Document:

Exhibit
4.6

 

	
  

  
	
   

  
	
   

  
	
  Rules of the Imperial Tobacco Group

  
	
  International Sharesave Plan

  
	
   

  
	
   

  
	
  Imperial Tobacco Group PLC

  

 

CONTENTS

	
  CLAUSE

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  DEFINITIONS

  	
   

  	
  1

  
	
  2.

  	
   

  	
  COMMENCEMENT AND TITLE

  	
   

  	
  4

  
	
  3.

  	
   

  	
  GRANT OF OPTION

  	
   

  	
  4

  
	
  4.

  	
   

  	
  LIMITATIONS ON THE ISSUE OF SHARES

  	
   

  	
  6

  
	
  5.

  	
   

  	
  EXERCISE PRICE

  	
   

  	
  7

  
	
  6.

  	
   

  	
  ALTERATIONS OF SHARE CAPITAL

  	
   

  	
  7

  
	
  7.

  	
   

  	
  EXERCISE OF OPTIONS

  	
   

  	
  8

  
	
  8.

  	
   

  	
  LAPSE OF OPTION

  	
   

  	
  9

  
	
  9.

  	
   

  	
  TAKEOVER AND LIQUIDATION

  	
   

  	
  10

  
	
  10.

  	
   

  	
  ALLOTMENT AND LISTING

  	
   

  	
  11

  
	
  11.

  	
   

  	
  EMPLOYMENT RIGHTS

  	
   

  	
  11

  
	
  12.

  	
   

  	
  ADMINISTRATION OF THE PLAN

  	
   

  	
  12

  
	
  13.

  	
   

  	
  TERMINATION OF THE PLAN

  	
   

  	
  14

  
	
  14.

  	
   

  	
  GENERAL

  	
   

  	
  14

  
	
   

  	
   

  	
   

  
	
  SCHEDULE 1

  	
   

  	
  15

  
	
  Special International Rules

  	
   

  	
  15

  
	
  Appendix 1

  	
   

  	
  16

  
	
  Appendix 2

  	
   

  	
  17

  
	
  Appendix 3

  	
   

  	
  18

  
	
  Appendix 4

  	
   

  	
  19

  
	
  Appendix 5

  	
   

  	
  23

  
	
  Appendix 6

  	
   

  	
  24

  
	
  Appendix 7

  	
   

  	
  27

  
	
  Appendix 8

  	
   

  	
  28

  
	
  Appendix 9

  	
   

  	
  29

  
	
  SCHEDULE 2

  	
   

  	
  33

  
	
  The Imperial Tobacco Group UK Sharesave Plan

  	
   

  	
  33

  
	
  SCHEDULE 3

  	
   

  	
  34

  
	
  The Imperial Tobacco Group Irish Sharesave Plan

  	
   

  	
  34

  
	
  SCHEDULE 4

  	
   

  	
  35

  
	
  Notional Awards

  	
   

  	
  35

  
	
  Appendix 1

  	
   

  	
  37

  
	
  Appendix 2

  	
   

  	
  38

  

 

1.                                           DEFINITIONS

In these Rules (unless the context otherwise requires)
the following words and expressions have the following meanings:

“Act” means the Income Tax (Earnings and Pensions) Act
2003;

“Adoption Date” means the date on which the Plan is adopted by the
Company in general meeting;

“ADS” means the American Depositary Shares, each
representing two Shares, evidenced by American Depositary Receipts, which may
be issued by Citibank, N.A., as depositary (the “Depositary”)
pursuant to the Amended and Restated Deposit Agreement, dated as of November 2,
1998, among the Company, the Depositary and all holders and beneficial owners
of American Depositary Shares thereunder;

“Application Period” means such period as the Board may, in its
discretion, determine but being a period not more than 60 days from an
Invitation Date (and, for the avoidance of doubt, the Board may apply different
Application Periods to Eligible Employees of Participating Companies in
different jurisdictions);

“Associated Company” means any company Controlling or under the Control of
the Company or which is Controlled by the same person or persons as Control the
Company;

“Auditors” means the auditors for the time being of the Company;

“Board” means the Board of Directors for the time being of
the Company (or the directors present at a duly convened meeting of such
Board), the Remuneration Committee of the Board or any other duly authorised
committee thereof;

“Commencement Date” means subject to the approval of the Plan by
shareholders in general meeting, such date as the Board shall, in its
discretion, determine;

“Companies Act 1985” means the Companies Act 1985 of England and Wales;

“Company” means Imperial Tobacco Group PLC;

“Continuous Service” means the aggregate amount of service with:

(a)                            any Participating Company (including service with such
company before it became a Participating Company); and

(b)                           any other company which is or was a Subsidiary
(including service with any such other company before it became a Subsidiary);

provided that:

(i)                              all such service has been continuous; and

(ii)                           in the case of an employee who is absent from such
employment for any reason for a period during which such employee’s contract of
service subsists, or by reason of maternity leave, and who then returns to such
employment, any such period of absence shall be deemed to have formed part of
such employee’s continuous service;

 1
 

“Control” means the power of a person to secure:

(a)                            by the holding of shares or possession of voting power
in or in relation to any company; or

(b)                           by virtue of any powers conferred by the articles of
association or other document regulating any company,

that
the affairs of any company are conducted in accordance with the wishes of that
person;

“Date of Grant” means the date on which the Grantor passes a
resolution to grant an Option under Rule 3.4 below;

“Eligible Employee” means any employee (including a director holding a
salaried employment or office) of a Participating Company who:

(a)                            on the relevant Date of Grant has achieved such period
of Continuous Service not exceeding five years as the Board shall in each case
on or before the Invitation Date determine;

(b)                           in the case only of a director holding a salaried
employment or office, usually works at least 25 hours per week excluding time
off permitted for meal breaks;

provided
that:

(i)                              at the Invitation Date no notice of termination of
such employment has been served by either the employee concerned or his
employing Participating Company and the employee or director in question has not
ceased to hold office or employment with a Participating Company; and

(ii)                           the Board may also treat any other employee or
director of a Participating Company, or worker contracted to provide services
on a temporary basis to a Participating Company, who fails to fulfil the
relevant criteria as an Eligible Employee;

“Employees’ Share Scheme” has the meaning given to it in section 743 of the
Companies Act 1985;

“Exercise Price” means the price per Share at which a Participant may
acquire Shares pursuant to the Plan (as determined in accordance with Rule 5);

“Grantor” means either the Board or the Trustee;

“Group” means the Company and its Subsidiaries from time to
time;

“Imperial Tobacco Group Sharesave
Scheme”
means the Imperial Tobacco Group Sharesave Scheme adopted on 14 August 1996, as
amended from time to time;

“Internal Reorganisation” means a compromise or arrangement or offer (including
the circumstances set out in Rule 9.2) which, in the reasonable opinion of the
Board, having regard to the shareholdings in the Company and any acquiring
company before and after the compromise or arrangement and/or the consideration
given for the acquisition of the Shares and/or any other matter which it
considers relevant, is in the nature of an internal reorganisation or
reconstruction of the Company;

“Invitation Date” means the date upon which invitations to apply for
Options are issued by the Board, being a date within 42 days after the
Commencement Date and thereafter within 28 days after the date of public announcement
of the annual or half-yearly results 

 2
 

of the Group or at any other time at which the board
resolves that it is appropriate to grant options;

“Local Currency Equivalent” means in relation to an amount denominated in GB
pounds sterling, the equivalent value in the local currency of a Participant’s
country of employment (or such other currency as the Board may permit from time
to time under the Savings Plan) at such exchange rate as the Board shall in its
discretion designate on or before the Invitation Date;

“London Stock Exchange” means the London Stock Exchange plc or any successor
company or body carrying on the business of the London Stock Exchange plc;

“Normal Repayment Date” means in relation to any Participant the first day of
the month following the date on which the Participant makes, or should have
made, the final specified contribution (as defined in Rule 3.3) to the Savings
Plan and for this purpose the starting date of the Savings Plan shall be the
first day of the month following that in which the first such specified
contribution is made to the Savings Plan;

“Option” means a right to acquire Shares, or ADSs, granted
pursuant to the Plan;

“Participant” means a person who holds a Subsisting Option or
(where the context admits) his personal representatives;

“Participating Company” means any member of the Group which the Board has
designated as such for the time being;

“Plan” means the Imperial Tobacco Group International
Sharesave Plan as amended from time to time;

“Relevant Multiple” means such number of monthly contributions to a
Savings Plan as the Board may, in its discretion, invite Eligible Employees to
make in connection with the grant of an Option under the Plan, and, where the
context admits or requires, the number of such contributions to which a
particular Participant shall have committed himself;

“Repayment” means in relation to a Savings Plan, the amount of
the contributions repayable and, where relevant, of any bonus and/or interest
payable under the Savings Plan;

“Rules” means these rules as from time to time amended in
accordance with their provisions by the Board or by the Company;

“Savings Plan” means any savings plan or arrangement which has been
approved by the Board in its absolute discretion for the purposes of the Plan;

“Schedule 3” means Schedule 3 to the Act;

“Share” means a fully paid ordinary share in the capital of
the Company;

“Specified Age” means 60;

“Subsidiary” means any company in relation to which the Company:

(a)                            holds a majority of the voting rights; or

(b)                           is a member and has the right to appoint or remove a
majority of its board of directors; or

(c)                            is a member and controls alone, pursuant to an
agreement with other shareholders or members, a majority of the voting rights
in it;

 3
 

and includes any other company which is a Subsidiary
as defined above of a company which is itself a Subsidiary of the Company;

“Subsisting Option” means an Option to the extent that it has neither
lapsed nor been exercised;

“Trustee” means the trustee or trustees for the time being of
any employee trust established by the Company wholly or partly for the benefit
of all or most of the persons for the time being employed by or holding office
with the Group or any Participating Company or Companies which has been
designated by the Board as a trust out of which Options may be granted.

Where the context so permits the singular shall
include the plural and vice versa and the masculine gender shall include the
feminine.  Any reference to a statutory
provision includes a reference to that provision as for the time being amended
or re-enacted and shall include any regulations or other subordinate
legislation made under it.

2.                                           COMMENCEMENT AND TITLE

The Plan shall commence on the Commencement Date and
shall be known as the Imperial Tobacco Group International Sharesave Plan.

3.                                           GRANT OF OPTION

3.1                                     On or prior to an Invitation Date the Board in its
absolute discretion or the employer of any Eligible Employee with the consent
of the Board may decide to invite applications for the grant of Options.  Such invitations shall be issued in such form
as the Board or, where the Board has consented to invitations being made by the
employer of an Eligible Employee, the employer of an Eligible Employee with the
consent of the Board may prescribe from time to time including by way of
electronic communication.

3.2                                     Where applications are invited, the Board shall
determine whether or not invitations shall be sent to all Eligible Employees
(and, for the avoidance of doubt, the Board may send or consent, in accordance with
Rule 3.1, to the sending of invitations to Eligible Employees of Participating
Companies in one jurisdiction but not to Eligible Employees of Participating
Companies in other jurisdictions) and any such invitations must state:

(a)                            the Exercise Price or the method by which the Exercise
Price for the Shares will be notified to Eligible Employees; and

(b)                           the date being the last day of the Application Period
by which applications for the grant of Options must have been received by the
Board or such person as the Board may direct being not more than 60 days after
the Invitation Date; and

(c)                            the Relevant Multiple or Multiples.

3.3                                     Applications for Options under the Plan shall be in
such form as the Board may prescribe from time to time and each:

(a)                            must be accompanied by a duly completed application
form to enter into a Savings Plan under which the applicant will agree to make
the Relevant Multiple of such specified contributions being not less than £5
(or its Local Currency Equivalent) per month or such other sum as the Board may
in its discretion determine nor (when aggregated with contributions made under
any other subsisting Savings Plan and/or under any other savings contract
linked to the Imperial Tobacco Group Sharesave Scheme) more than £250 (or its Local
Currency Equivalent) per month or such higher sum as may be permitted by
statute for UK Inland Revenue approved SAYE option schemes, from time to time
at the Invitation Date to secure on the Normal Repayment Date, as nearly as may
be, Repayments of an amount 

 4
 

equal to that for which Shares may be acquired under
his Option if exercised in full; and

(b)                           shall empower the Board or any person authorised by
it:

(i)                              to amend the amount of the specified contribution
referred to in Rule 3.3(a) above to such lesser sum as shall secure on the
Normal Repayment Date, as nearly as may be, Repayments of an amount equal to
that for which Shares may be acquired by the Participant in the event that the
number of Shares for which an Eligible Employee applies for an Option has to be
reduced in accordance with Rule 3.4 below;

(ii)                           to deduct from the Participant’s pay such contribution
as shall be specified by the Participant pursuant to Rule 3.3(a) above or as
may be amended pursuant to Rule 3.3(b)(i) above and pay the same on behalf of
the Participant in discharge of the Participant’s obligations under the Savings
Plan provided that where such deductions are not permissible under the laws or
regulations of the country of employment of a Participant the Board may, in its
discretion, require the Participant to furnish to the Board such evidence in
such form and manner as may be acceptable to it of the payment of such
contributions in accordance with the Savings Plan as shall be specified by the
Participant pursuant to Rule 3.3(a) or as may be amended pursuant to Rule
3.3(b)(i) above.

3.4                                     Within 60 days of the date pursuant to Rule 5.1(a)
below by reference to which the Exercise Price was determined (including the
case where the number of Shares over which an Option is to be granted is
determined by Rule 3.4(a) below) and subject to the limitations and conditions
contained in the Plan, Options shall by resolution of the Grantor be granted to
each Eligible Employee who has made a valid application in respect of that
number of Shares as would have an aggregate Exercise Price not exceeding the
Relevant Multiple of the sterling equivalent of the Eligible Employee’s
proposed monthly contributions to the Savings Plan as at the Invitation Date:

Save
that:

(a)                            the Board may (but shall not be obliged to) make such
adjustments to the number of Shares placed under an Option as it may in its
absolute discretion determine to be appropriate taking into account the actual
and anticipated rate of interest applicable to the Eligible Employee’s Savings
Plan contributions and the actual and anticipated rate of exchange between the
savings currency and sterling (if savings are expected to be retained in a
currency other than sterling) over the period of the savings contract and such
other factor or factors, if any, as the Board may consider to be relevant; and

(b)                           where the Board in its discretion considers that it is
desirable to limit the number of Shares in respect of which Options are granted
in relation to any invitation the monthly savings contribution chosen by each
applicant under the Savings Plan shall be reduced in such manner as the Board
may, in its discretion, determine (provided that all Eligible Employees shall
be treated on a similar basis without regard to differences among Eligible Employees
in respect of remuneration, length of service or any other factor) to the
extent necessary so as to reduce the aggregate number of Shares applied for to
or as near to as shall be practicable without exceeding the said limitation.

3.5                                     No payment will be required from a Participant on the
grant of an Option.  Each Participant
will be issued with a certificate in the form from time to time determined by
the Board.

 5
 

3.6                                     No Option shall be capable of being transferred by a
Participant.

3.7                                     No Option shall be granted more than ten years after
the Adoption Date.

3.8                                     The reference in Rule 3.4 above to the sterling
equivalent of any amount means the sterling equivalent determined by the Board
by reference to such published rate of exchange between GB pounds sterling and
the relevant currency as may be available to the Board on or about the
Invitation Date and which the Board determines in its discretion to be
appropriate.

3.9                                     The Board may (but shall not be obliged to) invite
those Participants whose contributions to a Savings Plan are made in a local
currency to adjust the rate at which they contribute to the Savings Plan at any
time and from time to time during the life of that Savings Plan if the Board
considers that it may be in the interests of those Participants to do so in the
light of relative rates of exchange, interest rates or any other factor.  No Participant shall be obliged to adjust the
rate of contribution should the opportunity to do so be offered.

3.10                               Where an Eligible Employee does not receive an
application for Options and/or any other information connected with any such
application as a result of an accidental act or omission on the part of the
Board or any person authorised by it in relation to the issue and/or
distribution of such documents, that shall not affect the validity of any other
matters pertaining to the Plan.

3.11                               For the purposes of Rules 3.1 and 3.2 above, an
invitation shall be sufficiently given if delivered to an Eligible Employee
personally or sent to him at his place of work by electronic mail or facsimile
transmission or sent by prepaid post addressed to the Eligible Employee at his
address last known to the Company (including any address supplied by the
relevant Participating Company or any Subsidiary as being his address) or sent
through the Company’s internal postal service and such application made
pursuant to an invitation shall be sufficiently given if returned to the
Company or its duly appointed agent in person or sent by electronic mail or
facsimile transmission to the Company or its duly appointed agent or sent by
prepaid post addressed to the Company or returned to the Company through the
Company’s internal postal service duly completed by the Eligible Employee on or
before such date as shall be specified in the invitation but in any event no
application shall be duly received until the original signed application is
actually received by the Company or its duly appointed agent prior to the
expiry of the Application Period (unless the Company directs otherwise).

