Exhibit 4.9

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STRICTLY PRIVATE & CONFIDENTIAL 
ADDRESSEE ONLYMac MillingtonManaging Director, Business to Consumer Banking



25th July 2000



Dear Mac,

As you know the PRC is carrying out a comprehensive review of the company's executive
    remuneration arrangements.

An outcome of this is a
decision to increase your salary to £265,000 with effect from 1st August
2000. I will, of course, write to you again if and when the PRC makes any other
changes.

Your sincerely,

John KingHuman Resources Director

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|STRICTLY PERSONALADDRESSEE ONLY 
Mr M J Millington
Group IT Director 
AbbeyHouse 
AH M4 02 | Abbey National plcAbbey House 
    201 Grafton Gate East
    Milton Keynes 
    MK9 1AN 
    Telephone 01908 343289 
    Facsimile 01908 343687 
    E-mail jking1@abbeynational.co.uk
|------------------------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                           |                                                                                                                                                                                       
|                                                                                           |                                                                                                                                                                                       
|                                                                                           | John King Human Resources Director                                                                                                                                                    
|JK/KB/141
16th May, 2000                                                                   |                                                                                                                                                                                       

Dear Mac

Following the recent
    Board announcement I am writing to confirm your appointment as Managing Director,
    Business to Consumer Banking with effect from 1st June, 2000. To reflect
    your
    increase in responsibilities your salary will be increased to £225,000
    from 1st June, 2000. You will be based in our Baker Street offices but, as
    with all executive appointments you will be expected to travel, both within
    and outside the UK, as and when it is necessary to discharge your responsibilities.
All other terms and conditions will remain unchanged.

As we discussed, the whole subject of Director's remuneration will be considered
      by the PRC in the middle of the year and this increase in no way anticipates
      the outcome of that review.

Please accept my best wishes on this appointment.

Yours sincerely



John KingHuman Resources Director

|The Abbey
              National Group comprises Abbey National plc and its subsidiary
              group of companies. 
      Abbey National plc Registered Office: Abbey House,
    Baker Street, London NW1 6XL Reg. No. 2294747. Registered in England. | CPLH
            0254
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------------------

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|STRICTLY PERSONALADDRESSEE ONLY 
      Mr M J Millington
      Group IT Director 
      AbbeyHouse 
      AH M4 02 | Abbey National plcAbbey House 
      201 Grafton Gate East
      Mil|ton Keynes 
      MK9 1AN 
      Telephone 01908 343289 
      Facsimile 01908 343687 
    E-mail jking1@abbeynational.co.uk
|------------------------------------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                   |                                                                                                                                                                                                  
|                                                                                                                   |                                                                                                                                                                                                  
|                                                                                                                   | John King Human Resources Director                                                                                                                                                               
|JK/KB/117
    17th April, 2000                                                                                     |                                                                                                                                                                                                  

Dear Mac

Variation to your Contract of Employment

The Personnel and Remuneration
Committee has agreed to an amendment to the Executive Managers’ Redundancy
Agreement. Clause 12.2 of your Contract of Employment sets out the terms which
apply in
the event of your redundancy and incorporates the Executive Managers' Redundancy
Agreement.

I am enclosing a copy of the amended clause, Schedule 2, which replaces the existing
    Clause 12.2 in your Contract with effect from 1st March, 2000 and should
    be substituted for it. All other terms of your Contract of Employment remains
    the same.

Yours sincerely



John KingHuman Resources Director

Enc:

|The Abbey National Group comprises Abbey
          National plc and its subsidiary group of companies. 
      Abbey National plc Registered Office: Abbey
    House, Baker Street, London NW1 6XL. Reg. No. 2294747. Registered in England. | CPLH
            0254
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------

