**Exhibit4.1.4**

 

26 October 2004

 

Mr John McFarlane

Chief Executive Officer

ANZ Banking Group Limited

32/100 Queen Street

Melbourne Vic 3000

 

Dear John

 

The Board of Directors is very pleased that we havemutually agreedfor an extension of a further 12 months to 30 September 2007. We congratulateyou on your continuing leadership of the Bank for our shareholders, our people,our customers and the communities in which we live.

 

Further to our recent discussions, on behalf of theBoard I am pleased to confirm the variations to your existing contract dated 23October 2001 as stated below. This letter is to be read in conjunction withyour existing employment agreement. Clause numbers refer to your original contract.

 

# **2.**                            OperativeDate

 

By mutualagreement, your employment agreement is extended by 12 months to 30 September2007.

 

# **3.**                            Remuneration

 

The details ofyour remuneration are set out in the Schedule. The Schedule forms part of this letter of variation.

 

# **12.**                     Terminationof Employment

 

***12.3******              Termination by ANZ***

 

***(a)******                       Termination onNotice***

 

(i)                 ANZ may terminate your employment for any reason (other than (b)) bygiving you written notice equal to the unexpired term of the employmentagreement (which ends on September 30, 2007).

 

(ii)              In the event that clause 12.3(b) is not applicable, and ANZ breachesits contractual obligation under clause 12.3(a)(i) by terminating youremployment without the notice set out in clause 12.3(a)(i), the parties agreethat the damages for breach by ANZ of that contractual obligation shall be theTEC that you would have received during that part of the notice period that youwere not able to serve due to ANZ’s early termination of the employmentagreement.

 

The Board isconfident that you can continue the Group’s current momentum with a focus ongrowth and continue to enhance shareholder value. It looks forward with muchpleasure to continuing to work with you.

 

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I enclose aduplicate original of this letter of variation. Please sign and return it to me as acceptance of the terms of variation.

 

 
| Yours  sincerely                                    |
|-----------------------------------------------------|
|                                                |
|                                                |
| **Charles Goode**                                   |
| **Chairman**                                        |
| **AUSTRALIA AND NEW ZEALAND BANKING GROUP LIMITED** |

 

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**VARIATION TO SCHEDULE**

**REMUNERATION ENTITLEMENTS, INCLUDINGPAYMENTS ON TERMINATION**

 
| Name:            | **John  McFarlane**                                |
|------------------|----------------------------------------------------|
| Title:           | **Chief Executive  Officer**                       |
| Location:        | **100  Queen Street, Melbourne**                   |
| Reporting To:    | **Board of  Directors, ANZ Banking Group Limited** |
| Schedule Issued: | **26 October 2004**                                | Effective Date: | **1 October 2003** |

 

This Scheduleforms part of your employment agreement.

 

In accordance with the ANZ Director’s Share Plan, you may elect to foregopart of your TEC or any bonus you may receive in order to purchase ANZ Sharesto an equivalent value.  (Refer ANZDirector’s Share Plan Rules).  You haveadvised that you presently intend to exercise this election for all futurebonuses and for that proportion of your TEC in excess of what is required foryour mandatory superannuation contributions and other payroll deductions.

 

**1****                               TotalTarget Reward**

 

Your Total Target Reward (TTR) is a combination of Fixed Reward – TEC(50% of TTR) plus Variable Reward  (50%of TTR).  Your annualised TTR is $4,000,000.

 

***1.1******                     Fixed Reward - TEC***

 

Your TECpackage is now $2,000,000 perannum.

 

***1.2******                     Variable Reward***

 

Your target bonus opportunity is now $2,000,000 perannum.

 

Bonus payments are subject to performance against annualtargets and are at the discretion of the Board. Your targets for FY2005 havebeen agreed with you.

