REED ELSEVIER PLC (Form: S-8, Received: 05/25/2010 09:40:30)

As filed with the Securities and Exchange Commission on May 25, 2010.

Registration No. 333-______

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM S-8

REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933


REED ELSEVIER PLC (Exact name of Registrant as specified in its charter)		REED ELSEVIER NV (Exact name of Registrant as specified in its charter)
England (Jurisdiction of incorporation or organisation)		The Netherlands (Jurisdiction of incorporation or organisation)
Not Applicable (I.R.S. Employer Identification No.)		Not Applicable (I.R.S. Employer Identification No.)
1-3 Strand London WC2N 5JR England (Address of principal executive offices)		Radarweg 29 1043 NX Amsterdam The Netherlands (Address of principal executive offices)

Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan
Reed Elsevier Group plc Bonus Investment Plan 2010
Reed Elsevier Group plc Growth Plan
Reed Elsevier Group plc Long-Term Incentive Plan 2010
(Full Title of the Plan)

Henry Z. Horbaczewski
Reed Elsevier Inc.
125 Park Avenue
23rd Floor
New York, New York 10017
(Name and address, including zip code, and telephone number, including area code, of agent for service)

With copies to:

D. Rhett Brandon, Esq.
Simpson Thacher & Bartlett LLP
425 Lexington Avenue
New York, New York 10017-3954
Telephone: (212) 455-2000
Facsimile: (212) 455-2502

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer þ

Accelerated filer o

Non-accelerated filer o
(Do not check if a smaller reporting company)

Smaller reporting company o

CALCULATION OF REGISTRATION FEE

Title of

Proposed maximum

securities to be

Amount to be

offering price per

aggregate offering

Amount of

registered

registered (1)

share (2)

price (2)

registration fee (2)

Reed Elsevier PLC Ordinary Shares, nominal value 14 51/116 pence each (3)

18,000,000 shares

27.53

123,885,000

8,833.00

Reed Elsevier NV Ordinary Shares, nominal value 0.07 euros each (3)

12,000,000 shares

20.78

124,680,000

8,889.68


(1)		Covers shares under the Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan, the Reed Elsevier Group plc Bonus Investment Plan 2010, the Reed Elsevier Group plc Growth Plan and the Reed Elsevier Group plc Long-Term Incentive Plan 2010 (the “Plans”) and, pursuant to Rule 416 under the Securities Act of 1933, as amended (the “Securities Act”), an indeterminate number of additional shares which may be offered and issued pursuant to the Plans to prevent dilution resulting from stock splits, stock dividends or similar transactions.

(2)		Pursuant to Rule 457(c) and Rule 457(h) under the Securities Act, the proposed maximum offering price per share and the registration fee are based on the reported average of the high and low prices for the American Depositary Shares representing the Reed Elsevier PLC Ordinary Shares and the Reed Elsevier NV Ordinary Shares, as applicable, on the New York Stock Exchange on May 21, 2010.

(3)		Under certain circumstances, shares may be issued in the form of American Depositary Shares. A separate registration statement on Form F-6 (File No. 333-109805) is effective with respect to the American Depositary Shares represented by American Depositary Receipts issuable on a one-for-four basis for the Reed Elsevier PLC Ordinary Shares registered hereby upon deposit of such Ordinary Shares. A separate registration statement on Form F-6 (File No. 333-109804) is effective with respect to the American Depositary Shares represented by American Depositary Receipts issuable on a one-for-two basis for the Reed Elsevier NV Ordinary Shares registered hereby upon deposit of such Ordinary Shares.

TABLE OF CONTENTS


PART I
PART II
	Item 3. Incorporation of Documents by Reference.
	Item 4. Description of Securities.
	Item 5. Interests of Named Experts and Counsel.
	Item 6. Indemnification of Directors and Officers.
	Item 7. Exemption from Registration Claimed.
	Item 8. Exhibits.
	Item 9. Undertakings.
SIGNATURES
EX-4.1
EX-4.3
EX-4.4
EX-4.5
EX-4.6
EX-5.1
EX-5.2
EX-23.1
EX-23.2
EX-23.3

PART I

INFORMATION REQUIRED IN THE SECTION 10(a) PROSPECTUS

The information specified in Item 1 and Item 2 of Part I of the Registration Statement on Form S-8 (the “Registration Statement”) is omitted from this filing in accordance with the provisions of Rule 428 under the Securities Act and the introductory note to Part I of the Registration Statement. The documents containing the information specified in Part I will be delivered to the participants in the Plans covered by this Registration Statement as required by Rule 428(b)(1).

PART II

INFORMATION REQUIRED IN THE REGISTRATION STATEMENT

Item 3. Incorporation of Documents by Reference.

Reed Elsevier PLC and Reed Elsevier NV hereby incorporate by reference in this Registration Statement the following documents which are on file with the Securities and Exchange Commission (the “Commission”):

	(a)		The combined Annual Report of Reed Elsevier PLC and Reed Elsevier NV on Form 20-F filed pursuant to Section 13 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), for the fiscal year ended December 31, 2009;

	(b)		All other reports filed by Reed Elsevier PLC or Reed Elsevier NV, respectively, pursuant to Section 13(a) or 15(d) of the Exchange Act since December 31, 2009; and

	(c)		The description of the share capital of Reed Elsevier PLC and Reed Elsevier NV contained in the amended registration statement on Form 20-F/A, Registration No. 1-3334, filed with the Commission under the Exchange Act on September 22, 1994, as amended by the description of the Memorandum and Articles of Association in Item 10 of each of the following annual reports on Form 20-F: the annual report on Form 20-F for fiscal year 2000, filed with the Commission on March 13, 2001; the annual report on Form 20-F for fiscal year 2002, filed with the Commission on March 10, 2003; the annual report on Form 20-F for fiscal year 2005, filed with the Commission on March 16, 2006; the annual report on Form 20-F for fiscal year 2007, filed with the Commission on March 20, 2008; and the annual report on Form 20-F for fiscal year 2008, filed with the Commission on March 13, 2009 (including any additional amendments or reports filed for purposes of updating such description).

All documents filed by Reed Elsevier PLC and Reed Elsevier NV pursuant to Sections 13(a), 13(c), 14 and 15(d) of the Exchange Act after the date of this Registration Statement and prior to the filing of a post-effective amendment to this Registration Statement indicating that all securities offered have been sold or which deregisters all securities then remaining unsold, shall be deemed to be incorporated by reference into this Registration Statement and to be a part hereof from the date of filing of such documents.

Any statement contained in a document incorporated or deemed to be incorporated by reference herein shall be deemed to be modified or superseded for purposes of this Registration Statement to the extent that a statement contained herein or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein modifies or supersedes such statement. Any such statement so modified or superseded shall not be deemed, except as so modified or superseded, to constitute a part of this Registration Statement.

Item 4. Description of Securities.

Not applicable.

Item 5. Interests of Named Experts and Counsel.

Not applicable.

Item 6. Indemnification of Directors and Officers.

The United Kingdom Companies Act of 2006 (the “Act”) does not permit a company to indemnify a director or an officer of the company against any liability which by virtue of any rule of law would otherwise attach to him in respect of negligence, default, breach of duty or breach of trust in relation to the company. Subject to the provisions of the Act, but without prejudice to any indemnity to which the person concerned may otherwise be entitled, Reed Elsevier PLC’s Articles of Association provides that every director or officer of the Company shall be indemnified out of the assets of the Company against any liability incurred by him for negligence, default, breach of duty or breach of trust in relation to the affairs of the Company, to the extent that such indemnification would not be treated as void under the Act.

To the extent permissible by Dutch law, and subject to the provisions of Reed Elsevier NV’s Articles of Association, each member of the Executive Board and of the Supervisory Board shall be indemnified and held harmless against the financial consequences of any and all liabilities, claims, judgements, fines, expenses and penalties incurred as a result of any threatened, pending or completed action, investigation or other proceeding, whether civil, criminal brought by any party other then the Company itself or its Group companies, in relation to acts of omissions performed or committed in that person’s capacity as a member of the Executive Board or of the Supervisory Board.

Reed Elsevier PLC and Reed Elsevier NV have directors’ and officers’ liability insurance policies that insure directors and officers against the cost of defense, settlement or payment of claims and judgments under certain circumstances.

Item 7. Exemption from Registration Claimed.

Not applicable.

Item 8. Exhibits.

The following exhibits are filed as part of this Registration Statement:


4.1		Articles of Association of Reed Elsevier PLC (filed herewith)


4.2		Articles of Association of Reed Elsevier NV (incorporated by reference from Exhibit 1.2 to the 2009 Annual Report on Form 20-F filed with the Commission on March 18, 2010)

4.3		Reed Elsevier Group plc Bonus Investment Plan 2010, adopted by the directors of Reed Elsevier Group plc on April 21, 2010 (filed herewith)

4.4		Reed Elsevier Group plc Growth Plan, adopted by the directors of Reed Elsevier Group plc on April 21, 2010 (filed herewith)

4.5		Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan, adopted by the Reed Elsevier Group plc Remuneration Committee on June 24, 2009 (filed herewith)

4.6		Reed Elsevier Group plc Long Term Incentive Plan 2010, adopted by the directors of Reed Elsevier Group plc on April 21, 2010 (filed herewith)

5.1		Opinion of S.J. Cowden, General Counsel and Company Secretary of Reed Elsevier PLC, as to the validity of the Reed Elsevier PLC Ordinary Shares

5.2		Opinion of J. van der Woude, Company Secretary of Reed Elsevier NV, as to the validity of the Reed Elsevier NV Ordinary Shares

23.1		Consent of Deloitte LLP, London, England, regarding the consolidated financial statements of Reed Elsevier PLC

23.2		Consent of Deloitte Accountants B.V., Amsterdam, The Netherlands, regarding the consolidated financial statements of Reed Elsevier NV

23.3		Consent of Deloitte LLP, London, England, and Deloitte Accountants B.V., Amsterdam, The Netherlands, regarding the combined financial statements of Reed Elsevier PLC and Reed Elsevier NV

23.4		Consent of S.J. Cowden, General Counsel and Company Secretary of Reed Elsevier PLC, (included as part of Exhibit 5.1)

23.5		Consent of J. van der Woude, Company Secretary of Reed Elsevier NV, (included as part of Exhibit 5.2)

24.1		Powers of Attorney

Item 9. Undertakings.

(a) Each of the undersigned registrants hereby undertakes:

(1)

To file, during any period in which offers or sales are being made, a post-effective amendment to this Registration Statement:

(i)

To include any prospectus required by Section 10(a)(3) of the Securities Act.

	(ii)		To reflect in the prospectus any facts or events arising after the effective date of the Registration Statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the Registration Statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20 percent change in the maximum aggregate offering price set forth in the “Calculation of Registration Fee” table in the effective Registration Statement.

	(iii)		To include any material information with respect to the plan of distribution not previously disclosed in the Registration Statement or any material change to such information in the Registration Statement;

provided, however , that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if the information required to be included in a post-effective amendment by those paragraphs is contained in periodic reports filed with or furnished to the Commission by such registrant pursuant to Section 13 or 15(d) of the Exchange Act that are incorporated by reference in the Registration Statement.

	(2)		That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

	(3)		To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

(b) Each of the undersigned registrants hereby undertakes that, for purposes of determining any liability under the Securities Act, each filing of such registrant’s annual report pursuant to Section 13(a) or Section 15(d) of the Exchange Act that is incorporated by reference in this Registration Statement shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

(c) Insofar as indemnification for liabilities arising under the Securities Act may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Commission such indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Securities Act and will be governed by the final adjudication of such issue.

SIGNATURES

Pursuant to the requirements of the Securities Act, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements for filing on Form S-8 and has duly caused this Registration Statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of London, England on May 24, 2010.


REED ELSEVIER PLC Registrant		REED ELSEVIER NV Registrant

By:	/s/ Erik Engstrom	By:	/s/ Erik Engstrom
	Erik Engstrom		Erik Engstrom
	Chief Executive Officer		Member, Executive Board & Chief Executive Officer

POWER OF ATTORNEY

Know all persons by these presents, that each person whose signature appears below constitutes and appoints Stephen J. Cowden, Leslie Dixon, Jans van der Woude and Henry Z. Horbaczewski and each of them (with full power to each of them to act alone) his true and lawful attorney-in-fact and agent, with full power of substitution, and resubstitution, for him and in his name, place and stead, in any and all capacities, to execute one or more Registration Statements on Form S-8 relating to shares of The Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan, The Reed Elsevier Group plc Bonus Investment Plan 2010, The Reed Elsevier Group plc Growth Plan, and The Reed Elsevier Group plc Long-Term Incentive Plan 2010 to sign any and all amendments or supplements to such Registration Statement (including post-effective amendments) and to file the same with all exhibits thereto and other documents in connection therewith with the Securities and Exchange Commission, and does hereby grant unto said attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and thing requisite and necessary to be done in and about the premises as fully to all intents and purposes as he might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their substitutes, may lawfully do or cause to be done by virtue hereof.

This Power of Attorney has been signed below by the following persons in the capacities indicated as of the 24 ^th day of May, 2010.

Pursuant to the requirements of the Securities Act, this Registration Statement has been signed by the following persons in the capacities indicated below on May 24, 2010:

REED ELSEVIER PLC


SIGNATURE		TITLE

/s/ Erik Engstrom		Chief Executive Officer
Erik Engstrom		(Principal Executive Officer)

/s/ Mark Armour		Chief Financial Officer
Mark Armour		(Principal Financial and Accounting Officer)

/s/ Mark Elliott Mark Elliott		Director

/s/ Anthony Habgood Anthony Habgood		Chairman and Director

/s/ Lisa Hook Lisa Hook		Director

/s/ Robert Polet Robert Polet		Director

/s/ Andrew Prozes Andrew Prozes		Director

/s/ David Reid David Reid		Director

/s/ Lord Sharman of Redlynch		Director
Lord Sharman of Redlynch


SIGNATURE		TITLE

/s/ Ben van der Veer Ben van der Veer		Director

/s/ Henry Z. Horbaczewski		Authorized U.S. Representative
Henry Z. Horbaczewski

Pursuant to the requirements of the Securities Act, this Registration Statement has been signed by the following persons in the capacities indicated below on May 24, 2010:

REED ELSEVIER NV


SIGNATURE		TITLE

/s/ Erik Engstrom		Chief Executive Officer
Erik Engstrom		(Principal Executive Officer)

/s/ Mark Armour Mark Armour		Chief Financial Officer (Principal Financial and Accounting Officer)

/s/ Mark Elliott Mark Elliott		Member of the Supervisory Board

/s/ Anthony Habgood		Chairman of the Supervisory Board
Anthony Habgood

/s/ Lisa Hook		Member of the Supervisory Board
Lisa Hook

/s/ Marike van Lier Lels		Member of the Supervisory Board
Marike van Lier Lels

/s/ Robert Polet		Member of the Supervisory Board
Robert Polet

/s/ Andrew Prozes		Member of the Executive Board
Andrew Prozes

/s/ David Reid		Member of the Supervisory Board
David Reid

/s/ Lord Sharman of Redlynch		Member of the Supervisory Board
Lord Sharman of Redlynch


SIGNATURE		TITLE

/s/ Ben van der Veer		Member of the Supervisory Board
Ben van der Veer

/s/ Henry Z. Horbaczewski		Authorized U.S. Representative
Henry Z. Horbaczewski

Exhibit 4.1



THE COMPANIES ACT 2006		COMPANY NO. 77536

PUBLIC COMPANY LIMITED BY SHARES

ARTICLES OF ASSOCIATION

REED ELSEVIER PLC ¹ *

(Adopted by special resolution passed on 21 April 2010)

PRELIMINARY

Table A

The regulations in Table A in the schedule to the Companies (Tables A to F) Regulations 1985 as in force at the date of the incorporation of the Company shall not apply to the Company.

Definitions

2.		In these Articles, except where the subject or context otherwise requires:

		*Act* means the Companies Act 2006 including any modification or re-enactment of it for the time being in force;

		*Articles* means these articles of association as altered from time to time by special resolution;

		*auditors* means the auditors of the Company;


¹		NOTE: The Company was incorporated under the name of “ALBERT E. REED & COMPANY, LIMITED”. On 1st August, 1963, the name of the Company was changed to “REED PAPER GROUP LIMITED” pursuant to a SPECIAL RESOLUTION dated 24th July, 1963. On 11th August, 1969, the name of the Company was changed from “REED PAPER GROUP LIMITED” to “REED GROUP LIMITED” pursuant to a SPECIAL RESOLUTION dated 30th July, 1969. On 3rd August, 1970, the name of the Company was changed from “REED INTERNATIONAL LIMITED pursuant to a SPECIAL RESOLUTION dated 29th July, 1970. On 1st April, 1982 the name of the Company was changed from “REED INTERNATIONAL LIMITED” to “REED INTERNATIONAL P.L.C.” pursuant to a Directors’ resolution dated 2nd March, 1982. On 19th April, 2002 the name of the company was changed from “REED INTERNATIONAL P.L.C. to “REED ELSEVIER PLC” pursuant to a special resolution dated 9 April 2002.

Page 1

		*the board* means the directors or any of them, acting as the board of directors of the Company;

		*certificated share* means a share in the capital of the Company that is not an uncertificated share and references in these Articles to a share being held in certificated form shall be construed accordingly;

		*clear days* in relation to the sending of a notice means the period excluding the day on which a notice is given or deemed to be given and the day for which it is given or on which it is to take effect;

		*director* means a director of the Company;

		*dividend* means dividend or bonus;

		*entitled by transmission* means, in relation to a share in the capital of the Company, entitled as a consequence of the death or bankruptcy of the holder or otherwise by operation of law;

		*holder* in relation to a share in the capital of the Company means the member whose name is entered in the register as the holder of that share;

		*member* means a member of the Company;

		*office* means the registered office of the Company;

		*Ordinary Share* means an ordinary share of 14 51/116p in the capital of the Company;

		*Operator* shall have the meaning given to it in the Regulations;

		*paid* means paid or credited as paid;

		*recognised person* means a recognised clearing house or a nominee of a recognised clearing house or of a recognised investment exchange, each of which terms has the meaning given to it by section 778 of the Act;

		*register* means either or both of the issuer register of members and the Operator register of members of the Company;

		*Regulations* means the Uncertificated Securities Regulations 2001 including any modification or re-enactment of them for the time being in force;

		*seal* means the common seal of the Company and includes any official seal kept by the Company by virtue of section 49 or 50 of the Act;

		*secretary* means the secretary of the Company and includes a joint, assistant, deputy or temporary secretary and any other person appointed to perform the duties of the secretary;

Page 2

		*uncertificated share* means (subject to Regulation 42(11)(a) of the Regulations) a share in the capital of the Company title to which is recorded on the Operator register of members of the Company and which may, by virtue of the Regulations, be transferred by means of a relevant system and references in these Articles to a share being held in uncertificated form shall be construed accordingly; and

		*United Kingdom* means Great Britain and Northern Ireland.

Construction

3.		References to *writing* mean the representation or reproduction of words, symbols or other information in a visible form by any method or combination of methods, whether in electronic form or otherwise, and *written* shall be construed accordingly.

		References to a document or information being *sent, supplied or given* to or by a person mean such document or information, or a copy of such document or information, being sent, supplied, given, delivered, issued or made available to or by, or served on or by, or deposited with or by that person by any method authorised by these Articles, and *sending, supplying* and *giving* shall be construed accordingly.

		Where, in relation to a share, these Articles refer to a *relevant system* , the reference is to the relevant system in which that share is a participating security at the relevant time.

		Words denoting the singular number include the plural number and vice versa; words denoting the masculine gender include the feminine gender; and words denoting persons include corporations.

		Words or expressions contained in these Articles which are not defined in Article 2 but are defined in the Act have the same meaning as in the Act (but excluding any modification of the Act not in force at the date of adoption of these Articles) unless inconsistent with the subject or context.

		Words or expressions contained in these Articles which are not defined in Article 2 but are defined in the Regulations have the same meaning as in the Regulations (but excluding any modification of the Regulations not in force at the date of adoption of these Articles) unless inconsistent with the subject or context.

		Subject to the preceding two paragraphs, references to any provision of any enactment or of any subordinate legislation (as defined by section 21(1) of the Interpretation Act 1978) include any modification or re-enactment of that provision for the time being in force.

		Headings and marginal notes are inserted for convenience only and do not affect the construction of these Articles.

		In these Articles: (a) powers of delegation shall not be restrictively construed but the widest interpretation shall be given to them; (b) the word board in the context of the exercise of any power contained in these Articles includes any committee consisting of one or more directors, any director, any other officer of the Company and any local or divisional board, manager or agent of the Company to which or, as the case may

Page 3

be, to whom the power in question has been delegated; (c) no power of delegation shall be limited by the existence or, except where expressly provided by the terms of delegation, the exercise of that or any other power of delegation; and (d) except where expressly provided by the terms of delegation, the delegation of a power shall not exclude the concurrent exercise of that power by any other body or person who is for the time being authorised to exercise it under these Articles or under another delegation of the power.

SHARE CAPITAL AND LIMITED LIABILITY

Limited liability

The liability of the members is limited to the amount, if any, unpaid on the shares held by them.

Shares with special rights

Subject to the provisions of the Companies Acts and without prejudice to any rights attached to any existing shares or class of shares, any share may be issued with such rights or restrictions as the Company may by ordinary resolution determine or, subject to and in default of such determination, as the board shall determine.

Uncertificated shares

Subject to the provisions of the Regulations, the board may permit the holding of shares in any class of shares in uncertificated form and the transfer of title to shares in that class by means of a relevant system and may determine that any class of shares shall cease to be a participating security.

Not separate class of shares

Shares in the capital of the Company that fall within a certain class shall not form a separate class of shares from other shares in that class because any share in that class:

(a)		is held in uncertificated form; or

(b)		is permitted in accordance with the Regulations to become a participating security.

Exercise of Company’s entitlements in respect of uncertificated share

Where any class of shares is a participating security and the Company is entitled under any provision of the Companies Acts, the Regulations or these Articles to sell, transfer or otherwise dispose of, forfeit, redeem, re-allot, accept the surrender of or otherwise enforce a lien over a share held in uncertificated form, the Company shall be entitled, subject to the provisions of the Companies Acts, the Regulations, these Articles and the facilities and requirements of the relevant system:

(a)		to require the holder of that uncertificated share by notice to change that share into certificated form within the period specified in the notice and to hold that share in certificated form for so long as required by the Company;

(b)		to require the holder of that uncertificated share by notice to give any instructions necessary to transfer title to that share by means of the relevant system within the period specified in the notice;

(c)		to require the holder of that uncertificated share by notice to appoint any person to take any step including, without limitation, the giving of any

Page 4

instructions by means of the relevant system, necessary to transfer that share within the period specified in the notice;

(d)		to require the Operator to convert that uncertificated share into certificated form in accordance with Regulation 32(2)(c) of the Regulations; and

(e)		to take any action that the board considers appropriate to achieve the sale, transfer, disposal, forfeiture, re-allotment or surrender of that share or otherwise to enforce a lien in respect of that share.

Allotment

Subject to the provisions of the Companies Acts relating to authority, pre-emption rights or otherwise and of any resolution of the Company in general meeting passed pursuant thereto, and, in the case of redeemable shares, the provisions of Article 10, all shares for the time being in the capital of the Company shall be at the disposal of the board, and the board may reclassify, allot (with or without conferring a right of renunciation), grant options over, or otherwise dispose of them to such persons, on such terms and conditions, and at such times as it thinks fit.

Redeemable shares

10.

Subject to the provisions of the Companies Acts, and without prejudice to any rights attached to any existing shares or class of shares, shares may be issued which are to be redeemed or are to be liable to be redeemed at the option of the Company or the holder. The board may determine the terms, conditions and manner of redemption of shares provided that it does so before the shares are allotted.

Section 551 authority

11.

The board has general and unconditional authority to exercise all the powers of the Company to allot shares in the Company or to grant rights to subscribe for or to convert any security into shares in the Company up to an aggregate nominal amount equal to the section 551 amount, for each prescribed period.

Section 561 disapplication

12.		The board is empowered for each prescribed period to allot equity securities for cash pursuant to the authority conferred by Article 11 as if section 561 of the Act did not apply to any such allotment, provided that its power shall be limited to:

(a)		the allotment of equity securities in connection with a pre-emptive issue; and

(b)		the allotment (otherwise than pursuant to Article 12(a)) of equity securities up to an aggregate nominal amount equal to the section 561 amount.

		This Article applies in relation to a sale of shares which is an allotment of equity securities by virtue of section 560(3) of the Act as if in this Article the words “pursuant to the authority conferred by Article 11” were omitted.

Allotment after expiry

13.

The Company may make an offer or agreement which would or might require shares to be allotted or rights to subscribe for or convert any security into shares to be granted, after an authority given pursuant to Article 11 or a power given pursuant to Article 12 has expired. The board may allot shares, or grant rights to subscribe for or convert any security into shares, in pursuance of that offer or agreement as if the authority or power pursuant to which that offer or agreement was made had not expired.

Page 5

Definitions

14.		In this Article and Articles 11, 12, and 13:

		*prescribed period* means any period for which the authority conferred by Article 11 is given by ordinary or special resolution stating the section 551 amount and/or the power conferred by Article 12 is given by special resolution stating the section 561 amount;

		*pre-emptive issue* means an offer of equity securities to ordinary shareholders or an invitation to ordinary shareholders to apply to subscribe for equity securities and, if in accordance with their rights the board so determines, holders of other equity securities of any class (whether by way of rights issue, open offer or otherwise) where the equity securities respectively attributable to the interests of ordinary shareholders or holders of other equity securities, if applicable are proportionate (as nearly as practicable) to the respective numbers of ordinary shares or other equity securities, as the case may be held by them, but subject to such exclusions or other arrangements as the board may deem necessary or expedient in relation to fractional entitlements or any legal, regulatory or practical problems under the laws or regulations of any territory or the requirements of any regulatory body or stock exchange;

		*section 551 amount* means, for any prescribed period, the amount stated as such in the relevant ordinary or special resolution; and

		*section 561 amount* means, for any prescribed period, the amount stated as such in the relevant special resolution.

Commissions

15.

The Company may exercise all powers of paying commissions or brokerage conferred or permitted by the Companies Acts. Subject to the provisions of the Companies Acts, any such commission or brokerage may be satisfied by the payment of cash or by the allotment of fully or partly paid shares or partly in one way and partly in the other.

Trusts not recognised

16.

Except as required by law, no person shall be recognised by the Company as holding any share on any trust and (except as otherwise provided by these Articles or by law) the Company shall not be bound by or recognise any interest in any share (or in any fractional part of a share) except the holder’s absolute right to the entirety of the share (or fractional part of the share).

VARIATION OF RIGHTS

Method of varying rights

17.		Subject to the provisions of the Companies Acts, if at any time the capital of the Company is divided into different classes of shares, the rights attached to any class may (unless otherwise provided by the terms of allotment of the shares of that class) be varied or abrogated, whether or not the Company is being wound up, either:

(a)		with the written consent of the holders of three-quarters in nominal value of the issued shares of the class (excluding any shares of that class held as treasury shares), which consent shall be in hard copy form or in electronic form sent to such address (if any) for the time being specified by or on behalf of the Company for that purpose, or in default of such specification to the office, and may consist of several documents, each executed or authenticated

Page 6

in such manner as the board may approve by or on behalf of one or more holders, or a combination of both; or

(b)		with the sanction of a special resolution passed at a separate general meeting of the holders of the shares of the class,

but not otherwise.

When rights deemed to be varied

18.		For the purposes of Article 17, if at any time the capital of the Company is divided into different classes of shares, unless otherwise expressly provided by the rights attached to any share or class of shares, those rights shall be deemed to be varied by:

(a)		the reduction of the capital paid up on that share or class of shares otherwise than by a purchase or redemption by the Company of its own shares; and

(b)		the allotment of another share ranking in priority for payment of a dividend or in respect of capital or which confers on its holder voting rights more favourable than those conferred by that share or class of shares,

but shall not be deemed to be varied by:

(c)		the creation or issue of another share ranking equally with, or subsequent to, that share or class of shares or by the purchase or redemption by the Company of its own shares; or

(d)		the Company permitting, in accordance with the Regulations, the holding of and transfer of title to shares of that or any other class in uncertificated form by means of a relevant system.

SHARE CERTIFICATES

Members’ rights to certificates

19.

Every member, on becoming the holder of any certificated share (except a recognised person in respect of whom the Company is not required by law to complete and have ready for delivery a certificate) shall be entitled, without payment, to one certificate for all the certificated shares of each class held by him (and, on transferring a part of his holding of certificated shares of any class, to a certificate for the balance of his holding of certificated shares) or several certificates each for one or more of his certificated shares upon payment for every certificate after the first of such reasonable sum as the board may from time to time determine. Every certificate shall be executed under the seal or otherwise in accordance with Article 174 or in such other manner as the board may approve and shall specify the number, class and distinguishing numbers (if any) of the shares to which it relates and the amount or respective amounts paid up on those shares. The Company shall not be bound to issue more than one certificate for certificated shares held jointly by more than one person and delivery of a certificate to one joint holder shall be a sufficient delivery to all of them. Shares of different classes may not be included in the same certificate.

Renewed certificates

20.

If a share certificate is defaced, worn out, lost or destroyed, it may be renewed on such terms (if any) as to evidence and indemnity and payment of any exceptional

Page 7

out-of-pocket expenses reasonably incurred by the Company in investigating evidence and preparing the requisite form of indemnity as the board may determine but otherwise free of charge, and (in the case of defacement or wearing out) on delivery up of the old certificate.

LIEN

Company to have lien on shares

21.

The Company shall have a first and paramount lien on every share (not being a fully paid share) for all moneys payable to the Company (whether presently or not) in respect of that share. The board may at any time (generally or in a particular case) waive any lien or declare any share to be wholly or in part exempt from the provisions of this Article. The Company’s lien on a share shall extend to any amount including, without limitation, any dividend payable in respect of it.

Enforcement of lien by sale

22.

The Company may sell, in such manner as the board determines, any share on which the Company has a lien if a sum in respect of which the lien exists is presently payable and is not paid within fourteen clear days after notice has been sent to the holder of the share or to the person entitled to it by transmission, demanding payment and stating that if the notice is not complied with the share may be sold.

Giving effect to sale

23.

To give effect to any sale mentioned in Article 22 the board may, if the share is a certificated share, authorise any person to execute an instrument of transfer of the share sold to, or in accordance with the directions of, the purchaser. If the share is an uncertificated share, the board may exercise any of the Company’s powers under Article 8 to effect the sale of the share to, or in accordance with the directions of, the purchaser. The purchaser shall not be bound to see to the application of the purchase money nor shall his title to the share be affected by any irregularity in or invalidity of the proceedings in relation to the sale.

Application of proceeds

24.

The net proceeds of the sale mentioned in the preceding Articles, after payment of the costs, shall be applied in or towards payment or satisfaction of so much of the sum in respect of which the lien exists as is presently payable. Any residue shall (if the share sold is a certificated share, on surrender to the Company for cancellation of the certificate in respect of the share sold, and whether the share sold is a certificated or uncertificated share, subject to a like lien for any moneys not presently payable as existed on the share before the sale), be paid to the person entitled to the share at the date of the sale.

CALLS ON SHARES

Power to make calls

25.

Subject to the terms of allotment, the board may from time to time make calls on the members in respect of any moneys unpaid on their shares (whether in respect of nominal value or premium). Each member shall (subject to receiving at least 14 clear days’ notice specifying when and where payment is to be made) pay to the Company the amount called on his shares as required by the notice. A call may be required to be paid by instalments. A call may be revoked in whole or part and the time fixed for payment of a call may be postponed in whole or part as the board may determine. A person on whom a call is made shall remain liable for calls made on him notwithstanding any subsequent transfer of the shares in respect of which the call was made.

Page 8

Time when call made

26.

A call shall be deemed to have been made at the time when the resolution of the board authorising the call was passed.

Liability of joint holders

27.

The joint holders of a share shall be jointly and severally liable to pay all calls in respect of it.

Interest payable

28.

If a call or any instalment of a call remains unpaid in whole or in part after it has become due and payable the person from whom it is due and payable shall pay interest on the amount unpaid from the day it became due and payable until it is paid. The interest shall be paid at the rate fixed by the terms of allotment of the relevant share or in the notice of the call or, if no rate is fixed, at such rate, not exceeding 15 per cent. per annum or, if higher, the appropriate rate (as defined in the Act), as may be determined by the board. The board shall be at liberty to waive payment of such interest wholly or in part in respect of any individual member.

Deemed calls on allotment

29.

An amount payable in respect of a share on allotment or at any fixed date, whether in respect of nominal value or premium or as an instalment of a call, shall be deemed to be a call duly made and notified and payable on the date so fixed or in accordance with the terms of the allotment. If it is not paid the provisions of these Articles shall apply as if that amount had become due and payable by virtue of a call duly made and notified.

Differentiation on calls

30.

Subject to the terms of allotment, the board may make arrangements on the issue of shares for a difference between the allottees or holders in the amounts and times of payment of calls on their shares.

Payment of calls in advance

31.

The board may, if it thinks fit, receive from any member all or any part of the moneys uncalled and unpaid on any share held by him. Such payment in advance of calls shall extinguish the liability on the share in respect of which it is made to the extent of the payment. The Company may pay on all or any of the moneys so advanced (until they would but for such advance become presently payable) interest at such rate as may be agreed between the board and the member not exceeding (unless the Company by ordinary resolution otherwise directs) 15 per cent. per annum or, if higher, the appropriate rate (as defined in the Act).

FORFEITURE AND SURRENDER

Notice requiring payment of call

32.

If a call or any instalment of a call remains unpaid in whole or in part after it has become due and payable, the board may give the person from whom it is due not less than fourteen clear days’ notice requiring payment of the amount unpaid together with any interest which may have accrued and any costs, charges and expenses incurred by the Company by reason of such non-payment. The notice shall name the place where payment is to be made and shall state that if the notice is not complied with the shares in respect of which the call was made will be liable to be forfeited.

Forfeiture for non-compliance

33.

If any notice issued in accordance with Article 32 is not complied with, any share in respect of which it was sent may, at any time before the payment required by the notice has been made, be forfeited by a resolution of the board. The forfeiture shall include all dividends or other moneys payable in respect of the forfeited share which have not been paid before the forfeiture. When any share has been forfeited,

Page 9

notice of the forfeiture shall be sent to the person who was the holder of the share before the forfeiture. Where the forfeited share is held in certificated form, an entry shall be made promptly in the register opposite the entry of the share showing that notice has been sent, that the share has been forfeited and the date of forfeiture. No forfeiture shall be invalidated by any omission or neglect to send such notice or to make such entries.

Sale of forfeited shares

34.

Subject to the provisions of the Companies Acts, a forfeited share shall be deemed to belong to the Company and may be sold, re-allotted or otherwise disposed of on such terms and in such manner as the board determines, either to the person who was the holder before the forfeiture or to any other person. At any time before sale, re-allotment or other disposal, the forfeiture may be cancelled on such terms as the board thinks fit. Where for the purposes of its disposal a forfeited share held in certificated form is to be transferred to any person, the board may authorise any person to execute an instrument of transfer of the share to that person. Where for the purposes of its disposal a forfeited share held in uncertificated form is to be transferred to any person, the board may exercise any of the Company’s powers under Article 8. The Company may receive the consideration given for the share on its disposal and may register the transferee as holder of the share.

Liability following forfeiture

35.

A person shall cease to be a member in respect of any share which has been forfeited and shall, if the share is a certificated share, surrender the certificate for any forfeited share to the Company for cancellation. The person shall remain liable to the Company for all moneys which at the date of forfeiture were presently payable by him to the Company in respect of that share with interest on that amount at the rate at which interest was payable on those moneys before the forfeiture or, if no interest was so payable, at the rate determined by the board, not exceeding 15 per cent. per annum or, if higher, the appropriate rate (as defined in the Act), from the date of forfeiture until payment. The board may waive payment wholly or in part or enforce payment without any allowance for the value of the share at the time of forfeiture or for any consideration received on its disposal.

Surrender

36.

The board may accept the surrender of any share which it is in a position to forfeit on such terms and conditions as may be agreed. Subject to those terms and conditions, a surrendered share shall be treated as if it had been forfeited.

Extinction of rights

37.

The forfeiture of a share shall involve the extinction at the time of forfeiture of all interest in and all claims and demands against the Company in respect of the share and all other rights and liabilities incidental to the share as between the person whose share is forfeited and the Company, except only those rights and liabilities expressly saved by these Articles, or as are given or imposed in the case of past members by the Companies Acts.

Evidence of forfeiture or surrender

38.

A statutory declaration by a director or the secretary that a share has been duly forfeited or surrendered on a specified date shall be conclusive evidence of the facts stated in it as against all persons claiming to be entitled to the share. The declaration shall (subject if necessary to the execution of an instrument of transfer or transfer by means of the relevant system, as the case may be) constitute a good title to the share. The person to whom the share is disposed of shall not be bound to see to the

Page 10

application of the purchase money, if any, nor shall his title to the share be affected by any irregularity in, or invalidity of, the proceedings in reference to the forfeiture, surrender, sale, re-allotment or disposal of the share.

TRANSFER OF SHARES

Form and execution of transfer of certificated shares

39.

Without prejudice to any power of the Company to register as shareholder a person to whom the right to any share has been transmitted by operation of law, the instrument of transfer of a certificated share may be in any usual form or in any other form which the board may approve. An instrument of transfer shall be signed by or on behalf of the transferor and, unless the share is fully paid, by or on behalf of the transferee. An instrument of transfer need not be under seal.

Transfers of partly paid certificated shares

40.

The board may, in its absolute discretion, refuse to register the transfer of a certificated share which is not fully paid, provided that the refusal does not prevent dealings in shares in the Company from taking place on an open and proper basis.

Invalid transfers of certificated shares

41.		The board may also refuse to register the transfer of a certificated share unless the instrument of transfer:

(a)		is lodged, duly stamped (if stampable), at the office or at such other place appointed by the board accompanied by the certificate for the share to which it relates and such other evidence as the board may reasonably require to show the right of the transferor to make the transfer;

(b)		is in respect of only one class of shares; and

(c)		is in favour of not more than four transferees.

Transfers by recognised persons

42.

In the case of a transfer of a certificated share by a recognised person, the lodging of a share certificate will only be necessary if and to the extent that a certificate has been issued in respect of the share in question.

Notice of refusal to register

43.

If the board refuses to register a transfer of a share in certificated form, it shall send the transferee notice of its refusal within two months after the date on which the instrument of transfer was lodged with the Company.

No fee payable on registration

44.

No fee shall be charged for the registration of any instrument of transfer or other document relating to or affecting the title to a share.

Retention of transfers

45.

The Company shall be entitled to retain an instrument of transfer which is registered, but an instrument of transfer which the board refuses to register shall be returned to the person lodging it when notice of the refusal is sent.

TRANSMISSION OF SHARES

Transmission

46.

If a member dies, the survivor or survivors where he was a joint holder, and his personal representatives where he was a sole holder or the only survivor of joint holders, shall be the only persons recognised by the Company as having any title to

Page 11

his interest. Nothing in these Articles shall release the estate of a deceased member (whether a sole or joint holder) from any liability in respect of any share held by him.

Elections permitted

47.

A person becoming entitled to a share by transmission may, on production of such evidence as to his entitlement as the board may properly require, elect either to become the holder of the share or to have another person nominated by him registered as the transferee. If he elects to become the holder he shall send notice to the Company to that effect. If he elects to have another person registered and the share is a certificated share, he shall execute an instrument of transfer of the share to that person. If he elects to have himself or another person registered and the share is an uncertificated share, he shall take any action the board may require (including, without limitation, the execution of any document and the giving of any instruction by means of a relevant system) to enable himself or that person to be registered as the holder of the share. All the provisions of these Articles relating to the transfer of shares shall apply to any such notice or instrument of transfer as if it were an instrument of transfer executed by the member and the death or bankruptcy of the member or other event giving rise to the transmission had not occurred.

Elections required

48.

The board may at any time send a notice requiring any such person to elect either to be registered himself or to transfer the share. If the notice is not complied with within sixty days, the board may thereafter withhold payment of all dividends or other moneys payable in respect of the share until the requirements of the notice have been complied with.

Rights of persons entitled by transmission

49.

A person becoming entitled by transmission to a share shall, on production of any evidence as to his entitlement properly required by the board and subject to the requirements of Article 47, have the same rights in relation to the share as he would have had if he were the holder of the share, subject to Article 186. That person may give a discharge for all dividends and other moneys payable in respect of the share, but he shall not, before being registered as the holder of the share, be entitled in respect of it to receive notice of, or to attend or vote at, any meeting of the Company or to receive notice of, or to attend or vote at, any separate meeting of the holders of any class of shares in the capital of the Company.

ALTERATION OF SHARE CAPITAL

New shares subject to these Articles

50.		All shares created by increase of the Company’s share capital, by consolidation, division or sub-division of its share capital or the conversion of stock into paid-up shares shall be:

(a)		subject to all the provisions of these Articles including, without limitation, provisions relating to payment of calls, lien, forfeiture, transfer and transmission; and

(b)		unclassified, unless otherwise provided by these Articles, by the resolution creating the shares or by the terms of allotment of the shares.