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SCHEDULE 2


STATEMENT OF TERMS APPLICABLE TO SENIOR EXECUTIVES AND
EXECUTIVE MANAGERS OF ABBEY NATIONAL PLC IN THE EVENT OF  INVOLUNTARY REDUNDANCY

|1. | Definition                                                                                                                                                                                                                                                   
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                              
|   | Abbey National plc ("the Company")
      adopts the definition of redundancy given in Section 136 of the Employment
      Rights Act 1996 ("the Act"). Redundancy is there defined as a situation
    where:                                                 
|   |                                                                                                                                                                                                                                                              
|   | (a)                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                              
|   | (b)                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                              
|   | (c)                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                              
|   | (d)                                                                                                                                                                                                                                                          
|   |                                                                                                                                                                                                                                                              
|2. | Measures to Avoid Redundancy                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                              
|   | It is acknowledged that
      natural wastage can assist in the prevention of redundancy in some circumstances
      but the Company will make every effort to avoid or reduce the need for
      redundancy where in itself natural wastage is
insufficient.
|   |                                                                                                                                                                                                                                                              
|   | Every effort will also
      be made to re-deploy personnel affected by redundancy into suitable jobs.
    Due regard has to be given to the match between the skills                                                                                        

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|    | the possibility of retraining to effect a
        match. Other factors such as location and domestic arrangements may have
    to be considered.                                                                                                                                                                                                                                                
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|3.  | Terms of Severance                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|3.1 | The following terms are applied
        to those employees who leave the Company by way of redundancy. A person
        is redundant
        if he or she occupies a job which has been declared redundant and no
        suitable alternative employment has been offered. In these terms, "length
        of service" means the period of continuous employment as defined in the
        Act.
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|3.2 | The redundancy payment shall be equal to
        3.25 x one week's pay for each completed
year of service subject to:                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|    | –                                                                                                                                                                                                                                                                                                                                                                                               
|    | –                                                                                                                                                                                                                                                                                                                                                                                               
|    | –                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|3.3 |                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                 
|3.4 |                                                                                                                                                                                                                                                                                                                                                                                                 

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|4. | Planning                                                                                                                                                                                                                                                                                  
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                           
|   | The Company recognises that
          consultations on the possibility of redundancy arising should take
          place as early as is practicable and that wherever possible this should
          be in advance of any legal commitment which might from time to time
    arise by law.
|   |                                                                                                                                                                                                                                                                                           
|5. | Selection for Redundancy                                                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                           
|   | The following
    criteria will be borne in mind in the selection of people for redundancy:                                                                                                                                                                                               
|   |                                                                                                                                                                                                                                                                                           
|   | –                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                           
|   | –                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                           
|   | –                                                                                                                                                                                                                                                                                         
|   |                                                                                                                                                                                                                                                                                           
|   | –                                                                                                                                                                                                                                                                                         

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|6.  | Terms of Transfer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.1 | Where it is possible to transfer
          a person to avoid redundancy, provided that the person concerned has
          the necessary skills and potential to fill the job, this option will
    be used.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.2 | Where a post becomes redundant,
          the Company will seek to place the affected employee in a comparable
          alternative post. Where such post is offered the employee will not
          be regarded as being redundant and therefore will not be entitled to
          a redundancy payment on the terms set out in Clause 3 above. In deciding
          whether an alternative post is comparable, account will be taken of
    the location of the post and the nature and level of responsibilities.                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.3 | In some circumstances the
          Company may offer the employee an alternative post which, because of
          the location or nature of the duties, is not fully comparable with
          their previous role. In these cases the post will be offered on the
          basis of a trial period. The length of the trial period shall be determined
          by the Company and shall be at least equivalent to the period of notice
          required under Section 86 of the Act, subject to a minimum of one month
          and a maximum of six months. At the end of the trial period, the Company
          or the employee shall have the right to terminate the contract and
          in such circumstances the employee shall retain the right to a severance
    payment as set out in Clause 3 above.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.4 | In the event of a person being
          offered, and accepting, a transfer to a lower grade post, the Company
          shall determine whether or not any salary reductions shall apply (and,
          if so, on what basis they shall take effect) and the basis on which
          general salary increases shall be calculated in respect of the new
    post.                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.5 | On transfer the employee shall
          receive a statement in writing of all aspects of the new post (e.g.
          what the work is, where it is located, the job grade of the post and
    the change in terms and conditions implied by the transfer).                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.  | Mortgage Arrangements                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.1 | Where an employee who becomes
          redundant has a mortgage or part mortgage at a staff concessionary
          rate then that mortgage, or part mortgage, will continue at staff rate
    for six months in the case of a person who has less than                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  