 

**1.3****                   ****ANZPerformance Shares**

 

The Board will put aproposal before shareholders at the Annual General Meeting in December 2004,that you be issued with a tranche of Performance Shares. Subject to obtaining shareholder approval, itis proposed that you will be offered the following Performance Shares on theterms and conditions approved by shareholders:

 
| Number of Performance Shares: |   | 175,000                              |
|-------------------------------|--------|--------------------------------------|
| Date of Grant:                |   | 31 December 2004                     |
| Performance Period:           |   | 31 December 2006 to 31 December 2009 |

 

It is proposed that theseterms and conditions will include vesting conditions (as set out below) andthat you will be entitled to receive dividends only from the time the shareshave vested (as set out below).

 

**1.3.1****                   ****Vesting ofPerformance Shares**

 

The vesting of Performance Shares will be subject to time and performancehurdles being satisfied.

 

•                  The performance hurdle will bemeasured during the performance period by comparing ANZ’s Total ShareholderReturn (ANZ TSR) with that of a comparator group of major financial servicescompanies in the S&P/ASX 100 Index, excluding

 

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the ANZ. The companies to be used in the comparator group will be as approved bythe Board.

•                  The percentage of Performance Shares that willvest will depend upon the TSR achieved by ANZ relative to the companies in thecomparator group.  Performance equal tothe median TSR of the comparator group will result in half the PerformanceShares vesting. For each percentile above the median an additional 2% ofPerformance Shares will vest, increasing on a straight-line basis until all ofthe Performance Shares vest where ANZ TSR is at or above the 75thpercentile of TSRs in the comparator group.

•                  TSR will be measured for ANZ and thecomparator group over the same period (since grant) and calculated as at thelast trading day of any month, once the performance period has commenced. Thefirst opportunity for performance shares to vest will be after the secondanniversary of grant, after which the performance shares will continue to betested monthly until they are forfeited 5 years after the grant date, or 100%vest, whichever is the earlier.

 

In case of death or total and permanent disability or where it isotherwise considered appropriate by the Board, the Board may amend the termsupon which the Performance Shares may vest.

 

**1.3.2       Forfeitureof Performance Shares**

 

You will forfeit ownership of the Performance Shares:

 

•                  If they have not vested by the end ofthe Performance Period; or

•                  If you cease to be an employee of theCompany by reason of termination of your employment for:-

•                  Serious misconduct; or

•                  For serious breach of your contract ofemployment; or

•                  If you resign without the priorapproval of the Board.

 

**1.3.3       EarlyForfeiture Date**

 

If you cease to be the Chief Executive Officer of the Company prior to 30September 2007, and the Performance Shares are not forfeited for one of thereasons set out in 1.3.2, the forfeiture date for this tranche will then be thedate that is six months after you cease to be Chief Executive Officer or suchlonger period as the Board may approve.

 

**1.4**                              **Superannuation**

 

Your notional salary is used to calculate your personalsuperannuation contributions (if any) and the level of mandatory superannuationcontributions.  It is also used tocalculate the insured component of your death and total and permanentdisablement benefits.  For full detailsof the ANZ Australian Staff Superannuation Scheme, refer to the member’sbooklet.

 

In addition to mandatory superannuation contributions, ANZwill make top–up employer contributions of $300,000 per annum paid quarterly,to your chosen superannuation fund (either ANZ Staff Superannuation Fund oryour own Self Managed Superannuation Fund).

 

Should you cease to be the Chief Executive Officer of theCompany prior to September 30, 2007, the annual contribution for that year willbe pro-rated to the date of termination.

 

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##### **ACCEPTANCE**

 

I, JohnMcFarlane, have read and understood and agree to the terms of this letter ofvariation to my employment agreement (including the Schedule).

