Exhibit
    4.16

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mmO2 plc







|                                                   
|---------------------------------------------------
|                                                   
|                                                   
|THE
      mmO2 DEFERRED
      EQUITY INCENTIVE PLAN
|                                                   





As adopted
  by the Board of the Company on 13 May 2004
  [and approved by mmO2 plc in general meeting on 28 July 2004].

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Draft

THE
  RULES OF THEmmO2
  DEFERRED
  EQUITY INCENTIVE PLAN

|1.  | HOW
      THE PLAN WILL OPERATE                                                                                                                                                      
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                      
|1.1 | Policies
      set by the Board                                                                                                                                                      
|    |                                                                                                                                                                                      
|    | The
      Board will set the policies for the Companys operation and administration
      of the Plan within the terms of the Rules, which shall include the determination
      of:
|    |                                                                                                                                                                                      
|    | 1.1.1                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 1.1.2                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 1.1.3                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 1.1.4                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 1.1.5                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 1.1.6                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 1.1.7                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | The
      Board can change any of its policies at any time but it cannot change its
      policies to the detriment of a Participants subsisting Awards.                            
|    |                                                                                                                                                                                      
|2.  | GRANT
      OF AWARDS                                                                                                                                                                
|    |                                                                                                                                                                                      
|2.1 | Amount
      of Awards                                                                                                                                                               
|    |                                                                                                                                                                                      
|    | 2.1.1                                                                                                                                                                                
|    |                                                                                                                                                                                      
|    | 2.1.2                                                                                                                                                                                
|    |                                                                                                                                                                                      

1

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Draft

|    | 2.1.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Whenever the Company
      makes a Deferred Award, it shall also make a Performance Uplift Award relating
      to up to double the number of Shares comprised in the Deferred Award.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|2.2 | When
      Awards will be granted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | Awards
      can be granted at any time except during a Close Period.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|2.3 | Award
      Certificate                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | Each
      Award shall be evidenced by an Award certificate, signed on behalf of the
      Company.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|2.4 | Awards
      personal to Participants                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | Awards
      cannot be transferred, assigned, charged or otherwise disposed of. On the
      death of a Participant, his Awards can be transmitted to his personal representatives.
      A Participant can renounce his Award within 30 days following the Date of
      Grant and, to the extent renounced, the Award will be treated as if it had
      never been granted.                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|3.  | LIMIT
      ON THE NUMBER OF SHARES WHICH CAN BE ISSUED                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|3.1 | The
      limit for all Shares issued under the Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | The
      number of Shares which can be allocated under the Plan on any day, when
      aggregated with the number of Shares allocated in the previous 10 years
      under any other Employees Share Scheme, cannot exceed 10 per cent.
      of the ordinary issued share capital of the Company from time to time.                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|3.2 | Meaning
      of allocation and exclusion from these limits                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | The
      references in this Rule 3 to the allocation of Shares mean,
      in the case of any share option plan, the placing of unissued Shares under
      option and, in the case of any other Employees Share Scheme, the issue
      and allotment of Shares. For the purposes of the limit in this Rule 3:                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | 3.2.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Shares where the
      right to acquire such Shares was released, cancelled or lapsed without being
      exercised will be ignored; and                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | 3.2.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | to the extent that
      the Vesting of Awards is to be satisfied by the transfer of Shares already
      in issue, those Awards will not be treated as granted over unissued Shares.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|3.3 | Adjustment
      to Shares to be taken into account                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |                                                                                                                                                                                      
|    | Where
      Shares issued under the Plan or any other Employees Share Scheme of
      the Company are to be taken into account for the purposes of any of the
      limits in this Rule 3 and a Variation in the equity share capital of the
      Company has taken place between the date of issue of any such Shares and
      the date on which any such limit is to be calculated, the number of such
      Shares which will be taken into account for the purposes of any such limit
      will be adjusted in such manner as the Board considers appropriate to take
      account of the Variation.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              

