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                                                                 EXHIBIT 3.17.1

                                 CELESTICA INC.










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                            LONG TERM INCENTIVE PLAN
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                                  June 28, 1998

                  As amended and restated on February 28, 2001




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                                 CELESTICA INC.

                            LONG TERM INCENTIVE PLAN
                            ------------------------

                                     PART I
                                     ------

1.                PURPOSE

1.1               This Long Term Incentive Plan has been established by the
Company to provide incentives to certain of its employees and consultants and
its directors, to foster a responsible balance between short term and long term
results, and to build and maintain a strong spirit of performance and
entrepreneurship.

2.                PLAN DEFINITIONS AND INTERPRETATIONS

2.1               In this Long Term Incentive Plan, the following terms have the
following meanings:

         (a)      "Applicable Law" means any applicable provision of law,
                  domestic or foreign, including, without limitation, the
                  SECURITIES ACT (Ontario), the U.S. SECURITIES ACT OF 1933, as
                  amended, and the U.S. SECURITIES EXCHANGE ACT 1934, as
                  amended, together with all regulations, rules, policy
                  statements, rulings, notices, orders or other instruments
                  promulgated thereunder and Stock Exchange Rules;

         (a.1)    "Associate" means an associate as defined by the SECURITIES
                  ACT (Ontario);

         (b)      "Beneficiary" means any person designated by the Participant
                  by written instrument filed with the Company to receive any
                  amount, securities or property payable under the Plan in the
                  event of a Participant's death or, failing any such effective
                  designation, the Participant's estate;

         (c)      "Board" means the Board of Directors of the Company;

         (d)      "Change in Control" means the occurrence of any of the
                  following after the date hereof:

                  (i)      the acquisition by any person of beneficial ownership
                           of securities of the Company which, directly or
                           following conversion or exercise thereof, would
                           entitle the holder thereof to cast more than 50% of
                           the votes attaching to all securities of the Company
                           which may be cast to elect directors of the Company,
                           other than the additional acquisition of securities
                           by a person beneficially owning such number of
                           securities on the date hereof; or



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                                      -2-

                  (ii)     Incumbent Directors ceasing to constitute a majority
                           of the Board as a consequence of the solicitation of
                           proxies through a proxy circular by persons other
                           than management;

         (e)      "Committee" means the committee of the Board, as constituted
                  from time to time, which may be appointed by the Board to,
                  INTER ALIA, interpret, administer and implement the Plan, and
                  includes any successor committee appointed by the Board for
                  such purposes;

         (f)      "Company" means Celestica Inc. and its respective successors
                  and assigns, and any reference in the Plan to action by the
                  Company means action by or under the authority of the Board or
                  any person or committee that has been designated for the
                  purpose by the Company including, without limitation, the
                  Committee;

         (g)      "Consultant" means a consultant as defined in the Rule
                  excluding investor consultants and associated consultants as
                  defined in the Rule;

         (h)      "Date of Grant" of an Option, a Right or a Performance Unit,
                  as the case may be, means the date the Option, Right or
                  Performance Unit is granted to a Participant under the Plan;

         (i)      "Designated Affiliated Entity" means a person (including a
                  trust or a partnership) or company in which the Company has a
                  significant investment and which the Company designates as
                  such for the purposes of this Plan;

         (j)      "Director means a member of the Board;

         (k)      "Earliest Exercise Date" in respect of an Option or Right as
                  the case may be, means the earliest date on which the Option
                  or Right may be exercised, as designated by the Company at the
                  time the Option or Right is granted;

         (l)      "Fiscal Year" means the financial year of the Company;

         (m)      "including" means including without limitation;

         (n)      "Incumbent Director" means any member of the Board who was a
                  member of the Board immediately prior to the occurrence of a
                  transaction, transactions or elections giving rise to a Change
                  in Control (other than a transaction approved by the Board)
                  and any successor to an Incumbent Director who is recommended
                  or elected or appointed to succeed an Incumbent Director by
                  the affirmative vote of a majority of the Incumbent Directors
                  then on the Board;

         (o)      "Independent Broker" means a registered broker which is
                  independent under Stock Exchange Rules;

         (o.1)    "Insider" means (a) an insider of the Company as defined by
                  the SECURITIES ACT (Ontario), other than a person who falls
                  within that definition solely by virtue of



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                                      -3-

                  being a director or senior officer of a Subsidiary; and (b) an
                  Associate of any person who is an Insider by virtue of (a);

         (p)      "Latest Exercise Date" means the latest date on which an
                  Option or Right as the case may be, may be exercised, as
                  designated by the Company at the time the Option or Right is
                  granted;

         (q)      "Market Price" shall mean the weighted average price per Share
                  (or the mean of the closing bid and ask prices, if not traded)
                  on the TSE during the period five trading days preceding the
                  date of the determination;

         (r)      "Option" means a right granted under the Plan to a Participant
                  to purchase Shares in accordance with the Plan; and

         (s)      "Option Program" means the Stock Option Program, consisting of
                  Part II of the Plan, as amended and restated from time to
                  time;

         (t)      "Participant" means

                  (i)      a Director,

                  (ii)     a permanent employee of the Company, a Subsidiary or
                           a Designated Affiliated Entity, or

                  (iii)    a Consultant of the Company, a Subsidiary, or a
                           Designated Affiliated Entity,

                  who has been designated by the Company for participation in
                  the Plan and who has agreed to participate in the Plan or any
                  Program thereof on such terms as the Company may specify;

         (u)      "Performance Share Program" means the Performance Share Unit
                  Program, consisting of Part IV of the Plan, as amended and
                  restated from time to time;

         (v)      "Performance Unit" means a unit allocated to a Participant in
                  accordance with the Performance Share Program;

         (w)      "Plan" means this Long Term Incentive Plan, consisting of the
                  Option Program, the Rights Program and the Performance Share
                  Program, as amended and restated from time to time;

         (x)      "Program" means the Option Program, the Rights Program or the
                  Performance Share Program, as applicable;

         (y)      "Reorganization" means any (i) capital reorganization, (ii)
                  merger, (iii) amalgamation, (iv) offer for shares of the
                  Company which if successful would entitle the offeror to
                  acquire all of the shares of the Company or all of one or more
                  particular class(es) of shares of the Company to which the
                  offer relates,



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                                      -4-

                  (v) sale of a material portion of the assets of the Company,
                  or (i) arrangement or other scheme of reorganization;

         (z)      "Right" means a stock appreciation right granted under the
                  Rights Program to a Participant in accordance with the Rights
                  Program;

         (aa)     "Retirement" means the retirement of a Participant from
                  employment with the Company, a Subsidiary or a Designated
                  Affiliated Entity in accordance with the normal retirement
                  policy of his or her employer;

         (bb)     "Rights Program" means the Stock Appreciation Rights Program,
                  consisting of Part III of the Plan, as amended and restated
                  from time to time;

         (cc)     "Rule" means the Ontario Securities Rule 45-503 Trades to
                  Employees, Executives and Consultants;

         (dd)     "Shares" means the Subordinate Voting Shares in the capital of
                  the Company, and includes any shares of the Company into which
                  such shares may be converted, reclassified, redesignated,
                  subdivided, consolidated, exchanged or otherwise changed,
                  pursuant to a Reorganization or otherwise;

         (ee)     "Stock Exchange Rules" means the applicable rules of any stock
                  exchange upon which shares of the Company are listed;

         (ff)     "Subsidiary" means a subsidiary of the Company as defined by
                  the BUSINESS CORPORATIONS ACT (Ontario);

         (gg)     "TSE" means The Toronto Stock Exchange; and

         (hh)     "Year" in respect of an Option, Right or Performance Unit, as
                  the case may be, means a calendar year commencing on the Date
                  of Grant of the Option, Right or Performance Unit, as the case
                  may be, or on any anniversary of such date.

2.2               Certain other defined terms used herein have the meanings
ascribed to them in the Option Program, the Rights Program or the Performance
Share Program.

2.3               In this Plan, unless the context requires otherwise, words
importing the singular number may be construed to extend to and include the
plural number, and words importing the plural number may be construed to extend
to and include the singular number.

2.4               The Option Price per Share or Market Price may be expressed or
designated in a currency other than Canadian dollars, based on the noon day
foreign exchange rate as quoted by the Bank of Canada on the relevant date or
such other foreign exchange rate basis as the Company may determine to be
appropriate.

