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EXHIBIT 10.5.1    
    

[Indemnitee Name]

 
 

INDEMNIFICATION AGREEMENT    
    

        This Indemnification Agreement ("Agreement") is made as of this    day of            , 200  , by
and between DPAC Technologies Corp.,
a California corporation (the "Company"), and                        , an individual ("Indemnitee"). 

        WHEREAS,
the Company desires to attract and retain the services of highly qualified individuals, such as Indemnitee, to serve as officers and directors of the Company and to indemnify
its officers and directors so as to provide them with the maximum protection permitted by law; 

        WHEREAS,
the Company and Indemnitee further recognize the substantial increase in corporate litigation in general, subjecting officers and directors to expensive litigation risks at the
same time that the availability and coverage of liability insurance has been severely limited; and 

        WHEREAS,
Indemnitee does not regard the current protection available as adequate under the present circumstances, and Indemnitee and other officers and directors of the Company may not
be willing to continue to serve as officers and directors without additional protection. 

        NOW,
THEREFORE, for good and valuable considerations, receipt and sufficiency of which is hereby acknowledged, the Company and Indemnitee hereby agree as follows: 

        1.    Indemnification.    

        (a)    Third Party Proceedings.    The Company shall indemnify and hold harmless Indemnitee in the event that
Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, or any
inquiry or investigation that Indemnitee in good faith believes might lead to the institution of any such action, suit or proceeding, whether civil, criminal, administrative or investigative (other
than an action by or in the right of the Company or any subsidiary of the Company to procure a judgment in its favor) by reason of the fact that Indemnitee is or was or was acting in a capacity as a
director, officer, employee or agent of the Company, or any subsidiary of the Company, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust or other enterprise, to the fullest extent permitted by the California General Corporation Law, as the same exists or may
hereafter be amended (but, in the case of any such amendment with reference to events occurring prior to the effective date thereof, only to the extent that such amendment permits the Company to
provide broader indemnification rights than such law permitted the Company to provide prior to such amendment) against all expenses, liabilities and losses (including attorneys' fees and costs,
judgments, fines and amounts paid or to be paid in any settlement if such settlement is approved in advance by the Company, which approval shall not be unreasonably withheld) actually and reasonably
incurred by Indemnitee in connection with such action, suit or proceeding if Indemnitee acted in good faith and in a manner Indemnitee reasonably believed to be in the best interests of the Company,
and, with respect to any criminal action or proceeding, had no reasonable cause to believe Indemnitee's conduct was unlawful. The termination of any action, suit or proceeding by judgment, order,
settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee
reasonably believed to be in the best interests of the Company, or, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. 

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        (b)    Proceedings by or in the Right of the Company.    The Company shall indemnify and hold harmless Indemnitee in
the event that Indemnitee is or was a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding by or in the right of the Company or any subsidiary
of the Company to procure a judgment in its favor by reason of the fact that Indemnitee is or was or was acting in a capacity as a director, officer, employee or agent of the Company, or any
subsidiary of the Company, or by reason of the fact that Indemnitee is or was serving at the request of the Company as a director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, to the fullest extent permitted by the California General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment
with reference to events occurring prior to the effective date thereof, only to the extent that such amendment permits the Company to provide broader indemnification rights than such law permitted the
Company to provide prior to such amendment) against all expenses, liabilities and losses (including attorneys' fees and costs, judgments, fines and amounts paid or to be paid in any settlement), in
each case to the extent actually and reasonably incurred by Indemnitee in connection with the defense or settlement of such action or suit if Indemnitee acted in good faith and in a manner that
Indemnitee reasonably believed to be in the best interests of the Company and its shareholders, except that no indemnification shall be made pursuant to this Section 2(b) for the following:
(1) in respect of any claim,
issue or matter as to which Indemnitee shall have been adjudged to be liable to the Company in the performance of Indemnitee's duty to the Company and its shareholders, unless and only to the extent
that the court in which the proceeding is or was pending shall determine upon application that, in view of all the circumstances of the case, Indemnitee is fairly and reasonably entitled to indemnity
for expenses and then only to the extent that the court shall determine; (2) of amounts paid in settling or otherwise disposing of a pending action without court approval; (3) of
expenses incurred in defending a pending action which is settled or otherwise disposed of without court approval; or (4) in respect of an action brought by or in the right of the Company for
breach of Indemnitee's duties to the Company and its shareholders, of liability of Indemnitee (i) for acts or omissions that involve intentional misconduct or a knowing and culpable violation
of law, (ii) for acts or omissions that Indemnitee believes to be contrary to the best interests of the Company or its shareholders or that involve the absence of good faith on the part of
Indemnitee, (iii) for any transaction from which Indemnitee derived an improper personal benefit, (iv) for acts or omissions that show a reckless disregard for Indemnitee's duty to the
Company or its shareholders in circumstances in which Indemnitee was aware, or should have been aware, in the ordinary course of performing Indemnitee's duties, of a risk of serious injury to the
Company or its shareholders, (v) for acts or omissions that constitute an unexcused pattern of inattention that amounts to an abdication of the Indemnitee's duty to the Company or its
shareholders, (vi) under Section 310 of the California General Corporation Law, (vii) under Section 316 of the California General Corporation Law.    In making
the determination whether indemnification would not be permitted under applicable law, the termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon plea of
nolo contendre or its equivalent, shall not, of itself, create a presumption that Indemnitee did not act in good faith and in a manner which Indemnitee reasonably believed to be in the best interests
of the Company, or, with respect to any criminal action or proceeding, had reasonable cause to believe that Indemnitee's conduct was unlawful. 

        (c)    Mandatory Payment of Expense.    To the extent that Indemnitee has been successful on the merits or otherwise
in defense of any action, suit or proceeding referred to in Subsections (a) and (b) of this Section or the defense of any claim, issue or matter therein, Indemnitee shall be indemnified
against expenses (including attorneys' fees) actually and reasonably incurred by Indemnitee in connection therewith. 

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        2.    Expenses; Indemnification Procedure.    

        (a)    Payment of Expenses.    The Company shall promptly reimburse or pay as and when incurred all expenses incurred
by Indemnitee in connection with the investigation, defense, settlement or appeal of any civil or criminal action, suit or proceeding referenced in Section 2(a) or (b) hereof (but not
amounts actually paid in settlement of any such action, suit or proceeding); provided, however, that the Company shall not be required to make any such payment to or for the Indemnitee to the extent
expressly prohibited by law as determined by controlling legal precedent and the Reviewing Party. Indemnitee hereby undertakes to repay such amounts advanced only if, and to the extent that, it shall
ultimately be determined that Indemnitee is not entitled to be indemnified by the Company as authorized hereby; provided, however, that the Company shall not be required to make any such advance to
the extent prohibited by law. The advances to be made hereunder shall be paid by the
Company to Indemnitee within ten (10) days following delivery of a written request therefor by Indemnitee to the Company accompanied by reasonable documentation of such expenses being incurred
in such connection. 

        (b)    Notice/Cooperation by Indemnitee.    Indemnitee shall, as a condition precedent to his right to be indemnified
under this Agreement, give the Company notice in writing as soon as practicable of any claim made against Indemnitee for which indemnification will or could be sought under this Agreement; however,
failure to provide such notice shall not be construed as a waiver of any right of Indemnitee to an advance or indemnification hereunder. In addition, Indemnitee shall give the Company such information
and cooperation as it may reasonably request and as shall be within Indemnitee's power. 

