Document:

Exhibit 4.16

 	  Exhibit 4.16

 

	National Grid Transco	1-3 Strand	 T +44
        (0) 20 7004 3000
	London WC2N 5EH	F +44 (0) 20 7004
        3004
	  	www.ngtgroup.com

 

	5th June 2003	 
	 	Sir John Parker
        FREng

        Chairman
    
	 	 
	 	D: +44 (0) 20
        7004 3010
	Mr James Ross	F: +44 (0) 20
        7004 3012
	Olive Hill	M: +44 (0) 7831
        496201
	Wyck Rissington

      Near Cheltenham

      Gloucestershire

    GL54 2PW	john.parker@ngtgroup.com
	 	 
	 	 
	 	 

	Dear	
	With reference to your letter
        of appointment dated 4th March 1999 as amended by the letter
        dated 24th October 2001, I am writing to confirm the terms
        of your appointment as a Non-Executive Director and Deputy Chairman of
        National Grid Transco plc (the "Company") with effect from
        1 April 2003. You will also be the senior independent Non-Executive Director
        on the Board. It is agreed that this is a contract for services and is
    not a contract of employment.

Appointment

Your appointment, which commenced on 1st March
    1999, currently ends at the Company's AGM in 2004, unless otherwise terminated
    earlier in accordance with the Company's Articles of Association or by and
    at the discretion of either party upon one month's written notice. Continuation
    of your contract of appointment is contingent on satisfactory performance
    and re­election at forthcoming AGMs. In the unlikely event that shareholders do not support your appointment or other shareholder action terminates your appointment before the 2004 AGM, you will not be entitled to receive damages for breach of contract. As you know, it is Board policy that Non­Executive
    Directors are typically expected to serve two three-year terms; any extension
    to this is subject to review by the Nominations Committee (prior to making
    recommendations to the Board) in the light of good corporate governance policy
at the time.

Time Commitment

Overall we anticipate a time commitment of approximately 1 day per week on average taking account reading and preparation time for Board and Committee meetings. This will include attendance at Board meetings (estimated 9 scheduled meetings per annum of which 2-3 per annum will be in the USA) plus ad hoc and emergency meetings, the AGM, any extraordinary general meetings, 2 Board strategy sessions and at least one site visit per year. It is planned that certain Board meetings will be held out of London at the Company's operations (in the UK and USA).

By confirming this appointment, you have agreed that you are able to allocate sufficient time to meet the expectations of your role including appropriate preparation time. The agreement of the Chairman should be sought before

	 	National Grid Transco
        plc
	Registered Office: 1-3 Strand,
        London WC2N 5EH
	Registered in England and Wales,
        No 4031152

 

accepting additional commitments
    that might affect the time you are able to devote to your role as a Non-Executive
Director and Deputy Chairman of the Company.

You should also have regard
    to your duties as a director in light of the UK Listing Rules and Combined
    Code and obligations arising as a result of the Company's shares being listed
    on the New York Stock Exchange, as set out in the relevant section in the
    Directors' Information Pack. You will also be subject to the Company's Share
    Dealing Code as set out in the Directors Information Pack.

	Role

    Non-Executive Directors have the same
  general legal responsibilities to the Company as any other director. The Board
  as a whole is collectively responsible for promoting the success of the Company
  by directing and supervising the Company's affairs. The Board:
	•	
provides effective business leadership of the Company within a framework of prudent and effective controls which enable risk to be assessed and managed;

	•	
sets the Company's strategic aims, ensures that the necessary financial and human resources are in place for the Company to meet its objectives, and reviews management performance; and

	•	
sets the Company's values and standards and
ensures that its obligations to its shareholders and others are understood and
met.

	 
	In addition to these requirements
    of all directors, the role of the non-executive has the following key elements:
	•	
Strategy: Non-Executive Directors should constructively challenge and contribute to the development of strategy;

	•	
Performance: Non-Executive Directors should scrutinise the performance of management in meeting agreed goals and objectives and monitor the reporting of performance;

	•	
Risk: Non-Executive Directors should satisfy themselves that the financial function of the Company is professionally managed and that financial controls and systems of risk management are robust and defensible; and

	•	
People: Non-Executive Directors are responsible for determining appropriate levels of remuneration of executive directors and have a prime role in appointing, and where necessary removing, senior management and in succession planning.

Committees

This letter refers to your appointment as a Non-Executive Director and Deputy Chairman of the Company. You have also been requested to serve on the Nominations Committee and be chairman of the Risk and Responsibility Committee.

Fees

You
    will be paid an annual fee of £115,000 gross per annum which will be
    paid monthly in arrears which includes fees for your chairmanship of the
    Risk and Responsibility Committee. You will not receive any additional fees
    for membership of, or attendance at, any Board Committee meetings. The Company
will reimburse you for all reasonable and properly documented

 

expenses you incur in performing
    the duties of your office. The Board shall review the above fees from time
    to time and they are therefore subject to change. All fees and payments will
be made subject to any deductions required to be made by the Company.

Outside Interests

  It is accepted and acknowledged
        that you have business interests other than those of the Company and have
        declared any conflicts that are apparent at present. In the event that you
        become aware of any potential conflicts of interest, these should be disclosed
  to the Chairman and/or Company Secretary as soon as apparent.

The Board of the Company have
      determined you to be independent according to the provision of the Combined
  Code.

Confidentiality     

  You will, naturally, during your appointment and following its termination not disclose or communicate to any person (except as required by law or in the course of the proper performance of your duties, or with the consent of the Board of Directors) nor use for your own account or advantage any confidential information relating to the Company or any of its subsidiary or associate companies which you obtained during your appointment or otherwise.

You will be required to return all papers containing confidential information on termination of the appointment.

