<PAGE>
                                                                   Exhibit 10.36

                                                                  CONFORMED COPY

DATED                              21 December                              1999
________________________________________________________________________________



                            PERSON SERVICES LIMITED                          (1)

                                    - AND -

                     PEARSON GROUP PENSION TRUSTEE LIMITED                   (2)





________________________________________________________________________________


                         DEED OF ADOPTION OF NEW RULES

                                 IN RESPECT OF

                               THE EXTEL SECTION

                                       OF

                         THE PEARSON GROUP PENSION PLAN

________________________________________________________________________________





                              Lovell White Durrant
                               65 Holborn Viaduct
                                London EC1A 2DY

                                   B2/JM/RAS
<PAGE>
                                                              Stamp (pound) 5.00
                                                                        12.01.00

THIS DEED OF ADOPTION OF NEW RULES is made           21 December            1999

BETWEEN:

(1)  PEARSON SERVICES LIMITED (registered in England No. 1341060) whose
     registered office is at 3 Burlington Gardens London W1X 1LE (the "Principal
     Company"); and

(2)  PEARSON GROUP PENSION TRUSTEE LIMITED (registered in England No. 1765290)
     whose registered office is at 3 Burlington Gardens aforesaid (the
     "Trustee").

WHEREAS:

(A)  The Pearson Group Pension Plan (the "Plan") is at the date hereof governed
     by a trust deed made on 10 October 1997 (the "Trust Deed").

(B)  The Trustee is the present trustee of the Plan.

(C)  By clause A.4 of the Trust Deed the Trustee may at any time with the
     consent of the Principal Company alter or modify all or any of the
     provisions of the Plan subject as therein mentioned.

(D)  The Trustee wishes to alter the Rules of The Extel Section in the way set
     out below and the Principal Company consents to the alteration, as is shown
     by its execution of this deed.

NOW THIS DEED WITNESSES that the rules set out in the schedule to the Deed of
Adoption of Rules in respect of The Extel Section of the Plan dated 8 September
1998 shall cease to have effect and the rules set out in the schedule to this
deed are substituted in their place as the Rules of The Extel Section with
effect on and from the date of this deed SAVE AND EXCEPT that (unless
explicitly stated to the contrary in the Rules set out in the schedule to this
deed) in respect of the rights and benefits under the Plan of all persons who
were not active Members on the date of this deed the provisions of the rules of
the Plan in force prior to the date of this deed shall (where appropriate)
continue to apply PROVIDED HOWEVER that the Trustee and the Principal Company
shall not hereby be precluded from making any specific alteration or
modification within their powers under the Trust Deed relating to such Members
or any of them.

EXECUTED AS A DEED the day and year first above written.
<PAGE>
                                      -2-

                                    SCHEDULE

                       THE RULES OF THE EXTEL SECTION OF
                         THE PEARSON GROUP PENSION PLAN

                                    CONTENTS

<TABLE>
<CAPTION>
Rule                                                                        Page
<S>       <C>                                                               <C>
A.        DEFINITIONS                                                          4

B.        ADMINISTRATION OF SECTION

B.1       LEAD COMPANY                                                         9
B.2       INVESTMENT COMMITTEE                                                 9
B.3       TRANSITIONAL ARRANGEMENTS                                            9
B.4       EMPLOYMENTS TO WHICH THESE RULES RELATE                              9
B.5       EQUAL TREATMENT                                                      9

C.        MEMBERSHIP AND CONTRIBUTIONS

C.1       MEMBERSHIP                                                          10
C.2       ABSENCE FROM WORK                                                   10
C.3       PART-TIME EMPLOYMENT                                                11
C.4       MEMBERS' CONTRIBUTIONS                                              12
C.5       CHANGE OF EMPLOYER                                                  12
C.6       LINKED PENSIONABLE SERVICE                                          12
C.7       SECONDMENT                                                          13

D.        BENEFITS ON RETIREMENT

D.1       PENSION RETIREMENT AT NORMAL RETIREMENT DATE                        14
D.2       LATE RETIREMENT                                                     14
D.3       EARLY RETIREMENT DUE TO INCAPACITY                                  14
D.4       EARLY RETIREMENT FOR REASONS OTHER THAN INCAPACITY                  15
D.5       OPTIONAL PENSION FOR DEPENDANTS                                     16
D.6       COMMUTATION                                                         17

E.        BENEFITS ON DEATH

E.1       DEATH OF A MEMBER IN SERVICE                                        18
E.2       DEATH WHILST ENTITLED TO A DEFERRED PENSION                         19
E.3       DEATH IN RETIREMENT                                                 19
E.4       DEPENDANTS' PENSIONS                                                20
E.5       REDUCTION FOR YOUNG SPOUSE                                          20
E.6       RECENT MARRIAGE OF A MEMBER                                         20
</TABLE>

<PAGE>
<Table>
<Caption>
Rule                                                                 Page
<C>       <S>                                                        <C>
F.        BENEFITS ON WITHDRAWAL

F.1       BENEFITS ON WITHDRAWAL                                      21
F.2       RETURN OF CONTRIBUTIONS                                     21
F.3       DEFERRED PENSION                                            21
F.4       LATE PAYMENT                                                22
F.5       EARLY PAYMENT                                               22
F.6       MINIMUM AMOUNTS ON EARLY OR LATE PAYMENT                    23
F.7       TRANSFERS                                                   24


G.        ADDITIONAL BENEFITS

G.1       PENSION INCREASES                                           25


H.        PAYMENT OF BENEFITS

H.1       PENSIONS                                                    26
H.2       METHOD OF PAYMENT                                           26
H.3       INTEREST ON LATE PAYMENT                                    26
H.4       DISPUTES                                                    26
H.5       PROVISION OF INFORMATION                                    27
H.6       DEDUCTION OF TAX                                            27
H.7       MINORS                                                      27
H.8       PROTECTION FOR THE TRUSTEE                                  27
H.9       DISTRIBUTION OF LUMP SUM DEATH BENEFITS                     28


          APPENDIX

          SPECIAL PROVISIONS IN RESPECT OF MEMBERS OF THE OLD
          PLAN WHOSE PENSIONABLE SERVICE ENDED PRIOR TO
          1 FEBRUARY 1995                                             29
</Table>


<PAGE>
A.     DEFINITIONS

A.1.1  Unless the context otherwise requires:

       (a)  the definitions contained in paragraph 1 of Schedule 5 to the Trust
            Deed shall apply to these Rules, except where Rule A.1.2 below
            gives a different meaning to any of the terms used in Schedule 5 or
            adds to those terms;

       (b)  the provisions as to interpretation in paragraphs 2, 3 and 4 of
            Schedule 5 to the Trust Deed shall apply to these Rules; and

       (c)  the Appendix shall form part of these Rules.

A.1.2  The terms set out below shall have the following meanings:

       "AVERAGE REVALUED FLUCTUATING EARNINGS"
       a Member's Revalued Fluctuating Earnings divided by the number of
       complete years (and a fraction for complete months) of Pensionable
       Service after 6 April 1978. If a Member has been in Pensionable Service
       for less than 12 months it means the amount of Fluctuating Earnings in
       excess of the amount of Salary paid to him or her during the period of
       his or her Pensionable Service. This amount is revalued as described in
       the definition of Revalued Fluctuating Earnings only if a 5 April falls
       in the period of his or her Pensionable Service;

       "CHILD"
       in relation to a Member, a child of the Member (including a stepchild or
       adopted child) and from the date of his or her birth any such child
       conceived but not born before the Member's death and any other child
       who is in the opinion of the Trustee financially dependent on the
       Member. Such child must be under age 18 of under age 23 and receiving
       full-time education or unpaid vocational training;

       "COMMENCEMENT DATE"
       1 February 1995;

       "DEPENDENT"
       in relation to a Member, any natural person who in the opinion of the
       Trustee is (or was at the date of the Member's death) financially
       dependent on the Member;

       "EMPLOYEE"
       a permanent employee, or a director, in Service with any of the
       Employers to which these Rules relate;

       "FINAL PENSIONABLE SALARY"
       in relation to a Member the greater of:

       (a)  the highest Salary paid to the Member in any consecutive period of
            12 months in the five years immediately before the termination of
            the Member's Pensionable Service. If a Member has been in
            Pensionable Service for less than 12 months, the amount of Salary
            paid to him or her during Pensionable Service is converted to an
            annual amount on an appropriate basis as advised by the Actuary; and

<PAGE>
                                      -5-


(b)       the highest time-weighted annual average rate of the Member's Salary
          calculations made for the purposes of the Rules in any period of three
          consecutive years ending in the ten years immediately before the
          termination of the Member's Pensionable Service;

For the purposes of this definition Salary is interpreted as if the words "the
annual rate of" were omitted;

"FLUCTUATING EARNINGS"
the annual amount of all emoluments paid to a Member by his or her Employer
which are treated for tax purposes as emoluments of an office or employment,
less the Member's Salary;

"GROSS PAY"
the annual rate of all a Member's emoluments from his or her Employer which are
treated for tax purposes as emoluments from an office or employment other than
any amounts paid to the Member by the Employer to reimburse expenses which he
or she has properly incurred in respect of his or her Employment or as an
allowance in respect of such expenses. It also includes any pay which the Lead
Company has declared to be profit related pay;

"INCAPACITY"
either that a Member is prevented by physical or mental deterioration from
following his or her normal employment with the Employer or that his or her
earning capacity is seriously impaired. The decision whether or not a Member is
incapacitated is for the Lead Company on the basis of opinions from not fewer
than two qualified medical practitioners;

"LEAD COMPANY"
Exshare Financial Limited (previously called Extel Financial Limited)
registered in England No. 949387);

"LIMITED MEMBER"
See Rule C.1.3;

"LOWER TIER MEMBER"
a Member who is paying contributions to the Plan at the lower rate described in
Rule C.4.1;

"LOWER TIER SERVICE CREDIT"
in respect of a Member who:

(a)       joined The Extel Section with effect from Commencement Date;
(b)       was not in receipt of a pension at Commencement Date; and
(c)       had not ceased on or before Commencement date to Accrue benefits under
          the Old Plan with entitlement to deferred pension under the Plan at
          Commencement Date

the number of months of additional notional pensionable service calculated as
follows:

          (i)       for a Member who had not attained age 62 on Commencement
                    Date,

                    N x 36
                    -
                    NS

                    where
<PAGE>
                                      -6-

          N  = the number of calendar months of the Member's Pensionable Service
               completed after Commencement Date but before Normal Retirement
               Date as a Lower Tier Member;

          NS = the number of calendar months of the Member's potential
               Pensionable Service from Commencement Date to Normal Retirement
               Date


          Provided that should any of the Member's potential Pensionable Service
          be part-time employment, the Member's benefits shall be adjusted
          appropriately as the Trustee acting on the advice of the Actuary shall
          decide; and

    (ii)  for a Member who had attained age 62 on Commencement Date and was a
          Lower Tier Member on that date, the actual number of months'
          difference between Commencement Date and that Member's 65th birthday,

"MEMBER"
a person in membership of The Extel Section of the Plan so long as any benefits
are or may be payable to or in respect of him or her under the Plan;

"NORMAL RETIREMENT DATE"
in respect of all Members admitted as active Members of The Extel Section on or
after the Commencement Date, the 62nd birthday;

"OLD PLAN"
the Extel Pension Fund established by a trust deed dated 1 March 1929;

"PENSIONABLE SERVICE"
in respect of a Member the period calculated in complete years and months (with
each month counted as one-twelfth of a year) equal to the aggregate of (i) the
only or last period of Service as a Member of The Extel Section of the Plan up
to Normal Retirement Date (subject to Rule D.2.1) or, if earlier, the effective
date of any notice given under Rule C.1.4 and (ii) a period equal to the
Member's pensionable service accrued or credited under the Old Plan as at
Commencement Date. Where the Member was an active member of the Old Plan on the
day immediately before Commencement Date and became an active Member of The
Extel Section on Commencement Date, this second period shall be increased by 10
per cent. Where a Member has paid additional voluntary contributions under the
Old Plan before the Commencement Date on the basis of additional years of
Pensionable Service the period of such additional years:

(a) shall not be included when calculating the 10 per cent increase referred to
    above; and

(b) shall be actuarially adjusted to take account of the earlier Normal
    Retirement Date from which they will be payable.

"PRICES INDEX"
the general index of retail prices as published by the Central Statistical
Office or such other index as may from time to time be selected by the Trustee
with the consent of the Principal Company and approved for use in this behalf
by the Commissioners of Inland Revenue;

"PROTECTED 1989 MEMBER"
a Member in relation to whom restrictions of the type set out in paragraphs 20
and 22 to 26 of Schedule 6 to the Finance Act 1989 do not apply because of the
Retirement Benefits Schemes


<PAGE>


                                      -7-



(Continuation of Rights of Members of Approved Schemes) Regulations 1990 or a
decision of the Commissioners of Inland Revenue;

"REVALUED FLUCTUATING EARNINGS"
at the date he or she ceases to be in Pensionable Service, a Member's total
Fluctuating Earnings paid by an Employer after the date he or she became a
Member (or, if later, 6 April 1978) revalued on 5 April each year up to 5 April
before the date he or she ceases to be in Pensionable Service in the same way
(as far as practicable) as earnings factors are revalued in accordance with
orders made under s16(1) 1993 Act. If s16(1) or the orders made under it are
amended or re-enacted resulting in the method of revaluation becoming
inappropriate in the opinion of the Principal Company and the Trustee they may
agree to substitute another method of revaluation;

"SALARY"
the annual rate of a Member's basic remuneration from the Employers excluding
bonuses, commissions, overtime payments, shift pay, fees, travelling expenses
and any other fixed or fluctuating emoluments. It includes pay which the Lead
Company has declared to be profit related pay;

"SCALE PENSION"
in relation to a Member, the sum of:

(i)       1/60th of his or her Final Pensionable Salary multiplied by the period
          of his or her Pensionable Service before 6 April 1978;

(ii)      1/60th of his or her Final Pensionable Salary multiplied by the
          aggregate period of his or her Pensionable Service on and after 6
          April 1978 as an Upper Tier Member and his or her Upper Tier Service
          Credit;

(iii)     1/60th of that part of his or her Revalued Fluctuating Earnings which
          relates to his or her Pensionable Service on and after 6 April 1978 as
          an Upper Tier Member;

(iv)      1/100th of his or her Final Pensionable Salary multiplied by the
          aggregate period of his or her Pensionable Service on and after 6
          April 1978 as a Lower Tier Member and his or her Lower Tier Service
          Credit;

(v)       1/100th of that part of his or her Revalued Fluctuating Earnings which
          relates to his or her Pensionable Service on and after 6 April 1978 as
          a Lower Tier Member.

If, when his or her Pensionable Service ends, the GMP of an Upper Tier Member
is greater than the sum of (iv) and (v) above, the sum of (i) to (v) above
must not be less than his or her GMP plus 1/150th of his or her Final
Pensionable Salary multiplied by the period of his or her Pensionable Service
on and after 6 April 1978 as an Upper Tier Member plus 1/150th of that part of
his or her Revalued Fluctuating Earnings which relates to his or her
Pensionable Service on and after 6 April 1978 as an Upper Tier Member.

"SPECIAL DIRECTOR"
a Member who, at any time in the ten years immediately before his or her Service
ends, has been a director of any of the Employers as defined in s612 1988 Act
and who is within s417(5)(b)1988 Act;

"UPPER TIER MEMBER"
a Member who is paying contributions to the Plan at the higher rate described
in Rule C.4.1;

<PAGE>
                                      -8-

"UPPER TIER SERVICE CREDIT"
in respect of a Member who:

(a)  joined The Extel Section with effect from Commencement Date;
(b)  was not in receipt of a pension at Commencement Date; and
(c)  had not ceased on or before Commencement Date to accrue benefits under the
     Old Plan with entitlement to deferred pension under the Plan at
     Commencement Date

the number of months of additional notional pensionable service calculated as
follows:

     (i)  for a Member who had not attained age 62 on Commencement Date,

          N x 36
          --
          NS

          where

          N =  the number of calendar months of the Member's Pensionable Service
               completed after Commencement Date but before Normal Retirement
               Date as an Upper Tier Member;

          NS=  the number of calendar months of the Member's potential
               Pensionable Service from Commencement Date to Normal Retirement
               Date

          Provided that should any of the Member's potential Pensionable Service
          be part-time employment, the Member's benefits shall be adjusted
          appropriately as the Trustee acting on the advice of the Actuary
          shall decide; and

    (ii)  for a Member who had attained age 62 on Commencement Date and was an
          Upper Tier Member on that date, the actual number of months'
          difference between Commencement Date and that Member's 65th birthday;
<PAGE>
                                      -9-

B.   ADMINISTRATION OF SECTION

B.1  LEAD COMPANY

     Exshare Financial Limited (previously called Extel Financial Limited)
     registered in England No. 949387 is the Lead Company of The Extel Section.