2.5               This Plan is established under the laws of the Province of
Ontario and the rights of all parties and the construction of each and every
provision of the Plan and any Options,



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                                      -5-

Rights or Performance Units granted hereunder shall be construed according to
the laws of the Province of Ontario.

2.6               This Plan consists of four parts, the first part ("Part I")
commencing with Section 1, consisting of general provisions applicable to the
Plan as a whole; the second part ("Part II") commencing with section 5,
consisting of the Option Program; the third part ("Part III") commencing with
section 12, consisting of the Rights Program and the fourth part ("Part IV")
commencing with section 18, consisting of the Performance Share Program.

3.                GENERAL

3.1               The transfer of an employee from the Company to a Subsidiary
or a Designated Affiliated Entity, from a Subsidiary or a Designated Affiliated
Entity to the Company, or from one Subsidiary or Designated Affiliated Entity to
another Subsidiary or Designated Affiliated Entity, shall not be considered a
termination of employment for the purposes of the Plan, nor shall it be
considered a termination of employment if a Participant is placed on such other
leave of absence which is considered by the Company as continuing intact the
employment relationship; in such a case, the employment relationship shall be
continued until the later of the date when the leave equals ninety days or the
date when a Participant's right to reemployment shall no longer be guaranteed
either by law or by contract, except that in the event active employment is not
renewed at the end of the leave of absence, the employment relationship shall be
deemed to have ceased at the beginning of the leave of absence.

3.2               The number of Shares which may be issued from the treasury of
the Company under this Plan is limited to 23,000,000. The number of Shares which
may be reserved for issue under Options, or Rights granted pursuant to this
Plan, together with Shares reserved for issue under any other employee-related
plan of the Company or options for services granted by the Company, to any one
person shall not exceed 5% of the outstanding voting securities of the Company.
The Company may from time to time designate in each case such other maximum
number for this purpose which, however, will not in any event exceed the maximum
number permitted from time to time under Stock Exchange Rules. The number of
Shares which may be issued from the treasury of the Company under this Plan to
Directors is limited to 1,000,000. The number of Shares reserved for issue under
Options or Rights granted to Insiders pursuant to this Plan, together with
Shares reserved for issue to Insiders under any other existing share
compensation arrangement of the Company, shall not exceed 10% of the aggregate
outstanding Multiple Voting Shares and Subordinate Voting Shares of the Company.
Within any one-year period, the number of Shares issued to Insiders pursuant to
this Plan and all other existing share compensation arrangements of the Company
shall not exceed 10% of the aggregate outstanding Multiple Voting Shares and
Subordinate Voting Shares of the Company and the number of Shares issued to any
one Insider and such Insider's Associates shall not exceed 5% of the aggregate
outstanding Multiple Voting Shares and Subordinate Voting Shares of the Company.
If the number of Shares of the Company shall be increased or decreased as a
result of a stock split, consolidation, reclassification or recapitalization and
not as a result of the issuance of Shares for additional consideration or by way
of a stock dividend in the ordinary course, the Company may make appropriate
adjustments to the maximum number of Shares which may be issued from the
treasury of the Company under the Plan.



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                                      -6-

3.3               Subject to any Applicable Law, the Company may, but is not
obligated to, acquire issued and outstanding Shares in the market for the
purposes of providing Shares to Participants under the Plan. If it does so, the
Company shall utilize the services of an Independent Broker. The Shares acquired
for this purpose shall not be included for the purposes of the determining the
maximum number of Shares to be issued under the Plan in accordance with section
3.2.

3.4               From time to time the Company may, in addition to its powers
under the Plan, add to or amend any of the provisions of the Plan or terminate
the Plan or amend the terms of any Option, Right or Performance Unit granted
under the Plan; provided, however, that (i) any approvals required under any
applicable law or Stock Exchange Rules are obtained, and (ii) no such amendment
or termination shall be made at any time which has the effect of adversely
affecting the existing rights of a Participant under the Plan without his or her
consent in writing unless the Company, at its option, acquires such existing
rights at an amount equal to the fair market value of such rights at such time
as verified by an independent valuator.

3.5               The determination by the Company of any question which may
arise as to the interpretation or implementation of the Plan or any of the
Options, Rights or Performance Units granted hereunder shall be final and
binding on all Participants and other persons claiming or deriving rights
through any of them.

3.6               The Plan shall enure to the benefit of and be binding upon the
Company, its successors and assigns. The interest of any Participant under the
Plan or in any Option, Right or Performance Unit shall not be transferable or
alienable by him or her either by pledge, assignment or in any other manner,
except to a spouse or a personal holding company or family trust controlled by a
Participant, the shareholders or beneficiaries of which, as the case may be, are
any combination of the Participant, the Participant's spouse, the Participant's
minor children or the Participant's minor grandchildren, and after his or her
lifetime shall enure to the benefit of and be binding upon the Participant's
Beneficiary.

3.7               The Company's obligation to issue or provide Shares in
accordance with the terms of the Plan and any Options, Rights or Performance
Units granted hereunder is subject to compliance with Applicable Law applicable
to the issuance and distribution of such Shares. As a condition of participating
in the Plan, each Participant agrees to comply with all such Law and agrees to
furnish to the Company all information and undertakings as may be required to
permit compliance with such Law.

3.8               The Company, a Subsidiary or a Designated Affiliated Entity
may withhold from any amount payable to a Participant, either under this Plan,
or otherwise, such amount as may be necessary so as to ensure that the Company,
the Subsidiary or Designated Affiliated Entity will be able to comply with the
applicable provisions of any federal, provincial, state or local law relating to
the withholding of tax or other required deductions, including on the amount, if
any, includable in the income of a Participant. The Company shall also have the
right in its discretion to satisfy any such withholding tax liability by
retaining or acquiring any Shares which would otherwise be issued or provided to
a Participant hereunder.

3.9               A Participant shall not have the right or be entitled to
exercise any voting rights, receive dividends or have or be entitled to any
other rights as a shareholder in respect of (i)



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                                      -7-

Shares subject to an Option unless and until such Shares have been paid for in
full and issued, (ii) any Rights, or (iii) any Performance Units unless and
until issued or provided in the form of Performance Shares.

3.10              Neither designation of an employee as a Participant nor the
grant of any Options, Rights or Performance Units to any Participant entitles
any Participant to the grant, or any additional grant, as the case may be, of
any Options, Rights or Performance Units under the Plan. Neither the Plan nor
any action taken thereunder shall interfere with the right of the employer of a
Participant to terminate a Participant's employment at any time. Neither any
period of notice, if any, nor any payment in lieu thereof, upon termination of
employment shall be considered as extending the period of employment for the
purposes of the Plan.

3.11              No member of the Board or the Committee shall be liable for
any action or determination made in good faith in connection with the Plan and
members of the Board and the Committee shall be entitled to indemnification and
reimbursement from the Company in respect of any claim relating thereto.

3.12              Participation in the Plan shall be entirely voluntary and any
decision not to participate shall not affect any employee's employment with, or
any Consultant's engagement by, the Company, a Subsidiary or Designated
Affiliated Entity.

3.13              If any provision of this Plan is determined to be invalid or
unenforceable in whole or in part, such invalidity or unenforceability shall
attach only to such provision or part thereof and the remaining part, if any, of
such provision and all other provisions hereof shall continue in full force and
effect.

3.14              Neither the establishment of the Plan nor the grant of any
Rights or Performance Units or the setting aside of any funds by the Company
(if, in its sole discretion, it chooses to do so) shall be deemed to create a
trust. Legal and equitable title to any funds set aside for the purposes of the
Plan shall remain in the Company and no Participant shall have any security or
other interest in such funds. Any funds so set aside shall remain subject to the
claims of creditors of the Company present or future. Amounts payable to any
Participant under the Plan shall be a general, unsecured obligation of the
Company. The right of the Participant or Beneficiary to receive payment pursuant
to the Plan shall be no greater than the right of other unsecured creditors of
the Company.

