Document:

Exhibit 4(c).7b

 

Description of amendment to the Employment
Contract dated 23 July 2003 between Westpac Banking Corporation and Michael
Coomer during 2003/2004

 

During 2003/2004, Westpac Banking Corporation and Michael Coomer agreed
to amend clause 6 of Michael Coomer’s Employment Contract to give effect to the
following:

 

While Michael Coomer is required to live away from his normal place of
business to fulfil his duties of employment with Westpac, Michael Coomer will
be provided with rental assistance of up to $2,000 per week. The assistance
will be in the form of rent payable directly by Westpac on behalf of Michael
Coomer.

 

Westpac will provide Michael Coomer with a travel allowance of $25,000
per annum and Westpac will also pay any associated fringe benefits tax on the
travel allowance.Exhibit 4(c).12C

 

Chief
Executive Share Option Agreement
2001

 

Westpac
Banking Corporation

 

David
Raymond Morgan

 

 

Aliens
Arthur Robinson

The
Chifley Tower

2
Chifley Square

Sydney
NSW 2000

Australia

Tel
61 2 9230 4000

Fax
61 2 9230 5333

www.aar.com.au

 

©
Copyright Aliens Arthur Robinson 200I

 

 

	
  Chief Executive Share
  Option Agreement

  	
   

  
	
  2001

  	
  Al1ens
  Arthur Robinson

  

 

Table of Contents

 

	
  1.

  	
  Interpretation

  	
   

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Condition Precedent

  	
   

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Grant of Options

  	
   

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Exercise Price

  	
   

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Right to exercise Options

  	
   

  
	
   

  	
  5.1

  	
  Right

  	
   

  
	
   

  	
  5.2

  	
  Exercise Period

  	
   

  
	
   

  	
  5.3

  	
  Employment and Performance Requirements

  	
   

  
	
   

  	
  5.4

  	
  Lapse of Options

  	
   

  
	
   

  	
  5.5

  	
  Restriction on disposal of Shares

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  6.

  	
  Manner of exercise of Options

  	
   

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Adjustment
  for rights issue

  	
   

  
	
   

  	
   

  	
   

  
	
  8.

  	
  Adjustment for bonus issue

  	
   

  
	
   

  	
   

  	
   

  
	
  9.

  	
  Adjustment for reconstruction etc

  	
   

  
	
   

  	
   

  	
   

  
	
  10.

  	
  Cumulation
  of adjustments

  	
   

  
	
   

  	
   

  	
   

  
	
  11.

  	
  Participation
  in other opportunities

  	
   

  
	
   

  	
   

  	
   

  
	
  12.

  	
  Consultation
  on reconstruction, alterations etc

  	
   

  
	
   

  	
   

  	
   

  
	
  13.

  	
  General provisions

  	
   

  

 

 

i

 

	
  Date

  	
   

  	
  19 December,
  2001

  
	
   

  	
   

  	
   

  
	
  Parties

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  WESTPAC BANKING
  CORPORATION (ABN 33 007 457 141) of 60 Martin Place, Sydney (the Bank)

  
	
   

  	
   

  	
   

  
	
  2.

  	
   

  	
  DAVID RAYMOND MORGAN, the
  Managing Director and Chief Executive Officer of the Bank (the Officer)

  
	
   

  	
   

  	
   

  
	
  Recitals

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  A

  	
   

  	
  In consideration of the
  services to be rendered by the Officer to the Bank during the term of his
  office, options shall be granted to the Officer on the following terms and
  conditions.

  
	
   

  	
   

  	
   

  
	
  B.

  	
   

  	
  The Bank’s shareholders
  have approved the grant of options contemplated by this Agreement for the
  purposes of ASX Listing Rule 10.14.

  

 

Operative Provisions

 

1.             Interpretation

 

1.1           In this agreement, unless the context or subject matter
otherwise indicates or requires

 

ASX means Australian Stock Exchange Limited or
any successor body

 

Board means the directors of the Bank acting as a
Board.

 

Business Day means a day on which the ASX is open for trading
in Sydney

 

Corporations Act means the Corporations Act 2001 (Cth).

 

Current Plans means the Bank’s Senior Officers’ Share
Purchase Scheme, the Bank’s Employee Share Plan, and the Bank’s General
Management Share Option Plan or any other employee incentive scheme in addition
to or in substitution of any of the foregoing.

 

End Date means, in respect of

 

(a)           the First option, 29 February 2012; and

 

(b)           the Second option, 28 February 2013.

 

Exercise Day means a day on which the Officer delivers a
notice to the Bank under clause 6.1

 

Exercise Period means the period during which an Option may be
exercised in accordance with clause 5.2.

 

Exercise Price means, in respect of all Shares the subject
of any Option, the Market Price

 

First option means the Option to be granted to the Officer
in accordance with clause 3.1.

 

1

 

First Exercise Date means for each Option, the date on which the
determination of the Board under clause 5.3, in respect of that Option, becomes
final and binding.

 

Grant Date means the date of grant of an Option under
clause 3

 

Life means, in relation to an Option, the period
between the Grant Date and its lapse pursuant to clause 5.4.

