o | REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934 |
þ | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
o | SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
Title of each class | Name of each exchange on which registered | |
Ordinary Shares of 11 17/43 pence each | The New York Stock Exchange* | |
American Depositary Shares, each representing five | The New York Stock Exchange | |
Ordinary Shares of 11 17/43 pence each | ||
6.625% Guaranteed Notes due 2018 | The New York Stock Exchange | |
6.30% Guaranteed Notes due 2016 | The New York Stock Exchange | |
Preferred Stock ($100 par value-cumulative): | ||
3.90% Series | The New York Stock Exchange | |
3.60% Series | The New York Stock Exchange |
* | Not for trading, but only in connection with the registration of American Depositary Shares representing Ordinary Shares pursuant to the requirements of the Securities and Exchange Commission. |
Ordinary Shares of 11 17/43 pence each | 3,648,339,475 |
Large accelerated filer þ | Accelerated filer o | Non-accelerated filer o |
ii
PART I
|
||||||||
|
||||||||
Item 1. |
Identity of Directors, Senior Management and Advisers
|
1 | ||||||
Item 2. |
Offer Statistics and Expected Timetable
|
1 | ||||||
Item 3. |
Key Information
|
1 | ||||||
Item 4. |
Information on the Company
|
2 | ||||||
Item 4A. |
Unresolved Staff Comments
|
4 | ||||||
Item 5. |
Operating and Financial Review and Prospects
|
4 | ||||||
Item 6. |
Directors, Senior Management and Employees
|
4 | ||||||
Item 7. |
Major Shareholders and Related Party Transactions
|
4 | ||||||
Item 8. |
Financial Information
|
5 | ||||||
Item 9. |
The Offer and Listing
|
5 | ||||||
Item 10. |
Additional Information
|
6 | ||||||
Item 11. |
Quantitative and Qualitative Disclosures about Market Risk
|
11 | ||||||
Item 12. |
Description of Securities Other than Equity Securities
|
11 | ||||||
PART II
|
||||||||
|
||||||||
Item 13. |
Defaults, Dividend Arrearages and Delinquencies
|
13 | ||||||
Item 14. |
Material Modifications to the Rights of Security Holders and Use of Proceeds
|
13 | ||||||
Item 15. |
Controls and Procedures
|
13 | ||||||
Item 16. |
[Reserved]
|
14 | ||||||
Item 16A. |
Audit Committee Financial Expert
|
14 | ||||||
Item 16B. |
Code of Ethics
|
14 | ||||||
Item 16C. |
Principal Accountant Fees and Services
|
14 | ||||||
Item 16D. |
Exemptions from the Listing Standards for Audit Committees
|
15 | ||||||
Item 16E. |
Purchases of Equity Securities by the Issuer and Affiliated Purchasers
|
15 | ||||||
Item 16F. |
Change in Registrants Certifying Accountant
|
15 | ||||||
Item 16G. |
Corporate Governance
|
15 | ||||||
PART III
|
||||||||
|
||||||||
Item 17. |
Financial Statements
|
16 | ||||||
Item 18. |
Financial Statements
|
16 | ||||||
Item 19. |
Exhibits
|
17 | ||||||
SIGNATURE |
|
20 | ||||||
EX-2.B.1 | ||||||||
EX-2.B.2 | ||||||||
EX-4.C.20 | ||||||||
EX-8 | ||||||||
EX-12.1 | ||||||||
EX-12.2 | ||||||||
EX-13 | ||||||||
EX-15.1 | ||||||||
EX-15.2 |
iii
1
2
3
4
5
6
7
8
9
10
11
12
2011
2010
2009
2008
2007
£m
14,343
14,007
15,687
11,498
8,778
£m
3,745
3,293
2,623
2,964
2,513
£m
2,163
1,389
922
1,575
1,310
£m
2,163
1,389
947
3,193
1,396
Pence
63.9
48.4
31.8
51.3
41.0
Pence
63.6
48.2
31.7
51.1
40.8
Pence
63.9
48.4
32.7
104.2
43.7
Pence
63.6
48.2
32.5
103.7
43.5
Millions
3,378
2,864
2,886
3,062
3,188
Millions
3,397
2,877
2,902
3,077
3,206
£m
46,375
43,553
44,467
37,771
28,389
£m
9,069
4,211
3,984
5,374
4,136
£m
9,060
4,199
3,970
5,356
4,125
Pence
37.74
36.65
33.94
29.5
26.8
Pence
36.37
38.49
35.64
33.0
28.7
US
$
0.592
0.579
0.523
0.593
0.513
US
$
0.571
0.608
0.549
0.663
0.549
1
Since the implementation of IFRS by the
Company, there have been no significant changes in accounting standards,
interpretations or policies that have had a material financial impact on the
selected financial data.
The selected financial data incorporates businesses acquired in the period
from the date of their acquisitions, principally KeySpan Corporation acquired
in August 2007 and our Rhode Island gas distribution operations acquired in
August 2006. Comparatives for 2008 have been restated for the finalization of
the fair value exercise on the acquisition of KeySpan Corporation.
2
Items previously reported for 20072010
separately as other operating income have been included within revenue.
3
Items previously reported for 2007 -
2010 have been restated to reflect the impact of the bonus element of the
rights issue and as a result of the additional shares issued as scrip
dividends.
4
Comparative Earnings Per Share data have
been restated to reflect the impact of the additional shares issued as scrip
dividends
Table of Contents
High
Low
1.6452
1.6334
1.6543
1.6118
1.6648
1.603
1.6387
1.5973
1.6265
1.5994
1.6160
1.5464
1.5857
1.5391
Average**
1.56
1.58
1.54
2.01
1.91
*
For the period to 9 June 2011.
**
The average for each period is calculated by using the average of the
exchange rates on the last day of each month during the period.
Table of Contents
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Number of
Ordinary
% of
Outstanding
Shares
Share Capital*
182,630,798
5.21
138,503,443
3.99
149,414,285
4.31
176,730,831
5.04
*
This number is calculated in relation to the issued share capital at the time the holding was disclosed.
Ordinary Share
(Pence)
ADS ($)
High
Low
High
Low
666.00
474.80
51.00
36.72
685.50
511.00
56.59
38.25
754.00
515.00
74.89
36.64
863.00
686.00
86.58
69.22
797.50
552.00
78.81
48.83
613.50
489.25
53.45
44.48
549.50
421.25
52.06
37.59
598.31
521.50
48.41
42.29
600.50
536.50
48.88
42.76
565.00
480.30
44.17
36.72
666.00
474.80
51.00
36.77
685.50
619.50
55.13
46.85
683.50
572.50
56.59
46.13
628.00
529.50
52.00
43.05
617.00
511.00
50.25
38.25
607.00
586.00
49.95
48.20
639.00
607.00
52.18
49.65
617.42
583.50
51.43
47.65
Table of Contents
Ordinary Share
(Pence)
ADS ($)
High
Low
High
Low
598.31
541.50
48.41
43.41
575.99
533.00
46.97
44.12
583.50
521.50
45.75
42.29
590.00
538.50
44.87
43.01
*
For the period to 9 June 2011.
Table of Contents
Table of Contents
Table of Contents
the beneficial owner of the ADSs or ordinary shares, as applicable, and of any
dividends that you receive;
an individual resident or citizen of the US, a US corporation, or a US partnership,
estate, or trust (but only to the extent the income of the partnership, estate, or trust
is subject to US taxation in the hands of a US resident person); and
not also a resident of the UK for UK tax purposes.
Table of Contents
Table of Contents
Persons Depositing or Withdrawing Shares Must Pay:
For:
Issuance of ADSs,
including issuances
resulting from a
distribution of shares or rights or
other property;
cancellation of
Table of Contents
Persons Depositing or Withdrawing Shares Must Pay:
For:
ADSs
for the purpose of
withdrawal, including
if the deposit
agreement terminates;
distribution of
securities
distributed to
holders of deposited
securities which are
distributed by the
Depositary to ADS
registered holders.
Cash distributions to
holders, except for
distributions of cash
dividends.
Transfer and
registration of
shares on our share
register to or from
the name of the
Depositary or its
agent when they
deposit or withdraw
shares.
Cable, telex and
facsimile
transmissions (when
expressly provided in
the deposit
agreement);
converting foreign
currency to US
dollars.
As necessary.
Shareholder Correspondence
PO Box 358516
Pittsburgh, PA 15252-8516
Telephone: 1-800-466-7215 (International +1-212-815-3700)
Email:
shrrelations@mellon.com
Table of Contents
13
14
15
Table of Contents
Year Ended
Year Ended
March 31,
March 31,
2011
2010
£m
7.9
8.4
0.0
0.2
0.9
1.4
1.8
1.0
£
10.6
£
11.0
(1)
The aggregate fees billed by PricewaterhouseCoopers LLP for the audit
of the Companys financial statements and regulatory reporting for the
fiscal year ended 31 March 2011 and the review of interim financial
statements for the six months ended 30 September 2010 were
£7.9million. Fees billed by PricewaterhouseCoopers LLP for the audit
of the Companys financial statements and regulatory reporting for the
fiscal year ended 31 March 2010 and the review of interim financial
statements for the six months ended 30 September 2009, were
£8.4million.
(2)
The aggregate fees billed by PricewaterhouseCoopers LLP for assurance
and related services that were reasonably related to the performance
of the audit or review of the Companys financial statements and are
not disclosed under Audit Fees above were £0.0 million in fiscal
2010/11 and £0.2million in fiscal 2009/10.
(3)
Aggregate fees billed by PricewaterhouseCoopers LLP for tax
compliance, tax advice and tax planning were £0.9 million in fiscal
2010/11 and £1.4million in fiscal 2009/10.
(4)
Aggregate fees billed by PricewaterhouseCoopers LLP for all other
services in fiscal 2010/11 were £1.7million. Other services include
fees relating to the rights issue, assurance on various systems
projects and sundry services, all of which have been subject to Audit
Committee approval. Aggregate fees billed by PricewaterhouseCoopers
LLP for all other services in fiscal 2009/10 were £1.0million.
Table of Contents
(c). Total Number of
(d). Maximum Number
Shares Purchased
of Shares (Rounded)
(b). Average
as Part of Publicly
that May Yet Be
(a). Total Number of
Price Paid
Announced Plans
Purchased Under the
Periods
Shares Purchased
per Share
or Programs
Plans or Programs
Table of Contents
16
17
18
19
London
United Kingdom
18 May 2011
Table of Contents
Table of Contents
Description
Articles of Association of National Grid plc adopted by Special Resolution
passed on 27 July 2009, effective 1 October 2009
Incorporated by reference
Amended and restated Deposit Agreement dated as of 1 August 2005 among
National Grid plc and The Bank of New York. (Exhibit 2 (a) to National Grid
plc Form 20-F dated 17 June 2008 File No. 1-14958)
Incorporated By Reference
Amended and Restated Trust Deed dated 26 July 2010 among National Grid plc,
National Grid Electricity Transmission plc and the Law Debenture Trust
Corporation p.l.c. relating to a 15,000,000,000 Euro Medium Term Note
Programme.
Filed herewith
Amended and Restated Trust Deed dated 18 February 2011 among National Grid Gas
plc, National Grid Gas Finance (NO 1) plc and the Law Debenture Trust
Corporation p.l.c relating to a 10,000,000,000 Euro Medium Term Note
Programme.
Filed herewith
Underwriting Agreement among National Grid plc and the underwriting banks
named therein, dated as 20 May 2010. (Exhibit 4.A.1 to National Grid plc Form
20-F dated 25 May 2010 File No. 1-14958)
Incorporated by reference
Service Agreement among National Grid plc and Mark Fairbairn 23 January 2007.
(Exhibit 4 (c).2 to National Grid Transco Form 20-F dated 19 June 2007 File
No. 1-14958)
Incorporated by reference
Service Agreement among The National Grid plc and Steven Holliday dated 1
April 2006. (Exhibit 4.(c).3 to National Grid Transco Form 20-F dated 19 June
2007 File No. 1-14958)
Incorporated by reference
Service Agreement among National Grid Group plc, National Grid Company plc and
Steve Lucas dated 13 June 2002. (Exhibit 4.5 to National Grid Transco Form
20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
Service Agreement among National Grid Transco plc, National Grid Company plc
and Nicholas Winser dated 28 April 2003. (Exhibit 4.8 to National Grid Transco
Form 20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
Employment Agreement among National Grid plc, National Grid USA and Thomas
King dated 11 July 2007. (Exhibit 4 (c).9 to National Grid plc Form 20-F
dated 17 June 2008 File No. 1-14958)
Incorporated by reference
Letter of Appointment Linda Adamany (Exhibit 4 (c).9 to National Grid plc
Form 20-F dated 19 June 2007 File No. 1-14958)
Incorporated by reference
Letter of Appointment Philip Aiken (Exhibit 4 (c).11 to National Grid plc
Form 20-F dated 17 June 2008 File No. 1-14958)
Incorporated by reference
Letter of Appointment John Allan (Exhibit 4.10 to National Grid Transco
Form 20-F dated 15 June 2005 File No. 1-14958)
Incorporated by reference
Letter dated 7 March 2006 to John Allan relating to appointment as chairman of
Remuneration Committee. (Exhibit 4 (c).8.2 to National Grid plc Form 20-F
dated 20 June 2006 File No. 1-14958)
Incorporated by reference
Letter of Appointment Ken Harvey (Exhibit 4.10 to National Grid Transco
Form 20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
Letter of Appointment Sir John Parker (Exhibit 4.12 to National Grid
Transco Form 20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
Letter of Appointment Stephen Pettit (Exhibit 4.13 to National Grid Transco
Form 20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
Table of Contents
Description
Letter of Appointment Maria Richter (Exhibit 4.14 to National Grid Transco
Form 20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
Letter of Appointment George Rose (Exhibit 4.15 to National Grid Transco
Form 20-F dated 16 June 2004 File No. 1-14958)
Incorporated by reference
National Grid plc Deferred Share Plan. (Exhibit 4 (c).16 to National Grid plc
Form 20-F dated 20 June 2006 File No. 1-14958)
Incorporated by reference
National Grid Executive Share Option Plan 2002 (Exhibit 4 (c) to National Grid
Group Form 20-F dated 21 June 2002 File No. 1-14958)
Incorporated by reference
National Grid Group Share Matching Plan 2002 (Exhibit 4 (c) to National Grid
Group Form 20-F dated 21 June 2002 File No. 1-14958)
Incorporated by reference
National Grid Transco Performance Share Plan 2002 (as approved 23 July 2002 by
a resolution of the shareholders of National Grid Group plc, adopted 17
October 2002 by a resolution of the Board of National Grid Group plc, amended
26 June 2003 by the Share Schemes Sub-Committee of National Grid Transco plc,
and amended 5 May 2004 by the Share Schemes Sub-Committee of National Grid
Transco plc) (Exhibit 4.19 to National Grid Transco Form 20-F dated 16 June
2004 File No. 1-14958)
Incorporated by reference
National Grid Executive Share Option Scheme (Exhibit 4D to National Grid Group
S-8 dated 26 July 2001 File No. 333-65968)
Incorporated by reference
Lattice Group Short Term Incentive Scheme (approved by a resolution of the
shareholders of BG Group plc effective 23 October 2000; approved by a
resolution of the Board of National Grid Transco plc on 30 April 2004; amended
by resolutions of the Board of Lattice Group plc effective on 21 October 2002
and 13 May 2004) (Exhibit 4.23 to National Grid Transco Form 20-F dated 16
June 2004 File No. 1-14958)
Incorporated by reference
Service Agreement among The National Grid plc and Andrew Bonfield dated 1
November 2010.
Filed herewith
List of subsidiaries
Filed herewith
Certification of Steve Holliday pursuant to Rule 13a-14(a) of the Exchange Act.
Filed herewith
Certification of Andrew Bonfield pursuant to Rule 13a-14(a) of the Exchange Act
Filed herewith
Certifications of Steve Holliday and Andrew Bonfield furnished pursuant to
Rule 13a-14(b) of the Exchange Act (such certifications are not deemed filed
for purpose of Section 18 of the Exchange Act and not incorporated by
reference in any filing under the Securities Act).
Filed herewith
National Grid plc Annual Report and Accounts 2010/11, in extracted form
Filed herewith
Consent of PricewaterhouseCoopers LLP, independent registered public
accounting firm to National Grid plc
Filed herewith
Table of Contents
20
NATIONAL GRID PLC
By:
/s/ Andrew Bonfield
Andrew Bonfield
Finance Director
13 June 2011
Contents | Page | |||
1 Interpretation
|
1 | |||
2 Issue of Instruments and Covenant to Pay
|
6 | |||
3 Form of the Instruments
|
8 | |||
4 Stamp Duties and Taxes
|
9 | |||
5 Application of Moneys Received by the Trustee
|
9 | |||
6 Covenants
|
10 | |||
7 Remuneration and Indemnification of the Trustee
|
13 | |||
8 Provisions Supplemental to the Trustee Acts
|
14 | |||
9 Disapplication and Trustee Liability
|
18 | |||
10 Waiver and Proof of Default
|
18 | |||
11 Trustee not Precluded from Entering into Contracts
|
18 | |||
12 Modification and Substitution
|
19 | |||
13 Appointment, Retirement and Removal of the Trustee
|
20 | |||
14 Instruments held in Clearing Systems and Couponholders
|
21 | |||
15 Currency Indemnity
|
22 | |||
16 Enforcement
|
23 | |||
17 Communications
|
23 | |||
18 Governing Law and Jurisdiction
|
24 | |||
Schedule 1 Part A Form of CGN Temporary Global Instrument
|
25 | |||
Schedule 1 Part B Form of CGN Permanent Global Instrument
|
32 | |||
Schedule 1 Part C Form of NGN Temporary Global Instrument
|
42 | |||
Schedule 1 Part D Form of NGN Permanent Global Instrument
|
48 | |||
Schedule 2 Part A Form of Definitive Instrument
|
55 |
i
Contents | Page | |||
Schedule 2 Part B Terms and Conditions of the Instruments
|
58 | |||
Schedule 2 Part C Form of Coupon
|
98 | |||
Schedule 2 Part D Form of Talon
|
100 | |||
Schedule 2 Part E Form of Receipt
|
102 | |||
Schedule 3 Provisions for Meetings of Instrumentholders
|
103 |
ii
(1) | NATIONAL GRID plc ( National Grid ) AND NATIONAL GRID ELECTRICITY TRANSMISSION plc (NGET) , (each an Issuer and together, the Issuers ); and | |
(2) | THE LAW DEBENTURE TRUST CORPORATION p.l.c. , (the Trustee , which expression, where the meaning so admits, includes any other trustee for the time being of this Trust Deed). |
(A) | The Issuers propose to issue from time to time bearer debt instruments (the Instruments ) in an aggregate nominal amount outstanding at any one time, including Instruments previously issued under the Programme, not exceeding the Programme Limit in accordance with the Dealer Agreement (the Programme ) and to be constituted by this Trust Deed. | |
(B) | The Trustee has agreed to act as trustee of this Trust Deed on the following terms and conditions. | |
(C) | For the purposes of the Programme, the Issuers and the Trustee entered into an amended and restated trust deed dated 24 July 2009 (the Original Trust Deed ) and have agreed to make certain amendments to the Original Trust Deed. |
1 | Interpretation | |
1.1 | Definitions | |
In this Trust Deed: | ||
Agency Agreement means the amended and restated agency agreement (as amended, supplemented and/or restated from time to time) relating to the Programme dated 26 July 2010, between the Issuers, the Trustee, The Bank of New York Mellon as Issuing and Paying Agent and the other agent(s) mentioned in it; | ||
Agents has the meaning given to it in the Agency Agreement; | ||
Calculation Agent means any person named as such in the Conditions or any Successor Calculation Agent; | ||
CGN means a temporary Global Instrument in the form set out in Part A of Schedule 1 or a permanent Global Instrument in the form set out in Part B of Schedule 1. | ||
Common Safekeeper means, in relation to a Series, the common safekeeper for Euroclear and Clearstream, Luxembourg appointed in respect of such Instruments. | ||
Clearstream, Luxembourg means Clearstream Banking, société anonyme ; | ||
Conditions means in respect of the Instruments of each Series the terms and conditions applicable to them which shall be substantially in the form set out in Part B of Schedule 2 (Terms and Conditions of the Instruments) as modified, with respect to any Instruments represented by a Global Instrument, by the provisions of such Global Instrument, and shall incorporate any additional provisions forming part of such terms and conditions set out in Part A of the Final Terms relating to the Instruments of that Series and shall be endorsed on the Definitive Instruments subject to amendment and completion as referred to in the |
1
first paragraph of Part A of Schedule 2 (Form of Definitive Instrument) and any reference to a particularly numbered Condition shall be construed accordingly; | ||
Contractual Currency means, in relation to any payment obligation of any Instrument, the currency in which that payment obligation is expressed and, in relation to Clause 8 (Provisions supplemental to the Trustee Acts), pounds sterling or such other currency as may be agreed between the relevant Issuer and the Trustee from time to time; | ||
Coupons means the coupons relating to interest bearing Instruments or, as the context may require, a specific number of them and includes any replacement Coupons issued pursuant to the Conditions; | ||
Dealer Agreement means the amended and restated dealer agreement (as amended, supplemented and/or restated from time to time) relating to the Programme dated 26 July 2010 between the Issuers, the Arranger and the dealers named in it; | ||
Definitive Instrument means an Instrument in definitive form having, where appropriate, Coupons, Receipt(s) and/or a Talon attached on issue and, unless the context requires otherwise, includes any replacement Instrument issued pursuant to the Conditions; | ||
Effective Date means the date on which the Arranger, has received, on behalf of the Dealers, each of the condition precedent documents listed in Schedule 2 to the Dealer Agreement and that each is, in form and substance, satisfactory to it; | ||
Euroclear means Euroclear Bank S.A./N.V.; | ||
Event of Default means an event described in Condition 9 and that, if so required by that Condition, has been certified by the Trustee to be, in its opinion, materially prejudicial to the interests of the Instrumentholders; | ||
Extraordinary Resolution has the meaning set out in Schedule 3 (Provisions for Meetings of Instrumentholders); | ||
Final Terms means, in relation to a Tranche, the final terms document substantially in the form set out in the Prospectus which will be completed at or around the time of the agreement to issue each Tranche of Instruments and which will constitute final terms for the purposes of Article 5.4 of the Prospectus Directive; | ||
Global Instrument means a temporary Global Instrument and/or, as the context may require, a permanent Global Instrument, a CGN or a NGN, as the context may require; | ||
holder in relation to an Instrument, Receipt, Coupon or Talon, and Couponholder and Instrumentholder have the meanings given to them in the Conditions; | ||
Instruments means the bearer debt instruments to be issued by each of the Issuers pursuant to the Dealer Agreement, constituted by this Trust Deed and for the time being outstanding or, as the context may require, a specific number of them; | ||
Issuing and Paying Agent means the person named as such in the Conditions or any Successor Issuing and Paying Agent in each case at its specified office; | ||
month means a calendar month; | ||
NGN means a temporary Global Instrument in the form set out in Part C of Schedule 1 or a permanent Global Instrument in the form set out in Part D of Schedule 1. |
2
outstanding means, in relation to the Instruments, all the Instruments issued except (a) those that have been redeemed in accordance with the Conditions, (b) those in respect of which the date for redemption has occurred and the redemption moneys (including all interest accrued on such Instruments to the date for such redemption and any interest payable after such date) have been duly paid to the Trustee or to the Issuing and Paying Agent as provided in Clause 2 (Issue of Instruments and Covenant to Pay) and remain available for payment against presentation and surrender of Instruments, Receipts and/or Coupons, as the case may be, (c) those which have become void or in respect of which claims have become prescribed, (d) those which have been purchased and cancelled as provided in the Conditions, (e) those mutilated or defaced Instruments which have been surrendered in exchange for replacement Instruments, (f) (for the purpose only of determining how many Instruments are outstanding and without prejudice to their status for any other purpose) those Instruments alleged to have been lost, stolen or destroyed and in respect of which replacement Instruments have been issued, and (g) any temporary Global Instrument to the extent that it shall have been exchanged for a permanent Global Instrument and any Global Instrument to the extent that it shall have been exchanged for one or more Definitive Instruments, in either case pursuant to its provisions provided that for the purposes of (i) ascertaining the right to attend and vote at any meeting of the Instrumentholders, (ii) the determination of how many Instruments are outstanding for the purposes of Conditions 9 and 11 and Schedule 3 (Provisions for Meetings of Instrumentholders), (iii) the exercise of any discretion, power or authority that the Trustee is required, expressly or impliedly, to exercise in or by reference to the interests of the Instrumentholders and (iv) the certification (where relevant) by the Trustee as to whether a Potential Event of Default is in its opinion materially prejudicial to the interests of the Instrumentholders, those Instruments which are beneficially held by or on behalf of the relevant Issuer or any of its subsidiary undertakings and not cancelled shall (unless no longer so held) be deemed not to remain outstanding. Save for the purposes of the proviso herein, in the case of each NGN, the Trustee shall rely on the records of Euroclear and Clearstream, Luxembourg in relation to any determination of the nominal amount outstanding of each NGN. | ||
Paying Agents means the persons (including the Issuing and Paying Agent) referred to as such in the Conditions or any Successor Paying Agents in each case at their respective specified offices; | ||
permanent Global Instrument means a Global Instrument representing Instruments of one or more Tranches of the same Series, either on issue or upon exchange of a temporary Global Instrument, or part of it, and which shall be substantially in the form set out in Part B or Part D of Schedule 1, as the case may be (Form of Permanent Global Instrument); | ||
Potential Event of Default means an event or circumstance that could with the giving of notice, lapse of time, issue of a certificate and/or fulfilment of any other requirement provided for in Condition 9 become an Event of Default; | ||
Programme Limit means the maximum aggregate nominal amount of Instruments which may be issued and outstanding at any time under the Programme, as such limit may be increased pursuant to the Dealer Agreement; | ||
Prospectus means the prospectus prepared in connection with the Programme and constituting (i) a base prospectus in respect of each Issuer for the purposes of Article 5.4 of the Prospectus Directive and (ii) listing particulars in respect of each Issuer for the |
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purposes of Listing Rule 2.2.11 of the Listing Rules of the Financial Services Authority, as revised, supplemented or amended from time to time by the Issuers including any documents which are from time to time incorporated in the Prospectus by reference except that in relation to each Tranche of Instruments only the applicable Final Terms shall be deemed to be included in the Prospectus; | ||
Prospectus Directive means Directive 2003/71/EC of the European Parliament and of the Council; | ||
Receipts means the receipts for the payment of instalments of principal in respect of Instruments of which the principal is repayable in instalments or, as the context may require, a specific number of them and includes any replacement Receipts issued pursuant to the Conditions; | ||
Redemption Amount means the Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount, as the case may be, all as defined in the Conditions; | ||
Series means a series of Instruments comprising one or more Tranches, whether or not issued on the same date, that (except in respect of the first payment of interest and their issue price) have identical terms on issue and are expressed to have the same series number; | ||
specified office means, in relation to a Paying Agent, the office identified with its name at the end of the Conditions or any other office approved by the Trustee and notified to Instrumentholders pursuant to Clause 6.63 (Notices to Instrumentholders); | ||
Successor means, in relation to an Agent such other or further person as may from time to time be appointed by either of the Issuers as such Agent with the written approval of, and on terms approved in writing by, the Trustee and notice of whose appointment is given to Instrumentholders pursuant to Clause 6.6 (Notices to Instrumentholders); | ||
successor in business means (a) an entity which acquires all or substantially all of the undertaking and/or assets of either Issuer or of a successor in business of either Issuer; or (b) any entity into which any of the previously referred to entity is amalgamated, merged or reconstructed and is itself not the continuing company; | ||
Talons mean talons for further Coupons or, as the context may require, a specific number of them and includes any replacement Talons issued pursuant to the Conditions; | ||
TARGET System means the Trans-European Automated Real-Time Gross Settlement Express Transfer (known as TARGET2) System which was launched on 19 November 2007 or any successor thereto; | ||
temporary Global Instrument means a Global Instrument representing Instruments of one or more Tranches of the same Series on issue and which shall be substantially in the form set out in Part A or Part C of Schedule 1, as the case may be (Form of Temporary Global Instrument); | ||
Tranche means, in relation to a Series, those Instruments of that Series which are issued on the same date at the same issue price and in respect of which the first payment of interest is identical; | ||
trust corporation means a trust corporation (as defined in the Law of Property Act 1925) or a corporation entitled to act as a trustee pursuant to applicable foreign legislation relating to trustees; and |
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Trustee Acts means both the Trustee Act 1925 and the Trustee Act 2000 of England and Wales. | ||
1.2 | Construction of Certain References | |
Unless the context otherwise requires, all references in this Trust Deed to: |
1.2.1 | the records of Euroclear and Clearstream, Luxembourg shall be to the records that each of Euroclear and Clearstream, Luxembourg holds for its customers which reflect the amount of such customers interests in the Instruments; | ||
1.2.2 | costs, charges, remuneration or expenses include any value added, turnover or similar tax charged in respect of them; | ||
1.2.3 | an action, remedy or method of judicial proceedings for the enforcement of creditors rights include references to the action, remedy or method of judicial proceedings in jurisdictions other than England as shall most nearly approximate to it; | ||
1.2.4 | the Trustees approval or consent shall, unless expressed otherwise, be subject to the requirement that any such approval or consent shall not be unreasonably withheld or delayed, such reasonableness to be determined by reference to acting in the interests of Instrumentholders as a whole; and | ||
1.2.5 | the appointment or employment of or delegation to any person by the Trustee shall be deemed to include a reference to, if in the opinion of the Trustee it is reasonably practicable, the prior notification of and consultation with the Issuers and, in any event, the notification forthwith of such appointment, employment or delegation, as the case may be. |
1.3 | Amendment and Restatement | |
The Original Trust Deed shall be amended and restated on the terms of this Trust Deed, such amendment and restatement to take effect from the Effective Date. Any Instruments issued on or after the Effective Date shall be issued pursuant to this Trust Deed. Save for Clause 6.5.1, this does not affect any Instruments issued prior to the Effective Date or any Instruments issued on or after the Effective Date so as to be consolidated and form a single Series with the Instruments of any Series issued prior to the Effective Date. Subject to such amendment and restatement, the Original Trust Deed shall continue in full force and effect. | ||
1.4 | Headings | |
Headings shall be ignored in construing this Trust Deed. | ||
1.5 | Contracts | |
References in this Amended and Restated Trust Deed to this Trust Deed or any other document are to this Amended and Restated Trust Deed or those documents as amended, supplemented or replaced from time to time in relation to the Programme and include any document that amends, supplements or replaces them. | ||
1.6 | Schedules | |
The Schedules are part of this Trust Deed and have effect accordingly. |
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1.7 | Alternative Clearing System | |
References in this Trust Deed to Euroclear and/or Clearstream, Luxembourg shall, wherever the context so permits, be deemed to include reference to any additional or alternative clearing system approved by the relevant Issuer, the Trustee and the Issuing and Paying Agent. In the case of NGNs, such alternative clearing system must also be authorised to hold Instruments as eligible collateral for Eurosystem monetary policy and intra-day credit operations. | ||
1.8 | Other Terms | |
Other terms defined in the Dealer Agreement or the Conditions have the same meaning in this Trust Deed. | ||
1.9 | Contracts (Rights of Third Parties) Act 1999 | |
A person who is not a party to this Trust Deed has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Trust Deed. | ||
2 | Issue of Instruments and Covenant to Pay | |
2.1 | Issue of Instruments | |
Each of the Issuers may from time to time issue Instruments in Tranches of one or more Series on a continuous basis with no minimum issue size in accordance with the Dealer Agreement. Before issuing any Tranche and not later than 3.00 p.m. (London time) on the second business day in London which for this purpose shall be a day on which commercial banks are open for general business in London preceding each proposed issue date, the relevant Issuer shall give written notice or procure that it is given to the Trustee of the proposed issue of such Tranche, specifying the details to be included in the relevant Final Terms. Upon the issue by either of the Issuers of any Instruments expressed to be constituted by this Trust Deed, such Instruments shall forthwith be constituted by this Trust Deed without any further formality and irrespective of whether or not the issue of such debt securities contravenes any covenant or other restriction in this Trust Deed or the Programme Limit. | ||
2.2 | Separate Series | |
The provisions of Clauses 2.3 (Covenant to Pay), 2.4 (Discharge), 2.5 (Payment after a Default) and 2.6 (Rate of Interest after a Default) and of Clauses 3 (Form of the Instruments) to 15 (Currency Indemnity) and Schedule 3 (Provisions for Meetings of Instrumentholders) (all inclusive) shall apply mutatis mutandis separately and independently to the Instruments of each Series and in such Clauses and Schedule the expressions Instrumentholders , Receipts , Coupons , Couponholders and Talons , together with all other terms that relate to Instruments or their Conditions, shall be construed as referring to those of the particular Series in question and not of all Series unless expressly so provided, so that each Series shall be constituted by a separate trust pursuant to Clause 2.3 (Covenant to Pay) and that, unless expressly provided, events affecting one Series shall not affect any other. | ||
2.3 | Covenant to Pay | |
The relevant Issuer shall on any date when any Instruments become due to be redeemed, in whole or in part, unconditionally pay to or to the order of the Trustee in the Contractual |
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Currency, in the case of any Contractual Currency other than Euro, in the principal financial centre for the Contractual Currency and, in the case of Euro, in a city in which banks have access to the TARGET System, in same day funds the Redemption Amount of the Instruments becoming due for redemption on that date together with any applicable premium and shall (subject to the Conditions and other than in respect of Zero Coupon Instruments) until such payment (both before and after judgment) unconditionally so pay to or to the order of the Trustee interest in respect of the nominal amount of the Instruments outstanding as set out in the Conditions (subject to Clause 2.6 (Rate of Interest after a Default)) provided that (a) payment of any sum due in respect of the Instruments made to the Issuing and Paying Agent as provided in the Agency Agreement shall, to that extent, satisfy such obligation except to the extent that there is failure in its subsequent payment to the relevant Instrumentholders or Couponholders under the Conditions and (b) a payment made after the due date or as a result of the Instrument becoming repayable following an Event of Default shall be deemed to have been made when the full amount due has been received by the Issuing and Paying Agent or the Trustee and notice to that effect has been given to the Instrumentholders (if required under Clause 6.8 (Notice of Late Payment)), except to the extent that there is failure in its subsequent payment to the relevant Instrumentholders or Couponholders under the Conditions. This covenant shall only have effect each time Instruments are issued and outstanding, when the Trustee shall hold the benefit of this covenant on trust for the Instrumentholders and Couponholders of the relevant Series. | ||
2.4 | Discharge | |
Subject to Clause 2.5 (Payment after a Default), any payment to be made in respect of the Instruments, Receipts or the Coupons by the relevant Issuer or the Trustee may be made as provided in the Conditions and any payment so made shall (subject to Clause 2.5 (Payment after a Default)) to that extent be a good discharge to such Issuer or the Trustee, as the case may be (including, in the case of Instruments represented by a NGN, whether or not the corresponding entries have been made in the records of Euroclear and Clearstream, Luxembourg), except to the extent that there is failure in its subsequent payment to the relevant Instrumentholders or Couponholders under the Conditions. | ||
2.5 | Payment after a Default | |
At any time after an Event of Default or a Potential Event of Default has occurred the Trustee may: |
2.5.1 | by notice in writing to the relevant Issuer and the Paying Agents, require the Paying Agents, until notified by the Trustee to the contrary, so far as permitted by applicable law: |
(i) | to act as Paying Agents of the Trustee under this Trust Deed and the Instruments on the terms of the Agency Agreement (with consequential amendments as necessary and except that the Trustees liability for the indemnification, remuneration and expenses of the Paying Agents shall be limited to the amounts for the time being held by the Trustee in respect of the Instruments on the terms of this Trust Deed) and thereafter to hold all Instruments, Receipts, Coupons and Talons and all moneys, documents and records held by them in respect of Instruments, Receipts, Coupons and Talons to the order of the Trustee; or |
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(ii) | to deliver all Instruments, Receipts, Coupons and Talons and all moneys, documents and records held by them in respect of the Instruments, Receipts, Coupons and Talons to the Trustee or as the Trustee directs in such notice; and |
2.5.2 | by notice in writing to the relevant Issuer, require such Issuer to make all subsequent payments in respect of the Instruments, Receipts, Coupons and Talons to or to the order of the Trustee and not to the Issuing and Paying Agent and with effect from the receipt of any such notice by such Issuer, until such notice is withdrawn, the first proviso to Clause 2.3 (Covenant to Pay) shall cease to have effect. |
2.6 | Rate of Interest after a Default | |
If the Instruments bear interest at a floating or other variable rate and they become immediately payable under the Conditions following an Event of Default, the rate of interest payable in respect of them shall continue to be calculated by the Calculation Agent in accordance with the Conditions (with consequential amendments as necessary) except that the rates of interest need not be notified to Instrumentholders. The first period in respect of which interest shall be so calculable shall commence on the expiry of the Interest Period during which the Instruments become so repayable. | ||
3 | Form of the Instruments | |
3.1 | The Global Instruments | |
The Instruments shall initially be represented by a temporary Global Instrument or a permanent Global Instrument in the nominal amount of the Tranche being issued. Interests in a temporary Global Instrument shall be exchangeable for Definitive Instruments or interests in a permanent Global Instrument as set out in each temporary Global Instrument. Interests in a permanent Global Instrument shall be exchangeable for Definitive Instruments as set out in such permanent Global Instrument. | ||
3.2 | The Definitive Instruments | |
The Definitive Instruments, Receipts, Coupons and Talons shall be security printed in accordance with applicable legal and stock exchange requirements substantially in the forms set out in Schedule 2. The Instruments shall be endorsed with the Conditions. | ||
3.3 | Signature | |
The Instruments, Receipts, Coupons and Talons shall be signed manually or in facsimile by an authorised signatory of the relevant Issuer and the Instruments shall be authenticated by or on behalf of the Issuing and Paying Agent. The relevant Issuer may use the facsimile signature of any person who at the date of this Trust Deed is such an authorised signatory even if at the time of issue of any Instruments, Receipts, Coupons or Talons he no longer holds that office. In the case of a Global Instrument which is a NGN, the Issuing and Paying Agent shall also instruct the Common Safekeeper to effectuate the same. Instruments, Receipts, Coupons and Talons so executed and authenticated (and effectuated, if applicable) shall be binding and valid obligations of the relevant Issuer. Execution in facsimile of any Instruments and any photostatic copying or other duplication of any Global Instruments (in unauthenticated form, but executed manually on behalf of the |
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relevant Issuer as stated above) shall be binding upon such Issuer in the same manner as if such Instruments were signed manually by such signatories. | ||
3.4 | Title | |
The holder of any Instrument, Receipt, Coupon or Talon shall (save as otherwise required by law) be treated as its absolute owner for all purposes (whether or not it is overdue and regardless of any notice of ownership, trust or any interest in it, any writing on it or its theft or loss) and no person will be liable for so treating the holder. | ||
4 | Stamp Duties and Taxes | |
4.1 | Stamp Duties | |
Each Issuer shall pay any stamp, issue, documentary or other taxes and duties payable in the United Kingdom in respect of the creation, issue and offering of the Instruments issued by it and the related Receipts, Coupons and Talons and the execution or delivery of this Trust Deed. Each Issuer shall also indemnify the Trustee, the relevant Instrumentholders and the Couponholders from and against all stamp, issue, documentary or other taxes paid by any of them in any jurisdiction in connection with any action taken by or on behalf of the Trustee or, as the case may be (where entitled to do so), the relevant Instrumentholders or the Couponholders to enforce the relevant Issuers obligations under this Trust Deed or the relevant Instruments, Receipts, Coupons or Talons. | ||
4.2 | Change of Taxing Jurisdiction | |
If an Issuer becomes subject generally to the taxing jurisdiction of a territory or a taxing authority of or in that territory with power to tax other than or in addition to the United Kingdom or any such authority of or in such territory then such Issuer shall (unless the Trustee otherwise agrees) give the Trustee an undertaking satisfactory to the Trustee in terms corresponding to the terms of Condition 7 with the substitution for, or (as the case may require) the addition to, the references in that Condition to the United Kingdom of references to that other or additional territory or authority to whose taxing jurisdiction such Issuer has become so subject. In such event this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons shall be read accordingly. | ||
5 | Application of Moneys Received by the Trustee | |
5.1 | Declaration of Trust | |
All moneys received by the Trustee in respect of the Instruments or amounts payable under this Trust Deed shall, despite any appropriation of all or part of them by the relevant Issuer, be held by the Trustee on trust to apply them (subject to Clause 5.2 (Accumulation)): |
5.1.1 | first, in payment of all costs, charges, expenses and liabilities reasonably incurred by the Trustee (including remuneration payable to it) in carrying out its functions under this Trust Deed; | ||
5.1.2 | secondly, in payment of any amounts owing in respect of the relevant Instruments, Receipts or Coupons pari passu and rateably; and | ||
5.1.3 | thirdly, in payment of any balance to such Issuer for itself. |
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If the Trustee holds any moneys which represent principal, premium or interest in respect of Instruments, Receipts or Coupons which have become void in accordance with the Conditions the Trustee shall hold them on these trusts. | ||
5.2 | Accumulation | |
If the amount of the moneys at any time available for payment in respect of the Instruments under Clause 5.1 (Declaration of Trust) is less than 10 per cent of the nominal amount of the Instruments then outstanding, the Trustee may, at its discretion, invest such moneys as provided in Clause 5.3 (Investment). The Trustee may retain such investments and accumulate the resulting income until the investments and the accumulations, together with any other funds for the time being under its control and available for such payment, amount to at least 10 per cent of the nominal amount of the Instruments then outstanding and then such investments, accumulations and funds (after deduction of, or provision for, any applicable taxes) shall be applied as specified in Clause 5.1 (Declaration of Trust). | ||
5.3 | Investment | |
Moneys held by the Trustee may be invested in its name or under its control in any investments or other assets anywhere, whether or not they produce income, or deposited in its name or under its control at such bank or other financial institution in such currency as the Trustee may, in its absolute discretion, think fit. If that bank or institution is the Trustee or a subsidiary, parent or associated undertaking of the Trustee, it need only account for an amount of interest equal to the standard amount of interest payable by it on such a deposit to an independent customer. The Trustee may at any time vary or transpose any such investments or assets or convert any moneys so deposited into any other currency, and shall not be responsible for any resulting loss, whether by depreciation in value, change in exchange rates or otherwise. | ||
6 | Covenants | |
So long as any Instrument issued by it is outstanding, each of the Issuers shall: | ||
6.1 | Books of Account | |
Keep, and procure that each of its subsidiary undertakings keeps, proper books of account and, at any time after an Event of Default has occurred or if the Trustee reasonably believes that such an event has occurred, so far as permitted by applicable law, allow, and procure that each such subsidiary undertaking shall allow, the Trustee and anyone appointed by it to whom the relevant Issuer and/or the relevant subsidiary undertaking has no reasonable objection, access to its books of account at all reasonable times during normal business hours. | ||
6.2 | Notice of Events of Default | |
Notify the Trustee in writing immediately on becoming aware of the occurrence of any Event of Default or Potential Event of Default. | ||
6.3 | Information | |
So far as permitted by applicable law, give the Trustee such information as it reasonably requires to perform its functions. |
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6.4 | Financial Statements etc. |
6.4.1 | send to the Trustee at the time of their issue and, in the case of annual financial statements, in any event within 180 days of the end of each financial year, three copies in English of every balance sheet, profit and loss account, report or other notice, statement or circular issued, or that legally or contractually should be issued, to the members or creditors (or any class of them) of the relevant Issuer or any parent undertaking of it generally in their capacity as such; and | ||
6.4.2 | National Grid shall, forthwith upon becoming aware of the occurrence of a National Grid Restructuring Event, provide or procure that the Reporting Accountants provide the Trustee with the Accountants Report; |
6.5 | Certificate of Director, etc. |
6.5.1 | send to the Trustee, within 14 days of its annual audited financial statements being made available to its members, and also within 21 days of any request by the Trustee a certificate of the relevant Issuer signed by a Director that, having made all reasonable enquiries, to the best of the knowledge, information and belief of such Issuer as at a date (the Certification Date ) not more than five days before the date of the certificate no Event of Default or Potential Event of Default had occurred (and, in the case of a Potential Event of Default, was continuing) since the Certification Date of the last such certificate or (if none) the date of this Trust Deed or, if such an event had occurred (and, in the case of a Potential Event of Default, was continuing), giving details of it and certifying that it has complied with its obligations under this Trust Deed or, to the extent that it has failed so to comply, stating such; | ||
6.5.2 | National Grid shall, forthwith upon becoming aware of the occurrence of a National Grid Restructuring Event, notify the Trustee in writing of the occurrence of an National Grid Restructuring Event and provide the Trustee with the Directors Report; and | ||
6.5.3 | in relation to Instruments issued by it, National Grid shall give to the Trustee, as soon as reasonably practicable after the acquisition or disposal of any company which thereby becomes a Principal Subsidiary or after any transfer is made to any member of the National Grid Group (as defined in Condition 9(c)) which thereby becomes a Principal Subsidiary, a certificate by the auditors of National Grid at that time (the Auditors ) addressed to the Trustee to such effect; |
6.6 | Notices to Instrumentholders | |
Obtain the prior written approval of the Trustee to, and promptly give to the Trustee two copies of, the form of every notice given to the Instrumentholders in accordance with Condition 14 (such approval, unless so expressed, not to constitute approval for the purposes of Section 21 of the Financial Services and Markets Act 2000 any such notice which is a communication within the meaning of that section). | ||
6.7 | Further Acts | |
So far as permitted by applicable law, do such further things as may be necessary in the reasonable opinion of the Trustee to give effect to this Trust Deed. |
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6.8 | Notice of Late Payment | |
Forthwith upon request by the Trustee (if the Trustee determines such notice is necessary) give notice to the Instrumentholders of any unconditional payment to the Issuing and Paying Agent or the Trustee of any sum due in respect of the Instruments, the Receipts or Coupons made after the due date for such payment. | ||
6.9 | Listing | |
If the Instruments are so listed, use all reasonable endeavours to maintain the listing of the Instruments but, if it is unable to do so, having used such endeavours, or if the maintenance of such listing is agreed by the Trustee to be unduly onerous and the Trustee is satisfied that the interests of the Instrumentholders would not by such action be materially prejudiced, instead use all reasonable endeavours to obtain and maintain a listing of the Instruments on another stock exchange approved in writing by the Trustee. | ||
6.10 | Change in Agents | |
Give at least 14 days prior notice to the Instrumentholders in accordance with the Conditions of any future appointment, resignation or removal of an Agent or of any change by an Agent of its specified office. | ||
6.11 | Provision of Legal Opinions | |
Procure the delivery of legal opinions addressed to the Trustee dated the date of such delivery, in form and content acceptable to the Trustee: |
6.11.1 | from Clifford Chance LLP (or such other firm of legal advisers as may be agreed between the relevant Issuer and the Trustee) as to the laws of England before the first issue of Instruments occurring after each anniversary of this Trust Deed or, if later, 12 months after the date of delivery of the latest such legal opinion and on the date of any amendment to this Trust Deed; | ||
6.11.2 | unless the relevant Issuer has notified the Dealers and the Trustee in writing that it does not intend to issue Instruments under the Programme for the time being, from legal advisers reasonably acceptable to the Trustee as to such law as may reasonably be requested by the Trustee and in such form and with such content as the Trustee may require, on such occasions as the Trustee so requests on the basis that the Trustee considers it prudent in view of a change (or proposed change) in (or in the interpretation or application of) any applicable law, regulation or circumstance materially affecting the relevant Issuer, the Trustee, the relevant Instruments, the Certificates, the Receipts, the Coupons, the Talons, this Trust Deed or the Agency Agreement; and | ||
6.11.3 | on each occasion on which a legal opinion is given to any Dealer pursuant to the Dealer Agreement from the legal adviser giving such opinion; |
6.12 | Instruments Held by an Issuer | |
Send to the Trustee as soon as practicable after being so requested by the Trustee a certificate of the relevant Issuer signed by any Director or the Company Secretary stating the number of Instruments held at the date of such certificate by or on behalf of such Issuer or its subsidiary undertakings. |
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6.13 | Obligations of Agents | |
Comply with and perform all its obligations under the Agency Agreement and use all reasonable endeavours to procure that the Agents comply with and perform all their respective obligations thereunder and not make any amendment or modification to the Agency Agreement without the prior written approval of the Trustee. | ||
6.14 | Copies of Dealer Agreement | |
Provide the Trustee promptly with copies of all supplements and/or amendments to, and/or restatements of, the Dealer Agreement. | ||
7 | Remuneration and Indemnification of the Trustee | |
7.1 | Normal Remuneration | |
So long as any Instrument is outstanding the relevant Issuer shall pay the Trustee as remuneration for its services as Trustee such sum on such dates in each case as they may from time to time agree. Such remuneration shall accrue from day to day from the date of this Trust Deed. However, if any payment to an Instrumentholder or Couponholder of moneys due in respect of any Instrument, Receipts or Coupon is improperly withheld or refused, such remuneration shall again accrue as from the date of such withholding or refusal until payment to such Instrumentholder or Couponholder is duly made. | ||
7.2 | Extra Remuneration | |
If an Event of Default shall have occurred or if the Trustee finds it expedient or necessary or is requested by an Issuer to undertake duties that they both agree to be of an exceptional nature or otherwise outside the scope of the Trustees normal duties under this Trust Deed, such Issuer shall pay such additional remuneration as they may agree or, failing agreement as to any of the matters in this Clause 7 (or as to such sums referred to in Clause 7.1 (Normal Remuneration)), as determined by a financial institution (acting as an expert) selected by the Trustee and approved by such Issuer or, failing such approval, nominated by the President for the time being of The Law Society of England and Wales. The expenses involved in such nomination and such financial institutions fee shall be shared equally between the Trustee and the relevant Issuer. The determination of the relevant financial institution shall be conclusive and binding on the relevant Issuer, the Trustee, the relevant Instrumentholders and the relevant Couponholders. | ||
7.3 | Expenses | |
Each of the Issuers (in respect of itself and, where applicable, Instruments issued by it) shall also, on demand by the Trustee, pay or discharge all costs, charges, liabilities and expenses reasonably incurred by the Trustee in the preparation and execution of this Trust Deed and the performance of its functions under this Trust Deed in relation to that Issuer including, but not limited to, legal and travelling expenses and any United Kingdom stamp, documentary or other taxes or duties paid by the Trustee in connection with any legal proceedings reasonably brought or contemplated by the Trustee against an Issuer (in respect of Instruments issued by it) to enforce any provision of this Trust Deed, the relevant Instruments, the Receipts, the Coupons or the Talons and in addition shall pay to the Trustee (if required) an amount equal to the amount of any value added tax or similar tax chargeable in respect of the Trustees remuneration under this Trust Deed. Such costs, charges, liabilities and expenses shall: |
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7.3.1 | in the case of payments made by the Trustee before such demand, carry interest from the date of the demand at the rate of one per cent. per annum over the base rate of The Royal Bank of Scotland plc on the date on which the Trustee made such payments; and | ||
7.3.2 | in other cases, carry interest at such rate from 30 days after the date of the demand or (where the demand specifies that payment is to be made on an earlier date) from such earlier date provided that in such event no such interest shall accrue unless payment is actually made on such earlier date. |
7.4 | Notice of Costs | |
The Trustee shall wherever practicable give prior notice to the relevant Issuer of any costs, charges and expenses properly to be incurred and of payments to be made by the Trustee in the lawful exercise of its powers under this Trust Deed so as to afford such Issuer a reasonable opportunity to meet such costs, charges and expenses itself or to put the Trustee in funds to make payment of such costs, charges and expenses. However, failure of the Trustee to give any such prior notice shall not prejudice its rights to reimbursement of such costs, charges and expenses under this Clause 7. | ||
7.5 | Indemnity | |
Each of the Issuers (in respect of itself and, where applicable, any Instruments issued by it) shall indemnify the Trustee in respect of all liabilities and expenses properly incurred by it or by anyone appointed by it or to whom any of its functions may be delegated by it in the carrying out of its functions and against any loss, liability, cost, claim, action, demand or expense (including, but not limited to, all costs, charges and expenses properly paid or incurred in disputing or defending any of the foregoing) which any of them may incur in relation to the relevant Issuer or that may be made against any of them arising out of or in relation to or in connection with, its appointment or the exercise of its functions in relation to that Issuer. | ||
7.6 | Continuing Effect | |
Clauses 7.3 (Expenses) and 7.5 (Indemnity) shall continue in full force and effect as regards the Trustee even if it no longer is Trustee. | ||
7.7 | Determination of Series | |
The Trustee shall be entitled in its absolute discretion to determine in respect of which Series of Instruments any costs, charge, liabilities and expenses incurred under this Trust Deed have been incurred or to allocate any such costs, charges, liabilities and expenses between the Instruments of any two or more Series. | ||
8 | Provisions Supplemental to the Trustee Acts | |
8.1 | Advice | |
The Trustee may act on the opinion or advice of, or information obtained from, any expert (including, without limitation, any report or advice received from an independent financial adviser or from any accountant pursuant to the Conditions), whether or not (1) such opinion, advice or information is addressed to the Trustee or any other person, and (2) such experts liability in respect of the same is limited by reference to a monetary cap or |
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otherwise and shall not be responsible to anyone for any loss occasioned by so acting. Any such opinion, advice or information may be sent or obtained by letter or fax and the Trustee shall not be liable to anyone for acting in good faith on any opinion, advice or information purporting to be conveyed by such means even if it contains some error or is not authentic. | ||
8.2 | Trustee to Assume Performance | |
The Trustee need not notify anyone of the execution of this Trust Deed or do anything to find out if an National Grid Restructuring Event or NGET Restructuring Event, an Event of Default or Potential Event of Default has occurred. Until it has actual knowledge or express notice to the contrary, the Trustee may assume that no such event has occurred and that each Issuer is performing all of its obligations under this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons provided that the Trustee shall not be treated for any purposes as having any notice or knowledge which has been obtained by it or any officer or employee of it in some capacity other than as Trustee under this Trust Deed or in a private or confidential capacity such that it would not be proper to disclose to third parties. | ||
8.3 | Resolutions of Instrumentholders | |
The Trustee shall not be responsible for having acted in good faith on a resolution purporting to have been passed at a meeting of Instrumentholders in respect of which minutes have been made and signed even if it is later found that there was a defect in the constitution of the meeting or the passing of the resolution or that the resolution was not valid or binding on the Instrumentholders or Couponholders. | ||
8.4 | Certificate Signed by Directors, etc. | |
If the Trustee, in the exercise of its functions, requires to be satisfied or to have information as to any fact or the expediency of any act, it may call for and accept as sufficient evidence of that fact or the expediency of that act a certificate signed by any two Directors of the relevant Issuer as to that fact or to the effect that, in their opinion, that act is expedient and the Trustee need not call for further evidence and shall not be responsible for any loss occasioned by acting on such a certificate. | ||
8.5 | Deposit of Documents | |
The Trustee may deposit this Trust Deed and any other documents with any bank or entity whose business includes the safe custody of documents or with any lawyer or firm of lawyers believed by it to be of good repute and may pay all sums due in respect of them. | ||
8.6 | Discretion | |
The Trustee shall have absolute and uncontrolled discretion as to the exercise of its functions and shall not be responsible for any loss, liability, cost, claim, action, demand, expense or inconvenience which may result from their exercise or non-exercise. | ||
8.7 | Agents | |
Whenever it considers it expedient in the interests of the Instrumentholders, the Trustee may, in the conduct of its trust business, instead of acting personally, employ and pay an agent selected by it, whether or not a lawyer or other professional person, to transact or conduct, or concur in transacting or conducting, any business and to do or concur in doing |
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all acts required to be done by the Trustee (including the receipt and payment of money). The Trustee shall not be responsible to anyone for any misconduct or omission by any such agent so employed by it or be bound to supervise the proceedings or acts of any such agent. | ||
8.8 | Delegation | |
Whenever it considers it expedient in the interests of the Instrumentholders, the Trustee may delegate to any person on any terms (including power to sub-delegate) all or any of its functions. If the Trustee exercises reasonable care in selecting such delegate, it shall not have any obligation to supervise such delegate or be responsible for any loss, liability, cost, claim, action, demand or expense incurred by reason of any misconduct or default by any such delegate or sub-delegate. | ||
8.9 | Nominees | |
In relation to any asset held by it under this Trust Deed, the Trustee may appoint any person to act as its nominee on any terms. | ||
8.10 | Forged Instruments | |
The Trustee shall not be liable to the relevant Issuer or any relevant Instrumentholder or Couponholder by reason of having accepted as valid or not having rejected any relevant Instrument, Certificate, Receipt, Coupon or Talon purporting to be such and later found to be forged or not authentic. | ||
8.11 | Confidentiality | |
Unless ordered to do so by a court of competent jurisdiction, the Trustee shall not be required to disclose to any Instrumentholder or Couponholder any confidential financial or other information made available to the Trustee by the relevant Issuer. | ||
8.12 | Determinations Conclusive | |
As between itself and the Instrumentholders and Couponholders, the Trustee may determine all questions and doubts arising in relation to any of the provisions of this Trust Deed. Such determinations, whether made upon such a question actually raised or implied in the acts or proceedings of the Trustee, shall be conclusive and shall bind the Trustee, the Instrumentholders and the Couponholders. | ||
8.13 | Currency Conversion | |
Where it is necessary or desirable to convert any sum from one currency to another, it shall (unless otherwise provided hereby or required by law) be converted at such rate or rates, in accordance with such method and as at such date as may reasonably be specified by the Trustee but having regard to current rates of exchange, if available. Any rate, method and date so specified shall be binding on the relevant Issuer and the relevant Instrumentholders and Couponholders. | ||
8.14 | Payment for and Delivery of Instruments | |
The Trustee shall not be responsible for the receipt or application by the relevant Issuer of the proceeds of the issue of any relevant Instruments, any exchange of relevant Instruments or the delivery of relevant Instruments to the persons entitled to them. |
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8.15 | Trustees consent | |
Any consent given by the Trustee for the purposes of this Trust Deed may be given on such terms as the Trustee thinks fit. In giving such consent the Trustee may require the Issuers to agree to such modifications or additions to this Trust Deed as the Trustee may deem expedient in the interest of the Instrumentholders. | ||
8.16 | Instruments Held by an Issuer etc. | |
In the absence of knowledge or express notice to the contrary, the Trustee may assume without enquiry (other than requesting a certificate under Clause 6.12 (Instruments Held by an Issuer)) that no Instruments are for the time being held by or on behalf of an Issuer or its subsidiary undertakings. | ||
8.17 | Legal Opinions | |
The Trustee shall not be responsible to any person for failing to request, require or receive any legal opinion relating to any Instruments or for checking or commenting upon the content of any such legal opinion. | ||
8.18 | Programme Limit | |
The Trustee shall not be concerned, and need not enquire, as to whether or not any Instruments are issued in breach of the Programme Limit. | ||
8.19 | Events of Default | |
The Trustee may determine whether or not an Event of Default is in its opinion capable of remedy or (in relation to Condition 9(b)) materially prejudicial to the interests of relevant Instrumentholders. Any such determination shall be conclusive and binding on the relevant Issuer and the relevant Instrumentholders. | ||
8.20 | Appointment of Independent Financial Adviser | |
In connection with the Trustees right to appoint an independent financial adviser pursuant to Condition 5.6.2 (if applicable), the Trustee: |
8.20.1 | shall use its reasonable endeavours to identify and appoint the independent financial adviser but shall have no liability to any person if, having used its reasonable endeavours, it is unable to identify and appoint a suitable independent financial adviser; | ||
8.20.2 | shall not be responsible for carrying on the role of independent financial adviser itself during the time it is attempting to identify such independent financial adviser or thereafter if it is unable to find such independent financial adviser; and | ||
8.20.3 | shall not be required to take any action to find an independent financial adviser unless it has been previously indemnified and/or secured to its satisfaction or expend any of its own funds in the appointment of such an independent financial adviser. |
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9 | Disapplication and Trustee Liability | |
9.1 | Disapplication | |
Section 1 of the Trustee Act 2000 shall not apply to the duties of the Trustee in relation to the trusts constituted by this Trust Deed. Where there are any inconsistencies between the Trustee Acts and the provisions of this Trust Deed, the provisions of this Trust Deed shall, to the extent allowed by law, prevail and, in the case of any such inconsistency with the Trustee Act 2000, the provisions of this Trust Deed shall constitute a restriction or exclusion for the purposes of that Act. | ||
9.2 | Trustee Liability | |
Subject to Sections 750 and 751 of the Companies Act 2006 (if applicable) and notwithstanding anything to the contrary in this Trust Deed, the Instruments or the Paying Agency Agreement, the Trustee shall not be liable to any person for any matter or thing done or omitted in any way in connection with or in relation to this Trust Deed, the Instruments or the Agency Agreement save in relation to its own gross negligence, wilful default or fraud. | ||
10 | Waiver and Proof of Default | |
10.1 | Waiver | |
The Trustee may, without the consent of the Instrumentholders or Couponholders and without prejudice to its rights in respect of any subsequent breach, from time to time and at any time, if in its opinion the interests of the Instrumentholders will not be materially prejudiced thereby, waive or authorise, on such terms as seem expedient to it, any breach or proposed breach by an Issuer of this Trust Deed or the Conditions or determine that an Event of Default or Potential Event of Default shall not be treated as such provided that the Trustee shall not do so in contravention of an express direction given by an Extraordinary Resolution or a request made pursuant to Condition 9. No such direction or request shall affect a previous waiver, authorisation or determination. Any such waiver, authorisation or determination shall be binding on the relevant Instrumentholders and the Couponholders and, if the Trustee so requires, shall be notified to the Instrumentholders as soon as practicable. | ||
10.2 | Proof of Default | |
Proof that the relevant Issuer has failed to pay a sum due to the holder of any one Instrument, Receipt or Coupon shall (unless the contrary be proved) be sufficient evidence that it has made the same default as regards all other Instruments, Receipts or Coupons which are then payable. | ||
11 | Trustee not Precluded from Entering into Contracts | |
The Trustee and any other person, whether or not acting for itself, may acquire, hold or dispose of any Instrument, Receipt, Coupon, Talon or other security (or any interest therein) of either of the Issuers or any other person, may enter into or be interested in any contract or transaction with any such person and may act on, or as depositary or agent for, any committee or body of holders of any securities of any such person in each case with the same rights as it would have had if the Trustee were not acting as Trustee and need not account for any profit. |
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12 | Modification and Substitution | |
12.1 | Modification | |
The Trustee may agree without the consent of the Instrumentholders or Couponholders to any modification to this Trust Deed of a formal, minor or technical nature or to correct a manifest error. The Trustee may also so agree to any other modification to this Trust Deed which is in its opinion not materially prejudicial to the interests of the Instrumentholders of the relevant Series, but such power does not extend to any such modification as is mentioned in the proviso to paragraph 2 of Schedule 3 (Provisions for Meetings of Instrumentholders). Any such modification, authorisation or waiver shall be binding on the relevant Instrumentholders and Couponholders and if the Trustee so requires, such modification shall be notified to the relevant Instrumentholders as soon as practicable. | ||
12.2 | Substitution |
12.2.1 | The Trustee may, without the consent of the Instrumentholders or Couponholders, agree to the substitution of any other company (the Substituted Obligor ) in place of such Issuer (or of any previous substitute under this Clause 12) as the principal debtor under this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons provided that such substitution would not, in the opinion of the Trustee, be materially prejudicial to the interests of the Instrumentholders, and further provided that : |
(i) | a deed is executed or undertaking given by the Substituted Obligor to the Trustee, in form and manner satisfactory to the Trustee, agreeing to be bound by this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons (with consequential amendments as the Trustee may deem appropriate) as if the Substituted Obligor had been named in this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons as the principal debtor in place of such Issuer; | ||
(ii) | if the Substituted Obligor is subject generally to the taxing jurisdiction of a territory or any authority of or in that territory with power to tax (the Substituted Territory ) other than the territory to the taxing jurisdiction of which (or to any such authority of or in which) such Issuer is subject generally (the Issuers Territory ), the Substituted Obligor shall (unless the Trustee otherwise agrees) give to the Trustee an undertaking satisfactory to the Trustee in terms corresponding to Condition 7 with the substitution for the references in that Condition to such Issuers Territory of references to the Substituted Territory whereupon the Trust Deed, and the relevant Instruments, Receipts, Coupons and Talons shall be read accordingly; | ||
(iii) | if any two Directors of the Substituted Obligor certify that it will be solvent immediately after such substitution, the Trustee need not have regard to the Substituted Obligors financial condition, profits or prospects or compare them with those of such Issuer; | ||
(iv) | such Issuer and the Substituted Obligor comply with such other requirements as the Trustee may direct in the interests of the relevant Instrumentholders; and |
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(v) | the Trustee is satisfied that (i) the Substituted Obligor has obtained all necessary governmental and regulatory approvals and consents necessary for its assumption of liability as principal debtor in respect of the relevant Instruments in place of such Issuer (or a previous substitute), (ii) all necessary governmental and regulatory approvals and consents necessary for or in connection with the assumption by the Substituted Obligor of its obligations under the relevant Instruments and Coupons and (iii) such approvals and consents are at the time of substitution in full force and effect. |
12.2.2 | Release of Substituted Issuer | ||
An agreement by the Trustee pursuant to Clause 12.2 (Substitution) shall, if so expressed, release the relevant Issuer (or a previous substitute) from any or all of its obligations under this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons. Notice of the substitution shall be given to the Instrumentholders within 14 days of the execution of such documents and compliance with such requirements. | |||
12.2.3 | Completion of Substitution | ||
On completion of the formalities set out in Clause 12.2 (Substitution), the Substituted Obligor shall be deemed to be named in this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons as the principal debtor in place of the relevant Issuer (or of any previous substitute) and this Trust Deed and the relevant Instruments, Receipts, Coupons and Talons shall be deemed to be amended as necessary to give effect to the substitution. |
13 | Appointment, Retirement and Removal of the Trustee | |
13.1 | Appointment | |
Each of the Issuers has the power of appointing new trustees but no one may be so appointed unless previously approved by an Extraordinary Resolution. The Trustee shall at all times be a trust corporation and such trust corporation may be the sole Trustee. Any appointment of a new Trustee shall be notified by each of the Issuers to its Instrumentholders in accordance with Condition 14 as soon as practicable. | ||
13.2 | Retirement and Removal | |
Any Trustee may retire at any time on giving at least three months written notice to each of the Issuers without giving any reason or being responsible for any costs occasioned by such retirement and the Instrumentholders may by Extraordinary Resolution remove any Trustee provided that the retirement or removal of a sole trust corporation shall not be effective until a trust corporation is appointed as successor Trustee. If a sole trust corporation gives notice of retirement or an Extraordinary Resolution is passed for its removal, it shall use all reasonable endeavours to procure that another trust corporation is appointed as Trustee. | ||
13.3 | Co-Trustees | |
The Trustee may, despite Clause 13.1 (Appointment), by written notice to each of the Issuers, appoint anyone to act either as a separate Trustee in respect of any Issue or as an additional Trustee jointly with the Trustee: |
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13.3.1 | if the Trustee considers the appointment to be in the interests of the Instrumentholders and/or the Couponholders; | ||
13.3.2 | to conform with a legal requirement, restriction or condition in a jurisdiction in which a particular act is to be performed; or | ||
13.3.3 | to obtain a judgment or to enforce a judgment or any provision of this Trust Deed in any jurisdiction. |
Subject to the provisions of this Trust Deed the Trustee may, in the instrument of appointment, confer on any person so appointed such functions as it thinks fit. The Trustee may by written notice to each of the Issuers and that person remove that person. At the Trustees request, each Issuer shall forthwith do all things as may be required to perfect such appointment or removal and each of the Issuers irrevocably appoints the Trustee as its attorney in its name and on its behalf to do so. | ||
Before appointing such person to act as separate Trustee or additional Trustee the Trustee shall (unless it is not, in the opinion of the Trustee, reasonably practicable to do so) give notice to each of the Issuers of its intention to make such appointment (and the reason for that) and shall give due consideration to representations made by each of the Issuers concerning such appointment. Where, as a result of this provision, not all the Instruments have the same Trustee, the provisions of this Trust Deed shall apply in respect of each such Trustee as if each were named as a party to this Trust Deed. |
13.4 | Competence of a Majority of Trustees | |
If there are more than two Trustees the majority of them shall be competent to perform the Trustees functions provided the majority includes a trust corporation. | ||
14 | Instruments held in Clearing Systems and Couponholders | |
14.1 | Instruments Held in Clearing Systems | |
So long as any Global Instrument is held on behalf of a clearing system, in considering the interests of Instrumentholders, the Trustee may have regard to any information provided to it by such clearing system or its operator as to the identity (either individually or by category) of its accountholders or participants with entitlements to any such Global Instrument and may consider such interests on the basis that such accountholders or participants were the holder(s) of such Global Instrument. | ||
14.2 | Reliance on Instruments Held in Clearing Systems | |
The Trustee and any Issuer may call for and, except in the case of manifest error, shall be at liberty to accept and place full reliance on as sufficient evidence thereof any certificate, letter of confirmation or other document issued on behalf of Euroclear or Clearstream, Luxembourg or any form of record made by any of them or such other evidence and/or information and/or certification as it shall, in its absolute discretion, think fit to the effect that at any particular time or throughout any particular period any particular person is, was, or will be, shown in its records as the holder of a particular nominal amount of Instruments represented by a Global Instrument and if the Trustee or any Issuer does so rely, such letter of confirmation, form of record, evidence, information or certification shall be conclusive and binding on all concerned for all purposes. Any such certificate may comprise any form of statement or print out of electronic records provided by the relevant clearing system (including Euroclears EUCLID or Clearstream, Luxembourgs Creation |
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Online system) in accordance with its usual procedures and in which the holder of a particular nominal amount of Instruments is clearly identified together with the amount of such holding. Neither an Issuer nor the Trustee shall be liable to any person by reason of having accepted as valid or not having rejected any certificate or other document to such effect purporting to be issued by Euroclear or Clearstream, Luxembourg and subsequently found to be forged or not authentic. | ||
14.3 | Couponholders | |
No notices need be given to Couponholders. They shall be deemed to have notice of the contents of any notice given to Instrumentholders. Even if it has express notice to the contrary, in exercising any of its functions by reference to the interests of the Instrumentholders, the Trustee shall assume that the holder of each Instrument is the holder of all Receipts, Coupons and Talons relating to it. | ||
15 | Currency Indemnity | |
15.1 | Currency of Account and Payment | |
The Contractual Currency is the sole currency of account and payment for all sums payable by each of the Issuers under or in connection with this Trust Deed, the Instruments, the Receipts and the Coupons, including damages. | ||
15.2 | Extent of Discharge | |
An amount received or recovered in a currency other than the Contractual Currency (whether as a result of, or of the enforcement of, a judgment or order of a court of any jurisdiction, in the insolvency, winding-up or dissolution of either of the Issuers or otherwise), by the Trustee or any Instrumentholder or Couponholder in respect of any sum expressed to be due to it from the relevant Issuer, shall only discharge such Issuer to the extent of the Contractual Currency amount which the recipient is able to purchase with the amount so received or recovered in that other currency on the date of that receipt or recovery (or, if it is not practicable to make that purchase on that date, on the first date on which it is practicable to do so). | ||
15.3 | Indemnity | |
If that Contractual Currency amount is less than the Contractual Currency amount expressed to be due to the recipient under this Trust Deed, the Instruments, the Receipts or the Coupons, the relevant Issuer shall indemnify the recipient against any loss sustained by it as a result. In any event, the relevant Issuer shall indemnify the recipient against the cost of making any such purchase. | ||
15.4 | Indemnity Separate | |
The indemnities in this Clause 15 and in Clause 7.5 (Indemnity) constitute separate and independent obligations from the other obligations in this Trust Deed, shall give rise to a separate and independent course of action, shall apply irrespective of any indulgence granted by the Trustee and/or any Instrumentholder or Couponholder and shall continue in full force and effect despite any judgment, order, claim or proof for a liquidated amount in respect of any sum due under this Trust Deed, the Instruments, the Receipts and/or the Coupons or any other judgment or order. |
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16 | Enforcement | |
16.1 | Trustee to enforce | |
Only the Trustee may enforce the rights of the Instrumentholders and Couponholders against the relevant Issuer, whether the same arise under the general law, this Trust Deed, the Instruments, the Coupons or otherwise, and no Instrumentholder or Couponholder shall be entitled to proceed directly against the relevant Issuer unless the Trustee, having become bound to proceed, fails to do so within a reasonable time and such failure is continuing. | ||
16.2 | Trustees Indemnity | |
The Trustee shall not be bound to take any steps to enforce the performance of any provisions of this Trust Deed, the Instruments or the Coupons or to appoint an independent financial advisor pursuant to the Conditions of the Instruments unless it shall be indemnified and/or secured and/or prefunded by the relevant Instrumentholders and/or Couponholders to its satisfaction against all proceedings, claims and demands to which it may be liable and against all costs, charges, liabilities and expenses which may be incurred by it in connection with such enforcement or appointment, including the costs of its managements time and/or other internal resources, calculated using its normal hourly rates in force from time to time. | ||
16.3 | Legal proceedings | |
If the Trustee (or any Instrumentholder or Couponholder where entitled in accordance with this Trust Deed so to do) institutes legal proceedings against the relevant Issuer to enforce any obligations under this Trust Deed: |
16.3.1 | proof in such proceedings that as regards any specified Instrument such Issuer has made default in paying any principal or interest due to the relevant Instrumentholder shall (unless the contrary be proved) be sufficient evidence that such Issuer has made the same default as regards all other Instruments which are then repayable or, as the case may be, in respect of which interest is then payable; and | ||
16.3.2 | proof in such proceedings that as regards any specified Coupon such Issuer has made default in paying any sum due to the relevant Couponholder shall (unless the contrary be proved) be sufficient evidence that such Issuer has made the same default as regards all other Coupons which are then payable. |
16.4 | Powers additional to general powers | |
The powers conferred on the Trustee by this Clause 16 shall be in addition to any powers which may from time to time be vested in the Trustee by general law or as the holder of any Instruments or Coupons. | ||
17 | Communications | |
17.1 | Method | |
Each communication under this Trust Deed shall be made by fax, electronic communication or otherwise in writing. Each communication or document to be delivered to any party under this Trust Deed shall be sent to that party at the fax number, electronic |
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address or postal address, and marked for the attention of the person (if any), from time to time designated by that party to each other party for the purpose of this Trust Deed. The initial telephone number, fax number, electronic address, postal address and person so designated by the parties under this Trust Deed are set out in the Procedures Memorandum. | ||
17.2 | Deemed Receipt | |
Any communication from any party to any other under this Trust Deed shall be effective, (if by fax) when good receipt is confirmed by the recipient following enquiry by the sender, (if by electronic communication) when the relevant receipt of such communication being read is given, or where no read receipt is requested by the sender, when good receipt is confirmed by the recipient following enquiry by the sender and (if in writing) when received, except that a communication received outside normal business hours shall be deemed to be received on the next business day in the city in which the recipient is located. | ||
18 | Governing Law and Jurisdiction | |
18.1 | Governing Law | |
This Trust Deed and any non-contractual obligations arising out of in connection with it shall be governed by, and construed in accordance with, English law. | ||
18.2 | Jurisdiction | |
The courts of England are to have jurisdiction to settle any disputes that may arise out of or in connection with this Trust Deed, the Instruments, the Receipts, the Coupons or the Talons and accordingly any legal action or proceedings arising out of or in connection with this Trust Deed, the Instruments, the Receipts, the Coupons or the Talons ( Proceedings ) may be brought in such courts. Each of the Issuers irrevocably submits to the jurisdiction of such courts and waives any objection to Proceedings in such courts on the ground of venue or on the ground that the Proceedings have been brought in an inconvenient forum. This Clause is for the benefit of each of the Trustee and the relevant Instrumentholders and Couponholders and shall not limit the right of any of them to take Proceedings in any other court of competent jurisdiction nor shall the taking of Proceedings in any one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not). |
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1 | Interpretation and Definitions | |
References in this temporary Global Instrument to the Conditions are to the Terms and Conditions applicable to the Instruments (which are in the form set out in Part B of Schedule 2 (Terms and Conditions of the Instruments) to the amended and restated trust deed (as amended or supplemented as at the Issue Date, the Trust Deed ) dated 26 July 2010 between inter alios the Issuer and The Law Debenture Trust Corporation p.l.c. as trustee, as such form is supplemented and/or modified and/or superseded by the provisions of this temporary Global Instrument (including the supplemental definitions and any modifications or additions set out in the Second Schedule hereto), which in the event of any conflict shall prevail). Other capitalised terms used in this temporary Global Instrument shall have the meanings given to them in the Conditions or the Trust Deed. If the Second Schedule to this temporary Global Instrument specifies that the applicable TEFRA exemption is either C Rules or not applicable, this temporary Global Instrument is a C Rules Instrument, otherwise this temporary Global Instrument is a D Rules Instrument. | ||
2 | Aggregate Nominal Amount | |
The aggregate nominal amount from time to time of this temporary Global Instrument shall be an amount equal to the aggregate nominal amount of the Instruments as shall be shown by the latest entry in the fourth column of the First Schedule to this temporary Global Instrument, which shall be completed by or on behalf of the Issuing and Paying Agent upon (a) the issue of Instruments represented by this temporary Global Instrument, (b) the exchange of the whole or a part of this temporary Global Instrument for a corresponding interest in a permanent Global Instrument or, as the case may be, for Definitive Instruments, (c) the redemption or purchase and cancellation of Instruments represented by this temporary Global Instrument and/or (d) in the case of Partly Paid |
* | Delete as applicable. |
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Instruments, the forfeiture of Instruments represented by this temporary Global Instrument in accordance with the Conditions relating to such Partly Paid Instruments, all as described below. | ||
3 | Promise to Pay | |
Subject as provided in this temporary Global Instrument, the Issuer, for value received, by this temporary Global Instrument promises to pay to the bearer of this temporary Global Instrument, upon presentation and (when no further payment is due in respect of this temporary Global Instrument) surrender of this temporary Global Instrument, on the Maturity Date (or on such earlier date or, if the Maturity Date is specified to be perpetual, on such date as the amount payable upon redemption under the Conditions may become repayable in accordance with the Conditions) the amount payable upon redemption under the Conditions in respect of the aggregate nominal amount of Instruments represented by this temporary Global Instrument and (unless this temporary Global Instrument does not bear interest) to pay interest in respect of the Instruments from the Interest Commencement Date in arrear at the rates, on the dates for payment, and in accordance with the methods of calculation provided for in the Conditions, save that the calculation is made in respect of the total aggregate amount of the Instruments, together with such other sums and additional amounts (if any) as may be payable under the Conditions, in accordance with the Conditions. | ||
4 | Exchange | |
Subject as provided in the Conditions applicable to Partly Paid Instruments, on or after the first day following the expiry of 40 days after the Issue Date (the Exchange Date ), this temporary Global Instrument may be exchanged (free of charge to the holder) in whole or (in the case of a D Rules Instrument only) from time to time in part by its presentation and, on exchange in full, surrender to or to the order of the Issuing and Paying Agent for interests in a permanent Global Instrument or, if so specified in the Second Schedule to this temporary Global Instrument, for Definitive Instruments in an aggregate nominal amount equal to the nominal amount of this temporary Global Instrument submitted for exchange provided that , in the case of any part of a D Rules Instrument submitted for exchange for a permanent Global Instrument or Definitive Instruments, there shall have been Certification with respect to such nominal amount submitted for such exchange dated no earlier than the Exchange Date. | ||
Certification means the presentation to the Issuing and Paying Agent of a certificate or certificates with respect to one or more interests in this temporary Global Instrument, signed by Euroclear or Clearstream, Luxembourg, substantially to the effect set out in Schedule 3 (Provisions for Meetings of Instrumentholders) to the Trust Deed to the effect that it has received a certificate or certificates substantially to the effect set out in Schedule 3 to the Agency Agreement with respect to it and that no contrary advice as to the contents of the certificate has been received by Euroclear or Clearstream, Luxembourg, as the case may be. | ||
Upon the whole or a part of this temporary Global Instrument being exchanged for a permanent Global Instrument, such permanent Global Instrument shall be exchangeable in accordance with its terms for Definitive Instruments. | ||
The Definitive Instruments, for which this temporary Global Instrument or a permanent Global Instrument may be exchangeable, shall be duly executed and authenticated, shall, |
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in the case of Definitive Instruments, have attached to them all Coupons (and, where appropriate, Talons) in respect of interest, and all Receipts in respect of Instalment Amounts, which have not already been paid on this temporary Global Instrument or the permanent Global Instrument, as the case may be, shall be security printed and shall be substantially in the form set out in the relevant Schedules to the Trust Deed as supplemented and/or modified and/or superseded by the terms of the Second Schedule to this temporary Global Instrument. | ||
On any exchange of a part of this temporary Global Instrument for an equivalent interest in a permanent Global Instrument or for Definitive Instruments, as the case may be, the portion of the nominal amount of this temporary Global Instrument so exchanged shall be endorsed by or on behalf of the Issuing and Paying Agent in Part 1 of the First Schedule to this temporary Global Instrument, whereupon the nominal amount of this temporary Global Instrument shall be reduced for all purposes by the amount so exchanged and endorsed. | ||
5 | Benefit of Conditions | |
Except as otherwise specified in this temporary Global Instrument, this temporary Global Instrument is subject to the Conditions and the Trust Deed and, until the whole of this temporary Global Instrument is exchanged for equivalent interests in a permanent Global Instrument or for Definitive Instruments, as the case may be, the holder of this temporary Global Instrument shall in all respects be entitled to the same benefits as if it were the holder of the permanent Global Instrument (or the relevant part of it) or the Definitive Instruments, as the case may be, for which it may be exchanged as if such permanent Global Instrument or Definitive Instruments had been issued on the Issue Date. | ||
6 | Payments | |
No person shall be entitled to receive any payment in respect of the Instruments represented by this temporary Global Instrument which falls due on or after the Exchange Date unless, upon due presentation of this temporary Global Instrument for exchange, delivery of (or, in the case of a subsequent exchange, due endorsement of) a permanent Global Instrument or delivery of Definitive Instruments, as the case may be, is improperly withheld or refused by or on behalf of the Issuer. | ||
Payments due in respect of a D Rules Instrument before the Exchange Date shall only be made in relation to such nominal amount of this temporary Global Instrument with respect to which there shall have been Certification dated no earlier than such due date for payment. | ||
Any payments which are made in respect of this temporary Global Instrument shall be made to its holder against presentation and (if no further payment falls to be made on it) surrender of it at the specified office of the Issuing and Paying Agent or of any other Paying Agent provided for in the Conditions. If any payment in full of principal is made in respect of any Instrument represented by this temporary Global Instrument, the portion of this temporary Global Instrument representing such Instrument shall be cancelled and the amount so cancelled shall be endorsed by or on behalf of the Issuing and Paying Agent in the First Schedule to this temporary Global Instrument (such endorsement being prima facie evidence that the payment in question has been made) upon which the nominal amount of this temporary Global Instrument shall be reduced for all purposes by the amount so cancelled and endorsed. If any other payments are made in respect of the Instruments represented by this temporary Global Instrument, a record of each such |
27
payment shall be endorsed by or on behalf of the Issuing and Paying Agent on an additional schedule to this temporary Global Instrument (such endorsement being prima facie evidence that the payment in question has been made). Condition 6.4(e) and Condition 7(e)(i) will apply to the Definitive Instruments only. | ||
For the purposes of any payments made in respect of this temporary Global Instrument, the words in the relevant place of presentation shall not apply in the definition of business day in Condition 6.6 (Non-Business Days). | ||
7 | Cancellation | |
Cancellation of any Instrument represented by this temporary Global Instrument which is required by the Conditions to be cancelled (other than upon its redemption) shall be effected by reduction in the nominal amount of this temporary Global Instrument representing such Instrument on its presentation to or to the order of the Issuing and Paying Agent for endorsement in the First Schedule to this temporary Global Instrument, upon which the nominal amount of this temporary Global Instrument shall be reduced for all purposes by the amount so cancelled and endorsed. | ||
8 | Notices | |
Notices required to be given in respect of the Instruments represented by this temporary Global Instrument may be given by their being delivered (so long as this temporary Global Instrument is held on behalf of Euroclear and Clearstream, Luxembourg or any other clearing system) to Euroclear, Clearstream, Luxembourg or such other clearing system, as the case may be, or otherwise to the holder of this temporary Global Instrument, rather than by publication as required by the Conditions. | ||
No provision of this temporary Global Instrument shall alter or impair the obligation of the Issuer to pay the principal and premium of and interest on the Instruments when due in accordance with the Conditions. | ||
This temporary Global Instrument shall not be valid or become obligatory for any purpose until authenticated by or on behalf of the Issuing and Paying Agent. | ||
This temporary Global Instrument and all matters arising from or connected with it shall be governed by and construed in accordance with English law. |
* | Delete as applicable. |
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Reason for | ||||||||
decrease in | ||||||||
nominal amount | Nominal amount | |||||||
Amount of | of this | of this | ||||||
decrease in | temporary | temporary | ||||||
nominal amount | Global | Global | Notation made | |||||
of this | Instrument | Instrument on | by or on behalf | |||||
temporary | (exchange, | issue or | of the Issuing | |||||
Global | cancellation or | following such | and Paying | |||||
Date | Instrument | forfeiture) | decrease | Agent | ||||
Issue Date
|
not applicable | not applicable |
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1 | Interpretation and Definitions | |
References in this permanent Global Instrument to the Conditions are to the Terms and Conditions applicable to the Instruments (which are in the form set out in Part B of Schedule 2 (Terms and Conditions of the Instruments) to the amended and restated trust deed (as amended or supplemented as at the Issue Date, the Trust Deed ) dated 26 July 2010 between, inter alios , the Issuer and The Law Debenture Trust Corporation p.l.c. as trustee, as such form is supplemented and/or modified and/or superseded by the provisions of this permanent Global Instrument (including the supplemental definitions and any modifications or additions set out in the Third Schedule to this permanent Global Instrument), which in the event of any conflict shall prevail). Other capitalised terms used in this permanent Global Instrument shall have the meanings given to them in the Conditions or the Trust Deed. | ||
2 | Aggregate Nominal Amount | |
The aggregate nominal amount from time to time of this permanent Global Instrument shall be an amount equal to the aggregate nominal amount of the Instruments as shall be shown by the latest entry in the fourth column of the First Schedule to this permanent Global Instrument, which shall be completed by or on behalf of the Issuing and Paying Agent upon (a) the exchange of the whole or a part of the temporary Global Instrument initially representing the Instruments for a corresponding interest in this permanent Global Instrument (in the case of Instruments represented by a temporary Global Instrument upon issue), (b) the issue of the Instruments represented by this permanent Global Instrument (in the case of Instruments represented by this permanent Global Instrument upon issue), (c) the exchange of the whole or, where the limited circumstances so permit, a part of this permanent Global Instrument for Definitive Instruments, (d) the redemption or purchase and cancellation of Instruments represented by this permanent Global Instrument and/or (e) in the case of Partly Paid Instruments, the forfeiture of Instruments represented by this |
* | Delete as applicable. |
32
permanent Global Instrument in accordance with the Conditions relating to such Partly Paid Instruments, all as described below. | ||
3 | Promise to Pay | |
Subject as provided in this permanent Global Instrument, the Issuer, for value received, by this permanent Global Instrument promises to pay to the bearer of this permanent Global Instrument, upon presentation and (when no further payment is due in respect of this permanent Global Instrument) surrender of this permanent Global Instrument, on the Maturity Date (or on such earlier date or, if the Maturity Date is specified to be perpetual on such date as the amount payable upon redemption under the Conditions may become repayable in accordance with the Conditions), the amount payable upon redemption under the Conditions in respect of the aggregate nominal amount of Instruments represented by this permanent Global Instrument and (unless this permanent Global Instrument does not bear interest) to pay interest in respect of the Instruments from the Interest Commencement Date in arrear at the rates, on the dates for payment, and in accordance with the methods of calculation provided for in the Conditions, save that the calculation is made in respect of the total aggregate amount of the Instruments, together with such other sums and additional amounts (if any) as may be payable under the Conditions, in accordance with the Conditions. | ||
