Document:

EXHIBIT 10.1

REPUBLIC BANK
& TRUST COMPANY

CORPORATE CENTER LEASE

601 W. MARKET STREET

LOUISVILLE, KENTUCKY

10-1-06

INDEX TO LEASE

	
  Article

  	
   

  	
   

  	
   

  
	
  I.

  	
   

  	
  Premises

  	
   

  
	
  II.

  	
   

  	
  Term/Option To Renew

  	
   

  
	
  III.

  	
   

  	
  Rent

  	
   

  
	
  IV.

  	
   

  	
  Use

  	
   

  
	
  V.

  	
   

  	
  Possession

  	
   

  
	
  VI.

  	
   

  	
  Services to be Provided

  	
   

  
	
  VII.

  	
   

  	
  Maintenance and Repair; Alterations

  	
   

  
	
  VIII.

  	
   

  	
  Access

  	
   

  
	
  IX.

  	
   

  	
  Damage or Destruction

  	
   

  
	
  X.

  	
   

  	
  Indemnity

  	
   

  
	
  XI.

  	
   

  	
  Insolvency,
  Etc.

  	
   

  
	
  XII.

  	
   

  	
  Remedies

  	
   

  
	
  XIII.

  	
   

  	
  Insurance

  	
   

  
	
  XIV.

  	
   

  	
  Liens

  	
   

  
	
  XV.

  	
   

  	
  Assignment; Subletting; Mortgaging

  	
   

  
	
  XVI.

  	
   

  	
  Estoppel Certificate

  	
   

  
	
  XVII.

  	
   

  	
  Taxes

  	
   

  

 

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  XVIII.

  	
   

  	
  Priority of Lease

  	
   

  
	
  XIX.

  	
   

  	
  Fixtures and Personal Property; Surrender

  	
   

  
	
  XX.

  	
   

  	
  Hold
  Over Tenancy

  	
   

  
	
  XXI.

  	
   

  	
  Waiver of Subrogation

  	
   

  
	
  XXII.

  	
   

  	
  Notices

  	
   

  
	
  XXIII.

  	
   

  	
  Rights Reserved by Landlord

  	
   

  
	
  XXIV.

  	
   

  	
  Condemnation

  	
   

  
	
  XXV.

  	
   

  	
  Miscellaneous Provisions

  	
   

  

 

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AMENDED AND
RESTATED OFFICE LEASE

THIS LEASE, dated
effective this first day of October, 2006, is between TEECO Properties,
hereinafter referred to as “Landlord” and Republic Bank & Trust Company,
hereinafter referred to as “Tenant”.  As
parties hereto, Landlord and Tenant agree:

ARTICLE I.  PREMISES

SECTION
1.   Tenant
leases from Landlord and Landlord leases to Tenant the following described
premises (hereinafter called the “Premises”):

Being approximately 48,900 square feet of rentable
office space located on the 1st, 2nd, 3rd, 5th, and 6th floors of the Republic
Corporate Center (hereinafter called the “Building”) located at the corner of
Sixth and Market Streets in Jefferson County, Kentucky.

SECTION
2.   The
Premises shall be provided in “as is” condition.  Upon occupancy of the Premises, Tenant
acknowledges they have examined the Premises, know the condition of the
Premises, and accept the Premises in the condition as then existing.  Any remodeling, construction and/or
redecorating within the Premises shall be performed to the complete and
absolute satisfaction of Landlord.  The
Landlord’s approval shall be obtained by Tenant prior to commencement of any
and all improvements and the construction of improvements shall be supervised
and approved by Landlord on a continuous basis.

SECTION
3.   This
lease confers no rights with respect to the Building other than tenancy of the
Premises and the non-exclusive license to use, during such tenancy, the
following facilities provided by Landlord: (i) toilet facilities on the floor
which the Premises are located (and such other toilet facilities located
elsewhere in the Building as may be designated by Landlord for the general use
of tenants); (ii) the public entrances to, and main floor lobby in, the
Building; and (iii) the passenger elevators serving the Building.

ARTICLE II.  TERM/OPTION TO RENEW

Landlord leases the Premises to Tenant and Tenant
hires and takes the Premises from Landlord, for a term of five (5) Lease Years
commencing on the first day of October, 2006 (the “Lease Commencement Date”)
and expiring at midnight on the last day of the 60th month thereafter unless sooner terminated
pursuant to the terms hereof.  “Lease
Year” shall mean a year period beginning on the first day of a month, which is
the first calendar month of the term of the Lease and ending on the day before
the anniversary of the first day of such year.

Tenant shall have two five-year options to renew this
lease for an additional five-year period for each option term at a rent
adjustment proportionate with the increase in the Consumer Price Index, all
urban consumers over each year of the preceding term.  Tenant shall notify Landlord of Tenant’s
intent to exercise such option within 90 days of the expiration of the original
term of this lease.

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ARTICLE III.  RENT

SECTION
1.   Tenant
shall pay to Landlord at Landlord’s office in the Building or at such place as
Landlord may from time to time designate, as rental for the Premises, the sum of
Eighty Thousand Dollars and no cents ($80,000.00) per month (the “Rent”).  Rent shall be payable in advance on the first
day of each calendar month during each Lease Years.

SECTION
2.   In the
event that the Rent or any other sum payable by Tenant to Landlord under this
lease shall not be received (paid) within ten (10) days of the due date
thereof, Landlord may, at its option, add a monthly service charge at a rate
which shall be the greater of $25.00 or 1% for each month or fraction thereof
from such Rent due date during which such Rent or other sum remains
unpaid.  Further, in the event that any
check which has been remitted to Landlord by Tenant for payment of the Rent or
any other sum payable under this Lease shall not be honored upon its
presentation for payment, then the monthly service charge shall be similarly
imposed on said amount from the due date until paid.  Acceptance by the Landlord for such service
charge shall not be deemed to be a waiver by Landlord of any default nor shall
it restrict the remedies otherwise available to Landlord hereunder.

ARTICLE IV.  USE

The Premises are to be
used only for the purpose of conducting therein the operation of banking
business and any and all related services and for no other business or purpose
without the prior written consent of Landlord. 
Tenant shall not do or permit to be done in or about the Premises
anything which is illegal or unlawful; or which is of a hazardous or dangerous
nature; or which will increase the rate(s) of insurance upon the Building.  Tenant shall (and shall cause its employees
to) observe the rules and regulations set forth in Exhibit A
attached hereto and made a part hereof, as the same may be amended by Landlord from
time to time, and Tenant shall comply with all governmental laws and ordinances
and all regulations applicable to the use and occupancy of the Building.

ARTICLE V.  POSSESSION

If Landlord permits
Tenant to enter into possession of the Premises prior to the Lease Commencement
Date, all of the terms and conditions of this Lease shall apply during such
prior period.  Tenant’s taking of
possession of the Premises constitutes Tenant’s certification that the premises
are in good and tenantable condition and acceptable for Tenant’s use thereof as
provided in this Lease.

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ARTICLE VI.  SERVICES TO BE PROVIDED

Landlord shall furnish
reasonable amounts of heat, air conditioning, water, elevator service and
janitor service (collectively “Services”) to the Premises, all such services
being subject to energy availability or Energy Consumption Regulations which
may be hereafter promulgated. All services at any other times and all special
equipment which may be required for such services and all above normal service
and special equipment which may be requested for such service during normal
business hours or otherwise should be furnished only upon the request of and at
the sole cost of lessee.  It is expressly
agreed that should any local, state or federal governmental body, agency or
public utility restrict or reduce the amount of fuel or energy which may be
utilized to provide the utilities and services as specified above, then such
restriction or reduction, and the reduction in utilities and services which may
result therefrom, shall in no way create or constitute a default on the part of
the Landlord, and there shall be no reduction or abatement in the Rent or any
other sum payable by Tenant thereunder. 
Further, Landlord shall not be liable for any injury, damage, inconvenience,
or otherwise which may arise or result should the furnishing of any such
services by interrupted or prevented by fire, accident, strike, riot, act of
God, the making of necessary repairs or improvements, or any other cause beyond
the reasonable control or prevention of Landlord, nor, subject only to the
provisions of Article IX of this Lease, shall the Rent payable by Tenant
hereunder abate.

ARTICLE VII.  MAINTENANCE AND REPAIR; ALTERATIONS

SECTION
1.  Landlord shall keep
and maintain the roof, foundations, floor slab, and all structural walls
(including windows and plate glass), gutters and downspouts of the Premises in
good order and repair.  Landlord shall
keep or cause to be kept in good repair all common areas of the Building and
appurtenant areas, including lighting systems; drainage systems; mechanical,
plumbing, and electrical systems; heat and air conditioning units; duct work,
lines, pipes, and conduits serving the Premises; and parking areas and
driveways.  Any maintenance, repairs or replacements
to any of the foregoing made necessary by any acts or omissions of the Tenants,
its agents or employees shall be paid for by Tenant and Tenant shall reimburse
Landlord on demand for the cost of repairing any damage to the Premises or the
Building caused by Tenant or its agents or employees.  In the event, after reasonable notice to
Landlord, Landlord fails to make any repairs as hereinbefore provided, then
Tenant shall have the right to make these repairs and deduct the cost thereof
from any future rental payments.

SECTION
2.  All maintenance,
repairs, or replacements relating to the Premises that are not the obligation
of Landlord as set forth in Section 1 above shall be the obligation of Tenant
and shall be made by Tenant at Tenant’s sole cost and expense. Tenant shall
maintain, at its expense, the interior of the Premises in good repair and in a
clean and attractive condition. Tenant’s obligation to maintain, repair and
replace includes, but is not limited to, all the interior of the Premises.  In the event Tenant fails to comply with the
requirements of this Section, Landlord may effect such maintenance and repair
and the cost thereof, with interest at the rate of 8.5% per annum, shall be
payable immediately to Landlord as additional rent. In the event the applicable
Statute of the Commonwealth of Kentucky at any time shall allow for a higher
rate of interest under an instrument in writing, then such higher rate shall
apply and be payable. If Tenant is a corporation, then the interest rate to be
so payable hereunder shall be at the rate of 12% per annum.

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SECTION
3.  Tenant shall not
make any alterations, additions or improvements to the Premises without first
obtaining Landlord’s prior written consent. 
In connection with any such request for Landlord’s consent to such
alterations, additions or improvements to the Premises, Landlord may retain the
services of an architect and/or engineer; and the reasonable costs for the
services of such architect and/or engineer shall be reimbursed to Landlord by
Tenant.  Landlord may make any repairs
for the preservation, safety or improvement of the Premises or the
Building.  All alterations, and
improvements made by Tenant shall become the property of Landlord upon making
thereof and shall be surrendered to Landlord upon the expiration of this Lease.

ARTICLE VIII.  ACCESS

Landlord and its agents
shall have the right to enter into and upon the Premises at all reasonable
times with reasonable notice for the purpose of inspecting, cleaning,
repairing, altering or improving the Premises or the Building with the
exception of an emergency situation. Landlord shall have the right to show the
Premises to prospective tenants during the ninety (90) day period prior to the
expiration of the terms of this Lease and shall have the right at all
reasonable times to show the Premises to prospective purchasers of and lenders
upon the Building.  Any damage or loss
caused to the Premises and/or to the Tenant by any use of or access to the Premises
by Landlord shall be repaired by Landlord at Landlord’s expense.

ARTICLE IX.  DAMAGE OR DESTRUCTION

SECTION
1.  If the Premises is
damaged or destroyed, in whole or in substantial part and Section 2 does not
apply, then Landlord may elect to terminate this Lease as of the date of the
damage or destruction by notice given to Tenant in writing not more than twenty
(20) days following the date of damage or destruction.  If Landlord does not elect to terminate,
Landlord shall, at Landlord’s expense, proceed to restore the property to
substantially the same form, condition and quality as prior to the damage or
destruction.  If Landlord elects to
rebuild and repair, Landlord shall proceed as soon as reasonably possible and
thereafter shall proceed without interruption and be completed within one
hundred-eighty (180) days after notice has been given of Landlord’s intent to
rebuild and repair, except for work stoppages on account of labor disputes and
matters not under the control of the Landlord. 
During such period of repair or restoration, the Rent shall be abated in
the same proportion as the untenantable portion of the Premises bears to the
entire Premises identified in Section 1 of Article I of the Lease.