 

Market Price means, in respect of a Share, the weighted
average market price per Share (rounded to the nearest whole cent, with
one-half of one cent being rounded down) of all Shares traded (excluding trades
identified by the ASX as carrying “Off-SEATS Condition Codes and all special market
trades) on the ASX during the one week period immediately prior to (but excluding):

 

(a)           March 2002 in respect of the First option; and

 

(b)           1 March 2003 in respect of the Second option.

 

Maximum TSR Ranking means the TSR Ranking equal to 75% or such
other percentage as determined by the Board at the time of determination of the
Performance Requirements.

 

Mid-Range TSR Ranking means the TSR Ranking equal to 50% or such
other percentage as determined by the Board at the time of determination of the
Performance Requirements.

 

Minimum Shareholding Requirement means that number of Shares that the Board
(or a committee of the Board) determines from time to time in its absolute
discretion must be held by the Officer at any time during his employment with
the Bank, as advised in writing to the Officer from time to time.

 

Minimum TSR Ranking means the TSR Ranking equal to 25% or such
other percentage as determined by the Board at the time of determination of the
Performance Requirements.

 

Option means, according to the context, the First
option or the Second option.

 

Peer Group means the 50 bodies corporate other than the
Bank comprised in the ASX All Industrials Index and which have the highest
market capitalisation recorded by the ASX at the commencement of the Performance
Period provided that if during the Performance Period any of those bodies
corporate cease to comprise that index for any reason the Peer Group will
consist of the remainder of those bodies corporate, or such other bodies
corporate and in such number as the Board determines should comprise the Peer
Group.

 

Performance Period means, subject to clause 5.3(d):

 

(a)                                  in the case of the First option, the period
commencing on 1 March 2002 and ending on 1 March 2005; and 

 

(b)                                 in the case of the Second option, the period
commencing on 1 March 2003 and ending on 1 March 2006.

 

Performance Requirements means the requirements set out in clause
5.3(f).

 

Retirement means the voluntary cessation of employment
of the Officer with the Bank solely by reason of the Officer having notified
the Board of his intention to permanently leave the workforce, and Retire has a corresponding meaning.

 

Second option means the Option to be granted to the Officer
in accordance with clause 3.2.

 

Share means:

 

2

 

(a)                                  while the Bank’s issued capital consists predominantly
of ordinary shares — those ordinary shares; and

 

(b)                                 if at any time the Bank’s issued share
capital consists predominantly of ordinary shares of some other description by
virtue of an event of a kind dealt with by clause 9 — those ordinary shares.

 

Total and permanent disablement means permanent physical or mental incapacity
that, in the reasonable opinion of the Board based on a full medical report and
a certificate to that effect from each of at least 2 registered medical
practitioners, is likely to result in the Officer being incapable of continuing
to perform the Officer’s duties as Chief Executive Officer and Managing
Director of the Bank, and Totally and permanently
disabled has a corresponding meaning. 

 

TSR means, in respect of a body corporate, the
total shareholder return (including dividends) of the

body corporate being the amount calculated on the
following basis:

 

Step 1 – Calculate the average daily closing price quoted by the ASX of an
ordinary share of the body corporate over the three months immediately
preceding the end of the Performance Period.

 

Step 2 – Add the amount calculated in Step 1 and any cash distribution under a
return of capital of the body corporate to shareholders generally during the Performance
Period.

 

Step 3 – Calculate the average daily closing price quoted by the ASX of an
ordinary share of the same body corporate over the three months immediately
preceding the start of the Performance Period.

 

Step 4 – Divide the result from Step 2 by the result from Step 3.

 

Step 5 – Divide the amount of each dividend paid on an ordinary share of the
same body corporate during the Performance Period by the closing price quoted
by the ASX of the ordinary shares of the same body corporate on the date of
payment of the respective dividend. Each of these amounts is a dividend yield.
Add each of the dividend yields for a Performance Period together.

 

Step 6 – Add together the integer one (1) and the result from Step 5

 

Step 7 – Multiply the result from Step 4 with the result from Step 6.

 

Step 8 – Subtract the integer one (1) from the result from Step 7. This amount is
the TSR for that body corporate,

 

and the Board may make such
other adjustments as it thinks necessary for any capital reconstruction of that
body corporate during the Performance Period, including bonus issues, share
splits and share consolidations.

 

TSR Ranking means the percentage ranking of the Bank or a
body corporate amongst the group comprising the Peer Group and the Bank, ranked
in ascending order according to their TSRs.

 

1.2                                 A reference to public announcement of a
matter is a reference to an announcement of that matter by the Bank to the ASX.

 

l.3                                    A reference to Shares the subject of an
Option is a reference to the Shares for which the Officer has an option to subscribe
by reason of the grant to him of that Option, including any Shares or other securities
resulting from an adjustment made pursuant to this agreement.

 

3

 

1.4                                 A reference to the Exercise Price applicable
to each Share the subject of an Option is a reference to the subscription price
applicable to each such Share by operation of clause 4 or, if that subscription
price is less than each Share’s nominal amount, that nominal amount.