4 | Exchange | |
This permanent Global Instrument is exchangeable (free of charge to the holder) on or after the Exchange Date in whole but not, except as provided in the next paragraph, in part for the Definitive Instruments if this permanent Global Instrument is held on behalf of Euroclear or Clearstream, Luxembourg or any other clearing system (an Alternative Clearing System ) and any such clearing system is closed for business for a continuous period of 14 days (other than by reason of holidays, statutory or otherwise) or announces an intention permanently to cease business or does in fact do so. | ||
This permanent Global Instrument is exchangeable in part (provided, however, that if this permanent Global Instrument is held by or on behalf of Euroclear and/or Clearstream, Luxembourg and/or any Alternative Clearing System, the rules of Euroclear and/or Clearstream, Luxembourg and/or such Alternative Clearing System as the case may be, so permit) if so provided, and in accordance with, the Conditions relating to Partly Paid Instruments. | ||
Exchange Date means a day falling not less than 60 days, or in the case of failure to pay principal when due 30 days, after that on which the notice requiring exchange is given and on which banks are open for business in the city in which the specified office of the Issuing and Paying Agent is located and, except in the case of exchange pursuant to the first paragraph of this section above, in the cities in which Euroclear and Clearstream, Luxembourg or, if relevant, the Alternative Clearing System, are located. | ||
Subject as provided in the Conditions applicable to Partly Paid Instruments, any such exchange may be effected on or after an Exchange Date by the holder of this permanent Global Instrument surrendering this permanent Global Instrument or, in the case of a partial exchange, presenting it for endorsement to or to the order of the Issuing and Paying Agent. In exchange for this permanent Global Instrument, or part of this permanent Global Instrument to be exchanged, the Issuer shall deliver, or procure the delivery of, duly executed and authenticated Definitive Instruments in an aggregate nominal amount equal |
33
to the nominal amount of this permanent Global Instrument submitted for exchange (if appropriate, having attached to them all Coupons (and, where appropriate, Talons) in respect of interest, and all Receipts in respect of Instalment Amounts, which have not already been paid on this permanent Global Instrument), security printed and substantially in the form set out in Schedule 2 to the Trust Deed as supplemented and/or modified and/or superseded by the terms of the Third Schedule to this permanent Global Instrument. | ||
On any exchange of a part of this permanent Global Instrument the portion of the nominal amount of this permanent Global Instrument so exchanged shall be endorsed by or on behalf of the Issuing and Paying Agent in the First Schedule to this permanent Global Instrument, whereupon the nominal amount of this permanent Global Instrument shall be reduced for all purposes by the amount so exchanged and endorsed. | ||
5 | Benefit of Conditions | |
Except as otherwise specified in this permanent Global Instrument, this permanent Global Instrument is subject to the Conditions and the Trust Deed and, until the whole of this permanent Global Instrument is exchanged for Definitive Instruments, the holder of this permanent Global Instrument shall in all respects be entitled to the same benefits as if it were the holder of the Definitive Instruments for which it may be exchanged and as if such Definitive Instruments had been issued on the Issue Date. | ||
6 | Payments | |
No person shall be entitled to receive any payment in respect of the Instruments represented by this permanent Global Instrument that falls due after an Exchange Date for such Instruments, unless upon due presentation of this permanent Global Instrument for exchange, delivery of Definitive Instruments is improperly withheld or refused by or on behalf of the Issuer or the Issuer does not perform or comply with any one or more of what are expressed to be its obligations under any Definitive Instruments. | ||
Payments in respect of this permanent Global Instrument shall be made to its holder against presentation and (if no further payment falls to be made on it) surrender of it at the specified office of the Issuing and Paying Agent or of any other Paying Agent provided for in the Conditions. A record of each such payment shall be endorsed on the First or Second Schedule to this permanent Global Instrument, as appropriate, by the Issuing and Paying Agent or by the relevant Paying Agent, for and on behalf of the Issuing and Paying Agent, which endorsement shall (until the contrary is proved) be prima facie evidence that the payment in question has been made. Condition 6.4(e) and Condition 7(e)(i) will apply to the Definitive Instruments only. | ||
For the purposes of any payments made in respect of this permanent Global Instrument, the words in the relevant place of presentation shall not apply in the definition of business day in Condition 6.6 (Non-Business Days). | ||
7 | Prescription | |
Claims in respect of principal and interest (as each such term is defined in the Conditions) in respect of this permanent Global Instrument shall become void unless it is presented for payment within a period of 10 years (in the case of principal) and five years (in the case of interest) from the appropriate Relevant Date. |
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8 | Meetings | |
For the purposes of any meeting of Instrumentholders, the holder of this permanent Global Instrument shall (unless this permanent Global Instrument represents only one Instrument) be treated as two persons for the purposes of any quorum requirements of a meeting of Instrumentholders and, at any such meeting, as having one vote in respect of each integral currency unit of the Specified Currency of the Instruments. | ||
9 | Cancellation | |
Cancellation of any Instrument represented by this permanent Global Instrument which is required by the Conditions to be cancelled (other than upon its redemption) shall be effected by reduction in the nominal amount of this permanent Global Instrument representing such Instrument on its presentation to or to the order of the Issuing and Paying Agent for endorsement in the First Schedule to this permanent Global Instrument, upon which the nominal amount of this permanent Global Instrument shall be reduced for all purposes by the amount so cancelled and endorsed. | ||
10 | Purchase | |
Instruments may only be purchased by the Issuer, or any of its subsidiary undertakings if they are purchased together with the right to receive all future payments of interest and Instalment Amounts (if any) on the Instruments being purchased. | ||
11 | Issuers Options | |
Any option of the Issuer provided for in the Conditions shall be exercised by the Issuer giving notice to the Instrumentholders within the time limits set out in and containing the information required by the Conditions, except that the notice shall not be required to contain the serial numbers of Instruments drawn in the case of a partial exercise of an option and accordingly no drawing of Instruments shall be required. | ||
12 | Instrumentholders Redemption Option [and Restructuring Redemption Option] * | |
Any option of the Instrumentholders provided for in the Conditions may be exercised by the holder of this permanent Global Instrument giving notice to the Issuing and Paying Agent within the time limits relating to the deposit of Instruments with a Paying Agent set out in the Conditions substantially in the form of the relevant notice available from any Paying Agent and stating the nominal amount of Instruments in respect of which the option is exercised and at the same time presenting this permanent Global Instrument to the Issuing and Paying Agent, or to a Paying Agent acting on behalf of the Issuing and Paying Agent, for notation accordingly in the Fourth Schedule to this permanent Global Instrument. | ||
13 | Notices | |
Notices required to be given in respect of the Instruments represented by this permanent Global Instrument may be given by their being delivered (so long as this permanent Global Instrument is held on behalf of Euroclear, Clearstream, Luxembourg or any Alternative Clearing System) to Euroclear, Clearstream, Luxembourg or such Alternative Clearing |
* | If applicable. |
35
System, as the case may be, or otherwise to the holder of this permanent Global Instrument, rather than by publication as required by the Conditions. | ||
14 | Negotiability | |
This permanent Global Instrument is a bearer document and negotiable and accordingly: |
(a) | is freely transferable by delivery and such transfer shall operate to confer upon the transferee all rights and benefits appertaining to this permanent Global Instrument and to bind the transferee with all obligations appertaining to this permanent Global Instrument pursuant to the Conditions; | ||
(b) | the holder of this permanent Global Instrument is and shall be absolutely entitled as against all previous holders to receive all amounts by way of amounts payable upon redemption, interest or otherwise payable in respect of this permanent Global Instrument and the Issuer has waived against such holder and any previous holder of this permanent Global Instrument all rights of set-off or counterclaim which would or might otherwise be available to it in respect of the obligations evidenced by this permanent Global Instrument; and | ||
(c) | payment upon due presentation of this permanent Global Instrument as provided in this permanent Global Instrument shall operate as a good discharge against such holder and all previous holders of this permanent Global Instrument. |
No provisions of this permanent Global Instrument shall alter or impair the obligation of the Issuer to pay the principal and premium of and interest on the Instruments when due in accordance with the Conditions. | ||
This permanent Global Instrument shall not be valid or become obligatory for any purpose until authenticated by or on behalf of the Issuing and Paying Agent. | ||
This permanent Global Instrument and all matters arising from or connected with it shall be governed by, and construed in accordance with, English law. |
* | Delete as applicable. |
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Reason for | ||||||||
increase/decrease | ||||||||
in nominal amount | ||||||||
of this permanent | ||||||||
Global Instrument | ||||||||
(initial issue, | ||||||||
Amount of | exchange, | Nominal amount | ||||||
increase/decrease | cancellation, | of this permanent | Notation made | |||||
in nominal | forfeiture or | Global Instrument | by or on behalf | |||||
amount of this | payment, stating | on issue or | of the Issuing | |||||
permanent Global | amount of payment | following such | and Paying | |||||
Date | Instrument | made) | increase/decrease | Agent | ||||
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Notation made by or on | ||||||
behalf of the Issuing and | ||||||
Due date of payment | Date of payment | Amount of interest | Paying Agent | |||
|
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Nominal amount of | ||||||
this permanent | Notation made by or | |||||
Global Instrument in | Date on which | on behalf of the | ||||
respect of which | exercise of such | Issuing and Paying | ||||
Date of exercise | exercise is made | option is effective | Agent | |||
|
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|
* | If applicable. |
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* | Delete as applicable. |
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44
45
| Delete as applicable. |
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47
* | Delete as applicable. |
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49
50
12 | Instrumentholders Options Option [and Restructuring Redemption Option] |
| If applicable. |
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(a) | is freely transferable by delivery and such transfer shall operate to confer upon the transferee all rights and benefits appertaining to this permanent Global Instrument and to bind the transferee with all obligations appertaining to this permanent Global Instrument pursuant to the Conditions; | |
(b) | the holder of this permanent Global Instrument is and shall be absolutely entitled as against all previous holders to receive all amounts by way of amounts payable upon redemption, interest or otherwise payable in respect of this permanent Global Instrument and the Issuer has waived against such holder and any previous holder of this permanent Global Instrument all rights of set-off or counterclaim which would or might otherwise be available to it in respect of the obligations evidenced by this permanent Global Instrument; and | |
(c) | payment upon due presentation of this permanent Global Instrument as provided in this permanent Global Instrument shall operate as a good discharge against such holder and all previous holders of this permanent Global Instrument. |
52
* | Delete as applicable. |
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54
[Denomination] | [ISIN] | [Series] | [Certif. No.] |
* | Delete as applicable. |
55
56
57
References in these terms and conditions to Instruments (as defined below) are to the Instruments of one Series only of the relevant Issuer (as defined below), not to all Instruments that may be issued under the Programme. | ||
National Grid plc ( National Grid ) and National Grid Electricity Transmission plc ( NGET ) (each an Issuer and together, the Issuers ) have established a Euro Medium Term Note Programme (the Programme ) for the issuance of up to Euro 15,000,000,000 in aggregate principal amount of debt instruments (the Instruments ). The Instruments are constituted by a Trust Deed (as amended or supplemented from time to time, the Trust Deed ) dated 26 July 2010 between the Issuers and The Law Debenture Trust Corporation p.l.c. (the Trustee , which expression shall include all persons for the time being the trustee or trustees under the Trust Deed) as trustee for the Instrumentholders (as defined below). These terms and conditions include summaries of, and are subject to, the detailed provisions of the Trust Deed, which includes the form of the Definitive Instruments, Receipts, Coupons and Talons referred to below. An Agency Agreement (as amended or supplemented from time to time, the Agency Agreement ) dated 26 July 2010 has been entered into in relation to the Instruments between the Issuers, the Trustee, The Bank of New York Mellon as initial issuing and paying agent and the other agent(s) named in it. The issuing and paying agent, the paying agent(s) and the calculation agent(s) for the time being (if any) are referred to below respectively as the Issuing and Paying Agent , the Paying Agents (which expression shall include the Issuing and Paying Agent) and the Calculation Agent(s) . Copies of the Trust Deed and the Agency Agreement are available for inspection during usual business hours at the registered office of the Trustee (as at 26 July 2010 at Fifth Floor, 100 Wood Street, London EC2V 7EX) and at the specified offices of the Paying Agents. | ||
The Instrumentholders, the holders of the interest coupons (the Coupons ) appertaining to interest bearing Instruments and, where applicable in the case of such Instruments, talons for further Coupons (the Talons ) (the Couponholders ) and the holders of the receipts for the payment of instalments of principal (the Receipts ) relating to Instruments of which the principal is payable in instalments are entitled to the benefit of, are bound by, and are deemed to have notice of, all the provisions of the Trust Deed and are deemed to have notice of those provisions of the Agency Agreement applicable to them. | ||
1 | Form, Denomination and Title | |
The Instruments are issued in bearer form in the Specified Denomination(s) specified in the relevant Final Terms and are serially numbered. Instruments of one Specified Denomination are not exchangeable for Instruments of another Specified Denomination provided that in the case of any |
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Instruments which are to be admitted to trading on a regulated market within the European Economic Area or offered to the public in a Member State of the European Economic Area in circumstances which require the publication of a prospectus under the Prospectus Directive, the minimum Specified Denomination shall be 50,000 (or its equivalent in any other currency as at the date of issue of the relevant Instruments). | ||
This Instrument is a Fixed Rate Instrument, a Floating Rate Instrument, a Zero Coupon Instrument, a Perpetual Instrument, an Index Linked Interest Instrument, an Index Linked Redemption Instrument, an Instalment Instrument, a Dual Currency Instrument or a Partly Paid Instrument, a combination of any of the preceding or any other kind of Instrument, depending upon the Interest and Redemption/Payment Basis specified in the relevant Final Terms. | ||
Instruments are issued with Coupons (and, where appropriate, a Talon) attached, save in the case of Zero Coupon Instruments in which case references to interest (other than in relation to interest due after the Maturity Date), Coupons and Talons in these Conditions are not applicable. | ||
Instalment Instruments are issued with one or more Receipts attached. Title to the Instruments and the Receipts, Coupons and Talons shall pass by delivery and except as ordered by a court of competent jurisdiction or as required by law, the Issuer and the Paying Agents shall be entitled to treat the bearer of any Instrument, Receipt, Coupon or Talon as the absolute owner of that Instrument, Receipt, Coupon or Talon, as the case may be, and shall not be required to obtain any proof of ownership as to the identity of the bearer. | ||
In these Conditions, Instrumentholder means the bearer of any Instrument of one Series only of an Issuer and the Receipts relating to it, holder (in relation to an Instrument, Receipt, Coupon or Talon) means the bearer of any Instrument, Receipt, Coupon or Talon and capitalised terms have the meanings given to them herein, the absence of any such meaning indicating that such term is not applicable to the Instruments. | ||
2 | Status and Negative Pledge |
2.1 | Status | ||
The Instruments and the Receipts and Coupons relating to them constitute direct, unconditional and unsecured obligations of the Issuer and rank pari passu without any preference or priority among themselves. The payment obligations of the Issuer under the Instruments, Receipts and Coupons shall, subject to such exceptions as are from time to time applicable under the laws of England and, in relation to Instruments issued by National Grid, as provided in Condition 2.2, rank equally with all other present and future unsecured obligations (other than subordinated obligations, if any) of the Issuer. | |||
2.2 | Negative Pledge | ||
So long as any Instrument, Receipt or Coupon of National Grid remains outstanding (as defined in the Trust Deed) National Grid will not create or permit to subsist any mortgage, charge, pledge, lien or other form of encumbrance or security interest ( Security ) upon the whole or any part of its undertaking, assets or revenues present or future to secure any Relevant Indebtedness, or any guarantee of or indemnity in respect of any Relevant Indebtedness unless, at the same time or prior thereto, National Grids obligations under the Instruments, the Receipts, the Coupons and the Trust Deed (a) are secured equally and rateably therewith or benefit from a guarantee or indemnity in substantially identical terms thereto, as the case may be, in each case to the satisfaction of the Trustee, or (b) have the |
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benefit of such other security, guarantee, indemnity or other arrangement as the Trustee in its absolute discretion shall deem to be not materially less beneficial to the Instrumentholders or as shall be approved by an Extraordinary Resolution (as defined in the Trust Deed) of the Instrumentholders. | |||
For the purposes of these Conditions, Relevant Indebtedness means any present or future indebtedness in the form of, or represented by, bonds, notes, debentures, loan stock or other securities which are for the time being, or are intended, with the agreement of the Issuer, to be quoted, listed or ordinarily dealt in on any stock exchange. |
3 | Interest |
3.1 | Interest on Fixed Rate Instruments | ||
Each Fixed Rate Instrument bears interest on its outstanding nominal amount from the Interest Commencement Date at the rate per annum (expressed as a percentage) equal to the Rate of Interest, payable in arrear on each Interest Payment Date. The amount of Interest payable shall be determined in accordance with Condition 3.2.4(f). | |||
If a Fixed Coupon Amount or a Broken Amount is specified in the relevant Final Terms, the amount of interest payable on each Interest Payment Date will amount to the Fixed Coupon Amount, or, if applicable, the Broken Amount so specified and in the case of a Broken Amount will be payable on the particular Interest Payment Date(s) specified in the relevant Final Terms. |
3.2 | Interest on Floating Rate Instruments and Index Linked Interest Instruments |
3.2.1 | Interest Payment Dates | ||
Each Floating Rate Instrument and Index Linked Interest Instrument bears interest on its outstanding nominal amount from the Interest Commencement Date at the rate per annum (expressed as a percentage) equal to the Rate of Interest, such interest being payable in arrear on each Interest Payment Date. The amount of Interest payable shall be determined in accordance with Condition 3.2.4(f). Such Interest Payment Date(s) is/are either specified in the relevant Final Terms as Specified Interest Payment Dates or, if no Specified Interest Payment Date(s) is/are specified in the relevant Final Terms, Interest Payment Date shall mean each date which falls the number of months or other period shown on this Instrument as the Interest Period after the preceding Interest Payment Date or, in the case of the first Interest Payment Date, after the Interest Commencement Date. | |||
3.2.2 | Business Day Convention | ||
If any date which is specified to be subject to adjustment in accordance with a Business Day Convention would otherwise fall on a day which is not a Business Day, then, if the Business Day Convention specified is (a) the Floating Rate Convention, such date shall be postponed to the next day which is a Business Day unless it would then fall into the next calendar month, in which event (x) such date shall be brought forward to the immediately preceding Business Day and (y) each subsequent such date shall be the last Business Day of the month in which such date would have fallen had it not been subject to adjustment, (b) the Following Business Day Convention, such date shall be postponed to the next day which is a Business Day, (c) the Modified Following Business Day Convention, such date shall be postponed to the next day |
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which is a Business Day unless it would then fall into the next calendar month, in that event such date shall be brought forward to the immediately preceding Business Day or (d) the Preceding Business Day Convention, such date shall be brought forward to the immediately preceding Business Day. | |||
3.2.3 | Rate of Interest for Floating Rate Instruments | ||
The Rate of Interest in respect of Floating Rate Instruments for each Interest Accrual Period shall be determined in the manner specified in the relevant Final Terms and the provisions below relating to either ISDA Determination or Screen Rate Determination shall apply, depending upon which is specified on this Instrument. |
(a) | ISDA Determination for Floating Rate Instruments: Where ISDA Determination is specified in the relevant Final Terms as the manner in which the Rate of Interest is to be determined, the Rate of Interest for each Interest Accrual Period shall be determined by the Calculation Agent as a rate equal to the relevant ISDA Rate. For the purposes of this sub-paragraph (a), ISDA Rate for an Interest Accrual Period means a rate equal to the Floating Rate which would be determined by the Calculation Agent under a Swap Transaction under the terms of an agreement incorporating the ISDA Definitions and under which: |
(i) | the Floating Rate Option is as specified in the relevant Final Terms; | ||
(ii) | the Designated Maturity is a period specified in the relevant Final Terms; and | ||
(iii) | the relevant Reset Date is the first day of that Interest Accrual Period unless otherwise specified in the relevant Final Terms. |
For the purposes of this sub-paragraph (a), Floating Rate , Calculation Agent , Floating Rate Option , Designated Maturity , Reset Date and Swap Transaction have the meanings given to those terms in the ISDA Definitions. | |||
(b) | Screen Rate Determination for Floating Rate Instruments: |
(i) | Where Screen Rate Determination is specified in the relevant Final Terms as the manner in which the Rate of Interest is to be determined, the Rate of Interest for each Interest Accrual Period will, subject as provided below, be either: |
(x) | the offered quotation; or | ||
(y) | the arithmetic mean of the offered quotations, |
(expressed as a percentage rate per annum) for the Reference Rate which appears or appear, as the case may be, on the Relevant Screen Page as at either 11.00 a.m. (London time in the case of LIBOR or Brussels time in the case of EURIBOR) on the Interest Determination Date in question as determined by the Calculation Agent. If five or more of such offered quotations are available on the Relevant Screen Page, the highest (or, if there is more than one such highest quotation, one only of such quotations) and the lowest (or, if there is more than one such lowest quotation, one only of such quotations) shall be disregarded by the |
61
Calculation Agent for the purpose of determining the arithmetic mean of such offered quotations. | |||
If the Reference Rate from time to time in respect of Floating Rate Instruments is specified hereon as being other than LIBOR or EURIBOR, the Rate of Interest in respect of such Instruments will be determined as provided hereon. | |||
(ii) | if the Relevant Screen Page is not available or if, sub-paragraph (i)(x) applies and no such offered quotation appears on the Relevant Screen Page or if sub-paragraph (i)(y) above applies and fewer than three such offered quotations appear on the Relevant Screen Page in each case as at the time specified above, subject as provided below, the Calculation Agent shall request, if the Reference Rate is LIBOR, the principal London office of each of the Reference Banks or, if the Reference Rate is EURIBOR, the principal Euro-zone office of each of the Reference Banks, to provide the Calculation Agent with its offered quotation (expressed as a percentage rate per annum) for the Reference Rate if the Reference Rate is LIBOR, at approximately 11.00 a.m. (London time), or if the Reference Rate is EURIBOR, at approximately 11.00 a.m. (Brussels time) on the Interest Determination Date in question. If two or more of the Reference Banks provide the Calculation Agent with such offered quotations, the Rate of Interest for such Interest Period shall be the arithmetic mean of such offered quotations as determined by the Calculation Agent; and | ||
(iii) | if paragraph (ii) above applies and the Calculation Agent determines that fewer than two Reference Banks are providing offered quotations, subject as provided below, the Rate of Interest shall be the arithmetic mean of the rates per annum (expressed as a percentage) as communicated to (and at the request of) the Calculation Agent by the Reference Banks or any two or more of them, at which such banks were offered, if the Reference Rate is LIBOR, at approximately 11.00 a.m. (London time) or, if the Reference Rate is EURIBOR, at approximately 11.00 a.m. (Brussels time) on the relevant Interest Determination Date, deposits in the Specified Currency for a period equal to that which would have been used for the Reference Rate by leading banks in, if the Reference Rate is LIBOR, the London inter-bank market or, if the Reference Rate is EURIBOR, the Euro-zone inter-bank market, as the case may be, or, if fewer than two of the Reference Banks provide the Calculation Agent with such offered rates, the offered rate for deposits in the Specified Currency for a period equal to that which would have been used for the Reference Rate, or the arithmetic mean of the offered rates for deposits in the Specified Currency for a period equal to that which would have been used for the Reference Rate, at which, if the Reference Rate is LIBOR, at approximately 11.00 a.m. (London time) or, if the Reference Rate is EURIBOR, at approximately 11.00 a.m. (Brussels time), on the relevant Interest Determination Date, any one or more banks (which bank or banks is or are in the opinion of the Trustee and the Issuer suitable for such purpose) informs the Calculation Agent it is quoting to leading banks in, if the Reference Rate is LIBOR, the London inter-bank market or, if the |
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Reference Rate is EURIBOR, the Euro-zone inter-bank market, as the case may be, provided that, if the Rate of Interest cannot be determined in accordance with the foregoing provisions of this paragraph, the Rate of Interest shall be determined as at the last preceding Interest Determination Date (though substituting, where a different Margin or Maximum or Minimum Rate of Interest is to be applied to the relevant Interest Accrual Period from that which applied to the last preceding Interest Accrual Period, the Margin or Maximum or Minimum Rate of Interest relating to the relevant Interest Accrual Period, in place of the Margin or Maximum or Minimum Rate of Interest relating to that last preceding Interest Accrual Period). |
3.2.4 | Rate of Interest for Index Linked Interest Instruments | ||
The Rate of Interest in respect of Index Linked Interest Instruments for each Interest Accrual Period shall be determined in the manner specified in the relevant Final Terms and interest will accrue by reference to an Index or Formula as specified in the relevant Final Terms. |
(a) | Zero Coupon Instruments | ||
Where an Instrument, the Interest Basis of which is specified to be Zero Coupon, is repayable prior to the Maturity Date and is not paid when due, the amount due and payable prior to the Maturity Date shall be the Early Redemption Amount of such Instrument. As from the Maturity Date, the Rate of Interest for any overdue principal of such an Instrument shall be a rate per annum (expressed as a percentage) equal to the Amortisation Yield (as defined in Condition 5.4.1(b)). | |||
(b) | Dual Currency Instruments | ||
In the case of Dual Currency Instruments, if the rate or amount of interest falls to be determined by reference to a Rate of Exchange or a method of calculating a Rate of Exchange, the rate or amount of interest payable shall be determined in the manner specified in the relevant Final Terms. | |||
(c) | Partly Paid Instruments | ||
In the case of Partly Paid Instruments (other than Partly Paid Instruments which are Zero Coupon Instruments), interest will accrue as previously stated on the paid-up nominal amount of such Instruments and otherwise as specified in the relevant Final Terms. | |||
(d) | Accrual of Interest | ||
Interest shall cease to accrue on each Instrument on the due date for redemption unless, upon due presentation, payment is improperly withheld or refused, in which event interest shall continue to accrue (as well after as before judgment) at the Rate of Interest in the manner provided in this Condition 3 to the Relevant Date (as defined in Condition 7). |
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(e) | Margin, Maximum/Minimum Rates of Interest, Instalment Amounts and Redemption Amounts and Rounding |
(i) | If any Margin is specified in the relevant Final Terms (either (x) generally, or (y) in relation to one or more Interest Accrual Periods), an adjustment shall be made to all Rates of Interest, in the case of (x), or the Rates of Interest for the specified Interest Accrual Periods, in the case of (y), calculated in accordance with Condition 3.2.3(b) above, by adding (if a positive number) or subtracting (if a negative number) the absolute value of such Margin, subject always to the next paragraph. | ||
(ii) | If any Maximum or Minimum Rate of Interest, Instalment Amount or Redemption Amount is specified in the relevant Final Terms, then any Rate of Interest, Instalment Amount or Redemption Amount shall be subject to such maximum or minimum, as the case may be. | ||
(iii) | For the purposes of any calculations required pursuant to these Conditions (unless otherwise specified), (x) all percentages resulting from such calculations shall be rounded, if necessary, to the nearest one hundred thousandth of a percentage point (with halves being rounded up), (y) all figures shall be rounded to seven significant figures (with halves being rounded up) and (z) all currency amounts that fall due and payable shall be rounded to the nearest unit of such currency (with halves being rounded up), save in the case of yen, which shall be rounded down to the nearest yen. For these purposes unit means the lowest amount of such currency which is available as legal tender in the country of such currency. |
(f) | Calculations | ||
The amount of interest payable per Calculation Amount in respect of any Instrument for any Interest Accrual Period shall be equal to the product of the Rate of Interest, the Calculation Amount as specified in the relevant Final Terms, and the Day Count Fraction for such Interest Accrual Period, unless an Interest Amount (or a formula for its calculation) is applicable to such Interest Accrual Period, in which case the amount of interest payable per Calculation Amount in respect of such Instrument for such Interest Accrual Period shall equal such Interest Amount (or be calculated in accordance with such formula). Where any Interest Period comprises two or more Interest Accrual Periods, the amount of interest payable per Calculation Amount in respect of such Interest Period shall be the sum of the Interest Amounts payable in respect of each of those Interest Accrual Periods. In respect of any other period for which interest is required to be calculated, the provisions above shall apply save that the Day Count Fraction shall be for the period for which interest is required to be calculated. | |||
(g) | Determination and Publication of Rates of Interest, Interest Amounts, Final Redemption Amounts, Early Redemption Amounts, Optional Redemption Amounts and Instalment Amounts | ||
The Calculation Agent shall as soon as practicable on each Interest Determination Date or such other time on such date as the Calculation Agent may be required to calculate any rate or amount, obtain any quotation or make |
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any determination or calculation, determine such rate and calculate the Interest Amounts for the relevant Interest Accrual Period, calculate the Redemption Amount or Instalment Amount, obtain such quote or make such determination or calculation, as the case may be, and cause the Rate of Interest and the Interest Amounts for each Interest Accrual Period and the relevant Interest Payment Date and, if required to be calculated, the Final Redemption Amount, Early Redemption Amount, Optional Redemption Amount or any Instalment Amount to be notified to the Trustee, the Issuer, each of the Paying Agents, the Instrumentholders, any other Calculation Agent appointed in respect of the Instruments that is to make a further calculation upon receipt of such information and, if the Instruments are listed on a stock exchange and the rules of such exchange so require, such exchange as soon as possible after their determination but in no event later than (i) the commencement of the relevant Interest Period, if determined prior to such time, in the case of notification to such exchange of a Rate of Interest and Interest Amount, or (ii) in all other cases, the fourth Business Day after such determination. Where any Interest Payment Date or Interest Period Date is subject to adjustment pursuant to Condition 3.2.3(b)(ii), the Interest Amounts and the Interest Payment Date so published may subsequently be amended (or appropriate alternative arrangements made with the consent of the Trustee by way of adjustment) without notice in the event of an extension or shortening of the Interest Period. If the Instruments become due and payable under Condition 9, the accrued interest and the Rate of Interest payable in respect of the Instruments shall nevertheless continue to be calculated as previously in accordance with this Condition but no publication of the Rate of Interest or the Interest Amount so calculated need be made unless the Trustee otherwise requires. The determination of any rate or amount, the obtaining of each quotation and the making of each determination or calculation by the Calculation Agent(s) shall (in the absence of manifest error) be final and binding upon all parties. | |||
(h) | Determination or Calculation by Trustee | ||
If the Calculation Agent does not at any time for any reason determine or calculate the Rate of Interest for an Interest Accrual Period or any Interest Amount, Instalment Amount, Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount the Trustee shall do so (or shall appoint an agent on its behalf to do so) and such determination or calculation shall be deemed to have been made by the Calculation Agent. In doing so, the Trustee shall apply the preceding provisions of this Condition, with any necessary consequential amendments, to the extent that, in its opinion, it can do so, and, in all other respects it shall do so in such manner as it shall deem fair and reasonable in all the circumstances. |
3.2.5 | Definitions | ||
In these Conditions, unless the context otherwise requires, the following defined terms shall have the meanings set out below: | |||
Business Day means: |
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(a) | in the case of a currency other than Euro, a day (other than a Saturday or Sunday) on which commercial banks and foreign exchange markets settle payments in the principal financial centre for such currency; and/or | ||
(b) | in the case of Euro, a day on which the TARGET System is operating (a TARGET Business Day ); and/or | ||
(c) | in the case of a currency and/or one or more Business Centres as specified in the relevant Final Terms, a day (other than a Saturday or a Sunday) on which commercial banks and foreign exchange markets settle payments in such currency or, if no currency is indicated, generally in each of the Business Centres. |
Day Count Fraction means, in respect of the calculation of an amount of interest on any Instrument for any period of time (from and including the first day of such period to but excluding the last) (whether or not constituting an Interest Period or Interest Accrual Period, the Calculation Period ): |
(a) | if Actual/Actual or Actual/Actual-ISDA is specified in the relevant Final Terms, the actual number of days in the Calculation Period divided by 365 (or, if any portion of that Calculation Period falls in a leap year, the sum of (i) the actual number of days in that portion of the Calculation Period falling in a leap year divided by 366 and (ii) the actual number of days in that portion of the Calculation Period falling in a non-leap year divided by 365); | ||
(b) | if Actual/365 (Fixed) is specified in the relevant Final Terms, the actual number of days in the Calculation Period divided by 365; | ||
(c) | if Actual/360 is specified in the relevant Final Terms, the actual number of days in the Calculation Period divided by 360; | ||
(d) | if 30/360 , 360/360 or Bond Basis is specified in the relevant Final Terms, the number of days in the Calculation Period divided by 360 calculated on a formula basis as follows: |
Day Count Fraction = | [360 x (Y 2 -Y 1 )] + [30 x (M 2 -M 1 )]+ (D 2 -D 1 ) | |
360 |
where: | |||
Y 1 is the year, expressed as a number, in which the first day of the Calculation Period falls; | |||
Y 2 is the year, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
M 1 is the calendar month, expressed as a number, in which the first day of the Calculation Period falls; | |||
M 2 is the calendar month, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
D 1 is the first calendar day, expressed as a number, of the Calculation Period, unless such number would be 31, in which case D 1 will be 30; and |
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D 2 is the calendar day, expressed as a number, immediately following the last day included in the Calculation Period, unless such number would be 31 and D 1 is greater than 29, in which case D 2 will be 30; | |||
(e) | if 30E/360 or Eurobond Basis is specified in the relevant Final Terms, the number of days in the Calculation Period divided by 360 calculated on a formula basis as follows: |
Day Count Fraction = | [360 x (Y 2 -Y 1 )] + [30 x (M 2 -M 1 )]+ (D 2 -D 1 ) | |
360 |
where: | |||
Y 1 is the year, expressed as a number, in which the first day of the Calculation Period falls; | |||
Y 2 is the year, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
M 1 is the calendar month, expressed as a number, in which the first day of the Calculation Period falls; | |||
M 2 is the calendar month, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
D 1 is the first calendar day, expressed as a number, of the Calculation Period, unless such number would be 31, in which case D 1 will be 30; and | |||
D 2 is the calendar day, expressed as a number, immediately following the last day included in the Calculation Period, unless such number would be 31, in which case D 2 will be 30; | |||
(f) | if 30E/360 (ISDA) is specified in the relevant Final Terms, the number of days in the Calculation Period divided by 360, calculated on a formula basis as follows: |
Day Count Fraction = | [360 x (Y 2 -Y 1 )] + [30 x (M 2 -M 1 )]+ (D 2 -D 1 ) | |
360 |
where: | |||
Y 1 is the year, expressed as a number, in which the first day of the Calculation Period falls; | |||
Y 2 is the year, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
M 1 is the calendar month, expressed as a number, in which the first day of the Calculation Period falls; | |||
M 2 is the calendar month, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; |
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D 1 is the first calendar day, expressed as a number, of the Calculation Period, unless (i) that day is the last day of February or (ii) such number would be 31, in which case D 1 will be 30; and | |||
D 2 is the calendar day, expressed as a number, immediately following the last day included in the Calculation Period, unless (i) that day is the last day of February but not the Maturity Date or (ii) such number would be 31, in which case D 2 will be 30; and | |||
(g) | if Actual/Actual-ICMA is specified in the relevant Final Terms: |
(i) | if the Calculation Period is equal to or shorter than the Determination Period during which it falls, the actual number of days in the Calculation Period divided by the product of (x) the actual number of days in such Determination Period and (y) the number of Determination Periods in any year; and | ||
(ii) | if the Calculation Period is longer than one Determination Period, the sum of: |
(1) | the actual number of days in such Calculation Period falling in the Determination Period in which it begins divided by the product of (a) the actual number of days in such Determination Period and (b) the number of Determination Periods in any year; and | ||
(2) | the actual number of days in such Calculation Period falling in the next Determination Period divided by the product of (a) the actual number of days in such Determination Period and (b) the number of Determination Periods in any year, | ||
where: | |||
Determination Period means the period from and including a Determination Date in any year to but excluding the next Determination Date; and | |||
Determination Date means the date specified as such in the relevant Final Terms or, if none is so specified, the Interest Payment Date. |
Euro-zone means the region comprising of member states of the European Union that adopt the single currency in accordance with the Treaty establishing the European Community as amended. | |||
Interest Accrual Period means the period beginning on (and including) the Interest Commencement Date and ending on (but excluding) the first Interest Period Date and each successive period beginning on (and including) an Interest Period Date and ending on (but excluding) the next succeeding Interest Period Date. | |||
Interest Amount means: |
(i) | in respect of an Interest Accrual Period, the amount of interest payable per Calculation Amount for that Interest Accrual Period and which, in the case of Fixed Rate Instruments, and unless otherwise specified in the relevant Final Terms, shall mean the Fixed Coupon Amount or Broken Amount specified in the |
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relevant Final Terms as being payable on the Interest Payment Date ending the Interest Period of which such Interest Accrual Period forms part; and | |||
(ii) | in respect of any other period, the amount of interest payable per Calculation Amount for that period. |
Interest Commencement Date means the Issue Date or such other date as may be specified in the relevant Final Terms. | |||
Interest Determination Date means, with respect to a Rate of Interest and Interest Accrual Period, the date specified as such in the relevant Final Terms or, if none is so specified, (a) the first day of such Interest Accrual Period if the Specified Currency is Sterling or (b) the day falling two Business Days in London prior to the first day of such Interest Accrual Period if the Specified Currency is neither Sterling nor Euro or (c) the day falling two TARGET Business Days prior to the first day of such Interest Accrual Period if the Specified Currency is Euro. | |||
Interest Payment Date means the date or dates specified as such in, or determined in accordance with the provisions of, the relevant Final Terms and, if a Business Day Convention is specified in the relevant Final Terms, as the same may be adjusted in accordance with the relevant Business Day Convention. | |||
Interest Period means the period beginning on (and including) the Interest Commencement Date and ending on (but excluding) the first Interest Payment Date and each successive period beginning on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date. | |||
Interest Period Date means each Interest Payment Date unless otherwise specified in the relevant Final Terms. | |||
ISDA Definitions means the 2006 ISDA Definitions as published by the International Swaps and Derivatives Association, Inc., unless otherwise specified in the relevant Final Terms. | |||
Rate of Interest means the rate of interest payable from time to time in respect of this Instrument and that is either specified on, or calculated in accordance with the provisions of, the relevant Final Terms. | |||
Redemption Amount means, as appropriate, the Final Redemption Amount, the Early Redemption Amount (Tax), the Optional Redemption Amount (Call), the Optional Redemption Amount (Put), the Early Termination Amount or such other amount in the nature of a redemption amount as may be specified in, or determined in accordance with the provisions of the relevant Final Terms. | |||
Reference Banks means, in the case of a determination of LIBOR, the principal London office of four major banks in the London inter-bank market and, in the case of a determination of EURIBOR, the principal Euro-zone office of four major banks in the Euro-zone inter-bank market, in each case selected by the Calculation Agent or as specified in the relevant Final Terms. | |||
Reference Rate means the rate specified as such in the relevant Final Terms. | |||
Relevant Screen Page means such page, section, caption, column or other part of a particular information service as may be specified in the relevant Final Terms. |
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Specified Currency means the currency specified as such in the relevant Final Terms or, if none is specified, the currency in which the Instruments are denominated. | |||
TARGET System means the Trans-European Automated Real-Time Gross Settlement Express Transfer (known as TARGET2) System which was launched on 19 November 2007 or any successor to it. | |||
3.2.6 | Calculation Agent | ||
The Issuer shall procure that there shall at all times be one or more Calculation Agents if provision is made for them in the relevant Final Terms and for so long as any Instrument is outstanding. Where more than one Calculation Agent is appointed in respect of the Instruments, references in these Conditions to the Calculation Agent shall be construed as each Calculation Agent performing its respective duties under these Conditions. If the Calculation Agent is unable or unwilling to act as such or if the Calculation Agent fails duly to establish the Rate of Interest for an Interest Period or Interest Accrual Period or to calculate any Interest Amount, Instalment Amount, Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount, as the case may be, or to comply with any other requirement, the Issuer shall (with the prior approval of the Trustee) appoint a leading bank or investment banking firm engaged in the interbank market (or, if appropriate, money, swap or over-the-counter index options market) which is most closely connected with the calculation or determination to be made by the Calculation Agent (acting through its principal London office or any other office actively involved in such market) to act as such in its place. The Calculation Agent may not resign its duties without a successor having been appointed as specified in this paragraph. |
4 | Indexation | |
This Condition 4 is applicable only if the relevant Final Terms specifies the Instruments as Index Linked Instruments. |
4.1 | Definitions | ||
Base Index Figure means (subject to Condition 4.3(i)) the base index figure as specified in the relevant Final Terms; | |||
Index or Index Figure means, subject as provided in Condition 4.3(i), the U.K. Retail Price Index (RPI) (for all items) published by the Office for National Statistics (January 1987 = 100) or any comparable index which may replace the U.K. Retail Price Index for the purpose of calculating the amount payable on repayment of the Reference Gilt. Any reference to the Index Figure which is specified in the relevant Final Terms as: |
(i) | applicable to a particular month, shall, subject as provided in Conditions 4.3 and 4.5, be construed as a reference to the Index Figure published in the seventh month prior to that particular month and relating to the month before that of publication; or | ||
(ii) | applicable to the first calendar day of any month shall, subject as provided in Conditions 4.3 and 4.5, be construed as a reference to the Index Figure published in the second month prior to that particular month and relating to the month before that of publication; or | ||
(iii) | applicable to any other day in any month shall, subject as provided in Conditions 4.3 and 4.5, be calculated by linear interpolation between (x) the Index Figure applicable to |
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the first calendar day of the month in which the day falls, calculated as specified in sub-paragraph (ii) above and (y) the Index Figure applicable to the first calendar day of the month following, calculated as specified in sub-paragraph (ii) above and rounded to the nearest fifth decimal place. |
If the Index is replaced, the Issuer will describe the replacement Index in a supplement to the Prospectus; | |||
Index Ratio applicable to any month or date, as the case may be, means the Index Figure applicable to such month or date, as the case may be, divided by the Base Index Figure and rounded to the nearest fifth decimal place; | |||
Limited Index Ratio means (a) in respect of any month or date, as the case may be, prior to the relevant Issue Date, the Index Ratio for that month or date, as the case may be, (b) in respect of any Limited Indexation Date after the relevant Issue Date, the product of the Limited Indexation Factor for that month or date, as the case may be, and the Limited Index Ratio as previously calculated in respect of the month or date, as the case may be, twelve months prior thereto; and (c) in respect of any other month, the Limited Index Ratio as previously calculated in respect of the most recent Limited Indexation Month; | |||
Limited Indexation Date
means any date falling during the period specified in the
relevant Final Terms for which a Limited Indexation Factor is to be calculated;
Limited Indexation Factor means, in respect of a Limited Indexation Month or Limited Indexation Date, as the case may be, the ratio of the Index Figure applicable to that month or date, as the case may be, divided by the Index Figure applicable to the month or date, as the case may be, twelve months prior thereto, provided that (a) if such ratio is greater than the Maximum Indexation Factor specified in the relevant Final Terms, it shall be deemed to be equal to such Maximum Indexation Factor and (b) if such ratio is less than the Minimum Indexation Factor specified in the relevant Final Terms, it shall be deemed to be equal to such Minimum Indexation Factor; |
|||
Limited Indexation Month means any month specified in the relevant Final Terms for which a Limited Indexation Factor is to be calculated; | |||
Limited Index Linked Instruments means Index Linked Instruments to which a Maximum Indexation Factor and/or a Minimum Indexation Factor (as specified in the relevant Final Terms) applies; and | |||
Reference Gilt means the Treasury Stock specified as such in the relevant Final Terms for so long as such stock is in issue, and thereafter such issue of index-linked Treasury Stock determined to be appropriate by a gilt-edged market maker or other adviser selected by the Issuer (an Indexation Adviser ). | |||
4.2 | Application of the Index Ratio | ||
Each payment of interest and principal in respect of the Instruments shall be the amount provided in, or determined in accordance with, these Conditions, multiplied by the Index Ratio or Limited Index Ratio in the case of Limited Index Linked Instruments applicable to the month or date, as the case may be, on which such payment falls to be made and rounded in accordance with Condition 3.2.4(e). | |||
4.3 | Changes in Circumstances Affecting the Index |
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(i) | Change in base: If at any time and from time to time the Index is changed by the substitution of a new base therefor, then with effect from the month from and including that in which such substitution takes effect or the first date from and including that on which such substitution takes effect, as the case may be, (1) the definition of Index and Index Figure in Condition 4.1 shall be deemed to refer to the new date or month in substitution for January 1987 (or, as the case may be, to such other date or month as may have been substituted therefor), and (2) the new Base Index Figure shall be the product of the existing Base Index Figure and the Index Figure for the date on which such substitution takes effect, divided by the Index Figure for the date immediately preceding the date on which such substitution takes effect. | ||
(ii) | Delay in publication of Index if sub-paragraph (i) of the definition of Index Figure is applicable: If the Index Figure which is normally published in the seventh month and which relates to the eighth month (the relevant month ) before the month in which a payment is due to be made is not published on or before the fourteenth business day before the date on which such payment is due (the date for payment ), the Index Figure applicable to the month in which the date for payment falls shall be (1) such substitute index figure (if any) as the Trustee considers (acting solely on the advice of the Indexation Adviser) to have been published by the United Kingdom Debt Management Office or the Bank of England, as the case may be, for the purposes of indexation of payments on the Reference Gilt or, failing such publication, on any one or more issues of index-linked Treasury Stock selected by an Indexation Adviser (and approved by the Trustee (acting solely on the advice of the Indexation Adviser)) or (2) if no such determination is made by such Indexation Adviser within seven days, the Index Figure last published (or, if later, the substitute index figure last determined pursuant to Condition 4.3(i)) before the date for payment. | ||
(iii) | Delay in publication of Index if sub-paragraph (ii) and/or (iii) of the definition of Index Figure is applicable: If the Index Figure relating to any month (the calculation month ) which is required to be taken into account for the purposes of the determination of the Index Figure for any date is not published on or before the fourteenth business day before the date on which such payment is due (the date for payment ), the Index Figure applicable for the relevant calculation month shall be (1) such substitute index figure (if any) as the Trustee considers (acting solely on the advice of the Indexation Adviser) to have been published by the United Kingdom Debt Management Office or the Bank of England, as the case may be, for the purposes of indexation of payments on the Reference Gilt or, failing such publication, on any one or more issues of index-linked Treasury Stock selected by an Indexation Adviser (and approved by the Trustee (acting solely on the advice of the Indexation Adviser)) or (2) if no such determination is made by such Indexation Adviser within seven days, the Index Figure last published (or, if later, the substitute index figure last determined pursuant to Condition 4.3(i)) before the date for payment. |
4.4 | Application of Changes | ||
Where the provisions of Condition 4.3(ii) or Condition 4.3(iii) apply, the determination of the Indexation Adviser as to the Index Figure applicable to the month in which the date for payment falls or the date for payment, as the case may be, shall be conclusive and binding. If, an Index Figure having been applied pursuant to Condition 4.3(ii)(2) or Condition 4.3(iii)(2), the Index Figure relating to the relevant month or relevant calculation month, as the case may be, is subsequently published while an Instrument is still outstanding, then: |
72
(i) | in relation to a payment of principal or interest in respect of such Instrument other than upon final redemption of such Instrument, the principal or interest (as the case may be) next payable after the date of such subsequent publication shall be increased or reduced, as the case may be, by an amount equal to the shortfall or excess, as the case may be, of the amount of the relevant payment made on the basis of the Index Figure applicable by virtue of Condition 4.3(ii)(2) or Condition 4.3(iii)(2) below or above the amount of the relevant payment that would have been due if the Index Figure subsequently published had been published on or before the fourteenth business day before the date for payment; and | ||
(ii) | in relation to a payment of principal or interest upon final redemption, no subsequent adjustment to amounts paid will be made. |
4.5 | Cessation of or Fundamental Changes to the Index |
(i) | If (1) the Trustee has been notified by the Calculation Agent that the Index has ceased to be published or (2) any change is made to the coverage or the basic calculation of the Index which constitutes a fundamental change which would, in the opinion of (A) the Issuer be materially prejudicial to the interests of the Issuer, or (B) the Trustee (acting solely on the advice of the Indexation Adviser), be materially prejudicial to the interests of the Instrumentholders, the Trustee will give written notice of such occurrence to the Issuer in the case of (B), and the Issuer and the Trustee (acting solely on the advice of the Indexation Adviser) together shall seek to agree for the purpose of the Instruments one or more adjustments to the Index or a substitute index (with or without adjustments) with the intention that the same should leave the Issuer and the Instrumentholders in no better and no worse position than they would have been had the Index not ceased to be published or the relevant fundamental change not been made. | ||
(ii) | If the Issuer and the Trustee (acting solely on the advice of the Indexation Adviser) fail to reach agreement as mentioned above within 20 business days following the giving of notice as mentioned in paragraph (i), a bank or other person in London shall be appointed by the Issuer and the Trustee or, failing agreement on and the making of such appointment within 20 business days following the expiry of the 20 day period referred to above, by the Trustee (acting solely on the advice of the Indexation Adviser) (in each case, such bank or other person so appointed being referred to as the Expert ), to determine for the purpose of the Instruments one or more adjustments to the Index or a substitute index (with or without adjustments) with the intention that the same should leave the Issuer and the Instrumentholders in no better and no worse position than they would have been had the Index not ceased to be published or the relevant fundamental change not been made. Any Expert so appointed shall act as an expert and not as an arbitrator and all fees, costs and expenses of the Expert and of any Indexation Adviser and of any of the Issuer and the Trustee in connection with such appointment shall be borne by the Issuer. | ||
(iii) | The Index shall be adjusted or replaced by a substitute index as agreed by the Issuer and the Trustee (acting solely on the advice of the Indexation Adviser) or as determined by the Expert pursuant to the foregoing paragraphs, as the case may be, and references in these Conditions to the Index and to any Index Figure shall be deemed amended in such manner as the Trustee (acting solely on the advice of the Indexation Adviser) and the Issuer agree are appropriate to give effect to such |
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adjustment or replacement. Such amendments shall be effective from the date of such notification and binding upon the Issuer, the Trustee and the Instrumentholders, and the Issuer shall give notice to the Instrumentholders in accordance with Condition 14 of such amendments as promptly as practicable following such notification. |
4.6 | Redemption for Index Reasons | ||
If either (i) the Index Figure for three consecutive months is required to be determined on the basis of an Index Figure previously published as provided in Condition 4.3(ii)(2) and the Trustee has been notified by the Calculation Agent that publication of the Index has ceased or (ii) notice is published by Her Majestys Treasury, or on its behalf, following a change in relation to the Index, offering a right of redemption to the holders of the Reference Gilt, and (in either case) no amendment or substitution of the Index shall have been advised by the Indexation Adviser to the Issuer and such circumstances are continuing, the Issuer may, upon giving not more than 60 nor less than 30 days notice to the Instrumentholders in accordance with Condition 14, redeem all, but not some only, of the Instruments at their principal amount together with interest accrued but unpaid up to and including the date of redemption (in each case adjusted in accordance with Condition 4.2). |
Where HICP (as defined below) is specified as the Index or Index Level (each as defined below) in the relevant Final Terms, the following Conditions 4.7 to 4.10 will apply: |
4.7 | Definitions | ||
Base Index Level means the base index level as specified in the relevant Final Terms; | |||
Index or Index Level means (subject as provided in Condition 4.9) the Non-revised Index of Consumer Prices excluding tobacco or relevant Successor Index (as defined in Condition 4.9 (i)), measuring the rate of inflation in the European Monetary Union excluding tobacco, expressed as an index and published by Eurostat (the HICP ). The first publication or announcement of a level of such index for a calculation month (as defined in Condition 4.9 (i)) shall be final and conclusive and later revisions to the level for such calculation month will not be used in any calculations. Any reference to the Index Level which is specified in these Conditions as applicable to any day ( d ) in any month ( m ) shall, subject as provided in Condition 4.9, be calculated as follows: |
I d = HICP m-3 + |
nbd
q m |
x (HICP m-2 HICP m-3 ) |
where: | |||
I d is the Index Level for the day d | |||
HICP m-2 is the level of HICP for month m-2 | |||
HICP m-3 is the level of HICP for month m-3 | |||
nbd is the actual number of days from and excluding the first day of month m to but including day d; and | |||
q m is the actual number of days in month m, | |||
provided that if Condition 4.9 applies, the Index Level shall be the Substitute Index Level determined in accordance with such Condition. |
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If the Index is replaced, the Issuer will describe the replacement Index in a supplement to the Prospectus; | |||
Index Business Day means a day on which the TARGET System is operating; | |||
Index Determination Date means in respect of any date for which the Index Level is required to be determined, the fifth Index Business Day prior to such date; | |||
Index Ratio applicable to any date means the Index Level applicable to the relevant Index Determination Date divided by the Base Index Level and rounded to the nearest fifth decimal place, 0.000005 being rounded upwards; | |||
Related Instrument means an inflation-linked bond selected by the Calculation Agent that is a debt obligation of one of the governments (but not any government agency) of France, Italy, Germany or Spain and which pays a coupon or redemption amount which is calculated by reference to the level of inflation in the European Monetary Union with a maturity date which falls on (a) the same day as the Maturity Date, (b) the next longest maturity date after the Maturity Date if there is no such bond maturing on the Maturity Date, or (c) the next shortest maturity before the Maturity Date if no bond defined in (a) or (b) is selected by the Calculation Agent. The Calculation Agent will select the Related Instrument from such of those inflation-linked bonds issued on or before the relevant Issue Date and, if there is more than one such inflation-linked bond maturing on the same date, the Related Instrument shall be selected by the Calculation Agent from such of those bonds. If the Related Instrument is redeemed the Calculation Agent will select a new Related Instrument on the same basis, but selected from all eligible bonds in issue at the time the originally selected Related Instrument is redeemed (including any bond for which the redeemed originally selected Related Instrument is exchanged). | |||
4.8 | Application of the Index Ratio | ||
Each payment of interest and principal in respect of the Instruments shall be the amount provided in, or determined in accordance with, these Conditions, multiplied by the Index Ratio applicable to the date on which such payment falls to be made and rounded in accordance with Condition 3.2.4(e). | |||
4.9 | Changes in Circumstances Affecting the Index |
(i) | Delay in publication of Index |
(a) | If the Index Level relating to any month (the calculation month ) which is required to be taken into account for the purposes of the determination of the Index Level for any date (the Relevant Level ) has not been published or announced by the day that is five Business Days before the date on which such payment is due (the Affected Payment Date ), the Calculation Agent shall determine a Substitute Index Level (as defined below) (in place of such Relevant Level) by using the following methodology: |
(1) | if applicable, the Calculation Agent will take the same action to determine the Substitute Index Level for the Affected Payment Date as that taken by the calculation agent (or any other party performing the function of a calculation agent (whatever such partys title)) pursuant to the terms and conditions of the Related Instrument; |
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(2) | if (1) above does not result in a Substitute Index Level for the Affected Payment Date for any reason, then the Calculation Agent shall determine the Substitute Index Level as follows: | ||
Substitute Index Level = Base Level x (Latest Level / Reference Level) | |||
Where: | |||
Base Level means the level of the Index (excluding any flash estimates) published or announced by Eurostat (or any successor entity which publishes such index) in respect of the month which is 12 calendar months prior to the month for which the Substitute Index Level is being determined; | |||
Latest Level means the latest level of the Index (excluding any flash estimates) published or announced by Eurostat (or any successor entity which publishes such index) prior to the month in respect of which the Substitute Index Level is being calculated; and | |||
Reference Level means the level of the Index (excluding any flash estimates) published or announced by Eurostat (or any successor entity which publishes such index) in respect of the month that is 12 calendar months prior to the month referred to in Latest Level above. |
(b) | If a Relevant Level is published or announced at any time after the day that is five Business Days prior to the next Interest Payment Date, such Relevant Level will not be used in any calculations. The Substitute Index Level so determined pursuant to this Condition 4.9(i) will be the definitive level for that calculation month. |
(ii) | Cessation of publication: If the Index Level has not been published or announced for two consecutive months or Eurostat announces that it will no longer continue to publish or announce the Index then the Calculation Agent shall determine a successor index in lieu of any previously applicable Index (the Successor Index ) by using the following methodology: |
(a) | if at any time (other than after an Early Termination Event (as defined below) has been designated by the Calculation Agent pursuant to paragraph (e) below) a successor index has been designated by the calculation agent (or any other party performing the function of a calculation agent (whatever such partys title)) pursuant to the terms and conditions of the Related Instrument, such successor index shall be designated the Successor Index for the purposes of all subsequent Interest Payment Dates, notwithstanding that any other Successor Index may previously have been determined under paragraphs (b), (c) or (d) below; or | ||
(b) | if a Successor Index has not been determined under paragraph (a) above (and there has been no designation of an Early Termination Event pursuant to paragraph (e) below), and a notice has been given or an announcement has been made by Eurostat (or any successor entity which publishes such index) specifying that the Index will be superseded by a replacement index specified by Eurostat (or any such successor), and the Calculation Agent determines that such replacement index is calculated using the same or substantially similar |
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formula or method of calculation as used in the calculation of the previously applicable Index, such replacement index shall be the Index from the date that such replacement index comes into effect; or | |||
(c) | if a Successor Index has not been determined under paragraphs (a) or (b) above (and there has been no designation of an Early Termination Event pursuant to paragraph (e) below), the Calculation Agent shall ask five leading independent dealers to state what the replacement index for the Index should be. If between four and five responses are received, and of those four or five responses, three or more leading independent dealers state the same index, this index will be deemed the Successor Index. If three responses are received, and two or more leading independent dealers state the same index, this index will be deemed the Successor Index. If fewer than three responses are received, the Calculation Agent will proceed to paragraph (d) below; | ||
(d) | if no Successor Index has been determined under paragraphs (a), (b) or (c) above on or before the fifth Index Business Day prior to the next Affected Payment Date the Calculation Agent will determine an appropriate alternative index for such Affected Payment Date, and such index will be deemed the Successor Index; | ||
(e) | if the Calculation Agent determines that there is no appropriate alternative index, the Issuer and the Instrumentholders shall, in conjunction with the Calculation Agent, determine an appropriate alternative index. If the Issuer and the Instrumentholders, in conjunction with the Calculation Agent, do not reach agreement on an appropriate alternative index within a period of ten Business Days, then an Early Termination Event will be deemed to have occurred and the Issuer will redeem the Instruments pursuant to Condition 4.10. |
(iii) | Rebasing of the Index: If the Calculation Agent determines that the Index has been or will be rebased at any time, the Index as so rebased (the Rebased Index ) will be used for the purposes of determining each relevant Index Level from the date of such rebasing; provided, however, that the Calculation Agent shall make such adjustments as are made by the calculation agent (or any other party performing the function of a calculation agent (whatever such partys title)) pursuant to the terms and conditions of the Related Instrument to the levels of the Rebased Index so that the Rebased Index levels reflect the same rate of inflation as the Index before it was rebased. Any such rebasing shall not affect any prior payments made. | ||
(iv) | Material Modification Prior to Interest Payment Date: If, on or prior to the day that is five Business Days before an Interest Payment Date, Eurostat announces that it will make a material change to the Index then the Calculation Agent shall make any such adjustments to the Index consistent with adjustments made to the Related Instrument. | ||
(v) | Manifest Error in Publication: If, within thirty days of publication, the Calculation Agent determines that Eurostat (or any successor entity which publishes such index) has corrected the level of the Index to remedy a manifest error in its original publication, the Calculation Agent will notify the parties of (A) that correction, (B) the amount that is payable as a result of that correction and (C) take such other action as it may deem necessary to give effect to such correction. |
4.10 | Redemption for Index Reasons |
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If an Early Termination Event as described under Condition 4.9(ii)(e) is deemed to have occurred, the Issuer will, upon giving not more than 60 nor less than 30 days notice to the Instrumentholders in accordance with Condition 14, redeem all, but not some only, of the Instruments at their principal amount together with interest accrued but unpaid up to and including the date of redemption (in each case adjusted in accordance with Condition 4.8). |
5 | Redemption, Purchase and Options |
5.1 | Final Redemption | ||
Unless previously redeemed, purchased and cancelled as provided below, this Instrument will be redeemed at its Final Redemption Amount (which, unless otherwise provided, is its nominal amount) on the Maturity Date specified in the relevant Final Terms provided, however, that if this Instrument is a Perpetual Instrument it will only be redeemable and repayable in accordance with the following provisions of this Condition 5. | |||
5.2 | Redemption for Taxation Reasons | ||
If, on the occasion of the next payment in respect of the Instruments the Issuer satisfies the Trustee immediately before the giving of the notice referred to below that it would be unable to make such payment without having to pay additional amounts as described in Condition 7, and such requirement to pay such additional amounts arises by reason of a change in the laws of the United Kingdom or any political sub-division of the United Kingdom or taxing authority in the United Kingdom or any political sub-division of the United Kingdom or in the interpretation or application of the laws of the United Kingdom or any political sub-division of the United Kingdom or in any applicable double taxation treaty or convention, which change becomes effective on or after the date on which agreement is reached to issue the first Tranche of the Instruments, and such requirement cannot be avoided by the Issuer taking reasonable measures (such measures not involving any material additional payments by, or expense for, the Issuer), the Issuer may, at its option, at any time, having given not less than 30 nor more than 45 days notice to the Instrumentholders in accordance with Condition 14, redeem all, but not some only, of the Instruments at their Early Redemption Amount together with interest accrued to the date of redemption provided that the date fixed for redemption shall not be earlier than 90 days prior to the earliest date on which the Issuer would be obliged to pay such additional amounts or make such withholding or deduction, as the case may be, were a payment in respect of the Instruments then due. Prior to the publication of any notice of redemption pursuant to this Condition 5.2, the Issuer shall deliver to the Trustee a certificate signed by two Directors of the Issuer stating that the requirement referred to above cannot be avoided by the Issuer taking reasonable measures available to it and the Trustee shall be entitled to accept such certificate as sufficient evidence of the satisfaction of the condition precedent set out above in which event it shall be conclusive and binding on Instrumentholders and Couponholders. | |||
5.3 | Purchases | ||
The Issuer and any of its subsidiary undertakings may at any time purchase Instruments (provided that all unmatured Receipts and Coupons and unexchanged Talons appertaining to them are attached or surrendered with them) in the open market or otherwise at any price. | |||
5.4 | Early Redemption |
5.4.1 | Zero Coupon Instruments |
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(a) | The Early Redemption Amount payable in respect of any Zero Coupon Instrument, the Early Redemption Amount of which is not linked to an index and/or a formula, upon redemption of such Instrument pursuant to Condition 5.2 or upon it becoming due and payable as provided in Condition 9 shall be the Amortised Face Amount (calculated as provided below) of such Instrument unless otherwise specified in the relevant Final Terms. | ||
(b) | Subject to the provisions of sub-paragraph (c) below, the Amortised Face Amount of any such Instrument shall be the scheduled Final Redemption Amount of such Instrument on the Maturity Date discounted at a rate per annum (expressed as a percentage) equal to the Amortisation Yield (which, if none is specified in the relevant Final Terms, shall be such rate as would produce an Amortised Face Amount equal to the issue price of the Instruments if they were discounted back to their issue price on the Issue Date) compounded annually. | ||
(c) | If the Early Redemption Amount payable in respect of any such Instrument upon its redemption pursuant to Condition 5.2 or, if applicable, Condition 5.5 or 5.6 or upon it becoming due and payable as provided in Condition 9, is not paid when due, the Early Redemption Amount due and payable in respect of such Instrument shall be the Amortised Face Amount of such Instrument as defined in sub-paragraph (b) above, except that such sub-paragraph shall have effect as though the reference in that sub-paragraph to the date on which the Instrument becomes due and payable was replaced by a reference to the Relevant Date as defined in Condition 7. The calculation of the Amortised Face Amount in accordance with this sub-paragraph shall continue to be made (both before and after judgment) until the Relevant Date, unless the Relevant Date falls on or after the Maturity Date, in which case the amount due and payable shall be the scheduled Final Redemption Amount of such Instrument on the Maturity Date together with any interest that may accrue in accordance with Condition 3.2. |
Where such calculation is to be made for a period of less than one year, it shall be made on the basis of the Day Count Fraction specified in the relevant Final Terms. | |||
5.4.2 | Other Instruments | ||
The Early Redemption Amount payable in respect of any Instrument (other than Instruments described in Condition 5.4.1), upon redemption of such Instrument pursuant to this Condition 5.4 or upon it becoming due and payable as provided in Condition 9, shall be the Final Redemption Amount unless otherwise specified in the relevant Final Terms. |
5.5 | Redemption at the Option of the Issuer and Exercise of Issuers Options |
5.5.1 | If (i) Residual Holding Call Option is specified in the relevant Final Terms, and (ii) if at any time the Residual Holding Percentage or more of the aggregate nominal amount of Instruments originally issued shall have been redeemed or purchased and cancelled, the Issuer shall have the option to redeem such outstanding Instruments in whole, but not in part, at their Residual Holding Redemption Amount. Unless otherwise specified in the relevant Final Terms, the Residual Holding Redemption Amount will be calculated by the Calculation Agent by discounting the outstanding nominal amount of the Instruments and the remaining interest payments (if applicable) to the Maturity Date by a rate per annum (expressed as a percentage to the nearest one hundred |
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thousandth of a percentage point (with halves being rounded up)) equal to the Benchmark Yield, being the yield on the Benchmark Security at the close of business on the third Business Day prior to the date fixed for such redemption, plus the Benchmark Spread. Where the specified calculation is to be made for a period of less than one year, it shall be calculated using the Benchmark Day Count Fraction. The Issuer will give not less than 15 nor more than 30 days irrevocable notice to the Instrumentholders and the Trustee of any such redemption pursuant to this Condition 5.5.1. | |||
5.5.2 | If Call Option is specified in the relevant Final Terms, the Issuer may, on giving not less than 15 nor more than 30 days irrevocable notice to the Instrumentholders (or such other notice period as may be specified in the relevant Final Terms), redeem, or exercise any Issuers option in relation to, all or, if so provided, some of such Instruments on any Optional Redemption Date or Option Exercise Date, as the case may be. Any such redemption of Instruments shall be at their Optional Redemption Amount together with interest accrued to the date fixed for redemption. Any such redemption or exercise must relate to Instruments of a nominal amount at least equal to the minimum nominal amount (if any) permitted to be redeemed specified hereon and no greater than the maximum nominal amount (if any) permitted to be redeemed specified on this Instrument. |
All Instruments in respect of which any such notice is given shall be redeemed, or the Issuers option shall be exercised, on the date specified in such notice in accordance with this Condition. | |||
In the case of a partial redemption or a partial exercise of an Issuers option, the notice to Instrumentholders shall also contain the serial numbers of the Instruments to be redeemed, which shall have been drawn in such place as the Trustee may approve and in such manner as it deems appropriate, subject to compliance with any applicable laws, listing authority and stock exchange requirements. | |||
5.6 | Redemption at the Option of Instrumentholders following a Restructuring Event |
5.6.1 | * [ Redemption of Instruments issued by National Grid at the option of Instrumentholders | ||
If at any time whilst any of the Instruments issued by National Grid remains outstanding, there occurs the National Grid Restructuring Event, a Public Announcement shall be made and if, within the National Grid Restructuring Period, either: |
(a) | (if at the time that the National Grid Restructuring Event occurs there are Rated Securities) a Rating Downgrade in respect of the National Grid Restructuring Event occurs; or | ||
(b) | (if at the time that the National Grid Restructuring Event occurs there are no Rated Securities) a Negative Rating Event in respect of the National Grid Restructuring Event occurs, |
(the National Grid Restructuring Event and Rating Downgrade or the National Grid Restructuring Event and Negative Rating Event, as the case may be, occurring within the National Grid Restructuring Period, together called a Put Event ), |
* | Only applicable where National Grid is the Issuer. |
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then the holder of each Instrument issued by National Grid will have the option upon the giving of a Put Notice (as defined in Condition 5.6.4) to require National Grid to redeem or, at the option of National Grid, purchase (or procure the purchase of) such Instrument on the Put Date (as defined in Condition 5.6.4) at its principal amount together with accrued interest to the Put Date. | |||
Promptly upon National Grid becoming aware that a Put Event has occurred, National Grid shall, or at any time upon the Trustee becoming similarly so aware the Trustee may, and if so requested in writing by the holders of at least one-quarter in principal amount of the Instruments then outstanding or if so directed by an Extraordinary Resolution of the Instrumentholders, the Trustee shall, give notice (a Put Event Notice ) to the Instrumentholders in accordance with Condition 14 specifying the nature of the Put Event and the procedure (as set out in Condition 5.6.4) for exercising the option contained in this Condition 5.6.1. | |||
National Grid shall, forthwith upon becoming aware of the occurrence of the National Grid Restructuring Event (a) provide the Trustee with the relevant Directors Report and (b) provide or procure that the Reporting Accountants provide the Trustee with the Accountants Report. The Directors Report and the Accountants Report shall, in the absence of manifest error, be conclusive and binding on all concerned, including the Trustee and the Instrumentholders. The Trustee shall be entitled to act, or not act, and rely on without being expected to verify the accuracy of the same (and shall have no liability to Instrumentholders for doing so) any Directors Report and/or any Accountants Report (whether or not addressed to it). | |||
5.6.2 | For the purposes of this Condition | ||
Accountants Report means a report of the Reporting Accountants stating whether the amounts included in the calculation of the Operating Profit and the amount for Consolidated Operating Profit as included in the Directors Report have been accurately extracted from the accounting records of National Grid and its Subsidiaries and whether the Disposal Percentage included in the Directors Report has been correctly calculated which will be prepared pursuant to an engagement letter to be entered into by the Reporting Accountants, National Grid and the Trustee. | |||
National Grid shall use reasonable endeavours to procure that there shall at the relevant time be Reporting Accountants who have (a) entered into an engagement letter with National Grid and the Trustee which shall (i) not limit the liability of the Reporting Accountants to the Trustee by reference to a monetary cap and (ii) be available for inspection by Instrumentholders at the principal office of the Trustee or (b) agreed to provide Accountants Reports on such other terms as National Grid and the Trustee shall approve. If National Grid, having used reasonable endeavours, is unable to procure that there shall at the relevant time be Reporting Accountants who have entered into an engagement letter complying with (i) above, the Trustee may rely on an Accountants Report which contains a limit on the liability of the Reporting Accountants by reference to a monetary cap or otherwise. | |||
Investors should be aware that the engagement letter may contain a limit on the liability of the Reporting Accountants which may impact on the interests of Instrumentholders. |
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National Grid shall give notice to the Trustee of the identity of the Reporting Accountants; | |||
Consolidated Operating Profit means the consolidated operating profit on ordinary activities before tax and interest and before taking account of depreciation and amortisation of goodwill and regulatory assets (for the avoidance of doubt, exceptional items, as reflected in the Relevant Accounts shall not be included) of National Grid and its subsidiaries (including any share of operating profit of associates and joint ventures) determined in accordance with International Financial Reporting Standards ( IFRS ) by reference to the Relevant Accounts; | |||
Directors Report means a report prepared and signed by two directors of National Grid addressed to the Trustee setting out the Operating Profit, the Consolidated Operating Profit and the Disposal Percentage and stating any assumptions which the Directors of National Grid have employed in determining the Operating Profit; | |||
Disposal Percentage means, in relation to a sale, transfer, lease or other disposal or dispossession of any Disposed Assets, the ratio of (a) the aggregate Operating Profit to (b) the Consolidated Operating Profit, expressed as a percentage; | |||
Disposed Assets means, where National Grid and/or any of its Subsidiaries sells, transfers, leases or otherwise disposes of or is dispossessed by any means (but excluding sales, transfers, leases, disposals or dispossessions which, when taken together with any related lease back or similar arrangements entered into in the ordinary course of business, have the result that Operating Profit directly attributable to any such undertaking, property or assets continues to accrue to National Grid or, as the case may be, such Subsidiary), otherwise than to a wholly-owned Subsidiary of National Grid or to National Grid, of the whole or any part (whether by a single transaction or by a number of transactions whether related or not) of its undertaking or (except in the ordinary course of business of National Grid or any such Subsidiary) property or assets, the undertaking, property or assets sold, transferred, leased or otherwise disposed of or of which it is so dispossessed; | |||
Negative Rating Event shall be deemed to have occurred if either (a) National Grid does not, either prior to or not later than 21 days after the relevant National Grid Restructuring Event, seek, and thereupon use all reasonable endeavours to obtain, a rating of the Instruments or any other unsecured and unsubordinated debt of National Grid having an initial maturity of five years or more ( Rateable Debt ) from a Rating Agency or (b) if National Grid does so seek and use such endeavours, it is unable, as a result of such National Grid Restructuring Event, to obtain such a rating of at least investment grade (BBB- or Baa3 or their respective equivalents for the time being), provided that a Negative Rating Event shall not be deemed to have occurred in respect of a particular National Grid Restructuring Event if the Rating Agency declining to assign a rating of at least investment grade (as described above) does not announce or publicly confirm that its declining to assign a rating of at least investment grade was the result, in whole or in part, of any event or circumstance comprised in or arising as a result of, or in respect of, the applicable National Grid Restructuring Event (whether or not the National Grid Restructuring Event shall have occurred at the time such investment grade rating is declined); | |||
National Grid Restructuring Event shall be deemed to have occurred at any time (whether or not approved by the Board of Directors of National Grid) that the sum of |
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Disposal Percentages for National Grid within any period of 36 months commencing on or after the issue date of the first Tranche of the Instruments is greater than 50 per cent.; | |||
National Grid Restructuring Period means the period ending 90 days after a Public Announcement (or such longer period in which the Rated Securities or Rateable Debt, as the case may be, is or are under consideration (announced publicly within the first mentioned period) for rating review or, as the case may be, rating by a Rating Agency); | |||
Operating Profit , in relation to any Disposed Assets, means the operating profits on ordinary activities before tax and interest and before taking account of depreciation and amortisation of goodwill and regulatory assets (for the avoidance of doubt, exceptional items, as reflected in the Relevant Accounts, shall not be included) of National Grid and its Subsidiaries directly attributable to such Disposed Assets as determined in accordance with IFRS by reference to the Relevant Accounts and, if Relevant Accounts do not yet exist, determined in a manner consistent with the assumptions upon which the Directors Report is to be based. Where the Directors of National Grid have employed assumptions in determining the Operating Profit, those assumptions should be clearly stated in the Directors Report; | |||
Public Announcement means an announcement by National Grid or the Trustee, of the occurrence of the National Grid Restructuring Event published in a leading national newspaper having general circulation in the United Kingdom (which is expected to be the Financial Times ); | |||
Rated Securities means the Instruments, if and for so long as they shall have an effective rating from a Rating Agency and otherwise any Rateable Debt which is rated by a Rating Agency; provided that if there shall be no such Rateable Debt outstanding prior to the maturity of the Instruments, the holders of not less than one-quarter in principal amount of outstanding Instruments may require National Grid to obtain and thereafter update on an annual basis a rating of the Instruments from a Rating Agency. In addition, National Grid may at any time obtain and thereafter update on an annual basis a rating of the Instruments from a Rating Agency, provided that , except as provided above, National Grid shall not have any obligation to obtain such a rating of the Instruments; | |||
Rating Agency means Standard & Poors Ratings Services, a division of The McGraw-Hill Companies, Inc. and its successors or Moodys Investors Service, Inc. and its successors or any rating agency substituted for either of them (or any permitted substitute of them) by National Grid from time to time with the prior written approval of the Trustee; | |||
Rating Downgrade shall be deemed to have occurred in respect of the National Grid Restructuring Event if the then current rating whether provided by a Rating Agency at the invitation of National Grid or by its own volition assigned to the Rated Securities by any Rating Agency is withdrawn or reduced from an investment grade rating (BBB- or Baa3 or their respective equivalents for the time being or better) to a non-investment grade rating (BB+ or Ba1 or their respective equivalents for the time being or worse) or, if a Rating Agency shall already have rated the Rated Securities below investment grade (as described above), the rating is lowered one full rating category; provided that a Rating Downgrade otherwise arising by virtue of a particular reduction in rating shall not be deemed to have occurred in respect of a particular National Grid Restructuring |
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Event if the Rating Agency making the reduction in rating to which this definition would otherwise apply does not announce or publicly confirm that the reduction was the result, in whole or part, of any event or circumstance comprised in or arising as a result of, or in respect of, the applicable National Grid Restructuring Event (whether or not the applicable National Grid Restructuring Event shall have occurred at the time of the Rating Downgrade); | |||
Relevant Accounts means the most recent annual audited consolidated financial accounts of National Grid and its Subsidiaries preceding the relevant sale, transfer, lease or other disposal or dispossession of any Disposed Asset; | |||
Reporting Accountants means the auditors of National Grid (but not acting in their capacity as auditors) or such other firm of accountants as may be nominated by National Grid and approved in writing by the Trustee for the purpose or, failing which, as may be selected by the Trustee for the purpose; and | |||
Subsidiary means a subsidiary within the meaning of Section 1159 of the Companies Act 2006 and Subsidiaries shall be construed accordingly. | |||
5.6.3 | The Trustee shall not be responsible for ascertaining or monitoring whether or not the National Grid Restructuring Event, a Negative Rating Event or a Rating Downgrade in relation to National Grid has occurred and, unless and until it has actual knowledge to the contrary, shall be entitled to assume that no such event has occurred. | ||
5.6.4 | To exercise the option of redemption of an Instrument under Condition 5.6.1 the Instrumentholder must deliver each Instrument to be redeemed accompanied by a duly signed and completed notice of exercise in the form (for the time being current) obtainable from the specified office of any Paying Agent (a Put Notice ) and, in which the Instrumentholder may specify an account to which payment is to be made under this Condition 5.6 to the specified office of any Paying Agent on any business day falling within the period (the Put Period ) of 45 days after a Put Event Notice is given. The Instrument should be delivered together with all Receipts and Coupons (and Talons) appertaining thereto maturing after the date (the Put Date ) falling seven days after the expiry of the Put Period, failing which (unless Condition 6.5.2 applies) the Paying Agent will require payment of an amount equal to the face value of any such missing Receipt, Coupon and/or Talon. Any amount so paid will be reimbursed in the manner provided in Condition 6 against presentation and surrender of the relevant missing Receipt, Coupon and/or Talon, subject to Condition 8. The Paying Agent to which such Instrument and Put Notice are delivered will issue to the Instrumentholder concerned a non-transferable receipt in respect of the Instrument so delivered. Payment in respect of any Instrument so delivered will be made, if the Instrumentholder duly specified a bank account in the Put Notice to which payment is to be made, on the Put Date by transfer to that bank account and, in every other case, on or after the Put Date in the manner provided in Condition 6 against presentation and surrender (or, in the case of part payment, endorsement) of such receipt at the specified office of any Paying Agent. A Put Notice, once given, shall be irrevocable. For the purposes of the Conditions and the Trust Deed, receipts issued pursuant to this Condition 5.6 shall be treated as if they were Instruments. National Grid shall redeem the relevant Instruments on the Put Date unless previously redeemed or purchased.] |
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5.6.1 | * [ Redemption of Instruments issued by NGET at the option of Instrumentholders | ||
If NGET Restructuring Put Option is specified in the relevant Final Terms and at any time whilst any of the Instruments issued by NGET remains outstanding there occurs an NGET Restructuring Event and in relation to that NGET Restructuring Event, a Negative Certification is made and, within the NGET Restructuring Period either: |
(a) | (if at the time that an NGET Restructuring Event occurs there are Rated Securities) a Rating Downgrade in respect of the relevant NGET Restructuring Event occurs; or | ||
(b) | (if at the time that an NGET Restructuring Event occurs there are no Rated Securities) a Negative Rating Event in respect of the relevant NGET Restructuring Event occurs, |
(the NGET Restructuring Event and Rating Downgrade or the NGET Restructuring Event and Negative Rating Event, as the case may be, occurring within the NGET Restructuring Period, together with a Negative Certification, shall be called a Put Event ), | |||
then the holder of each Instrument of NGET will have the option upon the giving of a Put Notice (as defined in Condition 5.6.4) to require NGET to redeem or, at the option of NGET, purchase (or procure the purchase of) such Instrument on the Put Date (as defined in Condition 5.6.4) at its principal amount together with accrued interest to the Put Date. | |||
Promptly upon NGET becoming aware that a Put Event has occurred, and in any event no later than 14 days after the occurrence of a Put Event, NGET shall, or at any time upon the Trustee becoming similarly so aware the Trustee may, and if so requested in writing by the holders of at least one-quarter in principal amount of the Instruments then outstanding or if so directed by an Extraordinary Resolution of the Instrumentholders, the Trustee shall, give notice (a Put Event Notice ) to the Instrumentholders in accordance with Condition 14 specifying the nature of the Put Event and the procedure (as set out in Condition 5.6.4) for exercising the option contained in this Condition 5.6.1. | |||
5.6.2 | For the purposes of this Condition | ||
Electricity Act means the Electricity Act 1989 as amended or re-enacted from time to time and all subordinate legislation made pursuant thereto; | |||
Electricity Transmission Licence means the transmission licence, as subsequently amended from time to time, originally granted by the Secretary of State for Energy to NGET under the Electricity Act; | |||
Negative Certification means, on the occurrence of an NGET Restructuring Event, such event or events being certified in writing by an independent financial adviser appointed by NGET and approved by the Trustee (or, if NGET shall not have appointed such an adviser within 21 days after becoming aware of the occurrence of such NGET Restructuring Event, appointed by the Trustee (following consultation with NGET)) as |
* | Only applicable where NGET is the Issuer. |
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being in its opinion materially prejudicial to the interests of the Instrumentholders. Any Negative Certification by an independent financial adviser as to whether or not, in its opinion, any event defined as an NGET Restructuring Event is materially prejudicial to the interests of the Instrumentholders shall, in the absence of manifest error, be conclusive and binding upon NGET, the Trustee, the Instrumentholders and the Couponholders; | |||
Negative Rating Event shall be deemed to have occurred if NGET is unable as a result of an NGET Restructuring Event to obtain a rating of the Instruments or of any other comparable unsecured and unsubordinated debt of NGET (or of any Subsidiary of NGET and which is guaranteed on an unsecured and unsubordinated basis by NGET) having an initial maturity of five years or more ( Rateable Debt ) from a Rating Agency of at least investment grade (BBB-/Baa3, or their respective equivalents for the time being), which rating NGET shall use all reasonable endeavours to obtain, provided that a Negative Rating Event shall not be deemed to have occurred in respect of a particular NGET Restructuring Event if the Rating Agency making the relevant reduction or declining to assign a rating of at least investment grade (as described above) does not announce or publicly confirm or otherwise inform the Trustee that the reduction or its declining to assign a rating of at least investment grade was the result, in whole or in part, of any event or circumstance comprised in or arising as a result of, or in respect of, the applicable NGET Restructuring Event; | |||