3.15              This Plan is hereby instituted this 28th day of June, 1998.

4.                ADMINISTRATION

4.1               The Plan shall be administered by the Company in accordance
with its provisions. All costs and expenses of administering the Plan will be
paid by the Company, but the Company shall not be responsible for the payment of
any fees or expenses in respect of the re-sale by a Participant of Shares
acquired by him or her under the Plan. The Company, may from time to time,
establish administrative rules and regulations and prescribe forms or documents
relating to the operation of the Plan as it may deem necessary to implement or
further the purpose of the Plan and amend or repeal such rules and regulations
or forms or documents. The Company, in its discretion, may appoint a Committee
for the purpose of interpreting, administering and



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                                      -8-

implementing the Plan or a Program. In administering the Plan, the Company or
the Committee may seek recommendations from the chief executive officer of the
Company. The Company may also delegate to the Committee or any director, officer
or employee of the Company such duties and powers, relating to the Plan or a
Program as it may see fit. The Company may also appoint or engage a trustee,
custodian or administrator to administer or implement the Plan or a Program.

4.2               The Company shall keep or cause to be kept such records and
accounts as may be necessary or appropriate in connection with the
administration of the Plan and the discharge of its duties. At such times as the
Company shall determine, the Company shall furnish the Participant with a
statement setting forth the details of his or her Options, Rights or Performance
Units, including Date of Grant, Designated Option Amount and the Option Price of
each Option, the number of Shares in respect of which the Option has been
exercised, the maximum number of Shares which the Participant may still purchase
under the Option Program, the Designated Rights Amount held by each Participant
and the number of Performance Units held by each Participant. Such statement
shall be deemed to have been accepted by the Participant as correct unless
written notice to the contrary is given to the Company within 30 days after such
statement is given to the Participant.

4.3     (a) Any payment, notice, statement, certificate or other instrument
            required or permitted to be given to a Participant or any person
            claiming or deriving any rights through him or her shall be given
            by:

                (i)     delivering it personally to the Participant or to the
                        person claiming or deriving rights through him or her,
                        as the case may be, or

                (ii)    mailing it postage paid (provided that the postal
                        service is then in operation) or delivering it to the
                        address which is maintained for the Participant in the
                        Company's personnel records.

        (b)     Any payment, notice, statement, certificate or other instrument
                required or permitted to be given to the Company shall be given
                by mailing it postage paid (provided that the postal service is
                then in operation), delivering it to the Company at its
                principal address, or (other than in the case of a payment)
                sending it by means of facsimile or similar means of electronic
                transmission, to the attention of the Company Secretary.

        (c)     Any payment, notice, statement, certificate or other instrument
                referred to in section 4.3(a) or 4.3(b), if delivered, shall be
                deemed to have been given or delivered on the date on which it
                was delivered, if mailed (provided that the postal service is
                then in operation), shall be deemed to have been given or
                delivered on the second business day following the date on which
                it was mailed and if by facsimile or similar means of electronic
                transmission, on the next business day following transmission.




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                                      -9-


                                     PART II
                                     -------

                              STOCK OPTION PROGRAM
                              --------------------

5.              STOCK OPTION PROGRAM DEFINITIONS

5.1             In this Program, the following terms have the following
meanings:

        (a)     "Designated Amount" of a Participant's Option means the maximum
                number of Shares which the Participant may purchase under the
                Option, as designated by the Company;

        (b)     "Designated Percentage" in respect of an Option means the
                percentage of the Designated Amount representing the maximum
                number of Shares which a Participant may purchase under the
                Option during each Option Year which, unless otherwise
                determined by the Company, shall be 20% commencing on the second
                Option Year, 40% commencing on the third Option Year, 60%
                commencing on the fourth Option Year, 80% commencing on the
                fifth Option Year and 100% commencing on the sixth Option Year;

        (c)     "Option Price" in respect of an Option means the price
                designated by the Company at which the Participant may purchase
                a Share under the Option; and

        (d)     "Program" means this Stock Option Program.

6.              GRANTING OF OPTIONS AND
                DETERMINATION OF THE OPTION PRICE
                ---------------------------------

6.1             From time to time the Company may grant Options to Participants
to acquire Shares in accordance with the Plan. In granting each such Option, the
Company shall designate:

        (a)     the Designated Amount of Shares;

        (b)     the Earliest Exercise Date, which may be the Date of Grant;

        (c)     the Latest Exercise Date, which shall be no later than ten years
                after the Date of Grant;

        (d)     the Designated Percentage; and

        (e)     the Option Price, which price shall be determined by the Company
                in accordance with section 6.2.

6.2             The Option Price per Share in respect of an Option shall be not
less than the price per Share of the last reporting selling price of at least a
Board Lot of the Shares on the TSE on the day preceding the Date of Grant of the
Option and, if there were no such trades on that day, the weighted average
trading price of the Shares for the previous five days on which the Shares
traded on the TSE.



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                                      -10-

6.3             Subject to the terms of the Plan, the Company may determine
other terms or conditions, if any, of any Options, including:

        (a)     any additional conditions on the grant of Options under the
                Program, including conditions as to the ownership of Shares by a
                Participant;

        (b)     any additional conditions with respect to the exercise of
                Options under the Program, including conditions in respect of

                (i)     the market price of the Shares,

                (ii)    the financial performance or results of the Company, a
                        Subsidiary, a Designated Affiliated Entity or business
                        unit, and

                (iii)   restrictions on the re-sale of Shares acquired on the
                        exercise of Options; and

        (c)     such other terms or conditions as the Company may in its
                discretion determine.

6.4             At the discretion of the Company, an Option granted under the
Plan may have connected therewith any number of rights or fractions of rights.
Each such right in respect of a Share shall entitle the Participant to surrender
to the Company, unexercised, the right to subscribe for such Share pursuant to
the related Option and to receive from the Company cash in an amount equal to
the excess of the market price ("market price" for this purpose shall mean the
weighted average price per Share (or the mean of the closing bid and ask prices,
if not traded) on the TSE during the period five trading days preceding the date
of the determination) over the Exercise Price provided in the related Option.
Each exercise of a right in respect of a Share covered by a related Option shall
terminate that Option in respect of such Share and such Option in respect of
such Share shall be of no further force or effect. Unexercised rights shall
terminate when the related Option is exercised or the Option terminates.

7.              EXERCISE OF PARTICIPANT'S OPTIONS

7.1             Subject to the provisions of the Plan, an Option may be
exercised by the Participant only on or after the Earliest Exercise Date and
thereafter from time to time at his or her discretion to purchase in the
aggregate a number of Shares equal to the aggregate of the previously
unexercised portion of the Designated Amount provided that, unless the Company
at any time otherwise determines,

        (a)     subject to clause (b) of this section 7.1, the maximum number of
                Shares which the Participant may purchase under the Option
                during each of the Years commencing on the Earliest Exercise
                Date of the Option shall be equal to the number of Shares
                represented by the Designated Percentage of the Designated
                Amount of the Option, and

        (b)     if the number of Shares purchased under the Option during any of
                the Years is less than the maximum number which could have been
                purchased under the Option during that Year, the difference
                shall be carried forward and added to the



<PAGE>

                                      -11-

                maximum number of Shares which may be purchased under the Option
                in the immediately following Year, and so on from time to time,
                provided that the percentage of the Designated Amount which the
                Participant may purchase under an Option shall not exceed one
                hundred per cent (100%).

7.2             Notwithstanding section 7.1, Options may be exercised at any
time following a Change in Control.

7.3             Unless the Company at any time otherwise determines, a
Participant's Option shall terminate and may not be exercised after the earliest
of:

        (a)     in the case of the termination of employment with the Company
                for cause, immediately as of the time of such termination;

        (b)     30 days after the date of the Participant's termination of
                employment with the Company, unless such termination occurs by
                reason of termination of the Participant's employment for cause
                or the Participant's death, disability or Retirement as
                contemplated in subsections (a), (c) or (d) of this section, in
                which case the provisions of the applicable subsection shall
                govern;

        (c)     three years after the Participant's Retirement provided that if
                the Participant dies prior to the expiry of the first two years
                of such three-year period the Option shall terminate one year
                after the Participant's death;

        (d)     one year after the Participant's death or the termination of
                employment with the Company by reason of his disability (as
                determined by the Company in its sole discretion); and

        (e)     the Latest Exercise Date of the Participant's Option;

provided that, in any event, the Option shall terminate no later than ten years
after the Date of Grant.