 

1.5                                 A reference to an offer, issue or
distribution to the Bank’s shareholders generally is a reference to an offer,
issue or distribution to the generality of the holders for the time being of
Shares, whether or not including holders of other securities issued by the Bank
and whether or not including persons in particular places outside Australia or
other minority groups who may for good reason be excluded from participation.

 

1.6                                 Headings in this agreement are for
convenience only and do not affect its interpretation.

 

2.             Condition Precedent

 

No rights shall accrue to
the Officer under this Agreement and the Bank shall have no obligations under
this Agreement:

 

(a)                                  in respect of the First option, unless the
Officer is employed by the Bank in an executive position on 1 March 2002; or

 

(b)                                 in respect of the Second option, unless the
Officer is employed by the Bank in an executive position on 1 March 2003.

 

3.             Grant of Options

 

3.1                                 Subject to the satisfaction of the condition
precedent set out in clause 2(a) the Bank shall grant to the Officer on 1 March
2002 an option to subscribe for up to 1,100,000 Shares with the actual number of
Shares being subject to adjustment in accordance with clauses 7, 8, 9 and 10
and as determined in accordance with clauses 5.2 and 5.3.

 

3.2                                 Subject to the satisfaction of the condition
precedent set out in clause 2(b) the Bank shall grant to the Officer on 1 March
2003 an option to subscribe for up to 1,100,000 Shares with the actual number of
Shares being subject to adjustment in accordance with clauses 7, 8, 9 and 10
and as determined in accordance with clauses 5.2 and 5.3.

 

3.3                                 Promptly following the Grant Date of each
Option the Bank must deliver to the Officer a separate certificate evidencing that
Option and setting out the terms of its issue as prescribed by this Agreement.

 

3.4                                 Each
Option is personal to the Officer and may not be exercised by any other person
(except, in the case of the Officer’s death, his legal personal representative)
nor may it be assigned, novated, disposed of, pledged or otherwise be held
subject to a security or third party interest.

 

4.             Exercise Price

 

The Exercise Price in
respect of each Share the subject of any Option is an amount equal to the Market
Price.

 

4

 

5.             Right to exercise Options

 

5.1           Right

 

An Option may be exercised:

 

(a)                                  at any time during the Exercise Period,
except as provided in clause 5.2, and only if the conditions applicable to its
exercise under clause 5.3(a) are satisfied; and

 

(b)                                 in respect of either the whole number of
Shares that remain the subject of the Option or any lesser number being at
least 50,000 Shares.

 

Where an Option is exercised
in part as contemplated by paragraph (b), the number of Shares the subject of
the Option shall be reduced following that exercise by the number of Shares in
respect of which the Option bas been exercised. Subject to the minimum exercise
number of 50,000 Shares stated in paragraph (b), there is no limit to the
number of occasions on which part exercise of an Option may occur.

 

5.2           Exercise
Period

 

(a)                                  Except as provided in this clause 5.2, an
Option may only be exercised during the period commencing on the First Exercise
Date and ending on the End Date.

 

(b)                                 If at any time after the Grant Date of an
Option and prior to:

 

(i)                                     the first anniversary of the commencement of the
Performance Period of that Option, the Officer ceases to be an employee of the
Bank in an executive position as a consequence of the Officer:

 

(A)          becoming Totally and permanently
disabled;

 

(B)           Retiring, with the consent of the
Board; or

 

(C)           dying; or

 

(ii)                                  the First Exercise Date in respect of that
Option, the Officer ceases to be an employee of the Bank in an executive
position as a consequence of the Officer resigning,

 

the Board may in its absolute
discretion, and notwithstanding that any or all of the conditions of exercise
in clauses 5.1 and 5.3 have not been satisfied, permit the exercise of that
Option at any time during the period of 12 months after the Officer so ceases
to be such an employee, PROVIDED THAT:

 

(1)                                  if this discretion is exercised prior to 1
March 2003 as a consequence of the Officer ceasing to be such an employee
pursuant to paragraph (b) (i), it may only be exercised in relation to the
First option;

 

(2)                                  if this discretion is exercised on or after 1
March 2003 but before 1 March 2004 as a consequence of the Officer ceasing to
be such an employee pursuant to paragraph (b)(i), it may only be exercised in
relation to the Second option.

 

5

 

 

In exercising this
discretion, the Board may impose such conditions (including the number of
Shares in respect of which an Option may be exercised) on the exercise of that
Option as it considers appropriate.

 

(c)           If at any time on or after the first anniversary of the
commencement of the Performance Period of an Option and before the First
Exercise Date in respect of that Option, the Officer ceases to be an employee
of the Bank in an executive position as a consequence of the Officer:

 

(i)            becoming
Totally and permanently disabled;

 

(ii)           Retiring,
with the consent of the Board; or

 

(iii)          dying,

 

the Officer may, subject to
the conditions of exercise in clauses 5.1 and 5.3 (apart from clause 5.3(a)(i)
being satisfied, exercise that Option at any time during the period commencing
on the First Exercise Date and ending on the earlier to occur of:

 

(A)          the End Date; and

 

(B)           the fifth anniversary of the date on
which the Officer so ceased to be such an employee or such later date (being
not later than the End Date) as the Board may, in its absolute discretion,
determine.

