Document:

Exhibit
4.5

 

IMPERIAL
TOBACCO GROUP PLC

 

THE
IMPERIAL TOBACCO GROUP SHARESAVE SCHEME

(Adopted
by the Company on • and approved
by the Inland Revenue

on 3 December
1996

under reference
number SRS1827)

 

ASHURST
MORRIS CRISP

Broadwalk
House,

5
Appold Street,

LONDON
EC2A 2HA

 

Tel:
0171-638-1111

Fax:
0171-972-7990

 

 

THE
IMPERIAL TOBACCO GROUP SHARESAVE SCHEME

 

INDEX

 

	
  Clause

  	
  Description

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Commencement and Title

  	
   

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Grant
  of Options

  	
   

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Limitations on the
  issue of Shares

  	
   

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Exercise
  Price

  	
   

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Adjustment of Options

  	
   

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Exercise
  of Options

  	
   

  
	
   

  	
   

  	
   

  
	
  8.

  	
  Lapse
  of Options

  	
   

  
	
   

  	
   

  	
   

  
	
  9.

  	
  Takeover and Liquidation

  	
   

  
	
   

  	
   

  	
   

  
	
  10.

  	
  Allotment and Listing

  	
   

  
	
   

  	
   

  	
   

  
	
  11.

  	
  Employment
  Rights

  	
   

  
	
   

  	
   

  	
   

  
	
  12.

  	
  Administration of the
  Scheme

  	
   

  
	
   

  	
   

  	
   

  
	
  13.

  	
  Termination of the Scheme

  	
   

  

 

 

RULES
OF THE IMPERIAL TOBACCO GROUP SHARESAVE SCHEME

 

1.                                            Definitions

 

In
these Rules (unless the context otherwise requires) the following words and
expressions have the following meanings:-

 

	
  “Act”

  	
   

  	
  the Income
  Tax (Earnings and Pensions) Act 2003;

  
	
   

  	
   

  	
   

  
	
  “Adoption
  Date”

  	
   

  	
  the date on
  which the Scheme is adopted by the Company in general meeting;

  
	
   

  	
   

  	
   

  
	
  “Application
  Period”

  	
   

  	
  such period
  as the Board may determine but being a period not less than fourteen days and
  not more than 21 days from an Invitation Date;

  
	
   

  	
   

  	
   

  
	
  “Associated
  Company”

  	
   

  	
  has the same
  meaning given to it in paragraph 47 of Schedule 3 to the Act except for the
  purposes of Rule 7(f) where it has the meaning given to it by paragraph 35(4)
  of Schedule 3 to the Act;

  
	
   

  	
   

  	
   

  
	
  “Auditors”

  	
   

  	
  the auditors
  for the time being of the Company;

  
	
   

  	
   

  	
   

  
	
  “Board”

  	
   

  	
  the Board of
  Directors for the time being of the Company (or the directors present at a
  duly convened meeting of such Board) or a duly authorised committee thereof;

  
	
   

  	
   

  	
   

  
	
  “Bonus Date”

  	
   

  	
  where
  Repayment under the relevant Savings Contract is taken as including the
  maximum bonus, the earliest date on which the maximum bonus is payable and in
  any other case the earliest date on which a bonus is payable under the
  Savings Contract;

  
	
   

  	
   

  	
   

  
	
  “Commencement
  Date”

  	
   

  	
  the date on
  which the Scheme is approved by the Inland Revenue under the Income Tax and
  Corporation Taxes Act 1988;

  
	
   

  	
   

  	
   

  
	
  “Company”

  	
   

  	
  Imperial
  Tobacco Group PLC;

  

 

 

	
  “Continuous
  Service”

  	
   

  	
  service with any company which is or was a Subsidiary (including service
  with such company before it became a Subsidiary) which shall be aggregated
  with service with a Participating Company provided all such service has been
  continuous. In the case of an employee employed in employment by a
  Participating Company who is absent from such employment for any reason for a
  period during which such employee’s contract of service subsists, or by
  reason of maternity leave, and who then returns to such employment with a
  Participating Company then in calculating service any such period of absence
  shall be deemed to have formed part of his continuous service;

  
	
   

  	
   

  	
   

  
	
  “Control”

  	
   

  	
  has the same
  meaning as in Section 719 of the Act;

  
	
   

  	
   

  	
   

  
	
  “Date of
  Grant”

  	
   

  	
  the date on
  which the Grantor passes a resolution to grant an Option under Rule 3(D)
  below;

  
	
   

  	
   

  	
   

  
	
  “Eligible
  Employee”

  	
   

  	
  any employee
  (including a director holding a salaried employment or office) of a
  Participating Company who (a) on the relevant Date of Grant has achieved such
  period of Continuous Service not exceeding five years as the Board shall on
  or before the Invitation Date determine; (b) whose earnings from his office
  or employment are (or would be if there were any) general earnings to which
  section 15 to 21 of the Act applies; (c) who is not ineligible to participate
  in the Scheme by virtue of any of the provisions of the Act including in
  particular paragraph 11 of Schedule 3 to the Act; and (d) who in the case
  only of a director holding a salaried employment or office, usually works at
  least twenty-five hours per week excluding time off permitted for meal breaks
  provided that the Board may treat any employee or director of a member of the
  Group who meets requirement (c) above as an Eligible Employee PROVIDED
  HOWEVER THAT at the

  

 

 

	
   

  	
   

  	
  Invitation
  Date no notice of termination of such employment has been served by either
  the employee concerned or his employing Participating Company;

  
	
   

  	
   

  	
   

  
	
  “Exercise
  Price”

  	
   

  	
  the price
  per Share at which a Participant may acquire Shares pursuant to the Scheme
  (as determined in accordance with Rule 5);

  
	
   

  	
   

  	
   

  
	
  “Grantor”

  	
   

  	
  either the
  Board or the Trustee;

  
	
   

  	
   

  	
   

  
	
  “Group”

  	
   

  	
  the Company
  and its Subsidiaries from time to time together with any such company as the
  Board and the Inland Revenue shall have agreed may participate pursuant to
  the terms of Schedule 3, paragraph 46 of the Act;

  
	
   

  	
   

  	
   

  
	
  “Invitation
  Date”

  	
   

  	
  the date
  upon which invitations to apply for Options are issued by the Board, being a
  date within forty-two days after the Commencement Date and thereafter within
  twenty-eight days after the date of public announcement of the annual or half
  yearly results of the Group;

  
	
   

  	
   

  	
   

  
	
  “London
  Stock Exchange”

  	
   

  	
  London Stock
  Exchange Limited;

  
	
   

  	
   

  	
   

  
	
  “Option”

  	
   

  	
  a right
  granted pursuant to the Scheme to acquire Shares;

  
	
   

  	
   

  	
   

  
	
  “Participant”

  	
   

  	
  a person who
  holds a Subsisting Option or (where the context admits) his personal
  representatives;

  
	
   

  	
   

  	
   

  
	
  “Participating
  Company”

  	
   

  	
  any member
  of the Group which the Board has designated as a member of the Scheme for the
  time being;

  
	
   

  	
   

  	
   

  
	
  “Repayment”

  	
   

  	
  in relation
  to a Savings Contract, the amount of the contributions repayable and, where
  relevant, of any bonus and/or interest payable on the termination of the
  Savings Contract;

  

 

 

	
  “Savings
  Contract”

  	
   

  	
  a certified
  contractual savings scheme within the meaning of Section 326 (2), (3) or (4)
  of the Income and Corporation Taxes Act 1988 with a Building Society or an
  institution authorised under the Banking Act 1987 as determined by the Board
  and which has been approved by the Inland Revenue for the purposes of
  Schedule 3 to the Act;

  
	
   

  	
   

  	
   

  
	
  “Schedule 3”

  	
   

  	
  Schedule 3
  to the Act;

  
	
   

  	
   

  	
   

  
	
  “Scheme”

  	
   

  	
  the Imperial
  Tobacco Group Sharesave Scheme as amended from time to time;

  
	
   

  	
   

  	
   

  
	
  “Share”

  	
   

  	
  a fully paid
  ordinary share in the capital of the Company which satisfies paragraphs 18 to
  22 of Schedule 3;

  
	
   

  	
   

  	
   

  
	
  “Specified
  Age”

  	
   

  	
  60;

  
	
   

  	
   

  	
   

  
	
  “Subsidiary”

  	
   

  	
  a subsidiary
  of the Company as defined in Section 736 of the Companies Act 1985 over which
  the Company has Control;

  
	
   

  	
   

  	
   

  
	
  “Subsisting
  Option”

  	
   

  	
  an Option to
  the extent that it has neither lapsed nor been exercised;

  
	
   

  	
   

  	
   

  
	
  “Trustee”

  	
   

  	
  the trustee
  or trustees for the time being of any employee trust established by the
  Company wholly or partly for the benefit of all or most of the persons for
  the time being employed or holding office with the Group or any Participating
  Company or Companies which has been designated by the Board as a trust out of
  which Options may be granted.

  

 

Where the
context so permits the singular shall include the plural and vice versa and the
masculine gender shall include the feminine. 
Any reference to a statutory provision includes a reference to that
provision as for the time being amended or re-enacted.

 

 

2.                                            Commencement and Title

 

The Scheme
shall commence on the Commencement Date and shall be known as The Imperial
Tobacco Group Sharesave Scheme.

 

3.                                            Grant of Options

 

(A)          On or prior to an Invitation Date the
Grantor may decide in its absolute discretion:-

 

(i)                                        whether to invite
applications for the grant of Options; and

 

(ii)                                     whether to invite
applications for three year Options, five year Options or seven year Options
(or whether to offer Eligible Employees a choice).

 

(B)           Where applications for the grant of
Options are invited, such invitations shall be sent to all Eligible Employees
and shall state:-

 

(i)                                        the Exercise Price
or the method by which the Exercise Price for the Shares will be notified to
Eligible Employees;

 

(ii)                                     the date being the last day of the Application Period by which
applications for the grant of Options must have been received by the Board or
such person as the Board may direct being not less than 14 nor more than 21
days after the date of issue of such invitations except in exceptional
circumstances as determined by the Board; and

 

(iii)                                  whether application
may be made for three year Options, five year Options, seven year Options or
any combination of them.

 

PROVIDED THAT any accidental failure or omission to
deliver invitations to all Eligible Employees shall not invalidate the grant of
Options pursuant to this Rule 3(B) to which such invitations relate.

 

(C)           Applications for Options under the
Scheme shall be in such form as the Board may require and each:-

 

(i)                                        must be accompanied by a duly completed application form to enter
into one or more Savings Contracts under each of which the applicant will agree
to make in multiples of £5 per month such specified contributions being not
less than £5 per month nor (when aggregated with contributions made under any
other savings contract linked to a savings related share option scheme approved
under Schedule 3) more than £250 per month (or such

 

 

other
amounts as may from time to time be permitted under the Savings Contract) as
shall secure on the Bonus Date, as nearly as may be, Repayments of an amount
equal to that for which Shares may be acquired under his Option if exercised in
full; and

 

(ii)                                     shall empower the
Grantor or any person authorised by it:-

 

(a)                                  to amend the amount of the specified contribution referred to in
Rule 3(C)(i) above to such lesser sum as shall secure
on the Bonus Date, as nearly as may be, Repayments of an amount equal to that
for which Shares may be acquired by the Participant in the event that the
number of Shares for which an Eligible Employee applies for an Option has to be
reduced in accordance with Rule 3(D) below;

 

(b)                                 to deduct from the Participant’s pay such contribution as shall be
specified by the Participant pursuant to Rule 3(C)(i) or as may be amended
pursuant to Rule 3(C)(ii)(a) above and pay the same on behalf of the
Participant in discharge of the Participant’s obligations under the Savings
Contract.

 

(D)          Within thirty days or, in exceptional
circumstances, such longer period as may have been agreed previously in writing
with the Inland Revenue, of the date pursuant to Rule 5(A)(i) by reference to
which the Exercise Price was determined or in a case where the number of shares
over which Options are to be granted is determined by Rule 3(D) (ii) below,
within forty-two days of such date and subject to the limitations and
conditions contained in the Scheme, Options shall by resolution of the Grantor
be granted to the Eligible Employees who have applied for them in accordance
with the following provisions:-

 

(i)                                        Options shall be granted to the Eligible Employees in respect of all
the Shares applied for by them; save that

 

(ii)                                     where the Board in
its discretion considers that it is desirable to limit the number of Shares in
respect of which Options are granted in relation to any invitation, then the
following steps shall be carried out successively to the extent necessary to
eliminate the excess over the limitation imposed

 

(a)                                  the excess over £5
of the monthly savings contribution chosen by each applicant shall be reduced
pro rata to the extent necessary;

 

(b)                                 applications will
be selected by lot, each based on a monthly savings contributions of £5 and the
inclusion of no bonus in the Repayment under the Savings Contract.

 

 

(E)           No payment will be required from a
Participant on the grant of an Option. 
Each Participant will be issued with a certificate in the form from time
to time agreed with the Inland Revenue.

 

(F)           No Option shall be capable of being
transferred by a Participant.

 

(G)           No Option shall be granted more than
ten years after the Commencement Date.

 

(H)          The number of Shares over which an
Option is granted to any Eligible Employee must be so limited that the
aggregate of the Exercise Price for those Shares does not exceed the Repayment
under the Savings Contract entered into on the grant of such Option.

 

4.                                            Limitations on the
issue of Shares

 

Subject to
Rule 6 below, no Option shall be granted on any Date of Grant or proposed Date
of Grant if, as a result:-

 

(A)                                 the total number of Shares issued or committed to be issued during
the ten years preceding such Date of Grant under this Scheme and under all
other employee share schemes established by the Company would exceed 10% of the
issued ordinary share capital of the Company on that Date of Grant; or

 

(B)                                   the total number of Shares issued or committed to be issued during
the preceding five years under the Scheme and under all other employee share
schemes established by the Company would exceed 5% of the issued ordinary share
capital of the Company on that Date of Grant;

 

PROVIDED that,
for the avoidance of doubt, Shares which shall have been the subject of grants
which lapse shall not be taken into account for the purposes of this Rule 4.

 

5.                                            Exercise Price

 

(A) Subject to
Rule 6 below the Exercise Price shall be such amount as the Board shall
determine being an amount not less than the greater of:-

 

(i)                                        subject to Rule 5(B), eighty per cent. of the middle market
quotation per Share as derived from the Daily Official List of the London Stock
Exchange for the dealing day immediately preceding the Invitation Date; and

 

(ii)                                     in the case of an
Option to subscribe for Shares, the nominal value of a Share.

 

 

(B)           For the purposes of an Option granted
at any other time at which there shall be no dealings in the Shares, the
Exercise Price shall be not less than eighty per cent. of such sum as may be
agreed by the Inland Revenue in advance for the purposes of the Scheme to be
the market value of a Share in accordance with Part VIII of the Taxation of
Chargeable Gains Act 1992.

 

6.                                            Adjustment of Options

 

In the event
of any variation in the share capital of the Company whether by way of
capitalisation of profits or reserves or by way of rights or any consolidation
or sub-division or reduction of capital, or otherwise, then the number of Shares
subject to any Subsisting Option and the Exercise Price may be adjusted by the
Board in such manner and with effect from such date as the Board may determine
to be appropriate provided always that:-

 

(A)                                 any such adjustment
shall not take effect without the prior approval of the Board of Inland
Revenue;

 

(B)                                   no such adjustment
shall take effect until it has been referred to the Auditors and the Auditors
have certified in writing to the Board that the adjustment is fair and
reasonable in their opinion;

 

(C)                                   the Exercise Price
of an Option to subscribe for Shares shall not be adjusted below the nominal
value of a Share (unless the Company in general meeting shall resolve to pay up
any part of that nominal value out of distributable reserves).

 

7.                                            Exercise of Options

 

(A)          An Option shall be exercisable during
the period mentioned in Rule 7(C) below in respect of all or some of the Shares
over which it was granted by the Participant completing a written notice in the
prescribed form on the reverse of the certificate issued to the Participant
under Rule 3(E) specifying the number of Shares in respect of which the Option
is exercised together with a remittance for that number of Shares calculated by
reference to the Exercise Price. The date of exercise of the Option shall be
the date of receipt by the Company of such notice and payment.

 

(B)           It is a condition of the exercise of
an Option under the Scheme that payment for the Shares shall be made only with
monies not exceeding the amount of the Repayment to the Participant under the
Savings Contract to which he has contributed in relation to the Option.  If upon the exercise of an Option the
Repayment then due to a Participant under his Savings Contract is less than the
amount required to pay for all the Shares in respect of which it is purportedly
exercised, the Option shall be treated as exercised only in respect of such
number of Shares as may be acquired by the amount of the Repayment and shall
lapse as to the excess.

 

 

(C)           Save as otherwise provided, an Option
may not be exercised until the Bonus Date. 
Subject only to the provisions of Rule 7(G) below, no Option may be
exercised later than six months after the Bonus Date.

 

(D)          Notwithstanding any other provision
hereof no Option may be exercised at any time when the person seeking to
exercise it is excluded from participation in this Scheme by virtue of either
of paragraphs 10 and 11 of Schedule 3.

 

(E)          (i)            An
Option shall cease to be exercisable upon the Participant ceasing to be an
employee or director of any member of the Group (so as to hold no such
employment or office) except where his so ceasing is by reason of:-

 

(a)                                  his retirement on reaching the Specified Age or such other age at
which he is bound to retire in accordance with the terms of his employment; or

 

(b)                                 injury, disability or redundancy within the meaning of the
Employment Rights Act 1996 or his office or employment either being in a
company which ceases to be a Subsidiary or relating to a business or part of a
business which is transferred to a person who or which is neither a Subsidiary
nor a Participating Company; or

 

(c)                                  his leaving service at any time other than at a time specified in
Rule 7(E)(i)(a) or (b) above, provided that such event occurs not earlier than
three years from the Date of Grant of the Option;

 

in any of which circumstances the Option may be exercised at any time
during the period of six months from the date on which he so ceases to be an
employee or director of any member of the Group notwithstanding that the Bonus
Date shall not have occurred.

 

(ii)           If, at the Bonus Date, a Participant
holds an office or employment in a company which is not a Participating Company
but which is:-

 

(a)                                  an Associated
Company of the Company, or

 

(b)                                 a company of which
the Company has Control,

 

the Participant may exercise his Option within six months of that Bonus
Date.