4.                                           LIMITATIONS ON THE ISSUE OF SHARES

Subject to Rule 6 below, no Option shall be granted on
any Date of Grant or proposed Date of Grant if, as a result:

(a)                            the aggregate number of Shares (including Shares
represented by ADSs) acquired or which may be acquired during the ten years
preceding such Date of Grant under the Plan and all other Employees’ Share
Schemes established by the Company would exceed ten per cent. of the issued
ordinary share capital of the Company on that Date of Grant; or

(b)                           the aggregate number of Shares (including Shares
represented by ADSs) acquired or which may be acquired during the preceding
five years under the Plan and all other Employees’ Share Schemes would exceed
five per cent. of the issued ordinary share capital of the Company on that Date
of Grant;

provided that, for the avoidance of doubt, Shares
(including Shares represented by ADSs) which shall have been the subject of
grants which lapse shall not be taken into account for the purposes of this
Rule 4.

 6
 

5.                                           EXERCISE PRICE

5.1                                     Subject to Rule 6 below, the Exercise Price shall be
such amount expressed in GB pounds sterling (or in such other currency or
currencies as the Board shall specify) in the case of Options for Shares as the
Board shall determine being an amount not less than the greater of:

(a)                            subject to Rule 5.2 below, 80 per cent. of the middle
market quotation per Share as derived from the Daily Official List of the
London Stock Exchange for the dealing day immediately preceding the Invitation
Date; and

(b)                           in the case only of an Option to subscribe for Shares,
the nominal value of a Share.

5.2                                     For the purposes of an Option granted at any time at
which there shall be no dealings in the Shares, the Exercise Price shall be not
less than 80 per cent. of such sum as may be determined by the Board to be the
market value of a Share at that time.

5.3                                     For the avoidance of doubt, the Board may set a
different Exercise Price for Eligible Employees of Participating Companies in
one jurisdiction from those of another jurisdiction notwithstanding that
invitations may be sent out to all such Eligible Employees on the same
Invitation Date, but any such Exercise Price must fulfil the requirements of
Rule 5.1 above.

6.                                           ALTERATIONS OF SHARE CAPITAL

In the event of:

(a)                            any variation in the share capital of the Company
whether by way of capitalisation of profits or reserves or by way of rights or
any consolidation or sub-division or reduction of capital, or otherwise;

(b)                           the Company paying a capital dividend;

(c)                            a demerger of any company within, or business owned
by, the Group; or

(d)                           in any other circumstances similarly affecting Options
granted under the Plan;

then the number of Shares subject to any Subsisting
Option, the Exercise Price and, where an Option has been exercised but, as at the
date of the variation of capital referred to above, no Shares have been
allotted or transferred pursuant to such exercise, the number of Shares which
may be so allotted or transferred and the price at which they may be acquired,
may be adjusted by the Board in such manner and with effect from such date as
the Board may determine to be appropriate provided always that:

(i)                               no such adjustment shall take effect until it has been
referred to the Auditors and the Auditors have certified in writing to the Board
that the adjustment is, in their opinion, fair and reasonable; and

(ii)                            the Exercise Price of an Option to subscribe for
Shares shall not be adjusted below the nominal value of a Share unless:

(A)                        the Board is authorised to capitalise from the
reserves of the Company a sum equal to the amount by which the nominal value of
the Shares subject to the Option exceeds the aggregate adjusted Exercise Price;
and

(B)                          the Board shall resolve to capitalise and apply such
sum on exercise of that Option.

 7
 

7.                                           EXERCISE OF OPTIONS

7.1                                     The extent to which an Option may be exercised shall
be:

(a)                            where exercise takes place on or after the Normal
Repayment Date related to the Option, in full or at the Board’s discretion, in
part; and

(b)                           where exercise takes place earlier than the Normal
Repayment Date related to the Option (the “Early Exercise Date”),
in respect of such number of shares as may be acquired with the number of
specified contributions (plus any interest accrued under the Savings Plan)
which shall have been made on or before such Early Exercise Date, subject to
the maximum number of Shares under Option.

7.2                                     An Option shall be exercisable during the period
mentioned in Rule 7.4 below in respect of all or some of the Shares over which
it was granted by the Participant delivering to the Secretary of the Company at
its registered office (or otherwise as may be notified to Participants from
time to time) a written notice in the form prescribed by the Board from time to
time specifying the number of Shares in respect of which the Option is
exercised together with a remittance for that number of Shares calculated by
reference to the Exercise Price.  The
date of exercise of the Option shall be the date of receipt by the Company or
the Trustee (acting as agent of the Company) of such notice and payment.

7.3                                     It is a condition of the exercise of an Option under
the Plan that the Participant shall withdraw all sums due by way of Repayment
under the Savings Plan to which he has contributed in relation to the
Option.  If upon the exercise of an
Option the Repayment then due to a Participant under his Savings Plan is less
than the amount required to pay for all the Shares in respect of which it may
be exercised pursuant to Rule 7.1 above the Participant may add to the
Repayment up to a maximum of such sum as shall be necessary to pay for all such
Shares.  If the Repayment shall exceed
the amount required to exercise the Option to the extent possible (or to the
extent to which it is in fact exercised, if lower) such excess shall be paid to
the Participant provided that if the excess is less than the Exercise Price per
Share or such lower sum as the Board may determine such excess may be donated
to such charity or charities as the Board may in its discretion determine.

7.4                                     Save as otherwise provided, an Option may not be
exercised until the Normal Repayment Date. 
Subject only to the provisions of Rule 7.7 below, no Option may be
exercised later than six months after the Normal Repayment Date.

7.5                                     An Option shall cease to be exercisable upon the
Participant ceasing to be an employee or director of any member of the Group
(so as to hold no such employment or office) except where his so ceasing is by
reason of:

(a)                            his retirement on reaching the Specified Age or such
other age at which he is bound to retire in accordance with the terms of his
employment; or

(b)                           injury, disability or redundancy or his office or
employment either being in a company which ceases to be a Subsidiary or
relating to a business or part of a business which is transferred to a person
who or which is neither a Subsidiary nor a Group company; or

(c)                            his leaving service at any time other than at a time
specified in sub-paragraph (a) or (b) above, provided that such event occurs
not earlier than three years from the Date of Grant of the Option;

in any of which circumstances the Option may be
exercised at any time during the period of six months from the date on which he
so ceases to be an employee or director of any member of the Group
notwithstanding that the Normal Repayment Date shall not have occurred.

 8
 

7.6                                     For the purposes of Rule 7.5 above and Rule 9 below
(but for no other purpose):

(a)                            a Participant shall not be regarded as having ceased
to hold office or employment by reason of:

(i)                              his being or becoming employed by a company which
ceases to be or is not a Participating Company but is nevertheless an
Associated Company or is under the Control of the Company; or

(ii)                           his ceasing to be employed full-time but continuing to
be employed on a part-time basis; and

(b)                           a Participant shall be regarded as ceasing to hold
office or employment when he holds no employment with any of the Company, any
Associated Company and any company Controlled by the Company.

7.7                                     In the event of the death of a Participant prior to
the Normal Repayment Date the Option may be exercised by his personal
representatives at any time during the period of twelve months commencing on
the date of his death (but not later) and the personal representatives shall be
entitled to do so notwithstanding that the Normal Repayment Date has not
occurred and in the event of the death of a Participant within six months
commencing on the Normal Repayment Date his personal representatives may
exercise the Option at any time within twelve months commencing on the Normal Repayment
Date.

7.8                                     A Participant who reaches the Specified Age prior to
the Normal Repayment Date but continues to hold the office or employment by
virtue of which he is eligible to participate in the Plan may exercise the
Option within six months after the date of his reaching the Specified Age.

7.9                                     If an Option becomes exercisable under any provision
of the Plan before the Normal Repayment Date it shall be exercisable only to
the extent permitted by Rules 7.1 and 7.3 above.  The Repayment made under the Savings Plan
entered into on the grant of an Option shall exclude any contributions made
direct by the Participant except to the extent that such are made pursuant to
any special arrangements relating to absence from employment or to the extent
permitted by the Board.  For the
avoidance of doubt, any Repayment under the Savings Plan shall exclude the
Repayment of any contributions made in advance under the Savings Plan the due
date for payment of which falls or would have fallen more than one month after
the date on which Repayment is made.

7.10                               An Option shall be exhausted and automatically
cancelled immediately after it is first exercised notwithstanding that it shall
not have been exercised in respect of all of the Shares over which the Option
was granted.

8.                                           LAPSE OF OPTION

A Participant’s Option shall lapse and cease to be
exercisable:

(a)                            upon the expiry of any of the periods for exercise
under the provisions of Rule 7 above and Rule 9 below, whichever shall first
occur;

(b)                           if the Participant omits seven or more times to make a
monthly payment due under his Savings Plan or gives notice under the Savings
Plan requiring Repayment before the Normal Repayment Date unless such
non-payment or notice is in consequence of his ceasing to be an Eligible
Employee by virtue of one of the causes mentioned in Rules 7.5 or 7.7 above or
in the circumstances of Rules 7.8 above or Rule 9 below; or

 9
 

(c)                            if the Participant makes payments to a bank account
under his own control and fails to provide evidence as specified by the Board
that all contributions have been made to, and no withdrawals have been made
from, the account.

9.                                           TAKEOVER AND LIQUIDATION

9.1                                     If any person obtains Control of the Company as a
result of making:

(a)                            a general offer to acquire the whole of the issued
share capital of the Company (not otherwise held or contracted to be acquired
by the offeror) which is made on a condition such that if it is satisfied the
person making the offer will have Control of the Company; or

(b)                           a general offer to acquire all the shares in the
Company which are of the same class as the Shares (including the Shares
represented by ADSs);

then any Subsisting Option may be exercised within six
months of the time when the person making the offer has obtained Control of the
Company and any condition subject to which the offer is made has been
satisfied.

9.2                                     If under section 425 of the Companies Act 1985 the
Court sanctions a compromise or arrangement scheme which leads to a third party
obtaining the ultimate control of the Company, any Subsisting Option may be
exercised within six months of the Court sanctioning the compromise or
arrangement provided that this Rule 9.2 shall not apply in the circumstances of
an Internal Reorganisation, unless the Acquiring Company fails to make an offer
to Participants to release Subsisting Options in accordance with Rule 9.4 below
within one week of the Court’s sanction under this Rule and in which case this
Rule shall apply as if the Court had sanctioned the scheme on the day following
the end of the period of one week mentioned above.

9.3                                     If any person becomes bound or entitled to acquire
shares in the Company under sections 428 to 430 of the Companies Act 1985 any
Subsisting Option may be exercised at any time when that person remains so
bound or entitled.

9.4                                     If as a result of the events specified in Rules 9.1 or
9.2 above a company has obtained Control of the Company, or if a company has
become bound or entitled as mentioned in Rule 9.3 above, any Participant may by
agreement with that other company (the “Acquiring Company”)
within the Appropriate Period as defined in paragraph 38(3) of Schedule 3
release any Subsisting Option of his in consideration of the grant of a new
Option (the “New Option”) which satisfies the
following conditions:

(a)                            the New Option shall be over shares in the Acquiring
Company or another company which satisfies paragraph (b) or (c) of paragraph 18
of Schedule 3 in relation to the Acquiring Company and shall satisfy the
conditions specified in paragraphs 18 to 22 inclusive of Schedule 3;

(b)                           the New Option shall be a right to acquire such number
of such shares in the Acquiring Company (or such other company) as shall have
on the grant of the New Option an aggregate market value equal to the aggregate
market value of the Shares subject to the Option immediately before its release
and for this purpose market value shall be ascertained by the application of
Rule 5.1(a) above as at the date of release of the Option and grant of the New
Option;

(c)                            the New Option shall have an Exercise Price such that
the aggregate price payable on complete exercise equals the aggregate price
which would have been payable on complete exercise of the Option; and

(d)                           the New Option shall be otherwise identical in terms
to the Option

 10
 

AND the New Option shall, for all other purposes of
this Plan, be treated as having been acquired at the same time as the Option in
consideration of the release of which it is granted.  With effect from the release of any Option
pursuant to Rules 6, 7.1, 7.2 and 7.3, this Rule 9 and Rule 10 of this Plan
shall in relation to the New Option be construed as if references therein to
“the Company” were references to the Acquiring Company or, as the case may be,
such other company and all the Rules (other than Rules 3 to 5 inclusive) shall
in relation to the New Option be construed as if references therein to Shares
were references to shares in the Acquiring Company or, as the case may be, such
other company in respect of whose shares the New Option is granted.

9.5                                     If the Company passes a resolution for voluntary
winding up, any Subsisting Option may be exercised within six months of the
passing of the resolution.

9.6                                     For the purposes of this Rule 9 a person shall be
deemed to have obtained Control of a Company if he and others acting in concert
with him have together obtained Control of it.

9.7                                     The exercise of an Option pursuant to the preceding
provisions of this Rule 9 shall be subject to the provisions of Rule 7 above.

9.8                                     Any Option shall lapse if:

(a)                            it shall not have been exercised by the expiry of any
time limit for exercise set out in this Rule 9, whichever shall expire first;
and

(b)                           no agreement for the release of the Option shall have
been entered into by the expiry of the first Appropriate Period to commence
pursuant to Rule 9.4 above.

10.                                     ALLOTMENT AND LISTING

10.1                               Subject to receipt of the appropriate remittance and
notice of exercise, Shares to be acquired pursuant to the exercise of an Option
will be allotted or transferred not later than 45 days after the exercise of the
Option and will rank pari passu in all respects with the Shares in issue on the
date of exercise save that they will not rank for any dividend or other
distribution paid or made by reference to the date (known as the record date)
on which entitlement to the dividend or distribution is fixed by reference to
the Company’s register of members if that date falls prior to the date of
exercise of the Option.

10.2                               If the Shares are listed on the London Stock Exchange
at the date of allotment of any Shares pursuant to the Plan the Company will
apply to the London Stock Exchange for permission for such Shares so allotted
to be admitted to the Official List.  An
application may be postponed at the discretion of the Board until application
can be made in respect of such number of Shares as the Board consider
appropriate.

11.                                     EMPLOYMENT RIGHTS

11.1                               This Plan shall not form part of any contract of
employment between any member of the Group and any employee of any such company
and the rights and obligations of any individual under the terms of his office
or employment with any member of the Group shall not be affected by his
participation in the Plan or any right which he may have to participate
therein.

11.2                               Participation in the Plan shall be on the express
condition that:

(a)                            neither it nor cessation of participation shall afford
any individual under the terms of his office or employment with any member of
the Group any additional or other rights to compensation or damages;

(b)                           no damages or compensation shall be payable in
consequence of the termination of such office or employment (whether or not in
circumstances giving rise to a claim 

 11
 

for wrongful or unfair dismissal) or for any other
reason whatsoever to compensate him for the loss of any rights the Participant
would otherwise have had (actual or prospective) under the Plan howsoever
arising but for such termination; and

(c)                            the Participant shall be deemed irrevocably to have
waived any such rights to which he may otherwise have been entitled.

11.3                               No individual shall have any claim against a member of
the Group arising out of his not being admitted to participation in the Plan
which (for the avoidance of all if any doubt) is governed entirely by the Rules
of the Plan.

11.4                               No Participant shall be entitled to claim compensation
from any member of the Group in respect of any sums paid by him pursuant to the
Plan or for any diminution or extinction of his rights or benefits (actual or
otherwise) under any Option held by him consequent upon the lapse for any
reason of any Option held by him or otherwise in connection with the Plan and
each member of the Group shall be entirely free to conduct its affairs as it
sees fit without regard to any consequences under, upon or in relation to the
Plan or any Option or Participant.

11.5                               By accepting the grant of an Option under the Plan,
the Eligible Employee shall authorise and consent to the collection,
processing, transfer (including to countries outside the European Economic
Area) and retention of his personal data for use in connection with the
operation and implementation of the Plan by the Company, any Member of the
Group, the Trustee and/or any third party as may be retained by the Board from
time to time to administer the Plan.

12.                                     ADMINISTRATION OF THE PLAN

12.1                               The Board may make and vary such regulations (not
being inconsistent with the Plan) as it thinks fit for the administration and
implementation of the Plan.  The Board’s
decision on any matter concerning the Plan or its interpretation (including the
rectification of errors or mistakes of procedure or otherwise) (other than a
matter to be certified by the Auditors) shall be final and binding.  In any matter in which they are required to
act hereunder, the Auditors shall be deemed to be acting as experts and not as
arbitrators and their decision shall be binding and final.

12.2                               The Board shall be entitled by resolution to amend all
or any of the provisions of the Plan as the Board thinks fit except that no
alteration shall be made:

(a)                            to the advantage of Participants to any of the
provisions of the Plan relating to:

(i)                              eligibility;

(ii)                           the limitations on the number or amount of Shares,
cash or other benefits subject to the Plan;

(iii)                        the maximum entitlement of any one Participant;

(iv)                       the basis for determining a Participant’s entitlement
to, and the terms of, Shares, cash or other benefits to be provided under the
Plan and for the adjustment thereof (if any) in the event of a capitalisation
issue, rights issue or open offer, sub-division or consolidation of Shares or reduction
of capital or any other variation of capital;

without the prior sanction of an ordinary resolution of the Company in
general meeting except for minor amendments to benefit the administration of
the Plan and amendments to obtain or maintain favourable tax, exchange control
or regulatory treatment for Participants in the Plan or for any member of the
Group; or

 12
 

(b)                           to any rights already accrued to any Participant which
would be to the disadvantage of such Participant, without the prior consent of
the majority of the affected Participants first having been obtained.

