Document:

Exhibit 10.8

     

    
      EXHIBIT
        10.8

    

    
 

    EMPLOYMENT
      AGREEMENT

     

    Employment
      Agreement dated December
      5, 2005
      (the
“Effective
      Date”)
      between Canadian Satellite Radio Inc. (the “Corporation”)
      and
      Michael Washinushi (the “Executive”).

     

    RECITALS

     

    
      	(a)  	
              The
                Executive has been employed by the Corporation since November
                14, 2005 in
                the position of Chief Financial
                Officer;

            

    

     

    
      	(b)  	
              Canadian
                Satellite Radio Holdings Inc. (“CSR
                Holdings”),
                the parent of the Corporation, is conducting a public offering of
                subordinate voting shares of CSR Holdings (the “IPO”);

            

    

     

    
      	(c)  	
              As
                a term of the IPO the Corporation and the Executive are required
                to enter
                into and be bound by the terms of this
                Agreement;

            

    

     

    
      	(d)  	
              As
                a whole, this Agreement contains terms and conditions which are more
                favourable to the Executive than those presently applicable to
                him.

            

    

     

    In
      consideration of the mutual covenants and agreements contained in this Agreement
      (the receipt and adequacy of which are acknowledged), the parties agree as
      follows.

     

     

    
      
        
        

      

      
        1

        
          

        

      

      
        
        

      

    

    ARTICLE 1
      -
      DEFINITIONS

     

    Section 1.1  Defined
      Terms.

     

    As
      used
      in this Agreement, the following terms have the following meanings:

     

    “Business”
means
      (i) the business of providing subscription based satellite radio entertainment;
      and (ii) any other principle line business conducted by the Corporation after
      the Effective Date up to the termination of the Executive's
      employment.

     

    “Cause”
      means:

     

    
      	(a)  	
              a
                breach by the Executive of any of the restrictions or covenants contained
                in Articles 5, 6 and 7;

            

    

     

    
      	(b)  	
              any
                material breach by the Executive of his obligations under any code
                of
                ethics, any other code of business conduct or any lawful policies
                or
                procedures of the Corporation; or

            

    

     

    
      	(c)  	
              any
                act or omission of the Executive which would in law permit the
                Corporation, without notice or payment in lieu of notice, to terminate
                the
                employment of the Executive.

            

    

     

    “Change
      of Control”
      means:

     

    
      	(a)  	
              any
                sale, reorganization, amalgamation, merger or other transaction as
                a
                result of which an Entity or group of Entities acting jointly or
                in
                concert (whether by means of a shareholder agreement or otherwise)
                or
                Entities associated or affiliated with any such Entity or group within
                the
                meaning of the Business
                Corporations Act
                (Ontario), other than Canadian Satellite Radio Investments Inc.,
                John
                Bitove, the Executive and his associates, becomes the owner, legal
                or
                beneficial, directly or indirectly, of fifty (50%) percent or more
                of the
                shares of the Corporation or exercises control or direction over
                fifty
                (50%) percent or more of the shares of the Corporation (other than
                solely
                involving the Corporation and one or more of its affiliates);
                or

            

    

     

    
      	(b)  	
              a
                sale, lease or other disposition of all or substantially all of the
                property or assets of the Corporation other than to an affiliate
                which
                assumes all of the obligations of the Corporation in respect of the
                Executive including the assumption of this Agreement;
                or

            

    

     

    
      	(c)  	
              a
                change in the composition of the Corporation's Board of Directors
                which
                occurs at a single meeting of the shareholders of the Corporation
                or upon
                the execution of a shareholder's resolution, such that individuals
                who are
                independent members of the Board of Directors immediately prior to
                such
                meeting or resolution cease to constitute a majority of the independent
                members of the Board of Directors, without the Board of Directors,
                as
                constituted immediately prior to such meeting or resolution, having
                approved of such change.

            

    

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

    “Confidential
      Information”
means
      all information owned, possessed or controlled by the Corporation and/or its
      affiliates including, without limitation, all information related to
      developments, inventions, enhancements, financial, scientific, technical,
      manufacturing, process know-how and marketing information and all names of
      or
      lists of customers and suppliers howsoever received by the Executive from,
      through or relating to the Corporation and/or its affiliates and in whatever
      form (whether oral, written, machine readable or otherwise), which pertains
      to
      the Corporation and/or its affiliates; provided, however, that the phrase
“Confidential Information” shall not include information which:

     

    
      	(a)  	
              was
                in the public domain prior to the date of receipt by the
                Executive;

            

    

     

    
      	(b)  	
              becomes
                part of the public domain by publication or otherwise, not due to
                any
                unauthorized act or omission of the Executive;
                or

            

    

     

    
      	(c)  	
              the
                Executive is required by law to disclose, provided that, unless prohibited
                by law, the Executive first notifies the Reporting Officer (as defined
                herein) at the first reasonable opportunity that he is required to
                disclose such Confidential
                Information.

            

    

     

    “Customer”
means
      any Entity who has (i) purchased or licensed from the Corporation (with the
      Executive's knowledge) any product produced or service supplied, sold, licensed
      or distributed by the Corporation or, (ii) supplied to the Corporation (with
      the
      Executive's knowledge) any product to be produced, sold, licensed or distributed
      by the Corporation; provided that after the termination of the Executive's
      employment for any reason, Customers shall only include any Entity who was
      a
      Customer during the twelve (12) months preceding the date of the termination
      of
      the Executive's employment.

     

    “Development”
means
      any discovery, invention, design, improvement, concept, specification, creation,
      development, treatment, computer program, method, process, apparatus, specimen,
      formula, formulation, product, hardware or firmware, any drawing, report,
      memorandum, article, letter, notebook and any other work of authorship and
      ideas
      (whether or not patentable or copyrightable) and legally recognized proprietary
      rights (including, but not limited to, patents, copyrights, trademarks,
      topographies, know-how and trade secrets), and all records and copies of records
      relating to the foregoing, that:

     

    
      	(a)  	
              result
                or derive from the Executive's employment or from the Executive's
                knowledge or use of Confidential
                Information;

            

    

     

    
      	(b)  	
              are
                conceived or made by the Executive (individually or in collaboration
                with
                others) in the course of his
                employment;

            

    

     

    
      	(c)  	
              result
                from or derive from the use or application of the resources of the
                Corporation; or

            

    

     

    
      	(d)  	
              relate
                to the business operations of actual or demonstrably anticipated
                research
                and development by the Corporation.

            

    

     

    “Disability”
means
      the Executive's inability to substantially fulfil his duties on behalf of the
      Corporation for a continuous period of six (6) months or more or the Executive's
      inability to substantially fulfil his duties on behalf of the Corporation for
      an
      aggregate period of six (6) months or more during any consecutive twelve (12)
      month period, which the parties agree would cause undue hardship to the
      Corporation which cannot be accommodated; and if there is any disagreement
      between the Corporation and
      the
      Executive as to the Executive's Disability or as to the date any such Disability
      began or ended, the same shall be determined by a physician mutually acceptable
      to the Corporation and the Executive whose determination shall be conclusive
      evidence of any such Disability and of the date any such Disability began or
      ended.

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

    “Entity”
means
      a
      natural person, partnership, limited liability partnership, corporation, joint
      stock company, trust, unincorporated association, joint venture or other entity
      or governmental entity, and pronouns have a similarly extended
      meaning.

     

    “Good
      Reason”
means
      constructive dismissal in accordance with the common law, provided, however
      that
      the following shall not constitute Good Reason for, the purposes of this
      Agreement:

     

    
      	(a)  	
              any
                change or series of changes in the responsibilities, authority, status
                or
                reporting relationship of the Executive with the Corporation during
                the
                first eighteen (18) months from the Effective Date;
                or

            

    

     

    
      	(b)  	
              a
                reduction by the Corporation in the Executive's annual Base Salary
                which
                is part of a general reduction in the Base Salary of all or substantially
                all of the senior executives of the Corporation
                which:

            

    

     

    
      	(i)  	
              occurs
                during the first eighteen (18) months from the Effective
                Date;

            

    

     

    
      	(ii)  	
              affects
                the Executive in substantially the same manner as the other senior
                executives who are also affected by such general reduction;
                and

            

    

     

    
      	(iii)  	
              does
                not constitute more than fifteen percent (15%) of his Base Salary;
                or

            

    

     

    
      	(c)  	
              any
                requirement by the Corporation that the Executive's principal office
                be
                relocated to any major urban centre in Canada, provided the Corporation
                reimburses the Executive for all reasonable relocation
                expenses.