        (c)    Procedure for Indemnification.    After the final disposition of any action, suit or proceeding covered by this
Agreement, Indemnitee shall send to the Company a written request for any indemnification sought under this Agreement. No later than thirty (30) days following receipt by the Company of such
request, the Company shall deliver such request to an appropriate Reviewing Party for its review pursuant to this Agreement and shall cause the indemnification provided hereunder to be authorized and
paid, so long as during such 30-day period the Reviewing Party has not determined that indemnification would not be permitted under applicable law; provided that if either the Board of
Directors of the Company or the shareholders of the Company determine that indemnification would be permitted under applicable law, then the Company shall cause the indemnification provided hereunder
to be authorized and paid regardless of the determination of the Reviewing Party. The Indemnitee and Indemnitee's counsel shall be given an opportunity to be heard and to present evidence on his
behalf in connection with such determination by the Reviewing Party. 

        (d)    Right of Indemnitee to Bring Suit.    The rights of Indemnitee to bring suit against the Company under this
Agreement include the following: 

        (i)    If
a claim under this Agreement, under any statute, or under any provision of the Company's Articles of Incorporation or Bylaws providing for indemnification, is not
paid in full by the Company within forty-five (45) days after a written request for payment thereof has first been received by the Company, Indemnitee may, but need not, at any time
thereafter bring an action against the Company to recover the unpaid amount of the claim and, subject to Section 16 of this Agreement, Indemnitee shall also be entitled to be paid for the
expenses (including attorneys' fees) of bringing such action. 

        (ii)   If
there has been no determination by the Reviewing Party or if the Reviewing Party determines that Indemnitee substantively would not be permitted to be indemnified in
whole or in part under applicable law, Indemnitee shall have the right to bring suit seeking a new determination by the court based on a complete presentation of facts or challenging any such
determination by the Reviewing Party or any aspect thereof. 

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        It
shall be a defense to any action described in paragraphs (i) and (ii) above (other than an action brought to enforce a claim for expenses incurred in connection with any
action, suit or proceeding in advance of its final disposition) that Indemnitee has not met the standards of conduct which make it permissible under applicable law for the Company to indemnify
Indemnitee for the amount claimed, but the burden of proving such defense shall be on the Company and Indemnitee shall be entitled to receive interim payments of expenses pursuant to
Section 2(a) unless and until such defense may be finally adjudicated by court order or judgment from which no further right of appeal exists. It is the parties' intention that if the Company
contests Indemnitee's right to indemnification, the question of Indemnitee's right to indemnification shall be for the court to decide, and neither the failure of the Company (including its Board of
Directors, any committee or subgroup of the Board of Directors, independent legal counsel, its shareholders or other Reviewing Party) to have made a determination that indemnification of Indemnitee is
proper in the circumstances because Indemnitee has met the applicable standard of conduct required by applicable law, nor an actual determination by the Company (including its Board of Directors, any
committee or subgroup of the Board of Directors, independent legal counsel, its shareholders or other Reviewing Party) that Indemnitee has not met such applicable standard of conduct, shall create a
presumption that Indemnitee has or has not met the applicable standard of conduct or, in the case of such an action brought by Indemnitee, be a defense to such action. 

        (e)    Notice to Insurers.    If, at the time of the receipt of a notice of a claim pursuant to Section 2(b)
hereof, the Company has director and officer liability insurance in effect, the Company shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedure
set forth in the respective policies. The Company shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Indemnitee, all amounts payable as a result of
such proceeding in accordance with the terms of such policies. 

        (f)    Selection of Counsel.    In the event the Company shall be obligated under Section 2(a) hereof to pay
the expenses of any proceedings against Indemnitee, the Company, if appropriate, shall be entitled to assume the defense of such proceeding, with counsel approved by Indemnitee, upon the delivery to
Indemnitee of written notice of its election to do so. After delivery of such notice, approval of such counsel by Indemnitee and the retention of such counsel by the Company, the Company will not be
liable to Indemnitee under this Agreement for any fees of separate counsel subsequently incurred by Indemnitee with respect to the same proceeding for so long as the Company continues to employ and
pay such counsel, provided that Indemnitee shall have the right to employ his counsel in any such proceeding at Indemnitee's expense. If the employment of counsel by Indemnitee has been previously
authorized by the Company, and Indemnitee shall have reasonably concluded that there may be a material conflict of interests between the Company and Indemnitee in the conduct of such defense,
then the fees and expenses of Indemnitee's separate and independent counsel shall be at the expense of the Company. 

        3.    Additional Indemnification Rights; Nonexclusivity.    

        (a)    Scope.    Notwithstanding any other provision of this Agreement, the Company hereby agrees to indemnify
Indemnitee to the fullest extent permitted by law notwithstanding that such indemnification is not specifically authorized by the other provisions of this Agreement, the Company's Articles of
Incorporation, the Company's Bylaws or by statute. In the event of any change in any applicable law, statute or rule which narrows the right of a California corporation to indemnify a member of its
Board of Directors or an officer, such change, to the extent not otherwise required by such law, statute or rule to be applied to this Agreement, shall have no effect on this Agreement or the parties'
rights and obligations hereunder. 

        (b)    Nonexclusivity.    The indemnification provided by this Agreement shall not be deemed exclusive of any rights
to which Indemnitee may be entitled under the Company's Articles of Incorporation, its Bylaws, any agreement, any vote of shareholders or disinterested Directors, the 

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General
Corporation Law of the State of California or California Labor Code Section 2802(a), or otherwise, both as to action in Indemnitee's official capacity and as to action in any other
capacity while holding such office. The indemnification provided under this Agreement shall continue as to Indemnitee for any action taken or not taken while serving in an indemnified capacity even
though he may have ceased to serve in such capacity at the time of any action, suit or other covered proceeding, and shall inure to the benefit of the estate, heirs, executors and administrators of
Indemnitee. 

        4.    Partial Indemnification.    If Indemnitee is entitled under any provision of this Agreement to indemnification
by the Company for some or a portion of the expense, judgments, fines or penalties actually or reasonably incurred by him in the investigation, defense, appeal or settlement of any civil or criminal
action, suit or proceeding, but not, however, for the total amount thereof, the Company shall nevertheless indemnify Indemnitee for the portion of such expenses, judgments, fines or penalties to which
Indemnitee is entitled. 

        5.    Mutual Acknowledgment.    Both the Company and Indemnitee acknowledge that in certain instances, Federal law or
applicable public policy may authorize a governmental authority to prohibit the Company from indemnifying its directors and officers under this Agreement or otherwise. For instance, Indemnitee
understands and acknowledges that the Company has undertaken or may be required in the future to undertake with the Securities and Exchange Commission to submit the question of indemnification to a
court in certain circumstances for a determination of the Company's right under public policy to indemnify Indemnitee. 

        6.    Officer and Director Liability Insurance.    The Company shall, from time to time, make the good faith
determination whether or not it is practicable for the Company to obtain and maintain a policy or policies of insurance with reputable insurance companies providing the Indemnitee with coverage for
losses from wrongful acts, or to ensure the Company's performance of its indemnification obligations under this Agreement, whether or not it is practicable to obtain such insurance for other officers
and directors of the Company. Among other considerations, the Company will weigh the costs of obtaining such insurance coverage against the protection afforded by such coverage. Notwithstanding the
foregoing, the Company shall have no obligation to obtain or maintain such insurance if the Company determines in good faith that such insurance is not reasonably available, if the premium costs for
such insurance are disproportionate to the amount of coverage provided, if the coverage provided by such insurance is limited by exclusions so as to provide an insufficient benefit, or if Indemnitee
is covered by similar insurance maintained by a subsidiary or parent of the Company, provided that the Company make some other provision to help ensure the Company's performance of its indemnification
obligations, such as the creation and funding of a trust for a ready source of indemnification payments for Indemnitee and all other indemnitees under similar agreements. 