 

(d)           If at any time after the Grant Date of an Option and prior
to the First Exercise Date in respect of that Option:

 

(i)            the Officer ceases to be an employee of the Bank in an
executive position because his employment is terminated by the Board for other
than serious misconduct;

 

(ii)           there is a material adverse change in the authority or
status of the Officer or his responsibilities are materially diminished; or

 

(iii)          the duties of the Officer assigned by the Board change, or
are such that they are no longer, consistent with the role of Chief Executive
Officer or Managing Director,

 

the Officer may,
notwithstanding anything to the contrary in this agreement, exercise that
Option in respect of all Shares the subject of that Option at any time during the
period commencing on the date on which any one or more of the events referred
to in paragraphs (d)(i), (d)(ii) and (d)(iii) occurs and ending on the End
Date.

 

(e)           If
on or after the First Exercise Date in respect of an Option:

 

(i)            (A)          there
is a material adverse change in the authority or status of the Officer or his
responsibilities are materially diminished; or

 

 

(B)           the duties of the Officer assigned by the Board change, or are such that
they are no longer consistent with the role of Chief Executive Officer or
Managing Director,

 

the Officer may exercise
that Option at any time during the period commencing on the date on which any one
or more of the events referred to in this paragraph (e)(i) occurs and ending on
the End Date; or

 

6

 

(ii)           the Officer ceases to be an employee of the Bank in an
executive position as a consequence of:

 

(A)          the Officer’s employment being
terminated by the Board for other than serious misconduct;

 

(B)           the death or Total and permanent
disablement of the Officer; or

 

(C)           the Officer’s Retirement;

 

the Officer may exercise
that Option at any time during the period commencing on the date on which the
Officer so ceases to be such an employee and ending on the earlier to occur of:

 

(1)           the End Date; and

 

(2)           the fifth anniversary of the date on which the Officer so ceased to be
such an employee or such later date (being not later Date the End Date) as the
Board may, in its absolute discretion, determine; or

 

(iii)          the Officer ceases to be an employee of the Bank in an
executive position as a consequence of the Officer resigning- the Exercise Period in respect of that Option ends on the earlier of the
End Date and the day which is 3 months after the Officer’s employment ceases or
such later date (being not later than the End Date) as the Board may, in its
absolute discretion, determine; or

 

(iv)          the Officer ceases to be an employee of the Bank in an
executive position for any reason not contemplated by paragraphs (e)(ii) and
(e)(iii) - the Exercise Period in respect of that Option
ends on the earlier of the End Date and the day which is 3 months after the
Officer’s employment ceases.

 

5.3           Employment and
Performance Requirements

 

(a)           Except as provided in clause 5.2, an Option may only be
exercised if:

 

(i)            the Officer is an employee of the Bank in an executive
position on the First Exercise Date in respect of that Option; and

 

(ii)           the performance Requirements for the performance Period
have been met.

 

(b)           With
respect to each Option, promptly following the relevant Performance Period the
Board will:

 

(i)            determine
whether and. if so, the extent to which the performance Requirements applicable
to that performance Period have been met; and 

 

(ii)           subject to paragraphs (c), (d) and (e) of this clause 5.3,
clauses 7 through to 10 inclusive and clause 12, determine the number of Shares
in respect of which the Option may be exercised. with the Option to lapse in
relation to the remaining Shares.

 

(c)           Following a determination made by the Board under
paragraph (b). the Board shall inform the Officer by written notice:

 

(i)            as
to whether or not the Performance Requirements have been met;

 

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

 

7

 

(iii)          the Exercise Price; and

 

(iv)          of the Officer’s extension right under paragraph (d) .

 

(d)           After
making the first determination under paragraph (b) with respect to an Option,
the Board will inform, in accordance with paragraph (c), the Officer of his
right to extend the Performance Period by one year and, if that right is
exercised by the Officer within 30 days of the date of the notice of that first
determination under paragraph (c), the provisions of this clause 5.3 will be
applied again 12 months later by reference to the extended Performance Period.
A second extension right will be available 12 months later but only if the
Officer elected to extend the Performance Period in the previous year.

 

(e)           A determination of the Board under paragraph (b)(ii) shall
become final and binding 30 days after the date of the notice of that
determination under paragraph (c), unless the Officer exercises his right under
paragraph (d) before that time, in which event that determination is of no
effect.