SECTION
2.  If the Premises is
damaged or destroyed, (i) to the extent that more than fifty percent (50%) of
the Building is damaged or destroyed, or (ii) to the extent that more than
fifty percent (50%) of the Premises is damaged or destroyed, then in such
event, Tenant may elect to terminate this Lease as of the date of the damage or
destruction by notice given to Landlord in writing not more than twenty (20)
days following the date of damage or destruction.

SECTION
3.  Notwithstanding
anything contained in this Article to the contrary, Landlord shall not be
required to repair, replace, restore, or rebuild any property which Tenant
shall be entitled to remove from the Premises under the provisions of this
Lease; it being agreed that Tenant shall bear the entire risk of loss, damage
or destruction of such property while it is in the Building.

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SECTION
4.  If either party
elects to terminate the Lease, Tenant shall be entitled to reimbursement for
any prepaid rent or other amounts paid by Tenant and attributable to the unused
term of the Lease.

ARTICLE X.  INDEMNITY

Tenant shall indemnify
and hold Landlord harmless from all loss, damage, liability or expense
resulting from an injury to or death of any person or any loss of or damage to
any property caused by or resulting from any act or omission of Tenant or any
officer, agent, employee, guest, invitee or visitor of Tenant in or about the
Premises or the Building, but the foregoing provision shall not be construed to
make Tenant responsible for injuries to third parties caused by the negligence
of Landlord or any agent or employee of Landlord.  The Landlord shall remain responsible for any
injury to or death of any person or any loss of or damage to property sustained
by any person whatsoever which may be caused by the Building or any equipment
or appurtenances thereto or thereof being or becoming defective or out of
repair.  Landlord shall be and remain
liable for the negligent acts or omissions of Landlord, its agents and
employees.

ARTICLE XI.  INSOLVENCY, ETC.

If leasehold interest of
Tenant be levied upon under the execution or be attached, or if any voluntary
or involuntary petition or similar pleading under any Act of Congress relating
to bankruptcy shall be filed by or against Tenant or a majority of Tenant’s
shareholders, or if any voluntary proceedings in any court or tribunal shall be
instituted by or against Tenant or the majority of its shareholders to declare
Tenant or the majority of its shareholders insolvent or unable to pay debts of
Tenant or the majority of its shareholders, or if Tenant makes an assignment
for the benefit of creditors, or if a receiver be appointed for any property of
Tenant, or if Tenant shall default in payment of any other debt or obligation
to Landlord, then in such event Landlord may, if Landlord so elects and with or
without notice of such election and with or without any demand whatsoever,
forthwith terminate this Lease upon notice to Tenant, and upon such termination
all rights of Tenant hereunder shall thereupon cease and Tenant shall surrender
possession and vacate the Premises immediately.

ARTICLE XII.  REMEDIES

SECTION
1.  If at any time
Tenant shall (a) fail to remedy any default in the payment of any sum due under
this Lease for ten (10) days after notice; (b) fail to remedy any default with
respect to any other of these provisions, covenants or conditions of this Lease
to be kept or performed by Tenant, within thirty (30) days after notice (or, in
the event the default is of such a nature that it cannot be remedied within
said thirty (30) day period, then such additional time as may be necessary for
Tenant to cure such default, within the thirty (30) day period and thereafter
diligently prosecutes the same to completion); or (c) vacate or abandon the
Premises, or fail to conduct its business therein, for a period of five (5)
consecutive business days, and then fail to reoccupy and reestablish the
conduct of business in the Premises within ten (10) days following the date of
written notice from Landlord of such failure; then Landlord shall have all such
rights and remedies as are provided by 

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law in respect of such default, including at Landlord’s
election, the right to terminate this Lease and all Tenant’s rights hereunder
shall be terminated.

The liability of Tenant
for the Rent, and other payments provided for herein shall not be extinguished
for the balance of this Lease, and Tenant shall make good to Landlord any
deficiency arising from such reletting of the Premises, plus the costs and
expenses of renovating, altering and reletting the Premises, and including
attorneys’ fees or brokers’ fees incident to Landlord’s reentry or
reletting.  Tenant shall pay any such
deficiency each month, as the amount thereof is ascertained by Landlord, or at
Landlord’s option, Landlord may recover, in addition to any other sums, the
amount at the time of judgement by which the unpaid Rent and other payments for
the balance of the term, after judgement, exceeds the amount thereof which
Tenant proves could be reasonably avoided, discounted at the rate of 7%.  In reletting the Premises, Landlord may grant
rent concessions and Tenant shall not be credited therefor.  Nothing herein shall be deemed to affect the
right of Landlord to recover for indemnification under Article X herein arising
prior to the termination of this Lease.

SECTION
2.  Landlord shall in
no event be in default in the performance of any of its obligations in this
Lease contained unless and until Landlord shall have failed to perform such
obligation within thirty (30) days, or such additional time as is reasonably
required to correct any such default after notice by Tenant to Landlord
properly specifying wherein Landlord has failed to perform any such obligation.

ARTICLE XIII.  INSURANCE

SECTION
1.  Tenant covenants
and agrees that from and after the date of delivery of the Premises from
Landlord to Tenant and at all times during possession thereof, Tenant will
procure and maintain in full force and effect, at its sole cost and expense,
the following types of insurance, in the minimum amounts specified below:

A.   Public Liability and Property Damage.  Personal injury liability, bodily injury
liability and property damage insurance in a single limit of not less than One
Million Dollars ($1,000,000), of which insurance shall insure the performance
by Tenant of the indemnity agreement as to liability for injury to or death of
persons and injury or damage to property as provided in Article X hereof.  All of such insurance shall be primary and
noncontributing with any insurance which may be carried by Landlord.  The adequacy of the coverage afforded by said
liability and property damage insurance shall be subject to review by Landlord
from time to time, and Landlord retains the right to increase or decrease said
limits at such times.

B.   Tenant Improvements. 
Insurance covering all of the leasehold improvements (excepting only the
structural components of the Building and demising partitions), Tenant’s trade
fixtures and personal property from time to time in and/or upon the Premises,
in an amount of not less than the full replacement cost thereof without
deduction for depreciation, providing protection against any peril included
within the classification “Fire and Extended Coverage”, together with insurance
against sprinkler damage, vandalism and malicious mischief.  Any policy proceeds shall be used for the
repair or replacement of the property damaged or destroyed unless this Lease
shall cease and terminate under the applicable provisions herein. If the
Premises shall not be repaired or restored following damage or destruction in
accordance with other provisions herein, Landlord shall receive 

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from such insurance proceeds an amount equal to the
replacement cost of Tenant’s leasehold improvements.

C.   Business Interruptions. 
Business interruption insurance with sufficient coverage to provide for
payment of Rent and other fixed costs during any interruption of Tenant’s
business by reason of fire or other similar cause.

SECTION
2.  All policies shall
be for the mutual and joint benefit and protection of Landlord and Tenant, with
Landlord being named as an additional insured. 
Certificates of such policies shall be delivered to Landlord within ten
(10) days after delivery of possession of the Premises to Tenant and thereafter
within thirty (30) days prior to the expiration of the term of each such
policy.  All public liability and
property damage policies shall contain a provision that Landlord, although
named as an insured, shall nevertheless be entitled to recovery under said
policies for any loss occasioned to it, its servants, agents, and employees by
reason of the acts, omissions and/or negligence of Tenant. As often as any such
policy shall expire or terminate, renewal or additional policies shall be
procured and maintained by Tenant in like manner and to like extent.  All policies of insurance must contain a
provision that the company writing said policy will give to Landlord thirty
(30) days’ notice in writing in advance of any cancellation or lapse, or the
effective date of any reduction in the amounts of insurance.  All public liability, property damage and
other casualty policies shall be written as primary policies, not contributing
with and not in excess of coverage which Landlord may carry.  Landlord may from time to time request Tenant
to provide Landlord with a certified copy of all insurance coverage carried by
Tenant.

SECTION
3.  Tenant agrees to
pay to Landlord forthwith upon demand the amount of any increase in premiums
for insurance against loss by fire that may be charged during the term of this
Lease on the amount of insurance maintained in force by Landlord on the
Building, of which the Premises are a part, resulting from Tenant doing any act
in or about said Premises which does so increase the insurance rates, whether
or not Landlord shall have consented to such act on the part of Tenant.  If Tenant installs upon the Premises any
electrical equipment which constitutes an overload on the electrical lines of
the Premises, Tenant shall at its own expense make whatever changes are
necessary to comply with the requirements of the insurance underwriters any
governmental authority having jurisdiction thereover, but nothing herein
contained shall be deemed to constitute Landlord’s consent to such overloading.

ARTICLE XIV.  LIENS

Tenant shall keep the
Premises free and clear of, and shall indemnify Landlord against all mechanics’
liens and other liens on account of work done for or materials, supplies and
equipment furnished to Tenant by persons claiming under it for maintenance,
repairs and alterations.  Tenant shall
reimburse Landlord for all costs and attorneys’ fees incurred by Landlord in
investigating, defending or clearing such lien. 
Lien is to be cleared within thirty (30) days of filing of same unless
Tenant shall have provided security acceptable to Landlord against any loss to
Landlord on account thereof. As a condition to Landlord’s consent pursuant to
Article VII, Landlord may require Tenant to provide Landlord with reasonable
payment and performance bonds of those persons contracted by Tenant to perform
work on or in the Premises that could be the subject of such a lien in order to

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protect the Premises, the Landlord and any mortgagee
from and against liens of mechanics and materialmen performing work in or
providing services and equipment to the Premises.

ARTICLE XV.  ASSIGNMENT; SUBLETTING; MORTGAGING

SECTION
1.  Tenant shall not
voluntarily, involuntarily or by operation of law assign, transfer, mortgage or
otherwise encumber all or any part of Tenant’s interest in this Lease, or
sublet the Premises or any part thereof, without first obtaining in each and every
instance Landlord’s prior written consent. 
Subject to the foregoing, Tenant shall not assign, transfer or sublet
the Premises, or any part thereof, at a rent to Assignee, Transferee or
Sublessee, greater than $19.63 per square foot. 
Any transfer of this Lease by merger, consolidation, or liquidation, or
any change in the ownership of or power to vote the majority of its outstanding
voting stock resulting in a change in ownership of more than 50% of the total
issued and outstanding shares of Tenant shall constitute an assignment for the
purposes of the paragraph.  If consent is
once given by Landlord to any such assignment or subletting, such consent shall
not operate as a waiver of the necessity for obtaining Landlord’s consent to
any subsequent assignment or subletting. 
Any legal costs incurred by Landlord related to such assignment or
subletting shall be paid by Tenant to Landlord upon demand.  Tenant shall provide Landlord with executed
copies of any Assignment, Transfer or Sublease Agreement entered into as
provided herein.

ARTICLE XVI.  ESTOPPEL CERTIFICATE

Tenant shall at any time
and from time to time execute, acknowledge and deliver to Landlord a statement
in writing certifying: (a) that this Lease is unmodified and in full force and
effect (or if there has been any modification hereof that the same is in full
force and effect as modified and stating the nature of the modification or
modifications); (b) that to the best of its knowledge Landlord is not in
default under this Lease (or if any such default exists the specific nature and
extent thereof); and (c) the date to which Rent and other charges have been
paid in advance, if any.