        7.    Severability.    Nothing in this Agreement is intended to require or shall be construed as requiring the Company
to do or fail to do any act in violation of applicable law. The Company's inability, pursuant to court order, to perform its obligations under this Agreement shall not constitute a breach of this
Agreement. The provisions of this Agreement shall be severable as provided in this Section. If this Agreement or any portion hereof shall be invalidated on any ground by any court of competent
jurisdiction, then the Company shall nevertheless indemnify Indemnitee to the full extent permitted by any applicable portion of this Agreement that shall not have been invalidated, and the balance of
this Agreement not so invalidated shall be enforceable in accordance with its terms. 

        8.    Exceptions.    Any other provision herein to the contrary notwithstanding, the Company shall not be obligated
pursuant to the terms of this Agreement: 

        (a)    Claims Initiated by Indemnitee.    To indemnify or advance expenses to Indemnitee with respect to proceedings
or claims initiated or brought voluntarily by Indemnitee and not by way of defense, except with respect to proceedings brought to establish or enforce a right to 

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indemnification
under this Agreement or any other statute or law or otherwise as required under Section 317 of the California General Corporation Law, but such indemnification or advancement of
expenses may be provided by the Company in specific cases if the Board of Directors has approved the initiation or bringing of such suit; or 

        (b)    Lack of Good Faith.    To indemnify Indemnitee for any expenses incurred by Indemnitee with respect to any
proceeding instituted by Indemnitee to enforce or interpret this Agreement, if a court of competent jurisdiction determines that each of the material assertions made by Indemnitee in such proceeding
was not made in good faith (e.g., was "frivolous"); or 

        (c)    No Duplication of Payments.    To indemnify Indemnitee for expenses or liabilities of any type whatsoever
(including, but not limited to, judgments, fines, ERISA excise taxes or penalties, and amounts paid in settlement) to the extent Indemnitee has otherwise actually received payment (under any insurance
policy or otherwise) of the amounts otherwise indemnifiable hereunder; or 

        (d)    Claims Under Section 16(b).    To indemnify Indemnitee for expenses and the payment of profits arising
from the purchase and sale by Indemnitee of securities in violation of Section 16(b) of the Securities Exchange Act of 1934, as amended, or any similar successor statute. 

        9.    Subrogation.    In the event of payment under this Agreement, the Company shall be subrogated to the extent of
such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and shall do everything that may be necessary to secure such rights, including the execution of such
documents necessary to enable the Company effectively to bring suit to enforce such rights. 

        10.    Construction of Certain Phrases.    

        (a)   For
purposes of this Agreement, references to the "Company" shall include, in addition to the resulting corporation, any constituent corporation (including any
constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and
employees or agents, so that if Indemnitee is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a
director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, Indemnitee shall stand in the same position under the provisions of this Agreement
with respect to the resulting or surviving corporation as Indemnitee would have with respect to such constituent corporation if its separate existence had continued. 

        (b)   For
purposes of this Agreement, references to "other enterprises" shall include employee benefit plans; references to "fines" shall include any excise taxes assessed on
Indemnitee with respect to an employee benefit plan; and references to "serving at the request of the Company" shall include any service as a director, officer, employee or agent of the Company which
imposes duties on, or involves services by, such director, officer, employee or agent with respect to an employee benefit plan, its participants, or beneficiaries; and if Indemnitee acted in good
faith and in a manner Indemnitee reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan, Indemnitee shall be deemed to have acted in a manner "not
opposed to the best interests of the Company" as referred to in this Agreement. 

        11.    Counterparts.    This Agreement may be executed in one or more counterparts, each of which shall constitute an
original. 

        12.    Survival.    The Company acknowledges that in continuing to provide services to the Company, Indemnitee is
relying on this Agreement. Accordingly, the Company agrees that its obligations hereunder will survive (A) any actual or purported termination of this Agreement by the Company or its successors
or assigns whether by operation of law or otherwise, and (B) termination of Indemnitee's services to the Company, whether such services were terminated by the Company or Indemnitee, with 

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respect
to any Claim, whether or not such Claim is made, threatened or commenced before or after the actual purported termination of this Agreement or the termination of Indemnitee's services to the
Company. Nothing contained in this Agreement is intended to create in Indemnitee any right to continued employment. 

        13.    Successors and Assigns.    This Agreement shall be binding upon and inure to the benefit of and be enforceable
by the parties hereto and their respective successors, assigns, including any direct or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business
and/or assets of the Company, spouses, heirs, and personal and legal representatives. The Company shall require and cause any successor (whether direct or indirect by purchase, merger, consolidation
or otherwise) to all or substantially all of the business and/or assets of the Company, by written agreement in form and substance reasonably satisfactory to Indemnitee, expressly to assume and agree
to perform this Agreement in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place. 

        14.    Attorneys' Fees.    In the event that any action is instituted by Indemnitee under this Agreement to enforce or
interpret any of the terms hereof, Indemnitee shall be entitled to be paid all court costs and expenses, including reasonable attorneys' fees and costs, incurred by Indemnitee with respect to such
action, unless as a part of such action, the court of competent jurisdiction determines that each of the material assertions made by Indemnitee as a basis for such action were not made in good faith
or were frivolous. In the event of an action instituted by or in the name of the Company under this Agreement, or to enforce or interpret any of the terms of this Agreement, Indemnitee shall be
entitled to be paid all court costs and expenses, including attorneys' fees and costs, incurred by Indemnitee in defense of such action (including with respect to Indemnitee's counterclaims and
cross-claims made in such action), unless as a part of such action the court determines that each of Indemnitee's material defenses to such action were made in bad faith or were frivolous. 

        15.    Notice.    All notices, requests, demands and other communications under this Agreement shall be in writing and
shall be deemed duly given (i) if transmitted via facsimile, (ii) if delivered by hand and receipted for by the party addressed, on the date of such receipt, or (iii) if mailed by
domestic certified or registered mail with postage prepaid, on the third business day after the date postmarked. Addresses for notice to either party are as shown on the signature page of this
Agreement, as subsequently modified by any written notice given from time to time to the other party in the manner described above. 

        16.    Choice of Law.    This Agreement shall be governed in all respects, including validity, interpretation and
effect, by the laws of the State of California (without giving effect to the provisions thereof relating to conflicts of law). 

        17.    Amendments.    This Agreement may not be amended without the agreement in writing of the Company and
Indemnitee. 

        IN
WITNESS WHEREOF, the parties hereto have executed this Indemnification Agreement as of the date first above written. 

DPAC
TECHNOLOGIES CORP. 

	 
	 
	 	 

	By:	    
	 	 
	Name:	    
	 	 
	Title:	    
	 	 

Address:    7321
Lincoln Way

Garden Grove, California 92641

FAX:    714-899-7579 

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AGREED
TO AND ACCEPTED: 

INDEMNITEE:

	 
	 	 
	 	 

	
 (Signature)	 	 	 	 

Name: [Indemnitee Name]  

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EXHIBIT 10.5.1

INDEMNIFICATION AGREEMENTUse these links to rapidly review the document

  Exhibit 4.5

  

 

Exhibit 4.5    
    

 

8 July 2004    
    

          National Grid Transco plc  

 and  

 National Grid USA  

 and  

 Michael E. Jesanis  

 Service Agreement  

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Index  

        
 

	Index	 	1
	

1	
 	

Interpretation
	

2	
 	

Commencement of Employment
	

3	
 	

Appointment and Duties of the Executive
	

4	
 	

Hours
	

5	
 	

Interests of the Executive and Code
	

6	
 	

Location
	

7	
 	

Salary and Benefits
	

8	
 	

Expenses
	

9	
 	

Confidentiality
	

10	
 	

Intellectual Property Rights
	

11	
 	

Termination and Suspension
	

12	
 	

Garden Leave
	

13	
 	

Protection of interests of the Group
	

14	
 	

Offers on Liquidation
	

15	
 	

Return of Company Property
	

16	
 	

Directorships
	

17	
 	

Notices
	

18	
 	

Data Protection Act 1998
	

19	
 	

Third Party Claims
	

20	
 	

Miscellaneous

2

  

        This Agreement is made
on                        between

	(1)
	NATIONAL GRID TRANSCO PLC whose registered office is at 1-3 Strand, London,
WC2N 3EH (the "UK Company");

	(2)
	NATIONAL GRID USA, a Delaware business corporation whose office is at 25 Research
Drive, Westborough, MA 01582 (the "US Company"); and

	(3)
	MICHAEL E. JESANIS of Hopkinton, MA (the
"Executive"). 