B.2  INVESTMENT COMMITTEE

     See Trust Deed clause C.6.

B.3  TRANSITIONAL ARRANGEMENT

     On the occurrence of any event specified in Schedule 3B to the Trust Deed
     any Member entitled to an adjustment of all or part of his or her benefits
     from (or by reference to) The Extel Section shall have his or her benefits
     increased in such manner as the trustee shall determine by an amount equal
     in value to 54.43 per cent of the benefits which are to be adjusted. On the
     occurrence of any event specified in Schedule 3 to the Trust Deed (which
     could be relevant if a Member who was a Member of another Section on 1
     August 1988 transfers to The Extel Section) then the provisions of Schedule
     3 to the Trust Deed shall apply.

B.4  EMPLOYMENTS TO WHICH THESE RULES RELATE

     These Rules shall apply to employments with the following Employers:

     NAME OF EMPLOYER                             REGISTERED NUMBER

     Exshare Financial Limited                          949387
     The Financial Times Limited                        227590
     Financial Times Information Limited                980896
     AFX News Limited                                  2505735

     These Rules shall also apply to employments with such other of the
     Employers as the Principal Company with the consent of the Trustee
     may allow.

B.5. EQUAL TREATMENT

     To the extent required by law the Rules shall be subject to an overriding
     equal treatment rule as set out in s62 1995 Act.
<PAGE>
                                      -10-

C.        MEMBERSHIP AND CONTRIBUTIONS

C.1       MEMBERSHIP

C.1.1     Every Employee who was a Lower Tier Member of The Extel Section on 31
          March 1995 shall subject to Rules C.1.4 and C.1.5 remain a Lower Tier
          Member and every Employee who was an Upper Tier Member on 31 March
          1995 shall, subject to Rules C.1.4 and C.1.5 remain an Upper Tier
          Member.

C.1.2     No Employee shall be admitted as a Member after 31 March 1995.

C.1.3     An Employee who was a Limited Member on 31 March 1995 and who did not
          on 1 April 1995 leave Service or become an FP Member or an MP Member
          of the Pearson Group Sections became an Original Section Life
          Assurance Member of the Pearson Group Sections on 1 April 1995 and
          shall not be entitled to any benefits under The Extel Section after 1
          April 1995.

C.1.4     A Member may terminate his or her Pensionable Service whilst remaining
          in Service by giving to the Lead Company not less than one month's
          notice or such shorter period as may (subject to any statutory
          requirements) be agreed by it. The Member will then become entitled to
          the withdrawal benefits as specified in Rule F.2.1 or F.3 (as
          appropriate).

C.1.5     A Member who is a Lower Tier Member may elect by notice in writing to
          the Trustee to become an Upper Tier Member with effect from the 6
          April next following the date of the election but subject to that
          Member paying contributions under Rule C.4.1 at the rate of Upper Tier
          Members.

C.2       ABSENCE FROM WORK

C.2.1     Subject to Rule C.2.4 below, if a Member is absent from work for a
          reason approved by his or her Employer for the purpose of this Rule
          (whether or not remaining in Service) he or she shall be deemed to
          remain a Member provided there is, in the opinion of his or her
          Employer, a definite expectation of his or her return to work or the
          absence is because of incapacity and he or she is receiving pay under
          a sick pay or permanent health insurance scheme of the Employer. The
          period for which membership shall be deemed to continue shall be:

          (a)  the period of absence, if the absence is due to incapacity; or

          (b)  if the absence is due to any other reason, 36 months or such
               shorter period as there remains a definite expectation of his or
               her return to work

          unless the Lead Company (with the consent of the Commissioners of
          Inland Revenue if appropriate) allows a longer period of absence to
          count as membership.


C.2.2     Subject to this Rule C.2.2 and to Rule C.2.4, a period of absence will
          only count as Pensionable Service if the Member continues to pay
          contributions to the Plan during a period of absence or makes up the
          arrears on his or her return to work; this is subject to the exception
          in the case of a Member who is receiving contractual pay or statutory
          maternity pay during maternity absence as specified in Rule C.2.4
          below.

          If (and for so long as) a Member's remuneration during a period of
          absence is, in the opinion of the Trustee less than it would have been
          but for the absence, or if the Trustee agrees for any other reason:

<PAGE>
                                     - 11 -


         (a)   he or she may elect to suspend payment of contributions. He or
               she may pay those contributions later on a basis agreed with the
               Trustee; or

         (b)   he or she may elect to pay contributions on the basis of his or
               her remuneration immediately before the date it was reduced (the
               date and the amount of the reduction being decided by the
               Trustee) in which case his or her benefits will be calculated by
               reference to his or her remuneration immediately before it was
               reduced; or

         (c)   he or she may elect to pay contributions on the basis of his or
               her reduced remuneration in which case his or her new benefits
               will be calculated by reference to his or her reduced
               remuneration unless the Trustee decides that in fairness some
               addition should be made to his or her pension (subject to
               Approval) because he or she has paid contributions in the past on
               greater remuneration.


C.2.3    All Members will continue to be covered for the death benefits set out
         in Rules E.1.1 and E.1.2 during any period of absence which counts as
         Service.

C.2.4    A female Member who is absent from work due to pregnancy or confinement
         and who gives notice of her intention to return to work under s33
         Employment Protection (Consolidation) Act 1978 shall not be treated as
         leaving Service and the period of absence shall subject to Rule C.2.2
         be treated as Pensionable Service. She shall be covered for the death
         benefits set out in Rule E1.1 unless and until she has failed to
         return to work on the last day on which she could return to work under
         the provisions of that Act, but she shall then become entitled to the
         withdrawal benefits set out in Rule F.2 or F.3 (as appropriate). If she
         returns to work before such last day she shall not be entitled to the
         withdrawal benefits as she will continue to be in Pensionable Service.
         During any period of maternity absence where the female Member
         continues to receive contractual pay or statutory maternity pay and the
         provisions of Schedule 5 Social Security Act 1989 apply, she shall be
         obliged to pay contributions not on Gross Pay but on her basic
         remuneration at the rate in payment to her for the time being but she
         shall receive benefits based on the pay she would have received if she
         had been working normally.


C.3      PART-TIME EMPLOYMENT

C.3.1    This Rule applies to a Member who is required by his or her contract of
         employment to work fewer hours than the standard full-time working
         hours. The decision of his or her Employer as to the standard full-time
         working hours and the amount of remuneration which would have applied
         if the Member had been employed full-time is final.

C.3.2    The Member's Pensionable Service is adjusted for the purpose of
         calculating his or her Scale Pension. The adjustment is made by
         multiplying his or her Pensionable Service by the fraction PT/FT where:

         PT   is the number of hours each week (or other period selected by the
              Employer for this purpose) which the Member is from time to time
              required by his or her contract of employment to work; and

         FT   is the standard full-time number of hours as decided from time to
              time by the Employer.
<PAGE>
                                      -12-

C.3.3     The Member's basic remuneration is notionally increased by
          multiplying it by the fraction FT/PT which terms have the same meaning
          as in Rule C.3.2.

C.3.4     If the number of hours which the Member is required by his contract
          of employment to work for the period used in calculating PT changes,
          the Trustees will apply a new fraction to the Member's period of
          Pensionable Service following the effective date of the change to
          take account of that change. The fraction will also change if the
          standard full-time number of hours changes unless the part-time
          employee receives, in the opinion of his or her Employer, a
          commensurate adjustment to his or her basic remuneration.