Fractions arising

51.

Whenever any fractions arise as a result of a consolidation or sub-division of shares, the board may on behalf of the members deal with the fractions as it thinks fit. In particular, without limitation, the board may sell shares representing fractions to

Page 12

which any members would otherwise become entitled to any person (including, subject to the provisions of the Companies Acts, the Company) and distribute the net proceeds of sale in due proportion among those members or determine that the net proceeds of sale be retained for the benefit of the Company. Where the shares to be sold are held in certificated form, the board may authorise any person to execute an instrument of transfer of the shares to, or in accordance with the directions of, the purchaser. Where the shares to be sold are held in uncertificated form, the board may do all acts and things it considers necessary or expedient to effect the transfer of the shares to, or in accordance with the directions of, the purchaser. The purchaser shall not be bound to see to the application of the purchase moneys and his title to the shares shall not be affected by any irregularity in, or invalidity of, the proceedings in relation to the sale.

GENERAL MEETINGS

Annual general meetings

52.

The board shall convene and the Company shall hold a general meeting as its annual general meeting in accordance with the requirements of the Companies Acts.

Class meetings

53.		All provisions of these Articles relating to general meetings of the Company shall, mutatis mutandis, apply to every separate general meeting of the holders of any class of shares in the capital of the Company, except that:

(a)		the necessary quorum shall be two persons holding or representing by proxy at least one-third in nominal value of the issued shares of the class (excluding any shares of that class held as treasury shares) or, at any adjourned meeting of such holders, one holder present in person or by proxy, whatever the amount of his holding, who shall be deemed to constitute a meeting;

(b)		any holder of shares of the class present in person or by proxy may demand a poll; and

(c)		each holder of shares of the class shall, on a poll, have one vote in respect of every share of the class held by him.

		For the purposes of this Article, where a person is present by proxy or proxies, he is treated only as holding the shares in respect of which those proxies are authorised to exercise voting rights.

Convening general meetings

54.

The board may call general meetings whenever and at such times and places as it shall determine. On the requisition of members pursuant to the provisions of the Companies Acts, the board shall promptly convene a general meeting in accordance with the requirements of the Companies Acts. If there are insufficient directors in the United Kingdom to call a general meeting any director of the Company may call a general meeting, but where no director is willing or able to do so, any two members of the Company may summon a meeting for the purpose of appointing one or more directors.

Page 13

NOTICE OF GENERAL MEETINGS

Period of notice

55.

An annual general meeting shall be called by at least 21 clear days’ notice. Subject to the provisions of the Companies Acts, all other general meetings may be called by at least 14 clear days’ notice.

Recipients of notice

56.

Subject to the provisions of the Companies Acts, to the provisions of these Articles and to any restrictions imposed on any shares, the notice shall be sent to every member and every director. The auditors are entitled to receive all notices of , and other communications relating to, any general meeting which any member is entitled to receive.

Uncontactable shareholders

57.

Subject to the provisions of the Act, if on two consecutive occasions notices or any other documents have been sent by post to a member at his registered address but have been returned undelivered, then the member shall not be entitled to receive any subsequent notice or other documents until he has given to the Company a new registered address or has notified the Company in writing that such notices or other documents should continue to be sent to his registered address. For the purposes of this Article references to registered address mean, in the case of a member whose registered address is not within an EEA State, any address within an EEA State given by him to the Company for the service of notices or other documents. References to other documents do not include references to dividend warrants or cheques, which the Company shall be entitled to cease sending in accordance with the provisions of Article 192.

Contents of notice: general

58.

Subject to the provisions of the Companies Acts, the notice shall specify the time, date and place of the meeting (including, without limitation, any satellite meeting place arranged for the purposes of Article 61, which shall be identified as such in the notice) and the general nature of the business to be dealt with.

Contents of notice: additional requirements

59.

In the case of an annual general meeting, the notice shall specify the meeting as such. In the case of a meeting to pass a special resolution, the notice shall specify the intention to propose the resolution as a special resolution.

Article 63 arrangements

60.

The notice shall include details of any arrangements made for the purpose of Article 63 (making clear that participation in those arrangements will not amount to attendance at the meeting to which the notice relates).

General meetings at more than one place

61.		The board may resolve to enable persons entitled to attend a general meeting to do so by simultaneous attendance and participation at a satellite meeting place anywhere in the world. The members present in person or by proxy at satellite meeting places shall be counted in the quorum for, and entitled to vote at, the general meeting in question, and that meeting shall be duly constituted and its proceedings valid if the chairman of the general meeting is satisfied that adequate facilities are available throughout the general meeting to ensure that members attending at all the meeting places are able to:

(a)		participate in the business for which the meeting has been convened;

Page 14

(b)		hear and see all persons who speak (whether by the use of microphones, loudspeakers, audio-visual communications equipment or otherwise) in the principal meeting place and any satellite meeting place; and

(c)		be heard and seen by all other persons so present in the same way.

		The chairman of the general meeting shall be present at, and the meeting shall be deemed to take place at, the principal meeting place.

Interruption or adjournment where facilities inadequate

62.

If it appears to the chairman of the general meeting that the facilities at the principal meeting place or any satellite meeting place have become inadequate for the purposes referred to in Article 61, then the chairman may, without the consent of the meeting, interrupt or adjourn the general meeting. All business conducted at that general meeting up to the time of that adjournment shall be valid. The provisions of Article 74 shall apply to that adjournment.

Other arrangements for viewing and hearing proceedings

63.

The board may make arrangements for persons entitled to attend a general meeting or an adjourned general meeting to be able to view and hear the proceedings of the general meeting or adjourned general meeting; and to speak at the meeting (whether by the use of microphones, loudspeakers, audio-visual communications equipment or otherwise) by attending at a venue anywhere in the world not being a satellite meeting place. Those attending at any such venue shall not be regarded as present at the general meeting or adjourned general meeting and shall not be entitled to vote at the meeting at or from that venue. The inability for any reason of any member present in person or by proxy at such a venue to view or hear all or any of the proceedings of the meeting or to speak at the meeting shall not in any way affect the validity of the proceedings of the meeting.

Controlling level of attendance

64.

The board may from time to time make any arrangements for controlling the level of attendance at any venue for which arrangements have been made pursuant to Article 63 (including, without limitation, the issue of tickets or the imposition of some other means of selection) it in its absolute discretion considers appropriate, and may from time to time change those arrangements. If a member, pursuant to those arrangements, is not entitled to attend in person or by proxy at a particular venue, he shall be entitled to attend in person or by proxy at any other venue for which arrangements have been made pursuant to Article 63. The entitlement of any member to be present at such venue in person or by proxy shall be subject to any such arrangement then in force and stated by the notice of meeting or adjourned meeting to apply to the meeting.

Change in place and/or time of meeting

65.

If, after the sending of notice of a general meeting but before the meeting is held, or after the adjournment of a general meeting but before the adjourned meeting is held (whether or not notice of the adjourned meeting is required), the board decides that it is impracticable or unreasonable, for a reason beyond its control, to hold the meeting at the declared place (or any of the declared places, in the case of a meeting to which Article 61 applies) and/or time, it may change the place (or any of the places, in the case of a meeting to which Article 61 applies) and/or postpone the time at which the meeting is to be held. If such a decision is made, the board may then change the place (or any of the places, in the case of a meeting to which Article 61 applies)

Page 15

and/or postpone the time again if it decides that it is reasonable to do so. In either case:

	(a)		no new notice of the meeting need be sent, but the board shall, if practicable, advertise the date, time and place of the meeting in at least two newspapers having a national circulation and shall make arrangements for notices of the change of place and/or postponement to appear at the original place and/or at the original time; and

	(b)		a proxy appointment in relation to the meeting may, if by means of a document in hard copy form, be delivered to the office or to such other place within the United Kingdom as may be specified by or on behalf of the Company in accordance with Article 101(a) or, if in electronic form, be received at the address (if any) specified by or on behalf of the Company in accordance with Article 101(b), at any time not less than 48 hours before the postponed time appointed for holding the meeting provided that the board may specify, in any case, that in calculating the period of 48 hours, no account shall be taken of any part of a day that is not a working day.

Meaning of participate

66.

For the purposes of Articles 61 to 65, the right of a member to participate in the business of any general meeting shall include without limitation the right to speak, vote on a show of hands, vote on a poll, be represented by a proxy and have access to all documents which are required by the Companies Acts or these Articles to be made available at the meeting.

Accidental omission to send notice etc.

67.

The accidental omission to send a notice of a meeting or resolution, or to send any notification where required by the Companies Acts or these Articles in relation to the publication of a notice of meeting on a website, or to send a form of proxy where required by the Companies Acts or these Articles, to any person entitled to receive it, or the non-receipt for any reason of any such notice, resolution or notification or form of proxy by that person, whether or not the Company is aware of such omission or non-receipt, shall not invalidate the proceedings at that meeting.

Security

68.

The board and, at any general meeting, the chairman may make any arrangement and impose any requirement or restriction it or he considers appropriate to ensure the security of a general meeting including, without limitation, requirements for evidence of identity to be produced by those attending the meeting, the searching of their personal property and the restriction of items that may be taken into the meeting place. The board and, at any general meeting, the chairman are entitled to refuse entry to a person who refuses to comply with these arrangements, requirements or restrictions.

PROCEEDINGS AT GENERAL MEETINGS

Quorum

69.

No business shall be dealt with at any general meeting unless a quorum is present, but the absence of a quorum shall not preclude the choice or appointment of a chairman, which shall not be treated as part of the business of the meeting. Save as otherwise provided by these Articles, two qualifying persons present at a meeting and entitled to vote on the business to be dealt with are a quorum, unless:

Page 16

	(a)		each is a qualifying person only because he is authorised under the Companies Acts to act as a representative of a corporation in relation to the meeting, and they are representatives of the same corporation; or

	(b)		each is a qualifying person only because he is appointed as proxy of a member in relation to the meeting, and they are proxies of the same member.

For the purposes of this Article a “qualifying person” means: (i) an individual who is a member of the Company; (ii) a person authorised under the Companies Acts to act as a representative of the corporation in relation to the meeting; or (iii) a person appointed as proxy of a member in relation to the meeting.

If quorum not present

70.

If such a quorum is not present within five minutes (or such longer time not exceeding thirty minutes as the chairman of the meeting may decide to wait) from the time appointed for the meeting, or if during a meeting such a quorum ceases to be present, the meeting, if convened on the requisition of members, shall be dissolved, and in any other case shall stand adjourned to such time and place as the chairman of the meeting may, subject to the provisions of the Companies Acts, determine. If at the adjourned meeting a quorum is not present within fifteen minutes after the time appointed for holding the meeting, the meeting shall be dissolved.

Chairman

71.

The chairman, if any, of the board or, in his absence, any deputy chairman of the Company or, in his absence, some other director nominated by the board, shall preside as chairman of the meeting. If neither the chairman, deputy chairman nor such other director (if any) is present within five minutes after the time appointed for holding the meeting or is not willing to act as chairman, the directors present shall elect one of their number to be chairman. If there is only one director present and willing to act, he shall be chairman. If no director is willing to act as chairman, or if no director is present within five minutes after the time appointed for holding the meeting, the members present in person or by proxy and entitled to vote shall choose a member or a proxy of a member or a person authorised to act as a representative of a corporation in relation to the meeting to be chairman.

Directors entitled to speak

72.

A director shall, notwithstanding that he is not a member, be entitled to attend and speak at any general meeting and at any separate meeting of the holders of any class of shares in the capital of the Company.

Adjournment: chairman’s powers

73.

The chairman may, with the consent of a meeting at which a quorum is present (and shall if so directed by the meeting), adjourn the meeting from time to time and from place to place. No business shall be dealt with at an adjourned meeting other than business which might properly have been dealt with at the meeting had the adjournment not taken place. In addition (and without prejudice to chairman’s power to adjourn a meeting conferred by Article 62), the chairman may adjourn the meeting to another time and place without such consent if it appears to him that:

	(a)		it is likely to be impracticable to hold or continue that meeting because of the number of members wishing to attend who are not present; or

	(b)		the conduct of persons attending the meeting prevents or is likely to prevent the orderly continuation of the business of the meeting; or

Page 17

(c)

an adjournment is otherwise necessary so that the business of the meeting may be properly conducted.

Adjournment: procedures

74.

Any such adjournment may, subject to the provisions of the Companies Acts, be for such time and to such other place (or, in the case of a meeting held at a principal meeting place and a satellite meeting place, such other places) as the chairman may, in his absolute discretion determine, notwithstanding that by reason of such adjournment some members may be unable to be present at the adjourned meeting. Any such member may nevertheless appoint a proxy for the adjourned meeting either in accordance with Article 101 or by means of a document in hard copy form which, if delivered at the meeting which is adjourned to the chairman or the secretary or any director, shall be valid even though it is given at less notice than would otherwise be required by Article 101(a). When a meeting is adjourned for 30 days or more or for an indefinite period, notice shall be sent at least seven clear days before the date of the adjourned meeting specifying the time and place (or places, in the case of a meeting to which Article 61 applies) of the adjourned meeting and the general nature of the business to be transacted. Otherwise it shall not be necessary to send any notice of an adjournment or of the business to be dealt with at an adjourned meeting.

Amendments to resolutions

75.

If an amendment is proposed to any resolution under consideration but is in good faith ruled out of order by the chairman, the proceedings on the substantive resolution shall not be invalidated by any error in such ruling. With the consent of the chairman, an amendment may be withdrawn by its proposer before it is voted on. No amendment to a resolution duly proposed as a special resolution may be considered or voted on (other than a mere clerical amendment to correct a patent error). No amendment to a resolution duly proposed as an ordinary resolution may be considered or voted on (other than a mere clerical amendment to correct a patent error) unless either:

	(a)		at least 48 hours before the time appointed for holding the meeting or adjourned meeting at which the ordinary resolution is to be considered (which, if the board so specifies, shall be calculated taking no account of any part of a day that is not a working day), notice of the terms of the amendment and the intention to move it has been delivered in hard copy form to the office or to such other place as may be specified by or on behalf of the Company for that purpose, or received in electronic form at such address (if any) for the time being specified by or on behalf of the Company for that purpose, or

	(b)		the chairman in his absolute discretion decides that the amendment may be considered and voted on.

Methods of voting

76.

A resolution put to the vote of a general meeting shall be decided on a show of hands unless before, or on the declaration of the result of, a vote on the show of hands, or on the withdrawal of any other demand for a poll, a poll is duly demanded. Subject to the provisions of the Companies Acts, a poll may be demanded by:

(a)

the chairman of the meeting; or

Page 18

	(b)		(except on the election of the chairman of the meeting or on a question of adjournment) at least five members present in person or by proxy having the right to vote on the resolution; or

	(c)		any member or members present in person or by proxy representing not less than 10% of the total voting rights of all the members having the right to vote on the resolution (excluding any voting rights attached to any shares held as treasury shares); or

	(d)		any member or members present in person or by proxy holding shares conferring a right to vote on the resolution, being shares on which an aggregate sum has been paid up equal to not less than 10% of the total sum paid up on all the shares conferring that right (excluding any shares conferring a right to vote on the resolution which are held as treasury shares).

The appointment of a proxy to vote on a matter at a meeting authorises the proxy to demand, or join in demanding, a poll on that matter. In applying the provisions of this Article, a demand by a proxy counts: (i) for the purposes of paragraph (b) of this Article, as a demand by the member; (ii) for the purposes of paragraph (c) of this Article, as a demand by a member representing the voting rights that the proxy is authorised to exercise; and (iii) for the purposes of paragraph (d) of this Article, as a demand by a member holding the shares to which those rights are attached.

Declaration of result

77.

Unless a poll is duly demanded (and the demand is not withdrawn before the poll is taken) a declaration by the chairman that a resolution has been carried or carried unanimously, or by a particular majority, or lost, or not carried by a particular majority shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favour of or against the resolution.

Withdrawal of demand for poll

78.

The demand for a poll may be withdrawn before the poll is taken, but only with the consent of the chairman. A demand so withdrawn shall not be taken to have invalidated the result of a show of hands declared before the demand was made. If the demand for a poll is withdrawn, the chairman or any other member entitled may demand a poll.

Conduct of poll

79.

Subject to Article 80 a poll shall be taken as the chairman directs and he may, and shall if required by the meeting, appoint scrutineers (who need not be members) and fix a time and place for declaring the result of the poll. The result of the poll shall be deemed to be the resolution of the meeting at which the poll was demanded.

When poll to be taken

80.

A poll demanded on the election of a chairman or on a question of adjournment shall be taken immediately. A poll demanded on any other question shall be taken either at the meeting or at such time and place as the chairman directs not being more than thirty days after the poll is demanded. The demand for a poll shall not prevent the continuance of a meeting for the transaction of any business other than the question on which the poll was demanded. If a poll is demanded before the declaration of the result of a show of hands and the demand is duly withdrawn, the meeting shall continue as if the demand had not been made.

Page 19

Notice of poll

81.

No notice need be sent of a poll not taken at the meeting at which it is demanded if the time and place at which it is to be taken are announced at the meeting. In any other case at least seven clear days’ notice shall be sent before the taking of the poll specifying the time and place at which the poll is to be taken.

Effectiveness of special resolutions

82.

Where for any purpose an ordinary resolution of the Company is required, a special resolution shall also be effective.

VOTES OF MEMBERS

Right to vote on a show of hands

83.

Subject to any rights or restrictions attached to any shares, on a vote on a resolution on a show of hands:

	(a)		every member who is present in person shall have one vote;

	(b)		subject to paragraph (c) of this Article, every proxy present who has been duly appointed by one or more members entitled to vote on the resolution has one vote;

	(c)		a proxy has one vote for and one vote against the resolution if:

	(i)		the proxy has been duly appointed by more than one member entitled to vote on the resolution, and

	(ii)		the proxy has been instructed by one or more of those members to vote for the resolution and by one or more other of those members to vote against it.

Right to vote on a poll

84.

Subject to any rights or restrictions attached to any shares, on a vote on a resolution on a poll every member present in person or by proxy shall have one vote for every share of which he is the holder.

Votes of joint holders

85.

In the case of joint holders of a share, the vote of the senior who tenders a vote, whether in person or by proxy, shall be accepted to the exclusion of the votes of the other joint holders. For this purpose seniority shall be determined by the order in which the names of the holders stand in the register.

Member under incapacity

86.

A member in respect of whom an order has been made by a court or official having jurisdiction (whether in the United Kingdom or elsewhere) in matters concerning mental disorder may vote, whether on a show of hands or on a poll, by his receiver, curator bonis or other person authorised for that purpose appointed by that court or official. That receiver, curator bonis or other person may, on a show of hands or on a poll, vote by proxy. The right to vote shall be exercisable only if evidence satisfactory to the board of the authority of the person claiming to exercise the right to vote has been delivered to the office, or another place specified in accordance with these Articles for the delivery of proxy appointments, not less than 48 hours before the time appointed for holding the meeting or adjourned meeting at which the right to vote is to be exercised provided that the Company may specify, in any case, that in calculating the period of 48 hours, no account shall be taken of any part of a day that is not a working day.

Page 20

Calls in arrears

87.

No member shall be entitled to vote at any general meeting or at any separate meeting of the holders of any class of shares in the capital of the Company, either in person or by proxy, in respect of any share held by him unless all moneys presently payable by him in respect of that share have been paid

Section 793 of the Act: restrictions if in default

88.

If at any time the board is satisfied that any member, or any other person appearing to be interested in shares held by such member, has been duly served with a notice under section 793 of the Act (a section 793 notice ) and is in default for the prescribed period in supplying to the Company the information thereby required, or, in purported compliance with such a notice, has made a statement which is false or inadequate in a material particular, then the board may, in its absolute discretion at any time thereafter by notice (a direction notice ) to such member direct that:

	(a)		in respect of the shares in relation to which the default occurred (the *default shares* , which expression includes any shares issued after the date of the section 793 notice in respect of those shares) the member shall not be entitled to attend or vote either personally or by proxy at a general meeting or at a separate meeting of the holders of that class of shares or on a poll; and

	(b)		where the default shares represent at least ¹ / 4 of one per cent. in nominal value of the issued shares of their class (excluding any shares of that class held as treasury shares), the direction notice may additionally direct that in respect of the default shares:

	(i)		no payment shall be made by way of dividend and no share shall be allotted pursuant to Article 184;

	(ii)		no transfer of any default share shall be registered unless:

	(A)		the member is not himself in default as regards supplying the information requested and the transfer when presented for registration is accompanied by a certificate by the member in such form as the board may in its absolute discretion require to the effect that after due and careful enquiry the member is satisfied that no person in default as regards supplying such information is interested in any of the shares the subject of the transfer; or

	(B)		the transfer is an approved transfer; or

	(C)		registration of the transfer is required by the Regulations.

Copy of notice to interested persons

89.

The Company shall send the direction notice to each other person appearing to be interested in the default shares, but the failure or omission by the Company to do so shall not invalidate such notice.

When restrictions cease to have effect

90.

Any direction notice shall cease to have effect. not more than seven days after the earlier of receipt by the Company of:

Page 21

	(a)		a notice of an approved transfer, but only in relation to the shares transferred; or

	(b)		all the information required by the relevant section 793 notice, in a form satisfactory to the board.

Board may cancel restrictions

91.

The board may at any time send a notice cancelling a direction notice.

Conversion of uncertificated shares

92.

The Company may exercise any of its powers under Article 8 in respect of any default share that is held in uncertificated form.

Supplementary provisions

93.

For the purposes of this Article and Articles 88, 89, 90, 91 and 92:

	(a)		a person shall be treated as appearing to be interested in any shares if the member holding such shares has sent to the Company a notification under section 793 of the Act which either (i) names such person as being so interested or (ii) fails to establish the identities of all those interested in the shares, and (after taking into account the said notification and any other relevant section 793 notification) the Company knows or has reasonable cause to believe that the person in question is or may be interested in the shares;

	(b)		the prescribed period is 14 days from the date of service of the section 793 notice; and

	(c)		a transfer of shares is an approved transfer if:

	(i)		it is a transfer of shares pursuant to an acceptance of a takeover offer (within the meaning of section 974 of the Act); or

	(ii)		the board is satisfied that the transfer is made pursuant to a sale of the whole of the beneficial ownership of the shares the subject of the transfer to a party unconnected with the member and with any other person appearing to be interested in the shares; or

	(iii)		the transfer results from a sale made through a recognised investment exchange as defined in the Financial Services and Markets Act 2000 or any other stock exchange outside the United Kingdom on which the Company’s shares are normally traded.

Section 794 of the Act

94.

Nothing contained in Article 88, 89, 90, 91, 92 or 93 limits the power of the Company under section 794 of the Act.

Errors in voting

95.

If any votes are counted in any meeting which ought not to have been counted, or might have been rejected, the error shall not vitiate the result of the voting unless it is pointed out at the same meeting, or at any adjournment thereof, and it is in the opinion of the chairman of sufficient magnitude to vitiate the result of the voting.

Objection to voting

96.

No objection shall be raised to the qualification of any voter except at the meeting or adjourned meeting or poll at which the vote objected to is tendered. Every vote not disallowed at such meeting shall be valid and every vote not counted which

Page 22

ought to have been counted shall be disregarded. Any objection made in due time shall be referred to the chairman whose decision shall be final and conclusive.

Voting: additional provisions

97.

On a poll a member entitled to more than one vote need not, if he votes, use all his votes or cast all the votes he uses in the same way.

PROXIES AND CORPORATE REPRESENTATIVES

Appointment of proxy: form

98.

The appointment of a proxy shall be made in writing and shall be in any usual form or in any other form which the board may approve. Subject thereto, the appointment of a proxy may be:

	(a)		in hard copy form; or

	(b)		in electronic form, to the electronic address provided by the Company for this purpose.

Execution of proxy

99.

The appointment of a proxy, whether made in hard copy form or in electronic form, shall be executed in such manner as may be approved by or on behalf of the Company from time to time. Subject thereto, the appointment of a proxy shall be executed by the appointer or any person duly authorised by the appointer or, if the appointer is a corporation, executed by a duly authorised person or under its common seal or in any other manner authorised by its constitution.

Proxies: other provisions

100.

The board may, if it thinks fit, but subject to the provisions of the Companies Acts, at the Company’s expense send hard copy forms of proxy for use at the meeting and issue invitations in electronic form to appoint a proxy in relation to the meeting in such form as may be approved by the board. The appointment of a proxy shall not preclude a member from attending and voting in person at the meeting or poll concerned. A member may appoint more than one proxy to attend on the same occasion, provided that each such proxy is appointed to exercise the rights attached to a different share or shares held by that member.

Delivery/receipt of proxy appointment

101.

Without prejudice to Article 65(b) or to the second sentence of Article 74, the appointment of a proxy shall:

(a)

if in hard copy form, be delivered by hand or by post to the office or such other place within the United Kingdom as may be specified by or on behalf of the Company for that purpose:

	(i)		in the notice convening the meeting; or

	(ii)		in any form of proxy sent by or on behalf of the Company in relation to the meeting;

not less than 48 hours before the time appointed for holding the meeting or adjourned meeting (or any postponed time appointed for holding the meeting pursuant to Article 65) at which the person named in the appointment proposes to vote; or

Page 23

(b)

if in electronic form, be received at any address to which the appointment of a proxy may be sent by electronic means pursuant to a provision of the Companies Acts or to any other address specified by or on behalf of the Company for the purpose of receiving the appointment of a proxy in electronic form:

	(i)		in the notice convening the meeting; or

	(ii)		in any form of proxy sent by or on behalf of the Company in relation to the meeting; or

	(iii)		in any invitation to appoint a proxy issued by the Company in relation to the meeting; or

	(iv)		on a website that is maintained by or on behalf of the Company and identifies the Company,

			not less than 48 hours before the time appointed for holding the meeting or adjourned meeting (or any postponed time appointed for holding the meeting pursuant to Article 65) at which the person named in the appointment proposes to vote; or

	(c)		in either case, where a poll is taken more than 48 hours after it is demanded, be delivered or received as aforesaid after the poll has been demanded and not less than 24 hours before the time appointed for the taking of the poll; or

	(d)		if in hard copy form, where a poll is not taken forthwith but is taken not more than 48 hours after it was demanded, be delivered at the meeting at which the poll was demanded to the chairman or to the secretary or to any director.

In calculating the periods mentioned in this Article, the board may specify, in any case, that no account shall be taken of any part of a day that is not a working day.

Authentication of proxy appointment not made by holder

102.

Subject to the provisions of the Companies Acts, where the appointment of a proxy is expressed to have been or purports to have been made, sent or supplied by a person on behalf of the holder of a share:

	(a)		the Company may treat the appointment as sufficient evidence of the authority of that person to make, send or supply the appointment on behalf of that holder; and

	(b)		that holder shall, if requested by or on behalf of the Company at any time, send or procure the sending of any reasonable evidence of the authority under which the appointment has been made, sent or supplied (which may include a copy of such authority certified notarially or in some other way approved by the board), to such address and by such time as may be specified in the request and, if the request is not complied with in any respect, the appointment may be treated as invalid.

Page 24

Validity of proxy appointment

103.

A proxy appointment which is not delivered or received in accordance with Article 101 shall be invalid. When two or more valid proxy appointments are delivered or received in respect of the same share for use at the same meeting, the one that was last delivered or received shall be treated as replacing or revoking the others as regards that share, provided that if the Company determines that it has insufficient evidence to decide whether or not a proxy appointment is in respect of the same share, it shall be entitled to determine which proxy appointment (if any) is to be treated as valid. Subject to the Companies Acts, the Company may determine at its discretion when a proxy appointment shall be treated as delivered or received for the purposes of these Articles.

Rights of proxy

104.

A proxy appointment shall be deemed to entitle the proxy to exercise all or any of the appointing member’s rights to attend and to speak and vote at a meeting of the Company in respect of the shares to which the proxy appointment relates. The proxy appointment shall, unless it provides to the contrary, be valid for any adjournment of the meeting as well as for the meeting to which it relates.

Vote by proxy

105.

The Company shall not be required to check that a proxy or corporate representative votes in accordance with any instructions given by the member by whom he is appointed. Any failure to vote as instructed shall not invalidate the proceedings on the resolution.

Corporate representatives

106.

Any corporation which is a member of the Company (in this Article the grantor ) may, by resolution of its directors or other governing body, authorise such person or persons as it thinks fit to act as its representative or representatives at any meeting of the Company or at any separate meeting of the holders of any class of shares. A director, the secretary or other person authorised for the purpose by the secretary may require all or any of such persons to produce a certified copy of the resolution of authorisation before permitting him to exercise his powers. Such person is entitled to exercise the same powers on behalf of the grantor as the grantor could exercise if it were an individual member of the Company. Where the grantor authorises more than one person:

	(a)		on a vote on a resolution on a show of hands at a meeting of the Company, each authorised person has the same voting rights as the grantor would be entitled to; and

	(b)		where paragraph (a) of this Article does not apply and more than one authorised person purport to exercise a power in respect of the same shares:

	(i)		if they purport to exercise the power in the same way as each other, the power is treated as exercised in that way; and

	(ii)		if they do not purport to exercise the power in the same way as each other, the power is treated as not exercised.

Revocation of authority

107.

The termination of the authority of a person to act as a proxy or duly authorised representative of a corporation does not affect:

(a)

whether he counts in deciding whether there is a quorum at a meeting;

Page 25

	(b)		the validity of anything he does as chairman of a meeting;

	(c)		the validity of a poll demanded by him at a meeting; or

	(d)		the validity of a vote given by that person,

unless notice of the termination was either delivered or received as mentioned in the following sentence at least three hours before the start of the relevant meeting or adjourned meeting or (in the case of a poll taken otherwise than on the same day as the meeting or adjourned meeting) the time appointed for taking the poll. Such notice of termination shall be either by means of a document in hard copy form delivered to the office or to such other place within the United Kingdom as may be specified by or on behalf of the Company in accordance with Article 101(a) or in electronic form received at the address specified by or on behalf of the Company in accordance with Article 101(b), regardless of whether any relevant proxy appointment was effected in hard copy form or in electronic form.

NUMBER OF DIRECTORS

Limits on number of directors

108.

Unless otherwise determined by ordinary resolution, the number of directors (other than alternate directors) shall be not less than five nor more than twenty in number.

APPOINTMENT AND RETIREMENT OF DIRECTORS

Number of directors to retire

109.

At every annual general meeting one-third of the directors or, if their number is not three or a multiple of three, the number nearest to one-third shall retire from office, but:

	(a)		if any director has at the start of the annual general meeting been in office for three years or more since his last appointment or re-appointment, he shall retire at that annual general meeting; and

	(b)		if there is only one director who is subject to retirement by rotation, he shall retire at that annual general meeting.

Which directors to retire

110.

Subject to the provisions of the Companies Acts and these Articles, the directors to retire by rotation shall be, first, those who wish to retire and not be re-appointed to office and, second, those who have been longest in office since their last appointment or re-appointment. As between persons who became or were last re-appointed directors on the same day those to retire shall (unless they otherwise agree among themselves) be determined by lot. The directors to retire on each occasion (both as to number and identity) shall be determined by the composition of the board at the date of the notice convening the annual general meeting. No director shall be required to retire or be relieved from retiring or be retired by reason of any change in the number or identity of the directors after the date of the notice but before the close of the meeting.

Page 26

When director deemed to be re-appointed

111.

If the Company does not fill the vacancy, at the meeting at which a director retires by rotation or otherwise, the retiring director shall, if willing to act, be deemed to have been re-appointed unless at the meeting it is resolved not to fill the vacancy or unless a resolution for the re-appointment of the director is put to the meeting and lost.

Eligibility for election

112.

No person other than a director retiring by rotation shall be appointed a director at any general meeting unless:

	(a)		he is recommended by the board; or

	(b)		not less than ten nor more than 42 clear days before the date appointed for the meeting, notice executed by a member qualified to vote at the meeting (not being the person to be proposed) has been received by the Company of the intention to propose that person for appointment stating the particulars which would, if he were so appointed, be required to be included in the Company’s register of directors, together with notice by that person of his willingness to be appointed.

Separate resolutions on appointment

113.

Except as otherwise authorised by the Companies Acts, the appointment of any person proposed as a director shall be effected by a separate resolution.

Additional powers of the Company

114.

Subject as aforesaid, the Company may by ordinary resolution appoint a person who is willing to act to be a director either to fill a vacancy or as an additional director and may also determine the rotation in which any additional directors are to retire. The appointment of a person to fill a vacancy or as an additional director shall take effect from the end of the meeting.

Appointment by board

115.

The board may appoint a person who is willing to act to be a director, either to fill a vacancy or as an additional director and in either case whether or not for a fixed term, provided that the appointment does not cause the number of directors to exceed the number, if any, fixed by or in accordance with these Articles as the maximum number of directors. Irrespective of the terms of his appointment, a director so appointed shall hold office only until the next following annual general meeting and shall not be taken into account in determining the directors who are to retire by rotation at the meeting. If not re-appointed at such annual general meeting, he shall vacate office at its conclusion.

Position of retiring directors

116.

A director who retires at an annual general meeting may, if willing to act, be re-appointed. If he is not re-appointed, he shall retain office until the meeting appoints someone in his place, or if it does not do so, until the end of the meeting.

No share qualification

117.

A director shall not be required to hold any shares in the capital of the Company by way of qualification.

ALTERNATE DIRECTORS

Power to appoint alternates

118.

Any director (other than an alternate director) may appoint any other director, or any other person approved by resolution of the board and willing to act, to be an

Page 27

alternate director and may remove from office an alternate director so appointed by him.

Alternates entitled to receive notice

119.

An alternate director shall be entitled to receive notice of all meetings of the board and of all meetings of committees of the board of which his appointer is a member, to attend and vote at any such meeting at which his appointer is not personally present, and generally to perform all the functions of his appointer (except as regards power to appoint an alternate) as a director in his absence. It shall not be necessary to send notice of such a meeting to an alternate director who is absent from the United Kingdom.

Alternates representing more than one director

120.

A director or any other person may act as alternate director to represent more than one director, and an alternate director shall be entitled at meetings of the board or any committee of the board to one vote for every director whom he represents (and who is not present) in addition to his own vote (if any) as a director, but he shall count as only one for the purpose of determining whether a quorum is present.

Expenses and remuneration of alternates

121.

An alternate director may be repaid by the Company such expenses as might properly have been repaid to him if he had been a director but shall not in respect of his services as an alternate director be entitled to receive any remuneration from the Company except such part (if any) of the remuneration otherwise payable to his appointer as such appointer may by notice to the Company from time to time direct. An alternate director shall be entitled to be indemnified by the Company to the same extent as if he were a director.

Termination of appointment

122.

An alternate director shall cease to be an alternate director:

	(a)		if his appointer ceases to be a director; but, if a director retires by rotation or otherwise but is re-appointed or deemed to have been re-appointed at the meeting at which he retires, any appointment of an alternate director made by him which was in force immediately prior to his retirement shall continue after his re-appointment; or

	(b)		on the happening of any event which, if he were a director, would cause him to vacate his office as director; or

	(c)		if he resigns his office by notice to the Company.

Method of appointment and revocation

123.

Any appointment or removal of an alternate director shall be by notice to the Company by the director making or revoking the appointment and shall take effect in accordance with the terms of the notice (subject to any approval required by Article 118) on receipt of such notice by the Company which shall be in hard copy form or in electronic form sent to such address (if any) for the time being specified by or on behalf of the Company for that purpose.

Alternate not an agent of appointer

124.

Save as otherwise expressly provided in these Articles, an alternate director shall be deemed for all purposes to be a director and accordingly, except where the context otherwise requires, a reference to a director shall be deemed to include a reference to an alternate director. An alternate director shall alone be responsible for

Page 28

his own acts and defaults and he shall not be deemed to be the agent of the director appointing him.

POWERS OF THE BOARD

Business to be managed by board

125.

Subject to the provisions of the Companies Acts and these Articles and to any directions given by special resolution, the business of the Company shall be managed by the board which may exercise all the powers of the Company including, without limitation, the power to dispose of all or any part of the undertaking of the Company. No alteration of the Articles and no such direction shall invalidate any prior act of the board which would have been valid if that alteration had not been made or that direction had not been given. The powers given by this Article shall not be limited by any special power given to the board by these Articles. A meeting of the board at which a quorum is present may exercise all powers exercisable by the board.

Exercise by Company of voting rights

126.

The board may exercise the voting power conferred by the shares in any body corporate held or owned by the Company in such manner in all respects as it thinks fit (including, without limitation, the exercise thereof in favour of any resolution appointing its members or any of them directors of such body corporate, or voting or providing for the payment of remuneration to the directors of such body corporate).

DELEGATION OF POWERS OF THE BOARD

Committees of the board

127.		The board may delegate any of its powers to any committee consisting of one or more directors. The board may also delegate to any director holding any executive office such of its powers as the board considers desirable to be exercised by him. Any such delegation shall, in the absence of express provision to the contrary in the terms of delegation, be deemed to include authority to sub-delegate to one or more directors (whether or not acting as a committee) or to any employee or agent of the Company all or any of the powers delegated and may be made subject to such conditions as the board may specify, and may be revoked or altered. The board may co-opt on to any such committee persons other than directors, who may enjoy voting rights in the committee. The number of co-opted members shall be not more than one-half of the total membership of the committee.

		Subject to any conditions imposed by the board, the proceedings of a committee with two or more members shall be governed by these Articles regulating the proceedings of directors so far as they are capable of applying.

Local boards, etc.

128.

The board may establish local or divisional boards or agencies for managing any of the affairs of the Company, either in the United Kingdom or elsewhere, and may appoint any persons to be members of the local or divisional boards, or any managers or agents, and may fix their remuneration. The board may delegate to any local or divisional board, manager or agent any of the powers, authorities and discretions vested in or exercisable by the board, with power to sub-delegate, and may authorise the members of any local or divisional board, or any of them, to fill any vacancies and to act notwithstanding vacancies. Any appointment or delegation made pursuant to this Article may be made on such terms and subject to such conditions as the board may decide. The board may remove any person so appointed and may

Page 29

revoke or vary the delegation but no person dealing in good faith and without notice of the revocation or variation shall be affected by it.

Agents

129.

The board may, by power of attorney or otherwise, appoint any person to be the agent of the Company for such purposes, with such powers, authorities and discretions (not exceeding those vested in the board) and on such conditions as the board determines, including, without limitation, authority for the agent to delegate all or any of his powers, authorities and discretions, and may revoke or vary such delegation.

Offices including title

130.

The board may appoint any person to any office or employment having a designation or title including the word “director” or attach to any existing office or employment with the Company such a designation or title and may terminate any such appointment or the use of any such designation or title. The inclusion of the word “director” in the designation or title of any such office or employment shall not imply that the holder is a director of the Company, and the holder shall not thereby be empowered in any respect to act as, or be deemed to be, a director of the Company for any of the purposes of these Articles.

BORROWING POWERS

Power to borrow

131.

The board may exercise all the powers of the Company to borrow money, to guarantee, to indemnify, to mortgage or charge its undertaking, property, assets (present and future) and uncalled capital, and to issue debentures and other securities whether outright or as collateral security for any debt, liability or obligation of the Company or of any third party.

Borrowing limit

132.

The board shall, in relation to the borrowings of the Company and its subsidiaries for the time being (in these Articles 131 to 138 called the Group ), restrict the borrowings of the Company and exercise all voting and other rights or powers of control exercisable by the Company in relation to its subsidiaries (if any) so as to secure (as regards subsidiaries so far as by such exercise they can secure) that the aggregate nominal or principal amount (together with any fixed or minimum premium payable on final repayment) for the time being owing by the Group in respect of moneys borrowed (exclusive of moneys borrowed by the Company from and for the time being owing to any of its subsidiaries or by any such subsidiary from and for the time being owing to the Company or another such subsidiary of the Company) less cash deposits shall not without the previous sanction of an ordinary resolution exceed an amount equal to the higher of: (i) eight thousand million pounds; and (ii) two and a half times the adjusted total of capital and reserves.

Definitions

133.