NGET Restructuring Event means the occurrence of any one or more of the following events: |
(a) | the Secretary of State for Trade and Industry or any official succeeding to his functions gives NGET written notice of revocation of the Electricity Transmission Licence in accordance with the terms as to revocation set out in Schedule 2 of the Electricity Transmission Licence, such revocation to become effective not later than the Maturity Date of the Instruments or NGET agrees in writing with the Secretary of State for Trade and Industry or any official succeeding to his functions to any revocation or surrender of the Electricity Transmission Licence or any legislation (whether primary or subordinate) is enacted terminating or revoking the Electricity Transmission Licence; or | ||
(b) | any modification is made to the terms and conditions of the Electricity Transmission Licence other than such a modification which the Trustee, in its opinion, considers to be not materially prejudicial to the interests of the Instrumentholders and has so confirmed in writing to NGET; or | ||
(c) | any legislation (whether primary or subordinate) is enacted removing, reducing or qualifying the duties or powers of the Secretary of State for Trade and Industry or any official succeeding to his functions and/or the Gas and Electricity Markets Authority under Section 3A of the Electricity Act as compared with those in effect on the issue date of the first Tranche of the Instruments other than such legislation which the Trustee, in its opinion, considers to be not materially prejudicial to the interests of the Instrumentholders and has so confirmed in writing to NGET; |
NGET Restructuring Period means: |
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(a) | if at the time at which the NGET Restructuring Event occurs there are Rated Securities, the period of 90 days starting from and including the day on which an NGET Restructuring Event occurs or such longer period in which the Rated Securities are under consideration (announced publicly within such 90 day period) for rating review by a Rating Agency; or | ||
(b) | if at the time at which an NGET Restructuring Event occurs there are no Rated Securities, the period starting from and including the day on which an NGET Restructuring Event occurs and ending on the day 90 days following the date on which a Negative Certification shall have been given to NGET in respect of that NGET Restructuring Event; |
Rated Securities means (a) the Instruments or (b) such other comparable unsecured and unsubordinated debt of NGET (or of any Subsidiary of NGET and which is guaranteed on an unsecured and unsubordinated basis by NGET) having an initial maturity of five years or more selected by NGET from time to time for the purpose of this definition with the approval of the Trustee and which possesses an investment grade rating (BBB-/Baa3, or their respective equivalents for the time being, or better) by any Rating Agency (whether at the invitation of NGET or by its own volition); | |||
Rating Agency means Standard & Poors Ratings Services, a division of The McGraw-Hill Companies, Inc., or any of its Subsidiaries and their successors or Moodys Investors Service, Inc., or any of its Subsidiaries and their successors or any rating agency substituted for either of them (or any permitted substitute of them) by NGET from time to time with the prior written approval of the Trustee; | |||
Rating Downgrade shall be deemed to have occurred in respect of an NGET Restructuring Event if the rating assigned to the Rated Securities by any Rating Agency which is current immediately prior to the occurrence of an NGET Restructuring Event (whether provided by a Rating Agency at the invitation of NGET or by its own volition) is withdrawn or reduced from an investment grade rating (BBB-/Baa3, or their respective equivalents for the time being, or better) to a non-investment grade rating (BB+/Ba1, or their respective equivalents for the time being, or worse) or, if the Rating Agency shall have already rated the Rated Securities below investment grade (as described above), the rating is lowered one full rating category (from BB+/Ba1 to BB/Ba2 or such similar lowering) provided that a Rating Downgrade shall not be deemed to have occurred in respect of or as a result of a particular NGET Restructuring Event if the Rating Agency making the relevant reduction in rating or declining to assign a rating of at least investment grade as provided in these Conditions does not announce or publicly confirm, or otherwise inform the Trustee, that the reduction or declining was the result, in whole or part, of any event or circumstance comprised in or arising as a result of, or in respect of, the applicable NGET Restructuring Event; | |||
Subsidiary means a subsidiary within the meaning of Section 1156 of the Companies Act 2006 and Subsidiaries shall be construed accordingly. | |||
5.6.3 | The Trustee shall not be responsible for ascertaining whether or not an NGET Restructuring Event, a Negative Rating Event or a Rating Downgrade in relation to NGET has occurred and, unless and until it has actual knowledge to the contrary, shall be entitled to assume that no such event has occurred. |
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5.6.4 | To exercise the option of redemption of an Instrument under Condition 5.6.1 the Instrumentholder must deliver each Instrument to be redeemed accompanied by a duly signed and completed notice of exercise in the form (for the time being current) obtainable from the specified office of any Paying Agent (a Put Notice ) and, in which the Instrumentholder may specify an account to which payment is to be made under this Condition 5.6 to the specified office of any Paying Agent on any business day falling within the period (the Put Period ) of 45 days after a Put Event Notice is given. The Instrument should be delivered together with all Receipts and Coupons (and Talons) appertaining thereto maturing after the date (the Put Date ) falling seven days after the expiry of the Put Period, failing which (unless Condition 6.5.2 applies) the Paying Agent will require payment of an amount equal to the face value of any such missing Receipt, Coupon and/or Talon. | ||
Any amount so paid will be reimbursed in the manner provided in Condition 6 against presentation and surrender of the relevant missing Receipt, Coupon and/or Talon, subject to Condition 8. The Paying Agent to which such Instrument and Put Notice are delivered will issue to the Instrumentholder concerned a non-transferable receipt in respect of the Instrument so delivered. | |||
Payment in respect of any Instrument so delivered will be made, if the Instrumentholder duly specified a bank account in the Put Notice to which payment is to be made, on the Put Date by transfer to that bank account and, in every other case, on or after the Put Date in the manner provided in Condition 6 against presentation and surrender (or, in the case of part payment, endorsement) of such receipt at the specified office of any Paying Agent. A Put Notice, once given, shall be irrevocable. For the purposes of the Conditions and the Trust Deed, receipts issued pursuant to this Condition 5.6 shall be treated as if they were Instruments. NGET shall redeem the relevant Instruments on the Put Date unless previously redeemed or purchased.] |
5.7 | Redemption at the Option of Instrumentholders | ||
If Put Option is specified in the relevant Final Terms, the Issuer shall, at the option of any Instrumentholder, upon such Instrumentholder giving not less than 15 nor more than 30 days notice to the Issuer (or such other notice period as may be specified on this Instrument) redeem such Instrument on the Optional Redemption Date(s) (as specified in the Final Terms) at its Optional Redemption Amount (as specified in the Final Terms) together with interest accrued to the date fixed for redemption. | |||
To exercise such option (which must be exercised on an Option Exercise Date) the holder must deposit such Instrument with any Paying Agent at its specified office, together with a duly completed option exercise notice ( Exercise Notice ) in the form obtainable from any Paying Agent within the Instrumentholders Option Period (as specified in the Final Terms). No Instrument so deposited and option exercised may be withdrawn (except as provided in the Agency Agreement) without the prior consent of the Issuer. | |||
5.8 | Partly Paid Instruments | ||
Partly Paid Instruments will be redeemed, whether at maturity, early redemption or otherwise, in accordance with the provisions of this Condition and the provisions specified in the relevant Final Terms. |
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5.9 | Redemption by Instalments | ||
Unless previously redeemed, purchased and cancelled as provided in this Condition 5, each Instrument which provides for Instalment Dates and Instalment Amounts will be partially redeemed on each Instalment Date at the Instalment Amount specified in the relevant Final Terms. The outstanding nominal amount of each such Instrument shall be reduced by the Instalment Amount (or, if such Instalment Amount is calculated by reference to a proportion of the nominal amount of such Instrument, such proportion) for all purposes with effect from the related Instalment Date, unless payment of the Instalment Amount is improperly withheld or refused on presentation of the related Receipt, in which case, such amount shall remain outstanding until the Relevant Date relating to such Instalment Amount. | |||
5.10 | Cancellation | ||
All Instruments redeemed pursuant to any of the foregoing provisions will be cancelled forthwith together with all unmatured Receipts and Coupons and unexchanged Talons attached thereto. All Instruments purchased by or on behalf of the Issuer or any of its Subsidiaries may, at the option of the Issuer be held by or may be surrendered together with all unmatured Receipts and Coupons and all unexchanged Talons attached to them to a Paying Agent for cancellation, but may not be resold and when held by the Issuer or any of its respective Subsidiaries shall not entitle the holder to vote at any meeting of Instrumentholders and shall not be deemed to be outstanding for the purposes of calculating quorums at meetings of Instrumentholders or for the purposes of Condition 11. |
6 | Payments and Talons |
6.1 | Payments | ||
Payments of principal and interest in respect of Instruments will, subject as mentioned below, be made against presentation and surrender of the relevant Receipts (in the case of payments of Instalment Amounts other than on the due date for redemption and provided that the Receipt is presented for payment together with its relative Instrument), Instruments (in the case of all other payments of principal and, in the case of interest, as specified in Condition 6.5.6) or Coupons (in the case of interest, save as specified in Condition 6.5.6), as the case may be, at the specified office of any Paying Agent outside the United States by a cheque payable in the currency in which such payment is due drawn on, or, at the option of the holder, by transfer to an account denominated in that currency with, a bank in the principal financial centre for that currency; provided that in the case of Euro, the transfer shall be in a city in which banks have access to the TARGET System. | |||
6.2 | Payments in the United States | ||
Notwithstanding the above, if any Instruments are denominated in U.S. dollars, payments in respect of them may be made at the specified office of any Paying Agent in New York City in the same manner as specified above if (a) the Issuer shall have appointed Paying Agents with specified offices outside the United States with the reasonable expectation that such Paying Agents would be able to make payment of the amounts on the Instruments in the manner provided above when due, (b) payment in full of such amounts at all such offices is illegal or effectively precluded by exchange controls or other similar restrictions on payment or receipt of such amounts and (c) such payment is then permitted by United States law, without involving, in the opinion of the Issuer, any adverse tax consequence to the Issuer. |
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6.3 | Payments subject to Fiscal Laws etc. | ||
All payments are subject in all cases to any applicable fiscal or other laws, regulations and directives, but without prejudice to the provisions of Condition 7. No commission or expenses shall be charged to the Instrumentholders or Couponholders in respect of such payments. | |||
6.4 | Appointment of Agents | ||
The Issuing and Paying Agent, the Paying Agents and the Calculation Agent initially appointed by the Issuer and their respective specified offices are listed below. The Issuing and Paying Agent, the Paying Agents and the Calculation Agent act solely as agents of the Issuer and do not assume any obligation or relationship of agency or trust for or with any holder. The Issuer reserves the right at any time with the approval of the Trustee to vary or terminate the appointment of the Issuing and Paying Agent, any other Paying Agent or the Calculation Agent and to appoint additional or other Paying Agents, provided that the Issuer shall at all times maintain (a) an Issuing and Paying Agent, (b) a Paying Agent having its specified office in a major European city, which shall be London so long as the Instruments are admitted to the Official List of the Financial Services Authority in its capacity as competent authority under the Financial Services and Markets Act 2000 and admitted to trading on the London Stock Exchanges Gilt Edged and Fixed Interest Market, (c) a Calculation Agent where the Conditions so require one, (d) so long as the Instruments are listed on any stock exchange or admitted to listing by any other relevant authority, a Paying Agent having a specified office in such place as may be required by the rules and regulations of any other relevant stock exchange or other relevant authority and (e) to the extent that the Issuer is able to do so and not provided for by the foregoing provisions of this Condition 6.4, a Paying Agent with a specified office in a European Union member state that will not be obliged to withhold or deduct tax pursuant to any law implementing European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of 26-27 November 2000. As used in these Conditions, the terms Issuing and Paying Agent , Calculation Agent , and Paying Agent include any additional or replacement Issuing and Paying Agent, Calculation Agent or Paying Agent appointed under this Condition. | |||
In addition, the Issuer shall forthwith appoint a Paying Agent in New York City in respect of any Instruments denominated in U.S. dollars in the circumstances described in Condition 6.2. | |||
Notice of any such change or any change of any specified office shall promptly be given to the Instrumentholders in accordance with Condition 14. | |||
6.5 | Unmatured Coupons and Receipts and unexchanged Talons |
6.5.1 | Unless the Instrument provides that the relevant Coupons are to become void upon the due date for redemption of those Instruments, Instruments should be surrendered for payment together with all unmatured Coupons (if any) appertaining to them, failing which an amount equal to the face value of each missing unmatured Coupon (or, in the case of payment not being made in full, that proportion of the amount of such missing unmatured Coupon that the sum of principal so paid bears to the total principal due) will be deducted from the Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount, as the case may be, due for payment. Any amount so deducted shall be paid in the manner mentioned above against surrender of such missing Coupon within a period of 10 years from the Relevant Date for the payment of such principal (whether or not such Coupon has become void pursuant to Condition 8). |
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6.5.2 | If the relevant Instrument so provides, upon the due date for redemption of any Instrument, unmatured Coupons relating to such Instrument (whether or not attached) shall become void and no payment shall be made in respect of them. | ||
6.5.3 | If the relevant Instrument so provides, upon the due date for redemption of any Instrument, any unexchanged Talon relating to such Instrument (whether or not attached) shall become void and no Coupon shall be delivered in respect of such Talon. | ||
6.5.4 | Upon the due date for redemption of any Instrument which is redeemable in instalments, all Receipts relating to such Instrument having an Instalment Date falling on or after such due date (whether or not attached) shall become void and no payment shall be made in respect of them. | ||
6.5.5 | Where any Instrument which provides that the relevant Coupons are to become void upon the due date for redemption of those Instruments is presented for redemption without all unmatured Coupons and any unexchanged Talon relating to it, and where any Instrument is presented for redemption without any unexchanged Talon relating to it, redemption shall be made only against the provision of such indemnity as the Issuer may require. | ||
6.5.6 | If the due date for redemption of any Instrument is not a due date for payment of interest, interest accrued from the preceding due date for payment of interest or the Interest Commencement Date, as the case may be, shall only be payable against presentation (and surrender if appropriate) of the relevant Instrument. Interest accrued on an Instrument that only bears interest after its Maturity Date shall be payable on redemption of that Instrument against presentation of that Instrument. |
6.6 | Non-business Days | ||
If any date for payment in respect of any Instrument, Receipt or Coupon is not a business day, the holder shall not be entitled to payment until the next following business day nor to any interest or other sum in respect of such postponed payment. In this paragraph, business day means a day (other than a Saturday or a Sunday) on which banks and foreign exchange markets are open for business in the relevant place of presentation, in such jurisdictions as shall be specified as Financial Centres in the relevant Final Terms and: |
6.6.1 | (in the case of a payment in a currency other than Euro) where payment is to be made by transfer to an account maintained with a bank in the relevant currency, on which foreign exchange transactions may be carried on in the relevant currency in the principal financial centre of the country of such currency; or | ||
6.6.2 | (in the case of a payment in Euro) which is a TARGET Business Day. |
6.7 | Talons | ||
On or after the Interest Payment Date for the final Coupon forming part of a Coupon sheet issued in respect of any Instrument, the Talon forming part of such Coupon sheet may be surrendered at the specified office of the Issuing and Paying Agent in exchange for a further Coupon sheet (but excluding any Coupons which may have become void pursuant to Condition 8). |
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7 | Taxation | |
All payments of principal and interest by or on behalf of the Issuer in respect of the Instruments, the Receipts and the Coupons will be made without withholding or deduction for or on account of, any present or future taxes or duties of whatever nature imposed or levied by or on behalf of the United Kingdom or any political sub-division of the United Kingdom or any authority in or of the United Kingdom having power to tax, unless such withholding or deduction is compelled by law. In that event, the Issuer will pay such additional amounts of principal and interest as will result in the payment to the Instrumentholders, Receiptholders or, as the case may be, the Couponholders of the amounts which would otherwise have been receivable in respect of the Instruments, Receipts or Coupons had no withholding or deduction been made, except that no such additional amounts shall be payable in respect of any Instrument, Receipt or Coupon presented for payment: |
(a) | by or on behalf of, a person who is liable to such taxes or duties in respect of such Instrument, Receipt or Coupon by reason of his having some connection with the United Kingdom other than the mere holding of such Instrument, Receipt or Coupon; or | ||
(b) | by or on behalf of a person who would not be liable or subject to such deduction or withholding by making a declaration of non-residence or other claim for exemption to a tax authority; or | ||
(c) | more than 30 days after the Relevant Date except to the extent that the holder would have been entitled to such additional amounts on presenting the same for payment on such 30th day; or | ||
(d) | where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to any law implementing European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of 26-27 November 2000; or | ||
(e) | by or on behalf of a holder who would have been able to avoid such withholding or deduction (i) by presenting the relevant Instrument, Receipt or Coupon to another Paying Agent in a Member State of the European Union; or (ii) by satisfying any statutory or procedural requirements (including, without limitation, the provision of information). |
As used in these Conditions, Relevant Date in respect of any Instrument, Receipt or Coupon means the date on which payment in respect of it first becomes due or (if any amount of the money payable is improperly withheld or refused) the date on which payment in full of the amount outstanding is made or (if earlier) the date on which notice is duly given to the Instrumentholders in accordance with Condition 14 that, upon further presentation of the Instrument, Receipt or Coupon being made in accordance with the Conditions, such payment will be made, provided that payment is in fact made upon such presentation. References in these Conditions to (a) principal shall be deemed to include any premium payable in respect of the Instruments, all Instalment Amounts, Final Redemption Amounts, Early Redemption Amounts, Optional Redemption Amounts, Amortised Face Amounts and all other amounts in the nature of principal payable pursuant to Condition 5 or any amendment or supplement to it, (b) interest shall be deemed to include all Interest Amounts and all other amounts payable pursuant to Condition 3 or any amendment or supplement to it and (c) principal and/or interest shall be deemed to include any additional amounts which may be payable under this Condition or any undertaking given in addition to or in substitution for it under the Trust Deed. |
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8 | Prescription | |
Instruments, Receipts and Coupons (which, for this purpose, shall not include Talons) shall be prescribed and become void unless presented for payment within 10 years (in the case of principal) or five years (in the case of interest) from the appropriate Relevant Date in respect of them. | ||
9 | Events of Default | |
If any of the following events (each an Event of Default ) occurs and is continuing, the Trustee at its discretion may, and if so requested by the holders of at least one-quarter in nominal amount of the Instruments then outstanding or if so directed by an Extraordinary Resolution shall, give notice to the Issuer at its registered office that the Instruments are, and they shall accordingly immediately become due and repayable at their Redemption Amount together with accrued interest (if any) to the date of payment: |
(a) | Non-Payment: there is default for more than 30 days in the payment of any principal or interest due in respect of the Instruments; or | ||
(b) | Breach of Other Obligations: there is default in the performance or observance by the Issuer of any other obligation or provision under the Trust Deed or the Instruments (other than any obligation for the payment of any principal or interest in respect of the Instruments) which default is incapable of remedy or, if in the opinion of the Trustee capable of remedy, is not remedied within 90 days after notice of such default shall have been given to the Issuer by the Trustee; or | ||
(c) | Cross-Acceleration: if (i) any other present or future Relevant Indebtedness of the Issuer [(or a Principal Subsidiary)] * becomes due and payable prior to its stated maturity by reason of any actual event of default or (ii) any amount in respect of such Relevant Indebtedness is not paid when due or, as the case may be, within any applicable grace period, provided that the aggregate amount of the Relevant Indebtedness in respect of which one or more of the events mentioned above in this paragraph (c) have occurred equals or exceeds £50,000,000, for the period up to 31 March 2017, and thereafter, £100,000,000. | ||
[For the purposes of this Condition 9, Principal Subsidiary means National Grid Gas plc, NGET and National Grid USA, and includes any successor entity thereto or any member of the group of companies comprising National Grid and each of its subsidiary undertakings (the National Grid Group ) which the Auditors have certified to the Trustee as being a company to which all or substantially all of the assets of a Principal Subsidiary are transferred. In the event that all or substantially all of the assets of a Principal Subsidiary are transferred to a member of the National Grid Group as described above, the transferor of such assets shall cease to be deemed to be a Principal Subsidiary for the purposes of this Condition.]*; or | |||
(d) | Winding-up: a resolution is passed, or a final order of a court in the United Kingdom is made and, where possible, not discharged or stayed within a period of 90 days, that the Issuer be wound up or dissolved; or | ||
(e) | Enforcement Proceedings: attachment is made of the whole or substantially the whole of the assets or undertakings of the Issuer and such attachment is not released or cancelled within 90 days or an encumbrancer takes possession or an administrative or other receiver or similar officer is appointed of the whole or substantially the whole of the assets or undertaking |
* | Only applicable where National Grid is the Issuer. |
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(f) | Insolvency: the Issuer ceases to carry on all or substantially all of its business or is unable to pay its debts within the meaning of Section 123(1)(e) or Section 123(2) of the Insolvency Act 1986; or | ||
(g) | Bankruptcy: the Issuer is adjudged bankrupt or insolvent by a court of competent jurisdiction in its country of incorporation, | ||
provided that in the case of paragraph (b) the Trustee shall have certified that in its opinion such event is materially prejudicial to the interests of the Instrumentholders. |
10 | Enforcement | |
The Trustee may, at its discretion and without further notice, institute such proceedings against the Issuer as it may think fit to enforce any obligation, condition or provision binding on the Issuer under the Instruments or under the Trust Deed, but shall not be bound to do so unless: |
(a) | it has been so directed by an Extraordinary Resolution or in writing by the holders of at least one-quarter of the principal amount of the Instruments outstanding; and | ||
(b) | it has been indemnified to its satisfaction. |
No Instrumentholder, Receiptholder or Couponholder shall be entitled to institute proceedings directly against the Issuer unless the Trustee, having become bound to proceed as specified above, fails to do so within a reasonable time and such failure is continuing. |
11 | Meetings of Instrumentholders, Modifications and Substitution |
11.1 | Meetings of Instrumentholders | ||
The Trust Deed contains provisions for convening meetings of Instrumentholders to consider any matter affecting their interests, including the sanctioning by Extraordinary Resolution (as defined in the Trust Deed) of a modification of any of these Conditions or any provisions of the Trust Deed. An Extraordinary Resolution duly passed at any such meeting shall be binding on Instrumentholders (whether or not they were present at the meeting at which such resolution was passed) and on all Couponholders, except that any Extraordinary Resolution proposed, inter alia , (a) to amend the dates of maturity or redemption of the Instruments, any Instalment Date or any date for payment of interest on the Instruments, (b) to reduce or cancel the nominal amount of, or any Instalment Amount of, or any premium payable on redemption of, the Instruments, (c) to reduce the rate or rates of interest in respect of the Instruments or to vary the method or basis of calculating the rate or rates or amount of interest or the basis for calculating any Interest Amount in respect of the Instruments, (d) if a Minimum and/or a Maximum Rate of Interest is shown on the face of the Instrument, to reduce any such Minimum and/or Maximum Rate of Interest, (e) to vary any method of calculating the Final Redemption Amount, the Early Redemption Amount or the Optional Redemption Amount, (f) to take any steps that as specified in this Instrument may only be taken following approval by an Extraordinary Resolution to which the special quorum provisions apply, and (g) to modify the provisions concerning the quorum required at any meeting of Instrumentholders or the majority required to pass the Extraordinary Resolution will only be binding if passed at a meeting of the Instrumentholders (or at any adjournment of |
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that meeting) at which a special quorum (as defined in the Trust Deed) is present. A resolution in writing signed by the holders of not less than 95 per cent. in nominal amount of the Instruments will be binding on all Instrumentholders and Couponholders. The Issuer may convene a meeting of Instrumentholders jointly with the holders of all other instruments issued pursuant to the Agency Agreement and not forming a single series with the Instruments to which meeting the provisions referred to above apply as if all such instruments formed part of the same series, provided that the proposals to be considered at such meeting affect the rights of the holders of the instruments of each series attending the meeting in identical respects (save insofar as the Conditions applicable to each such series are not identical). | |||
11.2 | Modification of the Trust Deed | ||
The Trustee may agree, without the consent of the Instrumentholders or Couponholders, to (a) any modification of any of the provisions of the Trust Deed that is of a formal, minor or technical nature or is made to correct a manifest error, and (b) any other modification (except as mentioned in the Trust Deed), and any waiver or authorisation of any breach or proposed breach, of any of the provisions of the Trust Deed that is in the opinion of the Trustee not materially prejudicial to the interests of the Instrumentholders. Any such modification, authorisation or waiver shall be binding on the Instrumentholders and the Couponholders and, if the Trustee so requires, such modification shall be notified to the Instrumentholders as soon as practicable. | |||
11.3 | Substitution | ||
The Trust Deed contains provisions permitting the Trustee to agree, subject to such amendment of the Trust Deed and such other conditions as the Trustee may require, but without the consent of the Instrumentholders or the Couponholders, to the substitution of any other company in place of the Issuer or of any previous substituted company, as principal debtor under the Trust Deed and the Instruments. In the case of such a substitution the Trustee may agree, without the consent of the Instrumentholders or the Couponholders, to a change of the law governing the Instruments, the Receipts, the Coupons, the Talons and/or the Trust Deed provided that such change would not in the opinion of the Trustee be materially prejudicial to the interests of the Instrumentholders. | |||
11.4 | Entitlement of the Trustee | ||
In connection with the exercise of its functions (including but not limited to those referred to in this Condition) the Trustee shall have regard to the interests of the Instrumentholders as a class and shall not have regard to the consequences of such exercise for individual Instrumentholders or Couponholders and the Trustee shall not be entitled to require, nor shall any Instrumentholder or Couponholder be entitled to claim, from the Issuer any indemnification or payment in respect of any tax consequence of any such exercise upon individual Instrumentholders or Couponholders. |
12 | Replacement of Instruments, Receipts, Coupons and Talons | |
If an Instrument, Receipt, Coupon or Talon is lost, stolen, mutilated, defaced or destroyed, it may be replaced, subject to applicable laws, listing authority and stock exchange regulations, at the specified office of such other Paying Agent as may from time to time be designated by the Issuer for the purpose and notice of whose designation is given to Instrumentholders in accordance with |
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Condition 14 on payment by the claimant of the fees and costs incurred in connection with that replacement and on such terms as to evidence, security and indemnity (which may provide, inter alia , that if the allegedly lost, stolen or destroyed Instrument, Receipt, Coupon or Talon is subsequently presented for payment or, as the case may be, for exchange for further Coupons, there shall be paid to the Issuer on demand the amount payable by the Issuer in respect of such Instruments, Receipts, Coupons or further Coupons) and otherwise as the Issuer may require. Mutilated or defaced Instruments, Receipts, Coupons or Talons must be surrendered before replacements will be issued. | ||
13 | Further Issues | |
The Issuer may from time to time without the consent of the Instrumentholders or Couponholders create and issue further instruments having the same terms and conditions as the Instruments and so that such further issue shall be consolidated and form a single series with such Instruments. | ||
References in these Conditions to the Instruments include (unless the context requires otherwise) any other instruments issued pursuant to this Condition and forming a single series with the Instruments. Any such further instruments forming a single series with Instruments constituted by the Trust Deed or any deed supplemental to it shall, and any other instruments may (with the consent of the Trustee), be constituted by the Trust Deed. | ||
The Trust Deed contains provisions for convening a single meeting of the Instrumentholders and the holders of instruments of other series if the Trustee so decides. | ||
14 | Notices | |
All notices to the Instrumentholders will be valid if published in a daily English language newspaper of general circulation in the United Kingdom (which is expected to be the Financial Times ). If in the opinion of the Trustee any such publication is not practicable, notice shall be validly given if published in another leading daily English language newspaper with general circulation in Europe. Any such notice shall be deemed to have been given on the date of such publication or, if published more than once or on different dates, on the first date on which publication is made, as provided above. | ||
Couponholders shall be deemed for all purposes to have notice of the contents of any notice given to the holders of Instruments in accordance with this Condition. | ||
15 | Indemnification of Trustee | |
The Trust Deed contains provisions for the indemnification of the Trustee and for its relief from responsibility, including but not limited to provisions relieving it from any obligation to (a) appoint an independent financial adviser and (b) take proceedings to enforce repayment unless indemnified to its satisfaction. The Trustee is entitled to enter into business transactions with the Issuer or any of its subsidiary undertakings, parent undertakings, joint ventures or associated undertakings without accounting for any profit resulting from these transactions and to act as trustee for the holders of any other securities issued by the Issuer or any of its subsidiary undertakings, parent undertakings, joint ventures or associated undertakings. | ||
16 | Contracts (Rights of Third Parties) Act 1999 | |
No person shall have any right to enforce any term or condition of the Instruments under the Contracts (Rights of Third Parties) Act 1999. |
96
17 | Governing Law and Jurisdiction |
17.1 | The Instruments and any non-contractual obligations arising out of or connected with them are governed by, and shall be construed in accordance with, English law. | ||
17.2 | The courts of England have exclusive jurisdiction to settle any dispute (a Dispute ), arising from or connected with the Instruments. | ||
17.3 | The Issuer agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary. | ||
17.4 | Nothing in this Condition 17 prevents the Trustee or any Instrumentholder from taking proceedings relating to a Dispute ( Proceedings ) in any other courts with jurisdiction. To the extent allowed by law, the Trustee or Instrumentholders may take concurrent Proceedings in any number of jurisdictions. |
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[Cp. No.]
|
[Denomination] | [ISIN] | [Series] | [Certif. No.] |
* | Delete as applicable. | |
** | [Only necessary where Interest Payment Dates are subject to adjustment in accordance with a Business Day Convention, otherwise the particular Interest Payment Date should be specified.] | |
*** | [Only required for Coupons relating to Floating Rate or Index Linked Interest Instruments that are issued in more than one denomination.] | |
**** | [Delete if Coupons are not to become void upon early redemption of Instrument.] |
98
99
[Talon No.]
|
[ISIN] | [Series] | [Certif. No.] |
* | Delete as applicable. | |
** | [The maturity dates of the relevant Coupons should be set out if known, otherwise reference should be made to the months and years in which the Interest Payment Dates fall.] | |
*** | [Only when required were the Series comprises Instruments of more than one denomination.] | |
**** | [Delete if Talon is not to become void upon early redemption of the Instrument.] |
100
101
* | Delete as applicable. |
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1 | In this Schedule: | |
1.1 | references to a meeting are to a meeting of Instrumentholders of a single Series of Instruments issued by the relevant Issuer and include, unless the context otherwise requires, any adjournment; | |
1.2 | references to Instruments and Instrumentholders are only to the Instruments of the Series in respect of which a meeting has been, or is to be, called, and to the holders of these Instruments, respectively; | |
1.3 | agent means a holder of a voting certificate or a proxy for, or representative of, an Instrumentholder; | |
1.4 | block voting instruction means an instruction issued in accordance with paragraphs 8 to 14; | |
1.5 | Extraordinary Resolution means a resolution passed at a meeting duly convened and held in accordance with this Trust Deed by a majority of at least 75 per cent of the votes cast; | |
1.6 | voting certificate means a certificate issued in accordance with paragraphs 5, 6, 7 and 14; and | |
1.7 | references to persons representing a proportion of the Instruments are to Instrumentholders or agents holding or representing in the aggregate at least that proportion in nominal amount of the Instruments for the time being outstanding. |
2 | A meeting shall, subject to the Conditions and without prejudice to any powers conferred on other persons by this Trust Deed, have power by Extraordinary Resolution: |
2.1 | to sanction any proposal by the relevant Issuer or the Trustee for any modification, abrogation, variation or compromise of, or arrangement in respect of, the rights of the Instrumentholders and/or the Couponholders against such Issuer whether or not those rights arise under this Trust Deed; |
2.2 | to sanction the exchange or substitution for the Instruments of, or the conversion of the Instruments into, shares, bonds or other obligations or securities of the relevant Issuer or any other entity; |
2.3 | to assent to any modification of this Trust Deed, the Instruments, the Receipts, the Talons or the Coupons proposed by the relevant Issuer or the Trustee; |
2.4 | to authorise anyone to concur in and do anything necessary to carry out and give effect to an Extraordinary Resolution; |
2.5 | to give any authority, direction or sanction required to be given by Extraordinary Resolution; |
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2.6 | to appoint any persons (whether Instrumentholders or not) as a committee or committees to represent the Instrumentholders interests and to confer on them any powers or discretions which the Instrumentholders could themselves exercise by Extraordinary Resolution; |
2.7 | to approve a proposed new Trustee and to remove a Trustee; |
2.8 | to approve the substitution of any entity for the relevant Issuer (or any previous substitute) as principal debtor under this Trust Deed; and |
2.9 | to discharge or exonerate the Trustee from any liability in respect of any act or omission for which it may become responsible under this Trust Deed, the Instruments, the Receipts, the Talons or the Coupons, | |
provided that the special quorum provisions in paragraph 19 shall apply to any Extraordinary Resolution (a special quorum resolution ) for the purpose of sub-paragraph 2.2 or 2.7, any of the proposals listed in Condition 11.1 or any amendment to this proviso. |
3 | The relevant Issuer or the Trustee may at any time convene a meeting. If it receives a written request by Instrumentholders holding at least 10 per cent in nominal amount of the Instruments of any Series for the time being outstanding and is indemnified to its satisfaction against all costs and expenses, the Trustee shall convene a meeting of the Instrumentholders of that Series. Every meeting shall be held at a time and place approved by the Trustee. |
4 | At least 21 days notice (exclusive of the day on which the notice is given and of the day of the meeting) shall be given to the Instrumentholders. A copy of the notice shall be given by the party convening the meeting to the other parties. The notice shall specify the day, time and place of meeting and, unless the Trustee otherwise agrees, the nature of the resolutions to be proposed and shall explain how Instrumentholders may appoint proxies or representatives, obtain voting certificates and use block voting instructions and the details of the time limits applicable. |
5 | If a holder of an Instrument wishes to obtain a voting certificate in respect of it for a meeting, he must deposit it for that purpose at least 48 hours before the time fixed for the meeting with a Paying Agent or to the order of a Paying Agent with a bank or other depositary nominated by the Paying Agent for the purpose. The Paying Agent shall then issue a voting certificate in respect of it. |
6 | A voting certificate shall: | |
6.1 | be a document in the English language; | |
6.2 | be dated; | |
6.3 | specify the meeting concerned and the serial numbers of the Instruments deposited; and | |
6.4 | entitle, and state that it entitles, its bearer to attend and vote at that meeting in respect of those Instruments. |
104
7 | Once a Paying Agent has issued a voting certificate for a meeting in respect of an Instrument, it shall not release the Instrument until either: |
7.1 | the meeting has been concluded; or |
7.2 | the voting certificate has been surrendered to the Paying Agent. |
8 | If a holder of an Instrument wishes the votes attributable to it to be included in a block voting instruction for a meeting, then, at least 48 hours before the time fixed for the meeting, (i) he must deposit the Instrument for that purpose with a Paying Agent or to the order of a Paying Agent with a bank or other depositary nominated by the Paying Agent for the purpose and (ii) he or a duly authorised person on his behalf must direct the Paying Agent how those votes are to be cast. The Paying Agent shall issue a block voting instruction in respect of the votes attributable to all Instruments so deposited. |
9 | A block voting instruction shall: | |
9.1 | be a document in the English language; | |
9.2 | be dated; | |
9.3 | specify the meeting concerned; |
9.4 | list the total number and serial numbers of the Instruments deposited, distinguishing with regard to each resolution between those voting for and those voting against it; | |
9.5 | certify that such list is in accordance with Instruments deposited and directions received as provided in paragraphs 8, 11 and 14; and | |
9.6 | appoint a named person (a proxy ) to vote at that meeting in respect of those Instruments and in accordance with that list. | |
A proxy need not be an Instrumentholder. |
10 | Once a Paying Agent has issued a block voting instruction for a meeting in respect of the votes attributable to any Instruments: |
10.1 | it shall not release the Instruments, except as provided in paragraph 11, until the meeting has been concluded; and |
10.2 | the directions to which it gives effect may not be revoked or altered during the 48 hours before the time fixed for the meeting. |
11 | If the receipt for an Instrument deposited with a Paying Agent in accordance with paragraph 8 is surrendered to the Paying Agent at least 48 hours before the time fixed for the meeting, the Paying Agent shall release the Instrument and exclude the votes attributable to it from the block voting instruction. |
12 | Each block voting instruction shall be deposited at least 24 hours before the time fixed for the meeting at such place as the Trustee shall designate or approve, and in default it shall not be valid unless the chairman of the meeting decides otherwise before the meeting proceeds to business. If the Trustee requires, a notarially certified copy of each block voting instruction shall be produced by the proxy at the meeting but the Trustee need not investigate or be concerned with the validity of the proxys appointment. |
13 | A vote cast in accordance with a block voting instruction shall be valid even if it or any of the Instrumentholders instructions pursuant to which it was executed has previously been |
105
revoked or amended, unless written intimation of such revocation or amendment is received from the relevant Paying Agent by the relevant Issuer or the Trustee at its registered office or by the chairman of the meeting in each case at least 24 hours before the time fixed for the meeting. |
14 | No Instrument may be deposited with or to the order of a Paying Agent at the same time for the purposes of both paragraph 5 and paragraph 8 for the same meeting. |
15 | The chairman of a meeting shall be such person as the Trustee may nominate in writing, but if no such nomination is made or if the person nominated is not present within 15 minutes after the time fixed for the meeting the Instrumentholders or agents present shall choose one of their number to be chairman, failing which the relevant Issuer may appoint a chairman. The chairman need not be an Instrumentholder or agent. The chairman of an adjourned meeting need not be the same person as the chairman of the original meeting. |
16 | The following may attend and speak at a meeting: | |
16.1 | Instrumentholders and agents; | |
16.2 | the chairman; |
16.3 | the relevant Issuer and the Trustee (through their respective representatives) and their respective financial and legal advisers; and | |
16.4 | the Dealers and their advisers. | |
No one else may attend or speak. |
17 | No business (except choosing a chairman) shall be transacted at a meeting unless a quorum is present at the commencement of business. If a quorum is not present within 15 minutes from the time initially fixed for the meeting, it shall, if convened on the requisition of Instrumentholders or if the relevant Issuer and the Trustee agree, be dissolved. In any other case it shall be adjourned until such date, not less than 14 nor more than 42 days later, and time and place as the chairman may decide. If a quorum is not present within 15 minutes from the time fixed for a meeting so adjourned, the meeting shall be dissolved. |
18 | Two or more Instrumentholders or agents present in person shall be a quorum: |
18.1 | in the cases marked No minimum proportion in the table below, whatever the proportion of the Instruments which they represent; and |
106
18.2 | in any other case, only if they represent the proportion of the Instruments shown by the table below. |
Column 1 | Column 2 | Column 3 | ||
Purpose of meeting
|
Any meeting except one referred to in column 3 | Meeting previously adjourned through want of a quorum | ||
Required proportion | Required proportion | |||
|
||||
To pass a special quorum resolution
|
Two thirds | One third | ||
|
||||
To pass any other Extraordinary
Resolution
|
A clear majority | No minimum proportion | ||
|
||||
Any other purpose
|
10 per cent | No minimum proportion |
19 | The chairman, may with the consent of (and shall if directed by) a meeting, adjourn the meeting from time to time and from place to place. Only business which could have been transacted at the original meeting may be transacted at a meeting adjourned in accordance with this paragraph or paragraph 18. |
20 | At least 10 days notice of a meeting adjourned through want of a quorum shall be given in the same manner as for an original meeting and that notice shall state the quorum required at the adjourned meeting. However, no notice need otherwise be given of an adjourned meeting. |
21 | Each question submitted to a meeting shall be decided by a show of hands unless a poll is (before, or on the declaration of the result of, the show of hands) demanded by the chairman, the relevant Issuer, the Trustee or one or more persons holding one or more Instruments or voting certificates or representing 2 per cent of the Instruments. |
22 | Unless a poll is demanded a declaration by the chairman that a resolution has or has not been passed shall be conclusive evidence of the fact without proof of the number or proportion of the votes cast in favour of or against it. |
23 | If a poll is demanded, it shall be taken in such manner and (subject as provided below) either at once or after such adjournment as the chairman directs. The result of the poll shall be deemed to be the resolution of the meeting at which it was demanded as at the date it was taken. A demand for a poll shall not prevent the meeting continuing for the transaction of business other than the question on which it has been demanded. |
24 | A poll demanded on the election of a chairman or on a question of adjournment shall be taken at once. |
25 | On a show of hands every person who is present in person and who produces an Instrument or a voting certificate or is a proxy or representative has one vote. On a poll every such person has one vote in respect of each integral currency unit of the Specified Currency of such Series of Instruments so produced or represented by the voting certificate so produced or for which he is a proxy or representative. Without prejudice to |
107
the obligations of proxies, a person entitled to more than one vote need not use them all or cast them all in the same way. |
26 | In case of equality of votes the chairman shall both on a show of hands and on a poll have a casting vote in addition to any other votes which he may have. |
27 | An Extraordinary Resolution shall be binding on all the Instrumentholders, whether or not present at the meeting, and on all the Couponholders and each of them shall be bound to give effect to it accordingly. The passing of such a resolution shall be conclusive evidence that the circumstances justify its being passed. The relevant Issuer shall give notice of the passing of an Extraordinary Resolution to Instrumentholders within 14 days but failure to do so shall not invalidate the resolution. |
28 | A resolution in writing signed by or on behalf of the holders of not less than 95 per cent in nominal amount of the Instruments who for the time being are entitled to receive notice of a meeting in accordance with the provisions of this Schedule shall for all purposes be as valid and effectual as an Extraordinary Resolution passed at a meeting of such Instrumentholders duly convened and held in accordance with the provisions of this Schedule. Such resolution in writing may be contained in one document or several documents in similar form each signed by or on behalf of one or more of the Instrumentholders. |
29 | Minutes shall be made of all resolutions and proceedings at every meeting and, if purporting to be signed by the chairman of that meeting or of the next succeeding meeting, shall be conclusive evidence of the matters in them. Until the contrary is proved every meeting for which minutes have been so made and signed shall be deemed to have been duly convened and held and all resolutions passed or proceedings transacted at it to have been duly passed and transacted. |
30 | Subject to all other provisions in this Trust Deed the Trustee may without the consent of the Instrumentholders prescribe such further regulations regarding the holding of meetings and attendance and voting at them as it in its sole discretion determines including (without limitation) such requirements as the Trustee thinks reasonable to satisfy itself that the persons who purport to make any requisition in accordance with this Trust Deed are entitled to do so and as to the form of voting certificates or block voting instructions so as to satisfy itself that persons who purport to attend or vote at a meeting are entitled to do so. |
31 | The holder of a Global Instrument shall (unless such Global Instrument represents only one Instrument) be treated as two persons for the purposes of any quorum requirements of a meeting of Instrumentholders. |
32 | The above provisions of this Schedule shall have effect subject to the following provisions: |
32.1 | Meetings of Instrumentholders of separate Series will normally be held separately. However, the Trustee may from time to time determine that meetings of Instrumentholders of separate Series shall be held together. |
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32.2 | A resolution that in the opinion of the Trustee affects one Series alone shall be deemed to have been duly passed if passed at a separate meeting of the Instrumentholders of the Series concerned. |
32.3 | A resolution that in the opinion of the Trustee affects the Instrumentholders of more than one Series but does not give rise to a conflict of interest between the Instrumentholders of the different Series concerned shall be deemed to have been duly passed if passed at a single meeting of the Instrumentholders of the relevant Series provided that for the purposes of determining the votes an Instrumentholder is entitled to cast pursuant to paragraph 26, each Instrumentholder shall have one vote in respect of each whole Euro 1.00 nominal amount of Instruments held, converted, if such Instruments are not denominated in Euro, in accordance with Clause 8.13 ( Currency Conversion ). |
32.4 | A resolution that in the opinion of the Trustee affects the Instrumentholders of more than one Series and gives or may give rise to a conflict of interest between the Instrumentholders of the different Series concerned shall be deemed to have been duly passed only if it shall be duly passed at separate meetings of the Instrumentholders of the relevant Series. |
32.5 | To all such meetings as previously set out all the preceding provisions of this Schedule shall mutatis mutandis apply as though references therein to Instruments and to Instrumentholders were references to the Instruments and Instrumentholders of the Series concerned. |
109
EXECUTED BY AFFIXING
THE COMMON SEAL of NATIONAL GRID plc |
ü
ý þ |
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in the presence of:
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DAVID CHARLES FORWARD | |||
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EXECUTED BY AFFIXING
THE COMMON SEAL of NATIONAL GRID ELECTRICITY TRANSMISSION plc |
ü
ý þ |
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in the presence of:
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HARRIET HILL | |||
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EXECUTED AS A DEED BY AFFIXING
THE COMMON SEAL of THE LAW DEBENTURE TRUST CORPORATION p.l.c. |
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ý þ |
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in the presence of:
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RICHARD RANCE
CAROL MORRIS |
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Contents | Page | |||
1 Interpretation
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1 | |||
2 Issue of Instruments and Covenant to Pay
|
6 | |||
3 Form of the Instruments
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8 | |||
4 Stamp Duties and Taxes
|
9 | |||
4A Guarantee and Indemnity
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10 | |||
5 Application of Moneys Received by the Trustee
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12 | |||
6 Covenants
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13 | |||
7 Remuneration and Indemnification of the Trustee
|
15 | |||
8 Provisions Supplemental to the Trustee Acts
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17 | |||
9 Trustee Liable for Negligence
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20 | |||
10 Waiver and Proof of Default
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21 | |||
11 Trustee not Precluded from Entering into Contracts
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21 | |||
12 Modification and Substitution
|
21 | |||
13 Appointment, Retirement and Removal of The Trustee
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23 | |||
14 Instruments Held in Clearing Systems and Couponholders
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24 | |||
15 Currency Indemnity
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25 | |||
16 Enforcement
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26 | |||
17 Communications
|
27 | |||
18 Governing Law and Jurisdiction
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27 | |||
Schedule 1 Part A Form of CGN Temporary Global Instrument
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28 | |||
Schedule 1 Part B Form of CGN Permanent Global Instrument
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35 | |||
Schedule 1 Part C Form of NGN Temporary Global Instrument
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45 | |||
Schedule 1 Part D Form of NGN Permanent Global Instrument
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51 | |||
Schedule 2 Part A Form of Definitive Instrument
|
59 | |||
Schedule 2 Part B Terms and Conditions of the Instruments
|
63 |
i
Contents | Page | |||
Schedule 2 Part C Form of Coupon
|
92 | |||
Schedule 2 Part D Form of Talon
|
94 | |||
Schedule 2 Part E Form of Receipt
|
96 | |||
Schedule 3 Provisions for Meetings of Instrumentholders
|
97 |
ii
(1) | NATIONAL GRID GAS plc ( National Grid Gas ) and NATIONAL GRID GAS FINANCE (NO 1) plc ( National Grid Gas Finance (No 1) ), each an Issuer and together, the Issuers ); | |
(2) | NATIONAL GRID GAS plc as guarantor in respect of Instruments issued by National Grid Gas Finance (No 1) (the Guarantor ); and | |
(3) | THE LAW DEBENTURE TRUST CORPORATION p.l.c. (the Trustee , which expression, where the meaning so admits, includes any other trustee for the time being of this Trust Deed). |
(A) | The Issuers propose to issue from time to time bearer debt instruments (the Instruments ) in an aggregate nominal amount outstanding at any one time, including Instruments previously issued under the Programme, not exceeding the Programme Limit in accordance with the Dealer Agreement (the Programme ) and to be constituted under this Trust Deed. | |
(B) | The Trustee has agreed to act as trustee of this Trust Deed on the following terms and conditions. | |
(C) | For the purposes of the Programme National Grid Gas, National Grid Gas Finance (No 1) and the Trustee entered into an amended and restated trust deed dated 24 February 2010 (the Prior Trust Deed ). |
1 | Interpretation | |
1.1 | Definitions | |
In this Trust Deed: | ||
Agency Agreement means the amended and restated agency agreement (as amended, supplemented and/or restated from time to time) relating to the Programme dated 18 February 2011 between the Issuers, the Guarantor, the Trustee, The Bank of New York Mellon as Issuing and Paying Agent and the other agents mentioned in it. | ||
Agents has the meaning given to it in the Agency Agreement. | ||
Calculation Agent means any person named as such in the Conditions or any Successor Calculation Agent. | ||
CGN means a temporary Global Instrument in the form set out in Part A of Schedule 1 or a permanent Global Instrument in the form set out in Part B of Schedule 1. | ||
Clearstream, Luxembourg means Clearstream Banking, société anonyme . | ||
Common Safekeeper means, in relation to a Series, the common safekeeper for Euroclear and Clearstream, Luxembourg appointed in respect of such Instruments. | ||
Conditions means in respect of the Instruments of each Series the terms and conditions applicable to them which shall be substantially in the form set out in Part B of Schedule 2 ( Terms and Conditions of the Instruments ) as modified, with respect to any Instruments |
1
represented by a Global Instrument, by the provisions of such Global Instrument, and shall incorporate any additional provisions forming part of such terms and conditions set out in Part A of the Final Terms relating to the Instruments of that Series and shall be endorsed on the Definitive Instruments subject to amendment and completion as referred to in the first paragraph of Part A of Schedule 2 ( Form of Definitive Instrument ) and any reference to a particularly numbered Condition shall be construed accordingly. | ||
Contractual Currency means, in relation to any payment obligation of any Instrument, the currency in which that payment obligation is expressed and, in relation to Clause 7 ( Remuneration and Indemnification of the Trustee ), pounds sterling or such other currency as may be agreed between the Issuers, the Guarantor and the Trustee from time to time. | ||
Coupons means the coupons relating to interest bearing Instruments or, as the context may require, a specific number of them and includes any replacement Coupons issued pursuant to the Conditions. | ||
Dealer Agreement means the amended and restated dealer agreement (as amended, supplemented and/or restated from time to time) relating to the Programme dated 18 February 2011 between the Issuers, the Guarantor, the Arranger, and the dealers named in it. | ||
Definitive Instrument means an Instrument in definitive form having, where appropriate, Coupons, Receipt(s) and/or a Talon attached on issue and, unless the context requires otherwise, includes any replacement Instrument issued pursuant to the Conditions. | ||
Euroclear means Euroclear Bank S.A./N.V. | ||
Event of Default means an event described in Condition 9 and that, if so required by that Condition, has been certified by the Trustee to be, in its opinion, materially prejudicial to the interests of the Instrumentholders. | ||
Extraordinary Resolution has the meaning set out in Schedule 3 ( Provisions for Meetings of Instrumentholders ). | ||
Final Terms means, in relation to a Tranche, the final terms document substantially in the form set out in the Prospectus which will be completed at or around the time of the agreement to issue each Tranche of Instruments and which will constitute final terms for the purposes of Article 5.4 of the Prospectus Directive. | ||
Global Instrument means a temporary Global Instrument and/or, as the context may require, a permanent Global Instrument, a CGN or a NGN, as the context may require. | ||
Guarantee means the guarantee and indemnity of the Guarantor in Clause 4A. | ||
holder in relation to an Instrument, Receipt, Coupon or Talon, and Couponholder and Instrumentholder have the meanings given to them in the Conditions. | ||
Instruments means the bearer debt instruments to be issued by each of the Issuers pursuant to the Dealer Agreement, constituted by this Trust Deed and for the time being outstanding or, as the context may require, a specific number of them. | ||
Issuing and Paying Agent means the person named as such in the Conditions or any Successor Issuing and Paying Agent in each case at its specified office. | ||
month means a calendar month. |
2
NGN means a temporary Global Instrument in the form set out in Part C of Schedule 1 or a permanent Global Instrument in the form set out in Part D of Schedule 1. | ||
outstanding means, in relation to the Instruments, all the Instruments issued except (a) those that have been redeemed in accordance with the Conditions, (b) those in respect of which the date for redemption has occurred and the redemption moneys (including all interest accrued on such Instruments to the date for such redemption and any interest payable after such date) have been duly paid to the Trustee or to the Issuing and Paying Agent as provided in Clause 2 ( Issue of Instruments and Covenant to Pay ) and remain available for payment against presentation and surrender of Instruments, Receipts and/or Coupons, as the case may be, (c) those which have become void or in respect of which claims have become prescribed, (d) those which have been purchased and cancelled as provided in the Conditions, (e) those mutilated or defaced Instruments which have been surrendered in exchange for replacement Instruments, (f) (for the purpose only of determining how many Instruments are outstanding and without prejudice to their status for any other purpose) those Instruments alleged to have been lost, stolen or destroyed and in respect of which replacement Instruments have been issued, and (g) any temporary Global Instrument to the extent that it shall have been exchanged for a permanent Global Instrument and any Global Instrument to the extent that it shall have been exchanged for one or more Definitive Instruments, in either case pursuant to its provisions provided that for the purposes of (i) ascertaining the right to attend and vote at any meeting of the Instrumentholders, (ii) the determination of how many Instruments are outstanding for the purposes of Conditions 9 and 11 and Schedule 3 ( Provisions for Meetings of Instrumentholders ), (iii) the exercise of any discretion, power or authority that the Trustee is required, expressly or impliedly, to exercise in or by reference to the interests of the Instrumentholders and (iv) the certification (where relevant) by the Trustee as to whether a Potential Event of Default is in its opinion materially prejudicial to the interests of the Instrumentholders, those Instruments which are beneficially held by or on behalf of the relevant Issuer, the Guarantor (if applicable) or any of its respective subsidiary undertakings and not cancelled shall (unless no longer so held) be deemed not to remain outstanding. Save for the purposes of the proviso herein, in the case of each NGN, the Trustee shall rely on the records of Euroclear and Clearstream, Luxembourg in relation to any determination of the nominal amount outstanding of each NGN. | ||
Paying Agents means the persons (including the Issuing and Paying Agent) referred to as such in the Conditions or any Successor Paying Agents in each case at their respective specified offices. | ||
permanent Global Instrument means a Global Instrument representing Instruments of one or more Tranches of the same Series, either on issue or upon exchange of a temporary Global Instrument, or part of it, and which shall be substantially in the form set out in Part B or Part D of Schedule 1, as the case may be ( Form of Permanent Global Instrument ). | ||
Potential Event of Default means an event or circumstance that could with the giving of notice, lapse of time, issue of a certificate and/or fulfilment of any other requirement provided for in Condition 9 become an Event of Default. | ||
Programme Limit means the maximum aggregate nominal amount of Instruments which may be issued and outstanding at any time under the Programme, as such limit may be increased pursuant to the Dealer Agreement. |
3
Prospectus means the prospectus prepared in connection with the Programme and constituting a base prospectus in respect of each Issuer for the purposes of Article 5.4 of the Prospectus Directive, as revised, supplemented or amended from time to time by the Issuers and the Guarantor (if applicable) including any documents which are from time to time incorporated in the Prospectus by reference except that in relation to each Tranche of Instruments only the applicable Final Terms shall be deemed to be included in the Prospectus. | ||
Prospectus Directive means Directive 2003/71/EC of the European Parliament and of the Council. | ||
Receipts means the receipts for the payment of instalments of principal in respect of Instruments of which the principal is repayable in instalments or, as the context may require, a specific number of them and includes any replacement Receipts issued pursuant to the Conditions. | ||
Redemption Amount means the Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount, as the case may be, all as defined in the Conditions. | ||
Series means a series of Instruments comprising one or more Tranches, whether or not issued on the same date, that (except in respect of the first payment of interest and their issue price) have identical terms on issue and are expressed to have the same series number. | ||
specified office means, in relation to a Paying Agent, the office identified with its name at the end of the Conditions or any other office approved by the Trustee and notified to Instrumentholders pursuant to Clause 6.6 ( Notices to Instrumentholders ). | ||
Successor means, in relation to an Agent such other or further person as may from time to time be appointed by any of the Issuers or the Guarantor (if applicable) as such Agent with the written approval of, and on terms approved in writing by, the Trustee and notice of whose appointment is given to Instrumentholders pursuant to Clause 6.6 ( Notices to Instrumentholders ). | ||
Successor in Business means (a) an entity which acquires all or substantially all of the undertaking and/or assets of the relevant Issuer or the Guarantor or of a Successor in Business of such Issuer or the Guarantor; or (b) any entity into which any of the previously referred to entity is amalgamated, merged or reconstructed and is itself not the continuing company. | ||
Talons mean talons for further Coupons or, as the context may require, a specific number of them and includes any replacement Talons issued pursuant to the Conditions. | ||
TARGET System means the Trans-European Automated Real-Time Gross Settlement Express Transfer (known as TARGET2) System which was launched on 19 November 2007 or any successor thereto. | ||
temporary Global Instrument means a Global Instrument representing Instruments of one or more Tranches of the same Series on issue and which shall be substantially in the form set out in Part A or Part C of Schedule 1, as the case may be ( Form of Temporary Global Instrument ). | ||
Tranche means, in relation to a Series, those Instruments of that Series which are issued on the same date at the same issue price and in respect of which the first payment of interest is identical. |
4
trust corporation means a trust corporation (as defined in the Law of Property Act 1925) or a corporation entitled to act as a trustee pursuant to applicable foreign legislation relating to trustees. | ||
Trustee Acts means both the Trustee Act 1925 and the Trustee Act 2000 of England and Wales. | ||
1.2 | Construction of Certain References | |
Unless the context otherwise requires all references in this Trust Deed to: |
1.2.1 | the records of Euroclear and Clearstream, Luxembourg shall be to the records that each of Euroclear and Clearstream, Luxembourg holds for its customers which reflect the amount of such customers interests in the Instruments; | ||
1.2.2 | costs, charges, remuneration or expenses include any value added, turnover or similar tax charged in respect of them; | ||
1.2.3 | an action, remedy or method of judicial proceedings for the enforcement of creditors rights include references to the action, remedy or method of judicial proceedings in jurisdictions other than England as shall most nearly approximate to it; | ||
1.2.4 | the Trustees approval or consent shall, unless expressed otherwise, be subject to the requirement that any such approval or consent shall not be unreasonably withheld or delayed, such reasonableness to be determined by reference to acting in the interests of Instrumentholders as a whole; and | ||
1.2.5 | the appointment or employment of or delegation to any person by the Trustee shall be deemed to include a reference to, if in the opinion of the Trustee it is reasonably practicable, the prior notification of and consultation with the Issuers and the Guarantor and, in any event, the notification forthwith of such appointment, employment or delegation, as the case may be. |
1.3 | Headings | |
Headings shall be ignored in construing this Trust Deed. | ||
1.4 | Contracts | |
References in this Trust Deed to this Trust Deed or any other document are to this Trust Deed or those documents as amended, supplemented or replaced from time to time in relation to the Programme and include any document that amends, supplements or replaces them. | ||
1.5 | Schedules | |
The Schedules are part of this Trust Deed and have effect accordingly. | ||
1.6 | Alternative Clearing System | |
References in this Trust Deed to Euroclear and/or Clearstream, Luxembourg shall, wherever the context so permits, be deemed to include reference to any additional or alternative clearing system approved by the relevant Issuer and the Guarantor (if |
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applicable), the Trustee and the Issuing and Paying Agent. In the case of NGNs, such alternative clearing system must also be authorised to hold Instruments as eligible collateral for Eurosystem monetary policy and intra-day credit operations. | ||
1.7 | Other terms | |
Other terms defined in the Dealer Agreement or the Conditions have the same meaning in this Trust Deed. | ||
1.8 | Contracts (Rights of Third Parties) Act 1999 | |
A person who is not a party to this Trust Deed has no right under the Contracts (Rights of Third Parties) Act 1999 to enforce any term of this Trust Deed. | ||
1.9 | Amendment and Restatement | |
The Prior Trust Deed shall be amended and restated on the terms of this Trust Deed, such amendment and restatement to take effect from the date of this Trust Deed. Any Instruments issued on or after the date of this Trust Deed shall be constituted by, and issued pursuant to, this Trust Deed. This does not affect any Instruments issued prior to the date of this Trust Deed or any other Instrument issued on or after the date of this Trust Deed to be consolidated and form a single series with the Instruments of any series issued prior to the date of this Trust Deed. Subject to such amendment and restatement, the Prior Trust Deed shall continue in full force and effect. | ||
2 | Issue of Instruments and Covenant to Pay | |
2.1 | Issue of Instruments | |
Each of the Issuers may from time to time issue Instruments in Tranches of one or more Series on a continuous basis with no minimum issue size in accordance with the Dealer Agreement. Before issuing any Tranche and not later than 3.00 p.m. (London time) on the second business day in London which for this purpose shall be a day on which commercial banks are open for general business in London preceding each proposed issue date, the relevant Issuer shall give written notice or procure that it is given to the Trustee of the proposed issue of such Tranche, specifying the details to be included in the relevant Final Terms. Upon the issue by any of the Issuers of any Instruments expressed to be constituted by this Trust Deed, such Instruments shall forthwith be constituted by this Trust Deed without any further formality and irrespective of whether or not the issue of such debt securities contravenes any covenant or other restriction in this Trust Deed or the Programme Limit. | ||
2.2 | Separate Series | |
The provisions of Clauses 2.3 ( Covenant to Pay ), 2.4 ( Discharge ), 2.5 ( Payment after a Default ) and 2.6 ( Rate of Interest after a Default ) and of Clauses 3 ( Form of the Instruments ) to 15 ( Currency Indemnity ) and Schedule 3 ( Provisions for Meetings of Instrumentholders ) (all inclusive) shall apply mutatis mutandis separately and independently to the Instruments of each Series and in such Clauses and Schedule the expressions Instrumentholders , Receipts , Coupons , Couponholders and |
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Talons , together with all other terms that relate to Instruments or their Conditions, shall be construed as referring to those of the particular Series in question and not of all Series unless expressly so provided, so that each Series shall be constituted by a separate trust pursuant to Clause 2.3 ( Covenant to Pay ) and that, unless expressly provided, events affecting one Series shall not affect any other. | ||
2.3 | Covenant to Pay | |
The relevant Issuer shall on any date when any Instruments become due to be redeemed, in whole or in part, unconditionally pay to or to the order of the Trustee in the Contractual Currency, in the case of any Contractual Currency other than euro, in the principal financial centre for the Contractual Currency and, in the case of euro, in a city in which banks have access to the TARGET System, in same day funds the Redemption Amount of the Instruments becoming due for redemption on that date together with any applicable premium and shall (subject to the Conditions and other than in respect of the Zero Coupon Instruments) until such payment (both before and after judgment) unconditionally so pay to or to the order of the Trustee interest in respect of the nominal amount of the Instruments outstanding as set out in the Conditions (subject to Clause 2.6 ( Rate of Interest after a Default )) provided that (a) payment of any sum due in respect of the Instruments made to the Issuing and Paying Agent as provided in the Agency Agreement shall, to that extent, satisfy such obligation except to the extent that there is failure in its subsequent payment to the relevant Instrumentholders or Couponholders under the Conditions and (b) a payment made after the due date or as a result of the Instrument becoming repayable following an Event of Default shall be deemed to have been made when the full amount due has been received by the Issuing and Paying Agent or the Trustee and notice to that effect has been given to the Instrumentholders (if required under Clause 6.8 ( Notice of Late Payment )), except to the extent that there is failure in its subsequent payment to the relevant Instrumentholders or Couponholders under the Conditions. This covenant shall only have effect each time Instruments are issued and outstanding, when the Trustee shall hold the benefit of this covenant on trust for the Instrumentholders and Couponholders of the relevant Series. | ||
2.4 | Discharge | |
Subject to Clause 2.5 ( Payment after a Default ), any payment to be made in respect of the Instruments, Receipts or the Coupons by the relevant Issuer, the Guarantor or the Trustee may be made as provided in the Conditions and any payment so made shall (subject to Clause 2.5 ( Payment after a Default )) to that extent be a good discharge to such Issuer, the Guarantor or the Trustee, as the case may be (including, in the case of Instruments represented by a NGN, whether or not the corresponding entries have been made in the records of Euroclear and Clearstream, Luxembourg), except to the extent that there is failure in its subsequent payment to the relevant Instrumentholders or Couponholders under the Conditions. | ||
2.5 | Payment after a Default | |
At any time after an Event of Default or a Potential Event of Default has occurred the Trustee may: |
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2.5.1 | by notice in writing to the relevant Issuer, the Guarantor (if applicable) and the Paying Agents, require the Paying Agents, until notified by the Trustee to the contrary, so far as permitted by applicable law: |
(i) | to act as Paying Agents of the Trustee under this Trust Deed and the Instruments on the terms of the Agency Agreement (with consequential amendments as necessary and except that the Trustees liability for the indemnification, remuneration and expenses of the Paying Agents shall be limited to the amounts for the time being held by the Trustee in respect of the Instruments on the terms of this Trust Deed) and thereafter to hold all Instruments, Receipts, Coupons and Talons and all moneys, documents and records held by them in respect of Instruments, Receipts, Coupons and Talons to the order of the Trustee; or | ||
(ii) | to deliver all Instruments, Receipts, Coupons and Talons and all moneys, documents and records held by them in respect of the Instruments, Receipts, Coupons and Talons to the Trustee or as the Trustee directs in such notice and, |
2.5.2 | by notice in writing to the relevant Issuer and the Guarantor (if applicable), require such Issuer failing whom, the Guarantor (if applicable) to make all subsequent payments in respect of the Instruments, Receipts, Coupons and Talons to or to the order of the Trustee and not to the Issuing and Paying Agent and with effect from the receipt of any such notice by such Issuer and the Guarantor (if applicable), until such notice is withdrawn, the first proviso to Clause 2.3 ( Covenant to Pay ) shall cease to have effect. |
2.6 | Rate of Interest after a Default | |
If the Instruments bear interest at a floating or other variable rate and they become immediately payable under the Conditions following an Event of Default, the rate of interest payable in respect of them shall continue to be calculated by the Calculation Agent in accordance with the Conditions (with consequential amendments as necessary) except that the rates of interest need not be notified to Instrumentholders. The first period in respect of which interest shall be so calculable shall commence on the expiry of the Interest Period during which the Instruments become so repayable. | ||
3 | Form of the Instruments | |
3.1 | The Global Instruments | |
The Instruments shall initially be represented by a temporary Global Instrument or a permanent Global Instrument in the nominal amount of the Tranche being issued. Interests in temporary Global Instruments shall be exchangeable for Definitive Instruments or interests in permanent Global Instruments as set out in each temporary Global Instrument. Interests in permanent Global Instruments shall be exchangeable for Definitive Instruments as set out in each permanent Global Instrument. |
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3.2 | The Definitive Instruments | |
The Definitive Instruments, Receipts, Coupons and Talons shall be security printed in accordance with applicable legal and stock exchange requirements substantially in the forms set out in Schedule 2. The Instruments shall be endorsed with the Conditions. | ||
3.3 | Signature | |
The Instruments, Receipts, Coupons and Talons shall be signed manually or in facsimile by an authorised signatory of the relevant Issuer and the Instruments shall be authenticated by or on behalf of the Issuing and Paying Agent. The relevant Issuer may use the facsimile signature of any person who at the date of this Trust Deed is such an authorised signatory even if at the time of issue of any Instruments, Receipts, Coupons or Talons he no longer holds that office. In the case of a Global Instrument which is a NGN, the Issuing and Paying Agent shall also instruct the Common Safekeeper to effectuate the same. Instruments, Receipts, Coupons and Talons so executed and authenticated (and effectuated, if applicable) shall be binding and valid obligations of the relevant Issuer. Execution in facsimile of any Instruments and any photostatic copying or other duplication of any Global Instruments (in unauthenticated form, but executed manually on behalf of the relevant Issuer as stated above) shall be binding upon such Issuer in the same manner as if such Instruments were signed manually by such signatories. | ||
3.4 | Title | |
The holder of any Instrument, Receipt, Coupon or Talon shall (save as otherwise required by law) be treated as its absolute owner for all purposes (whether or not it is overdue and regardless of any notice of ownership, trust or any interest in it, any writing on it or its theft or loss) and no person will be liable for so treating the holder. | ||
4 | Stamp Duties and Taxes | |
4.1 | Stamp Duties | |
Each of the Issuers shall pay any stamp, issue, documentary or other taxes and duties payable in the United Kingdom in respect of the creation, issue and offering of the Instruments, Receipts, Coupons and Talons by it and the execution or delivery by it of this Trust Deed. Each Issuer shall also indemnify the Trustee, the Instrumentholders and the Couponholders from and against all stamp, issue, documentary or other taxes paid by any of them in any jurisdiction in connection with any action taken by or on behalf of the Trustee or, as the case may be (where entitled to do so), the Instrumentholders or the Couponholders to enforce the relevant Issuers or (if applicable) the Guarantors obligations under this Trust Deed or the Instruments, Receipts, Coupons or Talons. | ||
4.2 | Change of Taxing Jurisdiction | |
If an Issuer or the Guarantor becomes subject generally to the taxing jurisdiction of a territory or a taxing authority of or in that territory with power to tax other than or in addition to the United Kingdom or any such authority of or in such territory then such Issuer or, as the case may be, the Guarantor shall (unless the Trustee otherwise agrees) give the Trustee an undertaking satisfactory to the Trustee in terms corresponding to the terms of |
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Condition 7 with the substitution for, or (as the case may require) the addition to, the references in that Condition to the United Kingdom of references to that other or additional territory or authority to whose taxing jurisdiction such Issuer or the Guarantor has become so subject. In such event this Trust Deed and the Instruments, Receipts, Coupons and Talons shall be read accordingly. | ||
4A | Guarantee and Indemnity | |
4A.1 Guarantee | ||
The Guarantor unconditionally and irrevocably guarantees that if National Grid Gas Finance (No 1) does not pay any sum payable by it under this Trust Deed, the Instruments, the Receipts or the Coupons by the time and on the date specified for such payment (whether on the normal due date, on acceleration or otherwise), the Guarantor shall pay that sum to or to the order of the Trustee, in the manner provided in Clause 2.3 ( Covenant to Pay ) (or if in respect of sums due under Clause 7 ( Remuneration and Indemnification of the Trustee ), in pounds sterling (or such other currency as may be agreed between the Issuers, the Guarantor and the Trustee from time to time) in London in immediately available funds) before close of business on that date in the city to which payment is so to be made. Clauses 2.3(a) and 2.3(b) shall apply (with consequential amendments as necessary) to such payments other than those in respect of sums due under Clause 7 ( Remuneration and Indemnification of the Trustee ). All payments under the Guarantee by the Guarantor shall be made subject to Condition 6 and Clause 4.2 ( Change of Taxing Jurisdiction ). | ||
4A.2 Guarantor as Principal Debtor | ||
As between the Guarantor and the Trustee, the Instrumentholders and the Couponholders but without affecting National Grid Gas Finance (No 1)s obligations, the Guarantor shall be liable under this Clause as if it were the sole principal debtor and not merely a surety. Accordingly, it shall not be discharged, nor shall its liability be affected, by anything that would not discharge it or affect its liability if it were the sole principal debtor (including (1) any time, indulgence, waiver or consent at any time given to National Grid Gas Finance (No 1) or any other person, (2) any amendment to any other provisions of this Trust Deed or to the Conditions or to any security or other guarantee or indemnity, (3) the making or absence of any demand on National Grid Gas Finance (No 1) or any other person for payment, (4) the enforcement or absence of enforcement of this Trust Deed, the Instruments, the Receipts or the Coupons or of any security or other guarantee or indemnity, (5) the taking, existence or release of any security, guarantee or indemnity, (6) the dissolution, amalgamation, reconstruction or reorganisation of National Grid Gas Finance (No 1) or any other person or (7) the illegality, invalidity or unenforceability of or any defect in any provision of this Trust Deed, the Instruments, the Receipts or the Coupons or any of National Grid Gas Finance (No 1)s obligations under any of them). | ||
4A.3 Guarantors Obligations Continuing | ||
The Guarantors obligations under this Trust Deed are and shall remain in full force and effect by way of continuing security until no sum remains payable under this Trust Deed, the Instruments, the Receipts or the Coupons. Furthermore, those obligations of the Guarantor are additional to, and not instead of, any security or other guarantee or |
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4A.4.1 | any right of the Guarantor, by reason of the performance of any of its obligations under this Clause, to be indemnified by National Grid Gas Finance (No 1) or to take the benefit of or to enforce any security or other guarantee or indemnity shall be exercised and enforced by the Guarantor only in such manner and on such terms as the Trustee may require or approve and | ||
4A.4.2 | any amount received or recovered by the Guarantor (a) as a result of any exercise of any such right or (b) in the liquidation, dissolution, amalgamation, reconstruction, reorganisation, insolvency, winding-up or analogous proceedings relating to National Grid Gas Finance (No 1) shall be held in trust for the Trustee and immediately paid to the Trustee and the Trustee shall hold it on the trusts set out in Clause 5.1 ( Declaration of Trust ). |
4A.5 Suspense Accounts | ||
Any amount received or recovered by the Trustee (otherwise than as a result of a payment by National Grid Gas Finance (No 1) to the Trustee in accordance with Clause 2 ( Issue of Instruments and Covenant to Pay )) in respect of any sum payable by National Grid Gas Finance (No 1) under this Trust Deed, the Instruments, the Receipts or the Coupons may be placed in a suspense account and kept there for so long as the Trustee thinks fit. | ||
4A.6 Avoidance of Payments | ||
The Guarantor shall within 5 business days of demand indemnify the Trustee, each Instrumentholder and each Couponholder against any cost, loss, expense or liability sustained or incurred by it as a result of it being required for any reason (including any bankruptcy, insolvency, winding-up, dissolution, or similar law of any jurisdiction) to refund all or part of any amount received or recovered by it in respect of any sum payable by National Grid Gas Finance (No 1) under this Trust Deed, any Instrument or the Receipts or Coupons relating to that Instrument and shall in any event pay to it on demand the amount as refunded by it. | ||
4A.7 Debts of National Grid Gas Finance (No 1) | ||
If any moneys become payable by the Guarantor under this Guarantee, National Grid Gas Finance (No 1) shall not (except in the event of the liquidation of National Grid Gas Finance (No 1)) so long as any such moneys remain unpaid, pay any moneys for the time being due from National Grid Gas Finance (No 1) to the Guarantor. | ||
4A.8 Indemnity | ||
As separate, independent and alternative stipulations, the Guarantor unconditionally and irrevocably agrees (1) that any sum that, although expressed to be payable by National |
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Grid Gas Finance (No 1) under this Trust Deed, the Instruments or the Receipts or Coupons, is for any reason (whether or not now existing and whether or not now known or becoming known to National Grid Gas Finance (No 1), the Guarantor, the Trustee or any Instrumentholder or Couponholder) not recoverable from the Guarantor on the basis of a guarantee shall nevertheless be recoverable from it as if it were the sole principal debtor and shall be paid by it to the Trustee within 5 business days of demand and (2) as a primary obligation to indemnify the Trustee, each Instrumentholder and each Couponholder against any loss suffered by it as a result of any sum expressed to be payable by National Grid Gas Finance (No 1) under this Trust Deed, the Instruments or the Receipts or Coupons not being paid on the date and otherwise in the manner specified in this Trust Deed or any payment obligation of National Grid Gas Finance (No 1) under this Trust Deed, the Instruments, the Receipts or the Coupons being or becoming void, voidable or unenforceable for any reason (whether or not now existing and whether or not now known or becoming known to the Trustee, any Instrumentholder or any Couponholder), the amount of that loss being the amount expressed to be payable by National Grid Gas Finance (No 1) in respect of the relevant sum. | ||
5 | Application of Moneys Received by the Trustee | |
5.1 | Declaration of Trust | |
All moneys received by the Trustee in respect of the Instruments or amounts payable under this Trust Deed shall, despite any appropriation of all or part of them by the relevant Issuer or the Guarantor (if applicable), be held by the Trustee on trust to apply them (subject to Clause 5.2 ( Accumulation )): |
5.1.1 | first, in payment of all costs, charges, expenses and liabilities reasonably incurred by the Trustee (including remuneration payable to it) in carrying out its functions under this Trust Deed; | ||
5.1.2 | secondly, in payment of any amounts owing in respect of the Instruments, Receipts or Coupons pari passu and rateably; and | ||
5.1.3 | thirdly, in payment of any balance to such Issuer for itself or, if any moneys were received from the Guarantor and to the extent of such moneys, the Guarantor. |
If the Trustee holds any moneys which represent principal, premium or interest in respect of Instruments, Receipts or Coupons which have become void in accordance with the Conditions, the Trustee shall hold them on these trusts. | ||
5.2 | Accumulation | |
If the amount of the moneys at any time available for payment in respect of the Instruments under Clause 5.1 ( Declaration of Trust ) is less than 10 per cent. of the nominal amount of the Instruments then outstanding, the Trustee may, at its discretion, invest such moneys as provided in Clause 5.3 ( Investment ). The Trustee may retain such investments and accumulate the resulting income until the investments and the accumulations, together with any other funds for the time being under its control and available for such payment, amount to at least 10 per cent. of the nominal amount of the Instruments then outstanding and then such investments, accumulations and funds (after deduction of, or provision for, any applicable taxes) shall be applied as specified in Clause 5.1 ( Declaration of Trust ). |
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5.3 | Investment | |
Moneys held by the Trustee may be invested in its name or under its control in any investments or other assets anywhere, whether or not they produce income, or deposited in its name or under its control at such bank or other financial institution in such currency as the Trustee may, in its absolute discretion, think fit. If that bank or institution is the Trustee or a subsidiary, parent or associated undertaking of the Trustee, it need only account for an amount of interest equal to the largest amount of interest payable by it on such a deposit to an independent customer. The Trustee may at any time vary or transpose any such investments or assets or convert any moneys so deposited into any other currency, and shall not be responsible for any resulting loss, whether by depreciation in value, change in exchange rates or otherwise. | ||
6 | Covenants | |
So long as any Instrument is outstanding, each of the Issuers (in respect of itself only) and the Guarantor shall each: | ||
6.1 | Books of Account | |
Keep, and procure that each of its subsidiary undertakings keeps, proper books of account and, at any time after an Event of Default has occurred or if the Trustee reasonably believes that such an event has occurred, so far as permitted by applicable law, allow, and procure that each such subsidiary undertaking shall allow, the Trustee and anyone appointed by it to whom the relevant Issuer, the Guarantor (if applicable) and/or the relevant subsidiary undertaking has no reasonable objection, access to its books of account at all reasonable times during normal business hours. | ||
6.2 | Notice of Events of Default | |
Notify the Trustee in writing immediately on becoming aware of the occurrence of any Event of Default or Potential Event of Default. | ||
6.3 | Information | |
So far as permitted by applicable law, give the Trustee such information as it reasonably requires to perform its functions. | ||
6.4 | Financial Statements etc | |
Send to the Trustee at the time of their issue and in the case of annual financial statements in any event within 180 days of the end of each financial year three copies in English of every balance sheet, profit and loss account, report or other notice, statement or circular issued, or that legally or contractually should be issued, to the members or creditors (or any class of them) of the relevant Issuer, the Guarantor (if applicable) or any parent undertaking of it generally in their capacity as such. | ||
6.5 | Certificate of Directors | |
Send to the Trustee, within 14 days of its annual audited financial statements being made available to its members, and also within 21 days of any request by the Trustee a |
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certificate of the relevant Issuer or, as the case may be, the Guarantor signed by a Director or the Company Secretary that, having made all reasonable enquiries, to the best of the knowledge, information and belief of such Issuer or, as the case may be, the Guarantor as at a date (the Certification Date ) not more than five days before the date of the certificate no Event of Default or Potential Event of Default had occurred (and in the case of a Potential Event of Default was continuing) since the Certification Date of the last such certificate or (if none) the date of this Trust Deed or, if such an event had occurred (and in the case of a Potential Event of Default was continuing), giving details of it and certifying that it has complied with its obligations under this Trust Deed or, to the extent that it has failed so to comply, stating such. | ||
6.6 | Notices to Instrumentholders | |
Obtain the prior written approval of the Trustee to, and promptly give to the Trustee two copies of, the form of every notice given to the Instrumentholders in accordance with Condition 14 (such approval, unless so expressed, not to constitute approval for the purposes of Section 21 of the Financial Services and Markets Act 2000 any such notice which is a communication within the meaning of that section). | ||
6.7 | Further Acts | |
So far as permitted by applicable law, do such further things as may be necessary in the reasonable opinion of the Trustee to give effect to this Trust Deed. | ||
6.8 | Notice of Late Payment | |
Forthwith upon request by the Trustee (if the Trustee determines such notice is necessary) give notice to the Instrumentholders of any unconditional payment to the Issuing and Paying Agent or the Trustee of any sum due in respect of the Instruments, the Receipts or Coupons made after the due date for such payment. | ||
6.9 | Listing | |
If the Instruments are so listed, use all reasonable endeavours to maintain the listing of the Instruments but, if it is unable to do so, having used such endeavours, or if the maintenance of such listing is agreed by the Trustee to be unduly onerous and the Trustee is satisfied that the interests of the Instrumentholders would not by such action be materially prejudiced, instead use all reasonable endeavours to obtain and maintain a listing of the Instruments on another stock exchange approved in writing by the Trustee and subject to the requirements of the Dealer Agreement. | ||
6.10 | Change in Agents | |
Give at least 14 days prior notice to the Instrumentholders in accordance with the Conditions of any future appointment, resignation or removal of an Agent or of any change by an Agent of its specified office. | ||
6.11 | Provision of Legal Opinions | |
Procure the delivery of legal opinions addressed to the Trustee dated the date of such delivery, in form and content acceptable to the Trustee: |
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6.11.1 | from Clifford Chance LLP (or such other firm of legal advisers as may be agreed between the relevant Issuer, the Guarantor (if applicable) and the Trustee) as to the laws of England before the first issue of Instruments occurring after each anniversary of this Trust Deed or, if later, 12 months after the date of delivery of the latest such legal opinion and on the date of any amendment to this Trust Deed; | ||
6.11.2 | unless the relevant Issuer has notified the Dealers and the Trustee in writing that it does not intend to issue Instruments under the Programme for the time being, from legal advisers, reasonably acceptable to the Trustee as to such law as may reasonably be requested by the Trustee and in such form and with such content as the Trustee may require, on such occasions as the Trustee so requests on the basis that the Trustee considers it prudent in view of a change (or proposed change) in (or in the interpretation or application of) any applicable law, regulation or circumstance materially affecting the relevant Issuer, the Guarantor (if applicable), the Trustee, the Instruments, the Certificates, the Receipts, the Coupons, the Talons, this Trust Deed or the Agency Agreement; and | ||
6.11.3 | on each occasion on which a legal opinion is given to any Dealer pursuant to the Dealer Agreement from the legal adviser giving such opinion. |
6.12 | Instruments Held by an Issuer or Guarantor etc. | |
Send to the Trustee as soon as practicable after being so requested by the Trustee a certificate of the relevant Issuer or, as the case may be, the Guarantor signed by any Director or the Company Secretary stating the number of Instruments held at the date of such certificate by or on behalf of such Issuer or, as the case may be, the Guarantor or their respective subsidiary undertakings. | ||
6.13 | Obligations of Agents | |
Comply with and perform all its obligations under the Agency Agreement and use all reasonable endeavours to procure that the Agents comply with and perform all their respective obligations thereunder and not make any amendment or modification to the Agency Agreement without the prior written approval of the Trustee. | ||
6.14 | Copies of Dealer Agreement | |
Provide the Trustee promptly with copies of all supplements and/or amendments to, and/or restatements of, the Dealer Agreement. | ||
7 | Remuneration and Indemnification of the Trustee | |
7.1 | Normal Remuneration | |
So long as any Instrument is outstanding each of the Issuers (failing whom, the Guarantor, in the case of Instruments issued by National Grid Gas Finance (No 1)) shall pay the Trustee as remuneration for its services as Trustee such sum on such dates in each case as they may from time to time agree. Such remuneration shall accrue from day to day from the date of this Trust Deed. However, if any payment to an Instrumentholder or Couponholder of moneys due in respect of any Instrument, Receipts or Coupon is improperly withheld or refused, such remuneration shall again accrue as from the date of |
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such withholding or refusal until payment to such Instrumentholder or Couponholder is duly made. | ||
7.2 | Extra Remuneration | |