 

 
| Name:    John  McFarlane |   |
|----------------------------------------------|--------|
|                                         |   |
|                                         |   |
| Signature:                                   |   |   | Date: |   |   |
|                                         |   |
|                                         |   |
| /S/  J. McFarlane                            |   |   |
| Dated:  26/10/04                             |   |
|                                              |        |  |  |  |  |  |

 

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23 October2001

 

Mr JohnMcFarlane

Chief ExecutiveOfficer

ANZ Banking Group Limited

32/100 QueenStreet

Melbourne   Vic  3000

 

Dear John

 

I am pleased,on behalf of the Board of the Directors, to confirm your ongoing role of ChiefExecutive Officer and an executive member of the Board, of Australia and NewZealand Banking Group Ltd (ANZ).

 

I would liketo compliment you on the outstanding leadership you have provided to the Bankover the last four years.  There is anexcellent relationship between you and the Board and you have made a number ofstrategic initiatives which have shown good judgment, knowledge of the industryand an ability for decisive actions. Recent positive outcomes in terms of enhanced shareholder value andother performance indicators have been gratifying.

 

This lettersets out the terms of your employment, and constitutes your employmentagreement with ANZ (“employment agreement”). This employment agreement replaces all existing agreements,arrangements, or understandings between ANZ and you. (References to ANZ, itshould be noted, include any corporation that is related to ANZ underCorporations Law).

 

# **1**.                            CurrentPosition, Reporting Arrangements and Location

 

TheChief Executive is responsible to the Board of Directors for the successfulmanagement and leadership of the organisation. The Chief Executive and his team are responsible for providing a strong,competitive and sustainable return to shareholders.

 

TheChief Executive is a full-time position and you are expected to ensure that theorganisation is perceived by customers, staff and the community to be ofoutstanding quality wherever it operates, to attract and develop staff of thehighest calibre, and to excel in the way it makes decisions, manages change andservices customers.

 

TheBoard looks forward to you successfully accomplishing a number of objectiveswhich include the ANZ share price outperforming the Banking & Finance ShareIndex; a continuous strengthening of the broader executive team; a focus on thecustomer; and a significant improvement in our staff satisfaction levels and inthe quality of values and culture being inculcated in the organisation.

 

# **2**.                            OperativeDate

 

This agreementwill commence on 1 October 2002 and is subject to clauses 12.2 and 12.3.  It is for a four year period.  It may be extended or renewed by mutualagreement.  ANZ will notify you not laterthan six months before the end of that period whether or not it intends tooffer to extend or renew this agreement, and if so, for how long.

 

# **3**.                            Remuneration

 

The details ofyour remuneration are set out in the Schedule. The Schedule forms part of this employment agreement.

 

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# **4**.                            Leave

 

## ***4****.1**                    **Annual Leave*

 

You willreceive 4 weeks’ contracted hours paid annual leave for each completed year ofpaid service.  You are required to takeyour full annual leave entitlement, 4 weeks, over the course of each bankfinancial year and must take at least 10 consecutive days leave in each year.

 

At theend of each bank financial year ANZ will deem you to have taken your full 4weeks leave.  Accordingly there will beno accrual of this leave and your annual leave balance at 1 October each yearwill never be more than your balance at 1 October of the previous year.

 

## ***4****.2**                    **Sick Leave*

 

You may takesick leave in accordance with standard arrangements applicable to all ANZ employees.  Any untaken part of this entitlement iscumulative from year to year.  In theevent of prolonged illness, ANZ may decide at its discretion to provide youwith sick leave in excess of your sick leave entitlements.  You are not entitled to any payment forunused sick leave when your employment with ANZ ends.

 

## ***4****.3**                    **Parental Leave*

 

You may takeparental leave in accordance with standard arrangements applicable to all ANZemployees.

 

## ***4****.4**                    **Long Service Leave*

 

You areeligible for 13 weeks long service leave after completing 15 years of service,and a further 8.66 weeks for each subsequent 10 completed years ofservice.  You may access long serviceleave on a pro-rata basis after 10 years of service.

 

# **5**.                            Ownershipof Intellectual Property and Trade Secrets

 

Allinventions, discoveries, computer software processes and improvements made byyou during your employment with ANZ remain the property of ANZ.