For the purpose of Articles 132 to 137:

(a)

the expression the adjusted total of capital and reserves means the aggregate of:

(i)

the amount for the time being paid up on the issued share capital of the Company; and

Page 30

(ii)

the amounts standing to the credit of the consolidated reserves of the Group (including the balances standing to the credit of profit and loss account and share premium account, including the Company’s appropriate share of the reserves of its associated undertakings) as shown in the last audited consolidated balance sheet of the Group and of the Company’s equity interest in associated undertakings after making such adjustments as in the opinion of the auditors may be appropriate, including adjustments to take account of any alterations to such reserves resulting from any distributions or any issues of share capital whether for cash or other consideration (including any transfers to share premium account in connection therewith) or any payments up by capitalisation from reserves of share capital theretofore not paid up or any reductions of paid up share capital or share premium account which may have taken place since the date of such balance sheet, less any amounts included in the reserves and appearing on such consolidation as being reserved or set aside for future taxation assessable by reference to profits earned down to the date to which such balance sheets are made up and after adding back an appropriate proportion of the amount of goodwill arising on acquisitions, made since 31 March 1989, of companies and businesses remaining within the Group or associated undertakings of the Company which, as at the date of the last such audited consolidated balance sheet, has been written off against reserves in accordance with United Kingdom accounting practices, the appropriate proportion of an amount of goodwill arising on any such acquisition being such amount thereof as would not have been amortised by such date if such goodwill were to be amortised over forty years;

	(b)		the expression *cash deposits* means all cash deposits (otherwise than on current account) with banks (not being the Company or any subsidiary of the Company), certificates of deposit and securities of governments and companies and similar instruments owned by the Company and/or any subsidiary of the Company which are or represent amounts available (or which will become available) for repayment of any moneys borrowed;

	(c)		the nominal or principal amount of any share capital, debentures or moneys borrowed from any person or body, the beneficial interest in which or the right to payment or repayment of which is not for the time being owned by and the repayment of which is guaranteed or secured by or is the subject of an indemnity given or assumed by the Company or any of its subsidiaries (but in the case of a subsidiary only that proportion hereof as the equity share capital of such subsidiary which is beneficially owned directly or indirectly by the Company bears to the total equity share capital of such subsidiary) shall be deemed to be moneys borrowed by the Company.

Treatment of capital

134.

For the purpose of Articles 132 to 137 capital allotted shall be treated as issued and any capital already called up or payable at any fixed future date shall be treated as already paid up.

Page 31

Moneys borrowed

135.

Moneys borrowed for the purpose and within four months applied in repaying other borrowed moneys falling to be taken into account shall not themselves be taken into account until such application.

Subsidiaries

136.

For the purpose of Articles 132 to 137 there shall be included in the meanings of moneys borrowed and cash deposits such proportion of the money borrowed by, or cash deposits of, a subsidiary company as the equity share capital of such subsidiary which is beneficially owned directly or indirectly by the Company bears to the total equity share capital of such subsidiary and the remainder of the money borrowed by, and the cash deposits of, such subsidiary shall be excluded.

Determining whether limit breached

137.

A certificate or report by the auditors for the time being of the Company as to the amount of the adjusted total of capital and reserves or the amount of any moneys borrowed or to the effect that the limit imposed by Articles 132 to 136 has not been or will not be exceeded at any particular time or times shall be conclusive evidence of such amount or fact for the purposes of Articles 132 to 136.

Persons dealing with the Company

138.

No person dealing with the Company or any of its subsidiaries shall by reason of the foregoing provisions be concerned to see or enquire whether this limit is observed and no debt incurred or security given in excess of such limit shall be invalid or ineffectual unless the lender or the recipient of the security had at the time when the debt was incurred or security given express notice that the limit hereby imposed had been or would thereby be exceeded.

DISQUALIFICATION AND REMOVAL OF DIRECTORS

Disqualification of a director

139.

A person ceases to be a director as soon as:

	(a)		that person ceases to be a director by virtue of any provision of the Act or is prohibited from being a director by law;

	(b)		a bankruptcy order is made against that person;

	(c)		a composition is made with that person’s creditors generally in satisfaction of that person’s debts;

	(d)		a registered medical practitioner who is treating that person gives a written opinion to the Company stating that that person has become physically or mentally incapable of acting as a director and may remain so for more than three months;

	(e)		by reason of that person’s mental health, a court makes an order which wholly or partly prevents that person from personally exercising any powers or rights which that person would otherwise have;

	(f)		notification is received by the Company from the director that the director is resigning or retiring from office, and such resignation or retirement has taken effect in accordance with its terms, or his office as a director is vacated pursuant to Article 115; or

Page 32

(g)

that person receives notice signed by not less than three quarters of the other directors stating that that person should cease to be a director. In calculating the number of directors who are required to give such notice to the director: (i) an alternate director appointed by him acting in his capacity as such shall be excluded; and (ii) a director and any alternate director appointed by him and acting in his capacity as such shall constitute a single director for this purpose, so that notice by either shall be sufficient.

Power of Company to remove director

140.

The Company may, without prejudice to the provisions of the Companies Acts, by ordinary resolution remove any director from office (notwithstanding any provision of these Articles or of any agreement between the Company and such director, but without prejudice to any claim he may have for damages for breach of any such agreement). No special notice need be given of any resolution to remove a director in accordance with this Article and no director proposed to be removed in accordance with this Article has any special right to protest against his removal. The Company may, by ordinary resolution, appoint another person in place of a director removed from office in accordance with this Article. Any person so appointed shall, for the purpose of determining the time at which he or any other director is to retire by rotation, be treated as if he had become a director on the day on which the director in whose place he is appointed was last elected a director. In default of such appointment the vacancy arising on the removal of a director from office may be filled as a casual vacancy.

NON-EXECUTIVE DIRECTORS

Arrangements with non-executive directors

141.

Subject to the provisions of the Companies Acts, the board may enter into, vary and terminate an agreement or arrangement with any director who does not hold executive office for the provision of his services to the Company. Subject to Articles 142 and 143, any such agreement or arrangement may be made on such terms as the board determines.

Ordinary remuneration

142.

The ordinary remuneration of the directors who do not hold executive office for their services (excluding amounts payable under any other provision of these Articles) shall not exceed in aggregate £500,000 per annum or such higher amount as the Company may from time to time by ordinary resolution determine. Subject thereto, each such director shall be paid a fee for their services (which shall be deemed to accrue from day to day) at such rate as may from time to time be determined by the board.

Additional remuneration

143.

The directors may grant extra remuneration to any director who does not hold executive office and who serves on any committee of the board or, being called upon, performs any other special or extra services to or at the request of the Company. Such extra remuneration may be made payable to such director in addition to or in substitution for his ordinary remuneration (if any) as a director, and may, without prejudice to the provisions of Article 142, be made payable by a lump sum or by way of salary or commission on the dividends or profits of the Company or of any other company in which the Company is interested or other participation in any such profits or otherwise, or by any or all or partly by one and partly by another or other of those modes.

Page 33

DIRECTORS’ EXPENSES

Directors may be paid expenses

144.

The directors may be paid all travelling, hotel, and other expenses properly incurred by them in connection with their attendance at meetings of the board or committees of the board or general meetings or separate meetings of the holders of any class of shares or of debentures of the Company or otherwise in connection with the discharge of their duties.

EXECUTIVE DIRECTORS

Appointment to executive office

145.

Subject to the provisions of the Companies Acts, the board may appoint one or more of its body to be the holder of any executive office (except that of auditor) in the Company and may enter into an agreement or arrangement with any such director for his employment by the Company or for the provision by him of any services outside the scope of the ordinary duties of a director. Any such appointment, agreement or arrangement may be made on such terms, including, without limitation, terms as to remuneration, as the board determines. The board may revoke or vary any such appointment but without prejudice to any rights or claims which the person whose appointment is revoked or varied may have against the Company because of the revocation or variation.

Termination of appointment to executive office

146.

Any appointment of a director to an executive office shall terminate if he ceases to be a director but without prejudice to any rights or claims which he may have against the Company by reason of such cessation. A director appointed to an executive office shall not cease to be a director merely because his appointment to such executive office terminates.

Emoluments to be determined by the board

147.

The emoluments of any director holding executive office for his services as such shall be determined by the board, and may be of any description, including (without limitation) admission to, or continuance of, membership of any scheme (including any share acquisition scheme) or fund instituted or established or financed or contributed to by the Company for the provision of pensions, life assurance or other benefits for employees or their dependants, or the payment of a pension or other benefits to him or his dependants on or after retirement or death, apart from membership of any such scheme or fund.

DIRECTORS’ INTERESTS

Authorisation under s175 of the Act

148.

For the purposes of section 175 of the Act, the board may authorise any matter proposed to it in accordance with these Articles which would, if not so authorised, involve a breach of duty by a director under that section, including, without limitation, any matter which relates to a situation in which a director has, or can have, an interest which conflicts, or possibly may conflict, with the interests of the Company. Any such authorisation will be effective only if:

(a)

any requirement as to quorum at the meeting at which the matter is considered is met without counting the director in question or any other interested director; and

Page 34

(b)

the matter was agreed to without their voting or would have been agreed to if their votes had not been counted.

		The board may (whether at the time of the giving of the authorisation or subsequently) make any such authorisation subject to any limits or conditions it expressly imposes but such authorisation is otherwise given to the fullest extent permitted. The board may vary or terminate any such authorisation at any time.

		For the purposes of the Articles, a conflict of interest includes a conflict of interest and duty and a conflict of duties, and interest includes both direct and indirect interests.

Director may contract with the Company and hold other offices etc.

149.

Provided that he has disclosed to the board the nature and extent of his interest (unless the circumstances referred to in section 177(5) or section 177(6) of the Act apply, in which case no such disclosure is required) a director notwithstanding his office:

	(a)		may be a party to, or otherwise interested in, any transaction or arrangement with the Company or in which the Company is otherwise (directly or indirectly) interested;

	(b)		may act by himself or his firm in a professional capacity for the Company (otherwise than as auditor) and he or his firm shall be entitled to remuneration for professional services as if he were not a director; and

	(c)		may be a director or other officer of, or employed by, or a party to a transaction or arrangement with, or otherwise interested in, any body corporate:

	(i)		in which the Company is (directly or indirectly) interested as shareholder or otherwise; or

	(ii)		with which he has such a relationship at the request or direction of the Company.

Remuneration, benefits etc.

150.

A director shall not, by reason of his office, be accountable to the Company for any remuneration or other benefit which he derives from any office or employment or from any transaction or arrangement or from any interest in any body corporate:

	(a)		the acceptance, entry into or existence of which has been approved by the board pursuant to Article 148 (subject, in any such case, to any limits or conditions to which such approval was subject); or

	(b)		which he is permitted to hold or enter into by virtue of paragraph (a), (b) or (c) of Article 149;

nor shall the receipt of any such remuneration or other benefit constitute a breach of his duty under section 176 of the Act.

Page 35

Notification of interests

151.

Any disclosure required by Article 149 may be made at a meeting of the board, by notice in writing or by general notice or otherwise in accordance with section 177 of the Act.

Duty of confidentiality to another person

152.

A director shall be under no duty to the Company with respect to any information which he obtains or has obtained otherwise than as a director of the Company and in respect of which he owes a duty of confidentiality to another person. However, to the extent that his relationship with that other person gives rise to a conflict of interest or possible conflict of interest, this Article applies only if the existence of that relationship has been approved by the board pursuant to Article 148. In particular, the director shall not be in breach of the general duties he owes to the Company by virtue of sections 171 to 177 of the Act because he fails:

	(a)		to disclose any such information to the board or to any director or other officer or employee of the Company; and/or

	(b)		to use or apply any such information in performing his duties as a director of the Company.

Consequences of authorisation

153.

Where the existence of a director’s relationship with another person has been approved by the board pursuant to Article 148 and his relationship with that person gives rise to a conflict of interest or possible conflict of interest, the director shall not be in breach of the general duties he owes to the Company by virtue of sections 171 to 177 of the Act because he:

	(a)		absents himself from meetings of the board at which any matter relating to the conflict of interest or possible conflict of interest will or may be discussed or from the discussion of any such matter at a meeting or otherwise; and/or

	(b)		makes arrangements not to receive documents and information relating to any matter which gives rise to the conflict of interest or possible conflict of interest sent or supplied by the Company and/or for such documents and information to be received and read by a professional adviser,

for so long as he reasonably believes such conflict of interest or possible conflict of interest subsists.

Without prejudice to equitable principles or rule of law

154.

The provisions of Articles 152 and 153 are without prejudice to any equitable principle or rule of law which may excuse the director from:

	(a)		disclosing information, in circumstances where disclosure would otherwise be required under these Articles; or

	(b)		attending meetings or discussions or receiving documents and information as referred to in Article 153, in circumstances where such attendance or receiving such documents and information would otherwise be required under these Articles.

Page 36

GRATUITIES, PENSIONS AND INSURANCE

Gratuities and pensions

155.

The board may (by establishment of, or maintenance of, schemes or otherwise) provide benefits, whether by the payment of gratuities or pensions or by insurance or otherwise, for any past or present director or employee of the Company or any of its subsidiary undertakings or any body corporate associated with, or any business acquired by, any of them, and for any member of his family (including a spouse, a civil partner, a former spouse and a former civil partner) or any person who is or was dependent on him, and may (as well before as after he ceases to hold such office or employment) contribute to any fund and pay premiums for the purchase or provision of any such benefit.

Insurance

156.

Without prejudice to the provisions of Article 225, the board may exercise all the powers of the Company to purchase and maintain insurance for or for the benefit of any person who is or was:

	(a)		a director, officer or employee of the Company, or of any other body which is or was the holding company or subsidiary undertaking of the Company or in which the Company or such holding company or subsidiary undertaking has or had any interest (whether direct or indirect) or with which the Company or such holding company or subsidiary undertaking is or was in any way allied or associated; or

	(b)		a trustee of any pension fund in which employees of the Company or of any other body referred to in paragraph (a) of this Article are or have been interested,

including, without limitation, insurance against any liability incurred by such person in respect of any act or omission in the actual or purported execution or discharge of his duties or in the exercise or purported exercise of his powers or otherwise in relation to his duties, powers or offices in relation to the relevant body or fund.

Directors not liable to account

157.

No director or former director shall be accountable to the Company or the members for any benefit provided pursuant to these Articles. The receipt of any such benefit shall not disqualify any person from being or becoming a director of the Company.

Section 247 of the Act

158.

The board may make provision for the benefit of any persons employed or formerly employed by the Company or any of its subsidiaries other than a director or former director or shadow director in connection with the cessation or the transfer of the whole or part of the undertaking of the Company or any subsidiary. Any such provision shall be made by a resolution of the board in accordance with section 247 of the Act.

PROCEEDINGS OF THE BOARD

Convening meetings and proceedings

159.

Subject to the provisions of these Articles, the board may regulate its proceedings as it thinks fit. A director may, and the secretary at the request of a director shall, call a meeting of the board by giving notice of the meeting to each director. Notice of a board meeting shall be deemed to be given to a director if it is

Page 37

given to him personally or by word of mouth or sent in hard copy form to him at his last known address or such other address (if any) as may for the time being be specified by him or on his behalf to the Company for that purpose, or sent in electronic form to such address (if any) for the time being specified by him or on his behalf to the Company for that purpose. A director absent or intending to be absent from the United Kingdom may request the board that notices of board meetings shall during his absence be sent in hard copy form or in electronic form to such address (if any) for the time being specified by him or on his behalf to the Company for that purpose, but such notices need not be sent any earlier than notices sent to directors not so absent and, if no such request is made to the board, it shall not be necessary to send notice of a board meeting to any director who is for the time being absent from the United Kingdom. No account is to be taken of directors absent from the United Kingdom when considering the adequacy of the period of notice of the meeting. Questions arising at a meeting shall be decided by a majority of votes. In the case of an equality of votes, the chairman shall have a second or casting vote. Any director may waive notice of a meeting and any such waiver may be retrospective. Any notice pursuant to this Article need not be in writing if the board so determines and any such determination may be retrospective.

Quorum

160.

The quorum for the transaction of the business of the board may be fixed by the board and unless so fixed at any other number shall be two. A person who holds office only as an alternate director may, if his appointer is not present, be counted in the quorum. Any director who ceases to be a director at a board meeting may continue to be present and to act as a director and be counted in the quorum until the termination of the board meeting if no director objects.

Powers of directors if number falls below minimum

161.

The continuing directors or a sole continuing director may act notwithstanding any vacancies in their number, but if the number of directors is less than the number fixed as the quorum, the continuing directors or director may act only for the purpose of filling vacancies or of calling a general meeting.

Chairman and deputy chairman

162.

The board may appoint one of their number to be the chairman, and one of their number to be the deputy chairman, of the board and may at any time remove either of them from such office. Unless he is unwilling to do so, the director appointed as chairman, or in his stead the director appointed as deputy chairman, shall preside at every meeting of the board at which he is present. If there is no director holding either of those offices, or if neither the chairman nor the deputy chairman is willing to preside or neither of them is present within five minutes after the time appointed for the meeting, the directors present may appoint one of their number to be chairman of the meeting.

Validity of acts of the board

163.

All acts done by a meeting of the board, or of a committee of the board, or by a person acting as a director or alternate director, shall, notwithstanding that it be afterwards discovered that there was a defect in the appointment of any director or any member of the committee or alternate director or that any of them were disqualified from holding office, or had vacated office, or were not entitled to vote, be as valid as if every such person had been duly appointed and was qualified and had continued to be a director or, as the case may be, an alternate director and had been entitled to vote.

Page 38

Resolutions in writing

164.

A resolution in writing agreed to by all the directors entitled to receive notice of a meeting of the board or of a committee of the board (not being less than the number of directors required to form a quorum of the board) shall be as valid and effectual as if it had been passed at a meeting of the board or (as the case may be) a committee of the board duly convened and held. For this purpose:

	(a)		a director signifies his agreement to a proposed written resolution when the Company receives from him a document indicating his agreement to the resolution authenticated in the manner permitted by the Companies Acts for a document in the relevant form;

	(b)		the director may send the document in hard copy form or in electronic form to such address (if any) for the time being specified by the Company for that purpose;

	(c)		if an alternate director signifies his agreement to the proposed written resolution, his appointer need not also signify his agreement; and

	(d)		if a director signifies his agreement to the proposed written resolution, an alternate director appointed by him need not also signify his agreement in that capacity.

Meetings by telephone, etc

165.

Without prejudice to the first sentence of Article 159, a person entitled to be present at a meeting of the board or of a committee of the board shall be deemed to be present for all purposes if he is able (directly or by electronic communication) to speak to and be heard by all those present or deemed to be present simultaneously. A director so deemed to be present shall be entitled to vote and be counted in a quorum accordingly. Such a meeting shall be deemed to take place where it is convened to be held or (if no director is present in that place) where the largest group of those participating is assembled, or, if there is no such group, where the chairman of the meeting is. The word meeting in these Articles shall be construed accordingly.

Directors power to vote on contracts in which they are interested

166.

Except as otherwise provided by these Articles, a director shall not vote at a meeting of the board or a committee of the board on any resolution of the board concerning a matter in which he has an interest (other than by virtue of his interests in shares or debentures or other securities of, or otherwise in or through, the Company) which can reasonably be regarded as likely to give rise to a conflict with the interests of the Company, unless his interest arises only because the resolution concerns one or more of the following matters:

	(a)		the giving of a guarantee, security or indemnity in respect of money lent or obligations incurred by him or any other person at the request of or for the benefit of, the Company or any of its subsidiary undertakings;

	(b)		the giving of a guarantee, security or indemnity in respect of a debt or obligation of the Company or any of its subsidiary undertakings for which the director has assumed responsibility (in whole or part and whether alone or jointly with others) under a guarantee or indemnity or by the giving of security;

Page 39

	(c)		a contract, arrangement, transaction or proposal concerning an offer of shares, debentures or other securities of the Company or any of its subsidiary undertakings for subscription or purchase, in which offer he is or may be entitled to participate as a holder of securities or in the underwriting or sub-underwriting of which he is to participate;

	(d)		a contract, arrangement, transaction or proposal concerning any other body corporate in which he or any person connected with him is interested, directly or indirectly, and whether as an officer, shareholder, creditor or otherwise, if he and any persons connected with him do not to his knowledge hold an interest (as that term is used in sections 820 to 825 of the Act) representing one per cent. or more of either any class of the equity share capital (excluding any shares of that class held as treasury shares) of such body corporate (or any other body corporate through which his interest is derived) or of the voting rights available to members of the relevant body corporate (any such interest being deemed for the purpose of this Article to be likely to give rise to a conflict with the interests of the Company in all circumstances);

	(e)		a contract, arrangement, transaction or proposal for the benefit of employees of the Company or of any of its subsidiary undertakings which does not award him any privilege or benefit not generally accorded to the employees to whom the arrangement relates; and

	(f)		a contract, arrangement, transaction or proposal concerning any insurance which the Company is empowered to purchase or maintain for, or for the benefit of, any directors of the Company or for persons who include directors of the Company.

For the purposes of this Article, in relation to an alternate director, an interest of his appointer shall be treated as an interest of the alternate director without prejudice to any interest which the alternate director has otherwise.

Shareholder approval

167.

The Company may by ordinary resolution suspend or relax to any extent, either generally or in respect of any particular matter, any provision of these Articles prohibiting a director from voting at a meeting of the board or of a committee of the board.

Division of proposals

168.

Where proposals are under consideration concerning the appointment (including, without limitation, fixing or varying the terms of appointment) of two or more directors to offices or employments with the Company or any body corporate in which the Company is interested, the proposals may be divided and considered in relation to each director separately. In such cases each of the directors concerned shall be entitled to vote in respect of each resolution except that concerning his own appointment.

Decision of chairman final and conclusive

169.

If a question arises at a meeting of the board or of a committee of the board as to the entitlement of a director to vote, the question may, before the conclusion of the meeting, be referred to the chairman of the meeting and his ruling in relation to any director other than himself shall be final and conclusive except in a case where the nature or extent of the interests of the director concerned have not been fairly

Page 40

disclosed. If any such question arises in respect of the chairman of the meeting, it shall be decided by resolution of the board (on which the chairman shall not vote) and such resolution will be final and conclusive except in a case where the nature and extent of the interests of the chairman have not been fairly disclosed.

SECRETARY

Appointment and removal of secretary

170.

Subject to the provisions of the Companies Acts, the secretary shall be appointed by the board for such term, at such remuneration and on such conditions as it may think fit. The board may, in addition, and at any time and from time to time appoint any person to be assistant or deputy secretary and anything required or authorised to be done by or to the secretary may be done by or to any assistant or deputy secretary so appointed. Any secretary or assistant or deputy secretary so appointed may be removed by the board, but without prejudice to any claim for damages for breach of any contract of service between him and the Company.

MINUTES

Minutes required to be kept

171.

The board shall cause minutes to be recorded for the purpose of:

	(a)		all appointments of officers made by the board; and

	(b)		all proceedings at meetings of the Company, the holders of any class of shares in the capital of the Company, the board and committees of the board, including the names of the directors present at each such meeting.

Conclusiveness of minutes

172.

Any such minutes, if purporting to be authenticated by the chairman of the meeting to which they relate or of the next meeting, shall be sufficient evidence of the proceedings at the meeting without any further proof of the facts stated in them.

THE SEAL

Authority required for use of seal

173.

The seal shall only be used by the authority of a resolution of the board or of a committee of the board. The board may determine who shall sign any document executed under the seal and unless otherwise so determined it shall be signed by at least one director and the secretary or by at least two directors. Any document may be executed under the seal by impressing the seal by mechanical means or by printing the seal or a facsimile of it on the document or by applying the seal or a facsimile of it by any other means to the document.

Certificates for shares and debentures

174.

The board may by resolution determine either generally or in any particular case that any certificate for shares or debentures or representing any other form of security may have any signature affixed to it by some mechanical or electronic means, or printed thereon and that in the case of a certificate executed under the seal need not bear any signature.

Execution of instrument as a deed under hand

175.

Any document executed, with the authority of a resolution of the board or of a committee of the board, in any manner permitted by section 44(2) of the Act and expressed (in whatever form of words) to be executed by the Company shall have the same effect as if executed under the seal.

Page 41

Delivery of deeds

176.

A document which is executed by the Company as a deed shall not be deemed to be delivered by the Company solely as a result of its having been executed by the Company.

REGISTERS

Overseas and local registers

177.

Subject to the provisions of the Companies Acts and the Regulations, the Company may keep an overseas or local or other register in any place, and the board may make, amend and revoke any regulations it thinks fit about the keeping of that register.

Authentication and certification of copies and extracts

178.

Any director or the secretary or any other person appointed by the board for the purpose shall have power to authenticate and certify as true copies of and extracts from:

	(a)		any document comprising or affecting the constitution of the Company, whether in hard copy form or electronic form;

	(b)		any resolution passed by the Company, the holders of any class of shares in the capital of the Company, the board or any committee of the board, whether in hard copy form or electronic form; and

	(c)		any book, record and document relating to the business of the Company, whether in hard copy form or electronic form (including, without limitation, the accounts).

If certified in this way, a document purporting to be a copy of a resolution, or the minutes or an extract from the minutes of a meeting of the Company, the holders of any class of shares in the capital of the Company, the board or a committee of the board, whether in hard copy form or electronic form, shall be conclusive evidence in favour of all persons dealing with the Company in reliance on it or them that the resolution was duly passed or that the minutes are, or the extract from the minutes is, a true and accurate record of proceedings at a duly constituted meeting.

DIVIDENDS

Declaration of dividends

179.

Subject to the provisions of the Companies Acts, the Company may by ordinary resolution declare dividends in accordance with the respective rights of the members, but no dividend shall exceed the amount recommended by the board.

Interim dividends

180.

Subject to the provisions of the Companies Acts, the board may pay interim dividends if it appears to the board that they are justified by the profits of the Company available for distribution. If the share capital is divided into different classes, the board may pay interim dividends on shares which confer deferred or non-preferred rights with regard to dividends as well as on shares which confer preferential rights with regard to dividends, but no interim dividend shall be paid on shares carrying deferred or non-preferred rights if, at the time of payment, any preferential dividend is in arrear. The board may also pay at intervals settled by it any dividend payable at a fixed rate if it appears to the board that the profits available for distribution justify the payment. Provided the board acts in good faith it shall not incur

Page 42

any liability to the holders of shares conferring preferred rights for any loss they may suffer by the lawful payment of an interim dividend on any shares having deferred or non-preferred rights.

Declaration and payment in different currencies

181.

Dividends may be declared and paid in any currency or currencies that the board shall determine. The board may also determine the exchange rate and the relevant date for determining the value of the dividend in any currency.

Apportionment of dividends

182.

Except as otherwise provided by the rights attached to shares, all dividends shall be declared and paid according to the amounts paid up on the shares on which the dividend is paid; but no amount paid on a share in advance of the date on which a call is payable shall be treated for the purpose of this Article as paid on the share. All dividends shall be apportioned and paid proportionately to the amounts paid up on the shares during any portion or portions of the period in respect of which the dividend is paid; but, if any share is allotted or issued on terms providing that it shall rank for dividend as from a particular date, that share shall rank for dividend accordingly.

Dividends in specie

183.

A general meeting declaring a dividend may, on the recommendation of the board, by ordinary resolution direct that it shall be satisfied wholly or partly by the distribution of assets including, without limitation, paid up shares or debentures of any other body corporate. Where any difficulty arises regarding the distribution, the board may make any arrangements as it thinks fit to settle the same, including without limitation: (a) the fixing of the value for distribution of any assets; (b) the payment of cash to any member on the basis of the value so fixed in order to adjust the rights of members; and (c) the vesting of any assets in trustees.

Scrip dividends: authorising resolution

184.

The board may, if authorised by an ordinary resolution of the Company (the Resolution ), offer any holder of shares the right to elect to receive shares, credited as fully paid, instead of cash in respect of the whole (or some part, to be determined by the board) of all or any dividend specified by the Resolution. The offer shall be on the terms and conditions and be made in the manner specified in Article 185 or, subject to those provisions, specified in the Resolution.

Scrip dividends: procedures

185.

The following provisions shall apply to the Resolution and any offer made pursuant to it and Article 184.

	(a)		The Resolution may specify a particular dividend, or may specify all or any dividends declared within a specified period.

	(b)		Each holder of shares shall be entitled to that number of new shares as are together as nearly as possible equal in value to (but not greater than) the cash amount (disregarding any tax credit) of the dividend that such holder elects to forgo (each a *new share* ). For this purpose, the value of each new share shall be:

(i)

equal to the average quotation for the Company’s ordinary shares, that is, the average of the middle market quotations for those shares on the London Stock Exchange plc, as derived from the Daily Official List, on the day on which such shares are first quoted ex the relevant dividend and the four subsequent dealing days; or

Page 43

(ii)

calculated in any other manner specified by the Resolution,

			but shall never be less than the par value of the new share.

			A certificate or report by the auditors as to the value of a new share in respect of any dividend shall be conclusive evidence of that value.

	(c)		On or as soon as practicable after announcing that any dividend is to be declared or recommended, the board, if it intends to offer an election in respect of that dividend, shall also announce that intention. If, after determining the basis of allotment, the board decides to proceed with the offer, it shall notify the holders of shares of the terms and conditions of the right of election offered to them, specifying the procedure to be followed and place at which, and the latest time by which, elections or notices amending or terminating existing elections must be delivered in order to be effective.

	(d)		The board shall not proceed with any election unless the board has sufficient authority to allot shares and sufficient reserves or funds that may be appropriated to give effect to it after the basis of allotment is determined.

	(e)		The board may exclude from any offer any holders of shares where the board believes the making of the offer to them would or might involve the contravention of the laws of any territory or that for any other reason the offer should not be made to them.

	(f)		The dividend (or that part of the dividend in respect of which a right of election has been offered) shall not be payable in cash on shares in respect of which an election has been made (the *elected shares* ) and instead such number of new shares shall be allotted to each holder of elected shares as is arrived at on the basis stated in paragraph (b) of this Article. For that purpose the board shall appropriate out of any amount for the time being standing to the credit of any reserve or fund (including, without limitation, the profit and loss account), whether or not it is available for distribution, a sum equal to the aggregate nominal amount of the new shares to be allotted and apply it in paying up in full the appropriate number of new shares for allotment and distribution to each holder of elected shares as is arrived at on the basis stated in paragraph (b) of this Article.

	(g)		The new shares when allotted shall rank equally in all respects with the fully paid shares of the same class then in issue except that they shall not be entitled to participate in the relevant dividend.

	(h)		No fraction of a share shall be allotted. The board may make such provision as it thinks fit for any fractional entitlements including, without limitation, payment in cash to holders in respect of their fractional entitlements, provision for the accrual, retention or accumulation of all or part of the benefit of fractional entitlements to or by the Company or to or by or on behalf of any holder or the application of any accrual, retention or accumulation to the allotment of fully paid shares to any holder.

Page 44

	(i)		The board may do all acts and things it considers necessary or expedient to give effect to the allotment and issue of any share pursuant to this Article or otherwise in connection with any offer made pursuant to this Article and may authorise any person, acting on behalf of the holders concerned, to enter into an agreement with the Company providing for such allotment or issue and incidental matters. Any agreement made under such authority shall be effective and binding on all concerned.

	(j)		The board may, at its discretion, amend, suspend or terminate any offer pursuant to this Article.

Permitted deductions and retentions

186.

The board may deduct from any dividend, or other moneys payable to any member in respect of a share, any moneys presently payable by him to the Company in respect of that share. Where a person is entitled by transmission to a share, the board may retain any dividend payable in respect of that share until that person (or that person’s transferee) becomes the holder of that share.

Procedure for payment to holders and others entitled

187.

Any dividend or other moneys payable in respect of a share may be paid:

	(a)		in cash; or

	(b)		by cheque or warrant made payable to or to the order of the holder or person entitled to payment; or

	(c)		by any direct debit, bank or other funds transfer system to the holder or person entitled to payment or, if practicable, to a person designated by notice to the Company by the holder or person entitled to payment; or

	(d)		by any other method approved by the board and agreed (in such form as the Company thinks appropriate) by the holder or person entitled to payment, including (without limitation) in respect of an uncertificated share, by means of the relevant system (subject to the facilities and requirements of the relevant system).

Joint entitlement

188.

If two or more persons are registered as joint holders of any share, or are entitled by transmission jointly to a share, the Company may:

	(a)		pay any dividend or other moneys payable in respect of the share to any one of them and any one of them may give effectual receipt for that payment; and

	(b)		for the purpose of Article 187, rely in relation to the share on the written direction, designation or agreement of, or notice to the Company by, any one of them.

Payment by post

189.

A cheque or warrant may be sent by post:

(a)

where a share is held by a sole holder, to the registered address of the holder of the share; or

Page 45

	(b)		if two or more persons are the holders, to the registered address of the person who is first named in the register; or

	(c)		if a person is entitled by transmission to the share, as if it were a notice to be sent under Article 205; or

	(d)		in any case, to such person and to such address as the person entitled to payment may direct by notice to the Company.

Discharge to Company and risk

190.

Payment of a cheque or warrant by the bank on which it was drawn or the transfer of funds by the bank instructed to make the transfer or, in respect of an uncertificated share, the making of payment in accordance with the facilities and requirements of the relevant system (which, if the relevant system is CREST, may include the sending by the Company or by any person on its behalf of an instruction to the Operator of the relevant system to credit the cash memorandum account of the holder or joint holders or, if permitted by the Company, of such person as the holder or joint holders may in writing direct) shall be a good discharge to the Company. Every cheque or warrant sent or transfer of funds made by the relevant bank or system in accordance with these Articles shall be at the risk of the holder or person entitled. The Company shall have no responsibility for any sums lost or delayed in the course of payment by any method used by the Company in accordance with Article 187.

Interest not payable

191.

No dividend or other moneys payable in respect of a share shall bear interest against the Company unless otherwise provided by the rights attached to the share.

Forfeiture of unclaimed dividends

192.

Any dividend which has remained unclaimed for 12 years from the date when it became due for payment shall, if the board so resolves, be forfeited and cease to remain owing by the Company. The payment of any unclaimed dividend or other moneys payable in respect of a share may (but need not) be paid by the Company into an account separate from the Company’s own account. Such payment shall not constitute the Company a trustee in respect of it. The Company shall be entitled to cease sending dividend warrants and cheques by post or otherwise to a member if those instruments have been returned undelivered to, or left uncashed by, that member on at least two consecutive occasions, or, following one such occasion, reasonable enquiries have failed to establish the member’s new address. The entitlement conferred on the Company by this Article in respect of any member shall cease if the member claims a dividend or cashes a dividend warrant or cheque.

CAPITALISATION OF PROFITS AND RESERVES

Power to capitalise

193.

The board may with the authority of an ordinary resolution of the Company:

	(a)		subject to the provisions of this Article, resolve to capitalise any undistributed profits of the Company not required for paying any preferential dividend (whether or not they are available for distribution) or any sum standing to the credit of any reserve or other fund including, without limitation, the Company’s share premium account and capital redemption reserve, if any;

	(b)		appropriate the sum resolved to be capitalised to the members or any class of members on the record date specified in the relevant resolution who would

Page 46

			have been entitled to it if it were distributed by way of dividend and in the same proportions and apply such sum on their behalf either in or towards paying up the amounts, if any, for the time being unpaid on any shares held by them respectively, or in paying up in full shares, debentures or other obligations of the Company of a nominal amount equal to that sum, and allot the shares, debentures or other obligations credited as fully paid to those members, or as they may direct, in those proportions, or partly in one way and partly in the other; but the share premium account, the capital redemption reserve, and any profits which are not available for distribution may, for the purposes of this Article, only be applied in paying up shares to be allotted to members credited as fully paid;

	(c)		where shares or debentures become, or would otherwise become, distributable under this Article in fractions, make such provision as they think fit for dealing with any fractional entitlements including, without limitation, authorising their sale and transfer to any person, or resolving that the distribution be made as nearly as practicable in the correct proportion but not exactly so, or ignoring fractions altogether or resolving that cash payments be made to any members in order to adjust the rights of all parties;

	(d)		authorise any person to enter into an agreement with the Company on behalf of all the members concerned providing for either:

	(i)		the allotment to the members respectively, credited as fully paid, of any shares, debentures or other obligations to which they are entitled upon such capitalisation; or

	(ii)		the payment up by the Company on behalf of the members of the amounts, or any part of the amounts, remaining unpaid on their existing shares by the application of their respective proportions of the sum resolved to be capitalised,

			and any agreement made under such authority shall be binding on all such members;

	(e)		for the purposes of this Article, unless the relevant resolution provides otherwise, if the Company holds treasury shares of the relevant class at the record date specified in the relevant resolution, it shall be treated as if it were entitled to receive the dividends in respect of those treasury shares which would have been payable if those treasury shares had been held by a person other than the Company; and

	(f)		generally do all acts and things required to give effect to the ordinary resolution.

RECORD DATES

Record dates for dividends, etc

194.

Notwithstanding any other provision of these Articles, the Company or the board may:

Page 47

	(a)		fix any date as the record date for any dividend, distribution, allotment or issue, which may be on or at any time before or after any date on which the dividend, distribution, allotment or issue is declared, paid or made;

	(b)		for the purpose of determining which persons are entitled to attend and vote at a general meeting of the Company, or a separate general meeting of the holders of any class of shares in the capital of the Company, and how many votes such persons may cast, specify in the notice of meeting a time, not more than 48 hours before the time fixed for the meeting (which shall, if the board so specifies, be calculated taking no account of any part of a day that is not a working day), by which a person must be entered on the register in order to have the right to attend or vote at the meeting; changes to the register after the time specified by virtue of this Article shall be disregarded in determining the rights of any person to attend or vote at the meeting; and

	(c)		for the purpose of sending notices of general meetings of the Company, or separate general meetings of the holders of any class of shares in the capital of the Company, under these Articles, determine that persons entitled to receive such notices are those persons entered on the register at the close of business on a day determined by the Company or the board, which day may not be more than 21 days before the day that notices of the meeting are sent.

ACCOUNTS

Rights to inspect records

195.

No member shall (as such) have any right to inspect any accounting records or other book or document of the Company except as conferred by statute or authorised by the board or by ordinary resolution of the Company or order of a court of competent jurisdiction.

Sending of annual accounts

196.

Subject to the Companies Acts, a copy of the Company’s annual accounts, together with a copy of the directors’ report for that financial year and the auditors’ report on those accounts shall, at least 21 clear days before the date of the meeting at which copies of those documents are to be laid in accordance with the provisions of the Companies Acts, be sent to every member and to every holder of the Company’s debentures of whose address the Company is aware, and to every other person who is entitled to receive notice of meetings from the Company under the provisions of the Companies Acts or of these Articles or, in the case of joint holders of any share or debenture, to one of the joint holders,

Summary financial statements

197.

Subject to the Companies Acts, the requirements of Article 196 shall be deemed satisfied in relation to any person by sending to the person, instead of such copies, a summary financial statement derived from the Company’s annual accounts and the directors’ report, which shall be in the form and containing the information prescribed by the Companies Acts and any regulations made under the Companies Acts.

Page 48

COMMUNICATIONS

When notice required to be in writing

198.

Any notice to be sent to or by any person pursuant to these Articles (other than a notice calling a meeting of the board) shall be in writing.

Methods of Company sending notice

199.

Subject to Article 198 and unless otherwise provided by these Articles, the Company shall send or supply a document or information that is required or authorised to be sent or supplied to a member or any other person by the Company by a provision of the Companies Acts or pursuant to these Articles or to any other rules or regulations to which the Company may be subject in such form and by such means as it may in its absolute discretion determine provided that the provisions of the Act which apply to sending or supplying a document or information required or authorised to be sent or supplied by the Companies Acts shall, the necessary changes having been made, also apply to sending or supplying any document or information required or authorised to be sent by these Articles or any other rules or regulations to which the Company may be subject.

Methods of member etc. sending document or information

200.

Subject to Article 198 and unless otherwise provided by these Articles, a member or a person entitled by transmission to a share shall send a document or information pursuant to these Articles to the Company in such form and by such means as it may in its absolute discretion determine provided that:

	(a)		the determined form and means are permitted by the Companies Acts for the purpose of sending or supplying a document or information of that type to a company pursuant to a provision of the Companies Acts; and

	(b)		unless the board otherwise permits, any applicable condition or limitation specified in the Companies Acts including, without limitation, as to the address to which the document or information may be sent, is satisfied.

Unless otherwise provided by these Articles or required by the board, such document or information shall be authenticated in the manner specified by the Companies Acts for authentication of a document or information sent in the relevant form.

Notice to joint holders

201.

In the case of joint holders of a share any document or information shall be sent to the joint holder whose name stands first in the register in respect of the joint holding and any document or information so sent shall be deemed for all purposes sent to all the joint holders.

Registered address outside EEA

202.

A member whose registered address is not within an EEA State and who sends to the Company an address within an EEA State at which a document or information may be sent to him shall be entitled to have the document or information sent to him at that address (provided that, in the case of a document or information sent by electronic means including, without limitation, any notification required by the Companies Acts that the document or information is available on a website, the Company so agrees, which agreement the Company shall be entitled to withhold in its absolute discretion including, without limitation, in circumstances in which the Company considers that the sending of the document or information to such address using electronic means would or might infringe the laws of any other jurisdiction) but otherwise:

Page 49

	(a)		no such member shall be entitled to receive any document or information from the Company; and

	(b)		without prejudice to the generality of the foregoing, any notice of a general meeting of the Company which is in fact sent or purports to be sent to such member shall be ignored for the purpose of determining the validity of the proceedings at such general meeting.

Deemed receipt of notice

203.

A member present, either in person or by proxy, at any meeting of the Company or of the holders of any class of shares in the capital of the Company shall be deemed to have been sent notice of the meeting and, where requisite, of the purposes for which it was called.

Terms and conditions for electronic communications

204.

