Document:

Exhibit 4.4

 

CUSTODY AGREEMENT

SHARESAVE
PLANS

 

THIS AGREEMENT has been
made as of May 1, 2006, between Imperial Tobacco Group PLC, a public
limited company organized under the laws of England and Wales with its
principal place of business at Upton Road, Bristol
BS99 7UJ, England (“Company”) acting as agent for certain of its
employees, and the HSBC Bank USA, National Association, a national banking
organization with a principal place of business at One HSBC Center, Buffalo,
New York 14203 (“Custodian”).

 

RECITALS

 

WHEREAS, the Company
acting as agent for certain of its employees who have directed the Company to
act as their agent for that purpose the (“Agent”), desires to establish a
custody account (“Account”) for the purpose of holding the savings contributions
of those employees as individual participants in the Imperial Tobacco Group International Sharesave Plan; and

 

WHEREAS, the Agent wishes
to appoint the Custodian to hold the savings contributions, and the Custodian
is willing to accept such appointment subject to the terms and conditions
herein set forth;

 

NOW, THEREFORE, the Agent
and the Custodian agree as follows:

 

1.  Appointment and Duties of Custodian.  The Agent hereby appoints the Custodian to
hold and pay amounts from assets held from time to time in the Account. The
Custodian accepts such appointment and agrees that it will have custody and be
responsible for the safekeeping of assets comprising the Account. The Custodian
may register any assets of the Account in the name of its nominee and may use
the depository facilities of the Federal Reserve Bank, or the Depository Trust
Company, or may make any other reasonable depository arrangement.

 

2.  Assets of Account.  The assets shall consist initially of such
cash as the Agent delivers to the Custodian and shall be subject subsequently
to such additions and/or withdrawals as the Agent shall from time to time
direct.

 

3.  General Investment Operations.  The Custodian will invest the assets of the
Account in the HSBC Investor U.S. Treasury Money Market Fund managed by HSBC
Asset Management Americas, Inc.

 

4.  Collection of Income.  The Custodian will collect income paid with
respect to assets of the Account and will add it to the assets at month end.

 

5.  Payments of Benefits and Expenses.  The Custodian shall make payments and pay
expenses and other amounts only when it receives (and in accordance with)
written instructions of the Agent indicating the amount of payment and the name
and address of the recipient. The Custodian shall not be liable to make such
payments unless sufficient funds are available in the Account. The Custodian
need not inquire into whether any payment it is so instructed to make is
consistent with applicable law or otherwise proper. The Custodian shall not be
liable in any way for any payment made by the Custodian in accordance with such
instructions.

 

1

 

The Custodian may pay any
amount by mailing its check for the amount thereof to the person designated by
the Agent as entitled to receive such payment to such address as may have last
been furnished to the Custodian by the Agent. If no such address has been so
furnished, amounts may be mailed by the Custodian to such person in care of the
Agent.

 

If a dispute arises as to
the payment of any funds or delivery of any assets by the Custodian, the
Custodian may withhold such payment or delivery until the dispute is determined
by a court of competent jurisdiction, is finally settled in writing by the
parties concerned, or until it is indemnified against loss to its satisfaction.

 

6.  Transaction Statements and Recordkeeping.
 The Custodian will supply the Agent with
periodic statements showing transactions involving the Account, including
receipts, disbursements, purchases, sales and the market value of the assets. The
Custodian will provide periodic balance sheets or summaries of income and
expenses and will maintain accounts showing the interests of individuals in the
Account.

 

7.  Assumptions of Custodian.  The Custodian may assume, and shall be fully
protected in assuming, that any communication received by it under this
Agreement is from the party purporting to have sent it and is genuine in all
respects, and does not violate any law or administrative rule or regulation.

 

8.  Fees and Expenses of Custodian.  The compensation to which the Custodian is
entitled shall be evidenced by the attached fee schedule, dated and signed,
which becomes a part of this Agreement. The Custodian shall provide written
notification to the Agent of any change in the fee schedule and the effective
date of said change. The schedule, as amended, shall become effective unless
the Custodian receives the written objection of the Agent within 30 days of the
notification.