 

(f)            For the purposes of this agreement, the Board shall,
before the commencement of the Performance Period applicable to the Second
option, establish performance requirements for that Performance Period which
are based in whole or in part on the provisions set out below in sub-paragraphs
(i) to (iv). The Performance Requirements for the Performance Period applicable
to the First option and, unless the Board determines otherwise, the Performance
Requirements for the Performance Period applicable to the Second option, shall
be as follows:

 

(i)            where the TSR Ranking of the Bank is less than the
Minimum TSR Ranking, the number of Shares in respect of which an Option shall
become exercisable under paragraph (b)(ii) shall be zero;

 

(ii)           where
the TSR Ranking of the Bank is equal to the Minimum TSR Ranking, the number of
Shares in respect of which an Option shall become exercisable under paragraph
(b)(ii) shall be the number equal to 25% of the total number of Shares the
subject of that Option;

 

(iii)          where the TSR Ranking of the Bank is equal to or greater
than the Maximum TSR Ranking, the number of Shares in respect of which an
Option shall become exercisable under paragraph (b)(ii) shall be the number
equal to 100% of the total number of Shares the subject of that Option; and

 

(iv)          where
the TSR Ranking of the Bank is greater than the Minimum TSR Ranking and less
than the Maximum TSR Ranking, the number of Shares in respect of which an
Option shall become exercisable under paragraph (b)(ii):

 

(A)          shall
increase on a straight line basis from the percentage of Shares the subject of
that Option set out in paragraph (f)(ii) to 50% of those Shares where the TSR
Ranking of the Bank is equal to the Mid-Range TSR Ranking; and

 

(B)           shall,
where the TSR Ranking of the Bank is greater than the Mid-Range TSR Ranking
further increase on a straight line basis from 500% to 100% of the total number
of Shares the subject of that Option.

 

8

 

(g)           In this agreement:

 

(i)            all
calculations shall be done to not less than 3 decimal places;

 

(ii)           no
rounding shall occur in respect of calculating the number of Shares in respect
of which an Option is exercisable by the Officer until the Board makes a
determination under paragraph (b) and any such rounding shall be rounded up, if
the resulting fraction (if any) is a value of 0.5 or more, and shall be rounded
down, if the resulting fraction (if any) is a value of less than 0.5;

 

(iii)          no rounding shall occur in respect of calculating the
number of Share or other securities comprising an Option until
the Officer lodges an Exercise Notice and any such rounding:

 

(A)          shall be calculated only in respect of the aggregate number
of Shares in respect of which an Option is exercised; and

 

(B)           shall be rounded up, if the resulting fraction (if any) is
a value of 0.5 or more, and shall be rounded down, if the resulting fraction
(if any) is a value of less than 0.5.

 

5.4           Lapse of
Options

 

(a)           If for any reason the Officer ceases to be an employee of
the Bank in an executive position before the First Exercise Date in respect of
an Option, and that Option has not become exerciseable under clause 5.2, that
Option shall lapse.

 

(b)           An
Option which has not been exercised as to the whole of the Shares the subject
of it on or before the last day of the Exercise Period shall thereupon lapse;
and an Option which is exercised as to the whole of the Shares the subject of
it, or which remains unexercised in respect of less than 50,000 Shares, shall
lapse when it is last exercised.

 

5.5           Restriction on
disposal of Shares

 

If the Officer exercises an
Option in accordance with clause 6, and at that time the Officer is not
complying with the Minimum Shareholding Requirement, then the Board may,
subject to the listing rules of the ASX, request the Bank’s share registrar to
place a holding lock on the whole or a portion of the Shares in respect of
which that Option is being exercised until such time as the Minimum Shareholding
Requirement is fully satisfied by the Office.  If only a portion of such Shares are to be
subject to a holding lock, the Board may direct that those Shares be registered
in a separate holding to the balance of the Shares the subject of that exercise.

 

6.             Manner of
exercise of Options

 

6.1           An
Option may only be exercised by delivery to the Bank’s Secretary (at a time
when the Option may be exercised) of:

 

(i)            the certificate for that Option;

 

(ii)           a notice
addressed to the Bank and signed by the Officer stating that he exercises the
Option and specifying the number of Shares the subject of the Option in respect
of which it is exercised; and

 

9

 

payment to the Bank in
cleared funds of the Exercise Price applicable to all of the Shares so
specified.

 

6.2           If the items specified in clause 6.1 are
delivered in accordance with that clause, the Bank must:

 

(i)            allot to the Officer the Shares in respect of which the
Option is exercised, together with any additional Shares an entitlement to
which has arisen under clause 7 in consequence of exercise of the Option, which
allotment must be on the footing that the Shares shall be allocated immediately
and rank pari passu in all respects with Shares already on issue on the
Exercise Day;

 

(ii)           deliver to the Officer a certificate or holding statement
in respect of the Shares so allotted; and

 

(iii)          cancel the certificate delivered pursuant to clause 6.1(i)
and, if any Shares remain the subject of the Option after the exercise (being
50,000 Shares or more), deliver to the Officer a replacement certificate for
the Option to reflect the reduced number of Shares the subject of it.

 

6.3           If
the Officer has died, the Officer’s legal personal representative shall stand
in the place of the Officer for the purposes of clause 6.1 and 6.2 subject only
to prior production to the Bank of such evidence as would be required to permit
the legal personal representative to become registered as a shareholder in
respect of Shares held by the Officer.

 

6.4           After Shares have been allotted pursuant to clause 6.2, the
Bank must promptly make application for official quotation of those Shares on
the ASX.