The board may from time to time issue, endorse or adopt terms and conditions relating to the use of electronic means for the sending of notices, other documents and proxy appointments by the Company to members or persons entitled by transmission and by members or persons entitled by transmission to the Company.

Notice to persons entitled by transmission

205.

A document or information may be sent or supplied by the Company to the person or persons entitled by transmission to a share by sending it in any manner the Company may choose authorised by these Articles for the sending of a document or information to a member, addressed to them by name, or by the title of representative of the deceased, or trustee of the bankrupt or by any similar description at the address (if any) in the United Kingdom as may be supplied for that purpose by or on behalf of the person or persons claiming to be so entitled. Until such an address has been supplied, a document or information may be sent in any manner in which it might have been sent if the death or bankruptcy or other event giving rise to the transmission had not occurred.

Transferees etc. bound by prior notice

206.

Every person who becomes entitled to a share shall be bound by any notice in respect of that share which, before his name is entered in the register, has been sent to a person from whom he derives his title, provided that no person who becomes entitled by transmission to a share shall be bound by any direction notice sent under Article 88 to a person from whom he derives his title.

Proof of sending/when notices etc. deemed sent by post

207.

Proof that a document or information was properly addressed, prepaid and posted shall be conclusive evidence that the document or information was sent or supplied. A document or information sent by the Company to a member by post shall be deemed to have been received:

	(a)		if sent by first class post or special delivery post from an address in the United Kingdom to another address in the United Kingdom, or by a postal service similar to first class post or special delivery post from an address in another country to another address in that other country, on the day following that on which the document or information was posted;

	(b)		if sent by airmail from an address in the United Kingdom to an address outside the United Kingdom, or from an address in another country to an address outside that country (including, without limitation, an address in the United

Page 50

			Kingdom), on the third day following that on which the document or information was posted;

	(c)		in any other case, on the second day following that on which the document or information was posted.

When notices etc. deemed sent by hand

208.

A document or information sent by the Company to a member by hand shall be deemed to have been received by the member when it is handed to the member or left at his registered address or an address notified to the Company in accordance with Article 202.

Proof of sending/when notices etc. deemed sent by electronic means

209.

Proof that a document or information sent or supplied by electronic means was properly addressed shall be conclusive evidence that the document or information was sent or supplied. A document or information sent or supplied by the Company to a member in electronic form shall be deemed to have been received by the member on the day following that on which the document or information was sent to the member. Such a document or information shall be deemed received by the member on that day notwithstanding that the Company becomes aware that the member has failed to receive the relevant document or information for any reason and notwithstanding that the Company subsequently sends a hard copy of such document or information by post to the member.

When notices etc. deemed sent by website

210.

A document or information sent or supplied by the Company to a member by means of a website shall be deemed to have been received by the member:

	(a)		when the document or information was first made available on the website; or

	(b)		if later, when the member is deemed by Article 207, 208 or 209 to have received notice of the fact that the document or information was available on the website. Such a document or information shall be deemed received by the member on that day notwithstanding that the Company becomes aware that the member has failed to receive the relevant document or information for any reason and notwithstanding that the Company subsequently sends a hard copy of such document or information by post to the member.

Notice during disruption of services

211.

Subject to the Companies Acts, if at any time the Company is unable effectively to convene a general meeting by notices sent through the post in the United Kingdom as a result of the suspension or curtailment of postal services, notice of general meeting may be sufficiently given by advertisement in the United Kingdom. Any notice given by advertisement for the purpose of this Article shall be advertised in at least one newspaper having a national circulation. If advertised in more than one newspaper, the advertisements shall appear on the same date. Such notice shall be deemed to have been sent to all persons who are entitled to have notice of meetings sent to them on the day when the advertisement appears. In any such case, the Company shall send confirmatory copies of the notice by post, if at least seven days before the meeting the posting of notices to addresses throughout the United Kingdom again becomes practicable.

Page 51

DESTRUCTION OF DOCUMENTS

Power of Company to destroy documents

212.

The Company shall be entitled to destroy:

	(a)		all instruments of transfer of shares which have been registered, and all other documents on the basis of which any entry is made in the register, at any time after the expiration of six years from the date of registration;

	(b)		all dividend mandates or variations or cancellations thereof and notifications of change of address at any time after the expiration of two years from the date of recording;

	(c)		all share certificates which have been cancelled at any time after the expiration of one year from the date of the cancellation;

	(d)		all paid dividend warrants and cheques at any time after the expiration of one year from the date of actual payment;

	(e)		all proxy appointments which have been used for the purpose of a poll at any time after the expiration of one year from the date of use; and

	(f)		all proxy appointments which have not been used for the purpose of a poll at any time after one month from the end of the meeting to which the proxy appointment relates and at which no poll was demanded.

Presumption regarding destroyed documents

213.

It shall conclusively be presumed in favour of the Company that:

	(a)		every entry in the register purporting to have been made on the basis of an instrument of transfer or other document destroyed in accordance with Article 212 was duly and properly made;

	(b)		every instrument of transfer destroyed in accordance with Article 212 was a valid and effective instrument duly and properly registered;

	(c)		every share certificate destroyed in accordance with Article 212 was a valid and effective certificate duly and properly cancelled; and

	(d)		every other document destroyed in accordance with Article 212 was a valid and effective document in accordance with its recorded particulars in the books or records of the Company,

PROVIDED ALWAYS THAT:

	(e)		the provisions of this Article and Article 212 shall apply only to the destruction of a document in good faith and without notice of any claim (regardless of the parties thereto) to which the document might be relevant;

	(f)		nothing contained in this Article or Article 212 shall be construed as imposing on the Company any liability in respect of the destruction of any such document earlier than the time specified in Article 212 or in any other

Page 52

			circumstances which would not attach to the Company in the absence of this Article or Article 212; and

	(g)		any reference in this Article or Article 212 to the destruction of any document includes a reference to its disposal in any manner.

Early destruction

214.

Any document referred to in Articles 212 and 213 may be destroyed earlier than the relevant date authorised by those Articles, provided that a permanent record of the document is made which record is not destroyed before that date.

UNTRACED SHAREHOLDERS

Power to dispose of shares of untraced shareholders

215.

The Company shall be entitled to sell, at the best price reasonably obtainable, the shares of a member or the shares to which a person is entitled by transmission if:

	(a)		during the period of twelve years prior to the date of the publication of the advertisements referred to in paragraph (b) of this Article (or, if published on different dates, the first date) (the *relevant period* ) at least three dividends in respect of the shares in question have been declared and all dividend warrants and cheques which have been sent in the manner authorised by these Articles in respect of the shares in question have remained uncashed;

	(b)		the Company shall as soon as practicable after expiry of the relevant period have inserted advertisements both in a national daily newspaper and in a newspaper circulating in the area of the last known address of such member or other person giving notice of its intention to sell the shares; and

	(c)		during the relevant period and the period of three months following the publication of the advertisements referred to in paragraph (b) of this Article (or, if published on different dates, the first date) the Company has received no indication either of the whereabouts or of the existence of such member or person.

Further shares

216.

If during any relevant period referred to in Article 215, further shares have been issued in right of those held at the beginning of such period or of any previously issued during such period and all the other requirements of this Article and Articles 215 and 217 to 219 (other than the requirement that they be in issue for twelve years) have been satisfied in regard to the further shares, the Company may also sell the further shares.

Transfer on sale

217.

To give effect to any sale pursuant to Article 215 or 216, the board may:

	(a)		where the shares are held in certificated form, authorise any person to execute an instrument of transfer of the shares to, or in accordance with the directions of, the buyer; or

	(b)		where the shares are held in uncertificated form, do all acts and things it considers necessary or expedient to effect the transfer of the shares to, or in accordance with the directions of, the buyer.

Page 53

Effectiveness of transfer

218.

An instrument of transfer executed by that person in accordance with Article 217(a) shall be as effective as if it had been executed by the holder of, or person entitled by transmission to, the shares. An exercise by the Company of its powers in accordance with Article 217(b) shall be as effective as if exercised by the registered holder of or person entitled by transmission to the shares. The transferee shall not be bound to see to the application of the purchase money, and his title to the shares shall not be affected by any irregularity in, or invalidity of, the proceedings in reference to the sale.

Proceeds of sale

219.

The net proceeds of sale shall belong to the Company which shall be obliged to account to the former member or other person previously entitled as aforesaid for an amount equal to such proceeds. The Company shall enter the name of such former member or other person in the books of the Company as a creditor for such amount. No trust shall be created in respect of the debt, no interest shall be payable in respect of the same and the Company shall not be required to account for any money earned on the net proceeds of sale, which may be used in the Company’s business or invested in such a way as the board from time to time thinks fit.

WINDING UP

Liquidator may distribute in specie

220.

If the Company is wound up, the liquidator may, with the sanction of a special resolution of the Company and any other sanction required by the Insolvency Act 1986, divide among the members in specie the whole or any part of the assets of the Company and may, for that purpose, value any assets and determine how the division shall be carried out as between the members or different classes of members. The liquidator may, with the same sanction, vest the whole or any part of the assets in trustees for the benefit of the members and determine the scope and terms of these trusts, but no member shall be compelled to accept any asset upon which there is a liability.

Disposal of assets by liquidator

221.

The power of sale of a liquidator shall include a power to sell wholly or partially for shares or debentures or other obligations of another body corporate, either then already constituted or about to be constituted for the purpose of carrying out the sale.

SHARE WARRANTS

Share warrants to bearer

222.

The board may issue share warrants to bearer in respect of any fully paid shares under a seal of the Company or in any other manner authorised by the board. Any share while represented by such a warrant shall be transferable by delivery of the warrant relating to it. In any case in which a warrant is so issued, the board may provide for the payment of dividends or other moneys on the shares represented by the warrant by coupons or otherwise. The board may decide, either generally or in any particular case or cases, that any signature on a warrant may be applied by electronic or mechanical means or printed on it or that the warrant need not be signed by any person.

Conditions of issue of share warrants

223.

The board may determine, and from time to time vary, the conditions on which share warrants to bearer shall be issued and, in particular, the conditions on which:

Page 54

	(a)		a new warrant or coupon shall be issued in place of one worn-out, defaced, lost or destroyed (but no new warrant shall be issued unless the Company is satisfied beyond reasonable doubt that the original has been destroyed); or

	(b)		the bearer shall be entitled to attend and vote at general meetings; or

	(c)		a warrant may be surrendered and the name of the bearer entered in the register in respect of the shares specified in the warrant.

The bearer of such a warrant shall be subject to the conditions for the time being in force in relation to the warrant, whether made before or after the issue of the warrant. Subject to those conditions and to the provisions of the Companies Acts, the bearer shall be deemed to be a member of the Company and shall have the same rights and privileges as he would have if his name had been included in the register as the holder of the shares comprised in the warrant.

No right in relation to share

224.

The Company shall not be bound by or be compelled in any way to recognise any right in respect of the share represented by a share warrant other than the bearer’s absolute right to the warrant.

INDEMNITY

Indemnity to directors, officers, etc

225.

Subject to the provisions of the Companies Acts, but without prejudice to any indemnity to which the person concerned may otherwise be entitled, every director or other officer of the Company (other than any person (whether an officer or not) engaged by the Company as auditor) shall be indemnified out of the assets of the Company against any liability incurred by him for negligence, default, breach of duty or breach of trust in relation to the affairs of the Company, provided that this Article shall be deemed not to provide for, or entitle any such person to, indemnification to the extent that it would cause this Article, or any element of it, to be treated as void under the Act or otherwise under the Companies Acts.

Page 55

CONTENTS


	ARTICLE

Preliminary
Table A		1
Definitions		2
Construction		3

Accounts
Right to inspect records		195
Sending of annual accounts		196
Summary financial statements		197

Alteration Of Share Capital
New shares subject to these Articles		50
Fractions arising		51

Alternate Directors
Power to appoint alternates		118
Alternates entitled to receive notice		119
Alternates representing more than one director		120
Expenses and remuneration of alternates		121
Termination of appointment		122
Method of appointment and revocation		123
Alternate not an agent of appointer		124

Appointment And Retirement Of Directors
Number of directors to retire		109
Which directors to retire		110
When director deemed to be re-appointed		111
Eligibility for election		112
Separate resolutions on appointment		113
Additional powers of the Company		114
Appointment by board		115
Position of retiring directors		116
No share qualification		117

Borrowing Powers
Power to borrow		131
Borrowing limit		132
Definitions		133
Treatment of capital		134
Moneys borrowed		135
Subsidiaries		136

Page 56


	ARTICLE

Determining whether limit breached		137
Persons dealing with the Company		138

Calls On Shares
Power to make calls		25
Time when call made		26
Liability of joint holders		27
Interest payable		28
Deemed calls on allotment		29
Differentiation on calls		30
Payment of calls in advance		31

Capitalisation Of Profits And Reserves
Power to capitalise		193

Communications
When notice required to be in writing		198
Methods of Company sending notice		199
Methods of member etc. sending document or information		200
Notice to joint holders		201
Registered address outside EEA		202
Deemed receipt of notice		203
Terms and conditions for electronic communications		204
Notice to persons entitled by transmission		205
Transferees etc. bound by prior notice		206
Proof of sending/when notices etc. deemed sent by post		207
When notices etc. deemed sent by hand		208
Proof of sending/when notices etc. deemed sent by electronic means		209
When notices etc. deemed sent by website		210
Notice during disruption of services		211

Delegation Of Powers Of The Board
Committees of the board		127
Local boards, etc		128
Agents		129
Offices including title “director”		130

Destruction Of Documents
Power of Company to destroy documents		212
Presumption regarding destroyed documents		213
Early destruction		214

Directors’Expenses
Directors may be paid expenses		144

Directors’interests
Authorisation under s175 of the Act		148
Director may contract with the Company and hold other offices etc.		149
Remuneration, benefits etc.		150

Page 57


	ARTICLE

Notification of interests		151
Duty of confidentiality to another person		152
Consequences of authorisation		153
Without prejudice to equitable principles or rule of law		154

Disqualification And Removal Of Directors
Disqualification of a director		139
Power of Company to remove director		140

Dividends
Declaration of dividends		179
Interim dividends		180
Declaration and payment in different currencies		181
Apportionment of dividends		182
Dividends in specie		183
Scrip dividends: authorising resolution		184
Scrip dividends: procedures		185
Permitted deductions and retentions		186
Procedure for payment to holders and others entitled		187
Joint entitlement		188
Payment by post		189
Discharge to Company and risk		190
Interest not payable		191
Forfeiture of unclaimed dividends		192

Executive Directors
Appointment to executive office		145
Termination of appointment to executive office		146
Emoluments to be determined by the board		147

Forfeiture And Surrender
Notice requiring payment of call		32
Forfeiture for non-compliance		33
Sale of forfeited shares		34
Liability following forfeiture		35
Surrender		36
Extinction of rights		37
Evidence of forfeiture or surrender		38

General Meetings
Annual general meetings		52
Class meetings		53
Convening general meetings		54

Gratuities, Pensions And Insurance
Gratuities and pensions		155
Insurance		156
Directors not liable to account		157
Section 247 of the Act		158

Page 58


	ARTICLE

Indemnity
Indemnity to directors, officers, etc		225

Lien
Company to have lien on shares		21
Enforcement of lien by sale		22
Giving effect to sale		23
Application of proceeds		24

Minutes
Minutes required to be kept		171
Conclusiveness of minutes		172

Non-executive Directors
Arrangements with non-executive directors		141
Ordinary remuneration		142
Additional remuneration		143

Notice Of General Meetings
Period of notice		55
Recipients of notice		56
Uncontactable shareholders		57
Contents of notice — general		58
Contents of notice —additional requirements		59
Article 63 arrangements		60
General meetings at more than one place		61
Interruption or adjournment where facilities inadequate		62
Other arrangements for viewing and hearing proceedings		63
Controlling level of attendance		64
Change in place and/or time of meeting		65
Meaning of participate		66
Accidental omission to send notice etc		67
Security		68

Number Of Directors
Limits on number of directors		108

Powers Of The Board
Business to be managed by board		125
Exercise by Company of voting rights		126

Proceedings At General Meetings
Quorum		69
If quorum not present		70
Chairman		71
Directors entitled to speak		72
Adjournment: chairman’s powers		73
Adjournment: procedures		74

Page 59


	ARTICLE

Amendments to resolutions		75
Methods of voting		76
Declaration of result		77
Withdrawal of demand for poll		78
Conduct of poll		79
When poll to be taken		80
Notice of poll		81
Effectiveness of special resolutions		82

Proceedings of the board
Convening meetings and proceedings		159
Quorum		160
Powers of directors if number falls below minimum		161
Chairman and deputy chairman		162
Validity of acts of the board		163
Resolutions in writing		164
Meetings by telephone, etc		165
Directors’ power to vote on contracts in which they are interested		166
Shareholder approval		167
Division of proposals		168
Decision of chairman final and conclusive		169

Proxies And Corporate Representatives
Appointment of proxy: form		98
Execution of proxy		99
Proxies: other provision		100
Delivery/ receipt of proxy appointment		101
Authentication of proxy appointment not made by holder		102
Validity of proxy appointment		103
Rights of proxy		104
Vote by proxy		105
Corporate representatives		106
Revocation of authority		107

Record Dates
Record dates for dividends, etc		194

Registers
Overseas and local registers		177
Authentication and certification of copies and extracts		178

Secretary
Appointment and removal of secretary		170

Share Capital
Limited liability		4
Shares with special rights		5
Uncertificated shares		6
Not separate class of shares		7

Page 60


	ARTICLE

Exercise of Company’s entitlements in respect of uncertificated share		8
Allotment		9
Redeemable shares		10
Section 551 authority		11
Section 561 disapplication		12
Allotment after expiry		13
Definitions		14
Commissions		15
Trusts not recognised		16

Share Certificates
Members’ rights to certificates		19
Renewed certificates		20

Share Warrants
Share warrants to bearer		222
Conditions of issue of share warrants		223
No right in relation to share		224

The Seal
Authority required for use of seal		173
Certificates for shares and debentures		174
Official seal for use abroad		175
Execution of instrument as a deed under hand		175
Delivery of deeds		176

Transfer Of Shares
Form and execution of transfer of certified shares		39
Transfers of partly paid certificated shares		40
Invalid transfers of certificated shares		41
Transfers by recognised persons		42
Notice of refusal to register		43
No fee payable on registration		44
Retention of transfers		45

Transmission Of Shares
Transmission		46
Elections permitted		47
Elections required		48
Rights of persons entitled by transmission		49

Untraced Shareholders
Power to dispose of shares of untraced shareholders		215
Further shares		216
Transfer on sale		217
Effectiveness of transfer		218
Proceeds of sale		219

Variation of rights

Page 61


	ARTICLE

Method of varying rights		17
When rights deemed to be varied		18

Votes of Members
Right to vote on a show of hands		83
Right to vote on a poll		84
Votes of joint holders		85
Member under incapacity		86
Calls in arrears		87
Section 793 of the Act: restrictions if in default		88
Copy of notice to interested persons		89
When restrictions cease to have effect		90
Board may cancel restrictions		91
Conversion of uncertificated shares		92
Supplementary provisions		93
Section 794 of the Act		94
Errors in voting		95
Objection to voting		96
Voting: additional provisions		97

Winding up
Liquidator may distribute in specie		220
Disposal of assets by liquidator		221

Page 62

Exhibit 4.3

RULES OF THE REED ELSEVIER GROUP PLC
BONUS INVESTMENT PLAN 2010

(Approved by the shareholders of Reed Elsevier PLC
in general meeting on 21 April 2010)

(Approved by the shareholders of Reed Elsevier NV
in general meeting on 20 April 2010)

Adopted by the directors of Reed Elsevier Group plc on 21 April 2010

THE REED ELSEVIER GROUP PLC BONUS INVESTMENT PLAN 2010

1. Definitions

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

Adoption Date means 21 April 2010;

Capital Reorganisation means any variation in the share capital or reserves of a Qualifying Company (including without limitation, by way of capitalisation issue, rights issue, sub-division, consolidation or reduction);

Cash Investment means the proportion or amount of an Employee’s Investment Amount which he has chosen to source in cash;

Committee means the remuneration committee of the board of directors of the Company or other duly authorised committee;

Company means Reed Elsevier Group plc;

Control has the meaning given to it by section 995 Income Taxes Act 2007;

Date of Grant means the date on which a Matching Share Award is granted by the Committee under Rule 4.2;

Dealing Restrictions means any restrictions on, or requirement for, approvals for dealing in Shares whether under the Company’s, RE PLC’s or RE NV’s share dealing rules, the provisions of the Model Code for Securities Transactions by Directors of Listed Companies, the provisions of the Listing Rules of the UK Listing Authority or the City Code on Takeovers and Mergers or any of their equivalents in any applicable jurisdiction;

Dividend Equivalent means a right to a cash payment or Shares in accordance with Rule 7;

Dutch ADS means an American Depositary Share representing a Dutch Share;

Dutch Share means an ordinary share in the capital of RE NV or any other shares representing those shares following any Capital Reorganisation;

Employee means any employee or executive director of any member of the Group or a Qualifying Company;

Existing Shares means, unless the Committee specifies otherwise in an Invitation, any Shares which are beneficially owned by a Participant, excluding any Shares which the Participant holds as Personal Shares under the Reed Elsevier Group plc Growth Plan;

Gross Investment Amount means the Investment Amount prior to the deduction of income tax and employee’s social security contributions;

Group means the Company and every company which is under the Control of the Company, and member of the Group will be construed accordingly;

Page 1

Investment Amount means the percentage or amount of his Investment Opportunity which a Participant invests in the Plan in accordance with Rule 3.3(a);

Investment Date means such date as is specified by the Committee in an Invitation for the purchase of Investment Shares or, if Dealing Restrictions are in place on that date, such later date when the Dealing Restrictions lift;

Investment Opportunity means an amount equal to an Employee’s net target bonus opportunity as at the 31 December preceding the Date of Grant under an annual bonus scheme operated by any member of the Group, or such lesser amount determined on any other basis as the Committee may specify from time to time;

Investment Period means the period specified in Rule 5.4(b);

Investment Shares means Shares held by a Participant in this Plan in accordance with Rules 3.4 to 3.6 of this Plan;

Invitation means an invitation to participate in the Plan issued to an Employee by the Committee in accordance with Rule 3.2;

Matching Share Award means, unless Schedule 5 applies, a right granted under Rule 4 to receive Shares without payment and references to Matching Shares will be construed accordingly;

Participant means any individual who holds a subsisting Matching Share Award (including where the context permits, the legal personal representatives of a deceased Participant);

Performance Period means the period, as specified in Rule 5.4(c) after which the Performance Target is measured;

Performance Target means, unless the Committee determines otherwise at the Date of Grant, the conditions set out in Schedule 1 and measured after the end of the Performance Period applicable to Matching Share Awards;

Plan means this Reed Elsevier Group plc Bonus Investment Plan 2010 as amended from time to time;

Price means the price or the mean average of the prices, as applicable, at which Investment Shares are purchased pursuant to Rule 3.4;

Qualifying Company means each of RE PLC and RE NV;

RE NV means Reed Elsevier NV;

RE PLC means Reed Elsevier PLC;

Rules means the rules of the Plan;

Share means a UK Share, a Dutch Share, a UK ADS and a Dutch ADS and Shareholder will be construed accordingly;

Termination Date means the date on which a Participant ceases to be an Employee;

Page 2

UK ADS means an American Depositary Share representing a UK Share;

UK Share means an ordinary share in the capital of RE PLC or any other shares representing those shares following any Capital Reorganisation;

Normal Vesting Date means the date, following the end of the Performance Period, on which the Committee determines the extent to which the Performance Target has been satisfied or, if there are Dealing Restrictions in place on that date, such later date when those Dealing Restrictions lift;

Vesting means the Participant becoming absolutely entitled to receive the Shares comprised in his Matching Share Award in accordance with these Rules and Vest and Vested will be construed accordingly.

1.2 References to any statute or statutory instrument or to any part or parts thereof include any modification, amendment or re-enactment thereof for the time being in force.

1.3 Words of the masculine gender will include the feminine and vice versa and words in the singular will include the plural and vice versa unless in either case the context otherwise requires or is otherwise stated.

1.4 The Committee may establish additional schedules to the Plan for the benefit of employees outside the UK, based on the Plan but modified to take account of local tax, exchange control or securities laws in overseas territories.

2. Eligibility

Employees are eligible to participate in the Plan as selected by the Committee. Employees under notice of termination of employment at the Date of Grant are not eligible to participate, unless the Committee determines otherwise.

3. Investment Shares

Investment Opportunity

3.1 The Committee may invite selected Employees to invest a specified percentage, up to a maximum of 100%, of their Investment Opportunity (or such lesser amount as specified by the Committee from time to time) in Investment Shares in accordance with the terms of this Plan.

Invitation to Participate

3.2 Following the notification of the amount of any annual bonus payable to the Employee for any financial year, Invitations to participate in the Plan will be sent to selected Employees. The Invitation will specify:

(a)

the Investment Opportunity;

(b)

the maximum percentage of the Investment Opportunity which the Employee may invest in the Plan;

Page 3

(c)

the minimum percentage of the Investment Opportunity which the Employee may invest in the Plan and any applicable multiples of that minimum percentage;

(d)

the sources which an Employee may use to invest in the Plan, which will be any or all of the following as determined by the Committee: net annual bonus received in respect of the financial year preceding the Invitation, any other cash funds available to the Employee and Existing Shares;

(e)

the date by which the Employee must accept his Invitation in order to participate in the Plan;

(f)

the date or dates by which and the person to whom the Employee must transfer his Investment Amount in order to be able to participate in the Plan;

(g)

the Investment Date;

(h)

the method by which the number of Shares subject to a Matching Share Award is calculated and the Performance Target; and

(i)

such other information as the Committee may determine.

Requirements for acceptance of an Invitation

3.3 When accepting an Invitation, an Employee will:

(a)		specify his chosen Investment Amount;

(b)		to the extent that the Invitation allowed more than one source for the Investment Amount, specify the percentage of his Investment Amount which he wishes to contribute by reference to each source;

(c)		to the extent that the Investment Amount comprises a Cash Investment, agree to pay directly or, if appropriate, direct his employing company to pay, that amount to the Company (or such other person as the Committee may specify) by the specified date;

(d)		to the extent that the Investment Amount comprises Existing Shares, agree to transfer the required number of Existing Shares (to such person as the Committee may specify) by the specified date, or to take any alternative action with regard to such Existing Shares as determined by the Committee;

(e)		specify the proportion of UK Shares, Dutch Shares, UK ADSs, and Dutch ADSs (i) which should comprise the Investment Shares to be acquired with the Cash Investment on the Investment Date and/or (ii) which will comprise the Existing Shares being transferred;

(f)		agree to comply with such arrangements for the holding of the Investment Shares as the Committee may determine appropriate;

(g)		agree that he will execute such tax elections as the Committee may consider necessary or desirable including without limitation an election under section 431 Income Tax (Earnings and Pensions) Act 2003;

Page 4

(h)		agree that he will comply with such other conditions as the Committee may specify as a condition of grant of a Matching Share Award; and

(i)		complete any other aspects of the Invitation as required.

Purchase of Investment Shares

3.4 Subject to the Company (or such other person as the Committee specified) having received the Participant’s Cash Investment by the specified date, the Committee will arrange to purchase, on the Investment Date, the number of Shares (of the type specified by the Employee in his completed Invitation) which can be purchased with the Participant’s Cash Investment. However, if it is not reasonably practicable to make the required purchases of Shares on behalf of all Employees participating in the Plan on the Investment Date, then the Shares will be purchased over a number of dealing days and each Participant will be treated as having acquired his Investment Shares at the mean average of the prices at which all such Shares were purchased. A Participant will have no entitlement to be repaid any part of the Cash Investment which is insufficient to purchase a whole Share.

3.5 A Participant’s total number of Investment Shares will be the aggregate of (i) the nearest whole number of Shares that are acquired pursuant to Rule 3.4 with the Cash Investment provided by the Employee and (ii) the Existing Shares which the Employee elected to commit to the Plan pursuant to Rule 3.3(d) above, which are transferred into the Plan by the specified date and which are deemed to be invested in the Plan at the Price. A Participant will be notified of his total number of Investment Shares.

3.6 If an Employee makes an election under Rule 3.3 but (i) that election is made after the date specified in the Invitation or (ii) he fails to provide funds to enable the Investment Shares to be purchased by the specified date, the Committee will not be required to proceed with granting a Matching Share Award but may in its absolute discretion decide to do so, subject to the Rules of this Plan, provided that the Investment Shares will then be purchased at the price prevailing on the dealing day on which the Investment Shares are actually purchased and the Shares to be comprised in the Matching Share Award will be calculated accordingly.

Retention of Investment Shares

3.7 A Participant’s Investment Shares must, except to the extent expressly provided otherwise by these Rules, continue to be held under the Plan until the date of Vesting of the related Matching Share Award.

3.8 During the Investment Period, the Participant will not sell, transfer, pledge, assign or otherwise dispose of all or any Investment Shares, nor request the transfer of such Investment Shares to himself (provided that the Committee may in its absolute discretion allow such actions or release the Investment Shares to the Participant if it considers that exceptional circumstances exist, in which case the Committee will determine the extent to which the related Matching Share Award will be scaled back, if at all, and in what manner). Any such action or attempt at such action by the Participant (without consent) will result in the automatic lapse of the Matching Share Award.

3.9 At the end of the Investment Period, the Participant’s Investment Shares will be released to him as soon as reasonably practicable.

Page 5

Beneficial ownership of Investment Shares

3.10 The beneficial interest in the Investment Shares, to the extent not already held by the Participant will pass to the Participant on the Investment Date or the date upon which they are otherwise purchased pursuant to Rules 3.4 or 3.6. During the Investment Period, the Participant will be entitled to receive all dividends payable in respect of the Investment Shares and will have the rights commonly enjoyed by a beneficial owner of Shares provided that any voting rights will be exercisable by a direction in writing given to the trustee or other nominee in whose name the Investment Shares are registered. The Participant will have no corresponding rights in respect of the Shares in the Matching Share Award prior to Vesting.

4. Grant of Matching Share Awards

Number of Shares comprised in a Matching Share Award

4.1 On the Investment Date, the Committee will grant a Matching Share Award to an Employee who has committed Investment Shares to the Plan. Except as otherwise provided in these Rules, the number of Shares comprised in the Matching Share Award will be the nearest whole number of Shares which can be acquired at the Price with the Participant’s Gross Investment Amount. The Matching Share Award will include UK Shares, Dutch Shares, UK ADSs and Dutch ADSs in the same proportions as those comprised in the Investment Shares. If an Employee has committed to transfer Existing Shares into the Plan to make up part or all of his Investment Amount, and then fails to transfer the required value of Existing Shares by the specified date, any Matching Share Award already granted to him will immediately lapse in whole or in part as determined by the Committee.

Timing of grant of Matching Share Award

4.2 A Matching Share Award will normally be granted by the Committee within the period of 42 days commencing on:

(a)		in respect of the grant of Matching Share Awards in 2010, the day immediately following the day on which the Plan was approved by RE PLC in general meeting and by RE NV in general meeting;

(b)		the date on which a Qualifying Company makes an announcement of its results for the full year, the half year or any other interim results or trading update; and

(c)		any other date when the Committee resolves that exceptional circumstances exist which justify the grant of a Matching Share Award,

If Dealing Restrictions remain in force during such period (or for such longer period as the Committee thinks fit) the Committee will either:

	(i)		invite the Employee to reconsider whether he wishes to elect to participate in the Plan; or

	(ii)		withdraw the Invitation.

Page 6

5. Terms of Matching Share Awards

5.1 The grant of a Matching Share Award is conditional upon a Participant agreeing to comply with any arrangements specified by the Company for the payment of tax and social security contributions in respect of Shares to which he is or may become entitled under the Plan including, without limitation (i) the right to sell on the Participant’s behalf sufficient Shares to satisfy any tax or social security contributions liability on his part for which any member of the Group may be liable and (ii) entering into any election under Chapter 2 of Part 7 of the Income Tax (Earnings & Pensions) Act 2003 specified by the Company.

5.2 Matching Share Awards will be granted on the basis that they only Vest to the extent that the Performance Target has been satisfied.

5.3 The Committee may make the grant of Matching Share Awards subject to any other conditions it determines appropriate including requiring a Participant to agree to comply with certain post-employment restrictive covenants.

5.4 Matching Share Awards will be granted by deed. Each Participant will receive information (electronically or in hard copy) following the Date of Grant summarising the main terms of the Matching Share Award. This summary may include the following information:

(a)		The Number of Shares — number of Investment Shares and number of Shares comprised in the Matching Share Award and in what proportion they comprise UK Shares, Dutch Shares, UK ADSs and/or Dutch ADSs.

(b)		The Investment Period — The Investment Period will commence on the Investment Date and will expire on the earlier of the Normal Vesting Date or other date of Vesting under these Rules .

(c)		The Performance Period — The Performance Period will be the period of three consecutive financial years commencing with the financial year in which the Date of Grant falls.

(d)		Details of the Performance Target applicable to Matching Share Awards.

(e)		The terms of any other conditions imposed pursuant to rules 5.1 and 5.3.

(f)		Which (if any) Schedules to the Plan apply to the Matching Share Award.

6. Normal Vesting of Matching Share Awards

6.1 Except as otherwise provided in these Rules, the number of Matching Shares which Vest on the Normal Vesting Date will be determined by the Committee following the expiry of the Performance Period by reference to the extent to which the Performance Target has been satisfied and any other conditions to which the Matching Share Award is subject are fulfilled or waived. A Matching Share Award will lapse on the Normal Vesting Date to the extent that it does not Vest.

6.2 The Investment Shares together with the Vested Matching Shares will be released to the Participant as soon as reasonably practicable following the Normal Vesting Date along with the Dividend Equivalent.

Page 7

7. Entitlement to Dividend Equivalents

7.1 In addition to any Shares which a Participant becomes entitled to on the Vesting of a Matching Share Award, the Participant will, subject to Rule 7.3, also be entitled to a cash payment equal in value to the ordinary dividends (excluding any associated tax credit) which would have been paid on the Vested Matching Shares during the period commencing at the start of the Performance Period and ending on the earlier of (i) the end of the Performance Period and (ii) the Vesting of the Matching Share Award.

7.2 The cash payment to which the Participant becomes entitled under Rule 7.1:

(a)		will be calculated (in such manner as the Committee sees fit) by reference to the currency payment of the underlying dividend (and paid in such currency as the Committee sees fit);

(b)		will be calculated without any entitlement to interest (or other type of investment return) in the period between the dividend payment date and Vesting;

(c)		will be paid (subject to such deductions as are required by law) within one month of Vesting; and

(d)		will be calculated by reference to ordinary dividends and without regard to special dividends or distributions or dividends-in-specie;

7.3 Instead of making a cash payment, the Committee may in its discretion satisfy any entitlement to Dividend Equivalents arising in accordance with Rule 7.1 by transferring existing Shares with an equivalent value (as determined at the time of Vesting).

7.4 For the avoidance of doubt, any payment referred to in this Rule 7 does not represent an entitlement to actual dividends on the underlying Shares, by reason of the Participant not being beneficial owner of the Shares at that time.

8. Termination of Employment

Participant gives or receives notice

8.1 Except as otherwise provided in these Rules, in the event that a Participant gives or receives notice of termination of employment for any reason other than those set out in Rules 8.2 and 8.4, a Matching Share Award will automatically lapse on the date on which notice is given or received. The Participant’s Investment Shares will be released to him as soon as reasonably practicable after the date of notice.

Approved Leaver

8.2 Except as otherwise provided in these Rules, in the event that the Participant ceases to be an Employee during the Investment Period by reason of:

(a)		redundancy (as defined in section 139 of the Employment Rights Act 1996);

(b)		retirement with the consent of the Company;

Page 8

(c)		the sale of the company or business in which the Participant is employed out of the Group; or

(d)		any other reason the Committee, in its absolute discretion, determines:

	(i)		the Matching Share Award will continue in force over a Pro-rated Number of Shares until the end of the Investment Period and will lapse as to the balance on the Termination Date. The Matching Share Award will Vest on the Normal Vesting Date in accordance with Rule 6; and

	(ii)		the Participant will be required to retain a Pro-rated Number of Investment Shares in the Plan until the end of the Investment Period, at which time those Shares will be released to the Participant. The balance of the Investment Shares will be released to the Participant as soon as reasonably practicable following the Termination Date.

8.3 The Committee has discretion to vary the application of Rule 8.2 and determine that a Participant’s Matching Share Award and Investment Shares should be treated as set out in Rule 8.4 instead.

Death, Injury, Disability and Ill-health.

8.4 Save as otherwise provided in these Rules, in the event that the Participant ceases to be an Employee during the Investment Period:

(a)

by reason of death, injury, disability or ill-health:

	(i)		the Shares comprised in a Matching Share Award will Vest over a Pro-rated Number of Shares subject to performance. The Performance Target will be assessed based on progress made against targets at the Termination Date as determined at the Committee’s absolute discretion. Such determination will take place as soon as practicable after the Termination Date and to the extent that the Matching Share Award does not Vest on the date of determination, it will immediately lapse; and

	(ii)		the Investment Shares will be released in full to the Participant or his personal representatives (as applicable) as soon as reasonably practicable following the Termination Date.

8.5 The Committee has discretion to vary the application of Rule 8.4 and determine that:

(a)

a Participant’s Matching Share Award and Investment Shares should be treated as set out in Rule 8.2 instead; or

(b)

the Performance Target will be waived and/or Shares comprised in a Matching Share Award will Vest in full on the Termination Date and the Investment Shares will be released in full to the Participant or his personal representatives (as applicable) as soon as reasonably practicable following the Termination Date.

Page 9

8.6 For the purposes of this Rule 8, the Pro-rated Number will be such number of Shares as is determined by multiplying the number of Investment Shares or Shares comprised in a Matching Share Award (as applicable) by A/B where A is the number of complete calendar months which the Participant was employed during the Performance Period and B is 36.

9. Claw-Back Arrangements

Breach of Restrictive Covenants

9.1 If a Participant breaches any term of his post-termination restrictive covenants (such breach to be determined by the Committee acting fairly and reasonably), any unvested Matching Share Awards will lapse on the date of the Committee’s determination and the Committee may require him to pay to the Company or any other member of the Group, within seven days of written demand from the Company, the Relevant Amount (as defined in Rule 9.2 below).

9.2 The Relevant Amount is an amount equal to A minus both B and C where:

A is an amount equal to the pre-tax gain realised by the Participant in respect of any Matching Share Awards and Dividends Equivalents in the period beginning six months before the Termination Date and ending when the Participant’s restrictive covenants cease to apply. For these purposes, the gain will be the sum of the market value of the Vested Shares when received by the Participant and the related Dividend Equivalents, and such gain will be determined irrespective of whether the Participant has sold or retained the Shares so acquired;

B is an amount equal to the tax and social security charges and liabilities incurred by the Participant in respect of A ; and

C is any payment of the Claw-back Amount, determined in accordance with Rule 9.4, in respect of A .

Materially misstated financial or other data

9.3 If the Committee, within two years after the Vesting of a Matching Share Award, considers that the Vesting of the Matching Share Award and/or the payment of Dividend Equivalents was determined on the basis of materially misstated financial or other data (the Incorrect Award), it will, unless it determines otherwise, recover the Claw-back Amount (as defined in Rule 9.4 below) by taking one or more of the following actions:

(a)		reduce any outstanding unvested Matching Share Awards by the Claw-back Amount; and/or

(b)		reduce any future Matching Share Awards by the Claw-back Amount; and/or

(c)		require the Participant to pay to the Company, within thirty days of a written demand from the Company, the Claw-back Amount.

9.4 The Claw-back Amount will be the difference between (i) the Incorrect Award and (ii) the Matching Share Award and Dividend Equivalents that would have Vested or been payable had the correct data, as determined by the Committee acting fairly and reasonably, been used. This may be expressed as a number of Shares or

Page 10

a monetary amount or a combination thereof as the Committee considers appropriate. In determining the Claw-back Amount, the Committee may take into account such matters as it sees fit including, but not limited to:

(a)		the difference between the Incorrect Award and the correct Matching Share Award;

(b)		any gain made by the Participant on the sale of Shares comprised in the Matching Share Award;

(c)		any tax and/or dealing costs incurred by the Participant in connection with the Incorrect Award, and

(d)		whether the Participant has made a payment pursuant to Rules 9.1 to 9.2 which would take account of Shares subject to an Incorrect Award.

9.5 By accepting a Matching Share Award, a Participant will be bound by this Rule 9 notwithstanding (i) that it may only be applicable after the release of Shares under these Rules and (ii) whether or not the essential terms of this Rule 9 have been separately notified to each Participant.