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|                                                                                                                                                                                                                                                                          | two years of service and for
    one year in the case of a person who has two years or more of service.                                                                                                                                                                                                                                              
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                      
|7.2                                                                                                                                                                                                                                                                       | No decisions will be taken
          relating to the mortgage of a redundant employee without the involvement
    of the Human Resources Director.                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                      
|7.3                                                                                                                                                                                                                                                                       | In the event that the former
          employee moves house, either to take up new employment or to reduce
          the mortgage commitment, the Company will, after discussion with the
          individual, be prepared to consider varying its normal lending policies
    in respect of the size of the advance and the repayment arrangements.
|                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                      
|7.4                                                                                                                                                                                                                                                                       | Where a move is made for the
          reasons set out in Clause 7.3 above and for a period of less than two
          years from the date of expiry of the period of notice the Company will
    not charge a valuation fee for an advance on another property.                                                                                     
|                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                      
|The provisions outlined in
          Clauses 7.1 to 7.4 above are not intended to be an exhaustive statement
          of the Company's policy or position but merely indicate areas in which
    the Company would offer assistance to employees affected by redundancy.
|                                                                                                                                                                                                                                                                          |                                                                                                                                                                                                                                                                                                                                                      
|8.                                                                                                                                                                                                                                                                        | Pension Arrangements                                                                                                                                                                                                                                                                                                                                 

(These provisions apply to members
  of the Abbey National Amalgamated Pension Scheme only)

|8.1 | Subject always to clause 8.2
          below, employees who are made redundant and are 50 years of age or
          over may apply for early retirement. The Company will normally recommend
          to the trustees of the Pension Scheme that such requests be granted
          on the following basis and subject to any limits laid down by the Occupational
          Pensions Regulatory Authority, the Inland Revenue or the Rules of the
    Scheme:
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | 8.1.1                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | 8.1.2                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    | 8.1.3                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                

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|8.2 | Clause 8.1 shall be subject to
    the following provisions:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | 8.2.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | 8.2.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    | 8.2.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.3 | People who opt for early retirement
        shall not forego payments to which they are entitled under Clause 3 above
        except
    in the circumstances set out in Clause 3.3 above.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|8.4 | A member of the Abbey National Amalgamated
        Pension Scheme who leaves the service of the Company by reason of redundancy
        and who neither takes an immediate pension nor receives a refund of contributions
        made to the Scheme will be entitled to a deferred pension commencing
        at his/her normal pension date (as defined in the Rules of the Scheme)
        or to transfer his/her pension under the Rules of the Scheme. Any deferred
        pension will be calculated in accordance with the Rules of the Scheme
        and will be subject to increase throughout the period from the date of
        expiry of the period of notice to the Normal Pension Date. The increase
    will be calculated in accordance with the

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|   | Rules of the Scheme and such
    legislative provisions as may be operative at thetime.
|-- | ---------------------------------------------------------------------------------------
|   |                                                                                        
|9. | Legal Rights                                                                           
|   |                                                                                        
|   | No employee shall forfeit any legal rights
    under these arrangements.               

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C E R T I F I E D  C O P Y

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DATED 	18th 	January
1999



ABBEY NATIONAL plc

and

MR M MILLINGTON



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CONTRACT OF EMPLOYMENT

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I certify this to be a true copy of the original Contract



| | Gwyn Malkin            
| | -----------------------
| | Solicitor              
| | Legal Services Director
| | Abbey National plc     
| |                        
| |                        
| | 20 January 1999        







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INDEX

|Clause |  | Subject Matter                   | Page
|------ |  | -------------------------------- | ----
|       |  |                                  |     
|1      |  | Title and Duration of Employment | 1   
|       |  |                                  |     
|2      |  | Duties                           | 1   
|       |  |                                  |     
|3      |  | Place and Hours of Work          | 2   
|       |  |                                  |     
|4      |  | Remuneration                     | 3   
|       |  |                                  |     
|5      |  | Pension                          | 3   
|       |  |                                  |     
|6      |  | Car                              | 3   
|       |  |                                  |     
|7      |  | Discretionary Benefits           | 3   
|       |  |                                  |     
|8      |  | Holidays                         | 4   
|       |  |                                  |     
|9      |  | Illness Pay                      | 4   
|       |  |                                  |     
|10     |  | Medical Examinations             | 5   
|       |  |                                  |     
|11     |  | Confidential Information         | 5   
|       |  |                                  |     
|12     |  | Termination of Employment        | 7   
|       |  |                                  |     
|13     |  | Miscellaneous                    | 9   
|       |  |                                  |     
|14     |  | Interpretation                   | 10  