        This
agreement records the terms on which the Executive will be employed by the US Company and the terms pursuant to which the Executive will provide his services as an Executive
Director to the UK Company. 

 
 

1      Interpretation  

        In this agreement (and any schedules to it): 

	1.1
	Definitions

        "UK Board" means the board of directors of the UK Company from time to time or any person or committee nominated by the board of directors
as its representative for the purposes of this agreement; 

        "US Board" means the board of directors of the US Company from time to time or any person or committee nominated by the board of directors
as its representative for the purposes of this agreement; 

        "Employment" means the employment governed by this agreement; 

        "Good Reason" means termination by the Executive for Good Reason. The Executive may
terminate his employment with the US Company for Good Reason and receive the compensation and benefits described in clause 11.3. For purposes of this Agreement "Good Reason" shall mean the
occurrence (without the Executive's express written consent) of any of the following acts by the US Company, or failure by the US Company to act, unless such act or failure to act is corrected by the
US Company within thirty (30) days of receipt of the Executive's notice of termination. 

        (I)   a
reduction in the Executive's annual base salary or any breach by the US or UK Company of their respective obligations under clauses 7.3, 7.4, 7.5, or 16.4; 

        (II)  a
failure of the US Company to continue the Executive in the position of President and Chief Executive Officer; 

        (III)   a
material and substantial diminution in the nature or scope of the Executive's responsibilities, duties or authority; 

        (IV)   the
US Company requiring the Executive's principal place of employment to be anywhere other than at the US Company's headquarters or other Group Company's
headquarters with the US, wherever such headquarters may be located from time to time, unless agreed to by both parties, in which case said location may be outside the United States; 

        (V)  any
purported termination of the Executive's employment which is not effected pursuant to a notice of termination satisfying the requirements of clause 11 (for
purposes of this Agreement, no such purported termination shall be effective). 

        "Group" means the US Company, the UK Company and their respective associates (as defined in section 435 of the Insolvency Act 1986)
from time to time; 

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        "Group Company" means a member of the Group and "Group Companies" will be interpreted
accordingly; 

        "Holiday Year" means each 12-month period commencing on January 1 and ending on December 31; 

        "Termination Date" means the date on which the Employment terminates. 

 
 

2      Commencement of Employment  

        2.1   The Executive shall be employed by the US Company as President and CEO of the US Company and as an Executive Director of
the UK Company, as provided in this agreement. The Executive shall not be an employee of the UK Company, however the Executive's salary and other benefits may be provided by the UK Company on behalf
of the US Company. 

        2.2   The Employment as President will start on 26 July 2004 (the "Commencement
Date"). The Employment will continue until termination in accordance with the provisions of this agreement. For purposes of 'continuous service' previous employment with
National Grid USA or any of its predecessor companies will count as continuous. 

 
 

3      Appointment and Duties of the Executive  

        3.1   The Executive will serve as President and Chief Executive Officer of the US Company and as an Executive Director of the
UK Company. 

        3.2   In accordance with the UK Company's Articles of Association, the Executive's appointment as an Executive Director is
subject to ratification by shareholders in General Meeting. 

        3.3   The Executive will: 

        3.3.1    (unless prevented from doing so by sickness or injury) devote the whole of his working time, attention
and skill to the Employment; 

        3.3.2    properly perform his duties and exercise his powers; 

        3.3.3    accept any offices or directorships as reasonably required by the US Board or the UK Board; 

        3.3.4    to the extent applicable, comply with all rules and regulations issued by both the US Company and the UK
Company; 

        3.3.5    comply with the directions, lawfully and properly given to him by the US Board and the UK Board; 

        3.3.6    act in accordance with the Certificate of Incorporation and accompanying by-laws (or
equivalent constitutional documents) of both the US Company and of the UK Company, and of any other relevant Group Company; and 

        3.3.7    use his best endeavours to promote the interests and reputation of every Group Company. 

        For
the avoidance of doubt, it will not be considered a violation of clause 3.3.1 for the Executive to serve on corporate, industry, civic or charitable boards or committees, so
long as such activities do not
interfere with the performance of the Executive's responsibilities to the US Company and/or to the UK Company in accordance with this agreement. 

        3.4   The Executive accepts that: 

        3.4.1    the US Company and/or the UK Company may require him to perform duties for any other Group Company
whether for the whole or part of his working time. In performing those 

4

 

duties
clause 3.3.4 will apply as if references to the US Company/UK Company are to the appropriate Group Company. The US Company will remain responsible for the payments and benefits he is
entitled to receive under this agreement; and 

        3.4.2    subject to clause 11.7, the US Company may transfer the Employment to any other Group Company,
both within and outside the US; in the latter case, subject to the agreement of the Executive, not to be unreasonably withheld. 

        3.5   The Executive will keep the US Board and/or the UK Board as appropriate (and, where appropriate, the board of directors
of any other Group Company) fully informed of his conduct of the business, finances or affairs of the US Company and/or the UK Company or any other Group Company in a prompt and timely manner. He will
provide information to the relevant board in writing if requested. 

        3.6   The Executive will promptly disclose to the US Board and/or the UK Board as appropriate full details of any wrongdoing by
any employee of any Group Company where that wrongdoing is material to that employee's employment by the relevant company or to the interests or reputation of any Group Company. 

        3.7   At any time during the Employment the US Company or the UK Company may require the Executive to undergo a medical
examination by a medical practitioner appointed by that company. The Executive authorises that medical practitioner to disclose to the US Company or the UK Company (as appropriate) any report or test
results prepared or obtained as a result of that examination in so far as such report or test results contain medical information that is relevant to the performance of the Executive's duties.. 

 
 

4      Hours  

        4.1   The Executive will comply with the US Company's and the UK Company's normal hours of work (as appropriate) and will also
work any additional hours which may be reasonably necessary to perform his duties to the satisfaction of the relevant board. He will not receive any further remuneration for any hours worked in
addition to the normal working hours. 

 
 

5      Interests of the Executive and Code  

        5.1   The Executive will disclose promptly in writing to the US Board and/or to the UK Board (as appropriate) all his interests
and those of his spouse and dependent children (for example, shareholdings or directorships) whether or not of a commercial or business nature except his interests in any Group Company. 

        5.2   Subject to clause 5.3, during the Employment the Executive will not be directly or indirectly engaged or concerned
in the conduct of any business activity (except as a representative of the US Company or the UK Company, as provided for in this agreement, or otherwise with the written consent of the relevant
board). 

        5.3   The Executive may not hold or be interested in investments which amount to more than three per cent. of the issued
investments of any class of any one company whether or not those investments are listed or quoted on any recognised stock exchange. 

        5.4   The Executive will (and will procure that his spouse and dependent children) comply with all rules of law, including but
not limited to Rule 10b 5-1 of the Securities Exchange Act of 1934 and the applicable provisions of the New York Stock Exchange Listed Company Manual as well as other applicable
rules or company policies pertaining to the holding or trading of securities including compliance with the spirit as well as the letter of those rules. In relation to overseas dealings, he will 

5

 

also
comply with all laws of the country and all regulations of the stock exchange, market or dealing system in which such dealings take place. 

