Document:

Non-Qualified Stock Option Agreement - David Johnston

 Exhibit 10.34 
 FIVE BELOW, INC. 
 EQUITY INCENTIVE PLAN 

NON-QUALIFIED STOCK OPTION AGREEMENT 
 Five Below, Inc. (the “Company”) hereby grants to David Johnston (the “Optionee”) an option to purchase a total of 500,000 shares of Common Stock of the Company (the “Option
Shares”), at the price and on the terms set forth herein, and in all respects subject to the terms, definitions and provisions of the Five Below, Inc. Equity Incentive Plan (the “Plan”) applicable to non-qualified stock options, which
terms and provisions are hereby incorporated by reference herein. Unless the context herein otherwise requires, the terms defined in the Plan shall have the same meanings when used herein. 

1.       Nature of the Option. This Option is intended to be a nonstatutory stock option and is not
intended to be an Incentive Stock Option within the meaning of section 422 of the Internal Revenue Code of 1986, as amended (the “Code”), or to otherwise qualify for any special tax benefits to the Optionee. 

2.       Date of Grant; Term of Option. This Option is granted this 23rd day of May, 2012, (the “Date of Grant”) and it may not be
exercised later than the date that is ten (10) years after the Date of Grant, subject to earlier termination, as provided in the Plan or Section 5 hereof. For purposes of this Agreement, the term “Effective Date of Grant” shall
mean 6/4/2012. 
 3.       Option Exercise Price. The Option exercise price per Share will
be the per Share Fair Market Value of our common stock as of the Effective Date of Grant as determined by the Board in accordance with the Plan, provided that if the Initial Public Offering for which the Company filed a registration
statement with the Securities and Exchange Commission (“SEC”) on April 18, 2012 closes on or before September 30, 2012 (the “IPO”), then, the Option exercise price per Share will be the greater of (i) the per Share
Fair Market Value of our common stock as of the Effective Date of Grant as determined by the Board in accordance with the Plan, or (ii) the initial per Share offer price to the public in connection with the IPO. 

4.       Exercise of Option. This Option shall be exercisable during its term only in accordance
with the terms and provisions of the Plan and this Award Agreement as follows: 
 (a)
      Right to Exercise. 
 (i)       In General.
Subject to Section 4(a)(ii) and 4(a)(iii) of this Option, the Option will vest and become exercisable according to the following schedule: 
  

			
	 If the Optionee has remained an

active employee of the Company from
 the Effective Date of Grant to the:
	  	 Then the Option will vest and
 become exercisable
with
 respect to:

	Second Anniversary of the Effective Date of Grant (the
“Second Anniversary”)	  	50% of the Option
Shares

			
	Ninety-first (91st) day following the Second Anniversary	  	An additional 6.25% of the Option
Shares
	One Hundred Eighty First (181st) day following the Second Anniversary	  	An additional 6.25% of the Option Shares
	Two Hundred Seventy First (271st) day following the Second Anniversary	  	An additional 6.25% of the Option Shares
	Third Anniversary of the Effective Date of Grant (the
“Third Anniversary”)	  	An additional 6.25% of the Option Shares
	Ninety-first (91st) day following the Third
Anniversary	  	An additional 6.25% of the Option Shares
	One Hundred Eighty First (181st) day following the Third Anniversary	  	An additional 6.25% of the Option Shares
	Two Hundred Seventy First (271st) day following the Third Anniversary	  	An additional 6.25% of the Option Shares
	Fourth Anniversary of the Effective Date of
Grant	  	An additional 6.25% of the Option Shares

 (ii)       Accelerated Vesting on Change in Control. In the event
of a Change in Control, the Option will vest and become exercisable with respect to fifty percent (50%) of the then unvested Option Shares, as of the date of such Change in Control. 

(iii)       Accelerated Vesting for Certain Terminations. If the Optionee ceases to be employed by
the Company after the first anniversary of the Effective Date of Grant and prior to the Second Anniversary as a result of: (i) his Disability, (ii) his death or (iii) a termination by the Company without Cause, then the Option will
vest and become exercisable with respect to twenty five percent (25%) of the Option Shares and will remain exercisable for the applicable time period provided in Section 5. 