C.4       MEMBER'S CONTRIBUTIONS

C.4.1     Subject to Rule C.4.2, each Member shall contribute to the Plan until
          his or her Pensionable Service ends. The annual rate of contributions
          shall be 6 per cent of an Upper Tier Member's Gross Pay (unless he or
          she became a Member before 1 January 1971, when under the age of 35,
          in which case his or her contributions shall be at the rate of 5 per
          cent) or 3.5 per cent of a Lower Tier Member's Gross Pay.

C.4.2     No Member will be required to contribute to the Plan under Rule C.4.1
          after completion of 40 years of Pensionable Service. A Member's
          Service thereafter does not count towards Pensionable Service. For
          the purposes of this Rule C.4.2, only 3/5ths of his or her
          Pensionable Service as a Lower Tier Member counts towards a Member's
          40 years.

C.4.3     Members may make Additional Voluntary Contributions on a money
          purchase basis or on the basis of his or her being awarded an
          additional period of Pensionable Service, and in either case in
          accordance with clause F.1 of the Trust Deed. The Trustee's consent
          is required in the case of a Member who wishes to pay Additional
          Voluntary Contributions on the latter basis if he did not pay them to
          the Old Plan on that basis.

C.4.4     Each Member's contributions shall be collected by the Employer by
          deduction from the Member's remuneration or in such other manner as
          the Trustee shall decide. All such contributions shall be paid by the
          Employers forthwith to the Trustee or as the Trustee shall otherwise
          direct.

C.5       CHANGE OF EMPLOYER

          If any Member transfers from the Service of one Employer to the
          Service of another Employer and these Rules apply to employment with
          both Employers, the Member shall not be treated as leaving
          Pensionable Service on the transfer.

C.6       LINKED PENSIONABLE SERVICE

C.6.1     Subject to Rules C.2.2, C.2.4 and C.6.2 and to clause H.2 and
          Schedule 4 of the Trust Deed, a Member who leaves and re-enters
          Pensionable Service or whose Pensionable Service is interrupted shall
          receive benefits in respect of each period of Pensionable Service as
          if he or she had not previously been in Pensionable Service.

C.6.2     Where a Member leaves and re-enters Pensionable Service or a Member's
          Pensionable Service is interrupted in circumstances where the Member
          has retained a right to pension benefits under The

<PAGE>
                                      -13-



     Extel Section of the Plan in respect of the first period of Pensionable
     Service the Member may, with the consent of the Lead Company, elect to
     surrender his or her entitlement to pension benefits in respect of the
     first period of Pensionable Service on terms that the two periods of
     Pensionable Service be aggregated for the purpose of calculating his or
     her entitlement to benefits under the Plan.

C.7  SECONDMENT

     Any Member who is seconded or transferred by his or her Employer to work
     for another employer (whether or not in the United Kingdom and including
     any government agency) may, by written agreement between the Member and
     his or her Employer, be deemed to remain a Member in Pensionable Service
     for a period which is determined by the Employer and will not prejudice
     Approval.

<PAGE>
                                      -14-

D.        BENEFITS ON RETIREMENT

D.1.1     PENSION ON RETIREMENT AT NORMAL RETIREMENT DATE

          Each Member who retires from Pensionable Service at Normal Retirement
          Date shall receive an immediate annual pension equal to his or her
          Scale Pension.

D.1.2     No pension under Rule D.1.1 shall exceed Inland Revenue Limits or be
          less than required by the Contracted-out Requirements.


D.2.1     LATE RETIREMENT

          If, with the consent of the Employer, a Member remains in Service
          after Normal Retirement Date his or her Pensionable Service shall be
          deemed to continue and the Member shall continue to contribute
          subject to Rule C.4.2. Unless Rule C.4.2 applies the annual rate of
          the Member's pension shall be calculated under Rule D.1.1 as if the
          date he or she ceased to contribute to the Plan under Rule C.4.1 was
          his or her Normal Retirement Date. If this pension is not paid to the
          Member with effect from the date he or she ceases to contribute
          under Rule C.4.1 it shall be increased until it does commence by a
          percentage decided by the Trustee after consulting the Actuary. If
          Rule C.4.2 applies the Member's pension is calculated using
          Pensionable Service up to the date Rule C.4.2 applies but Final
          Pensionable Salary and Revalued Fluctuating Earnings at the date of
          the Member's late retirement are used if they are higher than at the
          date Rule C.4.2 applied.

D.2.2     If a Member remains in Service after Normal Retirement Date he or she
          may, if the Trustee agrees, exercise option (a), (b) or (c) below:

          (a)  take an immediate pension calculated under Rule D.2.1 from a date
               (the "agreed date") he or she agrees with the Trustee (but not
               later than his or her retirement from Service);

          (b)  take a cash sum under Rule D.6.1 on, and the balance of his or
               her pension under Rule D.2.1 from, the agreed date;

          (c)  take a cash sum under Rule D.6.1 on the agreed date, and the
               balance of his or her pension under Rule D.2.1 from a later date
               he or she agrees with the Trustee (but not later than his or her
               retirement from Service).

          A Member who exercises any of the above options is deemed to have
          retired on the agreed date. These options do not apply to a Member
          who joined the Old Plan or the Plan on or after 1 June 1989 and who
          is not a Protected 1989 Member.

D.2.3     No pension under Rules D.2.1 or D.2.2 shall exceed Inland Revenue
          Limits or be less than required by the Contracted-out Requirements.


D.3.1     EARLY RETIREMENT DUE TO INCAPACITY

          If a Member retires from Pensionable Service with the consent of the
          Lead Company at any time before Normal Retirement Date on account of
          Incapacity the Member shall be entitled to receive an immediate
          pension equal to 50 per cent of his or her Scale Pension calculated
          on the basis of the following assumptions:


<PAGE>
                                      -15-


        (a) that the Member had remained in Pensionable Service until Normal
            Retirement Date without change in his or her Salary;

        (b) that his or her Fluctuating Earnings stopped at and were revalued
            up to the 5 April before the date of early retirement;

        (c) that his on her Pensionable Service from the date of early
            retirement until Normal Retirement Date is comprised of Upper Tier
            membership and Lower Tier membership in the same ratio as his or her
            completed Pensionable Service after 6 April 1978;

        Provided that the Scale Pension so calculated will not be less than the
        Member's Scale Pension calculated as at the date his or her Pensionable
        Service ends without taking any account of prospective Pensionable
        Service.

D.3.2   No pension under Rule D.3.1 shall exceed Inland Revenue Limits or be
        less than required by the Contracted-out Requirements.

D.4.1   EARLY RETIREMENT FOR REASONS OTHER THAN INCAPACITY

        If a Member not entitled to a pension under Rule D.3.1 retires from
        Pensionable Service with the consent of the Lead Company on or after
        age 50 and before Normal Retirement Date, he or she may, if the Lead
        Company agrees, elect to receive an immediate pension calculated as in
        Rule D.1.1 but based on Final Pensionable Salary and Revalued
        Fluctuating Earnings at, and Pensionable Service up to, the date of
        retirement and the pension shall then be reduced by multiplying it by
        the factor shown in the following table:

        EXACT AGE AT EARLY RETIREMENT                 FACTOR

        60 and above                                  1
        59                                            0.970
        58                                            0.941
        57                                            0.913
        56                                            0.885
        55                                            0.859
        54                                            0.833
        53                                            0.808
        52                                            0.784
        51                                            0.760
        50                                            0.737


        This table is interpolated to take account of complete months of age
        attained at the date of early retirement.

        In the case of a Member who was in Pensionable Service on 31 August
        1991, however, the early retirement pension payable in the circumstances
        described in this Rule D.4.1 must not be less than the pension which
        would have been payable in these circumstances under the rules of the
        Old Plan in force on August 1991.

D.4.2   No pension under Rule D.4.1 shall exceed Inland Revenue Limits or be
        less than required by the Contracted-out Requirements.