 

(F)           For the purposes of Rule 7(E) above
and Rule 9 below (but for no other purpose):-

 

 

(i)                                        a Participant shall
not be regarded as ceasing to hold office or employment by reason of:-

 

(a)                                  his being or becoming employed by a company which ceases to be or is
not a Participating Company but is nevertheless an Associated Company or is
under the Control of the Company; or

 

(b)                                 his ceasing to be
employed full-time but continuing to be employed on a part-time basis; and

 

(ii)                                     a Participant shall be regarded as ceasing to hold office or
employment when he holds no employment with any of the Company, any Associated
Company and any company Controlled by the Company.

 

(G)           In the event of the death of a
Participant prior to the Bonus Date the Option may be exercised by his personal
representatives at any time during the period of twelve months commencing on
the date of his death (but not later) and the personal representatives shall be
entitled to do so notwithstanding that the Bonus Date has not occurred and in
the event of the death of a Participant within six months commencing on the
Bonus Date his personal representatives may exercise the Option at any time
within twelve months commencing on the Bonus Date PROVIDED THAT such personal
representatives shall not be entitled to exercise the Option if at the date of
the Participant’s death the Participant was precluded from exercising the
Option by reason of either of paragraphs 10 and 11 of Schedule 3.

 

(H)          A Participant who reaches the
Specified Age prior to the Bonus Date but continues to hold the office or
employment by virtue of which he is eligible to participate in the Scheme may
exercise the Option within six months after the date of his reaching the
Specified Age.

 

(I)            If an Option becomes exercisable
under any provision of the Scheme before the Bonus Date it shall be exercisable
only over the number of Shares the aggregate Exercise Price of which equals (as
nearly as may be) but does not exceed the Repayment made under the Savings
Contract entered into on the grant of that Option but excluding any
contributions made directly by the Participant except to the extent that such
are (i) made pursuant to any special arrangements relating to absence from
employment; or (ii) made at the same rate of contribution and at the same
intervals as those contributions previously deducted from his salary pursuant
to the provisions of Rule 3(C)(ii)(b) between the date of the Participant
ceasing to be employed by the Group and the date on which the Option is
exercised; and the Option shall cease to be exercisable over any Shares in
excess of that number in respect of which it was granted.  For the avoidance of doubt, any Repayment
under the Savings Contract shall exclude the Repayment of any contributions
made in advance under the

 

 

Savings
Contract the due date for payment of which falls or would have fallen more than
one month after the date on which Repayment is made.

 

(J)            An Option shall be exhausted and
automatically cancelled immediately after it is first exercised notwithstanding
that it shall not have been exercised in respect of all of the Shares over
which the Option was granted.

 

8.                                            Lapse of Options

 

A Participant’s
Option shall lapse and cease to be exercisable:-

 

(A)                                 upon the expiry of any of the periods for exercise under the
provisions of Rule 7 (with the exception of paragraph (H) thereof) above and
Rule 9 below, whichever shall first occur; or

 

(B)                                   if the Participant omits seven or more times to make a monthly
payment due under his Savings Contract or gives notice under the Savings
Contract requiring Repayment before the Bonus Date unless such non-payment or
notice is in consequence of his ceasing to be an Eligible Employee by virtue of
one of the causes mentioned in Rule 7 paragraphs (E) (G) or (H) above or in the
circumstances of Rule 9 below.

 

9.                                            Takeover and Liquidation

 

(A)          If any person obtains Control of the
Company as a result of making:-

 

(i)                                        a general offer to acquire the whole of the issued share capital of
the Company which is made on a condition such that if it is satisfied the
person making the offer will have Control of the Company; or

 

(ii)                                     a general offer to
acquire all the shares in the Company which are of the same class as the
Shares;

 

then any Subsisting Option may subject to paragraph (D) below be
exercised within six months of the time when the person making the offer has
obtained Control of the Company and any condition subject to which the offer is
made has been satisfied.

 

(B)           If under Section 425 of the Companies
Act 1985 the Court sanctions a compromise or arrangement proposed for the
purposes of or in connection with a Scheme for the reconstruction of the
Company or its amalgamation with any other company or companies, any Subsisting
Option may subject to paragraph (D) below be exercised within six months of the
Court sanctioning the compromise or arrangement.

 

 

(C)           If any person becomes bound or
entitled to acquire shares in the Company under Sections 428 to 430 of the
Companies Act 1985 any Subsisting Option may subject to paragraph (D) below be
exercised at any time when that person remains so bound or entitled.

 

(D)          If as a result of the events specified
in paragraphs (A) or (B) above a company has obtained Control of the Company,
or if a company has become bound or entitled as mentioned in paragraph (C)
above, any Participant may by agreement with that other company (the “Acquiring
Company”) within the Appropriate Period as defined in paragraph 38(3) of
Schedule 3 release any Subsisting Option of his in consideration of the grant
of a new Option (the “New Option”) which satisfies the following conditions:-

 

(i)                                        the New Option
shall be over shares in the Acquiring Company or another company which
satisfies paragraph (b) or (c) of Paragraph 18 of Schedule 3 in relation to the
Acquiring Company and shall satisfy the conditions specified in paragraphs 18
to 22 inclusive of Schedule 3;

 

(ii)                                     the New Option shall be a right to acquire such number of such
shares in the Acquiring Company (or such other company) as shall have on the
grant of the New Option an aggregate market value equal to the aggregate market
value of the Shares subject to the Option immediately before its release and
for this purpose market value shall be ascertained by the application of Rule
5(i) as at the date of release of the Option and grant of the New Option;

 

(iii)                                  the New Option
shall have an Exercise Price such that the aggregate price payable on complete
exercise equals the aggregate price which would have been payable on complete
exercise of the Option; and

 

(iv)                                 the New Option
shall be otherwise identical in terms to the Option

 

AND the
New Option shall, for all other purposes of this Scheme, be treated as having
been acquired at the same time as the Option in consideration of the release of
which it is granted.  With effect from
the release of any Option pursuant to this Rule 9, Rules 6, 7(A) and (B), this
Rule 9 and Rule 10 of this Scheme shall in relation to the New Option be
construed as if references therein to “the Company” were references to the
Acquiring Company or, as the case may be, such other company and all the Rules
(other than Rules 3 to 5 inclusive) shall in relation to the New Option be
construed as if references therein to Shares were references to shares in the
Acquiring Company or, as the case may be, such other company in respect of
whose shares the New Option is granted.

 

 

(E)           If the Company passes a resolution
for voluntary winding up, any Subsisting Option may be exercised within six
months of the passing of the resolution.

 

(F)           For the purposes of this Rule 9 other
than paragraph (D) above a person shall be deemed to have obtained Control of a
Company if he and others acting in concert with him have together obtained Control
of it.

 

(G)           The exercise of an Option pursuant to
the preceding provisions of this Rule 9 shall be subject to the provisions of
Rule 7 above.

 

(H)          Any Option shall lapse if:-

 

(i)                                        it shall not have been exercised by the expiry of any time limit for
exercise set out in this Rule 9, whichever shall expire first;  and

 

(ii)                                     no agreement for
the release of the Option shall have been entered into by the expiry of the
first Appropriate Period to commence pursuant to paragraph (D) above.

 

10.                                      Allotment and Listing

 

(A)          Subject to receipt of the appropriate
remittance:-

 

(i)                                        Shares to be issued pursuant to the exercise of an Option will be
allotted not later than thirty days after the exercise of the Option and will
rank pari passu in all respects with the Shares in issue on the date of
exercise save that they will not rank for any dividend or other distribution
paid or made by reference to the date (known as the record date) on which
entitlement to the dividend or distribution is fixed by reference to the Company’s
register of members if that date falls prior to the date of exercise of the
Option; and

 

(ii)                                     in the case of Shares to be transferred pursuant to the exercise of
an Option, the Grantor shall transfer or procure that the Shares shall be
transferred within 30 days after exercise of the Option, save that such Shares
will not rank for any dividend or other distribution paid or made by reference
to the date (known as the record date) on which entitlement to the dividend or
distribution is fixed by reference to the Company’s register of members if that
date falls prior to the date of exercise of the Option.

 

(B)           If the Shares are listed on the
London Stock Exchange at the date of allotment of any Shares pursuant to the
Scheme the Company will apply to the Council of the London Stock Exchange for
permission for such Shares so allotted to be admitted to the Official
List.  An application may be 

 

 

postponed at the discretion of the Board until application can be made in
respect of such number of Shares as the Board considers appropriate.

 

11.                                      Employment Rights

 

(A)          This Scheme shall not form part of any
contract of employment between any member of the Group and any employee of any
such company and the rights and obligations of any individual under the terms
of his office or employment with any member of the Group shall not be affected
by his participation in the Scheme or any right which he may have to
participate therein

 

(B)           Participation in the Scheme shall be
on the express condition that:-

 

(i)                                     neither it nor
cessation of participation shall afford any individual under the terms of his
office or employment with any member of the Group any additional or other
rights to compensation or damage; and

 

(ii)                                  no damages or compensation shall be payable in consequence of the
termination of such office or employment (whether or not in circumstances
giving rise to a claim for wrongful or unfair dismissal) or for any other
reason whatsoever to compensate him for the loss of any rights the Participant
would otherwise have had (actual or prospective) under the Scheme howsoever
arising but for such termination; and

 

(iii)                               the Participant
shall be deemed irrevocably to have waived any such rights to which he may
otherwise have been entitled

 

(C)                                   No individual shall have any claim against a member of the Group
arising out of his not being admitted to participation in the Scheme which (for
the avoidance of any doubt) is governed entirely by the Rules.

 

(D)                                  No Participant shall be entitled to claim compensation from any
member of the Group in respect of any sums paid by him pursuant to the Scheme
or for any diminution or extinction of his rights or benefits (actual or
otherwise) under any Option held by him consequent upon the lapse for any
reason of any Option held by him or otherwise in connection with the Scheme and
each member of the Group shall be entirely free to conduct its affairs as it
sees fit without regard to any consequences under, upon or in relation to the
Scheme or any Option or Participant

 

 

12.                                      Administration of the
Scheme

 

(A)          The Board may make and vary such
regulations (not being inconsistent with the Scheme) as it thinks fit for the
administration and implementation of the Scheme.  The Board’s decision on any matter concerning
the Scheme or its interpretation (other than a matter to be certified by the
auditors of the Company) shall be final and binding.

 

(B)           The Board shall be entitled by
resolution to amend all or any of the provisions of the Scheme as the Board
thinks fit except that no alteration shall be made:-

 

(i)                                        to the advantage of Participants without the prior sanction of an
ordinary resolution of the Company in general meeting except for minor
amendments to benefit the administration of the Scheme and amendments to obtain
and maintain favourable tax, exchange control or regulatory treatment for
Participants in the Scheme or for any member of the Group;

 

(ii)                                     to any rights
already accrued to any Participant which would be to the disadvantage of such
Participant, without the prior consent of such Participant; or

 

(iii)                                  in relation only to
Options to purchase Shares, without the prior consent of the Trustee;

 

unless, in any
such case, the alteration is necessary to comply with any legislation for the
time being in force or with any conditions requisite to obtain or to maintain
approval of the Inland Revenue for the Scheme AND provided that, at any time at
which the Scheme is and is intended to remain so approved by the Inland
Revenue, no amendment shall take effect unless and until such amendment shall have
been approved by the Inland Revenue.

 

(C)           Written notice of any alteration made
in accordance with Rule 12(B) shall be given to all Participants.

 

(D)          The Company shall keep available
sufficient issued and/or unissued Shares in the capital of the Company to
satisfy the exercise in full of all Options for the time being remaining
capable of being exercised.

 

(E)           Participants shall be sent copies of
any document having a material effect on their rights at the same time as such
document is sent to holders of Shares.

 

(F)           The provisions of the Company’s
Articles of Association for the time being in force with regard to the service
of notices upon members of the Company shall apply mutatis mutandis to any
notice to be given by the Company to Participants.  Any notice to be given by the Trustee to any

 

 

Participant or
Eligible Employee shall be sufficiently given if sent to his home address or
place of work as last reported in writing to the Trustee by the Company.

 

(G)           Notwithstanding anything to the
contrary contained herein the Board may at any time and from time to time by
resolution and without further formality amend the Scheme in any way to the
extent necessary to render the Scheme capable of approval by the Board of
Inland Revenue or any other governmental or other regulatory body pursuant to
any present or future United Kingdom legislation.

 

(H)          The Scheme shall be governed by
English law.

 

13.                                      Termination of the Scheme

 

The
Scheme may be terminated at any time by the Board or by the Company in general
meeting but in any event shall terminate on the tenth anniversary of the
Commencement Date and on such termination no further Options shall be granted,
but the subsisting rights of Participants shall not be affected by such
termination.

 

 

Imperial
Tobacco Group PLC

SHARESAVE
SCHEME

 

OPTION CERTIFICATE

 

Name of Option
Holder                                                                                       

 

Address of
Option Holder                                                                                       

 

                                                                                                                

 

                                                                                                                

 

                                 Post
Code                                                               

 

Option
Certificate number                                                                                      

 

Number of
shares granted under this option                                                           

 

Date of grant                                                                                      

 

This is to
certify that the above named person was on the above date granted an option as
specified for ordinary shares of [  ]p each in the capital of Imperial Tobacco Group PLC at an
exercise price of [     ]p per share upon
and subject to the terms of the Imperial Tobacco Group PLC Sharesave Scheme
adopted by a resolution of Imperial Tobacco Group PLC in general meeting on

 

[                  ].

 

Signed on
behalf of

 

                                    Director                                     
Secretary

 

	
  NOTES:

  	
   

  	
  (1)

  	
   

  	
  The option
  cannot be assigned or transferred.

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (2)

  	
   

  	
  In order to
  exercise your option please complete the Form of Exercise printed overleaf
  and send it together with a request for a cheque for
  the relevant exercise price of the shares and evidence of the amount repaid
  under your Sharesave contract to the Nationwide Building Society (or such
  other person as shall have been notified to you).

  

 

THIS DOCUMENT MUST BE
RETAINED.  PLEASE KEEP IT IN A SAFE PLACE.  This certificate is issued
as a matter of record only and is not a document of title.

 

 

Imperial
Tobacco Group PLC

 

SHARESAVE
SCHEME

FORM OF EXERCISE OF
OPTION

 

	
  To:

  	
   

  	
  The Company
  Secretary

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Imperial Tobacco Group PLC

  

 

(In order to
exercise your option you should complete, sign and return this document to the
Nationwide Building Society (or such other person as shall have been notified
to you))

 

1.             I wish to exercise the option
referred to on the reverse Option Certificate in respect of [           ] ordinary shares.  (Insert the number of shares in respect of
which the option is exercised.  If you do
not wish to exercise the option for all the shares shown on the attached
certificate you may exercise options for a lesser number.)

 

2.             I enclose a cheque for £            in favour of Imperial Tobacco Group
PLC/Trustee being the total exercise price payable under this option for the
above specified number of ordinary shares together with evidence of the amount
repaid to me under my SAYE.

 

Personal
Details

 

SURNAME                                       
MR/MRS/MISS/MS                                       

 

FIRST NAMES                                                                                                

 

HOME ADDRESS                                                                                          

 

                                        POST
CODE                                                  

 

SIGNATURE                                 DATE                                                       

 

NOTE:                                                       This option may be exercised only by the person to whom it was
granted or their personal representative(s).

 

IF YOU ARE IN ANY DOUBT,
PLEASE CONTACT YOUR/THE SCHEME ADMINISTRATORExhibit 4.6

 

IMPERIAL TOBACCO GROUP PLC

 

 

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN

 

 

ASHURST

Broadwalk House,

5 Appold Street,

LONDON EC2A 2HA

 

Tel: 
020 7638 1111

Fax: 
020 7638 1112

 

 

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN

 

CONTENTS

 

	
  CLAUSE

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
  Definitions

  	
   

  
	
  2.

  	
  Commencement and Title

  	
   

  
	
  3.

  	
  Grant
  of Option

  	
   

  
	
  4.

  	
  Limitations on the
  issue of Shares

  	
   

  
	
  5.

  	
  Exercise
  Price

  	
   

  
	
  6.

  	
  Alterations of Share
  Capital

  	
   

  
	
  7.

  	
  Exercise
  of Options

  	
   

  
	
  8.

  	
  Lapse of
  Option

  	
   

  
	
  9.

  	
  Takeover and Liquidation

  	
   

  
	
  10.

  	
  Allotment
  and Listing

  	
   

  
	
  11.

  	
  Employment
  Rights

  	
   

  
	
  12.

  	
  Administration of the Plan

  	
   

  
	
  13.

  	
  Termination of the Plan

  	
   

  
	
  14.