2

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Draft

|4.  | VESTING
      OF AWARDS                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|4.1 | Deferred
      Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | Subject
      to these rules a Deferred Award will Vest on the Vesting Date.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|4.2 | Performance
      Uplift Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | Subject
      to these rules a Performance Uplift Award will Vest on the Vesting Date
      to the extent that the Performance Condition has been satisfied. If the
      Performance Condition has not been satisfied or has not been satisfied in
      full, the Performance Uplift Award, or part thereof, will lapse to the extent
      the Performance Condition has not been satisfied.                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|5.  | RIGHTS
      IN RELATION TO SHARES PRIOR TO THE VESTING OF A DEFERRED
      AWARD OR PERFORMANCE UPLIFT AWARD                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|5.1 | Voting
      rights, dividends and other rights                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | A Participant
      has no voting rights attaching to the Shares the subject of his Award, nor
      a right to any dividends nor other rights attaching to the Shares the subject
      of such Award prior to the Vesting of the Award in respect of those Shares.
      However, the Company may increase the number of Shares the subject of a
      Participants Award after any dividend has been paid by the Company.
      Any such increase will be equal to such number of Shares whose Market Value
      on the date any dividend has been paid by the Company is as close as possible
      equal to a sum equivalent to the aggregate dividend (net of any taxes) which
      has been paid in respect of the number of Shares which is equal to the number
      of Shares under a Participants Award.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|5.2 | Events
      which affect the share capital of the Company                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | If there
      is a Variation affecting the share capital of the Company prior to the Vesting
      of an Award, the Company will adjust the number of Shares the subject of
      that Award. Any Participant whose Award is adjusted will be notified in
      writing of any such adjustment.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|6.  | GENERAL
      OFFER, SCHEME OF ARRANGEMENT OR VOLUNTARY WINDING-UP
      OF THE COMPANY                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|6.1 | General
      offer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | If, before
      an Award has Vested, an offeror (either alone or together with any party
      acting in concert with him) obtains Control of the Company as a result of
      a general offer to
      acquire the whole of the issued ordinary share capital of the Company (or
      such part of it which is not at the time owned by the offeror and any party
      acting in concert with the offeror) then:                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

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Draft

|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | a Participants
       Deferred Award will Vest as soon as the change of Control takes effect;
       and                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | subject to rule 6.2, a Participants Performance Uplift Award will Vest to the extent that the Performance Condition has been satisfied on the date of the change of Control, and the number of Shares comprised in the Performance Uplift Award that Vests shall be multiplied by the fraction A/B (where A is that part of the Performance Period measured in complete months from the Date of Grant to the date on which the change of Control occurs and B is 36).                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|6.2 | The
    discretion of the Board in relation to Performance Uplift Award                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | The
      Board will confirm as soon as practicable after the general offer has become
      or been decided unconditional the extent to which a Performance Uplift
      Award may Vest and the extent that the Performance Condition has been satisfied
      up to the change of Control taking effect. Subject to this, the Board may
      decide to take other factors into account, which it believes to be relevant
      in permitting the Performance Uplift Award to Vest below or beyond the
    extent to which the Performance Condition has been met.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|6.3 | Extension
    to Participants of general offer                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | The
      Company will use its best endeavours to procure that to the extent a Participants
      Award Vests in accordance with Rule 6.1 or 6.2, the offeror will make an
      offer to acquire from the Participant his Shares on the same terms as Shares
    of the same class were acquired under the general offer.                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|6.4 | Scheme
    of arrangement                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | If,
      before an Award has Vested, the court directs that a meeting of the holders
      of Shares should be convened under Section 425 of the Companies Act 1985
    to consider a scheme of arrangement, then:                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | a Participants
      Deferred Award will Vest on the date the scheme of arrangement is sanctioned
    by the court; and                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | (b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | subject
      to rule 6.5, a Participants Performance Uplift Award will Vest to
      the extent that the Performance Condition has been satisfied on the date
      the scheme of arrangement is sanctioned by the court , and the number of
      Shares comprised in the Performance Uplift Award that Vests shall be multiplied
      by the fraction A/B (where A is that part of the Performance Period measured
      in complete months from the Date of Grant to the date on which the court
    sanctions the scheme of arrangement and B is 36)
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    | If
      however, the purpose and effect of the scheme of arrangement is to create
      a new
      holding company for the Company, where such holding company would, following
      the scheme of arrangement, have substantially the same shareholders and
      proportionate shareholdings as those of the Company immediately prior to
      the scheme of arrangement, Rule 6.7 will apply (unless the Board, acting
      fairly and reasonably, determines that it should not apply). If it does
    apply, Awards will not Vest under this Rule 6.4.    