Your attention is also drawn to the requirements under both legislation and regulation as to the disclosure of price sensitive information. Consequently you should avoid making any statements that might risk a breach of these requirements without prior clearance from the Chairman or Company Secretary.

Induction

You have already been provided with an introduction to the Company and its businesses and detailed information on a variety of areas plus a directors' information pack. We have also arranged for various site visits and meetings with senior and middle management and the Company's advisors. We will also arrange for you to meet major investors as appropriate.

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 you should discuss them with the Chairman as soon as is appropriate.

Insurance

The Company has directors' and officers' liability insurance and it is intended to maintain such cover for the full term of your appointment. A summary of the cover is included in your directors' information pack.

 

Independent Professional Advice

Occasions may arise when you consider that
    you need professional advice in the furtherance of your duties as a director.
    Circumstances may occur when it will be appropriate for you to seek advice
    from independent advisors at the Company's expense. Please advise either
    the Chairman or the Company Secretary should you seek such advice. The Company
    will reimburse the full cost of expenditure incurred in accordance in respect
of such advice.

Indemnity

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 1985 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.

Governing Law

The agreement contained in this letter shall
    be governed by, and construed in accordance with, English law and shall be
subject to the exclusive jurisdiction of the English courts.

Entire Agreement

This appointment letter represents the entire
    understanding, and constitutes the whole agreement, in relation to the Appointment
    and supersedes any previous agreement between yourself and the Company with
respect thereto.

On a personal level, I am delighted that
    you are continuing to serve on the Board of National Grid Transco plc and
I look forward to our continuing working relationship.

Yours sincerely

Sir John Parker

  Chairman

Agreed and Accepted by

17.6.03

James RossExhibit 4.19

Exhibit 4.19

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NATIONAL GRID TRANSCO PLC

 

THE RULES OF 

  THE PERFORMANCE SHARE PLAN

	Date approved
        by shareholders: 	23
        July 2002
	 	 
	Date adopted
        by the Board:	17 October
        2002
	 	 
	Date amended
        by the Share Schemes Sub-Committee	26 June 2003
	 	 
	Date amended
        by the Share Schemes Sub-Committee	5 May 2004 

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The National Grid Transco
      Plc Performance Share Plan

	 1.	 Definitions and Interpretation
	 	 

	(1)	 In this Plan, unless the context otherwise
        requires:
	 	 

	 	“ADS” means
        an American depository share representing ordinary shares of the Company;
	 	 

	 	“Award” means
        a Share Right or an Option;
	 	 

	 	the “Board” means
        the board of directors of the Company;
	 	 

	 	the “Committee” means
        the Remuneration Committee of the Board, consisting exclusively of non-executive
        directors of the Company or if any of the events envisaged in Rules 7(1),
        7(3) or 7(4) occurs then the Remuneration Committee as constituted immediately
        before such event occurred;
	 	 

	 	the “Company” means
        National Grid Transco plc (registered in England and Wales No. 4031152);
	 	 

	 	the “Grant Date” means
        in relation to an Award the date on which the Option or Share Right (as
        appropriate) was granted;
	 	 

	 	“Group Member” means:
	 	 

		 (a)	 a Participating Company or a body corporate
        which is (within the meaning of section 736 of the Companies Act 1985)
        the Company’s holding company or a subsidiary of the Company’s
        holding company; or
		 	 

		 (b)	 a body corporate which is (within the
        meaning of section 258 of the Companies Act 1985) a subsidiary undertaking
        of a body corporate within paragraph (a) above and has been designated
        by the Board for this purpose;
		 	 

	 	the “Listing Rules” means
        the listing rules made by the competent authority for the purposes of
        Part VI of the Financial Services and Markets Act 2000;
	 	 

	 	the “London Stock
          Exchange” means London Stock Exchange plc;
	 	 

	 	the “Merger” means
        the merger between the Company and Lattice Group plc;
	 	 

	 	the “Model Code” means
        the Model Code on directors’ dealings in securities as set out
        in the Appendix to Chapter 16 to the Listing Rules;
	 	 

	 	“Option” means
        an option to acquire (whether by subscription or purchase) Shares in
        the Company granted under the Plan;
	 	 

	 	“Participant” means
        a person who holds an Award;
	 	 

	 	“Participating
          Company” means the Company or any Subsidiary or any company
          which is not under the control of any single person, but is under the
          control of two persons (within the meaning of section 840 of the Taxes
          Act 1988), one of them being the Company, and to which the Board has
          resolved that this Plan shall for the time being extend;
	 	 

	 	“Performance Condition” means
        a condition related to performance which is specified by the Committee
        under Rule 3(1);
	 	 

	 	the “PIan” means
        the National Grid Transco plc Performance Share Plan as herein set out
        but subject to any alterations or additions made under Rule 10 below;

	

    
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	 	“Shares” means
        ordinary shares in the capital of the Company or, as the context requires,
        ADSs;
	 	 

	 	“Share Right” means
        a conditional right to receive Shares in the Company upon the terms and
        conditions set out in the Plan;
	 	 

	 	“Subsidiary” means
        a body corporate which is a subsidiary of the Company (within the meaning
        of section 736 of the Companies Act 1985);
	 	 

	 	the “Takeover
          Code” means the Code on Takeovers and Mergers issued by the
          Panel on Takeovers and Mergers, as from time to time modified, extended
          or reissued;
	 	 

	 	the “Taxes Act
          1988” means the Income and Corporation Taxes Act 1988; and
	 	 

	 	the “Trustees” means
        the trustee or trustees for the time being of any trust established for
        the benefit of all or most of the employees of the Company and/or its
        Subsidiaries.
	 	 

	 (2)	 Any reference in this Plan to any enactment
        includes a reference to that enactment as from time to time modified,
        extended or re-enacted.
	 	 