 

By signingthis employment agreement, you:

 

•             assign to ANZ allproprietary rights including all ownership rights and copyright and theexclusive right to develop, make, use, sell, license or otherwise benefit fromany inventions, discoveries, processes and improvements, made within the scopeof your employment with ANZ; and

•             agree to execute anyfurther document that is necessary or desirable to give full effect to yourobligations in this paragraph.

 

# **6**.                            Valuesand Ethical Standards

 

ANZ hasdeveloped guiding values and expects you actively to ensure they are anintegral part of the way that you, and those who report to you, carry outduties within ANZ.

 

ANZ expectsyou to further ANZ’s objectives and reputation and faithfully and diligently toperform your duties, exercise your powers, and manage with integrity andrespect all matters concerning ANZ employees and customers.

 

ANZ also hascertain ethical standards which you are required to maintain.  In particular, you must not in any way,either directly or indirectly become engaged, concerned or interested in anybusiness whether as principal, partner, director, agent, promoter orbeneficiary except that of ANZ.  Thisrequirement may be waived at ANZ’s discretion by a written consent signed bythe Chairman.

 

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# **7**.                            Conduct

 

You must atall times act honestly and in a manner that is consistent with the status ofyour position with ANZ.  You indemnifyANZ against any loss or damage it suffers as a result of any dishonest act byyou, or any wilful misconduct in carrying out your duties.

 

# **8**.                            Policiesand Procedures, Performance Agreements

 

## ***8****.1**                    **Policies and Procedures*

 

In addition tothe terms and conditions contained in this employment agreement, there areother policies and procedures that apply to your employment. These policies andprocedures are formulated by ANZ for the efficient and fair administration ofemployment and other business matters. You must diligently comply with ANZ’spolicies and procedures, as amended from time to time.

 

## ***8****.2**                    **Performance Agreements*

 

Performanceagreements will be agreed annually between you and ANZ, but may be reviewed andvaried during the performance period.

 

# **9**.                            ConfidentialInformation

 

You must notdisclose or use in any manner (except in the proper course of your employment,by compulsion of law, or on the written direction of an authorised officer ofANZ or its auditors) any information about ANZ, its customers or its affairswhich you acquire during your employment with ANZ, unless the information isalready legitimately in the public domain. This obligation extends after your employment with ANZ ends.

 

You must alsoreturn to ANZ on request or immediately your employment with ANZ ends:

 

•             all books, papers,documents and other property which belong or relate to ANZ, its customers orits affairs, and any copies of such documents; and

•             any vehicle, computerhardware or software, key, security pass or other property which belongs toANZ.

 

# **10**.                     Restraint

 

You must notat any time, either during your employment with ANZ or for 12 months after youremployment with ANZ ends (or for such lesser time as a court may deemreasonable) either on your own account or for or jointly with any other personsolicit, interfere with or attempt to entice away from ANZ any person who, atany time within the period of one year before the date your employment with ANZends, was a customer or employee of, or in the habit of dealing with, ANZ.

 

Except withthe written consent of the Chairman, you will not for a period of six monthsafter your employment with ANZ ends, be in any way, either directly or indirectly,engaged, concerned or interested in any manner whatsoever, whether asprincipal, partner, director, agent, promoter or beneficiary in the business ofany other financial institution in Australia.

 

# **11**.                     DisciplinaryAction

 

If you fail tocomply with the provisions of your employment agreement or any other ANZperformance requirements, ANZ may take disciplinary action which may includesuspension with or without pay and, in certain circumstances, termination ofyour employment (see paragraph 12).

 

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# **12**.                     Resignationand Termination

 

## ***12****.1**             **Termination Entitlements*

 

Yourtermination entitlements will depend upon the circumstances of the terminationand are set out in this clause and in the Schedule. These will be the onlyentitlements paid to you upon the termination of your employment with ANZ.

 

Thesetermination provisions apply even if your current position changes, unless theyare expressly varied under paragraph 13.