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Draft

|6.5 | The discretion
    of the Board in relation to Performance Uplift Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | The Board will
        confirm as soon as practicable after the date of the courts direction
        the extent to which a Performance Uplift Award may Vest and the extent
        that the Performance Condition has been met up to the date the scheme
        of arrangement is sanctioned by the court. Subject to this, the Board
        may decide to take other factors into account, which it believes to be
        relevant in permitting the Performance Uplift Award to Vest below or
    beyond the extent to which the Performance Condition has been met.                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.6 | Voluntary
    winding-up                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | If there is a resolution
        for a members voluntary winding-up of the Company, the Board may,
        in its absolute discretion, determine that Awards may Vest in full conditionally
    on the resolution being passed.                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|6.7 | The exchange
    of Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | If, before an
        Award has Vested, any company (the Acquiring Company) obtains
        Control of the Company in pursuance of a compromise or arrangement sanctioned
        by the court under Section 425 of the Companies Act 1985 and the Acquiring
        Company has agreed that the outstanding Awards should continue, Participants Awards
        (Old Awards) will become Awards (New Awards)
        in respect of shares in the Acquiring Company. Each New Award will be
        equivalent to each Old Award before the change of Control. The New Awards
    will not be regarded as equivalent to the Old Awards unless:     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | (i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | (ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | References
        to Shares will, in relation to the New Award, be taken as references
        to shares of the company whose shares are under New Awards. References
        to the Company shall be taken to be references to the company whose shares
        are under the New Awards, where appropriate. The New Awards will not
        Vest/lapse if Rule 6 applies following and in respect of the change of
    Control which led to the grant of the New Awards. The Trustee will      agree to any amendment
      to the applicable employee share ownership trust to give effect to this
    Rule 6.7. This Rule 6.7 is subject to Rule 6.4.

5

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Draft

|7.  | CEASING
    TO BE IN EMPLOYMENT DURING THE VESTING PERIOD                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.1 | Ceasing
    to be in Employment: generally                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Unless otherwise
        provided in the Rules, if a Participant ceases to be in Employment before
        the end of the Vesting Period, all his Awards will lapse in full on the
    date he so ceases.                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.2 | Ceasing
    to be in Employment because of death, ill health or disability                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | If a Participant
        ceases or is to cease to be in Employment before the end of the Vesting
        Period because of death, ill health or disability, the Participants
        Award will, subject to Rule 7.6, be preserved until the end of the Vesting
    Period and remain subject to the Rules.                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.3 | Ceasing
    to be in Employment because of the sale of a company or business                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | If a Participant
        ceases to be in Employment before the end of the Vesting Period because
        the company in the Group which employs him ceases to be a Participating
        Company or an Associated Company or because of the transfer or sale of
        the undertaking (or part of the undertaking) in which he is employed
        to a person who is neither a Participating Company nor an Associated
        Company, all his Awards will, subject to Rule 7.6, be preserved until
    the end of the Vesting Period and remain subject to the Rules.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.4 | Ceasing
    to be in Employment in other circumstances                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | If, before the
        end of the Vesting Period, a Participant gives or is given notice to
        leave Employment or ceases to be in Employment in any circumstances other
        those referred to in Rules 7.2 and 7.3, his Award will lapse on that
        date, unless the Board exercises its discretion and decides otherwise
        or unless, (being female) she is entitled to exercise and subsequently
        does exercise the statutory right (or any corresponding contractual right)
    to resume Employment after an absence due to pregnancy.    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | If the Board exercises
        its discretion so that Awards do not lapse, the Board may, in its absolute
        discretion, Vest the Awards or preserve the Awards until the Vesting
    Date.                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|7.5 | Preservation
    of Awards under Rule7                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    | Where an Award
        is preserved pursuant to rules 7.2 to 7.4, when that Award vests on the
        Vesting Date the Board may in its absolute discretion, determine that
        the number of Shares comprised in such Award be reduced pro rata for
    the part of Vesting Period for which the Participant was not in Employment.                                                                                                                                                                                                                                 