	 (3)	 Words of the feminine gender shall
        include the masculine and vice versa unless, in either case, the context
        requires otherwise or is otherwise stated.
	 	 

	 (4)	 Expressions in italics are for guidance
        only and do not form part of this Plan.
	 	 

	 2.	 Eligibility
	 	 

	 	A person is eligible to
        be granted an Award if (and only if) he is an employee (including a director
        who is also an employee) of a Participating Company.
	 	 

	 3.	 Grant of Awards
	 	 

	 (1)	 The Committee or the Trustees may by
        deed (but, in the case of the Trustees, only following a recommendation
        of the Committee) grant an Award over Shares upon the terms set out in
        this Plan and upon such other terms including Performance Conditions
        as the person granting the Award may specify to any person who is eligible
        to be granted an Award in accordance with Rule 2 above.
	 	 

	 (2)	 Subject to sub-rules 5(5), 6(4) and
        7(5), unless the Committee determines otherwise prior to or on the Grant
        Date, the Performance Condition shall be measured over a three year period
        ending on or before the third anniversary of the Grant Date.
	 	 

	 (3)	 If, after the Committee or the Trustees
        (as the case may be) have imposed a Performance Condition, events happen
        which causes the Committee to consider that it is no longer appropriate
        the Committee may vary such condition provided always that any such amendment
        may only be one which the Committee reasonably considers will result
        in a fairer measure of the performance, will ensure that this Plan operates
        more effectively in the achievement of its purpose of providing share
        benefits for employees who contribute to the prosperity of the Company
        and its shareholders, and will be neither substantially more nor less
        difficult to satisfy than the original condition was intended to be at
        the time of its grant.

	

    
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	 (4)	 Whether an Award is an Option, or a
        Share Right shall be determined by the Committee and stated at the Grant
        Date. The Committee may determine to grant an Award to acquire ADSs and
        references in these rules to Shares shall be construed accordingly.
	 	 

	 (5)	 The price (if any) at which Shares
        may be acquired pursuant to an Award shall be determined by the Committee
        and stated at the Grant Date.
	 	 

	 (6)	 An Award granted to any person:
	 	 

	  	 (a)	 shall not be capable of being transferred
        by him, other than to his personal representatives following death; and
	 	 	 

	  	 (b)	 shall lapse forthwith if he is adjudged
        bankrupt.
	 	 	 

	 (7)	 An Award may only be granted:
	 	 

	  	 (a)	 within the period of six weeks beginning
        with:
	 	 	 

	  	  	 (i)	 the completion of the Merger; or
	 	 	 	 

	  	  	 (ii)	 the dealing day next following the
        date on which the Company announces its results for any period; or
	 	 	 	 

	  	 (b)	 at any other time when the circumstances
        are considered by the Committee to be sufficiently exceptional to justify
        its grant; and
	 	 	 

	  	 (c)	 within the period of 10 years beginning
        with the date on which this Plan is adopted by the Company.
	 	 	 

	 (8)	 The grant of an Award shall be subject
        to the provisions of the Model Code and to obtaining any approval or
        consent required under the provisions of the Listing Rules or the Takeover
        Code, or of any other enactment or regulation applicable to such grant.
	 	 

	 4.	 Limits
	 	 

	 (1)	 No Awards shall be granted in any year
        which would, at the time they are granted, cause the number of Shares
        in the Company which shall have been or may be issued in pursuance of
        options granted in the period of 10 calendar years ending with that year,
        or been issued in that period otherwise than in pursuance of options,
        under this Plan or under any other executive share scheme adopted by
        the Company or a Subsidiary to exceed such number as represents 5 per
        cent. of the ordinary share capital of the Company in issue at that time.
	 	 

	 (2)	 No Awards shall be granted in any year
        which would, at the time they are granted, cause the number of Shares
        in the Company which shall have been or may be issued in pursuance of
        options granted in the period of 10 calendar years ending with that year,
        or been issued in that period otherwise than in pursuance of options,
        under this Plan or under any other employees’ share scheme adopted
        by the Company or a Subsidiary to exceed such number as represents 10
        per cent. of the ordinary share capital of the Company in issue at that
        time.
	 	 

	 (3)	 No person shall be granted Awards which
        would, at the time they are granted, cause the aggregate market value
        of the Shares which he may acquire in pursuance of Awards granted to
        him under the Plan in any financial year of the Company to exceed 125 per cent.
        of the annual base salary of such person, and for the purposes of this
        sub-rule:

	

    
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		 (a)	 a person’s base salary shall
        be taken to be his current base salary (excluding benefits in kind) expressed
        as an annual rate in respect of the financial year of the Company in
        which the Grant Date of the Award falls; and
		 	 

		 (b)	 where a payment of remuneration is
        made otherwise than in sterling, the payment shall be treated as being
        of the amount of sterling ascertained by applying such rate of exchange
        as published in a national newspaper on the Grant Date as the Committee
        shall reasonably determine.
		 	 

	 (4)	 For the purposes of this Rule, the
        market value of the Shares in relation to which an Award was granted
        shall be calculated by reference to the market value of the Shares on
        the Grant Date.
	 	 

	 (5)	 References in this Rule 4 to Shares
        being issued pursuant to the exercise of options shall include any Shares
        issued for the purpose of satisfying any such option.
	 	 

	 (6)	 For the purposes of sub-rules (1) and
        (2) above, any shares in National Grid Holdings One plc (company number
        2367004) which have been issued (or remain issuable) under any executive
        or employees’ share scheme (as the case may be) shall be treated
        as Shares in the Company, subject to the proviso that:
	 	 

	  	 (a)	 any Shares issued or issuable pursuant
        to any options granted as “Replacement Options” under paragraph
        (f) of the Unapproved Appendix to the National Grid Executive Share Option
        Scheme (1990) shall be regarded as having been granted on the date that
        the “1998 Option” (as that term is defined in such paragraph)
        to which they relate was granted; and
	 	 	 

	  	 (b)	 any Shares issued or issuable pursuant
        to any option granted under The National Grid Company PLC’s 1995
        Unapproved Savings Related Share Option Scheme and any corresponding
        option granted under The National Grid Company PLC’s Savings Related
        Share Option Scheme established in 1990 shall be treated as a single
        option in recognition that only one or other, but not both, of such options
        may be exercised.
	 	 	 