        5.5   The UK Company's Code of Corporate Governance provides that the Executive, in furtherance of his duties as a director of
the UK Company, may take independent professional advice, if necessary, at the UK Company's expense. This step should only be taken if it is in the best interests of the UK Company to do so and, in
any event, the Chairman or Group Company Secretary should be notified. 

        5.6   As a director of the UK Company, the Executive is bound by the provisions of company law and to the Stock Exchange
Listing requirements, details of which are available from the Group General Counsel and Group Company Secretary. The Executive should seek the advice of the Chairman on the interpretation of these
provisions in the event of any uncertainty. 

 
 

6      Location  

        6.1   The Executive will work at the headquarters of the US Company, although he will be required to travel to the UK from time
to time and may also be required to travel and work (subject to clause 3.4.2) elsewhere from time to time. 

 
 

7      Salary and Benefits  

        7.1   The US Company will pay the Executive a salary of $800,000 per annum. Salary will be paid in accordance with the US
Company's then prevailing payroll practices for salaried employees. Salary will be reviewed, for increases, annually commencing in 2005. The review will usually take place in April of each year. 

        7.2   The salary referred to in clause 7.1 includes director's fees from the Group Companies and any other companies in
which the Executive is required to accept a directorship under the terms of this Employment. To achieve this: 

        7.2.1    the Executive will repay any fees he receives to the US Company; 

        7.2.2    his salary will be reduced by the amount of those fees; or 

        7.2.3    a combination of the methods set out in clauses 7.2.1 and 7.2.2 may be applied. 

        7.3   The Executive shall be entitled to participate in the Group's Incentive Share Plans and Schemes on the same basis as
other Executive Directors of the UK Company and subject to the rules and conditions agreed by the Remuneration Committee for the relevant plan from time to time. 

        7.3.1    The Executive shall be entitled to participate in the National Grid USA's annual incentive arrangements
as a level 1 participant or in the Group annual incentive arrangement on the same basis as other Executive Directors of the UK Company, as determined by the Remuneration Committee. 

        7.4   The Executive is and will continue to be a participant in National Grid USA Companies' Executive Supplemental Retirement
Plan (the "ESRP"); and he will continue to be eligible for and may participate in other incentive, savings and retirement plans, programs and policies
of the US Company and its subsidiaries to the same extent as other senior officers of the US Company. Notwithstanding anything contained in the ESRP or clause 20.4 of this agreement to the
contrary, the parties agree that Section 6.01 of the ESRP (Vesting and Forfeiture of Benefits) is hereby amended with respect to the Executive to provide that the second paragraph thereof will
not apply to any ESRP benefits accrued prior to the Commencement Date of this agreement, and that with respect to ESRP benefits accrued on or after the Commencement Date the provisions of the second
paragraph of Section 6.01 will apply 

6

 

by
substituting the words "six (6) months" for the words "five years" where they appear in the second paragraph of Section 6.01 of the ESRP. 

        7.5   Without prejudice to the US Company's right to terminate the Employment at any time in accordance with clause 11,
if the Executive complies with the eligibility or other conditions set by the US Company or its insurers, the Executive and the .Executive's family, as the case may be, shall be eligible for and may
participate in all applicable welfare benefit plans, programs, and policies provided by the US Company and its subsidiaries, including, without limitation, medical, retiree medical, prescriptions,
dental, disability, sick leave, employee life insurance, group life insurance, accidental death and travel accident insurance plans and programs, to the same extent as other senior officers of the US
Company. 

        7.5.1    If the Executive is absent from work due to illness or injury, the amount of any benefit which the
Executive is entitled to claim during that period of absence under the Worker's Compensation Act, or any other law or regulation which the Executive is a non-contributory member by virtue
of the Employment will be deducted from any salary paid to him. The US Company reserves the right to offset the amount of these benefits against salary paid to the Executive even if the Executive has
not recovered them. 

        7.5.2    If the Executive is absent from work due to sickness or injury which is caused by the fault of another
person, and as a consequence recovers from that person or another person any sum representing compensation for loss of salary, the Executive will repay to the US Company any amount received by him
from any Group Company in respect of the same period of absence. 

        7.5.3    If the Executive is absent from work as a result of sickness or injury, he will: 

        (II)  notify
the US Company and/or the UK Company (as appropriate) by telephone on the first day of his absence, or in the event of being unable to do so, as soon as
practicable thereafter; and 

        (III) if
the period of absence is six (6) consecutive working days or longer for a non-work related illness or injury or one (1) working day for a
work-related illness or injury, provide to the relevant company, on his return, a medical certificate completed by his treating health care professional of sickness. 

        7.5.4    The US Company will continue to maintain the life insurance program established for the benefit of the
Executive in accordance with the provisions of the agreement entered into between New England Power Service Company and the Executive dated March 23, 1993 (the "Life Insurance Program"). 

        7.6   The US Company will reimburse the Executive in full for subscriptions for any professional memberships which, in the
opinion of the UK Company or US Company, are relevant to the Executive's role as an Executive Director or role as President and Chief Executive Officer of the US Company. 

        The
Executive is entitled to participate in the vacation policy of the US Company and receive fringe benefits and paid holidays on the same terms and conditions as other senior officers
of the US Company. 

        7.7   In the event that it is determined that any payment or benefit provided by any Group Company to or for the benefit of the
Executive, either under this agreement or otherwise, will be subject to the excise tax imposed by Section 4999 of the Internal Revenue Code or any similar or successor provision
("Secion 4999") the US Company will, prior to the date on which any amount of the excise tax must be paid or withheld, make an additional lump-sum payment (the "Gross-Up
Payment") to the Executive in an amount sufficient, after giving effect to all federal, state, and other taxes and charges (including interest and penalites, if any) with respect to the
Gross-Up Payment, to 

7

 

make
the Executive whole for all taxes (including withholding taxes) and any associated interest and penalties imposed under or as a result of Section 4999. This clause will only apply if the
current limits under Section 4999 are not increased. In the event that they change significantly in the future, the Company reserve the right to review this clause. 

 
 

8      Expenses  

        8.1   The US Company will refund to the Executive all reasonable expenses properly incurred by him in performing his duties as
an Executive Director of the UK Company and as President and CEO of the US Company, provided that these are incurred in accordance with UK or US Company policy, as applicable. The US Company (or the
UK Company on its behalf) will require the Executive to produce receipts or other documents as proof that he has incurred any expenses he claims. 

 
 

9      Confidentiality  

        9.1   Without prejudice to the common law duties which he owes to the US Company or the UK Company, the Executive agrees that
he will not, except in the proper performance of his duties, copy, use or except as required by law or legal process disclose to any person any of the US Company's or the UK Company's trade secrets or
confidential information ("confidential information"). This restriction will continue to apply after the termination of the Employment without limit in time but will not apply to confidential
information which 

        (i)    becomes
public other than through unauthorised disclosure by the Executive; 

        (ii)   is
lawfully and in good faith made available to the Executive outside the scope of his Employment by a third party who did not derive it from the US Company or the UK
Company and who imposes no obligation of confidence on the Executive; 

        (iii)    was
already known by the Executive at the time it was disclosed to him; or 

        (iv)  is
required to be disclosed by a government authority or by order of a court of competent jurisdiction. 

        The
Executive will use his best endeavours to prevent the unauthorised copying, use or disclosure of such information. 

        For
the purposes of this agreement confidential information includes but will not be limited to business plans, US Company, UK Company and Group Company forecasts, details of trading
levels, customer and other third party contracts, pricing structures and arrangements, and any other information in whatever form (written, oral, visual or electronic) concerning the confidential
affairs of the US Company and/or the UK Company. 