<PAGE>
                                      -16-




D.4.3   Where a pension payable to a Member is to be increased after the Member
        reaches State Pensionable Age by reason of Rules D.4.2 or D.3.2, the
        pension payable to the Member before the Member reaches that age may be
        decreased by such amount as the Actuary prescribes but not so that the
        actuarial value of the pension payable is less than the actuarial value
        of the pension that would have been payable but for this Rule. The
        acturial value must be certified as reasonable by the Actuary.

D.4.4   The Trustee shall be reasonably satisfied that, on the date when the
        pension under Rule D.4.1 becomes payable, its value, together with the
        value of my benefit payable on the Member's death, is not less than the
        value on that date of any benefits which have accrued to or in respect
        of the Member, including for this purpose any increases in benefit which
        the Trustee estimates would accrue in accordance with the 1993 Act and
        taking into account the preservation requirements under the 1993 Act, if
        the Member elected to take a deferred pension under Rule F.3.

D.5.1   OPTIONAL PENSION FOR DEPENDANTS

        A Member may elect in writing to surrender part of his or her pension in
        order to provide one or more pensions payable on the Member's death to
        the Member's spouse and/or any Dependants nominated by the Member.

D.5.2   The option in D.5.1 above is subject to the following conditions:

        (a) it must be exercised within 12 months before the Member's pension
            becomes payable;

        (b) the aggregate of the pensions so provided shall be equal in value
            to the part of the Member's pension surrendered, calculated on a
            basis certified as reasonable by the Actuary;

        (c) the option may not be exercised so that the annual amount of a
            spouse's or Dependant's pension would be less than the limit
            specified in Rule D.6.3 at the time of surrender, or more than the
            Member's pension (including any part of it paid or payable in the
            form of cash under Rule D.6.1 but ignoring any reduction under Rule
            D.4.3) as reduced by the part surrendered;

        (d) the aggregate annual amount of the spouse's and Dependants'
            reversionary pensions together with any pension contingently
            payable in respect of the Member shall not exceed the annual amount
            of the Member's pension after surrender but before commutation
            under Rule D.6.1 and ignoring any reduction under Rule D.4.3;

        (e) if the spouse or nominated Dependant dies before the Member but
            after the Member's pension has commenced, the Member's pension
            after surrender shall not be affected, but if the spouse or
            nominated Dependant dies before the Member's pension becomes
            payable, the election under this Rule D.5.2 will be cancelled
            automatically and deemed not to have been exercised; and

        (f) the exercise of the option shall be subject to such restrictions as
            the Trustee considers appropriate to ensure that the Member's
            pension is not less than required by the Contracted-out
            Requirements.



<PAGE>
                                      -17-

D.6.1  COMMUTATION

       A member may (subject to any restrictions pursuant to clause F.1 and
       clause G.1 of the Trust Deed and to the Contracted-out Requirements)
       commute the whole or part of his or her pension for a lump sum by giving
       written notice to the Trustee. The lump sum shall not exceed Inland
       Revenue Limits. The amount of the pension foregone shall be such as the
       Trustee shall determine calculated on a basis certified as reasonable
       by the Actuary. This option must be exercised, and shall not take
       effect, before the date when the Member's pension under the Plan
       commences or (if earlier) the Member's Normal Retirement Date. This Rule
       D.6.1 shall not apply if Rule D.6.2 or Rule D.6.3 applies.

D.6.2  If a Member becomes entitled to payment of a pension in exceptional
       circumstances of serious ill-health, the Trustee may pay the Member in
       lieu of the whole or any part of that pension in excess of his or her GMP
       a lump sum of such amount as it shall determine, calculated on a basis
       certified as reasonable by the Actuary. Such sum may exceed Inland
       Revenue Limits applicable to lump sum payments.

D.6.3  The Trustee may pursuant to this Rule D.6.3 pay a Beneficiary in lieu of
       his or her pension or of any benefits payable on his or her death a lump
       sum of such amount as the Trustee shall determine, calculated on a basis
       certified as reasonable by the Actuary. This power may be exercised only
       if the aggregate annual amount of the pensions and pension equivalent of
       any lump sums to which that person is entitled under the Plan and under
       all other Retirement Benefits Schemes to which any of the Employers
       contributes or has contributed does not exceed L260 or any such other
       amount as may be prescribed under s21(1) and s77(6) 1993 Act and shall
       not prejudice Approval. For this purpose, where a Member's pension is due
       to commence prior to reaching State Pensionable Age, commutation under
       this Rule D.6.3 shall only be available where (i) a state scheme premium
       has been paid (or is treated as having been paid) in respect of the
       Member pursuant to the 1993 Act or the Member's benefits accrued pursuant
       to the Contracted-out Requirements are determined on the basis set out in
       Schedule 4 to the Trust Deed using (in the case of the Member's
       prospective GMP) the fixed rate revaluation method, and (ii) the Member
       is treated by all other schemes relating to his employment by the
       Employer as having retired or all of them are being wound up and the
       provisions of (i) apply to those schemes. On payment of a lump sum under
       this Rule, all entitlements to benefits payable to or in respect of the
       Member cease.
<PAGE>
                                      -18-

E.      BENEFITS OF DEATH

E.1.1   DEATH OF A MEMBER IN SERVICE

        On the death of any Member (other than a Member who has terminated
        Pensionable Service under Rule C.1.4) in Service the Trustee shall pay:

        (a)    if the Member dies before Normal Retirement Date,

               (i)       a lump sum equal to, in the case of an Upper Tier
                         Member, the sum of four times his or her Salary and
                         four times his or her Average Revalued Fluctuating
                         Earnings both calculated as at the date of death, or in
                         the case of a Lower Tier Member, 240 per cent of the
                         sum of his or her Salary and Average Revalued
                         Fluctuating Earnings both calculated as at the date of
                         death; and

               (ii)      the amount of his or her contributions to the Plan and
                         to the Old Plan other than Additional Voluntary
                         Contributions paid on a money-purchase basis; and

               (iii)     the value of his or her benefits as determined under
                         Clause F.1.4(a) of the Trust Deed; or

        (b)    if the Member dies after Normal Retirement Date, a lump sum of
               five times the pension which he or she would have received had he
               or she retired on the day before death ignoring any increases
               which would have applied while in payment;

        and in either case

        (c)    to the Member's spouse, an annual pension equal to 50 per cent of
               the Member's Scale Pension calculated as if he or she had
               remained in Pensionable Service until Normal Retirement Date
               without change in his or her Salary and assuming that his or her
               Fluctuating Earnings stopped at the date of his or her death and
               also that his or her Pensionable Service from the date of death
               until Normal Retirement Date is comprised of Upper Tier
               membership and Lower Tier membership in the same ratio as his or
               her completed Pensionable Service after 6 April 1978. However,
               the spouse's pension must not be less than the greater of (a) the
               spouse's GMP plus 50 per cent of the Member's pension in respect
               of Pensionable Service before 6 April 1978 and (b) 1/160th of the
               Member's Salary at death multiplied by his or her period of
               Contracted-out Employment; and

        (d)    if the Member leaves one or more Children, an annual pension to
               each Child of one sixth of the Member's Scale Pension (calculated
               as in (c) above) Provided that if the Member leaves more than
               three Children the total annual amount of the pensions payable to
               the Children is limited to 50 per cent of the Member's Scale
               Pension (payable to the Children in equal shares).

E.1.2   The benefits payable under Rule E.1.1 shall not exceed Inland Revenue
        Limits nor shall any pension payable to a Member's surviving spouse be
        less than required by the Contracted-out Requirements.
<PAGE>
                                     - 19 -

E.2.1     DEATH WHILST ENTITLED TO A DEFERRED PENSION

          On the death of a Member whose Pensionable Service has terminated and
          who is entitled to a deferred pension from the Plan in excess of his
          or her GMP the Trustee shall pay:

          (a)  the value of his or her benefits as determined under Clause
               F.1.4(a) of the Trust Deed; and

          (b)  (i)  subject to Rule E.2.2, a lump sum equal to the Member's
                    contributions to the Plan and to the Old Plan (other than
                    Additional Voluntary Contributions paid on a money-purchase
                    basis) together with compound interest at the rate of 3 per
                    cent per annum with yearly rests (or such higher rate
                    determined by the Lead Company) calculated on the 31
                    December each year. No interest runs for the period from the
                    31 December preceding the date of the Member's death, if
                    this is not a complete year. There is then deducted an
                    amount advised by the Actuary to be equal to the capital
                    value of the spouse's GMP; or

               (ii) subject to Rule E.2.3 to the Member's spouse, if the spouse
                    so elects, a pension equal to 50 per cent of the Member's
                    deferred pension under Rule F.3 revalued to his or her date
                    of death in accordance with Rule F.3(a).