  	
  General

  	
   

  
	
   

  	
   

  
	
  SCHEDULE 1

  	
   

  
	
  APPENDIX 1

  	
   

  
	
  APPENDIX 2

  	
   

  
	
  APPENDIX 3

  	
   

  
	
  APPENDIX 4

  	
   

  
	
  APPENDIX 5

  	
   

  
	
  APPENDIX 6

  	
   

  
	
  APPENDIX 7

  	
   

  
	
  APPENDIX 8

  	
   

  
	
  APPENDIX 9

  	
   

  
	
  APPENDIX 10

  	
   

  
	
  APPENDIX 11

  	
   

  
	
  APPENDIX 12

  	
   

  
	
   

  	
   

  
	
  SCHEDULE 2

  	
   

  
	
  APPENDIX
  1

  	
   

  

 

 

1.                                                Definitions

 

In this Plan
(unless the context otherwise requires) the following words and expressions
have the following meanings:-

 

	
  “Act”

  	
  the United Kingdom Income and Corporation
  Taxes Act 1988 and any statutory re-enactment or modification thereof;

  
	
   

  	
   

  
	
  “Adoption Date”

  	
  the date on which the Plan is adopted by
  the Company in general meeting;

  
	
   

  	
   

  
	
  “ADS”

  	
  American Depositary Shares, each
  representing two Shares, evidenced by American Depositary Receipts, which may
  be issued by Citibank, N.A., as depositary (“the Depositary”) pursuant to the
  Amended and Restated Deposit Agreement, dated as of November 2, 1998,
  among the Company, the Depositary and all holders and beneficial owners of
  American Depositary Shares thereunder;

  
	
   

  	
   

  
	
  “Application Period”

  	
  such period as the Board may determine
  but being a period not more than 28 days from an Invitation Date;

  
	
   

  	
   

  
	
  “Associated Company”

  	
  means any company Controlling or under
  the Control of the Company or which is Controlled by the same person or
  persons as Control the Company;

  
	
   

  	
   

  
	
  “Auditors”

  	
  the auditors for the time being of the
  Company;

  
	
   

  	
   

  
	
  “Board”

  	
  the Board of Directors for the time being
  of the Company (or the directors present at a duly convened meeting of such
  Board) or a duly authorised committee thereof;

  
	
   

  	
   

  
	
  “Commencement Date”

  	
  subject to the approval of the Plan by
  shareholders in general meeting such date as the Board shall, in its
  discretion, determine;

  
	
   

  	
   

  
	
  “Companies Act 1985”

  	
  the Companies Act 1985 of England and
  Wales;

  
	
   

  	
   

  
	
  “Company”

  	
  Imperial Tobacco Group PLC;

  
	
   

  	
   

  
	
  “Continuous Service”

  	
  service with any company which is or was
  a Subsidiary (including, if the Board shall so determine in any case to which
  it is relevant, service with such company before it became a Subsidiary)
  which shall be aggregated with service with a Participating Company provided
  all such 

  

 

1

 

	 
	
   

  	
  service has been continuous. In the case
  of an employee employed in full-time employment by a Participating Company
  who is absent from such employment for any reason for a period during which
  such employee’s contract of service subsists, or by reason of maternity
  leave, and who then returns to such full-time employment with a Participating
  Company then in calculating service any such period of absence shall be
  deemed to have formed part of his continuous service;

  
	 
	
   

  	
   

  
	
  “Control”

  	
  the power of a person to secure:-

  
	
   

  	
   

  
	
   

  	
  (a)                                  by
  the holding of shares or possession of voting power in or in relation to any
  company; or

  
	
   

  	
   

  
	
   

  	
  (b)                                 by
  virtue of any powers conferred by the articles of association or other
  document regulating any company,

  
	
   

  	
   

  
	
   

  	
  that the affairs of any company are
  conducted in accordance with the wishes of that person;

  
	
   

  	
   

  
	
  “Date of Grant”

  	
  the date on which the Grantor passes a
  resolution to grant an Option under Rule 3(D) below;

  
	
   

  	
   

  
	
  “Eligible Employee”

  	
  any employee (including a director
  holding a salaried employment or office) of a Participating Company who (a)
  on the relevant Date of Grant has achieved such period of Continuous Service
  not exceeding five years as the Board shall in each case on or before the
  Invitation Date determine and (b) in the case only of a director holding a
  salaried employment or office, usually works at least twenty-five hours per
  week excluding time off permitted for meal breaks provided that the Board may
  also treat any other employee or director of a Participating Company who
  fails to fulfil the relevant criteria as an Eligible Employee PROVIDED
  HOWEVER THAT at the Invitation Date no notice of termination of such
  employment has been served by either the employee concerned or his employing
  Participating Company;

  
	
   

  	
   

  
	
  “Exercise Price”

  	
  the price per Share at which a
  Participant may acquire Shares pursuant to the Plan (as determined in
  accordance with Rule 5);

  
	
   

  	
   

  
	
  “Grantor”

  	
  either the Board or the Trustee;

  
			

 

2

 

	
  “Group”

  	
  the Company and its Subsidiaries from
  time to time;

  
	
   

  	
   

  
	
  “Imperial Tobacco Group Sharesave Scheme”

  	
  The Imperial Tobacco Group Sharesave
  Scheme adopted on 14 August 1996, as amended from time to time;

  
	
   

  	
   

  
	
  “Invitation Date”

  	
  the date upon which invitations to apply
  for Options are issued by the Board, being a date within forty two days after
  the Commencement Date and thereafter within twenty-eight days after the date
  of public announcement of the annual or half yearly results of the Group;

  
	
   

  	
   

  
	
  “London Stock Exchange”

  	
  the London Stock Exchange Limited.

  
	
   

  	
   

  
	
  “Normal Repayment Date”

  	
  means in relation to any Participant the
  first day of the month following the date on which the Participant makes, or
  should have made, the final specified contribution (as defined in Rule 3(C))
  to the Savings Plan and for this purpose the starting date of the Savings
  Plan shall be the first day of the month following that in which the first
  such specified contribution is made to the Savings Plan;

  
	
   

  	
   

  
	
  “Option”

  	
  a right to acquire Shares, or ADSs,
  granted pursuant to the Plan;

  
	
   

  	
   

  
	
  “Participant”

  	
  a person who holds a Subsisting Option or
  (where the context admits) his personal representatives;

  
	
   

  	
   

  
	
  “Participating Company”

  	
  any member of the Group which the Board
  has designated as such for the time being;

  
	
   

  	
   

  
	
  “Plan”

  	
  The Imperial Tobacco Group International
  Sharesave Plan as amended from time to time;

  
	
   

  	
   

  
	
  “Relevant Multiple”

  	
  such number of monthly contributions to a
  Savings Plan as the Board may, in its discretion, invite Eligible Employees
  to make in connection with the grant of an Option under the Plan, and, where
  the context admits or requires, the number of such contributions to which a
  particular Participant shall have committed himself;

  
	
   

  	
   

  
	
  “Repayment”

  	
  in relation to a Savings Plan, the amount
  of the contributions repayable and, where relevant, of any bonus and/or
  interest payable under the Savings Plan;

  

 

3

 

	
  “Savings Plan”

  	
  means any savings plan or arrangement
  which has been approved by the Board in its absolute discretion for the
  purposes of the Plan;

  
	
   

  	
   

  
	
  “Schedule 9”

  	
  Schedule 9 to the Act;

  
	
   

  	
   

  
	
  “Share”

  	
  a fully paid ordinary share in the
  capital of the Company;

  
	
   

  	
   

  
	
  “Specified Age”

  	
  60;

  
	
   

  	
   

  
	
  “Subsidiary”

  	
  means any company in relation to which
  the Company:-

  
	
   

  	
   

  
	
   

  	
  (a)                                  holds a majority of the voting rights; or

  
	
   

  	
   

  
	
   

  	
  (b)                                 is
  a member and has the right to appoint or remove a majority of its board of
  directors; or

  
	
   

  	
   

  
	
   

  	
  (c)                                  is
  a member and controls alone, pursuant to an agreement with other shareholders
  or members, a majority of the voting rights in it;

  
	
   

  	
   

  
	
   

  	
  and includes any other company which is a
  subsidiary as defined above of a company which is itself a subsidiary of the
  Company;

  
	
   

  	
   

  
	
  “Subsisting Option”

  	
  an Option to the extent that it has
  neither lapsed nor been exercised;

  
	
   

  	
   

  
	
  “Trustee”

  	
  the trustee or trustees for the time
  being of any employee trust established by the Company wholly or partly for
  the benefit of all or most of the persons for the time being employed by or
  holding office with the Group or any Participating Company or Companies which
  has been designated by the Board as a trust out of which Options may be
  granted.

  

 

Where the context so permits the singular
shall include the plural and vice versa and the masculine gender shall include
the feminine.  Any reference to a
statutory provision includes a reference to that provision as for the time
being amended or re-enacted.

 

2.                                                Commencement and Title

 

The Plan shall
commence on the Commencement Date and shall be known as The Imperial Tobacco
Group International Sharesave Plan.

 

4

 

3.                                                Grant of Option

 

(A)                    On or prior to an
Invitation Date the Board in its absolute discretion may decide to invite
applications for the grant of Options.

 

(B)                      Where applications
are invited, the Board shall determine whether or not invitations shall be sent
to all Eligible Employees (and, for the avoidance of doubt, the Board may send
invitations to Eligible Employees of Participating Companies in one
jurisdiction but not to Eligible Employees of Participating Companies in other
jurisdictions) and any such invitations must state:-

 

(i)                                              the Exercise Price or the method by which the Exercise Price for the
Shares will be notified to Eligible Employees; and,

 

(ii)                                           the date being the last day of the Application Period by which
applications for the grant of Options must have been received by the Board or
such person as the Board may direct being not more than twenty eight days after
the date of issue of such invitations; and,

 

(iii)                                        the Relevant Multiple or Multiples.

 

(C)                      Applications for
Options under the Plan shall be in such form as the Board may require and
each:-

 

(i)                                              must be accompanied by a duly completed application form to enter
into a Savings Plan under which the applicant will agree to make the Relevant
Multiple of such specified contributions being not less than £10 per month nor
(when aggregated with contributions made under any other subsisting Savings
Plan and/or under any other savings contract linked to the Imperial Tobacco
Group Sharesave Scheme) more than £250 per month, or the equivalent sums at the
Invitation Date in the currency of their country of employment (or such other
amounts or currency or currencies as may from time to time be permitted by the
Board under the Savings Plan) as shall be estimated (on the basis of such rate
of exchange as the Board shall designate on or before the Invitation Date) to
secure on the Normal Repayment Date, as nearly as may be, Repayments of an
amount equal to that for which Shares may be acquired under his Option if
exercised in full; and

 

(ii)                                           shall empower the Board or any person authorised by it:-

 

(a)          to amend the amount of the
specified contribution referred to in Rule 3(C)(i) above to such lesser sum as
shall secure on the Normal Repayment Date, as nearly as may be, Repayments of
an amount equal to that for which Shares may be acquired by the Participant in
the event that the number of Shares for which an Eligible Employee applies for
an Option has to be reduced in accordance with Rule 3(D) below;

 

5

 

(b)         to deduct from the
Participant’s pay such contribution as shall be specified by the Participant
pursuant to Rule 3(C)(i) above or as may be amended pursuant to Rule
3(C)(ii)(a) above and pay the same on behalf of the Participant in discharge of
the Participant’s obligations under the Savings Plan.

 

(D)                     Within forty-two
days of the date pursuant to Rule 5(A)(i) below by reference to which the
Exercise Price was determined or in a case where the number of Shares over
which an Option is to be granted is determined by Rule 3(D) (ii) below, within
forty-nine days of such date and subject to the limitations and conditions
contained in the Plan, Options shall by resolution of the Grantor be granted to
each Eligible Employee who has made a valid application in accordance with the
following:-

 

(i)                                              Options shall be granted to the Eligible Employee in respect of that
number of Shares as would have an aggregate Exercise Price not exceeding the
Relevant Multiple of the sterling equivalent of the Eligible Employee’s
proposed monthly contributions to the Savings Plan as at the Invitation Date;
save that

 

(ii)                                           the Board may (but shall not be obliged to) make such adjustments to
the number of Shares placed under an Option as it may in its absolute
discretion determine to be appropriate taking into account the actual and
anticipated rate of interest applicable to the Eligible Employee’s Savings Plan
contributions and the actual and anticipated rate of exchange between the
savings currency and sterling (if savings are expected to be retained in a
currency other than sterling) over the period of the savings contract and such
other factor or factors, if any, as the Board may consider to be relevant; and

 

(iii)                                        where the Board in its discretion considers that it is desirable to
limit the number of Shares in respect of which Options are granted in relation
to any invitation the monthly savings contribution chosen by each applicant
under the Savings Plan shall be reduced in such manner as the Board may, in its
discretion, determine (provided that all Eligible Employees shall be treated on
a similar basis without regard to differences among Eligible Employees in
respect of remuneration, length of service or any other factor) to the extent
necessary so as to reduce the aggregate number of Shares applied for to or as
near to as shall be practicable without exceeding the said limitation.

 

(E)                       No payment will
be required from a Participant on the grant of an Option.  Each Participant will be issued with a
certificate in the form from time to time determined by the Board.

 

(F)                       No Option shall
be capable of being transferred by a Participant.

 

(G)                      No Option shall
be granted more than ten years after the Commencement Date.

 

6

 

(H)                     The reference in
Rule 3(D)(i) above to the sterling equivalent of any amount means the sterling
equivalent determined by the Board by reference to such published rate of
exchange between sterling and the relevant currency as may be available to the
Board on or about the Invitation Date and which the Board determines in its
discretion to be appropriate.

 

(I)                          The Board
may (but shall not be obliged to) invite those Participants whose contributions
to a Savings Plan are made in a particular currency to adjust the rate at which
they contribute to the Savings Plan at any time and from time to time during
the life of that Savings Plan if the Board considers that it may be in the
interests of those Participants to do so in the light of relative rates of
exchange, interest rates or any other factor. 
No Participant shall be obliged to adjust the rate of contribution
should the opportunity to do so be offered.

 

(J)                         Where an
Eligible Employee does not receive an application for Options and/or any other
information connected with any such application as a result of an accidental
act or omission on the part of the Board or any person authorised by it in
relation to the issue and/or distribution of such documents, that shall not
affect the validity of any other matters pertaining to the Plan.

 

4.                                                Limitations
on the issue of Shares

 

Subject to
Rule 6 below, no Option shall be granted on any Date of Grant or proposed Date
of Grant if, as a result:-

 

(i)                           the
aggregate number of Shares (including Shares represented by ADSs) issued or
committed to be issued during the ten years preceding such Date of Grant under
the Plan and all other share schemes (including non-approved, savings related
and profit sharing Plans) established by the Company would exceed 10% of the
issued ordinary share capital of the Company on that Date of Grant; or

 

(ii)                        the aggregate
number of Shares (including Shares represented by ADSs) issued or committed to
be issued during the preceding five years under the Plan and all other schemes
mentioned in paragraph (i) above would exceed 5% of the issued ordinary share
capital of the Company on that Date of Grant;

 

PROVIDED that,
for the avoidance of doubt, Shares (including Shares represented by ADSs) which
shall have been the subject of grants which lapse shall not be taken into
account for the purposes of this Rule 4.

 

5.                                                Exercise Price

 

(A)                    Subject to Rule 6
below the Exercise Price shall be such amount expressed in sterling (or in such
other currency or currencies as the Board shall specify) in the case of Options
for Shares as the Board shall determine being an amount not less than the
greater of:-

 

7

 

(ii)                        subject to
Rule 5(B) below eighty per cent of the middle market quotation per Share as
derived from the Daily Official List of the London Stock Exchange for the
dealing day immediately preceding the Invitation Date; and

 

(iii)                     in the case only
of an Option to subscribe for Shares, the nominal value of a Share.

 

(B)                      For the purposes
of an Option granted at any time at which there shall be no dealings in the
Shares, the Exercise Price shall be not less than eighty per cent of such sum
as may be determined by the Board to be the market value of a Share at that
time.

 

(C)                      For the
avoidance of doubt, the Board may set a different Exercise Price for Eligible
Employees of Participating Companies in one jurisdiction from those of another
jurisdiction notwithstanding that invitations may be sent out to all such Eligible
Employees on the same Invitation Date, but any such Exercise Price must fulfil
the requirements of Rule 5(A) above.

 

6.                                                Alterations of
Share Capital

 

In the event
of:

 

(a)                        any variation
in the share capital of the Company whether by way of capitalisation of profits
or reserves or by way of rights or any consolidation or sub-division or
reduction of capital, or otherwise;

 

(b)                       the Company
paying a capital dividend;

 

(c)                        a demerger of
any company within, or business owned by, the Group; or

 

(d)                       in any other
circumstances similarly affecting Options granted under the Plan;

 

then the
number of Shares subject to any Subsisting Option and the Exercise Price may be
adjusted by the Board in such manner and with effect from such date as the
Board may determine to be appropriate provided always that:-

 

(i)                           no such
adjustment shall take effect until it has been referred to the Auditors and the
Auditors have certified in writing to the Board that the adjustment is, in
their opinion, fair and reasonable; and

 

(ii)                        the Exercise
Price of an Option to subscribe for Shares shall not be adjusted below the
nominal value of a Share (unless the Company in general meeting shall resolve
to pay up any part of that nominal value out of distributable reserves).

 

7.                                                Exercise of Options

 

(A)                    The extent to
which an Option may be exercised shall be:-

 

(i)                           where
exercise takes place on or after the Normal Repayment Date related to the
Option, in full; and,

 

8

 

(ii)                        where exercise
takes place earlier than the Normal Repayment Date related to the Option (the “Early
Exercise Date”), in that proportion which the number of specified contributions
which shall have been made on or before such Early Exercise Date bears to the
Relevant Multiple.

 

(B)                      An Option shall
be exercisable during the period mentioned in Rule 7(D) below in respect of all
or some of the Shares over which it was granted by the Participant delivering
to the Secretary of the Company at its registered office (or otherwise as may be
notified to Participants from time to time) a written notice in the prescribed
form specifying the number of Shares in respect of which the Option is
exercised together with a remittance for that number of Shares calculated by
reference to the Exercise Price.

 

The date of
exercise of the Option shall be the date of receipt by the Company of such
notice and payment.

 

(C)                      It is a
condition of the exercise of an Option under the Plan that the Participant
shall withdraw all sums due by way of Repayment under the Savings Plan to which
he has contributed in relation to the Option. 
If upon the exercise of an Option the Repayment then due to a
Participant under his Savings Plan is less than the amount required to pay for
all the Shares in respect of which it may be exercised pursuant to Rule 7(A)
above the Participant may add to the Repayment up to a maximum of such sum as
shall be necessary to pay for all such Shares. 
If the Repayment shall exceed the amount required to exercise the Option
to the extent possible (or to the extent to which it is in fact exercised, if
lower) such excess shall be paid to the Participant.

 

(D)                     Save as otherwise
provided, an Option may not be exercised until the Normal Repayment Date.  Subject only to the provisions of Rule 7(G)
below, no Option may be exercised later than six months after the Normal
Repayment Date.

 

(E)                       An Option shall
cease to be exercisable upon the Participant ceasing to be an employee or
director of any member of the Group (so as to hold no such employment or office)
except where his so ceasing is by reason of:-

 

(i)                                             his retirement on reaching the Specified Age or such other age at
which he is bound to retire in accordance with the terms of his employment; or

 

(ii)                                          injury, disability or redundancy or his office or employment either
being in a company which ceases to be a Subsidiary or relating to a business or
part of a business which is transferred to a person who or which is neither a
Subsidiary nor a Group company; or

 

(iii)                                       his leaving service at any time other than at a time specified in
sub-paragraph (i) or (ii) above, provided that such event occurs not earlier
than three years from the Date of Grant of the Option;

 

9

 

in any of
which circumstances the Option may be exercised at any time during the period
of six months from the date on which he so ceases to be an employee or director
of any member of the Group notwithstanding that the Normal Repayment Date shall
not have occurred.