If an Event of Default shall have occurred or if the Trustee finds it expedient or necessary or is requested by an Issuer to undertake duties that they both agree to be of an exceptional nature or otherwise outside the scope of the Trustees normal duties under this Trust Deed, such Issuer (failing whom, the Guarantor, in the case of Instruments issued by National Grid Gas Finance (No 1)) shall pay such additional remuneration as they may agree or, failing agreement as to any of the matters in this Clause 7 (or as to such sums referred to in Clause 7.1 ( Normal Remuneration )), as determined by an investment bank (acting as an expert) selected by the Trustee and approved by such Issuer or, failing such approval, nominated by the President for the time being of The Law Society of England and Wales. The expenses involved in such nomination and such investment banks fee shall be shared equally between the Trustee and the relevant Issuer. The determination of such investment bank shall be conclusive and binding on the relevant Issuer, the Guarantor, the Trustee, the Instrumentholders and the Couponholders. | ||
7.3 | Expenses | |
Each of the Issuers, in respect of Instruments issued by it, (failing whom, the Guarantor, in the case of Instruments issued by National Grid Gas Finance (No 1)) shall also on demand by the Trustee pay or discharge all costs, charges, liabilities and expenses reasonably incurred by the Trustee in the preparation and execution of this Trust Deed and the performance of its functions under this Trust Deed including, but not limited to, legal and travelling expenses and any United Kingdom stamp, documentary or other taxes or duties paid by the Trustee in connection with any legal proceedings reasonably brought or contemplated by the Trustee against an Issuer or the Guarantor to enforce any provision of this Trust Deed, the Instruments, the Receipts, the Coupons or the Talons and in addition shall pay to the Trustee (if required) an amount equal to the amount of any value added tax or similar tax chargeable in respect of the Trustees remuneration under this Trust Deed. Such costs, charges, liabilities and expenses shall: |
7.3.1 | in the case of payments made by the Trustee before such demand, carry interest from the date of the demand at the rate of one per cent. per annum over the base rate of The Royal Bank of Scotland plc on the date on which the Trustee made such payments; and | ||
7.3.2 | in other cases, carry interest at such rate from 30 days after the date of the demand or (where the demand specifies that payment is to be made on an earlier date) from such earlier date provided that in such event no such interest shall accrue unless payment is actually made on such earlier date. |
7.4 | Notice of Costs | |
The Trustee shall wherever practicable give prior notice to the Issuers and the Guarantor of any costs, charges and expenses properly to be incurred and of payments to be made by the Trustee in the lawful exercise of its powers under this Trust Deed so as to afford each of the Issuers and the Guarantor a reasonable opportunity to meet such costs, charges and expenses itself or to put the Trustee in funds to make payment of such costs, |
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charges and expenses. However, failure of the Trustee to give any such prior notice shall not prejudice its rights to reimbursement of such costs, charges and expenses under this Clause 7. | ||
7.5 | Indemnity | |
Each of the Issuers (failing whom, the Guarantor, in the case of Instruments issued by National Grid Gas Finance (No 1)) shall indemnify the Trustee in respect of all liabilities and expenses reasonably incurred by it or by anyone appointed by it or to whom any of its functions may be delegated by it in the carrying out of its functions and against any loss, liability, cost, claim, action, demand or expense (including, but not limited to, all reasonable costs, charges and expenses paid or incurred in disputing or defending any of the foregoing) which any of them may incur or that may be made against any of them arising out of or in relation to or in connection with, its appointment or the exercise of its functions. | ||
7.6 | Continuing Effect | |
Clauses 7.3 ( Expenses ) and 7.5 ( Indemnity ) shall continue in full force and effect as regards the Trustee even if it no longer is Trustee. | ||
7.7 | Determination of Series | |
The Trustee shall be entitled in its absolute discretion to determine in respect of which Series of Instruments any costs, charge, liabilities and expenses incurred under this Trust Deed have been incurred or to allocate any such costs, charges, liabilities and expenses between the Instruments of any two or more Series. | ||
8 | Provisions Supplemental to the Trustee Acts | |
8.1 | Advice | |
The Trustee may act on the opinion or advice of, or information obtained from, any expert and shall not be responsible to anyone for any loss occasioned by so acting. Any such opinion, advice or information may be sent or obtained by letter or fax and the Trustee shall not be liable to anyone for acting in good faith on any opinion, advice or information purporting to be conveyed by such means even if it contains some error or is not authentic. | ||
8.2 | Trustee to Assume Performance | |
The Trustee need not notify anyone of the execution of this Trust Deed or do anything to find out if an Event of Default or Potential Event of Default has occurred. Until it has actual knowledge or express notice to the contrary, the Trustee may assume that no such event has occurred and that each Issuer and the Guarantor is performing all of its obligations under this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons provided that the Trustee shall not be treated for any purposes as having any notice or knowledge which has been obtained by it or any officer or employee of it in some capacity other than as Trustee under this Trust Deed or in a private or confidential capacity such that it would not be proper to disclose to third parties. |
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8.3 | Resolutions of Instrumentholders | |
The Trustee shall not be responsible for having acted in good faith on a resolution purporting to have been passed at a meeting of Instrumentholders in respect of which minutes have been made and signed even if it is later found that there was a defect in the constitution of the meeting or the passing of the resolution or that the resolution was not valid or binding on the Instrumentholders or Couponholders. | ||
8.4 | Certificate Signed by a Director, etc. | |
If the Trustee, in the exercise of its functions, requires to be satisfied or to have information as to any fact or the expediency of any act, it may call for and accept as sufficient evidence of that fact or the expediency of that act a certificate signed by any Director or the Company Secretary of the relevant Issuer or the Guarantor (if applicable) as to that fact or to the effect that, in their opinion, that act is expedient and the Trustee need not call for further evidence and shall not be responsible for any loss occasioned by acting on such a certificate. | ||
8.5 | Deposit of Documents | |
The Trustee may deposit this Trust Deed and any other documents with any bank or entity whose business includes the safe custody of documents or with any lawyer or firm of lawyers believed by it to be of good repute and may pay all sums due in respect of them. | ||
8.6 | Discretion | |
The Trustee shall have absolute and uncontrolled discretion as to the exercise of its functions and shall not be responsible for any loss, liability, cost, claim, action, demand, expense or inconvenience which may result from their exercise or non-exercise. | ||
8.7 | Agents | |
Whenever it considers it expedient in the interests of the Instrumentholders, the Trustee may, in the conduct of its trust business, instead of acting personally, employ and pay an agent selected by it, whether or not a lawyer or other professional person, to transact or conduct, or concur in transacting or conducting, any business and to do or concur in doing all acts required to be done by the Trustee (including the receipt and payment of money). The Trustee shall not be responsible to anyone for any misconduct or omission by any such agent so employed by it or be bound to supervise the proceedings or acts of any such agent. | ||
8.8 | Delegation | |
Whenever it considers it expedient in the interests of the Instrumentholders, the Trustee may delegate to any person on any terms (including power to sub-delegate) all or any of its functions. If the Trustee exercises reasonable care in selecting such delegate, it shall not have any obligation to supervise such delegate or be responsible for any loss, liability, cost, claim, action, demand or expense incurred by reason of any misconduct or default by any such delegate or sub-delegate. |
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8.9 | Nominees | |
In relation to any asset held by it under this Trust Deed, the Trustee may appoint any person to act as its nominee on any terms. | ||
8.10 | Forged Instruments | |
The Trustee shall not be liable to the relevant Issuer, the Guarantor (if applicable) or any Instrumentholder or Couponholder by reason of having accepted as valid or not having rejected any Instrument, Certificate, Receipt, Coupon or Talon purporting to be such and later found to be forged or not authentic. | ||
8.11 | Confidentiality | |
Unless ordered to do so by a court of competent jurisdiction, the Trustee shall not be required to disclose to any Instrumentholder or Couponholder any confidential financial or other information made available to the Trustee by the relevant Issuer or the Guarantor (if applicable). | ||
8.12 | Determinations Conclusive | |
As between itself and the Instrumentholders and Couponholders, the Trustee may determine all questions and doubts arising in relation to any of the provisions of this Trust Deed. Such determinations, whether made upon such a question actually raised or implied in the acts or proceedings of the Trustee, shall be conclusive and shall bind the Trustee, the Instrumentholders and the Couponholders. | ||
8.13 | Currency Conversion | |
Where it is necessary or desirable to convert any sum from one currency to another, it shall (unless otherwise provided hereby or required by law) be converted at such rate or rates, in accordance with such method and as at such date as may reasonably be specified by the Trustee but having regard to current rates of exchange, if available. Any rate, method and date so specified shall be binding on the relevant Issuer, the Guarantor (if applicable), the Instrumentholders and the Couponholders. | ||
8.14 | Payment for and Delivery of Instruments | |
The Trustee shall not be responsible for the receipt or application by the relevant Issuer of the proceeds of the issue of the Instruments, any exchange of Instruments or the delivery of Instruments to the persons entitled to them. | ||
8.15 | Trustees consent | |
Any consent given by the Trustee for the purposes of this Trust Deed may be given on such terms as the Trustee thinks fit. In giving such consent the Trustee may require the Issuers to agree to such modifications or additions to this Trust Deed as the Trustee may deem expedient in the interest of the Instrumentholders. |
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8.16 | Instruments Held by an Issuer etc. | |
In the absence of knowledge or express notice to the contrary, the Trustee may assume without enquiry (other than requesting a certificate under Clause 6.12 ( Instruments Held by an Issuer or Guarantor etc .)) that no Instruments are for the time being held by or on behalf of the relevant Issuer, the Guarantor (if applicable) or their respective subsidiary undertakings. | ||
8.17 | Legal Opinions | |
The Trustee shall not be responsible to any person for failing to request, require or receive any legal opinion relating to any Instruments or for checking or commenting upon the content of any such legal opinion. | ||
8.18 | Programme Limit | |
The Trustee shall not be concerned, and need not enquire, as to whether or not any Instruments are issued in breach of the Programme Limit. | ||
8.19 | Events of Default | |
The Trustee may determine whether or not an Event of Default is in its opinion capable of remedy or (in relation to Condition 9) materially prejudicial to the interests of Instrumentholders. Any such determination shall be conclusive and binding on the relevant Issuer, the Guarantor (if applicable), the Instrumentholders and the Couponholders. | ||
9 | Trustee Liable for Negligence | |
9.1 | Disapplication | |
Section 1 of the Trustee Act 2000 shall not apply to the duties of the Trustee in relation to the trusts constituted by this Trust Deed. Where there are any inconsistencies between the Trustee Acts and the provisions of this Trust Deed, the provisions of this Trust Deed shall, to the extent allowed by law, prevail and, in the case of any such inconsistency with the Trustee Act 2000, the provisions of this Trust Deed shall constitute a restriction or exclusion for the purposes of that Act. | ||
9.2 | Trustee Liability | |
Subject to Sections 750 and 751 of the Companies Act 2006 (if applicable) and notwithstanding anything to the contrary in this Trust Deed, the Instruments or the Paying Agency Agreement, the Trustee shall not be liable to any person for any matter or thing done or omitted in any way in connection with or in relation to this Trust Deed, the Instruments or the Agency Agreement save in relation to its own gross negligence, wilful default or fraud. |
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10 | Waiver and Proof of Default | |
10.1 | Waiver | |
The Trustee may, without the consent of the Instrumentholders or Couponholders and without prejudice to its rights in respect of any subsequent breach, from time to time and at any time, if in its opinion the interests of the Instrumentholders will not be materially prejudiced thereby, waive or authorise, on such terms as seem expedient to it, any breach or proposed breach by an Issuer or the Guarantor of this Trust Deed or the Conditions or determine that an Event of Default or Potential Event of Default shall not be treated as such provided that the Trustee shall not do so in contravention of an express direction given by an Extraordinary Resolution or a request made pursuant to Condition 9. No such direction or request shall affect a previous waiver, authorisation or determination. Any such waiver, authorisation or determination shall be binding on the Instrumentholders and the Couponholders and, if the Trustee so requires, shall be notified to the Instrumentholders as soon as practicable. | ||
10.2 | Proof of Default | |
Proof that the relevant Issuer has failed to pay a sum due to the holder of any one Instrument, Receipt or Coupon shall (unless the contrary be proved) be sufficient evidence that it has made the same default as regards all other Instruments, Receipts or Coupons which are then payable. | ||
11 | Trustee not Precluded from Entering into Contracts | |
The Trustee and any other person, whether or not acting for itself, may acquire, hold or dispose of any Instrument, Receipt, Coupon, Talon or other security (or any interest therein) of any of the Issuers, the Guarantor or any other person, may enter into or be interested in any contract or transaction with any such person and may act on, or as depositary or agent for, any committee or body of holders of any securities of any such person in each case with the same rights as it would have had if the Trustee were not acting as Trustee and need not account for any profit. | ||
12 | Modification and Substitution | |
12.1 | Modification | |
The Trustee may agree without the consent of the Instrumentholders or Couponholders to any modification to this Trust Deed of a formal, minor or technical nature or to correct a manifest error. The Trustee may also so agree to any modification to this Trust Deed which is in its opinion not materially prejudicial to the interests of the Instrumentholders, but such power does not extend to any such modification as is mentioned in the proviso to paragraph 2 of Schedule 3 ( Provisions for Meetings of Instrumentholders ). Any such modification, authorisation or waiver shall be binding on the relevant Instrumentholders and Couponholders and if the Trustee so requires, such modification shall be notified to the relevant Instrumentholders as soon as practicable. |
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12.2 | Substitution |
12.2.1 | The Trustee may, without the consent of the Instrumentholders or Couponholders, agree to (a) the substitution of National Grid Gass Successor in Business or any subsidiary of National Grid Gas (the Substituted Obligor ) in place of National Grid Gas, as the case may be (or of any previous substitute under this Clause 12) as the principal debtor under this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons; (b) the substitution of any other company (the Substituted Obligor ) in place of National Grid Finance (No 1) (or of any previous substitute under this Clause 12) as the principal debtor under this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons; and (c) the substitution of the Guarantors Successor in Business or any subsidiary of the Guarantor (also a Substituted Obligor ) in place of the Guarantor as the guarantor of Instruments issued by National Grid Gas Finance (No 1), provided that: |
(i) | a deed is executed or undertaking given by the Substituted Obligor to the Trustee, in form and manner satisfactory to the Trustee, agreeing to be bound by this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons (with consequential amendments as the Trustee may deem appropriate) as if the Substituted Obligor had been named in this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons as the principal debtor in place of such Issuer or as the guarantor in place of the Guarantor, as the case may be; | ||
(ii) | if the Substituted Obligor is subject generally to the taxing jurisdiction of a territory or any authority of or in that territory with power to tax (the Substituted Territory ) other than the territory to the taxing jurisdiction of which (or to any such authority of or in which) such Issuer is subject generally (the Issuers Territory ) or to which the Guarantor is subject generally (the Guarantors Territory ), the Substituted Obligor shall (unless the Trustee otherwise agrees) give to the Trustee an undertaking satisfactory to the Trustee in terms corresponding to Condition 7 with the substitution for the references in that Condition to such Issuers Territory or the Guarantors Territory, as the case may be, of references to the Substituted Territory whereupon the Trust Deed, the Instruments, the Receipts, the Coupons and the Talons shall be read accordingly; | ||
(iii) | if any two Directors of the Substituted Obligor certify that it will be solvent immediately after such substitution, the Trustee need not have regard to the Substituted Obligors financial condition, profits or prospects or compare them with those of such Issuer or the Guarantor; | ||
(iv) | such Issuer, the Guarantor and the Substituted Obligor comply with such other requirements as the Trustee may direct in the interests of the Instrumentholders; | ||
(v) | the Trustee is satisfied that (i) the Substituted Obligor has obtained all necessary governmental and regulatory approvals and consents necessary for its assumption of liability as principal debtor or guarantor, as the case may be, in respect of the Instruments in place of such Issuer or the Guarantor, as the case may be (or a previous substitute), (ii) all necessary governmental and regulatory approvals and consents necessary for or in |
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connection with the assumption by the Substituted Obligor of its obligations under the Instruments and the Coupons and (iii) such approvals and consents are at the time of substitution in full force and effect; and | |||
(vi) | a guarantee is provided in respect of the Instruments, the Receipts, the Coupons and the Talons by the relevant Issuer or the Guarantor, as the case may be (or the Successor in Business) unless the Substituted Obligor is the Successor in Business. |
12.2.2 | Release of Substituted Issuer : An agreement by the Trustee pursuant to this Clause 12.2 ( Substitution ) shall, if so expressed, release the relevant Issuer (or a previous substitute) from any or all of its obligations under this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons. Notice of the substitution shall be given to the Instrumentholders within 14 days of the execution of such documents and compliance with such requirements. | ||
12.2.3 | Completion of Substitution : On completion of the formalities set out in this Clause 12.2 ( Substitution ), the Substituted Obligor shall be deemed to be named in this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons as the principal debtor in place of the relevant Issuer (or of any previous substitute) and this Trust Deed, the Instruments, the Receipts, the Coupons and the Talons shall be deemed to be amended as necessary to give effect to the substitution. |
13 | Appointment, Retirement and Removal of The Trustee | |
13.1 | Appointment | |
Each of the Issuers has the power of appointing new trustees but no one may be so appointed unless previously approved by an Extraordinary Resolution. A trust corporation shall at all times be a Trustee and may be the sole Trustee. Any appointment of a new Trustee shall be notified by the relevant Issuer to the Instrumentholders in accordance with Condition 14 as soon as practicable. | ||
13.2 | Retirement and Removal | |
Any Trustee may retire at any time on giving at least three months written notice to each of the Issuers and the Guarantor without giving any reason or being responsible for any costs occasioned by such retirement and the Instrumentholders may by Extraordinary Resolution remove any Trustee provided that the retirement or removal of a sole trust corporation shall not be effective until a trust corporation is appointed as successor Trustee. If a sole trust corporation gives notice of retirement or an Extraordinary Resolution is passed for its removal, it shall use all reasonable endeavours to procure that another trust corporation is appointed as Trustee. | ||
13.3 | Co-Trustees | |
The Trustee may, despite Clause 13.1 ( Appointment ), by written notice to each of the Issuers and the Guarantor appoint anyone to act either as a separate Trustee in respect of any Issue or as an additional Trustee jointly with the Trustee: |
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13.3.1 | if the Trustee considers the appointment to be in the interests of the Instrumentholders and/or the Couponholders; | ||
13.3.2 | to conform with a legal requirement, restriction or condition in a jurisdiction in which a particular act is to be performed; or | ||
13.3.3 | to obtain a judgment or to enforce a judgment or any provision of this Trust Deed in any jurisdiction. |
Subject to the provisions of this Trust Deed the Trustee may, in the instrument of appointment, confer on any person so appointed such functions as it thinks fit. The Trustee may by written notice to each of the Issuers, the Guarantor and that person remove that person. At the Trustees request, each Issuer and the Guarantor shall forthwith do all things as may be required to perfect such appointment or removal and it irrevocably appoints the Trustee as its attorney in its name and on its behalf to do so. | ||
Before appointing such person to act as separate Trustee or additional Trustee the Trustee shall (unless it is not, in the opinion of the Trustee, reasonably practicable to do so) give notice to each of the Issuers and the Guarantor of its intention to make such appointment (and the reason for that) and shall give due consideration to representations made by each of the Issuers and the Guarantor concerning such appointment. Where, as a result of this provision, not all the Instruments have the same Trustee, the provisions of this Trust Deed shall apply in respect of each such Trustee as if each were named as a party to this Trust Deed. | ||
13.4 | Competence of a Majority of Trustees | |
If there are more than two Trustees the majority of them shall be competent to perform the Trustees functions provided the majority includes a trust corporation. | ||
14 | Instruments Held in Clearing Systems and Couponholders | |
14.1 | Instruments Held in Clearing Systems | |
So long as any Global Instrument is held on behalf of a clearing system, in considering the interests of Instrumentholders, the Trustee may have regard to any information provided to it by such clearing system or its operator as to the identity (either individually or by category) of its accountholders or participants with entitlements to any such Global Instrument and may consider such interests on the basis that such accountholders or participants were the holder(s) of such Global Instrument. | ||
14.2 | Reliance on Instruments Held in Clearing Systems | |
The Trustee and any Issuer may call for and, except in the case of manifest error, shall be at liberty to accept and place full reliance on as sufficient evidence thereof any certificate, letter of confirmation or other document issued on behalf of Euroclear or Clearstream, Luxembourg or any form of record made by any of them or such other evidence and/or information and/or certification as it shall, in its absolute discretion, think fit to the effect that at any particular time or throughout any particular period any particular person is, was, or will be, shown in its records as the holder of a particular nominal amount of Instruments represented by a Global Instrument and if the Trustee or any Issuer does so rely, such letter of confirmation, form of record, evidence, information or certification shall be |
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conclusive and binding on all concerned for all purposes. Any such certificate may comprise any form of statement or print out of electronic records provided by the relevant clearing system (including Euroclears EUCLID or Clearstream, Luxembourgs Creation Online system) in accordance with its usual procedures and in which the holder of a particular nominal amount of Instruments is clearly identified together with the amount of such holding. Neither an Issuer nor the Trustee shall be liable to any person by reason of having accepted as valid or not having rejected any certificate or other document to such effect purporting to be issued by Euroclear or Clearstream, Luxembourg and subsequently found to be forged or not authentic. | ||
14.3 | Couponholders | |
No notices need be given to Couponholders. They shall be deemed to have notice of the contents of any notice given to Instrumentholders. Even if it has express notice to the contrary, in exercising any of its functions by reference to the interests of the Instrumentholders, the Trustee shall assume that the holder of each Instrument is the holder of all Receipts, Coupons and Talons relating to it. | ||
15 | Currency Indemnity | |
15.1 | Currency of Account and Payment | |
The Contractual Currency is the sole currency of account and payment for all sums payable by each of the Issuers or the Guarantor under or in connection with this Trust Deed, the Instruments, the Receipts and the Coupons, including damages. | ||
15.2 | Extent of Discharge | |
An amount received or recovered in a currency other than the Contractual Currency (whether as a result of, or of the enforcement of, a judgment or order of a court of any jurisdiction, in the insolvency, winding-up or dissolution of any of the Issuers or the Guarantor or otherwise), by the Trustee or any Instrumentholder or Couponholder in respect of any sum expressed to be due to it from the relevant Issuer or the Guarantor, shall only discharge such Issuer or the Guarantor to the extent of the Contractual Currency amount which the recipient is able to purchase with the amount so received or recovered in that other currency on the date of that receipt or recovery (or, if it is not practicable to make that purchase on that date, on the first date on which it is practicable to do so). | ||
15.3 | Indemnity | |
If that Contractual Currency amount is less than the Contractual Currency amount expressed to be due to the recipient under this Trust Deed, the Instruments, the Receipts or the Coupons, the relevant Issuer shall indemnify it against any loss sustained by it as a result. In any event, the relevant Issuer shall indemnify the recipient against the cost of making any such purchase. | ||
15.4 | Indemnity Separate | |
The indemnities in this Clause 15 and in Clause 7.5 ( Indemnity ) constitute separate and independent obligations from the other obligations in this Trust Deed, shall give rise to a separate and independent course of action, shall apply irrespective of any indulgence |
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granted by the Trustee and/or any Instrumentholder or Couponholder and shall continue in full force and effect despite any judgment, order, claim or proof for a liquidated amount in respect of any sum due under this Trust Deed, the Instruments, the Receipts and/or the Coupons or any other judgment or order. | ||
16 | Enforcement | |
16.1 | Trustee to enforce | |
Only the Trustee may enforce the rights of the Instrumentholders and Couponholders against the relevant Issuer or the Guarantor, whether the same arise under the general law, this Trust Deed, the Instruments, the Coupons or otherwise, and no Instrumentholder or Couponholder shall be entitled to proceed directly against the relevant Issuer or the Guarantor unless the Trustee, having become bound to proceed, fails to do so within a reasonable time and such failure is continuing. | ||
16.2 | Trustees Indemnity | |
The Trustee shall not be bound to take any steps to enforce the performance of any provisions of this Trust Deed, the Instruments or the Coupons unless it shall be indemnified and/or secured and/or prefunded by the Instrumentholders and/or Couponholders to its satisfaction against all proceedings, claims and demands to which it may be liable and against all costs, charges, liabilities and expenses which may be incurred by it in connection with such enforcement, including the cost of its managements time and/or other internal resources, calculated using its normal hourly rates in force from time to time. | ||
16.3 | Legal proceedings | |
If the Trustee (or any Instrumentholder or Couponholder where entitled in accordance with this Trust Deed so to do) institutes legal proceedings against any of the Issuers or the Guarantor to enforce any obligations under this Trust Deed: |
16.3.1 | proof in such proceedings that as regards any specified Instrument such Issuer or the Guarantor, as the case may be, has made default in paying any principal or interest due to the relevant Instrumentholder shall (unless the contrary be proved) be sufficient evidence that such Issuer or the Guarantor, as the case may be, has made the same default as regards all other Instruments which are then repayable or, as the case may be, in respect of which interest is then payable; and | ||
16.3.2 | proof in such proceedings that as regards any specified Coupon such Issuer or the Guarantor, as the case may be, has made default in paying any sum due to the relevant Couponholder shall (unless the contrary be proved) be sufficient evidence that such Issuer or the Guarantor, as the case may be, has made the same default as regards all other Coupons which are then payable. |
16.4 | Powers additional to general powers | |
The powers conferred on the Trustee by this Clause 16 shall be in addition to any powers which may from time to time be vested in the Trustee by general law or as the holder of any Instruments or Coupons. |
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17 | Communications | |
17.1 | Method | |
Each communication under this Trust Deed shall be made by fax or otherwise in writing. Each communication or document to be delivered to any party under this Trust Deed shall be sent to that party at the fax number or address, and marked for the attention of the person (if any), from time to time designated by that party to each other party for the purpose of this Trust Deed. The initial telephone number, fax number, address and person so designated by the parties under this Trust Deed are set out in the Procedures Memorandum. | ||
17.2 | Deemed Receipt | |
Any communication from any party to any other under this Trust Deed shall be effective, (if by fax) when good receipt is confirmed by the recipient following enquiry by the sender and (if in writing) when delivered, except that a communication received outside normal business hours shall be deemed to be received on the next business day in the city in which the recipient is located. | ||
18 | Governing Law and Jurisdiction | |
18.1 | Governing Law | |
This Trust Deed and any non-contractual obligations arising out of or in connection with it shall be governed by, and construed in accordance with, English law. | ||
18.2 | Jurisdiction | |
The courts of England are to have jurisdiction to settle any disputes that may arise out of or in connection with this Trust Deed, the Instruments, the Receipts, the Coupons or the Talons and accordingly any legal action or proceedings arising out of or in connection with this Trust Deed, the Instruments, the Receipts, the Coupons or the Talons ( Proceedings ) may be brought in such courts. Each of the Issuers and the Guarantor irrevocably submits to the jurisdiction of such courts and waives any objections to Proceedings in such courts on the ground of venue or on the ground that the Proceedings have been brought in an inconvenient forum. Each such submission is for the benefit of each of the Trustee, the Instrumentholders and the Couponholders and shall not limit the right of any of them to take Proceedings in any other court of competent jurisdiction nor shall the taking of Proceedings in any one or more jurisdictions preclude the taking of Proceedings in any other jurisdiction (whether concurrently or not). |
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* | Delete as applicable | |
** | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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30
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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* | Delete as applicable |
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Reason for | ||||||||
decrease in | ||||||||
nominal amount | Nominal amount | |||||||
Amount of | of this | of this | ||||||
decrease in | temporary | temporary | ||||||
nominal amount | Global | Global | Notation made | |||||
of this | Instrument | Instrument on | by or on behalf | |||||
temporary | (exchange, | issue or | of the Issuing | |||||
Global | cancellation or | following such | and Paying | |||||
Date | Instrument | forfeiture) | decrease | Agent | ||||
Issue Date
|
not applicable | not applicable |
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34
* | Delete as applicable | |
** | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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36
37
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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(a) | is freely transferable by delivery and such transfer shall operate to confer upon the transferee all rights and benefits appertaining to this permanent Global Instrument and to bind the transferee with all obligations appertaining to this permanent Global Instrument pursuant to the Conditions; |
(b) | the holder of this permanent Global Instrument is and shall be absolutely entitled as against all previous holders to receive all amounts by way of amounts payable upon redemption, interest or otherwise payable in respect of this permanent Global Instrument and the Issuer has waived against such holder and any previous holder of this permanent Global Instrument all rights of set-off or counterclaim which would or might otherwise be available to it in respect of the obligations evidenced by this permanent Global Instrument; and |
(c) | payment upon due presentation of this permanent Global Instrument as provided in this permanent Global Instrument shall operate as a good discharge against such holder and all previous holders of this permanent Global Instrument. |
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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* | Delete as applicable |
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Reason for | ||||||||
increase/decrease | ||||||||
in nominal | ||||||||
amount of this | ||||||||
permanent Global | ||||||||
Instrument (initial | ||||||||
Amount of | issue, exchange, | Nominal amount | Notation | |||||
increase/decrease | cancellation, | of this permanent | made by or | |||||
in nominal | forfeiture or | Global Instrument | on behalf of | |||||
amount of this | payment, stating | on issue or | the Issuing | |||||
permanent Global | amount of | following such | and Paying | |||||
Date | Instrument | payment made) | increase/decrease | Agent | ||||
|
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Notation made by or | ||||||
on behalf of the | ||||||
Issuing and Paying | ||||||
Due date of payment | Date of payment | Amount of interest | Agent | |||
|
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Nominal amount of | ||||||
this permanent | Notation made by or | |||||
Global Instrument in | Date on which | on behalf of the | ||||
respect of which | exercise of such | Issuing and Paying | ||||
Date of exercise | exercise is made | option is effective | Agent | |||
|
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* | Delete as applicable | |
** | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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46
47
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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* | Delete as applicable |
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50
* | Delete as applicable | |
++ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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52
53
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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(a) | is freely transferable by delivery and such transfer shall operate to confer upon the transferee all rights and benefits appertaining to this permanent Global Instrument and to bind the transferee with all obligations appertaining to this permanent Global Instrument pursuant to the Conditions; |
(b) | the holder of this permanent Global Instrument is and shall be absolutely entitled as against all previous holders to receive all amounts by way of amounts payable upon redemption, interest or otherwise payable in respect of this permanent Global Instrument and the Issuer has waived against such holder and any previous holder of this permanent Global Instrument all rights of set-off or counterclaim which would or might otherwise be available to it in respect of the obligations evidenced by this permanent Global Instrument; and |
(c) | payment upon due presentation of this permanent Global Instrument as provided in this permanent Global Instrument shall operate as a good discharge against such holder and all previous holders of this permanent Global Instrument. |
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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* | Delete as applicable |
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[Denomination] | [ISIN] | [Series] | [Certif. No.] |
* | Delete as applicable | |
+ | Only applicable where National Grid Gas Finance (No 1) is the Issuer. |
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National Grid Gas plc ( National Grid Gas ) and National Grid Gas Finance (No 1) plc ( National Grid Gas Finance (No 1) ) (each an Issuer and together, the Issuers ) and National Grid Gas plc as guarantor of Instruments issued by National Grid Gas Finance (No 1) (the Guarantor ) have established a Euro Medium Term Note Programme (the Programme ) for the issuance of up to 10,000,000,000 in aggregate principal amount of debt instruments (the Instruments ). | ||
The Instruments are constituted by an Amended and Restated Trust Deed (as amended or supplemented from time to time, the Trust Deed ) dated 18 February 2011 between the Issuers, the Guarantor and The Law Debenture Trust Corporation p.l.c. (the Trustee , which expression shall include all persons for the time being the trustee or trustees under the Trust Deed) as trustee for the Instrumentholders (as defined below). These terms and conditions include summaries of, and are subject to, the detailed provisions of the Trust Deed, which includes the form of the Definitive Instruments, Receipts, Coupons and Talons referred to below. An Amended and Restated Agency Agreement (as amended or supplemented from time to time, the Agency Agreement ) dated 18 February 2011 has been entered into in relation to the Instruments between the Issuers, the Guarantor, the Trustee, The Bank of New York Mellon as initial issuing and paying agent and the other agent(s) named in it. The issuing and paying agent, the paying agent(s) and the calculation agent(s) for the time being (if any) are referred to below respectively as the Issuing and Paying Agent , the Paying Agents (which expression shall include the Issuing and Paying Agent) and the Calculation Agent(s) . Copies of the Trust Deed and the Agency Agreement are available for inspection during usual business hours at the registered office of the Trustee (as at 18 February 2011 at Fifth Floor, 100 Wood Street, London EC2V 7EX) and at the specified offices of the Paying Agents. | ||
The Instrumentholders, the holders of the interest coupons (the Coupons ) appertaining to interest bearing Instruments and, where applicable in the case of such Instruments, talons for further Coupons (the Talons ) (the Couponholders ) and the holders of the receipts for the payment of instalments of principal (the Receipts ) relating to Instruments of which the principal is payable in instalments are entitled to the benefit of, are bound by, and are deemed to have notice of, all the provisions of the Trust Deed (including the Guarantee) and are deemed to have notice of those provisions of the Agency Agreement applicable to them. | ||
1 | Form, Denomination and Title | |
The Instruments are issued in bearer form in the Specified Denomination(s) specified in the relevant Final Terms and are serially numbered. Instruments of one Specified Denomination are not exchangeable for Instruments of another Specified Denomination. | ||
In the case of Instruments which are to be admitted to trading on a regulated market within the European Economic Area or offered to the public in a Member State of the European Economic Area in circumstances which require the publication of a prospectus under Directive 2003/71/EC (the Prospectus Directive ), the minimum Specified Denomination shall be 100,000 (or its equivalent in any other currency as at the date of issue of the relevant Instruments). | ||
This Instrument is a Fixed Rate Instrument, a Floating Rate Instrument, a Zero Coupon Instrument, a Perpetual Instrument, an Index Linked Interest Instrument, an Index Linked Redemption Instrument, an Instalment Instrument, a Dual Currency Instrument or a Partly Paid Instrument, a combination of any of the preceding or any other kind of Instrument, depending upon the Interest and Redemption/Payment Basis specified in the relevant Final Terms. |
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Instruments are issued with Coupons (and, where appropriate, a Talon) attached, save in the case of Zero Coupon Instruments in which case references to interest (other than in relation to interest due after the Maturity Date), Coupons and Talons in these Conditions are not applicable. | ||
Instalment Instruments are issued with one or more Receipts attached. Title to the Instruments and the Receipts, Coupons and Talons shall pass by delivery and except as ordered by a court of competent jurisdiction or as required by law, the Issuer, the Guarantor (if applicable) and the Paying Agents shall be entitled to treat the bearer of any Instrument, Receipt, Coupon or Talon as the absolute owner of that Instrument, Receipt, Coupon or Talon, as the case may be, and shall not be required to obtain any proof of ownership as to the identity of the bearer. | ||
In these Conditions, Instrumentholder means the bearer of any Instrument of one Series only of an Issuer and the Receipts relating to it, holder (in relation to an Instrument, Receipt, Coupon or Talon) means the bearer of any Instrument, Receipt, Coupon or Talon and capitalised terms have the meanings given to them herein, the absence of any such meaning indicating that such term is not applicable to this Instrument. |
2 | Status [and Guarantee]* |
2.1 | Status | ||
The Instruments and the Receipts and Coupons relating to them constitute direct, unconditional and unsecured obligations of the Issuer and rank pari passu without any preference or priority among themselves. The payment obligations of the Issuer under the Instruments, Receipts and Coupons [and of the Guarantor under the Guarantee]* shall, subject to such exceptions as are from time to time applicable under the laws of England, rank equally with all other present and future unsecured obligations (other than subordinated obligations, if any) of the Issuer [and the Guarantor respectively]*. | |||
2.2 | [Guarantee | ||
The Guarantor has unconditionally and irrevocably guaranteed the due payment of all sums expressed to be payable by the Issuer under the Trust Deed, the Instruments, Receipts and Coupons. Its obligations in that respect (the Guarantee ) are contained in the Trust Deed.]* |
3 | Interest |
3.1 | Interest on Fixed Rate Instruments | ||
Each Fixed Rate Instrument bears interest on its outstanding nominal amount from the Interest Commencement Date at the rate per annum (expressed as a percentage) equal to the Rate of Interest, payable in arrear on each Interest Payment Date. The amount of interest payable shall be determined in accordance with Condition 3.2.4(f). | |||
3.2 | Interest on Floating Rate Instruments and Index Linked Interest Instruments |
3.2.1 | Interest Payment Dates | ||
Each Floating Rate Instrument and Index Linked Interest Instrument bears interest on its outstanding nominal amount from the Interest Commencement Date at the rate per annum (expressed as a percentage) equal to the Rate of Interest, such interest being payable in arrear on each Interest Payment Date. The amount of interest payable shall be determined in accordance with Condition 3.2.4(f). Such Interest Payment Date(s) is/are either specified in the relevant Final Terms as Specified Interest Payment Dates or, if no Specified Interest Payment Date(s) is/are specified in the relevant Final Terms, Interest Payment Date shall mean each date which falls the number of months or other period shown on this Instrument |
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as the Interest Period after the preceding Interest Payment Date or, in the case of the first Interest Payment Date, after the Interest Commencement Date. |
3.2.2 | Business Day Convention | ||
If any date which is specified to be subject to adjustment in accordance with a Business Day Convention would otherwise fall on a day which is not a Business Day, then, if the Business Day Convention specified is (A) the Floating Rate Convention, such date shall be postponed to the next day which is a Business Day unless it would then fall into the next calendar month, in which event (x) such date shall be brought forward to the immediately preceding Business Day and (y) each subsequent such date shall be the last Business Day of the month in which such date would have fallen had it not been subject to adjustment, (B) the Following Business Day Convention, such date shall be postponed to the next day which is a Business Day; (C) the Modified Following Business Day Convention, such date shall be postponed to the next day which is a Business Day unless it would then fall into the next calendar month, in that event such date shall be brought forward to the immediately preceding Business Day or (D) the Preceding Business Day Convention, such date shall be brought forward to the immediately preceding Business Day. | |||
3.2.3 | Rate of Interest for Floating Rate Instruments | ||
The Rate of Interest in respect of Floating Rate Instruments for each Interest Accrual Period shall be determined in the manner specified in the relevant Final Terms and the provisions below relating to either ISDA Determination or Screen Rate Determination shall apply, depending upon which is specified in the relevant Final Terms. |
(A) | ISDA Determination for Floating Rate Instruments: Where ISDA Determination is specified in the relevant Final Terms as the manner in which the Rate of Interest is to be determined, the Rate of Interest for each Interest Accrual Period shall be determined by the Calculation Agent as a rate equal to the relevant ISDA Rate. For the purposes of this sub-paragraph (A), ISDA Rate for an Interest Accrual Period means a rate equal to the Floating Rate which would be determined by the Calculation Agent under a Swap Transaction under the terms of an agreement incorporating the ISDA Definitions and under which: |
(x) | the Floating Rate Option is as specified in the relevant Final Terms; | ||
(y) | the Designated Maturity is a period specified in the relevant Final Terms; and | ||
(z) | the relevant Reset Date is the first day of that Interest Accrual Period unless otherwise specified in the relevant Final Terms. |
For the purposes of this sub-paragraph (A), Floating Rate , Calculation Agent , Floating Rate Option , Designated Maturity , Reset Date and Swap Transaction have the meanings given to those terms in the ISDA Definitions. | |||
(B) | Screen Rate Determination for Floating Rate Instruments: Where Screen Rate Determination is specified in the relevant Final Terms as the manner in which the Rate of Interest is to be determined, the Rate of Interest for each Interest Accrual Period shall be determined by the Calculation Agent at or about the Relevant Time on the Interest Determination Date in respect of such Interest Accrual Period in accordance with the following: |
(x) | if the Primary Source for Floating Rate is a Page, subject as provided below, the Rate of Interest shall be: |
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(a) | the Relevant Rate (where such Relevant Rate on such Page is a composite quotation or is customarily supplied by one entity); or | ||
(b) | the arithmetic mean of the Relevant Rates of the persons whose Relevant Rates appear on that Page, in each case appearing on such Page at the Relevant Time on the Interest Determination Date; |
(y) | if the Primary Source for the Floating Rate is Reference Banks or if sub-paragraph (x) (a) applies and no Relevant Rate appears on the Page at the Relevant Time on the Interest Determination Date or if sub-paragraph (x) (b) above applies and fewer than two Relevant Rates appear on the Page at the Relevant Time on the Interest Determination Date, subject as provided below, the Rate of Interest shall be the arithmetic mean of the Relevant Rates that each of the Reference Banks is quoting to leading banks in the Relevant Financial Centre at the Relevant Time on the Interest Determination Date, as determined by the Calculation Agent; and | ||
(z) | if paragraph (y) above applies and the Calculation Agent determines that fewer than two Reference Banks are so quoting Relevant Rates, subject as provided below, the Rate of Interest shall be the arithmetic mean of the rates per annum (expressed as a percentage) that the Calculation Agent determines to be the rates (being the nearest equivalent to the Benchmark) in respect of a Representative Amount of the Specified Currency that at least two out of five leading banks selected by the Calculation Agent in the principal financial centre of the country of the Specified Currency or, if the Specified Currency is euro in those Member States of the European Union which are participating in European economic and monetary union as selected by the Calculation Agent (the Principal Financial Centre ) are quoting at or about the Relevant Time on the date on which such banks would customarily quote such rates for a period commencing on the Effective Date for a period equivalent to the Specified Duration (I) to leading banks carrying on business in Europe, or (if the Calculation Agent determines that fewer than two of such banks are so quoting to leading banks in Europe) (II) to leading banks carrying on business in the Principal Financial Centre; except that, if fewer than two of such banks are so quoting to leading banks in the Principal Financial Centre, the Rate of Interest shall be the Rate of Interest determined on the previous Interest Determination Date (after readjustment for any difference between any Margin, Rate Multiplier or Maximum or Minimum Rate of Interest applicable to the preceding Interest Accrual Period and to the relevant Interest Accrual Period). |
3.2.4 | Rate of Interest for Index Linked Interest Instruments | ||
The Rate of Interest in respect of Index Linked Interest Instruments for each Interest Accrual Period shall be determined in the manner specified in the relevant Final Terms and interest will accrue by reference to an Index or Formula as specified in the relevant Final Terms. |
(a) | Zero Coupon Instruments | ||
Where an Instrument, the Interest Basis of which is specified to be Zero Coupon, is repayable prior to the Maturity Date and is not paid when due, the amount due and payable prior to the Maturity Date shall be the Early Redemption Amount of such |
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Instrument. As from the Maturity Date, the Rate of Interest for any overdue principal of such an Instrument shall be a rate per annum (expressed as a percentage) equal to the Amortisation Yield (as defined in Condition 5.4.1(b)). |
(b) | Dual Currency Instruments | ||
In the case of Dual Currency Instruments, if the rate or amount of interest falls to be determined by reference to a Rate of Exchange or a method of calculating a Rate of Exchange, the rate or amount of interest payable shall be determined in the manner specified in the relevant Final Terms. | |||
(c) | Partly Paid Instruments | ||
In the case of Partly Paid Instruments (other than Partly Paid Instruments which are Zero Coupon Instruments), interest will accrue as previously stated on the paid-up nominal amount of such Instruments and otherwise as specified in the relevant Final Terms. | |||
(d) | Accrual of Interest | ||
Interest shall cease to accrue on each Instrument on the due date for redemption unless, upon due presentation, payment is improperly withheld or refused, in which event interest shall continue to accrue (as well after as before judgment) at the Rate of Interest in the manner provided in this Condition 3 to the Relevant Date (as defined in Condition 7). | |||
(e) | Margin, Maximum/Minimum Rates of Interest, Instalment Amounts and Redemption Amounts, Rate Multipliers and Rounding |
(i) | If any Margin or Rate Multiplier is specified in the relevant Final Terms (either (x) generally, or (y) in relation to one or more Interest Accrual Periods), an adjustment shall be made to all Rates of Interest, in the case of (x), or the Rates of Interest for the specified Interest Accrual Periods, in the case of (y), calculated in accordance with Condition 3.2 above, by adding (if a positive number) or subtracting (if a negative number) the absolute value of such Margin or multiplying by such Rate Multiplier, subject always to the next paragraph. | ||
(ii) | If any Maximum or Minimum Rate of Interest, Instalment Amount or Redemption Amount is specified in the relevant Final Terms, then any Rate of Interest, Instalment Amount or Redemption Amount shall be subject to such maximum or minimum, as the case may be. | ||
(iii) | For the purposes of any calculations required pursuant to these Conditions (unless otherwise specified), (x) all percentages resulting from such calculations shall be rounded, if necessary, to the nearest one hundred-thousandth of a percentage point (with halves being rounded up), (y) all figures shall be rounded to seven significant figures (with halves being rounded up) and (z) all currency amounts that fall due and payable shall be rounded to the nearest unit of such currency (with halves being rounded up), save in the case of yen, which shall be rounded down to the nearest yen. For these purposes unit means the lowest amount of such currency which is available as legal tender in the country of such currency. |
(f) | Calculations | ||
The amount of interest payable per Calculation Amount in respect of any Instrument for any Interest Accrual Period shall be equal to the product of the Rate of Interest, |
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the Calculation Amount specified thereon, and the Day Count Fraction for such Interest Accrual Period, unless an Interest Amount (or a formula for its calculation) is applicable to such Interest Accrual Period, in which case the amount of interest payable per Calculation Amount in respect of such Instrument for such Interest Accrual Period shall equal such Interest Amount (or be calculated in accordance with such formula). Where any Interest Period comprises two or more Interest Accrual Periods, the amount of interest payable per Calculation Amount in respect of such Interest Period shall be the sum of the Interest Amounts payable in respect of each of those Interest Accrual Periods. In respect of any other period for which interest is required to be calculated, the provisions above shall apply save that the Day Count Fraction shall be for the period for which interest is required to be calculated. |
(g) | Determination and Publication of Rates of Interest, Interest Amounts, Final Redemption Amounts, Early Redemption Amounts, Optional Redemption Amounts and Instalment Amounts | ||
As soon as practicable after the Relevant Time on each Interest Determination Date, or such other time on such date as the Calculation Agent may be required to calculate any rate or amount, obtain any quotation or make any determination or calculation, it shall determine such rate and calculate the Interest Amounts in respect of each Specified Denomination of the Instruments for the relevant Interest Accrual Period, calculate the Redemption Amount or Instalment Amount, obtain such quote or make such determination or calculation, as the case may be, and cause the Rate of Interest and the Interest Amounts for each Interest Period and the relevant Interest Payment Date and, if required to be calculated, the Final Redemption Amount, Early Redemption Amount, Optional Redemption Amount or any Instalment Amount to be notified to the Trustee, the Issuer,[ the Guarantor,]* each of the Paying Agents, the Instrumentholders, any other Calculation Agent appointed in respect of the Instruments that is to make a further calculation upon receipt of such information and, if the Instruments are listed on a stock exchange and the rules of such exchange so require, such exchange as soon as possible after their determination but in no event later than (i) the commencement of the relevant Interest Period, if determined prior to such time, in the case of notification to such exchange of a Rate of Interest and Interest Amount, or (ii) in all other cases, the fourth Business Day after such determination. Where any Interest Payment Date or Interest Period Date is subject to adjustment pursuant to Condition 3.2.2, the Interest Amounts and the Interest Payment Date so published may subsequently be amended (or appropriate alternative arrangements made with the consent of the Trustee by way of adjustment) without notice in the event of an extension or shortening of the Interest Period. If the Instruments become due and payable under Condition 9, the accrued interest and the Rate of Interest payable in respect of the Instruments shall nevertheless continue to be calculated as previously in accordance with this Condition but no publication of the Rate of Interest or the Interest Amount so calculated need be made unless the Trustee otherwise requires. The determination of any rate or amount, the obtaining of each quotation and the making of each determination or calculation by the Calculation Agent(s) shall (in the absence of manifest error) be final and binding upon all parties. | |||
(h) | Determination or Calculation by Trustee | ||
If the Calculation Agent does not at any time for any reason determine or calculate the Rate of Interest for an Interest Period or any Interest Amount, Instalment Amount, Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount the Trustee shall do so (or shall appoint an agent on its behalf to do so) and such determination or calculation shall be deemed to have been made |
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by the Calculation Agent. In doing so, the Trustee shall apply the preceding provisions of this Condition, with any necessary consequential amendments, to the extent that, in its opinion, it can do so, and, in all other respects it shall do so in such manner as it shall deem fair and reasonable in all the circumstances. |
(i) | Definitions | ||
In these Conditions, unless the context otherwise requires, the following defined terms shall have the meanings set out below: | |||
Benchmark means LIBOR, LIBID, LIMEAN, EURIBOR or such other Benchmark as may be specified in the relevant Final Terms. | |||
Business Day means: |
(i) | in the case of a currency other than euro, a day (other than a Saturday or Sunday) on which commercial banks and foreign exchange markets settle payments in the principal financial centre for such currency; and/or | ||
(ii) | in the case of euro, a day on which the TARGET System is operating (a TARGET Business Day ); and/or | ||
(iii) | in the case of a currency and/or one or more Business Centres as specified in the relevant Final Terms, a day (other than a Saturday or a Sunday) on which commercial banks and foreign exchange markets settle payments in such currency or, if no currency is indicated, generally in each of the Business Centres. |
Calculation Amount means the amount specified as such in the relevant Final Terms. | |||
Day Count Fraction means, in respect of the calculation of an amount of interest on any Instrument for any period of time (from and including the first day of such period to but excluding the last) (whether or not constituting an Interest Period, the Calculation Period ): |
(i) | if Actual/Actual or Actual/Actual-ISDA is specified in the relevant Final Terms, the actual number of days in the Calculation Period divided by 365 (or, if any portion of that Calculation Period falls in a leap year, the sum of (i) the actual number of days in that portion of the Calculation Period falling in a leap year divided by 366 and (ii) the actual number of days in that portion of the Calculation Period falling in a non-leap year divided by 365); | ||
(ii) | if Actual/365 (Fixed) is specified in the relevant Final Terms, the actual number of days in the Calculation Period divided by 365; | ||
(iii) | if Actual/360 is specified in the relevant Final Terms, the actual number of days in the Calculation Period divided by 360; | ||
(iv) | if 30/360, 360/360 or Bond Basis is specified in the relevant Final Terms, the number of days in the Calculation Period divided by 360, calculated on a formula basis as follows: |
Day Count Fraction = | [360 x (Y 2 -Y 1 )] + [30 x (M 2 -M 1 )]+ (D 2 -D 1 ) | |
360 |
where: | |||
Y 1 is the year, expressed as a number, in which the first day of the Calculation Period falls; |
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Y 2 is the year, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
M 1 is the calendar month, expressed as a number, in which the first day of the Calculation Period falls; | |||
M 2 is the calendar month, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
D 1 is the first calendar day, expressed as a number, of the Calculation Period, unless such number would be 31, in which case D 1 will be 30; and | |||
D 2 is the calendar day, expressed as a number, immediately following the last day included in the Calculation Period, unless such number would be 31 and D 1 is greater than 29, in which case D 2 will be 30 ; | |||
(v) | if 30E/360 or Eurobond Basis is specified in the relevant Final Terms, the number of days in the Calculation Period divided by 360, calculated on a formula basis as follows: |
Day Count Fraction = | [360 x (Y 2 -Y 1 )] + [30 x (M 2 -M 1 )]+ (D 2 -D 1 ) | |
360 |
where: | |||
Y 1 is the year, expressed as a number, in which the first day of the Calculation Period falls; | |||
Y 2 is the year, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
M 1 is the calendar month, expressed as a number, in which the first day of the Calculation Period falls; | |||
M 2 is the calendar month, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
D 1 is the first calendar day, expressed as a number, of the Calculation Period, unless such number would be 31, in which case D 1 will be 30; and | |||
D 2 is the calendar day, expressed as a number, immediately following the last day included in the Calculation Period, unless such number would be 31, in which case D 2 will be 30; | |||
(vi) | if 30E/360 (ISDA) is specified hereon, the number of days in the Calculation Period divided by 360, calculated on a formula basis as follows: |
Day Count Fraction = | [360 x (Y 2 -Y 1 )] + [30 x (M 2 -M 1 )]+ (D 2 -D 1 ) | |
360 |
where: | |||
Y 1 is the year, expressed as a number, in which the first day of the Calculation Period falls; | |||
Y 2 is the year, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
M 1 is the calendar month, expressed as a number, in which the first day of the Calculation Period falls; |
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M 2 is the calendar month, expressed as a number, in which the day immediately following the last day included in the Calculation Period falls; | |||
D 1 is the first calendar day, expressed as a number, of the Calculation Period, unless (i) that day is the last day of February or (ii) such number would be 31, in which case D 1 will be 30; and | |||
D 2 is the calendar day, expressed as a number, immediately following the last day included in the Calculation Period, unless (i) that day is the last day of February but not the Maturity Date or (ii) such number would be 31, in which case D 2 will be 30; and | |||
(vii) | if Actual/Actual-ICMA is specified in the relevant Final Terms, |
(a) | if the Calculation Period is equal to or shorter than the Determination Period during which it falls, the actual number of days in the Calculation Period divided by the product of (x) the actual number of days in such Determination Period and (y) the number of Determination Periods in any year; and | ||
(b) | if the Calculation Period is longer than one Determination Period, the sum of: |
(x) | the actual number of days in such Calculation Period falling in the Determination Period in which it begins divided by the product of (1) the actual number of days in such Determination Period and (2) the number of Determination Periods in any year; and | ||
(y) | the actual number of days in such Calculation Period falling in the next Determination Period divided by the product of (1) the actual number of days in such Determination Period and (2) the number of Determination Periods in any year, | ||
where: | |||
Determination Period means the period from and including a Determination Date in any year to but excluding the next Determination Date; and | |||
Determination Date means the date specified as such in the relevant Final Terms or, if none is so specified, the Interest Payment Date. |
Effective Date means, with respect to any Floating Rate to be determined on an Interest Determination Date, the date specified as such in the relevant Final Terms or, if none is so specified, the first day of the Interest Accrual Period to which such Interest Determination Date relates. | |||
Euro-zone means the region comprising of Member States of the European Union that adopt the single currency in accordance with the Treaty establishing the European Community as amended. | |||
Interest Accrual Period means the period beginning on (and including) the Interest Commencement Date and ending on (but excluding) the first Interest Period Date and each successive period beginning on (and including) an Interest Period Date and ending on (but excluding) the next succeeding Interest Period Date. |
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Interest Amount means: |
(i) | in respect of an Interest Accrual Period, the amount of interest payable per Calculation Amount for that Interest Accrual Period and which, in the case of Fixed Rate Instruments, and unless otherwise specified hereon, shall mean the Fixed Coupon Amount or Broken Amount specified hereon as being payable on the Interest Payment Date ending the Interest Period of which such Interest Accrual Period forms part; and | ||
(ii) | in respect of any other period, the amount of interest payable per Calculation Amount for that period. |
Interest Commencement Date means the Issue Date or such other date as may be specified in the relevant Final Terms. | |||
Interest Determination Date means, with respect to a Rate of Interest and Interest Accrual Period, the date specified as such in the relevant Final Terms or, if none is so specified, (i) the first day of such Interest Accrual Period if the Specified Currency is Sterling or (ii) the day falling two Business Days in London prior to the first day of such Interest Accrual Period if the Specified Currency is neither Sterling nor euro or (iii) the day falling two TARGET Business Days prior to the first day of such Interest Accrual Period if the Specified Currency is euro. | |||
Interest Payment Date means the date or dates specified as such in, or determined in accordance with the provisions of, the relevant Final Terms and, if a Business Day Convention is specified in the relevant Final Terms, as the same may be adjusted in accordance with the relevant Business Day Convention. | |||
Interest Period means the period beginning on (and including) the Interest Commencement Date and ending on (but excluding) the first Interest Payment Date and each successive period beginning on (and including) an Interest Payment Date and ending on (but excluding) the next succeeding Interest Payment Date. | |||
Interest Period Date means each Interest Payment Date unless otherwise specified in the relevant Final Terms. | |||
ISDA Definitions means the 2006 ISDA Definitions as published by the International Swaps and Derivatives Association, Inc., unless otherwise specified in the relevant Final Terms. | |||
Page means such page, section, caption, column or other part of a particular information service (including, but not limited to, the Reuters Market 3000 ( Reuters )) as may be specified for the purpose of providing a Relevant Rate, or such other page, section, caption, column or other part as may replace it on that information service or on such other information service, in each case as may be nominated by the person or organisation providing or sponsoring the information appearing there for the purpose of displaying rates or prices comparable to that Relevant Rate. | |||
Rate of Interest means the rate of interest payable from time to time in respect of this Instrument and that is either specified, or calculated in accordance with the provisions, in the relevant Final Terms. | |||
Redemption Amount means, as appropriate, the Final Redemption Amount, the Early Redemption Amount (Tax), the Optional Redemption Amount (Call), the Optional Redemption Amount (Put), the Early Termination Amount or such other amount in the nature of a redemption amount as may be specified in, or determined in accordance with the provisions of the relevant Final Terms. |
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Reference Banks means the institutions specified as such in the relevant Final Terms or, if none, five leading banks selected by the Calculation Agent in the interbank market (or, if appropriate, money, swap or over-the-counter index options market) that is most closely connected with the Benchmark (which, if EURIBOR is the relevant Benchmark, shall be Europe). | |||
Relevant Financial Centre means, with respect to any Floating Rate to be determined in accordance with a Screen Rate Determination on an Interest Determination Date, the financial centre as may be specified as such in the relevant Final Terms or, if none is so specified, the financial centre with which the relevant Benchmark is most closely connected (which, in the case of EURIBOR, shall be Europe) or, if none is so connected, London. | |||
Relevant Rate means the Benchmark for a Representative Amount of the Specified Currency for a period (if applicable or appropriate to the Benchmark) equal to the Specified Duration commencing on the Effective Date. | |||
Relevant Time means, with respect to any Interest Determination Date, the local time in the Relevant Financial Centre specified in the relevant Final Terms or, if no time is specified, the local time in the Relevant Financial Centre at which it is customary to determine bid and offered rates in respect of deposits in the Specified Currency in the interbank market in the Relevant Financial Centre or, if no such customary local time exists, 11.00 hours in the Relevant Financial Centre and, for the purpose of this definition local time means, with respect to Europe as a Relevant Financial Centre, Brussels time. | |||
Representative Amount means, with respect to any Floating Rate to be determined in accordance with a Screen Rate Determination on an Interest Determination Date, the amount specified as such in the relevant Final Terms or, if none is specified, an amount that is representative for a single transaction in the relevant market at the time. | |||
Specified Currency means the currency specified as such in the relevant Final Terms or, if none is specified, the currency in which the Instruments are denominated. | |||
Specified Duration means, with respect to any Floating Rate to be determined in accordance with a Screen Rate Determination on an Interest Determination Date, the duration specified in the relevant Final Terms or, if none is specified, a period of time equal to the relevant Interest Accrual Period, ignoring any adjustment pursuant to Condition 3.2.2. | |||
TARGET System means the Trans-European Automated Real-Time Gross Settlement Express Transfer (known as TARGET2) System which was launched on 19 November 2007 or any successor to it. | |||
(j) | Calculation Agent and Reference Banks | ||
The Issuer[, failing whom the Guarantor,]* shall procure that there shall at all times be four Reference Banks (or such other number as may be required) with offices in the Relevant Financial Centre and one or more Calculation Agents if provision is made for them in the relevant Final Terms and for so long as any Instrument is outstanding. If any Reference Bank (acting through its relevant office) is unable or unwilling to continue to act as a Reference Bank, then the Issuer[ or the Guarantor]* shall (with the prior approval of the Trustee) appoint another Reference Bank with an office in the Relevant Financial Centre to act as such in its place. Where more than one Calculation Agent is appointed in respect of the Instruments, references in these |
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Conditions to the Calculation Agent shall be construed as each Calculation Agent performing its respective duties under these Conditions. If the Calculation Agent is unable or unwilling to act as such or if the Calculation Agent fails duly to establish the Rate of Interest for an Interest Period or Interest Accrual Period or to calculate any Interest Amount, Instalment Amount, Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount, as the case may be, or to comply with any other requirement, the Issuer [or the Guarantor]* shall (with the prior approval of the Trustee) appoint a leading bank or investment banking firm engaged in the interbank market (or, if appropriate, money, swap or over-the-counter index options market) which is most closely connected with the calculation or determination to be made by the Calculation Agent (acting through its principal London office or any other office actively involved in such market) to act as such in its place. The Calculation Agent may not resign its duties without a successor having been appointed as specified in this paragraph. |
4 | Indexation | |
This Condition 4 is applicable only if the relevant Final Terms specifies the Instruments as Index Linked Instruments. | ||
Where the RPI (as defined below) is specified as the Index or Index Figure (each as defined below) in the relevant Final Terms, the following Conditions 4.1 to 4.6 will apply: |
4.1 | Definitions | ||
Base Index Figure means (subject to Condition 4.3(i)) the base index figure as specified in the relevant Final Terms; | |||
Index or Index Figure means, subject as provided in Condition 4.3(i), the UK Retail Price Index ( RPI ) (for all items) published by the Office for National Statistics (January 1987 = 100) or any comparable index which may replace the RPI for the purpose of calculating the amount payable on repayment of the Reference Gilt. Any reference to the Index Figure which is specified in the relevant Final Terms as: |
(i) | applicable to a particular month, shall, subject as provided in Conditions 4.3 and 4.5, be construed as a reference to the Index Figure published in the seventh month prior to that particular month and relating to the month before that of publication; or | ||
(ii) | applicable to the first calendar day of any month shall, subject as provided in Conditions 4.3 and 4.5, be construed as a reference to the Index Figure published in the second month prior to that particular month and relating to the month before that of publication; or | ||
(iii) | applicable to any other day in any month shall, subject as provided in Conditions 4.3 and 4.5, be calculated by linear interpolation between (x) the Index Figure applicable to the first calendar day of the month in which the day falls, calculated as specified in sub-paragraph (ii) above and (y) the Index Figure applicable to the first calendar day of the month following, calculated as specified in sub-paragraph (ii) above and rounded to the nearest fifth decimal place. |
If the Index is replaced, the Issuer will describe the replacement Index in a supplement to the Prospectus; | |||
Index Ratio applicable to any month or date, as the case may be, means the Index Figure applicable to such month or date, as the case may be, divided by the Base Index Figure and rounded to the nearest fifth decimal place; | |||
Limited Index Ratio means (a) in respect of any month or date, as the case may be, prior to the relevant Issue Date, the Index Ratio for that month or date, as the case may be, (b) in respect of |
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any Limited Indexation Date after the relevant Issue Date, the product of the Limited Indexation Factor for that month or date, as the case may be, and the Limited Index Ratio as previously calculated in respect of the month or date, as the case may be, twelve months prior thereto; and (c) in respect of any other month, the Limited Index Ratio as previously calculated in respect of the most recent Limited Indexation Month; | |||
Limited Indexation Date means any date falling during the period specified in the relevant Final Terms for which a Limited Indexation Factor is to be calculated; | |||
Limited Indexation Factor means, in respect of a Limited Indexation Month or Limited Indexation Date, as the case may be, the ratio of the Index Figure applicable to that month or date, as the case may be, divided by the Index Figure applicable to the month or date, as the case may be, twelve months prior thereto, provided that (a) if such ratio is greater than the Maximum Indexation Factor specified in the relevant Final Terms, it shall be deemed to be equal to such Maximum Indexation Factor and (b) if such ratio is less than the Minimum Indexation Factor specified in the relevant Final Terms, it shall be deemed to be equal to such Minimum Indexation Factor; | |||
Limited Indexation Month means any month specified in the relevant Final Terms for which a Limited Indexation Factor is to be calculated; | |||
Limited Index Linked Instruments means Index Linked Instruments to which a Maximum Indexation Factor and/or a Minimum Indexation Factor (as specified in the relevant Final Terms) applies; and | |||
Reference Gilt means the Treasury Stock specified as such in the relevant Final Terms for so long as such stock is in issue, and thereafter such issue of index-linked Treasury Stock determined to be appropriate by a gilt-edged market maker or other adviser selected by the Issuer[ or the Guarantor]* (an Indexation Adviser ). |
4.2 | Application of the Index Ratio | ||
Each payment of interest and principal in respect of the Instruments shall be the amount provided in, or determined in accordance with, these Conditions, multiplied by the Index Ratio or Limited Index Ratio in the case of Limited Index Linked Instruments applicable to the month or date, as the case may be, on which such payment falls to be made and rounded in accordance with Condition 3.2.4(e). | |||
4.3 | Changes in Circumstances Affecting the Index |
(i) | Change in base: If at any time and from time to time the Index is changed by the substitution of a new base therefor, then with effect from the month from and including that in which such substitution takes effect or the first date from and including that on which such substitution takes effect, as the case may be, (1) the definition of Index and Index Figure in Condition 4.1 shall be deemed to refer to the new date or month in substitution for January 1987 (or, as the case may be, to such other date or month as may have been substituted therefor), and (2) the new Base Index Figure shall be the product of the existing Base Index Figure and the Index Figure for the date on which such substitution takes effect, divided by the Index Figure for the date immediately preceding the date on which such substitution takes effect. | ||
(ii) | Delay in publication of Index if sub-paragraph (i) of the definition of Index Figure is applicable: If the Index Figure which is normally published in the seventh month and which relates to the eighth month (the relevant month ) before the month in which a payment is due to be made is not published on or before the fourteenth business day before the date on which such payment is due (the date for payment ), the Index Figure applicable to the month in which the date for payment falls shall be (1) such substitute index figure (if any) as |
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the Trustee considers (acting solely on the advice of the Indexation Adviser) to have been published by the United Kingdom Debt Management Office or the Bank of England, as the case may be, for the purposes of indexation of payments on the Reference Gilt or, failing such publication, on any one or more issues of index-linked Treasury Stock selected by an Indexation Adviser (and approved by the Trustee (acting solely on the advice of the Indexation Adviser)) or (2) if no such determination is made by such Indexation Adviser within seven days, the Index Figure last published (or, if later, the substitute index figure last determined pursuant to Condition 4.3(i)) before the date for payment. |
(iii) | Delay in publication of Index if sub-paragraph (ii) and/or (iii) of the definition of Index Figure is applicable: If the Index Figure relating to any month (the calculation month ) which is required to be taken into account for the purposes of the determination of the Index Figure for any date is not published on or before the fourteenth business day before the date on which such payment is due (the date for payment ), the Index Figure applicable for the relevant calculation month shall be (1) such substitute index figure (if any) as the Trustee considers (acting solely on the advice of the Indexation Adviser) to have been published by the United Kingdom Debt Management Office or the Bank of England, as the case may be, for the purposes of indexation of payments on the Reference Gilt or, failing such publication, on any one or more issues of index-linked Treasury Stock selected by an Indexation Adviser (and approved by the Trustee (acting solely on the advice of the Indexation Adviser)) or (2) if no such determination is made by such Indexation Adviser within seven days, the Index Figure last published (or, if later, the substitute index figure last determined pursuant to Condition 4.3(i)) before the date for payment. |
4.4 | Application of Changes | ||
Where the provisions of Condition 4.3(ii) or Condition 4.3(iii) apply, the determination of the Indexation Adviser as to the Index Figure applicable to the month in which the date for payment falls or the date for payment, as the case may be, shall be conclusive and binding. If, an Index Figure having been applied pursuant to Condition 4.3(ii)(2) or Condition 4.3(iii)(2), the Index Figure relating to the relevant month or relevant calculation month, as the case may be, is subsequently published while an Instrument is still outstanding, then: |
(i) | in relation to a payment of principal or interest in respect of such Instrument other than upon final redemption of such Instrument, the principal or interest (as the case may be) next payable after the date of such subsequent publication shall be increased or reduced, as the case may be, by an amount equal to the shortfall or excess, as the case may be, of the amount of the relevant payment made on the basis of the Index Figure applicable by virtue of Condition 4.3(ii)(2) or Condition 4.3(iii)(2) below or above the amount of the relevant payment that would have been due if the Index Figure subsequently published had been published on or before the fourteenth business day before the date for payment; and | ||
(ii) | in relation to a payment of principal or interest upon final redemption, no subsequent adjustment to amounts paid will be made. |
4.5 | Cessation of or Fundamental Changes to the Index |
(i) | If (1) the Trustee and the Issuer [and the Guarantor]* have been notified by the Calculation Agent that the Index has ceased to be published or (2) any change is made to the coverage or the basic calculation of the Index which constitutes a fundamental change which would, in the opinion of (A) the Issuer be materially prejudicial to the interests of the Issuer,[ or the Guarantor]* or (B) the Trustee acting solely on the advice of an Indexation Adviser, be materially prejudicial to the interests of the Instrumentholders, the Trustee will give written notice of such occurrence to the Issuer in the case of (B), and the Issuer[, the Guarantor]* and the Trustee (acting solely on the advice of the Indexation Adviser) together shall seek to agree for the purpose of the Instruments one or more adjustments to the Index or a |
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substitute index (with or without adjustments) with the intention that the same should leave the Issuer[, the Guarantor]* and the Instrumentholders in no better and no worse position than they would have been had the Index not ceased to be published or the relevant fundamental change not been made. |
(ii) | If the Issuer[, the Guarantor]* and the Trustee (acting solely on the advice of the Indexation Adviser) fail to reach agreement as mentioned above within 20 business days following the giving of notice as mentioned in paragraph (i), a bank or other person in London shall be appointed by the Issuer[, the Guarantor]* and the Trustee or, failing agreement on and the making of such appointment within 20 business days following the expiry of the 20 day period referred to above, by the Trustee (acting solely on the advice of the Indexation Adviser) (in each case, such bank or other person so appointed being referred to as the Expert ), to determine for the purpose of the Instruments one or more adjustments to the Index or a substitute index (with or without adjustments) with the intention that the same should leave the Issuer[, the Guarantor]* and the Instrumentholders in no better and no worse position than they would have been had the Index not ceased to be published or the relevant fundamental change not been made. Any Expert so appointed shall act as an expert and not as an arbitrator and all fees, costs and expenses of the Expert and of any Indexation Adviser and of any of the Issuer[, the Guarantor]* and the Trustee in connection with such appointment shall be borne by the Issuer[ or the Guarantor]*. | ||
(iii) | The Index shall be adjusted or replaced by a substitute index as agreed by the Issuer[, the Guarantor]* and the Trustee (acting solely on the advice of the Indexation Adviser) or as determined by the Expert pursuant to the foregoing paragraphs, as the case may be, and references in these Conditions to the Index and to any Index Figure shall be deemed amended in such manner as the Trustee (acting solely on the advice of the Indexation Adviser)[, the Guarantor]* and the Issuer agree are appropriate to give effect to such adjustment or replacement. Such amendments shall be effective from the date of such notification and binding upon the Issuer,[ the Guarantor and]* the Trustee and the Instrumentholders, and the Issuer [and the Guarantor]* shall give notice to the Instrumentholders in accordance with Condition 14 of such amendments as promptly as practicable following such notification. |
4.6 | Redemption for Index Reasons | ||
If either (i) the Index Figure for three consecutive months is required to be determined on the basis of an Index Figure previously published as provided in Condition 4.3(ii)(2) and the Trustee has been notified by the Calculation Agent that publication of the Index has ceased or (ii) notice is published by Her Majestys Treasury, or on its behalf, following a change in relation to the Index, offering a right of redemption to the holders of the Reference Gilt, and (in either case) no amendment or substitution of the Index shall have been advised by the Indexation Adviser to the Issuer [and the Guarantor]* and such circumstances are continuing, the Issuer may, upon giving not more than 60 nor less than 30 days notice to the Instrumentholders in accordance with Condition 14, redeem all, but not some only, of the Instruments at their principal amount together with interest accrued but unpaid up to and including the date of redemption (in each case adjusted in accordance with Condition 4.2). |
Where HICP (as defined below) is specified as the Index or Index Level (each as defined below) in the relevant Final Terms, the following Conditions 4.7 to 4.10 will apply: |
4.7 | Definitions | ||
Base Index Level means the base index level as specified in the relevant Final Terms; | |||
Index or Index Level means (subject as provided in Condition 4.9) the Non-revised Index of Consumer Prices excluding tobacco or relevant Successor Index (as defined in Condition 4.9(i)), |
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measuring the rate of inflation in the European Monetary Union excluding tobacco, expressed as an index and published by Eurostat (the HICP ). The first publication or announcement of a level of such index for a calculation month (as defined in Condition 4.9(i)) shall be final and conclusive and later revisions to the level for such calculation month will not be used in any calculations. Any reference to the Index Level which is specified in these Conditions as applicable to any day ( d ) in any month ( m ) shall, subject as provided in Condition 4.9, be calculated as follows: |
I d = HICP m-3 + |
nbd
q m |
x (HICP m-2 HICP m-3 ) |
where: | |||
I d is the Index Level for the day d | |||
HICP m-2 is HICP for month m-2 | |||
HICP m-3 is HICP for month m-3 | |||
nbd is the actual number of days from and excluding the first day of month m to but including day d; and | |||
q m is the actual number of days in month m, | |||
provided that if Condition 4.9 applies, the Index Level shall be the Substitute Index Level determined in accordance with such Condition. | |||
If the Index is replaced, the Issuer will describe the replacement Index in a supplement to the Prospectus; | |||
Index Business Day means a day on which the TARGET System is operating; | |||
Index Determination Date means in respect of any date for which the Index Level is required to be determined, the fifth Index Business Day prior to such date; | |||
Index Ratio applicable to any date means the Index Level applicable to the relevant Index Determination Date divided by the Base Index Level and rounded to the nearest fifth decimal place, 0.000005 being rounded upwards; and | |||
Related Instrument means an inflation-linked bond selected by the Calculation Agent that is a debt obligation of one of the governments (but not any government agency) of France, Italy, Germany or Spain and which pays a coupon or redemption amount which is calculated by reference to the level of inflation in the European Monetary Union with a maturity date which falls on (a) the same day as the Maturity Date, (b) the next longest maturity date after the Maturity Date if there is no such bond maturing on the Maturity Date, or (c) the next shortest maturity before the Maturity Date if no bond defined in (a) or (b) is selected by the Calculation Agent. The Calculation Agent will select the Related Instrument from such of those inflation-linked bonds issued on or before the relevant Issue Date and, if there is more than one such inflation-linked bond maturing on the same date, the Related Instrument shall be selected by the Calculation Agent from such of those bonds. If the Related Instrument is redeemed, the Calculation Agent will select a new Related Instrument on the same basis, but selected from all eligible bonds in issue at the time the originally selected Related Instrument is redeemed (including any bond for which the redeemed originally selected Related Instrument is exchanged). | |||
4.8 | Application of the Index Ratio | ||
Each payment of interest and principal in respect of the Instruments shall be the amount provided in, or determined in accordance with, these Conditions, multiplied by the Index Ratio applicable to the date on which such payment falls to be made and rounded in accordance with Condition 3.2.4(e). |
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4.9 | Changes in Circumstances Affecting the Index |
(i) | Delay in publication of Index: |
(a) | If the Index Level relating to any month (the calculation month ) which is required to be taken into account for the purposes of the determination of the Index Level for any date (the Relevant Level ) has not been published or announced by the day that is five Business Days before the date on which such payment is due (the Affected Payment Date ), the Calculation Agent shall determine a Substitute Index Level (as defined below) (in place of such Relevant Level) by using the following methodology: |
(1) | if applicable, the Calculation Agent will take the same action to determine the Substitute Index Level for the Affected Payment Date as that taken by the calculation agent (or any other party performing the function of a calculation agent (whatever such partys title)) pursuant to the terms and conditions of the Related Instrument; | ||
(2) | if (1) above does not result in a Substitute Index Level for the Affected Payment Date for any reason, then the Calculation Agent shall determine the Substitute Index Level as follows: | ||
Substitute Index Level = Base Level x (Latest Level / Reference Level) | |||
where: | |||
Base Level means the level of the Index (excluding any flash estimates) published or announced by Eurostat (or any successor entity which publishes such index) in respect of the month which is 12 calendar months prior to the month for which the Substitute Index Level is being determined; | |||
Latest Level means the latest level of the Index (excluding any flash estimates) published or announced by Eurostat (or any successor entity which publishes such index) prior to the month in respect of which the Substitute Index Level is being calculated; and | |||
Reference Level means the level of the Index (excluding any flash estimates) published or announced by Eurostat (or any successor entity which publishes such index) in respect of the month that is 12 calendar months prior to the month referred to in Latest Level above. |
(b) | If a Relevant Level is published or announced at any time after the day that is five Business Days prior to the next Interest Payment Date, such Relevant Level will not be used in any calculations. The Substitute Index Level so determined pursuant to this Condition 4.9(i) will be the definitive level for that calculation month. |
(ii) | Cessation of publication: If the Index Level has not been published or announced for two consecutive months or Eurostat announces that it will no longer continue to publish or announce the Index, then the Calculation Agent shall determine a successor index in lieu of any previously applicable Index (the Successor Index ) by using the following methodology: |
(a) | if at any time (other than after an Early Termination Event (as defined below) has been designated by the Calculation Agent pursuant to paragraph (e) below) a successor index has been designated by the calculation agent (or any other party performing the function of a calculation agent (whatever such partys title)) pursuant to the terms and conditions of the Related Instrument, such successor index shall be designated the Successor Index for the purposes of all subsequent Interest |
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Payment Dates, notwithstanding that any other Successor Index may previously have been determined under paragraphs (b), (c) or (d) below; or |
(b) | if a Successor Index has not been determined under paragraph (a) above (and there has been no designation of an Early Termination Event pursuant to paragraph (e) below), and a notice has been given or an announcement has been made by Eurostat (or any successor entity which publishes such index) specifying that the Index will be superseded by a replacement index specified by Eurostat (or any such successor), and the Calculation Agent determines that such replacement index is calculated using the same or substantially similar formula or method of calculation as used in the calculation of the previously applicable Index, such replacement index shall be the Index from the date that such replacement index comes into effect; or | ||
(c) | if a Successor Index has not been determined under paragraphs (a) or (b) above (and there has been no designation of an Early Termination Event pursuant to paragraph (e) below), the Calculation Agent shall ask five leading independent dealers to state what the replacement index for the Index should be. If between four and five responses are received, and of those four or five responses, three or more leading independent dealers state the same index, this index will be deemed the Successor Index . If three responses are received, and two or more leading independent dealers state the same index, this index will be deemed the Successor Index . If fewer than three responses are received, the Calculation Agent will proceed to paragraph (d) below; | ||
(d) | if no Successor Index has been determined under paragraphs (a), (b) or (c) above on or before the fifth Index Business Day prior to the next Affected Payment Date the Calculation Agent will determine an appropriate alternative index for such Affected Payment Date, and such index will be deemed the Successor Index ; | ||
(e) | if the Calculation Agent determines that there is no appropriate alternative index, the Issuer and the Instrumentholders shall, in conjunction with the Calculation Agent, determine an appropriate alternative index. If the Issuer and the Instrumentholders, in conjunction with the Calculation Agent, do not reach agreement on an appropriate alternative index within a period of ten Business Days, then an Early Termination Event will be deemed to have occurred and the Issuer will redeem the Instruments pursuant to Condition 4.10. |
(iii) | Rebasing of the Index: If the Calculation Agent determines that the Index has been or will be rebased at any time, the Index as so rebased (the Rebased Index ) will be used for the purposes of determining each relevant Index Level from the date of such rebasing; provided, however, that the Calculation Agent shall make such adjustments as are made by the calculation agent (or any other party performing the function of a calculation agent (whatever such partys title)) pursuant to the terms and conditions of the Related Instrument to the levels of the Rebased Index so that the Rebased Index levels reflect the same rate of inflation as the Index before it was rebased. Any such rebasing shall not affect any prior payments made. | ||
(iv) | Material Modification Prior to Interest Payment Date: If, on or prior to the day that is five Business Days before an Interest Payment Date, Eurostat announces that it will make a material change to the Index then the Calculation Agent shall make any such adjustments to the Index consistent with adjustments made to the Related Instrument . | ||
(v) | Manifest Error in Publication: If, within thirty days of publication, the Calculation Agent determines that Eurostat (or any successor entity which publishes such index) has corrected the level of the Index to remedy a manifest error in its original publication, the Calculation Agent will notify the parties of (A) that correction, (B) the amount that is payable |
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as a result of that correction and (C) take such other action as it may deem necessary to give effect to such correction. |
4.10 | Redemption for Index Reasons | ||
If an Early Termination Event as described under Condition 4.9(ii)(e) is deemed to have occurred, the Issuer will, upon giving not more than 60 nor less than 30 days notice to the Instrumentholders in accordance with Condition 14, redeem all, but not some only, of the Instruments at their principal amount together with interest accrued but unpaid up to and including the date of redemption (in each case adjusted in accordance with Condition 4.8). |
5 | Redemption, Purchase and Options |
5.1 | Final Redemption | ||
Unless previously redeemed, purchased and cancelled as provided below, this Instrument will be redeemed at its Final Redemption Amount (which, unless otherwise provided, is its nominal amount) on the Maturity Date specified in the relevant Final Terms provided, however, that if this Instrument is a Perpetual Instrument it will only be redeemable and repayable in accordance with the following provisions of this Condition 5. | |||
5.2 | Redemption for Taxation Reasons | ||
If, on the occasion of the next payment in respect of the Instruments, the Issuer [(or, if the Guarantee were called, the Guarantor)]* satisfies the Trustee immediately before the giving of the notice referred to below that it would be unable to make such payment without having to pay additional amounts as described in Condition 7, and such requirement to pay such additional amounts arises by reason of a change in the laws of the United Kingdom or any political sub-division of the United Kingdom or taxing authority in the United Kingdom or any political sub-division of the United Kingdom or in the official interpretation or application of the laws of the United Kingdom or any political sub-division of the United Kingdom or in any applicable double taxation treaty or convention, which change becomes effective on or after the date on which agreement is reached to issue the first Tranche of the Instruments, and such requirement cannot be avoided by the Issuer [(or the Guarantor, as the case may be)]* taking reasonable measures (such measures not involving any material additional payments by, or expense for, the Issuer [(or the Guarantor, as the case may be)]*), the Issuer may, at its option, on any Interest Payment Date or, if so specified in the relevant Final Terms, at any time, having given not less than 30 nor more than 45 days notice to the Instrumentholders in accordance with Condition 14, redeem all, but not some only, of the Instruments at their Early Redemption Amount together with interest accrued to the date of redemption, provided that the date fixed for redemption shall not be earlier than 90 days prior to the earliest date on which the Issuer [(or the Guarantor, as the case may be)]* would be obliged to pay such additional amounts or make such withholding or deduction, as the case may be, were a payment in respect of the Instruments [(or the Guarantee, as the case may be)]* then due. Prior to the publication of any notice of redemption pursuant to this Condition 5.2, the Issuer shall deliver to the Trustee a certificate signed by two Directors of the Issuer [(or the Guarantor, as the case may be)]* stating that the requirement referred to above cannot be avoided by the Issuer [(or the Guarantor, as the case may be)]* taking reasonable measures available to it and the Trustee shall be entitled to accept such certificate as sufficient evidence of the satisfaction of the condition precedent set out above in which event it shall be conclusive and binding on Instrumentholders and Couponholders. | |||