E.2.2     Any lump sum payable under Rule E.2.1(b)(i) must be at least eleven
          times the amount by which the spouse's Requisite Benefit is greater
          than the spouse's GMP. Requisite Benefit means a pension payable to
          the spouse for life equal to 1/160th of the Member's Salary multiplied
          by the period of his or her Pensionable Service.

E.2.3     (i)  Any spouse's pension payable under Rule E.2.1(b)(ii) must be at
               least equal to the spouse's GMP plus 50 per cent of the Member's
               deferred pension in respect of Pensionable Service before 6 April
               1978;

          (ii) On the death of a spouse entitled to a pension under Rule
               E.2.1(b)(ii), the Trustee may pay to one or more Dependants of
               the Member in such shares as they decide, a sum equal to the
               amount (if any) by which the lump sum in Rule E.2.1(b)(i) (but
               ignoring the deduction mentioned in that Rule) exceeds the amount
               of the spouse's pension which has been paid under Rule
               E.2.1(b)(ii).

E.2.4     The benefits payable under Rule E.2. shall not exceed Inland Revenue
          Limits nor shall any pension payable to a Member's surviving spouse be
          less than required by the Contracted-out Requirements.

E.3.1     DEATH IN RETIREMENT

          On the death in retirement of a Member the Trustee shall pay:

          (a)  if the Member dies within five years of the commencement of his
               or her pension, a lump sum in accordance with Rule H.9.1 equal to
               the unpaid balance of 60 monthly instalments of the Member's
               pension under Rules D.1 to D.4 at the rate in force at the date
               of the Member's death ignoring any increases which would have
               applied while in payment. If a Member who has exercised option
               (c) in Rule D.2.2 dies before his or her pension starts, a lump
               sum in accordance with Rule H.9.1 equal to five times the annual
               pension which would have been payable if it had started on the
               date of his or her death ignoring any increases which would have
               applied while in payment;
<PAGE>
                                      -20-

               (b)  to the Member's surviving spouse, a pension equal to 50 per
                    cent of the pension under Rules D.1 to D.4 which the Member
                    would have been receiving at the date of his or her death
                    ignoring the exercise of any option to allocate, commute or
                    reallocate under Rule D.5.1, Rule D.6.1 or Rule D.4.3; and

               (c)  if the Member (except a Member in receipt of a pension who
                    was only entitled to a GMP) leaves a Child or Children, a
                    pension to each of the Member's Children equal to one-sixth
                    of the Member's pension under Rules D.1 to D.4 calculated
                    as in (b) above Provided that if the Member leaves more than
                    three Children the total annual amount of the pensions
                    payable to the Children is limited to 50 per cent of the
                    Member's Scale Pension (payable to the Children in equal
                    shares.)

     E.3.2     The benefits payable under Rule E.3.1 shall not exceed Inland
               Revenue Limits and shall comply with the Contracted-out
               Requirements. Subject thereto no pension payable to a Member's
               surviving spouse shall be less than the greater of 1/160th of the
               Member's Salary at the date his or her Contracted-out Employment
               ended multiplied by the period of Contracted-out Employment and
               the spouse's GMP.

     E.3.3     No pension shall be payable to a spouse or Child if a Member has
               received a lump sum under Rule D.6.3 instead of all of his or
               her pension.

     E.4       DEPENDANTS' PENSIONS

               If when the Member dies he or she is not survived by a spouse,
               the Trustee may in its discretion apply all or part of the
               pension which would have been payable had there been a surviving
               spouse to or for the benefit of the Member's Dependants in such
               shares as the Trustee in its discretion thinks fit, in which case
               the pension so payable shall (unless the Trustee otherwise
               determines) cease upon the death of the Dependant concerned
               except where the Dependent is a Child in which case it shall
               cease when the Child ceases to be a Child.

     E.5       REDUCTION FOR YOUNG SPOUSE

               If a Member's spouse is more than ten years younger than that
               Member at the date of the Member's death, then the Trustee may
               (subject to the Contracted-out Requirements) reduce the spouse's
               pension by an amount determined by the Trustee after consulting
               the Actuary (such amount not to be greater than 2.5 per cent in
               respect of each complete year in excess of ten and so in
               proportion for completed months).

     E.6       RECENT MARRIAGE OF A MEMBER

               If the spouse's marriage to the Member took place after he or
               she ceased to be in Pensionable Service and the Member dies
               within six months of the marriage, the spouse's pension is
               restricted to the spouse's GMP (or such greater amount as the
               Lead Company may decide) and its will cease on the spouse's
               remarriage before State Pensionable Age.
<PAGE>
                                      -21-

F.     BENEFITS ON WITHDRAWAL

F.1    BENEFITS ON WITHDRAWAL

       On the termination of Pensionable Service of a Member before Normal
       Retirement Date otherwise than by death or where the Member does not
       elect to receive the benefits payable on early retirement under Rule
       D.3.1 or D.4.1 if those Rules apply, the Member shall be entitled to
       receive the benefits specified in either Rule F.2.1 or F.3 (as
       appropriate).

F.2.1  RETURN ON CONTRIBUTIONS

       Subject to Rule F.2.2, if the Member has not completed two years of
       Qualifying Service and no transfer payment has been received in respect
       of the Member's rights from a Personal Pension Scheme under clause G.1 of
       the Trust Deed, the Trustee shall pay a lump sum equal to:

       (a)  the amount of contributions (excluding Additional Voluntary
            Contributions paid on a money-purchase basis) which the Member has
            made or is deemed to have made to the Plan plus interest at 3 per
            cent per annum compound with yearly rests (or any higher rate
            decided by the Lead Company). Interest is calculated at 31 December
            each year. Interest does not run for the period after the 31
            December preceding the date the Member's Pensionable Service ends if
            this is not a complete year; plus

       (b)  the value of this benefits as determined under clause F.1.4(a) of
            the Trust Deed; less

       (c)  the amount in relation to any contributions equivalent premium paid
            in respect of the Member as defined by and in accordance with s61(2)
            1993 Act; less

       (d)  the amount of tax or duty for which the Trustee is liable in respect
            thereof.

F.2.2  As an alternative to Rule F.2.1, the Member may notify the Trustee
       in writing within one month after his or her Pensionable Service ends
       that instead of receiving a return of his or her contributions, he or she
       wishes Rule F.3 or F.5 to apply to him or her.

F.3    DEFERRED PENSION

        If the Member has completed two years or more of Qualifying Service or a
        transfer payment in respect of the Member's rights under a Personal
        Pension Scheme has been received under clause G.1 of the Trust Deed, the
        Member shall be granted at the Member's option either of the benefits
        specified at (a) or (b) below. If the Member fails to notify the Trustee
        in writing of his or her choice within six months of ceasing to be in
        Pensionable Service, the Member will be deemed to have chosen option
        (a). (This is without prejudice to the Member's right under s95 1993
        Act).

       (a)  A deferred pension commencing at Normal Retirement Date at an annual
            rate equal to the greater of:

            (i)  A x B; and

            (ii) (A x (B - C)) + D

            where:
<PAGE>
                                      -22-

               A=    the revaluation percentage referred to in paragraph 1 of
                     Schedule 3 to the 1993 Act;

               B=    the Scale Pension (except that this is calculated using his
                     or her Salary at the date of leaving Pensionable Service
                     instead of Final Pensionable Salary);

               C=    any part of the Scale Pension which consists of the GMP
                     applicable to the Member on the day after the day his or
                     her Pensionable Service ends; and

               D=    any part of the Scale Pension which consists of the GMP as
                     revalued in accordance with Schedule 4 of the Trust Deed.

               However, the deferred pension must be increased, if necessary, so
               that its value will, to the reasonable satisfaction of the
               Trustee exceed or compare reasonably with the Member's
               contributions to the Plan and the Old Plan (other than his or her
               Additional Voluntary Contributions).

