Chairman

  	
   

  
	
   

  	
   

  
	
   

  	
  Waterside (HBB3)

  
	
   

  	
  PO Box 365 Harmondsworth UB7 0GB

  
	
   

  	
  United Kingdom Tel 0870 850 9850

  
	
  Maarten van den Bergh Esq

  	
  Outside United Kingdom Tel +44 (0)191 490
  7901

  
	
  British Airways Plc

  	
   

  
	
  Waterside HBA3

  	
   

  
	
  Harmondsworth 

  	
   

  
	
  UB7 0GB

  	
   

  
	
   

  	
  11 March, 2004

  



Dear Maarten


NON-EXECUTIVE DIRECTOR APPOINTMENT


As part of our preparations to secure compliance with The Combined Code
on Corporate Governance (July
2003) (the “Combined Code”), I am writing to formally set out the terms on which serve on the Board of
British Airways Plc (‘the Company’) as
a Non-Executive Director. This letter sets out the terms of your appointment and it is agreed that this is a
contract for services and is not a contract of employment.


Appointment


Your appointment as a Non-Executive Director of the Company began on 16
July, 2002 when you were elected by shareholders for a three
year term which will end at the close
of the Annual General Meeting on 19 July, 2005, unless otherwise terminated earlier by and at the discretion of
either party upon one month’s written notice
(but subject always to the provisions of the Company’s Articles). Continuation of your contract of appointment is
contingent on satisfactory performance
and re-election at forthcoming Annual General Meetings. Non-Executive
Directors are typically expected to serve two three-year terms, although the Board may invite you to serve for an additional
period. It is unlikely that the contract
would be extended beyond a third term.


Board Committees


It is normal practice for all of the Company’s Non-Executive Directors
to also serve on Board
Committees. You have served on the Audit Committee since 1 January, 2003 and
the Nominations Committee since 16 July, 2002.


Time commitment


Overall we anticipate a time commitment of fifteen days per year from
our Non-Executive Directors after an initial induction phase.
This includes attendance at ten Board
meetings, the AGM, one annual Board away day, five Audit Committee meetings
and at least one site visit per year. Currently, three of the Board meetings


	
   

  	
   

  
	
  Directors: 

  	
  Lord Marshall of Knightsbridge (Chairman), M F Broughton (Deputy
  Chairman), R I Eddington (Chief Executive), J F Rishton (Chief Financial Officer), M A Street (Director of
  Customer Service & Operations), M A van den Bergh, Dr A S Ganguly, Capt M D Jeffery, Baroness O’Cathain OBE, Dr M P
  Read, A C Reed, Lord Renwick of Clifton

  



British Airways Plc

Registered Office: Waterside PO Box 365 Harmondsworth UB7 0GB

 Registered in England No. 1777777


www.ba.com











are held away
from the Company’s head office, one each at destinations on the domestic, short haul and long haul networks. The
Secretary will shortly forward to you
a schedule of meetings for 2005. In addition, you will be expected to devote appropriate preparation time ahead of each
meeting. By accepting this appointment, you have confirmed that you are able to allocate sufficient time to meet
the expectations of your role. The
agreement of the Chairman should be sought before accepting additional
commitments that might affect the time you are able to devote to your role as a
Non-Executive Director of the Company.


Role


Non-Executive Directors have the same general legal responsibilities to
the Company as any other
Director. The Board as a whole is collectively responsible for promoting the
success of the Company by directing and supervising the Company’s affairs. All
Directors must take decisions objectively in the interests of the Company. The Board:


	
   

  	
   

  	
   

  
	
   

  	
  •

  	
  provides
  entrepreneurial leadership of the Company within a framework of prudent and effective controls which enable
  risk to be assessed and managed;

  
	
   

  	
  •

  	
  sets the
  Company’s strategic aims, ensures that the necessary financial and human resources are in place for the
  Company to meet its objectives, and reviews management performance;
  and

  
	
   

  	
  •

  	
  sets the Company’s values and standards and ensures that its
  obligations to its shareholders and others are understood and met.