            

    

     

    “Intellectual
      Property Rights”
means
      all worldwide intellectual and industrial property rights in connection with
      the
      Developments including, without limitation:

     

    
      	(i)  	
              patents,
                inventions, discoveries and
                improvements;

            

    

     

    
      	(ii)  	
              ideas,
                whether patentable or not;

            

    

     

    
      	(iii)  	
              copyrights;

            

    

     

    
      	(iv)  	
              trademarks;

            

    

     

    
      	(v)  	
              trade
                secrets;

            

    

     

    
      	(vi)  	
              industrial
                and artistic designs; and

            

    

     

    
      	(vii)  	
              proprietary,
                possessory and ownership rights and interests of all kinds
                whatsoever;

            

    

     

    including,
      without limitation, the right to apply for registration or protection of any
      of
      the foregoing.

     

    “Prospective
      Customers”
means
      (i) any Entity solicited by the Executive on behalf of the Corporation for
      any
      purpose relating to the Business, and (ii) any Entity solicited by the
      Corporation with the Executive's knowledge for any purpose relating to the
      Business; provided that after termination of the Executive's employment for
      any
      reason, Prospective Customers shall only include any Entity who was a
      Prospective Customer during the twelve (12) months preceding the date of the
      termination of the Executive's employment.

     

    “Territory”
means
      Canada.

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    ARTICLE 2
      -
      EMPLOYMENT

     

    Section 2.1  Position

     

    On
      the
      terms and subject to the conditions hereinafter contained, the Executive will
      continue in the employ of the Corporation as its Chief Financial
      Officer.

     

    Section 2.2  Duties
      of Employment

     

    The
      Executive shall report to and be subject to the general direction of the Chief
      Executive Officer of the Corporation (the “Reporting
      Officer”)
      and
      shall have such duties and responsibilities as are delegated to him by the
      Reporting Officer.

     

    Section 2.3  Full
      and Faithful Service

     

    The
      Executive shall well and faithfully serve the Corporation and use his best
      efforts to promote the interests of the Corporation and during the term of
      this
      Agreement, the Executive shall devote his full time and energy to the
      Corporation and shall not, directly or indirectly, render services to any Entity
      other than services with regard to charitable or community service
      organizations, or any other organizations that are approved by the Corporation,
      provided such activities do not interfere with Executive's duties hereunder.
      The
      Executive further acknowledges that he will comply with (i) the lawful policies
      and procedures established by the Corporation, from time to time, including
      any
      code of ethics or business conduct adopted by the Corporation (including any
      future revisions of such policies, procedures or other codes of business
      conduct), and (ii) all applicable laws, rules and regulations, and all
      requirements of all applicable regulatory, self-regulatory and administrative
      bodies.

     

    Section 2.4  Term

     

    This
      Agreement shall be effective from the Effective Date and shall continue in
      effect until the date the Agreement is terminated in accordance with
Article 4
      hereof.

     

     

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

     

    
      ARTICLE 3
        -
        REMUNERATION AND BENEFITS 

    

    Section 3.1  Salary

     

    The
      Corporation shall pay to the Executive a salary (the “Base
      Salary”)
      at the
      rate of $250,000 per annum, payable to the Executive in accordance with the
      payroll practices of the Corporation for its senior management as are in effect
      from time to time. The Executive's Base Salary may be increased by the Reporting
      Officer from time to time and once increased shall thereafter be the Base Salary
      hereunder.

     

    Section 3.2  Bonus

     

    The
      Executive shall be eligible to participate in the Corporation's bonus plan
      for
      senior management (the “Bonus
      Plan”)
      in
      accordance with the terms and conditions of such plan. Such participation shall
      be at a level such that the Executive shall have the potential to receive,
      at
      target, a bonus of up to 40% of his Base Salary with a maximum bonus of up
      to
      60% of his Base Salary based on achievement of the goals established pursuant
      to
      the Bonus Plan.

     

    Section 3.3  Stock
      Options

     

    The
      Executive shall, subject to the terms and conditions of the stock option plan
      of
      the Corporation adopted in 2005 (as same may be amended from time to time),
      participate in such plan as determined by the Board of Directors of the
      Corporation.

     

    Section 3.4  Health
      and Insurance Benefits

     

    The
      Executive shall be eligible to participate in such health, medical, dental,
      disability and life insurance coverage as the Corporation has in effect for
      its
      senior management from time to time.

     

    Section 3.5  Expenses

     

    The
      Corporation will pay or reimburse the Executive for all reasonable travelling
      and other out-of-pocket expenses incurred by the Executive in connection with
      his employment hereunder in accordance with the policies of the Corporation
      in
      effect from time to time.

     

    Section 3.6  Vacation

     

    During
      each full calendar year of this Agreement, the Executive will be entitled to
      four (4) weeks vacation with pay to be taken at a time(s) mutually agreeable
      to
      the Executive and the Corporation. The Executive will be allowed to carry
      forward any unused vacation time into the next year to the extent same is
      permitted by the policies of the Corporation or by the Reporting
      Officer.

     

     

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

    ARTICLE 4
      -
      TERMINATION 

     

    Section 4.1  Termination
      by the Corporation

     

    This
      Agreement and the employment contemplated hereunder may (and in the case of
      Subsection 4.1(d), shall) be terminated, at any time, in the following manner
      and in the following circumstances:

     

    
      	(a)  	
              by
                the Executive, by providing four (4) weeks written notice of resignation
                to the Corporation (the “Notice
                of Resignation Period”),
                in which case, subject to Section 4.1(b),
                this Agreement and the Executive's employment shall terminate at
                the end
                of the Notice of Resignation
                Period;

            

    

     

    
      	(b)  	
              during
                the Notice of Resignation Period, the Corporation may waive such
                Notice of
                Resignation Period, in whole or in part, in which case this Agreement
                and
                the Executive's employment shall terminate immediately upon receipt
                by the
                Executive of a written notice from the
                Corporation;

            

    

     

    
      	(c)  	
              by
                the Corporation, for Cause, in which case this Agreement and the
                Executive's employment shall terminate immediately upon receipt of
                a
                written notice by the Executive from the Corporation setting out
                the cause
                for termination;

            

    

     

    
      	(d)  	
              automatically
                without further notice, upon the death of the Executive, in which
                case the
                Executive's employment and this Agreement shall terminate on the
                date of
                the Executive's death;

            

    

     

    
      	(e)  	
              by
                the Corporation, in the event of a material violation of this Agreement
                (other than one constituting Cause) by the Executive where such violation
                has not been cured within ten (10) working days following receipt
                of
                written notice thereof by the Executive from the Corporation. This
                Agreement and the Executive's employment shall terminate ten (10)
                days
                following receipt by the Executive of written notice from the Corporation
                of a material violation of this Agreement (other than a material
                violation
                that constitutes Cause) if such material violation of this Agreement
                has
                not been cured to the satisfaction of the Corporation by the
                Executive;

            

    

     

    
      	(f)  	
              by
                the Corporation, without Cause and other than for the circumstances
                in
                subsection 4.1(b), (d), (e) or (h), in which case this Agreement
                and the
                Executive's employment shall terminate immediately upon receipt by
                the
                Executive of a written notice of termination from the
                Corporation;

            

    

     

    
      	(g)  	
              by
                the Executive, within thirty (30) days of the occurrence of any event
                constituting Good Reason, in which case this Agreement and the Executive's
                employment shall terminate immediately upon receipt by the Executive
                of a
                written notice of termination by the Executive;
                or

            

    

     

    
      	(h)  	
              by
                the Corporation, in the event of frustration of this Agreement due
                to the
                Executive's Disability, in which case this Agreement and the Executive's
                employment shall terminate immediately upon receipt of a written
                notice by
                the Executive from the Corporation.

            

    

     

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

    Section 4.2  Payment
      Upon Termination

     

    In
      the
      event the Executive's employment is terminated pursuant to Section 4.1,
      the
      Executive shall only be entitled to the following compensation and benefits
      upon
      termination:

     

    
      	(a)  	
              Should
                this Agreement be terminated pursuant to Subsection 4.1(a) or (b),
                the
                Executive shall only be entitled to (i) payment of the Executive's
                Base
                Salary for the period from the date of termination by the Corporation
                to
                the end of the Notice of Resignation Period; (ii) continued health
                and
                welfare insurance benefits coverage in which the Executive was
                participating at the date of termination by the Corporation to the
                end of
                the Notice of Resignation Period; (iii) the value of the pro-rated
                vacation leave with pay for that portion of the calendar year up
                to the
                end of the Notice of Resignation Period and any vacation from previous
                years carried forward in accordance with Section 3.6
                of
                this Agreement, to the extent the Executive's accrued vacation entitlement
                has not been used by him at the time of termination; (iv) any accrued
                but
                unpaid business expenses at the date of termination by the Corporation
                required to be reimbursed under Section 3.5
                of
                this Agreement; and (v) any entitlements in accordance with the terms
                of
                any stock option plans in which he participated at the date of
                termination.