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Draft

|7.6 | Ceasing
    to be in Employment  early Vesting                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | Notwithstanding
        Rules 7.2 and 7.3, the Board may, in circumstances which, in the Boards
        opinion, are exceptional, Vest an Award on the date a participant ceases
        employment for any reason. The performance condition shall be applied
    to the Performance Uplift Awards in such manner as the Board thinks fit.                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7.7 | The effect
    of the lapsing of Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | To the extent that
        a Participants Award lapses, he is not entitled to any Shares which
    are the subject of that Award.                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8.  | TRANSFER
    OF SHARES                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8.1 | Deferred
    Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | At the end of the
        Vesting Period and to the extent that a Deferred Award has not already
        Vested under these Rules or lapsed, the Company will procure that the
        relevant number of Shares comprised in the Deferred Award are transferred
    to a Participant within 30 days of the Vesting Date.                                                                                                                                                                        
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | Where the Board
        has Vested a Deferred Award prior to the end of the Vesting Period, the
        Company will procure that the relevant number of Shares comprised in
        the Deferred Award is transferred to the Participant within 30 days of
    the Vesting Date .                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8.2 | Performance
    Uplift Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | At the end of the
        Vesting Period, to the extent that a Performance Uplift Award has not
        already Vested under these Rules or lapsed, the Company shall procure
        the transfer of the relevant number of Shares comprised in a Performance
        Uplift Award (reduced the extent the Performance Condition has not been
        satisfied in full and/or reduced in accordance with these Rules if applicable),
    to the Participant within 30 days of the Vesting Date.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8.3 | Sale
    of Shares to satisfy a Participants Tax Liability                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | Unless the Participant
        makes arrangements (satisfactory to the Company) to provide payment in
        respect of his Tax Liability, the Company or any relevant company in
        the Group will make arrangements to sell on behalf of the Participant
        such number of Shares the subject of the Award which has Vested as is
    necessary to discharge the Tax Liability.                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|9.  | AMENDING
    THE PLAN                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|9.1 | The Company
    has discretion to amend the Rules                                                                                                                                                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|    | Subject to the
    rest of this Rule 9, the Company can amend the Rules at any time.                                                                                                                                                                                                                                                                                                                                                                                                             

7

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|9.2  | Additional
    sections                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|---- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | The Company can
        adopt additional sections of the Rules applicable in any jurisdiction
        under which Awards may be subject to as additional and/or modified terms
        and conditions, having regard to any securities, exchange control or
        taxation laws, which may apply to the Participant, the Company, any Participating
        Company or Associated Company. Any additional sections must conform to
        the basic principles of the Plan and must not enlarge to the benefit
    of Participants the limits in the Rules.
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|9.3  | No abrogation
    of existing rights                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | No amendment will
        be made under Rule 9.1 which would abrogate or materially affect adversely
        the existing rights of a Participant unless it is made with his written
        consent or by a resolution passed as if the Awards constituted a separate
        class of share capital and the provisions of the Articles of Association
        of the Company and of the Companies Act 1985 relating to class meetings
    (with the necessary amendments) applied to that class.                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|9.4  | Shareholder
    approval                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | No amendment to
        the advantage of Participants or Eligible Executives (except for an amendment
        which could be included in an additional section adopted under Rule 9.2)
    can be made to the provisions in the Rules (if any) relating to:                                                                                                                                                                                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | 9.4.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | 9.4.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | 9.4.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | without the approval
        by ordinary resolution of the Company in general meeting, except minor
        amendments to benefit the administration of the Plan, to take account
        of a change in legislation or to obtain or maintain favourable tax, exchange
        control or regulatory treatment for Participants or Eligible Executives
    or for a member of the Group.                                                                                                                                                                      
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|10.  | GENERAL                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|10.1 | Notices                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|     | Any
        notice or other communication in connection with the Plan (including,
        if permitted, Award certificates) can be given by electronic mail or
        by personal delivery or by post, (in the case of a company, to its registered
        office and in the case of an individual to his last known address) or
        by any other means which a Participating Company and its employees use
    to communicate with                                                                                                                     

8

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Draft

|     | each
      other. Where a notice or other communication is given by first-class post,
      it shall be deemed to have been received 72 hours after it was put into
    the post properly addressed and stamped.                                                                                                                                                                                                                                                                               
|---- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.2 | Documents sent to shareholders                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | Participants
       may, but are not entitled to,receive
       copies of any notice ordocument
       sent by the Company to the holders of Shares.                                                                                                                                                                                                                                                                                                                                           
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.3 | Replacement Award certificates                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | If
       any Award certificate is worn out, defaced or lost, it can be replaced
       on suchevidence
       being provided as may be required.                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.4 | Shares to cover Awards                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | Enough
       Shares will be available on maturityto
       satisfy all Awards Vesting.                                                                                                                                                                                                                                                                                                                                                                                                        
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.5 | Administration of the Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | The
      Plan will be administered in a manner approved by the Company. No individual
      will have any authority in relation to the Plan unless that authority has
      been approved in accordance with the policy set by the Board. The Companys
      or the Boards decision on any matter concerning the Plan, including
      whether or not the Performance Condition in relation to an Award has been
    met, or the interpretation of the Rules, will be final and binding.    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.6 | Costs
    of introducing and administering the Plan                                                                                                                                                                                                                                                                                                                                                                                                                                            
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | The
      costs of introducing and administering the Plan will be borne by the Company.
      However, the Company can require any Participating Company to enter into
      such arrangement to reimburse the Company for any costs borne by the Company
      directly or indirectly in respect of such Participating Companys
    officers or employees.                                                                                                                                   
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.7 | Termination
    of the Plan                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | The
      Plan will terminate at the end of the Plan Period or at any earlier time
      the Company shall decide. Termination of the Plan will not affect the subsisting
    Awards of Participants.                                                                                                                                                                                                                                                                                          
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|10.8 | Rights
    of Participants and Eligible Employees                                                                                                                                                                                                                                                                                                                                                                                                                                              
|     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|     | Participation
      in the Plan is not pensionable. Nothing in the Plan nor in any instrument
      executed pursuant to it will confer upon any person any right to continue
      in the employment of the Group, or will affect the right of the Company
      or any company in the Group to terminate the employment of any person without
      liability at any time with or without cause, or will impose upon the Group
    or the Trustee or the Board or their respective agents and