10. Change of Control of a Qualifying Company

10.1 Except as otherwise provided in these Rules, if any person:

(a)		obtains Control of a Qualifying Company as a result of making an offer to acquire Shares which is either unconditional or is made on a condition such that if it is satisfied the person making the offer will have Control of that Qualifying Company;

(b)		becomes bound or entitled to acquire Shares under sections 979 and 983 of the Companies Act 2006 (or in relation to RE NV becomes entitled to acquire compulsorily Shares held by minority shareholders); or

(c)		obtains Control of a Qualifying Company in pursuance of a compromise or arrangement sanctioned by the Court under section 899 of the Companies Act 2006 (or in relation to RE NV under any equivalent legislative provision in the Netherlands),

then any unvested Matching Share Awards over Shares in that Qualifying Company (but not those in the other Qualifying Company) will Vest in respect of the Pro-rated Number within 30 days of the relevant event, subject to the Performance Target. The Performance Target will be assessed based on progress made against targets as at the date of the relevant event as determined by the Committee in its absolute discretion.

10.2 Any Matching Share Award over Shares in that Qualifying Company which do not Vest as a result of the relevant event will lapse on the relevant event.

10.3 The Investment Shares in that Qualifying Company (but not those in the other Qualifying Company) will be released as soon as reasonably practicable after the date of the relevant event.

Page 11

10.4 For the purposes of this Rule 10, the Pro-rated Number will be such number of Shares as is determined by multiplying the number of Shares comprised in a Matching Share Award by A/B where A is the number of complete calendar months between the start of the Performance Period and the relevant event (but cannot exceed 36) and B is 36.

11. Change of Control of the Company

Except as otherwise provided in these Rules, the provisions of Rule 10 will apply with any necessary changes in the event that any person (either alone or together with any person acting in concert with him) obtains Control of the Company and the Shares comprised in Matching Share Awards which may Vest, and the Investment Shares which may be released, as a result of the relevant event will be Shares in both Qualifying Companies.

12. Internal Reorganisation

12.1 Rules 10 and 11 will not apply if the purpose and effect of the change of Control or scheme of arrangement is:

(a)		to create a new holding company for the relevant Qualifying Company, such company having substantially the same Shareholders and proportionate shareholdings as those of the Qualifying Company immediately prior to the scheme of arrangement;

(b)		to give one Qualifying Company Control (directly or indirectly) of the other Qualifying Company;

(c)		the person obtaining Control of the Company is one of the Qualifying Companies or a company under the Control of one or both of them; or

(d)		the Company remains under the ultimate Control of the Shareholders of the Qualifying Companies immediately prior to the relevant transaction affecting the Company.

12.2 If Rule 12.1 applies:

(a)		Matching Share Awards will not Vest and Investment Shares will not be released as a result of the relevant event;

(b)		a Matching Share Award will instead be exchanged for an equivalent award over such shares as the Committee determines appropriate;

(c)		Investment Shares will instead be exchanged for shares or cash and continue to be subject to the Plan on such terms as the Committee determines appropriate; and

(d)		the Committee may make any modifications to the Performance Target as it determines appropriate.

12.3 The Committee may vary the application of this Rule 12 so that it applies to Matching Share Awards and Investment Shares over Shares in both Qualifying Companies or to Shares in only one Qualifying Company.

Page 12

12.4 Where Rule 12 applies, a Participant will not be treated as ceasing to be an Employee until he ceases to be employed by a company which is either the relevant holding company or a subsidiary of the holding company (within the meaning of section 1159 of the Companies Act 2006).

13. Rollover on a Change of Control

13.1 The Committee may determine that Rules 10 or 11 will not apply on a change of Control of a Qualifying Company or the Company (as applicable) and may, with the consent of the person obtaining Control, (i) determine that the Matching Share Awards will be rolled over in accordance with either the provisions of Rule 12.2 or Rule 13.2 or (ii) allow the Participants to choose between Vesting under Rules 10 or 11 as applicable and rollover in accordance with, as determined by the Committee, Rule 12.2 or Rule 13.2.

13.2 The Committee can determine that Matching Share Awards are rolled over in accordance with the following terms:-

(a)		the Performance Target will be assessed based on progress made against targets as at the date of the relevant event as determined by the Committee in its absolute discretion;

(b)		to the extent that the Performance Target has been met, a Matching Share Award will be exchanged for an equivalent award over such shares as agreed between the Committee and the person obtaining Control, and will Vest on the Normal Vesting Date subject to the Participant remaining in employment within the acquirer group of companies (unless Rules 8.2 to 8.6 apply) and will be subject to the Rules as they last had effect in relation to the Matching Share Award that was rolled-over;

(c)		to the extent that the Performance Target has not been met, the Matching Share Award will immediately lapse; and

(d)		the Committee may specify such requirements in relation to the Investment Shares as it determines appropriate.

13.3 For the avoidance of doubt, in Rules 10, 11, 12 and 13, “ Committee ” means those people who were members of the Committee immediately before the event by virtue of which the applicable Rule applies.

14. Voluntary winding up

The provisions of Rule 10 will apply with any necessary changes in the event that notice is duly given of a resolution for a voluntary winding up of a Qualifying Company provided that , all references in that Rule to the date of the relevant event will be treated as references to the date on which notice is given for the voluntary winding-up of a Qualifying Company.

15. Adjustments

15.1 In the event of:

(i)

any Capital Reorganisation; or

Page 13

(ii)

the implementation by a Qualifying Company of a demerger or the payment by a Qualifying Company of a super-dividend which would otherwise materially affect the value of a Matching Share Award;

(a)		the number of Shares comprised in the Participant’s Matching Share Award will be adjusted in such manner as the Committee, in its absolute discretion, thinks fit; and

(b)		a Participant will in respect of his Investment Shares be treated in the same manner as any other holder of Shares, except that (unless the Committee determines otherwise):

	(i)		in the event of a rights issue in respect of Investment Shares, the Participant (or other nominee holding Investment Shares on his behalf) will be required to sell sufficient rights nil-paid (at such time during the rights issue as the Committee thinks fit) as will enable the Participant to acquire with the proceeds of sale the remainder of the Participant’s rights entitlement PROVIDED THAT the Participant may elect to take up in a personal capacity the rights that would have been sold (and such Shares will not be subject to this Plan) subject to the Participant providing sufficient funds to give effect to his obligation under the first part of this sub-paragraph (i);

	(ii)		in the event of receipt of cash (other than dividends paid in the normal course) or securities (other than Shares) in respect of Shares (on a demerger or other reorganisation of the share capital of a Qualifying Company), the Committee will in its absolute discretion determine whether such cash or securities will be released to the Participant or whether the nominee holding Shares on behalf of the Participant will be required to apply that cash (or the proceeds of sale of such securities), after allowing for tax thereon, in the purchase of further Investment Shares to be held on behalf of the Participant.

16. Source of Shares

Shares required to satisfy the rights of Participants with respect to Investment Shares and Matching Share Awards will be from purchases on a recognised stock exchange. No new Shares will be issued or Shares transferred out of treasury in connection with the Plan.

17. Rights attaching to shares transferred pursuant to Matching Share Awards

17.1 All Shares transferred upon the Vesting of a Matching Share Award will rank pari passu in all respects with the Shares in issue at the date of Vesting save as regards any rights attaching to such Shares by reference to a record date prior to the date of Vesting.

17.2 Any Shares acquired on the Vesting of Matching Share Awards will be subject to the articles of association of the relevant Qualifying Company from time to time.

Page 14

18. Administration and Amendment

18.1 The decision of the Committee will be final and binding in all matters relating to the Plan including the exercise of any discretion under the Plan, the interpretation of the Plan and any dispute relating to any matter in connection with the Plan.

18.2 The Committee may at any time discontinue the grant of further Matching Share Awards or amend any of the provisions of the Plan in any way it thinks fit and such changes may affect Matching Share Awards already granted, provided that:

(a)		the Committee will not make any amendment that would materially prejudice the interests of existing Participants except with their prior consent; and

(b)		no amendment which in the reasonable opinion of the Committee is to the advantage of Employees or Participants may be made to:

	(i)		the definition of Employee ;

	(ii)		the maximum entitlement of a Participant under the Plan;

	(iii)		the maximum limit on the number of Shares which can be awarded under the Plan;

	(iv)		the basis for determining a Participant’s entitlement to Shares under the Plan and the terms on which Shares can be acquired;

	(v)		the terms of Shares to be provided under the Plan;

	(vi)		the adjustment provisions in Rule 15 of the Plan;

without the prior approval of the RE PLC (and if appropriate RE NV) in general meeting (aa) except in the case of minor amendments to benefit the administration of the Plan, to take account of a change in legislation, to obtain or maintain favourable tax, exchange control or regulatory treatment for Participants or any member of the Group, or (bb) as otherwise permitted under these Rules; and

(c)

without prejudice to any provision of the Plan which provides for the lapse of a Matching Share Award, the Committee may not cancel a Matching Share Award unless the Participant agrees in writing to such cancellation.

19. General

Trustee Funding

19.1 Any member of the Group may provide money for the purpose of acquiring Shares to satisfy Matching Share Awards (and will if requested to do so by the Committee) before the date specified by the Committee for purchase of Shares comprised in Matching Share Awards. The Company will be under no obligation to purchase the Shares comprised in a Matching Share Award at or around the Date of Grant but will procure that there are sufficient Shares available for transfer to satisfy a Matching Share Award by the date of Vesting.

Discretionary Nature of the Plan

Page 15

19.2 The rights and obligations of a Participant under the terms and conditions of his office or employment will not be affected by his participation in the Plan or any right he may have to participate in the Plan.

19.3 Participation in the Plan does not imply any rights to receive Matching Share Awards on the same or any other basis in any other year.

19.4 The terms of the Plan do not entitle the Participant to the exercise of any discretion in his favour.

19.5 Each Participant waives all and any rights to compensation or damages in consequence of the termination of his office or employment with any member of the Group for any reason whatsoever (whether such cessation is lawful or unlawful) insofar as those rights arise or may arise from his ceasing to have rights or be entitled to Shares hereunder as a result of such termination or from the loss or diminution in value of such rights or entitlements. If necessary, the Participant’s terms of employment will be varied accordingly.

Changes to a Qualifying Company’s capital structure

19.6 The existence of any Matching Share Award will not affect in any way the right or power of the Company, or the Qualifying Companies or their shareholders to make or authorise any or all adjustments, recapitalisations, reorganisations or other changes in the Company’s or either of the Qualifying Company’s capital structure, or any merger or consolidation of the Company or Qualifying Companies, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or Qualifying Companies or any sale or transfer of all or any part of their assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

Notices

19.7 Any notice or other document required to be given to a Participant under or in connection with the Plan may be delivered or sent by post to him at his home address according to the records of his employing company or sent by email or fax to any email address or fax number according to the records of his employing company or, in either case, such other address as may appear to the Company to be appropriate.

19.8 Notices sent by post to a Participant in the UK or US will be deemed to have been given two days after the date of posting. However, notices sent to a Participant in other countries will be deemed to have been given on the seventh day after the date of posting.

19.9 Notices sent by email or fax, in the absence of evidence to the contrary, will be deemed to have been received on the day following sending.

19.10 Any notice or other document required to be given to the Company under or in connection with the Plan may be delivered or sent by post to it at its registered office (or such other place or places as the Committee may from time to time determine and notify to Participants) or sent by email or fax to any email address or fax number notified to the sender.

Page 16

19.11 All Share certificates and other communications relating to the Plan will be sent at the Participant’s risk.

No transfer of Matching Share Awards

19.12 A Participant may not transfer, assign, charge or otherwise dispose of Matching Share Awards, or any rights in respect of them, except on the transmission of Matching Share Awards on the death of a Participant to his personal representatives or the assignment of a Matching Share Award, with the prior consent of the Committee, subject to any terms and conditions the Committee imposes. Any such attempted transfer will result in the lapse of the Matching Share Award.

Awards Non-Pensionable

19.13 Matching Share Awards and Dividend Equivalents under the Plan are not pensionable.

Taxation

19.14 Any liability of a Participant to taxation in respect of Investment Shares or a Matching Share Award will be for the account of the relevant Participant. By accepting a Matching Share Award, a Participant agrees to comply with any arrangements specified by the Company for the payment of taxation (including, without limitation, arranging the sale of sufficient Shares to enable the Company or any member of the Group to satisfy its obligations in respect of deduction of taxation at source) and to enter into any election specified by the Company under Chapter 2 of Part 7 of the Income Tax (Employment & Pensions) Act 2003 in respect of shares to which he is or may become entitled under the Plan.

Stamp Duty

19.15 The Participant will bear all dealing costs and stamp duty relating to the purchase of Investment Shares under the Plan. The Company will bear all dealing costs and stamp duty relating to the purchase and release of Shares in respect of a Matching Share Award under the Plan.

Expiry of Plan

19.16 No Matching Share Award will be granted under the Plan later than the tenth anniversary of the Adoption Date.

Data Protection

19.17 By accepting the grant of a Matching Share Award, a Participant consents to the holding and processing of personal data provided by him to the Company, a Qualifying Company or any member of the Group, and any other persons for all purposes related to the operation of the Plan and acknowledges that the personal information may be transferred to, and stored at, a destination outside the European Economic Area (“EEA”), and may also be processed by staff operating outside the EEA who work for the Company, a Qualifying Company, a member of the Group or for one of their service providers. The Company will take all steps reasonably necessary to ensure that a Participant’s personal data is treated securely under appropriate contractual arrangements.

Page 17

Governing Law

19.18 These Rules will be governed by and construed in accordance with English law.

Page 18

SCHEDULE 1

Performance Target

General

1. The following provisions shall apply to Matching Share Awards granted under the Plan, unless the Committee determines otherwise at the Date of Grant in respect of any Matching Share Award.

2. Except as otherwise provided for in the Rules, the Performance Targets applicable to Matching Share Awards will be measured after the end of the Performance Period for such Matching Share Award.

3. There are two separate measures of equal weighting: a Return on Invested Capital measure ( ROIC Measure ) and an Adjusted Earnings per Share measure ( EPS Measure ).

4. To the extent that the Performance Target is not satisfied, Matching Share Awards will lapse.

The ROIC Measure

5.1 The Vesting of one half of the Matching Share Award relates to the percentage return on invested capital of the combined businesses of the Qualifying Companies. Vesting relates to the percentage ROIC for the last financial year of the relevant Performance Period. The portion of a Matching Share Award subject to the ROIC Measure is referred to as the ‘ ROIC Tranche ’.

5.2 With respect to Matching Share Awards granted in 2010, for any part of the ROIC Tranche to Vest, the percentage ROIC for financial year 2012 must exceed the percentage ROIC for financial year 2009, calculated on the same basis.

5.3 The following definitions are relevant for ROIC:

	(i)		Invested capital = arithmetic average of the opening and closing capital employed stated before financing and tax balances for the combined businesses of the Qualifying Companies adjusted for major acquisition timing for the financial year with all cumulative amortisation and impairment charges for acquired intangible assets and goodwill added back and excluding the gross up to goodwill in respect of deferred tax liabilities established on the acquisition of intangible assets retranslated at the average and hedge exchange rates applicable to the financial year before the start of the Performance Period. In addition, any exceptional restructuring and acquisition related charges (net of tax) over the Performance Period are capitalised for these purposes and the effect of changes in exchange rates and movements in the net pension deficits are excluded.

	(ii)		Return = adjusted operating profit for the combined businesses of the Qualifying Companies before amortisation and impairment of acquired intangible assets and goodwill, exceptional restructuring and acquisition related charges and grossed up to exclude the equity share of taxes in

Page 19

joint ventures and further adjusted to exclude movements in the net pension financing credit, after applying the effective rate of tax used for adjusted earnings calculations and using exchange rates to match those used in the calculation of invested capital.

In order to ensure that the performance score achieved is a fair reflection of underlying business performance, the Committee retains discretion to determine the treatment of major disposals and acquisitions that require board approval. Any significant adjustments made to the final performance score will be disclosed to shareholders.

5.4 The number of Matching Shares comprised in the ROIC Tranche which is capable of Vesting will be determined as follows:


ROIC percentage
measured in respect of	Vesting
last financial year of the	percentage of
Performance Period	ROIC Tranche
Below 10.2%		0	%
10.2%		50	%
11.2% or above		100	%

5.5 Vesting is on a straight-line basis for performance between the minimum and maximum levels.

The EPS Measure

6.1 The Vesting of one half of the Matching Share Award relates to the average growth in Adjusted Earnings per Share at constant currencies ( Adjusted EPS ) of the Qualifying Companies measured over, save as provided for in 6.2 below, the Performance Period. The portion of a Matching Share Award subject to the EPS Measure is referred to as the ‘ EPS Tranche ’ .

6.2 For Matching Share Awards granted in 2010, Average Adjusted EPS Growth is measured over financial years 2011 and 2012 of the Qualifying Companies. In addition, for any part of the EPS Tranche of the 2010 Matching Share Award to Vest, Average Adjusted EPS Growth must be positive over the three financial years of the Qualifying Companies ending 31 December 2012.

6.3 The following definitions apply in respect of Adjusted EPS:

	(i)		Adjusted EPS Growth = the arithmetic mean of the growth in Adjusted EPS at constant currencies achieved by the Qualifying Companies over a relevant financial year;

	(ii)		Average Adjusted EPS Growth = the average of the Adjusted EPS Growth over the relevant period of measurement;

	(iii)		Adjusted Earnings = adjusted reported earnings. Adjustments include amortisation and impairment of acquired intangible assets and goodwill, exceptional restructuring and acquisition related charges, gains/losses

Page 20

on business disposals and other non-operating items, related tax effects and movements in deferred tax balances not expected to crystallise in the near term. The Committee retains discretion to adjust for changes in the net pension financing credit;

	(iv)		Adjusted Earnings Per Share = Adjusted Earnings divided by the Number of Shares;

	(v)		Number of Shares = weighted average number of shares in issue excluding shares held in treasury or by the Reed Elsevier Group plc Employee Benefit Trust; and

	(vi)		Constant currencies = refers to measurement at constant rates of exchange using the prior full year average and hedge rates.

The Committee has discretion to adjust this definition of Adjusted EPS to take account of any changes in recognised accounting standards or practice, fiscal regime or capital structure, to ensure consistent measurement and accountability.

6.4 The number of Matching Shares in the EPS Tranche which is capable of Vesting will be determined as follows:


	Vesting
	percentage of
Average Adjusted EPS Growth	EPS Tranche
Below 4% per annum		0	%
4% per annum		50	%
9% or above per annum		100	%

6.5 Vesting is on a straight-line basis for performance between the minimum and maximum levels.

Determining satisfaction of targets at end of performance period

7. Following the end of the relevant Performance Period the Committee shall calculate and confirm with the auditors the Average Adjusted EPS Growth and ROIC over the relevant period of measurement.

Adjustments

8.1 The Committee may make such adjustments to the Performance Target applicable to outstanding Matching Share Awards as it considers appropriate to take account of any factors which are relevant in the opinion of the Committee and in particular if there is an event which causes it to consider that the Performance Target, or any part of it, is no longer a fair measure of performance. The amended Performance Target shall be at least as challenging as the one originally set.

8.2 The Committee has discretion to adjust the definition or method of calculation of Adjusted EPS and ROIC (or any other applicable term or measure) as set out in this Schedule to take account of any changes in recognised accounting standards or

Page 21

practice, fiscal regime or capital structure, to ensure consistent measurement and accountability.

8.3 Without prejudice to the generality of paragraphs 8.1, 8.2 and 9, the Committee may, in consultation with the auditors, make the following adjustments in relation to the calculations to be carried out in accordance with this Schedule:

	(a)		any adjustments it considers appropriate if an event occurs giving rise to an adjustment of Awards under Rule 15 of the Plan; and

	(b)		any adjustments it considers appropriate if there is any modification in relation to the relevant international accounting standard used to calculate EPS or ROIC.

Overriding Power

9. In determining the level of Vesting of a Matching Share Award under the Plan, the Committee will take into account the overall business performance of the Qualifying Companies and the Group over the relevant performance period and any other factors that it considers appropriate and may modify the Vesting level if it considers that such a modification would result in a fairer outcome.

Page 22

SCHEDULE 2

US Participants

This Schedule was adopted by the directors of Reed Elsevier Group plc on 21 April 2010.

The Rules of the Plan apply to Matching Share Awards granted to US Participants subject to the modifications contained in this Schedule.

	(A)		In this Schedule, terms shall have the same meaning as in Rule 1 of the Rules unless modified by this Schedule.

	(B)		*US Participant* . Rule 1 is revised by the addition of the following definition of “US Participant”:

			*US Participant* means a Participant who is subject to United States taxation by reason of being a United States national, or resident in the United States for United States tax purposes;

	(C)		“Retirement” means, for the purposes of the application of Rule 8.2(b) of the Plan, in relation to a US Participant, circumstances which the Committee determines on a case by case basis and in its absolute discretion to constitute retirement (irrespective of whether or not applicable retirement eligible criteria have been met);

	(D)		*Release of Shares.* Rule 6.2 shall have the additional requirement that if Shares are to be released to a US Participant, they shall in all instances be released no later than March 15 of the year following the year in which the Investment Period ceases.

	(E)		*Dividend Equivalent — Cash Payment.* Rule 7.2(c) shall have the additional requirement that any cash payment to the US Participant under this Rule shall in all instances be released no later than March 15 of the year following the year in which the Investment Period ceases.

	(F)		*Dividend Equivalent — Shares in Lieu of Cash.* Rule 7.3 shall have the additional requirement that if Shares are to be released to a US Participant in lieu of cash, they shall in all instances be released no later than March 15 of the year following the year in which the Investment Period ceases.

	(G)		*Approved Leaver.* Rule 8.2 shall have the additional requirement that the Shares released to a US Participant shall in all instances be transferred to the US Participant on or before March 15 of the year following the year in which the Investment Period ceases.

	(H)		*Death, Injury, Disability and Ill-health.* Rule 8.4 shall have the additional requirement that the Shares released to a US Participant or to a US Participant’s personal representative following the US

Page 23

Participant’s cessation of employment by reason of death, injury, disability or ill-health shall in all instances be transferred to the US Participant or the US Participant’s personal representative on or before March 15 of the year following the year in which the US Participant’s cessation of employment occurs.

	(I)		*Award Rollover.* Except to the extent consistent with the requirements of Section 409A of the United States Internal Revenue Code (“Code”) for the deferral of compensation without penalty or additional tax or unless an exception to the application of Code Section 409A applies, Rule 13 shall not apply to any Matching Share Award held by a US Participant if, at the time the election provided by Rule 13 is available to the US Participant, it has Vested. In such case, the Rules of the Plan shall apply to the Matching Share Award without regard to Rule 13.

	(J)		*Application of Code Section 409A.* Although neither the Committee nor any member of the Group guarantees any particular tax treatment to a US Participant, Matching Share Awards, granted pursuant to this Schedule are intended to be exempt from Section 409A of the United States Internal Revenue Code under the exception for short-term deferrals set forth in Section 1.409A-1(b)(4) of the United States Income Tax Regulations (which requires, in the case of an employer with a fiscal year ending 31 December, that Shares in satisfaction of a Matching Share Award be transferred to the US Participant no later than March 15 of the calendar year following the calendar year in which the award is no longer subject to a substantial risk of lapsing) and shall be limited, construed and interpreted in accordance with such intent.

Page 24

SCHEDULE 3

ELSEVIER REED FINANCE BV

The Rules of the Plan apply to Matching Share Awards granted to employees of Elsevier Reed Finance BV (“ERF”), or of companies under the Control of ERF, subject to the modifications contained in this Schedule.

	(A)		In this Schedule, terms shall have the same meaning as in Rule 1 of the Rules unless modified by this Schedule.

	(B)		The definition of Group shall be construed as including ERF and every company which is under the Control or ERF.

	(C)		Matching Share Awards shall not be granted under this Schedule without the agreement of the supervisory board of ERF.

Page 25

SCHEDULE 4

French Participants

This Schedule was adopted by the directors of Reed Elsevier Group plc on 21 April 2010.

The purpose of this Schedule is to make certain variations to the terms of the Plan in order to satisfy French securities laws, exchange control, corporate law and tax requirements (especially the provisions of Articles L.225-197-1 et seq. of the French Commercial Code (FCC)) to qualify for favourable income tax and social security treatment in France.

The Rules of the Plan apply to Matching Share Awards granted to French participants subject to the modifications contained in this Schedule.

1.		Definitions

1.1		The definitions of *Matching Share Award* and *Group* in Rule 1.1 are deleted and replaced with the following definitions:

		*Matching Share Award* means a non-transferable, unfunded and conditional right granted under Rule 4 to receive Shares without payment and references to Matching Shares will be construed accordingly;

		*Group* means the Company and (i) any company in which the Company holds, directly or indirectly, at least 10 per cent of the share capital or voting rights; and (ii) any company holding, directly or indirectly, at least 10 per cent of the share capital or voting rights of the Company and (iii) any company for which at least 50 per cent of the share capital or voting rights are held by a company which holds at least 50 per cent of the share capital of the Company and member of the Group will be construed accordingly;

1.2		The following new definitions will be added for the purpose of Matching Share Awards granted under this Schedule:

		*Defined Disability* means a disability of the second or third category under the meaning of Article L.341-4 of the French Social Security Code;

		*Eligible Individual* means:

	•		any salaried employee of a member of the Group, or a corporate officer holding the duties of Chairman of the Board, General Manager, Deputy General Managers, or member of the Directory Board or Manager (respectively President du Conseil d’administration, Directeur Général, Directeurs Généraux Délégués, membres du Directoire and Gérant ) of any member of the Group,

	•		who is a salaried employee of the Company or any member of the Group who does not hold 10% or more (taking into account any unvested Matching Share Awards under this Plan or any other share plan subject to provisions of articles L.225-197-1 et seq. of the FCC) of the share capital of RE NV or RE PLC, or would, as a result of a

Page 26

grant being made under this Plan, hold 10% or more of the share capital of RE NV or RE PLC.

		*Holding Period* means a two-year period following the transfer of Shares under the Plan to a Participant, during which the Shares cannot be sold, transferred or otherwise disposed of;

2.		Rule 2 (Eligibility)

		In Rule 2, the word “Employee” will be replaced by “Eligible Individual”.

3.		Rule 6 (Normal Vesting of Matching Share Awards)

3.1		Rule 6.1 shall be supplemented with the following provision:

		“The Normal Vesting Date for Matching Share Awards will not be before the second anniversary of the Date of Grant. Furthermore, if a Matching Share Award would otherwise Vest in accordance with any provision of the Plan or of this Schedule 4 (except as provided under Rule 8.5, as amended by paragraph 6.1 of this Schedule 4, (death and Defined Disability)) before the second anniversary of the Date of Grant, the Matching Share Award will not so Vest but will continue until the second anniversary of the Date of Grant, or a later date as determined by the Committee, when it will Vest”.

3.2		Rule 6.2 will be deleted and replaced with the following:

		“The Investment Shares will be released to the Participant as soon as reasonably practicable following the Normal Vesting Date along with the Dividend Equivalent which a Participant is entitled to under Rule 7 and subject to paragraph 4 of this Schedule.

		Any Vested Matching Shares will be transferred, as soon as reasonably practicable after that date, subject to any Dealing Restrictions, to a share account administered in the name of and for the benefit of the Participant by an account keeper (teneur de compte) designated by the Committee. Participants will have full shareholder voting and dividend rights on the transferred Matching Shares.

		Any Matching Shares transferred will be held by the account keeper on behalf of the Participant for the duration of the Holding Period, except as provided under Rule 8.5, as amended by paragraph 6.1 of this Schedule 4, (death and Defined Disability), or as otherwise provided for in the FCC or in the French tax Code as an exception to the Holding Period.

		On expiry of the Holding Period, the participant will be free to dispose of the Matching Shares.”

Rule 7 (Entitlement to Dividend Equivalents)

A Matching Share Award granted under this Schedule shall only be granted on the basis that it carries a right to Dividend Equivalents to the extent permitted under the FCC and the French Tax Code and without jeopardising the favourable tax and social security regime applicable to the related Matching Share Awards.

Page 27

5.		Rules 8.2 and 8.3 (Approved Leaver)

5.1		Matching Shares which Vest in accordance with Rule 8.2 will be subject to the Holding Period.

5.2		Rule 8.3 will not apply to Matching Share Awards granted under this Schedule.

6.		Rules 8.4 and 8.5 (Death, Injury, Disability and ill-health)

6.1		Rules 8.4 and 8.5 will be deleted and replaced with the following new Rules:

		8.4 Except as otherwise provided in these Rules, in the event that the Participant ceases to be an Employee before the Normal Vesting Date by reason of injury, disability or ill-health (excluding Defined Disability) , the Participant’s Matching Share Award and Investment Shares will be treated in accordance with Rule 8.2 and any Matching Shares which Vest will be subject to the Holding Period.

		8.5 Notwithstanding any other Rule of the Plan, where a Participant ceases employment before the Normal Vesting Date by reason of death or Defined Disability:

	a)		the Matching Share Award will Vest over a Pro-rated Number of Shares subject to an assessment of performance based on progress made against the Performance Target at the Termination Date as determined by the Committee in its absolute discretion. Such determination will take place as soon as practicable after the Termination Date and to the extent that the Matching Share Award does not Vest on the date of determination, it will immediately lapse; or

	b)		the Performance Target will be waived and/or the Matching Share Award will Vest in full on or shortly after the Termination Date as determined by the Committee. To the extent that the Matching Share Award does not Vest, it will immediately lapse.

		Any Matching Shares which Vest in accordance with this Rule 8.5 will be transferred to the Participant (or, in the case of death, to the personal representatives of the Participant) as soon as practicable following Vesting, and will not be subject to any Holding Period.

		The Investment Shares will be released in full to the Participant (or, in the case of death, to the personal representatives of the Participant) as soon as reasonably practicable following the termination Date.

7.		Rules 10, 11, 12, 13, 14 and 15 (Change of Control, Internal Reorganisation, Rollover, Winding up, Adjustment of Awards)

		Rules 10, 11, 12, 13, 14 and 15 of the Plan will apply in accordance with Article L.225-197-1-III of the FCC to the extent that the Committee intends the Matching Share Awards to maintain favourable tax treatment under this

Page 28

Schedule 4. However, in the event the Committee does not intend to maintain such favourable tax treatment, Rules 10, 11, 12, 13, 14 and 15 of the Plan will prevail notwithstanding any possible detrimental tax or social security consequences for the Participant.

8.		Rule 18 (Administration and Amendment)

		A new Rule 18.2(d) will be added as follows:

		(d) changes do not affect the French qualifying status of the Matching Share Awards granted under Schedule 4 and provided that no such changes will adversely affect the rights of any Participant without such Participant’s consent”

9.		Rule 19.12 (No transfer of Matching Share Awards)

		In Rule 19.12, the following words will be deleted:

		“or the assignment of a Matching Share Award, with the prior consent of the Committee, subject to any terms and conditions the Committee imposes”

10.		Rule 19.14 (Taxation)

		In Rule 19.14, the following words will be deleted:

		“and to enter into any election specified by the Company under Chapter 2 of Part 7 of the Income Tax (employment & Pensions) Act 2003 in respect of shares to which he is or may become entitled under the Plan”

		In Rule 5.1, the wording after (ii) will be deleted.

11.		Severability

The terms of the Plan, as amended by this Schedule 4, are severable and if any one or more provisions are determined to be illegal or otherwise unenforceable under French law, in whole or in part, the remaining provisions will nevertheless be binding and enforceable.

Page 29

SCHEDULE 5

Cash Alternative

If deemed necessary in order to ensure compliance with tax and legal country specific requirements (e.g. exchange control and securities laws) in the countries in which the Plan operates then, notwithstanding any provision to the contrary in these Rules:

	(A)		The Committee may decide to satisfy a Matching Share Award by paying to the Participant an amount equal to the market value (as determined in its discretion) of the number of Shares which would otherwise be transferred following Vesting or an amount determined on such other reasonable basis as the Committee may decide (which could for example, allow for the deduction of any applicable expenses).

	(B)		The Committee may grant a Matching Share Award on the basis that it will be satisfied in cash, as opposed to Shares, as set out in (A) above.

Page 30

Exhibit 4.4

RULES OF THE
REED ELSEVIER GROUP PLC GROWTH PLAN

Approved by shareholders of
Reed Elsevier PLC in general meeting on 21 April 2010

Approved by shareholders of
Reed Elsevier NV in general meeting on 20 April 2010

Adopted by the directors of Reed Elsevier Group plc on 21 April 2010

THE REED ELSEVIER GROUP PLC GROWTH PLAN 2010

1. Definitions

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

Award means, as the context requires, a Performance Share Award and/or a Matching Share Award;

Cap means the overall individual limit on Shares which a Participant may receive under the Plan as set out in Rule 3;

Capital Reorganisation means any variation in the share capital or reserves of a Qualifying Company (including, without limitation, by way of capitalisation issue, rights issue, sub-division, consolidation, or reduction);

CEO means the Chief Executive Officer of the Company;

CFO means the Chief Financial Officer of the Company;

Committee means the remuneration committee of the board of directors of the Company or other duly authorised committee;

Company means Reed Elsevier Group plc;

Control has the meaning given to it by section 995 of the Income Taxes Act 2007;

Date of Grant means the date on which an Award is granted;

Dealing Day means a day on which the London Stock Exchange, the Amsterdam Stock Exchange, Euronext, the New York Stock Exchange (or, where the primary listing of a company in the Comparator Group is outside the UK, the US or the Netherlands, the exchange on which such company’s shares are listed) is open for the transaction of business;

Dealing Restrictions means any restrictions on, or requirement for approvals for dealing in Shares whether under the Company’s, RE PLC’s or RE NV’s share dealing rules, the provisions of the Model Code for Securities Transactions by Directors of Listed Companies, the provisions of the Listing Rules of the UK Listing Authority or the City Code on Takeovers and Mergers or any of their equivalents in any applicable jurisdiction;

Deferred Performance Shares means the Shares comprised in a Performance Share Award in respect of which the Committee has determined that the performance conditions imposed under Rule 6.3 have been satisfied but which, except as otherwise provided in these Rules, Vest on the Five Year Vesting Date;

Dividend Equivalent means a right to a cash payment or Shares in accordance with Rule 12.

Page 1

Dutch Share means an ordinary share in the capital of RE NV or shares representing those shares following any Capital Reorganisation of RE NV and includes an American Depositary Share representing a Dutch Share;

Executives means the CEO and the CFO;

Five Year Vesting Date means the date following the end of the financial year of the Qualifying Companies ending 31 December 2014, on which the Committee determines the extent to which the performance conditions imposed under Rule 9.3 have been satisfied or if there are Dealing Restrictions in place on that date, Vesting will be on such later date when those Dealing Restrictions lift;

Group means the Company and every company which is under the Control of the Company and member of the Group will be construed accordingly;

Matching Share Award means a right granted under Rule 9 to receive Shares without payment and references to Matching Shares will be construed accordingly;

Participant means any individual who holds a subsisting Award (including, where the context permits, the legal personal representatives of a deceased Participant);

Performance Share Award means a right granted under Rule 6 to receive Shares without payment and references to Performance Shares will be construed accordingly;

Personal Shares means any Shares which are beneficially owned by a Participant, excluding any Shares invested in the Reed Elsevier Group plc Bonus Investment Plan 2003 or the Reed Elsevier Group plc Bonus Investment Plan 2010;

Plan means this Reed Elsevier Group plc Growth Plan as amended from time to time;

Qualifying Company means each of RE PLC and RE NV;

RE NV means Reed Elsevier NV;

RE PLC means Reed Elsevier PLC;

Rules means these Plan rules;

Share means a UK Share and/or a Dutch Share and Shareholder will be construed accordingly;

Termination Date means the date on which a Participant ceases to be employed by RE PLC, RE NV or any member of the Group;

Three Year Vesting Date means the date following the end of the financial year of the Qualifying Companies ending 31 December 2012, on which the Committee determines the extent to which the performance conditions imposed under Rule 6.3 have been satisfied or if there are Dealing Restrictions in place on that date, Vesting will be on such later date when those Dealing Restrictions lift;

Page 2

UK Share means an ordinary share in the capital of RE PLC or shares representing those shares following any Capital Reorganisation of RE PLC and includes an American Depositary Share representing a UK Share; and

Vesting Date means the date on which a Participant becomes absolutely entitled to receive Shares under an Award or Deferred Performance Shares in accordance with these Rules and Vest , Vested and Vesting will be construed accordingly.

1.2 Where the context permits the singular will include the plural and vice versa and the masculine will include the feminine. Headings will be ignored in construing the Plan.

1.3 References to any act of Parliament will include any statutory modification, amendment or re enactment thereof.

2. Eligibility

Participation in the Plan is restricted to the Executives.

3. Overall Individual Limit for Awards

3.1 Notwithstanding any other provision of the Rules, the total number of Shares which a Participant may receive in respect of Awards granted under the Plan will not exceed 150% of the number of Shares comprised in the Participant’s Performance Share Award. Dividend Equivalents do not count towards this limit.

3.2 If a Participant ceases to be an Executive in circumstances where Rule 13.3 applies, this limit will be reduced by multiplying it by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60 or such other reduction as the Committee may determine appropriate.

4. Requirement to Commit Personal Shares

4.1 Participation in this Plan is subject to the Participant committing a specified number of Personal Shares to the Plan as at the Date of Grant of a Performance Share Award (or by such other date as the Committee may permit in its discretion). To the extent that any or all of a Participant’s Personal Shares are not so committed by the prescribed date, any Awards will immediately lapse in full.

4.2 The number of Personal Shares required to be committed to the Plan is, in the case of the CEO 300% and, in the case of the CFO 200% of the Participant’s basic annual salary as at the Date of Grant of the Participant’s Performance Share Award.

4.3 The Committee will determine the method by which Participants are required to commit Personal Shares to the Plan. This may include requiring that:

(a)		the Participant signs an undertaking to retain the beneficial ownership of the Personal Shares until the Five Year Vesting Date and not to charge, pledge or grant any lien or security over them; or

(b)		the Participant’s Personal Shares are transferred to and held by a specified nominee on the Participant’s behalf.

Page 3

4.4 A Participant’s Personal Shares must remain committed to the Plan for so long as he continues to hold an Award. A Participant’s Performance Share Award, entitlement to Deferred Performance Shares and Matching Share Award will lapse with immediate effect if any of his Personal Shares cease to be committed to the Plan, except as expressly provided for by these Rules.

5. General provisions relating to Awards

5.1 The grant of an Award is conditional upon a Participant agreeing to comply with any arrangements specified by the Company for the payment of tax and social security contributions in respect of Shares to which he is or may become entitled under the Plan including, without limitation (i) the right to sell on the Participant’s behalf sufficient Shares to satisfy any tax or social security contributions liability on his part for which any member of the Group may be liable and (ii) entering into any election under Chapter 2 of Part 7 of the Income Tax (Earnings & Pensions) Act 2003 specified by the Company.

5.2 In addition to the performance conditions imposed by Rules 6.3 and 9.3 and the condition imposed by Rule 5.1, the Committee may make the grant of Awards subject to any other conditions it determines appropriate including requiring a Participant to agree to comply with certain post-employment restrictive covenants.

5.3 Awards will be granted by deed. Each Participant will receive a statement (electronically or in hard copy) following the relevant Date of Grant summarising the main terms of the Award.

6. Grant of Performance Share Awards

6.1 Subject to the terms of these Rules, the Committee may grant a Performance Share Award to an Executive in its absolute discretion.

6.2 A Performance Share Award may only be granted during the period of 42 days commencing on:-

(a)		the day following the day on which the Plan was approved by both RE PLC in general meeting and RE NV in general meeting; or

(b)		the day following the lifting of any Dealing Restrictions which prevented the granting of the Performance Share Award during the period specified above,

unless the Committee determines that exceptional circumstances exist which justify the grant of a Performance Share Award at such other time, subject to the requirement that Performance Share Awards cannot be granted after 31 December 2010.

6.3 Except as otherwise permitted in these Rules, Performance Share Awards will only Vest to the extent the performance conditions applicable to Performance Share Awards, as set out in Schedule 1 to this Plan, have been satisfied.

7. Individual Limit For Performance Share Awards

The maximum aggregate value of Shares comprised in a Participant’s Performance Share Award will not exceed, as at the Date of Grant of that Performance Share Award, 600% of the Participant’s basic salary from the Group as at the Date of Grant.

Page 4

8. Vesting of Performance Share Awards

8.1 The number of Performance Shares which may Vest under a Performance Share Award will be determined by the Committee by reference to the extent to which the performance conditions imposed under Rule 6.3 have been fulfilled, and any other conditions to which the Performance Share Award is subject are fulfilled or waived.

8.2 Except as otherwise provided in these Rules, 50% of the number of Shares determined in accordance with Rule 8.1, if any, will Vest on the Three Year Vesting Date. Shares to satisfy the Vested Performance Shares will be transferred to Participants as soon as reasonably practicable after that date along with any related Dividend Equivalents.

8.3 Except as otherwise provided in these Rules, 50% of the number of Shares determined in accordance with Rule 8.1, if any, will become Deferred Performance Shares and Vest on the Five Year Vesting Date, subject to the Participant remaining an employee of RE PLC, RE NV or a member of the Group until that date. Shares to satisfy the Vested Deferred Performance Shares will be transferred to Participants as soon as reasonably practicable after that date along with any related Dividend Equivalents.