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|CONTRACT OF EMPLOYMENT
|----------------------
|                      
|OF:                   
|                      
|TITLE:                
|                      
|DATED:                

This Contract set out
    the terms on which Abbey National plc ("the Company" or "we" or "us") employs
you.

|1.  | Title and Duration of Employment                                                                                                                                                                                                                                                                                                                  
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                   
|1.1 | The Company will employ you, and you will
        work for us as Group IT Director. We reserve the right at all times throughout
        your employment to amend your job title to take into account the changing
    needs of our business and your role within it.                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                   
|1.2 | Your employment as Group IT Director will
        begin on 1 January 1999 and will continue (subject to earlier termination
        as provided in clause 12 below) until terminated by either the Company's
        giving you 12 months' prior notice in writing or your giving the Company
    6 months' prior notice in writing.              
|    |                                                                                                                                                                                                                                                                                                                                                   
|1.3 | Your continuous employment with the Company
    began on 2 June 1975.                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                   
|1.4 | The Company's retirement age for both men
        and women is the first of the month following their 60th Birthday. Unless
        your employment has terminated at an earlier date, your employment will
    terminate without any further notice on that date.                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                   
|2.  | Duties                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                   
|2.1 | You will at all times during your employment
        (unless prevented by incapacity) devote your whole time and attention
        exclusively to the business of the Company (and any Associated Company
        in which you are or may from time to time be involved) and perform such
    duties as the Board shall from time to time require.

1

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|2.2 | You are responsible to the Board for the
        execution of agreed policies and for effective management of the Company
        towards the achievement of objectives agreed with the Board from time
        to time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2.3 | Subject to the Companies Act 1985 (and any
        Statutory Instruments made thereunder) and the Memorandum and Articles
        of Association of the Company, you will be a member of the Board of Directors
        with effect from 1 January 1999. You will receive a separate letter confirming
    that appointment.                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2.4 | You may also be appointed as a Director of
        any Associated Company on such terms particular to that appointment which
        are additional to and not in substitution for the terms of this Contract
    as the Board may from time to time determine.                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2.5 | You will not without the prior written consent
        of the Board be employed, engaged, concerned or interested or hold any
        directorships in any business or activity other than the business of
        the Company and its Associated Companies save as a registered holder
        of not more than 3% of any class of publicly quoted securities of any
    company.                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|2.6 | You will promptly disclose to us and keep
        confidential all inventions, copyright works, designs or technical know-how
        conceived or made by you alone or with others in the course of your employment.
        You will hold all such intellectual property in trust for the Company
        and will do everything necessary or desirable at our expense to vest
        the intellectual property fully in the Company and/or to secure patent
        or other appropriate forms of protection for the intellectual property.
        Decisions as to the protection or exploitation of any intellectual property
    shall be in the absolute discretion of the Company.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|3.  | Place and Hours of Work                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|3.1 | While your principal place of work will be
        at the Company's office in Milton Keynes, you will work at and/or travel
        to such places (inside or outside the United Kingdom) as your duties
    or the Board may require from time to time.                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|3.2 | You will work such hours (including as a
        minimum the normal office hours of 9.00 a.m. to 5.00 p.m. Monday to Friday
        inclusive at your place of work) as are needed for the proper performance
    of your duties. You will not be entitled to additional pay for overtime.                                                                                                                                                                                                                                                                                                                                                                                                 

2

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|4.  | Remuneration                                                                                                                                                                                                                                                                                                                               
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                            
|4.1 | You will be paid an annual salary of £200,000
        (two hundred thousand pounds) which shall accrue daily and is payable
        by equal monthly instalments on or about the 19th day of each month by
        credit transfer to an account with the Company or to another suitable
    bank account nominated by you.                
|    |                                                                                                                                                                                                                                                                                                                                            
|4.2 | Your salary is deemed to include any fees
        receivable for holding any office of Director in the Company or its Associated
    Companies.                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                            
|4.3 | Your salary will be reviewed by the Remuneration
        Committee in or about December of each year when it may be adjusted dependent
        upon your performance during the year under review. Any such adjustments
        shall be implemented on or about the following January or such other
    time as the Board shall determine.
|    |                                                                                                                                                                                                                                                                                                                                            
|5.  | Pension                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                            
|    | You will be eligible to participate in the
    Company's Pension Scheme subject to its Deed and rules from time to time.                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                            
|6.  | Car                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                            
|6.1 | Subject to your holding a current full driving
        licence for motor cars valid in the United Kingdom you are eligible to
    participate in the Company's car scheme as separately defined and described.                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                            
|6.2 | Should you participate in the Company's car
    scheme, you agree to comply with the terms of the scheme.                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                            
|7.  | Discretionary Benefits                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                            
|7.1 | The Company also provides a number of discretionary
        benefits. The number and type of benefits may vary from time to time
    but they currently comprise                                                                                                                                                                           