9

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Draft

|      | employees
        any liability whatsoever (whether in contract, tort, or otherwise howsoever)
    in connection with:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|----- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | 10.8.1                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | 10.8.2                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | 10.8.3                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.9  | Waiver
    of any rights                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | Any
        person who ceases to have the status or relationship of an employee or
        executive director with the Company or any other company in the Group
        for any reason as a result of dismissal (lawful or otherwise) shall not
        be entitled and shall be deemed irrevocably to have waived any entitlement
        by way of damages for dismissal or by way of compensation for loss of
        office or otherwise to any sum, damages, Shares or other benefits to
        compensate that person for the loss of any rights, benefits or expectations
    under any Award, the Plan or any instrument executed pursuant to it.                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.10 | The
    Benefit of Rule 10.8 and Rule 10.9                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | The
        benefit of Rule 10.8 and Rule 10.9 is given for the Company and/or the
        Trustee (where the Award was not granted by the Company), as appropriate
        for itself and as trustee and agent of the Company (if the benefit is
        given for the Trustee), and of all the Companys Subsidiaries or
        any of its Associated Companies or Associated Undertakings. To the extent
        that the Company, any Subsidiary, Associated Company or Associated Undertaking
        of the Company is not party to the grant of an Award, the Company and/or
        the Trustee, as appropriate, will hold the benefit of Rule 10.8 and Rule
        10.9 on trust and as agent for each of them and the Company and/or the
        Trustee may, at their respective discretion, assign the benefit of this
    Rule 10.10 to any of them.
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.11 | Awards
    are subject to the Rules                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | Awards
    are granted incorporating and subject to the Rules.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.12 | Articles
    of association                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | Any
        Shares acquired on the Vesting of Awards are subject to the Articles
    of Association of the Company as amended from time to time.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|10.13 | Governing
    law                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|      | The
        Rules are governed by and interpreted in accordance with the law of England.
    Each Participant, the Company and any other Participating                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

10

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Draft

| | Company or Associated
        Company submits to the jurisdiction of the English courts in relation
        to anything arising under the Plan. The Company may, in its absolute
        discretion, determine that another law may apply to the application of
    the Plan outside the United Kingdom.
| | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

11

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Draft

THE mmO2 DEFERRED
EQUITY INCENTIVE PLAN

DEFINITIONS APPENDIX

The words and expressions used in the Rules which have capital letters have the meanings set out below. In the Rules:

| | (i)   | the headings are for the sake of convenience only and should be ignored when construing the Rules;                                                                              
| | ----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |       |                                                                                                                                                                                 
| | (ii)  | reference to any statutory provisions are to those provisions as amended, extended or re-enacted from time to time, and include any subordinate legislation made under them; and
| |       |                                                                                                                                                                                 
| | (iii) | unless
      the context requires otherwise, words in the singular include the plural
      and vice versa and words
imputing either gender include both genders.               