	 5.	 Exercise of Options
	 	 

	 (1)	 The exercise of any Option shall be
        effected in the form and manner prescribed by the Board.
	 	 

	 (2)	 Subject to sub-rule (4) below and to
        Rules 7(1), 7(3) and 7(4) below, an Option may not be exercised before
        the fourth anniversary of the Grant Date and subject to sub-rule (10)
        below, an Option may be exercised in the three months following the fourth
        anniversary of the Grant Date.
	 	 

	 (3)	 Subject to sub-rule (4) below and to
        Rule 7(5) below, an Option may not be exercised if the Performance Condition
        (if any) applicable to that Option is not satisfied.
	 	 

	 (4)	 Subject to sub-rules (5) and (6) below,
        if any Participant ceases to be a director or employee of a Group Member,
        the following provisions apply in relation to any Option granted to him:
	 	 

	 	 (a)	 if he so ceases by reason of death,
        unless the Committee determines otherwise, any Option granted to him
        may (and must, if at all) be exercised by his personal representatives
        within 12 months after the date of his death, provided that his death
        occurs at a time when either he is a director or employee of a Group
        Member or he is entitled to exercise the Option by virtue of this sub-rule
        5(4);

	

    
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		 (b)	 if he so ceases by reason of injury,
        disability, pregnancy or redundancy (within the meaning of the Employment
        Rights Act 1996), or by reason only that his office or employment is
        in a company which ceases to be a Group Member, or relates to a business
        or part of a business which is transferred to a person who is not a Group
        Member, unless the Committee determines otherwise, the Option may (and
        subject to paragraph (a) above must, if at all) be exercised, within
        the exercise period;
		 	 

		 (c)	 if he so ceases by reason of retirement
        on reaching the age at which he is bound to retire in accordance with
        the terms of his contract of employment, unless the Committee determines
        otherwise, the Option may (and subject to paragraph (a) above must, if
        at all) be exercised within the exercise period;
		 	 

		 (d)	 if he so ceases for any other reason
        before the third anniversary of the Grant Date, the Option may not be
        exercised at all unless the Committee shall so permit, in which event
        it may (and subject to paragraph (a) above must, if at all) be exercised
        to the extent permitted by the Committee within the exercise period;
		 	 

	 	and in paragraphs (b),
        (c) and (d) of this sub-rule the exercise period is the period
        which shall expire 12 months in the cases where paragraphs (b) or (d)
        above apply or six months in cases where paragraph (c) above applies
        after his so ceasing, or such later date as the Committee may determine.
	 	 

	 (5)	 In relation to an Option which would
        be exercisable by virtue of an event mentioned in sub-rule (4) above,
        that Option shall become exercisable in respect of a number of Shares
        (if any) calculated on the following basis:
	 	 

	  	 (a)	 by determining the extent to which
        the Performance Condition has been satisfied on the last occasion on
        which the Performance Condition was measured before the date on which
        such event occurs in respect of the Option; and
	 	 	 

	  	 (b)	 by applying a pro rata reduction of
        the number of Shares determined under paragraph (a) above on the basis
        of the number of complete months for which the Option has been subsisting
        bears to 36 months,
	 	 	 

	 	unless the Committee decides
        that this sub-rule (5) operates unfairly in the circumstances in which
        case it may, in its discretion, determine that the Option should be treated
        in such other manner as it so decides.
	 	 

	 (6)	 If any Participant ceases to be a director
        or employee between the third and fourth anniversaries of the Grant Date,
        the following provisions will apply in relation to any Option granted
        to him:
	 	 

	  	 (a)	 if he so ceases for a reason specified
        in paragraphs (a), (b) or (c) of sub-rule (4) above, the provisions of
        those paragraphs will apply;
	 	 	 

	  	 (b)	 if he so ceases for any other reason
        (other than dismissal for misconduct), any Option in respect of which
        the Performance Condition has been satisfied may be exercised in accordance
        with sub-rule (2) above; and
	 	 	 

	  	 (c)	 if he so ceases by reason of dismissal
        for misconduct, the Option will lapse forthwith.

	

    
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	 (7)	 A Participant shall not be treated
        for the purposes of sub-rule (4) above as ceasing to be a director or
        employee of a Group Member until such time as he is no longer a director
        or employee of any Group Member.
	 	 

	 (8)	 Notwithstanding any other provision
        of the Plan, an Option may not be exercised after the expiration of the
        period of 10 years (or such shorter period as the Committee may have
        determined before its grant) beginning with the Grant Date.
	 	 

	 (9)	 Within 30 days after an Option has
        been exercised by any person, the grantor of the Option shall procure
        the transfer to him (or a nominee for him) of the number of Shares in
        respect of which the Option has been exercised, provided that:
	 	 

	  	 (a)	 the Board considers that the transfer
        thereof would be lawful in all relevant jurisdictions; and
	 	 	 

	  	 (b)	 in a case where a Group Member or the
        Trustees is obliged to (or would suffer a disadvantage if they were not
        to) account for any tax (in any jurisdiction) and/or for any social security
        contributions recoverable from the person in question and/or any employer’s
        social security/National Insurance contributions which the person has
        agreed to pay (together, the “Tax Liability”) for
        which the person in question is liable by virtue of the exercise of the
        Option, that person has either:
	 	 	 

	  	  	 (i)	 made a payment to the Group Member
        or the Trustees of an amount equal to the Tax Liability; or
	 	 	 	 

	  	  	 (ii)	 entered into arrangements acceptable
        to that Group Member, the Trustees or another Group Member to secure
        that such a payment is made (whether by authorising the sale of some
        or all of the Shares on his behalf and the payment to the relevant person
        of the relevant amount out of the proceeds of sale or otherwise).
	 	 	 	 