 

(F)                       For the
purposes of Rule 7(E) above and Rule 9 below (but for no other purpose):-

 

(i)                                             a Participant shall not be regarded as having ceased to hold office
or employment by reason of:-

 

(a)          his being or becoming
employed by a company which ceases to be or is not a Participating Company but
is nevertheless an Associated Company or is under the Control of the Company;
or

 

(b)         his ceasing to be employed
full-time but continuing to be employed on a part-time basis; and

 

(ii)                                          a Participant shall be regarded as ceasing to hold office or employment
when he holds no employment with any of the Company, any Associated Company and
any company Controlled by the Company.

 

(G)                      In the event of
the death of a Participant prior to the Normal Repayment Date the Option may be
exercised by his personal representatives at any time during the period of
twelve months commencing on the date of his death (but not later) and the
personal representatives shall be entitled to do so notwithstanding that the
Normal Repayment Date has not occurred and in the event of the death of a
Participant within six months commencing on the Normal Repayment Date his
personal representatives may exercise the Option at any time within twelve
months commencing on the Normal Repayment Date.

 

(H)                     A Participant who
reaches the Specified Age prior to the Normal Repayment Date but continues to
hold the office or employment by virtue of which he is eligible to participate
in the Plan may exercise the Option within six months after the date of his
reaching the Specified Age.

 

(I)                          If an Option
becomes exercisable under any provision of the Plan before the Normal Repayment
Date it shall be exercisable only to the extent permitted by Rules 7(A) and (C)
above.  The Repayment made under the
Savings Plan entered into on the grant of an Option shall exclude any
contributions made direct by the Participant except to the extent that such are
made pursuant to any special arrangements relating to absence from
employment.  For the avoidance of doubt,
any Repayment under the Savings Plan shall exclude the Repayment of any
contributions made in advance under the Savings Plan the due date for payment
of which falls or would have fallen more than one month after the date on which
Repayment is made.

 

10

 

(J)                         An Option
shall be exhausted and automatically cancelled immediately after it is first
exercised notwithstanding that it shall not have been exercised in respect of
all of the Shares over which the Option was granted.

 

8.                                                Lapse of Option

 

A Participant’s
Option shall lapse and cease to be exercisable:-

 

(A)                    upon the expiry of
any of the periods for exercise under the provisions of Rule 7 above and Rule 9
below, whichever shall first occur; or

 

(B)                      if the
Participant omits seven or more times to make a monthly payment due under his
Savings Plan or gives notice under the Savings Plan requiring Repayment before
the Normal Repayment Date unless such non-payment or notice is in consequence
of his ceasing to be an Eligible Employee by virtue of one of the causes mentioned
in Rules 7(E) or (G) above or in the circumstances of Rules 7 (H) above or Rule
9 below .

 

9.                                                Takeover and
Liquidation

 

(A)                    If any person
obtains Control of the Company as a result of making:-

 

(i)                           a general
offer to acquire the whole of the issued share capital of the Company (not
otherwise held or contracted to be acquired by the offeror) which is made on a
condition such that if it is satisfied the person making the offer will have
Control of the Company; or

 

(ii)                        a general
offer to acquire all the shares in the Company which are of the same class as
the Shares (including the Shares represented by ADSs);

 

then any
Subsisting Option may be exercised within six months of the time when the
person making the offer has obtained Control of the Company and any condition
subject to which the offer is made has been satisfied.

 

(B)                      If under Section 425
of the Companies Act 1985 the Court sanctions a compromise or arrangement
proposed for the purposes of or in connection with a Plan for the
reconstruction of the Company or its amalgamation with any other company or
companies, any Subsisting Option may be exercised within six months of the
Court sanctioning the compromise or arrangement.

 

(C)                      If any person
becomes bound or entitled to acquire shares in the Company under Sections 428
to 430 of the Companies Act 1985 any Subsisting Option may be exercised at any
time when that person remains so bound or entitled.

 

(D)                     If as a result of
the events specified in Rules 9(A) or (B) above a company has obtained Control
of the Company, or if a company has become bound or entitled as mentioned in
Rule 9(C) above, any Participant may by agreement with that other company (the “Acquiring
Company”) within the Appropriate Period as defined in

 

11

 

paragraph 15(2) of Schedule 9 release
any Subsisting Option of his in consideration of the grant of a new Option (the
“New Option”) which satisfies the following conditions:-

 

(i)                           the New
Option shall be over shares in the Acquiring Company or another company which
satisfies paragraph (b) or (c) of Paragraph 10 of Schedule 9 in relation
to the Acquiring Company and shall satisfy the conditions specified in
paragraphs 10 to 14 inclusive of Schedule 9;

 

(ii)                                                the New Option shall be a right to acquire such number of such
shares in the Acquiring Company (or such other company) as shall have on the
grant of the New Option an aggregate market value equal to the aggregate market
value of the Shares subject to the Option immediately before its release and
for this purpose market value shall be ascertained by the application of Rule
5(A)(i) above as at the date of release of the Option and grant of the New
Option;

 

(iii)                                             the New Option shall have an Exercise Price such that the aggregate
price payable on complete exercise equals the aggregate price which would have
been payable on complete exercise of the Option; and

 

(iv)                                            the New Option shall be otherwise identical in terms to the Option

 

AND the New
Option shall, for all other purposes of this Plan, be treated as having been
acquired at the same time as the Option in consideration of the release of
which it is granted.  With effect from
the release of any Option pursuant to Rules 6, 7(A), (B) and (C), this Rule 9 and
Rule 10 of this Scheme shall in relation to the New Option be construed as if
references therein to “the Company” were references to the Acquiring Company
or, as the case may be, such other company and all the Rules (other than Rules
3 to 5 inclusive) shall in relation to the New Option be construed as if
references therein to Shares were references to shares in the Acquiring Company
or, as the case may be, such other company in respect of whose shares the New
Option is granted.

 

(E)                       If the Company
passes a resolution for voluntary winding up, any Subsisting Option may be
exercised within six months of the passing of the resolution.

 

(F)                       For the
purposes of this Rule 9 a person shall be deemed to have obtained Control of a
Company if he and others acting in concert with him have together obtained
Control of it.

 

(G)                      The exercise of
an Option pursuant to the preceding provisions of this Rule 9 shall be subject
to the provisions of Rule 7 above.

 

(H)                     Any Option shall
lapse if:-

 

(i)                           it shall
not have been exercised by the expiry of any time limit for exercise set out in
this Rule 9, whichever shall expire first; and

 

12

 

(ii)                        no agreement
for the release of the Option shall have been entered into by the expiry of the
first Appropriate Period to commence pursuant to Rule 9(D) above.

 

10.                                          Allotment and
Listing

 

(A)                    Subject to receipt
of the appropriate remittance, Shares to be acquired pursuant to the exercise
of an Option will be allotted or transferred not later than forty-five (45)
days after the exercise of the Option and will rank pari passu in all respects
with the Shares in issue on the date of exercise save that they will not rank
for any dividend or other distribution paid or made by reference to the date
(known as the record date) on which entitlement to the dividend or distribution
is fixed by reference to the Company’s register of members if that date falls
prior to the date of exercise of the Option.

 

(B)                      If the Shares
are listed on the London Stock Exchange at the date of allotment of any Shares
pursuant to the Plan the Company will apply to the London Stock Exchange for
permission for such Shares so allotted to be admitted to the Official
List.  An application may be postponed at
the discretion of the Board until application can be made in respect of such
number of Shares as the Board consider appropriate.

 

11.                                          Employment
Rights

 

(A)                    This Plan shall
not form part of any contract of employment between any member of the Group and
any employee of any such company and the rights and obligations of any
individual under the terms of his office or employment with any member of the
Group shall not be affected by his participation in the Plan or any right which
he may have to participate therein.

 

(B)                      Participation in
the Plan shall be on the express condition that:-

 

(i)                           neither it
nor cessation of participation shall afford any individual under the terms of
his office or employment with any member of the Group any additional or other
rights to compensation or damages; and

 

(ii)                        no damages or
compensation shall be payable in consequence of the termination of such office
or employment (whether or not in circumstances giving rise to a claim for
wrongful or unfair dismissal) or for any other reason whatsoever to compensate
him for the loss of any rights the Participant would otherwise have had (actual
or prospective) under the Plan howsoever arising but for such termination; and

 

(iii)                     the Participant
shall be deemed irrevocably to have waived any such rights to which he may
otherwise have been entitled.

 

(C)                      No individual
shall have any claim against a member of the Group arising out of his not being
admitted to participation in the Plan which (for the avoidance of all if any
doubt) is governed entirely by the Rules of the Plan.

 

13

 

(D)                     No Participant
shall be entitled to claim compensation from any member of the Group in respect
of any sums paid by him pursuant to the Plan or for any diminution or
extinction of his rights or benefits (actual or otherwise) under any Option
held by him consequent upon the lapse for any reason of any Option held by him
or otherwise in connection with the Plan and each member of the Group shall be
entirely free to conduct its affairs as it sees fit without regard to any
consequences under, upon or in relation to the Plan or any Option or
Participant.

 

12.                                          Administration
of the Plan

 

(A)                    The Board may make
and vary such regulations (not being inconsistent with the Plan) as it thinks
fit for the administration and implementation of the Plan.  The Board’s decision on any matter concerning
the Plan or its interpretation (other than a matter to be certified by the
Auditors) shall be final and binding.

 

(B)                      The Board shall
be entitled by resolution to amend all or any of the provisions of the Plan as
the Board thinks fit except that no alteration shall be made:-

 

(i)                           to the
advantage of Participants without the prior sanction of an ordinary resolution
of the Company in general meeting except for minor amendments to benefit the
administration of the Plan and amendments to obtain or maintain favourable tax,
exchange control or regulatory treatment for Participants in the Plan or for
any member of the Group; or

 

(ii)                        to any rights
already accrued to any Participant which would be to the disadvantage of such
Participant, without the prior consent of such Participant.

 

(C)                      Written notice
of any alteration made in accordance with Rule 12(B) above shall be given to
all Participants.

 

(D)                     The Company shall
keep available sufficient issued and/or unissued Shares (including Shares to be
represented by ADSs) in the capital of the Company to satisfy the exercise in
full of all Options for the time being remaining capable of being exercised.

 

(E)                       Participants
shall be sent copies of any document having a material effect on their rights
at the same time as such document is sent to holders of Shares.

 

(F)                       The provisions
of the Company’s Articles of Association for the time being in force with
regard to the service of notices upon members of the Company shall apply
mutatis mutandis to any notice to be given by the Company to Participants.

 

(G)                      Notwithstanding
anything to the contrary contained herein, the Board may at any time and from
time to time by resolution and without further formality amend the Plan in such
manner as the Board may consider necessary or desirable in order to comply
with, take advantage of, or otherwise in connection with any taxation, legal,
regulatory or other rule, law, guideline, regulation or other provision of or
prevailing in any jurisdiction in which this Plan is or is intended to be
operated PROVIDED

 

14

 

that no such amendment shall be made to the
advantage of Participants save as specified in Rule 12(B)(i) above without the
prior approval of the Company in General Meeting.

 

13.                                          Termination of
the Plan

 

The Plan may
be terminated at any time by the Board or by the Company in general meeting but
in any event shall terminate on the tenth anniversary of the Commencement Date
and on such termination no further Options shall be granted, but the subsisting
rights of Participants shall not be affected by such termination.

 

14.                                          General

 

(A)                    Any Participating
Company may provide money to the Trustee or any other person to enable them or
him to acquire Shares to be held for the purposes of the Plan, or enter into
any guarantee or indemnity for those purposes, to the extent not prohibited by Section 151
of the Companies Act 1985.

 

(B)                      The Plan shall
be subject to, governed and construed in accordance with English law and for
the avoidance of doubt, notwithstanding any translation of the Plan rules, the
English version of the Plan rules shall prevail at all times.

 

15

 

SCHEDULE 1

 

SPECIAL INTERNATIONAL RULES

 

The Rules of the Plan apply with and
subject to the following amendments and provisions which have been adopted by
the Board pursuant to Rule 12(G) for the purposes of the operation of the Plan
in the jurisdictions specified below:

 

Australia
(Appendix 8)

Belgium
(Appendix 1)

Bosnia
(Appendix 12)

Canada
(Appendix 2)

Czech Republic
(Appendix 10)

France
(Appendix 3)

Germany
(Appendix 9)

Ireland
(Appendix 5)

Italy
(Appenix 11)

New Zealand
(Appendix 6)

Singapore
(Appendix 7)

United States
(Appendix 4)

 

The Rules of the Plan apply in the
jurisdictions specified below:

 

Greece

Hong Kong

Hungary

Kazakhstan

Kyrgyz
Republic

Netherlands

Poland

Russia

Slovakia

Slovenia

Taiwan

Turkey

 

16

 

APPENDIX 1

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR BELGIUM

 

The purpose of this appendix is to specify
terms and conditions under which the Plan is to be modified in its application
to any Option granted or to be granted to a person resident for tax purposes in
Belgium.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 1 except as otherwise provided.

 

Rule
7(A)                                                                               this rule shall be deleted and replaced with

 

“(A)              The extent to which an
Option may be exercised on or after the Normal Repayment Date related to the
Option, shall be either:-

 

(i)                           in
full;  or

 

(ii)                        in respect of a participant who ceased to be an employee or director
of any member of the Group (so as to hold no such employment or office) in that
proportion which the number of specified contributions, which shall have been
made on or before the date the Participant ceased to be an employee or director
of any member of the Group bears to the Relevant Multiple.”

 

Rule
7(D)                                                                               delete the words “save as otherwise provided, an” and replace with “An”.

 

Rule
7(E)                                                                                 delete the three lines after paragraph (iii) in Rule 7(E) and
replace with the following:-

 

“in any of
which circumstances the Option may be exercised at any time during the period
of six months from the Normal Repayment Date.”

 

Rule
7(G)                                                                               delete Rule 7(G) and replace with the following:-

 

“(G)                In the event of the
death of a Participant prior to the Normal Repayment Date the Option may be
exercised by his personal representatives at any time during the period of the
six months commencing on the Normal Repayment Date and in the event of the
death of a Participant within six months commencing on the Normal Repayment
Date his personal representatives may exercise the Option at any time within 12
months commencing on the Normal Repayment Date”.

 

Rule
7(H)                                                                               shall be deleted in its entirety.

 

Rule
7(I)                                                                                    in line 1 after the words “becomes exercisable” insert “after the
Normal Repayment Date whether or not the employee ceases to hold office or

 

17

 

employment
with any member of the Group” and delete the words “before the Normal Repayment
Date” in the first and second line.

 

Rule
8(B)                                                                               shall be amended by deleting the reference to “Rule 7(H) above” in
the final line;

 

Rule
9                                                                                                Rule 9 shall be deleted in its entirety and replaced with the
following:-

 

“9. Takeover
and liquidation

 

(A)                    In the event of:-

 

(i)                  a change of Control
of the Company in accordance with Rule 9(B);

 

(ii)              a Section 425 Companies Act 1985 the Court sanctions a
compromise or arrangement, reconstruction or amalgamation;

 

(iii)           a person becoming bound or
entitled to acquire Shares pursuant to Sections 428-430 of the Companies Act
1985;

 

(iv)          the passing of a resolution
for the voluntary winding up of the Company

 

an appropriate
offer or proposal shall be made to the Belgian Participants in respect of any
Subsisting Options.

 

(B)                      A person obtains
control of the Company as a result of making:-

 

(i)                 a general
offer to acquire the whole of the issued share capital of the Company (not
otherwise held or contracted to be acquired by the offeror) which is made on a
condition such that if it is satisfied the person making the offer will have
Control of the Company;  or

 

(ii)              a general offer to acquire all shares in the Company which
are of the same class as the Shares (including the Shares represented by ADSs).

 

(C)                      For the purposes
of this Rule 9 a person shall be deemed to have obtained Control of a Company
if he and others acting in concert with him have together obtained control of
it.

 

18

 

APPENDIX 2

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR CANADA

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its application
to any Option granted or to be granted to a person resident for tax purposes in
Canada.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 2 except as otherwise provided.

 

Rule 1

 

“Grantor”                                                             insert the words “, in the case of non-Canadian resident employees,”
after the words “either the Board or”.

 

“Trustee”                                                            insert the phrase “(excluding employees resident in Canada)” after
the words “wholly or partly for the benefit of all or most of the persons”.

 

Rule
10(B)                                                     is deleted and replaced with the following:

 

“(B)                The Shares are
currently listed on the Official List of the London Stock Exchange. It is
within the Board’s discretion to apply for admission to the Official List for
any subsequently allotted Shares.”

 

Rule
14(A)                                                     is amended by inserting the words “authorised by the Board” after
the words “Any Participating Company may provide money to the Trustee or any
other person”.

 

19

 

APPENDIX 3

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR FRANCE

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified so as to
conform with articles L225-177 to L225-186 of the French Code de
Commerce as amended (the “Code”) and an
administrative regulation (the “Instruction”)
dated 6 May 1988, reference N-3-88 and various articles of the French Tax Code,
to the extent required under French law in order to: (i) ensure that Options
may be granted to Eligible Employees who are French residents for tax purposes
(“French Eligible  Employees”)
under the Plan; and (ii) obtain the most favourable tax treatment of the Plan
available under French law from the perspective of the Group and any French
Eligible Employee.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 3 except as otherwise provided.