5.3 | Purchases | ||
The Issuer[, the Guarantor]* and any of [its/their] subsidiary undertakings may at any time purchase Instruments (provided that all unmatured Receipts and Coupons and unexchanged |
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Talons appertaining to them are attached or surrendered with them) in the open market or otherwise at any price. |
5.4 | Early Redemption |
5.4.1 | Zero Coupon Instruments: |
(a) | The Early Redemption Amount payable in respect of any Zero Coupon Instrument, the Early Redemption Amount of which is not linked to an index and/or a formula, upon redemption of such Instrument pursuant to Condition 5.2 or upon it becoming due and payable as provided in Condition 9 shall be the Amortised Face Amount (calculated as provided below) of such Instrument unless otherwise specified in the relevant Final Terms. | ||
(b) | Subject to the provisions of sub-paragraph (c) below, the Amortised Face Amount of any such Instrument shall be the scheduled Final Redemption Amount of such Instrument on the Maturity Date discounted at a rate per annum (expressed as a percentage) equal to the Amortisation Yield (which, if none is specified in the relevant Final Terms, shall be such rate as would produce an Amortised Face Amount equal to the issue price of the Instruments if they were discounted back to their issue price on the Issue Date) compounded annually. | ||
(c) | If the Early Redemption Amount payable in respect of any such Instrument, upon its redemption pursuant to Condition 5.2 or, if applicable, Condition 5.5 or 5.6 or upon it becoming due and payable as provided in Condition 9, is not paid when due, the Early Redemption Amount due and payable in respect of such Instrument shall be the Amortised Face Amount of such Instrument as defined in sub-paragraph (b) above, except that such sub-paragraph shall have effect as though the reference in that sub-paragraph to the date on which the Instrument becomes due and payable was replaced by a reference to the Relevant Date as defined in Condition 7. The calculation of the Amortised Face Amount in accordance with this sub-paragraph shall continue to be made (as well after as before judgment) until the Relevant Date, unless the Relevant Date falls on or after the Maturity Date, in which case the amount due and payable shall be the scheduled Final Redemption Amount of such Instrument on the Maturity Date together with any interest that may accrue in accordance with Condition 3.2. |
Where such calculation is to be made for a period of less than one year, it shall be made on the basis of the Day Count Fraction specified in the relevant Final Terms. | |||
5.4.2 | Other Instruments | ||
The Early Redemption Amount payable in respect of any Instrument (other than Instruments described in Condition 5.4.1 above), upon redemption of such Instrument pursuant to this Condition 5.4 or upon it becoming due and payable as provided in Condition 9, shall be the Final Redemption Amount unless otherwise specified in the relevant Final Terms. |
5.5 | Redemption at the Option of the Issuer and Exercise of Issuers Options |
5.5.1 | Residual Holding Call Option | ||
If (i) Residual Holding Call Option is specified in the relevant Final Terms as applicable, and (ii) if at any time the Residual Holding Percentage or more of the aggregate nominal amount of Instruments originally issued shall have been redeemed or purchased and cancelled, the Issuer shall have the option to redeem such outstanding Instruments in whole, but not in part, at their Residual Holding Redemption Amount. Unless otherwise specified in the relevant Final Terms, the Residual Holding Redemption Amount will be |
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calculated by the Calculation Agent by discounting the outstanding nominal amount of the Instruments and the remaining interest payments (if applicable) to the Maturity Date by a rate per annum (expressed as a percentage to the nearest one hundred thousandth of a percentage point (with halves being rounded up)) equal to the Benchmark Yield, being the yield on the Benchmark Security at the close of business on the third Business Day prior to the date fixed for such redemption, plus the Benchmark Spread. Where the specified calculation is to be made for a period of less than one year, it shall be calculated using the Benchmark Day Count Fraction. The Issuer will give not less than 15 nor more than 30 days irrevocable notice to the Instrumentholders and the Trustee of any such redemption pursuant to this Condition 5.5.1. |
5.5.2 | Call Option | ||
If Call Option is specified in the relevant Final Terms as applicable, the Issuer may, on giving not less than 15 nor more than 30 days irrevocable notice to the Instrumentholders (or such other notice period as may be specified in the relevant Final Terms), redeem, or exercise any Issuers option in relation to, all or, if so provided, some of such Instruments on any Optional Redemption Date or Option Exercise Date, as the case may be. Any such redemption of Instruments shall be at their Optional Redemption Amount together with interest accrued to the date fixed for redemption. Any such redemption or exercise must relate to Instruments of a nominal amount at least equal to the minimum nominal amount (if any) to be redeemed specified hereon and no greater than the maximum nominal amount (if any) to be redeemed specified on this Instrument. | |||
All Instruments in respect of which any such notice is given shall be redeemed, or the Issuers option shall be exercised, on the date specified in such notice in accordance with this Condition. | |||
In the case of a partial redemption or a partial exercise of an Issuers option, the notice to Instrumentholders shall also contain the serial numbers of the Instruments to be redeemed, which shall have been drawn in such place as the Trustee may approve and in such manner as it deems appropriate, subject to compliance with any applicable laws, listing authority and stock exchange requirements. |
5.6 | Redemption at the Option of Instrumentholders and Exercise of Instrumentholders Options | ||
If Put Option is specified in the relevant Final Terms as applicable, the Issuer shall, at the option of the holder of any such Instrument, upon the holder of such Instrument giving not less than 15 nor more than 30 days notice to the Issuer (or such other notice period as may be specified on this Instrument) redeem such Instrument on the Optional Redemption Date(s) at its Optional Redemption Amount together with interest accrued to the date fixed for redemption. | |||
To exercise such option or any other Instrumentholders option which may be set out on this Instrument (which must be exercised on an Option Exercise Date) the holder must deposit such Instrument with any Paying Agent at its specified office, together with a duly completed option exercise notice ( Exercise Notice ) in the form obtainable from any Paying Agent within the Instrumentholders Option Period (as specified in the relevant Final Terms). No Instrument so deposited and option exercised may be withdrawn (except as provided in the Agency Agreement) without the prior consent of the Issuer. | |||
5.7 | Partly Paid Instruments | ||
Partly Paid Instruments will be redeemed, whether at maturity, early redemption or otherwise, in accordance with the provisions of this Condition and the provisions specified in the relevant Final Terms. |
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5.8 | Redemption by Instalments | ||
Unless previously redeemed, purchased and cancelled as provided in this Condition 5, each Instrument which provides for Instalment Dates and Instalment Amounts will be partially redeemed on each Instalment Date at the Instalment Amount specified in the relevant Final Terms. The outstanding nominal amount of each such Instrument shall be reduced by the Instalment Amount (or, if such Instalment Amount is calculated by reference to a proportion of the nominal amount of such Instrument, such proportion) for all purposes with effect from the related Instalment Date, unless payment of the Instalment Amount is improperly withheld or refused on presentation of the related Receipt, in which case, such amount shall remain outstanding until the Relevant Date relating to such Instalment Amount. | |||
5.9 | Cancellation | ||
All Instruments redeemed pursuant to any of the foregoing provisions will be cancelled forthwith (together with all unmatured Receipts and Coupons and unexchanged Talons attached thereto). All Instruments purchased by or on behalf of the Issuer [, the Guarantor]* or any of [its/their] subsidiary undertakings may, at the option of the Issuer, be held by or may be surrendered together with all unmatured Receipts and Coupons and all unexchanged Talons attached to them to a Paying Agent for cancellation, but may not be resold and when held by the Issuer [, the Guarantor]* or any of [its/their] respective subsidiary undertakings shall not entitle the holder to vote at any meeting of Instrumentholders and shall not be deemed to be outstanding for the purposes of calculating quorums at meetings of Instrumentholders or for the purposes of Condition 11. |
6 | Payments and Talons |
6.1 | Payments | ||
Payments of principal and interest in respect of Instruments will, subject as mentioned below, be made against presentation and surrender of the relevant Receipts (in the case of payments of Instalment Amounts other than on the due date for redemption and provided that the Receipt is presented for payment together with its relative Instrument), Instruments (in the case of all other payments of principal and, in the case of interest, as specified in Condition 6.5.6) or Coupons (in the case of interest, save as specified in Condition 6.5.6), as the case may be, at the specified office of any Paying Agent outside the United States by a cheque payable in the currency in which such payment is due drawn on, or, at the option of the holder, by transfer to an account denominated in that currency with, a bank in the principal financial centre for that currency; provided that in the case of euro, the transfer shall be in a city in which banks have access to the TARGET System. | |||
6.2 | Payments in the United States | ||
Notwithstanding the above, if any Instruments are denominated in U.S. dollars, payments in respect of them may be made at the specified office of any Paying Agent in New York City in the same manner as specified above if (a) the Issuer shall have appointed Paying Agents with specified offices outside the United States with the reasonable expectation that such Paying Agents would be able to make payment of the amounts on the Instruments in the manner provided above when due, (b) payment in full of such amounts at all such offices is illegal or effectively precluded by exchange controls or other similar restrictions on payment or receipt of such amounts and (c) such payment is then permitted by United States law, without involving, in the opinion of the Issuer, any adverse tax consequence to the Issuer. |
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6.3 | Payments subject to Fiscal Laws etc. | ||
All payments are subject in all cases to any applicable fiscal or other laws, regulations and directives, but without prejudice to the provisions of Condition 7. No commission or expenses shall be charged to the Instrumentholders or Couponholders in respect of such payments. | |||
6.4 | Appointment of Agents | ||
The Issuing and Paying Agent, the Paying Agents and the Calculation Agent initially appointed by the Issuer [and the Guarantor]* and their respective specified offices are listed below. The Issuing and Paying Agent, the Paying Agents and the Calculation Agent act solely as agents of the Issuer [and the Guarantor]* and do not assume any obligation or relationship of agency or trust for or with any holder. The Issuer [and the Guarantor]* reserve[s] the right at any time with the approval of the Trustee to vary or terminate the appointment of the Issuing and Paying Agent, any other Paying Agent or the Calculation Agent and to appoint additional or other Paying Agents, provided that the Issuer shall at all times maintain (i) an Issuing and Paying Agent, (ii) a Paying Agent having a specified office in a continental European city, (iii) a Calculation Agent where the Conditions so require one, (iv) so long as the Instruments are listed on any stock exchange or admitted to listing by any other relevant authority, a Paying Agent having a specified office in such place as may be required by the rules and regulations of the relevant stock exchange or other relevant authority and (v) to the extent that the Issuer is able to do so and not provided for by the foregoing provisions of this Condition 6.4, a Paying Agent with a specified office in a European Union Member State that will not be obliged to withhold or deduct tax pursuant to European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of 26-27 November 2000 or any law implementing or complying with, or introduced in order to conform to, such Directive. As used in these Conditions, the terms Issuing and Paying Agent , Calculation Agent , and Paying Agent include any additional or replacement Issuing and Paying Agent, Calculation Agent or Paying Agent appointed under this Condition. | |||
In addition, the Issuer [and the Guarantor]* shall forthwith appoint a Paying Agent in New York City in respect of any Instruments denominated in U.S. dollars in the circumstances described in Condition 6.2. | |||
Notice of any such change or any change of any specified office shall promptly be given to the Instrumentholders in accordance with Condition 14. | |||
6.5 | Unmatured Coupons and Receipts and unexchanged Talons: |
6.5.1 | Unless the Instrument provides that the relevant Coupons are to become void upon the due date for redemption of those Instruments, Instruments should be surrendered for payment together with all unmatured Coupons (if any) appertaining to them, failing which an amount equal to the face value of each missing unmatured Coupon (or, in the case of payment not being made in full, that proportion of the amount of such missing unmatured Coupon that the sum of principal so paid bears to the total principal due) will be deducted from the Final Redemption Amount, Early Redemption Amount or Optional Redemption Amount, as the case may be, due for payment. Any amount so deducted shall be paid in the manner mentioned above against surrender of such missing Coupon within a period of 10 years from the Relevant Date for the payment of such principal (whether or not such Coupon has become void pursuant to Condition 8). | ||
6.5.2 | If the relevant Instrument so provides, upon the due date for redemption of any Instrument, unmatured Coupons relating to such Instrument (whether or not attached) shall become void and no payment shall be made in respect of them. |
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6.5.3 | If the relevant Instrument so provides, upon the due date for redemption of any Instrument, any unexchanged Talon relating to such Instrument (whether or not attached) shall become void and no Coupon shall be delivered in respect of such Talon. | ||
6.5.4 | Upon the due date for redemption of any Instrument which is redeemable in instalments, all Receipts relating to such Instrument having an Instalment Date falling on or after such due date (whether or not attached) shall become void and no payment shall be made in respect of them. | ||
6.5.5 | Where any Instrument which provides that the relevant Coupons are to become void upon the due date for redemption of those Instruments is presented for redemption without all unmatured Coupons and any unexchanged Talon relating to it, and where any Instrument is presented for redemption without any unexchanged Talon relating to it, redemption shall be made only against the provision of such indemnity as the Issuer may require. | ||
6.5.6 | If the due date for redemption of any Instrument is not a due date for payment of interest, interest accrued from the preceding due date for payment of interest or the Interest Commencement Date, as the case may be, shall only be payable against presentation (and surrender if appropriate) of the relevant Instrument. Interest accrued on an Instrument that only bears interest after its Maturity Date shall be payable on redemption of that Instrument against presentation of that Instrument. |
6.6 | Non-business days | ||
If any date for payment in respect of any Instrument, Receipt or Coupon is not a business day, the holder shall not be entitled to payment until the next following business day nor to any interest or other sum in respect of such postponed payment. In this paragraph, business day means a day (other than a Saturday or a Sunday) on which banks and foreign exchange markets are open for business in the relevant place of presentation, in such jurisdictions as shall be specified as Financial Centres in the relevant Final Terms and: |
(i) | (in the case of a payment in a currency other than euro) where payment is to be made by transfer to an account maintained with a bank in the relevant currency, on which foreign exchange transactions may be carried on in the relevant currency in the principal financial centre of the country of such currency; or | ||
(ii) | (in the case of a payment in euro), which is a TARGET Business Day. |
6.7 | Talons | ||
On or after the Interest Payment Date for the final Coupon forming part of a Coupon sheet issued in respect of any Instrument, the Talon forming part of such Coupon sheet may be surrendered at the specified office of the Issuing and Paying Agent in exchange for a further Coupon sheet (but excluding any Coupons which may have become void pursuant to Condition 8). |
7 | Taxation | |
All payments of principal and interest by or on behalf of the Issuer [or the Guarantor]* in respect of the Instruments, the Receipts and the Coupons [or under the Guarantee]* will be made without withholding or deduction for or on account of, any present or future taxes or duties of whatever nature imposed or levied by or on behalf of the United Kingdom or any political sub-division of the United Kingdom or any authority in or of the United Kingdom having power to tax, unless such withholding or deduction is compelled by law. In that event, the Issuer [or, as the case may be, the Guarantor]* will pay such additional amounts of principal and interest as will result in the payment to the Instrumentholders, Receiptholders or, as the case may be, the Couponholders of the amounts which would otherwise have been receivable in respect of the Instruments, Receipts or Coupons had no withholding or deduction |
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been made, except that no such additional amounts shall be payable in respect of any Instrument, Receipt or Coupon presented for payment: |
(a) | by or on behalf of a person who is liable to such taxes or duties in respect of such Instrument, Receipt or Coupon by reason of his having some connection with the United Kingdom other than the mere holding of such Instrument, Receipt or Coupon; or | ||
(b) | by or on behalf of a person who would not be liable or subject to such deduction or withholding by making a declaration of non-residence or other claim for exemption to a tax authority; or | ||
(c) | more than 30 days after the Relevant Date except to the extent that the holder would have been entitled to such additional amounts on presenting the same for payment on such thirtieth day; or | ||
(d) | where such withholding or deduction is imposed on a payment to an individual and is required to be made pursuant to European Council Directive 2003/48/EC or any other Directive implementing the conclusions of the ECOFIN Council meeting of 26-27 November 2000 or any law implementing or complying with, or introduced in order to conform to, such Directive; or | ||
(e) | by or on behalf of a holder who would have been able to avoid such withholding or deduction (i) by presenting the relevant Instrument, Receipt or Coupon to another Paying Agent in a Member State of the European Union; or (ii) by satisfying any statutory or procedural requirements (including, without limitation, the provision of information). |
As used in these Conditions, Relevant Date in respect of any Instrument, Receipt or Coupon means the date on which payment in respect of it first becomes due or (if any amount of the money payable is improperly withheld or refused) the date on which payment in full of the amount outstanding is made or (if earlier) the date on which notice is duly given to the Instrumentholders in accordance with Condition 14 that, upon further presentation of the Instrument, Receipt or Coupon being made in accordance with the Conditions, such payment will be made, provided that payment is in fact made upon such presentation. References in these Conditions to (i) principal shall be deemed to include any premium payable in respect of the Instruments, all Instalment Amounts, Final Redemption Amounts, Early Redemption Amounts, Optional Redemption Amounts, Amortised Face Amounts and all other amounts in the nature of principal payable pursuant to Condition 5 or any amendment or supplement to it, (ii) interest shall be deemed to include all Interest Amounts and all other amounts payable pursuant to Condition 3 or any amendment or supplement to it or pursuant to Condition 6 or any amendment or supplement to it and (iii) principal and/or interest shall be deemed to include any additional amounts which may be payable under this Condition or any undertaking given in addition to or in substitution for it under the Trust Deed. | ||
8 | Prescription | |
Instruments, Receipts and Coupons (which, for this purpose, shall not include Talons) shall be prescribed and become void unless presented for payment within 10 years (in the case of principal) or five years (in the case of interest) from the appropriate Relevant Date in respect of them. | ||
9 | Events of Default | |
If any of the following events (each an Event of Default ) occurs and is continuing, the Trustee at its discretion may, and if so requested by the holders of at least one-quarter in nominal amount of the Instruments then outstanding or if so directed by an Extraordinary Resolution shall, give notice to the Issuer at its registered office that the Instruments are, and they shall accordingly immediately become due and repayable at their Redemption Amount together with accrued interest (if any) to the date of payment: |
(a) | Non-Payment : there is default for more than 30 days in the payment of any principal or interest due in respect of the Instruments; or |
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(b) | Breach of Other Obligations : there is default in the performance or observance by the Issuer [or the Guarantor]* of any other obligation or provision under the Trust Deed or the Instruments (other than any obligation for the payment of any principal or interest in respect of the Instruments) which default is incapable of remedy or, if in the opinion of the Trustee capable of remedy, is not remedied within 90 days after notice of such default shall have been given to the Issuer [or the Guarantor]* by the Trustee; or | ||
(c) | Winding-up : a resolution is passed, or a final order of a court in the United Kingdom is made and, where possible, not discharged or stayed within a period of 90 days, that the Issuer [or the Guarantor]* be wound up or dissolved; or | ||
(d) | Enforcement Proceedings : attachment is made of the whole or substantially the whole of the assets or undertaking of the Issuer [or the Guarantor]* and such attachment is not released or cancelled within 90 days or an encumbrancer takes possession or an administrative or other receiver or similar officer is appointed of the whole or substantially the whole of the assets or undertaking of the Issuer [or the Guarantor]* or an administration or similar order is made in relation to the Issuer [or the Guarantor]* and such taking of possession, appointment or order is not released, discharged or cancelled within 90 days; or | ||
(e) | Insolvency : the Issuer [or the Guarantor]* ceases to carry on all or substantially all of its business or is unable to pay its debts within the meaning of Section 123(1)(e) or Section 123(2) of the Insolvency Act 1986; or | ||
(f) | Bankruptcy : the Issuer [or the Guarantor]* is adjudged bankrupt or insolvent by a court of competent jurisdiction in its country of incorporation, |
provided that in the case of paragraph (b) the Trustee shall have certified that in its opinion such event is materially prejudicial to the interests of the Instrumentholders. | ||
Any such notice by the Trustee to the Issuer shall specify the serial number(s) of the Instrument(s) concerned. | ||
10 | Enforcement | |
The Trustee may, at its discretion and without further notice, institute such proceedings against the Issuer as it may think fit to enforce any obligation, condition or provision binding on the Issuer under the Instruments or under the Trust Deed, but shall not be bound to do so unless: |
(a) | it has been so directed by an Extraordinary Resolution or in writing by the holders of at least one-quarter of the principal amount of the Instruments outstanding; and | ||
(b) | it has been indemnified to its satisfaction. |
No Instrumentholder, Receiptholder or Couponholder shall be entitled to institute proceedings directly against the Issuer unless the Trustee, having become bound to proceed as specified above, fails to do so within a reasonable time and such failure is continuing. |
11 | Meetings of Instrumentholders, Modifications and Substitution |
11.1 | Meetings of Instrumentholders | ||
The Trust Deed contains provisions for convening meetings of Instrumentholders to consider any matter affecting their interests, including the sanctioning by Extraordinary Resolution (as defined in the Trust Deed) of a modification of any of these Conditions or any provisions of the Trust Deed. An Extraordinary Resolution duly passed at any such meeting shall be binding on Instrumentholders (whether or not they were present at the meeting at which such resolution was passed) and on all Couponholders, except that any Extraordinary Resolution proposed, inter alia , (i) to amend the dates of maturity or redemption of the Instruments, any Instalment Date or any |
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date for payment of interest on the Instruments, (ii) to reduce or cancel the nominal amount of, or any Instalment Amount of, or any premium payable on redemption of, the Instruments, (iii) to reduce the rate or rates of interest in respect of the Instruments or to vary the method or basis of calculating the rate or rates or amount of interest or the basis for calculating any Interest Amount in respect of the Instruments, (iv) if a Minimum and/or a Maximum Rate of Interest is shown on the face of the Instrument, to reduce any such Minimum and/or Maximum Rate of Interest, (v) to vary any method of calculating the Final Redemption Amount, the Early Redemption Amount or the Optional Redemption Amount, (vi) to take any steps that as specified in this Instrument may only be taken following approval by an Extraordinary Resolution to which the special quorum provisions apply [,or] (vii) to modify the provisions concerning the quorum required at any meeting of Instrumentholders or the majority required to pass the Extraordinary Resolution [or (viii) to modify or cancel the Guarantee]* will only be binding if passed at a meeting of the Instrumentholders (or at any adjournment of that meeting) at which a special quorum (as defined in the Trust Deed) is present. A resolution in writing signed by the holders of not less than 95 per cent. in nominal amount of the Instruments will be binding on all Instrumentholders and Couponholders. The Issuer may convene a meeting of Instrumentholders jointly with the holders of all other instruments issued pursuant to the Agency Agreement and not forming a single series with the Instruments to which meeting the provisions referred to above apply as if all such instruments formed part of the same series, provided that the proposals to be considered at such meeting affect the rights of the holders of the instruments of each series attending the meeting in identical respects (save insofar as the Conditions applicable to each such series are not identical). |
11.2 | Modification of the Trust Deed | ||
The Trustee may agree, without the consent of the Instrumentholders or Couponholders, to (i) any modification of any of the provisions of the Trust Deed that is of a formal, minor or technical nature or is made to correct a manifest error, and (ii) any other modification (except as mentioned in the Trust Deed), and any waiver or authorisation of any breach or proposed breach, of any of the provisions of the Trust Deed that is in the opinion of the Trustee not materially prejudicial to the interests of the Instrumentholders. Any such modification, authorisation or waiver shall be binding on the Instrumentholders and the Couponholders and, if the Trustee so requires, such modification shall be notified to the Instrumentholders as soon as practicable. | |||
11.3 | Substitution | ||
The Trust Deed contains provisions permitting the Trustee to agree, subject to such amendment of the Trust Deed and such other conditions as the Trustee may require, but without the consent of the Instrumentholders or the Couponholders, to the substitution of [a Successor in Business (as defined in the Trust Deed) or any subsidiary/any other company] ± in place of the Issuer or of any previous substituted company, as principal debtor under the Trust Deed and the Instruments [and the substitution of the Guarantors Successor in Business (as defined in the Trust Deed) or any subsidiary of the Guarantor in place of the Guarantor]*. In the case of such a substitution the Trustee may agree, without the consent of the Instrumentholders or the Couponholders, to a change of the law governing the Instruments, the Receipts, the Coupons, the Talons and/or the Trust Deed provided that such change would not in the opinion of the Trustee be materially prejudicial to the interests of the Instrumentholders. | |||
11.4 | Entitlement of the Trustee | ||
In connection with the exercise of its functions (including but not limited to those referred to in this Condition) the Trustee shall have regard to the interests of the Instrumentholders as a class and shall not have regard to the consequences of such exercise for individual Instrumentholders or |
± | Where National Grid Gas plc is the Issuer, delete the text any other company. Where National Grid Gas Finance (No 1) is the Issuer, delete the text a Successor in Business (as defined in the Trust Deed) or any subsidiary. |
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Couponholders and the Trustee shall not be entitled to require, nor shall any Instrumentholder or Couponholder be entitled to claim, from the Issuer [or the Guarantor]* any indemnification or payment in respect of any tax consequence of any such exercise upon individual Instrumentholders or Couponholders. |
12 | Replacement of Instruments, Receipts, Coupons and Talons | |
If an Instrument, Receipt, Coupon or Talon is lost, stolen, mutilated, defaced or destroyed, it may be replaced, subject to applicable laws, listing authority and stock exchange regulations, at the specified office of such other Paying Agent as may from time to time be designated by the Issuer[ or the Guarantor]* for the purpose and notice of whose designation is given to Instrumentholders in accordance with Condition 14 on payment by the claimant of the fees and costs incurred in connection with that replacement and on such terms as to evidence, security and indemnity (which may provide, inter alia , that if the allegedly lost, stolen or destroyed Instrument, Receipt, Coupon or Talon is subsequently presented for payment or, as the case may be, for exchange for further Coupons, there shall be paid to the Issuer[ or the Guarantor]* on demand the amount payable by the Issuer[ or the Guarantor]* in respect of such Instruments, Receipts, Coupons or further Coupons) and otherwise as the Issuer[ or the Guarantor]* may require. Mutilated or defaced Instruments, Receipts, Coupons or Talons must be surrendered before replacements will be issued. | ||
13 | Further Issues | |
The Issuer may from time to time without the consent of the Instrumentholders or Couponholders create and issue further instruments having the same terms and conditions as the Instruments and so that such further issue shall be consolidated and form a single series with such Instruments. References in these Conditions to the Instruments include (unless the context requires otherwise) any other instruments issued pursuant to this Condition and forming a single series with the Instruments. Any such further instruments forming a single series with Instruments constituted by the Trust Deed or any deed supplemental to it shall, and any other instruments may (with the consent of the Trustee), be constituted by the Trust Deed. | ||
The Trust Deed contains provisions for convening a single meeting of the Instrumentholders and the holders of instruments of other series if the Trustee so decides. | ||
14 | Notices | |
All notices to the Instrumentholders will be valid if published in a daily English language newspaper of general circulation in the United Kingdom (which is expected to be the Financial Times). If in the opinion of the Trustee any such publication is not practicable, notice shall be validly given if published in another leading daily English language newspaper with general circulation in Europe. Any such notice shall be deemed to have been given on the date of such publication or, if published more than once or on different dates, on the first date on which publication is made, as provided above. | ||
Couponholders shall be deemed for all purposes to have notice of the contents of any notice given to the holders of Instruments in accordance with this Condition. | ||
15 | Indemnification of Trustee | |
The Trust Deed contains provisions for the indemnification of the Trustee and for its relief from responsibility, including provisions relieving it from any obligation to take proceedings to enforce repayment unless indemnified to its satisfaction. The Trustee is entitled to enter into business transactions with the Issuer[, the Guarantor]* or any of [its/their] subsidiary undertakings, parent undertakings, joint ventures or associated undertakings without accounting for any profit resulting from these transactions and to act as trustee for the holders of any other securities issued by the Issuer or any of its subsidiary undertakings, parent undertakings, joint ventures or associated undertakings. |
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16 | Contracts (Rights of Third Parties) Act 1999 | |
No person shall have any right to enforce any term or condition of the Instruments under the Contracts (Rights of Third Parties) Act 1999. | ||
17 | Governing Law and Jurisdiction |
(a) | The Instruments and any non-contractual obligations arising out of or in connection with them shall be governed by, and construed in accordance with, English law. | ||
(b) | The courts of England have exclusive jurisdiction to settle any dispute (a Dispute ), arising from or connected with the Instruments. | ||
(c) | [Each of the]* /[The] Issuer[, and the Guarantor]* agrees that the courts of England are the most appropriate and convenient courts to settle any Dispute and, accordingly, that it will not argue to the contrary. | ||
(d) | Nothing in this Condition 17 prevents the Trustee or any Instrumentholder from taking proceedings relating to a Dispute ( Proceedings ) in any other courts with jurisdiction. To the extent allowed by law, the Trustee or Instrumentholders may take concurrent Proceedings in any number of jurisdictions. |
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[Cp. No.] | [Denomination] | [ISIN] | [Series] | [Certif. No.] |
* | Delete as applicable | |
** | [Only necessary where Interest Payment Dates are subject to adjustment in accordance with a Business Day Convention, otherwise the particular Interest Payment Date should be specified.] | |
*** | [Only required for Coupons relating to Floating Rate or Index Linked Interest Instruments that are issued in more than one denomination.] | |
**** | [Delete if Coupons are not to become void upon early redemption of Instrument.] |
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[Talon No.] | [ISIN] | [Series] | [Certif. No.] |
* | Delete as applicable | |
** | [The maturity dates of the relevant Coupons should be set out if known, otherwise reference should be made to the months and years in which the Interest Payment Dates fall due.] | |
*** | [Only required where the Series comprises Instruments of more than one denomination.] |
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* | Delete as applicable |
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1 | In this Schedule: | |
1.1 | references to a meeting are to a meeting of Instrumentholders of a single series of Instruments and include, unless the context otherwise requires, any adjournment; | |
1.2 | references to Instruments and Instrumentholders are only to the Instruments of the Series in respect of which a meeting has been, or is to be, called, and to the holders of these Instruments, respectively; | |
1.3 | agent means a holder of a voting certificate or a proxy for, or representative of, an Instrumentholder; | |
1.4 | block voting instruction means an instruction issued in accordance with paragraphs 8 to 14; | |
1.5 | Extraordinary Resolution means a resolution passed at a meeting duly convened and held in accordance with this Trust Deed by a majority of at least 75 per cent. of the votes cast; | |
1.6 | voting certificate means a certificate issued in accordance with paragraphs 5, 6, 7 and 14; and | |
1.7 | references to persons representing a proportion of the Instruments are to Instrumentholders or agents holding or representing in the aggregate at least that proportion in nominal amount of the Instruments for the time being outstanding. |
2 | A meeting shall, subject to the Conditions and without prejudice to any powers conferred on other persons by this Trust Deed, have power by Extraordinary Resolution: | |
2.1 | to sanction any proposal by the relevant Issuer, the Guarantor (if applicable) or the Trustee for any modification, abrogation, variation or compromise of, or arrangement in respect of, the rights of the Instrumentholders and/or the Couponholders against such Issuer or the Guarantor, as the case may be, whether or not those rights arise under this Trust Deed; | |
2.2 | to sanction the exchange or substitution for the Instruments of, or the conversion of the Instruments into, shares, bonds or other obligations or securities of the relevant Issuer or the Guarantor (if applicable) or any other entity; | |
2.3 | to assent to any modification of this Trust Deed, the Instruments, the Receipts, the Talons or the Coupons proposed by the relevant Issuer, the Guarantor (if applicable) or the Trustee; | |
2.4 | to authorise anyone to concur in and do anything necessary to carry out and give effect to an Extraordinary Resolution; | |
2.5 | to give any authority, direction or sanction required to be given by Extraordinary Resolution; |
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2.6 | to appoint any persons (whether Instrumentholders or not) as a committee or committees to represent the Instrumentholders interests and to confer on them any powers or discretions which the Instrumentholders could themselves exercise by Extraordinary Resolution; | |
2.7 | to approve a proposed new Trustee and to remove a Trustee; | |
2.8 | to approve the substitution of any entity for the relevant Issuer or the Guarantor (or any previous substitute) as principal debtor or guarantor under this Trust Deed; and | |
2.9 | to discharge or exonerate the Trustee from any liability in respect of any act or omission for which it may become responsible under this Trust Deed, the Instruments, the Receipts, the Talons or the Coupons, | |
provided that the special quorum provisions in paragraph 19 shall apply to any Extraordinary Resolution (a special quorum resolution ) for the purpose of sub-paragraph 2.2 or 2.7, any of the proposals listed in Condition 11.1 or any amendment to this proviso. |
3 | The relevant Issuer, the Guarantor (if applicable), or the Trustee may at any time convene a meeting. If it receives a written request by Instrumentholders holding at least 10 per cent. in nominal amount of the Instruments of any Series for the time being outstanding and is indemnified to its satisfaction against all costs and expenses, the Trustee shall convene a meeting of the Instrumentholders of that Series. Every meeting shall be held at a time and place approved by the Trustee. | |
4 | At least 21 days notice (exclusive of the day on which the notice is given and of the day of the meeting) shall be given to the Instrumentholders. A copy of the notice shall be given by the party convening the meeting to the other parties. The notice shall specify the day, time and place of meeting and, unless the Trustee otherwise agrees, the nature of the resolutions to be proposed and shall explain how Instrumentholders may appoint proxies or representatives, obtain voting certificates and use block voting instructions and the details of the time limits applicable. |
5 | If a holder of an Instrument wishes to obtain a voting certificate in respect of it for a meeting, he must deposit it for that purpose at least 48 hours before the time fixed for the meeting with a Paying Agent or to the order of a Paying Agent with a bank or other depositary nominated by the Paying Agent for the purpose. The Paying Agent shall then issue a voting certificate in respect of it. | |
6 | A voting certificate shall: | |
6.1 | be a document in the English language; | |
6.2 | be dated; | |
6.3 | specify the meeting concerned and the serial numbers of the Instruments deposited; and | |
6.4 | entitle, and state that it entitles, its bearer to attend and vote at that meeting in respect of those Instruments. |
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7 | Once a Paying Agent has issued a voting certificate for a meeting in respect of an Instrument, it shall not release the Instrument until either: | |
7.1 | the meeting has been concluded; or | |
7.2 | the voting certificate has been surrendered to the Paying Agent. | |
8 | If a holder of an Instrument wishes the votes attributable to it to be included in a block voting instruction for a meeting, then, at least 48 hours before the time fixed for the meeting, (i) he must deposit the Instrument for that purpose with a Paying Agent or to the order of a Paying Agent with a bank or other depositary nominated by the Paying Agent for the purpose and (ii) he or a duly authorised person on his behalf must direct the Paying Agent how those votes are to be cast. The Paying Agent shall issue a block voting instruction in respect of the votes attributable to all Instruments so deposited. | |
9 | A block voting instruction shall: | |
9.1 | be a document in the English language; | |
9.2 | be dated; | |
9.3 | specify the meeting concerned; | |
9.4 | list the total number and serial numbers of the Instruments deposited, distinguishing with regard to each resolution between those voting for and those voting against it; | |
9.5 | certify that such list is in accordance with Instruments deposited and directions received as provided in paragraphs 8, 11 and 14; and | |
9.6 | appoint a named person (a proxy ) to vote at that meeting in respect of those Instruments and in accordance with that list. | |
A proxy need not be an Instrumentholder. | ||
10 | Once a Paying Agent has issued a block voting instruction for a meeting in respect of the votes attributable to any Instruments: | |
10.1 | it shall not release the Instruments, except as provided in paragraph 11, until the meeting has been concluded; and | |
10.2 | the directions to which it gives effect may not be revoked or altered during the 48 hours before the time fixed for the meeting. | |
11 | If the receipt for an Instrument deposited with a Paying Agent in accordance with paragraph 8 is surrendered to the Paying Agent at least 48 hours before the time fixed for the meeting, the Paying Agent shall release the Instrument and exclude the votes attributable to it from the block voting instruction. | |
12 | Each block voting instruction shall be deposited at least 24 hours before the time fixed for the meeting at such place as the Trustee shall designate or approve, and in default it shall not be valid unless the chairman of the meeting decides otherwise before the meeting proceeds to business. If the Trustee requires, a notarially certified copy of each block voting instruction shall be produced by the proxy at the meeting but the Trustee need not investigate or be concerned with the validity of the proxys appointment. | |
13 | A vote cast in accordance with a block voting instruction shall be valid even if it or any of the Instrumentholders instructions pursuant to which it was executed has previously been |
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revoked or amended, unless written intimation of such revocation or amendment is received from the relevant Paying Agent by the relevant Issuer or the Trustee at its registered office or by the chairman of the meeting in each case at least 24 hours before the time fixed for the meeting. | ||
14 | No Instrument may be deposited with or to the order of a Paying Agent at the same time for the purposes of both paragraph 5 and paragraph 8 for the same meeting. |
15 | The chairman of a meeting shall be such person as the Trustee may nominate in writing, but if no such nomination is made or if the person nominated is not present within 15 minutes after the time fixed for the meeting the Instrumentholders or agents present shall choose one of their number to be chairman, failing which the relevant Issuer may appoint a chairman. The chairman need not be an Instrumentholder or agent. The chairman of an adjourned meeting need not be the same person as the chairman of the original meeting. |
16 | The following may attend and speak at a meeting: | |
16.1 | Instrumentholders and agents; | |
16.2 | the chairman; | |
16.3 | the relevant Issuer, the Guarantor (if applicable) and the Trustee (through their respective representatives) and their respective financial and legal advisers; and | |
16.4 | the Dealers and their advisers. | |
No one else may attend or speak. |
17 | No business (except choosing a chairman) shall be transacted at a meeting unless a quorum is present at the commencement of business. If a quorum is not present within 15 minutes from the time initially fixed for the meeting, it shall, if convened on the requisition of Instrumentholders or if the relevant Issuer and the Trustee agree, be dissolved. In any other case it shall be adjourned until such date, not less than 14 nor more than 42 days later, and time and place as the chairman may decide. If a quorum is not present within 15 minutes from the time fixed for a meeting so adjourned, the meeting shall be dissolved. | |
18 | Two or more Instrumentholders or agents present in person shall be a quorum: | |
18.1 | in the cases marked No minimum proportion in the table below, whatever the proportion of the Instruments which they represent; | |
18.2 | in any other case, only if they represent the proportion of the Instruments shown by the table below. |
COLUMN 1 | COLUMN 2 | COLUMN 3 | ||
Purpose of meeting
|
Any meeting except one referred to in column 3 | Meeting previously adjourned through want of a quorum | ||
|
||||
|
Required proportion | Required proportion | ||
|
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COLUMN 1 | COLUMN 2 | COLUMN 3 | ||
To pass a special
quorum resolution
|
Two thirds | One third | ||
|
||||
To pass any other
Extraordinary
Resolution
|
A clear majority | No minimum proportion | ||
|
||||
Any other purpose
|
10 per cent. | No minimum proportion |
19 | The chairman, may with the consent of (and shall if directed by) a meeting, adjourn the meeting from time to time and from place to place. Only business which could have been transacted at the original meeting may be transacted at a meeting adjourned in accordance with this paragraph or paragraph 18. | |
20 | At least 10 days notice of a meeting adjourned through want of a quorum shall be given in the same manner as for an original meeting and that notice shall state the quorum required at the adjourned meeting. However, no notice need otherwise be given of an adjourned meeting. |
21 | Each question submitted to a meeting shall be decided by a show of hands unless a poll is (before, or on the declaration of the result of, the show of hands) demanded by the chairman, the relevant Issuer, the Guarantor (if applicable) the Trustee or one or more persons holding one or more Instruments or voting certificates, in each case, representing two per cent. of the Instruments. | |
22 | Unless a poll is demanded a declaration by the chairman that a resolution has or has not been passed shall be conclusive evidence of the fact without proof of the number or proportion of the votes cast in favour of or against it. | |
23 | If a poll is demanded, it shall be taken in such manner and (subject as provided below) either at once or after such adjournment as the chairman directs. The result of the poll shall be deemed to be the resolution of the meeting at which it was demanded as at the date it was taken. A demand for a poll shall not prevent the meeting continuing for the transaction of business other than the question on which it has been demanded. | |
24 | A poll demanded on the election of a chairman or on a question of adjournment shall be taken at once. | |
25 | On a show of hands every person who is present in person and who produces an Instrument or a voting certificate or is a proxy or representative has one vote. On a poll every such person has one vote in respect of each nominal amount integral currency unit of the specified currency of such Series of Instruments so produced or represented by the voting certificate so produced or for which he is a proxy or representative. Without prejudice to the obligations of proxies, a person entitled to more than one vote need not use them all or cast them all in the same way. | |
26 | In case of equality of votes the chairman shall both on a show of hands and on a poll have a casting vote in addition to any other votes which he may have. |
27 | An Extraordinary Resolution shall be binding on all the Instrumentholders, whether or not present at the meeting, and on all the Couponholders and each of them shall be bound to |
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give effect to it accordingly. The passing of such a resolution shall be conclusive evidence that the circumstances justify its being passed. The relevant Issuer shall give notice of the passing of an Extraordinary Resolution to Instrumentholders within 14 days but failure to do so shall not invalidate the resolution. | ||
28 | A resolution in writing signed by or on behalf of the holders of not less than 95 per cent. in nominal amount of the Instruments who for the time being are entitled to receive notice of a meeting in accordance with the provisions of this Schedule shall for all purposes be as valid and effectual as an Extraordinary Resolution passed at a meeting of such Instrumentholders duly convened and held in accordance with the provisions of this Schedule. Such resolution in writing may be contained in one document or several documents in similar form each signed by or on behalf of one or more of the Instrumentholders. |
29 | Minutes shall be made of all resolutions and proceedings at every meeting and, if purporting to be signed by the chairman of that meeting or of the next succeeding meeting, shall be conclusive evidence of the matters in them. Until the contrary is proved every meeting for which minutes have been so made and signed shall be deemed to have been duly convened and held and all resolutions passed or proceedings transacted at it to have been duly passed and transacted. |
30 | Subject to all other provisions in this Trust Deed the Trustee may without the consent of the Instrumentholders prescribe such further regulations regarding the holding of meetings and attendance and voting at them as it in its sole discretion determines including (without limitation) such requirements as the Trustee thinks reasonable to satisfy itself that the persons who purport to make any requisition in accordance with this Trust Deed are entitled to do so and as to the form of voting certificates or block voting instructions so as to satisfy itself that persons who purport to attend or vote at a meeting are entitled to do so. | |
31 | The holder of a Global Instrument shall (unless such Global Instrument represents only one Instrument) be treated as two persons for the purposes of any quorum requirements of a meeting of Instrumentholders. | |
32 | The above provisions of this Schedule shall have effect subject to the following provisions: | |
32.1 | Meetings of Instrumentholders of separate Series will normally be held separately. However, the Trustee may from time to time determine that meetings of Instrumentholders of separate Series shall be held together. | |
32.2 | A resolution that in the opinion of the Trustee affects one Series alone shall be deemed to have been duly passed if passed at a separate meeting of the Instrumentholders of the Series concerned. | |
32.3 | A resolution that in the opinion of the Trustee affects the Instrumentholders of more than one Series but does not give rise to a conflict of interest between the Instrumentholders of the different Series concerned shall be deemed to have been duly passed if passed at a single meeting of the Instrumentholders of the relevant Series provided that for the purposes of determining the votes an Instrumentholder is entitled to cast pursuant to paragraph 25, each Instrumentholder shall have one vote in respect of each euro 1.00 |
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nominal amount of Instruments held, converted, if such Instruments are not denominated in euro, in accordance with Clause 8.13 ( Currency Conversion ). | ||
32.4 | A resolution that in the opinion of the Trustee affects the Instrumentholders of more than one Series and gives or may give rise to a conflict of interest between the Instrumentholders of the different Series concerned shall be deemed to have been duly passed only if it shall be duly passed at separate meetings of the Instrumentholders of the relevant Series. | |
32.5 | To all such meetings as previously set out all the preceding provisions of this Schedule shall mutatis mutandis apply as though references therein to Instruments and to Instrumentholders were references to the Instruments and Instrumentholders of the Series concerned. |
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(1) | NATIONAL GRID plc incorporated in the UK with registered number 04031152 whose registered office is at 1-3 Strand, London WC2N 5EH (the Company ); and | |
(2) | ANDREW ROBERT JOHN BONFIELD of Dalkeith House, Shrubbs Hill Lane, Sunningdale, Berkshire SL5 0LD (the Executive ). |
1 | Interpretation | |
In this agreement (and any schedules to it): |
1.1 | Definitions |
Board means the board of directors of the Company at any time or any person or committee nominated by the board of directors as its representative for the purposes of this agreement; | ||
Employment means the employment governed by this agreement; | ||
Group means the Company, its ultimate holding company from time to time and the Companys associates (as defined in section 435 of the Insolvency Act 1986) from time to time; | ||
Group Company means a member of the Group and Group Companies will be interpreted accordingly; | ||
holding company has the meaning given in section 1159 of the Companies Act 2006; | ||
Listing Rules means the listing rules made by the Financial Services Authority in exercise of its functions as a competent authority pursuant to Part VI of the Financial Services and Markets Act 2000; and | ||
Termination Date means the date on which the Employment terminates. |
2 | Commencement of Employment | |
2.1 | The Employment will start on 1 November 2010 or if later, the date upon which the conditions set out in clause 2.3 are satisfied (the Commencement Date ). The Employment will continue until termination in accordance with the provisions of this agreement. | |
2.2 | The Executive warrants that he is not prevented from taking up the Employment or from performing his duties in accordance with the terms of this agreement by any obligation or duty owed to any other party, whether contractual or otherwise. | |
2.3 | The commencement of the Employment is conditional upon the satisfaction of the following conditions: |
2.3.1 | the Executive undergoing a medical examination with a medical practitioner nominated by the Company, the results of which are satisfactory to the Company; | ||
2.3.2 | the Executive having the right to live and work in the United Kingdom and providing, and allowing the Company to retain, a copy of such evidence as may be required to demonstrate that he has such a right; and |
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2.3.3 | completion of appropriate background checks, the results of which are satisfactory to the Company. |
2.4 | In the event that the conditions set out in clause 2.3 above are not satisfied, the offer of the Employment will lapse. |
3 | Appointment and Duties of the Executive |
3.1 | The Executive will serve as Finance Director or in any other executive capacity as the Executive and the Company may agree from time to time. |
3.2 | The Executive will: |
3.2.1 | devote the whole of his time, attention and skill to the Employment; | ||
3.2.2 | properly perform his duties and exercise his powers; | ||
3.2.3 | accept any offices or directorships as reasonably required by the Board; | ||
3.2.4 | comply with all rules and regulations issued by the Company as amended from time to time, including without limitation, the Code of Employee Conduct and the Standards of Ethical Business Conduct; | ||
3.2.5 | obey the directions of the Board; and | ||
3.2.6 | use his best endeavours to promote the interests and reputation of every Group Company. |
3.3 | The Executive accepts that with his consent (which he will not unreasonably withhold or delay): |
3.3.1 | the Company may require him to perform duties for any other Group Company whether for the whole or part of his working time. In performing those duties clause 3.2.4 will apply as if references to the Company are to the appropriate Group Company. The Company will remain responsible for the payments and benefits he is entitled to receive under this agreement; and | ||
3.3.2 | the Company may appoint any other person to act jointly with him; and | ||
3.3.3 | the Company may transfer the Employment to any other Group Company. |
3.4 | The Executive will keep the Board (and, where appropriate the board of directors of any other Group Company) fully informed of his conduct of the business, finances or affairs of the Company or any other Group Company in a prompt and timely manner. He will provide information to the Board in writing if requested. | |
3.5 | The Executive will promptly disclose to the Board full details of any wrongdoing by any employee of any Group Company where that wrongdoing is material to that employees employment by the relevant company or to the interests or reputation of any Group Company. | |
3.6 | At any time during the Employment the Company may require the Executive to undergo a medical examination by a medical practitioner appointed by the Company. The Executive authorises that medical practitioner to disclose to the Company any report or test results prepared or obtained as a result of that examination and to discuss with it any matters arising out of the examination which are relevant to the Employment or which might prevent the Executive properly performing the duties of the Employment. |
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3.7 | The Executive is required to comply with the Companys policies and procedures which may be amended or introduced from time to time, these are available on the Company intranet. If there is any conflict between those polices and this agreement, the terms of this agreement shall prevail. |
4 | Hours | |
4.1 | The Executive will comply with the Companys normal hours of work and will also work any additional hours which may be reasonably necessary to perform his duties to the satisfaction of the Board. He will not receive any further remuneration for any hours worked in addition to the normal working hours. | |
4.2 | The Executive and the Company agree that the Executive is a managing executive for the purposes of the Working Time Regulations 1998 (the Regulations ) and is able to determine the duration of his working time himself. As such, the exemptions in Regulation 20 of the Regulations will apply to the Employment. | |
The Executive agrees to keep records of his working hours as reasonably required by the Company from time to time in order to comply with its obligations under the Regulations. |
5 | Interests of the Executive |
5.1 | The Executive will disclose promptly in writing to the Board all his interests (for example, shareholdings or directorships) whether or not of a commercial or business nature except his interests in any Group Company. The Executives interests at the date of this agreement are set out in Schedule 1. | |
5.2 | Subject to clause 5.3, during the Employment the Executive will not be directly or indirectly engaged or concerned in the conduct of any activity which is similar to or competes with any activity carried on by any Group Company (except as a representative of the Company or with the written consent of the Board). | |
5.3 | The Executive may not hold or be interested in investments which amount to more than three per cent of the issued investments of any class of any one company whether or not those investments are listed or quoted on any recognised Stock Exchange or dealt in on the Alternative Investments Market. | |
5.4 | The Executive will (and will procure that his spouse and dependent children) comply with all rules of law, including Part V of the Criminal Justice Act 1993, the Model Code as set out in the annex to Chapter 9 of the Listing Rules as amended from time to time and rules or policies applicable to the Company from time to time in relation to the holding or trading of securities. |
6 | Location | |
6.1 | The Executive will work at the principal office of the Company or anywhere else within the United Kingdom required by the Board. He may be required to travel and work outside the United Kingdom from time to time but, unless otherwise agreed with the Board, will not be required to live outside the United Kingdom. |
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7 | Base salary and Benefits | |
7.1 | The Company will pay the Executive a base salary of £675,000 per annum. Base salary will be paid in equal monthly instalments, partly in arrears and partly in advance, by bank credit transfer on or about the 15th day of each month and will accrue from day to day. Base salary will be reviewed annually. The review will usually take place in June, with the first such review for the Executive being in June 2011. | |
7.2 | The base salary referred to in clause 7.1 includes directors fees from the Group Companies and any other companies in which the Executive is required to accept a directorship under the terms of this Employment. To achieve this: |
7.2.1 | the Executive will repay any fees he receives to the Company; or | ||
7.2.2 | his base salary will be reduced by the amount of those fees; or | ||
7.2.3 | a combination of the methods set out in clauses 7.2.1 and 7.2.2 will be applied. |
7.3 | The Executive may, at the discretion of the Remuneration Committee, be invited to participate in any bonus plan operated by the Company and as introduced or amended from time to time. If so invited, the Executives participation in such bonus plan and the amount (if any) payable under it will be at the discretion of the Remuneration Committee and/or in accordance with the rules of any such plan in force from time to time. Participation in a bonus plan for one year does not entitle the Executive to participation in any bonus plan for any other year. | |
7.4 | The Company will provide a car for the Executives use in accordance with the rules of the Company car scheme, as amended, from time to time. | |
7.5 | The Company provides membership of the Defined Contribution section of the Companys pension scheme (the Scheme) subject to its trust deed and the rules of the Scheme as amended from time to time. |
7.5.1 | The Scheme is not contracted out of the second tier of the State Pension. The Executive may choose to contract out using a personal pension and/or stakeholder pension. | ||
7.5.2 | The minimum personal standard contribution by the Executive to the Scheme is 2% of base salary. The Company will match this contribution on a 2:1 basis up to certain limits, currently up to 10% of base salary, based upon the Executive making a personal contribution of 5% of base salary. The contribution rate required from the Executive and the contribution paid by the Company may be varied by the Company at any time in accordance with the rules of the Scheme. | ||
7.5.3 | In addition, the Executive will receive a cash payment of up to 30% of base salary less the Company contribution paid to the Scheme. Therefore, if the Executive makes a personal contribution to the Scheme of 2% of base salary, the Company will make a contribution of 4% of base salary to the Scheme and a cash payment of 26% of base salary to the Executive. Any such cash payment will be in lieu of additional pension benefits and will be paid in equal monthly instalments at the same time as the Executives base salary is paid. This payment will be subject to any deductions the Company is required to make. | ||
7.5.4 | The Executive can choose where his contributions are invested from the range of available options set by the trustees of the Scheme. |
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7.6 | Subject to the arrangements regarding holiday which are set out at clause 7.9 below and which take precedence, the Executive is eligible to participate in the Companys flexible benefits scheme as introduced or amended from time to time, currently Your Flexible Benefits, which provides access to a range of optional benefits. The Executive should note that some of the benefits provided under the scheme may be taxable benefits. The Executive should note the range of flexible benefits offered and the flexible benefits package itself does not form part of the Executives contract of employment and the Company reserves the right, at any time, to withdraw and/or amend the flexible benefits scheme and the benefits provided under it at its absolute discretion. | |
7.7 | If the Executive complies with any eligibility requirements or other conditions set by the Company and any insurer appointed by the Company (Insurer), the Executive and his spouse and children under 21 years of age who reside with the Executive or in full time education up to the age of 24 may participate in the Companys private health insurance arrangements at the Companys expense and subject to the terms of those arrangements in force from time to time. The Company reserves the right at any time to withdraw this benefit or to amend the terms upon which it is provided. The Executive understands and agrees that if the Insurer fails or refuses to provide him with any benefit under the insurance arrangement provided by the Company, the Executive will have no right of action against the Company in respect of such failure or refusal. | |
7.8 | The Executive is entitled to 28 days paid holiday each year (in addition to English bank and other public holidays) subject to any election the Executive may choose to make pursuant to the Companys flexible benefits scheme. Any election the Executive may choose to make pursuant to the Companys flexible benefits scheme to increase his holiday entitlement will be subject to prior Board or Chief Executive approval. All holiday must be taken at times approved in advance by the Board or by the Chief Executive. The Executives holiday year commences in the month of his birth and ends on the preceding month in the following year. Holidays may not be carried forward from one holiday year to the next without the Boards prior approval. The Executive agrees the provisions of Regulations 15(1)-(4) inclusive of the Regulations (dates on which leave is taken) do not apply to the Employment. | |
Holiday entitlement will accrue from day to day. For part years, the Executives holiday entitlement for the year will be pro-rated to the length of his service in that year. The Executive will be paid for any accrued holiday not taken at the Termination Date unless the Employment is terminated for gross misconduct or in accordance with clause 11.6. The Company may require the Executive to take any accrued holiday during any notice period. If on the Termination Date the Executive has exceeded his accrued holiday entitlement, the excess may be deducted from any sums due to him. The formula for calculating the amount of holiday due to the Executive and any payments or repayments to be made is 1/260 of the Executives annual base salary. |
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7.9 | The rules governing sickness absence are set out in the Companys Sickness Absence Policy which is available on the intranet. The Executive must comply with these rules. Without prejudice to any right of the Company to terminate the Employment at any time pursuant to clause 11, if the Executive is absent from work as a result of sickness or injury then provided that the rules are complied with, the Executive shall be entitled to sick pay in accordance with the rules of the Company sick pay scheme as detailed below: |
7.9.1 | If the Executive has less than six months continuous service, an allowance equal to base salary will be paid for a period of two weeks. | ||
7.9.2 | If the Executive has six months or more and less than twelve months continuous service: |
(i) | an allowance equal to base salary will be paid for a period of one month; | ||
(ii) | after the expiration of the one month period, an allowance equal to half of base salary will be paid for a further period of two months. |
7.9.3 | If the Executive has at least twelve months continuous service: |
(i) | an allowance equal to base salary will be paid for the first six months of such absence; | ||
(ii) | after the expiration of the six month period, an allowance equal to half of base salary will be paid for a further period of up to six months. |
7.9.4 | The amount of any benefit which the Executive is entitled to claim during that period of absence under any Social Security or National Insurance Scheme in England and Wales and/or any scheme of which the Executive is a non-contributory member by virtue of the Employment will be deducted from any base salary paid to him. The Company will pay the Executive statutory sick pay under the Social Security Contributions and Benefits Act 1992 (as amended) ( SSP ) and any base salary paid to him will be deemed to include statutory sick pay. The Company reserves the right to offset the amount of these benefits against base salary paid to the Executive even if the Executive has not recovered them. | ||
7.9.5 | Any sick pay or allowances in excess of SSP paid after the end of the periods referred to above is entirely at the Companys discretion. |
7.10 | If the Executive is absent from work due to sickness or injury which is caused by the fault of another person, and as a consequence recovers from that person or another person any sum representing compensation for loss of base salary under this agreement, the Executive will repay to the Company any money it has paid to him as base salary in respect of the same period of absence. | |
7.11 | The Company will reimburse the Executive reasonable expenses (capped at £40,000 per annum) incurred in using a driver for home to office base location travel. This is a taxable benefit. The expense will be reimbursed on a monthly basis and will be dependent upon the Executive providing receipts or other documents as proof that he has incurred the expense. |
8 | Expenses | |
8.1 | The Company will refund to the Executive all reasonable expenses properly incurred by him in performing his duties under this agreement, provided that these are incurred in |
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accordance with Company policy in force from time to time. The Company will require the Executive to produce receipts or other documents as proof that he has incurred any expenses he claims. | ||
8.2 | If the Executive is provided with a credit or charge card by the Company this must normally be used for expenses which he incurs in performing the duties of the Employment. It may be used for personal expenses only in exceptional circumstances. | |
9 | Confidentiality | |
9.1 | Without prejudice to the common law duties which he owes to the Company the Executive agrees that he will not, except in the proper performance of his duties, copy, use or disclose to any person any of the Companys trade secrets or confidential information. This restriction will continue to apply after the termination of the Employment without limit in time but will not apply to trade secrets or confidential information which become public other than through unauthorised disclosure by the Executive. The Executive will use his best endeavours to prevent the unauthorised copying use or disclosure of such information. | |
For the purposes of this agreement, trade secrets and confidential information include but will not be limited to technical data, know-how, information technology and know-how relating to the Company, customer lists, pricing information, information relating to the Companys marketing and financial strategies, marketing materials, financial information and any other information concerning the affairs of the Company which is for the time being confidential, which the Executive is told is confidential or which by its nature is obviously confidential and whether such information is in written, oral, visual, electronic or any other form. | ||
9.2 | In the course of the Employment the Executive is likely to obtain trade secrets and confidential information belonging or relating to other Group Companies and other persons. He will treat such information as if it falls within the terms of clause 9.1 and clause 9.1 will apply with any necessary amendments to such information. If requested to do so by the Company the Executive will enter into an agreement with other Group Companies and any other persons in the same terms as clause 9.1 with any amendments necessary to give effect to this provision. | |
9.3 | Nothing in this agreement will prevent the Executive from making a protected disclosure in accordance with the provisions of the Employment Rights Act 1996. | |
10 | Intellectual Property Rights | |
For the purposes of this clause, Intellectual Property means patents, trade marks, service marks, registered designs (including applications for and rights to apply for any of them), inventions, unregistered design rights, logos, trade or business names, copyrights, database rights, confidential information, knowhow and any similar rights in any country. |
10.1 | The Executive acknowledges that (i) it is part of his normal duties to develop the products and services of the Company; and (ii) because of the nature of his position he has a special obligation to further the interests of the Company. All Intellectual Property which the Executive develops or produces in the course of his employment duties, or outside such duties but relating to the business of the Company, will be owned by the Company to the |
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fullest extent permitted by law. The Executive agrees, at the Companys expense, to sign all documents and carry out all such acts as will be necessary to vest such Intellectual Property in the Company, and to obtain protection and enforce the Companys rights anywhere in the world. The Executive also hereby waives all moral rights in all Intellectual Property which is owned by the Company, or will be owned by the Company, further to this clause. The Executive will not copy, disclose or make use of any Intellectual Property belonging to the Company (whether or not subject to this clause) except to the extent necessary for the proper performance of his duties. Rights and obligations under this clause will continue after the termination of this agreement in respect of all Intellectual Property arising during the Employment. |
10.2 | The Executive must disclose immediately to the Company any discovery or invention, secret process or improvement in procedure made or discovered by the Executive during his employment in connection with or in any way affecting or relating to the business of the Company or any Group Company or capable of being used or adapted for use in or in connection with any such company ( Inventions ) which Inventions will belong to and be the absolute property of the Company or such other person, firm, company or organisation as the Company may require. | |
10.3 | If requested by the Board (whether during or after the termination of his employment) the Executive will, at the expense of the Company, apply or join in applying for letters patent or other similar protection in the United Kingdom or any other part of the world for all Inventions and will do everything necessary (including executing documents) for vesting letters patent or other similar protection when obtained; and all rights and title to and interest in all Inventions in the Company absolutely and as sole beneficial owner or in such other person, firm, company or organisation as the Company may require. | |
10.4 | The Executive will (both during and after the termination of his employment) at the Companys expense anywhere in the world and at any time promptly do everything (including executing documents) that may be required by the Board to defend or protect for the benefit of the Company all Inventions and the right and title of the Company to them. | |
10.5 | The provisions of clause 10.1 to 10.4 (inclusive) are without prejudice to the provisions of the Patents Act 1977. | |
10.6 | The entire copyright and all similar rights (including future copyright, the right to register trade marks or service marks and the right to register designs and design rights) throughout the world in works of any description produced by the Executive in the course of or in connection with his employment ( Works ) will vest in and belong to the Company absolutely throughout the world for the full periods of protection available in law including all renewals and extensions. | |
10.7 | The Executive will (both during and after the termination of his employment) at the Companys request and expense anywhere in the world and at any time promptly do everything (including executing documents) that may be required by the Board to assure, defined or protect the rights of the Company in all Works. | |
10.8 | For the purposes of this clause 10 the Executive hereby irrevocably and unconditionally waives in favour of the Company the moral rights conferred on the Executive by Chapter IV Part 1 of the Copyright Designs and Patents Act 1988 in respect of any Inventions or Works in which the copyright is vested in the Company under this clause 10 or otherwise. |
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10.9 | The Executive will not make copies of any computer files belonging to any Group Company or their service providers and will not introduce any of his own computer files into any computer used by any Group Company in breach of any Group Company policy, unless he has obtained the consent of the Board. | |
10.10 | By entering into this agreement the Executive irrevocably appoints the Company to act on his behalf to execute any document and do anything in his name for the purpose of giving the Company (or its nominee) the full benefit of the provision of clause 10 or the Companys entitlement under statute. If there is any doubt as to whether such a document (or other thing) has been carried out within the authority conferred by this clause 10.10, a certificate in writing (signed by any director or the secretary of the Company) will be sufficient to prove that the act or thing falls within that authority. | |
11 | Termination and Suspension | |
11.1 | The Employment will continue until terminated by either party giving written notice as set out in clause 11.2. | |
11.2 | Either party may terminate the Employment by giving not less than 12 months written notice to the other. | |
11.3 | Notwithstanding the other provisions of this agreement and in particular clause 11.2, the Employment will terminate automatically on the Executives 65th birthday, subject always to the Executives rights under the Employment Equality (Age) Regulations 2006. | |
11.4 | The Company may at its sole and absolute discretion pay base salary alone (as referred to in clause 7.1, at the rate in force at the time such payment is made) in lieu of any unexpired period of notice (less any deductions the Company is required by law to make). For the avoidance of doubt, the Executive is not entitled to participate in or benefit from any severance, termination or redundancy plan operated by any member of the Group. | |
11.5 | The Company may terminate the Employment by giving written notice to take immediate effect whether or not the Executives entitlement to sick pay, contractual or otherwise, has been exhausted if the Executive does not perform the duties of the Employment for a period of 364 days (whether or not consecutive) in any period of 2 years. This notice can be given whilst the Executive continues not to perform his duties or on expiry of the 364 day period. In this clause, days includes Saturdays, Sundays and public holidays. | |
11.6 | The Company may terminate the Employment by giving written notice to take immediate effect if the Executive: |
11.6.1 | has not performed his duties under this agreement to the standard required by the Board; or | ||
11.6.2 | commits any serious or persistent breach of his obligations under this agreement; or | ||
11.6.3 | does not comply with any term of this agreement; or | ||
11.6.4 | does not comply with any lawful order or direction given to him by the Board; or | ||
11.6.5 | is guilty of any gross misconduct or conducts himself (whether in connection with the Employment or not) in a way which is harmful to any Group Company; or |
ix
11.6.6 | is guilty of or confesses to dishonesty or is convicted of or confesses to an offence (other than a motoring offence which does not result in imprisonment) whether in connection with the Employment or not; or | ||
11.6.7 | commits (or is reasonably believed by the Board to have committed) a breach of any legislation in force which may affect or relate to the business of any Group Company; or | ||
11.6.8 | becomes of unsound mind, bankrupt or has a receiving order made against him or makes any general composition with his creditors or takes advantage of any statute affording relief for insolvent debtors; or | ||
11.6.9 | becomes disqualified from being a director of a company or the Executives directorship of the Company terminates without the consent or concurrence of the Company; or | ||
11.6.10 | fails to maintain or becomes disqualified from maintaining registration with any regulatory body, membership of which is reasonably required by the Company for the Executive to carry out his duties. |
11.7 | Where the Company terminates the Employment by giving written notice to take immediate effect in accordance with either clause 11.5 or 11.6, for the avoidance of doubt there is no obligation to give notice as set out in clause 11.1 or any other period of notice or to make any payment in lieu of notice. | |
11.8 | The Executive will have no claim for damages or any other remedy against the Company if the Employment is terminated for any of the reasons set out in clause 11.5 or 11.6. | |
11.9 | When the Employment terminates the Company may deduct from any money due to the Executive (including remuneration) any amount which he owes to any Group Company. | |
11.10 | The Company may suspend the Executive from the Employment on full base salary at any time, and for any reason for a reasonable period to investigate any matter in which the Executive is implicated or involved (whether directly or indirectly) and to conduct any related disciplinary proceedings. | |
12 | Garden Leave | |
12.1 | Neither the Company nor any Group Company is under any obligation to provide the Executive with any work. At any time after notice to terminate the Employment is given by either party under clause 11 above, or if the Executive resigns without giving due notice and the Company does not accept his resignation, the Company may, at its absolute discretion, require the Executive to take a period of absence called garden leave for a maximum period of 6 months (the Garden Leave Period ). The provisions of this clause shall apply to any Garden Leave Period. | |
12.2 | The Company may require that the Executive will not, without prior written consent of the Board, be employed or otherwise engaged in the conduct of any activity, whether or not of a business nature during the Garden Leave Period. Further, if so requested by the Company, the Executive will not: |
12.2.1 | enter or attend the premises of the Company or any other Group Company; or |
x
12.2.2 | contact or have any communication with any customer or client of the Company or any other Group Company in relation to the business of the Company or any other Group Company (other than purely social contact); or | ||
12.2.3 | contact or have any communication with any employee, officer, director, agent or consultant of the Company or any other Group Company in relation to the business of the Company or any other Group Company (other than purely social contact); or | ||
12.2.4 | remain or become involved in any aspect of the business of the Company or any other Group Company except as required by such companies; or | ||
12.2.5 | access the Companys or any Group Companys information technology systems. |
12.3 | The Company may require the Executive: |
12.3.1 | to comply with the provisions of clause 15, save that he will not be required to return any Company car during any Garden Leave Period; and | ||
12.3.2 | to immediately resign from any directorship, trusteeships or other offices which he holds in the Company, any other Group Company or any other company where such directorship or other office is held as a consequence or requirement of the Employment, unless he is required to perform duties to which any such directorship, trusteeship or other office relates in which case he may retain such directorships, trusteeships or other offices while those duties are ongoing. The Executive hereby irrevocably appoints the Company to be his attorney to execute any instrument and do anything in his name and on his behalf to effect his resignation if he fails to do so in accordance with this clause 12.3.2. |
12.4 | During the Garden Leave Period, the Executive will be entitled to receive his base salary and all contractual benefits in accordance with the terms of this agreement, save that he will not accrue any bonuses or be entitled to receive any new grants or awards under any long term incentive arrangements. Any unused holiday accrued at the commencement of the Garden Leave Period and any holiday accrued during any such period will be deemed to be taken by the Executive during the Garden Leave Period. | |
12.5 | At the end of or at any time during the Garden Leave Period, the Company may, at its sole and absolute discretion, pay the Executive base salary alone (as defined in clause 7.1) in lieu of the balance of any period of notice given by the Company or the Executive (less any deductions the Company is required by law to make). | |
12.6 | During the Garden Leave Period: |
12.6.1 | the Executive shall provide such assistance as the Company or any Group Company may require to effect an orderly handover of his responsibilities to any individual or individuals appointed by the Company or any Group Company to take over his role or responsibilities; | ||
12.6.2 | the Executive shall make himself available to deal with requests for information, provide assistance, be available for meetings and to advise on matters relating to work (unless the Company has agreed that the Executive may be unavailable for a period); and | ||
12.6.3 | the Company may appoint another person to carry out his duties in substitution for the Executive. |
xi
12.7 | All duties of the Employment (whether express or implied), including without limitation the Executives duties of fidelity, good faith and exclusive service, shall continue throughout the Garden Leave Period save as expressly varied by this clause 12. | |
12.8 | The Executive agrees that the exercise by the Company of its rights pursuant to this clause 12 shall not entitle the Executive to claim that he has been constructively dismissed. | |
13 | Restrictions after Termination of Employment | |
13.1 | In this clause: | |
Prohibited Area means the United Kingdom, New York State, Rhode Island, Massachusetts and any other country in the world or US State in which the Company or any Group Company has material business interests in the period of 12 months ending on the Relevant Date; | ||
Relevant Date means the Termination Date or, if earlier, the date on which the Executive commences any Garden Leave Period; and | ||
Restricted Period means the period of 12 months less any Garden Leave Period commencing on the Termination Date. | ||
13.2 | The Executive is likely to obtain trade secrets and confidential information and personal knowledge of and influence over customers clients and employees of the Group during the course of the Employment. To protect these interests of the Company, the Executive agrees with the Company that he will be bound by the following covenants: |
13.2.1 | during the Restricted Period and within the Prohibited Area he will not be engaged in, employed in, act as a consultant to or agent for or carry on for his own account or for any other person, whether directly or indirectly, (or be a director of any company engaged in) any business which, by virtue of its location or otherwise, is or is about to be in competition with any business of the Company or any other Group Company being carried on by such company at the Relevant Date provided he was concerned or involved with that business to a material extent at any time during the 12 months prior to the Relevant Date; and | ||
13.2.2 | during the Restricted Period he will not (either on his own behalf or for or with any other person, whether directly or indirectly), entice or try to entice away from the Company or any other Group Company any person who was senior employee, director, officer, agent, senior consultant or senior associate of such a company at the Termination Date and who had been senior employee, director, officer, agent, senior consultant or senior associate at any time during the six months prior to the Relevant Date and with whom he had worked closely at any time during that period. |
13.3 | Each of the paragraphs contained in clause 13.2 constitutes an entirely separate and independent covenant. If any covenant is found to be invalid this will not affect the validity or enforceability of any of the other covenants. | |
13.4 | Following the Termination Date, the Executive will not represent himself as being in any way connected with the businesses of the Company or of any other Group Company (except to the extent agreed by such a company). |
xii
13.5 | Any benefit given or deemed to be given by the Executive to any Group Company under the terms of clause 13 is received and held on trust by the Company for the relevant Group Company. The Executive will enter into appropriate restrictive covenants directly with other Group Companies if asked to do so by the Company. | |
14 | Offers on Liquidation | |
The Executive will have no claim against the Company if the Employment is terminated by reason of liquidation in order to reconstruct or amalgamate the Company or by reason of any reorganisation of the Company and the Executive is offered employment with the company succeeding to the Company upon such liquidation or reorganisation and the new terms of employment offered to the Executive are no less favourable to him than the terms of this agreement. | ||
15 | Return of Company Property | |
15.1 | At any time during the Employment (at the request of the Company) and in any event when the Employment terminates, the Executive will immediately return to the Company: |
15.1.1 | all documents and other materials (whether originals or copies) made or compiled by or delivered to the Executive during the Employment and concerning all the Group Companies. The Executive will not retain any copies of any materials or other information; and | ||
15.1.2 | all other property belonging or relating to any of the Group Companies. |
15.2 | When the Employment terminates the Executive will immediately return to the Company any car provided to the Executive which is in the possession or under the control of the Executive. The Company car must be returned in good condition (allowing for fair wear and tear). | |
15.3 | If the Executive commences Garden Leave in accordance with clause 12 he may be required to comply with the provisions of clause 15.1. | |
16 | Directorships | |
16.1 | The Executives office as a director of the Company or any other Group Company is subject to the Articles of Association of the relevant company (as amended from time to time). If the provisions of this agreement conflict with the provisions of the Articles of Association, the Articles of Association will prevail. | |
16.2 | The Executive must promptly resign from any office held in any Group Company if he is asked to do so by the Company. |
16.3 | If the Executive does not resign as an officer of a Group Company, having been requested to do so in accordance with clause 16.2, the Company will be appointed as his attorney to effect his resignation. By entering into this agreement, the Executive irrevocably appoints the Company as his attorney to act on his behalf to execute any document or do anything in his name necessary to effect his resignation in accordance with clause 16.2. If there is any doubt as to whether such a document (or other thing) has been carried out within the authority conferred by this clause 16.3, a certificate in writing (signed by any director or the |
xiii
secretary of the Company) will be sufficient to prove the act or thing falls within that authority. |
16.4 | The termination of any directorship or other office held by the Executive will not terminate the Executives employment or amount to a breach of terms of this agreement by the Company. | |
16.5 | During the Employment the Executive will not do anything which could cause him to be disqualified from continuing to act as a director of any Group Company. | |
16.6 | The Executive must not resign his office as a director of any Group Company without the agreement of the Company. | |
17 | Notices | |
17.1 | Any notices given under this agreement must be given by letter or fax. Notice to the Company must be addressed to its registered office at the time the notice is given. Notice to the Executive must be given to him personally or sent to his last known address. | |
17.2 | Except for notices given by hand, notices given by post will be deemed to have been given on the next working day after the day of posting and notices given by fax will be deemed to have been given in the ordinary course of transmission. | |
18 | Statutory Particulars | |
18.1 | The written particulars of employment which the Executive is entitled to receive under the provisions of Part I of the Employment Rights Act 1996 are set out below, insofar as they are not set out elsewhere in this agreement. |
18.1.1 | The Executives period of continuous employment began on the Commencement Date and does not include any previous employment with any other employer. | ||
18.1.2 | The Companys disciplinary rules and dismissal, disciplinary and grievance procedures as set out in the Staff Handbook and as amended from time to time are applicable to the Executive. The disciplinary rules are contractual. The dismissal, disciplinary and grievance procedures are non-contractual. | ||
18.1.3 | The Companys normal hours of work are 9.00am to 5.00pm Monday to Friday. | ||
18.1.4 | There are no terms and conditions relating to collective agreements or to the requirement to work outside the United Kingdom. |
19 | Data Protection Act 1998 | |
19.1 | For the purposes of the Data Protection Act 1998 (the Act ) the Executive gives his consent to the holding, processing and disclosure of personal data (including sensitive data within the meaning of the Act) provided by the Executive to the Company for all purposes relating to the performance of this agreement including, but not limited to: |
19.1.1 | administering and maintaining personnel records; | ||
19.1.2 | paying and reviewing base salary and other remuneration and benefits; |
xiv
19.1.3 | providing and administering benefits (including if relevant, pension, life assurance, permanent health insurance and medical insurance); | ||
19.1.4 | undertaking performance appraisals and reviews; | ||
19.1.5 | maintaining sickness and other absence records; | ||
19.1.6 | taking decisions as to the Executives fitness for work; | ||
19.1.7 | providing references and information to future employers, and if necessary, governmental and quasi-governmental bodies for social security and other purposes, the Inland Revenue and the Contributions Agency; | ||
19.1.8 | providing information to future purchasers of the Company or of the business in which the Executive works; and | ||
19.1.9 | transferring information concerning the Executive to a country or territory outside the EEA. |
19.2 | The Executive acknowledges that during his Employment he will have access to and process, or authorise the processing of, personal data and sensitive personal data relating to employees, customers and other individuals held and controlled by the Company. The Executive agrees to comply with the terms of the Act in relation to such data and to abide by the Companys data protection policy issued and updated from time to time. | |
20 | Contracts (Rights of Third Parties) Act 1999 | |
20.1 | To the extent permitted by law, no person other than the parties to this agreement and the Group Companies shall have the right to enforce any term of this agreement under the Contracts (Rights of Third Parties) Act 1999. For the avoidance of doubt, save as expressly provided in this clause the application of the Contracts (Rights of Third Parties) Act 1999 is specifically excluded from this agreement, although this does not affect any other right or remedy of any third party which exists or is available other than under this Act. | |
21 | Miscellaneous |
21.1 | This agreement may be entered into in any number of counterparts, all of which taken together shall constitute one and the same instrument. Any party may enter into this agreement by executing any such counterpart. | |
21.2 | This agreement may only be modified by the written agreement of the parties. | |
21.3 | The Executive cannot assign this agreement to anyone else. | |
21.4 | References in this agreement to rules, regulations, policies, handbooks or other similar documents which supplement it, are referred to in it or describe any pensions or other benefits arrangement are references to the versions or forms of the relevant documents as amended or updated from time to time. | |
21.5 | This agreement supersedes any previous written or oral agreement between the parties in relation to the matters dealt with in it. It (together with the Company rules and policies) contains the whole agreement between the parties relating to the Employment at the date the agreement was entered into (except for those terms implied by law which cannot be excluded by the agreement of the parties). The Executive acknowledges that he has not |
xv
been induced to enter into this agreement by any representation, warranty or undertaking not expressly incorporated into it. The Executive agrees and acknowledges that his only rights and remedies in relation to any representation, warranty or undertaking made or given in connection with this agreement (unless such representation, warranty or undertaking was made fraudulently) will be for breach of the terms of this agreement, to the exclusion of all other rights and remedies (including those in tort or arising under statute). |
21.6 | Neither partys rights or powers under this agreement will be affected if: |
21.6.1 | one party delays in enforcing any provision of this agreement; or | ||
21.6.2 | one party grants time to the other party. |
21.7 | The Interpretation Act 1978 shall apply to this agreement in the same way as it applies to an enactment. | |
21.8 | References to any statutory provisions include any modifications or re-enactments of those provisions. | |
21.9 | Headings will be ignored in construing this agreement. | |
21.10 | If either party agrees to waive his rights under a provision of this agreement, that waiver will only be effective if it is in writing and it is signed by him. A partys agreement to waive any breach of any term or condition of this agreement will not be regarded as a waiver of any subsequent breach of the same term or condition or a different term or condition. | |
21.11 | This agreement is governed by and will be interpreted in accordance with the laws of England and Wales. Each of the parties submits to the exclusive jurisdiction of the English Courts as regards any claim or matter arising under this agreement. |
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/s/ Helen Mahy | |
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Director | |
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in the presence of:
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/s/ Shirely Percy | |
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Witness |
xvi
EXECUTED
as a
DEED
by
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ü
ý þ |
/s/ Andrew Robert John Bonfield | ||
ANDREW ROBERT JOHN
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||||
BONFIELD
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in the presence of:
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Witnesss signature
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Name
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Kara Doyle | |
Address
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Walnut Tree House | |
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Green Street Green | |
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Dartford, Kent DA2 8DP | |
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Occupation
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Personal Assistant |
xvii
xviii
Country of | ||||
Name | Incorporation | |||
1.