 

## ***12****.2**             **Resignation, including Retirement*

 

You mayterminate your employment for any reason by giving ANZ 12 months writtennotice. You and ANZ may agree on a lesser period of notice, or ANZ may in itsdiscretion waive the notice period or any part of it. If ANZ waives the noticeperiod or any part of it, entitlements on termination will not include anypayment in respect of the waived period.

 

## ***12****.3**             **Termination by ANZ*

 

***(a)******                       Termination onNotice***

ANZ may end your employment for any reason by giving you written noticeequal to the unexpired term of the employment agreement (which ends on 1October 2006).  At the election of eitherparty, payment of TEC in lieu of some or all of the period of notice may bemade, and such payment shall not be reduced by reason of any duty to mitigateyour loss upon termination of employment.

 

***(b)******                       SeriousMisconduct***

ANZ mayend your employment agreement at any time, without notice, because of your:

 

(i)                          seriousmisconduct;

 

(ii)                       loss ofqualification to hold office as a director under section 203B of theCorporations Act (or any successor or equivalent provision);

 

(iii)                    serious neglect ofduty; or

 

(iv)                   serious breach ofany significant term of this employment agreement.

 

In suchcircumstances, you will be entitled only to payment of TEC up to the date oftermination.

 

In thecase of termination under (iii) and (iv) above, you will receive not less than14 days’ notice of the Board meeting at which the termination will beconsidered.

 

***(c)******                        Death orPermanent Disability***

In the event of your death or permanent disability, all of yourentitlements will be those set out in the Schedule.

 

# **13**.                     Variationsto Conditions of Employment

 

Variations toyour employment agreement may be necessary for the fair, efficient andeffective administration of ANZ’s business. Accordingly, this employmentagreement may be varied by agreement from time to time. Your consent to suchvariation must not be unreasonably withheld. If your consent is unreasonablywithheld, ANZ may give you one month’s written notice that such variation willtake effect.

 

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# **14**.                     Relevantlaw

 

Thisemployment agreement takes effect under, is governed by and is to beinterpreted according to the law of Victoria.

 

**15.****                     Resolution of AnyDispute**

 

Resolution of any dispute arising out of your employment agreement orconcerning its interpretation will be pursued as follows:

 

(a)                        The disputewill be discussed between you and the Chairman with a view to resolution;

 

(b)                       If discussionsfail to resolve the dispute within 14 days, it may be referred by either partyto a mediator agreed by the parties;

 

(c)                        If the disputeremains unresolved for 28 days, the parties may refer the dispute toarbitration by an arbitrator appointed by the parties under the CommercialArbitration Act 1984, whose decision shall be final and binding upon bothparties;

 

(d)                       Nothing in thisclause shall prevent a party from seeking urgent injunctive or similar relieffrom a court in appropriate circumstances.

 

**16.****                     General**

 

The Board is confident that you can continue the Group’s currentmomentum and continue to enhance shareholder value and it looks forward withmuch pleasure to continuing to work with you and to receive your acceptance ofthis agreement.

 

I enclose aduplicate original of this employment agreement.  Please sign and return it to me as acceptanceof the terms of the employment agreement.

 
| Yours  sincerely                                 |
|--------------------------------------------------|
|                                             |
|                                             |
| **Charles Goode**                                |
| Chairman                                         |
| Australia  and New Zealand Banking Group Limited |

 

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**SCHEDULE**

**REMUNERATION ENTITLEMENTS,**

**INCLUDING PAYMENTS ON TERMINATION**

**(TEC BENEFITS)**

 
| Name:            | *John McFarlane*                                |
|------------------|-------------------------------------------------|
| Title:           | *Chief Executive Officer*                       |
| Location:        | *100 Queen Street, Melbourne*                   |
| Reporting  To:   | *Board of Directors, ANZ Banking Group Limited* |
| Effective  Date: | *01 October 2002*                               |

 

This scheduleforms part of your employment agreement.