7.4            The exercise of an Option under the Plan shall be made by notice
to the Company in writing specifying and subscribing for the number of Shares in
respect of which the Option is being exercised at that time and, except where
payment is made by another means satisfactory to the Company such as wire
transfer of funds, accompanied by a certified cheque or bank draft payable to
the Company in the amount of the aggregate Option Price for such number of
Shares. Upon receipt of such notice and payment, the Shares in respect of which
the Option has been exercised shall be issued as fully-paid and non-assessable
shares of the Company. As of the business day the Company receives such notice
and such payment, the Participant (or the person claiming through him, as the
case may be) shall be entitled to be entered on the share register of the
Company as the holder of the number of Shares in respect of which the Option was
exercised and to receive as promptly as possible thereafter a certificate
representing the said number of Shares.

7.5             A Participant may, in lieu of an exercise of an Option under
section 7.4, exercise an Option for a number of Shares without payment of the
Option Price by notice to the Company



<PAGE>

                                      -12-

in writing specifying the Participant is subscribing for that number of Shares
to which the Participant is entitled under this Program without payment of the
Option Price. The number of Shares to be issued or provided to the Participant
is the number obtained by dividing (a) the difference between the Market Price
and the Option Price multiplied by the number of the Shares in respect of which
the Option would otherwise be exercised under section 7.4 with the payment of
the aggregate Option Price by (b) the Market Price. The Shares issued in respect
thereof shall be considered fully paid in consideration of past service that is
no less in value than the fair equivalent of the money the Company would have
received if the Shares had been issued for money.

7.6             Unless otherwise determined by the Company, if the Participant
is a person who has knowledge of a "material fact" or "material change" (each as
defined under the SECURITIES ACT (Ontario)) in respect of the Company that has
not been generally disclosed in accordance with applicable securities
legislation and adequately disseminated to the public, he or she shall not be
entitled to exercise the Option.

8.              EFFECT OF TERMINATION OF OPTION

8.1             If any Option has terminated or expired without being fully
exercised, any unissued Shares which have been reserved to be issued upon the
exercise of the Option shall become available to be issued upon the exercise of
Options subsequently granted under the Program.

9.              CHANGES IN SHARE CAPITAL

9.1             If the number of outstanding Shares of the Company shall be
increased or decreased as a result of a stock split, consolidation,
reclassification or recapitalization and not as a result of the issuance of
Shares for additional consideration or by way of a stock dividend in the
ordinary course, the Company may make appropriate adjustments to the Designated
Option Amount of any Option which has previously been granted under the Program,
the maximum number of Shares which the Participant may thereafter purchase under
such Option, the Option Price in respect of such Option and any maximum number
of Shares which may be issued under the Program. Any determinations by the
Company as to the adjustments shall be made in its sole discretion and all such
adjustments shall be conclusive and binding for all purposes under the Program.

9.2             No fractional shares shall be issued upon the exercise of an
Option nor shall any scrip certificates in lieu thereof be issuable at any time.
Accordingly, if as a result of any adjustment under section 9.1 a Participant
would otherwise have become entitled to a fractional share upon the exercise of
an Option, he shall have the right to purchase only the next lower whole number
of Shares and no payment or other adjustment will be made with respect to the
fractional interests so disregarded.

10.             LOANS TO PARTICIPANTS

10.1            Subject to Applicable Law, the Company may in its sole
discretion arrange for the Company, any Subsidiary or any Designated Affiliated
Entity to make loans or provide guarantees for loans by financial institutions
to assist Participants to purchase Shares upon the



<PAGE>

                                      -13-

exercise of the Options and to assist the Participants to pay any income tax
exigible upon exercise of the Options. Such loans may be secured or unsecured,
and at such rates of interest, if any, and on such other terms as may be
determined by the Company, provided that in no event shall any loan be
outstanding for more than 10 years from the Date of Grant of the relevant
Option.

11.             REORGANIZATION

11.1            In the event of a Reorganization or proposed Reorganization, the
Company, at its option, may, subject to Stock Exchange Rules, do either of the
following:

        (a)     the Company may irrevocably commute any Option that is still
                capable of being exercised, upon giving to any Participant to
                whom such Option has been granted at least 30 days written
                notice of its intention to commute the Option, and during such
                period of notice, the Option, to the extent that it has not been
                exercised, may be exercised by the Participant up to the
                Designated Amount of Shares which may be purchased under the
                Option, without regard to the limitations contained in
                subsection 7.1(a), and on the expiry of such period of notice,
                the unexercised portion of the Option shall lapse and be
                cancelled, or

        (b)     the Company, or any corporation which is or would be the
                successor to the Company or which may issue securities in
                exchange for Shares upon the Reorganization becoming effective,
                may offer any Participant the opportunity to obtain a new or
                replacement option over any securities into which the Shares are
                changed or are convertible or exchangeable, on a basis
                proportionate to the number of Shares under option or some other
                appropriate basis, or some other property; in such event, the
                Participant shall, if he or she accepts such offer, be deemed to
                have released his or her Option over Shares and such Option
                shall be deemed to have terminated.

11.2            The Company may specify in any notice or offer made under
section 11.1, that, if for any reason, the Reorganization is not completed, the
Company may revoke such notice or offer. The Company may exercise such right by
further notice in writing to the Participant and return to the Participant any
amount paid as an Option Price by the Participant to the Company and the Option
shall thereafter continue to be exercisable by the Participant in accordance
with its terms.

11.3            Subsections (a) and (b) of section 11.1 are intended to be
permissive and may be utilized independently or successively or in combination
or otherwise, and nothing therein contained shall be construed as limiting or
affecting the ability of the Company to deal with Options in any other manner.



<PAGE>

                                      -14-


                                    PART III
                                    --------

                        STOCK APPRECIATION RIGHTS PROGRAM
                        ---------------------------------

12.               PROGRAM DEFINITIONS

12.1              In this Program, the following terms have the following
meanings:

         (a)      "Designated Rights Amount" of a Participant's Rights means the
                  maximum number of Rights which the Participant may exercise,
                  as designated by the Company;

         (b)      "Designated Rights Percentage" means the percentage of the
                  Designated Rights Amount representing the maximum number of
                  Rights which a Participant may exercise each Year, which,
                  unless otherwise determined by the Company, shall be 20%
                  commencing on the second Year, 40% commencing on the third
                  Year, 60% commencing on the fourth Year, 80% commencing on the
                  fifth Year and 100% commencing on the sixth Year;

         (c)      "In the Money" means the excess, if any, of the Market Price
                  of a Share at any time over the Strike Price;

         (d)      "Program" means this Stock Appreciation Rights Program;

         (e)      "Rights Letter" means a letter approved by the Company whereby
                  a Participant may exercise his Rights; and

         (f)      "Strike Price" means the Market Price on the Date of Grant.

13.               GRANTING OF RIGHTS

13.1              From time to time the Company may grant Rights to a
Participant in accordance with the Plan. In granting any such Rights, the
Company shall designate:

         (a)      the Designated Rights Amount;

         (b)      the Earliest Exercise Date;

         (c)      the Latest Exercise Date;

         (d)      the Designated Rights Percentage; and

         (e)      the Strike Price of the Shares on the Date of Grant.

13.2              Subject to the term of the Plan, the Company may determine
other terms or conditions, if any, of any Rights, including:



<PAGE>

                                      -15-

         (a)      any additional conditions on the grant of Rights under the
                  Program, including conditions as to the ownership of Shares by
                  a Participant;

         (b)      any additional conditions with respect to the exercise of
                  Rights under the Program, including conditions in respect of
                  (i) the market price of the Shares and (ii) the financial
                  performance or results of the Company, a Subsidiary, a
                  Designated Affiliated Entity, or business unit; and

         (c)      such other terms or conditions of the Company may in its
                  discretion determine.

14.               EXERCISE OF PARTICIPANT'S RIGHTS

14.1              Subject to the provisions of the Program, a Right may be
exercised by the Participant only on or after the Earliest Exercise Date and
thereafter from time to time at his or her discretion, provided that, unless the
Company at any time otherwise determines,

         (a)      subject to clause (b) of this section 14.1, the maximum number
                  of Rights which the Participant may exercise during each of
                  the Years commencing on the Earliest Exercise Date of the
                  Right shall be equal to the number of Rights represented by
                  the Designated Rights Percentage of the Designated Rights
                  Amount, and

         (b)      if the number of Rights exercised during any of the Years is
                  less than the maximum number which could have been exercised
                  during that Year, the difference shall be carried forward and
                  added to the maximum number of Rights which may be exercised
                  immediately following the Year, and so on from time to time.