|
65 WILLIS LANE, INC. | USA | ||
2.
|
ALBERTA NORTHEAST GAS LTD (35.7%) | Canada | ||
3.
|
ASSETHALL LIMITED | England & Wales | ||
4.
|
BEEGAS NOMINEES LIMITED | England & Wales | ||
5.
|
BIRCH SITES LIMITED | England & Wales | ||
6.
|
BLACKWATER A LIMITED | England & Wales | ||
7.
|
BLACKWATER B LIMITED | England & Wales | ||
8.
|
BLACKWATER C LIMITED | England & Wales | ||
9.
|
BLACKWATER D LIMITED | England & Wales | ||
10.
|
BLACKWATER E LIMITED | England & Wales | ||
11.
|
BLACKWATER H LIMITED | England & Wales | ||
12.
|
BLACKWATER J LIMITED | England & Wales | ||
13.
|
BLUE-NG (HOLDINGS) LIMITED (50%) | England & Wales | ||
14.
|
BLUE-NG LIMITED (via Blue-NG Holdings Ltd (a joint venture with 20C Ltd) in which National Grid Blue Power Ltd holds 50%) | England & Wales | ||
15.
|
BOSTON GAS COMPANY (incl Essex Gas Company) | USA | ||
16.
|
BRITISH TRANSCO CAPITAL INC | USA | ||
17.
|
BRITISH TRANSCO FINANCE (NO 1) LIMITED | Cayman Islands | ||
18.
|
BRITISH TRANSCO FINANCE (NO 2) LIMITED | Cayman Islands | ||
19.
|
BRITISH TRANSCO FINANCE (NO 3) LIMITED | England & Wales | ||
20.
|
BRITISH TRANSCO FINANCE (NO 5) LIMITED | England & Wales | ||
21.
|
BRITISH TRANSCO FINANCE INC | USA | ||
22.
|
BRITISH TRANSCO INTERNATIONAL FINANCE BV | The Netherlands | ||
23.
|
BRITNED DEVELOPMENT LIMITED (50%) | England & Wales | ||
24.
|
BROKEN BRIDGE CORP. | USA | ||
25.
|
C4GAS SAS (47.5%) | France | ||
26.
|
COLONIAL GAS COMPANY | USA | ||
27.
|
CONNECTICUT YANKEE ATOMIC POWER COMPANY (19.5%) | USA | ||
28.
|
CORESO SA (22.485%%) | Belgium | ||
29.
|
DIRECT GLOBAL POWER, INC. (26%) | USA | ||
30.
|
EASTERN ASSOCIATED SECURITIES CORP. | USA | ||
31.
|
EASTERN RIVERMOOR COMPANY, INC. | USA | ||
32.
|
ELEXON LIMITED | England & Wales | ||
33.
|
ENERGIS PLC (33.06%) | England & Wales | ||
34.
|
ENERGYNORTH NATURAL GAS, INC. | USA | ||
35.
|
EUA ENERGY INVESTMENT CORPORATION | USA | ||
36.
|
EUA FRC II ENERGY ASSOCIATES | USA | ||
37.
|
EVIONYX, INC. (16%) | USA | ||
38.
|
GRANITE STATE ELECTRIC COMPANY | USA | ||
39.
|
GRIDAMERICA HOLDINGS INC | USA | ||
40.
|
GRIDCOM LIMITED | England & Wales | ||
41.
|
INVERSIONES ABC LTDA (98.84%) | Chile | ||
42.
|
IROQUOIS GAS TRANSMISSION SYSTEM, L.P. (20.4%) | USA | ||
43.
|
IROQUOIS PIPELINE OPERATING COMPANY (effectively 20.4% via Iroquois Gas Transmission System, L.P. 100% ownership) | USA | ||
44.
|
ISLAND ENERGY SERVICES COMPANY, INC. | USA | ||
45.
|
ISLANDER EAST PIPELINE COMPANY, LLC (50%) | USA | ||
46.
|
JOINT RADIO COMPANY LIMITED (50%) | England & Wales | ||
47.
|
KEYSPAN (U.K.) | England & Wales | ||
48.
|
KEYSPAN C.I. II, LTD | Cayman Islands | ||
49.
|
KEYSPAN C.I., LTD | Cayman Islands | ||
50.
|
KEYSPAN CI MIDSTREAM LIMITED | USA | ||
51.
|
KEYSPAN CORPORATION | USA | ||
52.
|
KEYSPAN ENERGY CORPORATION | USA | ||
53.
|
KEYSPAN ENERGY DEVELOPMENT CO. | USA | ||
54.
|
KEYSPAN ENERGY SERVICES INC. | USA | ||
55.
|
KEYSPAN ENERGY SERVICES NEW JERSEY, LLC | USA | ||
56.
|
KEYSPAN GAS EAST CORPORATION | USA | ||
57.
|
KEYSPAN INTERNATIONAL CORPORATION | USA | ||
58.
|
KEYSPAN LUXEMBOURG S.A.R.L. | Luxembourg | ||
59.
|
KEYSPAN MHK, INC. | USA | ||
60.
|
KEYSPAN MIDSTREAM INC. | USA | ||
61.
|
KEYSPAN PLUMBING & HEATING SOLUTIONS, LLC (90%) | USA | ||
62.
|
KEYSPAN PLUMBING SOLUTIONS, INC. | USA | ||
63.
|
KSI CONTRACTING, LLC | USA | ||
64.
|
KSI ELECTRICAL, LLC | USA | ||
65.
|
KSI MECHANICAL, LLC | USA | ||
66.
|
LAND MANAGEMENT AND DEVELOPMENT, INC | USA | ||
67.
|
LANDRANCH LIMITED | England & Wales |
Country of
Name
Incorporation
LANDWEST, INC
USA
LATTICE ENERGY SERVICES LIMITED
England & Wales
LATTICE GROUP EMPLOYEE BENEFIT TRUST LIMITED
England & Wales
LATTICE GROUP INTERNATIONAL HOLDINGS LIMITED
England & Wales
LATTICE GROUP PLC
England & Wales
LATTICE GROUP TRUSTEES LIMITED
England & Wales
LATTICE OPSCO LIMITED
England & Wales
LATTICE TELECOM FINANCE (NO 1) LIMITED
Isle of Man
MAINE YANKEE ATOMIC POWER COMPANY
(24%)
USA
MAINSTREAM FORTY-SEVEN LIMITED
England & Wales
MARQUEZ DEVELOPMENT CORP.
USA
MASSACHUSETTS ELECTRIC COMPANY
USA
MEERESTEIJN FINANCE BV
Netherlands
MELMAR LIMITED
Isle of Man
METRO ENERGY, L.L.C.
USA
METROWEST REALTY LLC
USA
MILLENNIUM PIPELINE COMPANY, LLC
(26.25%)
USA
MYHOMEGATE, INC.
USA
MYHOMEKEY.COM, INC.
(18.2%)
USA
MYSTIC STEAMSHIP CORPORATION
USA
NANTUCKET ELECTRIC COMPANY
USA
NATGRID FINANCE HOLDINGS LIMITED
England & Wales
NATGRID FINANCE LIMITED
England & Wales
NATGRID INVESTMENTS LIMITED
England & Wales
NATGRID LIMITED
England & Wales
NATGRID ONE LIMITED
England & Wales
NATIONAL GRID (IOM) UK LTD
Isle of Man
NATIONAL GRID (IRELAND) 1 LIMITED
Republic of Ireland
NATIONAL GRID (IRELAND) 2 LIMITED
Republic of Ireland
NATIONAL GRID (SOUTHALL) GENERAL PARTNER LIMITED
England & Wales
NATIONAL GRID (SOUTHALL) LP LIMITED
England & Wales
NATIONAL GRID (US) HOLDINGS LIMITED
England & Wales
NATIONAL GRID (US) INVESTMENTS
England & Wales
NATIONAL GRID (US) INVESTMENTS 2 LIMITED
England & Wales
NATIONAL GRID (US) INVESTMENTS 3
England & Wales
NATIONAL GRID (US) INVESTMENTS 4 LIMITED
England & Wales
NATIONAL GRID (US) PARTNER 1 LIMITED
England & Wales
NATIONAL GRID (US) PARTNER 2 LIMITED
England & Wales
NATIONAL GRID AUSTRALIA PTY LIMITED
Australia
NATIONAL GRID BLUE POWER FINANCE LIMITED
England & Wales
NATIONAL GRID BLUE POWER LIMITED
England & Wales
NATIONAL GRID BRAZIL B.V.
The Netherlands
NATIONAL GRID BRAZIL FINANCE
England & Wales
NATIONAL GRID BRAZIL TRANSMISSION B.V.
The Netherlands
NATIONAL GRID CARBON LIMITED
England & Wales
NATIONAL GRID CHILE B.V.
The Netherlands
NATIONAL GRID COMMERCIAL HOLDINGS LIMITED
England & Wales
NATIONAL GRID CORPORATE SERVICES LLC
USA
NATIONAL GRID DEVELOPMENT HOLDINGS CORP.
USA
NATIONAL GRID EIGHT
England & Wales
NATIONAL GRID EIGHTEEN LIMITED
England & Wales
NATIONAL GRID ELECTRIC SERVICES LLC
USA
NATIONAL GRID ELECTRICITY TRANSMISSION PLC
England & Wales
NATIONAL GRID ELEVEN
England & Wales
NATIONAL GRID ENERGY MANAGEMENT, LLC
USA
NATIONAL GRID ENERGY SERVICES, LLC
USA
NATIONAL GRID ENERGY SUPPLY, LLC
USA
NATIONAL GRID ENERGY TRADING SERVICES LLC
USA
NATIONAL GRID ENGINEERING & SURVEY INC.
USA
NATIONAL GRID EXPLORATION AND PRODUCTION, LLC
USA
NATIONAL GRID FIFTEEN LIMITED
England & Wales
NATIONAL GRID FINANCE B.V.
The Netherlands
NATIONAL GRID FIVE LIMITED
England & Wales
NATIONAL GRID FOUR LIMITED
England & Wales
Country of
Name
Incorporation
NATIONAL GRID FOURTEEN LIMITED
England & Wales
NATIONAL GRID GAS FINANCE (NO 1) PLC
England & Wales
NATIONAL GRID GAS HOLDINGS LIMITED
England & Wales
NATIONAL GRID GAS PLC
England & Wales
NATIONAL GRID GENERATION LLC
USA
NATIONAL GRID GLENWOOD ENERGY CENTER, LLC
USA
NATIONAL GRID GOLD LIMITED
England & Wales
NATIONAL GRID GRAIN LNG LIMITED
England & Wales
NATIONAL GRID HOLDINGS B.V.
The Netherlands
NATIONAL GRID HOLDINGS INC.
USA
NATIONAL GRID HOLDINGS LIMITED
England & Wales
NATIONAL GRID HOLDINGS ONE PLC
England & Wales
NATIONAL GRID HOLDINGS PTY LIMITED
Australia
NATIONAL GRID IGTS CORP.
USA
NATIONAL GRID INDIA B.V.
The Netherlands
NATIONAL GRID INDUS B.V.
The Netherlands
NATIONAL GRID INSURANCE COMPANY (IRELAND) LIMITED
Republic of Ireland
NATIONAL GRID INSURANCE COMPANY (ISLE OF MAN) LIMITED
Isle of Man
NATIONAL GRID INSURANCE COMPANY (VERMONT)
USA
NATIONAL GRID INTERCONNECTORS LIMITED
England & Wales
NATIONAL GRID INTERNATIONAL LIMITED
England & Wales
NATIONAL GRID ISLANDER EAST PIPELINE LLC
USA
NATIONAL GRID JERSEY HOLDINGS FIVE LIMITED
Jersey
NATIONAL GRID JERSEY INVESTMENTS LIMITED
Jersey
NATIONAL GRID JERSEY INVESTMENTS THREE LIMITED
Jersey
NATIONAL GRID LAND AND PROPERTIES LIMITED
England & Wales
NATIONAL GRID LAND DEVELOPMENTS LIMITED
England & Wales
NATIONAL GRID LAND INVESTMENTS LIMITED
England & Wales
NATIONAL GRID LNG GP LLC
USA
NATIONAL GRID LNG LP
USA
NATIONAL GRID LNG LP LLC
USA
NATIONAL GRID (LUX) INVESTMENTS LIMITED
England & Wales
NATIONAL GRID MANQUEHUE B.V.
The Netherlands
NATIONAL GRID METERING LIMITED
England & Wales
NATIONAL GRID MIDDLE EAST FZCO
United Arab Emirates
NATIONAL GRID MILLENNIUM LLC
USA
NATIONAL GRID NE HOLDINGS 2 LLC
USA
NATIONAL GRID NETHERLANDS ONE BV
The Netherlands
NATIONAL GRID NETHERLANDS THREE BV
The Netherlands
NATIONAL GRID NETHERLANDS TWO BV
The Netherlands
NATIONAL GRID NINE LIMITED
England & Wales
NATIONAL GRID NINETEEN LIMITED
England & Wales
NATIONAL GRID NORTH EAST VENTURES INC
USA
NATIONAL GRID OFFSHORE LTD
England & Wales
NATIONAL GRID ONE LIMITED
England & Wales
NATIONAL GRID OVERSEAS LIMITED
England & Wales
NATIONAL GRID OVERSEAS TWO LIMITED
England & Wales
NATIONAL GRID PLC
England & Wales
NATIONAL GRID POLAND B.V.
The Netherlands
NATIONAL GRID PORT JEFFERSON ENERGY CENTER, LLC
USA
NATIONAL GRID PROCUREMENT BV
The Netherlands
NATIONAL GRID PROPERTY (HIGH WYCOMBE) LIMITED
England & Wales
NATIONAL GRID PROPERTY (NORTHAMPTON) LIMITED
England & Wales
NATIONAL GRID PROPERTY (TAUNTON) LIMITED
England & Wales
NATIONAL GRID PROPERTY (WARWICK) LIMITED
England & Wales
NATIONAL GRID PROPERTY DEVELOPMENTS LIMITED
England & Wales
NATIONAL GRID PROPERTY HOLDINGS LIMITED
England & Wales
NATIONAL GRID PROPERTY LIMITED
England & Wales
NATIONAL GRID PROPERTY (NORTHFLEET) LIMITED
England & Wales
NATIONAL GRID SERVICES, INC.
USA
NATIONAL GRID SEVEN LIMITED
England & Wales
NATIONAL GRID SEVENTEEN LIMITED
England & Wales
NATIONAL GRID SIX LIMITED
England & Wales
NATIONAL GRID SIXTEEN LIMITED
England & Wales
NATIONAL GRID TECHNOLOGIES INC.
USA
NATIONAL GRID TELEMETRY SOLUTIONS, LLC
USA
NATIONAL GRID TEN
England & Wales
NATIONAL GRID THREE LIMITED
England & Wales
Country of
Name
Incorporation
NATIONAL GRID TRANSMISSION SERVICES CORPORATION
USA
NATIONAL GRID TWELVE LIMITED
England & Wales
NATIONAL GRID TWENTY-FIVE LIMITED
England & Wales
NATIONAL GRID TWENTY FOUR LIMITED
England & Wales
NATIONAL GRID TWENTY LIMITED
England & Wales
NATIONAL GRID TWENTY ONE LIMITED
England & Wales
NATIONAL GRID TWENTY-SIX LIMITED
England & Wales
NATIONAL GRID TWENTY THREE LIMITED
England & Wales
NATIONAL GRID TWO LIMITED
England & Wales
NATIONAL GRID UK LIMITED
England & Wales
NATIONAL GRID UK PENSION SERVICES LIMITED
England & Wales
NATIONAL GRID US 6 LLC
USA
NATIONAL GRID US 7 INC.
USA
NATIONAL GRID US LLC
USA
NATIONAL GRID USA
USA
NATIONAL GRID USA SERVICE COMPANY, INC.
USA
NATIONAL GRID UTILITY SERVICES LLC
USA
NATIONAL GRID ZAMBIA LIMITED
England & Wales
NEES ENERGY, INC.
USA
NEW ENGLAND ELECTRIC TRANSMISSION CORPORATION
USA
NEW ENGLAND ENERGY INCORPORATED
USA
NEW ENGLAND HYDRO FINANCE COMPANY, INC.
(53.704%)
USA
NEW ENGLAND HYDRO-TRANSMISSION CORPORATION
(53.704%)
USA
NEW ENGLAND HYDRO-TRANSMISSION ELECTRIC COMPANY, INC.
(53.704%)
USA
NEW ENGLAND POWER COMPANY
USA
NEW ENGLAND WHOLESALE ELECTRIC COMPANY
USA
NEWHC, INC.
USA
NEWPORT AMERICA CORPORATION
USA
NG CHICAGO I, LLC
USA
NG CHICAGO II, LLC
USA
NG FINANCING PARTNERSHIP 1
Luxembourg
NG FINANCING PARTNERSHIP 2
Luxembourg
NG JERSEY LIMITED
Jersey
NG LEASING LIMITED
England & Wales
NG LUXEMBOURG 3 SARL
Luxembourg
NG LUXEMBOURG 4 SARL
Luxembourg
NG LUXEMBOURG 5 SARL
Luxembourg
NG LUXEMBOURG 6 SARL
Luxembourg
NG LUXEMBOURG 7 SARL
Luxembourg
NG LUXEMBOURG HOLDINGS LIMITED
England & Wales
NG LUXEMBOURG SA
Luxembourg
NG LUXEMBOURG TWO SARL
Luxembourg
NG NOMINEES LIMITED
England & Wales
NG PROCUREMENT HOLDINGS LIMITED
England & Wales
NG VILLIERS LIMITED PARTNERSHIP
England & Wales
NGC DO BRASIL PARTICIPACOES LTDA
Brazil
NGC EMPLOYEE SHARES TRUSTEE LIMITED
England & Wales
NGC INDUS LIMITED
England & Wales
NGC TWO LIMITED
England & Wales
NGC ZAMBIA LIMITED
England & Wales
NGET / SPT UPGRADES LTD
(50%)
England & Wales
NGG (DELAWARE) LLC
USA
NGG FINANCE (NO 1) LIMITED
England & Wales
NGG FINANCE PLC
England & Wales
NGG TELECOMS HOLDINGS LIMITED
England & Wales
NGG TELECOMS LIMITED
England & Wales
NGM1 (GBR) LIMITED
Gibraltar
NGNE LLC
USA
NGP(IM7S) LIMITED
Isle of Man
NGP(IM7S) SUB LIMITED
England & Wales
NGRID INTELLECTUAL PROPERTY LIMITED
England & Wales
NGT FIVE LIMITED
Cayman Islands
NGT FOUR LIMITED
Cayman Islands
NGT HOLDING COMPANY (ISLE OF MAN) LIMITED
Isle of Man
NGT LUXEMBOURG ONE LIMITED
England & Wales
NGT ONE LIMITED
England & Wales
Country of
Name
Incorporation
NGT TELECOM NO. 1 LIMITED
England & Wales
NGT TELECOM NO. 2 LIMITED
England & Wales
NGT THREE
England & Wales
NGT TWO LIMITED
England & Wales
NIAGARA MOHAWK ENERGY, INC.
USA
NIAGARA MOHAWK HOLDINGS, INC.
USA
NIAGARA MOHAWK POWER CORPORATION
USA
NICODAMA BEHEER V B.V.
Netherlands
NM PROPERTIES, INC.
USA
NM URANIUM, INC.
USA
NMP LIMITED
England & Wales
NORTH EAST TRANSMISSION CO., INC.
USA
NORTHEAST GAS MARKETS LLC
(90%)
USA
ONSTREAM METERING SERVICES LIMITED
England & Wales
OPINAC NORTH AMERICA, INC.
USA
PATIENCE REALTY CORP.
USA
PCC LAND COMPANY, INC.
USA
PHILADELPHIA COKE CO., INC.
USA
PORT GREENWICH LIMITED
England & Wales
PORT OF THE ISLANDS NORTH LLC
USA
PRUDENCE CORPORATION
USA
SCC UNO SA
Chile
SECOND STREET ASSOCIATES, LLC
(50%)
USA
SENECA UPSHUR PETROLEUM, INC.
USA
STARGAS NOMINEES LIMITED
England & Wales
SUPERGRID ENERGY TRANSMISSION LIMITED
England & Wales
SUPERGRID LIMITED
England & Wales
TELECOM INTERNATIONAL HOLDINGS LIMITED
England & Wales
THAMESPORT INTERCHANGE LIMITED
England & Wales
THE BROOKLYN UNION GAS COMPANY
USA
THE NARRAGANSETT ELECTRIC COMPANY
USA
THE NATIONAL GRID GROUP QUEST TRUSTEE COMPANY LTD
England & Wales
THE NATIONAL GRID INVESTMENTS COMPANY
England & Wales
TRANSCO LIMITED
England & Wales
TRANSGAS, INC.
USA
UNIT 40 SUBLESSOR LLC
USA
UPPER HUDSON DEVELOPMENT INC
USA
UTILITY METERING SERVICES LIMITED
England & Wales
VALLEY APPLIANCE AND MERCHANDISING COMPANY
USA
VILLIERS FINANCE SA
(44%)
Luxembourg
WAYFINDER GROUP, INC.
USA
XOSERVE LIMITED
(56.5%)
England & Wales
YANKEE ATOMIC ELECTRIC COMPANY
(34.5%)
USA
1. | I have reviewed this annual report on Form 20-F of National Grid plc; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; | |
4. | The companys other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the company and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the companys disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the companys internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the companys internal control over financial reporting; and |
5. | The companys other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the companys auditors and the audit committee of the companys board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the companys ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the companys internal control over financial reporting. |
|
/s/ Steve Holliday
|
|||
|
Title: Chief Executive | |||
|
National Grid plc |
1. | I have reviewed this annual report on Form 20-F of National Grid plc; | |
2. | Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report; | |
3. | Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the company as of, and for, the periods presented in this report; | |
4. | The companys other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the company and have: |
(a) | Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared; | ||
(b) | Designed such internal control over financial reporting or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles; | ||
(c) | Evaluated the effectiveness of the companys disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and | ||
(d) | Disclosed in this report any change in the companys internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the companys internal control over financial reporting; and |
5. | The companys other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the companys auditors and the audit committee of the companys board of directors (or persons performing the equivalent functions): |
(a) | All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the companys ability to record, process, summarize and report financial information; and | ||
(b) | Any fraud, whether or not material, that involves management or other employees who have a significant role in the companys internal control over financial reporting. |
|
/s/ Andrew Bonfield
|
|||
|
Title: Finance Director | |||
|
National Grid plc |
June 13, 2011
|
/s/ Steve Holliday
|
|||
|
Title: Chief Executive | |||
|
National Grid plc | |||
|
||||
June 13, 2011
|
/s/ Andrew Bonfield
|
|||
|
Title: Finance Director | |||
|
National Grid plc |
2010 ONGOING Our huge investment programme will help our network meet future energy challenges. 2012 We will continue to work closely with schools and colleges to enthuse and inspire young students about the world of science and engineering. 2050 The Climate Change Act requires the UK to cut greenhouse gases by 2050. Meeting these targets requires us to dramatically change the way we produce gas and electricity. 2020 We will play a key role in connecting new generation to the grid. |
Overview
|
12 | How the UK electricity industry works |
This overview
section provides an
accessible
introduction to
what we do and the
environment in
which we operate.
We show in
pictographic form
the electricity and
gas industries in
the UK and US, and
show how the
various market
participants
interact. We
discuss how we
organise ourselves
into lines of
business, describe
the principal
activities of each
line of business
and highlight some
significant
developments during
2010/11.
|
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|
14 | How the US electricity industry works | |||||||
|
16 | How the UK gas industry works | |||||||
|
18 | How the US gas industry works | |||||||
|
20 | Where we operate | |||||||
|
22 | Management structure from 4 April 2011 | |||||||
|
23 | Management structure until 3 April 2011 | |||||||
|
24 | Principal operations | |||||||
|
26 | Review of the year | |||||||
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Operating
environment |
28 | Operating environment |
This section
provides an
overview of the
external factors
affecting our
operations. Since
97% of National
Grids operating
profit arises from
regulated
activities, an
understanding of
the work of our
economic regulators
is key to
understanding our
business, so we
provide a detailed
explanation of the
regulatory
processes in the UK
and US.
|
||||||
30 | Regulatory environment UK regulation | ||||||||
|
32 | Regulatory environment US regulation | |||||||
|
35 |
Summary of US price controls
and rate plans |
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|
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|
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|
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Delivering operational performance
|
36 |
Business drivers, principal risks
and opportunities |
This section sets
out the key factors
that drive our
business, and how
our strategy and
the Company
objectives are
designed to address
those factors. The
objectives form the
basis for the
execution of our
strategy and our
performance is
measured against
those objectives.
Our key performance
indicators are
shown on pages 40
and 41 and the
discussion which
follows includes a
number of further
quantitative and
qualitative
measures.
|
||||||
38 | Vision, strategy and objectives | ||||||||
40 | Key performance indicators | ||||||||
42 | Performance against objectives | ||||||||
|
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|
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|
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Financial information
|
54 | Financial performance |
This section
discusses our
financial
performance. It
also describes our
approaches to
capital management
and risk
management,
including the
policies and
strategies which
govern our use of
financial and
commodity
derivatives.
|
||||||
70 |
Financial position and
financial management |
||||||||
78 | Accounting policies | ||||||||
|
|
Transmission UK | ||||||
Electricity transmission owner We own the electricity transmission system in England and Wales. Electricity system operator We are the national electricity transmission system operator, responsible for managing the operation of both the England and Wales transmission system, which we own, and the two high voltage transmission networks in Scotland, which we do not own. Day-to-day operation of the system involves the continuous real-time matching of demand and generation output, ensuring the stability and security of the power system and the maintenance of |
satisfactory voltage and frequency. We are also designated as system operator for the new offshore electricity transmission regime. Gas transmission owner We own the gas national transmission system (NTS) in Great Britain, connecting to eight distribution networks and to third party independent systems for onward transportation of gas to end consumers. Gas system operator We operate the NTS. Day-to-day operation involves balancing supply and demand. |
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|
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|
Gas Distribution UK | ||||||
Gas distribution operator We own and operate four of the eight regional gas distribution networks in Great Britain. Our networks comprise approximately 132,000 km (82,000 miles) of gas distribution pipeline and we transport gas from the gas NTS to around 10.8 million consumers on behalf of 26 active gas shippers. Gas consumption in our UK networks was 304 TWh in 2010/11 compared with 299 TWh in 2009/10. |
National gas emergency number operator We manage the national gas emergency number (0800 111 999) for all the gas distribution networks and for other gas transporters in Great Britain. This service, along with the enquiries line, appliance repair helpline and meter number enquiry service, handled 2,816,403 calls during 2010/11. |
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|
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|
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Electricity distribution We own and operate electricity distribution networks in upstate New York, Massachusetts, Rhode Island and New Hampshire. Through our electricity distribution networks, we serve approximately 3.4 million electricity consumers in New England and upstate New York. We also maintain and operate the electricity transmission and distribution system on Long Island owned by the Long Island Power Authority (LIPA), providing energy to homes, |
small businesses, and large commercial and industrial enterprises. The LIPA service territory covers approximately 3,185 square km (1,230 square miles), encompassing nearly 90% of Long Islands total land area. LIPA owns approximately 2,170 km (1,350 miles) of transmission line facilities that deliver power to approximately 177 substations. From these substations, approximately 24,300 circuit km (15,100 miles) of transmission and distribution facilities distribute electricity to 1.1 million consumers. |
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|
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|
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Grain LNG Grain LNG is one of three LNG importation facilities in the UK. It was constructed in three phases, phases I and II becoming operational in 2005 and 2008 respectively and phase III being commissioned in December 2010. |
BritNed BritNed is a joint venture between National Grid and TenneT, the Dutch transmission system operator, to build and operate a 1,000 MW, 260 km (162 mile) subsea electricity link between the UK and the Netherlands. BritNed was fully commissioned and went live on 1 April 2011. |
|
Transmission US |
|||||||
|
French interconnector We own and operate the UK assets, and a portion of the subsea cables, that comprise the electricity interconnector between England and France as part of a joint arrangement with the French transmission operator. LNG storage We own and operate three liquefied natural gas (LNG) storage facilities in Great Britain. |
Electricity transmission owner We own and operate an electricity transmission network spanning upstate New York, Massachusetts, Rhode Island, New Hampshire and Vermont. Our US electricity transmission facilities operate at voltages ranging from 69 kV to 345 kV. We are the largest electricity transmission service provider in New England and New York by reference to the length of these high voltage transmission lines. |
Canadian interconnector We own and operate a 224 km (139 mile) direct current transmission line rated at 450 kV that is a key section of an interconnector between New England and Canada. |
|
Gas Distribution US |
|||
|
Gas distribution owner Our US gas distribution networks provide services to around 3.5 million consumers across the northeastern US, located in service territories in upstate New York, New York City, Long Island, Massachusetts, New Hampshire and Rhode Island. Our network of approximately 58,000 km (36,000 miles) of gas pipeline serves an area of approximately 26,400 square km (10,200 square miles). We are actively seeking to increase our customer base in these areas and in 2010/11 added more than 42,000 new gas heating customers. |
Gas storage We maintain a diversified and flexible portfolio of gas supply and storage assets, and are able to deliver additional benefits to customers and shareholders by optimising the use of these assets. During cold weather, we supplement gas from the interstate pipeline system with LNG and propane facilities in 19 locations. |
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|
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|
Electricity generation We own 57 electricity generation units on Long Island that together provide 4.1 GW of power under contract to LIPA. Our plants consist of oil and gas fired steam turbine, gas turbine and diesel driven generating units ranging from 2 MW to 385 MW. Any available power not needed to meet LIPAs requirements is made available for sale on the open market. |
|
Metering National Grid Metering and OnStream provide installation and maintenance services to energy suppliers in the regulated and unregulated markets respectively in Great Britain. OnStream also provides meter reading services. Our metering businesses provide services for an asset base of about 20 million domestic, industrial and commercial meters. |
UK Property National Grid Property is responsible for managing our occupied properties in the UK and for the management, clean up and disposal of surplus sites, most of which are former gasworks. Xoserve Xoserve delivers transactional services on behalf of all the major gas network transportation companies in Great Britain, including National Grid. Xoserve is jointly owned by National Grid, as majority shareholder, and the other gas distribution network companies. |
US non-regulated businesses Includes LNG storage, LNG road transportation, transmission pipelines and West Virginia gas fields. Corporate activities and shared services function Corporate activities comprise central overheads, insurance and expenditure incurred on business development. |
Transmission
|
| In October 2010, we finished commissioning the Wormington to Sapperton gas pipeline. This pipeline, of approximately 44 km (27 miles), is required to provide additional exit capacity in the southwest of England to meet increases in distribution network and forecast power station demand | |
On 16 November 2010, we signed our
largest ever connection contract,
with East Anglia Offshore Wind Ltd,
for the full 7.2 GW of its capacity.
The project will commission wind
turbines in 10 stages between 2015
and 2021, delivering 6.6 GW before
2020, and connects to existing
substations at Bramford and
Norwich along with a new site
to be developed in the area
|
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|
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Gas Distribution
|
| In the UK, the first release of the new Gas Distribution front office system, a significant investment in the replacement of legacy IT applications, went live in October 2010 to over 1,000 employees. The full rollout of the programme is due to be completed by spring 2012 |
|
Gas Distribution contractor safety
in the UK and US improved
substantially with the lost time injury
frequency rate reducing to 0.08
A new campaign to reduce the number of electric cable strikes was introduced in the UK and has contributed to a 10% reduction during 2010/11 |
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|
||||||||||
Electricity Distribution
& Generation |
|
We met all New York regulatory
reliability targets for the third year in a row |
| The outcome of our Niagara Mohawk rate case in upstate New York was disappointing | ||||||
|
|
By March 2011, we had delivered
$1.41 billion of the $1.47 billion
investment in New York in line
with the KeySpan merger agreement
and ahead of schedule
|
| Capital recovery mechanisms were agreed in Massachusetts, Rhode Island and New York | ||||||
|
||||||||||
Non-regulated businesses
and other
|
| On 1 December 2010, Grain LNG phase III started full commercial operation, the first operating day for all three phases at Grain. The terminal now has 1 million cubic metres of storage capacity and has a capacity of approximately 650 GWh per day | |
On 1 April 2011, BritNed successfully
achieved go live, with a capacity
of 1,000 MW along the 260 km
(162 mile) high voltage direct current
interconnector between Maasvlakte
in the Netherlands and the Isle of
Grain in the UK
|
l | the gas transportation businesses of National Grid Gas plc, consisting of the national transmission system and the retained distribution network businesses. There are also four independent distribution networks, which we previously owned and which we sold in 2005; | |
l | National Grid Metering, which is a subsidiary of National Grid Gas and manages the latters domestic and non domestic metering assets; | |
l | the electricity transmission business of National Grid Electricity Transmission plc; and | |
l | the interconnector business of National Grid Interconnectors Ltd. |
Allowed | Actual | Return | ||||||||||||||
vanilla | vanilla | on | ||||||||||||||
RAV | return | return | equity | |||||||||||||
Electricity transmission
|
£8,388m | 5.05 % | 6.40 % | 13.6 % | ||||||||||||
Gas transmission
|
£4,889m | 5.05 % | 7.20 % | 15.8 % | ||||||||||||
Gas distribution
|
£7,520m | 4.94 % | 5.54 % | 12.1 % | ||||||||||||
Total
|
£20,797m | 13.6 % |
l | a longer price control, lasting eight years, to provide stronger incentives for networks to manage costs; | |
l | encouraging network companies to work more closely with stakeholders to identify what they want from energy network companies. This should help networks to identify, and so better meet, the developing needs of the energy market; | |
l | rewarding network companies with higher returns where they meet the needs of the network users and consumers in innovative and efficient ways. However, network companies that perform poorly can expect to receive lower returns; | |
l | encouraging network companies to become actively involved in delivering a sustainable energy sector; | |
l | supporting the development and delivery of a network service that provides long-term value for money to existing and future consumers; and | |
l | providing clarity to future investors to ensure that network companies can raise the finance needed in a timely manner and at a reasonable cost to consumers. |
| Revenue decoupling | |
A mechanism that removes the link between a utilitys revenue and sales volume so that the utility is indifferent to changes in usage. Revenues are reconciled to a revenue target, with differences billed or credited to customers. Allows the utility to support energy efficiency. |
| Capital tracker |
A mechanism that allows for the recovery of the revenue requirement of incremental capital investment above that embedded in base rates, including depreciation, property taxes and a return on the incremental investment. |
§ | Commodity related bad debt true up |
A mechanism that allows the Company to reconcile commodity related bad debt to either actual commodity related bad debt or to a specified commodity related bad debt write-off percentage. For electricity utilities, this mechanism also includes working capital. |
◊ | Pension/OPEB true up |
A mechanism that reconciles the actual non capitalised costs of pension and other post-employment benefits and the actual amount recovered in base rates. The difference may be amortised and recovered over a period or deferred for a future rate case. |
l | Driving improvements in our safety, customer and operational performance | |
l | Delivering strong, sustainable regulatory and long-term contracts with good returns | |
l | Modernising and extending our transmission and distribution networks | |
l | Expanding our capabilities and identifying new financeable opportunities to grow | |
l | Becoming more efficient through transforming our operating model and increasingly aligning our processes | |
l | Building trust, transparency and an inclusive and engaged workforce | |
l | Developing our talent, leadership skills and capabilities | |
l | Positively shaping the energy and climate change agenda with our external stakeholders in both regions |
Financial KPIs | ||||
Company strategy and objectives | Financial KPIs | Definitions | ||
|
||||
Sustainable growth and superior financial
performance
|
Adjusted earnings per share | Adjusted earnings* divided by the weighted average number of shares | ||
|
||||
|
Total shareholder return | Average of the closing daily TSR levels for the 30 day period up to and including that date, assuming dividends have been reinvested | ||
Delivering strong, sustainable regulatory
and long-term contracts with good returns
|
Group return on equity |
Adjusted earnings* with certain regulatory
based adjustments divided by equity |
||
Becoming more efficient through
transforming our operating model
and increasingly aligning our processes
|
Regulated controllable operating costs | Regulated controllable operating costs, excluding bad debts, as a proportion of regulated assets | ||
|
*
|
Adjusted earnings exclude exceptional items, remeasurements and stranded cost recoveries | |
+
|
2007/08 data include continuing operations acquired with KeySpan for the period from 24 August 2007 to 31 March 2008 or as at 31 March 2008 | |
|
Comparative data have been restated for the impact of the bonus element of the rights issue and the scrip dividend issues | |
^
|
2007/08 results include KeySpan operations on a pro forma financial performance basis assuming the acquisition occurred on 1 April 2007 | |
◊
|
Prior years have been restated on a constant currency basis |
Non-financial KPIs | ||||
Company objectives | Non-financial KPIs | Definitions | ||
Modernising and extending our transmission
and distribution networks
|
Network reliability targets | Various definitions appropriate to the relevant line of business | ||
Driving improvements in our safety,
customer and operational performance
|
Customer satisfaction |
Our position in customer satisfaction
surveys |
||
|
||||
|
Employee lost time injury frequency rate | Number of employee lost time injuries per 100,000 hours worked on a 12 month basis | ||
Building trust, transparency and an inclusive
and engaged workforce
|
Employee engagement index | Employee engagement index calculated using responses to our employee survey | ||
Positively shaping the energy and climate
change agenda with our stakeholders in
both regions
|
Greenhouse gas emissions |
Percentage reduction in greenhouse gas
emissions against our 1990 baseline |
||
|
Customer satisfaction
Performance (quartile)
Measure
Target
08/09
09/10
10/11
4th
4th
4th
Quartile ranking
To improve
4th
3rd
2nd
Quartile ranking
To improve
3rd
2nd
4th
Quartile ranking
To improve
4th
4th
3rd
Quartile ranking
To improve
4th
3rd
2nd
Quartile ranking
To improve
54 | ||||
54 | ||||
55 | ||||
55 | ||||
55 | ||||
55 | ||||
55 | ||||
55 | ||||
55 | ||||
55 | ||||
55 | ||||
56 | ||||
|
||||
56 | ||||
56 | ||||
57 | ||||
57 | ||||
57 | ||||
58 | ||||
58 | ||||
58 | ||||
58 | ||||
59 | ||||
60 | ||||
61 | ||||
62 | ||||
63 | ||||
64 | ||||
65 | ||||
Comparative financial information
|
||||
66 | ||||
66 | ||||
67 | ||||
67 | ||||
68 | ||||
68 | ||||
69 | ||||
|
||||
69 | ||||
69 | ||||
69 | ||||
69 | ||||
Dividend | Proportion taking up scrip | |||
|
||||
2008/09 final
|
25% | |||
|
||||
2009/10 interim
|
20% | |||
|
||||
2009/10 final
|
23% | |||
|
||||
2010/11 interim
|
14% | |||
Years ended 31 March | ||||||||||||
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
|
||||||||||||
Revenue and other operating income
|
429 | 405 | 420 | |||||||||
|
||||||||||||
Operating costs excluding exceptional items
|
(273 | ) | (252 | ) | (245 | ) | ||||||
|
||||||||||||
Adjusted operating profits
|
156 | 153 | 175 | |||||||||
|
||||||||||||
Exceptional items
|
(2 | ) | (2 | ) | (2 | ) | ||||||
|
||||||||||||
Operating profit
|
154 | 151 | 173 | |||||||||
Years ended 31 March | ||||||||||||
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
|
||||||||||||
Revenue
|
3,811 | 3,708 | 4,786 | |||||||||
|
||||||||||||
Operating costs excluding exceptional
items and remeasurements |
(3,157 | ) | (3,294 | ) | (4,174 | ) | ||||||
|
||||||||||||
Adjusted operating profits
|
654 | 414 | 612 | |||||||||
|
||||||||||||
Exceptional items and remeasurements
|
(14 | ) | 34 | (386 | ) | |||||||
|
||||||||||||
Operating profit
|
640 | 448 | 226 | |||||||||
70 | |||||
|
|||||
70 | |||||
70 | |||||
70 | |||||
71 | |||||
71 | |||||
71 | |||||
71 | |||||
72 | |||||
72 | |||||
72 | |||||
72 | |||||
72 | |||||
73 | |||||
73 | |||||
74 | |||||
74 | |||||
|
|||||
74 | |||||
75 | |||||
75 | |||||
75 | |||||
75 | |||||
|
|||||
75 | |||||
75 | |||||
76 | |||||
76 | |||||
76 | |||||
76 | |||||
76 | |||||
76 | |||||
|
|||||
76 | |||||
|
|||||
77 | |||||
77 | |||||
77 | |||||
77 | |||||
77 | |||||
Net | ||||||||||||
Assets | Liabilities | assets | ||||||||||
£m | £m | £m | ||||||||||
Property, plant and equipment and
non-current intangible assets |
32,457 | | 32,457 | |||||||||
Goodwill and non-current investments
|
5,369 | | 5,369 | |||||||||
Current assets and liabilities
|
2,822 | (3,794 | ) | (972 | ) | |||||||
Other non-current assets and
liabilities
|
135 | (3,405 | ) | (3,270 | ) | |||||||
Post-retirement assets and
obligations
|
556 | (2,574 | ) | (2,018 | ) | |||||||
Deferred tax
|
| (3,766 | ) | (3,766 | ) | |||||||
Total before net debt
|
41,339 | (13,539 | ) | 27,800 | ||||||||
Net debt
|
5,061 | (23,792 | ) | (18,731 | ) | |||||||
Total as at 31 March 2011
|
46,400 | (37,331 | ) | 9,069 | ||||||||
Total as at 31 March 2010
|
43,553 | (39,342 | ) | 4,211 | ||||||||
* | Negative figure indicates that cash and short-term financial investments exceed debt maturities |
2011 | 2010 | |||||||
RAV gearing | % | % | ||||||
Regulated transmission and distribution businesses
within National Grid Gas plc
|
54 | 57 | ||||||
National Grid Electricity Transmission plc
|
54 | 56 | ||||||
2010/11 | 2009/10 | |||||||||||||||
Other | Other | |||||||||||||||
Income | equity | Income | equity | |||||||||||||
statement | reserves | statement | reserves | |||||||||||||
£m | £m | £m | £m | |||||||||||||
UK retail price index ±0.50%
|
19 | | 17 | | ||||||||||||
UK interest rates ±0.50%
|
38 | 50 | 51 | 71 | ||||||||||||
US interest rates ±0.50%
|
39 | 15 | 52 | 14 | ||||||||||||
US dollar exchange rate ±10%
|
44 | 636 | 68 | 623 | ||||||||||||
2010/11 | 2009/10 | |||||||||||||||
Other | Other | |||||||||||||||
Income | equity | Income | equity | |||||||||||||
statement | reserves | statement | reserves | |||||||||||||
£m | £m | £m | £m | |||||||||||||
10% increase in
|
||||||||||||||||
commodity prices
|
58 | | 71 | (1 | ) | |||||||||||
10% decrease in
|
||||||||||||||||
commodity prices
|
(54 | ) | | (64 | ) | 1 | ||||||||||
2011 | 2010* | |||||||
£m | £m | |||||||
Future capital expenditure contracted
|
||||||||
but not provided for
|
1,614 | 1,738 | ||||||
Total operating lease commitments
|
795 | 926 | ||||||
Power commitments
|
3,543 | 3,948 | ||||||
Guarantees and letters of credit
|
762 | 1,189 | ||||||
* | Comparatives have been restated to present items on a basis consistent with the current year classification |
Less | More | |||||||||||||||||||
than | 1-3 | 3-5 | than | |||||||||||||||||
1 year | years | years | 5 years | Total | ||||||||||||||||
£m | £m | £m | £m | £m | ||||||||||||||||
Financial liabilities
|
||||||||||||||||||||
Borrowings
|
2,616 | 2,762 | 2,141 | 15,314 | 22,833 | |||||||||||||||
Interest payments
on borrowings |
828 | 1,548 | 1,278 | 8,050 | 11,704 | |||||||||||||||
Finance lease liabilities
|
20 | 71 | 52 | 105 | 248 | |||||||||||||||
Other non interest-
bearing liabilities
|
2,320 | 279 | | | 2,599 | |||||||||||||||
Derivatives payments
|
1,213 | 514 | 881 | 464 | 3,072 | |||||||||||||||
Derivatives receipts
|
(1,596 | ) | (1,056 | ) | (1,151 | ) | (455 | ) | (4,258 | ) | ||||||||||
Commodity contracts
|
290 | 124 | 62 | (19 | ) | 457 | ||||||||||||||
Other contractual
obligations
|
||||||||||||||||||||
Capital commitments
|
1,217 | 294 | 92 | 11 | 1,614 | |||||||||||||||
Operating leases
|
83 | 172 | 142 | 398 | 795 | |||||||||||||||
Energy commitments
|
1,081 | 808 | 513 | 1,141 | 3,543 | |||||||||||||||
Total at 31 March 2011
|
8,072 | 5,516 | 4,010 | 25,009 | 42,607 | |||||||||||||||
= | safety, including actions taken to reduce risks and improve performance; | |
= | the rights issue and subsequent investor reaction; | |
= | reorganisation of the Company and associated changes in Executive Director responsibilities announced 31 January 2011; | |
= | risks associated with the political and regulatory landscape, including the US rate cases; and | |
= | the performance evaluation process, including how the Board and its Committees could operate more effectively. |
= | safety, as part of the Chief Executives monthly report; | |
= | monitoring implementation of the reorganisation, including progress with anticipated efficiencies and associated employee relations issues; | |
= | strategy sessions, including business development; | |
= | UK and US regulatory updates; | |
= | impact of the Bribery Act 2010; | |
= | reviewing and implementing as appropriate the recommendations of the Davies Review; | |
= | updates on the allocation of US expenses; and | |
= | monitoring and discussing progress with Ofgem on price controls. |
| corporate governance, including policy and procedure statements, codes of conduct, the Delegations of Authority, the Framework for Responsible Business and Doing the Right Thing Our Standards of Ethical Business Conduct; | |
| overall business strategy; | |
| financial policy, the budget and business plan; | |
| acquisitions or divestments; | |
| shareholder documents; | |
| Director/employee issues such as Director succession planning, with input and recommendations from the Nominations Committee; and | |
| stock exchange and listing requirements such as approval/ recommendation of dividend and approval of results announcements, interim management statements and the Annual Report and Accounts. |
| safety, health and the environment; | |
| financial status of the Company; | |
| operational headlines from the Companys businesses, together with a detailed update from one of the business areas on a rotating basis; | |
| business development and strategy implementation; | |
| external matters affecting the Company and any legal or new risk issues; | |
| reports from the Board Committees; and | |
| updates on the governance of the Company and its businesses. |
| informing them at each Board meeting of the latest training courses which may be of interest; | |
| attendance at key site visits; | |
| providing updates on legal, economic, corporate governance and best practice matters; and | |
| tailored management presentations. |
| external coaching; | |
| attendance at external training; and | |
| experience of other boardrooms through non-executive appointments. |
Area
|
Actions completed 2010/11 | ||
|
|||
Training and
development
|
Enhancement of the Non-executive Directors familiarity and interaction with each line of business. | ||
|
Responsibility: Board | ||
|
|||
|
|||
Information
and support
|
Development of a more standard presentation format for in depth line of business reviews, in order to promote consistency and ease of comparison. | ||
|
Responsibility: Executive Directors | ||
|
|||
|
|||
Information
and support
|
Greater transparency of key performance indicator data provided to the Board. | ||
|
Responsibility: Chief Executive | ||
|
|||
Area
|
Actions for 2011/12 | ||
|
|||
Training and
development
|
Ongoing review and assessment of training and development opportunities for Board members, including any areas of interest for training sessions to be delivered by internal or external parties. | ||
|
Responsibility: Board | ||
|
|||
|
|||
Board composition
|
Review and agree clarity of succession planning focus between the Nominations Committee and the Board. | ||
|
Responsibility: Board and Nominations Committee | ||
|
|||
|
|||
Role and structure
|
Continue to monitor and review advice from, and effectiveness of, advisors including appropriateness of each advisor. | ||
|
Responsibility: Remuneration and Risk & Responsibility Committees | ||
|
|||
Name | Attendance* | |
Committee chairman
|
||
Steve Holliday
|
11 of 11 | |
Executive Directors
|
||
Andrew Bonfield **
|
5 of 5 | |
Tom King
|
11 of 11 | |
Nick Winser
|
11 of 11 | |
Steve Lucas ***
|
8 of 8 | |
Mark Fairbairn ****
|
11 of 11 | |
Other members
|
||
David Lister
|
||
chief information officer
|
11 of 11 | |
Helen Mahy
|
||
Company Secretary & General Counsel
|
11 of 11 | |
George Mayhew
|
||
corporate affairs director
|
11 of 11 | |
Mike Westcott
|
||
global human resources director
|
11 of 11 | |
Alison Wood
|
||
global director of strategy and business
|
||
development
|
11 of 11 | |
Name | Attendance* | |
Committee chairman
|
||
Maria Richter
|
5 of 5 | |
Executive Directors
|
||
Steve Holliday
|
5 of 5 | |
Andrew Bonfield **
|
3 of 3 | |
Steve Lucas ***
|
3 of 3 | |
Non-executive Directors
|
||
John Allan
|
5 of 5 | |
Stephen Pettit
|
5 of 5 | |
| global director of tax and treasury; | |
| head of group tax; | |
| head of risk and insurance; | |
| global head of retirement plans; | |
| external advisors as appropriate; and | |
| management, as required. | |
Name | Attendance* | |
Committee chairman
|
||
Sir John Parker
|
5 of 5 | |
Non-executive Directors
|
||
Ken Harvey
|
5 of 5 | |
Maria Richter
|
5 of 5 | |
George Rose
|
4 of 5 | |
| Chief Executive; | |
| global human resources director; and | |
| external advisors, as required. |
Non independent | ||||
Name | Attendance* | |||
Non-executive Chairman
|
||||
Sir John Parker
|
10 of 10 | |||
Chief Executive
|
||||
Steve Holliday
|
10 of 10 | |||
Executive Directors
|
||||
Andrew Bonfield **
|
4 of 5 | |||
Tom King
|
10 of 10 | |||
Nick Winser
|
9 of 10 | |||
Steve Lucas ***
|
7 of 7 | |||
Mark Fairbairn ****
|
10 of 10 | |||
Independent | ||||
Name | Attendance* | |||
Non-executive Directors
|
||||
Ken Harvey
(Senior Independent Director)
|
10 of 10 | |||
Linda Adamany
|
10 of 10 | |||
Philip Aiken
|
10 of 10 | |||
John Allan
|
10 of 10 | |||
Stephen Pettit
|
10 of 10 | |||
Maria Richter
|
10 of 10 | |||
George Rose
|
8 of 10 | |||
* | Attendance is expressed as number of meetings attended out of number possible or applicable for the individual Director |
** | Andrew Bonfield was appointed to the Board on 1 November 2010 |
*** | Steve Lucas retired on 31 December 2010 |
**** | Mark Fairbairn left the Company on 31 March 2011 |
Name | Attendance* | |||
Committee chairman
|
||||
John Allan
|
9 of 9 | |||
Non-executive Directors
|
||||
Ken Harvey
|
9 of 9 | |||
Stephen Pettit
|
9 of 9 | |||
George Rose
|
8 of 9 | |||
| Chairman; | |
| Chief Executive; | |
| global human resources director and global head of compensation & benefits; and | |
| independent external advisors. |
Name | Attendance* | |||
Committee chairman
|
||||
Stephen Pettit
|
4 of 4 | |||
Non-executive Directors
|
||||
Linda Adamany
|
4 of 4 | |||
Philip Aiken
|
4 of 4 | |||
Ken Harvey
|
4 of 4 | |||
| Chief Executive; | |
| Company Secretary & General Counsel; | |
| director of UK safety, health and environment; | |
| US senior VP safety, health, environmental services; | |
| Executive Directors, as appropriate; and | |
| director of corporate audit or corporate affairs director on an alternate basis. |
Name | Attendance* | |
Committee chairman
|
||
George Rose
|
6 of 6 | |
Non-executive Directors
|
||
Linda Adamany
|
6 of 6 | |
Philip Aiken
|
6 of 6 | |
Maria Richter
|
6 of 6 | |
| external auditors; | |
| Chairman; | |
| Chief Executive; | |
| Finance Director; | |
| director of corporate audit, financial controller, Company Secretary & General Counsel; and | |
| other Executive Directors, global director of tax and treasury, chief accountant and global head of risk management, as appropriate. |
Disclosure committee | See page 88 |
|
the financial, operational, safety and environmental performance of the Company and its
businesses, including process safety improvements;
|
||
|
strategic business development and implementation, in particular the redesign of our
organisational structure;
|
||
|
approving capital and operational expenditure under the authorities delegated to it by the Board;
|
||
|
global regulatory matters, including the UK price controls RIIO T1 and RIIO GD1, and US rate
filings;
|
||
|
business conduct, risk and compliance reports, including adequacy and effectiveness of internal
control and risk management;
|
||
|
employee issues such as inclusion and diversity, employee reward and succession planning; and
|
||
|
global information systems strategic issues.
|
|
transaction structure for the rights issue;
|
||
|
debt management policy, with policy changes to take advantage of market conditions, an external
presentation on the 2010 debt capital markets and key drivers for 2011;
|
||
|
UK and US tax strategy;
|
||
|
activities of the energy procurement risk management committee in the US;
|
||
|
pensions update, including the funding status of all plans, discussions on actions to address
funding deficits and their treatment in price control reviews;
|
||
|
insurance, including a review of premium levels and liability policy limits; and
|
||
|
approved financing to meet the Companys anticipated increased role in US energy efficiency
programmes.
|
|
the size of the Board, its structure and composition;
|
||
|
aspects of the performance evaluation process, see pages 82 and 83 for details;
|
||
|
ongoing succession planning for Board members and senior management; and
|
||
|
development plans for senior management, as proposed by the Chief Executive and global human
resources director.
|
| impact of the rights issue on the employee share plans, including on the earnings per share performance condition in the Performance Share Plan; | ||
| salary review proposals and performance objectives; | ||
| compensation and benefit arrangements for departing and new Executive Directors; | ||
| market trends in remuneration and benchmarking of individual roles; | ||
| long-term ill health benefits within the defined contribution section of The National Grid UK Pension Scheme; and | ||
| impact of UK income tax relief changes on pensions. |
| serious incident and near miss reports, such as an electric arc flash incident at a US substation, noting root causes and associated learning; | ||
| climate change strategy, performance against targets and the challenges related to Scope III emissions; | ||
| safety, health and environment audit plans and findings from such audits; | ||
| progress toward embedding a security culture and actions being taken to improve digital and asset security; | ||
| changes in the non-financial risk profile of the Company; and | ||
| findings from the new external safety advisor and subsequent response from management. |
| developments in the US finance environment including recruitment to strengthen capabilities; | ||
| accounting for goodwill, including an outline of the approach adopted for goodwill impairment testing; | ||
| implications of the Bribery Act 2010, including a review of policies and procedures to ensure adequate controls are in place; | ||
| the risk management process in Transmission, noting the principal risks; and | ||
| the rights issue, including the transaction structure and the external auditors review of working capital projections. |
| the receipt of a Letter of Assurance from the Chief Executive, which consolidates key matters of interest raised through the year-end assurance process; | |
| assurance from its Committees as appropriate, with particular reference to the reports received from the Audit Committee and Risk & Responsibility Committee on the reviews undertaken at their respective meetings; and | |
| assurances in relation to the certifications required under the Sarbanes-Oxley Act 2002 as a result of the Companys NYSE listing. |
|
||
Changes in law or
regulation and
decisions by
governmental bodies
or regulators
|
Many of our businesses are utilities or networks that are subject to regulation by governments and other authorities.
Changes in law or regulation or regulatory policy and precedent in the countries or states in which we operate (including the new RIIO approach in the UK) could materially adversely affect us. Decisions or rulings concerning, for example:
whether licences, approvals or agreements to operate or supply are granted or are renewed or whether
there has been any breach of the terms of a licence, approval or regulatory requirement; and
timely recovery of incurred expenditure or obligations, the ability to pass through commodity costs, a
decoupling of energy usage and revenue and other decisions relating to the impact of general economic conditions on
us, our markets and customers, implications of climate change, remuneration for stranded assets, the level of
permitted revenues and dividend distributions for our businesses and in relation to proposed business development
activities,
could have a material adverse impact on our results of operations, cash flows, the financial condition of our businesses and the ability to develop those businesses in the future. For further information, see the Operating and Financial Review and, in particular, the operating environment section. |
|
|
||
Potentially harmful
activities, the
environment and
climate change
|
Aspects of our activities are potentially dangerous and could potentially harm members of the public and our
employees, such as the operation and maintenance of electricity generation facilities and electricity lines and the
transmission and distribution of gas. We are subject to laws and regulations in the UK and US governing health and
safety matters protecting the public and our employees. Electricity and gas utilities also typically use and generate
in their operations hazardous and potentially hazardous products and by-products. In addition, there may be other
aspects of our operations that are not currently regarded or proved to have adverse effects but could become so, such
as the effects of electric and magnetic fields.
We are subject to laws and regulations relating to pollution, the protection of the environment, and the use and disposal of hazardous substances and waste materials. These expose us to costs and liabilities relating to our operations and our properties whether current, including those inherited from predecessor bodies, or formerly owned by us and sites used for the disposal of our waste. The cost of future environmental remediation obligations is often inherently difficult to estimate and uncertainties can include the extent of contamination, the appropriate corrective actions and our share of the liability. We are increasingly subject to regulation in relation to climate change and are affected by requirements to reduce our own carbon emissions as well as reduction in energy use by our customers. We commit significant expenditure toward complying with these laws and regulations and to meeting our obligations under negotiated settlements. If additional requirements are imposed, or our ability to recover these costs under regulatory frameworks changes, this could have a material adverse impact on our businesses, results of operations and financial position. Furthermore, any breach of our regulatory or contractual obligations, or our climate change targets, or even incidents that do not amount to a breach, could materially adversely affect our results of operations and our reputation. For further information about environmental, climate change and health and safety matters relating to our businesses, see the Corporate responsibility section of our website at www.nationalgrid.com. |
|
|
||
Network failure or
interruption, the
inability to carry
out critical non
network operations
and damage to
infrastructure
|
We may suffer a major network failure or interruption or may not be able to carry out critical non network
operations. Operational performance could be materially adversely affected by a failure to maintain the health of the
system or network, inadequate forecasting of demand, inadequate record keeping or control of data or failure of
information systems and supporting technology. This could cause us to fail to meet agreed standards of service or
incentive and reliability targets or be in breach of a licence, approval, regulatory requirement or contractual
obligation, and even incidents that do not amount to a breach could result in adverse regulatory and financial
consequences, as well as harming our reputation.
In addition to these risks, we may be affected by other potential events that are largely outside our control such as the impact of weather (including as a result of climate change), unlawful or unintentional acts of third parties, insufficient supply or force majeure. Weather conditions, including prolonged periods of adverse weather, can affect financial performance and severe weather that causes outages or damages infrastructure will materially adversely affect operational and potentially business performance and our reputation. Malicious attack, sabotage or other intentional acts may also damage our assets or affect corporate activities and as a consequence have a material adverse impact on our results of operations and financial condition. Even where we establish business continuity controls, these may not be sufficient. |
Furthermore, our cash flow may be
materially affected as a result
of settling hedging arrangements
entered into to manage our
exchange rate, commodity and
interest rate exposure, or by
cash collateral movements
relating to derivative market
values, which also depend on euro
and other exchange rates. For
further information see the
financial performance section of
the Operating and Financial
Review.
Financial markets can be subject
to periods of volatility and
shortages of liquidity and, if we
were unable to access the capital
markets or other sources of
finance at competitive rates for
a prolonged period, our cost of
financing may increase, the
uncommitted and discretionary
elements of our proposed capital
investment programme may need to
be reconsidered and the manner in
which we implement our strategy
may need to be reassessed. The
occurrence of any such events
could have a material adverse
impact on our business, results
of operations and prospects.
In addition, National Grid plc is
a holding company and, as such,
has no revenue generating
operations of its own. As a
result, National Grid plc depends
on (i) the earnings and cash
flows of its operating
subsidiaries, (ii) the ability of
its subsidiaries to pay dividends
(which may be restricted due to
legal or regulatory constraints
or otherwise), (iii) subsidiaries
repaying funds due to it and (iv)
the maintenance by its
subsidiaries of certain minimum
credit ratings (which also depend
on the credit rating of National
Grid plc). If National Grid plcs
subsidiaries are unable to
achieve any of the foregoing,
National Grid plc may be unable
to pay dividends and there may be
a material adverse impact on its
operations, costs associated with
financing or its ability to
access the capital markets or
other forms of bank financing at
competitive rates.
Funding of our pension schemes and
other post- retirement benefits
|
We participate in a number of
pension schemes that together cover
substantially all our employees. In
both the UK and US, the principal
schemes are defined benefit schemes
where the scheme assets are held
independently of our own financial
resources. In the US, we also have
other post-retirement benefit
schemes. Estimates of the amount
and timing of future funding for
these schemes are based on
actuarial assumptions and other
factors including the actual and
projected market performance of the
scheme assets, future long-term
bond yields, average life
expectancies and relevant legal
requirements. The impact of these
assumptions and other factors may
require us to make additional
contributions to these pension
schemes which, to the extent they
are not recoverable under our price
controls or state rate plans, could
materially adversely affect our
results of operations and financial
condition.
|
|
|
||
Customers and counterparty risk
|
Our operations are exposed to the
risk that customers and
counterparties to our transactions
that owe us money or commodities
will not perform their obligations,
which could materially adversely
affect our financial position. This
risk is most significant where our
subsidiaries have concentrations of
receivables from gas and
electricity utilities and their
affiliates, as well as industrial
customers and other purchasers and
may also arise where customers are
unable to pay us as a result of
increasing commodity prices or
adverse economic conditions.
A substantial portion of our US electricity distribution and generation businesss revenues are derived from a series of agreements with the Long Island Power Authority (LIPA) pursuant to which we manage LIPAs transmission and distribution system and supply the majority of LIPAs generating capacity. These agreements are largely scheduled to expire in 2013. If these agreements are not renewed, our income may be reduced and we may suffer stranded costs, for which we may not be remunerated. |
|
|
||
Employees and others
|
Our ability to implement our
long-term business strategy depends
on the capabilities and performance
of our personnel. Loss of key
personnel or an inability to
attract, train or retain
appropriately qualified personnel
(in particular for technical
positions where availability of
appropriately qualified personnel
may be limited), or if significant
disputes arise with our employees,
our ability to implement our
long-term business strategy may be
affected and there may be a
material adverse effect on our
business, financial condition,
results of operations and
prospects.
There is a risk that an employee or someone acting on our behalf commits a breach of anti-bribery legislation or otherwise commits a breach of our internal controls or internal governance framework. This could impact our results of operations, our reputation and our relationship with our regulators and other stakeholders. |
|
|
||
Seasonal fluctuations
|
Our electricity and gas businesses
are seasonal businesses and are
subject to weather conditions. In
particular, revenues from our gas
distribution networks in the US are
weighted towards the end of our
financial year, when demand for gas
increases due to colder weather
conditions. As a result, we are
subject to seasonal variations in
working capital because we purchase
gas supplies for storage in the
first half of our financial year
and must finance these purchases.
Accordingly, our results of
operations for this business
fluctuate substantially on a
seasonal basis. In addition,
portions of our electricity
businesses are seasonal and subject
to weather and weather related
market conditions. Sales of
electricity to customers are
influenced by temperature changes.