12.3                               Written notice of any alteration made in accordance
with Rule 12.2 above shall be given to all Participants.

12.4                               The Company shall keep available sufficient issued
and/or unissued Shares (including Shares to be represented by ADSs) in the
capital of the Company to satisfy the exercise in full of all Options for the
time being remaining capable of being exercised.

12.5                               Participants shall be sent copies of any document
having a material effect on their rights at the same time as such document is
sent to holders of Shares.

12.6                               Unless otherwise provided in these Rules, any notice
or other communication under or in connection with the Plan may be given:

(a)                            by the Company to an Eligible Employee or Participant
either personally or sent to him at his place of work by electronic mail or by
post addressed to the address last known to the Company (including any address
supplied by the relevant Participating Company or any Subsidiary) or sent through
the Company’s internal postal service; and

(b)                           to the Company either personally or by post to the
Company Secretary (or its duly appointed agent).

Items sent by post shall be pre-paid and shall be
entirely at the Eligible Employee’s risk. 
Any notice or other communication to the Company shall not be deemed to
have been duly received until it is actually received by the Company or its
duly appointed agent (unless the Company directs otherwise).

12.7                               The Company shall bear the costs of setting up and administering
the Plan.  However, the Company may
require any Participating Company to reimburse the Company for any costs borne
by the Company directly or indirectly in respect of such Participating
Company’s officers or employees.

12.8                               The Company shall maintain all necessary books of
account and records relating to the Scheme.

12.9                               The Board shall be entitled to authorise any person to
execute on behalf of a Participant, at the request of the Participant, any
document relating to the Plan, in so far as such document is required to be
executed pursuant hereto.

12.10                         If any Option certificate shall be worn out, defaced
or lost, it may be replaced on such evidence being provided as the Board may
require.

12.11                         The provisions of the Company’s Articles of Association
for the time being in force with regard to the service of notices upon members
of the Company shall apply mutatis mutandis to any notice to be given by the
Company to Participants.

12.12                         Notwithstanding anything to the contrary contained
herein, the Board may at any time and from time to time by resolution and
without further formality amend the Plan in such manner as the Board may
consider necessary or desirable in order to comply with, take advantage of, or
otherwise in connection with any taxation, legal, regulatory or other rule,
law, guideline, regulation or other provision of or prevailing in any
jurisdiction in which this Plan is or is intended to be operated provided that
no such amendment shall be made to the advantage of Participants save as specified
in Rule 12.2(a) above without the prior approval of the Company in general
meeting.

 13
 

13.                                     TERMINATION OF THE PLAN

The Plan may be terminated at any time by the Board or
by the Company in general meeting but in any event shall terminate on the tenth
anniversary of the Adoption Date and on such termination no further Options
shall be granted, but the subsisting rights of Participants shall not be
affected by such termination.

14.                                     GENERAL

14.1                               Any Participating Company may provide money to the
Trustee or any other person authorised by the Board to enable them or him to
acquire Shares to be held for the purposes of the Plan, or enter into any
guarantee or indemnity for those purposes, to the extent not prohibited by
section 151 of the Companies Act 1985.

14.2                               The Plan shall be subject to, governed and construed
in accordance with English law and for the avoidance of doubt, notwithstanding
any translation of the Plan rules, the English version of the Plan rules shall
prevail at all times.

14.3                               The Company, the Trustee or any person which is or was
a Participant’s employer may withhold any amount and make any arrangements it
considers necessary to meet any liability of the Participant to taxation or
social security contributions in connection with the benefits delivered under
the Plan. These arrangements may include the sale on behalf of the Participant
of any Shares acquired by a Participant under the Plan. It is a condition of
the exercise of any Option that the Participant agrees to any withholding or other
arrangement (including, for the avoidance of doubt, any sale of Shares on
behalf of the Participant) in accordance with this Rule 14.3.

 14

SCHEDULE 1

Special
International Rules

The Rules of the Plan apply with and subject to the
following amendments and provisions which have been adopted by the Board
pursuant to Rule 12.7 for the purposes of the operation of the Plan in the
jurisdictions specified below:

Australia (Appendix 1)

Bosnia (Appendix 2)

Czech Republic (Appendix 3)

France (Appendix 4)

Germany (Appendix 5)

Italy (Appendix 6)

Netherlands (Appendix 7)

New Zealand (Appendix 8)

United States (Appendix 9)

The Rules of the Plan apply in the jurisdictions
specified below:

Greece

Hong Kong

Hungary

Kyrgyz Republic

Russia

Singapore

Slovakia

Slovenia

Spain

Taiwan

Turkey

United Arab Emirates

 15
 

Appendix
1

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR AUSTRALIA

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any Option granted or to be
granted to a person resident for tax purposes in Australia.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 1
except as otherwise provided.

Rule 1

	
  “Specified Age”

  	
  in Rule 1 shall be deleted.

  
	
   

  	
   

  
	
  Rule 7.5(a)

  	
  delete the words “on reaching Specified Age or such
  other age at which he is bound to retire in accordance with the terms of his
  employment”.

  
	
   

  	
   

  
	
  Rule 7.8

  	
  shall be deleted and Rules 7.9 and 7.10 and any
  references thereto shall be re-numbered accordingly.

  

 

Any
grant made pursuant to Rule 3 of the Plan shall, notwithstanding anything to
the contrary contained in the Plan, be a grant of that number of Options, each
being an option to acquire one Share, as may be determined by the Board and any
reference in the Plan to ‘an Option’ shall, where the context requires, be
deemed to be a reference to such Options and so that:

(a)                            the number of such Options shall, for the purposes of
Rule 3.4, be that number as would have an aggregate Exercise Price not
exceeding the Relevant Multiples of the sterling equivalent of the Eligible
Employee’s proposed monthly contributions to the Savings Plan as at the
invitation date;

(b)                           if any adjustment is to be made by the Board pursuant
to Rule 6 of the Plan, the Board may, in its discretion, cancel any subsisting
Options granted to any relevant employee (whereupon any such Options shall lapse),
may amend the price at which any Subsisting Option may be exercised or may
arrange for the grant to any Participant of additional Options on such terms as
to maturity and exercise price as the Board shall determine, subject always to
the proviso in Rule 6;

(c)                            for the purposes of Rule 7.2 of the Plan, all or some
of the Options may be exercised by the Participant on the terms set out in that
Rule 7.2;

(d)                           Rule 7.10 of the Plan shall be deleted and replaced
with the following:

“7.10                         An Option shall be exhausted and automatically
cancelled immediately after any of the Options are first exercised
notwithstanding that all Options granted shall not have been exercised.”; and

(e)                            subject always to the conditions in Rule 9.4, any
grant of a New Option for the purposes of Rule 9.4 of the Plan shall also be
deemed to be a grant of such number of New Options as shall give the employees
a right to acquire the total number of shares in the Acquiring Company
calculated in accordance with paragraph (b) of that Rule.  Any references to a new Option in that Rule
9.4 shall be deemed to be a reference to the New Options.

 

 16
 

Appendix
2

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR BOSNIA

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any Option granted or to be
granted to a person resident for tax purposes in Bosnia.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 2
except as otherwise provided

Rule 1

	
  “Specified Age”

  	
  shall be amended by deleting “60” and replacing it
  with “65 years and 20 years of paying social security and pension
  contributions (the “insurance record”)
  or 40 years of insurance record regardless of the age, unless otherwise
  agreed between the Participant and his employer;”

  

 

 17
 

Appendix
3

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR CZECH REPUBLIC

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any Option granted or to be
granted to a person resident for tax purposes in the Czech Republic.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 3
except as otherwise provided.

	
  Rule 3.3(b)

  	
  this rule shall be
  deleted and replaced with 

  “shall include an
  undertaking of the Participant to execute an agreement with his/her employer
  on deductions from such Participant’s salary (“Agreement
  on Deductions”) subject to the confirmation of the eligibility of
  the Participant by the employer. The Agreement on Deductions shall further
  include a joint obligation of the contracting parties to conclude an
  amendment to the Agreement on Deductions in the event of any of the circumstances
  specified in Rule 3.4. In particular, in the event that the number of Shares
  for which an Eligible Employee applies for an Option has to be reduced in
  accordance with Rule 3.4, the parties shall be required under this provision
  to conclude an amendment regarding reduction of the amount of regular monthly
  deductions from salary without undue delay of their notification in writing
  by the Company that such reduction has been approved by the Board.”

  

 

 18
 

Appendix
4

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR FRANCE

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified so as to conform with articles L225-177 to L225-186 of
the French Code de Commerce as amended (the “Code”)
and an administrative regulation (the “Instruction”)
dated 6 May 1988, reference N-3-88 and various articles of the French Tax Code,
to the extent required under French law in order to: (i) ensure that Options
may be granted to Eligible Employees who are French residents for tax purposes
(“French Eligible Employees”) under the
Plan; and (ii) obtain the most favourable tax and social security treatment of
the Plan available under French law from the perspective of the Group and any
French Eligible Employee.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 4
except as otherwise provided.

Rule 1

	
  “Eligible Employee”

   

  	
  Sub-paragraph (ii) shall be deleted and replaced
  with the following:

   

  “and the employee does
  not own on the relevant Date of Grant more than ten per cent. of the share
  capital of the Company”;

  
	
   

  	
   

  
	
  “Participant” 

  	
  shall be amended by deleting the words “personal
  representatives” and replacing them with the words “héritiers (heirs)”;

  
	
   

  	
   

  
	
  “Specified Age” 

  	
  shall be deleted;

  
	
   

  	
   

  
	
  “Subsidiary” 

  	
  the following paragraph shall be added to this
  definition;

   

  “Furthermore, a French
  company will only be deemed to be a subsidiary if, in addition to the
  conditions set out above, it is a company in which the Company holds directly
  or indirectly, at least ten per cent. of the share capital and/or voting
  rights”;

  
	
   

  	
   

  
	
  Rule 3.4

  	
  shall be amended by deleting the words “60 days of
  the date pursuant to Rule 5.1(a) below by reference to which the Exercise
  Price was determined” and replacing them with the words “Within 60 days of
  the dealing day immediately preceding the Invitation Date”;

  
	
   

  	
   

  
	
  Rule 3.7

  	
  shall be amended to read:

   

  “No Option will be
  granted more than 38 months after the Adoption Date.  No Option will be granted (i) during the
  period of 20 dealing days on the London Stock Exchange immediately following
  the payment of any cash dividend or stock dividend or the record date for any
  such dividend, (ii) during the ten dealing days on the London Stock Exchange
  both preceding and following the date on which the consolidated accounts of
  the Company (or if consolidated accounts are not drawn up, the annual
  accounts) are made public, and (iii) during the period elapsing between the
  date on which the corporate bodies of the Company are made aware of
  information which, if made public, could have a significant impact on the
  market price of the shares of the Company, and the date which is ten dealing
  days after the date on which such information is made public.”;

  

 

 19
 

 

	
  Rule 5.1(a)

  	
  shall be deleted and replaced with the following
  wording:

   

  “subject to Rule 5.2,
  80 per cent. of the average middle market quotation per Share as derived from
  the Daily Official List of the London Stock Exchange for the 20 dealing days
  immediately preceding the Date of Grant.”; and

  
	
   

  	
   

  
	
  Rule 5.2

  	
  shall be deleted and replaced with the following
  wording:

   

  “For the purposes of an
  Option granted at any time at which there shall be no dealings in the Shares,
  the Exercise Price shall be not less than such sum as may be determined by
  the Board, in accordance with the valuation rules set forth in article
  L225-177 of the Code, to be the market value of a Share on the Date of
  Grant.”; 

  
	
   

  	
   

  
	
  Rule 6

  	
  shall be deleted and replaced with the following wording:

   

  “In principle the
  Exercise Price shall not be modified during the life of the Option.  However, in the event of any alteration in
  the issued share capital of the Company (whether by way of capitalisation of
  profits or reserves or any sub-division or reduction of capital, or any other
  operation envisaged by article L225-181 of the Code), then the number of
  Shares subject to any Subsisting Option and the Exercise Price may be
  adjusted by the Board in such manner and with effect from such date as the Board
  may deem appropriate in order to comply with article L225-181.”;

  
	
   

  	
   

  
	
  Rule 7.5

  	
  shall be deleted and replaced with the following:

   

  “An Option shall cease
  to be exercisable upon the Participant ceasing to be an employee or director
  of any member of the Group (so as to hold no such employment or office)
  except where his so ceasing is by reason of any of the following
  circumstances:

   

  (a)   redundancy (licenciement pour
  motif économique);

  (b)   his being required by his
  employer to take retirement (mise à la retraite), or his taking retirement,
  in both cases, in circumstances where he is entitled to a full pension
  (retraite à taux plein) and has reached an age at which he is entitled to
  exercise his pension rights (l’âge d’ouverture des droits à la retraite);

  (c)   invalidity corresponding to
  the second or third category specified in article L341-4 of the Code de la
  Sécurité Sociale;

  (d)   his office or employment
  being either in a company which ceases to be a Subsidiary or relating to a
  business or part of a business which is transferred to a person who or which
  is neither a Subsidiary nor a Group company;

  (e)   his leaving service for any
  reason other than specified in sub-paragraph (a) to (d), at a time not
  earlier than three years from the Date of Grant.

  
	
   

  	
   

  
	
   

  	
  In cases of (a), (b),
  (c), (d) and (e), the Option may be exercised at any time during the period
  of six months from the date on which the Participant ceases to be an employee
  or director of any member of the Group notwithstanding that the Normal
  Repayment 

  

 

 20
 

 

	
  

  	
  Date shall not have
  occurred.

  
	
   

  	
   

  
	
  Rule 7.7

  	
  shall be amended to read as follows:

   

  “In the event of the
  death of a Participant, the Option may be exercised by his heirs (héritiers)
  at any time during the period of six months commencing on the date of his
  death (but not later) and the relevant héritiers (heirs) shall be entitled to
  do so notwithstanding that the Normal Repayment Date has not occurred.  For the avoidance of doubt, in the event of
  the death of the Participant prior to the Normal Repayment Date the
  provisions of Rule 7.1(b) above shall apply”;

  
	
   

  	
   

  
	
  Rule 7.8

  	
  shall be deleted in its entirety;

  
	
   

  	
   

  
	
  Rule 8(b)

  	
  shall be amended by deleting the reference to “Rule
  7.8 above” in the final line;

  
	
   

  	
   

  
	
  Rule 9

  	
  shall be deleted in its entirety and replaced with
  the following:

  
	
   

  	
   

  
	
   

  	
  “9.   Takeover and Liquidation

   

  9.1     In the event of:

   

  (a)         a change of Control of
  the Company in accordance with Rule 9.2;

  (b)         the Court sanctioning a
  compromise or arrangement, scheme under section 425 Companies Act 1985;

  (c)         a person becoming bound
  or entitled to acquire Shares pursuant to sections 428-430 of the Companies
  Act 1985;

  (d)         the passing of a
  resolution for the voluntary winding up of the Company;

  (e)         an appropriate offer or
  proposal shall be made to the French resident Participants in respect of any
  Subsisting Options.

  
	
   

  	
  9.2     A person obtains control of
  the Company as a result of making:

   

  (a)         a general offer to
  acquire the whole of the issued share capital of the Company (not otherwise
  held or contracted to be acquired by the offeror) which is made on the
  condition such that if it is satisfied the person making the offer will have
  the Control of the Company; or

  (b)         a general offer to
  acquire all the shares in the Company which are of the same class as the Shares
  (including the Shares represented by the ADS).

  
	
   

  	
   

  
	
   

  	
  9.3 For the purposes of this Rule 9
  a person shall be deemed to have obtained Control of a Company if he and
  others acting in concert with him have together obtained Control of it.”;

  

 

 21
 

 

	
  Rule 12

  	
  Rule 12.2(b) shall be amended to read as follows:

   

  “to any rights already accrued to any Participant
  which would be to the disadvantage of such Participant, without prior consent
  of such Participant.”

   

  The following wording shall be added to the end of
  this Rule:

   

  “12.13     In order to ensure the most
  favourable treatment for the Group (as a first priority) and for the French
  Eligible Employees (as a second priority) in terms of taxes, social security
  charges and all similar duties whatsoever, under French law from time to time
  in force, the Board may, in accordance with article L225-177 of the Code,
  impose an interdiction de revente immédiate (“Compulsory Holding Period”)
  during which the Shares acquired on exercise of any Option may not be sold by
  the French Eligible Employee (except in circumstances where such sale will
  not undermine a favourable regime otherwise applying, including for example
  those circumstances specified in article 91 ter of Annexe II of the Tax
  Code).  The Compulsory Holding Period
  may in no circumstances exceed three years from the date of exercise of the
  relevant Option.

   

  Furthermore, the Board
  may require the French Eligible Employees to expressly undertake to respect a
  Compulsory Holding Period, and, in the event of breach of this undertaking,
  to indemnify their French employing company and any member of the Imperial
  Tobacco Group in respect of all charges, expenses or liability of any nature
  whatsoever incurred by such entities as a result of such breach.”