(b)       Method of Exercise. The Optionee may exercise this Option by providing written notice
stating the election to exercise this Option. Such written notice must be signed by the Optionee and must be delivered in person or by certified mail to the Secretary of the Company or such other person as may be designated by the Company. The
written notice must be accompanied by payment of the option exercise price in the manner described in Section 4(c), by an executed Stock Restriction Agreement described in Section 4(f) and by any other agreements required by the Board or
its Committee and/or the terms of the Plan, which other agreements may restrict the sale or other transfer of the Shares and may include certain additional representations and agreements as to the Optionee’s investment intent with respect to
the Shares. This Option will be deemed to be exercised only upon the receipt by the Company of such written notice, payment of the option exercise price, and duly executed copies of the Stock Restriction Agreement and any other agreements required
by the Board or its Committee, the terms of the Plan and/or this Award Agreement. The Optionee will have no right to vote or receive dividends and will have no other rights as a stockholder with respect to such Shares notwithstanding the exercise of
this Option, until the issuance (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company) of the 

  
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stock certificate(s) evidencing Shares that are being issued upon exercise of this Option. The certificate(s) for the Shares will be registered in the name of the Optionee and will contain any
legend as may be required under the Plan, this Award Agreement, and/or applicable law. 
 (c)
      Method of Payment. The method of payment of the option exercise price will be determined by the Board or its Committee and may consist entirely of cash, certified check, or such other consideration or method
of payment as may be authorized under the Plan. 
 (d)       Partial Exercise. This Option
may be exercised in whole or in part; provided, however, that any exercise may apply only with respect to a whole number of Shares. 
 (e)       Restrictions on Exercise. This Option may not be exercised if the issuance of these Shares upon such exercise would constitute a violation of any applicable
federal or state securities laws or other laws or regulations. In addition, as a further condition to the exercise of this Option, the Company may require the Optionee to make any representation or warranty to the Company as may be required by or
advisable under any applicable law or regulation. 
 (f)       Stock Restriction Agreement.
In connection with and as a condition of exercising this Option, Optionee hereby acknowledges and agrees to execute a Stock Restriction Agreement (or other agreement restricting Optionee’s rights in the Shares acquired or to be acquired by
the exercise of this Option), if required by the Company, by and between Optionee, the Company and/or one or more other holders of equity securities of the Company in the form, if any, that the Company provides at the time of exercise and as may be
amended by the Company in its sole discretion from time to time. 
 5.       Termination of
Relationship with the Company. 
 (a)       Voluntary Termination. If the Optionee
terminates his or her employment with the Company for any reason other than death or Disability, the Option (to the extent exercisable at the time of such termination) may be exercised at any time within ninety (90) days after the date of such
termination. To the extent that the Option is not exercisable at the time of such termination, or to the extent the Option is not exercised within the time specified herein, the Option shall terminate. 

(b)       Disability. If the Optionee’s employment by the Company terminates due to Disability,
the Option (to the extent exercisable at the time of such termination) may be exercised by the Optionee or his or her legal guardian or representative at any time within twelve (12) months after such termination. To the extent that the Option
is not exercisable on the date of termination, or to the extent the Option is not exercised within the time specified herein, the Option shall terminate. 
 (c)       Death. If the Optionee’s employment by the Company terminates due to his or her death, the Option (to the extent exercisable at the time of such death)
will remain exercisable for twelve (12) months after the date of death by the Optionee’s estate or by a person who acquired the right to exercise the Option by bequest or inheritance. To the extent that the Option is not exercisable on the
date of death, or to the extent the Option is not exercised within the time specified herein, the Option shall terminate. 