 

Yourremuneration will be a combination of salary, superannuation and benefits asagreed between you and ANZ from time to time, in advance of services beingprovided, using ANZ’s total employment cost (TEC) methodology. Essentially, TECis the fixed component of remuneration. It is comprised of 65% notional TEC anda 35% cash component (Cashtec) which includes employer and employeesuperannuation contributions. Cashtec is a flexible component that can be directedto motor vehicles, petrol and parking, as well as superannuation. Your salaryand superannuation will be paid fortnightly and other benefits will be providedas applicable.

 

Bonus paymentsare at the discretion of the Board.

 

Salary isdefined as notional salary - that is, 65% of TEC.

 

## **1.0**                     TotalTarget Reward

 

Your Total Target Reward (TTR) is a combination of fixed reward - TEC(60%) plus Variable Reward (40%).  Yourannualised TTR is $2,500,000.

 

**1.1****                     Fixed Reward -TEC**

 

Your TEC package remains at $1,500,000.

 

You must take a minimum of 65% of TEC as notional salary and thebalance is available to you as cash benefit or optional benefits.

 

**1.2****                     Variable Reward -Executive Remuneration Scheme**

 

Unless otherwise specified, bonuses will be paid to you in cash.  Prior to any bonus being approved by theBoard, you may elect to sacrifice up to 100% of the bonus to purchase sharesunder the Director’s Share Plan.

 

**1.3****                     ANZ Share Options**

 

The Board willput a proposal before shareholders at the Annual General Meeting in December2001, that you be issued with the following four tranches of options

 
| **Ist  Tranche**    | ** **                                                                              |
|---------------------|-----------------------------------------------------------------------------------------|
| Number of  options: | 500,000                                                                                 |
| Date of  grant:     | 31 December  2001                                                                       |
| Exercise  Period:   | 31 December  2003 to the Expiry Date                                                    |
| Expiry Date:        | 31 December  2007 or such earlier date as may be provided for in notes 1.3.3 and 1.3.4. |

 

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| **2nd  Tranche**    |                                                                                    |
|---------------------|-----------------------------------------------------------------------------------------|
| Number of  options: | 1,000,000                                                                               |
| Date of  grant:     | 31 December  2002                                                                       |
| Exercise  Period:   | 31 December  2004 to the Expiry Date                                                    |
| Expiry Date:        | 31 December  2007 or such earlier date as may be provided for in notes 1.3.3 and 1.3.4. |

 
| **3rd  Tranche**    |                                                                                    |
|---------------------|-----------------------------------------------------------------------------------------|
| Number of  options: | 1,000,000                                                                               |
| Date of  grant:     | 31 December  2003                                                                       |
| Exercise  Period:   | 31 December  2005 to the Expiry Date                                                    |
| Expiry Date:        | 31 December  2008 or such earlier date as may be provided for in notes 1.3.3 and 1.3.4. |

 
| **4th  Tranche**    |                                                                                    |
|---------------------|-----------------------------------------------------------------------------------------|
| Number of  options: | 500,000                                                                                 |
| Date of  grant:     | 31 December  2004                                                                       |
| Exercise  Period:   | 31 December  2006 to the Expiry Date                                                    |
| Expiry Date:        | 31 December  2008 or such earlier date as may be provided for in notes 1.3.3 and 1.3.4. |

 

Each tranche will only be granted providedyou are CEO of the Company at the date for that grant.

 

**1.3.1**                     Exercise price

Theissue price for each share upon exercise of an option will be the weightedaverage sale price of all fully paid ordinary shares in the Company sold on theAustralian Stock Exchange during the five trading days immediately **after** the Annual General Meeting of the Company held inrespect of the financial year of the Company that ended before the date of thegrant of the relevant tranche of options.