  
	
   

  	
   

  
	
  Rule 13 

  	
  The following words shall be added to this Rule:

   

  “Furthermore, no
  further Options will be granted by the Board more than 38 months after the
  Adoption Date unless authorisation is given by the Company in general meeting
  for the Board to do so.  Such
  authorisation may be granted for a further period of up to 38 months.”;

  
	
   

  	
   

  
	
  Rule 14.2 

  	
  The following wording shall be added to this Rule:

   

  “, although for the purposes of Options granted to
  French Eligible Employees, the terms and conditions of the Plan shall be
  interpreted in accordance with French law, where necessary in order to ensure
  compliance with the Code, the Instruction and the relevant articles of the
  Tax Code, to the extent required under French law in order to ensure the most
  favourable tax treatment of the Plan from the perspective of the Group, as a
  first priority, and the French Eligible Employees, as a second priority.”

  

 

 22
 

Appendix
5

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR GERMANY

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any Option granted or to be
granted to a person resident for tax purposes in Germany.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 5
except as otherwise provided.

Rule 1

	
  “Specified Age”

  	
  shall be deleted.

  
	
   

  	
   

  
	
  Rule 7.5(a)

  	
  delete the words “on reaching Specified Age or such
  other age at which he is bound to retire in accordance with the terms of his
  employment”.

  
	
   

  	
   

  
	
  Rule 7.8

  	
  shall be deleted and Rules 7.9 and 7.10 and any
  references thereto shall be re-numbered accordingly.

  

 

 23
 

Appendix
6

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR ITALY

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified as to conform with the provisions of the Italian Civil
Code and to various provisions of the Presidential Decree 22 December 1986, no.
917 (the Italian Consolidated Tax Act “ICTA”) in
order to obtain the most favourable tax treatment of the Plan available under
Italian law from the perspective of the Group and any Italian Eligible Employee

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 6
except as otherwise provided.

Rule 1

	
  “Eligible Employee”

  	
  shall be amended to read:

   

  “any employee of a
  Participating Company which has a salaried employment on a permanent basis
  and any “collaboratore coordinato e continuativo”
  (including a director) of a Participating Company at the Invitation Date
  PROVIDED HOWEVER THAT at the Invitation Date no notice of termination of such
  employment has been served by either the employee concerned or his employing
  Participating Company. Such rule would also apply in respect of any “collaboratore coordinato e continuativo” (including a
  director) of a Participating Company”;

  
	
   

  	
   

  
	
  “Participant” 

  	
  shall be amended by deleting the words “personal
  representatives” and replacing them with the words “eredi (heirs)”;

  
	
   

  	
   

  
	
  “Specified Age” 

  	
  shall be deleted;

  
	
   

  	
   

  
	
  “Subsidiary” 

  	
  shall be replaced as follows:

   

  “means any company in
  relation to which the Company:

   

  (a)  holds a majority of the voting
  rights in the ordinary shareholders’ meeting; or

  (b)  has sufficient voting rights
  in the ordinary shareholders’ meeting to exercise a prevailing influence
  therein; or

  (c)  exercises a prevailing
  influence on the company by virtue of specific negotiable agreements;

  in accordance with the
  requirements of Article 2359 of the Italian Civil Code. Such definition also
  includes any other company which is a subsidiary as defined above of a
  company which is itself a subsidiary of the Company”.

  
	
   

  	
   

  
	
  Rule 6

  	
  shall be deleted and replaced with the following
  wording:

   

  “In principle the
  Exercise Price shall not be modified during the life of the Option. However,
  in the event of any alteration in the issued share capital of the Company (by
  way of one of the operations envisaged by the Italian Civil Code) then the
  Exercise Price may be adjusted by the Board in such manner and with effect
  from such 

  

 

 24
 

 

	
  

  	
  date as the Board may
  deem appropriate in order to comply with the provisions of the Italian Civil
  Code”

  
	
   

  	
   

  
	
  Rule 7.5

  	
  shall be deleted and replaced with:

   

  “7.5    An Option shall cease to be
  exercisable upon the Participant ceasing to be an employee or a
  “collaboratore coordinato e continuativo” of any member of the Group (so as
  to hold no such employment or office) except where his so ceasing is by
  reason of any of the following circumstances:

   

  (a)         redundancy; or

  (b)        his being required by
  his employer to take retirement or his taking retirement, in both cases, in
  circumstances where he is entitled to a full pension and has reached an age
  at which he is entitled to exercise his pension rights; or

  (c)         invalidity; or

  (d)        his office or employment
  being either in a company which ceases to be a Subsidiary or relating to a
  business or part of a business which is transferred to a person who or which
  is neither a Subsidiary nor a Group company; or

  (e)         his leaving service at
  any time other than that specified in sub-paragraph (a) to (d) above,
  provided that such event occurs not earlier than three years from the Date of
  Grant;

  in any of which
  circumstances the Option may be exercised at any time during the period of
  six months from the date on which he so ceases to be an employee or a “collaboratore coordinato e continuativo” of any member of
  the Group notwithstanding that the Normal Repayment Date shall not have
  occurred.

  
	
   

  	
   

  
	
  Rule 7.6(a) 

  	
  shall be replaced with the following wording:

   

  “7.6    For the purposes of Rule 7.5
  above and Rule 9 below (but for no other purpose):

   

  (a)         a Participant shall not
  be regarded as having ceased to hold office or employment by reason of:

   

  (i)          his being or becoming
  employed or a “collaboratore coordinato e continuativo”
  by a company which ceases to be or is not a Participating Company but is
  nevertheless an Associated Company or is under the Control of the Company;
  and

  (b)        a Participant shall be
  regarded as ceasing to hold office or employment when he holds no employment
  or no agreement of “collaboratore
  coordinato e continuativo” with any of the Company, any Associated
  Company and any company controlled by

  

 

 25
 

 

	
  

  	
  the Company.”

  
	
   

  	
   

  
	
  Rule 7.7 

  	
  shall be amended by deleting the words “personal
  representatives” and replacing them with the words “eredi (heirs)”;

  
	
   

  	
   

  
	
  Rule 7.8 

  	
  shall be deleted in its entirety;

  
	
   

  	
   

  
	
  Rule 8(b) 

  	
  shall be amended by deleting the wording “or in the
  circumstances of Rule 7.8 above” in the final line;

  
	
   

  	
   

  
	
  Rule 9 

  	
  the following words shall be added to this Rule:

   

  “(b)      any other operation
  envisaged by the Italian Civil Code for the acquisition of control”;

  

 

 26
 

Appendix
7

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR NETHERLANDS

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any option granted or to be
granted to a person resident for tax purposes in the Netherlands.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 7
except as otherwise provided.

	
  Rule 1 

  

  “Eligible Employee”

  	
  

  

  delete the words “in the case only of a director holding a salaried
  employment or office, usually works at least 25 hours per week excluding time
  off permitted for meal breaks”;

  
	
   

  	
   

  
	
  “Specified
  Age”

  	
  shall be deleted;

  
	
   

  	
   

  
	
  Rule
  7.5(a)

  	
  delete the words “on reaching specified age or such
  other age at which he is bound to retire in accordance with the terms of his
  employment”;

  
	
   

  	
   

  
	
  Rule
  7.8

  	
  shall be deleted and Rules 7.9 and 7.10 and any
  references thereto shall be re-numbered accordingly;

  

 

 27
 

Appendix
8

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR NEW ZEALAND

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any Option granted or to be
granted to a person resident for tax purposes in New Zealand.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 8
except as otherwise provided.

Rule 1

	
  “Specified Age”

  	
  shall be deleted.

  
	
   

  	
   

  
	
  Rule 7.5(a)

  	
  delete the words “on reaching Specified Age or such
  other age at which he is bound to retire in accordance with the terms of his
  employment”.

  
	
   

  	
   

  
	
  Rule 7.8

  	
  shall be deleted and Rules 7.9 and 7.10 and any
  references thereto shall be re-numbered accordingly.

  

 

 28

Appendix
9

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN

APPENDIX
FOR THE UNITED STATES OF AMERICA

The
purpose of this appendix is to specify the terms and conditions under which the
Plan is to be modified in its application to any Option granted or to be
granted to a person resident for tax purposes in the United States of America.

Words
or phrases defined in the Plan shall bear the same meaning in this Appendix 9
except as otherwise provided.

Rule 1

	
  “Exercise Price”

  	
  the price per Share or price per ADS at which a
  participant may acquire Shares or ADSs pursuant to the Plan (as determined in
  accordance with Rule 5).

  
	
   

  	
   

  
	
  “Option”

  	
  a right to acquire Shares, or ADSs, granted pursuant
  to the Plan.

  
	
   

  	
   

  
	
  Rule 3.2(a)

  	
  insert “or the ADSs, if applicable,” after the words
  “Exercise Price for the Shares”.

  
	
   

  	
   

  
	
  Rule 3.2(b)

  	
  insert as a new Rule 3.2(b) the following and
  re-number Rule 3.2(b) and 3.2(c) as 3.2(c) and 3.2(d) respectively.

   

  “(b)                           whether
  the Shares to be issued upon the exercise of Options may be delivered in the
  form of ADSs; and”

  
	
   

  	
   

  
	
  Rule 3.3(a)

  	
  insert the words “or ADSs, if applicable,” after the
  word “Shares” in the penultimate line.

  
	
   

  	
   

  
	
  Rule 3.3(b)(i)

  	
  insert the words “or ADSs, if applicable,” after the
  word “Shares” in lines 4 and 5.

  
	
   

  	
   

  
	
  Rule 3.4

  	
  insert the words “or ADSs, if applicable,” after the
  word “Shares” in line 2.

  
	
   

  	
   

  
	
  Rule 3.4(a)

  	
  insert the following words after “Invitation Date”
  in the final line: “and, if permitted by the relevant invitations, Options
  shall be granted to the Eligible Employee in respect of that number of ADSs
  as would have an aggregate Exercise Price not exceeding the Relevant Multiple
  of the Eligible Employee’s proposed monthly dollar contributions to the
  Savings Plan as at the Date of Grant;”

  
	
   

  	
   

  
	
  Rule 3.4(i) and (ii)

  	
  insert the words “or ADSs, if applicable,” after the
  word “Shares” wherever that word occurs.

  
	
   

  	
   

  
	
  Rule 5.1

  	
  in line 3 insert the words “or expressed in dollars
  in the case of Options for ADSs” after the words “in the case of Options for
  Shares”

  
	
   

  	
   

  
	
  Rule 5.1(a)

  	
  insert after the words “Invitation Date” in the
  final line, the words “or eighty per cent. of the closing price per ADS as
  derived from the New York Stock Exchange Consolidated Tape on the trading day
  immediately preceding the Invitation Date in the case of Options for ADS;”

  

 

 29
 

 

	
  Rule 5.1(b)

  	
  insert at the end of this rule “or the nominal value
  of the Shares represented by ADS in the case of Options for ADSs”.

  
	
   

  	
   

  
	
  Rule 5.2

  	
  insert after the word “Shares” in line 2 “or ADSs,
  if applicable” and after the words “market value of a Share” in the last line
  “or ADS, respectively”.

  
	
   

  	
   

  
	
  Rule 6

  	
  insert in the first line in the paragraph after
  “(d)” the words “or ADSs, if applicable,” after the words “the number of
  Shares”.

  
	
   

  	
   

  
	
  Rule 6(ii)

  	
  insert after the words “nominal value of a Share”,
  in line 2 “and the Exercise price of an Option to subscribe for ADS shall not
  be adjusted below the aggregate nominal value of the Shares represented by
  such ADSs”.

  
	
   

  	
   

  
	
  Rule 7.2

  	
  shall be deleted and replaced with the following:

  

  “An Option shall be exercisable during the period mentioned in Rule 7.4 below
  in respect of all of the Shares or ADSs, if applicable, over which it was
  granted by the Participant delivering to the Secretary of the Company at its
  registered office (or otherwise as may be notified to Participants from time
  to time) a remittance for that number of Shares or ADSs, if applicable,
  calculated by reference to the Exercise Price. The date of exercise of the
  Option shall be the date the Company or the Trustee (acting as agent of the
  Company) is deemed to have received such payment.”

  
	
   

  	
   

  
	
  Rule 7.3

  	
  insert the words “or ADSs, if applicable,” after the
  word “Shares” wherever that word occurs.

  
	
   

  	
   

  
	
  Rule 7.4

  	
  delete the last sentence of Rule 7.4.

  
	
   

  	
   

  
	
  Rule 7.5

  	
  replace the words “may be exercised at any time
  during the period of six months from the date on which he ceases to be an
  employee or director of any member of the Group notwithstanding that the
  Normal Repayment Date shall not have occurred” with the words “will be
  exercised or lapse in accordance with the provisions of Appendix 9 of the
  Plan. The Participant’s ceasing to be an employee or director of any member
  of the Group by reasons set out in Rule 7.5(i), (ii) or (iii) shall be an Early
  Exercise Date. This provision shall be administered in accordance with
  Section 409A of the United States Internal Revenue Code and any guidance
  issued thereunder.”

  
	
   

  	
   

  
	
  Rule 7.7

  	
  shall be replaced with the following:

  

  “The date of the death of the Participant will be considered an Early
  Exercise Date and any Options will be exercised or lapse in accordance with
  Appendix 9 of the Plan.”

  
	
   

  	
   

  
	
  Rule 7.8

  	
  shall not be applicable.

  
	
   

  	
   

  
	
  Rule 7.10

  	
  insert the words “or ADSs, if applicable,” after the
  word “Shares”.

  
	
   

  	
   

  
	
  Rule 9.1

  	
  replace the words “may be exercised within six
  months of the time when the person making the offer has obtained Control of
  the Company and any condition subject to which the offer is made has been
  satisfied” with the words “will be exercised or lapse in accordance with the
  provisions of Appendix 9 of the Plan. The date when the person making the
  offer has obtained Control of the Company and any

  

 

 30
 

 

	
  

  	
  condition subject to which the offer is made has
  been satisfied will be considered an Early Exercise Date, but only if it
  constitutes a change in ownership or effective control of the Company under
  Section 409A of the United States Internal Revenue Code and any guidance
  issued thereunder.”

  
	
   

  	
   

  
	
  Rule 9.2

  	
  replace the words “may be exercised within six
  months of the Court sanctioning the compromise or arrangement” with the words
  “will be exercised or lapse in accordance with Appendix 9 of the Plan, and
  the effective date of the compromise or arrangement will be considered an Early
  Exercise Date, but only if it constitutes a change in ownership or effective
  control of the Company under Section 409A of the United States Internal
  Revenue Code and any guidance issued thereunder.”

  
	
   

  	
   

  
	
  Rule 9.3

  	
  insert the words “, but only if it constitutes a
  change in ownership or effective control of the Company under Section 409A of
  the United States Internal Revenue Code and any guidance issued thereunder”
  immediately following the word “entitled.”

  
	
   

  	
   

  
	
  Rule 9.4(b)

  	
  insert the words “or ADSs, if applicable,” after the
  words “Shares” in line 4.

  
	
   

  	
   

  
	
  Rule 9.5

  	
  replace the words “may be exercised within six
  months of the passing of the resolution” with the words “will be exercised or
  lapse in accordance with Appendix 9 of the Plan, and the date which constitutes
  a change in ownership or effective control of the Company under Section 409A
  of the United States Internal Revenue Code and any guidance issued thereunder
  will be considered an Early Exercise Date.”

  
	
   

  	
   

  
	
  Rule 10.2

  	
  insert a new Rule 10.2 as set out below after Rule
  10.1 and re-designate Rule 10.2 as Rule 10.3:

   

  “10.2                     Subject to
  receipt of the appropriate remittance, in the event ADSs are to be acquired
  pursuant to the exercise of an Option, ADSs will be transferred not later
  than 45 days after the exercise of the Option and will rank pari passu in all
  respects with the ADSs in issue on the date of exercise save that they will
  not rank for any dividend or other distribution paid or made by reference to
  the date (known as the ADS record date) on which entitlement to the dividend
  or distribution is fixed by the Depositary if that date falls prior to the
  date of exercise of the Option.”

  
	
   

  	
   

  
	
  Rule 10.4

  	
  insert a new Rule 10.4 as set out below:

   

  “10.4                     If the ADSs
  are listed on the New York Stock Exchange, Inc. at the date of transfer of
  ADSs pursuant to the Plan the Company will, if required, apply to the New
  York Stock Exchange, Inc. for permission for such ADSs so transferred to be
  listed on the New York Stock Exchange, Inc.”.

  
	
   

  	
   

  
	
  Rule 14.1

  	
  insert the words “or ADSs, if applicable” after the
  word “Shares” in line 2.