  
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 (d)       Termination Without Cause. If the Company
terminates Optionee’s employment with the Company without Cause, the Option (to the extent exercisable at the time of such termination) may be exercised at any time within ninety (90) days after the date of such termination. To the extent
that the Option is not exercisable at the time of such termination, or to the extent the Option is not exercised within the time specified herein, the Option shall terminate. 
 (e)       Termination for Cause. If the Company terminates Optionee’s employment with the Company for Cause, the Option will then terminate immediately and
automatically, and the Optionee shall have no further rights therein. 
 Notwithstanding any other provision of this Section 5, the Option
shall not be exercisable after the expiration of the term set forth in Section 2 hereof. 
 6.
      Non-Transferability of Option. This Option may not be sold, pledged, assigned, hypothecated, gifted, transferred or disposed of in any manner either voluntarily or involuntarily by operation of law, other than
by will or by the laws of descent or distribution. During the Optionee’s lifetime, this Option is exercisable only by the Optionee (or by such Optionee’s legal guardian or representative as provided in Section 5). Subject to the
foregoing and the terms of the Plan, the terms of this Option will be binding upon the executors, administrators, legal guardians, representatives and heirs of the Optionee, meaning for purposes of this Award Agreement, both testamentary heirs and
heirs by intestacy. 
 7.       No Continuation of Employment or Engagement. Neither the
Plan nor this Option shall confer upon any Optionee any right to continue in the service of the Company or any of its Subsidiaries or limit, in any respect, the right of the Company to discharge the Optionee at any time, with or without Cause and
with or without notice. 
 8.       Lock-Up Agreement. Each Optionee hereby agrees that, in
connection with any registration of the offering of any securities of the Company under the Securities Act of 1933, as amended (the “Securities Act”) for the account of the Company, if so requested by the Company, such Optionee shall not
sell or otherwise transfer any securities of the Company during the period specified by the Board of Directors (the “Market Standoff Period”), with such period not to exceed 180 days following the effective date of a registration statement
of the Company filed under the Securities Act. The Company may impose stop-transfer instructions with respect to securities subject to the foregoing restrictions until the end of such Market Standoff Period. The provisions of this Section 8
shall be binding upon any transferee or assignee of any Shares. 
 9.       Withholding.
The Company reserves the right to withhold, in accordance with any applicable laws, from any consideration payable or property transferable to Optionee any taxes required to be withheld by federal, state or local law as a result of the grant or
exercise of this Option or the sale or other disposition of the Shares. If the amount of any consideration payable to the Optionee is insufficient to pay such taxes or if no consideration is payable to the Optionee, upon the request of the Company,
the Optionee (or such other person entitled to exercise this Option pursuant to Section 5 hereof) will pay to the Company an amount sufficient for the Company to satisfy any federal, state or local tax withholding requirements applicable to

  
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and as a condition to the grant or exercise of this Option or the sale or other disposition of the Shares issued upon the exercise of this Option. 

10.       The Plan. The Optionee has received a copy of the Plan (a copy of which is attached
hereto), has read the Plan and is familiar with its terms, and hereby accepts the Option subject to all of the terms and provisions of the Plan, as amended from time to time. Pursuant to the Plan, the Board or its Committee is authorized to
interpret the Plan and to adopt rules and regulations not inconsistent with the Plan as it deems appropriate. The Optionee hereby agrees to accept as binding, conclusive and final all decisions or interpretations of the Board or its Committee upon
any questions arising under the Plan. 
 11.       Spousal Consent. As a condition to the
effectiveness of the grant of the Option, the Optionee’s spouse (if any) is required to execute the attached “Consent of Spouse.” 
 12.       Governing Law. This Award Agreement will be construed in accordance with the laws of the Commonwealth of Pennsylvania, without regard to the application of
the principles of conflicts of laws. 
 13.       Amendment. Subject to the provisions of
the Plan, this Award Agreement may be amended at any time by the Company or its delegate; provided, however, that any modification or amendment of this Award Agreement which adversely affects the Optionee shall require the written consent of the
Optionee. 
 14.       Entire Agreement. This Award Agreement, together with the Plan and
the other exhibits attached thereto or hereto, represents the entire agreement between the parties hereto relating to the subject matter hereof, and merges and supersedes all prior and contemporaneous discussions, agreements and understandings of
every nature relating to the award of Options to Optionee by the Company. 
 [Signature page follows] 

  
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 IN WITNESS WHEREOF, this Award Agreement has been executed by the
parties on the 23rd day of May, 2012. 

 

			
	FIVE BELOW, INC.
		