        9.2   In the course of the Employment the Executive is likely to obtain trade secrets and confidential information belonging or
relating to other Group Companies and other persons. He will treat such information as if it falls within the terms of clause 9.1 and clause 9.1 will apply with any necessary amendments
to such information. If requested to do so by either the US Company or the UK Company the Executive will enter into an agreement with other Group Companies and any other persons on the same terms as
clause 9.1 with any amendments necessary to give effect to this provision. 

 
 

10    Intellectual Property Rights  

        10.1 The Executive will promptly inform the US Company and the UK Company if he makes or is involved in making an Invention
during the Employment and will give the companies sufficient details of it to allow them to assess the Invention and to decide whether the Invention belongs to either company. The companies will treat
any Invention which does not belong to them (or either of them) as confidential. 

8

  

        "Invention" means any invention (whether patentable or not within the meaning of the US Patents Act as amended or other applicable
legislation in any other country) relating to the business of the US Company and/or the UK Company and/or made in the course of the Executive's employment. 

        10.2 If an Invention belongs to either or both of the US Company or the UK Company, the Executive will act as a trustee for
that company in relation to that Invention and will, at the request and expense of that company, do everything necessary to vest all right, title and interest in it in that company or its nominee with
full title guarantee and to secure full patent or other appropriate protection anywhere in the world. 

        10.3 If the Executive creates or is involved in creating any Work during the Employment (including during the provision of
his services as an Executive Director of the UK Company), the Executive will promptly give the US Company and the UK Company full details of it. 

        "Work" means any discovery, design, database or other work (whether registrable or not and whether a copyright work or not within the
meaning of the US Copyrights Act) which is not an Invention and which the Executive creates or is involved in creating: 

        10.3.1    in connection with his Employment (including in connection with the provision of his services as an
Executive Director of the UK Company); or 

        10.3.2    relating to those aspects of the businesses of the Group Companies in which he is involved. 

        10.4    The Executive: 

        10.4.1    assigns to the US Company to the extent allowed by law with full title guarantee all his right, title
and interest in any Work he creates or is involved in creating during his Employment; and 

        10.4.2    will act as a trustee for that company in relation to all such Works, 

and
will in either case at the request and expense of the US Company do everything reasonably necessary to vest all right, title and interest in any Work in the US Company or its nominee and to defend
its rights in those works and to secure appropriate protection anywhere in the world. 

        10.5    If the Executive becomes aware of any infringement or suspected infringement of any intellectual property
right in any Invention or Work he will promptly notify the US Company in writing. 

        10.6    The Executive will not copy, disclose or make use of any Invention or Work without the US Company's prior
written consent unless the disclosure is necessary for the proper performance of his duties. 

        10.7    So far as permitted by law the Executive irrevocably waives any rights he may have under Chapter IV
(Moral Rights) of part 1 of the Copyright, Designs and Patents Act 1988 and any foreign corresponding rights in respect of all Works. 

        10.8    Rights and obligations under this clause 10 will continue after the termination of this agreement
in respect of all Inventions and Works made or obtained during the Employment and will be binding on the personal representatives of the Executive. 

        10.9    The Executive agrees that he will not by his acts or omissions do anything which would or might prejudice
the rights of the US Company or the UK Company under this clause 10. 

        10.10    The Executive will not make copies of any computer files belonging to any Group Company or their service
providers unless he has obtained the consent of the US Board or of the UK Board, except for working files copied to a laptop or home computer solely to the extent necessary to perform his duties under
this agreement. 

9

 

        10.11    By entering into this agreement the Executive irrevocably appoints the US Company to act on his behalf to
execute any document and do anything in his name for the purpose of giving the US Company (or its nominee) the full benefit of the provision of this clause 10 or the US Company's entitlement
under statute. If there is any doubt as to whether such a document (or other thing) has been carried out within the authority conferred by this clause 10.12, a certificate in writing (signed by
any director or the secretary of the US Company) will be sufficient to prove that the act or thing falls within that authority. 

 
 

11    Termination and Suspension  

        11.1    The Employment will continue until terminated by either the US Company or the Executive giving written
notice as set out in this clause 11. 

        11.2    Either the US Company or the Executive may terminate the Employment by giving not less than
12 months' written notice to the other. 

        11.3    The US Company may at its discretion pay the Executive in lieu of any unexpired period of notice (whether
given by the US Company or Executive) (less any deductions the US Company is required by law to make): Such discretion will be subject to approval by the Group's Remuneration Committee who, in
determining payment, will have regard to current Group policy and comments, and recommendations of the UK Listing Authority's Listing Rules and associated guidance and good governance. 

        11.4    The US Company may terminate the Employment with immediate effect upon the "Disability" of the Executive.
The Executive shall be deemed to incur a Disability when (i) the US Company's medical department or its representative advises the US Company that the Executive's physical or mental condition
has rendered the Executive unable to perform the essential functions of the Executive's position in a reasonable manner, with or without reasonable accommodation, and will continue to render him
unable to perform the essential functions of the Executive's position in such manner for a period of at least twelve (12) consecutive months, or (ii) due to a physical or mental
condition, the Executive has not performed the essential functions of the Executive's position in a reasonable manner, with or without reasonable accommodation, for a period of twelve
(12) consecutive months. 

        11.4.1    If the Executive's employment is terminated during the Employment pursuant to this clause 11.4,
the Executive shall be entitled to receive continuation of disability benefits as provided under the Company's long-term disability plan as in effect immediately prior to the date of
termination; and benefit continuation as if an active employee until the Executive reaches the age of fifty-five (55). 

        11.5    The US Company may terminate the Employment with immediate effect by giving written notice if the
Executive: 

        11.5.1    commits any serious or persistent breach of any of his material obligations under this agreement or his
employment; or 

        11.5.2    is guilty of wilfully engaging in any gross misconduct which has a material adverse effect on the
business or affairs of any Group Company; or 

        11.5.3    is guilty of embezzlement, fraud, or other such dishonesty or is convicted of a criminal offence
involving moral turpitude or a felony; or 

        11.5.4    is bankrupted or has a receiving order made against him or makes any general composition with his
creditors or takes advantage of any statute affording relief for insolvent debtors; or 

10

 

        11.5.5    becomes disqualified from acting as a director of a company by order of a competent court. 

        11.6    The Executive will have no claim for damages or any other remedy against the US Company or the UK Company
if the Employment is terminated for any of the reasons set out in clause 11.5, provided said termination is based on the good faith opinion of no less than 3/4 of the US Board, after the
Executive has been given the opportunity to be heard, that the Executive was guilty of conduct set forth in clause 11.5. 

        11.7    The Executive may terminate the Employment for Good Reason with immediate effect if the US Company does
not cure within thirty (30) days of receipt of the Executive's notice of termination. In such instance, the US Company shall pay the Executive the amounts set forth in clause 11.3.
above. 

        11.8    When the Employment terminates the US Company may deduct from any money due to the Executive (including
remuneration) any amount which he owes to any Group Company. 

        11.9    11.9 The US Company may suspend the Executive from the Employment at any time, and for any reason for a
reasonable period to investigate any matter in which the Executive is implicated or involved (whether directly or indirectly) and to conduct any related disciplinary proceedings. During said
investigative period the Executive shall continue to receive his salary and benefits. 

 
 

12    Garden Leave  

        12.1    At any time after notice to terminate the Employment is given by either the US Company or the Executive
under clause 11 above (except as provided for in clause 11.7), or if the Executive resigns without Good Reason or without giving due notice and the US Company does not accept his
resignation, the US Company may require the Executive to comply with any or all of the provisions in clauses 12.2 and 12.3 for a maximum period of six months (the
"Garden Leave Period"). 