            

    

     

    
      	(b)  	
              Should
                this Agreement be terminated pursuant to Subsection 4.1(c) or (e),
                the
                Executive shall only be entitled to (i) payment of the Executive's
                Base
                Salary earned up to the date of termination; (ii) the value of the
                pro-rated vacation leave with pay for that portion of the calendar
                year in
                which the employment of the Executive hereunder is terminated that
                the
                Executive was actively employed and any vacation from previous years
                carried forward in accordance with Section 3.6
                of
                this Agreement, to the extent the Executive's accrued vacation entitlement
                has not been used by him at the time of termination; and (iii) any
                accrued
                but unpaid business expenses at the date of termination required
                to be
                reimbursed under Section 3.5
                of
                this Agreement.

            

    

     

    
      	(c)  	
              Should
                this Agreement be terminated pursuant to Subsection 4.1(d) or 4.1(h),
                the
                Corporation's only obligations shall be
                to:

            

    

     

    
      	(i)  	
              pay
                to the Executive (w) any accrued but unpaid Base Salary for services
                rendered to the date of termination; (x) a bonus for that portion
                of the
                year in which the Executive was actively employed; (y) any accrued
                but
                unpaid expenses at the date of termination required to be reimbursed
                under
                Section 3.5
                of
                this Agreement; and (z) the value of the pro-rated vacation leave
                with pay
                for that portion of the calendar year in which the employment of
                the
                Executive hereunder is terminated that the Executive was actively
                employed
                and any vacation from previous years carried forward in accordance
                with
                Section 3.6
                of
                this Agreement, to the extent the Executive's accrued vacation entitlement
                has not been used by him at the time of termination. The amount of
                the
                bonus payable under this Subsection 4.2(c)(i) shall be calculated
                as
                follows: the product of (s) the average bonus paid to the Executive
                for
                the three (3) fiscal years prior to the fiscal year in which his
                employment is terminated divided by twelve (12), and (t) the number
                of
                months the Executive was actively employed in the fiscal year in
                which his
                employment is terminated. In the event the Executive's employment
                is
                terminated in the first twelve (12) months following the Effective
                Date,
                the value of such bonus shall be calculated as follows: the product
                of (s)
                the target bonus (40% of Base Salary) that the Executive would have
                been
                entitled to receive in the year his employment was terminated, divided
                by
                twelve, and (t) the number of months the Executive was actively employed
                in the fiscal year in which his employment is
                terminated;

            

    

     

     

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	(ii)  	
              pay
                to the Executive an amount equal to six (6) months of his Base Salary
                as
                at the date of termination, to be paid either by lump sum within
                thirty
                days of the date of termination or by way of salary continuance on
                the
                Corporation's regular pay day, and in accordance with its payroll
                practices at the date of termination, as is determined by the
                Corporation;

            

    

     

    
      	(iii)  	
              pay
                to the Executive an amount in lieu of the value of any annual bonus
                the
                Executive would have earned had he been employed for the six (6)
                months
                immediately following the date of termination. Such amount shall
                be paid
                six (6) months following the date of termination and shall be the
                average
                bonus (excluding any retention bonus) paid to the Executive for the
                three
                (3) fiscal years prior to the fiscal year in which his employment is
                terminated divided by two (2). In the event the Executive's employment
                is
                terminated in the first twelve (12) months following the Effective
                Date,
                the value of such bonus shall be the target bonus (40% of Base Salary)
                that the Executive would have been entitled to receive in the year
                his
                employment was terminated divided by two (2);
                and

            

    

     

    
      	(iv)  	
              continue
                the Executive's entitlements in accordance with the terms of any
                stock
                option plans in which he participated at the date of
                termination.

            

    

     

    
      	(d)  	
              Should
                the Agreement be terminated pursuant to Subsection 4.1(f) or 4.1(g),
                the
                Corporation's only obligations shall be
                to:

            

    

     

    
      	(i)  	
              pay
                to the Executive (w) any accrued but unpaid Base Salary for services
                rendered to the date of termination; (x) a bonus for that portion
                of the
                year in which the Executive was actively employed (excluding the
                Notice
                Period); (y) any accrued but unpaid expenses at the date of termination
                required to be reimbursed under Section 3.5
                of
                this Agreement; and (z) the value of the pro-rated vacation leave
                with pay
                for that portion of the calendar year in which the employment of
                the
                Executive hereunder is terminated that the Executive was actively
                employed
                and any vacation from previous years carried forward in accordance
                with
                Section 3.6
                of
                this Agreement, to the extent the Executive's accrued vacation entitlement
                has not been used by him at the time of termination. The amount of
                the
                bonus payable under this Subsection 4.2(d)(i) shall be calculated
                as
                follows: the product of (s) the average bonus paid to the Executive
                for
                the three (3) fiscal years prior to the fiscal year in which his
                employment is terminated divided by twelve (12), and (t) the number
                of
                months the Executive was actively employed (excluding the Notice
                Period)
                in the fiscal year in which his employment is terminated. In the
                event the
                Executive's employment is terminated in the first twelve (12) months
                following the Effective Date, the amount of the bonus payable hereunder
                shall be calculated as follows: the product of (s) the target bonus
                (40%
                of Base Salary) that the Executive would have been entitled to receive
                in
                the year his employment was terminated divided by twelve (12), and
                (t) the
                number of months the Executive was actively employed (excluding the
                Notice
                Period) in the fiscal year in which his employment is
                terminated;

            

    

     

    
      	(ii)  	
              pay
                to the Executive an amount equal to twelve (12) months (the “Notice
                Period”)
                of his Base Salary as at the date of termination. Payment of the
                Executive's Base Salary during the Notice Period shall be made either
                by
                lump sum within thirty days of the date of termination or by way
                of salary
                continuance on the Corporation's regular pay day, and in accordance
                with
                its payroll practices at the date of termination, as is determined
                by the
                Corporation;

            

    

     

    
      	(iii)  	
              pay
                to the Executive an amount in lieu of the value of any annual bonus
                the
                Executive would have earned had he been employed for the length of
                the
                Notice Period. Such amount shall be paid at the end of the Notice
                Period
                and shall be calculated as follows: the product of (s) the average
                bonus
                (excluding any retention bonus) paid to the Executive for the three
                (3)
                fiscal years prior to the fiscal year in which his employment is
                terminated divided by twelve (12), and (t) the number of months in
                the
                Notice Period. In the event the Executive's employment is terminated
                in
                the first twelve (12) months following the Effective Date, the value
                of
                such bonus shall be calculated as follows: the product of (s) the
                target
                bonus (40% of Base Salary) that the Executive would have been entitled
                to
                receive in the year his employment was terminated divided by twelve
                (12),
                and (t) the number of months in the Notice
                Period;

            

    

     

    
      	(iv)  	
              continue
                the Executive's participation in the health and welfare benefit plans
                (excluding short-term disability, long term disability benefits and
                life
                insurance coverage which shall cease on the date of termination)
                in which
                the Executive was participating at the date of termination, until
                the
                earlier of (x) the end of the Notice Period; or (y) the date the
                Executive
                becomes covered under the benefit plans of another employer. The
                Corporation's obligation hereunder is conditional on the Executive
                continuing to pay his share of the premiums;
                and

            

    

     

    
      	(v)  	
              continue
                the Executive's entitlements in accordance with the terms of any
                stock
                option plans in which he participated at the date of
                termination.

            

    

     

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

    Section 4.3  Termination
      Upon a Change of Control

     

    In
      lieu
      of and not in addition to the termination payments and benefits provided for
      in
Section 4.2(d)
      herein,
      if within twelve (12) months following a Change of Control, the Executive's
      employment with the Corporation is terminated for any reason whatsoever other
      than as a result of a termination pursuant to Subsection 4.1(a), (b), (c),
      (d),
      (e) or (h), the Corporation's only obligations shall be to:

     

    
      	(a)  	
              pay
                to the Executive (i) any accrued but unpaid Base Salary for services
                rendered to the date of termination, (ii) a bonus for that portion of
                the year in which the Executive was actively employed (excluding
                the
                Change of Control Notice Period, as defined below); (iii) any accrued
                but unpaid expenses at the date of termination required to be reimbursed
                under Section 3.5
                of
                this Agreement, and (iv) the value of the pro-rated vacation leave
                with pay for that portion of the calendar year in which the employment
                of
                the Executive hereunder is terminated that the Executive was actively
                employed and any vacation from previous years carried forward in
                accordance with Section 3.6
                of
                this Agreement, to the extent the Executive's accrued vacation entitlement
                has not been used by him at the time of termination. The amount of
                the
                bonus payable under this Subsection 4.3(a) shall be calculated as
                follows:
                the product of (s) the average bonus paid to the Executive for the
                three
                (3) fiscal years prior to the fiscal year in which his employment
                is
                terminated divided by twelve (12), and (t) the number of months the
                Executive was actively employed (excluding the Change of Control
                Notice
                Period, as defined below) in the fiscal year in which his employment
                is
                terminated. In the event the Executive's employment is terminated
                in the
                first twelve (12) months following the Effective Date, the amount
                of the
                bonus payable hereunder shall be calculated as follows: the product
                of (s)
                the target bonus (40% of Base Salary) that the Executive would have
                been
                entitled to receive in the year his employment was terminated divided
                by
                twelve (12), and (t) the number of months the Executive was actively
                employed (excluding the Change of Control Notice Period, as defined
                below)
                in the fiscal year in which his employment is terminated;
                and

            

    

     

    
      	(b)  	
              pay
                to the Executive those amounts and provide the benefits referenced
                in
                Subsections 4.2(c)(ii), (iii) and (iv) above, calculated as if the
                Notice
                Period was eighteen (18) months (the “Change
                of Control Notice Period”)
                rather than twelve (12) months.