  



In addition to these
requirements of all Directors, the role of the non-executive has the following key elements:


	
   

  	
   

  	
   

  
	
   

  	
  •

  	
  Strategy: Non-Executive Directors should
  constructively challenge and contribute
  to the development of strategy;

  
	
   

  	
  •

  	
  Performance: Non-Executive Directors should scrutinise the performance
  of management in meeting agreed goals and objectives and monitor the
  reporting of performance;

  
	
   

  	
  •

  	
  Risk: Non-Executive Directors should satisfy
  themselves as to the integrity of
  financial information, that financial controls are sound and that the
  systems of risk management are robust and defensible; and

  
	
   

  	
  •

  	
  People: Non-Executive Directors, through the
  Remuneration Committee, are responsible for determining appropriate levels of
  remuneration of Executive Directors and have a prime role in
  appointing, and where necessary removing, senior management and in succession
  planning.

  



Fees


As a Non-Executive Director, you are paid a basic fee of £27,500 gross
per annum,* to include your membership of Board Committees, plus an additional
£600 for each major Board
Committee meeting separately attended. These amounts are paid quarterly in arrears, and will be subject to
review from time to time. The level of fees


*w.e.f. 1.Ï.04 £35,000 plus Senior
Independent  fee of £7,500 gross per annum.











for our Non-Executive Directors (other than the Chairman) is determined
by the Executive Directors on
the recommendation of the Chairman. The Company will reimburse you for all reasonable and properly
documented expenses you incur in performing
the duties of your office.


Outside interests


It is accepted
and acknowledged that you have business interests other than those of the Company and have declared any conflicts that
are apparent at present. In the event
that you become aware of any potential conflicts of interest, these should be disclosed
to the Chairman and Secretary as soon as apparent.


The Board of the Company has determined you to be independent (i)
according to provision A.3.1
of the Combined Code and (ii) for the purposes of the Corporate Governance Rules proposed by the New York Stock
Exchange (October 2003).


Confidentiality


All information acquired during your appointment is confidential to the
Company and should not be
released, either during your appointment or following termination (by whatever
means), to third parties without prior clearance from the Chairman.


Your attention is also drawn to the requirements under both legislation
and regulation as to the
disclosure of price sensitive information. Consequently you should avoid making any statements that might risk
a breach of these requirements without
prior clearance from the Chairman or the Secretary.


Regulation


As you know, as a result of your appointment, you became subject to the
Company’s policies on Insider Dealing, Business Conduct and Price
Sensitive Information as well as to the
provisions of the City Code on Takeovers, the Listing Rules and the regulations of the two stock exchanges.


Review process


The performance of individual Directors and the whole Board and its
Committees is evaluated
annually. If, in the interim, there are any matters which cause you concern about your role you should discuss them with the
Chairman as soon as is appropriate.


Insurance


The Company has Directors’ and officers’ liability insurance and it is
intended to maintain such cover
for the full term of your appointment. The current indemnity limit is £100 million in aggregate. The Secretary
will provide you with fuller details on
request.











Independent
professional advice


Occasions may arise when you consider that you need professional advice
in the furtherance of your
duties as a Director. Circumstances may occur when it will be appropriate for you to seek advice from independent
advisors at the Company’s expense.
This should be obtained in accordance with the Board’s agreed procedure details of which the Secretary will provide as part
of your induction. The Company will
reimburse the full cost of expenditure incurred in accordance with the policy.


Further information


The Secretary will write to you separately with the additional
information referred to in this letter and he will also cover the other formal
matters which have to be dealt with
in connection with your appointment.


I trust this letter sets out the agreed basis of your appointment and I
should be grateful if you
formally confirm your acceptance of the appointment and agreement to the terms as soon as convenient by signing and
returning the enclosed duplicate letter.


Yours
sincerely



[Signature Illegible]


I confirm my agreement to the foregoing.


	
   

  	
   

  
	
  Signed:
  [Signature Illegible]

  	
  Date:  11  March,  2004