Significant changes in heating or
cooling requirements, for example,
could have a substantial effect. As
a result, fluctuations in weather
and competitive supply between
years may have a significant effect
on our results of operations for
both gas and electricity
businesses.
|
Size of | Number of | % of | Number of | % of | ||||||||||||
shareholding | shareholders | shareholders | shares | shares | ||||||||||||
150
|
190,832 | 17.3231 | 5,656,922 | 0.1551 | ||||||||||||
51100
|
309,117 | 28.0606 | 21,879,729 | 0.5997 | ||||||||||||
101500
|
475,163 | 43.1337 | 98,764,846 | 2.7071 | ||||||||||||
5011,000
|
62,591 | 5.6818 | 43,761,154 | 1.1995 | ||||||||||||
1,00110,000
|
60,728 | 5.5127 | 148,499,028 | 4.0703 | ||||||||||||
10,00150,000
|
2,095 | 0.1902 | 37,952,684 | 1.0403 | ||||||||||||
50,001100,000
|
204 | 0.0185 | 14,789,851 | 0.4054 | ||||||||||||
100,001500,000
|
424 | 0.0385 | 101,943,724 | 2.7942 | ||||||||||||
500,0011,000,000
|
155 | 0.0140 | 114,266,975 | 3.1320 | ||||||||||||
1,000,001+
|
296 | 0.0269 | 3,060,824,562 | 83.8964 | ||||||||||||
Total
|
1,101,605 | 100 | 3,648,339,475 | 100 | ||||||||||||
% of voting rights | ||||
Black Rock Inc
|
5.21 | |||
Capital Group Companies, Inc
|
5.04 | |||
Crescent Holding GmbH
|
4.31 | |||
Legal and General Group plc
|
3.99 | |||
| different tests of independence for Board members are applied under the Code and Section 303A; | |
| there is no requirement for a separate corporate governance committee in the UK; all Directors on the Board discuss and decide upon governance issues and the Nominations Committee makes recommendations to the Board with regard to certain of the responsibilities of a corporate governance committee; | |
| while the Company reports compliance with the Code in each Annual Report and Accounts, there is no requirement to adopt and disclose separate corporate governance guidelines; and | |
| while the Audit Committee, having a membership of four independent Non-executive Directors, exceeds the minimum membership requirements under Section 303A of three independent Non-executive Directors, it should be noted that the quorum for a meeting of the Audit Committee, of two independent Non-executive Directors, is less than the minimum membership requirements under Section 303A. |
\
| Towers Watson, independent remuneration advisors. It also provides general remuneration and benefits advice to the Company. In this respect, the Remuneration Committee is satisfied that any potential conflicts are appropriately managed. The Remuneration Committee has carefully reviewed the voluntary code of conduct in relation to executive consulting in the UK; |
| Alithos Limited, provision of Total Shareholder Return calculations for the Performance Share Plan; |
| Linklaters LLP, advice relating to Directors service contracts as well as providing other legal advice to the Company; and |
| KPMG LLP, advice relating to pension taxation legislation. |
| total rewards should be set at levels that are competitive in the relevant market. For UK-based Executive Directors, the primary focus is placed on companies ranked (in terms of market capitalisation) 11-40 in the FTSE 100. This peer group is therefore weighted towards companies smaller than National Grid and positioning the package slightly below median against this group is considered to be appropriate for a large, international but predominately regulated business. For US-based Executive Directors, the primary focus is placed on US utility companies; | |
| a significant proportion of the Executive Directors total reward should be performance based. Performance based incentives will be earned through the achievement of demanding targets for short-term business and individual performance as well as long-term shareholder value creation, consistent with our Framework for Responsible Business which can be found at: www.nationalgrid.com/corporate/About+Us/ CorporateGovernance/Other; | |
| for higher levels of performance, rewards should be substantial but not excessive; | |
| incentive plans, performance measures and targets should be stretching and aligned as closely as possible with shareholders long-term interests; and | |
| remuneration structures should motivate employees to enhance the Companys performance without encouraging them to take undue risks, whether financial or operational. |
| salary; | |
| Annual Performance Plan including the Deferred Share Plan; | |
| long-term incentive, the Performance Share Plan, to be replaced by the Long Term Performance Plan; | |
| all-employee share plans; | |
| pension contributions; and | |
| non-cash benefits. |
Level of performance achieved in 2010/11 | ||
as determined by the Remuneration Committee | ||
Financial measures | Company targets | Divisional targets |
Adjusted EPS
|
Between target and stretch | |
Consolidated cash flow
|
Stretch | |
Regulated controllable costs
|
Between target and stretch | |
Operating profit
|
Varied performance
(i), (ii) |
|
Line of business returns targets
|
Varied performance
(iii), (iv), (v) |
|
(i) | Transmission and Gas Distribution between target and stretch. | |
(ii) | Electricity Distribution & Generation at stretch. | |
(iii) | Transmission between target and stretch, UK and US. | |
(iv) | Gas Distribution between threshold and target (UK), at stretch (US). | |
(v) | Electricity Distribution & Generation at stretch (US only). |
| Sharesave: Employees resident in the UK, including UK-based Executive Directors, are eligible to participate in HM Revenue & Customs approved all-employee Sharesave schemes. Under these schemes, participants may contribute between £5 and £250 in total each month, for a fixed period of three years, five years or both. Contributions are taken from net salary. At the end of the savings period, these contributions can be used to purchase ordinary shares in National Grid at a discount capped at 20% of the market price set at the launch of each scheme. | |
| Share Incentive Plan (SIP): Employees resident in the UK, including UK-based Executive Directors, are eligible to participate in the SIP. Contributions up to £125 are deducted from participants gross salary and used to purchase ordinary shares in National Grid each month. The shares are placed in trust and if they are left in trust for at least five years, they can be removed free of UK income tax and National Insurance Contributions. | |
| US Incentive Thrift Plans: Employees of National Grids US companies (including US-based Executive Directors) are eligible to participate in the Thrift Plans, which are tax-advantaged savings plans (commonly referred to as 401(k) plans). These are defined contribution pension plans that give participants the opportunity to invest up to applicable Federal salary limits ie for pre-tax contributions, a maximum of 50% of salary limited to $16,500 for those under the age of 50 and $22,000 for those over 50 for calendar years 2010 and 2011; for post-tax contributions, up to 15% of salary limited to the lesser of 100% of compensation or $49,000 for calendar years 2010 and 2011. Employees may invest their own and Company contributions in National Grid shares or various mutual fund options. | |
With effect from 1 January 2011, the Company matches 50% of the first 8% of salary contributed. Prior to that, the Company matched 100% of the first 2% and 75% of the next 4% of salary contributed, resulting in a maximum matching contribution of 5% of salary up to the Federal salary cap. For employees in legacy KeySpan plans, the Company matched 50% of the first 6% of salary contributed. With effect from 1 January 2011, the Company no longer provides a discount to purchase Company |
stock, however, prior to this date legacy KeySpan employees invested in National Grid shares at a 10% discount. | ||
| Employee Stock Purchase Plan (ESPP): Employees of National Grids US companies (including US-based Executive Directors) are eligible to participate in the ESPP (commonly referred to as a 423b plan). Eligible employees have the opportunity to purchase ADSs on a monthly basis at a 10% discounted price. Under the plan employees may contribute up to 20% of base pay each year up to a maximum annual contribution of $18,888 to purchase ADSs in National Grid. Any ADSs purchased through the ESPP may be sold at any time, however, there are tax advantages for ADSs held for at least two years from the offer date. |
Date of contract | Notice period | |||
Executive Directors
|
||||
Steve Holliday
|
1 April 2006 | 12 months | ||
Andrew Bonfield (i)
|
1 November 2010 | 12 months | ||
Nick Winser
|
28 April 2003 | 12 months | ||
Tom King
|
11 July 2007 | 12 months | ||
Steve Lucas (ii)
|
13 June 2002 | 12 months | ||
Mark Fairbairn (iii)
|
23 January 2007 | 12 months | ||
(i) | Andrew Bonfield joined the Board on 1 November 2010. | |
(ii) | Steve Lucas retired from the Board on 31 December 2010. | |
(iii) | Mark Fairbairn left the Company on 31 March 2011. |
Retained | ||||||||
Company | fees (£) | |||||||
Executive Directors
|
||||||||
Steve Holliday
|
Marks and Spencer Group plc | 81,000 | ||||||
Andrew Bonfield (i)
|
Kingfisher plc | 30,000 | ||||||
Nick Winser
|
Kier Group plc | 43,000 | ||||||
Steve Lucas (ii)
|
Compass Group PLC | 71,000 | ||||||
(i) | Andrew Bonfields paid external appointment was taken up prior to joining the Board on 1 November 2010. The retained fees shown reflect the period 1 November 2010 to 31 March 2011. | |
(ii) | The retained fees for Steve Lucas reflect the period 1 April 2010 to 31 December 2010 when he was an Executive Director of National Grid. |
Date of | ||||
appointment | Date of next | |||
to the Board | election | |||
Non-executive Directors
|
||||
Sir John Parker
|
21 October 2002 | 2011 AGM | ||
Ken Harvey
|
21 October 2002 | 2011 AGM | ||
Linda Adamany
|
1 November 2006 | 2011 AGM | ||
Philip Aiken
|
15 May 2008 | 2011 AGM | ||
John Allan
|
1 May 2005 | | ||
Stephen Pettit
|
21 October 2002 | 2011 AGM | ||
Maria Richter
|
1 October 2003 | 2011 AGM | ||
George Rose
|
21 October 2002 | 2011 AGM | ||
Year ended | ||||||||||||||||||||||||||||
31 March | ||||||||||||||||||||||||||||
Table 1A | Year ended 31 March 2011 | 2010 | ||||||||||||||||||||||||||
Annual | Benefits | Benefits | ||||||||||||||||||||||||||
Performance | in kind (ii) | in kind (ii) | Other | |||||||||||||||||||||||||
Salary (i) | Plan | (cash) | (non-cash) | emoluments | Total | Total | ||||||||||||||||||||||
£000s | £000s | £000s | £000s | £000s | £000s | £000s | ||||||||||||||||||||||
Executive Directors
|
||||||||||||||||||||||||||||
Steve Holliday
|
946 | 1,154 | 12 | 14 | | 2,126 | 2,273 | |||||||||||||||||||||
Andrew Bonfield (iii)
|
281 | 346 | 83 | 1 | | 711 | | |||||||||||||||||||||
Nick Winser
|
482 | 573 | | 15 | | 1,070 | 1,129 | |||||||||||||||||||||
Tom King (iv)
|
684 | 855 | 5 | 17 | | 1,561 | 1,582 | |||||||||||||||||||||
Steve Lucas (v)
|
375 | 500 | | 12 | 201 | 1,088 | 1,270 | |||||||||||||||||||||
Mark Fairbairn (iii),
(vi), (vii)
|
469 | 540 | 2 | 13 | | 1,024 | 1,002 | |||||||||||||||||||||
Total
|
3,237 | 3,968 | 102 | 72 | 201 | 7,580 | 7,256 | |||||||||||||||||||||
(i) | With effect from 1 June 2011, the Executive Directors salaries are as follows: Steve Holliday £975,000; Andrew Bonfield £695,000; Nick Winser £530,000 and Tom King £714,740. |
(ii) | Benefits in kind comprise benefits such as private medical insurance, life assurance, either a fully expensed car or cash in lieu of a car and the use of a driver when required. In the case of Andrew Bonfield, a cash allowance in lieu of additional Company pension contributions is included (see Table 2 for further details). |
(iii) | These Executive Directors participate in the UK flexible benefits plan which operates by way of salary sacrifice, therefore, their salaries are reduced by the benefits they have purchased. The value of these benefits is included in the Benefits in kind (non-cash) figure. The values are: Andrew Bonfield £155.68 and Mark Fairbairn £543.36. |
(iv) | For the US-based Executive Director, the exchange rate averaged over the year 1 April 2010 to 31 March 2011 to convert dollars to UK pounds sterling is $1.574:£1. |
(v) | Steve Lucas left National Grid on 31 December 2010. He had a contractual entitlement of one years salary on leaving, of which he worked three months. He therefore was entitled to nine months salary, which is payable in six monthly instalments and is subject to mitigation, at the Remuneration Committees discretion, should he take employment during the period. Payment of £201,000 referred to above in Other emoluments reflects the first three months of those instalments. |
(vi) | Mark Fairbairn left National Grid on 31 March 2011. He had a contractual entitlement to one years salary on leaving, of which he worked two months. He therefore was entitled to 10 months salary, which is payable in six monthly instalments and is subject to mitigation, at the Remuneration Committees discretion, should he take employment during the period. |
(vii) | In addition to the amounts shown in the above table, Mark Fairbairn, on leaving, was entitled to a statutory redundancy payment of £10,200. |
Year ended | ||||||||||||||||
31 March | ||||||||||||||||
Table 1B | Year ended 31 March 2011 | 2010 | ||||||||||||||
Other | ||||||||||||||||
Fees | emoluments | Total | Total | |||||||||||||
£000s | £000s | £000s | £000s | |||||||||||||
Non-executive Directors
|
||||||||||||||||
Sir John Parker (i)
|
550 | 71 | 621 | 615 | ||||||||||||
Ken Harvey
|
83 | | 83 | 80 | ||||||||||||
Linda Adamany
|
74 | | 74 | 78 | ||||||||||||
Philip Aiken
|
68 | | 68 | 68 | ||||||||||||
John Allan
|
81 | | 81 | 82 | ||||||||||||
Stephen Pettit
|
83 | | 83 | 82 | ||||||||||||
Maria Richter
|
89 | | 89 | 94 | ||||||||||||
George Rose
|
79 | | 79 | 81 | ||||||||||||
Total
|
1,107 | 71 | 1,178 | 1,180 | ||||||||||||
(i) | Sir John Parkers Other emoluments comprise private medical insurance, life assurance and a fully expensed car. |
Transfer value | ||||||||||||||||||||||||||||
of increase in | ||||||||||||||||||||||||||||
accrued benefit in | ||||||||||||||||||||||||||||
Additional benefit | Additional benefit | the year ended | ||||||||||||||||||||||||||
earned during | Accrued | Transfer value of accrued | earned in the year | 31 March 2011 | ||||||||||||||||||||||||
year ended | entitlement as at | benefits as at 31 March (i) | Increase in transfer | ended 31 March 2011 | (excluding inflation | |||||||||||||||||||||||
31 March 2011 | 31 March 2011 | value less Director's | (excluding inflation) | & Director's | ||||||||||||||||||||||||
pension | pension | 2011 | 2010 | contributions (ii) | pension | contributions) (ii) | ||||||||||||||||||||||
Table 2 | £000s | £000s | £000s | £000s | £000s | £000s | £000s | |||||||||||||||||||||
Steve Holliday (iii)
|
39 | 352 | 7,122 | 5,995 | 1,127 | 24 | 478 | |||||||||||||||||||||
Andrew Bonfield (iv)
|
| | | | | | | |||||||||||||||||||||
Nick Winser (v)
|
18 | 215 | 3,888 | 3,379 | 509 | 9 | 157 | |||||||||||||||||||||
Tom King (vi)
|
62 | 222 | 1,212 | 832 | 380 | 62 | 341 | |||||||||||||||||||||
Steve Lucas (vii)
|
30 | 299 | 6,985 | 6,006 | 979 | 23 | 543 | |||||||||||||||||||||
Mark Fairbairn (viii)
|
30 | 229 | 7,200 | 3,714 | 3,486 | 21 | 657 | |||||||||||||||||||||
(i) | The transfer values shown at 31 March 2010 and 2011 represent the value of each Executive Directors accrued benefits based on total service to the relevant date. Transfer values for the UK-based Executive Directors have been calculated in line with transfer value bases agreed by the UK Pension Scheme Trustees. The transfer values for the US-based Executive Director have been calculated using discount rates based on high quality US corporate bonds and associated yields at the relevant dates. |
(ii) | The UK-based Executive Directors participate in Flexible Pension Savings (FPS), a salary sacrifice arrangement, the effects of which have not been taken into account in the table above. Contributions paid via FPS should be deducted from the figures shown above. |
(iii) | In addition to the pension above, for Steve Holliday there is an accrued lump sum entitlement of £111,000 as at 31 March 2011. The increase to the accumulated lump sum including inflation was £2,000 and excluding inflation was nil in the year to 31 March 2011. The transfer value information above includes the value of the lump sum. Contributions were paid via FPS of £19,000. |
(iv) | Andrew Bonfield does not participate in either of the Companys defined benefit pension arrangements. Andrew joined the Defined Contribution Section of the National Grid UK Pension Scheme and the Company has made contributions of £9,000 to this arrangement. In addition, £4,500 was paid via FPS. Andrew also received a cash allowance in lieu of additional Company contributions equal to 26% of base salary. This allowance is included in Table 1A on page 103. |
(v) | In addition to the pension above, for Nick Winser there is an accrued lump sum entitlement of £271,000 as at 31 March 2011. The increase to the accumulated lump sum including inflation was £11,000 and excluding inflation was nil in the year to 31 March 2011. The transfer value information above includes the value of the lump sum. Contributions were paid via FPS of £29,000. |
(vi) | For Tom King, the exchange rate as at 31 March 2011 was $1.60700:£1 and as at 31 March 2010 was $1.51845:£1. In addition to the pension quoted above, through participation in the 401(k) plan in the US, the Company made contributions worth £5,497 to a defined contribution arrangement. |
(vii) | Contributions were paid via FPS of £24,000. It was agreed that £293,000, representing the value of 52,984 shares which Steve Lucas would otherwise have received in respect of his PSP awards (see Table 4 on page 107), instead be transferred into his pension fund. This is equivalent to nine months additional pension credit and is included above. Steve received a deferred pension on cessation of employment. He opted to take an immediate pension which was reduced for early retirement under the standard terms of the Trust Deed and Rules of the Pension Scheme. |
(viii) | In addition to the pension above, for Mark Fairbairn there is an accrued lump sum entitlement of £306,000 as at 31 March 2011. The increase to the accumulated lump sum including inflation was £26,000 and excluding inflation was £13,000 in the year to 31 March 2011. The transfer value information above includes the value of the lump sum. Contributions were paid via FPS of £28,000. Mark left the Company on 31 March 2011 and received an immediate unreduced pension on cessation of employment under the standard redundancy terms of the Trust Deed and Rules of the Pension Scheme. |
Adjusted no. of | ||||||||||||||||||||||||||||
options held | Adjusted no. | Adjusted no. of | ||||||||||||||||||||||||||
at 1 April | options | Options | options held at | Adjusted | ||||||||||||||||||||||||
2010 or, if later, | exercised or | Market price at | granted | 31 March 2011 | exercise price | |||||||||||||||||||||||
on appointment * | lapsed during | exercise | during | or, if earlier, on | per share | |||||||||||||||||||||||
Table 3 | (i) | the year (i) | (pence) | the year | retirement (i) | (pence) (ii) | Normal exercise period | |||||||||||||||||||||
Steve Holliday
|
||||||||||||||||||||||||||||
ESOP
|
77,129 | | | | 77,129 | 421.36 | Jun 2005 to Jun 2012 | |||||||||||||||||||||
Share Match
|
11,827 | | | | 11,827 | 100 in total | Jun 2005 to Jun 2012 | |||||||||||||||||||||
|
16,092 | | | | 16,092 | 100 in total | Jun 2006 to Jun 2013 | |||||||||||||||||||||
|
21,383 | | | | 21,383 | nil | May 2007 to May 2014 | |||||||||||||||||||||
Sharesave
|
3,921 | | | | 3,921 | 427.05 | Apr 2014 to Sep 2014 | |||||||||||||||||||||
Total
|
130,352 | | | 130,352 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Andrew Bonfield
|
||||||||||||||||||||||||||||
Sharesave
|
* | | | 3,421 | 3,421 | 445 | Apr 2016 to Sep 2016 | |||||||||||||||||||||
Total
|
* | | 3,421 | 3,421 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Steve Lucas (iii)
|
||||||||||||||||||||||||||||
ESOP
|
62,167 (iv) | | | | 62,167 | 380.02 | Jan 2011 to Dec 2011 | |||||||||||||||||||||
Sharesave
|
3,416 (iv) | | | | 3,416 | 455.06 | Jan 2011 to Jun 2011 | |||||||||||||||||||||
Total
|
65,583 | | | 65,583 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Mark Fairbairn (iii)
|
||||||||||||||||||||||||||||
Sharesave
|
2,011 (v) | | | | 2,011 | 488.31 | Apr 2011 to Sep 2011 | |||||||||||||||||||||
|
585 (v) | | | | 585 | 573.19 | Apr 2011 to Sep 2011 | |||||||||||||||||||||
Total
|
2,596 | | | 2,596 | ||||||||||||||||||||||||
(i) | The option numbers shown, for awards granted prior to the rights issue which completed on 14 June 2010, were adjusted using an adjustment factor of 1.14271765. |
(ii) | The exercise prices shown above, for awards granted prior to the rights issue which completed on 14 June 2010, were adjusted using an adjustment factor of 0.87510681. |
(iii) | On 1 April 2010, the first day of the financial year, Steve Lucas and Mark Fairbairn exercised Sharesave options over 1,693 and 862 shares respectively as reported in footnote (i) of Table 3 of the 2009/10 Directors Remuneration Report. As a result, these options were not adjusted for the rights issue which completed on 14 June 2010 and are not included in this table. |
(iv) | On leaving, Steve Lucas was permitted 12 months from his termination date in which to exercise his ESOP options and six months to exercise his Sharesave options. |
(v) | On leaving, Mark Fairbairn was permitted six months from his termination date in which to exercise his Sharesave options. |
Adjusted no. of | ||||||||||||||||||||||||||||||||||||||||
PSP, DSP | ||||||||||||||||||||||||||||||||||||||||
and SRA | ||||||||||||||||||||||||||||||||||||||||
conditional | Adjusted | Adjusted no. of | ||||||||||||||||||||||||||||||||||||||
awards at | Adjusted no. of | Adjusted no. of | market price | conditional awards | ||||||||||||||||||||||||||||||||||||
1 April 2010 or, if | awards | awards | Release | at award | at 31 March 2011 | |||||||||||||||||||||||||||||||||||
later, on | lapsed | vested | of PSP | (pence | or, if earlier, on | |||||||||||||||||||||||||||||||||||
Type of | appointment * | during year | in year | awards | Awards granted | except #) | retirement | |||||||||||||||||||||||||||||||||
Table 4 | award | (i) | (i) | (i) | in year | during year | (ii) | Date of award | (i) | Release date | ||||||||||||||||||||||||||||||
Steve Lucas | ||||||||||||||||||||||||||||||||||||||||
|
PSP | 97,051 | 33,822 (iii) | 63,229 (iii) | | | 648.24 | Jun 2007 | 63,229 | Jan 2011 | ||||||||||||||||||||||||||||||
|
PSP | 53,850 | 18,767 (iii) | 35,083 (iii) | | | 700.95 | Nov 2007 | 35,083 | Jan 2011 | ||||||||||||||||||||||||||||||
|
PSP | 179,619 (viii) | | | | | 584.57 | Jun 2008 | 179,619 | Jan 2011 | ||||||||||||||||||||||||||||||
|
PSP | 222,039 (viii) | | | | | 472.89 | Jun 2009 | 222,039 | Jan 2011 | ||||||||||||||||||||||||||||||
|
PSP | | | | | 216,579 (viii) | 494.5076 | Jun 2010 | 216,579 | Jan 2011 | ||||||||||||||||||||||||||||||
|
DSP | 54,008 (ix) | | | | | 610.37 | Jun 2008 | 54,008 | Jan 2011 | ||||||||||||||||||||||||||||||
|
DSP | 38,656 (iv), (ix) | | | | | 541.14 | Jun 2009 | 38,656 | Jan 2011 | ||||||||||||||||||||||||||||||
|
DSP | | | | | 72,073 (ix) | 506.294 | Jun 2010 | 72,073 | Jan 2011 | ||||||||||||||||||||||||||||||
Total
|
645,223 | 52,589 | 98,312 | | 288,652 | 881,286 | ||||||||||||||||||||||||||||||||||
Mark Fairbairn | ||||||||||||||||||||||||||||||||||||||||
|
PSP | 77,132 | 26,881 (iii) | 50,251 (iii) | | | 648.24 | Jun 2007 | 50,251 | Apr 2011 | ||||||||||||||||||||||||||||||
|
PSP | 42,798 | 14,916 (iii) | 27,882 (iii) | | | 700.95 | Nov 2007 | 27,882 | Apr 2011 | ||||||||||||||||||||||||||||||
|
PSP | 158,065 (x) | | | | | 584.57 | Jun 2008 | 158,065 | Apr 2011 | ||||||||||||||||||||||||||||||
|
PSP | 195,394 (x) | | | | | 472.89 | Jun 2009 | 195,394 | Apr 2011 | ||||||||||||||||||||||||||||||
|
PSP | | | | | 190,694 (x) | 494.5076 | Jun 2010 | 190,694 | Apr 2011 | ||||||||||||||||||||||||||||||
|
DSP | 46,446 (x) | | | | | 610.37 | Jun 2008 | 46,446 | Apr 2011 | ||||||||||||||||||||||||||||||
|
DSP | 32,605 (iv), (x) | | | | | 541.14 | Jun 2009 | 32,605 | Apr 2011 | ||||||||||||||||||||||||||||||
|
DSP | | | | | 52,015 (x) | 506.294 | Jun 2010 | 52,015 | Apr 2011 | ||||||||||||||||||||||||||||||
Total
|
552,440 | 41,797 | 78,133 | | 242,709 | 753,352 | ||||||||||||||||||||||||||||||||||
(i) | The award numbers shown, for awards granted prior to the rights issue which completed on 14 June 2010, except those shares detailed in note (iv) below, were adjusted using an adjustment factor of 1.14271765. |
(ii) | The market prices of awards above, for awards granted prior to the rights issue which completed on 14 June 2010, except those shares detailed in note (iv) below, were adjusted using an adjustment factor of 0.87510681. |
(iii) | The 2007 PSP award vested partially in June 2010 at a vesting level of 65.15% of the award. The award then entered a retention period. Cash payments in lieu of dividends accrued during the retention period were paid as follows: Steve Holliday £44,478 in August 2010 and £23,098 in February 2011; Nick Winser £23,964 and £12,445; Tom King £20,139 and £11,626; Steve Lucas £27,134 in August 2010; and Mark Fairbairn £21,565 and £11,199 respectively. |
(iv) | Exceptionally, the 2009 DSP award for UK-based Executive Directors was made over restricted shares. The award was subject to income tax and National Insurance Contributions on grant and therefore shares shown reflect the net number of shares. As these shares are beneficially owned, UK-based Executive Directors were able to participate in the rights issue. They chose to take up their rights in full and these additional shares are included in Table 5 on page 108. |
(v) | Andrew Bonfield was appointed after the June 2010 PSP award was granted and he received a full award in November 2010. |
(vi) | Awards were made over ADSs and each ADS represents five ordinary shares. |
(vii) | Tom King received a SRA as part of a contractual commitment made at the time of his recruitment. The award vested in three equal tranches over three years, the final vesting for which was November 2010 for 13,517 ADSs. The ADS price on vesting for the final tranche was $44.8449. |
(viii) | Shortly after leaving, Steve Lucas received 246,712 PSP shares that vested as a result of time pro ration from the date of grant to his leave date, taking into account the performance criteria achieved for each award. In order to recognise his significant contribution to the business, the Remuneration Committee exercised its discretion and allowed a further 52,984 shares to vest. Instead of receiving the additional 52,984 shares, it was agreed an equivalent monetary value (using a share price of 553p) would be transferred into his pension fund. See Table 2 on page 104. All remaining PSP shares shown in the table above lapsed. |
(ix) | Shortly after leaving, Steve Lucas received the DSP shares awarded to him, as detailed in the table above. This treatment aligns with normal practice for such leavers under the plan rules. |
(x) | Shortly after leaving, Mark Fairbairn received the PSP shares for each award that vested as a result of time pro ration from the date of grant to his leave date, taking into account the performance criteria achieved for each award. This amounted to 231,407 shares. All remaining PSP shares shown in the table above lapsed. He also received his DSP shares, as detailed in the table above. This treatment aligns with normal practice for such leavers under the plan rules. |
Adjusted no. of | Adjusted no. of | |||||||||||||||
Ordinary shares at | Ordinary shares at | options/awards over | options/awards over | |||||||||||||
31 March 2011 | 1 April 2010 | ordinary shares at | ordinary shares at | |||||||||||||
or, if earlier, on | or, if later, on | 31 March 2011 or, if earlier, on | 1 April 2010 or, if later, on | |||||||||||||
Table 5 | retirement (i) | appointment * | retirement (ii) | appointment * (ii) | ||||||||||||
Sir John Parker
|
134,712 | 81,635 | | | ||||||||||||
Steve Holliday (iii), (iv), (v)
|
339,451 | 221,472 | 1,680,485 | 1,251,839 | ||||||||||||
Andrew Bonfield (iii), (iv), (v)
|
44 | * | 239,885 | * | ||||||||||||
Nick Winser (iv)
|
325,914 | 223,138 | 776,189 | 561,912 | ||||||||||||
Tom King
|
155,195 | 97,640 | 1,024,155 | 756,856 | ||||||||||||
Steve Lucas (iv), (vi), (vii)
|
214,720 | 167,503 | 946,869 | 712,743 | ||||||||||||
Mark Fairbairn (iv), (viii)
|
219,781 | 143,372 | 755,948 | 556,023 | ||||||||||||
Ken Harvey
|
5,236 | 3,740 | | | ||||||||||||
Linda Adamany
|
2,800 | 2,000 | | | ||||||||||||
Philip Aiken
|
4,900 | 3,500 | | | ||||||||||||
John Allan
|
14,500 | 7,000 | | | ||||||||||||
Stephen Pettit
|
3,906 | 2,632 | | | ||||||||||||
Maria Richter
|
14,357 | 10,255 | | | ||||||||||||
George Rose
|
6,792 | 4,852 | | | ||||||||||||
(i) | The number of shares shown represent beneficial holdings, including those shares subscribed for by Directors under the rights issue. |
(ii) | The option/award numbers shown, for awards granted prior to the rights issue which completed on 14 June 2010, except those shares detailed in Table 4 note (iv) on page 107, were adjusted using an adjustment factor of 1.14271765. |
(iii) | There has been no other change in the beneficial interests of the Directors in ordinary shares between 1 April 2011 and 18 May 2011, except in respect of routine monthly purchases under the SIP (see note (v) below). |
(iv) | Each of the Executive Directors, with the exception of Tom King, was for Companies Act purposes deemed to be a potential beneficiary under the National Grid plc 1996 Employee Benefit Trust and the National Grid Employee Share Trust; Steve Holliday, Andrew Bonfield, Nick Winser, Steve Lucas and Mark Fairbairn thereby have an interest in 178,690 and 693,481 ordinary shares in the aforementioned trusts respectively, as at 31 March 2011 (with the latter trust holding 9,977 ADSs in addition). |
(v) | Beneficial interests includes shares purchased under the monthly operation of the SIP in the year to 31 March 2011. In April and May 2011 a further 42 shares were purchased on behalf of Steve Holliday and a further 41 shares were purchased on behalf of Andrew Bonfield thereby increasing their beneficial interests. |
(vi) | Steve Lucas was for Companies Act purposes deemed to be a potential beneficiary in 6,188 ordinary shares held by Lattice Group Trustees Limited as trustee of the Lattice Group Employee Share Ownership Trust as at 31 March 2011. |
(vii) | Steve Lucas retired from the Board as a Director on 31 December 2010. |
(viii) | Mark Fairbairn left the Company on 31 March 2011. |
Notes to the consolidated financial statements supplementary information | ||||
152 | ||||
153 | ||||
153 | ||||
156 | ||||
157 | ||||
162 | ||||
165 | ||||
167 | ||||
169 | ||||
170 | ||||
|
||||
|
||||
Company financial statements under UK GAAP | ||||
|
||||
Basis of preparation | ||||
177 | ||||
|
||||
Primary statement | ||||
179 | ||||
|
||||
Notes to the Company financial statements | ||||
180 | ||||
180 | ||||
180 | ||||
181 | ||||
181 | ||||
181 | ||||
182 | ||||
182 | ||||
183 | ||||
183 |
| select suitable accounting policies and then apply them consistently; | |
| make judgements and estimates that are reasonable and prudent; | |
| state that the consolidated financial statements comply with IFRS as adopted by the European Union and, with regard to the Company financial statements, that applicable UK Accounting Standards have been followed, subject to any material departures disclosed and explained in the financial statements; and | |
| prepare the consolidated financial statements and Company financial statements on a going concern basis unless it is inappropriate to presume that the Company, on a consolidated and individual basis, will continue in business, in which case there should be supporting assumptions or qualifications as necessary. |
| the consolidated financial statements and the Company financial statements, which have been prepared in accordance with IFRS as adopted by the European Union and UK GAAP respectively, give a true and fair view of the assets, liabilities, financial position and profit of the Company on a consolidated and individual basis; and | |
| the Annual Report includes a fair review of the development and performance of the business and the position of the Company on a consolidated and individual basis, together with a description of the principal risks and uncertainties that it faces. |
| the financial statements give a true and fair view of the state of the groups and of the Companys affairs as at 31 March 2011 and of the groups profit and cash flows for the year then ended; | |
| the consolidated financial statements have been properly prepared in accordance with IFRS as adopted by the European Union; | |
| the Company financial statements have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and | |
| the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the consolidated financial statements, Article 4 of the lAS Regulation. |
| the part of the Directors Remuneration Report to be audited has been properly prepared in accordance with the Companies Act 2006; and | |
| the information given in the Directors Report for the financial year for which the financial statements are prepared is consistent with the financial statements. |
| adequate accounting records have not been kept by the Company, or returns adequate for our audit have not been received from branches not visited by us; or | |
| the Company financial statements and the part of the Directors Remuneration Report to be audited are not in agreement with the accounting records and returns; or | |
| certain disclosures of Directors remuneration specified by law are not made; or | |
| we have not received all the information and explanations we require for our audit. |
| the Directors statement, set out on page 70, in relation to going concern; | |
| the part of the Corporate Governance Statement relating to the Companys compliance with the nine provisions of the June 2008 Combined Code specified for our review; and | |
| certain elements of the report to shareholders by the Board on Directors remuneration. |
Amortisation periods | Years | |||
Software
|
3 to 7 | |||
Acquisition-related intangibles
|
10 to 25 | |||
Other licences and other intangibles
|
3 to 5 | |||
Depreciation periods | Years | |||
Freehold and leasehold buildings
|
up to 65 | |||
Plant and machinery
|
||||
Electricity transmission plant
|
15 to 60 | |||
Electricity distribution plant
|
15 to 60 | |||
Electricity generation plant
|
20 to 40 | |||
Interconnector plant
|
15 to 60 | |||
Gas plant mains, services and regulating equipment
|
30 to 100 | |||
Gas plant storage
|
40 | |||
Gas plant meters
|
10 to 33 | |||
Motor vehicles and office equipment
|
up to 10 | |||
| The categorisation of certain items as exceptional items, remeasurements and stranded cost recoveries and the definition of adjusted earnings notes 3 and 8. | |
| The exemptions adopted on transition to IFRS on 1 April 2004 including, in particular, those relating to business combinations. | |
| Classification of business activities as held for sale and discontinued operations accounting policy I. | |
| Hedge accounting accounting policy R. | |
| Energy purchase contracts classification as being for normal purchase, sale or usage accounting policy Q and note 28. |
| Impairment of goodwill accounting policy D and note 9. | |
| Review of residual lives, carrying values and impairment charges for other intangible assets and property, plant and equipment accounting policies E, F and G. | |
| Estimation of liabilities for pensions and other post-retirement benefits note 23. | |
| Valuation of financial instruments and derivatives notes 14 and 31. | |
| Revenue recognition and assessment of unbilled revenue accounting policy L. | |
| Recoverability of deferred tax assets accounting policy H and note 22. | |
| Environmental and decommissioning provisions note 24. |
| IFRS 3R on business combinations | |
| IAS 27R on consolidated and individual financial statements | |
| Amendment to IAS 39 Financial Instruments: Recognition and measurement on eligible hedged items | |
| Revised IFRS 1 on first time adoption of IFRS | |
| IFRIC 17 on distribution of non-cash assets to owners | |
| Improvements to IFRS 2009 | |
| Amendment to IFRS 2 on group cash-settled share-based payments | |
| Amendment to IFRS 1 on first time adoption of IFRS | |
| Amendment to IAS 32 on classification of rights issues |
| IFRS 9 on financial instruments | |
| Revised IAS 24 on related party disclosures | |
| IFRIC 19 on extinguishing financial liabilities with equity instruments | |
| Amendment to IFRIC 14 on prepayments of a minimum funding requirement | |
| Amendment to IFRS 1 on comparative IFRS 7 disclosures | |
| Improvements to IFRS 2010 | |
| Amendment to IFRS 7 on disclosures for transfers of financial assets | |
| Amendment to IFRS 1 on severe hyperinflation and removal of fixed dates for first-time adoption | |
| Amendment to IAS 12 on deferred tax on recovery of underlying assets | |
| IFRS 10 on consolidated financial statements | |
| IFRS 11 on joint arrangements | |
| IFRS 12 on disclosures of interests in other entities | |
| IFRS 13 on fair value measurements | |
| IAS 27 on separate financial statements | |
| IAS 28 on investment in associates and joint ventures |
2011 | 2011 | 2010 | 2010 | 2009 | 2009 | |||||||||||||||||||||||
Notes | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Revenue*
|
1(a) | 14,343 | 14,007 | 15,687 | ||||||||||||||||||||||||
Operating costs
|
2 | (10,598) | (10,714 | ) | (13,064 | ) | ||||||||||||||||||||||
Operating profit
|
||||||||||||||||||||||||||||
Before exceptional items, remeasurements
and stranded cost recoveries |
1(b) | 3,600 | 3,121 | 2,915 | ||||||||||||||||||||||||
Exceptional items, remeasurements and
Stranded cost recoveries |
3 | 145 | 172 | (292 | ) | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Total operating profit
|
1(b) | 3,745 | 3,293 | 2,623 | ||||||||||||||||||||||||
Interest income and similar income
|
||||||||||||||||||||||||||||
Before exceptional items
|
4 | 1,281 | 1,005 | 1,315 | ||||||||||||||||||||||||
Exceptional items
|
3,4 | 43 | | | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Total interest income and similar income
|
4 | 1,324 | 1,005 | 1,315 | ||||||||||||||||||||||||
Interest expense and other finance costs
|
||||||||||||||||||||||||||||
Before exceptional items and remeasurements
|
4 | (2,415) | (2,160) | (2,465 | ) | |||||||||||||||||||||||
Exceptional items and remeasurements
|
3,4 | (37) | 47 | (84 | ) | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Total interest expense and other finance costs
|
4 | (2,452) | (2,113 | ) | (2,549 | ) | ||||||||||||||||||||||
Share of post-tax results of joint ventures and associates
|
13 | 7 | 8 | 5 | ||||||||||||||||||||||||
Profit before tax
|
||||||||||||||||||||||||||||
Before
exceptional items, remeasurements
and stranded cost recoveries |
1(b) | 2,473 | 1,974 | 1,770 | ||||||||||||||||||||||||
Exceptional items, remeasurements
and Stranded cost recoveries |
3 | 151 | 219 | (376 | ) | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Total profit before tax
|
1(b) | 2,624 | 2,193 | 1,394 | ||||||||||||||||||||||||
Taxation
|
||||||||||||||||||||||||||||
Before exceptional items, remeasurements
and stranded cost recoveries |
5 | (722) | (553) | (517 | ) | |||||||||||||||||||||||
Exceptional items, remeasurements and
stranded cost recoveries |
3,5 | 261 | (251) | 45 | ||||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Total taxation
|
5 | (461) | (804 | ) | (472 | ) | ||||||||||||||||||||||
Profit from continuing operations after tax
|
||||||||||||||||||||||||||||
Before exceptional items, remeasurements
and stranded cost recoveries |
1,751 | 1,421 | 1,253 | |||||||||||||||||||||||||
Exceptional items, remeasurements and
stranded cost recoveries |
3 | 412 | (32) | (331 | ) | |||||||||||||||||||||||
|
||||||||||||||||||||||||||||
Profit for the year from continuing operations
|
2,163 | 1,389 | 922 | |||||||||||||||||||||||||
Profit for the year from discontinued operations
|
6 | | | 25 | ||||||||||||||||||||||||
Profit for the year
|
2,163 | 1,389 | 947 | |||||||||||||||||||||||||
Attributable to:
|
||||||||||||||||||||||||||||
Equity shareholders of the parent
|
2,159 | 1,386 | 944 | |||||||||||||||||||||||||
Non-controlling interests
|
4 | 3 | 3 | |||||||||||||||||||||||||
|
2,163 | 1,389 | 947 | |||||||||||||||||||||||||
Earnings per share from continuing operations**
|
||||||||||||||||||||||||||||
Basic
|
8 | 63.9p | 48.4p | 31.8p | ||||||||||||||||||||||||
Diluted
|
8 | 63.6p | 48.2p | 31.7p | ||||||||||||||||||||||||
Earnings per share**
|
||||||||||||||||||||||||||||
Basic
|
8 | 63.9p | 48.4p | 32.7p | ||||||||||||||||||||||||
Diluted
|
8 | 63.6p | 48.2p | 32.5p | ||||||||||||||||||||||||
2011 | 2010 | 2009 | ||||||||||||||
Notes | £m | £m | £m | |||||||||||||
Profit for the year
|
2,163 | 1,389 | 947 | |||||||||||||
|
||||||||||||||||
Other comprehensive income/(loss):
|
||||||||||||||||
Exchange adjustments
|
(95 | ) | 33 | 464 | ||||||||||||
Actuarial net gains/(losses)
|
23 | 571 | (731 | ) | (2,018 | ) | ||||||||||
Deferred tax on actuarial net gains and losses
|
5 | (181 | ) | 175 | 678 | |||||||||||
Net gains/(losses) in respect of cash flow hedges
|
7 | (45 | ) | (1 | ) | |||||||||||
Transferred to profit or loss on cash flow hedges
|
(7 | ) | 3 | (53 | ) | |||||||||||
Deferred tax on cash flow hedges
|
5 | (2 | ) | 9 | 19 | |||||||||||
Net gains on available-for-sale investments
|
16 | 54 | 9 | |||||||||||||
Transferred to profit or loss on sale of available-for-sale investments
|
(3 | ) | (6 | ) | (18 | ) | ||||||||||
Deferred tax on available-for-sale investments
|
5 | (1 | ) | (5 | ) | 7 | ||||||||||
Share of post-tax other comprehensive (loss)/income of joint ventures
|
(4 | ) | 5 | | ||||||||||||
Other comprehensive income/(loss) for the year, net of tax
|
301 | (508 | ) | (913 | ) | |||||||||||
|
||||||||||||||||
Total comprehensive income for the year
|
2,464 | 881 | 34 | |||||||||||||
Total comprehensive income attributable to:
|
||||||||||||||||
Equity shareholders of the parent
|
2,460 | 879 | 26 | |||||||||||||
Non-controlling interests
|
4 | 2 | 8 | |||||||||||||
|
2,464 | 881 | 34 | |||||||||||||
2011 |
2010 | |||||||||||
Notes | £m | £m | ||||||||||
Non-current assets
|
||||||||||||
Goodwill
|
9 | 4,776 | 5,102 | |||||||||
Other intangible assets
|
10 | 501 | 389 | |||||||||
Property, plant and equipment
|
11 | 31,956 | 30,855 | |||||||||
Other non-current assets
|
12 | 135 | 162 | |||||||||
Pension assets
|
23 | 556 | | |||||||||
Financial and other investments
|
13 | 593 | 486 | |||||||||
Derivative financial assets
|
14 | 1,270 | 1,494 | |||||||||
Total non-current assets
|
39,787 | 38,488 | ||||||||||
Current assets
|
||||||||||||
Inventories and current intangible assets
|
15 | 320 | 407 | |||||||||
Trade and other receivables
|
16 | 2,212 | 2,293 | |||||||||
Financial and other investments
|
13 | 2,939 | 1,397 | |||||||||
Derivative financial assets
|
14 | 468 | 248 | |||||||||
Cash and cash equivalents
|
17 | 384 | 720 | |||||||||
Total current assets
|
6,323 | 5,065 | ||||||||||
Assets of businesses held for sale
|
18 | 290 | | |||||||||
Total assets
|
46,400 | 43,553 | ||||||||||
Current liabilities
|
||||||||||||
Borrowings
|
19 | (2,952 | ) | (2,806 | ) | |||||||
Derivative financial liabilities
|
14 | (190 | ) | (212 | ) | |||||||
Trade and other payables
|
20 | (2,828 | ) | (2,847 | ) | |||||||
Current tax liabilities
|
(503 | ) | (391 | ) | ||||||||
Provisions
|
24 | (353 | ) | (303 | ) | |||||||
Total current liabilities
|
(6,826 | ) | (6,559 | ) | ||||||||
Non-current liabilities
|
||||||||||||
Borrowings
|
19 | (20,246 | ) | (22,318 | ) | |||||||
Derivative financial liabilities
|
14 | (404 | ) | (662 | ) | |||||||
Other non-current liabilities
|
21 | (1,944 | ) | (1,974 | ) | |||||||
Deferred tax liabilities
|
22 | (3,766 | ) | (3,324 | ) | |||||||
Pensions and other post-retirement benefit obligations
|
23 | (2,574 | ) | (3,098 | ) | |||||||
Provisions
|
24 | (1,461 | ) | (1,407 | ) | |||||||
Total non-current liabilities
|
(30,395 | ) | (32,783 | ) | ||||||||
Liabilities of businesses held for sale
|
18 | (110 | ) | | ||||||||
Total liabilities
|
(37,331 | ) | (39,342 | ) | ||||||||
Net assets
|
9,069 | 4,211 | ||||||||||
Equity
|
||||||||||||
Called up share capital
|
25 | 416 | 298 | |||||||||
Share premium account
|
1,361 | 1,366 | ||||||||||
Retained earnings
|
12,153 | 7,316 | ||||||||||
Other equity reserves
|
26 | (4,870 | ) | (4,781 | ) | |||||||
Shareholders equity
|
9,060 | 4,199 | ||||||||||
Non-controlling interests
|
9 | 12 | ||||||||||
Total equity
|
9,069 | 4,211 | ||||||||||
Called-up | Share | Other | Total | Non- | ||||||||||||||||||||||||
share | premium | Retained | equity | shareholders | controlling | Total | ||||||||||||||||||||||
capital | account | earnings | reserves (i) | equity | interests | equity | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
At 31 March 2008
|
294 | 1,371 | 8,943 | (5,252 | ) | 5,356 | 18 | 5,374 | ||||||||||||||||||||
Total comprehensive (loss)/income for the year
|
| | (396 | ) | 422 | 26 | 8 | 34 | ||||||||||||||||||||
Equity dividends
|
| | (838 | ) | | (838 | ) | | (838 | ) | ||||||||||||||||||
Issue of treasury shares
|
| | 8 | | 8 | | 8 | |||||||||||||||||||||
Repurchase of share capital and purchase of treasury shares
|
| | (603 | ) | | (603 | ) | | (603 | ) | ||||||||||||||||||
Other movements in non-controlling interests
|
| | | | | (12 | ) | (12 | ) | |||||||||||||||||||
Share-based payment
|
| | 22 | | 22 | | 22 | |||||||||||||||||||||
Tax on share-based payment
|
| | (1 | ) | | (1 | ) | | (1 | ) | ||||||||||||||||||
At 31 March 2009
|
294 | 1,371 | 7,135 | (4,830 | ) | 3,970 | 14 | 3,984 | ||||||||||||||||||||
Total comprehensive income for the year
|
| | 830 | 49 | 879 | 2 | 881 | |||||||||||||||||||||
Equity dividends
|
| | (893 | ) | | (893 | ) | | (893 | ) | ||||||||||||||||||
Scrip dividend related share issue
|
4 | (5 | ) | 205 | | 204 | | 204 | ||||||||||||||||||||
Issue of treasury shares
|
| | 18 | | 18 | | 18 | |||||||||||||||||||||
Purchase of own shares
|
| | (7 | ) | | (7 | ) | | (7 | ) | ||||||||||||||||||
Other movements in non-controlling interests
|
| | | | | (4 | ) | (4 | ) | |||||||||||||||||||
Share-based payment
|
| | 25 | | 25 | | 25 | |||||||||||||||||||||
Tax on share-based payment
|
| | 3 | | 3 | | 3 | |||||||||||||||||||||
At 31 March 2010
|
298 | 1,366 | 7,316 | (4,781 | ) | 4,199 | 12 | 4,211 | ||||||||||||||||||||
Total comprehensive income for the year
|
| | 2,549 | (89 | ) | 2,460 | 4 | 2,464 | ||||||||||||||||||||
Rights issue
|
113 | | | 3,101 | 3,214 | | 3,214 | |||||||||||||||||||||
Transfer between reserves
|
| | 3,101 | (3,101 | ) | | | | ||||||||||||||||||||
Equity dividends
|
| | (1,064 | ) | | (1,064 | ) | | (1,064 | ) | ||||||||||||||||||
Scrip dividend related share issue
|
5 | (5 | ) | 206 | | 206 | | 206 | ||||||||||||||||||||
Issue of treasury shares
|
| | 18 | | 18 | | 18 | |||||||||||||||||||||
Purchase of own shares
|
| | (3 | ) | | (3 | ) | | (3 | ) | ||||||||||||||||||
Other movements in non-controlling interests
|
| | | | | (7 | ) | (7 | ) | |||||||||||||||||||
Share-based payment
|
| | 25 | | 25 | | 25 | |||||||||||||||||||||
Tax on share-based payment
|
| | 5 | | 5 | | 5 | |||||||||||||||||||||
At 31 March 2011
|
416 | 1,361 | 12,153 | (4,870 | ) | 9,060 | 9 | 9,069 | ||||||||||||||||||||
(i) | For further details of other reserves, see note 26. |
2011 |
2010 | 2009 | ||||||||||||||
Notes | £m | £m | £m | |||||||||||||
Cash flows from operating activities
|
||||||||||||||||
Total operating profit
|
1 | (b) | 3,745 | 3,293 | 2,623 | |||||||||||
Adjustments for:
|
||||||||||||||||
Exceptional items, remeasurements and stranded cost recoveries
|
3 | (145 | ) | (172 | ) | 292 | ||||||||||
Depreciation and amortisation
|
1,245 | 1,188 | 1,122 | |||||||||||||
Share-based payment charge
|
25 | 25 | 22 | |||||||||||||
Changes in working capital
|
185 | 431 | 54 | |||||||||||||
Changes in provisions
|
(93 | ) | (98 | ) | (99 | ) | ||||||||||
Changes in pensions and other post-retirement benefit obligations
|
(304 | ) | (521 | ) | (678 | ) | ||||||||||
Cash flows relating to exceptional items
|
(147 | ) | (135 | ) | (131 | ) | ||||||||||
Cash flows relating to stranded cost recoveries
|
343 | 361 | 359 | |||||||||||||
Cash flows generated from continuing operations
|
4,854 | 4,372 | 3,564 | |||||||||||||
Cash flows relating to discontinued operations (excluding tax)
|
27 | (a) | | | (8 | ) | ||||||||||
Cash generated from operations
|
4,854 | 4,372 | 3,556 | |||||||||||||
Tax received/(paid)
|
4 | 144 | (143 | ) | ||||||||||||
Net cash inflow from operating activities
|
4,858 | 4,516 | 3,413 | |||||||||||||
Cash flows from investing activities
|
||||||||||||||||
Acquisition of investments
|
(135 | ) | (86 | ) | (73 | ) | ||||||||||
Net proceeds from sale of investments in subsidiaries
|
11 | 6 | | |||||||||||||
Purchases of intangible assets
|
(176 | ) | (104 | ) | (78 | ) | ||||||||||
Purchases of property, plant and equipment
|
(2,958 | ) | (3,007 | ) | (3,107 | ) | ||||||||||
Disposals of property, plant and equipment
|
26 | 15 | 27 | |||||||||||||
Dividends received from joint ventures
|
9 | 18 | | |||||||||||||
Interest received
|
26 | 21 | 85 | |||||||||||||
Net movement in short-term financial investments
|
(1,577 | ) | 805 | 99 | ||||||||||||
Cash flows used in continuing operations investing activities
|
(4,774 | ) | (2,332 | ) | (3,047 | ) | ||||||||||
Cash flows relating to discontinued operations investing activities (net of tax)
|
27 | (b) | | | 1,049 | |||||||||||
Net cash flow used in investing activities
|
(4,774 | ) | (2,332 | ) | (1,998 | ) | ||||||||||
Cash flows from financing activities
|
||||||||||||||||
Proceeds of rights issue
|
3,214 | | | |||||||||||||
Proceeds from issue of treasury shares
|
18 | 18 | 8 | |||||||||||||
Proceeds from loans received
|
767 | 1,933 | 4,892 | |||||||||||||
Repayment of loans
|
(2,878 | ) | (2,257 | ) | (2,618 | ) | ||||||||||
Net movements in short-term borrowings and derivatives
|
348 | (175 | ) | (633 | ) | |||||||||||
Interest paid
|
(965 | ) | (1,003 | ) | (1,061 | ) | ||||||||||
Exceptional finance costs on the redemption of debt
|
(73 | ) | (33 | ) | | |||||||||||
Dividends paid to shareholders
|
(858 | ) | (688 | ) | (838 | ) | ||||||||||
Repurchase of share capital and purchase of treasury shares
|
(3 | ) | (7 | ) | (627 | ) | ||||||||||
Net cash flow used in financing activities
|
(430 | ) | (2,212 | ) | (877 | ) | ||||||||||
Net (decrease)/increase in cash and cash equivalents
|
27 | (c) | (346 | ) | (28 | ) | 538 | |||||||||
Exchange movements
|
(3 | ) | (1 | ) | 18 | |||||||||||
Net cash and cash equivalents at start of year
|
691 | 720 | 164 | |||||||||||||
Net cash and cash equivalents at end of year (i)
|
17 | 342 | 691 | 720 | ||||||||||||
(i) | Net of bank overdrafts of £42m (2010: £29m; 2009: £17m). |
Transmission UK
|
High voltage electricity transmission networks, the gas transmission network in Great Britain, UK liquefied natural gas (LNG) storage activities and the French electricity interconnector. | |
|
||
Transmission US
|
High voltage electricity transmission networks in New York and New England. | |
|
||
Gas Distribution UK
|
Four of the eight regional networks of Great Britains gas distribution system. | |
|
||
Gas Distribution US
|
Gas distribution networks in New York and New England. | |
|
||
Electricity Distribution & Generation US
|
Electricity distribution networks in New York and New England and electricity generation facilities in New York. | |
Sales |
Sales | Sales | Sales | Sales | Sales | |||||||||||||||||||||||||||||||
Total | between | to third | Total | between | to third | Total | between | to third | ||||||||||||||||||||||||||||
sales | segments | parties | sales | segments | parties | sales | segments | parties | ||||||||||||||||||||||||||||
2011 | 2011 | 2011 | 2010 | 2010 | 2010 | 2009 | 2009 | 2009 | ||||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||||||||
Operating segments continuing operations
|
||||||||||||||||||||||||||||||||||||
Transmission UK*
|
3,484 | (7) | 3,477 | 3,475 | (6) | 3,469 | 3,517 | (2) | 3,515 | |||||||||||||||||||||||||||
Transmission US
|
429 | (56) | 373 | 405 | (74) | 331 | 420 | (83) | 337 | |||||||||||||||||||||||||||
Gas Distribution UK*
|
1,524 | (60) | 1,464 | 1,518 | (70) | 1,448 | 1,468 | (79) | 1,389 | |||||||||||||||||||||||||||
Gas Distribution US
|
3,811 | (4) | 3,807 | 3,708 | (5) | 3,703 | 4,786 | (3) | 4,783 | |||||||||||||||||||||||||||
Electricity Distribution & Generation US
|
4,567 | (1) | 4,566 | 4,339 | (1) | 4,338 | 4,972 | (1) | 4,971 | |||||||||||||||||||||||||||
Other activities*
|
678 | (22) | 656 | 741 | (23) | 718 | 750 | (58) | 692 | |||||||||||||||||||||||||||
|
14,493 | (150) | 14,343 | 14,186 | (179) | 14,007 | 15,913 | (226) | 15,687 | |||||||||||||||||||||||||||
Total excluding stranded cost recoveries
|
13,988 | 13,631 | 15,252 | |||||||||||||||||||||||||||||||||
Stranded cost recoveries
|
355 | 376 | 435 | |||||||||||||||||||||||||||||||||
|
14,343 | 14,007 | 15,687 | |||||||||||||||||||||||||||||||||
Geographical areas
|
||||||||||||||||||||||||||||||||||||
UK
|
5,556 | 5,543 | 5,397 | |||||||||||||||||||||||||||||||||
US
|
8,787 | 8,464 | 10,290 | |||||||||||||||||||||||||||||||||
|
14,343 | 14,007 | 15,687 | |||||||||||||||||||||||||||||||||
* | Items previously reported separately as other operating income have been included within revenue |
Before exceptional items, | After exceptional items, | |||||||||||||||||||||||
remeasurements and stranded | remeasurements and stranded | |||||||||||||||||||||||
cost recoveries | cost recoveries | |||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Operating segments continuing operations
|
||||||||||||||||||||||||
Transmission UK
|
1,363 | 1,311 | 1,126 | 1,293 | 1,252 | 1,063 | ||||||||||||||||||
Transmission US
|
156 | 153 | 175 | 154 | 151 | 173 | ||||||||||||||||||
Gas Distribution UK
|
711 | 723 | 672 | 671 | 682 | 629 | ||||||||||||||||||
Gas Distribution US
|
654 | 414 | 612 | 640 | 448 | 226 | ||||||||||||||||||
Electricity Distribution & Generation US
|
597 | 374 | 265 | 910 | 701 | 531 | ||||||||||||||||||
Other activities
|
119 | 146 | 65 | 77 | 59 | 1 | ||||||||||||||||||
|
3,600 | 3,121 | 2,915 | 3,745 | 3,293 | 2,623 | ||||||||||||||||||
Geographical areas
|
||||||||||||||||||||||||
UK
|
2,226 | 2,180 | 1,875 | 2,055 | 2,007 | 1,729 | ||||||||||||||||||
US
|
1,374 | 941 | 1,040 | 1,690 | 1,286 | 894 | ||||||||||||||||||
|
3,600 | 3,121 | 2,915 | 3,745 | 3,293 | 2,623 | ||||||||||||||||||
Reconciliation to profit before tax:
|
||||||||||||||||||||||||
Operating profit
|
3,600 | 3,121 | 2,915 | 3,745 | 3,293 | 2,623 | ||||||||||||||||||
Interest income and similar income
|
1,281 | 1,005 | 1,315 | 1,324 | 1,005 | 1,315 | ||||||||||||||||||
Interest expense and other finance costs
|
(2,415 | ) | (2,160 | ) | (2,465 | ) | (2,452 | ) | (2,113 | ) | (2,549 | ) | ||||||||||||
Share of post-tax results of joint ventures and associates
|
7 | 8 | 5 | 7 | 8 | 5 | ||||||||||||||||||
Profit before tax continuing operations
|
2,473 | 1,974 | 1,770 | 2,624 | 2,193 | 1,394 | ||||||||||||||||||
Capital expenditure | Depreciation and amortisation | |||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Operating segments continuing operations
|
||||||||||||||||||||||||
Transmission UK
|
1,432 | 1,254 | 1,259 | (400 | ) | (373 | ) | (353 | ) | |||||||||||||||
Transmission US
|
310 | 240 | 182 | (63 | ) | (59 | ) | (56 | ) | |||||||||||||||
Gas Distribution UK
|
669 | 670 | 598 | (218 | ) | (201 | ) | (177 | ) | |||||||||||||||
Gas Distribution US
|
415 | 409 | 421 | (175 | ) | (173 | ) | (172 | ) | |||||||||||||||
Electricity Distribution & Generation US
|
367 | 372 | 355 | (207 | ) | (215 | ) | (223 | ) | |||||||||||||||
Other activities
|
275 | 307 | 427 | (189 | ) | (173 | ) | (146 | ) | |||||||||||||||
|
3,468 | 3,252 | 3,242 | (1,252 | ) | (1,194 | ) | (1,127 | ) | |||||||||||||||
Geographical areas
|
||||||||||||||||||||||||
UK
|
2,310 | 2,187 | 2,270 | (789 | ) | (733 | ) | (679 | ) | |||||||||||||||
US
|
1,158 | 1,065 | 972 | (463 | ) | (461 | ) | (448 | ) | |||||||||||||||
|
3,468 | 3,252 | 3,242 | (1,252 | ) | (1,194 | ) | (1,127 | ) | |||||||||||||||
By asset type
|
||||||||||||||||||||||||
Property, plant and equipment
|
3,292 | 3,148 | 3,164 | (1,182 | ) | (1,131 | ) | (1,058 | ) | |||||||||||||||
Other non-current intangible assets
|
176 | 104 | 78 | (70 | ) | (63 | ) | (69 | ) | |||||||||||||||
|
3,468 | 3,252 | 3,242 | (1,252 | ) | (1,194 | ) | (1,127 | ) | |||||||||||||||
Before exceptional items, | Exceptional items, | |||||||||||||||||||||||||||||||||||
remeasurements and stranded | remeasurements and stranded | |||||||||||||||||||||||||||||||||||
cost recoveries | cost recoveries | Total | ||||||||||||||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | 2011 | 2010 | 2009 | ||||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||||||||
Depreciation and amortisation
|
1,245 | 1,188 | 1,122 | 7 | 6 | 5 | 1,252 | 1,194 | 1,127 | |||||||||||||||||||||||||||
Payroll costs
|
1,460 | 1,354 | 1,415 | 36 | 48 | 34 | 1,496 | 1,402 | 1,449 | |||||||||||||||||||||||||||
Purchases of electricity
|
1,547 | 1,592 | 2,199 | (65 | ) | (19 | ) | 28 | 1,482 | 1,573 | 2,227 | |||||||||||||||||||||||||
Purchases of gas
|
2,102 | 2,294 | 3,228 | (82 | ) | (52 | ) | 334 | 2,020 | 2,242 | 3,562 | |||||||||||||||||||||||||
Rates and property taxes
|
945 | 907 | 881 | | | | 945 | 907 | 881 | |||||||||||||||||||||||||||
Balancing Service Incentive Scheme
|
581 | 691 | 904 | | | | 581 | 691 | 904 | |||||||||||||||||||||||||||
Payments to Scottish transmission
owners |
298 | 260 | 243 | | | | 298 | 260 | 243 | |||||||||||||||||||||||||||
Other
|
2,210 | 2,224 | 2,345 | 314 | 221 | 326 | 2,524 | 2,445 | 2,671 | |||||||||||||||||||||||||||
|
10,388 | 10,510 | 12,337 | 210 | 204 | 727 | 10,598 | 10,714 | 13,064 | |||||||||||||||||||||||||||
Operating costs include:
|
||||||||||||||||||||||||||||||||||||
Inventory consumed
|
451 | 475 | 788 | |||||||||||||||||||||||||||||||||
Operating leases
|
89 | 87 | 81 | |||||||||||||||||||||||||||||||||
Research expenditure
|
16 | 19 | 10 | |||||||||||||||||||||||||||||||||
2011 |
2010 | 2009 | ||||||||||||||||||||||||||||||||||
£m | £m | £m | ||||||||||||||||||||||||||||||||||
Wages and salaries
|
1,592 | 1,596 | 1,615 | |||||||||||||||||||||||||||||||||
Social security costs
|
119 | 120 | 118 | |||||||||||||||||||||||||||||||||
Other pension costs
|
208 | 161 | 160 | |||||||||||||||||||||||||||||||||
Share-based payments (note 35)
|
25 | 25 | 22 | |||||||||||||||||||||||||||||||||
Severance costs (excluding pension costs)
|
56 | 16 | 16 | |||||||||||||||||||||||||||||||||
|
2,000 | 1,918 | 1,931 | |||||||||||||||||||||||||||||||||
Less: payroll costs capitalised
|
(504 | ) | (516 | ) | (482 | ) | ||||||||||||||||||||||||||||||
|
1,496 | 1,402 | 1,449 | |||||||||||||||||||||||||||||||||
31 March |
Average | 31 March | Average | |||||||||||||||||||||||||||||||||
2011 | 2011 | 2010 | 2010 | |||||||||||||||||||||||||||||||||
Number | Number | Number | Number | |||||||||||||||||||||||||||||||||
UK
|
9,807 | 9,953 | 10,211 | 10,269 | ||||||||||||||||||||||||||||||||
US
|
17,282 | 17,719 | 17,895 | 17,798 | ||||||||||||||||||||||||||||||||
|
27,089 | 27,672 | 28,106 | 28,067 | ||||||||||||||||||||||||||||||||
2011 |
2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Salaries and short-term employee benefits
|
10 | 10 | 11 | |||||||||
Post-retirement benefits
|
6 | 4 | 3 | |||||||||
Share-based payments
|
6 | 5 | 5 | |||||||||
|
22 | 19 | 19 | |||||||||
2011 |
2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Total services pursuant to legislation
|
||||||||||||
Audit services:
|
||||||||||||
Audit of parent company and consolidated financial statements
|
1.0 | 1.1 | 1.5 | |||||||||
Other services pursuant to legislation:
(i)
|
||||||||||||
Audit of subsidiary financial statements
|
4.8 | 5.4 | 5.8 | |||||||||
Other services supplied
|
2.1 | 1.9 | 2.4 | |||||||||
|
7.9 | 8.4 | 9.7 | |||||||||
Total other services
|
||||||||||||
Services relating to tax compliance
|
0.5 | 0.6 | 0.6 | |||||||||
Services relating to tax advice
|
0.4 | 0.8 | 0.3 | |||||||||
Services relating to information technology
|
0.2 | | | |||||||||
Services relating to corporate finance transactions*
|
0.4 | 0.4 | 0.1 | |||||||||
All other services* (ii)
|
1.2 | 0.8 | 0.8 | |||||||||
|
2.7 | 2.6 | 1.8 | |||||||||
Total auditors remuneration
|
10.6 | 11.0 | 11.5 | |||||||||
* Comparatives have been re-presented on a basis consistent with the current year classification | |
(i) | Other services supplied pursuant to legislation represent fees payable for services in relation to other statutory filings or engagements that are required to be carried out by the auditors. In particular, this includes fees for reports under section 404 of the US Public Company Accounting Reform and Investor Protection Act of 2002 (Sarbanes-Oxley) and audit reports on regulatory returns. |
(ii) | All other services include fees relating to corporate responsibility reporting, treasury related projects and sundry services, all of which have been subject to prior approval by the Audit Committee. |
2011 |
2010 |
2009 |
||||||||||
£m | £m | £m | ||||||||||
Included within operating profit:
|
||||||||||||
Exceptional items:
|
||||||||||||
Restructuring costs
(1)
|
(89 | ) | (149 | ) | (192 | ) | ||||||
Environmental charges
(2)
|
(128 | ) | (63 | ) | (78 | ) | ||||||
Net gain on disposal of subsidiaries and associate
(3)
|
15 | 11 | | |||||||||
Impairment charges and related costs
(4)
|
(133 | ) | | | ||||||||
Other
(5)
|
(15 | ) | (67 | ) | (5 | ) | ||||||
|
(350 | ) | (268 | ) | (275 | ) | ||||||
Remeasurements commodity contracts
(6)
|
147 | 71 | (443 | ) | ||||||||
Stranded cost recoveries
(7)
|
348 | 369 | 426 | |||||||||
|
145 | 172 | (292 | ) | ||||||||
Included within interest income and similar income:
|
||||||||||||
Exceptional items:
|
||||||||||||
Interest credit on tax settlement
(8)
|
43 | | | |||||||||
Included within finance costs:
|
||||||||||||
Exceptional items:
|
||||||||||||
Debt redemption costs
(9)
|
(73 | ) | (33 | ) | | |||||||
Remeasurements:
|
||||||||||||
Commodity contracts
(6)
|
| (1 | ) | (2 | ) | |||||||
Net gains/(losses) on derivative financial instruments
(10)
|
36 | 81 | (82 | ) | ||||||||
|
(37 | ) | 47 | (84 | ) | |||||||
Total included within profit before tax
|
151 | 219 | (376 | ) | ||||||||
Included within taxation:
|
||||||||||||
Exceptional credits/(charges) arising on items not included in profit before tax:
|
||||||||||||
Deferred tax credit arising on the reduction in the UK tax rate
(11)
|
226 | | | |||||||||
Deferred tax charge arising from change in UK industrial building allowance regime
(12)
|
| | (49 | ) | ||||||||
Other
(13,14)
|
59 | (41 | ) | | ||||||||
Tax on exceptional items
|
79 | 72 | 77 | |||||||||
Tax on remeasurements
(6,10)
|
36 | (134 | ) | 187 | ||||||||
Tax on stranded cost recoveries
|
(139 | ) | (148 | ) | (170 | ) | ||||||
|
261 | (251 | ) | 45 | ||||||||
|
||||||||||||
Total exceptional items, remeasurements and stranded cost recoveries after tax
|
412 | (32 | ) | (331 | ) | |||||||
|
||||||||||||
Analysis of total exceptional items, remeasurements and stranded cost recoveries after tax:
|
||||||||||||
Exceptional items after tax
|
(16 | ) | (270 | ) | (247 | ) | ||||||
Remeasurements after tax
|
219 | 17 | (340 | ) | ||||||||
Stranded cost recoveries after tax
|
209 | 221 | 256 | |||||||||
Total
|
412 | (32 | ) | (331 | ) | |||||||
(1) | Restructuring costs include: | ||
| costs related to the integration of KeySpan of £15m (2010: £30m; 2009: £53m); | ||
| transformation related initiatives of £103m (2010: £78m; 2009: £68m); | ||
| a charge of £10m related to the restructuring of our US operations, which includes a severance provision offset by a pension and other post-retirement benefits curtailment gain; and | ||
| a release of £39m of restructuring provisions recognised in prior years. | ||
Charges in 2010 and 2009 also included an amount for the restructuring of our liquefied natural gas (LNG) storage facilities of £41m and £50m respectively and in 2009 charges related to planned cost reduction programmes in our UK businesses of £21m. | |||
(2) | Environmental charges include £70m (2010: £42m; 2009: £37m) and £58m (2010: £21m; 2009: £41m) related to specific exposures in the UK and US respectively. Costs incurred with respect to US environmental provisions are substantially recoverable from customers. | ||
(3) | During the year we sold three wholly-owned subsidiaries and an interest in an associate resulting in a gain of £15m. During the year ended 31 March 2010 there was a gain of £5m on the sale of an associate and the release of various unutilised provisions amounting to £6m originally recorded on the sale of a wholly-owned subsidiary in 2008. |
(4) | Impairment charges and related costs include: | ||
| a charge of £49m relating to our investment in Blue-NG, a joint venture investing in combined heat and power generation. The charge comprises an impairment of the carrying value of the investment together with committed funding and associated exit costs; | ||
| an impairment charge of £34m against the carrying value of the goodwill relating to our US companies in New Hampshire following our announcement in December 2010 of the proposed sale of these businesses; and | ||
| a charge of £50m relating to our US generation assets for impairment and associated decommissioning. | ||
(5) | Other exceptional charges for the year include an amortisation charge of £7m (2010: £6m; 2009: £5m) in relation to acquisition-related intangibles plus an £8m penalty levied by Ofgem on our UK Gas Distribution business. For the year ended 31 March 2010, other exceptional items also included an impairment charge of £11m in relation to acquisition-related intangibles, a charge of £9m relating to US healthcare costs arising from legislative changes, and £41m related to a fine of £15m levied by the Gas and Electricity Markets Authority (GEMA) together with associated costs and provisions against receivables and other balance sheet items. For further details of the fine levied upon us by GEMA refer to note 28. | ||
(6) | Remeasurements commodity contracts represent mark-to-market movements on certain physical and financial commodity contract obligations in the US. These contracts primarily relate to the forward purchase of energy for supply to customers, or to the economic hedging thereof, that are required to be measured at fair value and that do not qualify for hedge accounting. Under the existing rate plans in the US, commodity costs are recoverable from customers although the timing of recovery may differ from the pattern of costs incurred. These movements are comprised of those affecting operating profit which are based on the change in the commodity contract liability and those recorded in finance costs as a result of the time value of money. | ||
(7) | Stranded cost recoveries include the recovery of some of our historical investments in generating plants that were divested as part of the restructuring and wholesale power deregulation process in New England and New York during the 1990s. Stranded cost recoveries on a pre-tax basis consist of revenue of £355m (2010: £376m; 2009: £435m) and operating costs of £7m (2010: £7m; 2009: £9m). | ||
(8) | During the year we reached agreement with the US tax authorities on the settlement of pre-acquisition tax liabilities which resulted in the repayment of tax and interest accruing. | ||
(9) | Debt redemption costs represent costs arising from our debt repurchase programme, undertaken primarily in the first half of the year, to manage our cash resources efficiently following the rights issue. Debt redemption costs in the year ended 31 March 2010 represented costs relating to the early redemption of a significant loan. | ||
(10) | Remeasurements net gains/(losses) on derivative financial instruments comprise gains/(losses) arising on derivative financial instruments reported in the income statement. These exclude gains and losses for which hedge accounting has been effective, which have been recognised directly in other comprehensive income or which are offset by adjustments to the carrying value of debt. The tax credit in the year includes a credit of £104m (2010: £78m charge; 2009: £1m charge) in respect of prior years. | ||
(11) | The exceptional tax credit arises from a reduction in the UK corporation tax rate from 28% to 26% included and enacted in the Finance (No. 2) Act 2010 and the Provisional Collection of Taxes Act 1968 and applicable from 1 April 2011. This results in a reduction in deferred tax liabilities. | ||
(12) | The exceptional tax charge of £49m in the year ended 31 March 2009 arose from a change in the UK industrial building allowance regime arising in the 2008 Finance Act. This resulted in an increase in deferred tax liabilities. | ||
(13) | The exceptional tax charge of £41m in the year ended 31 March 2010 arose from a change in US tax legislation under the Patient Protection and Affordable Care Act. | ||
(14) | The exceptional tax credit for the year ended 31 March 2011 primarily arose from a settlement of pre-acquisition tax liabilities with the US tax authorities. |
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Interest income and similar income
|
||||||||||||
Expected return on pension and other post-retirement benefit plan assets
|
1,256 | 981 | 1,236 | |||||||||
Interest income on financial instruments:
|
||||||||||||
Bank deposits and other financial assets
|
22 | 18 | 61 | |||||||||
Gains on disposal of available-for-sale investments
|
3 | 6 | 18 | |||||||||
Interest income and similar income before exceptional items
|
1,281 | 1,005 | 1,315 | |||||||||
Exceptional items
|
||||||||||||
Exceptional interest credit on tax settlement
|
43 | | | |||||||||
Interest income and similar income
|
1,324 | 1,005 | 1,315 | |||||||||
Interest expense and other finance costs
|
||||||||||||
Interest on pension and other post-retirement benefit plan obligations
|
(1,231 | ) | (1,193 | ) | (1,250 | ) | ||||||
Interest expense on financial liabilities held at amortised cost:
|
||||||||||||
Bank loans and overdrafts
|
(85 | ) | (80 | ) | (136 | ) | ||||||
Other borrowings
|
(1,184 | ) | (938 | ) | (1,149 | ) | ||||||
Derivatives
|
84 | 22 | 5 | |||||||||
Unwinding of discounts on provisions
|
(128 | ) | (70 | ) | (68 | ) | ||||||
Less: Interest capitalised (i)
|
129 | 99 | 133 | |||||||||
Interest expense and other finance costs before exceptional items and remeasurements
|
(2,415 | ) | (2,160 | ) | (2,465 | ) | ||||||
Exceptional items
|
||||||||||||
Exceptional debt redemption costs
|
(73 | ) | (33 | ) | | |||||||
Remeasurements
|
||||||||||||
Net gains/(losses) on derivative financial instruments included in remeasurements (ii):
|
||||||||||||
Ineffectiveness on derivatives designated as:
|
||||||||||||
Fair value hedges (iii)
|
40 | 67 | (34 | ) | ||||||||
Cash flow hedges
|
9 | (5 | ) | (18 | ) | |||||||
Net investment hedges
|
7 | (19 | ) | (2 | ) | |||||||
Net investment hedges undesignated forward rate risk
|
(16 | ) | 51 | 112 | ||||||||
Derivatives not designated as hedges or ineligible for hedge accounting
|
(4 | ) | (13 | ) | (140 | ) | ||||||
Financial element of remeasurements on commodity contracts
|
| (1 | ) | (2 | ) | |||||||
|
36 | 80 | (84 | ) | ||||||||
Exceptional items and remeasurements included within interest expense
|
(37 | ) | 47 | (84 | ) | |||||||
|
||||||||||||
Interest expense and other finance costs
|
(2,452 | ) | (2,113 | ) | (2,549 | ) | ||||||
|
||||||||||||
Net finance costs
|
(1,128 | ) | (1,108 | ) | (1,234 | ) | ||||||
(i) | Interest on funding attributable to assets in the course of construction was capitalised during the year at a rate of 5.3% (2010: 2.8%; 2009: 5.7%). |
(ii) | Includes a net foreign exchange gain on financing activities of £173m (2010: £334m gain; 2009: £1,500m loss) offset by foreign exchange gains and losses on derivative financial instruments measured at fair value. |
(iii) | Includes a net gain on instruments designated as fair value hedges of £86m (2010: £90m loss; 2009: £382m gain) offset by a net loss of £46m (2010: £157m gain; 2009: £416m loss) arising from fair value adjustments to the carrying value of debt. |
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Tax before exceptional items, remeasurements and stranded cost recoveries
|
722 | 553 | 517 | |||||||||
Exceptional tax on items not included in profit before tax (see note 3)
|
(285 | ) | 41 | 49 | ||||||||
Tax on other exceptional items, remeasurements and stranded cost recoveries
|
24 | 210 | (94 | ) | ||||||||
Tax on total exceptional items, remeasurements and stranded cost recoveries (see note 3)
|
(261 | ) | 251 | (45 | ) | |||||||
Total tax charge
|
461 | 804 | 472 | |||||||||
2011 | 2010 | 2009 | ||||||||||
% | % | % | ||||||||||
Before exceptional items, remeasurements and stranded cost recoveries
|
29.2 | 28.0 | 29.2 | |||||||||
After exceptional items, remeasurements and stranded cost recoveries
|
17.6 | 36.7 | 33.9 | |||||||||
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
United Kingdom
|
||||||||||||
Corporation tax at 28%
|
168 | 197 | 37 | |||||||||
Corporation tax adjustment in respect of prior years
|
(161 | ) | (31 | ) | (54 | ) | ||||||
Deferred tax
|
53 | 259 | 339 | |||||||||
Deferred tax adjustment in respect of prior years
|
(43 | ) | (5 | ) | | |||||||
|
17 | 420 | 322 | |||||||||
Overseas
|
||||||||||||
Corporate tax
|
105 | 74 | 105 | |||||||||
Corporate tax adjustment in respect of prior years
|
(2 | ) | (364 | ) | 38 | |||||||
Deferred tax
|
393 | 279 | 37 | |||||||||
Deferred tax adjustment in respect of prior years
|
(52 | ) | 395 | (30 | ) | |||||||
|
444 | 384 | 150 | |||||||||
Total tax charge
|
461 | 804 | 472 | |||||||||
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Corporation tax
|
||||||||||||
Share-based payments
|
(1 | ) | (3 | ) | (2 | ) | ||||||
Deferred tax
|
||||||||||||
Share of other comprehensive income of joint ventures and associates
|
(2 | ) | 4 | | ||||||||
Available-for-sale investments
|
1 | 5 | (7 | ) | ||||||||
Cash flow hedges
|
2 | (9 | ) | (19 | ) | |||||||
Share-based payments
|
(4 | ) | | 3 | ||||||||
Actuarial gains/(losses) (i)
|
181 | (175 | ) | (678 | ) | |||||||
|
177 | (178 | ) | (703 | ) | |||||||
Total tax recognised in the statement of comprehensive income
|
182 | (175 | ) | (704 | ) | |||||||