9. Grant of Matching Share Awards

9.1 Subject to the terms of these Rules, the Committee may grant a Matching Share Award to an Executive in its absolute discretion provided that the Executive has not ceased to be an employee of the Group and is not under notice before the Date of Grant of the Matching Share Award, unless the circumstances set out in Rule 13.3 apply, in which case the Executive may be granted a Matching Share Award.

9.2 A Matching Share Award may only be granted during the period of 42 days commencing on:-

(a)		the day following the announcement of results for the Qualifying Companies for the 2012 financial year; or

(b)		the day following the lifting of any Dealing Restrictions which prevented the granting of the Matching Share Award during the period described in (a) above,

unless the Committee determines that exceptional circumstances exist which justify the grant of a Matching Share Award at such other time, subject to the requirement that Matching Share Awards cannot be granted after 31 December 2013.

9.3 Except as otherwise permitted in these Rules, Matching Share Awards will only Vest to the extent the performance conditions applicable to Matching Share Awards, as set out in Schedule 1 to this Plan, have been satisfied.

10. Individual Limit For Matching Share Awards

The number of Shares comprised in a Participant’s Matching Share Award is equal to the number of Deferred Performance Shares, if any, and Personal Shares held by a Participant in the Plan at the Date of Grant of the Matching Share Award.

Page 5

11. Vesting of Matching Share Awards

11.1 The number of Shares which Vest under a Matching Share Award will be determined by the Committee by reference to the extent to which the performance conditions imposed under Rule 9.3 have been fulfilled, and any other conditions to which the Matching Share Award is subject, have been fulfilled or waived. This number is subject to the Cap.

11.2 Except as otherwise provided in these Rules, Matching Shares, if any, will Vest on the Five Year Vesting Date and will be transferred to Participants as soon as reasonably practicable after that date along with any related Dividend Equivalents.

12. Entitlement to Dividend Equivalents

12.1 In addition to any Shares which a Participant becomes entitled to on the Vesting of a Performance Share Award, a Matching Share Award or Deferred Performance Shares, the Participant will, subject to Rule 12.3, also be entitled to a cash payment equal in value to the ordinary dividends (excluding any associated tax credit) which would have been paid on the Vested Shares during the following periods: (a) in respect of Vested Performance Shares, commencing on 1 January 2010 and ending on 31 December 2012,(b) in respect of Vested Matching Shares, commencing on 1 January 2013 and ending on 31 December 2014 and (c) in respect of Vested Deferred Performance Shares, commencing on 1 January 2010 and ending on 31 December 2014, or ending on such earlier date when Shares Vest under the Plan.

12.2 The cash payment to which the Participant becomes entitled under Rule 12.1:

(a)		will be calculated (in such manner as the Committee sees fit) by reference to the currency of payment of the underlying dividend (and paid in such currency as the Committee sees fit);

(b)		will be calculated without any entitlement to interest (or other type of investment return) in the period between the dividend payment date and the Vesting Date;

(c)		will be paid (subject to such deductions as are required by law) within one month of the relevant Vesting Date; and

(d)		will be calculated by reference to ordinary dividends and without regard to special dividends or distributions or dividends-in-specie.

12.3 Instead of making a cash payment, the Committee may in its discretion satisfy any entitlement to Dividend Equivalents arising in accordance with Rule 12.1 by transferring existing Shares with an equivalent value (as determined at the relevant Vesting Date).

12.4 For the avoidance of doubt, any payment referred to in this Rule 12 does not represent an entitlement to actual dividends on the underlying Shares, by reason of the Participant not being beneficial owner of the Shares at that time.

Page 6

13. Cessation of employment

Participant gives or receives Notice

13.1 Except as otherwise provided in these Rules, if the Participant gives or receives notice of termination of his employment with RE PLC, RE NV or any member of the Group prior to the Three Year Vesting Date or the Five Year Vesting Date (as applicable), any outstanding Performance Share Award, Matching Share Award and entitlement to Deferred Performance Shares will lapse. If the Participant has given notice, the lapse date is the date on which the Participant gave notice. If the Participant has received notice, the lapse date is the Termination Date or such other date as determined by the Committee.

13.2 Where Rule 13.1 applies, a Participant’s Personal Shares will be released from the Plan in full as soon as reasonably practicable following the date notice has been received from the Participant or the Termination Date as the case may be.

Approved Leavers

13.3 Except as otherwise provided in these Rules, where a Participant ceases to be an employee of RE PLC, RE NV or a member of the Group by reason of:

(a)		retirement with the consent of the Company;

(b)		injury, disability or ill-health; or

(c)		any other reason which the Committee, in its absolute discretion, determines,

before the Three Year Vesting Date, Rule 13.4 will apply and if he ceases to be so employed after the Three Year Vesting Date but before the Five Year Vesting Date, Rule 13.5 will apply.

13.4 If a Participant ceases to be employed in accordance with Rule 13.3 before the Three Year Vesting Date:

(a)		a Performance Share Award will continue on a pro-rated basis. For these purposes, the pro-rated Performance Share Award will be over such number of Shares as is determined by multiplying the number of Shares originally comprised in the Performance Share Award by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2012 and B is 36;

(b)		50% of the pro-rated Performance Share Award will, to the extent that the relevant performance conditions have been satisfied, Vest on the Three Year Vesting Date;

(c)		the remaining 50% of the pro-rated Performance Share Award will be subject to a further pro-rating reduction by multiplying the number of Shares originally comprised in 50% of the pro-rated Performance Share Award by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60 and will become Deferred Performance Shares. The Deferred Performance Shares will, except as otherwise provided in the Rules, Vest on the Five Year Vesting Date. The balance of the 50% of the pro-rated Performance Share

Page 7

		Award which does not become Deferred Performance Shares will Vest on the Three Year Vesting Date;

(d)		for the avoidance of doubt, a Matching Share Award will be granted in accordance with Rules 9 and 10 over such number of Shares as is equal to the aggregate of the Deferred Performance Shares and Personal Shares after the time pro-rating reductions provided for in this Rule 13.4; and

(e)		a pro-rated number of a Participant’s Personal Shares will be retained within the Plan. For these purposes, the pro-rated number means such number of Shares as is determined by multiplying the number of Personal Shares by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60. The balance of the Participant’s Personal Shares will be released from the Plan as soon as reasonably practicable following the Termination Date.

13.5 If a Participant ceases to be employed in accordance with Rule 13.3 after the Three Year Vesting Date but before the Five Year Vesting Date:

(a)		a Participant will remain entitled to a pro-rated number of Deferred Performance Shares. For these purposes, the pro-rated number of Deferred Performance Shares will be determined by multiplying the number of Deferred Performance Shares as determined at the Three Year Vesting Date by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60. The balance of the Deferred Performance Shares will be released as soon as reasonably practicable following the Termination Date;

(b)		a Matching Share Award will continue as a pro-rated Matching Share Award. For these purposes, the pro-rated Matching Share Award will be over such number of Shares as is determined by multiplying the number of Shares originally comprised in the Matching Share Award by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60. The balance of the Matching Share Award will lapse;

(c)		the pro-rated Matching Share Award will, to the extent that the relevant performance conditions have been satisfied, Vest on the Five Year Vesting Date; and

(d)		the pro-rated number of a Participant’s Personal Shares will be retained within the Plan. For these purposes, the pro-rated number means such number of Shares as is determined by multiplying the number of Personal Shares by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60. The balance of the Participant’s Personal Shares will be released from the Plan as soon as reasonably practicable following the Termination Date.

13.6 In such circumstances as the Committee may in its absolute discretion determine, the Committee may vary the application of Rule 13.4 and Rule 13.5 to allow an Award to Vest over a pro-rated number of Shares on such earlier date as it may determine, subject always to satisfaction of the relevant performance conditions at that date. Shares will be transferred to the Participant as soon as reasonably

Page 8

practicable following the Award Vesting in accordance with this Rule 13.6. Where Rule 13.6 applies, a Participant’s Personal Shares will be released from the Plan in full on the date on which his Award Vests.

Where a Participant ceases to be an Executive but continues an employee within the Group

13.7 The Committee may determine that Rules 13.4 and 13.5 will apply where a Participant ceases to be an Executive but continues to be an employee of RE PLC, RE NV or any member of the Group.

Death

13.8 Where a Participant ceases to be an employee of RE PLC, RE NV or a member of the Group by reason of death, before the Three Year Vesting Date then Rule 13.9 will apply, and after the Three Year Vesting Date but before the Five Year Vesting Date, Rule 13.10 will apply.

13.9 If a Participant ceases to be employed in accordance with Rule 13.8 before the Three Year Vesting Date:

(a)		a Performance Share Award will Vest, subject to performance at the date of death, over a pro-rated number of Shares. The performance conditions will be assessed based on progress made against targets at the date of death as determined at the Committee’s absolute discretion. For these purposes, the pro-rated number of Shares will be such number of Shares as is determined by multiplying the number of Shares as would otherwise Vest under the Performance Share Award by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2012 and B is 36. Shares and related Dividend Equivalents will be transferred to a Participant’s personal representatives as soon as reasonably practicable following Vesting;

(b)		a Participant’s Personal Shares will be released from the Plan in full to his personal representatives as soon as reasonably practicable following Vesting; and

(c)		, no Matching Share Award will be granted and there will be no entitlement to Deferred Performance Shares.

13.10 If a Participant ceases to be employed in accordance with Rule 13.8 after the Three Year Vesting Date but before the Five Year Vesting Date:

(a)

a Matching Share Award will Vest, subject to performance at the date of death, over a pro-rated number of Shares. The performance conditions will be assessed based on progress made against targets at the date of death as determined at the Committee’s absolute discretion. For these purposes, the pro-rated number of Shares will be such number of Shares as is determined by multiplying the number of Shares under the Matching Share Award by A/B where A is the number of complete calendar months which the Executive was employed between 1 January 2010 and 31 December 2014 and B is 60. Shares and related Dividend Equivalents will be transferred to a Participant’s personal representatives as soon as reasonably practicable following Vesting;

Page 9

(b)

a Participant’s Personal Shares will be released from the Plan in full to his personal representatives as soon as reasonably practicable following Vesting; and

(c)

a Participant’s Deferred Performance Shares will Vest on the date of death and be transferred, along with related Dividend Equivalents to the Participant’s personal representatives as soon as reasonably practicable following Vesting.

13.11 The Committee has discretion to vary the application of Rules 13.8 to 13.10 and determine that an Award should be treated as set out in Rules 13.3 to 13.5 instead.

14. Claw-Back Arrangements

Breach of Restrictive Covenants

14.1 If a Participant breaches any term of his post-termination restrictive covenants (such breach to be determined by the Committee acting fairly and reasonably), any unvested Awards and Deferred Performance Shares will lapse on the date of the Committee’s determination and the Committee may require him to pay to the Company or any other member of the Group, within seven days of written demand from the Company, the Relevant Amount (as defined in Rule 14.2 below).

14.2 The Relevant Amount is an amount equal to A minus both B and C where:

A is an amount equal to the pre-tax gain realised by the Participant in respect of any Awards, Deferred Performance Shares and Dividend Equivalents in the period beginning six months before the Termination Date and ending when the Participant’s restrictive covenants cease to apply. For these purposes, the gain will be the sum of the market value of the Vested Shares when received by the Participant and the related Dividend Equivalents, and such gain will be determined irrespective of whether the Participant has sold or retained the Shares so acquired;

B is an amount equal to the tax and social security charges and liabilities incurred by the Participant in respect of A ; and

C is any payment of the Claw-back Amount, determined in accordance with Rule 14.4 below, in respect of A .

Materially misstated financial or other data

14.3 If the Committee, within two years of, as the case may be, the Three Year Vesting Date or the Five Year Vesting Date, considers in good faith that the Vesting of the relevant Award, the Vesting of Deferred Performance Shares and/or the payment of Dividend Equivalents was determined on the basis of materially misstated financial or other data (the Incorrect Award ), it will, unless it determines otherwise, recover the Claw-back Amount (as defined in Rule 14.4 below) by taking one or more of the following actions:

(a)

reduce any outstanding unvested Awards and/or Deferred Performance Shares by the Claw-back Amount; and/or

Page 10

(b)

require the Participant to pay to the Company, within thirty days of a written demand from the Company, the Claw-back Amount.

14.4 The Claw-back Amount is the difference in value between (i) the Incorrect Award and (ii) the Awards, Deferred Performance Shares and Dividend Equivalents, which would have Vested or been payable had the correct data, as determined by the Committee acting fairly and reasonably, been used. This may be expressed as a number of Shares or a monetary amount or a combination thereof, as the Committee considers appropriate. In determining the Claw-back Amount, the Committee may take into account such matters as it sees fit including, but not limited to:

(a)		the difference between the number of Shares under the Incorrect Award and the number of Shares the Committee considers should have Vested had the correct data been used;

(b)		any gain made by the Participant on the sale of Shares comprised in the Incorrect Award;

(c)		any tax and/or dealing costs incurred by the Participant in connection with the Incorrect Award, and

(d)		whether the Participant has made a payment pursuant to Rules 14.1 to 14.3 which would take account of Shares subject to an Incorrect Award.

14.5 By accepting an Award, a Participant will be bound by Rule 14 (i) notwithstanding that it will only be applicable after the release of Shares under these Rules and (ii) whether or not the essential terms of this Rule 14 have been separately notified to each Participant.

15. Change of Control of a Qualifying Company

15.1 Except as otherwise provided in these Rules, if any person:

(a)		obtains Control of a Qualifying Company as a result of making an offer to acquire Shares which is either unconditional or is made on a condition such that if it is satisfied the person making the offer will have Control of that Qualifying Company;

(b)		becomes bound or entitled to acquire Shares under sections 979 and 983 of the Companies Act 2006 (or in relation to RE NV becomes entitled to acquire compulsorily Shares held by minority shareholders); or

(c)		obtains Control of a Qualifying Company in pursuance of a compromise or arrangement sanctioned by the Court under section 899 of the Companies Act 2006 (or in relation to RE NV under any equivalent legislative provision in the Netherlands),

then any unvested Awards and /or entitlement to Deferred Performance Shares over Shares in that Qualifying Company (but not those in the other Qualifying Company) will Vest within 30 days of the relevant event subject to the relevant performance conditions as applicable. The performance conditions will be assessed based on progress made against targets as at the date of the relevant event as determined by the Committee. The number of Shares which Vest will be subject to a pro-rating reduction in accordance with Rule 15.2 or 15.3 below.

Page 11

15.2 Where Rule 15.1 applies before the Three Year Vesting Date then the pro-rating reduction applicable to a Performance Share Award will be determined by multiplying the number of Shares under a Performance Share Award by A/B where A is the number of complete calendar months between 1 January 2010 and the date of the relevant event (but not exceeding 36) and B is 36. For the avoidance of doubt, no Matching Share Award will be granted and there will be no entitlement to Deferred Performance Shares.

15.3 Where Rule 15.1 applies after the Three Year Vesting Date but before the Five Year Vesting Date then the pro-rating reduction applicable to a Matching Share Award and Deferred Performance Shares will be determined by multiplying the number of Shares under a Matching Share Award or Deferred Performance Shares (as applicable) by A/B where A is the number of complete calendar months between 1 January 2010 and the date of the relevant event (but not exceeding 60) and B is 60.

15.4 Any Award and/or any Deferred Performance Shares over Shares in that Qualifying Company which do not Vest as a result of the relevant event will lapse on the relevant event.

15.5 A Participant’s Personal Shares in that Qualifying Company will be released from the Plan in full on or as soon as reasonably practicable after the date of the relevant event.

16. Change of Control of the Company

Except as otherwise provided in these Rules, the provisions of Rule 15 will apply with any necessary changes in the event that any person (either alone or together with any person acting in concert with him) obtains Control of the Company and the Shares comprised in Awards and Deferred Performance Shares which may Vest will be Shares in both Qualifying Companies.

17. Compulsory Rollover on Internal Reorganisation

17.1 Rules 15 and 16 will not apply if the purpose and effect of the change of Control or scheme of arrangement is:

(a)		to create a new holding company for the relevant Qualifying Company, such company having substantially the same Shareholders and proportionate shareholdings as those of the Qualifying Company immediately prior to the scheme of arrangement;

(b)		to give one Qualifying Company Control (directly or indirectly) of the other Qualifying Company;

(c)		the person obtaining Control of the Company is one of the Qualifying Companies or a company under the Control of one or both of them; or

(d)		the Company remains under the ultimate Control of the Shareholders of the Qualifying Companies immediately prior to the relevant transaction affecting the Company.

17.2 If Rule 17.1 applies:

Page 12

(a)		Awards and Deferred Performance Shares will not Vest on the relevant event;

(b)		an Award will instead be exchanged for an equivalent award over such shares as the Committee determines appropriate;

(c)		Deferred Performance Shares will instead be exchanged for shares or cash and continue to be subject to the Plan on such terms as the Committee determines appropriate; and

(d)		the Committee may make any modifications to the relevant performance conditions as it determines appropriate.

17.3 The Committee may vary the application of this Rule 17 so that it applies to Awards and Deferred Performance Shares over Shares in both Qualifying Companies or to Shares in only one Qualifying Company.

17.4 Where Rule 17 applies, a Participant will not be treated as ceasing to be an employee of RE PLC, RE NV or a member of the Group until he ceases to be employed by a company which is either the relevant holding company or a subsidiary of the holding company (within the meaning of section 1159 of the Companies Act 2006).

17.5 For the avoidance of doubt, in Rules 15, 16 and 17, “Committee” means those people who were members of the Committee immediately before the event by virtue of which the applicable Rule applies.

18. Voluntary winding up

The provisions of Rule 15 will apply with such changes as may be necessary in the event that notice is duly given of a resolution for a voluntary winding up of a Qualifying Company provided that , all references in Rule 15 to the date of the relevant event will be treated as references to the date on which notice is given for the voluntary winding-up of a Qualifying Company.

19. Adjustment of awards

19.1 In the event of:

(a)		any Capital Reorganisation; or

(b)		the implementation by a Qualifying Company of a demerger or the payment by a Qualifying Company of a super-dividend which would otherwise materially affect the value of an Award and/or Deferred Performance Shares,

the definition of Shares and the number of Shares in that Qualifying Company comprised in an Award and/or Deferred Performance Shares may be adjusted in such manner as the Committee determines.

19.2 A Participant will in respect of his Personal Shares be treated in the same manner as any other holder of Shares, except that (unless the Committee determines otherwise):

(a)

in the event of a rights issue in respect of Personal Shares, the Participant (or other nominee holding Personal Shares on his behalf) will be required to sell

Page 13

sufficient rights nil-paid (at such time during the rights issue as the Committee thinks fit) as will enable the Participant to acquire with the proceeds of sale the remainder of the Participant’s rights entitlement PROVIDED THAT the Participant may elect to take up in a personal capacity the rights that would have been sold (and such Shares will not be subject to this Plan) subject to the Participant providing sufficient funds to give effect to his obligation under the first part of this sub-paragraph (a);

(b)

in the event of receipt of cash (other than dividends paid in the normal course) or securities (other than Shares) in respect of Shares (on a demerger or other reorganisation of the share capital of a Qualifying Company), the Committee will in its absolute discretion determine whether such cash or securities will be released to the Participant or whether the nominee holding Shares on behalf of the Participant will be required to apply that cash (or the proceeds of sale of such securities), after allowing for tax thereon, in the purchase of further Personal Shares to be held on behalf of the Participant.

20. Source of Shares

20.1 A Participant’s entitlement to Shares will be satisfied from purchases on a recognised stock exchange. No new Shares will be issued or Shares transferred from treasury in connection with the Plan.

21. Rights attaching to shares transferred pursuant to awards

21.1 All Shares transferred upon the Vesting of an Award and or Deferred Performance Shares will rank pari passu in all respects with the Shares in issue at the date of Vesting except in respect of any rights attaching to such Shares by reference to a record date prior to the date of Vesting.

21.2 Any Shares acquired by a Participant under this Plan will be subject to the articles of association of the relevant Qualifying Company from time to time.

22. Administration and amendment

22.1 The decision of the Committee will be final and binding in all matters relating to the Plan including the exercise of any discretion under the Rules, the interpretation of the Rules and any dispute relating to any matter in connection with the Rules.

22.2 The Committee may at any time discontinue the grant of further Awards or amend any of the provisions of the Plan in any way it thinks fit and such changes may affect Awards already granted: provided that :

(a)		the Committee will not make any amendment that would materially prejudice the interests of existing Participants except with their prior consent; and

(b)		no amendment to the advantage Participants may be made to:

	(i)		the definition of Executive;

	(ii)		the maximum entitlement of a Participant under the Plan;

	(iii)		the maximum limit on the number of Shares which can be awarded under the Plan;

Page 14

	(iv)		the basis for determining a Participant’s entitlement to Shares under the Plan and the terms on which they can be acquired;

	(v)		the terms of Shares to be provided under the Plan;

	(vi)		the adjustment provisions of Rule 19 of the Plan;

		without the prior approval of RE PLC in general meeting (and, if appropriate the prior approval of RE NV in general meeting), except in the case of minor amendments to benefit the administration of the Plan, to take account of a change in legislation or to obtain or maintain favourable tax, exchange control or regulatory treatment for Participants, RE PLC, RE NV or any member of the Group, or as otherwise permitted under these Rules; and

(c)		without prejudice to any provision of the Plan which provides for the lapse of an Award, the Committee may not cancel an Award unless the Participant agrees in writing to such cancellation.

23. General

Trustee funding

23.1 Any member of the Group may provide money to the trustees of any trust or any other person to enable them or him to acquire Shares to be held for the purposes of satisfying Awards under the Plan, or enter into any guarantee or indemnity for these purposes, to the extent not prohibited by the provisions of the Companies Act 2006.

Discretionary nature of the Plan

23.2 The rights and obligations of a Participant under the terms and conditions of his office or employment will not be affected by his participation in the Plan or any right he may have to participate in the Plan.

23.3 Participation in this Plan does not imply any right to receive Awards on the same or any other basis in any other year.

23.4 The terms of the Plan do not entitle the Participant to the exercise of any discretion in his favour.

23.5 An individual who participates in the Plan waives all and any rights to compensation or damages in consequence of the termination of his office or employment with any member of the Group for any reason whatsoever insofar as those rights arise, or may arise, from his ceasing to have rights under the Plan as a result of such termination or from the loss or diminution in value of such rights. If necessary, the Participant’s terms of employment will be varied accordingly.

Changes to a Qualifying Company’s capital structure

23.6 The existence of any Award will not affect in any way the right or power of the Company, the Qualifying Companies or their shareholders to make or authorise any or all adjustments, recapitalisations, reorganisations or other changes in the Company’s or either of the Qualifying Company’s capital structure, or any merger or consolidation of the Company or Qualifying Companies, or any issue of shares,

Page 15

bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or Qualifying Companies or any sale or transfer of all or any part of their assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

Notices

23.7 Any notice or other document which has to be given to a Participant under or in connection with the Plan may be delivered or sent by post to him at his home address according to the records of his employing company or sent by email or fax to any email address or fax number according to the records of his employing company or, in either case, such other address as may appear to the Company to be appropriate.

23.8 Notices sent by post to a Participant in the UK or US will be deemed to have been given two days after the date of posting. However notices sent to a Participant in other countries will be deemed to have been given on the seventh day after the date of posting.

23.9 Notices sent by email or fax, in the absence of evidence to the contrary, will be deemed to have been received on the day after sending.

23.10 Any notice or other document required to be given to the Company under or in connection with the Plan may be delivered or sent by post to it at its registered office (or such other place or places as the Committee may from time to time determine and notify to Participants) or sent by email or fax to any email address or fax number notified to the sender.

No transfer of Awards or Deferred Performance Shares

23.11 A Participant may not transfer, assign, charge or otherwise dispose of any Awards or Deferred Performance Shares, or any rights in respect of them, except on the transmission of Awards or Deferred Performance Shares on the death of a Participant to his personal representatives or the assignment of an Award or Deferred Performance Shares, with the prior consent of the Committee, subject to any terms and conditions the Committee imposes. Any such attempted transfer will result in the lapse of the Award or Deferred Performance Shares as applicable.

Awards non-pensionable

23.12 Awards and Dividend Equivalents under the Plan are not pensionable.

Payment of Stamp Duty

23.13 The Company, or where the Committee so directs any member of the Group, will pay the appropriate stamp duty on behalf of Participants in respect of any transfer of Shares on the Vesting of Awards and/or Deferred Performance Shares.

Data Protection

23.14 By accepting the grant of an Award, a Participant consents to the holding and processing of personal data provided by him to the Company, a Qualifying Company or any member of the Group, and any other persons for all purposes related to the

Page 16

operation of the Plan and acknowledges that the personal information may be transferred to, and stored at, a destination outside the European Economic Area (“EEA”), and may also be processed by staff operating outside the EEA who work for the Company, a Qualifying Company, a member of the Group or for one of their service providers. The Company will take all steps reasonably necessary to ensure that a Participant’s personal data is treated securely under appropriate contractual arrangements.

Governing Law

23.15 This Plan will be governed by, and construed in accordance with, the laws of England.

Page 17

SCHEDULE 1

Performance Conditions

General

1. The following provisions shall apply to Awards granted under the Plan.

2. Performance targets applicable to the Performance Share Award will be measured after the end of the 2012 financial year of the Qualifying Companies and the performance targets applicable to the Matching Share Award will be measured after the end of the 2014 financial year of the Qualifying Companies.

3. There are three separate measures: a Relative Total Shareholder Return measure ( TSR Measure) , a Return on Invested Capital measure ( ROIC Measure ) and an Adjusted Earnings per Share measure ( EPS Measure ).

4. The determination of vesting levels under the three measures is subject to the Cap.

The TSR Measure

5.1 The vesting of one third of the Performance Share Award is subject to the TSR ranking of Reed Elsevier measured over the three financial years of the Qualifying Companies 2010 to 2012 and the vesting of one third of the Matching Share Award is subject to the TSR ranking of Reed Elsevier measured over the five financial years of the Qualifying Companies 2010 to 2014. In respect of each type of award the portion subject to the TSR Measure is referred to as the “ TSR Tranche ”.

5.2 Three distinct comparator groups will be used — a Sterling Comparator Group, a Euro Comparator Group and a US Dollar Comparator Group. The TSR performance of RE PLC ordinary shares (based on RE PLC’s London listing) will be measured against the Sterling Comparator Group, the TSR performance of RE NV ordinary shares (based on RE NV’s Amsterdam listing) will be measured against the Euro Comparator Group; and the TSR performance of RE PLC ADRs and RE NV ADRs (based on the New York listing) will be measured against the US Dollar Comparator Group. The TSR performance will be measured separately against each comparator group and each ranking achieved will produce a payout, if any, in respect of one third of the TSR Tranche. The proportion of the TSR Tranche that vests will be the sum of the payouts achieved against the three comparator groups.

5.3 TSR will be measured in local currency.

5.4 Total Shareholder Return for any company shall be the percentage increase or decrease in the market value of a share over the relevant performance period and shall take account of dividends and other distributions paid in the course of that period (each such dividend being deemed to be reinvested in the shares of each relevant company from the date of payment of the dividend to the last day of the relevant performance period),

5.5 Each comparator group comprises companies which were selected on the following basis: -

Page 18

	•		they are included in a relevant market index as at 31 December 2009— FTSE100 for the Sterling Comparator Group; Euronext100 and the DAX30 for the Euro Comparator Group; and the S&P500 for the US Dollar Comparator Group;

	•		are nearest in size to Reed Elsevier in terms of market capitalisation;

excluding:

	•		companies with mainly domestic revenues (as they do not reflect the global nature of the Qualifying Companies’ customer base);

	•		those engaged in extractive industries (as they are exposed to commodity cycles); and

	•		financial services companies (as they have a different risk/reward profile).

Relevant listed global peers operating in businesses similar to those of Reed Elsevier not otherwise included are added to the relevant comparator group.

Set out below are the comparators included in each group:


STERLING		US DOLLAR COMPARATOR
COMPARATOR GROUP	EURO COMPARATOR GROUP	GROUP
AGGREKO	ACCOR	3M
ASTRAZENECA	ADIDAS	ADOBE SYSTEMS
AUTONOMY CORP.	AHOLD	AGILENT TECHS.
BAE SYSTEMS	AIR LIQUIDE	AIR PRDS. & CHEMS.
BRITISH AIRWAYS	AKZO NOBEL	AMAZON.COM
BRITISH AMERICAN TOBACCO	ALSTOM	ANALOG DEVICES
BUNZL	ASML HOLDING	APPLIED MATS.
BURBERRY GROUP	BASF	AVON PRODUCTS
COBHAM	BMW	BAXTER INTL.
COMPASS GROUP	CARREFOUR	BECTON DICKINSON
DMGT	CHRISTIAN DIOR	CATERPILLAR
DIAGEO	DAIMLER	COLGATE-PALMOLIVE
EXPERIAN	DEUTSCHE POST	CORNING
GLAXOSMITHKLINE	EADS	CUMMINS
INTERCONTINENTAL HOTELS	ESSILOR INTL.	DEERE
IMPERIAL TOBACCO GROUP	HEINEKEN	DOW CHEMICAL
INFORMA	HERMES INTL.	DUN & BRADSTREET
INMARSAT	K + S	E. I. DU PONT DE NEMOURS
INTERNATIONAL POWER	LAFARGE	EBAY
INTERTEK GROUP	LAGARDERE GROUPE	EMERSON ELECTRIC
INVENSYS	LINDE	FICO
JOHNSON MATTHEY	LVMH	FORD MOTOR
KINGFISHER	MAN	GENZYME
NATIONAL GRID	METRO	H.J. HEINZ
PEARSON	MICHELIN	ILLINOIS TOOL WORKS
RECKITT BENCKISER GROUP	PERNOD-RICARD	JOHN WILEY
REXAM	PHILIPS ELTN. KONINKLIJKE	JOHNSON CONTROLS
ROLLS-ROYCE GROUP	PORTUGAL TELECOM SGPS	JUNIPER NETWORKS
SABMILLER	PPR	LIFE TECHNOLOGIES
SAGE GROUP	RENAULT	MCDONALDS
SHIRE	SAINT-GOBAIN	MCGRAW-HILL
SMITH & NEPHEW	SAP	MICRON TECHNOLOGY

Page 19


STERLING		US DOLLAR COMPARATOR
COMPARATOR GROUP	EURO COMPARATOR GROUP	GROUP
SMITHS GROUP	SCHNEIDER ELECTRIC	MOTOROLA
THOMAS COOK GROUP	SUEZ ENVIRONNEMENT	NEWS CORP
TUI TRAVEL	THALES	NIKE
UNILEVER (LSE)	THYSSENKRUPP	NVIDIA
UNITED BUSINESS MEDIA	TNT	PACCAR
VODAFONE	UNILEVER (AEX)	PPG INDUSTRIES
WOLSELEY	VALLOUREC	SPECTRA ENERGY
WPP	VEOLIA ENVIRONNEMENT	TEXAS INSTS.
	VOLKSWAGEN	THOMSON REUTERS (NYSE)
	WOLTERS KLUWER	UNITED TECHNOLOGIES
		YUM! BRANDS

5.6 Any changes in the comparators groups as a result of delisting or consolidation will be treated in accordance with the methodology agreed by the Committee at its sole discretion from time to time. In determining the methodology to be applied, the Committee will have due regard to market practice, ensure a consistent application of the agreed methodology and be open and transparent about the methodology applied.

5.7 The TSR ranking against the US Dollar Comparator Group will be calculated using the weighted average of the TSRs of the RE PLC ADRs and the RE NV ADRs over the relevant period of measurement.

5.8 The number of Shares in each third of the TSR Tranche which are capable of Vesting will be calculated as follows and will be added together to determine the total number of Performance Shares and Matching Shares, within the TSR Tranche of each type of Award, which are capable of Vesting:


	Performance Share			Matching Share
	Awards —			Awards —
	performance			performance
	measured to the end			measured to the end
	of 2012			of 2014
TSR ranking within	Vesting percentage of			Vesting percentage of
the relevant TSR	each third of the TSR			each third of the TSR
comparator group	Tranche			Tranche
Below Median		0	%		0	%
Median		30	%		30	%
Upper quartile (top 25 ^th percentile)		100	%		100	%

5.9 Vesting is on a straight-line basis for ranking between median and upper quartile. 50% of the Shares comprised in a Performance Share Award that are capable of Vesting will be designated as Deferred Performance Shares and will only Vest as provided for by the Rules.

5.10 The averaging period applied for TSR measurement purposes for the Performance Share Award is the six months before the start of the financial year of the Qualifying Companies in which the Performance Share Award is granted and the last six months of the financial year of the Qualifying Companies ending 31 December 2012. In respect of the Matching Share Award, the averaging period applied for TSR measurement purposes is the six months before the start of the financial year of the Qualifying Companies in which the Performance Share Award is

Page 20

granted and the last six months of the financial year of the Qualifying Companies ending 31 December 2014.

The ROIC Measure

6.1 The Vesting of one third of the Performance Share Award and one third of the Matching Share Award relates to the percentage return on invested capital of the combined businesses of the Qualifying Companies. The vesting of the Performance Share Award relates to the percentage ROIC of the combined businesses of the Qualifying Companies for the financial year of the Qualifying Companies ending 31 December 2012 and is subject to the 2012 ROIC exceeding the 2009 ROIC, calculated on the same basis. The Matching Share Award is subject to the percentage ROIC of the combined businesses of the Qualifying Companies for the financial year of the Qualifying Companies ending 31 December 2014. In respect of each type of award, the portion subject to the ROIC Measure is referred to as the ‘ ROIC Tranche ’.

6.2 The following definitions are relevant for ROIC:

	(i)		Invested capital = arithmetic average of the opening and closing capital employed stated before financing and tax balances for the combined businesses of the Qualifying Companies adjusted for major acquisition timing for the financial year with all cumulative amortisation and impairment charges for acquired intangible assets and goodwill added back and excluding the gross up to goodwill in respect of deferred tax liabilities established on the acquisition of intangible assets retranslated at the average and hedge exchange rates applicable to the financial year ended 31 December 2009. In addition, any exceptional restructuring and acquisition related charges (net of tax) over the performance period are capitalised for these purposes and the effect of changes in exchange rates and movements in the net pension deficits are excluded.

	(ii)		Return = adjusted operating profit for the combined businesses of the Qualifying Companies before amortisation and impairment of acquired intangible assets and goodwill, exceptional restructuring and acquisition related charges and grossed up to exclude the equity share of taxes in joint ventures and further adjusted to exclude movements in the net pension financing credit, after applying the effective rate of tax used for adjusted earnings calculations and using exchange rates to match those used in the calculation of invested capital.

In order to ensure that the performance score achieved is a fair reflection of underlying business performance, the Committee retains discretion to determine the treatment of major disposals and acquisitions that require Board approval. Any significant adjustments made to the final performance score will be disclosed to shareholders.

Page 21

6.3 The number of Performance Shares and Matching Shares comprised in the ROIC Tranche of each type of award which are capable of Vesting will be determined as follows:


Performance Share	Matching Share
Awards — performance	Awards — performance
measured in respect	measured in respect	Vesting percentage of
of 2012	of 2014	ROIC Tranche
ROIC	ROIC
Below 10.2%	Below 10.7%	0%
10.2%	10.7%	60%
11.2% or above	12.7% or above	100%

6.4 Vesting is on a straight-line basis for performance between the minimum and maximum levels. 50% of the Shares comprised in a Performance Share Award that are capable of Vesting will be designated as Deferred Performance Shares and will only Vest as provided for by the Rules.

The EPS Measure

7.1 The vesting of one third of the Performance Share Award relates to the average growth in Adjusted Earnings per Share at constant currencies (Adjusted EPS) of the Qualifying Companies over the two financial years of the Qualifying Companies, 2011 and 2012. However, for any part to vest, Average Adjusted EPS Growth must be positive over the three financial years of the Qualifying Companies ending 31 December 2012. The vesting of one third of the Matching Share Award is subject to Adjusted EPS over the two financial years 2013 and 2014. In respect of each type of Award, the portion subject to the EPS Measure is referred to as the ‘ EPS Tranche ’.

7.2 The following definitions apply in respect of Adjusted EPS:

	(i)		Adjusted EPS Growth = the arithmetic mean of the growth in Adjusted EPS at constant currencies achieved by the Qualifying Companies over a relevant financial year;

	(ii)		Average Adjusted EPS Growth = the average of the Adjusted EPS Growth over the relevant period of measurement;

	(iii)		Adjusted Earnings = adjusted reported earnings. Adjustments include amortisation and impairment of acquired intangible assets and goodwill, exceptional restructuring and acquisition related charges, gains/losses on business disposals and other non-operating items, related tax effects and movements in deferred tax balances not expected to crystallise in the near term. The Committee retains discretion to adjust for changes in the net pension financing credit;

	(iv)		Adjusted Earnings Per Share = Adjusted Earnings divided by the Number of Shares

Page 22

	(v)		Number of Shares = weighted average number of shares in issue excluding shares held in treasury or by the Reed Elsevier Group plc Employee Benefit Trust; and

	(vi)		Constant currencies = refers to measurement at constant rates of exchange using the prior full year average and hedge rates.

7.3 The number of Performance Shares/Matching Shares in the EPS Tranche of each type of award which are capable of Vesting will be determined as follows:


Performance Share Awards	Matching Share Awards
— performance measured in	— performance measured in	Vesting percentage
respect of 2011 and 2012	respect of 2013 and 2014	of EPS Tranche
Average Adjusted EPS Growth	Average Adjusted EPS Growth
Below 5% per annum	Below 7% per annum	0%
5% per annum	7% per annum	60%
9% or above per annum	13% or above per annum	100%

7.4 Vesting is on a straight-line basis for performance between the minimum and maximum levels. 50% of the Shares comprised in a Performance Share Award that are capable of Vesting will be designated as Deferred Performance Shares and will only Vest as provided for by the Rules.

Determining satisfaction of targets at end of performance period

8.1 The performance period for the Performance Share Award are the financial years of the Qualifying Companies 2010 to 2012, with performance being determined in respect of this Award after the end of the 2012 financial year of the Qualifying Companies. The performance period for the Matching Share Award are the financial years of the Qualifying Companies 2013 and 2014 in respect of the EPS and ROIC Tranches of the Award and the five financial years ending 31 December 2014 in respect of the TSR Tranche. Performance in respect of this Award will be determined after the end of the 2014 financial year of the Qualifying Companies.

8.2 Following the end of the relevant Performance Period the Committee shall:

	(a)		calculate and confirm with the Auditors the Adjusted EPS and ROIC over the relevant Performance Periods; and

	(b)		arrange for a reputable provider of such information to calculate and report to the Committee on the TSR performance. If at the end of the relevant Performance Period, any of the companies in the comparator groups have undergone a change in circumstances (such as delisting, the cessation of trading or merger with another company) the Committee may determine the appropriate treatment for such companies in

Page 23

accordance with its stated methodology for the purpose of determining its TSR and TSR ranking.

Adjustments

9. The Committee may make such adjustments to the performance conditions applicable to outstanding Awards as it considers appropriate to take account of any factors which are relevant in the opinion of the Committee and in particular if there is an event which causes it to consider that the performance conditions are no longer a fair measure of performance. The amended performance conditions shall be at least as challenging as the one originally set.

10. The Committee has discretion to adjust the definition or method of calculation of Adjusted EPS and ROIC (or any other applicable term or measure) as set out in this Schedule to take account of any changes in recognised accounting standards or practice, fiscal regime or capital structure, to ensure consistent measurement and accountability.

11. Without prejudice to the generality of paragraphs 9, 10 and 12, the Committee may, in consultation with the Auditors, make the following adjustments in relation to the calculations to be carried out in accordance with this Schedule:

	(a)		any adjustments it considers appropriate if an event occurs giving rise to an adjustment of Awards under Rule 19 of the Plan;

	(b)		any adjustments it considers appropriate to the calculation of TSR for each of the companies in the Comparator Group to take account of local market factors; and

	(c)		any adjustments it considers appropriate if there is any modification in the calculation of TSR or in relation to the relevant international accounting standard used to calculate EPS or ROIC.

Overriding Power

12. In determining the level of vesting of any Award under the Plan, the Committee will take into account the overall business performance of RE PLC, RE NV and the Group over the relevant performance period and any other factors that it considers appropriate and may modify the vesting of awards if it considers that such a modification would result in a fairer outcome.

Page 24

SCHEDULE 2

US Participants

This Schedule was adopted by the directors of Reed Elsevier Group plc on 21 April 2010.

The Rules of the Plan apply to Awards and Deferred Performance Shares granted to US Participants under this Schedule subject to the modifications contained in this Schedule.

	(A)		In this Schedule, terms shall have the same meaning as in Rule 1 of the Rules unless modified by this Schedule.