|1.                         | DEFINITIONS                                                                                                                                                                                                                                                                                                                               
|-------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                           |                                                                                                                                                                                                                                                                                                                                           
|Associated
    Company     | in relation
    to the Company:                                                                                                                                                                                                                                                                                                           
|                           |                                                                                                                                                                                                                                                                                                                                           
|                           |                                                                                                                                                                                                                                                                                                                                           
|                           |                                                                                                                                                                                                                                                                                                                                           
|                           |                                                                                                                                                                                                                                                                                                                                           
|                           |                                                                                                                                                                                                                                                                                                                                           
|Associated
    Undertaking | a
        company or partnership in which the Companyhas
    an interest through a shareholding orotherwise;                                                                                                                                                                                                                              
|                           |                                                                                                                                                                                                                                                                                                                                           
|Award                      | a
        Deferred Award and the Performance UpliftAward
    linked to that Deferred Award;                                                                                                                                                                                                                                               
|                           |                                                                                                                                                                                                                                                                                                                                           
|Board                      | the
        board of directors for the time being of theCompany
    or a duly authorised committee of it;                                                                                                                                                                                                                                 
|                           |                                                                                                                                                                                                                                                                                                                                           
|Close
    Period           | a
        period when the members of the Board of the Company are prohibited from
        dealing in Shares under the Criminal Justice Act 1993, or the Financial
        Services Authority model code on transactions in securities, or under
        any other statute, regulation or similar code to which the Company is
    subject;
|                           |                                                                                                                                                                                                                                                                                                                                           
|the
    Company            | mmO2plc
        (registered no. 4190833) which, forthe
    purposes of the Rules, may act through the                                                                                                                                                                                                                                     

12

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Draft

|                            | Board or through
    any two employees of the Group authorised to act in accordance with the policies
    established under Rule 1;                                                                                                                                                       
|--------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                            |                                                                                                                                                                                                                                                                                           
|Control                     | has the
    meaning given by Section 840 of the Taxes Act;                                                                                                                                                                                                                                
|                            |                                                                                                                                                                                                                                                                                           
|Date of
    Grant           | in relation
    to an Award, the date on which that Award is granted;                                                                                                                                                                                                                     
|                            |                                                                                                                                                                                                                                                                                           
|Dealing
    Day             | a day on
    which the London Stock Exchange is open for the transaction of business;                                                                                                                                                                                                     
|                            |                                                                                                                                                                                                                                                                                           
|Deferred
    Award          | a conditional
        right to acquire Shares which has been granted under the Plan or is proposed
    to be granted under the Plan;                                                                                                                                                      
|                            |                                                                                                                                                                                                                                                                                           
|Definitions
    Appendix    | this appendix
    which forms part of the Rules;                                                                                                                                                                                                                                          
|                            |                                                                                                                                                                                                                                                                                           
|Eligible
    Executive      | any person
        (including one who is a director of the Company) who, at the Date of
    Grant, is an employee of the Company or a Subsidiary;                                                                                                                                         
|                            |                                                                                                                                                                                                                                                                                           
|Employees Share
    Scheme | an employees share
        scheme (as defined by Section 743 of the Companies Act 1985) established
    by the Company (excluding the Legacy Plan);                                                                                                                                      
|                            |                                                                                                                                                                                                                                                                                           
|Employment                  | employment
    as an employee of a Participating Company or an Associated Company;                                                                                                                                                                                                        
|                            |                                                                                                                                                                                                                                                                                           
|Group                       | Participating
    Companies and Associated Companies;                                                                                                                                                                                                                                     
|                            |                                                                                                                                                                                                                                                                                           
|Legacy Plan                 | The mmO2
        Legacy Option Plan under which options have been granted to employees
        of the Group in consideration for the release of equivalent options over
        shares in British Telecommunications PLC which were granted under that
    companys share option schemes;
|                            |                                                                                                                                                                                                                                                                                           
|London Stock
    Exchange   | the London
        Stock Exchange Limited (or any successor body carrying on the business
        of the London Stock Exchange) or, where the context so requires, the
        New York Stock Exchange or any other exchange on which the Shares are
    listed or traded;                

13

---





Draft

|Market Value                 | in relation
        to a Share on any day, an amount equal to its middle market quotation
        (as derived from the Daily Official List of the London Stock Exchange)
        on, at the discretion of the Company, that day or the Dealing Day immediately
        preceding that day or the average middle market quotation of the three
    Dealing Days immediately preceding that day;
|---------------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Participant                  | an Eligible Executive
        to whom an Award has been granted, or (where the context requires) his
    personal representatives;                                                                                                                                                                                                                                                            
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Participating
    Company    | the Company and
    any Subsidiary designated by the Board as a Participating Company;                                                                                                                                                                                                                                                                                                        
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Performance
    Uplift Award | a conditional right
        to acquire Shares under the Plan which has been granted or is proposed
    to be granted under the Plan;                                                                                                                                                                                                                                                          
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Performance
    Condition    | the condition set
        out in the Schedule to the Plan or such other objective conditions as
        may be imposed by the Board on the Grant Date for a Performance Uplift
    Award;                                                                                                                                                                                                     
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Plan                         | the mmO2 Deferred
    Equity Incentive Plan constituted by the Rules;                                                                                                                                                                                                                                                                                                                         
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Plan Period                  | the period starting
        on the date on which the Plan is approved by the Company in general meeting
    and ending on the tenth anniversary of that date;                                                                                                                                                                                                                                 
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Rules                        | the rules of the
    Plan, including the Definitions Appendix, as amended from time to time;                                                                                                                                                                                                                                                                                                  
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Share                        | a fully paid ordinary
    share in the capital of the Company;                                                                                                                                                                                                                                                                                                                                
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Subsidiary                   | a company which
        in relation to the Company is a company as defined by Section 736 of
    the Companies Act 1985;                                                                                                                                                                                                                                                                      
|                             |                                                                                                                                                                                                                                                                                                                                                                                               
|Taxes Act                    | the Income and Corporation
    Taxes Act 1988;                                                                                                                                                                                                                                                                                                                                                