         (b)   if the right conferred by Chapter IV of Part IV of the 1993 Act
               summarised in clause G.2 of the Trust Deed applies to the Member,
               a transfer payment in accordance with such right.

F.4      LATE PAYMENT

         A Member entitled to a deferred pension under Rule F.3 who remains in
         employment after Normal Retirement Date may, on attaining Normal
         Retirement Date, elect by notice in writing to the Trustee to postpone
         payment of his or her pension beyond that date. If the payment of a
         Member's pension is postponed it shall commence on a date no later than
         the date of the Member's actual retirement from employment or his or
         her 70th birthday (if earlier). If the deferred pension is postponed it
         shall be increased when it becomes payable by such amount as the
         Trustee on the advice of the Actuary shall decide in order to comply
         with Rule F.6.2 and also to take account of the later date on which the
         pension comes into payment.

F.5.1    EARLY PAYMENT

         A Member who is aged 50 or more and who is entitled to a deferred
         pension under Rule F.3 may make a request to the Trustee (subject to
         Rule F.5.2), that his or her pension should commence before Normal
         Retirement Date. The Trustee may accept or reject the request. The
         amount of the deferred pension shall be reduced for each year and
         proportionately for each complete month by which the date it starts to
         be paid is before Normal Retirement Date (the "Shortfall Period") as
         follows:

         (a)   if the Member's contributions had ceased due to the application
               of Rule C.4.2. the reduction is 2.5 per cent;

         (b)   if the period of further Pensionable Service (after any
               adjustment required in respect of Lower Tier membership under
               Rule C.4.2) which he or she had to complete, on the day his or
               her Pensionable Service ended, to achieve the Pensionable Service
               limit under Rule C.4.2 (the "Accrual Period") is greater than or
               equal to the Shortfall Period, the reduction is 5 per cent;
<PAGE>
                                     - 23 -


         (c)   if the Accrual Period is less than the Shortfall Period, the
               reduction is 5 per cent for the balance of the Accrual Period and
               2.5 per cent for the remainder of the Shortfall Period
               thereafter;

         For the purpose of the Rule F.5.1, Rule C.4.2 is applied as if the
         Member had remained in the same Tier of membership as applied at the
         date he or she ceased to be in Pensionable Service.

F.5.2    Where Rule F.5.1 applies to a female Member who was a member of the Old
         Plan on 31 August 1991 and who joined the Plan on Commencement Date the
         pension shall:

         (a)   in respect of Pensionable Service before 31 August 1991 be
               reduced only if she is under age 60 and if so the pension shall
               be calculated as if her 60th birthday was her Normal Retirement
               Date;

         (b)   in respect of Pensionable Service from 31 August 1991 be reduced
               and calculated by reference to Normal Retirement Date.

F.5.3    Where Rule F.5.1 applies to a male Member who was a member of the Old
         Plan on 31 August 1991 and who joined the Plan on Commencement Date the
         pension shall:

         (a)   in respect of Pensionable Service before 17 May 1990 be reduced
               and calculated by reference to Normal Retirement Date;

         (b)   in respect of Pensionable Service from 17 May 1990 and before 31
               August 1991 be reduced only if he is under age 60 and if so the
               pension shall be calculated as if his 60th birthday was his
               Normal Retirement Date;

         (c)   in respect of Pensionable Service from 31 August 1991 shall be
               reduced and calculated by reference to Normal Retirement Date.

F.6.1    MINIMUM AMOUNTS ON EARLY OR LATE PAYMENT

         Any pension payable under Rules F.4 or F.5.1 shall not be less than
         required by the Contracted-out Requirements.

F.6.2    The Trustee shall, after consulting the Actuary, ensure to its
         reasonable satisfaction that on the date when a pension becomes payable
         under Rule F.4 or Rule F.5, its value, together with the value of any
         benefits payable on the Member's death, is not less than the value on
         that date of any benefits which have accrued to or in respect of the
         Member, including for this purpose any increases in benefits which have
         accrued or which the Trustee estimates would accrue (as appropriate) in
         accordance with the 1993 Act taking account of the preservation
         requirements in the Act.

F.6.3    Where a pension payable to any Member is to be increased after the
         Member reaches State Pensionable Age by reason of Rule F.6.1, the
         pension payable before the Member reaches that age shall be decreased
         by such amount as the Actuary prescribes but not so that the actuarial
         value of the pension payable is less than the actuarial value of the
         pension that would have been payable but for this Rule. The actuarial
         value must be certified as reasonable by the Actuary.

















<PAGE>
                                      -24-



F.7  TRANSFERS

     In any case where a Member's accrued benefits are transferred out of the
     Plan the transfer payment in respect of the Member must not be less than an
     amount equal to 110 per cent of the Member's contributions other than
     Additional Voluntary Contributions paid on a money purchase basis plus
     interest at the rate of 3 per cent per annum compounded with yearly rests
     and calculated at 31 December each year. No interest runs for the period
     from 31 December preceding the date the Member's Pensionable Service ends,
     if this is not a complete year.

<PAGE>
                                      -25-




G.    ADDITIONAL BENEFITS

G.1.1 PENSION INCREASES

      On each 1 January that part of each pension in payment which is in excess
      of the GMP shall (subject to Rule G.1.2) be increased by the percentage
      increase in the Prices Index during the year ending on the previous 30
      September. A proportionate increase shall be made to any pension which
      commenced after the previous 1 January except where the pension is payable
      to a spouse, Child or Dependant and commenced on the termination of the
      Member's own pension.

G.1.2 Pension increases under Rule G.1.1 shall not apply to pensions
      provided by Additional Voluntary Contributions paid on a money-purchase
      basis by a Member after 31 January 1995 and shall only apply to pensions
      provided by transfer payments received by the Plan (rather than the Old
      Plan) and to discretionary benefits and discretionary increases to the
      extent (if any) that the Lead Company with the consent of the Trustee has
      agreed.






<PAGE>
H.   PAYMENT OF BENEFITS

H.1    PENSIONS

       All pensions payable under the Rules are annual pensions accruing from
       day to day payable for life unless the contrary is stated and, unless the
       Trustee otherwise decides, shall be paid by equal monthly installments in
       advance on such day in each calendar month as may be selected by the
       Trustee.

H.2    METHOD OF PAYMENT

       All payments shall be made by bank credit transfer but at the payee's
       request the Trustee may in any case make payments at the payee's risk by
       cheque through letter post to the payee's last known address in the
       British Isles or by other means. The Trustee may, but shall not be
       obliged to, pay benefits in any currency other than sterling on terms to
       be agreed between the Trustee and the Member.  Where the emoluments of a
       Member are payable in another currency, they shall for the purpose of
       determining their amount on any date at which a calculation of the
       Members emoluments is to be made be converted into sterling at the rate
       of exchange obtainable from the bankers of the Trustee or its agents on
       that date.

H.3    INTEREST ON LATE PAYMENT

       The Trustee may in its absolute discretion pay interest on any sums
       payable to any person if such sums are not paid within 28 days of the
       date on which payment is due and at such rate as the Trustee may in any
       particular case decide.

H.4.1  DISPUTES

       The Trustee, whose decision shall be final and binding, shall decide all
       questions and matters of doubt arising in connection with the amount of
       any pension or lump sum, or the amount of any increase or reduction or
       the amount which is equivalent or of equal value to any pension or
       instalment of pension and in doing so the Trustee shall have regard to
       the advice of the Actuary who shall be entitled to make such assumptions
       as the Actuary deems appropriate and to take into account any other
       benefits prospectively payable in respect of the Member who is entitled
       to the benefit in question.

H.4.2  Any dispute shall be resolved in accordance with the Dispute Resolution
       Procedure.