            

    

     

    Section 4.4  Mitigation

     

    The
      Executive shall not be required to mitigate the amount of any payments or the
      entitlement to any benefits provided for under Section 4.2(d) or 4.3 or by
      seeking other employment nor shall any payment or benefit provided for in such
      Section be reduced by any compensation or remuneration and/or benefits earned
      by
      the Executive as a result of employment by another employer or the rendering
      of
      services after the date of termination.

     

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

    Section 4.5  
      Effect of Termination

     

    Upon
      termination of his employment for any reason whatsoever, the Executive shall
      thereupon be deemed to have immediately resigned any position the Executive
      may
      have as an officer, director or employee of the Corporation together with any
      other office, position or directorship which the Executive may hold with any
      of
      the Corporation's affiliates or related entities. In such event, the Executive
      shall, at the request of the Corporation, forthwith execute any and all
      documents appropriate to evidence such resignations. The Executive shall not
      be
      entitled to any payments in respect of such resignations in addition to those
      provided for herein.

     

    Section 4.6  Payment
      Upon Termination

     

    Notwithstanding
      Sections 4.2 and 4.3, the Executive shall not receive less than that which
      he is
      entitled to upon a termination of employment in accordance with applicable
      employment standards legislation. The payments referred to in Subsections
      4.2(c)(ii), 4.2(d)(ii) and 4.3(b) are inclusive of any termination and/or
      severance payments that may be required under employment standards legislation
      and have been agreed upon with reference to the Executive's length of service
      with the Corporation.

     

    Section 4.7  Release

     

    The
      Executive agrees that payment by the Corporation of the amounts set out in
      Subsection 4.2(c), Subsection 4.2(d) or Section 4.3 shall be in full and final
      settlement of any and all actions, causes of actions, suits, claims, demands
      and
      entitlements whatsoever which the Executive has or may have against the
      Corporation, its affiliates and any of their respective directors, officers,
      employees, representatives, successors and assigns arising out of his hiring,
      his employment and the termination of his employment or this
      Agreement.

     

    Section 4.8  Suspension
      or Termination of Benefits and Compensation

     

    In
      the
      event that the Executive has breached any provisions of Section 5, 6, 7 or
      9,
      the Corporation shall have the right to suspend or terminate any or all
      remaining payments and/or benefits, if any, referenced in Sections 4.2(d) and
      4.3(d) of this Agreement, which are over and above the Executive's entitlements
      upon termination of employment mandated by applicable employment standard
      legislation. Such suspension or termination of payments and/or benefits shall
      be
      in addition to and shall not limit any and all other rights and remedies as
      set
      out in Section 10.2
      of this
      Agreement that the Corporation may have against the Executive.

     

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

    ARTICLE 5
      -
      CONFIDENTIAL INFORMATION

     

    Section 5.1  Confidentiality

     

    
      	(1)  	
              During
                the term of this Agreement and following the termination thereof,
                the
                Executive shall not use, divulge, diffuse, sell, transfer, give,
                circulate, or otherwise distribute to any Entity whatsoever or whomsoever,
                or otherwise make public, any Confidential
                Information.

            

    

     

    
      	(2)  	
              Notwithstanding
                any provision of this Agreement to the contrary, the Executive shall
                have
                the right to use Confidential Information in relation to the performance
                of his duties, in which event, the Executive shall, at all times,
                take all
                reasonable measures in order to prevent the disclosure or non-authorized
                use of such Confidential
                Information.

            

    

     

    
      	(3)  	
              Except
                when authorized in accordance with the performance of his duties,
                under no
                circumstances shall the Executive reproduce any Confidential Information
                without the prior written consent of the Reporting Officer. All
                reproductions of Confidential Information shall be governed by this
                Agreement and shall be treated as Confidential Information
                hereunder.

            

    

     

    
      	(4)  	
              The
                Executive shall not publish or release or allow the publication or
                release
                of any material containing Confidential Information without the prior
                written consent of the Reporting
                Officer.

            

    

     

    
      	(5)  	
              The
                Executive shall not install, copy or receive any Confidential Information
                into his own or any other computer or computer system not owned and
                controlled by the Corporation, without the express written permission
                of
                the Corporation. Where an Executive has received permission from
                the Board
                of Directors to so install, copy or receive Confidential Information,
                the
                Executive shall be solely responsible to the Corporation for the
                security
                of such Confidential Information and shall follow any and all directions
                given by the Corporation.

            

    

     

    Section 5.2  Corporation
      Property

     

    Confidential
      Information (including any reproduction thereof) shall remain the sole property
      of the Corporation and shall be returned to the Corporation immediately upon
      request or upon the termination of the Executive's employment, for any
      reason.

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    ARTICLE 6
      -
      NON-COMPETITION

     

    Section 6.1  Non-Competition

     

    The
      Executive shall not, during the term of this Agreement and for a period of
      twelve (12) months following the termination of his employment, for any reason,
      on his own behalf or on behalf of any Entity, whether directly or indirectly,
      in
      any capacity whatsoever, alone, through or in connection with any Entity, carry
      on or be engaged in or have any financial or other interest in or be otherwise
      commercially involved in any endeavour, activity or business in all or part
      of
      the Territory which is competitive, in any way, with the Business.

     

    Section 6.2  Exception

     

    The
      Executive shall, however, not be in default under Section 6.1
      by
      virtue of the Executive holding, strictly for portfolio purposes and as a
      passive investor, no more than one percent (1%) of the issued and outstanding
      shares of or any other interest in, any body corporate which is listed on any
      recognized stock exchange, the business of which body corporate is in
      competition, in whole or in part, with the Corporation.

     

     

    ARTICLE 7
      -
      NON-SOLICITATION

     

    Section 7.1  Non-Solicitation
      of Customers or Employees

     

    The
      Executive shall not, during the term of this Agreement and for a period of
      twelve (12) months following the termination of his employment, for any reason,
      on his own behalf or on behalf of or in connection with any other Entity,
      without the prior written consent of the Corporation, directly or indirectly,
      in
      any capacity whatsoever, alone through or in connection with any
      Entity:

     

    
      	(a)  	
              canvass
                or solicit the business of (or procure or assist the canvassing or
                soliciting of the business of) any Customer or Prospective Customer
                or
                customer of the Corporation's affiliates for any purpose which is
                competitive with the Business; or

            

    

     

    
      	(b)  	
              accept
                (or procure or assist the acceptance of) any business from any Customer
                or
                Prospective Customer or customer of the Corporation's affiliates
                which
                business is competitive with the Business;
                or

            

    

     

    
      	(c)  	
              supply
                (or procure or assist the supply of) any goods or services to any
                Customer
                or Prospective Customer or customer of the Corporation's affiliates
                for
                any purpose which is competitive with the Business;
                or

            

    

     

    
      	(d)  	
              employ,
                engage, offer employment or engagement to or solicit the employment
                or
                engagement of or otherwise entice away from the employment or engagement
                of the Corporation or any of its affiliates, any individual who is
                employed or engaged by the Corporation or any of its affiliates whether
                or
                not such individual would commit any breach of his contract or terms
                of
                employment or engagement by leaving the employ or the engagement
                of the
                Corporation or any of its affiliates;
                or

            

    

     

    
      	(e)  	
              procure
                or assist any Entity to employ, engage, offer employment or engagement
                or
                solicit the employment or engagement of any individual who is employed
                or
                engaged by the Corporation or any of its affiliates or otherwise
                entice
                away from the employment or engagement of the Corporation or any
                of its
                affiliates any such individual.

            

    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    ARTICLE 8
      -
      NON-DISPARAGEMENT

     

    Section 8.1  Non-Disparagement

     

    The
      Executive covenants and agrees that he shall not engage in any pattern of
      conduct that involves the making or publishing of written or oral statements
      or
      remarks (including, without limitation, the repetition or distribution of
      derogatory rumours, allegations, negative reports or comments) which are
      disparaging, deleterious or damaging to the integrity, reputation or goodwill
      of
      the Corporation, its affiliates or its and their management.