ARTICLE XVII.  TAXES

SECTION
1.  Tenant shall pay
before delinquency any and all taxes and assessments, and license, sales,
business, occupation or other taxes, fees or charges levied, assessed or
imposed upon its business operations in the Premises.

SECTION
2.  Tenant shall pay
before delinquency any and all taxes and assessments levied, assessed or
imposed upon its trade fixtures, leasehold improvements, merchandise and other
personal property in, on, or upon the Premises.

SECTION
3.  In the event any
taxes, fees or charges referred to in the preceding Section 1 and/or Section 2
shall be assessed, levied or imposed upon or in connection with the business or
property of Landlord, such assessment, taxes, fees or charges shall be paid by
Tenant to Landlord promptly upon Landlord’s request for such payment.

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SECTION
4.  Landlord shall pay
before delinquency any and all costs and expenses of every kind and nature for
real estate ad valorem taxes, and/or fees, assessments, charges or payments in
lieu thereof, to the Commonwealth of Kentucky, and/or any political subdivision
thereof, including, without limitation, Jefferson County, and/or any city,
municipality, agency or special district, the Jefferson County School Board;
Louisville Water Company, and/or the Louisville and Jefferson County
Metropolitan Sewer District, whether general or special assessments, including,
but not limited to, sewer rents, rates and charges; drainage fees; water
charges; taxes based upon the receipt of rent; and any other federal, state or
local government charge, general, special, ordinary or extraordinary (but not
including income or franchise taxes or any other taxes imposed upon or measured
by Landlord’s net income or profits, unless the same is imposed in lieu of real
estate taxes), which may now or hereafter be levied or assessed against the
Building or the land on which the Building and appurtenant parking areas and
driveways are located. If at any time during the term of this Lease the method
of taxation then prevailing shall be altered so that any new tax, assessment,
levy, imposition or charge shall be imposed upon Landlord in place or partly in
place of any such taxes and shall be measured by or be based in whole or in
part upon the Building or the rents or other income therefrom, then all such
new taxes, assessments, levies, impositions or charges or part thereof, to the
extent that they are measured or based, shall be included in the definition of
Landlord’s costs and expenses within the meaning of this subparagraph. Tenant
shall only be directly responsible for taxes, if any, on its personal property
and on the value of its special leasehold improvements exclusive of standard
building improvements.

ARTICLE XVIII.  PRIORITY OF LEASE

This Lease shall, unless
Landlord otherwise elects, be subordinate to any and all mortgages and other
security instruments now existing, or which may hereafter be made covering the
Building and/or the real property underlying the same or any portion or
portions thereof, and for the full amount of all advances made or to be made
thereunder (without regard to the time or character of such advances), together
with the interest thereon, and subject to all the terms and provisions thereof
and to any renewals, extensions, modifications and consolidations thereof; and
Tenant covenants within ten (10) days of demand to make, execute, acknowledge
and deliver upon request any and all documents or instruments demanded by
Landlord which are or may be necessary or proper for more fully and certainly
assuring the subordination of this Lease to any such mortgages or other
security instruments, provided, however, that any person or persons purchasing
or otherwise acquiring any interest at any sale and/or other proceedings under
such mortgages or other security instruments may elect to continue this Lease
in full force and effect in the same manner, and with like effect, as if such person
or persons had been named as Landlord herein, and in the event of such
election, this Lease shall continue in full force and effect as aforesaid, and
Tenant hereby shall continue in full force and effect as aforesaid, and Tenant
hereby attorns and agrees to attorn to such person or persons.  Tenant hereby irrevocably appoints Landlord
the attorney-in-fact of Tenant, to execute and deliver any document provided
for herein, for and in the name of Tenant.

ARTICLE XIX.  FIXTURES AND PERSONAL PROPERTY; SURRENDER

SECTION
1.  Upon the
termination of this Lease, Tenant shall surrender to Landlord the Premises
(including, without limitation, all non-moveable leasehold improvements) in
good condition and repair reasonable wear, tear and damage by casualty not caused
by Tenant or its agents or employees excepted. All improvements, additions, and
fixtures made or installed from time to 

 11
 

 

time by Landlord to, in, upon, or about the Premises,
including, but not limited to, all lighting fixtures, shall be the property of
Landlord and upon any such termination, shall be surrendered to Landlord by
Tenant without any injury, damage or disturbance thereto or payment thereof.

SECTION
2.  All fixtures,
furniture, movable partitions, machinery, equipment and other personal property
installed or placed in said Premises at the cost of or by Tenant shall at all
times remain, be considered and treated as the personal property of Tenant and
in no sense part of the real estate, and Tenant shall have the right at any
time during the term of this Lease and any extension thereof, or within a
period of ten (10) days after any termination hereof to remove the same or any
part thereof from said Premises, provided, however, that upon the removal of
any such personal property, Tenant agrees to restore the area from which the
same has been removed to substantially the same condition as it was prior to
the installation thereof and to the extent necessary to keep Premises in a
leasable and usable condition for future tenants. If Tenant fails to remove any
such personal property, Landlord may at Landlord’s option retain all or any of
such property and title thereto shall thereupon vest in Landlord, Landlord may
remove from the Premises and dispose of in any manner all or any of such
property, in which latter event Tenant shall, upon demand, pay to Landlord the
actual expense of such removal and disposition, and the cost of repair of any
and all damage to the Premises resulting from or caused by such removal.

ARTICLE XX.  HOLD OVER TENANCY

If Tenant shall, without
execution of a new Lease or written extension, and with consent of Landlord,
hold over after the expiration of the terms of this Lease, such tenancy shall
be a month-to-month tenancy, which may be terminated as provided by law.  During such tenancy, Tenant shall pay to
Landlord the greater of (a) the rental rate then being quoted by Landlord for
comparable space in the Building; or (b) 150% the Rent pursuant to Article
III.  During such tenancy, Tenant shall
be bound by all of the terms, covenants, and conditions as herein specified, as
far as applicable; provided, however that if Tenant fails to surrender the
Premises upon the termination of this Lease, in addition to any other
liabilities to Landlord arising therefrom Tenant shall indemnify and hold
Landlord harmless from loss or liability resulting from such failure, including
any claims made by any succeeding Tenant founded on such failure.

ARTICLE XXI.  WAIVER OF SUBROGATION

Landlord and Tenant each
releases and relieves the other and on behalf of its insurer(s) waives its
entire right of recovery against the other for loss or damage arising out of or
incident to the perils of fire, explosion, or any other perils generally
described in the “extended coverage” insurance endorsements used in Louisville
which occur in, on or about the Building and/or the Premises, whether due to
the negligence of such other party, its agents or employees, or otherwise.

 12
 

 

ARTICLE XXII. 
NOTICES

Wherever in this Lease it
shall be required or permitted that notice, approval, advice, consent or demand
be given or served by either party to this Lease to or on the other, such
notice or demand shall be given or served and shall not be deemed to have been
duly given or served unless in writing and forwarded by certified or registered
mail, addressed as follows:

	
  To Landlord:

  	
   

  	
  Mr. Steve Trager

  
	
   

  	
   

  	
  Republic
  Corporate Center

  
	
   

  	
   

  	
  601 W. Market
  Street

  
	
   

  	
   

  	
  Louisville, KY
  40202-2700

  
	
  To
  Tenant:

  	
   

  	
  At the Premises

  

 

Either party may change
such address by written notice by certified or registered mail to the other.

ARTICLE XXIII.  RIGHTS RESERVED BY LANDLORD

SECTION
1.  Landlord shall have
the sole and exclusive right to designate (and from time to time, in its
discretion, re-designate) the name, address, number and/or designation of the
Building.

ARTICLE XXIV.  CONDEMNATION

In the event that during
the term of this Lease the Premises as identified in Article I, Section 1
hereof, or any part thereof, or the use or possession thereof, is taken in
condemnation proceedings or by any right of eminent domain or for any public or
quasi-public use, this Lease and the term hereby granted shall terminate and
expire on the date when possession shall be taken by the condemnor, and rent
and all other charges payable hereunder shall be apportioned and paid in full
up to that date and all prepaid unearned rent and all other charges payable and
paid in full up to that date and all prepaid unearned rent and all other
charges payable hereunder shall forthwith be repaid by Landlord to Tenant, and
Tenant shall not be liable to Landlord for rent or any other charges payable
hereunder, damage, or otherwise, for, or by reason of any matter or thing
occurring thereafter. Tenant hereby waives any and all rights in, or to any
condemnation awards. In the event that during the term of this Lease a material
amount of the parking area or a material amount of the use or possession
thereof is taken in condemnation proceedings or by any right of eminent domain
or for any public or quasi-public use and no alternative parking is provided,
the term of this Lease shall at the option of Tenant cease and terminate from
the date of title vesting in such proceeding.

 13
 

 

ARTICLE
XXV.  MISCELLANEOUS PROVISIONS

SECTION
1.  The term “Landlord”
as used in this Lease, so far as covenants or obligations on the part of
Landlord are concerned, shall be limited to mean and include only the owner or
co-owners, at the time in question, of the Premises, and in the event of any
transfer or transfers of the title to the Premises, Landlord herein named (and
in case of any subsequent transfers or conveyances, the then grantor) shall be
automatically freed and relieved from and after the date of such transfer or
conveyance of all liability as respects the performance or any covenants or
obligations on the part of Landlord contained in this Lease thereafter to be
performed.

SECTION
2.  The captions of
Articles of this Lease are for convenience only and shall not be considered or
referred to in resolving questions of interpretation or construction.

SECTION
3.  The terms “Landlord
and Tenant”, wherever used herein shall be applicable to one or more persons,
as the case may be, and the singular shall include the plural, and the neuter
shall include the masculine and feminine, and if there be more than one, the
obligations hereof shall be joint and several.

SECTION
4.  The word “person”
and the word “persons” wherever used in this Lease shall both include
individuals, partnerships, firms, associations, and corporations of any other
form of business entity.

 14
 

 

SECTION
5.  The various rights,
options, elections, powers, and remedies contained in this Lease shall be
construed as cumulative and no one of them shall be exclusive of any of the
others, or of any other legal or equitable remedy which either party might
otherwise have in the event of breach or default in the terms thereof, and the
exercise of one right or remedy by such party shall not impair its right to any
other right or remedy until all obligations upon the other party have been
fully performed.

SECTION
6.  Time is of essence
with respect to the performance of each of the covenants and agreements under
this Lease.

SECTION
7.  Each and all of the
provisions of this Lease shall be binding upon and inure to the benefit of the
parties hereto and, except as set forth in Section 1 of this Article and as
otherwise specifically provided elsewhere in this Lease, their respective
heirs, executors, administrators, successors, and assigns, subject at all
times, nevertheless, to all agreements and restrictions contained elsewhere in
this Lease with respect to the assignment, transfer, encumbering or sub-letting
of all or any part of Tenant’s interest in this Lease.

SECTION
8.  This Lease shall be
interpreted in accordance with the law of the Commonwealth of Kentucky.

SECTION
9.  No waiver of any
default by Tenant hereunder shall be implied from any omission by Landlord to
take any action on account of such default if such default persists or is
repeated, and no express waiver shall affect any default other than the default
specified in the express waiver, and that only for the time and to the extent
therein stated. The acceptance by Landlord of rent with knowledge of the breach
of any of the covenants of this Lease by Tenant shall not be deemed a waiver of
any such breach. One or more waivers of any breach of any covenant, term or
condition of this Lease shall not be construed as a waiver of any subsequent
breach of the same covenants, term of condition. The consent or approval by
Landlord to or of any act by Tenant requiring Landlord’s consent or approval
shall not be deemed to waive or render unnecessary Landlord’s consent or
approval to or of any subsequent similar acts by Tenant.