	 (10)	 The exercise of any Option and the
        transfer of Shares under the Plan shall be subject to the provisions
        of the Model Code and to obtaining any approval or consent referred to
        in Rule 3(8) above. Where the transfer of Shares pursuant to an Award
        is prohibited pursuant to the Model Code at any time, such transfer shall
        instead take place as soon as reasonably practicable after it is no longer
        prohibited by the Model Code.
	 	 

	 (11)	 Any Shares issued under this Plan in
        respect of Options shall rank equally in all respects with Shares of
        the same class then in issue except for any rights attaching to those
        Shares by reference to a record date prior to the date of allotment.
	 	 

	 6.	 Vesting of Share Rights
	 	 

	  	 (1)	 Subject to sub-rules (3) below and
        to Rules 7(1), 7(3) and 7(4) below, the grantor of a Share Right (the “Grantor”)
        shall procure that the Shares subject to the Share Right are transferred
        to a Participant as soon as reasonably practicable after the fourth anniversary
        of the Grant Date.
	 	 	 

	  	 (2)	 Subject to sub-rule (3) below and to
        Rule 7(5) below, no Shares shall be transferred pursuant to sub-rule
        (1) above in respect of a Share Right unless the Performance Condition
        (if any) applicable to that Share Right is satisfied.

	

    
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	 (3)	 Subject to sub-rules (4) and (5) below,
        if any Participant ceases to be a director or employee of a Group Member,
        the following provisions apply in relation to any Share Right granted
        to him:
	 	 

	  	 (a)	 if he so ceases by reason of death,
        unless the Committee determines otherwise, the Grantor will procure that
        Shares will be transferred to his personal representatives within 12
        months after the date of his death, provided that his death occurs at
        a time when either he is a director or employee of a Group Member or
        he is entitled to receive a transfer of Shares by virtue of this sub-rule 6(3);
	 	 	 

	  	 (b)	 if he so ceases by reason of injury,
        disability, pregnancy or redundancy (within the meaning of the Employment
        Rights Act 1996), or by reason only that his office or employment is
        in a company which ceases to be a Group Member, or relates to a business
        or part of a business which is transferred to a person who is not a Group
        Member, unless the Committee determines otherwise, the Grantor will procure
        that Shares will be transferred to him (and subject to paragraph (a)
        above must, if at all) within the transfer period;
	 	 	 

	  	 (c)	 if he so ceases by reason of retirement
        on reaching the age at which he is bound to retire in accordance with
        the terms of his contract of employment, unless the Committee determines
        otherwise, the Grantor will procure that Shares will be transferred to
        him, (and subject to paragraph (a) above must, if at all) within the
        transfer period;
	 	 	 

	  	 (d)	 if he so ceases for any other reason
        before the third anniversary of the Grant Date, the Share Right will
        lapse unless the Committee determines otherwise, in which event the Grantor
        will procure that Shares will be transferred to him (and subject to paragraph
        (a) above must, if at all) within the transfer period to the extent permitted
        by the Committee;
	 	 	 

	 	and in paragraphs (b),
        (c) and (d) of this sub-rule the transfer period is the period
        which shall expire 12 months in the cases where paragraphs (b) or (d)
        above apply or six months in cases where paragraph (c) above applies
        after his so ceasing, or such later date as the Committee may determine.
	 	 

	 (4)	 In relation to Shares which would be
        transferred to a Participant by virtue of an event mentioned in sub-rule
        (3) above, the number of Shares (if any) which will be transferred will
        be calculated on the following basis:
	 	 

	  	 (a)	 by determining the extent to which
        the Performance Condition has been satisfied on the last occasion on
        which the Performance Condition was measured before the date on which
        such event occurs in respect of the Share Right; and
	 	 	 

	  	 (b)	 by applying a pro rata reduction to
        the number of Shares determined under paragraph (a) above on the basis
        of the number of complete months for which the Share Right has been subsisting
        bears to 36 months,
	 	 	 

	 	unless the Committee decides
        that this sub-rule (4) operates unfairly in the circumstances in which
        case it may, in its discretion, determine that the Share Right should
        be treated in such other manner as it so decides.

	

    
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	 (5)	 If any Participant ceases to be a director
        or employee between the third and fourth anniversaries of the Grant Date,
        the following provisions apply in relation to any Share Right granted
        to him:
	 	 

	  	 (a)	 if he so ceases for a reason specified
        in paragraphs (a), (b) or (c) of sub-rule (3) above, the provisions of
        those paragraphs will apply;
	 	 	 

	  	 (b)	 if he so ceases for any other reason
        (other than dismissal for misconduct), the Grantor will procure that
        Shares will be transferred to him in respect of a Share Right for which
        the Performance Condition has been satisfied in accordance with sub-rule
        (1) above; and
	 	 	 

	  	 (c)	 if he so ceases by reason of dismissal
        for misconduct, the Share Right shall lapse forthwith.
	 	 	 

	 (6)	 A Participant shall not be treated
        for the purpose of sub-rule (3) of this Rule as ceasing to be a director
        or employee of a Group Member until such time as he is no longer a director
        or employee of any Group Member.
	 	 

	 (7)	 No transfer of Shares shall be made
        under the Plan if the Board considers that it would not be lawful or
        practicable in the relevant jurisdiction.
	 	 