	By:	 	/s/ David Schlessinger
	 Name:
	 	David Schlessinger
	Title:	 	Executive Chairman
	
	DAVID JOHNSTON
	
	/s/ David Johnston
	Signature

 THIS OPTION AND THE SECURITIES WHICH MAY BE PURCHASED UPON EXERCISE OF THIS OPTION HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY APPLICABLE STATE SECURITIES LAWS. THESE SECURITIES HAVE NOT BEEN ACQUIRED WITH A VIEW TO DISTRIBUTION OR RESALE, AND MAY NOT BE SOLD, ASSIGNED, EXCHANGED, MORTGAGED, PLEDGED, HYPOTHECATED OR
OTHERWISE TRANSFERRED OR DISPOSED OF, BY GIFT OR OTHERWISE, OR IN ANY WAY ENCUMBERED WITHOUT AN EFFECTIVE REGISTRATION STATEMENT FOR SUCH SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND ANY APPLICABLE STATE SECURITIES LAWS, OR A
SATISFACTORY OPINION OF COUNSEL SATISFACTORY TO FIVE BELOW, INC. THAT REGISTRATION IS NOT REQUIRED UNDER SUCH ACT AND UNDER APPLICABLE STATE SECURITIES LAWS. 

  
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 ACKNOWLEDGMENT 
 The Optionee acknowledges receipt of a copy of the Plan, a copy of which is attached hereto, and represents that he or she has read and is familiar with the terms and provisions thereof and hereby accepts
this Option subject to all of the terms and provisions of the Award Agreement and the Five Below, Inc. Equity Incentive Plan (the “Plan”). The Optionee hereby agrees to accept as binding, conclusive and final all decisions or
interpretations of the Board or the Committee upon any questions arising under the Plan. 
  

							
				
	Date: June 4, 2012	 		 		 	/s/ David Johnston
		 		 		 	Signature of Optionee
				
		 		 		 	David Johnston
		 		 		 	Name of Optionee

  

  
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 CONSENT OF SPOUSE 

I, Michelle Leonatti, spouse of David Johnston, have read the foregoing Non-Qualified Stock Option Agreement (the
“Agreement”). I am aware by the terms of the Agreement, among other things, my spouse agrees to sell certain of his/her shares of the capital stock of the Company, including my community property or other interest therein (if any),
upon certain events and that transfer of such shares is otherwise restricted. I hereby consent to such sale and to such restrictions, approve of the provisions of the Agreement, and agree that if I pre-decease my spouse, the successors of my
community property or other interest (if any) in such shares will hold such shares subject to the provisions of the Agreement. In consideration of the grant of shares of FIVE BELOW, INC. as set forth in that Agreement, I hereby appoint my spouse as
my attorney-in-fact with respect to the exercise of any rights under the Agreement and agree to be bound by the provisions of the Agreement insofar as I may have any rights in said Agreement or any shares issued pursuant thereto under the community
property laws or similar laws relating to marital property. 
  

	
	
	Michelle Leonatti
	SIGNATURE OF SPOUSE
	
	
	June 4, 2012
	DATE

  
 -8-Letter of Appointment - Sir Peter Gershon

 EXHIBIT 4(c).10 
  

			
	 

	  	

 Sir Peter Oliver Gershon CBE 
 Old Rafters, 
 Magpie Lane, 
 Coleshill, 
 Amersham, 
 Buckinghamshire 
 HP7 0LU 
 1 August 2011 
 Dear Sir Peter, 

Appointment as Non-Executive Deputy Chairman and Chairman 
 I am writing to confirm your appointment as a non-executive director of National Grid plc (the “Company”), to serve initially as Deputy Chairman and subsequently as Chairman of the Company. This
letter sets out the terms and conditions covering your appointments as follows: 
  

	 1
	 Appointment 

  

	 	 1.1.1
	 Your appointment is subject to the provisions of the Companies Act 2006, the Listing, Prospectus, Disclosure and
Transparency Rules of the Financial Services Authority, the Articles and any other laws and regulations in any applicable jurisdiction. 

  

	 	 1.1.2
	 Your appointment as a non-executive director will take effect on 1 August 2011, from which date you agree to
serve the Company initially as Deputy Chairman for a period of five months ending on 31 December 2011 and then, from 1 January 2012, you agree to serve the Company as Chairman. 

 

	 	 1.1.3
	 Under the
Articles you will be obliged to retire at the next AGM following your appointment as a non-executive director (which is expected to be held in July 2012) but will be eligible for re-election by shareholders at that meeting. Thereafter (and despite
anything to the contrary in the Articles) in line with the recommendations of the UK Corporate Governance Code, you will be required to retire at each AGM. On your retirement at any such AGM, you will be eligible for re-election unless the Board
determines otherwise, typically not later than the date of notice of any such meeting. If the Company chooses not to comply with the UK Corporate Governance Code, under the Articles you will be required to retire in the third calendar year following
the AGM at which you were first elected, or subsequently re-elected, as a director by the shareholders of the Company. 