14

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Draft

|Tax Liability               | in relation to a
        Participant, the amount of all taxes and/or national insurance contributions
        or any other contribution which any company in the Group is required
        to, or may account for and on behalf of or, if permitted, in respect
    of that Participants Award;
|--------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                            |                                                                                                                                                                                                                                                                                                 
|Trustee                     | the
        trustee from time to time of an employee share ownership trust established
        by the Company as an EmployeesShare
    Scheme;                                                                                                                                                 
|                            |                                                                                                                                                                                                                                                                                                 
|Variation                   | means:                                                                                                                                                                                                                                                                                          
|                            |                                                                                                                                                                                                                                                                                                 
|                            | (i)                                                                                                                                                                                                                                                                                             
|                            |                                                                                                                                                                                                                                                                                                 
|                            |                                                                                                                                                                                                                                                                                                 
|                            |                                                                                                                                                                                                                                                                                                 
|                            |                                                                                                                                                                                                                                                                                                 
|                            |                                                                                                                                                                                                                                                                                                 
|                            | (ii)                                                                                                                                                                                                                                                                                            
|                            |                                                                                                                                                                                                                                                                                                 
|                            | which
    would, in the opinion of the Company, justify an adjustment to any Award;                                                                                                                                                                                                             
|                            |                                                                                                                                                                                                                                                                                                 
|Vest, Vested
    or Vesting | in relation
        to an Award, the point at which a Participant becomes absolutely entitled
    to all or some of the Shares the subject of that Award;                                                                                                                                       
|                            |                                                                                                                                                                                                                                                                                                 
|Vesting
    Date            | the
    third anniversary of the Date of Grant;                                                                                                                                                                                                                                                 
|                            |                                                                                                                                                                                                                                                                                                 
|Vesting
    Period          | the
    period of 3 years between the Date of Grant and the Vesting Date;                                                                                                                                                                                                                       

15

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Draft

SCHEDULE1

PERFORMANCE CONDITION

|    | applying
          to Performance Uplift Awards granted on [    ]
    July 2004                                     
|--- | --------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                     
|1.  | DEFINITIONS                                                                                                         
|    |                                                                                                                     
|1.1 | Under
        this Performance Condition, the following words and expressions shall
    have the following meanings:
|    |                                                                                                                     
|    | Average
    Market Value                                                                                            
|    |                                                                                                                     
|    | Base Date                                                                                                           
|    |                                                                                                                     
|    | Comparator
    Group                                                                                                
|    |                                                                                                                     
|    | Final Date                                                                                                          
|    |                                                                                                                     
|    | Performance
    Period                                                                                              
|    |                                                                                                                     
|    | Total Shareholder
    Return or TSR                                                                                 
|    |                                                                                                                     
|    |                                                                                                                     
|    |                                                                                                                     
|    |                                                                                                                     
|    |                                                                                                                     
|    |                                                                                                                     

16

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Draft

|TSR Ranking | means,
        in respect of the Final Date, the ranking of the Total Shareholder Return
        of the companies in the Comparator Group and the Company over the Performance
        Period where the company with the highest Total Shareholder Return has
    the highest percentile.
|----------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|    |                                                                                                                                                
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------
|1.2 | All the words and
        expressions defined in the rules of the Plan shall bear the same meaning
    when used in this Performance Condition.
|    |                                                                                                                                                
|1.3 | References to paragraph
    numbers refer to paragraphs of this Performance Condition.                                                         
|    |                                                                                                                                                
|2.  | VESTING
    OF PERFORMANCE UPLIFT AWARD                                                                                                        
|    |                                                                                                                                                
|2.1 | A Performance Uplift
        Award will, subject to the Rules, Vest to the extent that this Performance
        Condition
provides.            
|    |                                                                                                                                                
|2.2 | The percentage of
        Shares under a Performance Uplift Award which Vests shall be determined
        by reference
to the table below:     
|    |                                                                                                                                                