SECTION
10.  If Tenant shall
default in the performance of any covenant on its part to be performed by
virtue of any provisions of this Lease, Landlord may, after any notice and the
expiration of any period with respect thereto as required pursuant to the
applicable provisions of this Lease, perform the same for the account of
Tenant. If Landlord, at any time, is compelled to pay or elects to pay any sum
of money or do any acts which would require the payment of any sum of money by
reason of the failure of Tenant, after any notice and the expiration of any
period with respect thereto, as required pursuant to the applicable provisions
of the Lease, to comply with any provisions of this Lease, the sum or sums so
paid by Landlord with all interest, costs and damages, shall be deemed to be
additional rental hereunder and shall be due from Tenant to Landlord on the
first day of the month following the incurring of such respective expenses,
except as otherwise herein specifically provided.

SECTION
11.  If Tenant or
Landlord shall bring any action for any relief against the other, declaratory
or otherwise, arising out of this Lease, including any suit by Landlord for the
recovery of rent, additional rent or other payments hereunder or possession of
the Premises, the losing party shall 

 15
 

 

pay the prevailing party a reasonable sum for
attorneys’ fees in such suit, at trial and on appeal, and such attorneys’ fees
shall be deemed to have accrued on the commencement of such action.

SECTION
12.  This Lease
contains all covenants and agreements between Landlord and Tenant relating in
any manner to the rental, use and occupancy of the Premises and Tenant’s
licensed use of the Building and other matters set forth in this Lease. No
prior agreement or understanding pertaining to the same shall be valid or of
any force or effect, and the covenants and agreements of this Lease cannot be
altered, changed, modified or added to except in writing signed by Landlord and
Tenant. No representation, inducement, understanding or anything of any nature
whatsoever made, stated or represented on Landlord’s behalf, either orally or
in writing (except this Lease) has induced Tenant to enter into this Lease.

SECTION
13.  Any provision or
provisions of this Lease which shall prove to be invalid, void or illegal shall
in no way affect, impair or invalidate any other provision hereof, and the
remaining provisions hereof shall nevertheless remain in full force and effect.

SECTION
14.  Except with
respect to those conditions, covenants and agreements of this Lease which by
their nature could only be applicable after the commencement of, during or
throughout the term of this Lease, all of the other conditions, covenants and
agreements of this Lease shall be deemed to be effective as of the date of
execution of this Lease.

SECTION
15.  Landlord and
Tenant each represents and warrants to the other that it has not engaged any
broker, finder or other person who would be entitled to any commission or fee
in respect of the negotiation, execution or delivery of this Lease, and shall
indemnify each other against loss, cost, liability, or expense incurred by
either as a result of any claim asserted by any such broker, finder or other
person on the basis on any arrangements or agreements made or alleged to have
been made by or on behalf of either Landlord or Tenant, as the case may be, in
breach of the foregoing warranty.

SECTION 16.  Any
and all consents and approvals of Landlord required by or referred to in the
Lease shall not be unreasonably withheld.

SECTION
17.  Notwithstanding
any other provisions contained in this lease, in the event the Tenant is closed
or taken over by the banking authority of the State of Kentucky, or other bank
supervisory authority, the Landlord may terminate the lease only with the
concurrence of such banking authority or other bank supervisory authority, and
any such authority shall in any event have the election either to continue or
to terminate the lease:  Provided, that
in the event this lease is terminated, the maximum claim of Landlord for
damages or indemnity for injury resulting from the rejection or abandonment of
the unexpired term of the lease shall in no event be in an amount exceeding the
rent reserved by the lease, without acceleration, for the year next succeeding
the date of the surrender of the premises to the Landlord, or the date of
re-entry of the Lessor, whichever first occurs, whether before or after the
closing of the bank, plus an amount equal to the unpaid rent accrued without
acceleration up to such date.

 16
 

 

IN WITNESS WHEREOF, the
parties have caused this Lease to be duly executed and delivered as of the day
and year first above written.

	
  ATTEST:

  	
   

  	
  TEECO

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Jan Hyland

  	
   

  	
  BY:

  	
   

  	
  /s/ Steven E. Trager

  
	
  Jan Hyland

  	
   

  	
  Steven E. Trager

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ATTEST:

  	
   

  	
  REPUBLIC
  BANK & TRUST COMPANY

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Jan Hyland

  	
   

  	
  BY:

  	
   

  	
  /s/ Kevin Sipes

  
	
  Jan Hyland

  	
   

  	
  Kevin Sipes

  

 

 17

 

EXHIBIT A

RULES AND REGULATIONS

1.             No advertisement, sign, lettering,
notice or device shall be placed in or upon the Premises or the Building,
including any windows, walls and exterior doors, except such as may be approved
in writing by Landlord.

2.             Lettering upon the doors as
required by Tenant shall be made by the sign company designated by Landlord,
but the cost shall be paid by Tenant. The directories of the Building will be
provided exclusively for the display of the name and location of Tenant and its
designated representative only, and Landlord reserves the right to exclude any
other names therefrom.

3.             No additional locks shall be placed
upon any doors of the Premises, and Tenant agrees not to have any duplicate
keys made without the consent of Landlord. If more than two keys for any door
lock are desired, such additional keys shall be paid for by Tenant. Upon
termination of this Lease, Tenant shall surrender all keys.

4.             No furniture, freight, supplies not
carried by hand or equipment of any kind shall be brought into or removed from
the Building without the consent of Landlord. Landlord shall have the right to
limit the weight and size and to designate the position of all safes and other
heavy property brought into the Building. Such furniture, freight, equipment,
safes and other heavy property shall be moved in or out of the Building only at
the times and in the manner permitted by Landlord. Landlord will not be
responsible for loss of or damage to any of the items above referred to, and
all damage done to the Premises or the Building by moving or maintaining any of
such items  shall be repaired at the
expense of Tenant. Any merchandise not capable of being carried by hand shall
utilize hand trucks equipped with rubber tires and rubber side guards.

5.             The entrances, corridors, stairways
and elevators shall not be obstructed by Tenant, or used for any other purpose
than ingress or egress to and from Premises. Tenant shall not bring into or
keep any animal within the Building, or any bicycle or other type of vehicle.

6.             Tenant shall not disturb other
occupants of the Building by making an undue or unseemly noise, or otherwise.
Tenant shall not, without Landlord’s prior written consent, install or operate
in or on Premises any machine or machinery causing noise or vibration
perceptible outside the Premises, electric heater, stove or machinery or any
kind or carry on any mechanical business thereon, or keep or use thereon oils,
burning fluids, camphene, kerosene, naphtha, gasoline, or other coustible materials.
No explosives shall be brought into the Building.

 18
 

 

7.             Tenant shall not mark, drive nails,
screw or drill into woodwork or plaster, paint or in any way deface the
Building or any part thereof, or the Premises or any part thereof, or fixtures
therein. The expense of remedying any breakage, damage or stoppage resulting
from a violation of this rule shall be borne by Tenant.

8.             If Tenant installs upon the
Premises any electrical equipment which constitutes an overload on the
electrical line serving the Premises or the Building, Tenant shall make all
necessary changes to reduce such overload, or at the option of Landlord,
eliminate such equipment as Landlord deems necessary to reduce the electrical
capacity required to serve the Premises.

9.             Canvassing, soliciting, and
peddling in the Building is prohibited and Tenant shall cooperate to prevent
such activity.

10.           The requirements of Tenant will be
attended to only upon application at the Landlord’s office in the Building.
Building employees shall not perform any work or do anything outside of the
regular duties, except on issuance of special instructions from the office of
the Building. If the Building employees are made available for the assistance
of Tenant, Landlord shall be paid for their services by Tenant at reasonable
hourly rates. No Building employee will admit any person (Tenant or otherwise)
to any office without specific instructions from the office of the Building.

11.           Landlord reserves the right to close
and keep locked all entrance and exit doors of the Building on Saturdays,
Sundays, legal holidays, and between the hours of 5:30 p.m. of any day and 8:00
a.m. of the following day, and during such further hours as Landlord may deem
advisable for the adequate protection of the Building and the property of the
tenants. Tenant shall have 24-hour access to the Premises.

 19Exhibit 4.6

 

Dated 1 November 2005

 

 

DIAGEO
PLC                                           (1)

PAUL
WALSH                                         (2)

 

 

SERVICE AGREEMENT

 

 

Contents

	
  

  	
  

  	
  Clause

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Definitions and interpretation

  	
   

  	
  3

  
	
  2

  	
   

  	
  Appointment

  	
   

  	
  4

  
	
  3

  	
   

  	
  Duration of the Employment

  	
   

  	
  4

  
	
  4

  	
   

  	
  Scope of the Employment

  	
   

  	
  6

  
	
  5

  	
   

  	
  Hours of work

  	
   

  	
  8

  
	
  6

  	
   

  	
  Place of work

  	
   

  	
  8

  
	
  7

  	
   

  	
  Remuneration

  	
   

  	
  8

  
	
  8

  	
   

  	
  Car

  	
   

  	
  9

  
	
  9

  	
   

  	
  Expenses

  	
   

  	
  9

  
	
  10

  	
   

  	
  Holidays

  	
   

  	
  10

  
	
  11

  	
   

  	
  Sickness benefits

  	
   

  	
  10

  
	
  12

  	
   

  	
  Pension

  	
   

  	
  11

  
	
  13

  	
   

  	
  Other Benefits

  	
   

  	
  11

  
	
  14

  	
   

  	
  Restrictions during the Employment

  	
   

  	
  12

  
	
  15

  	
   

  	
  Confidential information and company documents

  	
   

  	
  12

  
	
  16

  	
   

  	
  Inventions and other intellectual property

  	
   

  	
  13

  
	
  17

  	
   

  	
  Termination

  	
   

  	
  14

  
	
  18

  	
   

  	
  Restrictive covenants

  	
   

  	
  16

  
	
  19

  	
   

  	
  Disciplinary and grievance procedures

  	
   

  	
  17

  
	
  20

  	
   

  	
  Notices

  	
   

  	
  18

  
	
  21

  	
   

  	
  Former contracts of employment

  	
   

  	
  18

  
	
  22

  	
   

  	
  Choice of law and submission to jurisdiction

  	
   

  	
  18

  
	
  23

  	
   

  	
  General

  	
   

  	
  18

  

 

 2
 

 

This Agreement is made on 1 November 2005

Between

(1)                                  Diageo Plc (registered in England and Wales under number 23307) whose registered
office is at 8 Henrietta Place, London, W1G 0NB (Company);
and

(2)                                  Paul Walsh of Ashfold Grange, Horsham Road, Handcross, West Sussex, RH17 6DT (Executive).