  

	 	 1.1.4
	 The Board may require you to resign your roles as non-executive director, Deputy Chairman or Chairman at any time,
subject to six month’s written notice. 

	 2
	 Committees 

 This letter refers to your appointment as a non-executive director and Deputy Chairman and to your appointment as non-executive Chairman of the Company. 

Your appointment to committees of the Board entails separate responsibilities as detailed in the terms of reference of the relevant
committees. You will, upon appointment as Chairman, join the Nomination Committee, which you will chair and participate in key committees including Audit and Remuneration Committees, as approved by the Board from time to time. 

 

	 3
	 Time Commitment 

  

	 3.1
	 Overall we anticipate a time commitment of approximately one day per week while serving as Deputy Chairman and two days per week while serving as Chairman,
but a greater time commitment could be necessary at times, particularly when travelling on Company business or in the case of significant events such as a major transaction or other corporate action. 

 

	 3.2
	 This will include attendance at Board meetings, the AGM and other general meetings of shareholders, or any class of shareholders, separate meetings of
non-executive directors where required, and chairing or otherwise participating in, as relevant, meetings of any committees of the Board to which you are appointed or otherwise attend. 

 

	 3.3
	 In addition, you will be expected to devote appropriate preparation time ahead of each meeting and such other time as is reasonably required to discharge your
duties as a director (for example if the Company is involved in increased activity because it is involved in a major transaction). 

  

	 3.4
	 You confirm that you are able to allocate sufficient time to meet the expectations of each role to the satisfaction of the Board. The agreement of the Board
should be sought before accepting additional commitments that might affect the time you are able to devote to your role as Chairman of the Company. 

  

	 4
	 Role and Duties 

  

	 4.1
	 General Duties 

  

	 	 4.1.1
	 As Deputy Chairman, your duties will be those normally
required of a non-executive director, but will also include an active involvement in the hand-over of the duties of the Company’s current Chairman. 

 

	 	 4.1.2
	 In particular, you should have regard to the Guidance on Board Effectiveness, issued by the Financial Reporting Council in March 2011, of which an extract is
included in Schedule 2 of this letter. 

  

	 	 4.1.3
	 All directors must take decisions objectively in the interests of the Company and in compliance with their statutory and fiduciary duties and not do anything
which is harmful to the Company or its business. 

  

	 	 4.1.4
	 All directors are expected to comply with the Company’s policies, procedures, rules and regulations from time to time in force, including in particular,
the Company’s Standards of Ethical Business Conduct and its Share Dealing Code. 

  

	 4.2
	 Chairman’s Duties 

 In your role as Chairman, your duties will be those normally required of a
non-executive Chairman as summarised in Schedule 1 in addition to the general non-executive director duties referred to at 4.1.2 to 4.1.4 above and the laws, rules and other requirements in 1.1.1 above. 

 

	 5
	 Status of Appointment 

 You will not be an employee of the Company or any member of the Group and this letter shall not constitute a contract of employment. This letter sets out the only payments you will receive for performing your
duties, including any appointments to committees of the Board. Accordingly, no other remuneration or benefits will be provided and, in particular, you will not participate in any of the Company’s or Group’s remuneration or benefit
programmes, arrangements, schemes or plans, save as set out in this letter. 
  

	 6
	 Fees 

  

	 6.1
	 In consideration of your appointment as non-executive Deputy Chairman, the Company will pay you a fee of £250,000 per annum pro-rated for the
period of this appointment. 

  

	 6.2
	 In consideration of your appointment as non-executive Chairman, the Company will pay you a fee of £475,000 per annum, effective from 1 January
2012. 

  

	 6.3
	 Sub-paragraphs 6.3.1 to 6.3.5 below shall apply to your fees payable under this clause except where otherwise provided in the Articles:

  

	 	 6.3.1
	 Your fee is inclusive of service on or chairmanship, if relevant, of any Board Committee. 

 

	 	 6.3.2
	 Your fee(s) will accrue on a daily basis and will be payable on or around the 15th day of each month less any tax and national insurance contributions the Company is obliged to deduct.