  

 

Notwithstanding any provision to the contrary, the exercise date for an
Option granted to a Participant covered under this Appendix 9 shall be a date
certain following the Participant’s Normal Repayment Date (or Early Exercise
Date, where applicable) (collectively referred to herein as “Determination
Date”), and any Option payable with an Exercise Price less than Fair Market
Value on the date

 31
 

certain shall be automatically exercised. Any Option payable with an
Exercise Price greater than Fair Market Value on the date certain shall
automatically lapse. No Participant covered by this Appendix 9 shall make any
election or exercise discretion with respect to the exercise or lapse of any
applicable Option. Unless otherwise provided in the invitation issued for the
Option in accordance with Rules 3.1 or 3.2 of the Plan, the date certain shall
be the date 30 days following the Participant’s Determination Date. For
purposes of this paragraph, “Fair Market Value” means the closing price per ADS
as derived from the New York Stock Exchange Consolidated Tape on the trading
day immediately preceding the date certain.

 

Any Participant’s contributions held under a Savings Plan attributable
to a Participant’s Option which lapse in accordance with the preceding
paragraph shall automatically be paid to the Participant in accordance with the
terms of the Plan.

 

 32
 

SCHEDULE 2

The
Imperial Tobacco Group UK Sharesave Plan

 33
 

SCHEDULE 3

The
Imperial Tobacco Group Irish Sharesave Plan

 34
 

SCHEDULE 4

Notional
Awards

The
rules governing Notional Awards (the “Phantom Plan”)
shall be constituted by the rules of the Plan save as the same (including the
definitions used) are modified by the terms of this schedule 4, as set out
below.

In
relation to any invitation made under the Plan, the terms of this schedule 4
shall, unless otherwise determined by the Board, apply in respect of Eligible
Employees resident in each of the jurisdictions (“Relevant Employees”)
specified in Appendix 1 to this schedule 4:

1.                                           In this Phantom Plan the following terms shall have
the following meanings:

“Award” the sum paid or to be paid to a Relevant Employee by
way of remuneration in accordance with this Plan on the exercise of a Notional
Award being the difference between the Exit Price and the Notional Exercise
Price for each Share in respect of which the Notional Award is exercised;

“Exit Price” the middle market price of a Share as derived from
the London Stock Exchange Daily Official List for the dealing day immediately
preceding that on which a Notional Award is exercised;

“Notional Award” the notional right to acquire at the Notional
Exercise Price Shares in accordance with the terms of the Plan;

“Notional Gain” the sum paid or to be paid to a Relevant Employee by
way of remuneration in accordance with this Plan on the exercise of a Notional
Award being the difference between the Exit Price and the Notional Exercise
Price for each Share in respect of which the Notional Award is exercised, but
only if the Exit Price is higher than the Notional Exercise Price;

“Notional Exercise Price” the price per Share at which a Participant may
acquire Shares the subject of a Notional Award calculated in accordance with
Rule 5 of the Plan;

“Subsisting Notional Award” a Notional Award to the extent that it has neither
lapsed nor been exercised;

2.                                           In Rules 3, 8, 9, 11, 12 and 13 of the Plan references
to Option, Exercise Price, and Eligible Employee shall be replaced by
references to Notional Award, Notional Exercise Price, and Relevant Employee
respectively.

3.                                           In respect of each grant of Notional Awards, the Board
shall identify those Relevant Employees to whom Notional Awards shall be
granted and shall grant the Notional Award(s) in the same manner as provided in
Rule 3.4 of the Plan.  For the avoidance
of doubt, Rule 3.4(c) of the Plan shall apply to the grant of Notional Awards
as it does for the grant of Options under the Plan.  The Relevant Employee will be given a
certificate stating the Notional Exercise Price and the number of Shares
subject to the Notional Award.

4.                                           In Rule 4, for the purposes of calculating the limits
contained therein, the aggregate number of Shares shall include the number of
Shares the subject of Notional Awards.

5.                                           The Notional Award shall be capable of being exercised
in all respects in the same manner as an Option in accordance with Rule 7 of
the Plan save that no payment or remittance is due as provided in Rules 7.1 and
7.2 and provided that the Notional Award may only be exercised in full where exercise
occurs on or after Normal Repayment Date.

6.                                           Rule 7.3 shall be deleted and replaced with the
following:

 35
 

“7.3                    The exercise of a Notional Award under the Phantom
Plan shall be subject to the following conditions (a) that the Participant
shall withdraw all sums due by way of Repayment under the Savings Plan to which
he has contributed in relation to the Notional Award and (b) that the
Participant provides the Company with evidence in such form as it may require,
of his Savings Plan and the Repayments due to him under the Savings Plan.

7.                                           Rule 9.4 and 10 of the Plan shall not apply in
relation to the Notional Awards.

8.                                           Within 30 days of receipt of the appropriate notice in
accordance with Rule 7 the Board shall procure payment to the Relevant Employee
of the Notional Gain attributable to the Shares in respect of which the
Notional Award has been exercised.

9.                                           There shall be made from any payment under Rule 8 of
the Phantom Plan such deductions (on account of tax, national insurance
contributions, social security contributions or similar liabilities) as may be
required by law or as the Company may reasonably consider to be necessary or
desirable.

10.                                     If there is an adjustment to Options pursuant to Rule
6 of the Plan, an adjustment confirmed by the Auditors in writing to be in
their opinion an equivalent adjustment shall be made to Notional Awards.

11.                                     Payments under Rule 8 of the Phantom Plan will not be
pensionable.

 36
 

Appendix
1

THE
IMPERIAL TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN – NOTIONAL AWARDS

Belgium

Canada

Kazakhstan

Macedonia

Poland

Serbia

Ukraine

The Rules of the
Plan apply with and subject to the following amendments and provisions which
have been adopted by the Board pursuant to Rule 12.7 for the purposes of the
operation of the Plan in the jurisdiction specified below:

Canada (Appendix
2)

 37
 

Appendix
2

IMPERIAL
TOBACCO GROUP INTERNATIONAL SHARESAVE PLAN – NOTIONAL AWARDS

APPENDIX
FOR CANADA

The
purpose of this appendix is to specify the terms and conditions under which the
Phantom Plan is to be modified in its application to any Notional Award granted
or to be granted to a person resident for tax purposes in Canada.

Words
or phrases defined in the Phantom Plan shall bear the same meaning in this
Appendix 2 except as otherwise provided.

Section 1

	
  “Award”

  	
  delete the word “remuneration” after the words “to
  be paid to a Relevant Employee by way of” and replace with the phrase “a
  bonus or similar payment in respect of services rendered by the Relevant
  Employee”, and add the phrase “, but only if the Exit Price is higher than
  the Notional Exercise Price” after the words “in respect of which the
  Notional Award is exercised”.

  
	
   

  	
   

  
	
  “Notional Gain”

  	
  delete the word “remuneration” after the words “to
  be paid to a Relevant Employee by way of” and replace with the phrase “a
  bonus or similar payment in respect of services rendered by the Relevant
  Employee”.

  
	
   

  	
   

  
	
  Section 5

  	
  is deleted and replaced with the following:

  

 

	
  5.

  	
  (a)

  	
  The Notional Award shall be capable of being
  exercised in all respects in the same manner as an Option in accordance with
  Rule 7 of the Plan save that no payment or remittance is due as provided in
  Rules 7.1 and 7.2, and provided that, notwithstanding any other provision of
  the Plan or the Phantom Plan, no amount in respect of an Award or a Notional
  Gain shall be paid to a Relevant Employee later than the end of the calendar
  year which is the third calendar year immediately following the end of the
  calendar year of the Date of Grant.

  
	
   

  	
   

  	
   

  
	
   

  	
  (b)

  	
  Rule 7.4 shall be deleted and replaced with the
  following:

  

 

“7.4                    Save as otherwise provided, an Award may not be
exercised until the Normal Repayment date. No Award (including for greater
certainty a Subsisting Award) may be exercised later than 6 months after the
Normal Repayment Date or November 15th in the calendar year of the Normal
Repayment Date, whichever is earlier, and all Awards in respect of which the
Exit Price is higher than the Notional Exercise Price which are not already
exercised shall be deemed to be exercised on November 15th in the calendar year
of the Normal Repayment date, and for this purpose the Participant must elect
to add to the Repayment for the purposes of Rule 7.3 by November 30th of the
calendar year of the Normal Repayment Date. [NTD: The
dates within this Appendix may be changed at Imperial’s discretion as long as
all cash awards are distributed to employees in Canada by December 31 in the
third calendar following date of grant (e.g. if grant made in 2004, award must
be paid by December 31 2007.) We have tried to ensure that there is sufficient
time between the Normal Repayment Date, the exercise and the distribution of
the award]. For greater certainty, all Awards (including Subsisting
Awards) in respect of which the Exit Price is equal to or less than the
Notional Exercise Price shall not be deemed to be exercised pursuant to this
Rule 7.4.

 38
 

(c)                                Rule 7.5 shall be amended by adding the phrase “or by
November 15th in the calendar year of the Normal Repayment Date (except to the
extent that such Award is deemed to be exercised in accordance with Rule 7.4),
whichever is earlier” after the words “notwithstanding that the Normal
Repayment Date shall not have occurred”.

(d)                               Rule 7.7 shall be amended by adding the phrase “, but
in any event the personal representatives shall not be entitled to exercise the
Award (except to the extent that such Award is deemed to be exercised in
accordance with Rule 7.4) later than November 15th in the calendar year of the
Normal Repayment Date” after the words “within twelve months commencing on the
Normal Repayment Date”.

(e)                                Rule 7.8 shall be amended by adding the phrase “or by
November 15th in the calendar year of the Normal Repayment Date (except to the
extent that such Award is deemed to be exercised in accordance with Rule 7.4),
whichever is earlier” after the words “within six months after the date of his
reaching the Specified Age”.

(f)                                  Rule 8(b) shall be amended by adding “provided that in
no event shall the Normal Payment Date occur later than November 1 of the
calendar year which is the third calendar year immediately following the end of
the calendar year of the Date of Grant”, to be added after the words “above or
Rule 9 below”.

(g)                               Rule 9.1 shall be amended by adding the phrase “, but
in any event not later than November 15th of the calendar year of the Normal
Repayment Date (except to the extent that such Award is deemed to be exercised
in accordance with Rule 7.4)” after the words “is made had been satisfied”.

(h)                               Rule 9.3 shall be amended by adding the phrase “, but
in any event not later than November 15th of the calendar year of the Normal
Repayment Date (except to the extent that such Award is deemed to be exercised
in accordance with Rule 7.4)” after the words “of the Court sanctioning the compromise
or arrangement”.

(i)                                   Rule 9.4 shall be amended by adding the phrase “, but
in any event not later than November 15th of the calendar year of the Normal
Repayment Date (except to the extent that such Award is deemed to be exercised
in accordance with Rule 7.4)” after the words “that person remains so bound or
entitled”.

(j)                                   Rule 9.4 shall be amended by adding the phrase “, but
in any event not later than November 15th of the calendar year of the Normal
Repayment Date, “ after the words “as defined in paragraph 38(3) of Schedule 3”.

(k)                                Rule 9.5 shall be deleted and replaced with the
following:

“9.5                    If the Company passes a resolution for voluntary
winding up, any Subsisting Award may be exercised at any time within six months
of the passing of the resolution or by November 15th of the calendar year of
the Normal Repayment Date in respect of such Subsisting Award (except to the
extent that such Subsisting Award is deemed to be exercised in accordance with
Rule 7(D)), whichever is earlier.

 39
 

SPECIMEN

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN (the
“Plan”)

INVITATION

(on Company headed notepaper)

Dear
Colleague,

The
Directors of Imperial Tobacco Group PLC invite you to apply for an option to
acquire ordinary shares in Imperial Tobacco Group PLC (the “Company”) under the
Rules of the above Plan.

Enclosed
are:

1.                                           a booklet which explains how the Plan works;

2.                                           an application for a share option;

3.                                           [[an application to open a savings account with [            ]];

You
should read these documents carefully before deciding to commit yourself to
participating.  If you are in any doubt
about any feature of the Plan, please contact .·

Under
the Rules you are entitled to take out a savings contract, with a monthly
contribution of up to £250 or its equivalent in your local or other agreed
currency.  If you wish, however, you can
take out a contract, depending upon the frequency of your salary payments, for
any amount up to the maximum, subject to a minimum contribution of £5 per month
(or the equivalent sum at the Date of Grant in the currency of your country of
employment).

If
you would like to join the Plan you should complete and sign the attached Share
Option Application [and savings account application forms].  THESE MUST BE RETURNED TO · NOT LATER THAN [  
PM] ON [         ].  IT WILL NOT BE POSSIBLE TO CONSIDER
APPLICATIONS RECEIVED AFTER THAT DATE.

Yours
sincerely

 

[Company
Secretary]

 40
 

SPECIMEN

THE IMPERIAL TOBACCO GROUP PLC

INTERNATIONAL SHARESAVE PLAN

SHARE OPTION APPLICATION

To:                                                                        The Plan Administrator

PLEASE
USE BLOCK CAPITALS

	
  SURNAME

  	
  MR/MRS/MISS/MS

  
	
   

  	
   

  
	
  FIRST NAMES

  
	
   

  
	
  HOME ADDRESS.

  
	
   

  
	
   

  	
  .POSTCODE

  
	
   

  	
   

  
	
  PLACE OF EMPLOYMENT.

  

 

I
wish to save [£      ] per month (between
£5 and £250) for 36 months (or the equivalent sums at the Date of Grant in the
currency of my country of employment)

	
  NOTES:

  	
  (1)                                  Contributions
  must be not less than £5 per month and the aggregate contributions to be made
  in any month under this contract and any other contract(s) linked to this
  Plan into which you have previously entered must not be more than £250. For
  weekly paid employees, a quarter of the monthly amount will be deducted
  weekly until the equivalent of [36/60] monthly payments have been made, (or
  the equivalent sums at the Date of Grant in the currency of your country of
  employment).

  
	
   

  	
   

  
	
   

  	
  (2)                                  The
  Normal Repayment Date may be postponed if you miss any contributions.

  

 

PLEASE
READ AND SIGN

*                                       I hereby apply for an option over ordinary shares in
the capital of Imperial Tobacco Group PLC, the cost of which will be met from
repayments and any additional sums under the savings contract for which a
proposal form is attached.

*                                       I hereby declare that I am applying for an option on
my own behalf and not as a trustee or nominee for any other person(s).

*                                       I hereby authorise the Company to submit my savings
application to [           ] on my behalf
and to make the corresponding deductions from my pay.

*                                       I authorise the Company Secretary to make such
adjustments to the amount to be saved by me under the savings contract referred
to above as may be necessary if my application is scaled down in accordance
with the Rules of the Plan and the number of shares allotted to me is less than
the number of shares which I have

 41
 

applied
for, further I authorise the Company to submit such amended savings application
to [          ].

*                                       I understand that if I am granted an option it will be
subject to the Rules of the Plan, by which I agree to be bound.  A copy of the Rules of the Plan is available
for inspection at [                  ].

Unless
the context otherwise requires terms defined in the Rules of the Plan shall
have the same meaning herein.

	
  SIGNATURE

  	
  DATE

  

 

 42
 

SPECIMEN

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN

OPTION CERTIFICATE

	
  Name of Option Holder

  
	
   

  
	
  Address of Option Holder

  
	
   

  
	
   

  
	
   

  
	
   

  	
  Post Code

  
	
   

  	
   

  
	
  Option Certificate Number 

  
	
   

  
	
  Number of shares granted under this option 

  
	
   

  
	
  Date of grant 

  

 

This
is to certify that the above named person was on the above date granted an
option as specified for ordinary shares of [ 
]p each in the capital of Imperial Tobacco Group PLC (the “Company”) at
an exercise price of [     ]p per share
upon and subject to the terms of The Imperial Tobacco Group International
Sharesave Plan.

	
  Signed on behalf of

  
	
   

  	
  Director.

  	
  Secretary

  

 

 

	
  NOTES:

  	
  (1)                                  The
  option cannot be assigned or transferred.

  
	
   

  	
   

  
	
   

  	
  (2)                                  In
  order to exercise your option complete the Form of Exercise printed overleaf
  and send it together with a cheque for the relevant exercise price of the
  shares and evidence of the amount repaid under your savings contract to the
  Company Secretary of the Company.

  

 

THIS
DOCUMENT MUST BE RETAINED.  PLEASE KEEP
IT IN A SAFE PLACE.  This certificate is
issued as a matter of record only and is not a document of title.

 43
 

SPECIMEN

[Reverse of Certificate]

THE IMPERIAL TOBACCO GROUP

INTERNATIONAL SHARESAVE PLAN

FORM OF EXERCISE OF OPTION

To:                                                                            The Company Secretary

Imperial
Tobacco Group PLC

(In
order to exercise your option you should complete, sign and return this
document to the Company Secretary at the above address.)

1.                                           I wish to exercise the option referred to on the
reverse Option Certificate in respect of [           ] ordinary shares.  (Insert the number of shares in respect of
which the option is exercised.  If you do
not wish to exercise the option for all the shares shown on the attached
certificate you may exercise options for a lesser number.

2.                                           I enclose a cheque for £            in favour of Imperial Tobacco Group PLC being
the total exercise price payable under this option for the above specified
number of ordinary shares together with evidence of the amount repaid to me
under my savings contract.

Personal
Details

	
  SURNAME

  	
  MR/MRS/MISS/MS.