 

7.             Adjustment for rights issue

 

If, during the Life of each
Option:

 

(i)            Shares are offered pro rata for subscription by the
Bank’s shareholders generally (otherwise than pursuant to any of the Current
Plans) by way of a rights issue; and

 

(ii)           the price at which each Share is so offered is less than
the Market Price as at the day of public announcement of the rights issue,

 

the Exercise Price
applicable to each Share then the subject of that Option shall be reduced by
the value of the theoretical rights entitlement per cum rights Share (but shall
in no event be reduced below the par value of a Share (while Shares have a per
value)) and that theoretical rights entitlement per cum rights Share shall be
taken to have a value calculated by applying the formula:

 

P-(S+D)

(N+1)

where:

 

P=           the weighted average price of all fully paid
Shares sold in the ordinary course of trading on the ASX during the 5 Business
Days after the day of public announcement of the rights issue;

 

S=           the
aggregate price per Share payable for each new Share under the rights issue;

 

D=           any
dividends due but not yet paid on existing Shares which will not be payable in
respect of new Shares issued under the rights issue; and

 

10

 

N=           the
number of cum rights Shares required to be held to receive a right to one new
Share under the rights issue.

 

8.             Adjustment for bonus issue

 

8.1           If, during the Life of each Option, Shares are issued pro
rata to the Bank’s shareholders generally (otherwise than pursuant to any
Current Plan) by way of a bonus issue involving capitalisation of reserves or
distributable profits, the Officer shall be entitled, upon later exercise of
that Option as to some or all of the Shares the subject of it, to receive in
addition to the Shares in respect of which that Option is exercised an
allotment of so many additional Shares as would have been issued to a
shareholder who, on the date for determining entitlements under the bonus
issue, held Shares equal in number to the Shares in respect of which that
Option is exercised.

 

8.2           Additional Shares to which the Officer becomes so entitled
shall, as from the time Shares are issued pursuant to the bonus issue and until
those additional Shares are allotted, be regarded as Shares the subject of the
relevant Option for the purposes of subsequent applications of clause 8.1 and
any adjustments which, after the time just mentioned, are made under clause 9
to the number of Shares then the subject of an Option shall also be made to the
additional Shares as if they were Shares the subject of that Option.

 

9.             Adjustment for reconstruction etc

 

9.1           If,
during the Life of each Option, Shares are subdivided into shares of smaller
fixed amount or consolidated into shares of larger fixed amount or there is a
bonus issue not involving the capitalisation of reserves or distributable
profits, that Option shall thereupon be taken to be the subject of so many
Shares of the new fixed amount as the subdivision or consolidation would have
produced from the Shares the subject of that Option immediately before the
subdivision or consolidation had the Shares then the subject of that Option
been on issue immediately before the subdivision or consolidation and the
Exercise Price applicable to each Share of the new fixed amount the subject of
that Option shall be correspondingly adjusted.

 

9.2           If,
after the First Exercise Date of each Option, the Bank makes a return of
capital to its shareholders generally, the Exercise Price applicable to each
Share then the subject of that Option shall be reduced by the amount of the
capital returned in respect of each Share.

 

9.3           If,
during the Life of each Option, there occurs any other reconstruction of the
capital of the Bank affecting issued shares, the Shares then the subject of
that Option and the Exercise Price applicable to each such Share shall be
adjusted in conformity with the reconstruction and so that:

 

(i)            each benefit, if any, made available to shareholders
generally through the reconstruction shall be made available to the Officer
through that Option; and

 

(ii)           no
benefit not made available to shareholders generally through the reconstruction
shall be made available to the Officer through that Option.

 

11

 

10.          Cumulation of adjustments

 

Full effect shall be given
to clauses 7, 8 and 9 as and when occasions of their application arise and in
such manner that the effects of the successive applications of them are
cumulative, the intention being that the adjustments they progressively effect
shall be such as to reflect in relation to the Shares then the subject of an
Option the adjustments which on the occasions in question are progressively
effected in relation to Shares already on issue.

 

11.          Participation in other
opportunities

 

If, during the Life of each
Option, securities of any other corporation are offered or otherwise made
available to the Bank’s shareholders generally, the Bank will use its best
endeavours to ensure that the Officer is given an opportunity to participate on
the same basis as if he had actually held the Shares then the subject of that
Option.

 

12.          Consultation on
reconstruction, alterations etc.

 

12.1                           If any reconstruction or alteration occurs in
relation to Shares or the Bank’s share capital or other securities of the Bank
which, in the reasonable opinion of the Bank or the Officer:

 

(i)                                     affects or is likely to affect the position
of holders of Shares in a way not contemplated by this agreement; and

 

(ii)                                  produces or may produce in relation to an
Option (whether or not then granted) results which are inequitable to the Bank
or the Officer:

 

the Bank and the Officer
will, if one of them so requests, consult together in good faith with a view to
determining whether an alteration should be made to this agreement or the terms
of any Option (whether or not then granted) or both in order to remedy or
forestall the results considered inequitable.

 

12.2                           If consultation under clause 12.1 produces
agreement that some alteration should be made to this agreement or the terms of
any Option or both, that alteration will be made but if consultation fails to
produce such agreement within two months, the Bank or the Officer may require
that the matter be submitted for determination under the following provisions
of this clause.