  

	 	 6.3.3
	 Your fee(s) will be subject to review by the Board from time to time.

  

	 	 6.3.4
	 If for a reason related to your illness, disability or injury, you are unable to carry out your duties, payment of any fee(s) during any period of incapacity
will be at the discretion of the Board. 

  

	 	 6.3.5
	 Any specific and additional services rendered by you to the Company will be remunerated on the basis to be agreed by the Board at the time such services are
commissioned. 

  

	 7
	 Other Benefits 

  

	 7.1
	 At the Company’s discretion you will be eligible to participate in the Company’s personal accident scheme and you and your spouse will be eligible
to participate in the Company’s private medical insurance scheme, in each case on the terms agreed by the Board. The Company may amend, suspend or terminate these schemes, or any part thereof, at any time in its absolute discretion and you
shall have no continuing right to any continued participation. Membership is subject to the rules of the relevant schemes as amended from time to time. 

 

	 7.2
	 During your appointment as Chairman, the Company will provide with you with a chauffeur, car and, for business use only, reimburse fuel expenses in accordance
with the terms and conditions agreed by the Board, from time to time. Provision of this benefit is discretionary and does not form part of your contractual terms and conditions. 

	 7.3
	 You will be responsible for any income tax assessed on the benefits set out at 7.1 and 7.2 above. 

 

	 8
	 Reimbursement of Expenses 

 The Company will reimburse you in accordance with the Articles and any expenses procedures from time to time in force for any reasonable expenses properly incurred in performing your duties. All expenses must be
properly documented. 
  

	 9
	 Independent status 

  

	 9.1
	 As an independent director it is important that you remain independent in character and judgement. The Board of the Company has determined you to be
independent according to the UK Corporate Governance Code. 

  

	 9.2
	 You are required to inform the Group Company Secretary and General Counsel of any circumstances which are likely to affect, or could appear to affect,
your independence or judgement and therefore your status as an independent director. 

  

	 10
	 Outside Interests 

  

	 10.1
	 It is accepted and acknowledged that you have business interests other than those of the Company. As a condition to your appointment commencing you are
required to declare any such directorships, appointments and interests to the Board in writing. 

  

	 10.2
	 If you take on any additional interests or become aware of any potential conflicts of interests, these must be disclosed to the Group Company Secretary and
General Counsel as soon as they arise or become known to you. 

  

	 10.3
	 If at any time you are considering acquiring any new interest which might give rise to a conflict of interest with the Group you must first discuss the matter
with the Board and, if necessary, obtain its consent. Before doing so, you should discuss the matter directly with the Chief Executive, Senior Independent Director and Group Company Secretary and General Counsel. 

 

	 11
	 Confidentiality 

  

	 11.1
	 You will not use or disclose to any person, firm or organisation (except as required by law or to carry out your duties under this letter) any trade secrets,
knowhow, business information or other private or confidential information relating to the business, finances or affairs of the Company, or any customer of the Company, or any other information provided to you on the basis that it is confidential.
You will use your best endeavours to prevent the unauthorised use or disclosure of any such information. This restriction will continue to apply after your appointment ends without limit in time but will not apply to information which becomes
public, unless through unauthorised disclosure by you. After your appointment ends you will return all documents and information (whether written, visual or electronic) under your control which belong to the Company. 

 

	 11.2
	 Paragraph 11.1 will apply (with the necessary amendments) to confidential information of each company in the Group and of any other persons.

  

	 11.3
	 Your attention is drawn to the relevant legislative and regulatory requirements regarding the disclosure of inside or price sensitive information. Any
disclosure of such information must be made in accordance with and subject to the requirements set out in the Company’s Matters Reserved to the Board and/or the its Policy on the Protection and Disclosure of Price Sensitive Information as
appropriate 

	 12
	 Induction and training 

  

	 12.1
	 Immediately after appointment, the Company will provide a comprehensive, formal and tailored induction. We will also arrange for site visits and meetings with
senior and middle management and the Company’s auditors. We will also arrange meetings with major shareholders. 

 You are responsible for assessing your own on-going training needs and in compliance with the Company’s obligations under the UK Corporate Governance Code you are responsible for meeting with the other
directors regularly to discuss and agree their training and development needs. 
  

	 13
	 Review process 

 The performance of individual directors and the whole Board and its committees is evaluated annually. If, in the interim, there are any matters which cause you concern about your role while Deputy Chairman you
should discuss them with the current Chairman, and, after you have become the Chairman, you should discuss such concerns with the Chief Executive, Senior Independent Director and/or the Group Company Secretary and General Counsel as soon as is
appropriate. 
  