It is agreed

1                                         Definitions and interpretation

1.1                                 In this Agreement unless the context otherwise requires the following
expressions have the following meanings:

Board means the board
of directors for the time being of the Company, any authorised director or any
committee of directors for the time being

Chairman means the Chairman of the Board

Confidential Information means details of suppliers and their terms of business, details of
customers and their requirements, the prices charged to and terms of business
with customers, marketing plans and sales forecasts, financial information,
results and forecasts (save to the extent that these are included in published
audited accounts), any proposals relating to the acquisition or disposal of a
company or business or any part thereof or to any proposed expansion or
contraction of activities, details of employees and officers and of the
remuneration and other benefits paid to them, trade secrets, information
relating to research activities, inventions, secret processes, designs,
formulae and product lines, any information which is treated as confidential or
which the Executive is told or ought reasonably to know is confidential and any
information which has been given to the Company or any Group Company in
confidence by customers, suppliers or other persons

Employment means the Executive’s employment under this Agreement

ERA means the
Employment Rights Act 1996 as amended

Group means the
Company and the Group Companies

Group Company means any company which is for the time being a subsidiary or holding
company of the Company and any subsidiary of any such holding company and for
the purposes of this Agreement the terms subsidiary and holding company shall have the meanings ascribed to them by
sections 736 and 736A Companies Act 1985 (and Group
Companies shall be interpreted accordingly)

Intellectual Property means all patents, registered designs, trade marks and service marks
(whether registered or not and including any applications for the foregoing),
copyrights, design rights, semiconductor topography rights, database rights and
all other intellectual property and similar proprietary rights subsisting in
any part of the world (whether or not capable of registration) and including
(without limitation) all such rights in materials, works, prototypes,
inventions, discoveries, techniques, computer programs, source codes, data,
technical, commercial or confidential information, trading, business or brand
names, goodwill or the style of presentation of the goods or services or any
improvement of any of the foregoing and the right to apply for registration or
protection of any of them and in existing applications for the protection of
any of the above

Normal Retirement Date means the Executive’s 62nd birthday

Pension
Scheme means the Diageo Pension Scheme

 3
 

 

Remuneration Committee means the Remuneration Committee of the Company from time to time

Salary means the salary referred to in clause 7.1

Sensitive Data means personal data consisting of information as to racial or ethnic
origin; political opinions; religious beliefs or other beliefs of a similar
nature; membership of a trade union (within the meaning of the Trade Union and
Labour Relations (Consolidation) Act 1992); physical or mental health or
condition; sexual life; the commission or alleged commission of any offence or
any proceedings for any offence committed or alleged to have been committed,
including the disposal of such proceedings or the sentence of any court in such
proceedings

Termination Date means the date of the termination of the Employment or, where the
Company exercises its rights under clause 3.7 to require the Executive to
remain at home, the last day on which the Executive was required to work

1.2                                 References to clauses and schedules are unless otherwise stated to
clauses of and schedules to this Agreement.

1.3                                 The headings to the clauses are for convenience only and shall not
affect the construction or interpretation of this Agreement.

2                                         Appointment

2.1                                 The Company appoints the Executive and the Executive agrees to act as
Chief Executive of the Company or in such other capacity of a like status as
the Company from time to time reasonably directs on the terms of this
Agreement.

3                                         Duration of the Employment

3.1                                 The Employment under this Agreement shall commence on  October 2005 and, subject to the provisions
of this Agreement, shall continue unless and until terminated by the Company
giving to the Executive not less than 12 months’ notice in writing or by
the Executive giving to the Company not less than 6 months’ notice in
writing at any time.  In circumstances in
which the Company has served notice, it shall not require the Executive to work
for more than six months during the notice period and in respect of any such
period worked, the Executive will continue to receive full remuneration and
benefits (including bonus entitlement).

3.2                                 Notwithstanding clause 3.1, the Employment shall automatically terminate
when the Executive reaches the Normal Retirement Date.

3.3                                   (a)            The Company shall
have the discretion to terminate the Employment lawfully without any notice or
on notice less than that required by clause 3.1, by paying to the Executive a
sum equal to 200% (two hundred per cent) of the Salary in respect of that part
of the period of notice in clause 3.1 which the Company has not given to
the Executive (less any appropriate tax and other statutory deductions) in
circumstances not falling within clause 3.3(b). 
It is recognised that this sum is deemed to represent the salary and all
other contractual benefits which the Executive would have received if the
period of notice in clause 3.1 which the Company has not given to the Executive
had in fact been given to the Executive.

(b)                                 The Company shall have the discretion to terminate the Employment
lawfully without the notice required by clause 3.1, by paying to the
Executive a sum equal to 100% (one hundred per cent) of the Salary in respect
of the 12 month period of notice required from the Company under clause
3.1  (less any appropriate tax and other
statutory deductions) in the event that the Executive has demonstrated, in the
reasonable opinion of the Board, a failure to perform his duties competently provided
always that the Company has given the Executive prior written notice of such
failure specifying in reasonable detail the basis of the alleged failure and
the steps required to remedy the failure within a reasonable period and he has
failed to do so.  Any payment under this
clause 3.3(b) shall be made within 28 days of the termination of the
Employment.

 4
 

 

(c)                                  For the avoidance of doubt, the Company’s right to pay in lieu of notice
under this clause 3.3 applies to any notice of termination, including circumstances
in which the Company elects to pay in lieu of notice (or part of the notice)
served by the Executive to terminate the Employment.

(d)                                 In the event that the Company terminates the Employment other than in
accordance with clause 3.1, clause 3.3, clause 3.6 or clause 17 (including, for
the avoidance of doubt, circumstances where the Company gives notice to
terminate the Employment under clause 3.1, has required the Executive to work
for up to six months during the notice period and has not elected to pay in
lieu of the balance of the notice period under clause 3.3), the Company shall
pay to the Executive the amount to which he would have been entitled under
clause 3.3 above had the Company exercised its discretion to terminate the
Employment under that clause.  It is
recognised that the provisions set out in this clause 3.3(d) represent
pre-agreed liquidated damages and reflect a genuine pre-estimate of the loss
that would otherwise be suffered by the Executive and that the Executive is not
required to mitigate his loss in relation to these pre-agreed liquidated
damages.  Any amount payable under this
clause 3.3(d) shall be made in the same manner as the relevant payment under
clause 3.3 (including, for the avoidance of doubt, the provisions of clause
3.4).

(e)                                  This clause 3.3 is without prejudice to the Company’s rights under
clause 17.1

3.4                                 The Company may at its absolute discretion lawfully make the payment
under clause 3.3(a) by way of:

(a)                                  half the payment being paid within 28 days of the termination of the
Employment; and

(b)                                 the remaining half of the payment being paid in 12 equal monthly
instalments which shall commence in the month following the expiry of that part
of the period of notice in clause 3.1 in respect of which the Company is
paying in lieu, provided that, at the absolute discretion of the Company, such
monthly instalments shall:

(i)                                     cease to be payable upon the Executive commencing new full-time
employment for which his remuneration will, in the reasonable opinion of the
Company, be greater than or broadly comparable with his remuneration under this
Agreement.

(ii)                                  cease to be payable in full but continue to be payable in part upon the
Executive commencing new employment or engagement for which his remuneration
will, in the reasonable opinion of the Company, be significantly lower than his
remuneration under this Agreement in which circumstances the instalments shall
be reduced by any earnings (to the extent that such earnings exceed the
Threshold) payable to the Executive as a result of such new employment during
the period in respect of which he is being paid in lieu.  For the purposes of this sub-clause,
Threshold shall mean an annualised sum of £250,000 (such sum to be increased by
the same percentage increase to Salary as takes place between the date of this
Agreement and the Termination Date), such annualised amount to be pro rated to
reflect the duration of the part of the period of notice in clause 3.1 in
respect of which the Company is paying in lieu. 
For the avoidance of doubt, Threshold shall not include income
associated with the Executive’s two standard non executive appointments held
prior to the Termination Date which income shall be excluded from the
calculation of the Threshold.

3.5                                 Should the Company exercise its discretion to terminate the Employment
pursuant to clause 3.3, all the Executive’s post termination obligations
contained in this Agreement, including in particular the restrictive covenants
in clause 18, shall remain in full force and effect.

3.6                                  (a)           If at any time within
12 months of a Corporate Change either the Company terminates the Employment
other than pursuant to clause 17.1 and without any notice or on notice less
than that required by clause 3.1 or the Executive resigns for Good Reason (in
either event as a consequence of the Corporate Change), the Company shall be
obliged to terminate the Employment lawfully by making a payment in lieu of
notice in accordance with clause 3.3 save

 5
 

 

that, in the
event that such payment is made under clause 3.3(a), it is agreed that it shall
be paid as a single lump sum payment within 28 days of the termination of the
Employment.  For the avoidance of doubt,
in the event that the Executive resigns for Good Reason in accordance with this
clause 3.6(a), this shall be treated as a termination of the Employment by the
Company for the purposes of calculating the notice period and the relevant
payment in lieu of notice under this clause 3.6(a).  This clause 3.6(a) shall not apply in the
event that the Executive gives notice to terminate the Employment other than
for Good Reason.

(b)           For
the purposes of clause 3.6(a) above Corporate
Change means:

(i)
                                  the acquisition by the Company or any Group Company of shares in any
other company or any other assets or business which, in the opinion of the
Remuneration Committee (whose determination in respect of such matters shall be
final and binding), constitutes a major acquisition or merger; or

(ii)                                  the Company coming under the control of any person or persons acting in
concert (as those terms are defined for the time being in the City Code on
Takeovers and Mergers) not having control of the Company at the date of this
Agreement.

(c)                                  For the purposes of clause 3.6(a), a Good Reason shall mean
circumstances in which the Executive resigns due to (a) a material diminution
in his status and/or responsibilities and/or (b) a requirement for the
Executive to be located permanently outside the United Kingdom and Eire (which
shall include a requirement for long term extensive commuting to such a location
other than during the six months immediately following the Corporate Change).

3.7                                 At any time during any period of notice of termination served in
accordance hereunder by the Executive (other than in circumstances in which the
Executive resigns for Good Reason under clause 3.6(a)), the Company shall have
the right at its absolute discretion to assign no, reduced or alternative
duties to the Executive (provided that any such duties shall be consistent with
the Executive’s status) and shall be entitled to require the Executive to act
at the direction of the Company including the right to exclude him from its
premises, and/or remove him from office as a director of the Company and from
any or all offices held by him in the Company or in any other Group Company
(including if appropriate the office of trustee of any of the pension schemes
of the Group) and/or prevent the Executive from discussing its affairs with the
Company’s or any other Group Company’s employees, agents, clients or
customers.  The Executive agrees that
during any period of notice given by either party, he will give the Company or
such person nominated by it all assistance and co-operation in effecting a
smooth and orderly handover of his duties as the Company may require.   If the Company shall exercise its right
under this clause, the Executive’s entitlement to Salary and other contractual
benefits shall continue, subject always to the rules of any relevant scheme or
policy relating to such benefits.  For
the avoidance of doubt, at all times during any period of notice of termination
served in accordance hereunder, the Executive shall continue to be bound by the
same obligations as were owed to the Company prior to the commencement of the
notice period.

3.8           For
the purposes of the ERA the Executive’s period of continuous employment began
on 1 April 1982.

3.9                                 The Executive represents and warrants that he is not bound by or subject
to any court order, agreement, arrangement or undertaking which in any way
restricts or prohibits him from entering into this Agreement or from performing
his duties under it.

4                                         Scope of the Employment

4.1                                 During the Employment the Executive shall:

(a)                                  devote the whole of his time, attention and skill to the business and
affairs of the Company during the hours of work described in clause 5
except during holidays and periods of absence due to ill health;

(b)                                 faithfully, competently and diligently perform such duties and exercise
such powers consistent with his position as may from time to time be assigned
to or vested in him by the Board.  Such

 6
 

 

powers and duties
may exceptionally fall outside the normal ambit of the Executive’s position but
will not be duties inappropriate to the Executive’s status;

(c)                                  use his best endeavours to promote and maintain the interests and reputation
of the Group;

(d)                                 report to the Chairman for the time being of the Board (or such other
person being a member of the Board as the Board may from time to time nominate
and notify the Executive);

(e)                                  obey the reasonable and lawful directions of the Board;

(f)                                    comply with all the Company’s rules, regulations, policies and
procedures from time to time in force;

(g)                                 travel to such places (within or outside the United Kingdom) in such
manner and on such occasions as the Company may from time to time reasonably
determine;

(h)                                 refrain from doing or permitting any matter which causes any regulatory
authority in the United Kingdom or elsewhere to withdraw permission or in any
way prevent the Company from employing or otherwise using the services of the
Executive;

(i)                                     not at any time without the prior consent of the Board incur on behalf
of the Company or any Group Company any capital expenditure in excess of such
sum as may be authorised from time to time by the Board or enter into on behalf
of the Company or any Group Company any commitment, contract or arrangement
which is otherwise than in the normal course of business or is outside the
scope of his normal duties or is of an unusual or onerous or long term nature;

(j)                                     not without the prior consent of the Board seek or accept from any
actual or prospective customer, controller or supplier of the Group any gift,
gratuity or benefit which breaches the Company’s Code of Conduct and, in
particular, the provisions of that Code relating to Acceptance of Entertainment
and Gifts.  In case of doubt, the
Executive shall consult the Board in relation to these matters; and

(k)                                  keep the Board at all times promptly and fully informed (in writing if
so requested) of his conduct of the business of the Company and any Group Company
and provide such explanations in connection with it as the Board may require.