14.2              Notwithstanding section 14.1, Rights may be exercised at any
time following a Change in Control.

14.3              Upon exercising a Right, the Participant will be paid the
amount by which such Right is In The Money on the date of exercise of the Right,
subject to any applicable withholding of taxes.

14.4              Unless the Company at any time otherwise determines, a
Participant's Right shall terminate and may not be exercised after the earliest
of:

         (a)      in the case of termination of employment with the Company for
                  cause, immediately as of the time of such termination;

         (b)      30 days after the date of the Participant's termination of
                  employment with the Company, unless such termination occurs by
                  reason of termination of the Participant's employment for
                  cause or the Participant's death, disability or Retirement as
                  contemplated in subsections (a), (c) or (d) of this section,
                  in which case the provisions of the applicable subsection
                  shall govern;



<PAGE>

                                      -16-

         (c)      three years after the Participant's Retirement provided that
                  if the Participant dies prior to the expiry of the first two
                  years of such three-year period, the Right shall terminate one
                  year after the Participant's death;

         (d)      one year after the Participant's death or the termination of
                  employment with the Company by reason of his disability (as
                  determined by the Company in its sole discretion); and

         (e)      the Latest Exercise Date of the Participant's Right.

14.5              No certificates shall be issued with respect to such Rights,
but the Company shall maintain records in the name of each Participant showing
the number of Rights to which such Participant is entitled in accordance with
the Rights Program.

14.6              In order to exercise his Rights, the Participant must forward
a completed Rights Letter by personal delivery, or registered mail or facsimile
to the Company in the manner provided for in section 4.3.

14.7              The Company may, in lieu of all or a portion of the amount
which would otherwise be payable to a Participant under this Program, issue or
provide to a Participant a number of Shares. The number of Shares to be issued
or provided to a Participant will be determined by dividing the cash amount that
is proposed to be provided in the form of Shares under this section by the
applicable Market Price.

15.               EXERCISE OF RIGHTS

15.1              Unless otherwise determined by the Company, if the Participant
is a person who has knowledge of a "material fact" or "material change" (each as
defined under the SECURITIES ACT (Ontario)) in respect of the Company that has
not been generally disclosed in accordance with applicable securities
legislation and adequately disseminated to the public, he or she shall not be
entitled to exercise the Right.

16.               CHANGES IN SHARE CAPITAL

16.1              If the number of outstanding Shares of the Company shall be
increased or decreased as a result of a stock split, consolidation,
reclassification or recapitalization and not as a result of the issuance of
Shares for additional consideration or by way of a stock dividend in the
ordinary course, the Company may make appropriate adjustments to the Designated
Rights Amount and/or the Strike Price. Any determinations by the Company as to
the adjustments shall be made in its sole discretion and all such adjustments
shall be conclusive and binding for all purposes under the Program.

17.               REORGANIZATION

17.1              In the event of a Reorganization or proposed Reorganization,
the Company, at its option, may, subject to Stock Exchange Rules, do either of
the following:



<PAGE>

                                      -17-

         (a)      the Company may irrevocably commute any Right that is still
                  capable of being exercised, upon giving to any Participant to
                  whom such Right has been granted at least 30 days written
                  notice of its intention to commute the Right, and during such
                  period of notice, the Right, to the extent that it has not
                  been exercised, may be exercised by the Participant up to the
                  Designated Rights Amount without regard to the limitations
                  contained in subsection 14.1(a), and on the expiry of such
                  period of notice, the unexercised portion of the Rights shall
                  lapse or be cancelled; or

         (b)      the Company, or any corporation which is or would be the
                  successor to the Company or which may issue securities in
                  exchange for Shares upon the Reorganization becoming
                  effective, may offer any Participant the opportunity to obtain
                  a new or replacement stock appreciation right or a security in
                  respect of any securities into which the Shares are changed or
                  are convertible or exchangeable, on a basis proportionate to
                  the number of Rights held by the Participant or some other
                  appropriate basis, or some other property; in such event, the
                  Participant shall, if he or she accepts such offer, be deemed
                  to have released his or her Rights and such Rights shall be
                  deemed to have terminated.

17.2              The Company may specify in any notice or offer made under
section 17.1, that, if for any reason, the Reorganization is not completed, the
Company may revoke such notice or offer. The Company may exercise such right by
further notice in writing to the Participant and the Right shall thereafter
continue to be exercisable by the Participant in accordance with its terms.

17.3              Subsections (a) and (b) of section 17.1 are intended to be
permissive and may be utilized independently or successively or in combination
or otherwise, and nothing therein contained shall be construed as limiting or
affecting the ability of the Company to deal with Rights in any other manner.



<PAGE>

                                      -18-


                                    PART IV
                                    -------

                         PERFORMANCE SHARE UNIT PROGRAM
                         ------------------------------


18.               PERFORMANCE SHARE UNIT PROGRAM DEFINITIONS

18.1              In this Program, the following terms have the following
meanings:

         (a)      "Performance Grant" means a grant to a Participant pursuant to
                  Article 19 of a bonus stated as a dollar amount;

         (b)      "Performance Unit" means a unit allocated to a Participant
                  under the Program in accordance with Article 19;

         (c)      "Program" means this Performance Share Program; and

         (d)      "Release Date" means, for a Performance Grant, the date or
                  dates on which Performance Units shall be issued or be
                  provided in the form of Performance Shares.

19.               GRANT OF PERFORMANCE GRANTS
                  AND ALLOCATION OF PERFORMANCE UNITS
                  -----------------------------------

19.1              Subsequent to the completion of each Fiscal Year, the Company
may, in its sole discretion, determine whether Performance Grants will be made
to a particular Participant, the dollar amount of such Performance Grant and the
Release Dates for the relevant Shares for such Participant. In making such
determinations, the Company may take into account the Participant's level of
responsibility, rate of compensation, individual performance and contribution,
and such other criteria as it deems appropriate, in assessing the value of such
past service of the Participant in respect of such Fiscal Year.

19.2              At the option of either the Company or the Participant, the
amount payable to a Participant under any bonus, profit sharing or gain-sharing
program by the Company, a Subsidiary or a Designated Affiliated Entity in
respect of a Fiscal Year, or a portion thereof, may be provided in the form of
Performance Grants in lieu thereof, provided the Company or Participant so
elects prior to the completion of the relevant Fiscal Year. In this case, the
amount of the Performance Grant shall be the amount in respect of which the
election has been made and the Release Date shall be the date or a specified
event (including termination of employment on Retirement) determined by the
Company.

19.3              On the Date of Grant, each Participant who receives a
Performance Grant shall be allocated Performance Units reflecting such
Performance Grant.

19.4              The number of Performance Units to be allocated to each
Participant shall be obtained by dividing the amount of the Performance Grant of
each such Participant by the Market Price on the Date of Grant. Fractional Units
may be allocated. Each such Performance


<PAGE>

                                      -19-

Unit shall represent the right to receive one Share or a cash payment at the
time, in the manner and subject to the restrictions set forth in this Program.

19.5              No certificates shall be issued with respect to such
Performance Grants or Performance Units, but the Company shall maintain records
in the name of each Participant showing the number of Performance Units to which
such Participant is entitled in accordance with the Performance Share Program.

20.               PERFORMANCE UNITS

20.1              Subject to section 20.2 and Article 21, and unless at any time
otherwise determined by the Company at any time, the Performance Units shall be
issued or provided in the form of Shares on the Release Date as determined under
Article 19.

20.2              Subject to the terms of the Plan, the Company may determine
other terms or conditions of any Performance Units, including

         (a)      any additional conditions with respect to the issue or
                  provision of Shares under the Program, including conditions in
                  respect of

                  (i)      the market price of the Shares,

                  (ii)     the financial performance or results of the Company,
                           a Subsidiary, a Designated Affiliated Entity or
                           business unit and

                  (iii)    restrictions on the re-sale of Shares acquired under
                           the Program; and

         (b)      any other terms and conditions the Company may in its
                  discretion determine.