	 14
	 Directors’ Liability Indemnity and Insurance 

  

	 14.1
	 In the event that you are made a party or are threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative by reason of the fact that you are or were a director of the Company, the Company shall indemnify you against expenses (including legal fees) actually and reasonably incurred by you in connection with such
action, suit or proceeding and against judgments, fines and amounts paid in settlement in connection with such action, suit or proceeding to the fullest extent permitted by the Companies Act 2006 as amended and any other applicable law or
regulation, as from time to time in effect. Such right of indemnification shall be without prejudice to any other rights to which you may be entitled. The terms and conditions of this indemnity are set out in a separate deed of indemnity entered
into or to be entered into between you and the Company. 

  

	 14.2
	 The Company has directors’ and officers’ liability insurance and currently intends to maintain such cover for the full term of your appointments. A
summary of the cover is included in your Directors’ Information Pack. 

  

	 15
	 Independent professional advice 

 Occasions may arise when you consider that you need professional advice in the furtherance of your duties as a director and it will be appropriate for you to consult independent advisers at the Company’s
expense. The Company will reimburse the full cost of expenditure incurred in accordance with the UK Corporate Governance Code and any applicable Company policy. You are invited to discuss any proposed engagement with the Group Company Secretary and
General Counsel in advance. 
  

	 16
	 Disclosure and Dealings in Shares 

  

	 16.1
	 Under the Companies Act 2006, where a director of a company is in any way, directly or indirectly, interested in a proposed transaction or arrangement
with the Company or one that has been entered into by the Company, he must declare the nature and extent of that interest. You may give any such notice at a meeting of the directors, in writing or by general notice. 

	 16.2
	 During the continuance of your appointments you will be expected to comply (and to procure that your spouse and dependant children comply) where relevant with
any rule of law or regulation of any competent authority or of the Company from time to time in force in relation to dealings in shares, debentures and other securities of the Company and unpublished price sensitive information affecting the shares,
debentures and other securities of the Company. A copy of the Company’s Share Dealing Code is provided in the Directors’ Information Pack. 

  

	 16.3
	 You should also have regard to your duties as a director in light of the UKLA Listing Rules Prospectus, Disclosure and Transparency Rules and UK Corporate
Governance Code and obligations arising as a result of the Company’s American Depositary Shares (“ADSs”) being listed on the New York Stock Exchange, as set out in the relevant section in the Directors’ Information Pack.

  

	 16.4
	 The Company currently has no share ownership requirements for its non-executive directors. 

 

	 17
	 Companies House formalities 

 Form APO1, prescribed by the Companies Act 2006, has to be filed at Companies House. A copy is enclosed for you. Please complete this and return it to the Group Company Secretary and General Counsel at our
registered office. 
  

	 18
	 Termination 

  

	 18.1
	 You may resign from your appointment at any time and should you wish to do so are required to serve six months written notice on the Board.

  

	 18.2
	 Continuation of your appointment after retirement from office required under this letter or under the Articles is contingent on satisfactory performance and
on your re-election, as and when required, under the Articles. You will not be entitled to compensation if you are not re-elected by shareholders following any such retirement. 

 

	 18.3
	 Your appointment may also be terminated in accordance with the provisions of the Articles. 

 

	 19
	 Definitions 

 In this letter: 
  

	 19.1
	 “AGM” means the Company’s Annual General Meeting; 

 

	 19.2
	 “Articles” means the Company’s Articles of Association from time to time in force; 

 

	 19.3
	 “Group” means the Company and any subsidiary or subsidiary undertaking or holding company (as defined in the Companies Acts 2006) of the
Company and any subsidiary or subsidiary undertaking or holding company of any subsidiary or subsidiary undertaking or holding company of the Company; and 

 

	 19.4
	 “Listing Rules” means the listing rules made by the Financial Services Authority in exercise of its functions as competent authority pursuant
to Part VI of the Financial Services and Markets Act 2000. 

  

	 20
	 Governing Law 

 This letter and any non-contractual obligations arising out of or in connection with it is governed by and will be interpreted in accordance with the laws of England and Wales. Each of the parties submits to the
exclusive jurisdiction of the Courts of England and Wales as regards any claim or matter arising under this letter. 