 

9.  Taxes.  All taxes that may be levied or assessed upon
or in respect of the Account shall be paid from the Account. The Custodian
shall notify the Agent of any proposed or final assessments of taxes and may
assume that any such taxes are lawfully levied or assessed unless the Agent
advises it in writing to the contrary within fifteen days after receiving the
above notice from the Custodian. If the Agent contests the validity of any such
taxes, it shall so notify the Custodian and the Custodian shall make no
payments respecting such tax unless instructed to do so by the Agent or
compelled to do so by governmental authority. If the Agent contests any such
proposed levy or assessment, the Custodian shall provide such information and
cooperation as the Agent reasonably requests. The Custodian shall have no
responsibility or liability for any obligations now or hereafter imposed on the
Agent, the Account or the Custodian as custodian of the Account by the tax law
of the United States of America or any state or political subdivision thereof. It
shall be the responsibility of the Agent to notify the Custodian of the
obligations imposed on the Agent, the Account or the Custodian as custodian of
the Account by the tax law of jurisdictions other than those mentioned in the
above sentence, including responsibility for withholding and other taxes,
assessments or other governmental charges, certifications and governmental
reporting.

 

10.  Retention of Advisors.  The Custodian may reasonably consult legal
counsel and other professional advisors who may, but need not, be its counsel
or advisor or counsel or advisor to any party having an interest in or
connected with the Account or the Agent, with respect to the meaning and
construction of this Agreement or its power, obligations, and conduct hereunder.
The Custodian shall be entitled to reasonable reimbursement for such legal
counsel’s and other professional advisor’s fees. The Custodian shall not be
liable for the consequences of, and shall be fully protected in acting pursuant
to or relying upon, the advice of such legal counsel or advisors.

 

11.  Liability and Immunities of Custodian.  The Custodian shall be fully protected in
relying upon any written instruction, direction or approval of the Agent.

 

2

 

The Custodian shall be
fully protected in acting upon any instrument, certificate, or paper believed
by it to be genuine and to be signed or presented by the proper person or
persons, and may accept the same as conclusive evidence of the truth and
accuracy of the statements therein contained.

 

All persons dealing with
the Custodian are released from inquiry into the decision or authority of the
Custodian.

 

Except as specifically
provided elsewhere in this Agreement, neither the Custodian nor any of its
officers, directors, or employees, nor any agent of or counsel for any of the
foregoing, shall be liable to anyone at any time interested in the Account, for
any act or omission in the administration of this Agreement.

 

The Custodian shall not
be liable to make payments of any kind unless sufficient funds are available
therefor in the Account. The Custodian shall be responsible only for such money
and other property as are received by it as Custodian under this Agreement.

 

12.  Tax Representations.  The Custodian makes no representations to any
party to this Agreement or any other person as to the tax consequences of any
transactions involving the assets in the Account.

 

13.  Proof of Matters.  Whenever the Custodian shall deem it desirable
for a matter to be proved or established before taking, permitting, or omitting
any act, the matter (unless other evidence in respect thereof is specifically
prescribed in this Agreement) may be deemed to be conclusively established by a
certification signed by the Agent and delivered to the Custodian, and the
Custodian shall be fully protected in relying on such an instrument.

 

14.  Resignation or Removal of Custodian.  The Custodian may resign as Custodian under
this Agreement at any time by a written instrument delivered to the Agent giving
notice of such resignation, which shall be effective sixty days after receipt
or at such other time as is agreed by the Agent and the Custodian. The
Custodian may be removed at any time by the Agent by a written resolution
delivered to the Custodian, which shall be effective thirty days after receipt
or at such other time as is agreed between the Agent and the Custodian.

 

If the Custodian resigns
or is removed, it shall deliver any assets of the Account in its possession to
a successor custodian or the Agent as soon as is reasonably practicable after
such resignation or removal or at such earlier time as shall be agreed on by
the Agent and the Custodian.

 

The Custodian may,
however, reserve such sum of money as it deems advisable for payment of its
fees and expenses in connection with its administration of the Account or for
payment of all taxes that have been or the Custodian reasonably believes will
be assessed on or in respect of the Account or the income thereof for the
period before its removal or resignation. The Custodian shall pay over to the
successor custodian or the Agent any balance of such reserve remaining after
the payment of such fees, expenses and taxes. The delivery of assets of the
Account to the successor custodian or the Agent shall not be deemed a waiver by
the Custodian of any lien or claim it may have on the Account for its fees or
expenses.

 

15.  Communications.  Communications to the Custodian shall be sent
to its Trust Division at HSBC Bank USA, National Association, One HSBC Center,
Buffalo, New York 14203.