4.2                                 The Company shall be entitled at any time to require the Executive to
perform duties consistent with his role and status not only for the Company but
also for any Group Company including, if so required, acting as a director of
any Group Company.  The Company may at
its sole discretion transfer this Agreement to any Group Company at any time.

4.3                                 Notwithstanding clause 4.1, the Executive shall be entitled to take
up such non-executive appointments as are approved by the Board from time to
time (such approval not to be unreasonably withheld) but only to the extent
that the discharge of his duties under this Agreement is not impaired as a
result.

4.4                                 For the purposes of the Data Protection Act 1998, the Executive consents
to the Company’s processing of personal data, including Sensitive Data, of
which the Executive is the subject details of which are specified in the
Company’s Data Privacy Policy.  In
particular:

(a)                                  The Executive agrees that personal data relating to the Executive which
has been or is in the future obtained by the Group may be held and processed by
the Group either by computer or manually for any purpose relating to the
administration, management and operation of the Executive’s employment, or in
relation to the Group’s legal obligations or business needs.

(b)                                 The Executive hereby agrees that Sensitive Data concerning the Executive
which have been or is in the future obtained by the Group may also be held and
processed as above for the purposes of keeping under review equality of
opportunity and for ensuring the Company’s compliance with any legal
obligations.

 7
 

 

(c)                                  Due to the multinational nature of the Group’s business, it may be
necessary for the Group’s overseas offices to have access to information held
about the Executive in the UK by the Group. 
However, it is only intended that information about the Executive will
be used by the Group’s overseas offices for the purposes of enabling the Group
to deal with personnel issues connected with the Executive’s employment,
including advising relevant statutory authorities in order to obtain a work
permit or visa or assisting in the Executive’s secondment to an overseas office
for payroll purposes.  The Executive
agrees that the Company may, where appropriate, transfer personal information
about the Executive to the Group’s overseas offices.

4.5                                 The Company has implemented a Global Computer Usage, Email and Internet
Policy, Alcohol Policy, Drugs/Solvent Abuse and Dependency Policy, Expenses
Policy and Mobile Phones Policy which the
Executive is obliged to comply with at all times during the Executive’s
employment.  In particular, the Executive’s
attention is drawn to the sections of the Global Computer Usage, Email and Internet  Policy which indicate that the Company may
from time to time monitor the Executive’s use of its communication systems,
namely its computer systems and telephones. 
The Executive acknowledges that the Company has a legitimate interest in
carrying out this monitoring and that, by signing this Agreement, the Executive
consents to it.

5                                         Hours of work

5.1                                 The normal business hours of the Company are 9.00am to 5.00pm,  Monday to Friday.  However, the Executive shall be required to
work such hours as are necessary to fulfil his duties under this
Agreement.  No payment will be made for
any additional hours worked by the Executive.

5.2                                 The Executive recognises that on account of his autonomous decision
taking powers, the duration of his working time is not measured or
predetermined and therefore he falls within the exemption set out in Regulation
20 of the Working Time Regulations 1998 (“the Regulations”) and is thereby
excluded from such Regulations as are referred to in Regulation 20.  Notwithstanding the understanding of the
parties that the Executive is an employee in respect of whom Regulation 20
applies, the Executive agrees that, if the understanding of the parties is
incorrect, he hereby opts out of the 48 hour week limit in Regulation 4, and
that if he wishes to withdraw that opt-out, he will give 3 months’ notice in
writing to that effect.

6                                         Place of work

The Executive’s place of work will initially be the
Company’s offices at 8 Henrietta Place, London, W1G 0NB  but the Company may require the Executive to
work at any other location for such periods as the Company may from time to
time require.

7                                         Remuneration

7.1                                 The Company shall pay to the Executive the Salary at the rate of
£930,000 per annum, on or about the 27th day of each calendar month by credit
transfer to his bank account payable by equal monthly instalments in arrears
(or such other sum as may from time to time be agreed).  The rate of Salary will normally be reviewed
annually on 1st October.

7.2                                 In addition to his Salary, the Executive will be eligible to participate
in such of the following incentive schemes as exist from time to time for
senior executives of the Company, subject always to their respective rules:

(a)           Diageo
Annual Incentive Plan;

(b)           Diageo
Senior Executive Share Option Plan;

(c)           Diageo
Long Term Incentive Plan (The TSR Plan); and/or

(d)           Diageo
2001 Share Incentive Plan and Diageo UK Sharesave Scheme 2000.

 8
 

 

The Executive’s participation in such plans and
schemes is at the discretion of the Company.  
If the Company shall make a payment or grant an award under such plans
and/or schemes in any one year, this shall not give rise to a contractual
entitlement to a payment or award in future years.  Further, the Company may at its discretion reduce
the Executive’s participation in the incentive schemes at (b) and (c) above in
the event that he fails to satisfy the minimum shareholding requirement (based
on his salary and length of service) applicable to him which will be notified
to him from time to time.

Without prejudice to the foregoing, the Executive will
be considered (at the sole discretion of the Company) for a bonus in respect of
the then current bonus year in the event that the Employment is terminated by
the Company pursuant to clause 3.1, clause 3.3 and/or clause 3.6.

7.3                                 The Salary shall be inclusive of any fees to which the Executive may be
entitled as a director of the Company or any Group Company.  The Executive agrees to forthwith pay to the
Company or procure that the Company is paid all such fees received by him.

7.4                                 Payment of the Salary to the Executive shall be made either by the
Company or by a Group Company and, if by more than one company, in such
proportions as the Board may from time to time think fit.

7.5                                 The Company shall be entitled to deduct from any sum due to the
Executive under the terms of this Agreement any monies which are owed by the
Executive to the Company.

8                                         Car

8.1                                 (a)                                     Subject to his remaining legally qualified and fit to drive, the Company
shall provide the Executive with a car or cars of a size and type in accordance
with the Company’s car policy as published and amended from time to time.

(b)                                 The Company shall tax and comprehensively insure the car or cars and pay
or reimburse, as appropriate, against receipts or other appropriate evidence as
the Company may require the costs of running, servicing and repairing the car
or cars including all petrol purchased for the main car (but not the second
car) in the United Kingdom.  Any other
running expenses relating to private use of the car or cars shall be the
Executive’s responsibility.  This would
include, for example and not exclusively, parking fines, tolls and car wash
charges.

8.2                                 As an alternative to clause 8.1, the Executive may receive a car
allowance of £16,150 per annum subject to statutory deductions, payable in
equal monthly instalments in arrears. 
This allowance will not increase the Executive’s salary for the purposes
of the pension scheme or otherwise.

8.3                                 If the Executive shall be convicted of any offence under the Road
Traffic Acts or become involved in any accident involving the car, he shall
immediately notify the Board and supply such information in connection with
such conviction or accident as the Board may request.

8.4                                 The Executive shall use the car or cars only in accordance with the
Company rules from time to time relating to such use and shall not do anything
which would or might void or prejudice any policy of insurance taken out by the
Company in respect of the car or cars.

8.5                                 The Executive shall ensure that at all times when the car or cars are
driven on the road it or they are in the state and condition required by law
and that if so required a current test certificate is in force relating to it.

8.6                                 In order to assist him in the performance of his duties, the Company
shall provide the Executive with the use of a chauffeur and a car as allocated
from time to time from the Company’s car pool.

9                                         Expenses

9.1                                 The Company shall reimburse the Executive in respect of all reasonable
expenses wholly, exclusively and necessarily incurred by him in the proper
performance of his duties, subject to his providing such receipts or other
appropriate evidence as the Company may require.

9.2                                 The Executive will be issued with a company credit card on condition
that he:

 9
 

 

(a)                                 takes good care of such card and immediately reports any loss of it
to the Company;

(b)                                 uses the card only for the purposes of the Company’s business or the
business of the Group in accordance with any applicable Company policy; and

(c)                                  returns the card immediately to the Company on request.

10                                  Holidays

10.1                           The Executive shall be entitled, in addition to all Bank and Public
holidays normally observed in England, to 30 working days’ paid holiday in
each holiday year (being the period from 1 January to 31 December).

10.2                           In the respective holiday years in which the Employment commences or
terminates, the Executive’s entitlement to holiday shall accrue on a pro rata
basis for each completed calendar month of service during the relevant year.

10.3                           If, on the termination of the Employment, the Executive has exceeded his
accrued holiday entitlement, the value of such excess, calculated by reference
to clause 10.2 and the Salary, may be deducted by the Company from any
sums due to him.  If the Executive has
any unused holiday entitlement, the Company shall at its discretion either
require the Executive to take such unused holiday during any notice period or
make a payment to him in lieu of it (calculated in accordance with this
clause 10.3), provided always that if the Employment is terminated
pursuant to clause 17.1 then, subject to the Regulations, the Executive shall
not be entitled to any such payment.  For
these purposes, salary in respect of one day’s holiday entitlement shall be
calculated as 1/261 of Salary.

10.4                           Holiday entitlement for one holiday year cannot be carried forward from
one year to the next and failure to take holiday entitlement in the appropriate
holiday year will lead to forfeiture of any accrued holiday not taken without
any right to payment in lieu of it provided always that any days of holiday not
taken at the Company’s written request in one year may be carried forward to
the next year.

11                                  Sickness benefits

11.1                           If the Executive is absent from his duties as a result of sickness or
injury:-

(a)                                  for a period of 6 days or less, he will on his return to work on
request, complete and produce a self-certificate;

(b)           for
a period of 7 days or more he will, on request, produce medical certificates;

to the Company in respect of such absence.

11.2                           Subject to clauses 3 and 17, the Company shall continue to pay the
Salary for the first 12 months’ absence on medical grounds in any one
continuous period of absence (or two or more linked periods as determined by
the Social Security Contributions and Benefits Act 1992, as amended from time
to time), provided that the Executive shall from time to time if required:

(a)                                  supply the Company with medical certificates covering any period of
sickness or incapacity exceeding 6 days (including weekends); and

(b)                                 undergo at the Company’s expense, by a doctor appointed by the Company,
any medical examination and the Executive hereby authorises such doctor to
disclose to, and discuss with the Company and its medical advisers, the results
of such examinations.

11.3                           Payment in respect of any other or further period of absence shall be at
the Company’s discretion.

11.4                           Any payment to the Executive pursuant to clause 11.2 shall be
subject to set off by the Company in respect of any Statutory Sick Pay and any
Social Security Sickness Benefit or other benefits to which the Executive may
be entitled.

 10

 

11.5                           Subject to clause 11.4, when all sick pay entitlement pursuant to
clause 11.2 has been exhausted, no further salary will be payable by the
Company to the Executive until the Executive has returned to active service of
the Company.  In such circumstances,
provided the Company is satisfied that the Executive is not fit to return to
work, the Company will at the request of the Executive apply to the Trustees of
the Pension Plan (“Trustees”) for an ill health early retirement pension for
the Executive and such application shall be dealt with subject to and in
accordance with the rules of the Pension Scheme.  In this regard, the Executive will undergo
such medical examinations and attend such meetings with the Company’s
Occupational Health Department as may be required by the Company and/or the
Trustees.

11.6                           If the Executive’s absence shall be occasioned by the actionable
negligence of a third party in respect of which damages are recoverable, then
the Executive shall:

(a)                                  notify the Company immediately of all the relevant circumstances and of
any claim, compromise, settlement or judgment made or awarded in connection
with it;

(b)                                 give to the Company such information concerning the above matters as the
Company may reasonably require; and

(c)                                  if the Company so requires, refund to the Company any amount received by
him from any such third party provided that the refund shall be no more than
the amount which he has recovered in respect of remuneration.