 Please acknowledge receipt and acceptance of the above terms by signing and returning the enclosed
copy of this letter. 
 Yours sincerely 
  

	
	 /s/_Ken
Harvey                                        
                         

 Ken Harvey 
 Senior Independent Director 
 For and on behalf of National Grid plc 

I hereby acknowledge receipt of and accept the terms set out in this letter. 

Signed /s/ Sir Peter Oliver Gershon ..................................... 

Dated 1 August 2011.......... 

 Schedule 1 
 Role of Chairman (extracted from the March 2011 FRC Guidance on Board Effectiveness) 
 The
Chairman’s role includes: 
  

	 •
	 	 demonstrating ethical leadership; 

  

	 •
	 	 setting a board agenda which is primarily focused on strategy, performance, value creation and accountability and ensuring that issues relevant to these areas
are reserved for board decision; 

  

	 •
	 	 ensuring a timely flow of high quality supporting information; 

 

	 •
	 	 making certain that the board determines the nature, and extent, of the significant risks the company is willing to embrace in the implementation of its
strategy, and that there are no ‘no go’ areas which prevent directors from operating effective oversight in this area; 

  

	 •
	 	 regularly considering succession planning and the composition of the board; 

 

	 •
	 	 making certain that the board has effective decision-making processes and applies sufficient challenge to major proposals; 

 

	 •
	 	 ensuring the board’s committees are properly structured with appropriate terms of reference; 

 

	 •
	 	 encouraging all board members to engage in board and committee meetings by drawing on their skills, experience, knowledge and, where appropriate,
independence; 

  

	 •
	 	 fostering relationships founded on mutual respect and open communication – both in and outside the boardroom – between the non-executive directors
and the executive team; 

  

	 •
	 	 developing productive working relationships with all executive directors, and the CEO in particular, providing support and advice while respecting executive
Responsibility; 

  

	 •
	 	 consulting the senior independent director on board matters in accordance with the Code; 

 

	 •
	 	 taking the lead on issues of director development, including through induction programmes for new directors and regular reviews with all directors;

  

	 •
	 	 acting on the results of board evaluation; 

  

	 •
	 	 being aware of, and responding to, his or her own development needs, including people and other skills, especially when taking on the role for the first time;
and 

  

	 •
	 	 ensuring effective communication with shareholders and other stakeholders and, in particular, that all directors are made aware of the views of those who
provide the company’s capital. 

 Schedule 2 
 Guidance for Non-Executive Directors 
 (extracted from the March 2011 FRC Guidance on Board
Effectiveness) 
 A non-executive director should, on appointment, devote time to a comprehensive, formal and tailored induction which
should extend beyond the boardroom. Initiatives such as partnering a non-executive director with an executive board member may speed up the process of him or her acquiring an understanding of the main areas of business activity, especially areas
involving significant risk. The director should expect to visit, and talk with, senior and middle managers in these areas. 

Non-executive directors should devote time to developing and refreshing their knowledge and skills, including those of communication, to ensure
that they continue to make a positive contribution to the board. Being well-informed about the company, and having a strong command of the issues relevant to the business, will generate the respect of the other directors. 

Non-executive directors need to make sufficient time available to discharge their responsibilities effectively. The letter of appointment should
state the minimum time that the non-executive director will be required to spend on the company’s business, and seek the individual’s confirmation that he or she can devote that amount of time to the role, consistent with other
commitments. The letter should also indicate the possibility of additional time commitment when the company is undergoing a period of particularly increased activity, such as an acquisition or takeover, or as a result of some major difficultly with
one or more of its operations. 
 Non-executive directors have a responsibility to uphold high standards of integrity and probity. They
should support the chairman and executive directors in instilling the appropriate culture, values and behaviours in the boardroom and beyond. 
 Non-executive directors should insist on receiving high-quality information sufficiently in advance so that there can be thorough consideration of the issues prior to, and informed debate and challenge at, board
meetings. High-quality information is that which is appropriate for making decisions on the issue at hand – it should be accurate, clear, comprehensive, up-to-date and timely; contain a summary of the contents of any paper; and inform the
director of what is expected of him or her on that issue. 
 Non-executive directors should take into account the views of shareholders
and other stakeholders, because these views may provide different perspectives on the company and its performance.

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