	 (8)	 Where the Grantor is required to procure
        a transfer of Shares comprised in a Share Right to a Participant pursuant
        to this Rule 6 and where the Trustees or a Group Member are obliged to
        (or would suffer a disadvantage if they were not to) account for any
        tax (in any jurisdiction) and/or for any social security contributions
        recoverable from the Participant and/or any employer’s social security/National
        Insurance Contributions which the Participant has agreed to pay (together,
        the “Tax Liability”) and for which the Participant
        is liable by virtue of the transfer of the Shares, the Grantor shall
        be entitled to procure the sale of sufficient Shares combined in the
        Share Right to satisfy such Tax Liability unless they or a Group Member
        has received on or prior to the transfer of the Shares a payment from
        the Participant of an amount not less than the Tax Liability or unless
        the Participant has entered into arrangements acceptable to the Trustees
        or a Group Member to ensure that such a payment is made (whether by authorising
        the sale of some or all of the Shares on his behalf and the payment to
        the relevant person of the amount equal to the Tax Liability out of the
        proceeds of sale or otherwise).
	 	 

	 (9)	 Notwithstanding any other provision
        of this Plan, if a Tax Liability has (as defined in sub-rule (8) above)
        arisen prior to a transfer of Shares to a Participant in respect of a
        Share Right then the Grantor shall have authority to procure the sale
        of sufficient of the Shares to discharge the Tax Liability and the number
        of Shares comprised in the Share Right shall be reduced accordingly.
	 	 

	 (10)	 The transfer of Shares under the Plan
        shall be subject to the provisions of the Model Code and to obtaining
        any approval or consent referred to in Rule 3(8) above. Where the transfer
        of Shares pursuant to a Share Right is prohibited pursuant to the Model
        Code at any time, such transfer shall instead take place as soon as reasonably
        practicable after it is no longer prohibited by the Model Code.
	 	 

	 (11)	 Any Shares issued under this Plan in
        respect of Share Rights shall rank equally in all respects with Shares
        of the same class then in issue except for any rights attaching to those
        Shares by reference to a record date prior to the date of allotment.

	

    
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	 7.	 Takeover, Reconstruction and Winding-up
	 	 

	 (1)	 Subject to sub-rules (5) and (7) below,
        if any person obtains control of the Company (within the meaning of section
        840 of the Taxes Act 1988) as a result of making a general offer to acquire
        Shares in the Company, or having obtained control makes such an offer,
        the Committee shall within seven days of becoming aware thereof notify
        every Participant thereof and,
	 	 

	  	 (a)	 in respect of an Option, subject to
        earlier lapse under Rule 5(4), any Option may be exercised within one
        month (or such longer period up to a maximum of six months as the Committee
        may permit) of the notification but to the extent that it is not exercised
        within that period shall lapse on the expiry of that period; and
	 	 	 

	  	 (b)	 in respect of a Share Right, procure
        the transfer to a Participant of the Shares subject to a Share Right
        as soon as reasonably practicable even if no obligation to procure a
        transfer under Rule 6(1) above has arisen (but not if the Share Right
        has lapsed pursuant to Rule 6(3) above or the relevant Shares have already
        been transferred to the Participant).
	 	 	 

	 (2)	 For the purposes of sub-rule (1) above,
        a person shall be deemed to have obtained control of the Company if he
        and others acting in concert with him have together obtained control
        of it.
	 	 

	 (3)	 Subject to sub-rules (5) and (7) below,
        if any person becomes bound or entitled to acquire Shares in the Company
        under sections 428 to 430F of the Companies Act 1985, or if the Company
        passes a resolution for voluntary winding up, or if an order is made
        for the compulsory winding up of the Company, then:
	 	 

	  	 (a)	 in respect of an Option, the Committee
        shall forthwith notify every Participant thereof and, subject to earlier
        lapse under Rule 5(4), any Option may be exercised within one month of
        such notification, but to the extent that it is not exercised within
        that period shall (notwithstanding any other provision of this Plan)
        lapse on the expiration of that period; and
	 	 	 

	  	 (b)	 in respect of a Share Right, the Committee
        shall procure the transfer to a Participant of the Shares subject to
        a Share Right as soon as reasonably practicable even if no obligation
        to procure a transfer under Rule 6(1) above has arisen (but not if the
        Share Right has lapsed pursuant to Rule 6(3) above, or the relevant Shares
        have already been transferred to the Participant).
	 	 	 

	 (4)	 Subject to sub-rules (5) and (7) below,
        if a scheme of arrangement or compromise under section 425 of the Companies
        Act 1985 is proposed then:
	 	 

	  	 (a)	 in respect of an Option, the Committee
        shall forthwith notify every Participant that, subject to earlier lapse
        under Rule 5(4) above, an Option may be conditionally exercised within
        the period commencing from the date of notification and ending on the
        day immediately preceding the date scheduled for the Court hearing or
        such later date up to a maximum of six months from the Court hearing
        as the Committee may determine. If the Court sanctions the scheme of
        arrangement or compromise:
	 	 	 

	  	  	 (i)	 any Option so conditionally exercised
        shall immediately become unconditionally exercised by the Participant;
        and
	 	 	 	 

	  	  	 (ii)	 any Option not so conditionally exercised
        shall lapse on the expiration of that period.

	

    
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	 	 	However, if the Court declines
        to sanction the scheme of arrangement or compromise, the conditional
        exercise shall not be effective and the Option shall continue to subsist.
	 	 	 

		 (b)	 in respect of a Share Right, if the
        scheme of arrangement or compromise is sanctioned by the Court, then
        the Committee shall procure the transfer to a Participant of the Shares
        subject to a Share Right as soon as reasonably practicable even if no
        obligation to procure a transfer under Rule 6(1) above has arisen (but
        not if the Share Right has lapsed pursuant to Rule 6(3) above, or the
        relevant Shares have already been transferred to the Participant).
		 	 