 

16.  Indemnification.  In the event a claim is asserted by any person
or persons against the Custodian where the Custodian has acted in good faith in
reliance on directions or communications of the Agent or in the event the Custodian
is involved in litigation in connection with any matter arising under this
Agreement, it shall be indemnified by the Agent against any liability imposed
against it as a result thereof or incurred by reason of its holding of the
assets, including legal fees incurred unless such litigation or claim asserted
against the Custodian results in a determination that there has been a breach
by the Custodian of its legal obligations

 

3

 

gross and or willful negligence and or misconduct. The Custodian acting
in good faith shall not be liable for any action, omission, information or
recommendation in connection with this Agreement, except in the case of the
Custodian’s actual misconduct or willful violation of any applicable statue.

 

17.  Applicable Law.  This Agreement shall be construed in
accordance with the laws of the State of New York.

 

18.  Amendment.  This Agreement may be amended at any time and
from time to time by a written instrument signed by the Custodian and the Agent.
The instrument of amendment shall specify its effective date and amendments may
be made effective retroactively.

 

19.  Severability.  Should any provision of this Agreement be
deemed or held invalid or unlawful for any reason, such fact shall not
adversely affect the other provisions of this Agreement unless such invalidity
shall render impossible or impractical the functioning of the Agreement.

 

20.  Counterparts.  This agreement may be executed in one or more
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original and all of which when taken
together shall constitute one and the same agreement.

 

IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed as of the date and
year first above written.

 

	
   

  	
  AS AGENT FOR CERTAIN OF ITS EMPLOYEES

  
	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  ROBERT DYRBUS

  	
   

  
	
   

  	
   

  	
   

  	
    Robert Dyrbus, Director

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CUSTODIAN

  
	
   

  	
   

  	
  HSBC Bank USA, National Association

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ JAMES T BUCCELLA

  	
   

  
	
   

  	
   

  	
   

  	
    James T. Buccella,
  First Vice President

  

 

4Exhibit 10.1
FY06 Performance Share Bonus Incentive Program

Watson
Wyatt Worldwide, Inc.

Performance Share Bonus Incentive Program

FY06

Summary

The Performance Share
Bonus Incentive Program (the Program) is a long-term bonus program for senior
executives, designed to strengthen incentives and align behaviors to grow the
business in a way that is consistent with the strategic goals of the Company. Incentives
are provided through grants of deferred stock units tied to a 3-year
performance period with vesting contingent upon meeting certain Company goal
thresholds. This bonus program does not replace the Fiscal Year End Bonus
(FYEB).

Eligibility

Associates of Watson
Wyatt & Company and its Affiliates will be eligible for nomination to
participate in the Program. Eligible participants will be nominated and
approved by the Compensation Committee of the Board (the Committee). Generally,
associates eligible for nomination will be high performing, senior-level
executives that have direct impact or responsibility for driving strategy
throughout the organization.

Performance Period

The performance period is
a 3-year period that begins on July 1, 20xx and ends on June 30,
20xx+3. For example, the performance period that began on July 1, 2005
will end on June 30, 2008. Baseline metrics are established at the
beginning of the performance period. At the end of the performance period,
performance metrics will then be measured. The Company will follow its standard
process for financial reporting following the close of the fiscal year. Once
Company financial results are finalized (August following end of fiscal
year) the final performance metric results for the most recent performance
period can be determined.

Grants

Grants of stock
(performance shares) are made under the 2001 Deferred Stock Unit Plan for
Selected Employees. Grants are based on the value of the cash portion of
the Fiscal Year End Bonus target. A multiplier, which varies by participation
tier, is then applied to that value to determine the cash value of the performance
shares. The cash value is then converted to a number of shares of stock based
on the stock market closing price on the last day of the fiscal year prior to
the grant. For calculation purposes, band and salary information will be based
on what is in effect as of October 1 of the first fiscal year of the
performance period.

 

 

All performance share
grants will be made by the Committee at the beginning of each performance
period (following the fiscal year end close process). Final grant amounts will
generally be determined by the method outlined here. However, the Committee, at
its discretion, may adjust final grant amounts.

Vesting

The performance shares
will vest 3 years from the date of grant based on the achievement of certain
performance metrics and subject to the participant’s continued employment on
the vesting date unless waived in accordance with the Termination Provisions
herein. Company performance goals are established by the Committee at the
beginning of each performance period. At the conclusion of each performance
period, Company performance metrics are measured against goals over the same
period to determine the percentage of the grant to be awarded. The actual award
is determined by an earnout schedule which defines performance level ranges and
associated earnout of grants. Vested shares are distributed to participants in September following
the end of the performance period and the fiscal year end close.