 

Rule 1

 

“Eligible
Employee”                                                                the following shall be added to the end of this definition;

 

“and
the employee does not own more than 10% of the share capital of the Company”;

 

“Participant”                                                                                                     shall be amended by deleting the words “personal representatives”
and replacing them with the words “héritiers
(heirs)”;

 

“Specified
Age”                                                                                   shall be deleted;

 

“Subsidiary”                                                                                                     the following paragraph shall be added to this definition;

 

“Furthermore,
a French company will only be deemed to be a subsidiary if, in addition to the
conditions set out above, it is a company in which the Company holds directly
or indirectly, at least 10% of the share capital and/or voting rights”;

 

Rule 3(D)                                                                                                                     shall be amended by deleting the words “Within forty-two days of the
date pursuant to Rule 5(A)(i) below by reference to which the Exercise Price
was determined” and replacing them with the words “Within forty-two days of the
dealing day immediately preceding the Invitation Date”;

 

Rule
3(G)                                                                                                                     shall be amended to read:

 

20

 

“No
Option will be granted more than five years after the Adoption Date.  No Option will be granted (i) during the
period of twenty dealing days on the London Stock Exchange immediately
following the payment of any cash dividend or stock dividend or the ex-dividend
date for any such dividend, (ii) during the ten dealing days on the London
Stock Exchange both preceding and following the date on which the consolidated
accounts of the Company (or if consolidated accounts are not drawn up, the
annual accounts) are made public, and (iii) during the period elapsing between
the date on which the corporate bodies of the Company are made aware of information
which, if made public, could have a significant impact on the market price of
the shares of the Company, and the date which is ten dealing days after the
date on which such information is made public.”;

 

Rule
5 (A)(i)                                                                                                      shall be deleted and replaced with the following wording:

 

“subject
to Rule 5(B), eighty per cent of the average middle market quotation per Share
as derived from the Daily Official List of the London Stock Exchange for the
twenty dealing days immediately preceding the Date of Grant.”;

 

Rule 5 (B)                                                                                                                  shall be deleted and replaced with the following wording:

 

“For
the purposes of an Option granted at any time at which there shall be no
dealings in the Shares, the Exercise Price shall be not less than such sum as
may be determined by the Board, in accordance with the valuation rules set
forth in article L225-177 of the Code, to be the market value of a Share
on the Date of Grant.”;

 

Rule
6                                                                                                                                      shall be deleted and replaced with the following wording:

 

“In
principle the Exercise Price shall not be modified during the life of the
Option.  However, in the event of any
alteration in the issued share capital of the Company (whether by way of
capitalisation of profits or reserves or any sub-division or reduction of capital,
or any other operation envisaged by article L225-181 of the Code), then the Exercise Price may be adjusted by the Board in
such manner and with effect from such date as the Board may deem appropriate in
order to comply with article L225-181.”;

 

Rule
7 (E)                                                                                                                    shall be deleted and replaced with the following:

 

21

 

“An
Option shall cease to be exercisable upon the Participant ceasing to be an
employee or director of any member of the Group (so as to hold no such
employment or office) except where his so ceasing is by reason of any of the
following circumstances:

 

(i)                 redundancy
(licenciement pour motif économique);

 

(ii)              his being required by his employer to take retirement (mise à la retraite), or his taking retirement, in both
cases, in circumstances where he is entitled to a full pension (retraite à taux plein) and has reached an age at which he is
entitled to exercise his pension rights (l’âge d’ouverture des
droits à la retraite);

 

(iii)           invalidity corresponding to the second or third category specified
in article L341-4 of the Code de la Sécurité
Sociale;

 

(iv)          his office or employment being either in a company which ceases to
be a Subsidiary or relating to a business or part of a business which is
transferred to a person who or which is neither a Subsidiary nor a Group
company;

 

(v)             his leaving service for any reason other than specified in
sub-paragraph (i) to (iv), at a time not earlier than three years from the Date
of Grant.

 

In
cases of (i), (ii), (iii), (iv) and (v), the Option may be exercised at any
time during the period of six months from the date on which the Participant
ceases to be an employee or director of any member of the Group notwithstanding
that the Normal Repayment Date shall not have occurred.

 

Rule
7(G)                                                                               shall be amended to read as follows:

 

“In the
event of the death of a Participant prior to the Normal Repayment Date, the
Option may be exercised by his heirs (héritiers) at
any time during the period of six months commencing on the date of his death
(but not later) and the relevant héritiers
(heirs) shall be entitled to do so notwithstanding that the Normal Repayment
Date has not occurred.  For the avoidance
of doubt, the provisions of Rule 7(A)(ii) above shall apply.  In the event of the death of a Participant
within six months commencing on the Normal Repayment Date, his heirs (héritiers) may exercise the Option at any time within the
twelve months commencing on the Normal Repayment Date.”;

 

Rule
7(H)                                                                               shall be deleted in its entirety;

 

Rule
8(B)                                                                               shall be amended by deleting the reference to “Rule 7(H) above” in
the final line;

 

22

 

Rule
9                                                                                                shall be deleted in its entirety and replaced with the following:

 

    “9.   Takeover and Liquidation

 

(A)                    In the event of:

 

(i)                           a change of
Control of the Company in accordance with Rule 9(B);

 

(ii)                        the Court
sanctioning a compromise or arrangement, reconstruction or amalgamation under Section 425
Companies Act 1985;

 

(iii)                     a person becoming
bound or entitled to acquire Shares pursuant to Sections 428-430 of the
Companies Act 1985;

 

(iv)                    the passing of a
resolution for the voluntary winding up of the Company

 

an
appropriate offer or proposal shall be made to the French Participants in
respect of any Subsisting Options.

 

(B)        A person obtains control of
the Company as a result of making:

 

(i)                           a general
offer to acquire the whole of the issued share capital of the Company (not
otherwise held or contracted to be acquired by the offeror) which is made on
the condition such that if it is satisfied the person making the offer will
have the Control of the Company; or

 

(ii)                        a general
offer to acquire all the shares in the Company which are of the same class as
the Shares (including the Shares represented by the ADS).

 

(C)                      For the purposes of this Rule 9 a person shall be deemed to have
obtained Control of a Company if he and others acting in concert with him have
together obtained control of it.”;

 

Rule
12                                                                                         The following wording should be added to the end of this Rule:

 

“(H)               In order to ensure the
most favourable treatment for the Group (as a first priority) and for the
French Eligible Employees (as a second priority) in terms of taxes, social
security charges and all similar duties whatsoever, under French law from time
to time in force, the Board may, in accordance with article L225-177 of
the Code, impose an interdiction de revente
immédiate (“Compulsory Holding Period”) during which the Shares
acquired on exercise of any Option may not be sold by the French Eligible
Employee (except in circumstances where such sale will not undermine a
favourable regime otherwise applying, including for example those circumstances
specified in article 91 ter of Annexe II of the Tax Code).  The Compulsory Holding Period may in no

 

23

 

circumstances
exceed three years from the date of exercise of the relevant Option.

 

Furthermore,
the Board may require the French Eligible Employees to expressly undertake to
respect a Compulsory Holding Period, and, in the event of breach of this
undertaking, to indemnify their French employing company and any member of the
Imperial Tobacco Group in respect of all charges, expenses or liability of any
nature whatsoever incurred by such entities as a result of such breach.”

 

Rule
13                                                                                         The following words shall be added to this Rule:

 

“Furthermore,
no further Options will be granted by the Board after the fifth anniversary of
the Adoption Date unless authorisation is given by the Company in general
meeting for the Board to do so.  Such
authorisation may be granted for a further period of up to 38 months.”;

 

Rule
14(B)                                                                        The following wording shall be added to this Rule:

 

“,
although for the purposes of Options granted to French Eligible Employees, the
terms and conditions of the Plan shall be interpreted in accordance with French
law, where necessary in order to ensure compliance with the Code, the
Instruction and the relevant articles of the Tax Code, to the extent required
under French law in order to ensure the most favourable tax treatment of the Plan
from the perspective of the Group, as a first priority, and the French Eligible
Employees, as a second priority.”.

 

24

 

APPENDIX 4

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR THE UNITED STATES OF AMERICA

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
application to any Option granted or to be granted to a person resident for tax
purposes in the United States of America.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 4 except as otherwise provided.

 

Rule 1

 

	
  “Exercise Price”

  	
  the price per Share or price per ADS at
  which a participant may acquire Shares or ADSs pursuant to the Plan (as
  determined in accordance with Rule 5).

  
	
   

  	
   

  
	
  “Option”

  	
  a right to acquire Shares, or ADSs,
  granted pursuant to the Plan.

  
	
   

  	
   

  
	
  Rule 3(B)(i)

  	
  insert “or the ADSs, if applicable,”
  after the words “Exercise Price for the Shares”.

  
	
   

  	
   

  
	
  Rule 3(B)(ii)

  	
  insert as a new Rule 3(B)(ii) the
  following and re-number Rule 3(B)(ii) and 3(B)(iii) as 3(B)(iii) and 3(B)(iv)
  respectively.

  
	
   

  	
   

  
	
   

  	
  “(ii)                            whether
  the Shares to be issued upon the exercise of Options may be delivered in the
  form of ADSs; and”

  
	
   

  	
   

  
	
  Rule 3(C)(i)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares” in the penultimate line.

  
	
   

  	
   

  
	
  Rule 3(C)(ii)(a)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares” in lines 4 and 5.

  
	
   

  	
   

  
	
  Rule 3(D)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares” in line 2.

  
	
   

  	
   

  
	
  Rule 3(D)(i)

  	
  insert the following words after
  “Invitation Date” in the final line:

  
	
   

  	
   

  
	
   

  	
  “and, if permitted by the relevant
  invitations, Options shall be granted to the Eligible Employee in respect of
  that number of ADSs as would have an aggregate Exercise Price not exceeding
  the Relevant Multiple of the Eligible Employee’s proposed monthly dollar
  contributions to the Savings Plan as at the Date of Grant;”

  
	
   

  	
   

  
	
  Rule 3(D)(ii) and (iii)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares” wherever that word occurs.

  

 

25

 

	
  Rule 5(A)

  	
  in line 3 insert the words “or expressed
  in dollars in the case of Options for ADSs” after the words “in the case of
  Options for Shares”.

  
	
   

  	
   

  
	
  Rule 5(A)(i)

  	
  insert after the words “Invitation Date”
  in the final line, the words “or eighty per cent of the closing price per ADS
  as derived from the New York Stock Exchange Consolidated Tape on the trading
  day immediately preceding the Invitation Date in the case of Options for
  ADS;”.

  
	
   

  	
   

  
	
  Rule 5(A)(ii)

  	
  insert at the end of this rule “or the
  nominal value of the Shares represented by ADS in the case of Options for
  ADSs”.

  
	
   

  	
   

  
	
  Rule 5(B)

  	
  insert after the word “Shares” in line 2
  “or ADSs, if applicable” and after the words “market value of a Share” in the
  last line “or ADS, respectively”.

  
	
   

  	
   

  
	
  Rule 6

  	
  insert in the first line in the paragraph
  after “(d)” the words “or ADSs, if applicable,” after the words “the number
  of Shares”.

  
	
   

  	
   

  
	
  Rule 6(ii)

  	
  insert after the words “nominal value of
  a Share”, in line 2 “and the Exercise price of an Option to subscribe for ADS
  shall not be adjusted below the aggregate nominal value of the Shares represented
  by such ADSs”.

  
	
   

  	
   

  
	
  Rule 7(B)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares” wherever that word occurs.

  
	
   

  	
   

  
	
  Rule 7(C)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares” wherever that word occurs.

  
	
   

  	
   

  
	
  Rule 7(J)

  	
  insert the words “or ADSs, if
  applicable,” after the word “Shares”.

  
	
   

  	
   

  
	
  Rule 9(D)(ii)

  	
  insert the words “or ADSs, if
  applicable,” after the words “Shares” in line 4.

  
	
   

  	
   

  
	
  Rule 10(B)

  	
  insert a new Rule 10(B) as set out below
  after Rule 10(A) and re-designate Rule 10(B) as Rule 10(C):

  
	
   

  	
   

  
	
   

  	
  “10(B)                            Subject
  to receipt of the appropriate remittance, in the event ADSs are to be
  acquired pursuant to the exercise of an Option, ADSs will be transferred not
  later than forty-five days after the exercise of the Option and will rank
  pari passu in all respects with the ADSs in issue on the date of exercise
  save that they will not rank for any dividend or other distribution paid or
  made by reference to the date (known as the ADS record date) on which
  entitlement to the dividend or distribution is fixed by the Depositary if
  that date falls prior to the date of exercise of the Option.”

  
	
   

  	
   

  
	
  Rule 10(D)

  	
  insert a new Rule 10(D) as set out below:

  
	
   

  	
   

  
	
   

  	
  “10(D)                           If the
  ADSs are listed on the New York Stock Exchange, Inc. at the date of transfer
  of ADSs pursuant to the Plan the Company will, if

  

 

26

 

	
   

  	
  required, apply to the New York Stock
  Exchange, Inc. for permission for such ADSs so transferred to be listed on
  the New York Stock Exchange, Inc.”.

  
	
   

  	
   

  
	
  Rule 14(A)

  	
  insert
  the words “or ADSs, if applicable” after the word “Shares” in line     2.

  

 

27

 

APPENDIX 5

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR IRELAND

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
application to any Option granted or to be granted to a person resident for tax
purposes in Ireland.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 5 except as otherwise provided.

 

[To be inserted on receipt of Approval from
the Irish Inland Revenue Commissioners]

 

28

 

APPENDIX 6

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR NEW ZEALAND

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
application to any Option granted or to be granted to a person resident for tax
purposes in New Zealand.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 6 except as otherwise provided.

 

1.                                                The definition of “Specified Age” in Rule 1 shall be deleted.

 

(D)            In
Rule 7 (E) (i) delete the words “on reaching Specified Age or such other age at
which he is bound to retire in accordance with the terms of his employment”.

 

(E)              Rule
7 (H) shall be deleted and Rules 7 (I) and (J) and any references thereto shall
be re-numbered accordingly.

 

29

 

APPENDIX 7

 

IMPERIAL TOBACCO GROUP
INTERNATIONAL SHARESAVE PLAN

 

APPENDIX FOR SINGAPORE

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan to be modified in its application
to any Option granted or to be granted to a person who is employed in Singapore
by a Participating Company.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 7 except as otherwise provided.

 

	
  Rule
  3(C)(ii)(b)

  	
  this rule
  shall be deleted and replaced with

  
	
   

  	
   

  
	
   

  	
  “to require
  the Participant to furnish to the Board, in a manner acceptable to it,
  evidence satisfactory to the Board of the payment of such contributions in
  accordance with the Savings Plan as shall be specified by the Participant
  pursuant to Rule 3(C)(i) or as may be amended pursuant to Rule 3(C)(ii)(a)”.

  

 

30

 

APPENDIX 8

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR AUSTRALIA

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
application to any Option granted or to be granted to a person resident for tax
purposes in Australia.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 8 except as otherwise provided.

 

1.                                                The definition of “Specified Age” in Rule 1 shall be deleted.

 

(F)              In
Rule 7 (E) (i) delete the words “on reaching Specified Age or such other age at
which he is bound to retire in accordance with the terms of his employment”.

 

(G)             Rule
7 (H) shall be deleted and Rules 7 (I) and (J) and any references thereto shall
be re-numbered accordingly.

 

31

 

APPENDIX 9

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR GERMANY 

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
application to any Option granted or to be granted to a person resident for tax
purposes in Germany.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 9 except as otherwise provided.

 

1.                                                The definition of “Specified Age” in Rule 1 shall be deleted.

 

(H)            In
Rule 7 (E) (i) delete the words “on reaching Specified Age or such other age at
which he is bound to retire in accordance with the terms of his employment”.

 

(I)                 Rule
7 (H) shall be deleted and Rules 7 (I) and (J) and any references thereto shall
be re-numbered accordingly.

 

32

 

APPENDIX 10

 

IMPERIAL TOBACCO GROUP
INTERNATIONAL SHARESAVE PLAN

 

APPENDIX FOR CZECH REPUBLIC

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
application to any Option granted or to be granted to a person resident for tax
purposes in the Czech Republic.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 10 except as otherwise provided.

 

	
  Rule 3(C)(ii)

  	
   

  	
  this rule shall be deleted and replaced
  with

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “shall include an undertaking of the Participant to execute an
  agreement with his/her employer on deductions from such Participant’s salary
  (“Agreement on Deductions”) subject to the confirmation of the eligibility of the Participant
  by the employer. The Agreement on Deductions shall further include a joint obligation
  of the contracting parties to conclude an amendment to the Agreement on
  Deductions in the event of any of the circumstances specified in Rule 3(D).
  In particular, in the event that the number of Shares for which an Eligible
  Employee applies for an Option has to be reduced in accordance with Rule
  3(D), the parties shall be required under this provision to conclude an
  amendment regarding reduction of the amount of regular monthly deductions
  from salary without undue delay
  of their notification in writing by the Company that
  such reduction has been approved by the Board.”

  

 

33

 

APPENDIX 11

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR ITALY

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified as to conform
with the provisions of the Italian Civil Code and to various provisions of the
Presidential Decree 22 December 1986, no. 917 (the Italian Consolidated
Tax Act “ICTA”) in order to obtain the most
favourable tax treatment of the Plan available under Italian law from the
perspective of the Group and any Italian Eligible Employee

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 11 except as otherwise provided.

 

 

	
  Rule 1

  	
   

  
	
   

  	
   

  
	
  “Eligible Employee”

  	
  shall be amended to read:

  
	
   

  	
   

  
	
   

  	
  “any employee of a Participating Company
  which has a salaried employment on a permanent basis and any “collaboratore coordinato e continuativo” (including a
  director) of a Participating Company at the Invitation Date PROVIDED HOWEVER
  THAT at the Invitation Date no notice of termination of such employment has
  been served by either the employee concerned or his employing Participating
  Company. Such rule would also apply in respect of any “collaboratore
  coordinato e continuativo” (including a director) of a
  Participating Company”;

  
	
   

  	
   

  
	
  “Participant”

  	
  shall be amended by deleting the words
  “personal representatives” and replacing them with the words “eredi (heirs)”;

  
	
   

  	
   

  
	
  “Specified Age”

  	
  shall be deleted;

  
	
   

  	
   

  
	
  “Subsidiary”

  	
  shall be replaced as follows:

  
	
   

  	
   

  
	
   

  	
  “means any company in relation to which
  the Company:

  
	
   

  	
   

  
	
   

  	
  (a)               holds a majority of
  the voting rights in the ordinary shareholders’ meeting; or

  
	
   

  	
   

  
	
   

  	
  (b)              has sufficient voting
  rights in the ordinary shareholders’ meeting to exercise a prevailing
  influence therein; or

  
	
   

  	
   

  
	
   

  	
  (c)               exercises a
  prevailing influence on the company by virtue of specific negotial
  agreements;

  
	
   

  	
   

  
	
   

  	
  in accordance with the requirements of
  Article 2359 of the Italian Civil Code. Such definition also includes
  any other company which is a 

  

 

34

 

	 
	
   

  	
  subsidiary as defined above of a company
  which is itself a subsidiary of the Company”.