21.               TERMINATION OF EMPLOYMENT AND FORFEITURES

21.1              Unless otherwise determined by the Company at any time, if a
Participant ceases to be employed by the Company, a Subsidiary or Designated
Affiliated Entity for any reason other than death, long-term disability or
Retirement, there shall be forfeited as of such termination of employment such
Performance Units as have not been issued or provided in the form of Shares in
accordance with the Plan. No cash or other compensation shall at any time be
paid in lieu of any such Performance Units which have been forfeited under this
Plan.

21.2              If (i) a Participant dies or ceases to be an employee of the
Company, a Subsidiary or a Designated Affiliated Entity by reason of long-term
disability or Retirement or (ii) for any other reason specified in each case by
the Company, all Performance Units shall be issued or provided in the form of
Shares to such Participant or his or her Beneficiary on a date determined by the
Company which shall in any event be not later than one year following the event.

21.3              If there is a Change of Control, all Performance Units shall
be issued or provided in the form of Shares to all Participants.



<PAGE>

                                      -20-

22.               ISSUE OF SHARES

22.1              The number of Shares to be issued or provided shall be equal
to the whole number of Performance Units which are to be released. Where, under
section 20.1, the number of Units allocated would result in the issue of a
fractional Unit in the form of a fractional Share, the number of Units to be
issued in the form of Shares shall be rounded down to the next whole number of
Performance Units. No fractional Shares shall be issued or provided nor shall
cash be paid at any time in lieu of any such fractional interest. Any such
fractional interests of a Unit which, together with other fractional interests,
form a whole Unit, shall be issued or provided in the form of a Share as part of
the Units to be issued or provided to the Participant on the next applicable
Release Date, if any.

22.2              Shares issued by the Company from treasury under the
Performance Share Program shall be considered fully paid in consideration of
past service that is no less in value than the fair equivalent of the money the
Company would have received if the Shares had been issued for money.

22.3              If so determined by the Company, in lieu of the issue or
provision of Shares, the Company may satisfy the issuance or provision of Shares
under the Program, in whole or in part, by the payment of a cash amount to a
Participant on the Release Date. The amount of such payment shall be equal to
the number of Shares in respect of which the Company makes such a determination,
multiplied by the Market Price on the Release Date, subject to any applicable
withholding tax.

23.               MAXIMUM NUMBER OF SHARES TO
                  BE ISSUED UNDER PROGRAM

23.1              The number of Shares which may be issued from the treasury of
the Company under this Program is limited to 1,000,000. The number of Shares
which may be issued pursuant to the Program to any one person shall not exceed
1% of the issued and outstanding voting securities of the Company. In each case,
the Company may from time to time designate such other maximum number which,
however, will not in any event exceed the maximum number permitted from time to
time under Stock Exchange Rules.

23.2              If Performance Units are forfeited under this Plan, they shall
again be available for allocation under this Program.

24.               CHANGES IN SHARE CAPITAL

24.1              If the number of outstanding Shares shall be increased or
decreased as a result of a stock split, consolidation, subdivision,
reclassification or recapitalization and not as a result of the issuance of
Shares for additional consideration or by way of a stock dividend in the
ordinary course, the Company may make appropriate adjustments to any maximum
number of Shares which can be issued under the Program and the number of
Performance Units granted to each Participant. Any determinations by the Company
as to the adjustments shall be made in its sole discretion and all such
adjustments shall be conclusive and binding for all purposes under the Program.



<PAGE>

                                      -21-

25.               REORGANIZATION

25.1              In the event of a Reorganization or proposed Reorganization,
the Company, at its option, may, subject to Stock Exchange Rules, do either of
the following:

         (a)      the Company may irrevocably commute for or into any other
                  security or other property or cash any Performance Unit upon
                  giving to any Participant to whom such Performance Unit has
                  been granted at least 30 days' written notice of its intention
                  to commute the Performance Unit, and during such period of
                  notice, the Participant may elect to require the Company to
                  issue or provide the Performance Units in the Participant's
                  account as Shares, without regard to the limitations contained
                  in section 20.1, or

         (b)      the Company, or any corporation which is or would be the
                  successor to the Company or which may issue securities in
                  exchange for Shares upon the Reorganization becoming
                  effective, may offer any Participant the opportunity to obtain
                  securities into which the Shares are changed or are
                  convertible or exchangeable, on a basis proportionate to the
                  number of Performance Units in the Participant's account or
                  some other appropriate basis, or some other property; in such
                  event, the Participant shall, if he or she accepts such offer,
                  be deemed to have released his or her rights relating to the
                  Performance Units and such Performance Units shall be deemed
                  to have terminated.

25.2              The Company may specify in any notice or offer made under
section 25.1, that, if for any reason, the Reorganization is not completed, the
Company may revoke such notice or offer. The Company may exercise such right by
further notice in writing to the Participant and the Performance Unit shall
thereafter continue to be allocated to the Participant in accordance with its
terms.

25.3              Subsections (a) and (b) of section 25.1 are intended to be
permissive and may be utilized independently or successively or in combination
or otherwise, and nothing therein contained shall be construed as limiting or
affecting the ability of the Company to deal with Performance Units in any other
manner.




<PAGE>


                                   SCHEDULE A

    CELESTICA INC. INLAND REVENUE APPROVED RULES FOR UNITED KINGDOM EMPLOYEES
                                ("THE SUB-PLAN")


1.       GENERAL

         This schedule to the Celestica Inc. Long Term Incentive Plan ("the
         Plan") sets out the Inland Revenue approved rules for United Kingdom
         employees ("the Sub-Plan").

2.       ESTABLISHMENT OF SUB-PLAN

         Celestica Inc. ("the Company") has established the Sub-Plan under
         section 3.4 of the Plan, which authorises the Company to add to or
         amend any provisions of the Plan (i).

3.       PURPOSE OF SUB-PLAN

         The purpose of the Sub-Plan is to enable the grant to, and subsequent
         exercise by, employees and directors in the United Kingdom, on a tax
         favoured basis, of options to acquire shares in the Company under the
         Plan.

4.       INLAND REVENUE APPROVAL OF SUB-PLAN

         The Sub-Plan is intended to be approved by the Inland Revenue under
         Schedule 9 to ICTA 1988.

5.       RULES OF SUB-PLAN

         The rules of the Plan, in their present form and as amended from time
         to time, shall, with the modifications set out in this schedule, form
         the rules of the Sub-Plan. In the event of any conflict between the
         rules of the Plan and this schedule, the schedule shall prevail.

6.       RELATIONSHIP OF SUB-PLAN TO PLAN

         The Sub-Plan shall form part of the Plan and not a separate and
         independent plan.


7.       INTERPRETATION

7.1      In the Sub-Plan, unless the context otherwise requires, the following
         words and expressions have the following meanings:


<PAGE>

                                      -A2-

<TABLE>
<CAPTION>
<S>                                     <C>
         APPROVAL DATE                  The  date on  which  the  Sub-Plan  is  approved  by the
                                        Inland Revenue under Schedule 9 to ICTA 1988;

         ASSOCIATED COMPANY             The meaning given to that  expression by section  187(2)
                                        of ICTA 1988;(ii)

         CLOSE COMPANY                  The meaning given to that  expression by section  414(1)
                                        of, and paragraph 8 of Schedule 9 to, ICTA 1988;(iii)

         CONSORTIUM                     The  meaning  given to that  word by  section  187(7) of
                                        ICTA 1988;(iv)

         CONTROL                        The  meaning  given to that word by section  840 of ICTA
                                        1988 and "Controlled" shall be construed accordingly;(v)

         ELIGIBLE EMPLOYEE              an individual who is:

                                        (a)   an employee of a Participating Company; or

                                        (b)   a director of a Participating Company who is contracted
                                              to work at least 25 hours per week for the Company
                                              and its subsidiaries or any of them (exclusive
                                              of meal breaks)

                                        and who, in either case, does not have at the Date of Grant
                                        of an Option, and has not had during the preceding twelve
                                        months, a Material Interest in a Close Company which is the
                                        Company or a company which has Control of the Company
                                        or a member of a Consortium which owns the Company;

         ICTA 1988                      The Income and Corporation Taxes Act 1988;

         MARKET VALUE                   Notwithstanding section 6.2 of the Plan:
</TABLE>


<PAGE>

                                      -A3-

<TABLE>
<CAPTION>
<S>                                     <C>

                                        (a)   in the case of an Option granted under the Sub Plan:

                                                  (i)      if at the relevant time the Shares
                                                           are listed on the New York Stock
                                                           Exchange(vi) the last reported selling
                                                           price of a Share on the New York
                                                           Stock Exchange as reported in the
                                                           [Wall Street Journal] for the
                                                           dealing day immediately preceding
                                                           the Date of Grant of the Option
                                                           (for the avoidance of doubt, if
                                                           there were no trades on the day
                                                           immediately preceding the Date of
                                                           Grant, the weighted average trading
                                                           price of the Shares for the
                                                           previous five days on which the
                                                           shares traded on the New York Stock
                                                           Exchange); or

                                                  (ii)     at the discretion of the Committee,
                                                           the last reported selling price of
                                                           a Share on the New York Stock
                                                           Exchange as reported in the [Wall
                                                           Street Journal] on the Date of
                                                           Grant of the Option (for the
                                                           avoidance of doubt, if there were
                                                           no trades on the Date of Grant, the
                                                           weighted average trading price of
                                                           the Shares for the previous five
                                                           days on which the shares traded on
                                                           the New York Stock Exchange);

                                                  (iii)    if paragraphs (i) or (ii) do not
                                                           apply, the market value of a Share
                                                           as determined in accordance with
                                                           Part VIII of the Taxation of
                                                           Chargeable Gains Act 1992 and
                                                           agreed in advance with the Inland
                                                           Revenue Shares Valuation Division
                                                           on the Date of Grant
</TABLE>



<PAGE>

                                      -A4-

<TABLE>
<CAPTION>
<S>                                     <C>


                                                           of the Option
                                                           or such earlier date or dates as
                                                           may be agreed with the Board of
                                                           Inland Revenue;


                                        (b)      in the case of an option granted
                                                 under any other share option
                                                 scheme, the market value of an
                                                 ordinary share in the capital of
                                                 the Company determined under the
                                                 rules of such scheme for the
                                                 purpose of the grant of the option;

         MATERIAL INTEREST              the meaning given to that  expression by section  187(3)
                                        of ICTA 1988;(vii)



         NOTIFICATION OF GRANT OF       the  notification  issued in  respect of the grant of an
         OPTION                         option;

         OPTION                         a subsisting  right to acquire  Shares granted under the
                                        Sub-Plan;

         OPTION HOLDER                  an individual  who holds an Option or, where the context
                                        permits, his legal personal representatives;

         ORDINARY SHARE CAPITAL         the meaning given to that  expression by section  832(1)
                                        of ICTA 1988; and

         PARTICIPATING COMPANY          the Company or a Subsidiary over which the
                                        Company has Control unless such
                                        Subsidiary has been excluded from
                                        participation by the Committee;

         SUBSIDIARY                     the  meaning  given to that word in  section  736 of the
                                        Companies Act 1985;
</TABLE>

7.2      In this schedule, unless the context otherwise requires:

         7.2.1    words and expressions not defined above have the same meanings
                  as are given to them in the Plan;

         7.2.2    the rule headings are inserted for ease of reference only and
                  do not affect their interpretation;



<PAGE>

                                      -A5-


         7.2.3    a reference to a rule is a reference to a rule in this
                  schedule;

         7.2.4    the singular includes the plural and vice-versa and the
                  masculine includes the feminine; and

         7.2.5    a reference to a statutory provision is a reference to a
                  United Kingdom statutory provision and includes any statutory
                  modification, amendment or re-enactment thereof.

8.       COMPANIES PARTICIPATING IN SUB-PLAN

         For the avoidance of doubt reference in the Plan to participation by a
         Designated Affiliated Entity of the Company shall be disregarded for
         the purposes of the Sub-Plan.

9.       SHARES USED IN SUB-PLAN

         The Shares shall form part of the Ordinary Share Capital of the Company
         and shall at all times comply with the requirements of paragraphs 10 to
         14 of Schedule 9 to ICTA 1988.(viii)

10.      GRANT OF OPTIONS

         An option granted under the Sub-Plan shall be granted under and subject
         to the rules of the Plan as modified by this schedule.


11.      IDENTIFICATION OF OPTIONS

         A Notification of Grant of Option issued in respect of an Option shall
         expressly state that it is issued in respect of an Option. An option
         which is not so identified shall not constitute an Option.

12.      CONTENTS OF NOTIFICATION OF GRANT OF OPTION

         A Notification of Grant of Option issued in respect of an Option shall
         state:

         a)       that it is issued in respect of an Option;

         b)       the Date of Grant of the Option;

         c)       the number of Shares subject to the Option;

         d)       the exercise price of the Shares under Option;

         e)       any performance target or other condition imposed on the
                  exercise of the Option; and


<PAGE>

                                      -A6-


         f)       the date(s) on which the Option will ordinarily become
                  exercisable.

13.      EARLIEST DATE FOR GRANT OF OPTIONS

         An Option may not be granted earlier than the Approval Date.

14.      PERSONS TO WHOM OPTIONS MAY BE GRANTED

         An Option may not be granted to an individual who is not an Eligible
         Employee at the Date of Grant. For the avoidance of doubt, and
         notwithstanding sections 1, 2.1(g) and 2.1(t)(iii) of the Plan an
         Option may not be granted under the Sub-Plan to a Consultant.

15.      OPTIONS NON TRANSFERABLE

         An Option shall be personal to the Eligible Employee to whom it is
         granted and shall not be capable of being transferred, charged or
         otherwise alienated and shall lapse immediately if the Option Holder
         purports to transfer, charge or otherwise alienate the Option.

         The reference in section 3.6 of the Plan to transfers of Options to a
         spouse, a personal holding company or family trust controlled by a
         Participant and the reference to Beneficiaries in section 2.1(b) of the
         Plan shall be disapplied for the purposes of the Sub-Plan.

16.      LIMIT ON NUMBER OF SHARES PLACED UNDER OPTION UNDER SUB-PLAN

         For the avoidance of doubt, Shares placed under Option under the
         Sub-Plan shall be taken into account for the purpose of section 3.2 of
         the Plan.

17.      INLAND REVENUE LIMIT (L30,000)

         An Option may not be granted to an Eligible Employee if the result of
         granting the Option would be that the aggregate Market Value of the
         shares subject to all outstanding options granted to him under the
         Sub-Plan or any other share option scheme established by the Company or
         an Associated Company and approved by the Board of Inland Revenue under
         Schedule 9 to ICTA 1988 (other than a savings related share option
         scheme) would exceed sterling L30,000 or such other limit as may from
         time to time be specified in paragraph 28 of Schedule 9 to ICTA
         1988(ix). For this purpose, the United Kingdom sterling equivalent of
         the Market Value of a Share on any day shall be determined by taking
         the noon day sterling/US dollar exchange rate for that day as quoted
         by the Bank of Canada.

18.      EXERCISE PRICE OF SHARES UNDER OPTION

         The amount payable per Share on the exercise of an Option shall not be
         less than the Market Value of a Share on the Date of Grant and shall be
         stated on the Date of Grant.


<PAGE>

                                      -A7-

19.      PERFORMANCE TARGET OR OTHER CONDITION IMPOSED ON EXERCISE OF
         OPTION

         Any performance target or other condition imposed on the exercise of an
         Option under section 6.3 of the Plan shall be:

         19.1     objective;

         19.2     such that, once satisfied, the exercise of the Option is not
                  subject to the discretion of any person; and

         19.3     stated on the Date of Grant.

         If an event occurs as a result of which the Committee considers that a
         performance target or other condition imposed on the exercise of an
         Option is no longer appropriate and substitutes, varies or waives under
         section 3.4 of the Plan the performance target or condition, such
         substitution, variation or waiver shall:

         19.4     be reasonable in the circumstances; and

         19.5     produce a fairer measure of performance and be neither
                  materially more nor less difficult to satisfy.

20.      EXERCISE OF OPTIONS BY LEAVERS

         The period during which an Option shall remain exercisable following
         termination of employment shall be as stated in the Notification of
         Grant of Option or in the absence of any stated period therein shall be
         as set out in section 7.3 of the Plan, except that the reference in
         section 7.3 of the Plan to "unless the Company at any time otherwise
         determines" shall be disapplied for the purposes of the Sub-Plan.


21.      LATEST DATE FOR EXERCISE OF OPTIONS

         The period during which an Option shall remain exercisable shall be
         stated in the Notification of Grant of Option and any Option not
         exercised by that time shall lapse immediately.