12                                  Pension

12.1                           During the Employment the Executive shall be eligible for membership of
the Pension Scheme on the basis of benefits under the Senior Executive Tier SE
Section of the Pension Scheme which provide for enhanced pension accrual.  The Executive will be required to make
contributions to the Pension Scheme with effect from April 2006 in accordance
with the rules of the Pension Scheme from time to time.  The Executive’s membership of and pension
benefits under the Pension Scheme will be subject always to the rules of the
Pension Scheme.  Such rules may be amended
from time to time.

12.2                           To the extent that the accrual or value of the Executive’s benefits
under the Pension Scheme:

(a)                                  Is limited by Inland Revenue requirements prevailing until 5 April
2006;or

(b)                                 After 5 April 2006 would exceed the Executive’s individual lifetime
allowance, including relevant enhancement factors (as set out in Part 4,
Chapter 5 of the Finance Act 2004),

the excess will be provided through the Guinness
Unapproved Pension Scheme (“the Unapproved Scheme”) subject to the rules of the
Pension Scheme and the Unapproved Scheme as amended from time to time.  The Executive will be responsible for
the payment of any taxes or charges which may arise in respect of his
benefits under the Pension Scheme and the Unapproved Scheme.  The
Executive agrees to any amendments to the Pension Scheme and the
Unapproved Scheme designed to effect the terms of this clause 12.2.

12.3                           The Pension Scheme is a contracted-out scheme for the purposes of the
Pension Schemes Act 1993.

13                                  Other Benefits

13.1                           During the Employment the Executive shall:

(a)                                  participate in such personal accident insurance and medical expenses
insurance schemes (such participation to include medical expenses cover in
respect of his spouse and dependent children under the age of 18) at such level
as the Company shall (in its absolute discretion) from time to time maintain
for the benefit of the Executive;

(b)                                 be provided with life insurance cover under the Pension Scheme

 11
 

 

 

subject in each case, to the insurer accepting the
Executive for cover under the relevant policy and at normal rates and subject
always to their terms and conditions from time to time in force and provided
always that the provision of such benefits is without prejudice to the Company’s
right at its absolute discretion to terminate the Employment at any time in
accordance with clauses 3 and 17.

13.2                           In accordance with Company policy on medical examination, the Executive
will be entitled to a regular medical examination and test by a medical
practitioner nominated by the Company.

13.3                           The Company will pay for the Executive to receive tax and financial
planning advice from an adviser approved by the Company, with such level of
benefits as the Company shall in its absolute discretion decide.  If the Executive is employed for part of a
calendar year, he will receive a pro rated entitlement.

13.4                           The Executive will be provided with a taxable product allowance not
exceeding £1,250 (including VAT) per annum. 
If the Executive is employed for part of a full calendar year, he will
receive a pro rated allowance.

13.5                           The Company shall pay on the Executive’s behalf the annual subscription
fees for one professional body relevant to the Employment

14                                  Restrictions during the Employment

14.1                           During the Employment the Executive shall not directly or indirectly be
employed, engaged, concerned or interested:

in any activity which the Board reasonably considers
may be, or become, harmful to the interests of the Company or of any Group
Company or which might reasonably be considered to interfere with the
performance of the Executive’s duties under this Agreement.

14.2                           Clause 14.1 shall not apply:

(a)                                  to the Executive holding (directly or through nominees) investments
listed on the Official List of London Stock Exchange plc or in respect of which
dealing takes place in the Alternative Investment Market or any recognised
stock exchange as long as he does not hold more than 3 per cent of the
issued shares or other securities of any class of any one company; or

(b)                                 to any act undertaken by the Executive with the prior written consent of
the Board; or

(c)                                  to any interest permitted by clause 4.3.

14.3                           The Executive shall comply with every rule of law (including but not
limited to the insider dealing provisions contained in Part V of the Criminal
Justice Act 1993), the UK Listing Authority’s listing rules’ Model Code for
transactions in securities by directors of listed companies, certain employees
and persons connected with them and every regulation of the Company for the
time being in force in relation to dealings in shares or other securities of
the Company or any Group Company.  Under
Rule 6 of the Model Code, the person to whom notice should be given and from
whom acknowledgement must be received before the Executive may deal in
securities shall be the Company Secretary of the Company from time to time or
such other person as shall be notified to the Executive.  The Executive also acknowledges that under
the provisions of the Model Code the Executive must seek to ensure compliance
with the Model Code by persons connected with the Executive (within the meaning
of section 346 of the Companies Act 1985) including, without limitation, the
Executive’s spouse and dependent children, and by investment managers acting on
the Executive’s behalf or on behalf of connected persons.  The Executive undertakes to procure that
dealings by or on behalf of such persons are in compliance with the Model Code.

15                                  Confidential information and company documents

15.1                           The Executive shall neither during the Employment (except in the proper
performance of his duties or for the purpose of obtaining legal, accountancy or
pension advice or with the express written consent

 12
 

 

 

of the Board) nor
at any time (without limit) after the termination of the Employment except in
compliance with an order of a competent court, the Inland Revenue or any
regulatory authority:

(a)                                  divulge or communicate to any person, company, business entity or other
organisation;

(b)                                 use for his own purposes or for any purposes other than those of the
Company or any Group Company; or

(c)                                  through any failure to exercise due care and diligence, permit or cause
any unauthorised disclosure of

any Confidential Information.  These restrictions shall cease to apply to
any information which shall become available to the public generally otherwise
than through any breach by the Executive of the provisions of this Agreement or
other default of the Executive.

15.2                           The Executive acknowledges that all books, notes, memoranda, records,
lists of customers and suppliers and employees, correspondence, documents,
computer and other discs and tapes, data listings, codes, designs and drawings
and other documents and material whatsoever (whether made or created by the
Executive or otherwise) relating to the business of the Company or any Group Company
(and any copies of the same):

(a)                                  shall be and remain the property of the Company or the relevant Group
Company; and

(b)                                 shall be handed over by the Executive to the Company or to the relevant
Group Company on demand and in any event on the termination of the Employment
and the Executive shall certify that all such property has been handed over on
request by the Board.

Provided that following the termination of the
Employment, the Executive shall be provided with reasonable access to Board
Minutes and agendas of the Company or any Group Company relating to a period
during which he was a director of the 
Company or such Group Company which shall nevertheless remain
confidential.

16                                  Inventions and other intellectual property

16.1                           The parties foresee that the Executive may make inventions or create
other Intellectual Property in the course of his duties and agree that in this
respect the Executive has a special responsibility to further the interests of
the Company and any Group Company.

16.2                           Any invention, improvement, design, process, information, copyright
work, computer program, trade mark, trade name or get-up, work or other output
(Work) made, created or discovered by
the Executive during the Employment (whether capable of being patented or
registered or not and whether or not made or discovered in the course of the
Employment) in conjunction with or in any way affecting or relating to the
business of the Company or of any Group Company or capable of being used or
adapted for use in or in connection with such business, together with all
Intellectual Property subsisting therein, (collectively Intellectual
Property Rights) shall be disclosed immediately to the Company and
shall (subject to sections 39 to 43 Patents Act 1977) belong to and
be the absolute property of the Company or such Group Company as the Company
may direct and the Executive hereby assigns to the Company with full title
guarantee and by way of present assignment of future rights, all such
copyright, database rights, design rights (and any other Intellectual Property
capable of assignment by way of present assignment of future rights) which may
fall within the definition of the Intellectual Property Rights absolutely for
the full term of those rights.

16.3                           If and whenever required so to do by the Company the Executive shall at
the expense of the Company or such Group Company as the Company may direct:

(a)                                  apply or join with the Company or such Group Company in applying for
patent or other protection or registration in the United Kingdom and in any
other part of the world for any Intellectual Property Rights; and

 13
 

 

(b)                                 execute all instruments and do all things necessary for vesting all
Intellectual Property Rights (including such patent or other protection or
registration when so obtained) and all right, title and interest to and in them
absolutely, with full title guarantee and as sole beneficial owner, in the
Company or such Group Company or in such other person as the Company may
specify.

16.4                           The Executive irrevocably and unconditionally waives all rights under
Chapter IV of Part I Copyright Designs and Patents Act 1988 in
connection with his authorship of any existing or future copyright work in the
course of the Employment, in whatever part of the world such rights may be
enforceable including, without limitation:

(a)                                  the right conferred by section 77 of that Act to be identified as
the author of any such work; and

(b)                                 the right conferred by section 80 of that Act not to have any such
work subjected to derogatory treatment.

16.5                           The Executive irrevocably appoints the Company to be his Attorney in his
name and on his behalf to execute any such instrument or do any such thing and
generally to use his name for the purpose of giving to the Company the full
benefits of this clause.  A certificate
in writing in favour of any third party signed by any director or by the
Secretary of the Company that any instrument or act falls within the authority
conferred by this Agreement shall be conclusive evidence that such is the case.

16.6                           Nothing in this clause 16 shall be construed as restricting the
rights of the Executive or the Company under sections 39 to 43
Patents Act 1977.

17                                  Termination

17.1                           Notwithstanding any other provisions of this Agreement, in any of the
following circumstances the Company may terminate the Employment summarily by
serving written notice on the Executive to that effect.  In such event the Executive shall not be
entitled to any further payment from the Company except such sums as shall have
accrued due at the date of service of such notice. The circumstances are if the
Executive:

(a)                                  is guilty of any gross misconduct or gross incompetence;

(b)                                 commits any serious breach of this Agreement , or any wilful neglect or
unreasonable refusal to discharge his duties provided that if such breach is
capable of remedy, he shall have failed to remedy it within such reasonable
period as is specified in a written notice from the Company pointing out the
breach and requiring it to be remedied;

(c)                                  repeats or continues (after warning) any breach of this Agreement;

(d)                                 is guilty of any fraud, dishonesty or conduct tending to bring himself,
the Company or any Group Company into disrepute;

(e)                                  commits any act of bankruptcy or takes advantage of any statute for the
time being in force offering relief for insolvent debtors;

(f)                                    is convicted of any criminal offence (other than minor offences under
the Road Traffic Acts or the Road Safety Acts for which a fine or non-custodial
penalty is imposed) which might reasonably be thought to affect adversely the
performance of his duties;

(g)                                 is disqualified from holding office in the Company or in any other
company by reason of any order made under the Company Directors
Disqualification Act 1986 or any other enactment or is found to have committed
any serious disciplinary offence by any professional or other body, which
undermines the confidence of the Board in his continued employment with the
Company; or

 14
 

 

(h)                                 resigns other than at the request of the Company or otherwise ceases to
be or becomes prohibited by law from being a director of the Company, otherwise
than at the Company’s request.

Any delay by the Company in exercising such right of
termination shall not constitute a waiver of it.  The proper exercise by the Company of its
right of termination under this clause is without prejudice to any other rights
or remedies which it or any Group Company may have or be entitled to exercise
against the Executive.

17.2                           If at any time the Executive is unable to perform his duties properly
because of ill health accident or otherwise for a period or periods totalling
at least 12 months, or becomes incapable by reason of mental disorder of
managing and administering his property and affairs, then the Company may in
its absolute discretion terminate the Employment by giving him not less than
three months’ written notice to that effect provided that:

(a)                                  if at any time during the currency of such a notice the Executive shall
provide a medical certificate satisfactory to the Board to the effect that he
has fully recovered his physical and/or mental health and that no recurrence of
illness or incapacity can reasonably be anticipated, the Company shall withdraw
the notice unless, by that date, a replacement for the Executive has been
appointed; and

(b)                                 subject to and in accordance with the rules of the Pension Scheme, the
Executive qualifies for an early retirement pension by reason of Partial
Incapacity or Total Incapacity (as those terms are defined under the Pension
Scheme).