  
	
   

  	
   

  
	
  FIRST NAMES

  
	
   

  
	
  HOME ADDRESS.

  
	
   

  
	
   

  	
  POST CODE

  
	
   

  	
   

  
	
  SIGNATURE

  	
   

  	
  DATE

  	
   

  	
   

  
						

 

 

NOTE:                                                          This option may be exercised only by the person to
whom it was granted or their personal representative(s).

IF
YOU ARE IN ANY DOUBT, PLEASE CONTACT YOUR/THE PLAN ADMINISTRATOR

 44

IMPERIAL TOBACCO GROUP PLC

 

 

THE
IMPERIAL TOBACCO GROUP IRISH SHARESAVE PLAN

(approved under Schedule
12A Taxes Consolidation Act, 1997)

 

 

adopted
by the Company at its Annual General Meeting on 1 February 2005

pursuant to a
shareholders resolution passed on 1 February 2005

and approved by the
Revenue Commissioners on 11 March 2005

 

 

 

A
& L Goodbody

International Financial
Services Center,

North Wall Quay,

Dublin 1

Tel:
01 - 649-2000

Fax:  01 - 649-2649

THE
IMPERIAL TOBACCO GROUP IRISH SHARESAVE PLAN

CONTENTS

	
  CLAUSE

  	
   

  	
  PAGE

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.

  	
   

  	
  DEFINITIONS

  	
   

  	
  1

  
	
  2.

  	
   

  	
  COMMENCEMENT AND TITLE

  	
   

  	
  3

  
	
  3.

  	
   

  	
  GRANT OF OPTIONS

  	
   

  	
  3

  
	
  4.

  	
   

  	
  LIMITATIONS ON THE ISSUE OF SHARES

  	
   

  	
  5

  
	
  5.

  	
   

  	
  EXERCISE PRICE

  	
   

  	
  6

  
	
  6.

  	
   

  	
  ADJUSTMENT OF OPTIONS

  	
   

  	
  6

  
	
  7.

  	
   

  	
  EXERCISE OF OPTIONS

  	
   

  	
  6

  
	
  8.

  	
   

  	
  LAPSE OF OPTIONS

  	
   

  	
  8

  
	
  9.

  	
   

  	
  TAKE-OVER AND LIQUIDATION

  	
   

  	
  8

  
	
  10.

  	
   

  	
  ALLOTMENT AND LISTING

  	
   

  	
  10

  
	
  11.

  	
   

  	
  EMPLOYMENT RIGHTS

  	
   

  	
  10

  
	
  12.

  	
   

  	
  ADMINISTRATION OF THE PLAN

  	
   

  	
  11

  
	
  13.

  	
   

  	
  TERMINATION OF THE PLAN

  	
   

  	
  13

  
	
  OPTION CERTIFICATE

  	
   

  	
  14

  

 

RULES OF THE IMPERIAL TOBACCO GROUP IRISH SHARESAVE
PLAN

1.                                           Definitions

In these Rules (unless the context otherwise requires)
the following words and expressions have the following meanings:

“Act” means the Taxes Consolidation Act, 1997

“Adoption Date” means the date on which the Imperial Tobacco Group
International Sharesave Plan is adopted by the Company in general meeting;

“Application Period” means such period as the Board may determine but
being a period not less than 14 days and not more than 21 days from an
Invitation Date;

“Associated Company” has the same meaning as in Section 432 of the Act;

“Auditors” means the auditors for the time being of the Company;

“Board” means the Board of directors for the time being of
the Company (or the directors present at a duly convened meeting of such
Board), the remuneration committee of the Board or any other duly authorised
committee thereof;

“Bonus Date” means the earliest date on which a bonus is payable
under the Savings Contract;

“Commencement Date” means the date on which the Plan is approved by the
Revenue Commissioners;

“Company” means Imperial Tobacco Group PLC;

“Continuous Service” means the aggregate amount of service with:

(a)                            any Participating Company (including service with such
company before it became a Participating Company); and

(b)                           any other company which is or was a Subsidiary
(including service with any such other company before it became a Subsidiary);

provided that:

(i)                              all such service has been continuous; and

(ii)                           in the case of an employee who is absent from such
employment for any reason for a period during which such employee’s contract of
service subsists under Irish law, or by reason of maternity leave, and who then
returns to such employment, any such period of absence shall be deemed to have
formed part of such employee’s continuous service;

“Control” has the same meaning as in Section 432 of the Act;

“Daily Official List” means the daily record setting out the prices of all
trades in securities conducted on the London Stock Exchange;

“Date of Grant” means the date on which the Board passes a resolution
to grant an Option under Rule 3.4 below;

“€” means Euro

 1
 

“Eligible
Employee”
means any employee (including a full-time director holding a salaried
employment or office) of a Participating Company who:

(a)                            on the relevant Date of Grant has achieved such period
of Continuous Service not exceeding three years as the Board shall on or before
the Invitation Date determine;

(b)                           is chargeable to tax in respect of his office or
employment under Schedule E of the Act; and

(c)                            is not ineligible to participate in the Plan by virtue
of any of the provisions of the Act including in particular paragraph 8 of
Schedule 12A

provided that:

(i)                              the Board may treat any employee or director of a
member of the Group who meets requirement (c) above as an Eligible Employee;
and

(ii)                           at the Invitation Date no notice of termination of
such employment has been served by either the employee concerned or his
employing Participating Company and the employee or director in question has
not ceased to hold office or employment with a Participating Company;

“Employees’ Share Scheme” has the meaning given to it in section 743 of the UK
Companies Act 1985;

“Euro Equivalent” means in relation to an amount denominated in GB pounds
Sterling its equivalent in Euros at such exchange rate as the Board shall in
its discretion designate on or before the Invitation Date;

“Exercise Price” means the price per Share in GB pounds Sterling at
which a Participant may acquire Shares pursuant to the Plan (as determined in
accordance with Rule 5);

“Group” means the Company and its Subsidiaries from time to
time together with any such company as the Board and the Revenue Commissioners
shall have agreed may participate in the Plan;

“Invitation Date” means the date upon which invitations to apply for
Options are issued by the Board, being a date within 42 days after the
Commencement Date and thereafter within 28 days after the date of public
announcement of the annual or half yearly results of the Group;

“London Stock Exchange” means London Stock Exchange plc or any successor
company or body carrying on the business of London Stock Exchange plc;

“Official List” means the list maintained as the official list by the
UK Listing Authority acting in its capacity as the competent authority for the
purposes of Part VI of the UK Financial Services and Markets Act 2000;

“Option” means a right granted pursuant to the Plan to acquire
Shares;

“Participant” means a person who holds a Subsisting Option or
(where the context admits) his personal representatives;

“Participating Company” means any member of the Group which the Board has
designated as a member of the Plan for the time being;

“Plan” means the Imperial Tobacco Group Irish Sharesave Plan
as amended from time to time;

 2
 

“Repayment” means in relation to a Savings Contract, the amount
of the contributions repayable and, where relevant, of any bonus and/or
interest payable on the termination of the Savings Contract;

“Savings Contract” means a certified contractual savings scheme within
the meaning of Section 519C(4) of  the
Act with a qualifying savings institution as defined in Section 519C(1) of the
Act;

“Schedule 12A” means Schedule 12A to the Act;

“Share” means a fully paid ordinary share in the capital of
the Company which satisfies paragraphs 11 to 15 of Schedule 12A;

“Specified Age” means the age of 60 years;

“Subsidiary” means a subsidiary of the Company as defined in
Section 155 of the UK Companies Act 1963 over which the Company has Control;

“Subsisting Option” means an Option to the extent that it has neither
lapsed nor been exercised;

“Trustee” means the trustee or trustees for the time being of
any employee trust established by the Company wholly or partly for the benefit
of all or most of the persons for the time being employed or holding office
with the Group or any Participating Company or Companies which has been
designated by the Board as a trust out of which Options may be granted.

Where the context so permits the singular shall
include the plural and vice versa and the masculine gender shall include the
feminine.  Any reference to a statutory
provision includes a reference to that provision as for the time being amended
or re-enacted and shall include any regulations or other subordinate legislation
made under it.

2.                                           Commencement and Title

The Plan shall commence on the Commencement Date and
shall be known as the Imperial Tobacco Group Irish Sharesave Plan.

3.                                           Grant of Options

3.1                                     On or prior to an Invitation Date the Board may decide
in its absolute discretion:

(a)                            whether to invite applications for the grant of
Options.  Such invitations shall be
issued in such form as the Board shall prescribe from time to time including by
way of electronic communication; and

(b)                           whether to invite applications for three year Options
or five year Options.

3.2                                     Where applications are invited, such invitations shall
be sent to all Eligible Employees and shall state:

(a)                            the Exercise Price or the method by which the Exercise
Price for the Shares will be notified to Eligible Employees;

(b)                           the date being the last day of the Application Period
by which applications for the grant of Options must have been received by the
Board or such person as the Board may direct being not less than 14 nor more
than 21 days after the Invitation Date except in exceptional circumstances as
determined by the Board; and

(c)                            whether application may be made for three year Options
or five year Options;

 3
 

PROVIDED THAT any accidental failure or omission to
deliver an invitation to an Eligible Employee shall not invalidate the grant of
an Option to any other Eligible Employee.

3.3                                     Applications for Options under the Plan shall be in
such form as the Board may prescribe from time to time and each:

(a)                            must be accompanied by a duly completed application
form to enter into a Savings Contract under which the applicant agrees to make
such specified contributions being:

(i)                              not less than €12 per month (or such other amount as
may be specified under the Department of Finance Specifications for the
purposes of paragraph 25(2)(a) of Schedule 12A; nor

(ii)                           when aggregated with contributions made under any
other savings contract linked to a savings related share option scheme approved
under Schedule 12A, more than the lower of €320 (or such other maximum
amount as may for the time being be permitted by the Department of Finance
Specifications for the purposes of paragraph 25(2)(a) of Schedule 12A) and the
Euro Equivalent of 250 GB pounds Sterling per month;

as shall secure on the Bonus Date, as nearly as may
be, Repayments of an amount equal to that for which Shares may be acquired
under his Option if exercised in full; and

(b)                           shall empower the Board or any person authorised by
it:

(i)                              to amend the amount of the specified contribution
referred to in Rule 3.3(a) above to such lesser sum as shall secure on the
Bonus Date, as nearly as may be, Repayments of an amount equal to that for
which Shares may be acquired by the Participant in the event that the number of
Shares for which an Eligible Employee applies for an Option has to be reduced
in accordance with Rule 3.4 below; and

(ii)                           to deduct from the Participant’s pay such contribution
as shall be specified by the Participant pursuant to Rule 3.3(a) or as may be
amended pursuant to Rule 3.3(b)(i) above and pay the same on behalf of the
Participant in discharge of the Participant’s obligations under the Savings
Contract; and

(iii)                        to state whether any bonus payable under the Savings
Contract shall be included in the amount of the Repayment which may be used to
exercise the Option.

(c)                            must state whether the application is for a three year
Option or a five year Option.

3.4                                     Within 30 days or, in exceptional circumstances, such
longer period as may have been previously agreed in writing with the Revenue
Commissioners, of the date pursuant to Rule 5.1(a) by reference to which the
Exercise Price was determined or in a case where the number of shares over
which Options are to be granted is determined by Rule 3.4(b) below, within
42 days of such date and subject to the limitations and conditions contained in
the Plan, Options shall by resolution of the Board be granted to the Eligible
Employees who have applied for them in accordance with the following
provisions:-

(a)                              Options shall be granted to the Eligible Employees in
respect of all the Shares applied for by them, save that

(b)                           where the Board in its discretion considers that it is
desirable to limit the number of Shares in respect of which Options are granted
in relation to any invitation and applications are received which would, if met
in full, exceed that limit, then the

 4
 

following steps shall be carried out successively to
the extent necessary to eliminate the excess over the limitation imposed:

(i)                              the excess over the minimum monthly savings
contribution permitted under Rule 3.3(a) chosen by each applicant shall be
reduced pro rata to the extent necessary; and

(ii)                           applications will be selected by lot, each based on a
monthly savings contribution of the minimum amount permitted under Rule 3.3(a)
and the inclusion of no bonus in the Repayment under the Savings Contract.

3.5                                     No payment will be required from a Participant on the
grant of an Option.  Each Participant
will be issued with a certificate.

3.6                                     No Option shall be capable of being transferred by a
Participant.

3.7                                     No Option shall be granted more than ten years after
the Adoption Date.

3.8                                     The number of Shares over which an Option is granted
to any Eligible Employee must be so limited that the aggregate of the Exercise
Price for those Shares does not exceed the Repayment under the Savings Contract
entered into on the grant of such Option.

3.9                                     In determining the number of Shares over which an
Option will be granted the Repayment will be converted to GB pounds Sterling at
the exchange rate prevailing as at the date on which the Exercise Price is
fixed in accordance with Rule 5.1(a) or, where appropriate, for the purposes of
Rule 5.2, as at such date as is agreed in writing with the Revenue
Commissioners.

3.10                               For the purposes of Rules 3.1 and 3.2 above, an
invitation shall be sufficiently given if delivered to an Eligible Employee
personally or sent to him at his place of work by electronic mail or facsimile
transmission or sent by prepaid post addressed to the Eligible Employee at his
address last known to the Company (including any address supplied by the
relevant Participating Company or any Subsidiary as being his address) or sent
through the Company’s internal postal service and such application made
pursuant to an invitation shall be sufficiently given if returned to the
Company or its duly appointed agent in person or sent by electronic mail or
facsimile transmission to the Company or its duly appointed agent or sent by
prepaid post addressed to the Company or returned to the Company through the
Company’s internal postal service duly completed by the Eligible Employee on or
before  such date as shall be specified
in the invitation but in any event no application shall be duly received until
the signed original application is actually received by the Company or its duly
appointed agent prior to the expiry of the Application Period (unless the
Company directs otherwise).

4.                                           Limitations on the issue of
Shares

4.1                                     Subject to Rule 6 below, no Option shall be granted on
any Date of Grant or proposed Date of Grant if, as a result:

(a)                            the total number of Shares acquired or which may be
acquired during the ten years preceding such Date of Grant under this Plan and
under all other Employees’ Share Schemes established by the Company would
exceed ten per cent. of the issued ordinary share capital of the Company on
that Date of Grant; or

(b)                           the total number of Shares acquired or which may be
acquired during the preceding five years under the Plan and under all other
Employees’ Share Schemes established by the Company would exceed five per cent.
of the issued ordinary share capital of the Company on that Date of Grant;

PROVIDED that, for the avoidance of doubt, Shares
which shall have been the subject of Options which have lapsed shall not be
taken into account for the purposes of this Rule 4.

 5
 

5.                                           Exercise Price

5.1                                     Subject to Rule 6 below the Exercise Price shall be
such amount as the Board shall determine being an amount not less than the
greater of:

(a)                            subject to Rule 5.2, 80 per cent. of the middle market
quotation per Share as derived from the Daily Official List of the London Stock
Exchange for the dealing day immediately preceding the Invitation Date; and

(b)                           in the case of an Option to subscribe for Shares, the
nominal value of a Share.

5.2                                     For the purposes of an Option granted at any other
time at which there shall be no dealings in the Shares, the Exercise Price
shall be not less than 80 per cent. of such sum as may be agreed in writing by
the Revenue Commissioners in advance for the purposes of the Plan to be the
market value of a Share in accordance with Section 548 of the Act.

6.                                           Adjustment of Options

6.1                                     In the event of any variation in the share capital of
the Company whether by way of capitalisation of profits or reserves or by way
of rights or any consolidation or sub-division or reduction of capital, or
otherwise, then the number of Shares subject to any Subsisting Option and the
Exercise Price may be adjusted by the Board in such manner and with effect from
such date as the Board may determine to be appropriate provided always that:

(a)                            any such adjustment shall not take effect without the
prior approval in writing of the Revenue Commissioners;

(b)                           no such adjustment shall take effect until it has been
referred to the Auditors and the Auditors have certified in writing to the
Board that the adjustment is fair and reasonable in their opinion;

(c)                            the Exercise Price of an Option to subscribe for
Shares shall not be adjusted below the nominal value of a Share unless and to
the extent that:

(i)                              the Board is authorised to capitalise from the
reserves of the Company a sum equal to the amount by which the nominal value of
the Shares subject to the Option exceeds the aggregate adjusted Exercise Price;
and

(ii)                           the Board shall resolve to capitalise and apply such
sum on exercise of that Option.

7.                                           Exercise of Options

7.1                                     An Option shall be exercisable during the period
mentioned in Rule 7.3 below in respect of all or some of the Shares over which
it was granted by the Participant forwarding written details specifying the
number of Shares in respect of which the Option is exercised, a remittance in
Euros for that number of Shares calculated by reference to the Exercise Price
and evidence of the amount of the Repayment under the Savings Contract.  The date of exercise of the Option shall be
the date of receipt by the Company or the Trustee (acting as agent of the
Company) of such notice and payment.