     

     

    ARTICLE 9
      -
      INTELLECTUAL PROPERTY

     

    Section 9.1  Ownership
      of Intellectual Property

     

    
      	(1)  	
              All
                rights, titles and interests in or to the Developments shall vest
                and are
                owned exclusively by the Corporation immediately on its creation
                and
                regardless of the stage of its completion. The Executive irrevocably
                grants, transfers and assigns to the Corporation all of his right,
                title
                and interest, if any, in any and all Developments, including rights
                to
                translation and reproductions in all forms or formats and all Intellectual
                Property Rights thereto, if any, and he agrees that the Corporation
                may
                copyright said materials in the Corporation's name and secure renewal,
                reissues and extensions of such copyrights for such periods of time
                as the
                law may permit.

            

    

     

    
      	(2)  	
              At
                all times hereafter, the Executive agrees promptly to disclose to
                the
                Corporation all Developments, to execute separate written transfers
                or
                assignments to the Corporation at the Corporation's request, and
                to assist
                the Corporation in obtaining any Intellectual Property Right in Canada,
                the United States and in any other countries, on any Developments
                granted,
                transferred or assigned to the Corporation that the Corporation,
                in its
                sole discretion, seeks to register. The Executive also agrees to
                sign all
                documents, and do all things necessary to obtain such Intellectual
                Property Rights, to further assign them to the Corporation, and to
                reasonably protect the Corporation against infringement by other
                parties
                at the Corporation's expense with the Corporation's prior written
                approval.

            

    

     

    
      	(3)  	
              The
                Executive shall keep complete, accurate, and authentic information
                and
                records on all Developments in the manner and form reasonably requested
                by
                the Reporting Officer. Such information and records, and all copies
                thereof, shall be the property of Corporation as to any Developments
                assigned to the Corporation. The Executive agrees to promptly surrender
                such information and records at the request of the Reporting Officer.
                All
                these materials will be Confidential Information upon their
                creation.

            

    

     

    Section 9.2  Moral
      Rights

     

    The
      Executive hereby irrevocably waives, in favour of the Corporation, its
      successors, assigns and nominees, all moral rights arising under the
Copyright
      Act
      (Canada)
      as amended (or any successor legislation of similar effect) or similar
      legislation in any applicable jurisdiction, or at common law, to the full extent
      that such rights may be waived in each respective jurisdiction, that the
      Executive may have now or in the future with respect to the
      Developments.

     

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

     

    ARTICLE 10
      -
      RECOGNITION

     

    Section 10.1  Recognition

     

    
      	(1)  	
              The
                Executive expressly recognizes that Articles 5, 6, 7 and 9 of this
                Agreement are of the essence of this Agreement, and that the Corporation
                would not have entered into this Agreement without the inclusion
                of the
                said Articles.

            

    

     

    
      	(2)  	
              The
                Executive further recognizes and expressly acknowledges that (i)
                the
                application of the Articles 5, 6, 7, 8 and 9 of this Agreement will
                not
                have the effect of prohibiting him from earning a living in a satisfactory
                manner in the event of the termination his employment and of this
                Agreement, and (ii) the Corporation would be subject to an irreparable
                prejudice should one or several of the said Articles be infringed,
                or
                should the Executive be in breach of any of his obligations
                thereunder.

            

    

     

    
      	(3)  	
              The
                Executive further recognizes and expressly acknowledges that the
                Articles
                5, 6, 7, 8 and 9 of this Agreement grant to the Corporation only
                such
                reasonable protection as is admittedly necessary to preserve the
                legitimate interests of the Corporation and the Executive equally
                recognizes, in this respect, that the description of the Business
                is
                reasonable.

            

    

     

    Section 10.2  Remedies

     

    The
      Executive hereby recognizes and expressly acknowledges that the Corporation
      would be subject to irreparable harm should any of the provisions of Article
      5,
      6, 7 or 9, be infringed, or should any of the Executive's obligations thereunder
      be breached by the Executive, and that damages alone will be an inadequate
      remedy for any breach or violation thereof and that the Corporation, in addition
      to all other remedies, shall be entitled as a matter of right to equitable
      relief, including temporary or permanent injunction to restrain such breach.
      

     

     

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    ARTICLE 11
      -
      CONFLICTING OBLIGATIONS

     

    Section 11.1  No
      Conflicting Obligations

     

    The
      Executive represents and warrants to the Corporation that:

     

    
      	(a)  	
              there
                exists no agreement or contract and he is not subject to any obligation,
                which restricts him from (i) being employed by the Corporation; or
                (ii)
                from performing the duties assigned to him pursuant to this Agreement;
                or
                (iii) from soliciting the clients or customers of a third party;
                or (iv)
                from using information within his knowledge or control which may
                be useful
                in the performance of his duties for the
                Corporation;

            

    

     

    
      	(b)  	
              in
                the performance of his duties for the Corporation, he shall not improperly
                bring to the Corporation or use any trade secrets, confidential
                information or other proprietary information of any third party;
                and

            

    

     

    
      	(c)  	
              he
                will not infringe the intellectual property rights of any third
                party.

            

    

     

    Section 11.2  Indemnity

     

    The
      Executive acknowledges that the Corporation has relied upon the representations
      outlined in Section 11.1,
      above.
      The Executive agrees to indemnify and hold the Corporation, its directors,
      officers, employees, agents and/or consultants harmless against any and all
      claims, liabilities, losses, damages, costs, fees and/or expenses including
      reasonable legal fees incurred by the Corporation, its directors, officers,
      employees, agents and/or consultants by reason of an alleged violation by the
      Executive of any of the representations contained in Section 11.1
      of this
      Agreement.

     

    
      
        
        

      

      
        16

        
          

        

      

      
        
        

      

    

     

    ARTICLE 12
      -
      GENERAL 

     

    Section 12.1  Notice
      Provisions

     

    Except
      as
      otherwise expressly provided herein, all notices relating to this Agreement
      shall be in writing and either delivered by hand, courier service or facsimile
      transmission and addressed as follows:

     

    
      	
              The
                Executive:

               

            	
              Michael
                Washinushi

               

              [Address]

               

            
	
              The
                Corporation:

               

            	
              161
                Bay Street

              BCE
                Place, Suite 2300

              Toronto,
                Ontario M5J 2S1

               

              Attention:
                Chief Executive Officer

               

            

    

    

     

    Any
      address referred to in this Section 12.1
      may be
      changed by notice given in accordance with the provisions of this Section.
      Any
      notice which is delivered by hand, courier service or facsimile transmission
      shall be effective when delivered.

     

    Section 12.2  Entire
      Agreement

     

    This
      Agreement contains the entire agreement between the Corporation and the
      Executive and supersedes all previous negotiations, understandings and
      agreements whether verbal or written, with respect to the terms and conditions
      of employment between the Corporation and the Executive.

     

    
      
        
        

      

      
        17

        
          

        

      

      
        
        

      

    

    Section 12.3  Survival

     

    It
      is
      expressly agreed by the parties hereto that the provisions of Articles 4, 5,
      6,
      7, 8, 9, 10, 11 and 12 shall survive the termination of this Agreement and
      the
      termination of the Executive's employment, for any reason.

     

    Section 12.4  Privacy

     

    By
      accepting employment with the Corporation, the Executive consents to the
      Corporation collecting, using and disclosing his personal information for
      purposes relating to the maintenance of the employment relationship. The
      purposes of the Corporation's collection, use and disclosure include, but are
      not limited to:

     

    
      	(a)  	
              ensuring
                that the Executive is properly remunerated for his services to the
                Corporation which shall include disclosure to third party payroll
                providers;

            

    

     

    
      	(b)  	
              administering
                and/or facilitating the provision of any benefits to which the Executive
                is or may become entitled, including bonuses, benefits, pensions,
                registered retirement savings plan, short, medium and long-term incentive
                plans; this shall include the disclosure of the Executive's personal
                information to the Corporation's third party service providers and
                administrators;

            

    

     

    
      	(c)  	
              ensuring
                that the Corporation is able to comply with any regulatory, reporting
                and
                withholding requirements relating to the Executive's
                employment;

            

    

     

    
      	(d)  	
              performance
                and promotion;

            

    

     

    
      	(e)  	
              monitoring
                the Executive's access to and use of the Corporation's electronic
                media
                services in order to ensure that the use of such services is in compliance
                with the Corporation's policies and procedures and is not in violation
                of
                any applicable laws;

            

    

     

    
      	(f)  	
              complying
                with the Corporation's obligations to report improper or illegal
                conduct
                by any director, officer, employee or agent of the Corporation under
                any
                applicable securities, criminal or other law;
                and

            

    

     

    
      	(g)  	
              any
                other purpose for which the Executive is given notice and which is
                reasonably related to the maintenance of the Executive's employment
                relationship.

            

    

     

    If
      the
      Executive's specific consent to the collection, use or disclosure of his
      personal employee information is required under applicable law, the Executive
      hereby agrees to provide such consent. If the Executive refuses or withdraws
      his
      consent, the Executive acknowledges that his employment with the Corporation
      may
      be negatively affected.