  	 

	 
	
   

  	
   

  	 

	
  Rule 6

  	
  shall be deleted and replaced with the
  following wording:

  
	
   

  	
   

  
	
   

  	
  “In principle the Exercise Price shall
  not be modified during the life of the Option. However, in the event of any
  alteration in the issued share capital of the Company (by way of one of the
  operations envisaged by the Italian Civil Code) then the Exercise Price may
  be adjusted by the Board in such manner and with effect from such date as the
  Board may deem appropriate in order to comply with the provisions of the
  Italian Civil Code”

  
	
   

  	
   

  
	
  Rule 7(E)

  	
  shall be deleted and replaced with:

  
	
   

  	
   

  
	
   

  	
  “(E)                           An Option
  shall cease to be exercisable upon the Participant ceasing to be an employee
  or a “collaboratore coordinato e continuativo”
  of any member of the Group (so as to hold no such employment or office)
  except where his so ceasing is by reason of any of the following
  circumstances:

  
	
   

  	
   

  
	
   

  	
  (i)                       redundancy;
  or

  
	
   

  	
  (ii)                    his being
  required by his employer to take retirement or his taking retirement, in both
  cases, in circumstances where he is entitled to a full pension and has
  reached an age at which he is entitled to exercise his pension rights; or

  
	
   

  	
  (iii)                 invalidity; or

  
	
   

  	
  (iv)                his office or
  employment being either in a company which ceases to be a Subsidiary or
  relating to a business or part of a business which is transferred to a person
  who or which is neither a Subsidiary nor a Group company; or

  
	
   

  	
  (v)                   his leaving
  service at any time other than that specified in sub-paragraph (i) to (iv)
  above, provided that such event occurs not earlier than three years from the
  Date of Grant;

  
	
   

  	
   

  
	
   

  	
  in any of which circumstances the Option
  may be exercised at any time during the period of six months from the date on
  which he so ceases to be an employee or a “collaboratore
  coordinato e continuativo” of any member of the Group
  notwithstanding that the Normal Repayment Date shall not have occurred.

  
	
   

  	
   

  
	
  Rule 7(F)(i)

  	
  shall be replaced with the following
  wording:

  
	
   

  	
   

  
	
   

  	
  “(F)                           For the purposes of Rule 7(E) above and Rule 9 below (but for no
  other purpose):

  
	
   

  	
   

  
	
   

  	
  (i)                       a Participant
  shall not be regarded as having ceased to hold office or employment by reason
  of:

  
				

 

35

 

	
   

  	
  (a)                    his being or
  becoming employed or a “collaboratore
  coordinato e continuativo” by a company which ceases to be or is
  not a Participating Company but is nevertheless an Associated Company or is
  under the Control of the Company; and

  
	
   

  	
   

  
	
   

  	
  (ii)                                  a
  Participant shall be regarded as ceasing to hold office or employment when he
  holds no employment or no agreement of “collaboratore coordinato
  e continuativo” with any of the Company, any Associated Company
  and any company controlled by the Company.”

  
	
   

  	
   

  
	
  Rule
  7(G)

  	
  shall be
  amended by deleting the words “personal representatives” and replacing them
  with the words “eredi (heirs)”;

  
	
   

  	
   

  
	
  Rule
  7(H)

  	
  shall be
  deleted in its entirety;

  
	
   

  	
   

  
	
  Rule 8(B)

  	
  shall be
  amended by deleting the wording “or in the circumstances of Rule 7(H) above”
  in the final line;

  
	
   

  	
   

  
	
  Rule 9

  	
  the
  following words shall be added to this Rule:

  
	
   

  	
   

  
	
   

  	
  “(iii)                         any other operation envisaged by the Italian Civil Code for the
  acquisition of control”;

  

 

36

 

APPENDIX 12

 

IMPERIAL TOBACCO GROUP INTERNATIONAL
SHARESAVE PLAN

 

APPENDIX FOR BOSNIA

 

The purpose of this appendix is to specify
the terms and conditions under which the Plan is to be modified in its
aplication to any Option granted or to be granted to a person resident for tax
purposes in Bosnia.

 

Words or phrases defined in the Plan shall
bear the same meaning in this Appendix 12 except as otherwise provided

 

Rule 1

 

	
  “Specified Age”

  	
  shall be amended by deleting “60” and
  replacing it with “65;”

  

 

37

 

SCHEDULE 2

 

NOTIONAL AWARDS

 

The rules of the Phantom Plan shall be
constituted by the rules of the Plan save as the same (including the definitions
used) are modified by the terms of this Schedule, as set out below.

 

In relation to any invitation made under
the Plan, the terms of this Schedule shall, unless otherwise determined by
the Board, apply in respect of Eligible Employees resident in each of the
following jurisdictions (“Relevant Employees”):-

 

Belgium

Macedonia

Serbia

Ukraine

 

1.                                           In this Plan the following terms shall have the following meanings:-

 

	
  “Award”

  	
  the sum paid
  or to be paid to a Relevant Employee by way of remuneration in accordance
  with this Plan on the exercise of a Notional Award being the difference
  between the Exit Price and the Notional Exercise Price for each Share in
  respect of which the Notional Award is exercised;

  
	
   

  	
   

  
	
  “Exit Price”

  	
  the middle
  market price of a Share as derived from the London Stock Exchange Daily
  Official List for the dealing day immediately preceding that on which a
  Notional Award is exercised;

  
	
   

  	
   

  
	
  “Notional
  Award”

  	
  the notional
  right to acquire at the Notional Exercise Price Shares in accordance with the
  terms of the Plan;

  
	
   

  	
   

  
	
  “Notional
  Gain”

  	
  the sum paid
  or to be paid to a Relevant Employee by way of remuneration in accordance
  with this Plan on the exercise of a Notional Award being the difference
  between the Exit Price and the Notional Exercise Price for each Share in
  respect of which the Notional Award is exercised;

  
	
   

  	
   

  
	
  “Notional
  Exercise Price”

  	
  the price
  per Share at which a Participant may acquire Shares the subject of a Notional
  Award calculated in accordance with Rule 5 of the Plan;

  
	
   

  	
   

  
	
  “Subsisting Notional
  Award”

  	
  a Notional
  Award to the extent that it has neither lapsed nor been exercised;

  

 

38

 

2.                                           In Rules 3, 8, 9, 11, 12 and 13 of the Plan references to Option,
Exercise Price, and Eligible Employee shall be replaced by references to
Notional Award, Notional Exercise Price, and Relevant Employee respectively.

 

3.                                           In respect of each grant of Notional Awards, the Board shall
identify those Relevant Employees to whom Notional Awards shall be granted and
shall grant the Notional Award(s) in the same manner as provided in Rule 3(D)
of the Plan.  For the avoidance of doubt,
Rule 3(D)(iii) of the Plan shall apply to the grant of Notional Awards as it
does for the grant of Options under the Plan. 
The Relevant Employee will be given a certificate stating the Notional
Exercise Price and the number of Shares subject to the Notional Award.

 

4.                                           In Rule 4, for the purposes of calculating the limits contained
therein, the aggregate number of Shares shall include the number of Shares the
subject of Notional Awards.

 

5.                                           The Notional Award shall be capable of being exercised in all
respects in the same manner as an Option in accordance with Rule 7 of the Plan
save that no payment or remittance is due as provided in Rules 7(A) and (B).

 

6.                                           Rule 7(C) shall be deleted and replaced with the following:

 

“(C)                                   It
is a condition of the exercise of a Notional Award under the Phantom Plan that
the Participant shall withdraw all sums due by way of Repayment under the
Savings Plan to which he has contributed in relation to the Notional
Award.  If upon the exercise of a
Notional Award the Repayment then due to a Participant under his Savings Plan
is less than the aggregate Notional Exercise Price for all the Shares in
respect of which it may be exercised pursuant to Rule 7(A) above the
Participant may add to the Repayment up to a maximum of such sum as shall be
necessary to pay for all such Shares.  If
the Repayment shall exceed the Notional Exercise Price for all the Shares in
respect of which the Notional Award can be exercised (or for the Shares in
respect of which the Notional Award is in fact exercised, if lower) such excess
shall be paid to the Participant.”(1)

 

7.                                           Rule 9(D) and 10 of the Plan shall not apply in relation to the Notional
Options.

 

8.                                           Within 30 days of receipt of the appropriate notice in accordance
with Rule 7 the Board shall procure payment to the Relevant Employee of the
Notional Gain attributable to the Shares in respect of which the Notional Award
has been exercised.

 

9.                                           There shall be made from any payment under Rule 8 of the Phantom
Plan such deductions (on account of tax, national insurance contributions,
social security contributions or similar liabilities) as may be required by law
or as the Company may reasonably consider to be necessary or desirable.

 

10.                                     If
there is an adjustment to Options pursuant to Rule 6 of the Plan, an adjustment
confirmed by the Auditors in writing to be in their opinion an equivalent
adjustment shall be made to Notional Awards.

 

(1)          This provision has been
drafted so that if savings insufficient to acquire the number of Shares (for
equivalent real option), Participant is required to top up his savings prior to
exercising his notional awards.

 

39

 

11.                                     Payments
under Rule 8 of the Phantom Plan will not be pensionable.

 

40

 

SCHEDULE 2,
APPENDIX 1

 

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN – PHANTOM PLAN

 

APPENDIX
FOR CANADA

 

The purpose of this
appendix is to specify the terms and conditions under which the Phantom Plan is
to be modified in its application to any Notional Award granted or to be
granted to a person resident for tax purposes in Canada.

 

Words or phrases defined in the Phantom
Plan shall bear the same meaning in this Appendix 1 except as otherwise
provided.

 

Section 1

 

	
  “Award”

  	
  delete the word “remuneration” after the
  words “to be paid to a Relevant Employee by way of” and replace with the
  phrase “a bonus or similar payment in respect of services rendered by the
  Relevant Employee”, and add the phrase “, but only if the Exit Price is
  higher than the Notional Exercise Price” after the words “in respect of which
  the Notional Award is exercised”.

  
	
   

  	
   

  
	
  “Notional Gain”

  	
  delete the word “remuneration” after the
  words “to be paid to a Relevant Employee by way of” and replace with the
  phrase “a bonus or similar payment in respect of services rendered by the
  Relevant Employee”, and add the phrase “, but only if the Exit Price is higher
  than the Notional Exercise Price” after the words “in respect of which the
  Notional Award is exercised”.

  
	
   

  	
   

  
	
  Section 5

  	
  is deleted and replaced with the
  following:

  

 

5.                                       (a)                                          The Notional Award shall be capable of being exercised in all
respects in the same manner as an Option in accordance with Rule 7 of the Plan
save that no payment or remittance is due as provided in Rules 7(A) and (B),
and provided that, notwithstanding any other provision of the Plan or the
Phantom Plan, no amount in respect of an Award or a Notional Gain shall be paid
to a Relevant Employee later than the end of the calendar year which is the
third calendar year immediately following the end of the calendar year of the
Date of Grant.

 

(b)                                           Rule 7(D) shall be deleted and replaced with the following:

 

(D)                     Save as otherwise
provided, an Option may not be exercised until the Normal Repayment date. No
Option (including for greater certainty a Subsisting Option) may be exercised
later than 6 months after the Normal Repayment Date or November 15th
in the calendar year of the Normal Repayment Date,

 

41

 

whichever is
earlier, and all Options in repsect of which the Exit Price is higher than the
Notional Exercise Price which are not already exercised shall be deemed to be
exercised on November 15th in the calendar year of the Normal
Repayment date, and for this purpose the Participant must elect to add to the
Repayment for the purposes of Rule 7(c) by November 30th of the
calendar year of the Normal Repayment Date. [NTD: The
dates within this Appendix may be changed at Imperial’s discretion as long as
all cash awards are distributed to employees in Canada by December 31 in
the third calendar following date of grant (e.g. if grant made in 2004, award
must be paid by December 31 2007.) We have tried to ensure that there is
sufficient time between the Normal Repayment Date, the exercise and the
distribution of the award]. For greater certainty, all Options
(including Subsisting Options) in respect of which the Exit Price is equal to
or less than the Notional Exercise Price shall not be deemed to be exercised
pursuant to this Rule 7(D).

 

(c)                                            Rule 7(E) shall be amended by adding the phrase “or by November 15th
in the calendar year of the Normal Repayment Date (except to the extent that
such Option is deemed to be exercised in accordance with Rule 7(D)), whichever
is earlier” after the words “notwithstanding that the Normal Repayment Date
shall not have occurred”.

 

(d)                                           Rule 7(G) shall be amended by adding the phrase “, but in any event
the personal representatives shall not be entitled to exercise the Option
(except to the extent that such Option is deemed to be exercised in accordance
with Rule 7(D)) later than November 15th in the calendar year
of the Normal Repayment Date” after the words “within twelve months commencing
on the Normal Repayment Date”.

 

(e)                                            Rule 7(H) shall be amended by adding the phrase “or by November 15th
in the calendar year of the Normal Repayment Date (except to the extent that
such Option is deemed to be exercised in accordance with Rule 7(D)), whichever
is earlier” after the words “within six months after the date of his reaching
the Specified Age”.

 

(f)                                              Rule 8(B) shall be amended by adding “provided that in no event
shall the Normal Payment Date occur later than November 1 of the calendar
year which is the third calendar year immediately following the end of the
calendar year of the Date of Grant”, to be added after the words “above or Rule
9 below”.

 

(g)                                           Rule 9(A) shall be amended by adding the phrase “, but in any event
not later than November 15th of the calendar year of the Normal
Repayment Date (except to the extent that such Option is deemed to be exercised
in accordance with Rule 7(D)) “ after the words “is made had been satisfied”.

 

(h)                                           Rule 9(B) shall be amended by adding the phrase “, but in any event
not later than November 15th of the calendar year of the Normal
Repayment Date (except to the extent that such Option is deemed to be exercised
in accordance with Rule 7(D)) “ after the words “of the Court sanctioning the
compromise or arrangement”.

 

42

 

(i)                                               Rule 9(C) shall be amended by adding the phrase “, but in any event
not later than November 15th of the calendar year of the Normal
Repayment Date (except to the extent that such Option is deemed to be exercised
in accordance with Rule 7(D)) “ after the words “that person remains so bound
or entitled”.

 

(j)                                               Rule 9(D) shall be amended by adding the phrase “, but in any event
not later than November 15th of the calendar year of the Normal
Repayment Date, “ after the words “as defined in paragraph 15(2) of Schedule 9”.

 

(k)                                            Rule 9(E) shall be deleted and replaced with the following:

 

(E)                       If the Company
passes a resolution for voluntary winding up, any Subsisting Option may be
exercised at any time within six months of the passing of the resolution or by November 15th
of the calendar year of the Normal Repayment Date in respect of such Subsisting
Option (except to the extent that such Subsisting Option is deemed to be
exercised in accordance with Rule 7(D)), whichever is earlier.

 

43

 

SPECIMEN

 

THE
IMPERIAL TOBACCO GROUP

INTERNATIONAL
SHARESAVE PLAN (the “Plan”)

 

INVITATION

(on
Company headed notepaper)

 

Dear Colleague,

 

The Directors
of Imperial Tobacco Group PLC invite you to apply for an option to acquire
ordinary shares in Imperial Tobacco Group PLC (the “Company”) under the Rules
of the above Plan.

 

Enclosed are:-

 

1.                                                                                       a booklet which explains how the Plan works;

 

2.                                                                                       an application for a share option;

 

3.                                                                                       [an application to open a savings account with
[                   ];

 

4.                                                                                       a note explaining the terms of the savings account.

 

You should
read these documents carefully before deciding to commit yourself to
participating.  If you are in any doubt
about any feature of the Plan, please contact •.

 

Under the
Rules you are entitled to take out a savings contract, with a monthly
contribution of up to £250 or its equivalent in your local currency.  If you wish, however, you can take out a
contract, depending upon the frequency of your salary payments, for any amount
up to the maximum, subject to a minimum contribution of £10 per month (or the
equivalent sum at the Date of Grant in the currency of your country of
employment).

 

If you would
like to join the Plan you should complete and sign the attached Share Option
Application and savings account application forms.  THESE MUST BE RETURNED TO ME NOT LATER THAN
[    PM] ON
[                ].  IT WILL NOT BE POSSIBLE TO CONSIDER
APPLICATIONS RECEIVED AFTER THAT DATE.

 

Yours sincerely

 

 

[Company Secretary]

 

44

 

SPECIMEN

THE
IMPERIAL TOBACCO GROUP PLC

INTERNATIONAL
SHARESAVE PLAN

 

 

SHARE
OPTION APPLICATION

 

To:                              The Plan Administrator

 

PLEASE USE BLOCK CAPITALS

 

	
   

  	
   

  
	
  SURNAME

  	
   

  	
   MR/MRS/MISS/MS

  	
   

  	
   

  
	
   

  
	
  FIRST NAMES

  	
   

  	
   

  
	
   

  	
   

  
	
  HOME ADDRESS

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  POSTCODE

  	
   

  	
   

  
	
   

  	
   

  
	
  PLACE OF EMPLOYMENT

  	
   

  	
   

  
												

 

I wish to save up to
[£            ] per
month (between £10 and £250) for 36 months (or the equivalent sums at the Date
of Grant in the currency of my country of employment)

 

NOTES:                                                  (1)                                     Contributions must be not less than £10 per month and the aggregate
contributions to be made in any month under this contract and any other
contract(s) linked to this Plan into which you have previously entered must not
be more than £250.  For weekly paid
employees, a quarter of the monthly amount will be deducted weekly until the
equivalent of [36/60] monthly payments have been made, (or the equivalent sums
at the Date of Grant in the currency of your country of employment).

 

(2)                                  The
Normal Repayment Date may be postponed if you miss any contributions.

 

PLEASE READ AND SIGN

 

*                                I
hereby apply for an option over ordinary shares in the capital of Imperial
Tobacco Group PLC, the cost of which will be met from repayments and any
additional sums under the savings contract for which a proposal form is
attached.

 

*                                I
hereby declare that I am applying for an option on my own behalf and not as a
trustee or nominee for any other person(s).