22.      MATERIAL INTEREST

         An Option may not be exercised if the Option Holder then has, or has
         had within the preceding twelve months, a Material Interest in a Close
         Company which is the Company or which is a company which has Control of
         the Company or which is a member of a Consortium which owns the
         Company.


<PAGE>

                                      -A8-

23.      MANNER OF PAYMENT FOR SHARES ON EXERCISE OF OPTIONS

         The amount due on the exercise of an Option shall be paid in cash or by
         cheque or banker's draft and may be paid out of funds provided to the
         Option Holder on loan by a bank, broker or other person. For the
         avoidance of doubt, the exercise procedure in section 7.5 of the Plan
         shall be disapplied for the purposes of the Sub-Plan if this involves a
         broker transferring to the Company the sale proceeds of optioned
         Shares. The date of exercise of an Option shall be the date on which
         the Company receives the amount due on the exercise of the Option.

24.      ISSUE OR TRANSFER OF SHARES ON EXERCISE OF OPTIONS

         The Company shall, as soon as reasonably practicable after the date of
         exercise of an Option, issue or transfer to the Option Holder, or
         procure the issue or transfer to the Option Holder of, the number of
         Shares specified in the notice of exercise and shall deliver to the
         Option Holder, or procure the delivery to the Option Holder of, a share
         certificate in respect of such Shares together with, in the case of the
         partial exercise of an Option, a Notification of Grant of Option in
         respect of, or the original Notification of Grant of Option endorsed to
         show, the unexercised part of the Option, subject only to compliance by
         the Option Holder with the rules of the Sub-Plan and subject to any
         delay as necessary to complete or obtain:

         24.1     the listing of the Shares on any stock exchange on which
                  Shares are then listed;

         24.2     such registration or other qualification of the Shares under
                  any applicable law, rule or regulation as the Company
                  determines is necessary or desirable; or

         24.3     the making of provision for the payment or withholding of any
                  taxes required to be withheld in accordance with the
                  applicable law of any foreign jurisdiction in respect of the
                  exercise of the Option or the receipt of the Shares

25.      RIGHTS ATTACHING TO SHARES ISSUED ON EXERCISE OF OPTIONS

         All Shares issued on the exercise of an Option shall, as to any voting,
         dividend, transfer and other rights, including those arising on a
         liquidation of the Company, rank equally in all respects and as one
         class with the Shares in issue at the date of such exercise save as
         regards any rights attaching to such Shares by reference to a record
         date prior to the date of such exercise.

         Reference in section 6.3(b)(iii) of the Plan to imposing restrictions
         of the re-sale of Shares acquired on the exercise of Options shall be
         disapplied to the extent that these do not apply to all share of the
         same class or not otherwise permitted by paragraph 12(2) of Schedule 9
         to ICTA.


<PAGE>

                                      -A9-


26.      AMENDMENT OF SUB-PLAN

         Notwithstanding section 3.4 of the Plan, no amendment of the Sub-Plan,
         shall take effect until it has been approved by the Inland Revenue.

27.      ADJUSTMENT OF OPTIONS

         Notwithstanding section 9.1 of the Plan, no adjustment may be made to
         an Option until it has been approved by the Inland Revenue.

28.      EXERCISE OF DISCRETION BY COMMITTEE

         In exercising any discretion which it may have under the Sub-Plan, the
         Committee shall act fairly and reasonably.

29.      DISAPPLICATION OF CERTAIN PROVISIONS OF PLAN

         The provisions of the Plan dealing with:

         a)       Rights;

         b)       Performance Units; and

         c)       loans to Participants

         shall not form part of, and no such rights may be granted under, the
         Sub-Plan.

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

Notes
i The Company is the "grantor" as defined in paragraph 1 of Schedule 9 to ICTA
1988 because it has established the Sub-Plan. In most cases, it will also be the
Company which grants options under the Sub-Plan, although this is not a
requirement of UK tax legislation.

ii A company is treated as another's "associated company" at a given time if, at
that time or at any other time within one year previously, one of the two has
control of the other, or both are under the control of the same person or
persons. A person is taken to have control of a company if he exercises, or is
able to exercise or is entitled to acquire, direct or indirect control over the
company's affairs and, in particular, if he possesses or is entitled to acquire
the greater part of the company's issued share capital or the voting power in
the company. UK tax legislation contains two definitions of control: the
definition of control here is different from that in paragraph 4 below.

iii A close company is a company which is under the control (as defined in
paragraph 1 above) of five or fewer participators (eg shareholders) or of any
number of participators who are directors. There are attributed to a
participator all the rights and powers (eg shares, voting power) of, inter alia,
a company which he controls or of an "associate" (eg relative) of his.
Ordinarily, a company is excluded from being a close company if it is non UK
resident or 35% of the voting power in the company is held by the public and its
shares have been listed, and the subject of dealings, on a recognised stock
exchange within the preceding 12 months. However, for the purpose of the
material interest test (see paragraph 5 below), this exclusion does not apply
with the result that the normal definition of a "close company" is extended.


<PAGE>

                                      -A10-

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

iv A company is a member of a consortium owning another company if it is one of
a number of companies which between them beneficially own not less than
three-quarters of the other company's ordinary share capital and each of which
beneficially owns not less than one-twentieth of that capital.

v Control means the power of a person to secure:
(a) by means of the holding of shares or the possession of voting power in or in
relation to that or any other body corporate; or
(b) by virtue of any powers conferred by the articles of association or other
document regulating that or any other body corporate that the affairs of the
first-mentioned body corporate are conducted in accordance with the wishes of
that person.

vi The expression "recognised stock exchange" is defined in section 841 of ICTA
1988. "Recognised stock exchange" means the London Stock Exchange Limited and
any stock exchange outside the UK which has been designated by the Inland
Revenue as a recognised stock exchange. This includes, inter alia, the New York
Stock Exchange, NASDAQ and any exchange registered with the US Securities and
Exchange Commission as a national securities exchange. However, clearance is
required from the Shares Valuation Division before the NASDAQ price may be used
to determine the market price of a NASDAQ listed share.

vii A person has a material interest in a company if he, either on his own or
with one or more associates, or if any associate of his with or without such
other associates:
(a) is the beneficial owner of, or able, directly or through the medium of other
    companies, or by any other indirect means to control, more than 10 per cent
    of the ordinary share capital of the company; or
(b) where the company is a close company, possesses, or is entitled to acquire,
    such rights as would, in the event of the winding-up of the company or in
    any other circumstances, give an entitlement to receive more than
    10 per cent of the assets which would then be available for distribution
    among the participators.

viii The shares used in the scheme must be:
(a)  ordinary shares;
(b)  fully paid up;
(c)  not redeemable; and
(d)  save for certain limited exceptions, not subject to any restrictions which
     do not apply to all shares of the same class.
The shares used in the scheme must be:
(a)  of a class listed on a recognised stock exchange; or
(b)  shares in a company which is not under the control of another company; or
(c)  shares in a company which is under the control of another company (other
     than a company which is, or would if resident in the UK be, a close
     company) whose shares are listed on a recognised stock exchange.
The shares used in the scheme form part of the ordinary share capital of:
(a)  the grantor (ie the company which has established the scheme); or
(b)  a company which has control of the grantor; or
(c)  a company which either is, or has control of, a company which is a member
     of a consortium owning either the grantor or a company having control of
     the grantor.
Where the company whose shares are to be used in a scheme has more than one
class of ordinary share, the majority of the issued shares of the same class as
those which are to be used must be either employee control shares (see below)
or:
(a)  must not be held by persons (including trustees holding shares on
     behalf of such persons) who acquired their shares in pursuance of a
     right conferred on them or opportunity offered to them as directors or
     employees of any company, and not in pursuance of an offer to the
     public; and
(b)  if the shares are not listed on a recognised stock exchange and the company
     is under the control of another company whose shares are so listed, must
     not be held by companies which have control of the company whose shares are
     in question or of which that company is an associated company.
Shares are employee control shares if:
(a)  the persons holding them are, by virtue of their holding of shares of that
     class, together able to control the company; and
(b)  those persons are, or have been, employees or directors of the company or
     of another company which is under the control of the company.


<PAGE>

                                      -A11-

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ix UK tax legislation imposes a limit (currently L30,000) on the "value" of the
outstanding options which may be held by an individual participant in an Inland
Revenue approved executive share option scheme.