     

    
      
        
        

      

      
        18

        
          

        

      

      
        
        

      

    

    Section 12.5  Governing
      Law

     

    This
      Agreement shall be governed by and interpreted in accordance with the laws
      of
      the Province of Ontario.

     

    Section 12.6  Successors
      and Assigns

     

    This
      Agreement may not be assigned by the Executive. This Agreement and the rights
      and obligations hereunder may, without the further express consent of the
      Executive, be assigned by the Corporation to any Entity which succeeds to all
      or
      substantially all of the business, assets or property of the
      Corporation.

     

    Section 12.7  Execution
      of Further Documents

     

    The
      Corporation and Executive agree that they shall, from time to time and at all
      times, do all such further acts and execute and deliver all such further
      documents and assurances as shall be reasonably required in order to fully
      perform and carry out the terms of this Agreement.

     

    Section 12.8  Amendments
      and Waivers

     

    No
      supplement, modification, amendment or waiver of this Agreement shall be binding
      unless executed in writing by the Executive and the Corporation. No waiver
      of
      any of the provisions of this Agreement shall be deemed to constitute a waiver
      of any other provision (whether or not similar), nor shall such waiver
      constitute a waiver or continuing waiver unless otherwise expressly provided
      in
      writing duly the party to be bound thereby.

     

    Section 12.9  Severability

     

    In
      the
      event that any provision or any part of any provision hereof is deemed to be
      invalid by reason of the operation of any law or by reason of the interpretation
      placed thereon by a court, this Agreement shall be construed as not containing
      such provision or part of such provision and the invalidity of such provision
      or
      such part shall not affect the validity of any other provision or the remainder
      of such provision hereof. All other provisions hereof which are otherwise lawful
      and valid shall remain in full force and effect.

     

    
      
        
        

      

      
        19

        
          

        

      

      
        
        

      

    

    Section 12.10  Legal
      Advice

     

    The
      Executive acknowledges that he has been afforded the opportunity to obtain
      independent legal advice with respect to this Agreement and that he fully
      understands the nature and consequences of this Agreement.

     

    Section 12.11  Currency

     

    All
      amounts expressed herein are in Canadian dollars unless otherwise noted and
      all
      payments hereunder are subject to all applicable and required
      deductions.

     

    Section 12.12  Preamble/Recital

     

    The
      Executive and the Corporation acknowledge and agree that the provisions
      contained in the preamble/recital section of this Agreement shall form part
      of
      this Agreement and may be relied upon by either party.

     

    Section 12.13  Counterparts

     

    This
      Agreement may be executed by the parties in one or more counterparts, each
      of
      which when so executed and delivered shall be deemed to be an original and
      such
      counterparts shall together constitute one and the same instrument.

     

    
      
        
        

      

      
        20

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF
      the
      parties have caused this Agreement to be executed as of the effective date
      first
      above written.

     

    
      	 	 	 
	 	
              CANADIAN
                SATELLITE RADIO INC. 

            
	 
 	 
 	 
 
	
            	Per:  	/s/ John
              I.
              Bitove
	 	
              
John
              I. Bitove
	 	
            

    

     

    
      	 	 	 
	 	 
	 
 	 
 	 
 
	/s/ Stewart Lyons	
               

            	/s/ Michael
              Washinushi
	
              
Stewart
              Lyons	
              

              Michael
                Washinushi

            
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Exhibit 4.1    
    

Prudential plc  

    

RESTRICTED SHARE PLAN  

 RULES FOR 2004 AWARDS  

   Contents  

	page 1	 	1	 	Purpose
	

page 1	
 	

2	
 	

Definitions
	

page 3	
 	

3	
 	

Eligibility
	

page 3	
 	

4	
 	

Grant of Awards
	

page 4	
 	

5	
 	

Calculation of Awards
	

page 4	
 	

6	
 	

Restriction on transfer of awards
	

page 5	
 	

7	
 	

Options over shares
	

page 5	
 	

8	
 	

Release of awards
	

page 7	
 	

9	
 	

Transfer of shares
	

page 7	
 	

10	
 	

Change of control
	

page 7	
 	

11	
 	

Adjustments
	

page 7	
 	

12	
 	

Administration of scheme
	

page 9	
 	

13	
 	

Amendment—termination
	

page 9	
 	

14	
 	

Effective date of plan
	

page 9	
 	

15	
 	

Term of plan
	

page 9	
 	

16	
 	

Governing law
	

page 10	
 	

Schedule 1—award letter
	

page 11	
 	

Schedule 2—Total shareholder return

1

   1 Purpose  

	1.1
	The
Prudential Restricted Share Plan ('the Plan') is an employees' share scheme (within the meaning of section 743 of the Companies Act 1985) for encouraging or facilitating
the holding of shares in Prudential plc ('the Company') by or for the benefit of employees of the Company and its Subsidiaries.

	1.2
	The
Company and any of its Subsidiaries may nominate Eligible Employees to participate in the Plan and will each bear the associated costs of that participation by providing funds to
the Trustees of the Prudential plc Employee Share Trust in accordance with the terms of the Trust Deed (as amended or supplemented from time to time). 

2 Definitions  

	2.1
	In
these Rules, unless the context otherwise requires, the following expressions have the following meanings:

	2.1.1
	'Award
Date' means the effective date of an Award Letter and unless otherwise stated therein shall be the date thereof.

	2.1.2
	'Award
Letter' means a letter from the Company to a Participant setting out the specific terms of a conditional undertaking in respect of the grant of an Option over Shares in the
form, or substantially in the form, of Schedule 1 to these Rules, with such modifications or variations generally or in the case of individual Participants as the Committee may determine.

	2.1.3
	'Close
Period' means any period during which the Participant would not be given clearance to deal in Shares under the Company's rules on share dealing.

	2.1.4
	'Committee'
means a committee of at least two executives appointed by the Remuneration Committee to administer the Plan but no executive shall take part in any determination by the
Committee relating to his or her own participation in the Plan.

	2.1.5
	'Company'
means Prudential plc.

	2.1.6
	'Comparator
Companies' means those companies the prices of whose ordinary shares comprise the FT-SE 100 Share Index (including the Company) on the first day of the
relevant Measurement Period on which the London Stock Exchange is open for trading.

	2.1.7
	'Disability'
means permanent disability within the meaning of any permanent health insurance or equivalent plan or any occupational pension plan established by a Group Company of
which the Participant is a member.

	2.1.8
	'Eligible
Employee' means any employee of a Group Company.

	2.1.9
	'Group'
means the Company and its Subsidiaries.

	2.1.10
	'Group
Company' means a company which is a member of the Group.

	2.1.11
	'Market
Value' in relation to a share means its market value as calculated in accordance with Section 272(3) of the Taxation of Chargeable Gains Act 1992.

	2.1.12
	'Measurement
Period' means the period beginning on 1 January in the year of an Award Date and ending on the 31 December preceding the third anniversary of the Award Date as
determined in accordance with Rule 7.

	2.1.13
	'Option'
means the right granted to a Participant to purchase from the Trustees for no consideration Shares which are the subject of an Award Letter and exercisable at any time
during the period of seven years following the grant. 

2

 
	2.1.14
	'Participant'
means an Eligible Employee to whom an Award letter has been issued under the Plan which has not lapsed.

	2.1.15
	'Plan'
means the Prudential Restricted Share Plan constituted by these Rules as amended from time to time.

	2.1.16
	'Remuneration
Committee' means the remuneration committee of the board of directors of the Company.

	2.1.17
	'Retirement'
means termination of employment with a Group Company on or after attaining normal retirement age pursuant to the rules of any occupational pension plan of which the
Participant is a member and which is established by a Group Company, or on any earlier date at which the Participant is bound by his contract of employment to retire or on which the Participant
retires with the consent of the relevant Group Company.

	2.1.18
	'Salary'
means annual basic salary and does not include any bonus payment or payment in lieu of pension contributions. In the case of a Participant whose normal place of business
is outside the United Kingdom the amount of salary shall be a notional figure determined for the purposes of the Plan by the Committee.

	2.1.19
	'Share'
means a share in the capital of the Company.

	2.1.20
	'Subsidiary'
means any company which is at the relevant time a subsidiary of the Company within the definition in section 736, Companies Act 1985.

	2.1.21
	'TSR'
means Total Shareholder Return, calculated in accordance with Schedule 2.

	2.1.22
	'Trustees'
means the trustee or trustees from time to time of the Prudential plc Employee Share Trust constituted by the Trust Deed.

	2.1.23
	'Trust
Deed' means the Trust Deed dated 16 October 1992 entered into between the Company and BWCI Trust Company Limited.

	2.2
	References
to any statute or statutory instrument or to any part or parts thereof include any modification, amendment or re-enactment thereof for the time being in force.

	2.3
	Words
of the masculine gender include the feminine and vice versa and words in the singular include the plural and vice versa unless, in either case, the context otherwise requires or
the contrary is stated. 