	(B)		*Retirement* . Rule 1 is revised by the addition of the following definition of “Retirement” for US Participants:

			*Retirement* means, for purposes of the Vesting of Awards under this Schedule in relation to a US Participant (including the Vesting of Deferred Performance Shares), circumstances which the Committee determines on a case by case basis and in its absolute discretion to constitute retirement (irrespective of whether or not applicable retirement eligible criteria have been met);

	(C)		*US Participant* . Rule 1 is revised by the addition of the following definition of “US Participant”:

			*US Participant* means a Participant who is subject to United States taxation by reason of being a United States national, or resident in the United States for United States tax purposes;

	(D)		*Release of Shares.* Rules 8.2, 8.3, and 11.2 shall have the additional requirement that the Shares shall be transferred to the US Participant by 15 March of the calendar year following the calendar year in which Vesting occurs.

	(E)		*Dividend Equivalent — Cash Payment.* Rule 12.1 shall have the additional requirement that any cash payment to the US Participant under this Rule shall in all instances be released no later than March 15 of the year following the year in which Vesting occurs.

	(F)		*Dividend Equivalent — Shares in Lieu of Cash.* Rule 12.3 shall have the additional requirement that if the Committee determines that it shall satisfy an entitlement to Dividend Equivalents arising in accordance with Rule 12.1 by delivering Shares with an equivalent value, such Shares shall be transferred to the US Participant within 30 days of the relevant date of Vesting.

	(G)		*Cessation of Employment (Approved Leavers — Rule 13.4).* If Rule 13.4 applies to a US Participant, such US Participant’s Deferred

Page 25

Performance Shares will Vest on the Termination Date and the Company shall procure the transfer of Shares deliverable to the US Participant by 15 March of the calendar year following the calendar year in which the Participant’s Termination Date occurs.

	(H)		*Cessation of Employment (Approved Leavers — Rule 13.5)* . If Rule 13.5 applies to a US Participant, such US Participant’s pro-rated Deferred Performance Shares will Vest on the Termination date and the Company shall procure the transfer of Shares deliverable to the US Participant by 15 March of the calendar year following calendar year in which the Participant’s Termination Date occurs.

	(I)		*Cessation of Employment (Approved Leavers — Rule 13.6)* . If Rule 13.6 applies to a US Participant, the Company shall procure the transfer of the pro-rated Shares deliverable to the US Participant by 15 March of the calendar year following the calendar year in which the Award Vesting occurs.

	(J)		*Cessation of Employment (Death)* . If Rule 13.9 or 13.10 applies to a US Participant, the Company shall procure the transfer of Shares deliverable to the US Participant’s personal representative under Rule 13.9 or 13.10 (as the case may be) no later than 15 March of the calendar year following the calendar year in which the US Participant’s death occurs.

	(K)		*Change of Control/Voluntary Winding Up.* In any instance in which Rules 15, 16 or 18 apply to a US Participant, the Company shall procure the transfer of Shares deliverable to the US Participant by 15 March of the calendar year following the calendar year in which Vesting occurs.

	(L)		*Application of Code Section 409A.* Although neither the Committee nor any member of the Group guarantees any particular tax treatment to a US Participant, Awards and Deferred Performance Shares granted pursuant to this Schedule are intended to be exempt from Section 409A of the Code under the exception for short-term deferrals set forth in Section 1.409A-1(b)(4) of the United States Income Tax Regulations (which requires, in the case of an employer with a fiscal year ending 31 December, that Shares in payment of an award be transferred to the US Participant no later than March 15 of the calendar year following the calendar year in which the Award or Deferred Performance Share is no longer subject to a substantial risk of lapsing) and shall be limited, construed and interpreted in accordance with such intent.

Page 26

Exhibit 4.5

REED ELSEVIER GROUP PLC

RULES OF THE LEXIS-NEXIS
RISK & INFORMATION ANALYTICS GROUP
LONG TERM INCENTIVE PLAN

(Adopted by the
Reed Elsevier Group plc Remuneration Committee
on 24 June 2009)

THE REED ELSEVIER GROUP PLC
LEXIS-NEXIS RISK & INFORMATION ANALYTICS GROUP
LONG TERM INCENTIVE PLAN

1. Definitions

1.1 In this Plan, unless the context otherwise requires, the following words and expressions shall have the following meanings, namely:

Adoption Date means 24 June 2009;

Award means a conditional right to acquire Shares without payment under the rules of this Plan and for these purposes:

(a)		*Award — Initial Number* means the number of Shares under an Award prior to the application of the performance condition in the Schedule; and

(b)		*Award — Maximum Number* means the maximum number of Shares which could vest under an Award upon application of the performance condition in the Schedule;

Board means the Board of Directors of the Company;

the Company means Reed Elsevier Group plc;

Control has the meaning given to that word by section 840 of the Taxes Act;

Date of Grant means the date on which an Award is granted;

Dutch Share means an ordinary share in the capital of RE NV or shares representing those shares following any Capital Reorganisation of RE NV;

Employment means employment with any member of the Group;

Executive means any employee of any member of RIAG whose terms of service require him to devote substantially the whole of his working time to the affairs of RIAG and shall not include any executive directors of a Qualifying Company;

Financial Year means an accounting reference period as defined in accordance with section 391 of the Companies Act 2006;

Grant Period means the period of 42 days commencing on any of the following:

(a)

the release of the Qualifying Companies’ interim (half-yearly) and/or final results in any year;

(b)		the release by the Qualifying Companies of any trading update or (if applicable to the Qualifying Companies at the time) their quarterly results for any year; or

(c)		the day on which the Remuneration Committee resolves that exceptional circumstances exist which justify the grant of Awards;

the Group means the Company and every company which is under the Control of the Company and member of the Group shall be construed accordingly;

Market Value means:

(a)		in the case of a UK Share, the closing middle market quotation for a UK Share as derived from the Daily Official List of the London Stock Exchange on the Date of Grant; and

(b)		in the case of a Dutch Share, the closing price for a Dutch Share on the Amsterdam Stock Exchange on the Date of Grant;

Participant means any current or former Executive who holds a subsisting Award (this shall include, where the context permits, the legal personal representatives of a deceased Participant);

Performance Period means the period of three Financial Years of the Company commencing with the Financial Year in which the Date of Grant of an Award falls;

the Plan means this Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan as amended from time to time;

Qualifying Company means each of RE PLC and RE NV;

RE NV means Reed Elsevier NV;

RE PLC means Reed Elsevier PLC;

Redundancy means a dismissal of the Participant wholly or mainly attributable to the fact his employer has ceased or intends to cease to carry on the business for the purposes of which the Participant was employed by him, or to carry on that business in the place where the Participant was so employed, or the fact that the requirements of that business for employees to carry out work of a particular kind, or for employees to carry out work of a particular kind in the place where the Participant was employed by his employer, have ceased or diminished or are expected to cease or diminish;

the Remuneration Committee means the remuneration committee of the Board;

Retirement means cessation of Employment in circumstances which the Committee regards as retirement (whether at normal retirement age or at any other age);

RIAG means those businesses that comprise the Risk & Information Analytics Group of the Group’s Lexis-Nexis division;

Sale of Business means, subject to the Remuneration Committee determining otherwise, the sale of all or substantially all of the assets of the business or division to

which the Participant is assigned or the sale of all or substantially all of the shares in the company by which the Participant is employed in either case to a person who is not controlled by Reed Elsevier Group plc;

Shares means a UK Share and/or a Dutch Share and Shareholder shall be construed accordingly;

Taxes Act means the Income and Corporation Taxes Act 1988;

the Trustees means the trustees for the time being of any appropriate employee benefit trust established by the Company or any member of the Group from time to time for the benefit of (among others) employees of the Group;

UK Share means an ordinary share in the capital of RE PLC or shares representing those shares following any Capital Reorganisation of RE PLC;

US Participant means a Participant who is subject to United States taxation by reason of being a United States national or resident in the United States for United States tax purposes.

Vesting Date means the date on which an Award vests under rule 4.2, or such earlier date on which an Award vests in accordance with these rules; and

Vesting Shares means the number of Shares under an Award that actually vest upon application of the performance condition imposed under rule 2.3.

1.2 Where the context permits the singular shall include the plural and vice versa and the masculine shall include the feminine. Headings shall be ignored in construing the Plan.

1.3 References to any act of Parliament are to UK legislation and shall include any statutory modification, amendment or re enactment thereof.

2. Grant of Awards

2.1 The Remuneration Committee may grant Awards to Executives selected by the Remuneration Committee in its absolute discretion during a Grant Period. For the avoidance of doubt, no Executive shall have the right or expectation to participate in the Plan in any Grant Period.

2.2 On granting Awards, the Company shall enter into a deed poll or take such other steps as are necessary to evidence their legal enforceability.

2.3 Save as otherwise permitted in these rules, objective conditions must be satisfied prior to the vesting of Awards. Subject to the Remuneration Committee’s power to impose different conditions on the grant of an Award from time to time, such conditions shall, for Awards granted in 2009 and thereafter, consist of the conditions set out in the Schedule to this Plan. There will be no retesting of such conditions.

2.4 The grant of an Award and/or the delivery of Shares upon vesting thereof shall be conditional on the Executive agreeing to comply with any arrangements specified by the Company for the payment of taxation and social security contributions

(including without limitation the right to sell on his or her behalf sufficient Shares to satisfy any taxation or social security contributions liability on his or her part for which any member of the Group may be liable) in respect of an Award.

2.5 As soon as practicable after the Date of Grant the Remuneration Committee shall procure the issue to each Executive of a letter in respect of the Award together with access to website information, or such other information as the Remuneration Committee shall make available, summarising the key terms of the Award.

2.6 Each Participant shall be required to acknowledge the right of the Remuneration Committee to reduce or cancel Awards pursuant to its powers set out in the Schedule to this Plan.

2.7 Any Executive to whom an Award is granted may, by notice in writing to the Company given within 30 days after the Date of Grant, renounce in whole or in part his or her rights under the Award. In such a case, the Award shall, to the extent renounced, be treated as never having been granted and (if already issued) the relevant certificate(s) shall be returned to the Company for cancellation or amendment. No consideration shall be payable by the Company for any such renunciation.

2.8 No Award shall be granted under the Plan later than the fifth anniversary of the Adoption Date.

2.9 Every Award granted hereunder shall be personal to the Participant and, except to the extent necessary to enable a personal representative to exercise the Award following the death of a Participant, neither the Award nor the benefit thereof may be transferred, assigned, charged or otherwise alienated. Any transfer of an Award otherwise than as permitted under this rule 2.9 shall cause the Award to lapse.

3. Plan and Individual Limits

Any limit on the number of Shares granted under Awards to any Executive shall be set by the Remuneration Committee from time to time.

4. Specific Provisions Relating to Awards

4.1 An Award consists of a right to receive a number of Shares (not exceeding the Award - Maximum Number) following the Vesting Date.

4.2 The number of Shares that vest under an Award (that is, the Vesting Shares) shall be determined by the Remuneration Committee based on the extent to which the performance conditions imposed under rule 2.3 have been fulfilled or waived in accordance with these rules. Such determination shall be made within 30 days of the preliminary announcement of results for the last Financial Year in the Performance Period, or such earlier date as is required under these rules (such date being the Vesting Date). The 30 day period shall be extended by such period as the Remuneration Committee determines in the event that the Company’s share dealing code (or the Model Code) would otherwise prohibit a release of Shares.

4.3 Subject to rule 14.1, the Remuneration Committee shall make arrangements to transfer Vesting Shares to Participants in satisfaction of their entitlements under Awards as soon as practicable following the Vesting Date PROVIDED THAT, in all instances, Vesting Shares shall be transferred to US Participants on or before March

15 of the year following the year in which such Shares have vested, in each case subject to any sale of Shares in accordance with rule 2.4.

5. Entitlement to Notional Dividends

5.1 In addition to any Vesting Shares to which a Participant becomes entitled in relation to an Award in accordance with the rules of this Plan, the Participant shall also be entitled to a cash payment equal to the dividends (excluding any associated UK tax credit thereon) which would have been paid on the Vesting Shares during the Performance Period.

5.2 The cash payment to which the Participant becomes entitled under rule 5.1:

(a)		shall be calculated (in such manner as the Remuneration Committee thinks fit) by reference to the currency of payment of the underlying dividend (and paid in such currency as the Remuneration Committee thinks fit);

(b)		shall be calculated without any entitlement to interest (or other type of investment return) in the period between the dividend payment date and the Vesting Date; and

(c)		shall be paid (subject to such deductions as are required by law) within one month of the Vesting Date.

5.3 For the avoidance of doubt, the payment referred to in rule 5.1 does not represent an entitlement to actual dividends on the underlying Shares, by reason of the Participant not being beneficial owner of the Vesting Shares at that time.

5.4 For the avoidance of doubt, if a Participant’s Award lapses, any right of a Participant to a cash payment under rule 5 shall automatically lapse on the date the related Award lapses.

6. Vesting and Lapse of Awards — Cessation of Employment

6.1 Save as otherwise provided in these rules, in the event that the Participant ceases or will cease to be an employee of a member of the Group:

(a)		by reason of resignation, the Award shall lapse automatically on the date on which the Participant gives notice of the termination of his Employment; and

(b)		for any reason where (a) does not apply, the Award shall lapse automatically on the date of the cessation of Employment.

6.2 Save as otherwise provided in these rules, where a Participant ceases to be an employee of a member of the Group by reason of:

(a)		death;

(b)		long term disability;

(c)		Retirement;

(d)		Redundancy;

(e)		Sale of Business; or

(f)		any other reason if the Remuneration Committee so decides in its absolute discretion

then an Award shall continue and shall vest following maturity of the Award (when the vesting level of the Award will have been determined). The number of Shares in respect of which the Award vests shall be multiplied by A/36 where A is the number of complete months from the commencement of the Performance Period to the date of cessation of Employment PROVIDED THAT the Remuneration Committee may in its absolute discretion determine that the Participant’s entitlement should not be scaled down or scaled down in part only (the extent of scaling down being determined by the Remuneration Committee in its absolute discretion) and PROVIDED FURTHER THAT if the reason for cessation is the Participant’s death the Remuneration Committee shall, and for all other reasons for cessation the Remuneration Committee may, release Shares equal to the Award — Initial Number, but subject to scaling down and the exercise by the Remuneration Committee of its discretion as aforesaid. If the Remuneration Committee releases Shares to a US Participant prior to maturity in accordance with this Rule, the Remuneration Committee shall, subject to any necessary consents and subject to compliance by the US Participant’s personal representative (in the case of the US Participant’s death) or by the US Participant, as the case may be, with the terms of the Plan, either allot and issue, or procure the transfer of Shares to the US Participant’s personal representative or to the US Participant (or to his nominee), as the case may be, within 30 days after the US Participant’s date of death or Termination Date and in all instances on or before March 15 of the year following the year in which the Termination Date has occurred.

6.3 For the purposes of rules 6.1 and 6.2 a female Participant shall not be treated as ceasing to be an employee of a member of the Group if absent from work wholly or partly because of pregnancy or confinement until she ceases to be entitled to exercise any statutory or contractual right to return to work.

6.4 For the purposes of rules 6.1, 6.2 and 6.3 following an Award rollover pursuant to rule 12, a Participant shall not be treated as ceasing to be employed by a member of the Group until he ceases to be employed by a company which is either (i) the Acquiring Company (as defined in rule 12) or (ii) a subsidiary of the Acquiring Company (within the meaning of section 1159 and Schedule 6 of the Companies Act 2006).

7. Engagement in post-termination competitive activity

If a Participant:

(a)		resigns from employment with a member of the Group, or is dismissed from employment with a member of the Group in circumstances justifying summary termination or termination for “Cause” under any contract that the Participant may have with his Group employer, and

(b)		within twelve months of the date of termination of his employment (the *Termination Date* ), becomes an employee of a Competitor Company (as defined in this rule 7) and his employment with that company results in his material involvement in one or more businesses that compete with any

business carried on by a member of the Group in which he had been involved in the twelve months prior to the Termination Date,

he must pay to the Company, within seven days of written demand from the Company, the Relevant Amount.

The Relevant Amount is an amount equal to A minus B minus C where:

A is an amount equal to the pre-tax gain realised by the Participant on the vesting of any Award in the period of six months prior to the Termination Date. For these purposes, the gain shall be the market value of the Shares on the Vesting Date of the Award, and such gain shall be determined irrespective of whether the Participant has sold or retained the Shares so acquired;

B is an amount equal to the tax and social security liabilities incurred by the Participant on the vesting of the Award; and

C is any payment of the Claw-back Amount (as defined in clause 8.2 below) determined in accordance with clause 8.1(c) under an Award which vested in the six months prior to the Termination Date.

A Competitor Company shall mean any of those companies notified to the Participant from time to time.

By accepting an Award, a Participant shall be bound by this rule 7 notwithstanding that (i) it shall only be applicable after the release of Shares under rule 14, and (ii) whether or not the essential terms of this rule 7 shall have been separately notified in writing by the Company to each Participant.

8. Award determined on the basis of materially mis-stated data

8.1 If the Committee, within two years after the Vesting Date of an Award, considers in good faith that the vesting of the Award was determined on the basis of materially misstated financial or other data (the Incorrect Award ), it shall, unless determined otherwise at the sole discretion of the Committee, recover the Claw-back Amount (as defined in rule 8.2 below) by taking one or more of the following actions:

(a)		reduce any future grants of Awards by the Claw-back Amount (or the balance thereof);

(b)		reduce any outstanding unvested Awards by the Claw-back Amount (or the balance thereof); and

(c)		require the individual to pay to the Company, within thirty days of a written demand from the Company, the Claw-back Amount (or the balance thereof).

8.2 The Claw-back Amount shall be the difference in value between the Incorrect Award and the Award that would have vested had the correct data been used as determined by the Committee acting fairly and reasonably and may be expressed as a number of Shares or a monetary amount or a combination thereof as the Committee considers appropriate. In determining the Claw-back Amount, the Committee may take into account such matters as it sees fit including, but not limited to:

(a)		the difference between the number of Shares under the Incorrect Award and the number of Shares the Committee considers should have vested had the correct data been used;

(b)		any gain made by the Participant on the sale of Shares comprised in the Incorrect Award;

(c)		any tax and / or dealing costs incurred by the Participant in connection with the Incorrect Award, and

(d)		whether the Participant has made a payment pursuant to rule 7 which would take account of Shares under an Incorrect Award.

9. General Offer

9.1 If any person (either alone or together with any person acting in concert with him) obtains Control of a Qualifying Company as a result of a general offer to acquire the whole of the share capital of that Qualifying Company (other than those shares which are already owned by him and/or any person acting in concert with him), in respect of Shares in that Qualifying Company which are under the Award (but not in respect of Shares in the other Qualifying Company which are or may be under the Award), Awards shall vest if and to the extent that the performance conditions imposed under rule 2.3 are met over the foreshortened period ending on the date of change of Control (subject to modification if the Committee considers that the performance conditions would be met to a greater or lesser extent at the end of the Performance Period).

9.2 Any Shares which vest pursuant to rule 9.1 shall be released within 14 days of the change of Control. Such vesting shall be without prejudice either to the operation of rule 12 or to the continuance of the Award in respect of Shares in the other Qualifying Company which are or may be under the Award.

9.3 The provisions of rules 9.1 and 9.2 shall not apply in the event that either:

(a)		the person obtaining Control of a Qualifying Company is the other Qualifying Company or a company under the Control of the other Qualifying Company; or

(b)		the Qualifying Company remains under the ultimate Control of the Shareholders of RE PLC or RE NV immediately prior to the relevant transaction affecting the Qualifying Company.

9.4 The provisions of rules 9.1 and 9.2 shall apply mutatis mutandis in the event that any person (either alone or together with any person acting in concert with him) obtains Control of the Company PROVIDED THAT Awards shall not vest under this rule 7.4 in the event that either:

(a)		the person obtaining Control of the Company is RE PLC or RE NV or a company under the Control of one or both of them; or

(b)		the Company remains under the ultimate Control of the Shareholders of RE PLC or RE NV immediately prior to the relevant transaction affecting the Company.

In the event Awards vest under this rule 9.4, Awards over Shares in both Qualifying Companies shall vest.

10. Scheme of Arrangement

10.1 If a court shall direct that a meeting of the holders of UK Shares be convened pursuant to section 899 of the Companies Act 2006 for the purposes of considering a scheme of arrangement of RE PLC then a Participant’s Awards in respect of UK Shares (without prejudice to the continuance of the Award in respect of Dutch Shares) shall vest if and to the extent that the performance conditions imposed under rule 2.3 are met over the foreshortened period ending on the date on which the scheme of arrangement is sanctioned by the court (subject to modification if the Committee considers that the performance conditions would be met to a greater or lesser extent at the end of the Performance Period).

10.2 Without prejudice to the operation of rule 12, Awards in respect of UK Shares shall not without the consent of the Committee vest under the foregoing provisions if the purpose and effect of the scheme of arrangement is to create a new holding company for the Company or RE PLC, such company having substantially the same shareholders and proportionate shareholdings as those of the Company or RE PLC (as the case may be) immediately prior to the scheme of arrangement.

10.3 The provisions of rules 10.1 and 10.2 shall apply mutatis mutandis to Awards in respect of Dutch Shares in the event that RE NV is subject to a legal process under Dutch law which is considered by the Committee to be broadly equivalent to section 899 of the Companies Act 2006.

10.4 Shares that vest and are transferred to a US Participant pursuant to rule 10.1 shall in all instances be transferred to the US Participant on or before March 15 of the year following the year in which they have vested.

11. Voluntary Winding up

The provisions of rules 9.1, 9.2 and 9.4 shall apply mutatis mutandis in the event that notice is duly given of a resolution for a voluntary winding up of a Qualifying Company PROVIDED THAT , for the purposes of this rule 11, all references in rule 9 to a change of Control or to an offer becoming unconditional in all respects shall be treated as references to the date on which notice is given for the voluntary winding-up of a Qualifying Company.

12. Award Rollover

12.1 If any company (the Acquiring Company ) obtains Control of a Qualifying Company or of the Company as a result of an event referred to in rules 9 or 11, each Participant , may at any time within one month of the change of Control, with the agreement of the Acquiring Company, release any Award in respect of Shares in that Qualifying Company which has not lapsed (the Old Right ) in consideration of the grant to him of a new right (the New Right ) which in the opinion of the Committee and the Acquiring Company is equivalent to the Old Right but relates to shares in a different company (whether the Acquiring Company itself or another company in its group). The operation of this rule 12 on a change of Control of one Qualifying

Company shall not affect the continuance of the Award in respect of Shares in the other Qualifying Company which are or may be subject to the Award.

12.2 Subject to rule 12.3, any performance condition imposed under rule 2.3 in relation to the Old Right shall not apply to the New Right unless the Committee and the Acquiring Company consider that it should so apply (subject to such modifications as they see fit).

12.3 In the event that either:

(a)		the person obtaining Control of the Company or Qualifying Company is RE PLC or RE NV or a company under the control of one or both of them; or

(b)		the Company or Qualifying Company remains under the ultimate control of the Shareholders of RE PLC or RE NV immediately prior to the relevant transaction affecting the Company or Qualifying Company,

Awards shall automatically be exchanged for New Rights as set out in rule 12.1 and the performance conditions imposed under rule 2.3 shall continue to apply (subject to such modifications as the Committee sees fit).

12.4 Except to the extent consistent with the requirements of Section 409A of the United States Internal Revenue Code ( Code Section 409 ) for the deferral of compensation without penalty or additional tax, or unless an exception to the application of Code Section 409A applies, rule 12 shall not apply to any Award held by a US Participant if, at the time the election provided by rule 10 is available to the US Participant, the Award has vested. In such a case, the rules of the Plan shall apply to the Award without regard to rule 12.

13. Adjustment of Awards

In the event of:

	(i)		any Capital Reorganisation; or

	(ii)		the implementation by a Qualifying Company of a demerger or the payment by a Qualifying Company of a super-dividend which would otherwise materially affect the value of an Award

the definition of Shares and the number of Shares comprised in an Award in relation to the Shares in that Qualifying Company may be adjusted in such manner as the Committee may determine: PROVIDED THAT:

(a)		no adjustment shall take effect without the prior approval of, in respect of an Award under which Shares are to be transferred, the person holding the Shares to which the Award relates, (such approval not to be unreasonably withheld);

(b)		no adjustment shall be made pursuant to this rule (other than on a capitalisation issue) unless and until the auditors for the time being of the Company (acting as experts not arbitrators) shall have confirmed in writing to the Committee that such adjustment is in their opinion fair and reasonable.

14. Transfer of Shares on vesting of Awards

14.1 Subject to any necessary consents and to compliance by the Participant with the terms of the Plan, not later than 30 days after the Vesting Date, each Qualifying Company shall procure the transfer of Shares to the Participant (or to his nominee). Where the Shares are transferred to a nominee of the Participant, the Participant shall remain the beneficial owner of the Shares. Shares may not be issued or transferred from treasury to satisfy Awards.

14.2 Subject to rule 17.1 below, the Company may provide funds to the Trustees to enable the Trustees to purchase existing UK Shares for the purpose of the Plan, provided that no funds may be provided to enable the Trustees to acquire UK Shares if such an acquisition would result in the Trustees holding more than 5% of the ordinary share capital of the Company in issue at that time.

15. Rights Attaching to Shares Transferred Pursuant to Awards

15.1 All Shares transferred upon the vesting of an Award shall rank pari passu in all respects with the Shares in issue at the Vesting Date save as regards any rights attaching to such Shares by reference to a record date prior to the Vesting Date.

15.2 Any Shares acquired on vesting of Awards shall be subject to the articles of association of the relevant Qualifying Company from time to time.

16. Administration and Amendment

The decision of the Committee shall be final and binding in all matters relating to the Plan and the Board may at any time discontinue the grant of further Awards or amend the rules of the Plan in any way it thinks fit: PROVIDED THAT:

(a)		the Committee shall not make any amendment that would materially prejudice the interests of existing Participants except with their prior written consent; and

(b)		without prejudice to any provision of the Plan which provides for the lapse of an Award, the Committee may not cancel an Award unless the Participant agrees in writing to such cancellation.

17. General

17.1 Any member of the Group may provide money to the trustees of any trust or any other person 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 678 of the Companies Act 2006.

17.2 The rights and obligations of a Participant under the terms and conditions of his office or employment shall not be affected by his participation in the Plan or any right he may have to participate in the Plan. An individual who participates in the Plan waives all and any rights to compensation or damages in consequence of the termination of his office or employment with any company for any reason whatsoever insofar as those rights arise, or may arise, from his ceasing to have rights under or be entitled to exercise any Award under the Plan as a result of such termination or from

the loss or diminution in value of such rights or entitlements. If necessary, the Participant’s terms of employment shall be varied accordingly.

17.3 The existence of any Award shall not affect in any way the right or power of the Company or its shareholders to make or authorise any or all adjustments, recapitalisations, reorganisations or other changes in the Company’s capital structure, or any merger or consolidation of the Company, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

17.4 Any notice or other document required to be given under or in connection with the Plan may be delivered to a Participant or 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 Company to be appropriate. Notices sent by post shall be deemed to have been given on the day following the date of posting. Any notice or other document required to be given to the Company under or in connection with the Plan may be delivered or sent by post to it at its registered office (or such other place or places as the Committee may from time to time determine and notify to Participants).

17.5 Benefits under the Plan shall not be pensionable.

17.6 The Company, or where the Committee so directs any member of the Group, shall pay the appropriate stamp duty on behalf of Participants in respect of any transfer of Shares on the exercise of Awards.

17.7 These rules shall be governed by, and construed in accordance with, the laws of England.

18. Application of Code Section 409A.

Although neither the Remuneration Committee nor any member of the Group guarantees any particular tax treatment to a US Participant, Awards granted to US Participants pursuant to the Plan are intended to be exempt from Code Section 409A and shall be limited, construed and interpreted in accordance with such intent.

SCHEDULE

Performance conditions attaching to awards granted
in 2009

Subject to the additional conditions set out herein, the performance conditions applicable to Awards are:

(a)		the achievement of Total Adjusted Operating Profit, adjusted for Southside, over the Performance Period 2009-2011 of the combined RIAG businesses (including ChoicePoint) as approved by the Remuneration Committee as at the date of adoption of these Rules;

(b)		the achievement of the Return on Investment for the ChoicePoint acquisition, measured at the end of the Performance Period 2009-2011 as approved by the Remuneration Committee as at the date of adoption of these Rules.

Each condition shall have equal weighting in accordance with the payout scale set out below:

Payout Scale


Achievement (% of Target)		Payout (% of Target Award)
Below 90%		0%
90%		50%
91%		55%
92%		60%
93%		65%
94%		70%
95%		75%
96%		80%
97%		85%
98%		90%
99%		95%
100%		100%
101%		125%
102%		150%
103%		175%

Straight-line interpolation will apply between all points on the above scale.

The individual metrics will be uncapped but the overall payout is capped at 189% of “target”.

The following provisions apply for the purpose of determining (i) whether the conditions set out in this Schedule have been satisfied, and accordingly (ii) the number of Vested Shares as a percentage of the Award — Initial Number.

1. Definitions

In this Schedule, terms shall have the same meaning as in Rule 1 of the Rules and, unless the context otherwise requires, the following additional terms shall have the following meanings, namely:

Accounts means the consolidated accounts of each Qualifying Company for a Financial Year drawn up in accordance with International Financial Reporting Standards (applied consistently);

Accounts Date means the date on which Accounts are published or, if the Remuneration Committee so determines, the date of the preliminary announcement of final results for a Financial Year;

After-Tax Adjusted Operating Profit means the Total Adjusted Operating Profit, excluding interest costs, plus the acquisition-related synergies (per the Acquisition Model), and then subtracting 33% for tax;

Auditors means the auditors for the time being of each Qualifying Company;

Investment Base means the amount calculated by adding the total consideration paid for ChoicePoint to the debt acquired, the regulatory review expenses, and the integration expenses incurred during the Performance Period;

Return on Investment means After-Tax Adjusted Operating Profit for ChoicePoint for the Performance Period divided by the Investment Base;

Special Committee means the CEO LNG, SVP Finance — LNG and SVP Finance — LN RIAG; and

Total Adjusted Operating Profit means the adjusted operating profit before amortisation of acquired intangible assets and goodwill impairment, exceptional restructuring and acquisition related costs. Any variance from budgeted development and launch expenditure will be excluded for the purposes of determining performance.

2. Determining Satisfaction Of Targets At End Of Performance Period

At the Accounts Date of the Company following the expiry of the Performance Period, the Special Committee shall calculate and verify with the Auditors the Total Adjusted Operating Profit and the Return on Investment as defined in this Schedule.

3. Shareholding Condition

3.1 Notwithstanding satisfaction of the performance conditions, an Award shall not vest unless the Remuneration Committee is satisfied that the Participant complies with the Remuneration Committee’s shareholding guidelines for senior executives as at the Vesting Date.

3.2 For the purposes of the condition in paragraph 3.1 the Remuneration Committee shall have discretion to determine all matters relating to the satisfaction of the said condition, including the share price to be taken into account for these purposes.

4. Adjustments

4.1 The Remuneration Committee may make such adjustments to the performance conditions in this Schedule as it considers appropriate to take account of any factors which are relevant in the opinion of the Remuneration Committee.

4.2 Without prejudice to paragraph 4.1, the Remuneration Committee may, in consultation with the Auditors, make appropriate adjustments in relation to the calculations to be carried out in accordance with this Schedule.

5. Overriding Power

The Remuneration Committee may in its absolute discretion at any time reduce or cancel Awards previously granted to Participants based on the Remuneration Committee’s assessment of (a) whether the achieved level of performance is a fair reflection of the progress of the RIAG business having regard to underlying revenue growth, cash generation, return on capital and any significant changes in inflation, and (b) individual performance of a Participant. This power shall apply even if the Performance Conditions have been or are expected to be met.

Exhibit 4.6

RULES OF THE
REED ELSEVIER GROUP PLC LONG-TERM
INCENTIVE PLAN 2010

Adopted by the directors of Reed Elsevier Group plc on 21 April 2010

THE REED ELSEVIER GROUP PLC LONG-TERM INCENTIVE PLAN 2010

1. Definitions

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

Committee means the remuneration committee of the board of directors of the Company or other duly authorised committee;

Company means Reed Elsevier Group plc;

Control has the meaning given to it by section 995 of the Income Taxes Act 2007;

Date of Grant means the date on which a Performance Share Award is granted;

Dividend Equivalent means a right to a cash payment or Shares in accordance with Rule 5;

Employee means any employee of a member of the Group or a Qualifying Company;

Group means the Company and every company which is under the Control of the Company and member of the Group will be construed accordingly;

Participant means any individual who holds a subsisting Performance Share Award (including, where the context permits, the legal personal representatives of a deceased Participant);

Performance Period means the period, as specified in Rule 3.5(c), after which the Performance Target is measured;

Page 1

Performance Share Award means, unless Schedule 5 applies, a right granted under Rule 3 to receive Shares without payment and references to Performance Shares will be construed accordingly;

Performance Target means the conditions set out in Schedule 1, or such other conditions determined by the Committee in accordance with Rule 3.3, measured after the end of the Performance Period;

Plan means this Reed Elsevier Group plc Long-term Incentive Plan 2010 as amended from time to time;

Pro-rated Number means such number of Shares as is determined by multiplying the number of Shares comprised in a Performance Share Award by A/B where A is the number of complete calendar months which the Participant was an Employee during the Performance Period and B is 36;

Qualifying Company means each of RE PLC and RE NV;

RE NV means Reed Elsevier NV;

RE PLC means Reed Elsevier PLC;

Rules means these Plan rules;

Share means a UK Share and/or a Dutch Share and Shareholder will be construed accordingly;

Termination Date means the date on which an Employee ceases to be employed by a Qualifying Company or any member of the Group;

Vesting means the Participant becoming absolutely entitled to receive the Shares comprised in his Performance Share Award in accordance with these Rules and Vest and Vested will be construed accordingly.

1.2 Where the context permits the singular will include the plural and vice versa and the masculine will include the feminine. Headings will be ignored in construing the Plan.

1.3 References to any act of Parliament will include any statutory modification, amendment or re enactment thereof.

2. Eligibility

2.1 The Committee may select any Employee to participate in the Plan, except:-

(a)

a director of the Company or of a Qualifying Company or

Page 2

(b)

any Employee who is under notice of termination of employment at the Date of Grant, unless the Committee determines otherwise.

3. Grant of Performance Share Awards

3.1 Subject to Dealing Restrictions, Performance Share Awards may be granted at any time.

3.2 The grant of a Performance Share Award is conditional upon a Participant agreeing to comply with any arrangements specified by the Company for the payment of tax and social security contributions in respect of Shares to which he is or may become entitled under the Plan including, without limitation (i) the right to sell on the Participant’s behalf sufficient Shares to satisfy any tax or social security contributions liability on his part for which any member of the Group may be liable and (ii) entering into any election under Chapter 2 of Part 7 of the Income Tax (Earnings & Pensions) Act 2003 specified by the Company.

3.3 Performance Share Awards will be granted on the basis that they only Vest to the extent that the Performance Target has been satisfied.

3.4 The Committee may make the grant of Performance Share Awards subject to any other conditions it determines appropriate including requiring a Participant to agree to comply with certain post-employment restrictive covenants.

3.5 Performance Share Awards will be granted by deed. Each Participant will receive information (electronically or in hard copy) following the Date of Grant summarising the main terms of his Performance Share Award. This summary may include the following information:

a)		the number of Shares subject to the Performance Share Award — and in what proportion they comprise UK Shares and Dutch Shares;

b)		details of the Performance Target applicable to the Performance Share Award;

c)		the Performance Period;

d)		the terms of any other conditions imposed pursuant to Rules 3.2 and 3.4;

e)		whether or not the Performance Share Award carries a right to Dividend Equivalents;

f)		which (if any) Schedules to the Plan will apply to the Performance Share Award;

g)		any other information as the Committee may determine.

4. Normal Vesting of Performance Share Awards

4.1 Except as otherwise provided in the Rules, the number of Shares, if any, which Vest under a Performance Share Award will be determined by the Committee by reference to the extent to which the Performance Target has been fulfilled, and any other conditions to which the Performance Share Award is subject, have been fulfilled or waived.

Page 3

4.2 Except as otherwise provided in these Rules, Performance Share Awards will Vest, in accordance with Rule 4.1, on the Normal Vesting Date and any balance which does not Vest will immediately lapse. Any Vested Performance Shares will be transferred to Participants as soon as reasonably practicable after that date, subject to any Dealing Restrictions.

5. Entitlement to Dividend Equivalents

5.1 If a Performance Share Award has been granted on the basis that it carries Dividend Equivalents, the Participant will, subject to Rule 5.3, be entitled to a cash payment equal in value to the ordinary dividends (excluding any associated tax credit) which would have been paid on the Vested Performance Shares during the period commencing at the start of the Performance Period and ending on the earlier of (i) the end of the Performance Period and (ii) the Vesting of the Performance Share Award.

5.2 The cash payment to which the Participant becomes entitled under Rule 5.1:

(a)		will be calculated (in such manner as the Committee sees fit) by reference to the currency of payment of the underlying dividend (and paid in such currency as the Committee sees fit);

(b)		will be calculated without any entitlement to interest (or other type of investment return) in the period between the dividend payment date and Vesting;

(c)		will be paid (subject to such deductions as are required by law) within one month of Vesting; and

(d)		will be calculated by reference to ordinary dividends and without regard to special dividends or distributions or dividends-in-specie.

5.3 Instead of making a cash payment, the Committee may in its discretion satisfy any entitlement to Dividend Equivalents arising in accordance with Rule 5.1 by transferring existing Shares with an equivalent value (as determined at the time of Vesting).

5.4 For the avoidance of doubt, any payment referred to in this Rule 5 does not represent an entitlement to actual dividends on the underlying Shares, by reason of the Participant not being beneficial owner of the Shares at that time.

6. Cessation of employment

Participant gives or receives notice

6.1 Except as otherwise provided in these Rules, in the event that a Participant gives or receives notice of termination of employment for any reason other than those set out in Rules 6.2 and 6.4, a Performance Share Award will automatically lapse on the date on which notice is given or received.

Approved Leaver

6.2 Except as otherwise provided in these Rules, in the event that the Participant ceases to be an Employee before the Normal Vesting Date by reason of:

Page 4

a)		redundancy (as defined in section 139 of the Employment Rights Act 1996);

b)		retirement with the consent of the Company;

c)		the sale of the company or business in which the Participant is employed out of the Group; or

d)		any other reason the Committee, in its absolute discretion, determines:

the Performance Share Award will continue in force over a Pro-rated Number of Shares until the end of the Performance Period and will lapse as to the balance on the Termination Date. The Performance Share Award will Vest on the Normal Vesting Date in accordance with Rule 4.

6.3 The Committee has discretion to vary the application of Rule 6.2 and determine that a Participant’s Performance Share Award should instead be treated as set out in Rule 6.4 or, in exceptional circumstances, in any other way the Committee determines appropriate.

Death, Injury, Disability and Ill-health.

6.4 Except as otherwise provided in these Rules, in the event that the Participant ceases to be an Employee before the Normal Vesting Date by reason of death, injury, disability or ill-health:

the Performance Share Award will Vest over a Pro-rated Number of Shares subject to an assessment of performance based on progress made against the Performance Target at the Termination Date as determined by the Committee in its absolute discretion. Such determination will take place as soon as practicable after the Termination Date and to the extent that the Performance Share Award does not Vest on the date of determination, it will immediately lapse.

6.5

The Committee has discretion to vary the application of Rule 6.4 and determine that:

a)		a Participant’s Performance Share Award should be treated as set out in Rule 6.2 above instead; or

b)		the Performance Target will be waived and/or the Performance Share Award will Vest in full on or shortly after the Termination Date as determined by the Committee. To the extent that the Performance Share Award does not Vest, it will immediately lapse.

7. Claw-Back Arrangements

Breach of Restrictive Covenants

7.1 If a Participant breaches any term of his post-termination restrictive covenants (such breach to be determined by the Committee acting fairly and reasonably), any unvested Performance Share Awards will lapse on the date of the Committee’s determination and the Committee may require him to pay to the Company or any other member of the Group, within seven days of written demand from the Company, the Relevant Amount (as defined in Rule 7.2 below).

Page 5

7.2 The Relevant Amount is an amount equal to A minus both B and C where:

A is an amount equal to the pre-tax gain realised by the Participant in respect of any Performance Share Awards and Dividend Equivalents in the period beginning six months before the Termination Date and ending when the Participant’s restrictive covenants cease to apply. For these purposes, the gain will be the sum of the market value of the Vested Shares when received by the Participant and the related Dividend Equivalents, and such gain will be determined irrespective of whether the Participant has sold or retained the Shares he acquired;

B is an amount equal to the tax and social security charges and liabilities incurred by the Participant in respect of A ; and

C is any payment of the Claw-back Amount, determined in accordance with Rule 7.4 below, in respect of A .

Materially misstated financial or other data

7.3 If the Committee, within two years of the Vesting of a Performance Share Award, considers in good faith that the Vesting of the relevant Performance Share Award and/or the payment of Dividend Equivalents was determined on the basis of materially misstated financial or other data (the Incorrect Award ), it will, unless it determines otherwise, recover the Claw-back Amount (as defined in Rule 7.4 below) by taking one or more of the following actions:

a)		reduce any outstanding unvested Performance Share Awards by the Claw-back Amount; and/or

b)		reduce any future Performance Share Awards by the Claw-back Amount; and/or

c)		require the Participant to pay to the Company, within thirty days of a written demand from the Company, the Claw-back Amount.