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| | (i)   | a concessionary rate mortgage which is subject
        to the Company's normal lending criteria and to any Company Act 1985
    requirement;                                                                                                                                                               
| | ----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                                                                                                                                            
| | (ii)  | a profit sharing scheme, the terms of which
        and the performance criteria shall be advised to eligible employees at
    the time they are made available;                                                                                                                                           
| |       |                                                                                                                                                                                                                                                                                                            
| | (iii) | from time to time the Company may decide
        to offer Executive Management and Executive Committee Bonus Schemes and
        make bonus payments under them at its discretion. The terms of any such
        Schemes will be advised to eligible employees at the time that they are
    made available
| |       |                                                                                                                                                                                                                                                                                                            

|7.2 | These benefits do not form part of your contractual
        terms. Whether the Board may grant, vary or withdraw any or all is within
    its absolute discretion.                                                                                                                                                                                                                                                                                                                                                                                                    
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|8.  | Holidays                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|8.1 | In addition to normal Bank and public holidays,
        you are entitled to 29 working days holiday in each year from January
        to December to be taken at such time or times as are agreed with the
        Chief Executive. You will not, without the consent of the Chief Executive,
        carry forward any unused part of your holiday entitlement to a subsequent
    year.                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|8.2 | For the year during which your appointment
        commences or terminates, your holiday entitlement will be calculated
        pro rata to the number of complete months of your employment by the Company
        during that year. On termination of your appointment (unless you have
        been summarily dismissed under clause 12 below) you will either be entitled
        to pay in lieu of outstanding holiday entitlement or be required to repay
        to the Company any salary received for holiday taken in excess of your
    actual entitlement.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|9.  | Illness Pay                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|9.1 | If you are unavoidably absent from work due
        to illness, injury or other incapacity, you will report this fact to
        the Company before 12 noon, where practicable, on the first day of absence
        and thereafter in accordance with the self-certification and Statutory
        Sick Pay Regulations a copy of which is available for inspection from
    the Personnel Department.                                                                                                                                                                

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|9.2  | If You are absent from work due to illness,
        injury or other incapacity duly certified in accordance with the provisions
        of clause 9.1 above, you will be paid your normal rate of pay for the
        first six months and half rate of normal salary during the next six months
        in accordance with Statutory Sick Pay Regulations provided that such
        remuneration shall be inclusive of any Statutory Sick Pay to which you
    are entitled by law.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|10.  | Medical Examinations                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | During employment on an annual basis and/or
        at any intervening time and at the request and expense of the Company
        you will agree to be examined by a registered medical practitioner to
        be selected by the Company and permit the results to be made available
        to the Chairman of the Board or such other officer of the Company nominated
    by him.                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|11.  | Confidential Information                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|11.1 | You acknowledge:                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|11.2 | You agree that during
        the period of your employment by the Company you will:                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     | (iii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                