 

12.3                           Each of the Bank and the Officer shall within
14 days after the request being made for determination of a matter appoint an
expert and request that the matter be determined by agreement between the
expert appointed by the Bank and the expert appointed by the Officer after
receiving any submissions which the Bank and the Officer might wish to make.

 

12.4                           If the experts are not able to reach
agreement within a period of one month after their appointment, either the Bank
or the Officer may request that the matter be determined by a third expert to
be selected by the experts appointed by each of the Bank and the Officer and
may request that the third expert make a decision on the matter as soon as
practicable after receiving any submissions which the Bank and the Officer
might wish to make but if the experts appointed by the Bank and the Officer are
not able to agree upon the choice of a third expert within seven days after
being requested to do so, the third expert shall be appointed by the President
for the time being of the Securities Institute of Australia.

 

12

 

12.5                           The decision of any expert or experts made
pursuant to this clause is, in the absence of manifest error, to be conclusive
and binding on the Bank and the Officer.

 

12.6                           Each party shall bear the costs of an expert
appointed by that party under clause 12.3 and the Bank and the Officer shall
each pay one half of the costs and expenses of any third expert appointed in
making any such determination.

 

12.7                           The expert or experts will be appointed as
experts and not as arbitrators and the procedures for determination of a matter
referred to the experts are to be decided by the experts in their absolute
discretion.

 

13.                               General
provisions

 

13.1                           The Bank must ensure that sufficient of the
Shares which have been created but have not been allotted remain available
during the Life of each Option to accommodate exercise of that Option in
respect of the whole number of Shares the subject of that Option.

 

13.2                           Every report and other document sent by the
Bank to its shareholders generally must, during the Life of any Option, be sent
also to the Officer.

 

13.3                           Whenever the number of Shares the subject of
an Option or the Exercise Price applicable to each such Share is adjusted
pursuant to this agreement, the Bank must give notice of the adjustment to the
Officer.

 

13.4                           Any notice to be given by the Bank to the
Officer shall be taken to have been given if served personally on the Officer
or left at his last known place of residence.

 

13.5                           By entering in this agreement, the Officer
agrees that, except for any existing entitlements under Current Plans, he is
not in the absence of shareholder approval entitled to accept Shares or options
for Shares or an offer for Shares or options for Shares under the Current
Plans.

 

13.6                           Any Shares allotted by virtue of the exercise
of an Option shall rank equally with all other existing Shares from the date of
allotment.

 

13.7                           The Officer irrevocably and unconditionally
acknowledges and agrees, in the event the Bank breaches this Agreement in any
way, that in relation to any breach:

 

(a)                                  money damages are the sole and exclusive
remedy available to the Officer;

 

(b)                                 compensation by payment of money damages
constitutes a full and adequate remedy; and

 

(c)                                  all other remedies which may (but for this
clause) be otherwise available to the Officer, whether by statute, at law or in
equity are expressly waived by the Officer in consideration of the Bank
entering into this Agreement.

 

13.8                           The terms of this agreement shall be governed
by and construed in accordance with the laws for the time being in force in the
State of New South Wales.

 

13

 

	
  EXECUTED as an agreement.

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED for and behalf of
  WESTPAC

  	
  )

  	
   

  	
  WESTPAC BANKING
  CORPORATION by

  
	
  BANKING CORPORATION by

  	
  )

  	
   

  	
  its attorneys who hereby
  respectively state that at

  
	
  lIana R Atlas and Garry
  Tierney its duly

  	
  )

  	
   

  	
  the time of executing this
  agreement they have no

  
	
  constituted attorneys in the
  presence of:

  	
  )

  	
   

  	
  notice of the revocation
  of the Power of Attorney

  
	
   

  	
   

  	
   

  	
  registered in the Office
  of the Registrar General

  
	
   

  	
   

  	
   

  	
  numbered 427 Book 3847
  under the authority of

  
	
   

  	
   

  	
   

  	
  which they have executed
  this agreement

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ R. A. Holt

  	
   

  	
   

  	
  /s/ Ilana Atlas

  	
   

  
	
  Witness

  	
   

  	
   

  	
  Group Secretary and
  General Counsel

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ R. A. Holt

  	
   

  	
   

  	
  /s/ Garry Tierney

  	
   

  
	
  Witness

  	
   

  	
   

  	
  Acting Chief Legal Officer

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SIGNED by DAVID RAYMOND
  MORGAN

  	
   

  	
   

  	
   

  
	
  in the presence of:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ ILANA ATLAS

  	
   

  	
   

  	
  /s/ David Raymond Morgan

  
	
  Signature of witness

  	
   

  	
   

  	
  Dr. David Raymond Morgan

  
	
   

  	
   

  	
   

  	
   

  
	
  ILANA ATLAS

  	
   

  	
   

  	
   

  
	
  Name of witness (block
  letters)

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  27/60 MARTIN PLACE, SYDNEY

  	
   

  	
   

  	
   

  
	
  Address of witness

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  SOLICITOR

  	
   