H.4.3  Where two or more persons have a claim to be the surviving spouse
       of any Member then any benefit payable under the Rules to or for the
       benefit of the surviving spouse shall in the absolute discretion of the
       Trustee be paid or applied to or for the benefit of such one or more of
       the claimants and in such proportions as it thinks fit, save that the
       benefits (if any) payable to a surviving spouse pursuant to the
       Contracted-out Requirements shall only be payable to the person entitled
       under the Contracted-out Requirements to receive the same.
<PAGE>
                                      -27-



H.5       PROVISION OF INFORMATION

          If any Member fails to furnish to the Trustee or the Lead Company any
          particulars required by them when required to do so or if any evidence
          of health furnished by such person is unsatisfactory to the Trustee or
          to the Lead Company (as appropriate), or if such particulars as have
          been furnished to the Trustee or to the Lead Company (whether or not
          requested by them) are found to be false, the Trustee may (subject to
          the preservation requirements of the 1993 Act) modify the benefits
          provided or to be provided in respect of such Member under the Rules
          in such manner as it considers to be appropriate after consulting the
          Actuary, but not so that the benefits would be less than required by
          the Contracted-out Requirements.

H.6       DEDUCTION OF TAX

          The Trustee shall be entitled to deduct from any benefit payable any
          tax or duty for which the Trustee is liable in respect of the benefit
          concerned.

H.7.1     MINORS

          Where a pension is payable for the benefit of any minor the Trustee
          may at its discretion:

          (a)  pay the pension to the minor's guardian or to any person with
               whom the minor resides or under whose care and control the minor
               is or appears to be, without being obliged to ascertain whether
               such guardian or other person has any right to the care and
               control of that minor or to supervise the application of the
               pension by such guardian or other person and without being
               responsible for any misapplication, and the receipt of the
               guardian or such other person to whom any moneys are paid shall
               be conclusive evidence that the Trustee has applied those moneys
               for the benefit of the minor; or

          (b)  apply the pension or any part of it towards the education or
               other benefit of the minor in any other way as the Trustee sees
               fit and the receipt of the person to whom any moneys are paid
               shall be conclusive evidence that the Trustee has applied those
               moneys for the benefit of the minor.

H.7.2     Any pension payable to a Child of a Member shall be payable until the
          Child ceases to be a Child.


H.8       PROTECTION FOR THE TRUSTEE

          The Trustee shall not be accountable in respect of, or obliged to see
          to, the application of any payment which is otherwise made in
          accordance with the Rules if it is made:

          (a)  to a minor direct or to his or her parent or guardian or to the
               person with whom he or she resides; or


          (b)  to any person who appears to the Trustee after reasonable
               enquiry to be a spouse to whom the payment may be made under the
               Rules, notwithstanding that such person is not such a spouse; or


<PAGE>
         (c) to any individual or institution who or which is or appears to be
             responsible for the care of a person to whom the payment may be
             made under the Rules if the Trustee considers that that person's
             incapacity does not warrant its making the payment to him or her
             direct.

H.9.1     DISTRIBUTION OF LUMP SUM DEATH BENEFITS

          Subject to the remaining provisions of this Rule, any lump sum death
          benefit becoming payable under the Rules shall be held by the Trustee
          upon trust with power to pay or apply the same to or for the benefit
          of all or any one or more of a class consisting of:

          (a)  the children, parents and grandparents of the Member and the
               Member's spouse or cohabitee;

          (b)  the issue of any such individuals (including stepchildren and
               adopted children);

          (c)  the spouses of any individuals in (a) and (b) and their issue;

          (d)  the Member's Dependants;

          (e)  any individual or body of persons (whether or not natural
               persons) nominated by the Member by notice in writing addressed
               to and received by the Trustee (or addressed to the trustee of
               the Old Plan and notified to the Trustee) during the Member's
               lifetime to receive the whole or any part of such benefit;

          (f)  any persons entitled to any interest in his or her estate
               (including unincorporated associations and trusts) under any
               valid testamentary disposition made by him or her or upon his or
               her intestacy; and

          (g)  the Member's legal personal representatives;

          in such shares and proportions (if more than one) as the Trustee in
          its absolute discretion decides.

H.9.2     The Trustee may also apply the whole or any part of such lump sum
          benefit by transferring it to trustees to be held by such trustees for
          any individual and/or body of persons referred to in (a) to (e) of
          Rule H.9.1 upon such trusts and powers (including discretionary trusts
          or powers exercisable by such trustees, including the power to charge
          remuneration) as the Trustee shall decide. Any expenses, fees or other
          outgoings incurred in connection with any payment, application or
          transfer pursuant to this Rule may, if the Trustee so decides, be
          deducted from or paid out of such benefits.

H.9.3     If any part of such lump sum benefit is not applied in accordance
          with Rule H.9.1 or Rule H.9.2 within a period of 24 months after the
          date of the Member's death it shall be paid to the Member's legal
          personal representatives.

H.9.4     The whole or any part of any lump sum death benefit shall be retained
          as part of the Fund if the Crown, the Duchy of Lancaster or the Duke
          of Cornwall would otherwise benefit therefrom.


<PAGE>
                                      -29-

                                    APPENDIX

            SPECIAL PROVISIONS IN RESPECT OF MEMBERS OF THE OLD PLAN
            WHOSE PENSIONABLE SERVICE ENDED PRIOR TO 1 FEBRUARY 1995

In accordance with clause 2.2 of the Deed of Adherence and Adoption of Rules
dated 31 January 1995, the improvements to the benefits of persons who
immediately before the Commencement Date were deferred pensioners or pensioners
under the Old Plan, are as follows:

(1)       DEFERRED PENSIONERS:

          The annual rate of the qualifying part of the deferred pension
          entitlement, including statutory revaluation and any discretionary
          increases in respect of that part up to the day before the
          Commencement Date, shall be increased with effect from the
          Commencement Date by 20 per cent. For this purpose the qualifying part
          means the whole of the deferred pension but excluding any part of the
          deferred pension attributable to Additional Voluntary Contributions
          (whether paid on an added years or money-purchase basis), any pension
          which only represents Equivalent Pension Benefits and any benefits
          derived from a transfer-in of assets to the Old Plan.

          The above improvement will be taken into account in calculating
          benefits for spouses and children.

          The normal retirement date for deferred pensioners is unchanged from
          that which applied under the Old Plan.

(2)       PENSIONERS

          The annual rate of the qualifying part of the pension entitlement of a
          pensioner, including any discretionary increases in respect of that
          part up to the day before the Commencement Date, shall be increased
          with effect from the Commencement Date by 20 per cent. For this
          purpose the qualifying part means the whole of the pension but
          excluding any part of the pension attributable to Additional Voluntary
          Contributions (whether paid on an added years or money-purchase
          basis), any pension which only represents Equivalent Pension Benefits
          and any pension derived from a transfer-in of assets to the Old Plan.

          The above improvement will be taken into account into calculating
          benefits for spouses and children.

          This 20 per cent increase will also apply to the qualifying part of
          pensions in payment on the Commencement Date to spouses, children and
          dependants.

(3)       ANNUAL PENSION INCREASES

          In future, where there is a right under the relevant provisions of the
          rules of the Old Plan to annual increases while pensions are in
          payment, or where pensions thereunder have received discretionary
          increases under the Old Plan the pension will be increased in all
          respects in accordance with Rule G.1 of the Extel Section. These
          increases shall also apply to those ex gratia pensions in payment
          under the Old Plan on the day before Commencement Date.

<PAGE>
                                      -30-


                                        ( EXECUTED as a deed under the
               LS                       ( Common Seal of Pearson Services
                                        ( Limited in the presence of:



                                                  David Bell
                                                  Director


                                                  J. Rowney
                                                  Secretary



               LS                       ( EXECUTED as a deed under the
                                        ( Common Seal of PEARSON GROUP
                                        ( PENSION TRUSTEE LIMITED in the
                                        ( presence of:


                                                  Peter Gill
                                                  Director


                                                  P Jenkins
                                                  Secretary

<PAGE>
                              DATED 21 December 1999
                              -------------------------------------------------



                                          PEARSON SERVICES LIMITED      (1)

                                                  - and -

                                           PEARSON GROUP PENSION
                                              TRUSTEE LIMITED           (2)








                               ------------------------------------------------

                                        DEED OF ADOPTION OF NEW RULES

                                                in respect of

                                              THE EXTEL SECTION

                                                     of

                                        THE PEARSON GROUP PENSION PLAN

                               ------------------------------------------------







                                              Lovell White Durrant
                                               65 Holborn Viaduct
                                                London EC1A 2DY

                                                   B2/JM/RAS