7.2                                     It is a condition of the exercise of an Option under
the Plan that payment for the Shares shall be made only with monies not
exceeding the sterling equivalent of the amount of the Repayment to the
Participant under the Savings Contract to which he has contributed in relation
to the Option.  If upon the exercise of
an Option the sterling equivalent amount of the Repayment then due to a Participant
under his Savings Contract is less than the amount required to pay for all the
Shares in respect of which it is purportedly exercised, the Option shall be
treated as exercised only in respect of such number of Shares as may

 6
 

be
acquired by the sterling equivalent of the amount of the Repayment and shall
lapse as to the excess.

For the purposes of this Rule 7.2, references to the
sterling equivalent of any amount of the Repayment means the sterling
equivalent determined by the Board by reference to such published rate of
exchange between GB pounds Sterling and Euros as may be made available to the
Board on or about the date of exercise of the Option and which the Board
determines in its discretion to be appropriate.

7.3                                     Save as otherwise provided, an Option may not be
exercised until the Bonus Date.  Subject
only to the provisions of Rule 7.8 below, no Option may be exercised later than
six months after the Bonus Date.

7.4                                     Notwithstanding any other provision hereof no Option
may be exercised at any time when the person seeking to exercise it is excluded
from participation in this Plan by virtue of either of paragraphs 8 and 9 of
Schedule 12A.

7.5                                     An Option shall cease to be exercisable upon the
Participant ceasing to be an employee or director of any member of the Group
(so as to hold no such employment or office) except where his so ceasing is by
reason of:

(a)                            his retirement on reaching the Specified Age; or

(b)                           injury, disability or redundancy within the meaning of
the Redundancy Payments Acts 1967 - 1991 or his office or employment either
being in a company which ceases to be a Subsidiary or relating to a business or
part of a business which is transferred to a person who or which is neither a
Subsidiary nor a Participating Company; or

(c)                            his leaving service at any time other than at a time
specified in Rule 7.5(a) or (b) above, provided that such event occurs not
earlier than three years from the Date of Grant of the Option;

in any of which circumstances the Option may be
exercised at any time during the period of six months from the date on which he
so ceases to be an employee or director of any member of the Group
notwithstanding that the Bonus Date shall not have occurred.

7.6                                     For the purposes of Rule 7.5, if, at the Bonus Date, a
Participant holds an office or employment in a company which is not a
Participating Company but which is:

(a)                            an Associated Company of the Company, or

(b)                           a company of which the Company has Control,

the Participant may exercise his Option within six
months of that Bonus Date.

7.7                                     For the purposes of Rules 7.5 and 7.6 above and Rule 9
below (but for no other purpose):

(a)                            a Participant shall not be regarded as ceasing to hold
office or employment by reason of:

(i)                              his being or becoming employed by a company which
ceases to be or is not a Participating Company but is nevertheless an
Associated Company or is under the Control of the Company; or

(ii)                           his ceasing to be employed full-time but continuing to
be employed on a part-time basis; and

(b)                           a Participant shall be regarded as ceasing to hold
office or employment when he holds no employment with the Company, any
Associated Company and any company Controlled by the Company.

 7
 

7.8                                     In the event of the death of a Participant prior to
the Bonus Date the Option may be exercised by his personal representatives at
any time during the period of twelve months commencing on the date of his death
(but not later) and the personal representatives shall be entitled to do so
notwithstanding that the Bonus Date has not occurred and in the event of the
death of a Participant within six months commencing on the Bonus Date his
personal representatives may exercise the Option at any time within twelve
months commencing on the Bonus Date 
PROVIDED THAT  such personal
representatives shall not be entitled to exercise the Option if at the date of
the Participant’s death the Participant was precluded from exercising the
Option by reason of either of paragraphs 8 and 9 of Schedule 12A.

7.9                                     A Participant who reaches the Specified Age prior to
the Bonus Date but continues to hold the office or employment by virtue of
which he is eligible to participate in the Plan may exercise the Option within
six months after the date of his reaching the Specified Age.

7.10                               If an Option becomes exercisable under any provision
of the Plan before the Bonus Date it shall be exercisable only over the number
of Shares the aggregate Exercise Price of which equals (as nearly as may be)
but does not exceed the sterling equivalent of the Repayment made under the
Savings Contract entered into on the 
grant of that Option but excluding any contributions made directly by
the Participant except to the extent that such are:

(a)                            made pursuant to any special arrangements relating to
absence from employment; or

(b)                           made at the same rate of contribution and at the same
intervals as those contributions previously deducted from his salary pursuant
to the provisions of Rule 3.3(b)(ii) between the date of the Participant
ceasing to be employed by the Group and the date on which the Option is exercised;

and the Option
shall cease to be exercisable over any Shares in excess of that number in
respect of which it was granted.  For the
avoidance of doubt, any Repayment under the Savings Contract shall exclude the
Repayment of any contributions made in advance under the Savings Contract the
due date for payment of which falls or would have fallen more than one month
after the date on which Repayment is made.

7.11                               An Option shall be exhausted and automatically
cancelled immediately after it is first exercised notwithstanding that it shall
not have been exercised in respect of all of the Shares over which the Option
was granted.

8.                                           Lapse of Options

8.1                                     A Participant’s Option shall lapse and cease to be
exercisable:

(a)                            upon the expiry of any of the periods for exercise
under the provisions of Rule 7 (with the exception of paragraph 7.9 thereof)
above and Rule 9 below, whichever shall first occur; or

(b)                           if the Participant omits seven or more times to make a
monthly payment due under his Savings Contract or gives notice under the
Savings Contract requiring Repayment before the Bonus Date unless such
non-payment or notice is in consequence of his ceasing to be an Eligible
Employee by virtue of one of the causes mentioned in Rule 7.5, Rule 7.6, Rule
7.8 or Rule 7.9 above or in the circumstances of Rule 9 below.

9.                                           Take-over and Liquidation

9.1                                     If any person obtains Control of the Company as a
result of making:

 8
 

(a)                            a general offer to acquire the whole of the issued
share capital of the Company which is made on a condition such that if it is
satisfied the person making the offer will have Control of the Company; or

(b)                           a general offer to acquire all the shares in the
Company which are of the same class as the Shares;

then any
Subsisting Option may subject to Rule 9.4 below be exercised within six months
of the time when the person making the offer has obtained Control of the
Company and any condition subject to which the offer is made has been
satisfied.

9.2                                     If under Section 425 of the UK Companies Act 1985 the
Court sanctions a compromise or arrangement proposed for the purposes of or in
connection with a scheme for the reconstruction of the Company or its
amalgamation with any other company or companies, any Subsisting Option may
subject to Rule 9.4 below be exercised within six months of the Court
sanctioning the compromise or arrangement.

9.3                                     If any person becomes bound or entitled to acquire
shares in the Company under Sections 428 to 430 of the UK Companies Act 1985
any Subsisting Option may subject to Rule 9.4 below be exercised at any time
when that person remains so bound or entitled.

9.4                                     If as a result of the events specified in Rule 9.1 or
Rule 9.2 above a company has obtained Control of the Company, or if a company
has become bound or entitled as mentioned in Rule 9.3 above, any Participant
may by agreement with that other company (the “Acquiring
Company”) within the appropriate period as defined in paragraph
16(2) of Schedule 12A release any Subsisting Option of his in
consideration  of the grant of a new Option
(the “New Option”) which satisfies the
following conditions:

(a)                            the New Option shall be over shares in the Acquiring
Company or another company which satisfies paragraph (b) or (c) of Paragraph 11
of Schedule 12A in relation to the Acquiring Company and shall satisfy the
conditions specified in paragraphs 11 to 15 inclusive of Schedule 12A;

(b)                           the New Option shall be a right to acquire such number
of such shares in the Acquiring Company (or such other company) as shall have
on the grant of the New Option an aggregate market value equal to the aggregate
market value of the Shares subject to the Option immediately before its release
and for this purpose market value shall be ascertained by the application of
Rule 5.1 as at the date of release of the Option and grant of the New Option;

(c)                            the New Option shall have an Exercise Price such that
the aggregate price payable on complete exercise equals the aggregate price
which would have been payable on complete exercise of the Option; and

(d)                           the New Option shall
be otherwise identical in terms to the Option

AND the New
Option shall, for all other purposes of this Plan, be treated as having been
acquired at the same time as the Option in consideration of the release of
which it is granted.  With effect from the
release of any Option pursuant to this Rule 9, Rules 6, 7.1 and 7.2, this Rule
9 and Rule 10 of this Plan shall in relation to the New Option be construed as
if references therein to “the Company” were
references to the Acquiring Company or, as the case may be, such other company
and all the Rules (other than Rules 3 to 5 inclusive) shall in relation to the
New Option be construed as if references therein to Shares were references to
shares in the Acquiring Company or, as the case may be, such other company in
respect of whose shares the New Option is granted.

9.5                                     If the Company passes a resolution for voluntary
winding up, any Subsisting Option may be exercised within six months of the
passing of the resolution.

 9
 

9.6                                     For the purposes of this Rule 9 other than paragraph
9.4 above a person shall be deemed to have obtained Control of a Company if he
and others acting in concert with him have together obtained Control of it.

9.7                                     The exercise of an Option pursuant to the preceding
provisions of this Rule 9 shall be subject to the provisions of Rule 7 above.

9.8                                     Any Option shall lapse if:

(a)                            it shall not have been exercised by the expiry of any
time limit for exercise set out in this Rule 9, whichever shall expire first;
and

(b)                           no agreement for the release of the Option shall have
been entered into by the expiry of the first Appropriate Period to commence
pursuant to Rule 9.4 above.

10.                                     Allotment and Listing

10.1                               Subject to receipt of the appropriate remittance:

(a)                            Shares to be issued pursuant to the exercise of an
Option will be allotted as soon as practicable after the exercise of the Option
and will rank pari passu in all respects with the Shares in issue on the date
of exercise save that they will not rank for any dividend or other distribution
paid or made by reference to the date (known as the record date) on which
entitlement to the dividend or distribution is fixed by reference to the
Company’s register of members if that date falls prior to the date of exercise
of the Option; and

(b)                           in the case of Shares to be transferred pursuant to
the exercise of an Option, the Board or Trustee, as appropriate, shall transfer
or procure that the Shares shall be transferred as soon as practicable after
exercise of the Option, save that such Shares will not rank for any dividend or
other distribution paid or made by reference to the date (known as the record
date) on which entitlement to the dividend or distribution is fixed by
reference to the Company’s register of members if that date falls prior to the
date of exercise of the Option.

10.2                               If the Shares are listed on the London Stock Exchange
at the date of allotment of any Shares pursuant to the Plan the Company will
apply to the London Stock Exchange for permission for such Shares so allotted
to be admitted to the Official List.  An
application may be postponed at the 
discretion of the Board until application can be made in respect of such
number of Shares as the Board considers appropriate.

11.                                     Employment Rights

11.1                               This Plan shall not form part of any contract of employment
between any member of the Group and any employee of any such company and the
rights and obligations of any individual under the terms of his office or
employment with any member of the Group shall not be affected by his
participation in the Plan or any right which he may have to participate
therein.

11.2                               Participation in the Plan shall be on the express
condition that:

(a)                            neither it nor cessation of participation shall afford
any individual under the terms of his office or employment with any member of
the Group any additional or other rights to compensation or damage; and

(b)                           no damages or compensation shall be payable in
consequence of the termination of such office or employment (whether or not in
circumstances giving rise to a claim for wrongful or unfair dismissal) or for
any other reason whatsoever to compensate him for the loss of any rights the
Participant would otherwise have had (actual or prospective) under the Plan
howsoever arising but for such termination; and

 10
 

(c)                            the Participant shall be deemed irrevocably to have
waived any such rights to which he may otherwise have been entitled.

11.3                               No individual shall have any claim against a member of
the Group arising out of his not being admitted to participation in the Plan
which (for the avoidance of any doubt) is governed entirely by the Rules.

11.4                               No Participant shall be entitled to claim compensation
from any member of the Group in respect of any sums paid by him pursuant to the
Plan or for any diminution or extinction of his rights or benefits (actual or
otherwise) under any Option held by him consequent upon the lapse for any
reason of any Option held by him or otherwise in connection with the Plan and
each member of the Group shall be entirely free to conduct its affairs as it
sees fit without regard to any consequences under, upon or in relation to the
Plan or any Option or Participant.

11.5                               By accepting the grant of an Option under the Plan,
the Eligible Employee shall authorise and consent to the collection,
processing, exchange, transfer (including to countries outside the European
Economic Area which may not have the same level of data protection laws as in
Ireland) and retention of his personal data in connection with the operation
and implementation of the Plan by the Company, any member of the Group, the
Trustee and/or any third party as may be retained by the Board from time to
time to administer the Plan.

12.                                     Administration of the Plan

12.1                               The Board may make and vary such regulations (not
being inconsistent with the Plan) as it thinks fit for the administration and
implementation of the Plan.  The Board’s
decision on any matter concerning the Plan or its interpretation (including the
rectification of errors or mistakes of procedure or otherwise) (other than a
matter to be certified by the Auditors of the Company) shall be final and
binding.  In any matter in which they are
required to act hereunder, the Auditors shall be deemed to be acting a experts
and not as arbitrators and their decisions shall be final and binding.

12.2                               The Board shall be entitled by resolution to amend all
or any of the provisions of the Plan as the Board thinks fit except that no
alteration shall be made:

(a)                            to the advantage of Participants to any of the
provisions of the Plan relating to:

(i)                              eligibility;

(ii)                           the limitations on the number or amount of Shares,
cash or other benefits subject to the Plan;

(iii)                        the maximum entitlement of any one Participant;

(iv)                       the basis for determining a Participant’s entitlement
to, and the terms of, Shares, cash or other benefits to be provided under the
Plan and for the adjustment thereof (if any) in the event of a capitalisation
issue, rights issue or open offer, sub-division or consolidation of Shares or
reduction of capital or any other variation of capital;

(b)                           without the prior sanction of an ordinary resolution
of the Company in general meeting except for minor amendments to benefit the
administration of the Plan and amendments to obtain and maintain favourable
tax, exchange control or regulatory treatment for Participants in the Plan or
for any member of the Group;

(c)                            to any rights already accrued to any Participant which
would be to the disadvantage of such Participant, without the prior consent of
the majority of the affected Participants; or

 11
 

(d)                           in relation only to Options to purchase Shares,
without the prior consent of the Trustee;

unless, in any
such case, the alteration is necessary to comply with any legislation for the
time being in force or with any conditions requisite to obtain or to maintain
approval of the Revenue Commissioners for the Plan AND provided that, at any
time at which the Plan is and is intended to remain so approved by the Revenue
Commissioners, no amendment shall take effect unless and until such amendment
shall have been approved in writing by the Revenue Commissioners.

12.3                               Unless otherwise provided in these Rules, any notice
or other communication under or in connection with the Plan may be given:

(a)                            by the Company to an Eligible Employee or Participant
either personally or sent to him at his place of work by electronic mail or by
post addressed to the address last known to the Company (including any address
supplied by the relevant Participating Company or any Subsidiary) or sent
through the Company’s internal postal service; and

(b)                           to the Company either personally or by post to the
Company Secretary (or its duly appointed agent).

Items sent by
post shall be pre-paid and shall entirely be at the Eligible Employee’s
risk.  Any notice or other communication
to the Company shall not be deemed to have been duly received until it is
actually received by the Company or its duly appointed agent (unless the
Company directs otherwise).

12.4                               Written notice of any alteration made in accordance
with Rule 12.2 shall be given to all Participants.

12.5                               The Company shall keep available sufficient issued
and/or unissued Shares in the capital of the Company to satisfy the exercise in
full of all Options for the time being remaining capable of being exercised.

12.6                               Participants shall be sent copies of any document
having a material effect on their rights at the same time as such document is
sent to holders of Shares.

12.7                               The provisions of the Company’s Articles of
Association for the time being in force with regard to the service of notices
upon members of the Company shall apply mutatis mutandis to any notice to be
given by the Company to Participants. 
Any notice to be given by the Trustee to any Participant or Eligible
Employee shall be sufficiently given if sent to his home address or place of
work as last reported in writing to the Trustee by the Company.

12.8                               Notwithstanding anything to the contrary contained
herein the Board may at any time and from time to time by resolution and
without further formality amend the Plan in any way to the extent necessary to
render the Plan capable of approval by the Revenue Commissioners or any other
governmental or other regulatory body pursuant to any present or future Irish
legislation.

12.9                               The cost of the preparation of this Plan shall be
borne by the Irish Participating Companies in such proportions as are agreed
with the Company.

12.10                         The costs of operation and administration of this Plan
shall be borne by the Irish Participating Companies in such proportions as are
agreed from time to time with the Company on such basis as determined by the
Company.

12.11                         The Board shall be entitled to authorise any person to
execute on behalf of a Participant, at the request of the Participant, any
document relating to the Plan, in so far as such document is required to be executed
pursuant hereto.

 12
 

12.12                         If any Option certificate shall be worn out, defaced
or lost, it may be replaced on such evidence being provided as the Board may
require.

12.13                         The Board may in its discretion delegate any of its
functions under the Scheme as it thinks fit to the Trustee, including:

(a)                            the determination of whether to invite applications
for the grant of options in accordance with Rule 3.1; and

(b)                           the granting of Options to the Eligible Employees of
the Plan in accordance with Rule 3.4.