  	
   

  	
   

  
	
  Occupation of witness

  	
   

  	
   

  	
   

  

 

 

CHIEF EXECUTIVE SHARE OPTION

AMENDMENT AGREEMENT

 

Date:                                                                   19 December 2001

 

Parties:                                                    WESTPAC BANKING CORPORATION ABN 33 007 457 141
of 60 Martin Place, Sydney (“Bank”)

 

DAVID RAYMOND MORGAN
Managing Director and Chief Executive Officer of the Bank (‘Officer’)

 

Recitals:

 

A.                                   On 2 September 1999, at a Special General
Meeting of the Bank, shareholders approved the grant to the Officer of certain
options over unissued ordinary shares of the Bank in accordance with the terms
of an agreement headed “Chief Executive Share Option Agreement”, a copy of
which accompanied the notice convening that meeting;

 

B.                                     On 26 October 1999, the Officer and the Bank
entered into the agreement referred to in Recital A (the “Original Agreement”)
and the options were granted by the Bank to the Officer pursuant to, and on the
terms and conditions contained in, the Original Agreement;

 

C.                                     At the Bank’s Annual General Meeting held on
13 December 2001, shareholders of the Bank approved certain amendments to the
Original Agreement, the details of which were set out in the notice convening
that meeting; and

 

D.                                    The Bank and the Officer have agreed to enter
into this agreement in order to give effect to the amendments referred to in
Recital C.

 

Operative provisions:

 

1.                                       Interpretation

 

1.1                                 In this agreement, unless the context or
subject matter otherwise indicates or requires, words and expressions defined
in the Original Agreement shall have the same meanings when used in this
agreement.

 

1.2                                 Headings in this agreement are for
convenience only and do not affect its interpretation.

 

2.                                       Amendment to Original Agreement

 

2.1                                 With effect from the date of this agreement,
the Original Agreement shall be amended as follows:

 

(a)                                  the existing clause 5.5.2 shall be deleted;
and

 

(b)                                 a new clause 5.5.2 shall be inserted, to read
as follows:

 

1

 

5.5.2                        Other than as contemplated in clause 5.2.2,
if the Officer ceases to be an employee of the Bank in an executive position on
or after the First Exercise Date in respect of an Option:

 

(a)                                  as a consequence of the death or total and permanent
disablement of the Officer - the Exercise Period shall end on the earlier of
the End Date and the day which is 12 months after the Officer’s employment
ceases;

 

(b)                                 as a consequence of the Officer’s retirement
on or after March 2004 - the Exercise Period ends on the End Date;

 

(c)                                  as a consequence of the Officer’s resignation
on or after 1 March 2004 - the Exercise Period ends on the earlier of:

 

(i)                                     the End Date; and

 

(ii)                                  the day which is 3 months after the Officer’s
employment ceases or such later (being not later than the End Date) as the
Board may determine in its absolute discretion; and

 

(d)                                 in any other case - the Exercise Period ends
on the earlier of the End Date and the day which is 3 months after the
Officer’s employment ceases.

 

2.2                                 In
all other respects, the Original Agreement is ratified and confirmed.

 

3.                                       General provisions

 

13.1                           The
terms of this agreement shall be governed by and construed in accordance with
the laws for the time being in force in
the State of New South Wales.

 

EXECUTED as an agreement.

 

	
  SIGNED for and on behalf
  of WESTPAC

  BANKING CORPORATION by

  Ilana R Atlas and Garry Tierney its duly

  Constituted attorneys in the presence of:

  	
  )

  )

  )

  )

  	
  WESTPAC BANKING
  CORPORATION

  by its attorneys who hereby respectively state

  that at the time of executing this agreement they

  have no notice of the revocation of the Power of

  Attorney registered in the Office of the Registrar

  General numbered 427 Book 3847 under the

  authority of which they have executed this agreement

  
	
   

  	
   

  	
   

  
	
  /s/ R. A. Holt

  	
   

  	
  /s/ R. A. Holt

  	
   

  	
  /s/ Ilana Atlas

  
	
  Witness

  	
   

  	
  Title: Group Secretary and
  General Counsel

  
	
   

  	
   

  	
   

  
	
  /s/ R. A. Holt

  	
   

  	
  /s/ R. A. Holt

  	
   

  	
  /s/ Garry Tierney

  
	
  Witness

  	
   

  	
  Title: Acting Chief Legal
  Officer

  

 

2

 

	
  SIGNED by DAVID RAYMOND
  MORGAN

  	
   

  	
   

  	
   

  	
   

  
	
  the presence of:

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Ilana Atlas

  	
   

  	
  /s/ David Raymond Morgan

  	
   

  	
   

  
	
  Signature of witness

  	
   

  	
  Dr. David Raymond Morgan

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ILANA ATLAS

  	
   

  	
   

  
	
  Name of witness (block
  letters)

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  27/60 MARTIN PLACE, SYDNEY

  	
   

  	
   

  
	
  Address of witness

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  SOLICITOR

  	
   

  	
   

  
	
  Occupation of witness

  	
   

  	
   

  

 

3

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