        12.2    The Executive will not, without prior written consent of the US Board, be employed or otherwise engaged in
the conduct of any activity, whether or not of a business nature during the Garden Leave Period. Further, the Executive will not, unless requested by the US Company: 

        12.2.1    enter or attend the premises of the US Company or any other Group Company; or 

        12.2.2    contact or have any communication with any customer or client of the US Company or any other Group
Company in relation to the business of the US Company or any other Group Company; or 

        12.2.3    contact or have any communication with any employee, officer, director, agent or consultant of the US
Company or any other Group Company in relation to the business of the US Company or any other Group Company; or 

        12.2.4    remain or become involved in any aspect of the business of the US Company or any other Group Company
except as required by such companies. 

        12.3    The US Company may require the Executive: 

        12.3.1    to comply with the provisions of clause 15; and 

        12.3.2    to immediately resign from any directorship which he holds in the UK Company, any other Group Company or
any other company where such directorship is held as a consequence or requirement of the Employment, unless he is required to perform duties to which any such directorship relates in which case he may
retain such directorships while those duties are ongoing. The Executive hereby irrevocably appoints the US Company to be his attorney to execute any 

11

 

instrument
and do anything in his name and on his behalf to effect his resignation if he fails to do so in accordance with this clause 12.3.2. 

        12.4    During the Garden Leave Period, the Executive will be entitled to receive his salary and benefits. Any
unused holiday accrued at the commencement of the Garden Leave Period and any holiday accrued during any such Period will be deemed to be taken by the Executive during the Garden Leave Period. 

        12.5    At the end of, or at any time during, the Garden Leave Period, the US Company may, at its sole and
absolute discretion, pay the Executive salary and benefits as set forth in clause 11.3 in lieu of the balance of any period of notice given by the US Company or the Executive (less any
deductions required by law). 

        12.6    All duties of the Employment (whether express or implied), including without limitation the Executive's
duties of fidelity, good faith and exclusive service, shall continue throughout the Garden Leave Period save as expressly varied by this clause. 

 
 

13    Protection of interests of the Group  

        13.1    In this Clause the expressions following bear the meanings ascribed to them respectively below, namely: 

        13.1.1    "Confidential Information" means trade secrets and
confidential information which are for the time being confidential to the US Company or the UK Company or (as the case may be) any other member of the Group; 

        13.1.2    "Garden Leave Period" has the meaning given in
Clause 12.1 hereof; 

        13.1.3    "Prohibited Area" means England, Scotland and Wales, and
any geographical area within the United States in which the US Company or the UK Company or any Relevant Group Company carries on a Restricted Business (as defined below) at the Termination Date; 

        13.1.4    "Relevant Group Company" means any Group Company
(excluding the US Company and the UK Company but including any predecessor of a Group Company) in respect of whose business the Executive has been directly concerned pursuant to the provisions of this
Agreement at any time during the period of two years prior to the Termination Date; 

        13.1.5    "Restricted Business" means the transmission,
distribution or supply of gas or electricity; 

        13.1.6    "Restricted Period" means the period of six months
commencing with the Termination Date but such period shall be reduced by one day for each day of a Garden Leave Period; and 

        13.1.7    "Termination Date" means the date on which the Executive
resigns without Good Reason. 

        13.2    Since the Executive is likely to obtain in the course of his duties under this Agreement Confidential
Information and personal knowledge of and influence over employees of Group Companies the Executive hereby agrees with the US Company and the UK Company that in addition to the other terms of this
Agreement and without prejudice to other restrictions imposed upon him by law, he will be bound by the following covenants: 

        13.2.1    that he will not during the Restricted Period either on his own behalf or for any other person (whether
as employee, consultant, adviser, principal, partner, agent, shareholder, director or otherwise) directly or indirectly carry on, or assist with, or be engaged in or concerned with, any Restricted
Business which competes with, or is about to compete with, any business carried on at 

12

 

the
Termination Date by the US Company or the UK Company or any other Relevant Group Company within the Prohibited Area ("NGT Business") if but only if 

        (i)    either
the Executive has been directly or substantially involved or concerned or had responsibility pursuant to the provisions of this Agreement for such NGT Business at
any time during the period of twelve months prior to the Termination Date; or 

        (ii)   in
the course of the Employment the Executive had access to and acquired knowledge of Confidential Information in relation to such NGT Business at any time during the
period of twelve months prior to the Termination Date 

PROVIDED
THAT this shall not restrict the Executive (including his spouse and children under 18 years of age) from holding or acquiring by way of bona fide investment only investments whether
or not listed or quoted representing not more than one per cent. of the issued investments of any class of any one company and shall not restrict any activity the performance of which could not
involve the Executive in such competition; 

        13.2.2    that he will not during the Restricted Period either on his own behalf or for any other person, whether
directly or indirectly entice or try to entice away from the US Company or the UK Company or any other Group Company any person who was a senior manager, in a senior technical position or a senior
sales position in such a company at the Termination Date and who had been in such a position at any time during the six months prior to the Termination Date and with whom he had worked closely at any
time during that period; and 

        13.2.3    that he shall not following the Termination Date represent himself as being in any way currently
connected with the business of the US Company or the UK Company or that of any Relevant Group Company (except to the extent agreed by such a company). 

        13.3    The Executive agrees that each of the paragraphs contained in Clause 13.2 above constitute an
entirely separate and independent covenant on his part and the validity of one paragraph shall not be affected by the validity or unenforceability of another. 

        13.4    The Executive agrees that he will at the request and cost of the US Company or the UK Company enter into a
direct agreement or undertaking with any Relevant Group Company whereby he will accept restrictions and provisions corresponding to the restrictions and provisions above (or such of them as may be
reasonable and appropriate in the circumstances) in relation to such activities and such areas and for such a period as such company may reasonably require for the protection of its legitimate
interests. 

        13.5    The Executive agrees that, having regard to the facts and matters set out above, the restrictive covenants
contained in this Clause 13 are necessary for the protection of the business and Confidential Information of the US Company and the UK Company and Relevant Group Companies. 

        13.6    The Executive and the US Company and the UK Company agree that while the restrictions imposed in this
Clause are considered necessary for the protection of the US Company, the UK Company and Relevant Group Companies, it is agreed that if any one or more of such restrictions shall either taken by
itself or themselves together be adjudged to go beyond what is reasonable in all the circumstances for the protection of the US Company, the UK Company or any Relevant Group Company's legitimate
interest but would be adjudged reasonable if any particular restriction or restrictions were deleted or if any part or parts of the wording thereof were deleted, restricted or limited in a particular
manner then the said restrictions shall apply with such deletions, restrictions or limitations as the case may be. 

        13.7    Any benefit given or deemed to be given by the Executive to any Group Company under the terms of
Clause 13 is received and held on trust by the US Company and the UK Company for the relevant Group Company. 

 
 
13

 

14    Offers on Liquidation  

        The Executive will have no claim against the US Company or the UK Company if the Employment is terminated by reason of liquidation in order to reconstruct or
amalgamate the US Company or by reason of any reorganisation of the US Company and the Executive is offered Employment with the company succeeding to the US Company upon such liquidation or
reorganisation and the new terms of Employment offered to the Executive are no less favourable to him than the terms of this agreement. 

 
 

15    Return of Company Property  

        15.1    At any time during the Employment (at the request of the US Company or the UK Company) and in any event
when the Employment terminates, the Executive will immediately return to the relevant Company: 

        15.1.1    all documents and other materials (whether originals or copies) made or compiled by or delivered to the
Executive during the Employment and concerning all the Group Companies. The Executive will not retain any copies of any materials or other information; and 

        15.1.2    all other property belonging or relating to any of the Group Companies. 