	 (5)	 In relation to an Award which would
        be exercisable or vest by virtue of an event mentioned in sub-rules (1),
        (3) or (4) above, the number of Shares (if any) in respect of which the
        Award will be exercisable or vest will be calculated on the following
        basis:
	 	 

	  	 (a)	 by determining the extent to which
        the Performance Condition has been satisfied on the date on which such
        event occurs (as if that date were the end of the relevant performance
        period) in respect of the Award; and
	 	 	 

	  	 (b)	 by applying a pro rata reduction of
        the number of Shares determined under paragraph (a) above on the basis
        of the time which the Award has been subsisting bears to three years
	 	 	 

	 	unless the Committee decides
        that this sub-rule (5) operates unfairly in the circumstances in which
        case it may, in its discretion, determine that the Award should be treated
        in such other manner as it so decides.
	 	 

	 (6)	 If a demerger, special dividend or
        other event which, in the opinion of the Committee would affect the Share
        price to a material extent, is proposed then the Committee acting fairly
        and reasonably may at its discretion forthwith notify every Participant
        that, subject to earlier lapse under Rules 5 or 6 or the other provisions
        of this Rule 7, an Award may, subject to sub-rule (5) above be exercised
        (or Shares transferred to a Participant as appropriate) provided that
        if an Award is exercised in advance of and conditional upon such event
        and such event shall not occur then the conditional exercise shall not
        be effective and the Award shall continue to subsist.
	 	 

	 (7)	 If:
	 	 

	  	 (a)	 the events referred to in this Rule
        7 are part of an arrangement which will mean that the company will be
        under the control of another company (within the meaning of Section 840
        of the Taxes Act 1988) or the business of the Company is carried on by
        another company, and either the persons who owned the Shares in the Company
        immediately before the change of control will immediately afterwards
        own more than 50 per cent. of the Shares in that other company or the
        Committee in its discretion determines that such arrangement constitutes
        a merger (a “Reorganisation”); and
	 	 	 

	  	 (b)	 an equivalent Award (as determined
        by the Committee) is offered to the Participant in consideration of the
        surrender of his existing Award under this Plan

	 	 
	 	then an Award shall not
        become exercisable (or no Shares shall be transferred to a Participant
        in respect of a Share Right) as a result of the Reorganisation and, subject
        to earlier lapse under Rule 5(4), or 6(3), shall lapse three months following
        the notification of the Reorganisation to every Participant.

	

    
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	 (8)	 Unless the Committee determines otherwise,
        any equivalent Award offered to a Participant in the circumstances referred
        to in sub-rule (7) above shall be subject to the Performance Condition
        which applied to the original Award as varied by the Committee pursuant
        to sub-rule 3(3).
	 	 

	 8.	 Variation of Capital
	 	 

	 (1)	 Subject to sub-rule (3) below, in the
        event of any variation of the share capital of the Company, an increase
        in its share capital, the payment of a capital dividend, a demerger or
        similar event involving the Company, the Committee may make (or procure
        that the Trustees make) such adjustments as it considers appropriate
        under sub-rule (2) below.
	 	 

	 (2)	 An adjustment made under this sub-rule
        shall be to one or more of the following:
	 	 

	  	 (a)	 the number of Shares in respect of
        which any Option may be exercised;
	 	 	 

	  	 (b)	 where any Option has been exercised
        but no Shares have been transferred pursuant to the exercise, the number
        of Shares which may be so transferred; and
	 	 	 

	  	 (c)	 the number of shares in respect of
        which a Share Right subsists.
	 	 	 

	 (3)	 An adjustment of Shares pursuant to
        sub-rule (2) above can be effected through the grant of further Awards.
	 	 

	 9.	 Dividends
	 	 

	 (1)	 No Award shall confer any beneficial
        interest in any Share subject to it prior to the Participant (or his
        personal representatives, as appropriate) or his (or their) nominee being
        registered as the holder of the Share and, for the avoidance of doubt,
        no Participant (nor his personal representatives) shall be entitled to
        any dividends paid or any other distribution made, or to exercise or
        direct the exercise of any votes or any other rights, in respect of any
        such Share by reference to a record date before he (or they) or his (or
        their) nominee is registered as the holder of the Shares.
	 	 

	 (2)	 Notwithstanding sub-rule (1) above,
        the Committee may, in its discretion, procure that the payment to a Participant
        of a sum equivalent to dividends (net of all deductions required by law
        and any applicable commissions or other charges) on all or part of those
        Shares subject to an Award which can be treated as having vested following
        the satisfaction of any Performance Condition applicable to that Award.
	 	 

	 (3)	 Any amount referred to in sub-rule
        (2) above may, at the discretion of the Committee, be paid either
	 	 

	  	 (a)	 between the third and fourth anniversaries
        of the Grant Date; or
	 	 	 

	  	 (b)	 as soon as reasonably practicable following
        the exercise of an Option or a transfer of Shares subject to a Share
        Right to a Participant.
	 	 	 

	 (4)	 Any amount referred to in sub-rule
        (2) above may, at the discretion of the Committee, be paid either in
        cash or in the form of Shares in the Company.
	 	 

	 10.	 Alterations
	 	 

	 (1)	 Subject to sub-rules (2) and (4) below,
        the Committee may at any time alter this Plan.

	

    
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	 (2)	 Subject to sub-rule (3) below, no alteration
        to the advantage of the persons to whom Awards have been or may be granted
        shall be made to any of Rules 2, 3(1), 3(2), 3(3), 3(5), 3(6) and 3(7),
        4, 5(1), 5(2), 5(3), 5(4), 5(5), 5(6), 5(8), 5(9), 5(10), 5(11), 6(1),
        6(2), 6(3), 6(4), 6(5), 6(7), 6(8), 6(9), 6(10), 6(11), 7, 8 and 9 without
        the prior approval by ordinary resolution of the members of the Company
        in general meeting.
	 	 