Performance Metrics and
Earnout

The earnout for each
performance period is determined by evaluating actual Company performance,
using pre-defined metrics, for the full 3year performance period. Baselines for
each metric will be established at the beginning of each performance period by
the Committee. The baseline will be determined by recording the metric as of
the last day of the prior fiscal year (6/30).

For grants under the
Program covering 2006-2008, two types of financial metrics will be used:

1.  Earnings Per
Share (“EPS”) Growth; and

2.   Revenue Growth.

 

 

Earnout
Schedule

An earnout schedule using
total growth over the 3-year performance period for E.P.S and Revenue is
shown below:

	
  E.P.S. Growth

  	
   

  	
  30

  	
  %

  	
  100

  	
  %

  	
  135

  	
  %

  	
  170

  	
  %

  
	
   

  	
  20

  	
  %

  	
  65

  	
  %

  	
  100

  	
  %

  	
  135

  	
  %

  
	
   

  	
  10

  	
  %

  	
  30

  	
  %

  	
  65

  	
  %

  	
  100

  	
  %

  
	
   

  	
   

  	
   

  	
   

  	
  10

  	
  %

  	
  12.5

  	
  %

  	
  20

  	
  %

  
	
   

  	
   

  	
  Revenue
  Growth

  	
   

  

 

Performance Metrics for Performance
period 7/1/2005 — 6/30/2008

Earnings Per Share
(E.P.S.) Growth — E.P.S. for the fiscal year before the start of the
performance period compared to E.P.S. of the 3rd year of the performance period, expressed as a
percentage. E.P.S. is defined as fully
diluted earnings per share from continuing operations. The E.P.S. to be used
for the fiscal year before the start of the performance period is $1.65 which
reflects fiscal 2005 full diluted earnings per share from continuing operations
adjusted for the $0.09 loss related to the foreign currency hedge contract.

Revenue Growth — Revenue
growth is defined as the percentage change in revenue from the fiscal year
prior to the performance period of the plan to the third year of the
performance period.

Revenue will be defined
as the amount stated in the Form 10-K.

In performance periods
where acquisitions occur:

Revenue at the start of the performance period (as
published in the Form 10-K) will be increased by the revenue
generated by the acquired company during the annual period preceding the
acquisition. In the event an
acquisition occurs after the first day of the performance period, the
acquisition revenue from the year preceding the acquisition will be discounted,
using Watson Wyatt’s revenue growth rate, from the year preceding the
acquisition to the beginning of the performance period. In addition, the
revenue to be counted for the acquired company in the year of acquisition will
be adjusted to be representative of a full year’s revenue. Acquisition
revenue used will be as reported in the acquired company’s published financial
reports (Form 10-K). In the event such financial reports are
unavailable, revenue generated by the acquired company will be provided by the
investment bankers familiar with the acquired company.

 

 

Termination Provisions

Performance shares
granted to a participant whose employment terminates prior to the scheduled
vesting date on account of the participant’s death, or permanent disability
(permanent disability to be determined pursuant to the terms of the Company’s
tax-qualified pension plan) shall vest as if the participant remained employed
through the scheduled vesting date. Performance shares granted to a participant
whose employment terminates prior to the scheduled vesting date on account of
retirement (determined pursuant to the terms of the Company’s qualified pension
plan) shall vest as the Committee may determine, in its sole discretion and on
a case-by-case basis. Performance shares granted to a participant whose
employment terminates for reasons other than death, permanent disability or
retirement will not vest and shall be forfeited; provided, however, that the
Committee may determine, in its sole discretion and on a case-by-case basis, to
permit some or all of such participant’s performance shares to vest.

Change in Control or
Capitalization 

A change in control or
capitalization (merger, consolidation, reorganization, stock split,
acquisition, etc.) may affect the value of performance shares granted, earnout
of vested performance shares or other provisions of the Program. To assure fair
and equitable treatment of participants in the event of such a change in
control or capitalization, the Committee, at its discretion, may make changes
to grants and/or vesting that is consistent with the Change in Control and
Change in Capitalization provisions described in the 2001 Deferred Stock
Unit Plan for Selected Employees. Under these circumstances, the Committee
may make appropriate adjustments to the number of performance shares granted
for any performance period, accelerate the vesting of any performance shares
granted, or provide for payment in cash in lieu of shares.

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