7.4 The Claw-back Amount is the difference in value between (i) the Incorrect Award and (ii) the Performance Share Awards and Dividend Equivalents which would have Vested or been payable had the correct data, as determined by the Committee acting fairly and reasonably, been used. This may be expressed as a number of Shares or a monetary amount or a combination thereof as the Committee considers appropriate. In determining the Claw-back Amount, the Committee may take into account such matters as it sees fit including, but not limited to:

(a)		the difference between the number of Shares under the Incorrect Award and the number of Shares the Committee considers should have Vested had the correct data been used;

(b)		any gain made by the Participant on the sale of Shares comprised in the Incorrect Award;

(c)		any tax and/or dealing costs incurred by the Participant in connection with the Incorrect Award, and

(d)		whether the Participant has made a payment pursuant to Rules 7.1 to 7.2 which would take account of Shares subject to an Incorrect Award.

Page 6

7.5 By accepting a Performance Share Award, a Participant will be bound by this Rule 7 notwithstanding (i) that it will only be applicable after the release of Shares under these Rules and (ii) whether or not the essential terms of this Rule 7 have been separately notified to each Participant.

8. Change of Control of a Qualifying Company

8.1 Except as otherwise provided in these Rules, if any person:

(a)		obtains Control of a Qualifying Company as a result of making an offer to acquire Shares which is either unconditional or is made on a condition such that if it is satisfied the person making the offer will have Control of that Qualifying Company;

(b)		becomes bound or entitled to acquire Shares under sections 979 and 983 of the Companies Act 2006 (or in relation to RE NV becomes entitled to acquire compulsorily Shares held by minority shareholders); or

(c)		obtains Control of a Qualifying Company in pursuance of a compromise or arrangement sanctioned by the Court under section 899 of the Companies Act 2006 (or in relation to RE NV under any equivalent legislative provision in the Netherlands),

then any unvested Performance Share Awards over Shares in that Qualifying Company (but not those in the other Qualifying Company) will Vest in respect of a Pro-rated Number within 30 days of the relevant event, subject to the Performance Target. The Performance Target will be assessed based on progress made against targets as at the date of the relevant event as determined by the Committee in its absolute discretion.

8.2 To the extent that a Performance Share Award over Shares in that Qualifying Company does not Vest as a result of the relevant event, it will immediately lapse.

9. Change of Control of the Company

Except as otherwise provided in these Rules, the provisions of Rule 8 will apply with any necessary changes in the event that any person (either alone or together with any person acting in concert with him) obtains Control of the Company and the Shares comprised in Performance Share Awards which may Vest as a result of the relevant event will be Shares in both Qualifying Companies.

10. Internal Reorganisation

10.1 Rules 8 and 9 will not apply if the purpose and effect of the change of Control or scheme of arrangement is:

(a)		to create a new holding company for the relevant Qualifying Company, such company having substantially the same Shareholders and proportionate shareholdings as those of the Qualifying Company immediately prior to the scheme of arrangement;

(b)		to give one Qualifying Company Control (directly or indirectly) of the other Qualifying Company;

Page 7

(c)		the person obtaining Control of the Company is one of the Qualifying Companies or a company under the Control of one or both of them; or

(d)		the Company remains under the ultimate Control of the Shareholders of the Qualifying Companies immediately prior to the relevant transaction affecting the Company.

10.2 If Rule 10.1 applies:

(a)		Performance Share Awards will not Vest as a result of the relevant event;

(b)		Performance Share Awards will instead be exchanged for equivalent awards over such shares as the Committee determines appropriate;

(c)		the Committee may make any modifications to the relevant Performance Target as it determines appropriate.

10.3 The Committee may vary the application of this Rule 10 so that it applies to Performance Share Awards over Shares in both Qualifying Companies or over Shares in only one Qualifying Company.

10.4 Where Rule 10 applies, a Participant will not be treated as ceasing to be an Employee until he ceases to be employed by a company which is either the relevant holding company or a subsidiary of the holding company (within the meaning of section 1159 of the Companies Act 2006).

11. Rollover on a change of control

11.1 The Committee may determine that Rules 8 or 9 will not apply on a change of Control of a Qualifying Company or the Company (as applicable) and may, with the consent of the person obtaining Control, (i) determine that the Performance Share Awards will be rolled over in accordance with either the provisions of Rule 10.2 or Rule 11.2 or (ii) allow the Participants to choose between Vesting under Rules 8 or 9 as applicable and rollover in accordance with, as determined by the Committee, Rule 10.2 or Rule 11.2.

11.2 The Committee can determine that Performance Share Awards are rolled over in accordance with the following terms:-

(a)		the Performance Target will be assessed based on progress made against targets as at the date of the relevant event as determined by the Committee in its absolute discretion;

(b)		to the extent that the Performance Target has been met, the Performance Share Award will be exchanged for an equivalent award over such shares as agreed between the Committee and the person obtaining Control, and will Vest on the Normal Vesting Date subject to the Participant remaining in employment within the acquirer group of companies (unless Rules 6.2 to 6.5 apply) and will be subject to the Rules as they last had effect in relation to the Performance Share Award that was rolled-over; and

(c)		to the extent that the Performance Target has not been met, the Performance Share Award will immediately lapse.

Page 8

11.3 For the avoidance of doubt, in Rules 8, 9, 10 and 11, “ Committee ” means those people who were members of the Committee immediately before the event by virtue of which the applicable Rule applies.

12. Voluntary winding up

The provisions of Rule 8 will apply with such changes as may be necessary in the event that notice is duly given of a resolution for a voluntary winding up of a Qualifying Company provided that , all references in Rule 8 to the date of the relevant event will be treated as references to the date on which notice is given for the voluntary winding-up of a Qualifying Company.

13. Adjustment of awards

13.1 In the event of:

(a)

any Capital Reorganisation; or

(b)

the implementation by a Qualifying Company of a demerger or the payment by a Qualifying Company of a super-dividend which would otherwise materially affect the value of a Performance Share Award,

the number of Shares in that Qualifying Company comprised in a Performance Share Award may be adjusted in such manner as the Committee determines.

14. Source of Shares

14.1 A Participant’s entitlement to Shares under this Plan will be satisfied from purchases on a recognised stock exchange. No new Shares will be issued or Shares transferred out of treasury in connection with the Plan.

15. Rights attaching to shares transferred pursuant to Performance Share awards

15.1 All Shares transferred on the Vesting of a Performance Share Award will rank pari passu in all respects with the Shares in issue at the date of Vesting except in respect of any rights attaching to such Shares by reference to a record date prior to the date of Vesting.

15.2 Any Shares acquired by a Participant under this Plan will be subject to the articles of association of the relevant Qualifying Company from time to time.

16. Administration, amendment and Termination

16.1 The decision of the Committee will be final and binding in all matters relating to the Plan including the exercise of any discretion under the Rules, the interpretation of the Rules and any dispute relating to any matter in connection with the Rules.

16.2 The Committee may at any time discontinue the grant of further Performance Share Awards or amend any of the provisions of the Plan in any way it thinks fit and such changes may affect Performance Share Awards already granted.

Page 9

16.3 Without prejudice to any provision of the Plan which provides for the lapse of a Performance Share Award, the Committee may not cancel a Performance Share Award unless the Participant agrees in writing to such cancellation.

16.4 The Committee may terminate the Plan at any time. The termination of the Plan will not affect existing Performance Share Awards.

17. General

Trustee funding

17.1 Any member of the Group may provide money to the trustees of any trust or any other person to enable them or him to acquire Shares to be held for the purposes of satisfying Performance Share Awards under the Plan, or enter into any guarantee or indemnity for these purposes, to the extent not prohibited by the provisions of the Companies Act 2006.

Discretionary nature of the Plan

17.2 The rights and obligations of a Participant under the terms and conditions of his office or employment will not be affected by his participation in the Plan or any right he may have to participate in the Plan.

17.3 Participation in this Plan does not imply any right to receive Performance Share Awards on the same or any other basis in any other year.

17.4 The terms of the Plan do not entitle the Participant to the exercise of any discretion in his favour.

17.5 An individual who participates in the Plan waives all and any rights to compensation or damages in consequence of the termination of his office or employment with RE PLC, RE NV or any member of the Group for any reason whatsoever insofar as those rights arise, or may arise, from his ceasing to have rights under the Plan as a result of such termination or from the loss or diminution in value of such rights. If necessary, the Participant’s terms of employment will be varied accordingly.

Changes to a Qualifying Company’s capital structure

17.6 The existence of any Performance Share Award will not affect in any way the right or power of the Company, the Qualifying Companies or their shareholders to make or authorise any or all adjustments, recapitalisations, reorganisations or other changes in the Company’s or either of the Qualifying Company’s capital structure, or any merger or consolidation of the Company or Qualifying Companies, or any issue of shares, bonds, debentures, preferred or prior preference stocks ahead of or convertible into, or otherwise affecting the Shares or the rights thereof, or the dissolution or liquidation of the Company or Qualifying Companies or any sale or transfer of all or any part of their assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

Notices

17.7 Any notice or other document which has to be given to a Participant under or in connection with the Plan may be delivered or sent by post to him at his home

Page 10

address according to the records of his employing company or sent by email or fax to any email address or fax number according to the records of his employing company or, in either case, such other address as may appear to the Company to be appropriate.

17.8 Notices sent by post to a Participant in the UK or US will be deemed to have been given two days after the date of posting. However notices sent to a Participant in other countries will be deemed to have been given on the seventh day after the date of posting.

17.9 Notices sent by email or fax, in the absence of evidence to the contrary, will be deemed to have been received on the day after sending.

17.10 Any notice or other document required to be given to the Company under or in connection with the Plan may be delivered or sent by post to it at its registered office (or such other place or places as the Committee may from time to time determine and notify to Participants) or sent by email or fax to any email address or fax number notified to the sender.

No transfer of Performance Share Awards

17.11 A Participant may not transfer, assign, charge or otherwise dispose of Performance Share Awards, or any rights in respect of them, except on the transmission of Performance Share Awards on the death of a Participant to his personal representatives or the assignment of a Performance Share Award, with the prior consent of the Committee, subject to any terms and conditions the Committee imposes. Any such attempted transfer will result in the lapse of the Performance Share Award.

Awards non-pensionable

17.12 Performance Share Awards and Dividend Equivalents under the Plan are not pensionable.

Taxation

17.13 Any liability of a Participant to taxation in respect of a Performance Share Award will be for the account of the relevant Participant. By accepting a Performance Share Award, a Participant agrees to comply with any arrangements specified by the Company for the payment of taxation (including, without limitation, arranging the sale of sufficient Shares to enable the Company or any member of the Group to satisfy its obligations in respect of deduction of taxation at source) and to enter into any election specified by the Company under Chapter 2 of Part 7 of the Income Tax (Employment & Pensions) Act 2003 in respect of shares to which he is or may become entitled under the Plan.

Stamp Duty

17.14 The Company or, where the Committee so directs, any member of the Group, will pay the appropriate stamp duty on behalf of Participants in respect of any transfer of Shares on the Vesting of a Performance Share Award.

Page 11

Data Protection

17.15 By accepting the grant of a Performance Share Award, a Participant consents to the holding and processing of personal data provided by him to a Qualifying Company or any member of the Group, and any other persons for all purposes related to the operation of the Plan and acknowledges that the personal information may be transferred to, and stored at, a destination outside the European Economic Area (“EEA”), and may also be processed by staff operating outside the EEA who work for a Qualifying Company or any member of the Group or for one of their service providers. The Company will take all steps reasonably necessary to ensure that a Participant’s personal data is treated securely under appropriate contractual arrangements.

Governing Law

17.16 This Plan will be governed by, and construed in accordance with, the laws of England.

Page 12

SCHEDULE 1

Performance Target

General

1. The following provisions apply to Performance Share Awards granted under the Plan, unless the Committee determines otherwise at the Date of Grant in respect of any Performance Share Award.

2. Except as otherwise provided for in the Rules, the Performance Targets applicable to Performance Share Awards will be measured after the end of the Performance Period for such Performance Share Award.

3. There are three separate measures of equal weighting: a Relative Total Shareholder Return measure ( TSR Measure) , a Return on Invested Capital measure ( ROIC Measure ) and an Adjusted Earnings per Share measure ( EPS Measure ).

4. To the extent that the Performance Target is not satisfied, Performance Share Awards will lapse.

The TSR Measure

5.1 The Vesting of one third of the Performance Share Award is subject to the TSR ranking of Reed Elsevier measured over the Performance Period. The portion of a Performance Share Award subject to the TSR Measure is referred to as the “ TSR Tranche ”.

5.2 Three distinct comparator groups will be used — a Sterling Comparator Group, a Euro Comparator Group and a US Dollar Comparator Group. The TSR performance of RE PLC ordinary shares (based on RE PLC’s London listing) will be measured against the Sterling Comparator Group, the TSR performance of RE NV ordinary shares (based on RE NV’s Amsterdam listing) will be measured against the Euro Comparator Group; and the TSR performance of RE PLC ADRs and RE NV ADRs (based on the New York listing) will be measured against the US Dollar Comparator Group. The TSR performance will be measured separately against each comparator group and each ranking achieved will produce a payout, if any, in respect of one third of the TSR Tranche. The proportion of the TSR Tranche which Vests will be the sum of the payouts achieved against the three comparator groups.

5.3 TSR will be measured in local currency.

5.4 TSR for any company will be the percentage increase or decrease in the market value of a share over the relevant Performance Period and shall take account of dividends and other distributions paid in the course of that period (each such dividend being deemed to be reinvested in the shares of each relevant company from the date of payment of the dividend to the last day of the Performance Period).

5.5 Each comparator group comprises companies which were selected on the following basis: -

•

they are included in a relevant market index as at 31 December 2009— FTSE100 for the Sterling Comparator Group; Euronext100 and the

Page 13

DAX30 for the Euro Comparator Group; and the S&P500 for the US Dollar Comparator Group;

•

they are nearest in size to Reed Elsevier in terms of market capitalisation;

excluding:

	•		companies with mainly domestic revenues (as they do not reflect the global nature of the Qualifying Companies’ customer base);

	•		those engaged in extractive industries (as they are exposed to commodity cycles); and

	•		financial services companies (as they have a different risk/reward profile).

Relevant listed global peers operating in businesses similar to those of Reed Elsevier not otherwise included are added to the relevant comparator group.

Set out below are the comparators included in each comparator group:


STERLING
COMPARATOR GROUP	EURO COMPARATOR GROUP	US DOLLAR COMPARATOR GROUP
AGGREKO	ACCOR	3M
ASTRAZENECA	ADIDAS	ADOBE SYSTEMS
AUTONOMY CORP.	AHOLD	AGILENT TECHS.
BAE SYSTEMS	AIR LIQUIDE	AIR PRDS. & CHEMS.
BRITISH AIRWAYS	AKZO NOBEL	AMAZON.COM
BRITISH AMERICAN TOBACCO	ALSTOM	ANALOG DEVICES
BUNZL	ASML HOLDING	APPLIED MATS.
BURBERRY GROUP	BASF	AVON PRODUCTS
COBHAM	BMW	BAXTER INTL.
COMPASS GROUP	CARREFOUR	BECTON DICKINSON
DMGT	CHRISTIAN DIOR	CATERPILLAR
DIAGEO	DAIMLER	COLGATE-PALMOLIVE
EXPERIAN	DEUTSCHE POST	CORNING
GLAXOSMITHKLINE	EADS	CUMMINS
INTERCONTINENTAL HOTELS	ESSILOR INTL.	DEERE
IMPERIAL TOBACCO GROUP	HEINEKEN	DOW CHEMICAL
INFORMA	HERMES INTL.	DUN & BRADSTREET
INMARSAT	K + S	E. I. DU PONT DE NEMOURS
INTERNATIONAL POWER	LAFARGE	EBAY
INTERTEK GROUP	LAGARDERE GROUPE	EMERSON ELECTRIC
INVENSYS	LINDE	FICO
JOHNSON MATTHEY	LVMH	FORD MOTOR
KINGFISHER	MAN	GENZYME
NATIONAL GRID	METRO	H.J. HEINZ
PEARSON	MICHELIN	ILLINOIS TOOL WORKS
RECKITT BENCKISER GROUP	PERNOD-RICARD	JOHN WILEY
REXAM	PHILIPS ELTN. KONINKLIJKE	JOHNSON CONTROLS
ROLLS-ROYCE GROUP	PORTUGAL TELECOM SGPS	JUNIPER NETWORKS
SABMILLER	PPR	LIFE TECHNOLOGIES
SAGE GROUP	RENAULT	MCDONALDS
SHIRE	SAINT-GOBAIN	MCGRAW-HILL
SMITH & NEPHEW	SAP	MICRON TECHNOLOGY
SMITHS GROUP	SCHNEIDER ELECTRIC	MOTOROLA
THOMAS COOK GROUP	SUEZ ENVIRONNEMENT	NEWS CORP

Page 14


STERLING
COMPARATOR GROUP	EURO COMPARATOR GROUP	US DOLLAR COMPARATOR GROUP
TUI TRAVEL	THALES	NIKE
UNILEVER (LSE)	THYSSENKRUPP	NVIDIA
UNITED BUSINESS MEDIA	TNT	PACCAR
VODAFONE	UNILEVER (AEX)	PPG INDUSTRIES
WOLSELEY	VALLOUREC	SPECTRA ENERGY
WPP	VEOLIA ENVIRONNEMENT	TEXAS INSTS.
	VOLKSWAGEN	THOMSON REUTERS (NYSE)
	WOLTERS KLUWER	UNITED TECHNOLOGIES
		YUM! BRANDS

5.6 Any changes in the comparator groups as a result of delisting or consolidation will be treated in accordance with the methodology agreed by the Committee at its sole discretion from time to time. In determining the methodology to be applied, the Committee will have due regard to market practice, ensure a consistent application of the agreed methodology and be open and transparent about the methodology applied.

5.7 The TSR ranking against the US Dollar Comparator Group will be calculated using the weighted average of the TSRs of the RE PLC ADRs and the RE NV ADRs over the relevant period of measurement.

5.8 The number of Performance Shares in each third of the TSR Tranche which Vest will be calculated as follows and will be added together to determine the total number of Performance Shares within the TSR Tranche which are capable of Vesting:


	Vesting percentage of
	each third of the TSR
TSR ranking within the relevant TSR comparator group	Tranche
Below Median		0	%
Median		30	%
Upper quartile (top 25 ^th percentile)		100	%

5.9 Vesting is on a straight-line basis for ranking between median and upper quartile.

5.10 The averaging period applied for TSR measurement purposes is the six months before the start of the Performance Period and the last six months of the Performance Period.

The ROIC Measure

6.1 The Vesting of one third of the Performance Share Award relates to the percentage return on invested capital of the combined businesses of the Qualifying Companies. Vesting relates to the percentage ROIC for the last financial year of the relevant Performance Period. The portion of a Performance Share Award subject to the ROIC Measure is referred to as the ‘ ROIC Tranche’ .

6.2 With respect to Performance Share Awards granted in 2010, for any part of the ROIC Tranche to Vest, the percentage ROIC for financial year 2012 must exceed the percentage ROIC for financial year 2009, calculated on the same basis.

Page 15

6.3 The following definitions are relevant for ROIC:

	(i)		Invested capital = arithmetic average of the opening and closing capital employed stated before financing and tax balances for the combined businesses of the Qualifying Companies adjusted for major acquisition timing for the financial year with all cumulative amortisation and impairment charges for acquired intangible assets and goodwill added back and excluding the gross up to goodwill in respect of deferred tax liabilities established on the acquisition of intangible assets retranslated at the average and hedge exchange rates applicable to the financial year before the start of the Performance Period . In addition, any exceptional restructuring and acquisition related charges (net of tax) over the Performance Period are capitalised for these purposes and the effect of changes in exchange rates and movements in the net pension deficits are excluded.

	(ii)		Return = adjusted operating profit for the combined businesses of the Qualifying Companies before amortisation and impairment of acquired intangible assets and goodwill, exceptional restructuring and acquisition related charges and grossed up to exclude the equity share of taxes in joint ventures and further adjusted to exclude movements in the net pension financing credit, after applying the effective rate of tax used for adjusted earnings calculations and using exchange rates to match those used in the calculation of invested capital.

6.4 The number of Performance Shares in the ROIC Tranche which are capable of Vesting will be determined as follows:


ROIC Percentage - measured in respect of last	Vesting percentage of
financial year of the Performance Period	ROIC Tranche
Below 10.2%		0	%
10.2%		60	%
11.2% or above		100	%

6.5 Vesting is on a straight-line basis for performance between the minimum and maximum levels.

The EPS Measure

7.1 The Vesting of one third of the Performance Share Award relates to the average growth in Adjusted Earnings per Share at constant currencies ( Adjusted EPS ) of the Qualifying Companies measured, except as stated in Rule 7.2 below, over the Performance Period. The portion of the Performance Share Award subject to the EPS Measure is referred to as the ‘ EPS Tranche ‘ .

Page 16

7.2 With respect to Performance Share Awards granted in 2010, Average Adjusted EPS Growth is measured over financial years 2011 and 2012 of the Qualifying Companies. In addition, for any part of the EPS Tranche of the 2010 Performance Share Awards to Vest, Average Adjusted EPS Growth must be positive over the three financial years of the Qualifying Companies ending 31 December 2012.

7.3 The following definitions apply in respect of Adjusted EPS:

	(i)		Adjusted EPS Growth = the arithmetic mean of the growth in Adjusted EPS at constant currencies achieved by the Qualifying Companies over a relevant financial year;

	(ii)		Average Adjusted EPS Growth = the average of the Adjusted EPS Growth over the relevant period of measurement;

	(iii)		Adjusted Earnings = adjusted reported earnings. Adjustments include amortisation and impairment of acquired intangible assets and goodwill, exceptional restructuring and acquisition related charges, gains/losses on business disposals and other non-operating items, related tax effects and movements in deferred tax balances not expected to crystallise in the near term. The Committee retains discretion to adjust for changes in the net pension financing credit;

	(iv)		Adjusted Earnings Per Share = Adjusted Earnings divided by the Number of Shares;

	(v)		Number of Shares = weighted average number of shares in issue excluding shares held in treasury or by the Reed Elsevier Group plc Employee Benefit Trust; and

	(vi)		Constant currencies = refers to measurement at constant rates of exchange using the prior full year average and hedge rates.

7.4 The number of Performance Shares in the EPS Tranche which are capable of Vesting will be determined as follows:


	Vesting percentage
Average Adjusted EPS Growth	of EPS Tranche
Below 5% per annum		0	%
5% per annum		60	%
9% or above per annum		100	%

7.5 Vesting is on a straight-line basis for performance between the minimum and maximum levels.

Page 17

Determining satisfaction of targets at end of Performance Period

8.1 Following the end of the relevant Performance Period the Committee will:

	(a)		calculate and confirm with the auditors the Average Adjusted EPS Growth and ROIC over the relevant period of measurement; and

	(b)		arrange for a reputable provider of such information to calculate and report to the Committee on the TSR performance. If at the end of the Performance Period, any of the companies in the comparator groups have undergone a change in circumstances (such as delisting, the cessation of trading or merger with another company), the Committee may determine the appropriate treatment for such companies in accordance with its stated methodology for the purpose of determining their TSR and TSR ranking.

Adjustments

9. The Committee may make such adjustments to the Performance Target applicable to outstanding Performance Share Awards as it considers appropriate to take account of any factors which are relevant in the opinion of the Committee and in particular if there is an event which causes it to consider that the Performance Target, or any part of it, is no longer a fair measure of performance. The amended Performance Target shall be at least as challenging as the one originally set.

11. Without prejudice to the generality of paragraphs 9, 10 and 12, the Committee may, in consultation with the auditors, make the following adjustments in relation to the calculations to be carried out in accordance with this Schedule:

	(a)		any adjustments it considers appropriate if an event occurs giving rise to an adjustment of Performance Share Awards under Rule 13 of the Plan;

	(b)		any adjustments it considers appropriate to the calculation of TSR for each of the companies in the comparator group to take account of local market factors; and

	(c)		any adjustments it considers appropriate if there is any modification in the calculation of TSR or in relation to the relevant international accounting standard used to calculate EPS or ROIC.

Overriding Power

12. In determining the level of Vesting of a Performance Share Award under the Plan, the Committee will take into account the overall business performance of the Qualifying Companies and the Group over the relevant performance period and any other factors that it considers appropriate and may modify the Vesting level if it considers that such a modification would result in a fairer outcome.

Page 18

SCHEDULE 2

US Participants

This Schedule was adopted by the directors of Reed Elsevier Group plc on 21 April 2010.

The Rules of the Plan apply to Performance Share Awards granted to US participants subject to the modifications contained in this Schedule.

	(A)		In this Schedule, terms shall have the same meaning as in Rule 1 of the Rules unless modified by this Schedule.

	(B)		*US Participant* . Rule 1 is revised by the addition of the following definition of “US Participant”:

			*US Participant* means a Participant who is subject to United States taxation by reason of being a United States national, or resident in the United States for United States tax purposes;

	(C)		“Retirement” means, for the purposes of the application of Rule 6.2(b) of the Plan in relation to a US Participant, circumstances which the Committee determines on a case by case basis and in its absolute discretion to constitute retirement (irrespective of whether or not applicable retirement eligible criteria have been met);

	(D)		*Normal Vesting — Release of Shares.* Rule 4.2 shall have the additional requirement that if Shares are to be released to a US Participant, they shall in all instances be released no later than March 15 of the year following the year in which Vesting occurs.

	(E)		*Dividend Equivalent — Cash Payment.* Rule 5.2(c) shall have the additional requirement that any cash payment to the US Participant under this Rule shall in all instances be released no later than March 15 of the year following the year in which Vesting occurs.

	(F)		*Dividend Equivalent — Shares in Lieu of Cash.* Rule 5.3 shall have the additional requirement that if Shares are to be released to a US Participant in lieu of cash, they shall in all instances be released no later than March 15 of the year following the year in which Vesting occurs.

	(G)		*Approved Leaver.* Rule 6.2 shall have the additional requirement that the Shares released to a US Participant shall in all instances be transferred to the US Participant on or before March 15 of the year following the year in which Vesting occurs.

	(H)		*Death, Injury, Disability and Ill-health.* Rule 6.4 shall have the additional requirement that the Shares released to a US Participant or to a US Participant’s personal representative following the US Participant’s cessation of employment by reason of death, injury, disability or ill-health shall in all instances be transferred to the US

Page 19

Participant or the Participant’s personal representative on or before March 15 of the year following the year in which the US Participant’s cessation of employment occurs.

	(I)		*Award Rollover.* Except to the extent consistent with the requirements of Section 409A of the United States Internal Revenue Code (“Code”) for the deferral of compensation without penalty or additional tax or unless an exception to the application of Code Section 409A applies, Rule 11 shall not apply to any Performance Share Award held by a US Participant if, at the time the election provided by Rule 11 is available to the US Participant, it has Vested. In such case, the Rules of the Plan shall apply to the Performance Share Award without regard to Rule 11.

	(J)		*Application of Code Section 409A.* Although neither the Committee nor any member of the Group guarantees any particular tax treatment to a US Participant, awards granted pursuant to this Schedule are intended to be exempt from Section 409A of the Code under the exception for short-term deferrals set forth in Section 1.409A-1(b)(4) of the United States Income Tax Regulations (which requires, in the case of an employer with a fiscal year ending 31 December, that Shares in satisfaction of an award be transferred to the US Participant no later than March 15 of the calendar year following the calendar year in which the award is no longer subject to a substantial risk of lapsing) and shall be limited, construed and interpreted in accordance with such intent.

Page 20

SCHEDULE 3

ELSEVIER REED FINANCE BV

The Rules of the Plan apply to Performance Share Awards granted to employees of Elsevier Reed Finance BV (“ERF”), or of companies under the Control of ERF, subject to the modifications contained in this Schedule.

	(A)		In this Schedule, terms shall have the same meaning as in Rule 1 of the Rules unless modified by this Schedule.

	(B)		The definition of Group shall be construed as including ERF and every company which is under the Control or ERF.

	(C)		Performance Share Awards shall not be granted under this Schedule without the agreement of the supervisory board of ERF.

Page 21

SCHEDULE 4

French Participants

This Schedule was adopted by the directors of Reed Elsevier Group plc on 21 April 2010.

The Rules of the Plan apply to Performance Share Awards granted to French participants subject to the modifications contained in this Schedule.

1. Definitions

1.1		The definitions of *Performance Share Award* and *Group* in Rule 1.1 are deleted and replaced with the following definitions:

		*Performance Share Award* means a non-transferable, unfunded and conditional right granted under Rule 3 to receive Shares without payment and references to Performance Shares will be construed accordingly;

		*Group* means the Company and (i) any company in which the Company holds, directly or indirectly, at least 10 per cent of the share capital or voting rights; and (ii) any company holding, directly or indirectly, at least 10 per cent of the share capital or voting rights of the Company and (iii) any company for which at least 50 per cent of the share capital or voting rights are held by a company which holds at least 50 per cent of the share capital of the Company and member of the Group will be construed accordingly;

1.2		The following new definitions will be added for the purpose of Performance Share Awards granted under this Schedule:

		*Defined Disability* means a disability of the second or third category under the meaning of Article L.341-4 of the French Social Security Code;

		*Eligible Individual* means:

	•		any salaried employee of a member of the Group, or a corporate officer holding the duties of Chairman of the Board, General Manager, Deputy General Managers, or member of the Directory Board or Manager (respectively President du Conseil d’administration, Directeur Général, Directeurs Généraux Délégués, membres du Directoire and Gérant ) of any member of the Group,

	•		who is a salaried employee of the Company or any member of the Group who does not hold 10% or more (taking into account any unvested Performance Share Awards under this Plan or any other share plan subject to provisions of articles L.225-197-1 et seq. of the

Page 22

FCC) of the share capital of RE NV or RE PLC, or would, as a result of a grant being made under this Plan, hold 10% or more of the share capital of RE NV or RE PLC.

Holding Period means a two-year period following the transfer of Shares under the Plan to a Participant, during which the Shares cannot be sold, transferred or otherwise disposed of;

2. Rule 2 (Eligibility)

In Rule 2.1, the word “Employee” will be replaced by “Eligible Individual”.

3. Rule 4 (Normal Vesting of Performance Share Awards)

3.1		Rule 4.1 shall be supplemented with the following provision:

		“The Normal Vesting Date for Performance Share Awards will not be before the second anniversary of the Date of Grant. Furthermore, if a Performance Share Award would otherwise Vest in accordance with any provision of the Plan or of this Schedule 4 (except as provided under Rule 6.5, as amended by paragraph 6.1 of this Schedule 4, (death and Defined Disability)) before the second anniversary of the Date of Grant, the Performance Share Award will not so Vest but will continue until the second anniversary of the Date of Grant, or a later date as determined by the Committee, when it will Vest”.

3.2		The last sentence of Rule 4.2 will be deleted and replaced with the following:

		“Any Vested Performance Shares will be transferred, as soon as reasonably practicable after that date, subject to any Dealing Restrictions, to a share account administered in the name of and for the benefit of the Participant by an account keeper (teneur de compte) designated by the Committee. Participants will have full shareholder voting and dividend rights on the transferred shares.

		Any Shares transferred will be held by the account keeper on behalf of the Participant for the duration of the Holding Period, except as provided under Rule 6.5, as amended by paragraph 6.1 of this Schedule 4, (death and Defined Disability), or as otherwise provided for in the FCC or in the French tax Code as an exception to the Holding Period.

		On expiry of the Holding Period, the participant will be free to dispose of the Shares.”

4. Rule 5 (Entitlement to Dividend Equivalents)

A Performance Share Award granted under this Schedule shall only be granted on the basis that it carries a right to Dividend Equivalents to the extent permitted under the FCC and the French Tax Code and without jeopardising the favourable tax and social security regime applicable to the related Performance Share Awards.

Page 23

5. Rules 6.2 and 6.3 (Approved Leaver)

5.1		Shares which Vest in accordance with Rule 6.2 will be subject to the Holding Period.

5.2		Rule 6.3 will not apply to Performance Share Awards granted under this Schedule.

6. Rules 6.4 and 6.5 (Death, Injury, Disability and ill-health)

6.1

Rules 6.4 and 6.5 will be deleted and replaced with the following new Rules:

6.4 Except as otherwise provided in these Rules, in the event that the Participant ceases to be an Employee before the Normal Vesting Date by reason of injury, disability or ill-health (excluding Defined Disability) , the Participant’s Performance Share Award will be treated in accordance with Rule 6.2 and any Shares which Vest will be subject to the Holding Period.

6.5 Notwithstanding any other Rule of the Plan, where a Participant ceases employment before the Normal Vesting Date by reason of death or Defined Disability:

	a)		the Performance Share Award will Vest over a Pro-rated Number of Shares subject to an assessment of performance based on progress made against the Performance Target at the Termination Date as determined by the Committee in its absolute discretion. Such determination will take place as soon as practicable after the Termination Date and to the extent that the Performance Share Award does not Vest on the date of determination, it will immediately lapse; or

	b)		the Performance Target will be waived and/or the Performance Share Award will Vest in full on or shortly after the Termination Date as determined by the Committee. To the extent that the Performance Share Award does not Vest, it will immediately lapse.

Any Shares which Vest in accordance with this Rule 6.5 will be transferred to the Participant (or, in the case of death, to the personal representatives of the Participant) as soon as practicable following Vesting, and will not be subject to any Holding Period.

7. Rules 8, 9, 10, 11, 12, 13 (Change of Control, Internal Reorganisation, Rollover, Winding up, Adjustment of Awards)

Rules 8, 9, 10, 11, 12 and 13 of the Plan will apply in accordance with Article L.225-197-1-III of the FCC to the extent that the Committee intends the Performance Share Awards to maintain favourable tax treatment under this Schedule 4. However, in the event the Committee does not intend to maintain such favourable tax treatment, Rules 8, 9, 10, 11, 12 and 13 of the Plan will prevail notwithstanding any possible detrimental tax or social security consequences for the Participant.

8. Rule 16 (Administration, amendment and termination)

Page 24

		Rule 16.2 will be supplemented with the following words:

		“provided that the changes do not affect the French qualifying status of the Performance Share Awards granted under Schedule 4 and provided that no such changes will adversely affect the rights of any Participant without such Participant’s consent”

9. Rule 17.11 (No transfer of Performance Share Awards)

In Rule 17.11, the following words will be deleted:

“or the assignment of a Performance Share Award, with the prior consent of the Committee, subject to any terms and conditions the Committee imposes”

10. Rule 17.13 (Taxation)

		In Rule 17.13, the following words will be deleted:

		“and to enter into any election specified by the Company under Chapter 2 of Part 7 of the Income Tax (employment & Pensions) Act 2003 in respect of shares to which he is or may become entitled under the Plan”

		In Rule 3.2, the wording after (ii) will be deleted.

11. Severability

Page 25

SCHEDULE 5

Cash Alternative

	(A)		The Committee may decide to satisfy a Performance Share Award by paying to the Participant an amount equal to the market value (as determined in its discretion) of the number of Shares which would otherwise be transferred following Vesting or an amount determined on such other reasonable basis as the Committee may decide (which could for example, allow for the deduction of any applicable expenses).

	(B)		The Committee may grant a Performance Share Award on the basis that it will be satisfied in cash, as opposed to Shares, as set out in (A) above.

Page 26

Exhibit 5.1

The Directors
Reed Elsevier PLC
1-3 Strand
London
WC2N 5JR

Dear Sirs/Madam:

RE: Registration Statement on Form S-8 (the “Registration Statement”)

1. This opinion is given in connection with the registration under the United States Securities Act of 1933, as amended (the “Act”) of 18,000,000 Ordinary Shares, nominal value 14 51/116 pence per share (“Ordinary Shares”), of Reed Elsevier PLC, a listed public liability company duly incorporated and existing under the laws of England and Wales (the “Company”), to be issued in connection with the Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan or the Reed Elsevier Group plc Growth Plan or the Reed Elsevier Group plc Bonus Investment Plan 2010 or the Reed Elsevier Group plc Long — Term Incentive Plan 2010 (the “Plans”).

2. This opinion is limited to English law as applied by the English courts and is given on the basis that it will be governed by and be construed in accordance with English law.

3. I have examined and relied on copies of such corporate records and other documents, including the Registration Statement, and reviewed such matters of English law as I have deemed necessary or appropriate for the purpose of this opinion.

4. On the basis of, and subject to, the foregoing and having regard to such consideration of English law in force at the date of this letter as I consider relevant, I am of the opinion that (i) the Company has been duly organized and is an existing company in good standing under the laws of England and (ii) and Ordinary Shares to be issued by the Company pursuant to and in accordance with the Plans will be legally and validly issued, fully paid and non-assessable (i.e., no further contributions in respect thereof will be required to be made to the Company by the holders thereof, by reason only of their being such holders).

I consent to the filing of this opinion as an exhibit to the Registration Statement on Form S-8 relating to such Ordinary Shares. In giving such consent, I do not thereby admit that I am within the category of persons whose consent is required under Section 7 of the Act.

Yours faithfully




S J Cowden
General Counsel and Company Secretary

Date: 24 May 2010

Exhibit 5.2

To the members of the Executive Board of Reed Elsevier NV
Radarweg 29
103 NX Amsterdam
The Netherlands

Dear Sirs:

RE: Registration Statement on Form S-8 (the “Registration Statement”)

1. This opinion is given in connection with the registration under the United States Securities Act of 1933, as amended (the “Act”) of 12,000,000 Ordinary Shares, nominal value €0.07 per share (“Ordinary Shares”), of Reed Elsevier NV, a listed public limited liability company duly incorporated and existing under the laws of the Netherlands (the “Company”), to be issued in connection with the Reed Elsevier Group plc Lexis-Nexis Risk & Information Analytics Group Long Term Incentive Plan or the Reed Elsevier Group plc Growth Plan or the Reed Elsevier Group plc Bonus Investment Plan 2010 or the Reed Elsevier Group plc Long-Term Incentive Plan 2010 (the “Plans”).

2. This opinion is limited to the laws of The Netherlands as applied by The Netherlands courts and is given on the basis that it will be governed by and be construed in accordance with the law of The Netherlands.

3. I have examined and relied on copies of such corporate records and other documents, including the Registration Statement, and reviewed such matters of Dutch law as I have deemed necessary or appropriate for the purpose of this opinion.

4. On the basis of, and subject to, the foregoing and having regard to such consideration of the laws of The Netherlands in force at the date of this letter as I consider relevant, I am of the opinion that (i) the Company has been duly organized and is an existing company in good standing under the law of The Netherlands and (ii) and Ordinary Shares to be issued by the Company pursuant to and in accordance with the Plans will be legally and validly issued, fully paid and non-assessable (i.e., no further contributions in respect thereof will be required to be made to the Company by the holders thereof, by reason only of their being such holders).

Yours faithfully




Jans van der Woude
Company Secretary

Date: 24 May 2010

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
REED ELSEVIER PLC CONSOLIDATED FINANCIAL STATEMENTS

We consent to the incorporation by reference in this Registration Statement on Form S-8 of our reports dated February 17, 2010 relating to the consolidated financial statements of Reed Elsevier PLC and the effectiveness of Reed Elsevier PLC’s internal control over financial reporting appearing in the Annual Report on Form 20-F of Reed Elsevier PLC and Reed Elsevier NV for the year ended December 31, 2009.



/s/ Deloitte LLP
London, England

May 24, 2010

Exhibit 23.2

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
REED ELSEVIER NV CONSOLIDATED FINANCIAL STATEMENTS

We consent to the incorporation by reference in this Registration Statement on Form S-8 of our reports dated February 17, 2010 relating to the consolidated financial statements of Reed Elsevier NV and the effectiveness of Reed Elsevier NV’s internal control over financial reporting appearing in the Annual Report on Form 20-F of Reed Elsevier NV and Reed Elsevier PLC for the year ended December 31, 2009.



/s/ DELOITTE ACCOUNTANTS B.V.

Amsterdam, The Netherlands
May 24, 2010

Exhibit 23.3

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
REED ELSEVIER COMBINED FINANCIAL STATEMENTS

We consent to the incorporation by reference in this Registration Statement on Form S-8 of our reports dated February 17, 2010, relating to the combined financial statements of Reed Elsevier PLC, Reed Elsevier NV, Reed Elsevier Group plc and Elsevier Reed Finance BV and their respective subsidiaries, associates and joint ventures (together “the combined businesses”) and the effectiveness of the combined businesses’ internal control over financial reporting, appearing in the Annual Report on Form 20-F of Reed Elsevier PLC and Reed Elsevier NV for the year ended December 31, 2009.


/s/ Deloitte LLP				/s/ DELOITTE ACCOUNTANTS B.V.
London, England				Amsterdam, The Netherlands
May 24, 2010				May 24, 2010

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents

Table of Contents