	 (3)	 Sub-rule (2) above shall not apply
        to any minor alteration to benefit the administration of this Plan, to
        take account of a change in legislation or to obtain or maintain favourable
        tax, exchange control or regulatory treatment for Participants or any
        Group Member.
	 	 

	 (4)	 No alteration to the disadvantage of
        any Participant shall be made under sub-rule (1) above unless:
	 	 

	  	 (a)	 the Committee shall have invited every
        relevant Participant to give an indication as to whether or not he approves
        the alteration; and
	 	 	 

	  	 (b)	 the alteration is approved by a majority
        of those Participants who have given such an indication.
	 	 	 

	 (5)	 As soon as reasonably practical after
        any amendment under sub-rule (1) above, the Committee shall give written
        notice thereof to the Trustee and any Participant who in its opinion
        is materially affected thereby.
	 	 

	 11.	 Cash Equivalent
	 	 

	 (1)	 Where an Option granted under this
        Plan has been exercised by any person in respect of any number of Shares,
        or where Shares subject to a Share Right could be transferred to a person
        pursuant to Rules 6 or 7 above, and those Shares have not yet been transferred
        to him, the Committee may determine that, in substitution for his right
        to acquire such number of those Shares as the Committee may decide (but
        in full and final satisfaction of his said right), he shall be paid by
        way of additional emoluments a sum equal to the cash equivalent of that
        number of Shares.
	 	 

	 (2)	 For the purposes of this Rule, the cash
          equivalent of any Shares is the amount by which the Committee’s
          opinion of the market value of those Shares on the day last
          preceding the date on which the Option was exercised, or the Shares
          subject to a Share Right would otherwise be transferred to a person
          pursuant to Rules 6 and 7 above, exceeds the amount (if any) payable
          by the Participant to acquire those Shares. If at the relevant time
          shares of the same class as those shares were listed in The Stock Exchange
          Daily Official List, market value should be the middle-market
          quotation of shares of that class, as derived from that List, on the
          dealing day last preceding that date. If the Shares are ADSs listed
          on the New York Stock Exchange the market value should be the
          closing price of ADSs on the New York Stock Exchange on the dealing
          day last preceding that date.
	 	 

	 (3)	 As soon as reasonably practicable after
        a determination has been made under sub-rule (1) above that a person
        shall be paid a sum in substitution for his right to acquire any number
        of Shares:
	 	 

	  	 (a)	 the Company shall pay to him or procure
        the payment to him of that sum in cash; and
	 	 	 

	  	 (b)	 if he has already paid the Company
        for those Shares, the Company shall return to him the amount so paid
        by him.

	

    
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	 (4)	 There shall be made from any payment
        under this Rule such deductions (on account of tax or similar liabilities)
        as may be required by law or as the Committee may reasonably consider
        to be necessary or desirable.
	 	 

	 12.	 Miscellaneous
	 	 

	 (1)	 The rights and obligations of any individual
        under the terms of his office or employment with any Group Member shall
        not be affected by his participation in this Plan or any right which
        he may have to participate in it, and an individual who participates
        in it and does not waive an Award within 30 days of its Grant Date shall
        and does by participating in the Plan waive any and all rights to compensation
        or damages in consequence of the termination of his office or employment
        for any reason whatsoever insofar as those rights arise or may arise
        from his ceasing to have rights under or be entitled to exercise or receive
        Shares under any Award as a result of such termination.
	 	 

	 (2)	 In the event of any dispute or disagreement
        as to the interpretation of this Plan, or as to any question or right
        arising from or related to this Plan, the decision of the Committee shall
        be final and binding upon all persons.
	 	 

	 (3)	 Any notice or other communication under
        or in connection with this Plan may be given either:
	 	 

	  	 (a)	 by personal delivery or by sending
        it by post, in the case of a company to its registered office, and in
        the case of an individual to his last known address, or, where he is
        a director or employee of a Group Member, either to his last known address
        or to the address of the place of business at which he performs the whole
        or substantially the whole of the duties of his office or employment
        or in the absence of their being such a place, the place of business
        to which regular correspondence in connection with his employment is
        sent; and where a notice or other communication is given by first class
        post it shall be deemed to have been received 48 hours after it was put
        into the post properly addressed and stamped; or
	 	 	 

	  	 (b) 	   in an electronic communication to an
        address for the time being notified for that purpose to the person giving
    the notice.
	 	 	 

	 (4)	 A Participating Company may provide
        money to the Trustees or to any other person to enable that person to
        acquire Shares to be held for the purposes of the Plan, or enter into
        any guarantee or indemnity for these purposes, or meet the expenses of
        the Trustees to the extent permitted by the Companies Act 1985.
	 	 

	 (5)	 The Plan and all Awards granted under
        it shall be governed by the laws of England and any dispute arising under
        or in respect of this Plan or any such Award shall be subject to the
        exclusive jurisdiction of the Courts of England.

	

    
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Table
      of Contents

	Contents	Page
	 	 	 
	1.	Definitions
          and Interpretation	1
	 	 	 
	2. 	Eligibility	2
	 	 	 
	3.	Grant
          of Awards	2
	 	 	 
	4.	Limits	3
	 	 	 
	5.	Exercise
          of Options	4
	 	 	 
	6.	Vesting
          of Share Rights	6
	 	 	 
	7.	Takeover,
          Reconstruction and Winding-up	9
	 	 	 
	8.	Variation
          of Capital	11
	 	 	 
	9.	Dividends	11
	 	 	 
	10.	Alterations	11
	 	 	 
	11.	Cash
          Equivalent	12
	 	 	 
	12.	Miscellaneous	13

	

    
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