 

*                                I
hereby authorise the Company to submit my savings application to
[            ] on
my behalf and to make the corresponding deductions from my pay.

 

45

 

*                                I
authorise the Company Secretary to make such adjustments to the amount to be
saved by me under the savings contract referred to above as may be necessary if
my application is scaled down in accordance with the Rules of the Plan and the
number of shares allotted to me is less than the number of shares which I have
applied for, further I authorise the Company to submit such amended savings
application to
[            ].

 

*                                I
understand that if I am granted an option it will be subject to the Rules of
the Plan, by which I agree to be bound. 
A copy of the Rules of the Plan is available for inspection at
[                       ].

 

Unless the context otherwise requires terms defined in the Rules of the
Plan shall have the same meaning herein.

 

	
  SIGNATURE

  	
   

  	
  DATE

  

 

46

 

SPECIMEN

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN

 

OPTION CERTIFICATE

 

	
  Name of Option Holder

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Address of Option Holder

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
    Post Code

  	
   

  	
   

  
	
   

  
	
  Option Certificate number

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Number of shares granted under this option

  	
   

  	
   

  
	
   

  	
   

  
	
  Date of grant

  	
   

  	
   

  
										

 

This is to certify that the above named
person was on the above date granted an option as specified for ordinary shares
of [  ]p each in the capital of Imperial
Tobacco Group PLC (the “Company”) at an exercise price of [     ]p per share upon and subject to the terms
of The Imperial Tobacco Group International Sharesave Plan.

 

Signed on behalf of

 

 

	
   

  	
   Director

  	
   

  	
   Secretary

  

 

NOTES:                                                  (1)                                     The option cannot be assigned or transferred.

 

(2)                                  In
order to exercise your option complete the Form of Exercise printed overleaf
and send it together with a cheque for the relevant exercise price of the
shares and evidence of the amount repaid under your savings contract to the
Company Secretary of the Company.

 

THIS DOCUMENT MUST BE RETAINED.  PLEASE KEEP IT IN A SAFE PLACE.  This certificate is issued as a matter of
record only and is not a document of title.

 

47

 

SPECIMEN

 

[Reverse of Certificate]

 

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN

 

 

FORM OF EXERCISE OF OPTION

 

To:                                                                              The Company Secretary

Imperial
Tobacco Group PLC

 

 

(In order to exercise your option you
should complete, sign and return this document to the Company Secretary at the
above address.)

 

1.                                                                                       I wish to exercise the option referred to on the reverse Option
Certificate in respect of [           ]
ordinary shares.  (Insert the number of
shares in respect of which the option is exercised.  If you do not wish to exercise the option for
all the shares shown on the attached certificate you may exercise options for a
lesser number.

 

2.                                                                                       I enclose a cheque for £
                     in
favour of Imperial Tobacco Group PLC being the total exercise price payable
under this option for the above specified number of ordinary shares together
with evidence of the amount repaid to me under my savings contract.

 

Personal Details

 

	
  SURNAME

  	
   

  	
   MR/MRS/MISS/MS

  	
   

  	
   

  
	
   

  
	
  FIRST NAMES

  	
   

  	
   

  
	
   

  	
   

  
	
  HOME ADDRESS

  	
   

  	
   

  
	
   

  
	
   

  	
   

  	
  POSTCODE

  	
   

  	
   

  
	
   

  	
   

  
	
  SIGNATURE

  	
   

  	
   DATE

  	
   

  	
   

  
															

 

 

NOTE:                     This option may
be exercised only by the person to whom it was granted or their personal
representative(s).

 

IF YOU ARE IN ANY DOUBT, PLEASE CONTACT
YOUR/THE PLAN ADMINISTRATOR

 

48

Exhibit 4.6

 

IMPERIAL TOBACCO GROUP PLC

 

 

THE IMPERIAL TOBACCO GROUP IRISH SHARESAVE
SCHEME

(approved under Schedule 12A Taxes
Consolidation Act, 1997)

 

 

adopted by the Board of Imperial Tobacco
Group Plc on 26th April 2000

pursuant to a shareholders resolution passed on 2nd February 1999

and approved by the Revenue Commissioners on 28th April 2000

 

 

A & L Goodbody

International Financial Services Center,

North Wall Quay,

Dublin 1

 

Tel: 01 - 649-2000

Fax: 
01 - 649-2649

 

 

THE IMPERIAL TOBACCO GROUP IRISH SHARESAVE
SCHEME

 

INDEX

 

 

	
  Clause

  	
   

  	
  Description

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  Definitions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  Commencement and Title

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
   

  	
  Grant of
  Options

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
   

  	
  Limitations on the
  issue of Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  5.

  	
   

  	
  Exercise
  Price

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
   

  	
  Adjustment
  of Options

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  7.

  	
   

  	
  Exercise
  of Options

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  8.

  	
   

  	
  Lapse of
  Options

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  9.

  	
   

  	
  Takeover and Liquidation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  10.

  	
   

  	
  Allotment
  and Listing

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  11.

  	
   

  	
  Employment
  Rights

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  12.

  	
   

  	
  Administration of the
  Scheme

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  13.

  	
   

  	
  Termination of the Scheme

  	
   

  

 

 

RULES OF THE IMPERIAL TOBACCO GROUP SHARESAVE
SCHEME

 

1.                                            Definitions

 

In these Rules
(unless the context otherwise requires) the following words and expressions
have the following meanings:-

 

	
  “Act”

  	
   

  	
  the Taxes Consolidation Act, 1997

  
	
   

  	
   

  	
   

  
	
  “Adoption Date”

  	
   

  	
  the date on which the Scheme is adopted
  by the Board;

  
	
   

  	
   

  	
   

  
	
  “Application Period”

  	
   

  	
  such period as the Board may determine
  but being a period not less than fourteen days and not more than 21 days from
  an Invitation Date;

  
	
   

  	
   

  	
   

  
	
  “Associated Company”

  	
   

  	
  has the same meaning as in Section 432
  of the Act

  
	
   

  	
   

  	
   

  
	
  “Auditors”

  	
   

  	
  the auditors for the time being of the
  Company;

  
	
   

  	
   

  	
   

  
	
  “Board”

  	
   

  	
  the Board of Directors for the time being
  of the Company (or the directors present at a duly convened meeting of such
  Board) or a duly authorised committee thereof;

  
	
   

  	
   

  	
   

  
	
  “Bonus Date”

  	
   

  	
  where Repayment under the relevant
  Savings Contract is taken as including the maximum bonus, the earliest date
  on which the maximum bonus is payable and in any other case the earliest date
  on which a bonus is payable under the Savings Contract;

  
	
   

  	
   

  	
   

  
	
  “Commencement Date”

  	
   

  	
  the date on which the Scheme is approved
  by the Revenue Commissioners;

  
	
   

  	
   

  	
   

  
	
  “Company”

  	
   

  	
  Imperial Tobacco Group PLC;

  
	
   

  	
   

  	
   

  
	
  “Continuous Service”

  	
   

  	
  service with any company which is or was
  a Subsidiary (including service with such company before it became a
  Subsidiary) which shall be aggregated with service with a Participating
  Company 

  

 

1

 

	 
	
   

  	
   

  	
  provided all such service has been
  continuous. In the case of an employee employed in employment by a Participating
  Company who is absent from such employment for any reason for a period during
  which such employee’s contract of service subsists, or by reason of maternity
  leave, and who then returns to such employment with a Participating Company
  then in calculating service any such period of absence shall be deemed to
  have formed part of his continuous service;

  
	 
	
   

  	
   

  	
   

  
	
  “Control”

  	
   

  	
  has the same meaning as in Section 432
  of the Act;

  
	
   

  	
   

  	
   

  
	
  “Date of Grant”

  	
   

  	
  the date on which the Board (or the
  Trustee) passes a resolution to grant an Option under Rule 3(D) below;

  
	
   

  	
   

  	
   

  
	
  “€”

  	
   

  	
  Euro

  
	
   

  	
   

  	
   

  
	
  “Eligible Employee”

  	
   

  	
  any employee (including a full-time
  director holding a salaried employment or office) of a Participating Company
  who (a) on the relevant Date of Grant has achieved such period of Continuous
  Service not exceeding three years as the Board shall on or before the
  Invitation Date determine (b) is chargeable to tax in respect of his office
  or employment under Schedule E and (c) is not ineligible to participate
  in the Scheme by virtue of any of the provisions of the Act including in
  particular paragraph 8 of Schedule 12A provided that the Board may treat
  any employee or director of a member of the Group who meets requirement (c)
  above as an Eligible Employee PROVIDED HOWEVER THAT at the Invitation Date no
  notice of termination of such employment has been served by either the
  employee concerned or his employing Participating Company;

  
	
   

  	
   

  	
   

  
	
  “Exercise Price”

  	
   

  	
  the price per Share in pounds Sterling at
  which a Participant may acquire Shares pursuant to the Scheme (as determined
  in accordance with Rule 5);

  
				

 

2

 

	
  “Group”

  	
   

  	
  the Company and its Subsidiaries from
  time to time together with any such company as the Board and the Revenue
  Commissioners shall have agreed may participate;

  
	
   

  	
   

  	
   

  
	
  “Invitation Date”

  	
   

  	
  the date upon which invitations to apply
  for Options are issued by the Board, being a date within forty-two days after
  the Commencement Date and thereafter within twenty-eight days after the date
  of public announcement of the annual or half yearly results of the Group;

  
	
   

  	
   

  	
   

  
	
  “London Stock Exchange”

  	
   

  	
  London Stock Exchange Limited;

  
	
   

  	
   

  	
   

  
	
  “Option”

  	
   

  	
  a right granted pursuant to the Scheme to
  acquire Shares;

  
	
   

  	
   

  	
   

  
	
  “Participant”

  	
   

  	
  a person who holds a Subsisting Option or
  (where the context admits) his personal representatives;

  
	
   

  	
   

  	
   

  
	
  “Participating Company”

  	
   

  	
  any member of the Group which the Board
  has designated as a member of the Scheme for the time being;

  
	
   

  	
   

  	
   

  
	
  “Repayment”

  	
   

  	
  in relation to a Savings Contract, the
  amount of the contributions repayable and, where relevant, of any bonus
  and/or interest payable on the termination of the Savings Contract;

  
	
   

  	
   

  	
   

  
	
  “Savings Contract”

  	
   

  	
  a certified contractual savings scheme
  within the meaning of Section 519C(4) of the Act with a qualifying
  savings institution as defined in Section 519C(1) of the Act;

  
	
   

  	
   

  	
   

  
	
  “Schedule 12A”

  	
   

  	
  Schedule 12A to the Act;

  

 

3

 

	
  “Scheme”

  	
   

  	
  the Imperial Tobacco Group Irish
  Sharesave Scheme as amended from time to time;

  
	
   

  	
   

  	
   

  
	
  “Share”

  	
   

  	
  a fully paid ordinary share in the
  capital of the Company which satisfies paragraphs 11 to 15 of Schedule 12A;

  
	
   

  	
   

  	
   

  
	
  “Specified Age”

  	
   

  	
  the age of 60 years;

  
	
   

  	
   

  	
   

  
	
  “Subsidiary”

  	
   

  	
  a subsidiary of the Company as defined in
  Section 155 the Companies Act 1963 over which the Company has Control;

  
	
   

  	
   

  	
   

  
	
  “Subsisting Option”

  	
   

  	
  an Option to the extent that it has
  neither lapsed nor been exercised;

  
	
   

  	
   

  	
   

  
	
  “Trustee”

  	
   

  	
  the trustee or trustees for the time
  being of any employee trust established by the Company wholly or partly for
  the benefit of all or most of the persons for the time being employed or
  holding office with the Group or any Participating Company or Companies which
  has been designated by the Board as a trust out of which Options may be
  granted.

  

 

Where the context so permits the singular
shall include the plural and vice versa and the masculine gender shall include
the feminine.  Any reference to a
statutory provision includes a reference to that provision as for the time
being amended or re-enacted.

 

2.                                       Commencement and Title

 

The Scheme shall commence on the
Commencement Date and shall be known as The Imperial Tobacco Group Irish
Sharesave Scheme.

 

3.                                       Grant of Options

 

(A)                              On or
prior to an Invitation Date the Board (or the Trustee) may decide in its
absolute discretion:-

 

(i)                                     whether
to invite applications for the grant of Options; and

 

4

 

(ii)                                  whether
to invite applications for three year Options, five year Options or seven year
Options (or whether to offer Eligible Employees a choice).

 

(B)                                Where
applications for the grant of Options are invited, such invitations shall be
sent to all Eligible Employees and shall state:-

 

(i)                                     the
Exercise Price or the method by which the Exercise Price for the Shares will be
notified to Eligible Employees;

 

(ii)                                  the
date being the last day of the Application Period by which applications for the
grant of Options must have been received by the Board or such person as the
Board may direct being not less than 14 nor more than 21 days after the date of
issue of such invitations except in exceptional circumstances as determined by
the Board; and

 

(iii)                               whether
application may be made for three year Options, five year Options, seven year
Options or any combination of them.

 

PROVIDED THAT any accidental failure or
omission to deliver invitations to all Eligible Employees shall not invalidate
the grant of Options pursuant to this Rule 3(B) to which such invitations
relate.

 

(C)                                Applications
for Options under the Scheme shall be in such form as the Board may require and
each:-

 

(i)                                     must
be accompanied by a duly completed application form to enter into one or more
Savings Contracts under each of which the applicant will agree to make such
specified contributions being not less than €12 per month nor (when aggregated
with contributions made under any other savings contract linked to a savings
related share option scheme approved under Schedule 12A) more than the
lower of S 320 or Stg£250 per month (or such other amounts as may from time to
time be permitted under the Act and the Savings Contract) as shall secure on
the Bonus Date, as nearly as may be, Repayments of an amount equal to that for
which Shares may be acquired under his Option if exercised in full; and

 

(ii)                                  shall
empower the Board (or the Trustee) or any person authorised by it:-

 

(a)                                  to
amend the amount of the specified contribution referred to in Rule 3(C)(i)
above to such lesser sum as shall secure on the Bonus Date, as nearly as may
be, Repayments of an amount equal to that for which Shares may be acquired

 

5

 

by the
Participant in the event that the number of Shares for which an Eligible
Employee applies for an Option has to be reduced in accordance with Rule 3(D)
below;

 

(b)                                 to
deduct from the Participant’s pay such contribution as shall be specified by
the Participant pursuant to Rule 3(C)(i) or as may be amended pursuant to Rule
3(C)(ii)(a) above and pay the same on behalf of the Participant in discharge of
the Participant’s obligations under the Savings Contract.

 

(iii)                               must
state whether the applicant wishes any bonus payable under the Savings Contract
to be included in the amount of the Repayment which may be used to exercise the
Option.

 

(D)                               Within
thirty days or, in exceptional circumstances, such longer period as may have
been previously agreed in writing with the Revenue Commissioners, of the date
pursuant to Rule 5(A)(i) by reference to which the Exercise Price was determined
or in a case where the number of shares over which Options are to be granted is
determined by Rule 3(D) (ii) below, within forty-two days of such date and
subject to the limitations and conditions contained in the Scheme, Options
shall by resolution of the Board (or the Trustee) be granted to the Eligible
Employees who have applied for them in accordance with the following
provisions:-

 

(i)                                     Options
shall be granted to the Eligible Employees in respect of all the Shares applied
for by them; save that

 

(ii)                                  where
the Board in its discretion considers that it is desirable to limit the number
of Shares in respect of which Options are granted in relation to any
invitation, then the following steps shall be carried out successively to the
extent necessary to eliminate the excess over the limitation imposed

 

(a)                                  the
excess over €12 of the monthly savings contribution chosen by each applicant
shall be reduced pro rata to the extent necessary;

 

(b)                                 applications
will be selected by lot, each based on a monthly savings contribution of  €12 and the inclusion of no bonus in the
Repayment under the Savings Contract.

 

6

 

(E)                                 No
payment will be required from a Participant on the grant of an Option.  Each Participant will be issued with a
certificate.

 

(F)                                 No
Option shall be capable of being transferred by a Participant.

 

(G)                                No
Option shall be granted more than ten years after the 2nd February, 1999.

 

(H)                               The
number of Shares over which an Option is granted to any Eligible Employee must
be so limited that the aggregate of the Exercise Price for those Shares does
not exceed the Repayment under the Savings Contract entered into on the grant
of such Option.

 

(I)                                    In
determining the number of Shares over which an Option will be granted the
Repayment will be converted to pounds Sterling at the exchange rate prevailing
as at the date on which the exercise price is fixed in accordance with Rule
5(A) (i) or, where appropriate, for the purposes of Rule 5(B), as at such date
as is agreed in writing with the Revenue Commissioners.

 

4.                                       Limitations on
the issue of Shares

 

Subject to Rule 6 below, no Option shall be
granted on any Date of Grant or proposed Date of Grant if, as a result:-

 

(A)                              the
total number of Shares issued or committed to be issued during the ten years
preceding such Date of Grant under this Scheme and under all other employee
share schemes established by the Company would exceed 10% of the issued
ordinary share capital of the Company on that Date of Grant; or

 

(B)                                the
total number of Shares issued or committed to be issued during the preceding
five years under the Scheme and under all other employee share schemes
established by the Company would exceed 5% of the issued ordinary share capital
of the Company on that Date of Grant;

 

PROVIDED  that,
for the avoidance of doubt, Shares which shall have been the subject of Options
which have lapsed shall not be taken into account for the purposes of this Rule
4.

 

5.                                       Exercise Price

 

(A)                              Subject
to Rule 6 below the Exercise Price shall be such amount as the Board shall
determine being an amount not less than the greater of:-

 

7

 

(i)                                     subject
to Rule 5(B), eighty per cent. of the middle market quotation per Share as
derived from the Daily Official List of the London Stock Exchange for the dealing
day immediately preceding the Invitation Date; and

 

(ii)                                  in
the case of an Option to subscribe for Shares, the nominal value of a Share.

 

(B)                                For
the purposes of an Option granted at any other time at which there shall be no
dealings in the Shares, the Exercise Price shall be not less than eighty per
cent. of such sum as may be agreed in writing by the Revenue Commissioners in
advance for the purposes of the Scheme to be the market value of a Share in
accordance with Section 548 of the Act.