 

**1.3.2.**                  Exercise of Options

Theexercise of the options is subject to a performance hurdle beingsatisfied.  The performance hurdle to besatisfied is:

•                                          one-half of the options in any tranche may be exercised only if theANZ Total Shareholder Return (“**ANZ TSR**”)calculated over the period commencing on the date of grant of the relevanttranche and ending on the last day of any month after the **second**anniversary of their date of grant of the relevant tranche (the “**relevant period**”) exceeds the percentage change in theAccumulated Banks and Finance Index over that same period (very broadly, ANZTSR is the increase in the market price of shares in the Company plus dividendsand distributions on those shares over the relevant period); and

•                                          the other half of the options in the tranche may be exercised onlyif the ANZ TSR calculated over the relevant period exceeds the percentagechange in the S & P /ASX 100 Accumulation Index over that same period.

In caseof death or total and permanent disability or where it is otherwise consideredappropriate by the Board, the Board may amend the terms upon which the optionsmay be exercised.

 

**1.3.3.      Expiry of Options**

 

Options in a tranche lapse:

 

•                  if they have not been exercised by their expiry date; or

 

•                  if you cease to be an employee of the Company by reason oftermination of your employment for:-

 

•                  serious misconduct; or

 

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•                  for serious breach of your contract of employment; or

 

•                  if you resign without the prior approval of the Board.

 

**1.3.4.****                           EarlierExpiry Date**

 

If you cease to be Chief Executive Officer of the Companyprior to 30 September 2006, and the options do not lapse for one of the reasonsset out in 1.3.3, the expiry date for each tranche will then be the date thatis six months after you cease to be Chief Executive Officer or such longerperiod as the Chairman may approve.

 

**1.4****                                        Superannuation**

 

You are entitled to superannuation in accordance with the member’s bookletfor the ANZ Australian Staff Superannuation Scheme.

 

**1.5****                                        Payments upon Termination of Employment**

 

•                                Youwill be entitled to the statutory entitlements of Long Service leave (paid onthe basis of notional salary) and Annual Leave (paid on the basis of notionalsalary plus cashtec).

 

•                                Inaddition to any payment in clause 12 of your employment agreement, thefollowing benefits will also apply on termination of your employment:

 

•                                ***On resignation (see clause 12.2)*,** you are:

•            not entitled to anyunvested deferred shares issued under the incentive arrangements unless agreedotherwise by the Board;

 

***On termination by notice or retirement,****(see clauses 12.3(a))*,you will be entitled to:

•            anydeferred shares issued to you under the ANZ incentive arrangements.

•            a Performance Bonuspro-rata to the date of termination;

 

•                                ***If******terminated by ANZ for serious misconduct, seriousneglect of duty or serious breach*** of any of the terms of youremployment agreement (see clause 12.3(b), you will only be entitled to the paymentsspecified in clause 12.3 (b) and all vested compensation as at the date ofdeparture.

 

•                                On***death*** or ***totalpermanent******disability***(see definition 1 below and clause 12.3(c)), you will be entitled to:

•    a Performance Bonuspro-rata to the date of termination; and

**•****           **any deferred shares issued to you under the ANZ incentivearrangements.

 

 

***Definitions***

 

***(d1)******                “total permanentdisability”*** for the purpose of thiscontract shall mean:

(a)                        in circumstances where you are a member of an ANZ superannuationfund, total permanent disability as determined by the trustee of that fund; or

(b)                       in circumstances where you are not a member of an ANZ superannuationfund, total permanent disability as determined by ANZ after assessment by amedical practitioner nominated by ANZ.

 

***(d2)******                “retirement”*** for the purposes of this agreement, shall mean circumstances whereyou choose to resign from ANZ and have no intention to be employed in afull-time remunerated capacity by another employer at any time in the future.

 

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I, JohnMcFarlane, have read, understood and agreed to the terms of employment outlinedin this employment agreement (including schedule).

 

 
| Name:             |    John  McFarlane |   |
|-------------------|-----------------------------------|--------|
|              |
|              |
| Signature:        |                              |   | Date: |   |   |
|              |
|              |
| /S/  J. McFarlane |                              |
| Dated:  24/10/01  |
|                   |                                   |        |  |  |  |  |

 

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