|TSR Ranking of the
        Company   | Percentage ofPerformance
        UpliftAward
    Vesting
|------------------------------------ | --------------------------------------------------------
|80th percentile                      | 100%                                                    
|Between 50th and
    80th percentile | Pro rata between
    30% and 100%                       
|50th percentile                      | 30%                                                     
|Below 50th percentile                | 0%                                                      

|    |                                                                                                                                                                                                                                                                  
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|2.3 | The Comparator Group
    shall include the Company.                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                  
|2.4 | If the Performance
        Condition is not satisfied in full at the end of the Performance Period,
        any portion of
the Performance Uplift Award that has not Vested as a consequence of this Performance
    Condition not being met in full shall lapse.

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|2.5 | Any fraction of
        a Share
arrived at by applying the Performance Condition shall be ignored.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|3.  | CALCULATION
    OF TOTAL SHAREHOLDER RETURN                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|3.1 | As soon as practicable
        following the end of the Performance Period the Board shall calculate
        the TSR Ranking for the Performance Vesting Period and specify the Company's
        position in such TSR ranking. The Company shall, having completed such
        calculations, inform the Participant of the extent to which (if at all)
        the Performance Condition has been satisfied. Such determination shall
        be final and binding in the absence
of manifest error.                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|3.2 | The Board reserves
        the power to amend the Performance Condition as it considers appropriate
        provided that any amendment shall not, in the opinion of the Board, make
        the amended Performance Condition less demanding than the original Performance
        Condition was intended
to	be.                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|3.3 | If any member of
        the Comparator Group ceases to exist, its shares cease to be traded on
        a recognised stock exchange, or otherwise is so changed as to make it,
        in the opinion of the Board, unsuitable as a member of the Comparator
        Group, the Board may, in its absolute discretion: (a) retain such company
        in the Comparator Group; (b) exclude that company; (c) in the event of
        a takeover, replace that company with the acquiring company; (d) include
        a substitute for that; or (e) track the future performance of that company
    by reference to an	index.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|3.4 | The calculations
        of the Board shall not be open to question and in the absence of fraud
        the Board shall be under no liability to any person by reason thereof
        or of anything done or omitted by them for the purposes thereof or in
    connection therewith.                                                                                                                                                                                                                                                                                                                                          

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APPENDIX

Initial Comparator Group



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Schedule 2

Awards of Shares subject to forfeiture

|1.  | The Board may, if it thinks fit, grant Awards on terms that:                                                                                                                                                                                                                                 
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                              
|(a) | the Participant becomes beneficial owner of the Shares subject to the Award with effect from the Date of Grant; but                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                              
|(b) | those Shares are transferred to the Participant subject to an obligation on the Participant to transfer all or some of the Shares subject to the Award to the Trustee (or another person nominated by the Company) in circumstances where an Award granted under the rules would have lapsed.

2.     For
the purposes
of this Schedule an Award granted hereunder shall be a Forfeitable Share Award, and an Award granted under the main part of the rules shall be aStandard Award.

3.     In the event that the
Board grants a Forfeitable Share Award on the terms of this Schedule:

|(a) | the terms of the Forfeitable Share Award shall be set out in a Forfeitable Share Award Letter which is specifically tailored to the structure of that Award, including such provisions as are necessary to ensure that (subject to (d) below) that the Forfeitable Share Award is made on no more favourable terms than a Standard Award;                                                                                                                                                             
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(b) | such a grant may relate to a Deferred Award or a Performance Uplift Award, or both of them;                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(c) | the Forfeitable Share Award Letter shall describe the Participants tax treatment in relation to the Forfeitable Share Award, including a statement that any tax liability relating to the Forfeitable Share Award (including PAYE liabilities in respect of the receipt of the Award) shall be entirely the responsibility of the Participant, and that the Company shall in no circumstances whatsoever reimburse any such tax liability in the event that the Forfeitable Share Award is forfeited;
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(d) | the Forfeitable Share Award Letter shall confirm that, as beneficial owner of the Shares under the Forfeitable Share Award the Participant is entitled to dividend, voting and other rights commonly enjoyed by a shareholder; and                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|(e) | the Board may impose under the Forfeitable Share Award Letter such additional conditions as it thinks fit in relation to payment of tax liabilities, the obligation to transfer Shares under 1(b) above and otherwise.                                                                                                                                                                                                                                                                                

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