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|     |      | your possession or under your control which
        belong to the Company or any Associated Company which contain or refer
    to any Confidential Business Information;                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|---- | ---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (iv) | if so requested by the Company, delete all
        Confidential Business Information from any computer discs, tapes or other
        reusable material in your possession or under your custody or control
        and destroy all other documents and tangible items in your possession
        or under your custody or control which contain or refer to any Confidential
    Business Information.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|     |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|11.3 |      | You agree that you will not at any time after
        termination of your employment disclose to any person, firm or company,
    or make use of, any Confidential Business Information.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|11.4 |      | For the purposes of this paragraph, "Confidential
        Business Information" shall mean all and any information (whether or
        not recorded in documentary form or on computer disc or tape) relating
        to the business methods, corporate plans, management systems, finances
        or financial affairs, maturing new business opportunities or research
        and development projects of the Company or any Associated Company and
        trade secrets, secret formulae, processes, inventions, designs, know-how
        discoveries, technical specifications and other technical information
        relating to the creation, production or supply of any past, present or
        future product or service of the Company or any Associated Company and
        other information to which the Company or any Associated Company attaches
        an equivalent level of confidentiality or in respect of which it owes
    an obligation of confidentiality to any third party
|     |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (i)  | which you shall acquire at any time during
        your employment by the Company (or acquired during any previous employment
    with an Associated Company) and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     | (ii) | which is not readily ascertainable by persons
        not connected with the Company or any Associated Company either at all
    or without a significant expenditure of labour skill or money.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|11.5 |      | Each provision of this clause 11 is independent
        and severable from the remaining provisions and enforceable accordingly.
        If any provision of this clause 11 shall be unenforceable for any reason
        but would be enforceable if part of its wording were deleted it shall
    apply with such deletions as may be necessary to make it enforceable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

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|11.6 |       | You will comply (and ensure that
       your spouse and any minor children comply) with all applicable rules of
       law or codes, London Stock Exchange regulations and any code of conduct
       of the Company from time to time in force in relation to dealings in shares,
    debentures or other securities of the Company or any Associated Company.
|---- | ----- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|12.  |       | Termination of Employment                                                                                                                                                                                                                                                                                                                                      
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|12.1 |       | The Company can dismiss you without
      prior notice or pay in lieu (and you will not be entitled to compensation
    or damages) if you:                                                                                                                                                                                                                    
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (i)   | commit any act of gross misconduct or gross incompetence or repeat or continue (after written warning) any other breach of your obligations under this Contract of Employment; or                                                                                                                                                                              
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (ii)  | are guilty of any conduct which in the reasonable opinion of the Board brings the Company into disrepute; or                                                                                                                                                                                                                                                   
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (iii) | are convicted of any criminal
      offence which in the reasonable opinion of the Company is sufficiently
    serious in nature to warrant your immediate dismissal; or                                                                                                                                                                                       
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (iv)  | commit any act of dishonesty; or                                                                                                                                                                                                                                                                                                                               
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (v)   | become bankrupt or make any arrangement or composition with your creditors generally, suffer any execution against your effects or have an Administration Order made against you; or                                                                                                                                                                           
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (vi)  | if
       you are disqualified from holding office in another company in which you
       are concerned or interested because of wrongful trading under the Insolvency
       Act 1986; or                                                                                                                                                                     
|     |       |                                                                                                                                                                                                                                                                                                                                                                
|     | (vii) | if you are convicted of an offence
      under the Companies Securities (Insider Dealing) Act 1985, or under any
      other present or future statutory enactment or regulations relating to
    insider dealings; or                                                                                                                                         

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|     | (viii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | if you resign as a Director of the Company
        or any Associated Company (otherwise than at the request of the Company
        or by rotation in accordance with the Articles of Association of the
        Company or Associated Company) or otherwise through your own act or default
    cease to be a director of the Company or Associated Company.                                           
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                        
|12.2 | If your employment
        is terminated by reason of redundancy (as defined under the Employment
        Rights Act 1996) you will be entitled to a redundancy payment calculated
    in line with the Executive Manager's Redundancy Agreement.                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                        
|12.3 | Upon termination
        of this contract (for whatever reason) you will, at the request of the
    Company,                                                                                                                                                                                                                                                                                                                                                                                                             
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                        
|     | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       | resign from office as a Director of the Company
        and of any Associated Companies without claim for compensation and, in
        the event of your failure to do so, the Company is hereby irrevocably
        authorised to appoint some person in your name and on your behalf to
        sign and deliver such resignation or resignations to the Company and
    to any Associated Companies;
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                        
|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | return all the Company's or Associated Company's
        documents, computer discs or tapes and all other property in your possession
        and control belonging to or containing any confidential information of
    the Company's business which you have received as a Director.                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                        
|12.4 | Notwithstanding
        the termination of this Contract, its terms shall remain in full force
        and effect to the extent that and in respect of any of your obligations
        which are expressed to operate after termination or are of a continuing
    nature and may be enforced against you accordingly.                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                        
|12.5 | If your employment
        under this contract is terminated by reason of the liquidation of the
        Company for the purpose of reconstruction or amalgamation and you are
        offered employment with any concern or undertaking resulting from the
        reconstruction or amalgamation on terms and conditions no less favourable
        than the terms of this Contract then you shall have no claim against
        the Company in respect of the termination of your employment under this
    Contract.