3 Eligibility  

 The following Eligible Employees may become Participants: 

	3.1
	Executive
Directors of the Company; and

	3.2
	any
other employee of a Group Company who is nominated by that Group Company and approved by the Committee. 

4 Grant of awards  

	4.1
	Award
Letters shall be issued to Eligible Employees in accordance with the procedures set out in this Rule 4.

	4.2
	The
Committee shall have the authority to issue Award Letters under the Plan to such Eligible Employees as have been selected by a Group Company for the purpose as the Committee in
its absolute discretion thinks fit. 

3

 
	4.3
	The
Committee shall only issue an Award Letter to an Eligible Employee who is a director of the Company or exercise any powers under the Plan in relation to a director of the Company
with the prior approval of the Remuneration Committee.

	4.4
	No
Award letter shall be granted to an Eligible Employee if the grant would not be permissible because it would occur:

	4.4.1
	during
a Close Period; or

	4.4.2
	at
a time when such a grant is prohibited in a jurisdiction applicable to the Eligible Employee.

	4.5
	Shares
may be purchased or otherwise acquired or appropriated by the Trustees in accordance with the directions of the Committee to meet the potential obligations of the Trustees
under an Award Letter at any time prior to the grant of an Option over the Shares which are the subject of such Award Letter.

	4.6
	The
Company shall provide (and shall procure that any Group Company which employs Participants provides) sufficient monies to enable the Trustees to, and will use its best endeavours
to procure that the Trustees will, acquire sufficient Shares to satisfy the Options granted to Participants. 

5 Calculation of awards  

	5.1
	The
value of the maximum number of Shares which are the subject of an Award Letter shall be as determined by the Committee, but shall not exceed the following percentage of the
Participant's Salary at the Award Date namely:

	5.1.1
	Group
Chief Executive of the Company—not exceeding 200%.

	5.1.2
	Other
Executive Directors of the Company and Senior Executives approved by the Committee—not exceeding 160%.

	5.1.3
	Senior
Eligible Employees—not exceeding 60%.

	5.1.4
	Other
Eligible Employees—not exceeding 40%.

	5.2
	If
a Participant becomes an Eligible Employee during the calendar year of the Award Date the value of the maximum number of Shares which are the subject of such Participant's Award
Letter shall be all or such proportion of the full percentage applicable to that Participant as may be determined by the Committee.

	5.3
	The
maximum number of Shares to which a Participant may become entitled under an Award Letter shall be calculated by dividing the value determined in accordance with Rules 5.1
and 5.2 by the average value of a Share during the calendar year preceding the relevant Award Date (on a basis determined by the Committee but calculated by reference to its Market Value during such
year) and rounding up to the nearest whole number of Shares. 

6 Restriction on transfer of awards  

	6.1
	An
Award Letter shall be personal to a Participant and neither an Award Letter nor any interest in an Award Letter may be transferred, assigned, pledged, charged or otherwise dealt
with by a Participant for the benefit of any person other than by way of transfer to the Participant's personal representatives in the event of the Participant's death (in which case the provisions of
Rule 8.5 shall apply).

	6.2
	If
a Participant deals or attempts to deal with an Award Letter or any interest in an Award Letter in breach of Rule 6.1 the provisions of such Award Letter shall lapse
forthwith. 

4

 

7 Options over shares  

	7.1
	The
Trustees shall grant to each Participant an Option over shares which are the subject of an Award Letter to the extent that the performance requirements set out in this
Rule 7 are achieved and if the Remuneration Committee confirms to the Trustees that the underlying financial performance of the Company justifies the grant.

	7.2
	As
soon as practicable following the Measurement Period ending on the 31 December preceding the third anniversary of the Award Date the TSR of each of the Comparator Companies which
are still quoted on the London Stock Exchange at the end of the Measurement Period shall be listed in order so that the one having the highest TSR is ranked first.

	7.3
	If
the list referred to in Rule 7.2 indicates that the Company is in the top 20% of the Comparator Companies in the list the Option will be granted over all the Shares which
are the subject of the relevant Award Letter as from the third anniversary of the relevant Award Date.

	7.4
	If
the list referred to in Rule 7.2 indicates that the Company is in the bottom 50% of the Comparator Companies in the list no Option will be granted over the Shares which are
the subject of the relevant Award Letter.

	7.5
	If
neither Rule 7.3 nor Rule 7.4 applies the Option will be granted over a proportion of the maximum number of the Shares which are the subject of the Award Letter. Such
proportion shall be determined on a straight progression from 25% if the Company is at the 50th percentile of the Comparator Companies in the list, to the maximum number of Shares which are the
subject of the Award Letter if the Company is in the top 20th percentile of such Comparator Companies. Such Option shall be rounded up the nearest whole number of shares and any interest of the
Participant in the balance of the Shares which are the subject of such Award Letter shall lapse.

	7.6
	As
soon as reasonably practicable after the list referred to in Rule 7.2 has been prepared and the Remuneration Committee has confirmed to the Trustees that the underlying
financial performance of the Company justifies the grant of the Options referred to in Rule 7.1 the Company shall forward a copy of the list to each Participant together with a certificate
executed as a deed by the Trustees evidencing the Option granted to such Participant. If the Remuneration Committee does not so confirm within six months following the end of the Measurement Period
the relevant Award Letter will lapse. 

8 Release of awards  

	8.1
	An
Option may be exercised in whole or in part in accordance with its terms. The Participant shall deliver to the Company a notice in writing in such form as may be prescribed from
time to time by the Directors (which may be endorsed on the Option certificate) stating therein the number of Shares in respect of which the Participant desires to exercise the Option, together with
the relevant Option certificate.

	8.2
	The
notice shall be expressed to take effect immediately upon its receipt by the Company and such date shall constitute the date of exercise of such Option. A notice shall be of no
effect unless received by the Company before the expiry of the period in which an Option may be exercised. Upon exercise of the Option the Trustees shall transfer the relevant Shares to the order of
the Participant.

	8.3
	A
Participant shall not be entitled to exercise an Option pursuant to this Rule during a Close Period or at any time when the exercise is prohibited in a jurisdiction applicable to
the Participant. 

5

 
	8.4
	If
the aggregate number of Shares in respect of which an Option certificate has been delivered to the Company in accordance with sub-Rule 8.1 above exceeds the
number of Shares in respect of which the Participant has stated in the accompanying notice that the Option is to be exercised, the Company shall in due course issue to the Participant an Option
certificate in respect of the balance, which shall state the date on which the Option was exercised in part.

	8.5
	If
a Participant dies his or her personal representative may exercise any subsisting Option within 12 months after the date of death. In addition the Committee may in its
absolute discretion instruct the Trustees to transfer to the Participant any Shares which are the subject of a subsisting Award Letter taking into account the length of the period since the Award Date
and the underlying financial performance of the Company during such period. To the extent that the discretion is not exercised within the 6 months following the date of death the Award Letter
will lapse.

	8.6
	If
a Participant ceases to be employed by a Group Company for any reason other than death the Participant may exercise any outstanding Option only within the period of six months
following the date of such cessation of employment.

	8.7
	If
a Participant ceases to be employed by a Group Company as a result of Retirement, redundancy (within the meaning of the Employment Protection (Consolidation) Act 1978), illness,
injury or disability, in relation to any Award Letters which have not lapsed the Trustees shall, unless the Committee in its absolute discretion otherwise determines within six months of such
cessation of employment, grant an Option over Shares. Such Option shall be granted with the Committee taking into account the underlying financial performance of the Company in the period since the
Award Date and otherwise in accordance with Rule 7, but (unless in its determination the Committee specifies a different basis)

	8.7.1
	scaled
down pro-rata to the proportion of the relevant Measurement Period which has actually elapsed at such cessation; and

	8.7.2
	so
that the TSR of each Comparator Company shall be calculated and ranked at the end of the month immediately preceding such cessation. 

Any
such Option may be exercised only within the period of six months following the date of such cessation of employment and the Award Letter shall automatically lapse in respect of any Shares which
are not the subject of an Option. 

	8.8
	If
a Participant ceases to be employed by a Group Company between an Award Date and the third anniversary thereof as a result of dismissal or resignation the Participant shall not be
granted an Option over any shares comprised in an Award Letter outstanding at the date of such cessation of employment unless and to the extent that, within six months of the date of such cessation,
the Committee in its absolute discretion otherwise determines and provided that the Participant has not been dismissed for dishonesty or misconduct. Any such Option may be exercised only within the
six month period and the Award Letter shall automatically lapse in respect of any Shares not made the subject of an Option. 

For
the purposes of this Rule 8.8 a decision by the Committee that a Participant has been dismissed for dishonesty or misconduct shall be conclusive. 