 

6.                                       Adjustment of Options

 

In the event of any variation in the share
capital of the Company whether by way of capitalisation of profits or reserves
or by way of rights or any consolidation or sub-division or reduction of
capital, or otherwise, then the number of Shares subject to any Subsisting
Option and the Exercise Price may be adjusted by the Board in such manner and
with effect from such date as the Board may determine to be appropriate
provided always that:-

 

(A)                              any such
adjustment shall not take effect without the prior approval in writing of the
Revenue Commissioners;

 

(B)                                no
such adjustment shall take effect until it has been referred to the Auditors
and the Auditors have certified in writing to the Board that the adjustment is
fair and reasonable in their opinion;

 

(C)                                the
Exercise Price of an Option to subscribe for Shares shall not be adjusted below
the nominal value of a Share (unless the Company in general meeting shall
resolve to pay up any part of that nominal value out of distributable
reserves).

 

7.                                            Exercise of Options

 

(A)                              An
Option shall be exercisable during the period mentioned in Rule 7(C) below in
respect of all or some of the Shares over which it was granted by the
Participant forwarding written details specifying the number of Shares in
respect of which the Option is exercised, a remittance in pounds Sterling for
that number of Shares calculated by reference to the Exercise Price and
evidence of the amount of the Repayment under the Savings Contract.  The date of exercise of the Option shall be
the date of receipt by the Company of such notice and payment.

 

8

 

(B)                                It is
a condition of the exercise of an Option under the Scheme that payment for the
Shares shall be made only with monies not exceeding the amount of the Repayment
to the Participant under the Savings Contract to which he has contributed in
relation to the Option.  If upon the
exercise of an Option the Repayment then due to a Participant under his Savings
Contract is less than the amount required to pay for all the Shares in respect
of which it is purportedly exercised, the Option shall be treated as exercised
only in respect of such number of Shares as may be acquired by the amount of
the Repayment and shall lapse as to the excess.

 

(C)                                Save
as otherwise provided, an Option may not be exercised until the Bonus
Date.  Subject only to the provisions of
Rule 7(G) below, no Option may be exercised later than six months after the
Bonus Date.

 

(D)                               Notwithstanding
any other provision hereof no Option may be exercised at any time when the
person seeking to exercise it is excluded from participation in this Scheme by
virtue of either of paragraphs 8 and 9 of Schedule 12A.

 

(E)                                 (i)                                          An Option shall cease to be exercisable upon the Participant ceasing
to be an employee or director of any member of the Group (so as to hold no such
employment or office) except where his so ceasing is by reason of:-

 

(a)                                  his
retirement on reaching the Specified Age; or

 

(b)                                 injury,
disability or redundancy within the meaning of the Redundancy Payments Acts
1967 - 1991 or his office or employment either being in a company which ceases
to be a Subsidiary or relating to a business or part of a business which is
transferred to a person who or which is neither a Subsidiary nor a
Participating Company; or

 

(c)                                  his
leaving service at any time other than at a time specified in Rule 7(E)(i)(a)
or (b) above, provided that such event occurs not earlier than three years from
the Date of Grant of the Option;

 

in any of
which circumstances the Option may be exercised at any time during the period
of six months from the date on which he so ceases to be an employee or director
of any member of the Group notwithstanding that the Bonus Date shall not have
occurred.

 

9

 

(ii)                                  If,
at the Bonus Date, a Participant holds an office or employment in a company
which is not a Participating Company but which is:-

 

(a)                                  an
Associated Company of the Company, or

 

(b)                                 a
company of which the Company has Control,

 

the Participant may exercise his Option
within six months of that Bonus Date.

 

(F)                                 For
the purposes of Rule 7(E) above and Rule 9 below (but for no other purpose):-

 

(i)                                     a
Participant shall not be regarded as ceasing to hold office or employment by
reason of:-

 

(a)                                  his
being or becoming employed by a company which ceases to be or is not a
Participating Company but is nevertheless an Associated Company or is under the
Control of the Company; or

 

(b)                                 his
ceasing to be employed full-time but continuing to be employed on a part-time
basis; and

 

(ii)                                  a
Participant shall be regarded as ceasing to hold office or employment when he
holds no employment with the Company, any Associated Company and any company
Controlled by the Company.

 

(G)                                In the
event of the death of a Participant prior to the Bonus Date the Option may be
exercised by his personal representatives at any time during the period of
twelve months commencing on the date of his death (but not later) and the
personal representatives shall be entitled to do so notwithstanding that the
Bonus Date has not occurred and in the event of the death of a Participant
within six months commencing on the Bonus Date his personal representatives may
exercise the Option at any time within twelve months commencing on the Bonus
Date PROVIDED THAT such personal representatives shall not be entitled to
exercise the Option if at the date of the Participant’s death the Participant
was precluded from exercising the Option by reason of either of paragraphs 8
and 9 of Schedule 12A.

 

(H)                               A
Participant who reaches the Specified Age prior to the Bonus Date but continues
to hold the office or employment by virtue of which he is eligible to
participate in the Scheme may exercise the Option within six months after the
date of his reaching the Specified Age.

 

10

 

(I)                                    If
an Option becomes exercisable under any provision of the Scheme before the
Bonus Date it shall be exercisable only over the number of Shares the aggregate
Exercise Price of which equals (as nearly as may be) but does not exceed the
Repayment made under the Savings Contract entered into on the grant of that
Option but excluding any contributions made directly by the Participant except
to the extent that such are (i) made pursuant to any special arrangements
relating to absence from employment; or (ii) made at the same rate of
contribution and at the same intervals as those contributions previously
deducted from his salary pursuant to the provisions of Rule 3(C)(ii)(b) between
the date of the Participant ceasing to be employed by the Group and the date on
which the Option is exercised; and the Option shall cease to be exercisable
over any Shares in excess of that number in respect of which it was granted.  For the avoidance of doubt, any Repayment
under the Savings Contract shall exclude the Repayment of any contributions
made in advance under the Savings Contract the due date for payment of which
falls or would have fallen more than one month after the date on which
Repayment is made.

 

(J)                                   An
Option shall be exhausted and automatically cancelled immediately after it is
first exercised notwithstanding that it shall not have been exercised in
respect of all of the Shares over which the Option was granted.

 

8.                                       Lapse of Options

 

A Participant’s Option shall lapse and
cease to be exercisable:-

 

(A)                              upon the
expiry of any of the periods for exercise under the provisions of Rule 7 (with
the exception of paragraph (H) thereof) above and Rule 9 below, whichever shall
first occur; or

 

(B)                                if the
Participant omits seven or more times to make a monthly payment due under his
Savings Contract or gives notice under the Savings Contract requiring Repayment
before the Bonus Date unless such non-payment or notice is in consequence of
his ceasing to be an Eligible Employee by virtue of one of the causes mentioned
in Rule 7 paragraphs (E) (G) or (H) above or in the circumstances of Rule 9
below.

 

9.                                       Take-over and
Liquidation

 

(A)                              If any
person obtains Control of the Company as a result of making:-

 

(i)                                     a
general offer to acquire the whole of the issued share capital of the Company
which is made on a condition such that if it is satisfied the person making the
offer will have Control of the Company; or

 

11

 

(ii)                                  a
general offer to acquire all the shares in the Company which are of the same
class as the Shares;

 

then any Subsisting Option may subject to
paragraph (D) below be exercised within six months of the time when the person
making the offer has obtained Control of the Company and any condition subject
to which the offer is made has been satisfied.

 

(B)                                If
under Section 425 of the Companies Act 1985 of the United Kingdom The
Court sanctions a compromise or arrangement proposed for the purposes of or in
connection with a Scheme for the reconstruction of the Company or its
amalgamation with any other company or companies, any Subsisting Option may
subject to paragraph (D) below be exercised within six months of the Court
sanctioning the compromise or arrangement.

 

(C)                                If any
person becomes bound or entitled to acquire shares in the Company under
Sections 428 to 430 of the Companies Act 1985 any Subsisting Option may subject
to paragraph (D) below be exercised at any time when that person remains so
bound or entitled.

 

(D)                               If as a
result of the events specified in paragraphs (A) or (B) above a company has
obtained Control of the Company, or if a company has become bound or entitled
as mentioned in paragraph (C) above, any Participant may by agreement with that
other company (the “Acquiring Company”) within the Appropriate Period [as
defined in paragraph 16(2) of Schedule 12A] release any Subsisting Option
of his in consideration of the grant of a new Option (the “New Option”) which
satisfies the following conditions:-

 

(i)                                     the
New Option shall be over shares in the Acquiring Company or another company
which satisfies paragraph (b) or (c) of Paragraph 11 of Schedule 12A in
relation to the Acquiring Company and shall satisfy the conditions specified in
paragraphs 11 to 15 inclusive of Schedule 12A;

 

(ii)                                  the
New Option shall be a right to acquire such number of such shares in the
Acquiring Company (or such other company) as shall have on the grant of the New
Option an aggregate market value equal to the aggregate market value of the
Shares subject to the Option immediately before its release and for this
purpose market value shall be ascertained by the application of Rule 5(A) as at
the date of release of the Option and grant of the New Option;

 

(iii)                               the New
Option shall have an Exercise Price such that the aggregate price payable on
complete exercise equals the aggregate price which would have been payable on
complete exercise of the Option; and

 

12

 

(iv)                              the New
Option shall be otherwise identical in terms to the Option

 

AND the New
Option shall, for all other purposes of this Scheme, be treated as having been
acquired at the same time as the Option in consideration of the release of
which it is granted.  With effect from
the release of any Option pursuant to this Rule 9, Rules 6, 7(A) and (B), this
Rule 9 and Rule 10 of this Scheme shall in relation to the New Option be
construed as if references therein to “the Company” were references to the
Acquiring Company or, as the case may be, such other company and all the Rules
(other than Rules 3 to 5 inclusive) shall in relation to the New Option be
construed as if references therein to Shares were references to shares in the
Acquiring Company or, as the case may be, such other company in respect of
whose shares the New Option is granted.

 

(E)                                 If
the Company passes a resolution for voluntary winding up, any Subsisting Option
may be exercised within six months of the passing of the resolution.

 

(F)                                 For
the purposes of this Rule 9 other than paragraph (D) above a person shall be
deemed to have obtained Control of a Company if he and others acting in concert
with him have together obtained Control of it.

 

(G)                                The
exercise of an Option pursuant to the preceding provisions of this Rule 9 shall
be subject to the provisions of Rule 7 above.

 

(H)                               Any
Option shall lapse if:-

 

(i)                                     it
shall not have been exercised by the expiry of any time limit for exercise set
out in this Rule 9, whichever shall expire first; and

 

(ii)                                  no
agreement for the release of the Option shall have been entered into by the
expiry of the first Appropriate Period to commence pursuant to paragraph (D)
above.

 

10.                                 Allotment and Listing

 

(A)                              Subject
to receipt of the appropriate remittance:-

 

(i)                                     Shares
to be issued pursuant to the exercise of an Option will be allotted as soon as
practicable after the exercise of the Option and will rank pari passu in all
respects with the Shares in issue on the date of exercise save that they will
not rank for any dividend or other distribution paid or made by reference

 

13

 

to the date
(known as the record date) on which entitlement to the dividend or distribution
is fixed by reference to the Company’s register of members if that date falls
prior to the date of exercise of the Option; and

 

(ii)                                  in
the case of Shares to be transferred pursuant to the exercise of an Option, the
Board or Trustee, as appropriate, shall transfer or procure that the Shares
shall be transferred as soon as practicable after exercise of the Option, save
that such Shares will not rank for any dividend or other distribution paid or
made by reference to the date (known as the record date) on which entitlement
to the dividend or distribution is fixed by reference to the Company’s register
of members if that date falls prior to the date of exercise of the Option.

 

(B)                                If the
Shares are listed on the London Stock Exchange at the date of allotment of any
Shares pursuant to the Scheme the Company will apply to the Council of the
London Stock Exchange for permission for such Shares so allotted to be admitted
to the Official List.  An application may
be postponed at the discretion of the Board until application can be made in
respect of such number of Shares as the Board considers appropriate.

 

11.                                 Employment Rights

 

(A)                              This
Scheme shall not form part of any contract of employment between any member of
the Group and any employee of any such company and the rights and obligations
of any individual under the terms of his office or employment with any member
of the Group shall not be affected by his participation in the Scheme or any
right which he may have to participate therein

 

(B)                                Participation
in the Scheme shall be on the express condition that:-

 

(i)                                     neither
it nor cessation of participation shall afford any individual under the terms
of his office or employment with any member of the Group any additional or
other rights to compensation or damage; and

 

(ii)                                  no
damages or compensation shall be payable in consequence of the termination of
such office or employment (whether or not in circumstances giving rise to a
claim for wrongful or unfair dismissal) or for any other reason whatsoever to
compensate him for the loss of any rights the Participant would otherwise have
had (actual or prospective) under the Scheme howsoever arising but for such
termination; and

 

(iii)                               the
Participant shall be deemed irrevocably to have waived any such rights to which
he may otherwise have been entitled

 

14

 

(C)                                No
individual shall have any claim against a member of the Group arising out of
his not being admitted to participation in the Scheme which (for the avoidance
of any doubt) is governed entirely by the Rules.

 

(D)                               No
Participant shall be entitled to claim compensation from any member of the
Group in respect of any sums paid by him pursuant to the Scheme or for any
diminution or extinction of his rights or benefits (actual or otherwise) under
any Option held by him consequent upon the lapse for any reason of any Option
held by him or otherwise in connection with the Scheme and each member of the
Group shall be entirely free to conduct its affairs as it sees fit without
regard to any consequences under, upon or in relation to the Scheme or any
Option or Participant

 

12.                                 Administration of
the Scheme

 

(A)                              The
Board may make and vary such regulations (not being inconsistent with the
Scheme) as it thinks fit for the administration and implementation of the
Scheme.  The Board’s decision on any
matter concerning the Scheme or its interpretation (other than a matter to be
certified by the auditors of the Company) shall be final and binding.

 

(B)                                The
Board shall be entitled by resolution to amend all or any of the provisions of
the Scheme as the Board thinks fit except that no alteration shall be made:-

 

(i)                                     to
the advantage of Participants without the prior sanction of an ordinary
resolution of the Company in general meeting except for minor amendments to
benefit the administration of the Scheme and amendments to obtain and maintain
favourable tax, exchange control or regulatory treatment for Participants in
the Scheme or for any member of the Group;

 

(ii)                                  to
any rights already accrued to any Participant which would be to the
disadvantage of such Participant, without the prior consent of such
Participant; or

 

(iii)                               in
relation only to Options to purchase Shares, without the prior consent of the
Trustee;

 

unless, in any such case, the alteration is
necessary to comply with any legislation for the time being in force or with
any conditions requisite to obtain or to maintain approval of the Revenue
Commissioners for the Scheme AND provided that, at any time at which the Scheme
is and is intended to remain so approved by the Revenue Commissioners, no
amendment shall take effect

 

15

 

unless and until such amendment shall have
been approved in writing by the Revenue Commissioners.

 

(C)                                Written
notice of any alteration made in accordance with Rule 12(B) shall be given to
all Participants.

 

(D)                               The
Company shall keep available sufficient issued and/or unissued Shares in the
capital of the Company to satisfy the exercise in full of all Options for the
time being remaining capable of being exercised.

 

(E)                                 Participants
shall be sent copies of any document having a material effect on their rights
at the same time as such document is sent to holders of Shares.

 

(F)                                 The
provisions of the Company’s Articles of Association for the time being in force
with regard to the service of notices upon members of the Company shall apply
mutatis mutandis to any notice to be given by the Company to Participants.  Any notice to be given by the Trustee to any
Participant or Eligible Employee shall be sufficiently given if sent to his
home address or place of work as last reported in writing to the Trustee by the
Company.

 

(G)                                Notwithstanding
anything to the contrary contained herein the Board may at any time and from
time to time by resolution and without further formality amend the Scheme in
any way to the extent necessary to render the Scheme capable of approval by the
Revenue Commissioners or any other governmental or other regulatory body
pursuant to any present or future Irish legislation.

 

(H)                               The
cost of the preparation of this Scheme shall be borne by the Irish
Participating Companies in such proportions as are agreed with the Company.

 

(I)                                    The
costs of operation and administration of this Scheme shall be borne by the
Irish Participating Companies in such proportions as are agreed from time to
time with the Company on such basis as determined by the Company.

 

(J)                                   The
Scheme shall be governed by Irish law.

 

13.                                 Termination of the
Scheme

 

The Scheme may
be terminated at any time by the Board or by the Company in general meeting but
in any event shall terminate on 2nd February 2009 such date being the
tenth anniversary of the commencement date of the International Sharesave Plan
and on such

 

16

 

termination no
further Options shall be granted, but the subsisting rights of Participants
shall not be affected by such termination.

 

17

 

 Imperial Tobacco Group plc

IRISH SHARESAVE SCHEME

 

OPTION CERTIFICATE

 

 

	
  Name of Option Holder

  	
   

  	
   

  
	
   

  	
   

  
	
  Address of Option Holder

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
    Post Code

  	
   

  	
   

  
	
   

  	
   

  
	
  Option Certificate number

  	
   

  	
   

  
	
   

  	
   

  
	
  Number of shares granted under this
  option

  	
   

  	
   

  
	
   

  	
   

  
	
  Date of grant

  	
   

  	
   

  
								

 

 

This is to certify that the above named
person was on the above date granted an option as specified for ordinary shares
of [   ]p each in the capital of Imperial Tobacco Group PLC at
an exercise price of [        ]p per
share upon and subject to the terms of the Irish Imperial Tobacco Group PLC
Sharesave Scheme adopted pursuant to a resolution of Imperial Tobacco Group PLC
in general meeting on
[                     ].

 

Signed on behalf of

 

 

	
   

  	
    Director

  	
   

  	
   Secretary

  

 

 

NOTES:                                              (1)                                     The option cannot be assigned or transferred.

 

[(2)                              In order
to exercise your option please send this Option Certificate together with a
request for a cheque for the relevant exercise price of the shares and evidence
of the amount repaid under your Sharesave contract to the [insert name of
savings carrier]  (or such other person
as shall have been notified to you)].  *
To be agreed with savings carrier.

 

THIS DOCUMENT MUST BE RETAINED.  PLEASE KEEP IT IN A SAFE PLACE.  This certificate is issued as a matter of
record only and is not a document of title.

 

18

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