        15.2    If the Executive commences a Garden Leave Period in accordance with clause 12 he may be required to
comply with the provisions of clause 15.1. 

 
 

16    Directorships  

        16.1    The Executive's office as a director of the UK Company or any other Group Company is subject to the
Articles of Association of the relevant company (as amended from time to time). If the provisions of this agreement conflict with the provisions of the Articles of Association, the Articles of
Association will prevail. 

        16.2    The Executive must resign from any office held in any Group Company if he is asked to do so by the US
Company or the UK Company. 

        16.3    If the Executive does not resign as an officer of a Group Company, having been requested to do so in
accordance with clause 16.2, the US Company will be appointed as his attorney to effect his resignation. By entering into this agreement, the Executive irrevocably appoints the US Company as
his attorney to act on his behalf to execute any document or do anything in his name necessary to effect his resignation in accordance with clause 16.2. If there is any doubt as to whether such
a document (or other thing) has been carried out within the authority conferred by this clause 16.3, a certificate in writing (signed by any director or the secretary of the US Company) will be
sufficient to prove that the act or thing falls within that authority. 

        16.4    During the Employment the Executive will not knowingly do anything which could cause him to be
disqualified from continuing to act as a director of any Group Company. 

        16.5    The Executive must not resign his office as a director of any Group Company without the agreement of the
US Company or the UK Company. 

 
 

17    Notices  

        17.1    Any notices given under this agreement must be given by letter or fax. Notice to the US Company must be
addressed to 25 Research Drive, Westborough, MA 01582 at the time the notice is given. Notice to the Executive must be given to him personally or sent to his last known address. 

14

  

        17.2    Except for notices given by hand, notices given by post will be deemed to have been given on the next
working day after the day of posting and notices given by fax will be deemed to have been given in the ordinary course of transmission. 

 
 

18    Data Protection Act 1998  

        18.1    For the purposes of the Data Protection Act 1998 (the
"Act") the Executive gives his consent to the holding, processing and disclosure of personal data (including sensitive data within the meaning of the
Act) provided by the Executive to the US Company and to the UK Company to the extent required to carry out the applicable provisions of this agreement including, but not limited to: 

        18.1.1    administering and maintaining personnel records; 

        18.1.2    paying and reviewing salary and other remuneration and benefits; 

        18.1.3    providing and administering benefits (including if relevant, pension, life insurance, health insurance
and medical insurance); 

        18.1.4    undertaking performance appraisals and reviews; 

        18.1.5    maintaining sickness and other absence records; 

        18.1.6    taking decisions as to the Executive's fitness for work; 

        18.1.7    providing references and information to future employers, and if necessary, governmental and
quasi-governmental bodies for social security and other purposes, including (in the UK) the Inland Revenue and (in the US) the IRS; 

        18.1.8    providing information to future purchasers of the US Company or of the UK Company or of the business in
which the Executive works; 

        18.1.9    transferring information between the Group Companies; and 

        18.1.10    transferring information concerning the Executive to a country or territory outside the EEA. 

        18.2    The Executive acknowledges that during his Employment he will have access to and process, or authorise the
processing of, personal data and sensitive personal data relating to employees, customers and other individuals held and controlled by the US Company and/or the UK Company. The Executive agrees to
comply with the terms of the Act in relation to such data and to abide by the US Company's and/or the UK Company's data protection policy issued from time to time. 

 
 

19    Third Party Claims  

        19.1.1    Except as provided in clause 20.2 below, the extent permitted by law no person other than the
parties to this agreement and the Group Companies shall have the right to enforce any term of this agreement under the Contracts (Rights of Third Parties) Act 1999. For the avoidance of doubt, save as
expressly provided in this clause, the application of the Contracts (Rights of Third Parties) Act 1999 is specifically excluded from this agreement, although this does not affect any other right or
remedy of any third party which exists or is available other than under this Act. 

        19.1.2    If the Executive is made a party, or is threatened to be made a party, to any action, suit, or
proceeding, whether civil, criminal, administrative, or investigative (a "Proceeding") by reason that he was a director, officer, employee, agent or representative of any Group Company (including
service with respect to any employee benefit plan), the Executive shall be indemnified and held harmless by the US Company and the UK Company to the fullest extent legally permitted against all cost,
expense, liability and loss (including attorneys' fees) reasonably incurred or suffered by the Executive in connection with the Proceeding. Such indemnification shall 

15

 

continue
as to the Executive even if he has ceased to be a director, officer, employee, agent, or representative of any Group Company and shall inure to the benefit of the Executive's heirs and legal
representation. 

 
 

20    Miscellaneous  

        20.1    This agreement may only be modified by the written agreement of the parties. 

        20.2    This agreement shall be binding upon and shall inure to the benefit of the parties and their respective
successors, heirs (in the case of the Executive), and assigns; provided, however, that no rights or obligations under this Agreement may be assigned by the Executive other than his rights to
compensation and benefits which may be transferred only by will or operation of law. In the event of the Executive's death, references in this Agreement shall be deemed, where appropriate, to refer to
his beneficiary, estate, or other legal representative. 

        20.3    References in this agreement to rules, regulations, policies, handbooks or other similar documents which
supplement it, are referred to in it or describe any pensions or other benefits arrangement are references to the versions or forms of the relevant documents as amended or updated from time to time. 

        20.4    This agreement supersedes any previous written or oral agreement between the parties in relation to the
matters dealt with in it. It contains the whole agreement between the parties relating to the Employment at the date the agreement was entered into (except for those terms implied by law which cannot
be excluded by the agreement of the parties or for those terms which are contained in other plans, policies or arrangements referenced in but not included in this agreement). The Executive
acknowledges that he has not been induced to enter into this agreement by any representation, warranty or undertaking not expressly incorporated into it. The Executive agrees and acknowledges that his
only rights and remedies in relation to any representation, warranty or undertaking made or given in connection with this agreement (unless such representation, warranty or undertaking was made
fraudulently) will be for breach of the terms of this agreement, to the exclusion of all other rights and remedies (including those in tort or arising under statute). 

        20.5    None of the parties' rights or powers under this agreement will be affected if: 

        20.5.1    one party delays in enforcing any provision of this agreement; or 

        20.5.2    one party grants time to any other party. 

        20.6    References to any statutory provisions include any modifications or amendments to those provisions. 

        20.7    Headings will be ignored in construing this agreement. 

        20.8    If any party agrees to waive his or its rights under a provision of this agreement, that waiver will only
be effective if it is in writing and it is signed by the party against whom or which such waiver is sought. A party's agreement to waive any breach of any term or condition of this agreement will not
be regarded as a waiver of any subsequent breach of the same term or condition or a different term or condition. 

16

 

        20.9    This agreement is governed by and will be interpreted in accordance with the laws of the Commonwealth of
Massachusetts. 

	EXECUTED on behalf of	 	/s/ R. J. Urwin
	NATIONAL GRID TRANSCO PLC	 	 	 	Director
	

 	
 	

 	
 	

/s/ Helen Mahy

Company Secretary/Director
	
EXECUTED on behalf of	
 	

/s/ John G. Cochrane
	NATIONAL GRID USA	 	 	 	Director
	

 	
 	

 	
 	

/s/ Larry Reilly

Company Secretary/Director
	

 	
 	

 	
 	

 
	
EXECUTED by
 MICHAEL E. JESANIS

in the presence of:	
 	

}

}

}	
 	

          

/s/ Michael E. Jesanis
	

Witness's signature	
 	

 	
 	

/s/ P. Fulker
	

Name	
 	

 	
 	

P. Fulker
	Address	 	 	 	2 Fourstones Close

Solihull

W. Mids

UK
	

Occupation	
 	

 	
 	

Group HR Director

17

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