	8.9
	A
Participant shall not be entitled by way of compensation for loss of office, wrongful or unfair dismissal or otherwise to any sum or any benefit to compensate the Participant for
the loss of Shares which were the subject of an Award Letter or any other right or benefit accrued or in prospect under the Plan. 

6

   9 Transfer of shares  

	9.1
	Any
transfer of Shares to a Participant shall be subject to such consent, if any, of HM Treasury or other authorities, whether of the United Kingdom or elsewhere, as may from time to
time be required and it shall be the responsibility of the Participant to obtain and comply with the requirements of such consents.

	9.2
	Shares
shall not carry the right to dividends or other distributions paid by reference to a qualifying date falling before the date of exercise of an Option but shall in all other
respects rank pari passu with the other Shares in issue. 

10 Change of control  

	10.1
	For
the purposes of this Rule, a 'change of control' shall be deemed to take place if:

	10.1.1
	any
individual, company, corporation or other entity acquires more than 50% of the then outstanding equity of the Company entitling the holder to vote generally in the election of
directors of the Company; or

	10.1.2
	any
scheme of arrangement sanctioned by the Court under section 425 of the Companies Act 1985 becomes effective (except where Rule 11 applies); or

	10.1.3
	the
Company goes into liquidation (except where Rule 11 applies).

	10.2
	In
the event of a 'change of control' as defined in subsection 10.1 above, unless the Committee makes other arrangements within one month thereafter which the auditors of the Company
first confirm in writing to the Committee are in their opinion fair and reasonable to the Participants the Trustees shall grant to each Participant an Option over the appropriate number of Shares
which are the subject of an Award Letter (as if the date of such change of control were both the end of a Measurement Period and the third anniversary of the relevant Award Date for the purposes of
Rule 7). The Award letter shall automatically lapse in respect of any shares not the subject of the Option. 

11 Adjustments  

In
the event of any reconstruction, amalgamation, reorganisation, liquidation for the purposes of reconstruction, consolidation, sub-division or other change in the capital structure of
the Company affecting the Shares, the number and class of Shares subject to outstanding Award Letters under the Plan shall be substituted or adjusted in such manner as may be determined to be
reasonable, appropriate and equitable by the Remuneration Committee, and confirmed as being fair and reasonable by the auditors of the Company for the time being, to prevent dilution or enlargement of
the rights of Participants and provided that the number of Shares subject to any Award Letter shall always be a whole number. 

12 Administration of the scheme  

	12.1
	The
Trustees shall waive all rights to dividends on Shares held by them in accordance with these Rules.

	12.2
	

	12.2.1
	Except
as otherwise provided, notices or documents required to be given to an Eligible Employee or a Participant shall be properly given if delivered to the relevant person by hand
at his or her normal place of work or sent to the relevant person by post at his or her last known address and where a notice is sent by post it shall be deemed to have been given 48 hours
after it was put into the post properly addressed and stamped. 

7

 
	12.2.2
	Except
as otherwise provided, notices or documents required to be given to the Company by a Participant shall be properly given if delivered by hand to the Secretary of the Company
at the Company's registered office or sent to the Secretary by post at that office and where a notice is sent by post it shall be deemed to have been given 48 hours after it was put into the
post properly addressed and stamped.

	12.3
	A
Participant shall not be treated as having ceased to be an Eligible Employee merely by reason of the occurrence of any of the following:

	12.3.1
	a
transfer of his employment from one Group Company to another; or

	12.3.2
	absence
of no more than 29 weeks due to pregnancy or confinement (unless the Participant shall previously have notified her intention not to return in which case her employment
shall be deemed to be terminated on the date she so notifies her employer); or

	12.3.3
	any
leave of absence in excess of 90 days approved by the Group Company which employs the Participant, provided that the employee's right to reemployment is guaranteed
either by statute or by contract; or

	12.3.4
	the
transfer of the undertaking or part undertaking in which the Participant is employed to another Group Company.

	12.4
	Unless
the Committee otherwise determines a Participant shall be treated as having ceased to be an Eligible Employee by reason of the occurrence of either of the following:

	12.4.1
	the
Subsidiary by which the Participant is employed ceasing to be a Subsidiary;

	12.4.2
	the
transfer of the undertaking or part undertaking in which the Participant is employed to any person other than another Group Company.

	12.5
	Nothing
contained in the Plan shall prevent the Company from adopting other employee benefit arrangements, including further employees' share schemes.

	12.6
	Neither
the action of the Company in establishing the Plan, nor any action taken by it or by the Committee under the Plan or any Award Letter, nor any provision of the Plan, shall be
construed as giving to any person the right to be retained in the employment of a Group Company.

	12.7
	Subject
to the provisions of the Trust Deed and the Plan the Committee shall have full power:

	12.7.1
	to
construe and interpret the Rules of the Plan; to establish, amend or waive regulations for administration of the Plan not being inconsistent with the Rules;

	12.7.3
	to
accelerate the grant of Options over Shares;

	12.7.4
	to
correct errors, omissions or inconsistencies in the Plan or in any Award Letter or other document; and to agree with a Participant to amend the terms and conditions of any
outstanding Award Letter to the extent such terms and conditions are within the discretion of the Committee as provided in the Plan.

	12.8
	The
Committee may, in its sole discretion, delegate to appropriate executives of the Company the administration of the Plan. No such delegation by the Committee shall be made with
respect to the grant of Award Letters or Options and the Committee may not delegate its authority to correct errors, omissions or inconsistencies in the Plan or in any Award Letter or other document.
All authority delegated by the Committee under this Rule 12.9 shall be exercised in accordance with the provisions of the Plan and any guidelines for the exercise of such authority that may
from time to time be established by the Committee. 

8

 

13 Amendment—termination  

 The Committee may amend, terminate or suspend the Plan but no such action may impair or adversely affect the existing rights of a Participant under any Award
Letter or Option without the Participant's consent. 

14 Effective date of plan  

 The Plan shall have effect from 1 January 1996 except in relation to the Group Chief Executive for whom the Plan shall have effect from 1
January 1995. 

16 Term of plan  

 No Award shall be made under the Plan after 31 March 2006 (or such earlier date as the Plan shall be terminated by the Committee) but so that the foregoing
shall not prevent any amendment, modification or suspension at any time of any Award Letter or the waiver at any time of any terms or conditions thereof by the Committee under and in accordance with
the provisions of the Plan or the amendment of the Plan by the Committee under Rule 13. 

17 Governing law  

 This Plan is governed by and shall be construed in accordance with the laws of England. 

9

   Schedules  

1. Award letter  

2. Total Shareholder Return  

Schedule 1  

 Dear [......................................................] 

I
am pleased to confirm that you have been granted a conditional award of [    ] shares in Prudential pIc in accordance with the Rules of the Prudential Restricted
Share Plan. For the purposes of the Rules the Award Date is [......................]. 

The
number of shares has been calculated by taking [    ] per cent of your current basic salary and dividing it by the average value of the month end closing price of
Prudential's shares during [    ]. The share price for the [.........................] award is
[.........................]. 

For
the purposes of determining whether you will be granted an option over such shares the commencement date of the three-year 'Measurement Period' (as defined in the Rules) is 1 January
[    ]. The number of shares over which your option will be granted will be determined by reference to the extent that the Company's 'Total Shareholder Return' (as
defined in the Rules) has reached a specified target after the Measurement Period, when compared with the Total Shareholder Return of those of the companies which comprise the FT-SE 100
Share Index on the first trading day of the London Stock Exchange in the Measurement Period which are still quoted on that Exchange on the last day of the Measurement Period. In addition the
Remuneration Committee will need to be satisfied that the underlying performance of the Company justifies the grant of an option. 

Yours
sincerely 

10

 

Schedule 2  

For
the purposes of Rule 7 TSR in respect of each of the Comparator Companies shall be calculated as follows using the Finstat price feed or such other comparable method as the Committee may
approve to ascertain the value of a share: 

	1.
	for
the first day of the Measurement Period the average of the values of a share in the relevant company during the period of three months immediately before the beginning of the
Measurement Period shall be taken and such amount shall be a cash outflow;

	2.
	for
the last day of the Measurement Period the average of the values of a share in the relevant company during the period of three months immediately before the end of the Measurement
Period shall be taken and such amount shall be a cash inflow;

	3.
	gross
dividends per share paid by the relevant company during the Measurement Period shall be a cash inflow on the day when the relevant company's shares went ex-dividend
and applied in purchasing the relevant company's shares at the close of business on that day at its value;

	4.
	a
retroactive adjustment shall be made for any stock or share split, scrip issue or rights issue or other like event occurring during the Measurement Period and any payment by the
shareholder for the exercise of rights shall be a cash outflow;

	5.
	an
appropriate adjustment shall be made for any merger, takeover or other change in capital so as to preserve the original notional investment;

	6.
	the
TSR shall be the rate of return calculated from the amounts determined in accordance with Paragraphs 1 to 5 above. 

11

QuickLinks

Exhibit 4.1

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