12.14                         The Plan shall be subject to, governed by and
construed in accordance with Irish law.

13.                                     Termination of the Plan

The Plan may be terminated at any time by the Board or
by the Company in general meeting but in any event shall terminate on the tenth
anniversary of the Adoption Date of the Plan and on such termination no further
Options shall be granted, but the subsisting rights of Participants shall not
be affected by such termination.

 13
 

Imperial
Tobacco Group plc

IRISH
SHARESAVE PLAN

 

OPTION CERTIFICATE

Name of Option Holder

Address of Option Holder

 

 

	
  

  	
   

  	
  Post Code

  	
   

  	
   

  

 

Option Holder’s PPS number

Option Certificate number

Number of shares granted under this option

Date of grant

This is to
certify that the above named person was on the above date granted an option as
specified for ordinary shares of [  ]p
each in the capital of Imperial Tobacco Group PLC at an exercise price of
[     ]p per share upon and subject to
the terms of the Imperial Tobacco Group PLC Irish Sharesave Plan adopted
pursuant to a resolution of Imperial Tobacco Group PLC in general meeting on [·].

Signed on behalf of

	
  

  	
   

  	
  Director

  	
   

  	
  Secretary

  

 

NOTES:   (1)         The option cannot be assigned or transferred.

 [(2)         In
order to exercise your option please send this Option Certificate together with
a request for a cheque for the relevant exercise price of the shares and
evidence of the amount repaid under your Sharesave contract to the [insert name
of savings carrier]  (or such other
person as shall have been notified to you)]. 
* To be agreed with savings carrier.

THIS DOCUMENT
MUST BE RETAINED.  PLEASE KEEP IT IN A
SAFE PLACE.  This certificate is issued
as a matter of record only and is not a document of title.

 14Exhibit
4.7

IMPERIAL TOBACCO GROUP PLC

 

RULES OF THE IMPERIAL TOBACCO GROUP

BONUS MATCH PLAN

 

(Approved by the Remuneration Committee on 22 November 2002)

 

(Amended by the Remuneration Committee on 14 November 2003)

 

(Amended by the Remuneration Committee on 22 April 2005)

 

RULES OF
THE IMPERIAL TOBACCO GROUP

BONUS MATCH PLAN

	
  1.

  	
  Definitions

  
	
   

  	
   

  
	
   

  	
  The following words and expressions shall have the
  following meanings:-

  
	
   

  	
   

  
	
  “Board”

  	
  the duly constituted Remuneration Committee of the
  Board of directors of the Company;

  
	
   

  	
   

  
	
  “Company”

  	
  Imperial Tobacco Group PLC;

  
	
   

  	
   

  
	
  “Control”

  	
  as defined in section 840 of the Income and
  Corporation Taxes Act 1988;

  
	
   

  	
   

  
	
  “Early Vesting Date”

  	
  as defined at Rule 4.2;

  
	
   

  	
   

  
	
  “Employee”

  	
  any person other than a director of Imperial Tobacco
  Group PLC for the time being in full, part-time or temporary employment of
  any Member of the Group;

  
	
   

  	
   

  
	
  “Exit Price”

  	
  the middle market price of a Share as derived from
  the London Stock Exchange Daily Official List on the Vesting Date;

  
	
   

  	
   

  
	
  “Expected Vesting Date”

  	
  as defined at Rule 4.1;

  
	
   

  	
   

  
	
  “Group”

  	
  the Company and its Subsidiaries;

  
	
   

  	
   

  
	
  “Member of the Group”

  	
  the Company or any of its Subsidiaries;

  
	
   

  	
   

  
	
  “Model Code”

  	
  the Model Code on directors’ and relevant employees’
  dealings in securities as set out in the listing rules published by the UK
  Listing Authority;

  
	
   

  	
   

  
	
  “Notional Additional Gain”

  	
  the Exit Price multiplied by the number of Notional
  Additional Shares allocated to a Participant reduced by £0.02 per Notional
  Additional Share for every £0.01 that the Exit Price is less than the
  Notional Share Price of the related Notional Lodged Shares;

  
	
   

  	
   

  
	
  “Notional Additional Share”

  	
  a notional share allocated pursuant to Rule 2.5;

  
	
   

  	
   

  
	
  “Notional Lodged Share”

  	
  a notional share allocated pursuant to Rule 2.4;

  
	
   

  	
   

  
	
  “Notional Share Price”

  	
  for any day determined by the Board for the purpose
  of allocating Notional Lodged shares under the Plan, the middle market price
  of a Share as derived from the London Stock Exchange Daily Official List on
  that day;

  
			

 

 1
 

 

	
  

  	
   

  
	
  “Participant”

  	
  an Employee who is holding monies in a bank account
  pursuant to Rule 2.3;

  
	
   

  	
   

  
	
  “Plan”

  	
  the Imperial Tobacco Group Bonus Match Plan
  constituted by these Rules;

  
	
   

  	
   

  
	
  “Rules”

  	
  these Rules as from time to time amended in accordance
  with their provisions;

  
	
   

  	
   

  
	
  “Share”

  	
  an ordinary share in the capital of the Company;

  
	
   

  	
   

  
	
  “Subsidiary”

  	
  a subsidiary or subsidiary undertaking of the
  Company within the meaning of the Companies Act 1985;

  
	
   

  	
   

  
	
  “Vesting Date”

  	
  the earlier of the Expected Vesting Date and Early
  Vesting Date; and

  
	
   

  	
   

  
	
  “Vesting Period”

  	
  with respect to a Notional Additional Share the
  period between its allocation under Rule 2.5 and its Vesting Date.

  

 

2.                                          Invitations

2.1                                    The
Board may, from time to time, invite any Employee to participate in the Plan.

2.2                                    Any
such invitation shall:-

(a)                              invite
such Employees as the Board may in its discretion determine to deposit monies
(in Sterling or in a local currency and on such other terms (if any) as
determined by the Board) with:

(i)                              a
bank account held with Abacus (C.I.) Limited; or

(ii)                           a
bank account designated by the Board; and

(b)                             advise
such Employees of the proposed basis of allocation of Notional Additional
Shares if they accept the invitation.

2.3                                    An
Employee invited to participate in the Plan may accept the invitation by
depositing monies in a specified bank account in the manner and within the time
prescribed by the invitation.

2.4                                    As
soon as practicable following confirmation of the amount deposited by an
Employee who accepts an invitation under Rule 2.2 the Board shall allocate
Notional Lodged Shares to the Participant by dividing the monies deposited by
the Participant by the applicable Notional Share Price.

2.5                                    Following
the allocation of Notional Lodged Shares to a Participant under Rule 2.4 the
Board shall allocate Notional Additional Shares to that Participant in respect
of the Notional Lodged Shares on such basis (including as to vesting) as the
Board may in its discretion determine based on length of service with the
Group, the Earnings of a Participant, the

 2
 

financial performance of the Group or otherwise howsoever PROVIDED THAT
the maximum aggregate number of Notional Additional Shares which may be
allocated to a Participant in respect of an invitation shall not exceed the
total number of Notional Lodged Shares allocated to the Participant under the
Plan in respect of that invitation.

2.6                                    No
invitation shall be made to an Employee at a time when that Employee is
prohibited from dealing (as defined in paragraph 1 of the Model Code) in Shares
by the Model Code.

3.                                          Effect of Allocation

3.1                                    Any
Notional Lodged Share and Notional Additional Share allocated to a Participant
will be held for that Participant provided that the Participant, throughout the
period commencing on the date of allocation of such Notional Lodged Share and
Notional Additional Share and ending on their Vesting Date:-

(a)                              remains
employed continuously under a contract of employment with any Member of the
Group and no notice of termination of such contract is given or received; and

(b)                             does
not withdraw any of the monies held in a bank account pursuant to Rule 2.2 in
respect of which the allocation of Notional Lodged shares was made.

4.                                          Vesting of Notional Lodged Shares and Notional Additional Shares

4.1                                    Save
as otherwise provided, and provided, in the case of Notional Additional Shares
that any performance condition imposed by the Board under Rule 2.5 has been
satisfied or waived in accordance with its terms, “Expected Vesting Date” in
relation to any Notional Lodged Shares and Notional Additional Shares means the
date after the allocation of the Notional Additional Shares determined by the
Board before that allocation.  If an
event occurs as a result of which the Board determines that in relation to all,
or any Notional Lodged Shares or Notional Additional Shares previously
allocated the Expected Vesting Date is no longer appropriate, the Board may in
its discretion substitute such other date as it may determine as the Expected Vesting
Date.

4.2                                    Provided,
in the case of Notional Additional Shares, that any performance condition
imposed by the Board under Rule 2.5 has been satisfied or waived in accordance
with its terms, “Early Vesting Date” in relation to any Notional Lodged Shares
and Notional Additional Shares means the date on which any of the following
events shall first occur prior to the Expected Vesting Date of such Notional
Lodged Share and Notional Additional Share:-

(a)                              any
person acquiring Control of the Company (including for the avoidance of doubt
pursuant to an amalgamation or reconstruction, however effected, or a
compromise or a Plan of arrangement sanctioned by the Court under Section 425
of the Companies Act 1985);

(b)                             notice
being duly given of a resolution for the voluntary winding-up of the Company;

(c)                              death
during service of the Participant; or,

 3
 

(d)                             cessation
of the Participant’s employment by reason of:-

(i)                              ill
health, injury, disability or redundancy;

(ii)                           the
company employing the Participant ceasing to be a Member of the Group;

(iii)                        the
business or part of the business to which the Participant’s office or
employment relates being transferred to a person who is not a Member of the
Group;

(iv)                       any
other circumstances.

(e)                              notice
being given that the Shares will cease to be listed on the London Stock
Exchange.

4.3                                    For
the purposes of this Rule 4, where a Participant’s employment with any Member
of the Group is terminated without notice the Participant’s employment shall be
deemed to cease on the date on which the termination takes effect and where the
said employment is terminated with notice the Participant’s employment shall be
deemed to cease on the date on which that notice is given unless the Board in
its sole discretion shall agree to extend the date on which the employment is
deemed to cease to the date when the notice expires.

5.                                          Payments

5.1                                    Any
monies held in a bank account pursuant to Rule 2.2 in respect of an allocation
of Notional Lodged shares shall be transferred as soon as practicable (in such
manner as the Board may determine) to the relevant Participant following the
Vesting Date of those Notional Lodged shares.

5.2                                    Save
as otherwise provided, on the Expected Vesting Date of any Notional Lodged
shares and Notional Additional Shares a payment shall be made to the
Participant equal to the aggregate of:-

(a)                              an
amount equal to the Exit Price multiplied by the number of those Notional
Lodged Shares less the monies deposited in a bank account by that Participant
pursuant to Rule 2.2 in respect of those Notional Lodged shares; and

(b)                             the
Notional Additional Gain calculated for those Notional Additional Shares.

5.3                                    If
the Vesting Date of any Notional Lodged Shares has arisen under Rule 4.2  payment shall be made to the Participant on
or as soon as practicable after the Vesting Date of an amount calculated by
mutiplying the Exit Price by the number of those Notional Lodged Shares less
the monies deposited in a bank account by that Participant pursuant to Rule 2.2
in respect of those Notional Lodged Shares.

 4
 

5.4                                    If
the Vesting Date has arisen:

(a)                              under
Rule 4.2(d)(iv) any allocation of Notional Additional Shares to that
Participant shall lapse unless, within six months of that date, the Board shall
determine otherwise, in which case a payment shall be made to the Participant of
an amount determined by the Board in its discretion, but not exceeding the
Notional Additional Gain which the Participant would have been entitled to had
the Vesting Date arisen otherwise than under Rule 4.2(d)(iv); or

(b)                             under
Rule 4.2(a) or (b), a Participant will be paid on or as soon as practicable
after the Vesting Date that proportion of the Notional Additional Gain as is
equal to the proportion of the Vesting Period of those Notional Additional
Shares that had expired at the occurrence of the event that gave rise to the
Vesting Date of those Notional Additional Shares; or

(c)                              under
Rules 4.2(c) or (d)(i), (ii) or (iii) a Participant (or the Participant’s
estate) will be paid on or as soon as practicable after the Vesting Date that
proportion of the Notional Additional Gain as is equal to the proportion of the
Vesting Period of those Notional Additional Shares for which the Participant remained
an Employee.

5.5                                    For
the avoidance of doubt, if. in respect of a Participant’s allocation of
Notional Lodged Shares, their Exit Price multiplied by the number of Notional
Lodged Shares is less than the monies held in a bank account by that
Participant pursuant to Rule 2.2 in respect of those Notional Lodged Shares no
payment shall be made in relation to those Notional Lodged Shares.

5.6                                    Benefit
received by a Participant under the Plan are not pensionable.

6.                                          Capital Reorganisation

6.1                                    If
there is any capital reorganisation of the Company including a capitalisation
issue, rights issue or rights offer, consolidation or sub-division or any
variation of share capital, or any special dividend, reconstruction or
demerger, a Notional Lodged Share and/or or a Notional Additional Share may be
adjusted in the manner the Company’s auditors, acting as experts and not as
arbitrators, confirm in writing to be fair and reasonable.

6.2                                    Participants
shall be notified of any adjustment.

6.3                                    If
for any fraction of a Notional Lodged Share or a Notional Additional Share
arises for allocation under Rule 6.1, it may be rounded up or down as the Board
thinks fit.

7.                                          Taxation

7.1                                    The
Company and any Member of the Group may make such provision for and take such
action as may be considered by either of them to be necessary or expedient for
the withholding or payment of any taxes or any other statutory deductions for
which either of them is properly accountable and wherever those taxes are
imposed, provided those taxes arise in respect of any payment pursuant to the
Rules including (but not limited to) the withholding of funds from any payment
under these Rules until a Participant reimburses the

 5
 

Company or any Member of the Group for the amounts of any such taxes
for which it is properly accountable.

7.2                                    For
the purposes of this Rule 7 the Company and any Member of the Group may rely on
any information supplied to them by any other Member of the Group or by any tax
adviser selected by either of them as to the amount of any such tax liability.

8.                                          General

8.1                                    Any
notice or other document given to any Employee pursuant to the Plan shall be
delivered to him, sent by post to him at his home address according to the
records of his employing company or such other address as may appear to the
Board to be appropriate or sent to him by e-mail to his usual e-mail address
according to the records of his employing company or to such other e-mail
address that the Employee may have advised may be used.  Notices or other documents sent by post shall
be deemed to have been received 2 days following the date of posting for
documents posted to addresses in the United Kingdom and 7 days for documents
posted to an overseas address.  All
documents sent to or by an Employee will be sent entirely at the employee’s
risk.

8.2                                    The
decision of the Board on any question of interpretation of the Rules or any
dispute relating to or connected with the Plan shall be final and conclusive.

8.3                                    The
costs of introducing, operating and administering the Plan shall be borne by
the Company.

8.4                                    The
Board shall have power from time to time to make regulations for the
administration and operation of the Plan provided that they are not
inconsistent with these Rules.

8.5                                    Nothing
in the Plan shall form part of any Participant’s contract of employment. The
rights and obligations of a Participant under the terms and conditions of his
employment by any Member of the Group shall not be affected by his
participation in the Plan.  The
Participant shall have no right to compensation or damages or any other sum or
benefit in respect of his ceasing to participate in the Plan or in respect of
any loss or reduction of any rights or expectations under the Plan in any
circumstances. An Employee who is not invited to participate in the Plan shall
have no right to compensation or damages or any other sum or benefit in respect
of his non-participation.

8.6                                    An
Employee agrees, as a condition of participation in the Plan, to the
collection, processing, transfer (including to countries outside the European
Economic Area) and retention of the Employee’s personal data for use in
connection with the operation of the Plan by any member of the Group and/or any
third party retained by the Board to administer the Plan.

9.                                          Amendment

9.1                                    The
Plan shall be administered under the direction of the Board who may at any time
and from time to time by resolution and without other formality amend or
augment the Rules or

 6
 

the Plan in any respect provided that no amendment shall operate to
affect adversely in any way any rights already acquired by a Participant
without the Participant’s consent.

9.2                                    Notwithstanding
anything to the contrary contained herein, the Board may at any time and from
time to time by resolution and without further formality amend the Plan in such
manner as the Board may consider necessary or desirable:

(a)                              in
any way to the extent necessary to render the Plan capable of approval by any
governmental or other regulatory body pursuant to any present or future United
Kingdom legislation;  or

(b)                             in
order to comply with, take advantage of, or otherwise in connection with any
taxation, legal, regulatory or other rule, law, guideline, regulation or other
provision of or prevailing in any jurisdiction in which this Plan is or is
intended to be operated.

10.                                    Termination

The Plan may be
terminated at any time by a resolution of the Board, and shall in any event
terminate on 1 February 2015.  Any
termination shall not affect the outstanding rights of Participants.

11.                                    Governing Law

This Plan shall be
governed by the laws of England.

 7
 

SCHEDULE
1

INTERNATIONAL
RULES

The Rules of the Plan
apply in the jurisdictions specified below:

Ivory Coast

Macedonia

Madagascar

Serbia

Slovenia

Ukraine

 8

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