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|12.6 | If either you or
       the Company serves notice on the other to terminate your employment the
Company may in its absolute discretion either pay you in lieu of notice or require
you to take 'garden leave' for all or part of the remaining period of your employment.
|---- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                          
|     | If you are asked to take garden
    leave you:                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                          
|     | (i)                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                          
|     | (ii)                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                          
|     | (iii)                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                          
|     | (iv)                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                          
|     | (v)                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                          
|     | During any period
      of garden leave you will continue to receive your full salary and
benefits.                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                          
|13.  | Miscellaneous                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                          
|13.1 | The further particular terms of
      employment which must be given to you under the Employment Rights Act 1996
    are:                                                                                                                                                
|     |                                                                                                                                                                                                                                                                          
|     | (i)                                                                                                                                                                                                                                                                      

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|     | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    | Any disciplinary or grievance matter between
        you and the Company will be dealt with between you and the Chief Executive
    or such other director as the Chief Executive may nominate.
|---- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                                                                                                                                                                                                
|13.2 | This Contract and the documents
        referred to sets out the entire agreement and understanding between you
        and the Company and is, subject to the provisions under clause 1.3 relating
        to continuity of employment, in substitution for any previous contracts
        of employment or for services, all of which are deemed to have been terminated
    by mutual consent.                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|13.3 | Your terms and conditions of
        employment are reviewed by the Remuneration Committee from time to time.
        You will be notified in writing by the Company of any changes to these
    terms and conditions.                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|13.4 | The Company will reimburse to
        you all travelling, hotel, entertainment and other expenses reasonably
        incurred by you in the proper performance of your duties subject to your
        complying with Company guidelines issued from time to time in this respect
        and to the production to the Company of such vouchers or other evidence
    of actual payment of the expenses as the Company may reasonably require.                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|13.5 | We will issue you with a charge
        or credit card which you must only use for Company and Associated Company
    business purposes.                                                                                                                                                                                                                                                                                                                                                               
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|13.6 | Any notice given under this contract
        must be in writing. If you wish to terminate your employment, notice
        will be regarded as properly served if you give it to the Chief Executive
        of the Board or send it by post to the Chief Executive at the Company's
        registered office. If the Company wishes to terminate your employment,
        notice will be regarded as served if given to you personally or if sent
    by prepaid post to your last known home address.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|14.  | Interpretation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|14.1 | Any reference in this Contract
        to any Act or legislation made under any Act shall include any statutory
    modification or re-enactment of it or the provision referred to.                                                                                                                                                                                                                                                                                                                   







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|14.2                                                                       | "Associated Company" means
          a subsidiary and any other company which is for the time being a holding
          company of the Company or another subsidiary of any such holding company
          and the expressions "subsidiary company" and "holding company" shall
          have the meaning given to them under Section 736 of the Companies Act
          1985,
or such othercompany or joint venture arrangement
in which the Company has or from time to time has an interest.
|-------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|14.3                                                                       | "The Board" means the Board
          of Directors of Abbey National plc for the time beingincluding
    any committee of the Board duly appointed by it.                                                                                                                                                                                                                                                                                                                                       
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|14.4                                                                       | "The Chairman" means the person for the time
    being who is Chairman of the Board.                                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|14.5                                                                       | "The Chief Executive" means the person for
    the time being who is Chief Executive of the Company.                                                                                                                                                                                                                                                                                                                                                                                            
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|14.6                                                                       | The "Remuneration Committee" means a committee
    for the time being of the Board who are non-executive directors.                                                                                                                                                                                                                                                                                                                                                                             
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|14.7                                                                       | This Contract is governed by and shall be
        construed in accordance with English law and the English Courts shall
    have exclusive jurisdiction.                                                                                                                                                                                                                                                                                                                                        
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|This contract is
    executed as a Deed on the date first mentioned above.
|                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 



|The Common Seal ofABBEY NATIONAL plc was
hereunto affixed by Order
of the
        Board of Directors in the presence
    of: | 
|---------------------------------------------------------------------------------------------------------------------------- | 







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