17.3                           If the Company believes that it may be entitled to terminate the
Employment, whether pursuant to clause 17.1 or otherwise, or if the
Company believes it is necessary in order to investigate a complaint against
the Executive, it shall be entitled (but without prejudice to its right
subsequently to terminate the Employment on the same or any other ground) to
suspend the Executive on full pay and exclude him from the Group’s premises for
so long as it may think fit.

17.4                           On the termination of the Employment or upon the Company having
exercised its rights under clause 3.7 or if requested to do so by the
Company in circumstances where the Executive has been prevented from performing
his duties through long term sickness (for a period of 12 months), the
Executive shall:

(a)                                  at the request of the Company resign from office as a director of the
Company and all offices held by him in any Group Company and shall transfer to
the Company without payment or as the Company may direct any qualifying shares
held by him as nominee for the Company provided however that such resignation
shall be without prejudice to any claims which the Executive may have against
the Company or any Group Company arising out of the termination of the
Employment; and

(b)                                 immediately deliver to the Company all materials within the scope of
clause 15.2, any Company car, mobile telephone or other Company equipment
in his possession and all keys, credit cards, and other property of or relating
to the business of the Company or of any Group Company which may be in his
possession or under his power or control but excluding, in the event that the
Company exercises its rights under clause 3.7, any Company car, mobile
telephone or other Company equipment provided to the Executive for his benefit
during the Employment

and the Executive
irrevocably authorises the Company to appoint any person in his name and on his
behalf to sign any documents and do any things necessary or requisite to give
effect to his obligations under this clause 17.4.

17.5                           If the Employment shall be terminated (otherwise than in circumstances
constituting a Corporate Change under clause 3.6) for the purpose of
reorganisation, reconstruction or amalgamation for whatever reason and the
Executive is offered employment with any concern or undertaking resulting from
such reorganisation, reconstruction or amalgamation on terms and conditions
which as a whole

 15
 

 

are no less
favourable than the terms of this Agreement, then he shall have no claim
against the Company in respect of the termination of the Employment.

17.6                           The Executive shall not at any time during any period when he is
required to cease the performance of his duties under clause 3.7 or after the
Termination Date make any public statement in relation to the Company or any
Group company or any of their officers or employees.  The Executive shall not without the Company’s
consent after the termination of the Employment represent himself as being
employed by or connected with the Company or any Group company.

18                                  Restrictive covenants

18.1                           The Executive will not (without the previous consent in writing of the
Board) for the period of 9 months immediately after the Termination Date
whether as principal or agent, and whether alone or jointly with, or as a
director, manager, partner, shareholder, employee or consultant of any other
person, firm, company or organisation directly or indirectly:

(a)                                  be engaged, concerned or interested in the businesses of Allied Domecq
Plc, Anheuser-Busch Cos Inc, Bacardi Limited, Brown-Forman, Carlsberg A/S,
Heineken NV, Inbev, Pernod-Ricard, SAB Miller or Scottish and Newcastle
Plc.  The Company may notify the
Executive from time to time of additions to the foregoing list of companies,
such additions being businesses which are similar to and compete with any
business being carried on by the Company or by any Group Company;

(b)                                 in competition with the Company or any Group Company negotiate with,
solicit business from or entice away from the Company or any Group Company (or
endeavour to do any of the foregoing) the business of any person, firm, company
or organisation who or which to his knowledge is and has been a customer of (or
who had regular business dealings with) the Company or with any Group Company
during the period of 12 months immediately preceding the Termination Date and
with whom he had direct dealings or personal contact or for whom he was
responsible on behalf of the Company or any Group Company in the course of the
Employment during that period, so as to harm the goodwill or otherwise damage
the business of the Company or of any other Group Company;

(c)                                  in competition with the Company or any Group Company undertake to
provide any service or manufacture or supply any product similar to those with
which he was concerned in the course of the Employment during the period of 12
months immediately preceding the Termination Date to or for any person who is
or was a customer or supplier to (or who had regular business dealings with)
the Company or any other Group Company during the period of 12 months
immediately preceding the Termination Date and with whom he had direct dealings
or personal contact or for whom he was responsible on behalf of the Company or
any Group Company in the course of the Employment during that period.

For the purposes of clauses 18.1(b) and clause
18.1(c), customer shall include any third party
with whom the Company or any Group Company was (during the said period) in
negotiation in respect of the provision of goods or services;

(d)                                 interfere or seek to interfere with the supply to the Company or any
Group Company of any goods or services by any supplier who during the period of
12 months immediately preceding the Termination Date shall have supplied goods
or services to the Company or any Group Company and with whom the Executive has
had business dealings, nor will he interfere or seek to interfere with the
terms on which such supply during such period as aforesaid has been made;

(e)                                  solicit or entice away or endeavour to solicit or entice away from the
Company or any Group Company any person who is an employee of or otherwise
works for the Company or any Group Company and:

(i)                                     who is at the Termination Date or was within the period of 12 months
immediately preceding that date part of the senior management of the Company or
any other Group Company; or

 16
 

 

(ii)                                  who by reason of their knowledge of trade secrets or confidential
information of the Company or any Group Company or knowledge or influence over
the clients, customers or suppliers of the Company or any Group Company is
likely to be able to assist or benefit a business which competes or proposes to
compete with the Company or any Group Company.

Provided
that this clause 18.1(e) shall only apply to employees with whom the Executive
had personal dealings in period of 12 months preceding the Termination Date;

(f)                                    employ or engage for the provision of work or services any person who is
an employee of or otherwise works for the Company or any Group Company and:

(i)                                     who is at the Termination Date or was within the period of 6 months
immediately preceding that date part of the senior management of the Company or
any other Group Company; or

(ii)                                  who by reason of their knowledge of trade secrets or confidential
information of the Company or any Group Company or knowledge or influence over
the clients, customers or suppliers of the Company or any Group Company is
likely to be able to assist or benefit a business which competes or proposes to
compete with the Company or any Group Company.

Provided that this clause 18.1(f) shall only apply to
employees with whom the Executive had personal dealings in period of 6 months
preceding the Termination Date.

18.2                           For the avoidance of doubt, none of the restrictions contained in
clause 18.1 shall prohibit any activities by the Executive which are not
in direct or indirect competition with any business being carried on by the
Company or any Group Company at the Termination Date.

18.3                           Nothing in clause 18.1 shall preclude the Executive from holding
(directly or through nominees) investments listed on the Official List of
London Stock Exchange plc or in respect of which dealing takes place in the
Alternative Investment Market or any recognised stock exchange as long as he
does not hold more than 3 per cent of the issued shares or other
securities of any class of any one company.

18.4                           At no time after the Termination Date shall the Executive directly or
indirectly represent himself as being interested in or employed by or in any
way connected with the Company or any Group Company, other than as a former
employee of the Company.

18.5                           The Executive agrees that, having regard to all the circumstances, the
restrictions contained in this clause are reasonable and necessary for the
protection of the Company or of any Group Company and that they do not bear
harshly upon him and the parties agree that:

(a)                                  each restriction shall be read and construed independently of the other
restrictions so that if one or more are found to be void or unenforceable as an
unreasonable restraint of trade or for any other reason the remaining
restrictions shall not be affected; and

(b)                                 if any restriction is found to be void but would be valid and
enforceable if some part of it were deleted, that restriction shall apply with
such deletion as may be necessary to make it valid and enforceable.

18.6                           The Executive hereby enters into covenants in the same terms as those
contained in clause 18.1 to 18.5 above which shall apply in the event that the
Company terminates the Executive’s employment unlawfully.

19                                  Disciplinary and grievance procedures

19.1                           If the Executive wishes to obtain redress of any grievance relating to
the Employment or is dissatisfied with any reprimand, suspension or other
disciplinary step taken by the Company, he may apply in writing to the
Chairman, setting out the nature and details of any such grievance or
dissatisfaction.

 17
 

 

The decision of
the Chairman shall be final.  The
provisions of this clause shall not apply in any event, to any action taken by
the Company under clause 17.1 or clause 3.7.

19.2                           There are no specific disciplinary rules which apply to the Executive
and any disciplinary matters affecting him will be dealt with by the
Chairman.  The decision of the Chairman
shall be final.

19.3                           The provisions of clauses 19.1 and 19.2 do not form part of the
Executive’s contract of employment.

20                                  Notices

20.1                           Any notice or other document to be given under this Agreement shall be
in writing and may be given personally to the Executive or to the Secretary of
the Company (as the case may be) or may be sent by first class post or other
fast postal service or by facsimile transmission to, in the case of the
Company, its registered office for the time being and in the case of the
Executive either to his address shown on the face of this Agreement or to his
last known place of residence.

20.2                           Any such notice shall (unless the contrary is proved) be deemed served
when in the ordinary course of the means of transmission it would first be
received by the addressee in normal business hours.  In the case of first class post, this shall
be deemed to be no later than two working days after posting. In proving such
service it shall be sufficient to prove, where appropriate, that the notice was
addressed properly and posted, or that the facsimile transmission was
despatched.

21                                  Former contracts of employment

21.1                           This Agreement shall be in substitution for any previous contracts,
whether by way of letters of appointment, agreements or arrangements, whether
written, oral or implied, relating to the employment of the Executive, which
shall be deemed to have been terminated by mutual consent as from the date of this
Agreement and the Executive acknowledges that he has no outstanding claims of
any kind against the Company or any Group Company in respect of any such
contract.

21.2                           For the avoidance of doubt, this clause shall not affect benefits which
have already accrued to the Executive prior to the date hereof under any
pre-existing scheme or arrangement by virtue of which he was entitled to
benefits.

22                                  Choice of law and submission to jurisdiction

22.1                           This Agreement shall be governed by and interpreted in accordance with
English law.

22.2                           The parties submit to the exclusive jurisdiction of the English courts
but this Agreement may be enforced by the Company in any court of competent
jurisdiction.

23                                  General

23.1                           The expiration or termination of this Agreement shall not prejudice any
claim which either party may have against the other in respect of any
pre-existing breach of or contravention of or non-compliance with any provision
of this Agreement nor shall it prejudice the coming into force or the
continuance in force of any provision of this Agreement which is expressly or
by implication intended to or has the effect of coming into or continuing in
force on or after such expiration or termination.

23.2                           No failure or delay by the Company in exercising any right, power or
privilege under this Agreement shall operate as a waiver thereof nor shall any
single or partial exercise by the Company of any right, power or privilege
preclude any further exercise thereof or the exercise of any other right, power
or privilege.

23.3                           There are no collective agreements directly affecting the Executive’s
employment.

23.4                           This Agreement constitutes the written statement of the terms of
employment of the Executive provided in compliance with Part I of the ERA.

 18
 

 

23.5                           A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Act 1999 to enforce any term of this
Agreement but this does not affect any right or remedy of a third party which
exists or is available apart from that Act.

 

	
  Executed as a deed by

  	
  )

  	
   

  	
  /s/ Lord Blyth

  	
   

  
	
  the Company

  	
  )

  	
   

  	
  Director

  
	
  acting by two
  directors or by a

  	
  )

  	
   

  	
   

  
	
  director and its
  secretary

  	
  )

  	
   

  	
  /s/ John Nicholls

  	
   

  
	
   

  	
  )

  	
   

  	
  Deputy Secretary

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Executed as a
  deed by

  	
  )

  	
   

  	
   

  
	
  the Executive

  	
  )

  	
   

  	
   

  
	
  in the presence
  of

  	
  )

  	
   

  	
  /s/ Paul S. Walsh

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  /s/ Gareth
  Williams

  	
   

  	
   

  	
   

  	
   

  
	
  Signature of
  witness

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name: Gareth
  Williams

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Address: 8
  Henrietta Place

  	
   

  	
   

  	
   

  
	
   

  	
  London

  	
   

  	
   

  	
   

  
								

 

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