Total tax relating to share-based payments recognised directly in equity
|
(5 | ) | (3 | ) | 1 | |||||||
|
177 | (178 | ) | (703 | ) | |||||||
(i) | 2010 includes a £42m charge relating to a change in US tax legislation under the Patient Protection and Affordable Care Act. |
(i) | The tax charge for the year ended 31 March 2009 included a current tax charge of £564m offset by a deferred tax credit of £564m. |
2011 | 2010 | |||||||||||||||||||||||||||||||
2011 | 2011 | settled | 2010 | 2010 | settled | 2009 | 2009 | |||||||||||||||||||||||||
pence | Total | via scrip | pence | Total | via scrip | pence | Total | |||||||||||||||||||||||||
per share | £m | £m | per share | £m | £m | per share | £m | |||||||||||||||||||||||||
Interim year ended 31 March 2011
|
12.90 | 451 | 65 | | | | | | ||||||||||||||||||||||||
Final year ended 31 March 2010
|
24.84 | 613 | 141 | | | | | | ||||||||||||||||||||||||
Interim year ended 31 March 2010
|
| | | 13.65 | 336 | 68 | | | ||||||||||||||||||||||||
Final year ended 31 March 2009
|
| | | 23.00 | 557 | 137 | | | ||||||||||||||||||||||||
Interim year ended 31 March 2009
|
| | | | | | 12.64 | 307 | ||||||||||||||||||||||||
Final year ended 31 March 2008
|
| | | | | | 21.30 | 531 | ||||||||||||||||||||||||
|
37.74 | 1,064 | 206 | 36.65 | 893 | 205 | 33.94 | 838 | ||||||||||||||||||||||||
2011 | 2011 | 2011 | 2010 | 2010 | 2010 | 2009 | 2009 | |||||||||||||||||||||||||
pence | impact | pence | pence | impact | pence | pence | pence | |||||||||||||||||||||||||
per share | of rights | per share | per share | of rights | per share | per share | per share | |||||||||||||||||||||||||
(actual | ) | issue | (rebased | ) | (actual | ) | issue | (rebased | ) | (actual | ) | (rebased | ) | |||||||||||||||||||
Interim year ended 31 March 2011
|
12.90 | | 12.90 | | | | | | ||||||||||||||||||||||||
Final year ended 31 March 2010
|
24.84 | (3.10 | ) | 21.74 | | | | | | |||||||||||||||||||||||
Interim year ended 31 March 2010
|
| | | 13.65 | (1.71 | ) | 11.94 | | | |||||||||||||||||||||||
Final year ended 31 March 2009
|
| | | 23.00 | (1.87 | ) | 20.13 | | | |||||||||||||||||||||||
Interim year ended 31 March 2009
|
| | | | | | 12.64 | 11.06 | ||||||||||||||||||||||||
Final year ended 31 March 2008
|
| | | | | | 21.30 | 18.64 | ||||||||||||||||||||||||
|
37.74 | (3.10 | ) | 34.64 | 36.65 | (3.58 | ) | 32.07 | 33.94 | 29.70 | ||||||||||||||||||||||
Earnings | Earnings | Earnings | ||||||||||||||||||||||
Earnings | per share | Earnings | per share | Earnings | per share | |||||||||||||||||||
2011 | 2011 | 2010 | 2010 | * | 2009 | 2009 | * | |||||||||||||||||
£m | pence | £m | pence | £m | pence | |||||||||||||||||||
Adjusted earnings continuing operations
|
1,747 | 51.7 | 1,418 | 49.5 | 1,250 | 43.3 | ||||||||||||||||||
Exceptional items after tax
|
(16 | ) | (0.5 | ) | (270 | ) | (9.4 | ) | (247 | ) | (8.6 | ) | ||||||||||||
Remeasurements after tax
|
219 | 6.5 | 17 | 0.6 | (340 | ) | (11.8 | ) | ||||||||||||||||
Stranded cost recoveries after tax
|
209 | 6.2 | 221 | 7.7 | 256 | 8.9 | ||||||||||||||||||
Earnings continuing operations
|
2,159 | 63.9 | 1,386 | 48.4 | 919 | 31.8 | ||||||||||||||||||
Earnings discontinued operations
|
| | | | 25 | 0.9 | ||||||||||||||||||
Earnings
|
2,159 | 63.9 | 1,386 | 48.4 | 944 | 32.7 | ||||||||||||||||||
2011 | 2010 | 2009 | ||||||||||||||||||||||
millions | millions | millions | ||||||||||||||||||||||
Weighted average number of shares basic*
|
3,378 | 2,864 | 2,886 | |||||||||||||||||||||
*Comparative EPS data have been restated to reflect the impact of the bonus element of the rights issue and as a result of the additional shares issued as scrip dividends |
Earnings |
Earnings | Earnings | ||||||||||||||||||||||
Earnings | per share | Earnings | per share | Earnings | per share | |||||||||||||||||||
2011 | 2011 | 2010 | 2010 | * | 2009 | 2009 | * | |||||||||||||||||
£m | pence | £m | pence | £m | pence | |||||||||||||||||||
Adjusted diluted earnings continuing operations
|
1,747 | 51.4 | 1,418 | 49.3 | 1,250 | 43.1 | ||||||||||||||||||
Exceptional items after tax
|
(16 | ) | (0.5 | ) | (270 | ) | (9.4 | ) | (247 | ) | (8.5 | ) | ||||||||||||
Remeasurements after tax
|
219 | 6.5 | 17 | 0.6 | (340 | ) | (11.7 | ) | ||||||||||||||||
Stranded cost recoveries after tax
|
209 | 6.2 | 221 | 7.7 | 256 | 8.8 | ||||||||||||||||||
Diluted earnings continuing operations
|
2,159 | 63.6 | 1,386 | 48.2 | 919 | 31.7 | ||||||||||||||||||
Diluted earnings discontinued operations
|
| | | | 25 | 0.8 | ||||||||||||||||||
Diluted earnings
|
2,159 | 63.6 | 1,386 | 48.2 | 944 | 32.5 | ||||||||||||||||||
2011 |
2010 | 2009 | ||||||||||||||||||||||
millions | millions | millions | ||||||||||||||||||||||
Weighted average number of shares diluted*
|
3,397 | 2,877 | 2,903 | |||||||||||||||||||||
*Comparative EPS data have been restated to reflect the impact of the bonus element of the rights issue and as a result of the additional shares issued as scrip dividends |
2011 |
2010 | 2009 | ||||||||||||||||||||||
millions | millions | millions | ||||||||||||||||||||||
Weighted average number of ordinary shares basic
|
3,378 | 2,864 | 2,886 | |||||||||||||||||||||
Effect of dilutive potential ordinary shares employee share plans
|
19 | 13 | 17 | |||||||||||||||||||||
Weighted average number of ordinary shares diluted
|
3,397 | 2,877 | 2,903 | |||||||||||||||||||||
Total | ||||
£m | ||||
Cost at 31 March 2009
|
5,391 | |||
Exchange adjustments
|
(289 | ) | ||
Cost at 31 March 2010
|
5,102 | |||
Exchange adjustments
|
(280 | ) | ||
Impairment of goodwill on businesses reclassified as held for sale (notes 3 and 18) (i)
|
(34 | ) | ||
Reclassified as held for sale
|
(12 | ) | ||
Cost at 31 March 2011
|
4,776 | |||
Net book value at 31 March 2011
|
4,776 | |||
Net book value at 31 March 2010
|
5,102 | |||
(i) | Relates to our gas operations (£30m) and our electricity distribution operations (£4m). |
Acquisition- | ||||||||||||||||
Software | related | Other | Total | |||||||||||||
£m | £m | £m | £m | |||||||||||||
Non-current
|
||||||||||||||||
Cost at 31 March 2009
|
525 | 129 | 16 | 670 | ||||||||||||
Exchange adjustments
|
(8 | ) | (7 | ) | | (15 | ) | |||||||||
Additions
|
103 | | 1 | 104 | ||||||||||||
Reclassifications and disposals (i)
|
4 | | 1 | 5 | ||||||||||||
Cost at 31 March 2010
|
624 | 122 | 18 | 764 | ||||||||||||
Exchange adjustments
|
(13 | ) | (7 | ) | | (20 | ) | |||||||||
Additions
|
176 | | | 176 | ||||||||||||
Reclassified as held for sale
|
(4 | ) | | | (4 | ) | ||||||||||
Other reclassifications and disposals (i)
|
17 | | (14 | ) | 3 | |||||||||||
Cost at 31 March 2011
|
800 | 115 | 4 | 919 | ||||||||||||
Amortisation at 31 March 2009
|
(282 | ) | (10 | ) | (8 | ) | (300 | ) | ||||||||
Exchange adjustments
|
6 | | | 6 | ||||||||||||
Amortisation charge for the year
|
(52 | ) | (6 | ) | (5 | ) | (63 | ) | ||||||||
Impairment charge for the year
|
(7 | ) | (11 | ) | | (18 | ) | |||||||||
Reclassifications and disposals (i)
|
1 | | (1 | ) | | |||||||||||
Amortisation at 31 March 2010
|
(334 | ) | (27 | ) | (14 | ) | (375 | ) | ||||||||
Exchange adjustments
|
4 | 3 | | 7 | ||||||||||||
Amortisation charge for the year
|
(62 | ) | (7 | ) | (1 | ) | (70 | ) | ||||||||
Reclassified as held for sale
|
3 | | | 3 | ||||||||||||
Other reclassifications and disposals (i)
|
6 | | 11 | 17 | ||||||||||||
Amortisation at 31 March 2011
|
(383 | ) | (31 | ) | (4 | ) | (418 | ) | ||||||||
Net book value at 31 March 2011
|
417 | 84 | | 501 | ||||||||||||
Net book value at 31 March 2010
|
290 | 95 | 4 | 389 | ||||||||||||
(i) | Primarily represents reclassifications between property, plant and equipment, trade and other receivables and between categories. |
Assets | Motor | |||||||||||||||||||
in the | vehicles | |||||||||||||||||||
Land and | Plant and | course of | and office | |||||||||||||||||
buildings | machinery | construction | equipment | Total | ||||||||||||||||
£m | £m | £m | £m | £m | ||||||||||||||||
Cost at 31 March 2009
|
1,504 | 37,516 | 2,485 | 889 | 42,394 | |||||||||||||||
Exchange adjustments
|
(54 | ) | (765 | ) | (19 | ) | (2 | ) | (840 | ) | ||||||||||
Additions
|
43 | 893 | 2,108 | 104 | 3,148 | |||||||||||||||
Disposals
|
(12 | ) | (288 | ) | (2 | ) | (48 | ) | (350 | ) | ||||||||||
Reclassifications (i)
|
91 | 1,874 | (2,031 | ) | 83 | 17 | ||||||||||||||
Cost at 31 March 2010
|
1,572 | 39,230 | 2,541 | 1,026 | 44,369 | |||||||||||||||
Exchange adjustments
|
(56 | ) | (812 | ) | (30 | ) | (2 | ) | (900 | ) | ||||||||||
Additions
|
123 | 888 | 2,194 | 87 | 3,292 | |||||||||||||||
Disposals
|
(22 | ) | (305 | ) | | (25 | ) | (352 | ) | |||||||||||
Reclassified as held for sale
|
(5 | ) | (278 | ) | (3 | ) | (1 | ) | (287 | ) | ||||||||||
Reclassifications (i)
|
146 | 2,175 | (2,285 | ) | (33 | ) | 3 | |||||||||||||
Cost at 31 March 2011
|
1,758 | 40,898 | 2,417 | 1,052 | 46,125 | |||||||||||||||
Depreciation at 31 March 2009
|
(242 | ) | (12,084 | ) | | (523 | ) | (12,849 | ) | |||||||||||
Exchange adjustments
|
4 | 206 | | 2 | 212 | |||||||||||||||
Depreciation charge for the year (ii)
|
(30 | ) | (1,027 | ) | | (91 | ) | (1,148 | ) | |||||||||||
Impairment charge for the year (iii)
|
(3 | ) | (23 | ) | (2 | ) | (1 | ) | (29 | ) | ||||||||||
Disposals
|
10 | 261 | | 44 | 315 | |||||||||||||||
Reclassifications (i)
|
(22 | ) | 43 | | (36 | ) | (15 | ) | ||||||||||||
Depreciation at 31 March 2010
|
(283 | ) | (12,624 | ) | (2 | ) | (605 | ) | (13,514 | ) | ||||||||||
Exchange adjustments
|
7 | 218 | | | 225 | |||||||||||||||
Depreciation charge for the year (ii)
|
(39 | ) | (1,072 | ) | | (89 | ) | (1,200 | ) | |||||||||||
Impairment charge for the year (iv)
|
| (20 | ) | | | (20 | ) | |||||||||||||
Disposals
|
9 | 228 | | 19 | 256 | |||||||||||||||
Reclassified as held for sale
|
5 | 78 | | 1 | 84 | |||||||||||||||
Reclassifications (i)
|
(108 | ) | 92 | | 16 | | ||||||||||||||
Depreciation at 31 March 2011
|
(409 | ) | (13,100 | ) | (2 | ) | (658 | ) | (14,169 | ) | ||||||||||
Net book value at 31 March 2011
|
1,349 | 27,798 | 2,415 | 394 | 31,956 | |||||||||||||||
Net book value at 31 March 2010
|
1,289 | 26,606 | 2,539 | 421 | 30,855 | |||||||||||||||
(i) | Primarily represents reclassifications between categories, other intangible assets, trade and other receivables and other payables. |
(ii) | Includes amounts in respect of capitalised depreciation of £18m (2010: £17m). |
(iii) | Relates to write-down of the liquefied natural gas (LNG) storage facilities. |
(iv) | Relates to write-down of certain of our US generation assets. |
2011 | 2010 | |||||||
£m | £m | |||||||
Information in relation to property, plant and equipment
|
||||||||
Capitalised interest included within cost
|
1,023 | 903 | ||||||
Net book value of assets held under finance leases
|
199 | 202 | ||||||
Additions to assets held under finance leases
|
68 | 13 | ||||||
Contributions to cost of property, plant and equipment included within:
|
||||||||
Trade and other payables
|
40 | 39 | ||||||
Non-current liabilities
|
1,476 | 1,478 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Commodity contract assets
|
94 | 84 | ||||||
Other receivables
|
37 | 71 | ||||||
Prepayments
|
4 | 7 | ||||||
|
135 | 162 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Non-current
|
||||||||
Available-for-sale investments
|
237 | 236 | ||||||
Investments in joint ventures and associates (note 13a)
|
356 | 250 | ||||||
|
593 | 486 | ||||||
Current
|
||||||||
Available-for-sale investments
|
2,776 | 1,285 | ||||||
Loans and receivables
|
163 | 112 | ||||||
|
2,939 | 1,397 | ||||||
Total financial and other investments
|
3,532 | 1,883 | ||||||
Financial and other investments include the following:
|
||||||||
Investments in short-term money funds
|
2,498 | 1,000 | ||||||
Managed investments in equity and bonds (i)
|
388 | 385 | ||||||
Investment in joint ventures and associates (note 13a)
|
356 | 250 | ||||||
Cash surrender value of life insurance policies
|
127 | 126 | ||||||
Other investments
|
2 | 7 | ||||||
Restricted cash balances
|
||||||||
Collateral
|
96 | 58 | ||||||
Other
|
65 | 57 | ||||||
|
3,532 | 1,883 | ||||||
(i) | Includes £282m of current investments which are held by insurance captives and are therefore restricted. |
2011 | 2010 | |||||||
£m | £m | |||||||
Share of net assets at 1 April
|
250 | 168 | ||||||
Exchange adjustments
|
5 | (7 | ) | |||||
Additions
|
135 | 86 | ||||||
Share of retained profit for the year
|
7 | 8 | ||||||
Dividends received
|
(9 | ) | (18 | ) | ||||
Share of other comprehensive income
|
(7 | ) | 9 | |||||
Impairment charge (note 3)
|
(29 | ) | | |||||
Other movements
|
4 | 4 | ||||||
Share of net assets at 31 March
|
356 | 250 | ||||||
2011 | 2010 | |||||||||||||||||||||||
Assets | Liabilities | Total | Assets | Liabilities | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Fair value hedges
|
||||||||||||||||||||||||
Interest rate swaps
|
99 | (9 | ) | 90 | 128 | (4 | ) | 124 | ||||||||||||||||
Cross-currency interest rate swaps
|
450 | (4 | ) | 446 | 589 | (20 | ) | 569 | ||||||||||||||||
|
549 | (13 | ) | 536 | 717 | (24 | ) | 693 | ||||||||||||||||
Cash flow hedges
|
||||||||||||||||||||||||
Interest rate swaps
|
6 | (50 | ) | (44 | ) | 2 | (112 | ) | (110 | ) | ||||||||||||||
Cross-currency interest rate swaps
|
685 | (28 | ) | 657 | 924 | (16 | ) | 908 | ||||||||||||||||
Foreign exchange forward contracts
|
2 | (1 | ) | 1 | 2 | | 2 | |||||||||||||||||
|
693 | (79 | ) | 614 | 928 | (128 | ) | 800 | ||||||||||||||||
Net investment hedges
|
||||||||||||||||||||||||
Cross-currency interest rate swaps
|
179 | (329 | ) | (150 | ) | 135 | (660 | ) | (525 | ) | ||||||||||||||
Foreign exchange forward contracts
|
26 | (4 | ) | 22 | 5 | (42 | ) | (37 | ) | |||||||||||||||
|
205 | (333 | ) | (128 | ) | 140 | (702 | ) | (562 | ) | ||||||||||||||
Derivatives not in a formal hedge relationship
|
||||||||||||||||||||||||
Interest rate swaps
|
339 | (258 | ) | 81 | 200 | (233 | ) | (33 | ) | |||||||||||||||
Cross-currency interest rate swaps
|
50 | (4 | ) | 46 | 58 | (1 | ) | 57 | ||||||||||||||||
Foreign exchange forward contracts
|
19 | (4 | ) | 15 | 3 | (43 | ) | (40 | ) | |||||||||||||||
Forward rate agreements
|
| (20 | ) | (20 | ) | | (47 | ) | (47 | ) | ||||||||||||||
|
408 | (286 | ) | 122 | 261 | (324 | ) | (63 | ) | |||||||||||||||
|
1,855 | (711 | ) | 1,144 | 2,046 | (1,178 | ) | 868 | ||||||||||||||||
Hedge positions offset within derivative instruments
|
(117 | ) | 117 | | (304 | ) | 304 | | ||||||||||||||||
Total
|
1,738 | (594 | ) | 1,144 | 1,742 | (874 | ) | 868 | ||||||||||||||||
2011 |
2010 | |||||||||||||||||||||||
Assets | Liabilities | Total | Assets | Liabilities | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Less than 1 year
|
468 | (190 | ) | 278 | 248 | (212 | ) | 36 | ||||||||||||||||
Current
|
468 | (190 | ) | 278 | 248 | (212 | ) | 36 | ||||||||||||||||
In 1 2 years
|
129 | (45 | ) | 84 | 278 | (174 | ) | 104 | ||||||||||||||||
In 2 3 years
|
167 | (37 | ) | 130 | 152 | (69 | ) | 83 | ||||||||||||||||
In 3 4 years
|
96 | (28 | ) | 68 | 240 | (106 | ) | 134 | ||||||||||||||||
In 4 5 years
|
66 | (2 | ) | 64 | 57 | (14 | ) | 43 | ||||||||||||||||
More than 5 years
|
812 | (292 | ) | 520 | 767 | (299 | ) | 468 | ||||||||||||||||
Non-current
|
1,270 | (404 | ) | 866 | 1,494 | (662 | ) | 832 | ||||||||||||||||
|
1,738 | (594 | ) | 1,144 | 1,742 | (874 | ) | 868 | ||||||||||||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Interest rate swaps
|
(19,217 | ) | (13,320 | ) | ||||
Cross-currency interest rate swaps
|
(7,585 | ) | (9,528 | ) | ||||
Foreign exchange forward contracts
|
(4,028 | ) | (1,989 | ) | ||||
Forward rate agreements
|
(13,752 | ) | (10,454 | ) | ||||
Other
|
(314 | ) | (314 | ) | ||||
Total
|
(44,896 | ) | (35,605 | ) | ||||
*The notional contract amounts of derivatives indicate the gross nominal value of transactions outstanding at the balance sheet date |
2011 | 2010 | |||||||
£m | £m | |||||||
Fuel stocks
|
114 | 198 | ||||||
Raw materials and consumables
|
152 | 162 | ||||||
Work in progress
|
12 | 12 | ||||||
Current intangible assets emission allowances
|
42 | 35 | ||||||
|
320 | 407 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Trade receivables
|
1,163 | 1,296 | ||||||
Prepayments and accrued income
|
999 | 937 | ||||||
Commodity contract assets
|
16 | 21 | ||||||
Other receivables
|
34 | 39 | ||||||
|
2,212 | 2,293 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
At 1 April
|
311 | 303 | ||||||
Exchange adjustments
|
(16 | ) | (15 | ) | ||||
Charge for the year, net of recoveries
|
112 | 161 | ||||||
Uncollectible amounts written off against receivables
|
(124 | ) | (138 | ) | ||||
At 31 March
|
283 | 311 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Up to 3 months past due
|
136 | 111 | ||||||
3 to 6 months past due
|
34 | 35 | ||||||
Over 6 months past due
|
74 | 102 | ||||||
|
244 | 248 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Cash at bank
|
94 | 136 | ||||||
Short-term deposits
|
290 | 584 | ||||||
Cash and cash equivalents excluding bank overdrafts
|
384 | 720 | ||||||
Bank overdrafts
|
(42 | ) | (29 | ) | ||||
Net cash and cash equivalents
|
342 | 691 | ||||||
2011 | ||||||||
£m | ||||||||
Goodwill
|
12 | |||||||
Other intangible assets
|
1 | |||||||
Property, plant and equipment
|
203 | |||||||
Other receivables
|
40 | |||||||
Non-current assets
|
256 | |||||||
Inventories
|
5 | |||||||
Trade and other receivables
|
29 | |||||||
Current assets
|
34 | |||||||
Assets of businesses held for sale
|
290 | |||||||
|
||||||||
Trade and other payables
|
(17 | ) | ||||||
Current liabilities
|
(17 | ) | ||||||
Borrowings
|
(9 | ) | ||||||
Other non-current liabilities
|
(6 | ) | ||||||
Deferred tax liabilities
|
(29 | ) | ||||||
Pensions and other post-retirement benefit obligations
|
(9 | ) | ||||||
Provisions
|
(40 | ) | ||||||
Non-current liabilities
|
(93 | ) | ||||||
Liabilities of businesses held for sale
|
(110 | ) | ||||||
2011 |
2010 | |||||||
£m | £m | |||||||
Current
|
||||||||
Bank loans
|
831 | 890 | ||||||
Bonds
|
1,595 | 1,730 | ||||||
Commercial paper
|
457 | 121 | ||||||
Finance leases
|
20 | 29 | ||||||
Other loans
|
7 | 7 | ||||||
Bank overdrafts
|
42 | 29 | ||||||
|
2,952 | 2,806 | ||||||
Non-current
|
||||||||
Bank loans
|
2,118 | 2,163 | ||||||
Bonds
|
17,787 | 19,835 | ||||||
Finance leases
|
182 | 173 | ||||||
Other loans
|
159 | 147 | ||||||
|
20,246 | 22,318 | ||||||
Total
|
23,198 | 25,124 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
In one year or less
|
2,952 | 2,806 | ||||||
1-2 years
|
1,225 | 2,146 | ||||||
2-3 years
|
1,610 | 1,356 | ||||||
3-4 years
|
1,766 | 1,890 | ||||||
4-5 years
|
424 | 1,862 | ||||||
In more than 5 years:
|
||||||||
by instalments
|
77 | 22 | ||||||
other than by instalments
|
15,144 | 15,042 | ||||||
|
23,198 | 25,124 | ||||||
2011 |
2010 | |||||||
£m | £m | |||||||
Gross finance lease liabilities are repayable as follows:
|
||||||||
Less than 1 year
|
20 | 30 | ||||||
1-5 years
|
123 | 107 | ||||||
More than 5 years
|
105 | 135 | ||||||
|
248 | 272 | ||||||
Less: finance charges allocated to future periods
|
(46 | ) | (70 | ) | ||||
|
202 | 202 | ||||||
The present value of finance lease liabilities is as follows:
|
||||||||
Less than 1 year
|
20 | 29 | ||||||
1-5 years
|
104 | 86 | ||||||
More than 5 years
|
78 | 87 | ||||||
|
202 | 202 | ||||||
2011 |
2010 | |||||||
£m | £m | |||||||
Trade payables
|
1,720 | 1,702 | ||||||
Deferred income
|
261 | 244 | ||||||
Commodity contract liabilities
|
118 | 184 | ||||||
Social security and other taxes
|
129 | 132 | ||||||
Other payables
|
600 | 585 | ||||||
|
2,828 | 2,847 | ||||||
2011 |
2010 | |||||||
£m | £m | |||||||
Deferred income
|
1,564 | 1,566 | ||||||
Commodity contract liabilities
|
101 | 143 | ||||||
Other payables
|
279 | 265 | ||||||
|
1,944 | 1,974 | ||||||
Pensions | ||||||||||||||||||||||||
and other | ||||||||||||||||||||||||
Accelerated | Share- | post- | Other net | |||||||||||||||||||||
tax | based | retirement | Financial | temporary | ||||||||||||||||||||
depreciation | payments | benefits | instruments | differences | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Deferred tax assets at 31 March 2009
|
(2 | ) | (13 | ) | (1,457 | ) | (33 | ) | (504 | ) | (2,009 | ) | ||||||||||||
Deferred tax liabilities at 31 March 2009
|
4,299 | | 69 | 29 | 136 | 4,533 | ||||||||||||||||||
At 1 April 2009
|
4,297 | (13 | ) | (1,388 | ) | (4 | ) | (368 | ) | 2,524 | ||||||||||||||
Exchange adjustments
|
(54 | ) | | 84 | (3 | ) | 13 | 40 | ||||||||||||||||
Charged/(credited) to income statement
|
1,129 | 1 | 154 | (42 | ) | (314 | ) | 928 | ||||||||||||||||
Credited to equity
|
| | (175 | ) | | | (175 | ) | ||||||||||||||||
Other
|
(285 | ) | | 180 | (42 | ) | 154 | 7 | ||||||||||||||||
At 31 March 2010
|
5,087 | (12 | ) | (1,145 | ) | (91 | ) | (515 | ) | 3,324 | ||||||||||||||
Deferred tax assets at 31 March 2010
|
(2 | ) | (12 | ) | (1,235 | ) | (103 | ) | (657 | ) | (2,009 | ) | ||||||||||||
Deferred tax liabilities at 31 March 2010
|
5,089 | | 90 | 12 | 142 | 5,333 | ||||||||||||||||||
At 1 April 2010
|
5,087 | (12 | ) | (1,145 | ) | (91 | ) | (515 | ) | 3,324 | ||||||||||||||
Exchange adjustments
|
(122 | ) | | 49 | 4 | 29 | (40 | ) | ||||||||||||||||
Charged/(credited) to income statement
|
251 | (2 | ) | 137 | 32 | (67 | ) | 351 | ||||||||||||||||
(Credited)/charged to equity
|
| (4 | ) | 181 | 1 | | 178 | |||||||||||||||||
Reclassified as held for sale
|
(31 | ) | | 5 | | (3 | ) | (29 | ) | |||||||||||||||
Other
|
(1 | ) | | 2 | | (19 | ) | (18 | ) | |||||||||||||||
At 31 March 2011
|
5,184 | (18 | ) | (771 | ) | (54 | ) | (575 | ) | 3,766 | ||||||||||||||
Deferred tax assets at 31 March 2011
|
(2 | ) | (18 | ) | (882 | ) | (60 | ) | (706 | ) | (1,668 | ) | ||||||||||||
Deferred tax liabilities at 31 March 2011
|
5,186 | | 111 | 6 | 131 | 5,434 | ||||||||||||||||||
|
5,184 | (18 | ) | (771 | ) | (54 | ) | (575 | ) | 3,766 | ||||||||||||||
2011 |
2010 |
|||||||
£m | £m | |||||||
Deferred tax liabilities
|
3,766 | 3,324 | ||||||
Deferred tax assets
|
| | ||||||
|
3,766 | 3,324 | ||||||
2011 |
2010 |
|||||||
£m | £m | |||||||
Capital losses
|
368 | 401 | ||||||
Non-trade deficits
|
2 | 2 | ||||||
Trading losses
|
7 | 2 | ||||||
Pensions | US other post-retirement benefits | |||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Included within payroll costs
|
||||||||||||||||||||||||
Defined contribution scheme costs
|
11 | 7 | 5 | | | | ||||||||||||||||||
Defined benefit scheme costs:
|
||||||||||||||||||||||||
Current service cost
|
165 | 112 | 134 | 37 | 26 | 32 | ||||||||||||||||||
Past service cost
|
28 | 19 | | 3 | 6 | 7 | ||||||||||||||||||
Curtailment gain on redundancies
|
(4 | ) | (7 | ) | (4 | ) | (29 | ) | | | ||||||||||||||
Special termination benefits on redundancies
|
6 | 26 | 19 | | | | ||||||||||||||||||
Curtailment cost augmentations
|
2 | 4 | 6 | | | | ||||||||||||||||||
US healthcare reform cost
|
| | | | 9 | | ||||||||||||||||||
|
208 | 161 | 160 | 11 | 41 | 39 | ||||||||||||||||||
|
||||||||||||||||||||||||
Loss on sale of subsidiary undertaking
|
2 | | | | | | ||||||||||||||||||
|
||||||||||||||||||||||||
Interest cost
|
1,084 | 1,050 | 1,106 | 147 | 143 | 144 | ||||||||||||||||||
Expected return on plan assets
|
(1,185 | ) | (931 | ) | (1,163 | ) | (71 | ) | (50 | ) | (73 | ) | ||||||||||||
|
(101 | ) | 119 | (57 | ) | 76 | 93 | 71 | ||||||||||||||||
|
||||||||||||||||||||||||
Included within other comprehensive income
|
||||||||||||||||||||||||
Actuarial net gain/(loss) during the year
|
483 | (572 | ) | (1,906 | ) | 88 | (159 | ) | (112 | ) | ||||||||||||||
Exchange differences
|
38 | 64 | (141 | ) | 87 | 76 | (408 | ) | ||||||||||||||||
|
521 | (508 | ) | (2,047 | ) | 175 | (83 | ) | (520 | ) | ||||||||||||||
|
||||||||||||||||||||||||
Cumulative actuarial loss
|
(673 | ) | (1,156 | ) | (584 | ) | (274 | ) | (362 | ) | (203 | ) | ||||||||||||
Pensions | US other post-retirement benefits | |||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Present value of funded obligations
|
(19,255 | ) | (19,372 | ) | (15,797 | ) | (2,458 | ) | (2,602 | ) | (2,299 | ) | ||||||||||||
Fair value of plan assets
|
18,903 | 18,186 | 14,797 | 1,066 | 950 | 722 | ||||||||||||||||||
|
(352 | ) | (1,186 | ) | (1,000 | ) | (1,392 | ) | (1,652 | ) | (1,577 | ) | ||||||||||||
Present value of unfunded obligations
|
(225 | ) | (226 | ) | (203 | ) | | | | |||||||||||||||
Other post-employment liabilities
|
| | | (62 | ) | (62 | ) | (74 | ) | |||||||||||||||
Unrecognised past service cost
|
4 | | | 9 | 28 | 43 | ||||||||||||||||||
Net liability in the balance sheet
|
(573 | ) | (1,412 | ) | (1,203 | ) | (1,445 | ) | (1,686 | ) | (1,608 | ) | ||||||||||||
Liabilities
|
(1,129 | ) | (1,412 | ) | (1,472 | ) | (1,445 | ) | (1,686 | ) | (1,608 | ) | ||||||||||||
Assets
|
556 | | 269 | | | | ||||||||||||||||||
Net liability
|
(573 | ) | (1,412 | ) | (1,203 | ) | (1,445 | ) | (1,686 | ) | (1,608 | ) | ||||||||||||
Environ- | Decom- | Total | ||||||||||||||||||||||
mental | missioning | Restructuring | Emissions | Other | provisions | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
At 31 March 2009
|
1,104 | 108 | 100 | 25 | 362 | 1,699 | ||||||||||||||||||
Exchange adjustments
|
(46 | ) | (9 | ) | | (1 | ) | (12 | ) | (68 | ) | |||||||||||||
Additions
|
85 | 5 | 36 | 4 | 16 | 146 | ||||||||||||||||||
Reclassifications*
|
| | | | 70 | 70 | ||||||||||||||||||
Unused amounts reversed
|
(4 | ) | (1 | ) | (1 | ) | | (2 | ) | (8 | ) | |||||||||||||
Unwinding of discount
|
54 | 2 | | | 14 | 70 | ||||||||||||||||||
Utilised
|
(117 | ) | (8 | ) | (30 | ) | (6 | ) | (38 | ) | (199 | ) | ||||||||||||
At 31 March 2010
|
1,076 | 97 | 105 | 22 | 410 | 1,710 | ||||||||||||||||||
Exchange adjustments
|
(46 | ) | (5 | ) | (1 | ) | (1 | ) | (16 | ) | (69 | ) | ||||||||||||
Additions
|
167 | 43 | 87 | 9 | 30 | 336 | ||||||||||||||||||
Unused amounts reversed
|
(12 | ) | (7 | ) | (39 | ) | (6 | ) | (6 | ) | (70 | ) | ||||||||||||
Reclassified as held for sale
|
(39 | ) | (1 | ) | | | | (40 | ) | |||||||||||||||
Unwinding of discount
|
104 | 2 | | | 22 | 128 | ||||||||||||||||||
Utilised
|
(100 | ) | (9 | ) | (24 | ) | | (48 | ) | (181 | ) | |||||||||||||
At 31 March 2011
|
1,150 | 120 | 128 | 24 | 392 | 1,814 | ||||||||||||||||||
*Primarily represents reclassifications from other non-current liabilities |
2011 |
2010 |
|||||||
£m | £m | |||||||
Current
|
353 | 303 | ||||||
Non-current
|
1,461 | 1,407 | ||||||
|
1,814 | 1,710 | ||||||
2011 |
2010 |
|||||||||||||||||||
Discounted | Undiscounted | Discounted | Undiscounted | Real | ||||||||||||||||
£m | £m | £m | £m | discount rate | ||||||||||||||||
UK sites (i)
|
339 | 503 | 263 | 377 | 2.0 | % | ||||||||||||||
US sites (ii)
|
811 | 923 | 813 | 942 | 3.2 | % | ||||||||||||||
|
1,150 | 1,426 | 1,076 | 1,319 | ||||||||||||||||
(i) | The remediation expenditure in the UK relates to old gas manufacturing sites and also to electricity transmission sites. Cash flows are expected to be incurred between 2011 and 2060. A number of uncertainties affect the calculation of the provision, including the impact of regulation, accuracy of the site surveys, unexpected contaminants, transportation costs, the impact of alternative technologies and changes in the discount rate. This provision incorporates our best estimate of the financial effect of these uncertainties, but future material changes in any of the assumptions could materially impact the calculation of the provision. The undiscounted amount is the undiscounted best estimate of the liability having regard to these uncertainties. |
(ii) | The remediation expenditure in the US is expected to be incurred between 2011 and 2067. The uncertainties regarding the calculation of this provision are similar to those considered in respect of UK sites. However, unlike the UK, with the exception of immaterial amounts of such costs, this expenditure is expected to be recoverable from ratepayers under the terms of various rate agreements in the US. |
Allotted, called up | ||||||||
and fully paid | ||||||||
Ordinary shares | millions | £m | ||||||
At 31 March 2009
|
2,582 | 294 | ||||||
Issued during the year in lieu of dividends (i)
|
35 | 4 | ||||||
At 31 March 2010
|
2,617 | 298 | ||||||
Rights issue
|
990 | 113 | ||||||
Issued during the year in lieu of dividends (i)
|
41 | 5 | ||||||
At 31 March 2011
|
3,648 | 416 | ||||||
(i) | The issue of shares in lieu of cash dividends is considered to be a bonus issue under the terms of the Companies Act 2006 and the nominal value of the shares is charged to the share premium account. |
Cash flow | Available- | Capital | ||||||||||||||||||||||
Translation | hedge | for-sale | redemption | Merger | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
At 31 March 2008
|
(73 | ) | (42 | ) | 9 | 19 | (5,165 | ) | (5,252 | ) | ||||||||||||||
Exchange adjustments
|
457 | 5 | (3 | ) | | | 459 | |||||||||||||||||
Net (losses)/gains taken to equity
|
| (1 | ) | 9 | | | 8 | |||||||||||||||||
Transferred to profit or loss
|
| (53 | ) | (18 | ) | | | (71 | ) | |||||||||||||||
Deferred tax
|
| 19 | 7 | | | 26 | ||||||||||||||||||
At 31 March 2009
|
384 | (72 | ) | 4 | 19 | (5,165 | ) | (4,830 | ) | |||||||||||||||
Exchange adjustments
|
30 | 3 | 1 | | | 34 | ||||||||||||||||||
Net (losses)/gains taken to equity
|
| (45 | ) | 54 | | | 9 | |||||||||||||||||
Transferred to profit or loss
|
| 3 | (6 | ) | | | (3 | ) | ||||||||||||||||
Deferred tax
|
| 9 | (5 | ) | | | 4 | |||||||||||||||||
Share of other comprehensive income of joint ventures
|
| 5 | | | | 5 | ||||||||||||||||||
At 31 March 2010
|
414 | (97 | ) | 48 | 19 | (5,165 | ) | (4,781 | ) | |||||||||||||||
Exchange adjustments
|
(95 | ) | | | | | (95 | ) | ||||||||||||||||
Net gains taken to equity
|
| 7 | 16 | | | 23 | ||||||||||||||||||
Transferred to profit or loss
|
| (7 | ) | (3 | ) | | | (10 | ) | |||||||||||||||
Rights issue (i)
|
| | | | 3,101 | 3,101 | ||||||||||||||||||
Transfer to retained earnings (i)
|
| | | | (3,101 | ) | (3,101 | ) | ||||||||||||||||
Deferred tax
|
| (2 | ) | (1 | ) | | | (3 | ) | |||||||||||||||
Share of other comprehensive loss of joint ventures
|
| (4 | ) | | | | (4 | ) | ||||||||||||||||
At 31 March 2011
|
319 | (103 | ) | 60 | 19 | (5,165 | ) | (4,870 | ) | |||||||||||||||
(i) | For details of the rights issue and subsequent transfer to retained earnings see note 25. |
2011 |
2010 |
2009 |
||||||||||
£m | £m | £m | ||||||||||
Operating profit
|
| | 13 | |||||||||
Changes in working capital, provisions and pensions
|
| | (21 | ) | ||||||||
Cash flow relating to discontinued operations
|
| | (8 | ) | ||||||||
2011 |
2010 |
2009 |
||||||||||
£m | £m | £m | ||||||||||
Disposal proceeds (i)
|
| | 1,617 | |||||||||
Tax arising on disposal
|
| | (564 | ) | ||||||||
Other investing activities
|
| | (4 | ) | ||||||||
Cash flow relating to discontinued operations
|
| | 1,049 | |||||||||
(i) | Disposal proceeds are in respect of the sale of assets and liabilities classified as held for sale. |
2011 |
2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
(Decrease)/increase in cash and cash equivalents
|
(346 | ) | (28 | ) | 538 | |||||||
Increase/(decrease) in financial investments
|
1,577 | (805 | ) | (99 | ) | |||||||
Decrease/(increase) in borrowings and related derivatives
|
1,763 | 499 | (1,641 | ) | ||||||||
Net interest paid on the components of net debt
|
1,011 | 999 | 956 | |||||||||
Change in net debt resulting from cash flows
|
4,005 | 665 | (246 | ) | ||||||||
Changes in fair value of financial assets and liabilities and exchange movements
|
690 | 865 | (3,625 | ) | ||||||||
Net interest charge on the components of net debt
|
(1,228 | ) | (996 | ) | (1,161 | ) | ||||||
Reclassified as held for sale
|
9 | | | |||||||||
Other non-cash movements
|
(68 | ) | | | ||||||||
Movement in net debt (net of related derivative financial instruments) in the year
|
3,408 | 534 | (5,032 | ) | ||||||||
Net debt (net of related derivative financial instruments) at start of year
|
(22,139 | ) | (22,673 | ) | (17,641 | ) | ||||||
Net debt (net of related derivative financial instruments) at end of year
|
(18,731 | ) | (22,139 | ) | (22,673 | ) | ||||||
Cash | Net cash | |||||||||||||||||||||||||||
and cash | Bank | and cash | Financial | |||||||||||||||||||||||||
equivalents | overdrafts | equivalents | investments | Borrowings | Derivatives | Total (i) | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
At 31 March 2008
|
174 | (10 | ) | 164 | 2,095 | (20,993 | ) | 1,093 | (17,641 | ) | ||||||||||||||||||
Cash flow
|
545 | (7 | ) | 538 | (184 | ) | (1,316 | ) | 716 | (246 | ) | |||||||||||||||||
Fair value gains and losses and exchange movements
|
18 | | 18 | 207 | (3,222 | ) | (628 | ) | (3,625 | ) | ||||||||||||||||||
Interest charges
|
| | | 79 | (1,245 | ) | 5 | (1,161 | ) | |||||||||||||||||||
At 31 March 2009
|
737 | (17 | ) | 720 | 2,197 | (26,776 | ) | 1,186 | (22,673 | ) | ||||||||||||||||||
Cash flow
|
(16 | ) | (12 | ) | (28 | ) | (826 | ) | 2,079 | (560 | ) | 665 | ||||||||||||||||
Fair value gains and losses and exchange movements
|
(1 | ) | | (1 | ) | 2 | 644 | 220 | 865 | |||||||||||||||||||
Interest charges
|
| | | 24 | (1,042 | ) | 22 | (996 | ) | |||||||||||||||||||
At 31 March 2010
|
720 | (29 | ) | 691 | 1,397 | (25,095 | ) | 868 | (22,139 | ) | ||||||||||||||||||
Cash flow
|
(333 | ) | (13 | ) | (346 | ) | 1,551 | 2,933 | (133 | ) | 4,005 | |||||||||||||||||
Fair value gains and losses and exchange movements
|
(3 | ) | | (3 | ) | (34 | ) | 402 | 325 | 690 | ||||||||||||||||||
Interest charges
|
| | | 25 | (1,337 | ) | 84 | (1,228 | ) | |||||||||||||||||||
Reclassified as held for sale
|
| | | | 9 | | 9 | |||||||||||||||||||||
Other non-cash movements
|
| | | | (68 | ) | | (68 | ) | |||||||||||||||||||
At 31 March 2011
|
384 | (42 | ) | 342 | 2,939 | (23,156 | ) | 1,144 | (18,731 | ) | ||||||||||||||||||
Balances at 31 March 2011 comprise:
|
||||||||||||||||||||||||||||
Non-current assets
|
| | | | | 1,270 | 1,270 | |||||||||||||||||||||
Current assets
|
384 | | 384 | 2,939 | | 468 | 3,791 | |||||||||||||||||||||
Current liabilities
|
| (42 | ) | (42 | ) | | (2,910 | ) | (190 | ) | (3,142 | ) | ||||||||||||||||
Non-current liabilities
|
| | | | (20,246 | ) | (404 | ) | (20,650 | ) | ||||||||||||||||||
|
384 | (42 | ) | 342 | 2,939 | (23,156 | ) | 1,144 | (18,731 | ) | ||||||||||||||||||
(i) | Includes accrued interest at 31 March 2011 of £162m (2010: £232m). |
2011 |
2010 | |||||||
£m | £m | |||||||
Future capital expenditure
|
||||||||
Contracted for but not provided
|
1,614 | 1,738 | ||||||
Operating lease commitments
|
||||||||
Less than 1 year
|
83 | 91 | ||||||
In 1-2 years
|
79 | 84 | ||||||
In 2-3 years
|
93 | 79 | ||||||
In 3-4 years
|
72 | 96 | ||||||
In 4-5 years
|
70 | 76 | ||||||
More than 5 years
|
398 | 500 | ||||||
|
795 | 926 | ||||||
|
||||||||
Energy purchase commitments (i)*
|
||||||||
Less than 1 year
|
1,081 | 1,195 | ||||||
In 1-2 years
|
480 | 506 | ||||||
In 2-3 years
|
328 | 372 | ||||||
In 3-4 years
|
272 | 304 | ||||||
In 4-5 years
|
241 | 245 | ||||||
More than 5 years
|
1,141 | 1,326 | ||||||
|
3,543 | 3,948 | ||||||
|
||||||||
Guarantees and letters of credit
|
||||||||
Guarantee of sublease for US property (expires 2040)
|
328 | 377 | ||||||
Letter of credit and guarantee of certain obligations of BritNed Interconnector (expire 2011)
|
36 | 374 | ||||||
Guarantees of certain obligations of Grain LNG Import Terminal (expire up to 2028)
|
139 | 164 | ||||||
Other guarantees and letters of credit (various expiry dates)
|
259 | 274 | ||||||
|
762 | 1,189 | ||||||
*Comparatives have been restated to present items on a basis consistent with the current year classification | |
(i) | Energy commitments relate to contractual commitments to purchase electricity or gas that are used to satisfy physical delivery requirements to our customers or for energy that we use ourselves (ie normal purchase, sale or usage) and hence are accounted for as ordinary purchase contracts. Details of commodity contracts that do not meet the normal purchase, sale or usage criteria, and hence are accounted for as derivative contracts, are shown in note 33. |
2011 |
2010 |
2009 |
||||||||||
£m | £m | £m | ||||||||||
Sales: Services and goods supplied to a pension plan and joint ventures
|
11 | 5 | 4 | |||||||||
Purchases: Services and goods received from joint ventures (i)
|
84 | 73 | 44 | |||||||||
Interest income: Interest receivable on loans with joint ventures
|
2 | 1 | | |||||||||
|
||||||||||||
Receivable from a pension plan and joint ventures
|
2 | 1 | | |||||||||
Loan to joint venture (ii)
|
| 23 | | |||||||||
Payable to joint ventures
|
8 | 6 | 6 | |||||||||
|
||||||||||||
Dividends received from joint ventures (iii)
|
9 | 18 | | |||||||||
(i) | During the year the Company received services and goods from a number of joint ventures, including Iroquois Gas Transmission System, L.P. of £40m (2010: £38m) and Millennium Pipeline Company, LLC of £28m (2010: £26m) for the transportation of gas in the US. |
(ii) | Following a decision in August 2010 to cease investing in Blue-NG Limited (a joint venture), an impairment charge was recorded against the carrying value of the investment, together with provision against recovery of loans from National Grid to Blue-NG of £30m (2010: £23m) and associated interest receivable. For further details see note 3. |
(iii) | Dividends were received from Iroquois Gas Transmission System, L.P. of £9m (2010: £17m). |
NG UK pension scheme | NG section of ESPS | |||||||
Latest full actuarial valuation
|
31 March 2007 | 31 March 2007 | ||||||
Actuary
|
Towers Watson | Hewitt Associates | ||||||
Market value of scheme assets at latest valuation
|
£12,923m | £1,345m | ||||||
Actuarial value of benefits due to members
|
£(13,365)m | £(1,750)m | ||||||
Market value as percentage of benefits
|
97% | 77% | ||||||
Funding deficit
|
£442m | £405m | ||||||
Funding deficit (net of tax)
|
£327m | £300m | ||||||
UK pensions | US pensions | US other post-retirement benefits | ||||||||||||||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | 2011 | 2010 | 2009 | ||||||||||||||||||||||||||||
% | % | % | % | % | % | % | % | % | ||||||||||||||||||||||||||||
Equities (i)
|
34.5 | 36.8 | 35.2 | 51.5 | 52.8 | 50.4 | 76.5 | 68.6 | 63.7 | |||||||||||||||||||||||||||
Corporate bonds (ii)
|
30.3 | 32.3 | 32.7 | 40.7 | 41.5 | 42.3 | 22.6 | 24.8 | 34.2 | |||||||||||||||||||||||||||
Gilts
|
26.8 | 22.4 | 22.2 | | | | | | | |||||||||||||||||||||||||||
Property
|
5.9 | 5.9 | 5.4 | 2.0 | | | | | | |||||||||||||||||||||||||||
Other
|
2.5 | 2.6 | 4.5 | 5.8 | 5.7 | 7.3 | 0.9 | 6.6 | 2.1 | |||||||||||||||||||||||||||
Total
|
100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 | |||||||||||||||||||||||||||
(i) | Included within equities at 31 March 2011 were ordinary shares of National Grid plc with a value of £12m (2010: £17m; 2009: £17m). |
(ii) | Included within corporate bonds at 31 March 2011 was an investment in a number of bonds issued by subsidiary undertakings with a value of £39m. |
US | US | |||||||||||||||
NGUK PS | ESPS | pensions | OPEBs | |||||||||||||
% | % | % | % | |||||||||||||
Equities (i)
|
32 | 49 | 60 | 70 | ||||||||||||
Bonds, property and other
|
68 | 51 | 40 | 30 | ||||||||||||
Total
|
100 | 100 | 100 | 100 | ||||||||||||
(i) | Included within equities are hedge fund and active currency investments. |
UK pensions | US pensions | US other post-retirement benefits | ||||||||||||||||||||||||||||||||||
2011 | 2010 | 2009 | 2011 | 2010 | 2009 | 2011 | 2010 | 2009 | ||||||||||||||||||||||||||||
% | % | % | % | % | % | % | % | % | ||||||||||||||||||||||||||||
Discount rate (i)
|
5.5 | 5.6 | 6.8 | 5.9 | 6.1 | 7.3 | 5.9 | 6.1 | 7.3 | |||||||||||||||||||||||||||
Expected return on plan assets
|
6.1 | 6.4 | 6.2 | 7.2 | 7.5 | 7.8 | 7.1 | 7.2 | 7.4 | |||||||||||||||||||||||||||
Rate of increase in salaries (ii)
|
4.4 | 4.7 | 3.8 | 3.5 | 3.5 | 3.5 | 3.5 | 3.5 | 3.5 | |||||||||||||||||||||||||||
Rate of increase in pensions
in payment |
3.5 | 3.8 | 3.0 | | | | n/a | n/a | n/a | |||||||||||||||||||||||||||
Rate of increase in pensions
in deferment |
3.5 | 3.8 | 2.9 | | | | n/a | n/a | n/a | |||||||||||||||||||||||||||
Rate of increase in RPI
(or equivalent)(iii) |
3.5 | 3.8 | 2.9 | 2.2 | 2.4 | 2.3 | n/a | n/a | n/a | |||||||||||||||||||||||||||
Initial healthcare cost trend rate
|
n/a | n/a | n/a | n/a | n/a | n/a | 8.5 | 8.5 | 9.0 | |||||||||||||||||||||||||||
Ultimate healthcare cost trend rate
|
n/a | n/a | n/a | n/a | n/a | n/a | 5.0 | 5.0 | 5.0 | |||||||||||||||||||||||||||
(i) | The discount rates for pension liabilities have been determined by reference to appropriate yields on high quality corporate bonds prevailing in the UK and US debt markets at the balance sheet date. | |
(ii) | A promotional scale has also been used where appropriate. | |
(iii) | In September 2010, the UK Government changed the basis for statutory pension increases from the Retail Price Index (RPI) to the Consumer Price Index (CPI). The Scheme rules of National Grids two UK pension schemes specifically reference RPI. As a consequence the impact of the Governments move to CPI was predominantly limited to National Grids Guaranteed Minimum Pensions. The financial consequence of the change as at 31 March 2011 was an approximate £55m reduction in present value of the defined benefit obligation. |
2011 |
2010 | |||||||||||||||
UK | US | UK | US | |||||||||||||
years | years | years | years | |||||||||||||
Assumed life expectations for a retiree at age 65
|
||||||||||||||||
Today
|
||||||||||||||||
Males
|
22.4 | 18.8 | 21.0 | 18.8 | ||||||||||||
Females
|
24.9 | 20.8 | 23.4 | 20.8 | ||||||||||||
In 20 years
|
||||||||||||||||
Males
|
24.7 | 18.8 | 23.4 | 18.8 | ||||||||||||
Females
|
27.4 | 20.8 | 25.7 | 20.8 | ||||||||||||
Sensitivities to actuarial assumptions
|
||||||||||||||||
Change in pensions | Change in annual | |||||||||||||||
and OPEB liability | pension and OPEB cost | |||||||||||||||
2011 | 2010 | 2011 | 2010 | |||||||||||||
£m | £m | £m | £m | |||||||||||||
Sensitivities (all other assumptions held constant)
|
||||||||||||||||
0.1% change in discount rate
|
304 | 317 | 7 | 4 | ||||||||||||
0.5% change in long-term rate of increase in salaries
|
162 | 166 | 8 | 8 | ||||||||||||
Change of one year to life expectations at age 60
|
653 | 670 | 7 | 5 | ||||||||||||
2011 |
2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Sensitivities to a 1% change in assumed healthcare cost trend rates
|
||||||||||||
Increase
|
||||||||||||
Effect on the aggregate of the service costs and interest costs
|
28 | 25 | 29 | |||||||||
Effect on defined benefit obligations
|
330 | 348 | 294 | |||||||||
Decrease
|
||||||||||||
Effect on the aggregate of the service costs and interest costs
|
(23 | ) | (21 | ) | (24 | ) | ||||||
Effect on defined benefit obligations
|
(282 | ) | (298 | ) | (254 | ) | ||||||
2011 | 2010 | 2009 | 2008 | 2007 | ||||||||||||||||
£m | £m | £m | £m | £m | ||||||||||||||||
Present value of funded and unfunded obligations
|
(21,938 | ) | (22,200 | ) | (18,299 | ) | (18,175 | ) | (17,253 | ) | ||||||||||
Fair value of plan assets
|
19,969 | 19,136 | 15,519 | 17,273 | 15,999 | |||||||||||||||
|
(1,969 | ) | (3,064 | ) | (2,780 | ) | (902 | ) | (1,254 | ) | ||||||||||
Difference between the expected and actual return on plan assets
|
358 | 3,192 | (3,952 | ) | (911 | ) | (81 | ) | ||||||||||||
Experience gains/(losses) on plan liabilities
|
28 | 509 | (125 | ) | 152 | 9 | ||||||||||||||
Actuarial gains/(losses) on plan liabilities
|
213 | (3,923 | ) | 1,934 | 1,343 | 446 | ||||||||||||||
2011 | 2010 | |||||||||||||||||||||||||||||||||||||||
Sterling | Euro | Dollar | Other | Total | Sterling | Euro | Dollar | Other | Total | |||||||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||||||||||||
Cash and cash
equivalents |
319 | 1 | 64 | | 384 | 428 | 4 | 288 | | 720 | ||||||||||||||||||||||||||||||
Financial investments
|
1,046 | 111 | 1,696 | 86 | 2,939 | 455 | 127 | 736 | 79 | 1,397 | ||||||||||||||||||||||||||||||
Borrowings (i)
|
(10,565 | ) | (4,896 | ) | (7,113 | ) | (624 | ) | (23,198 | ) | (10,651 | ) | (6,361 | ) | (7,394 | ) | (718 | ) | (25,124 | ) | ||||||||||||||||||||
Pre-derivative position
|
(9,200 | ) | (4,784 | ) | (5,353 | ) | (538 | ) | (19,875 | ) | (9,768 | ) | (6,230 | ) | (6,370 | ) | (639 | ) | (23,007 | ) | ||||||||||||||||||||
Derivative effect
|
2,921 | 4,637 | (6,962 | ) | 548 | 1,144 | 438 | 6,172 | (6,388 | ) | 646 | 868 | ||||||||||||||||||||||||||||
Net debt position
|
(6,279 | ) | (147 | ) | (12,315 | ) | 10 | (18,731 | ) | (9,330 | ) | (58 | ) | (12,758 | ) | 7 | (22,139 | ) | ||||||||||||||||||||||
(i) | Includes bank overdrafts. |
2011 | 2010 | |||||||||||||||||||||||||||||||||||||||
Sterling | Euro | Dollar | Other | Total | Sterling | Euro | Dollar | Other | Total | |||||||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||||||||||||
Trade and other
receivables
|
91 | | 1,122 | | 1,213 | 128 | | 1,228 | | 1,356 | ||||||||||||||||||||||||||||||
Trade and other payables
|
(1,319 | ) | | (1,248 | ) | | (2,567 | ) | (1,221 | ) | | (1,382 | ) | | (2,603 | ) | ||||||||||||||||||||||||
Other non-current
liabilities
|
(26 | ) | | (354 | ) | | (380 | ) | (15 | ) | | (393 | ) | | (408 | ) | ||||||||||||||||||||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Fixed interest rate borrowings
|
||||||||
Less than 1 year
|
(1,313 | ) | (1,237 | ) | ||||
In 1-2 years
|
(808 | ) | (1,413 | ) | ||||
In 2-3 years
|
(1,467 | ) | (956 | ) | ||||
In 3-4 years
|
(1,189 | ) | (1,762 | ) | ||||
In 4-5 years
|
(307 | ) | (1,265 | ) | ||||
More than 5 years
|
(8,487 | ) | (8,791 | ) | ||||
|
(13,571 | ) | (15,424 | ) | ||||
Floating interest rate borrowings (including inflation linked)
|
(9,627 | ) | (9,700 | ) | ||||
Total borrowings
|
(23,198 | ) | (25,124 | ) | ||||
2011 | 2010 | |||||||||||||||||||||||||||||||||||||||
Fixed | Floating | Inflation | Fixed | Floating | Inflation | |||||||||||||||||||||||||||||||||||
rate | rate | linked | (i) | Other | (ii) | Total | rate | rate | linked | (i) | Other | (ii) | Total | |||||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||||||||||||
Cash and cash
equivalents
|
315 | 69 | | | 384 | 599 | 121 | | | 720 | ||||||||||||||||||||||||||||||
Financial investments
|
759 | 2,053 | | 127 | 2,939 | 602 | 673 | | 122 | 1,397 | ||||||||||||||||||||||||||||||
Borrowings (iii)
|
(13,571 | ) | (3,933 | ) | (5,694 | ) | | (23,198 | ) | (15,424 | ) | (4,604 | ) | (5,096 | ) | | (25,124 | ) | ||||||||||||||||||||||
Pre-derivative position
|
(12,497 | ) | (1,811 | ) | (5,694 | ) | 127 | (19,875 | ) | (14,223 | ) | (3,810 | ) | (5,096 | ) | 122 | (23,007 | ) | ||||||||||||||||||||||
Derivative effect (iv)
|
295 | 531 | 318 | | 1,144 | (1,552 | ) | 2,292 | 204 | (76 | ) | 868 | ||||||||||||||||||||||||||||
Net debt position
|
(12,202 | ) | (1,280 | ) | (5,376 | ) | 127 | (18,731 | ) | (15,775 | ) | (1,518 | ) | (4,892 | ) | 46 | (22,139 | ) | ||||||||||||||||||||||
(i) | The post-derivative impact represents financial instruments linked to UK RPI. |
(ii) | Represents financial instruments which are not directly affected by interest rate risk, such as investments in equity or other similar financial instruments. |
(iii) | Includes bank overdrafts. |
(iv) | The impact of 2011/12 (2010: 2010/11) maturing short-dated interest rate derivatives is included. |
2011 | 2010 | |||||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||||||
Assets
|
||||||||||||||||||||||||||||||||
Available-for-sale investments
|
2,834 | 179 | | 3,013 | 1,346 | 175 | | 1,521 | ||||||||||||||||||||||||
Derivative financial instruments
|
| 1,684 | 54 | 1,738 | | 1,706 | 36 | 1,742 | ||||||||||||||||||||||||
|
2,834 | 1,863 | 54 | 4,751 | 1,346 | 1,881 | 36 | 3,263 | ||||||||||||||||||||||||
Liabilities
|
||||||||||||||||||||||||||||||||
Derivative financial instruments
|
| (594 | ) | | (594 | ) | | (874 | ) | | (874 | ) | ||||||||||||||||||||
Total
|
2,834 | 1,269 | 54 | 4,157 | 1,346 | 1,007 | 36 | 2,389 | ||||||||||||||||||||||||
Level 1:
|
Financial instruments with quoted prices for identical instruments in active markets. | |
|
||
Level 2:
|
Financial instruments with quoted prices for similar instruments in active markets or quoted prices for identical or similar instruments in inactive markets and financial instruments valued using models where all significant inputs are based directly or indirectly on observable market data. | |
|
||
Level 3:
|
Financial instruments valued using valuation techniques where one or more significant inputs are based on unobservable market data. |
2011 | 2010 | |||||||
Level 3 | Level 3 | |||||||
valuation | valuation | |||||||
£m | £m | |||||||
At 1 April
|
36 | 10 | ||||||
Net gains for the year (i)
|
21 | 29 | ||||||
Settlements
|
(3 | ) | (3 | ) | ||||
At 31 March
|
54 | 36 | ||||||
(i) | Gains of £21m (2010: £29m) are attributable to assets or liabilities held at the end of the reporting period and have been recognised in finance costs in the income statement. |
Maximum limit | Long-term limit | |||||||
Rating | £m | £m | ||||||
AAA rated G8 sovereign entities
|
Unlimited | Unlimited | ||||||
Triple A vehicles
|
275 | 233 | ||||||
Triple A range institutions (AAA)
|
938 to 1,415 | 472 to 741 | ||||||
Double A range institutions (AA)
|
560 to 705 | 285 to 353 | ||||||
Single A range institutions (A)
|
192 to 275 | 99 to 140 | ||||||
Less | More | |||||||||||||||||||
than | than | |||||||||||||||||||
1 year | 1-2 years | 2-3 years | 3 years | Total | ||||||||||||||||
At 31 March 2011 | £m | £m | £m | £m | £m | |||||||||||||||
Non-derivative financial liabilities
|
||||||||||||||||||||
Borrowings, excluding finance lease liabilities
|
(2,616 | ) | (1,188 | ) | (1,574 | ) | (17,455 | ) | (22,833 | ) | ||||||||||
Interest payments on borrowings (i)
|
(828 | ) | (807 | ) | (741 | ) | (9,328 | ) | (11,704 | ) | ||||||||||
Finance lease liabilities
|
(20 | ) | (38 | ) | (33 | ) | (157 | ) | (248 | ) | ||||||||||
Other non interest-bearing liabilities
|
(2,320 | ) | (279 | ) | | | (2,599 | ) | ||||||||||||
|
||||||||||||||||||||
Derivative financial liabilities
|
||||||||||||||||||||
Derivative contracts receipts
|
1,596 | 407 | 649 | 1,606 | 4,258 | |||||||||||||||
Derivative contracts payments
|
(1,213 | ) | (169 | ) | (345 | ) | (1,345 | ) | (3,072 | ) | ||||||||||
Commodity contracts
|
(290 | ) | (84 | ) | (40 | ) | (43 | ) | (457 | ) | ||||||||||
Total at 31 March 2011
|
(5,691 | ) | (2,158 | ) | (2,084 | ) | (26,722 | ) | (36,655 | ) | ||||||||||
Less | More | |||||||||||||||||||
than | than | |||||||||||||||||||
1 year | 1-2 years | 2-3 years | 3 years | Total | ||||||||||||||||
At 31 March 2010 | £m | £m | £m | £m | £m | |||||||||||||||
Non-derivative financial liabilities
|
||||||||||||||||||||
Borrowings, excluding finance lease liabilities
|
(2,390 | ) | (2,100 | ) | (1,322 | ) | (18,927 | ) | (24,739 | ) | ||||||||||
Interest payments on borrowings (i)
|
(915 | ) | (874 | ) | (845 | ) | (9,829 | ) | (12,463 | ) | ||||||||||
Finance lease liabilities
|
(30 | ) | (53 | ) | (20 | ) | (169 | ) | (272 | ) | ||||||||||
Other non interest-bearing liabilities
|
(2,287 | ) | (265 | ) | | | (2,552 | ) | ||||||||||||
|
||||||||||||||||||||
Derivative financial liabilities
|
||||||||||||||||||||
Derivative contracts receipts
|
1,027 | 1,649 | 171 | 2,235 | 5,082 | |||||||||||||||
Derivative contracts payments
|
(859 | ) | (1,464 | ) | (104 | ) | (1,874 | ) | (4,301 | ) | ||||||||||
Commodity contracts
|
(488 | ) | (168 | ) | (35 | ) | (101 | ) | (792 | ) | ||||||||||
Total at 31 March 2010
|
(5,942 | ) | (3,275 | ) | (2,155 | ) | (28,665 | ) | (40,037 | ) | ||||||||||
(i) | The interest on borrowings is calculated based on borrowings held at 31 March without taking account of future issues. Floating rate interest is estimated using a forward interest rate curve as at 31 March. Payments are included on the basis of the earliest date on which the Company can be required to settle. |
= | the balance sheet sensitivity to interest rates relates only to derivative financial instruments and available-for-sale investments, as debt and other deposits are carried at amortised cost and so their carrying value does not change as interest rates move; | |
= | the sensitivity of accrued interest to movements in interest rates is calculated on net floating rate exposures on debt, deposits and derivative instruments; | |
= | changes in the carrying value of derivatives from movements in interest rates designated as cash flow hedges are assumed to be recorded fully within equity; | |
= | changes in the carrying value of derivative financial instruments designated as net investment hedges from movements in interest rates are recorded in the income statement as they are designated using the spot rather than the forward translation method. The impact of movements in the dollar to sterling exchange rate are recorded directly in equity; | |
= | changes in the carrying value of derivative financial instruments not in hedging relationships only affect the income statement; | |
= | all other changes in the carrying value of derivative financial instruments designated as hedges are fully effective with no impact on the income statement; | |
= | debt with a maturity below one year is floating rate for the accrued interest part of the calculation; | |
= | the floating leg of any swap or any floating rate debt is treated as not having any interest rate already set, therefore a change in interest rates affects a full 12 month period for the accrued interest portion of the sensitivity calculations; and | |
= | sensitivity to the retail price index does not take into account any changes to revenue or operating costs that are affected by the retail price index or inflation generally. |
2011 |
2010 |
|||||||||||||||
Income | Other equity | Income | Other equity | |||||||||||||
statement | reserves | statement | reserves | |||||||||||||
+/- £m | +/- £m | +/- £m | +/- £m | |||||||||||||
UK retail price index +/- 0.50%
|
19 | | 17 | | ||||||||||||
UK interest rates +/- 0.50%
|
38 | 50 | 51 | 71 | ||||||||||||
US interest rates +/- 0.50%
|
39 | 15 | 52 | 14 | ||||||||||||
US dollar exchange rate +/- 10%
|
44 | 636 | 68 | 623 | ||||||||||||
2011 |
2010 |
|||||||||||||||||||||||
Assets | Liabilities | Total | Assets | Liabilities | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Commodity purchase contracts accounted for as derivative contracts
|
||||||||||||||||||||||||
Forward purchases of electricity
|
| (101 | ) | (101 | ) | | (127 | ) | (127 | ) | ||||||||||||||
Forward purchases/sales of gas
|
42 | (83 | ) | (41 | ) | 51 | (101 | ) | (50 | ) | ||||||||||||||
|
||||||||||||||||||||||||
Derivative financial instruments linked to commodity prices
|
||||||||||||||||||||||||
Electricity swaps
|
4 | (18 | ) | (14 | ) | | (47 | ) | (47 | ) | ||||||||||||||
Electricity options
|
62 | | 62 | 51 | | 51 | ||||||||||||||||||
Gas swaps
|
2 | (17 | ) | (15 | ) | 3 | (52 | ) | (49 | ) | ||||||||||||||
|
110 | (219 | ) | (109 | ) | 105 | (327 | ) | (222 | ) | ||||||||||||||
2011 |
2010 |
|||||||||||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | |||||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | £m | |||||||||||||||||||||||||
Assets
|
||||||||||||||||||||||||||||||||
Commodity contracts
|
| 6 | 104 | 110 | | 2 | 103 | 105 | ||||||||||||||||||||||||
Liabilities
|
||||||||||||||||||||||||||||||||
Commodity contracts
|
| (36 | ) | (183 | ) | (219 | ) | | (100 | ) | (227 | ) | (327 | ) | ||||||||||||||||||
Total
|
| (30 | ) | (79 | ) | (109 | ) | | (98 | ) | (124 | ) | (222 | ) | ||||||||||||||||||
2011 |
2010 |
|||||||
£m | £m | |||||||
At 1 April 2010
|
(124 | ) | (115 | ) | ||||
Net gains for the year (i)
|
20 | 8 | ||||||
Purchases
|
(42 | ) | (12 | ) | ||||
Sales
|
| (1 | ) | |||||
Settlements
|
68 | | ||||||
Reclassification into level 3
|
| (3 | ) | |||||
Reclassification out of level 3
|
(1 | ) | (1 | ) | ||||
At 31 March 2011
|
(79 | ) | (124 | ) | ||||
(i) | Gains of £14m (2010: £67m loss) are attributable to assets or liabilities held at the end of the reporting period. |
2011 | 2010 | |||||||
Income | Income | |||||||
statement | statement | |||||||
£m | £m | |||||||
10% increase in commodity prices (i)
|
39 | 46 | ||||||
10% decrease in commodity prices (i)
|
(36 | ) | (39 | ) | ||||
10% increase in commodity volumes
|
(5 | ) | (9 | ) | ||||
10% decrease in commodity volumes
|
3 | 9 | ||||||
Forward curve extrapolation
|
(1 | ) | (12 | ) | ||||
(i) | Level 3 commodity price sensitivity is included within the sensitivity analysis disclosed in (d) below. |
2011 | 2010 | |||||||||||||||||||||||
Assets | Liabilities | Total | Assets | Liabilities | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Less than one year
|
16 | (118 | ) | (102 | ) | 21 | (184 | ) | (163 | ) | ||||||||||||||
Current
|
16 | (118 | ) | (102 | ) | 21 | (184 | ) | (163 | ) | ||||||||||||||
In 1 2 years
|
18 | (26 | ) | (8 | ) | 8 | (49 | ) | (41 | ) | ||||||||||||||
In 2 3 years
|
9 | (20 | ) | (11 | ) | 11 | (21 | ) | (10 | ) | ||||||||||||||
In 3 4 years
|
8 | (20 | ) | (12 | ) | 13 | (19 | ) | (6 | ) | ||||||||||||||
In 4 5 years
|
11 | (18 | ) | (7 | ) | 11 | (19 | ) | (8 | ) | ||||||||||||||
More than 5 years
|
48 | (17 | ) | 31 | 41 | (35 | ) | 6 | ||||||||||||||||
Non-current
|
94 | (101 | ) | (7 | ) | 84 | (143 | ) | (59 | ) | ||||||||||||||
Total
|
110 | (219 | ) | (109 | ) | 105 | (327 | ) | (222 | ) | ||||||||||||||
2011 | 2010 | |||||||
Forward purchases of electricity (i)
|
4,257 GWh | 3,883 GWh | ||||||
Forward purchases/sales of gas (ii)
|
12m Dth | 171m Dth | ||||||
Electricity swaps
|
2,559 GWh | 3,141 GWh | ||||||
Electricity options
|
30,248 GWh | 30,294 GWh | ||||||
Gas swaps
|
27m Dth | 59m Dth | ||||||
Gas options
|
9m Dth | | ||||||
NYMEX gas futures (iii)
|
18m Dth | 48m Dth | ||||||
(i) | Forward electricity purchases have terms up to 12 years. The contractual obligations under these contracts are £240m (2010: £269m). | |
(ii) | Forward gas purchases have terms up to 7 years. The contractual obligations under these contracts are £247m (2010: £434m). | |
(iii) | NYMEX gas futures have been offset with related margin accounts. |
2011 | 2010 | |||||||||||||||
Income | Other equity | Income | Other equity | |||||||||||||
statement | reserves | statement | reserves | |||||||||||||
£m | £m | £m | £m | |||||||||||||
10% increase in commodity prices
|
58 | | 71 | (1 | ) | |||||||||||
10% decrease in commodity prices
|
(54 | ) | | (64 | ) | 1 | ||||||||||
Issuer | Original Notional Value | Description of instrument | Due | |||||
Bonds
|
||||||||
British Transco Finance Inc.
|
USD 300m | 6.625% Fixed Rate | 2018 | |||||
British Transco International Finance BV
|
USD 1,500m | Zero Coupon Bond | 2021 | |||||
Brooklyn Union Gas Company
|
USD 153m | 4.7% GFRBs Series 1996 | 2021 | |||||
|
USD 400m | 5.6% Senior Unsecured Note | 2016 | |||||
KeySpan Corporation
|
USD 700m | MTN 7.625% (i) | 2010 | |||||
|
USD 250m | MTN 8.00% | 2030 | |||||
|
USD 307m | 5.803% Notes | 2035 | |||||
|
USD 150m | 4.65% Notes | 2013 | |||||
|
USD 150m | 5.875% Notes | 2033 | |||||
KeySpan Gas East Corporation
|
USD 500m | 5.819% Fixed Rate (ii) | 2041 | |||||
(National Grid Energy Delivery Long Island)
|
||||||||
Massachusetts Electric Company
|
USD 800m | 5.90% Fixed Rate | 2039 | |||||
National Grid Electricity Transmission plc
|
EUR 600m | 6.625% Fixed Rate | 2014 | |||||
|
GBP 250m | 4.75% Fixed Rate (i) | 2010 | |||||
|
GBP 300m | 2.983% Guaranteed Retail Price Index Linked | 2018 | |||||
|
GBP 220m | 3.806% Retail Price Index Linked | 2020 | |||||
|
GBP 450m | 5.875% Fixed Rate | 2024 | |||||
|
GBP 360m | 6.5% Fixed Rate | 2028 | |||||
|
GBP 200m | 1.6449% Retail Price Index Linked | 2036 | |||||
|
GBP 150m | 1.823% Retail Price Index Linked | 2056 | |||||
|
GBP 150m | 1.8575% Index Linked | 2039 | |||||
|
GBP 379m | 7.375% Fixed Rate | 2031 | |||||
National Grid Gas plc
|
GBP 300m | 6.0% Fixed Rate | 2017 | |||||
|
GBP 275m | 8.75% Fixed Rate | 2025 | |||||
|
GBP 100m | 1.6747% Retail Price Index Linked | 2036 | |||||
|
GBP 115m | 1.7298% Retail Price Index Linked | 2046 | |||||
|
GBP 100m | 1.6298% Retail Price Index Linked | 2048 | |||||
|
GBP 100m | 1.5522% Retail Price Index Linked | 2048 | |||||
|
GBP 300m | 1.754% Retail Price Index Linked | 2036 | |||||
|
GBP 140m | 1.7864% Index Linked | 2037 | |||||
|
GBP 100m | 1.9158% Index Linked | 2037 | |||||
|
GBP 100m | 1.7762% Index Linked | 2037 | |||||
|
GBP 100m | 1.7744% Index Linked | 2039 | |||||
|
GBP 100m | 1.8625% Index Linked | 2039 | |||||
|
GBP 484m | 6.375% Fixed Rate | 2020 | |||||
|
GBP 503m | 4.1875% Index Linked | 2022 | |||||
|
GBP 503m | 7.0% Fixed Rate | 2024 | |||||
|
EUR 800m | 5.125% Fixed Rate | 2013 | |||||
|
EUR 163m | 4.36% EUR-HICP Linked | 2018 | |||||
|
GBP 457m | 6.0% Fixed Rate | 2038 | |||||
Issuer | Original Notional Value | Description of instrument | Due | |||||
Bonds continued
|
||||||||
National Grid plc
|
CAD 200m | 4.98% Fixed Rate | 2011 | |||||
|
EUR 1,000m | 4.125% Fixed Rate | 2013 | |||||
|
EUR 600m | 5.0% Fixed Rate | 2018 | |||||
|
EUR 500m | 4.375% Fixed Rate | 2020 | |||||
|
EUR 600m | Floating Rate (i) | 2010 | |||||
|
EUR 750m | Floating Rate | 2012 | |||||
|
GBP 300m | 5.25% Fixed Rate | 2011 | |||||
|
GBP 310m | 5.5% Fixed Rate | 2013 | |||||
|
USD 1,000m | 6.3% Fixed Rate | 2016 | |||||
|
EUR 578m | 6.5% Fixed Rate | 2014 | |||||
|
GBP 414m | 6.125% Fixed Rate | 2014 | |||||
NGG Finance plc
|
EUR 750m | 6.125% Fixed Rate | 2011 | |||||
Niagara Mohawk Power Corporation
|
USD 750m | 4.881% Fixed Rate | 2019 | |||||
|
USD 500m | 3.553% Fixed Rate | 2014 | |||||
The Narragansett Electric Company
|
USD 250m | 4.534% Fixed Rate | 2020 | |||||
|
USD 300m | 5.638% Fixed Rate | 2040 | |||||
Bank loans and other loans
|
||||||||
National Grid plc
|
USD 200m | Floating Rate (i) | 2010 | |||||
|
USD 250m | Floating Rate (i) | 2014 | |||||
|
USD 150m | Floating Rate (i) | 2014 | |||||
National Grid Grain LNG Limited
|
GBP 120m | Floating Rate | 2014 | |||||
|
GBP 140m | Floating Rate | 2023 | |||||
National Grid Electricity Transmission plc
|
GBP 200m | Floating Rate | 2012 | |||||
|
GBP 200m | Floating Rate | 2017 | |||||
National Grid Gas plc
|
GBP 200m | Floating Rate | 2012 | |||||
|
GBP 180m | 1.88% Retail Price Index Linked | 2022 | |||||
|
GBP 190m | 2.14% Retail Price Index Linked | 2022 | |||||
|
GBP 360m | Retail Price Index Linked (ii) | 2024 | |||||
National Grid USA
|
USD 150m | Floating Rate (i) | 2011 | |||||
|
USD 250m | Floating Rate (ii) | 2014 | |||||
|
USD 150m | Floating Rate (ii) | 2014 | |||||
National Grid Holdings Limited
|
GBP 250m | 4.13840% Fixed Rate | 2011 | |||||
(i) | Matured or repurchased during the year ended 31 March 2011. | |
(ii) | Issued during the year ended 31 March 2011. |
2011 | 2010 | |||||||
£m | £m | |||||||
Undrawn committed borrowing facilities expiring:
|
||||||||
Less than 1 year
|
330 | 1,708 | ||||||
In 1-2 years
|
899 | 1,314 | ||||||
In 3-4 years
|
1,140 | | ||||||
In 4-5 years
|
529 | | ||||||
|
2,898 | 3,022 | ||||||
|
Sharesave scheme share options are offered to employees at 80% of the market price at the time of the invitation. The share options are exercisable on completion of a three and/or five year Save As You Earn contract. |
|
|
PSP awards delivered in National Grid shares (ADSs for US participants) are made to Executive Directors and senior employees. The criteria are based on the Companys total shareholder return (50%) when compared to FTSE 100 and annualised growth of the Companys EPS (50%) when compared to the growth in RPI. |
|
|
Deferred Share Plan 50% of any Annual Performance Plan awarded to the Executive Directors and a fixed percentage awarded to senior employees is automatically deferred into National Grid shares (ADSs for US participants) which are held in trust for three years before release. |
|
|
Retention Award Plans awards delivered in National Grid shares (ADSs for US participants) to senior employees and vest in equal tranches over two and four years provided the employee remains employed by the Company. |
2011 | 2010 | |||||||
millions | millions | |||||||
Awards of ordinary share equivalents at 1 April
|
10.2 | 11.0 | ||||||
Impact of rights issue
|
1.5 | | ||||||
Awards made
|
5.5 | 4.7 | ||||||
Lapses/forfeits
|
(1.5 | ) | (0.9 | ) | ||||
Awards vested
|
(0.9 | ) | (4.6 | ) | ||||
Awards of ordinary share equivalents at 31 March
|
14.8 | 10.2 | ||||||
Conditional awards available for release at 31 March
|
1.4 | 0.1 | ||||||
Sharesave scheme | Executive Share Option Plan | |||||||||||||||||||
Weighted | Weighted | |||||||||||||||||||
average | average | Total | ||||||||||||||||||
price | price | options | ||||||||||||||||||
£ | millions | £ | millions | millions | ||||||||||||||||
At 1 April 2009
|
4.74 | 20.1 | 4.95 | 1.5 | 21.6 | |||||||||||||||
Granted
|
5.20 | 3.7 | | | 3.7 | |||||||||||||||
Lapsed expired
|
5.38 | (0.9 | ) | 5.24 | (0.1 | ) | (1.0 | ) | ||||||||||||
Exercised
|
3.77 | (4.5 | ) | 4.93 | (0.5 | ) | (5.0 | ) | ||||||||||||
At 31 March 2010
|
5.05 | 18.4 | 4.92 | 0.9 | 19.3 | |||||||||||||||
Impact of rights issue
|
| 2.1 | | 0.1 | 2.2 | |||||||||||||||
Granted
|
4.45 | 3.9 | | | 3.9 | |||||||||||||||
Lapsed expired
|
4.57 | (1.4 | ) | 4.61 | (0.3 | ) | (1.7 | ) | ||||||||||||
Exercised
|
4.31 | (3.5 | ) | 4.37 | (0.2 | ) | (3.7 | ) | ||||||||||||
At 31 March 2011
|
4.43 | 19.5 | 4.03 | 0.5 | 20.0 | |||||||||||||||
Exercisable
|
||||||||||||||||||||
At 31 March 2011
|
4.83 | 1.2 | 4.03 | 0.4 | 1.6 | |||||||||||||||
At 31 March 2010
|
4.98 | 0.8 | 4.71 | 0.5 | 1.3 | |||||||||||||||
|
||||||||||||||||||||
Weighted average share price at exercise date
|
||||||||||||||||||||
Year ended 31 March 2011
|
5.53 | 3.5 | 5.59 | 0.2 | 3.7 | |||||||||||||||
Year ended 31 March 2010
|
5.74 | 4.5 | 6.03 | 0.5 | 5.0 | |||||||||||||||
2011 | 2010 | 2009 | ||||||||||
Share options
|
||||||||||||
Average share price at date of grant
|
564.5p | 676.0p | 684.0p | |||||||||
Average exercise price
|
445.0p | 520.0p | 488.0p | |||||||||
Average fair value
|
137.0p | 161.1p | 153.7p | |||||||||
Other share plans
|
||||||||||||
Average share price at date of grant
|
493.3p | 598.2p | 670.1p | |||||||||
Average fair value
|
327.8p | 355.6p | 458.1p | |||||||||
2011 | 2010 | 2009 | ||||||||||
Dividend yield (%)
|
4.4-5.0 | 4.4-5.0 | 4.4-5.0 | |||||||||
Volatility (%)
|
22.4-26.1 | 22.4-26.1 | 22.4-26.1 | |||||||||
Risk free investment rate (%)
|
2.5 | 2.5 | 2.5 | |||||||||
Average life (years)
|
4.0 | 4.0 | 4.2 | |||||||||
(i) | implied volatility in traded options over the Companys shares; | |
(ii) | historical volatility of the Companys shares over a term commensurate with the expected life of each option; and | |
(iii) | implied volatility of comparator companies where options in their shares are traded. |
2011 | 2010 | 2009 | ||||||||||
£m | £m | £m | ||||||||||
Share options exercised
|
||||||||||||
Cash received on exercise of all share options during the year
|
18 | 18 | 8 | |||||||||
Tax benefits realised from share options exercised during the year
|
3 | 8 | 4 | |||||||||
Principal activity | ||
National Grid Gas plc
|
Transmission and distribution of gas | |
National Grid Electricity Transmission plc
|
Transmission of electricity | |
New England Power Company (i)
|
Transmission of electricity | |
Massachusetts Electric Company (i)
|
Distribution of electricity | |
The Narragansett Electric Company (i)
|
Transmission and distribution of electricity | |
Niagara Mohawk Power Corporation (i)
|
Transmission of electricity and distribution of electricity and gas | |
National Grid Metering Limited
|
Metering services | |
Utility Metering Services Limited
|
Metering services | |
National Grid Grain LNG Limited
|
LNG importation and storage | |
Boston Gas Company (i)
|
Distribution of gas | |
National Grid Generation LLC (i)
|
Generation of electricity | |
KeySpan Gas East Corporation (i)
|
Distribution of gas | |
The Brooklyn Union Gas Company (i)
|
Distribution of gas | |
NGG Finance plc
|
Financing | |
National Grid Property Holdings Limited
|
Property services | |
National Grid Holdings One plc
|
Holding company | |
Lattice Group plc
|
Holding company | |
National Grid USA (i)
|
Holding company | |
Niagara Mohawk Holdings, Inc. (i)
|
Holding company | |
National Grid Commercial Holdings Limited
|
Holding company | |
National Grid Holdings Limited
|
Holding company | |
KeySpan Corporation (i)
|
Holding company | |
(i) | Incorporated in the US. |
% of ordinary | ||||
shares held | Principal activity | |||
BritNed Development Limited
|
50 | UK / Netherlands interconnector | ||
Millennium Pipeline Company, LLC (i)
|
26.25 | Transmission of gas | ||
Iroquois Gas Transmission System, L.P. (i)
|
20.4 | Transmission of gas | ||
(i) | Incorporated in the US. |
Parent | Subsidiary | |||||||||||||||||||||||||||
guarantor | Issuer of notes | guarantor | ||||||||||||||||||||||||||
Niagara | ||||||||||||||||||||||||||||
Mohawk | British | National | National | |||||||||||||||||||||||||
National | Power | Transco | Grid Gas | Other | Consolidation | Grid | ||||||||||||||||||||||
Grid plc | Corporation | Finance Inc. | plc | subsidiaries | adjustments | consolidated | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Revenue
|
| 2,606 | | 2,739 | 9,174 | (176 | ) | 14,343 | ||||||||||||||||||||
Operating costs
|
||||||||||||||||||||||||||||
Depreciation and amortisation
|
| (133 | ) | | (455 | ) | (664 | ) | | (1,252 | ) | |||||||||||||||||
Payroll costs
|
| (288 | ) | | (236 | ) | (972 | ) | | (1,496 | ) | |||||||||||||||||
Purchases of electricity
|
| (628 | ) | | | (854 | ) | | (1,482 | ) | ||||||||||||||||||
Purchases of gas
|
| (244 | ) | | (141 | ) | (1,635 | ) | | (2,020 | ) | |||||||||||||||||
Rates and property taxes
|
| (151 | ) | | (239 | ) | (555 | ) | | (945 | ) | |||||||||||||||||
Balancing Service Incentive Scheme
|
| | | | (581 | ) | | (581 | ) | |||||||||||||||||||
Payments to Scottish transmission owners
|
| | | | (298 | ) | | (298 | ) | |||||||||||||||||||
Other operating costs
|
| (375 | ) | | (489 | ) | (1,836 | ) | 176 | (2,524 | ) | |||||||||||||||||
|
| (1,819 | ) | | (1,560 | ) | (7,395 | ) | 176 | (10,598 | ) | |||||||||||||||||
Operating profit
|
| 787 | | 1,179 | 1,779 | | 3,745 | |||||||||||||||||||||
Net finance costs
|
(261 | ) | (119 | ) | | (395 | ) | (353 | ) | | (1,128 | ) | ||||||||||||||||
Dividends receivable
|
| | | | 400 | (400 | ) | | ||||||||||||||||||||
Interest in equity accounted affiliates
|
2,360 | | | 7 | 7 | (2,367 | ) | 7 | ||||||||||||||||||||
Profit before tax
|
2,099 | 668 | | 791 | 1,833 | (2,767 | ) | 2,624 | ||||||||||||||||||||
Taxation
|
64 | (236 | ) | | (97 | ) | (192 | ) | | (461 | ) | |||||||||||||||||
Profit for the year from continuing operations
|
2,163 | 432 | | 694 | 1,641 | (2,767 | ) | 2,163 | ||||||||||||||||||||
Profit for the year from discontinued operations
|
| | | | | | | |||||||||||||||||||||
Profit for the year
|
2,163 | 432 | | (i) | 694 | 1,641 | (2,767 | ) | 2,163 | |||||||||||||||||||
Attributable to:
|
||||||||||||||||||||||||||||
Equity shareholders
|
2,159 | 432 | | 694 | 1,637 | (2,763 | ) | 2,159 | ||||||||||||||||||||
Non-controlling interests
|
4 | | | | 4 | (4 | ) | 4 | ||||||||||||||||||||
|
2,163 | 432 | | 694 | 1,641 | (2,767 | ) | 2,163 | ||||||||||||||||||||
(i) | Profit for the year for British Transco Finance Inc. is £nil as interest payable to external bond holders is offset by interest receivable on loans to National Grid Gas plc. |
Parent | Subsidiary | |||||||||||||||||||||||||||
guarantor | Issuer of notes | guarantor | ||||||||||||||||||||||||||
Niagara | ||||||||||||||||||||||||||||
Mohawk | British | National | National | |||||||||||||||||||||||||
National | Power | Transco | Grid Gas | Other | Consolidation | Grid | ||||||||||||||||||||||
Grid plc | Corporation | Finance Inc. | plc | subsidiaries | adjustments | consolidated | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Revenue
|
| 2,409 | | 2,787 | 9,008 | (197 | ) | 14,007 | ||||||||||||||||||||
Operating costs
|
||||||||||||||||||||||||||||
Depreciation and amortisation
|
| (131 | ) | | (430 | ) | (633 | ) | | (1,194 | ) | |||||||||||||||||
Payroll costs
|
| (274 | ) | | (224 | ) | (904 | ) | | (1,402 | ) | |||||||||||||||||
Purchases of electricity
|
| (575 | ) | | | (998 | ) | | (1,573 | ) | ||||||||||||||||||
Purchases of gas
|
| (253 | ) | | (155 | ) | (1,834 | ) | | (2,242 | ) | |||||||||||||||||
Rates and property taxes
|
| (126 | ) | | (248 | ) | (533 | ) | | (907 | ) | |||||||||||||||||
Balancing Service Incentive Scheme
|
| | | | (691 | ) | | (691 | ) | |||||||||||||||||||
Payments to Scottish transmission owners
|
| | | | (260 | ) | | (260 | ) | |||||||||||||||||||
Other operating costs
|
4 | (435 | ) | | (633 | ) | (1,578 | ) | 197 | (2,445 | ) | |||||||||||||||||
|
4 | (1,794 | ) | | (1,690 | ) | (7,431 | ) | 197 | (10,714 | ) | |||||||||||||||||
Operating profit
|
4 | 615 | | 1,097 | 1,577 | | 3,293 | |||||||||||||||||||||
Net finance costs
|
(227 | ) | (96 | ) | | (224 | ) | (561 | ) | | (1,108 | ) | ||||||||||||||||
Dividends receivable
|
| | | | 300 | (300 | ) | | ||||||||||||||||||||
Interest in equity accounted affiliates
|
1,558 | | | 12 | 8 | (1,570 | ) | 8 | ||||||||||||||||||||
Profit before tax
|
1,335 | 519 | | 885 | 1,324 | (1,870 | ) | 2,193 | ||||||||||||||||||||
Taxation
|
54 | (225 | ) | | (285 | ) | (348 | ) | | (804 | ) | |||||||||||||||||
Profit for the year from continuing operations
|
1,389 | 294 | | 600 | 976 | (1,870 | ) | 1,389 | ||||||||||||||||||||
Profit for the year from discontinued operations
|
| | | | | | | |||||||||||||||||||||
Profit for the year
|
1,389 | 294 | | (i) | 600 | 976 | (1,870 | ) | 1,389 | |||||||||||||||||||
Attributable to:
|
||||||||||||||||||||||||||||
Equity shareholders
|
1,386 | 294 | | 600 | 973 | (1,867 | ) | 1,386 | ||||||||||||||||||||
Non-controlling interests
|
3 | | | | 3 | (3 | ) | 3 | ||||||||||||||||||||
|
1,389 | 294 | | 600 | 976 | (1,870 | ) | 1,389 | ||||||||||||||||||||
(i) | Profit for the year for British Transco Finance Inc. is £nil as interest payable to external bond holders is offset by interest receivable on loans to National Grid Gas plc. |
Parent | Subsidiary | |||||||||||||||||||||||||||
guarantor | Issuer of notes | guarantor | ||||||||||||||||||||||||||
Niagara | ||||||||||||||||||||||||||||
Mohawk | British | National | National | |||||||||||||||||||||||||
National | Power | Transco | Grid Gas | Other | Consolidation | Grid | ||||||||||||||||||||||
Grid plc | Corporation | Finance Inc. | plc | subsidiaries | adjustments | consolidated | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Revenue
|
| 2,708 | | 2,632 | 10,585 | (238 | ) | 15,687 | ||||||||||||||||||||
Operating costs
|
||||||||||||||||||||||||||||
Depreciation and amortisation
|
| (135 | ) | | (413 | ) | (579 | ) | | (1,127 | ) | |||||||||||||||||
Payroll costs
|
| (269 | ) | | (239 | ) | (941 | ) | | (1,449 | ) | |||||||||||||||||
Purchases of electricity
|
| (735 | ) | | | (1,492 | ) | | (2,227 | ) | ||||||||||||||||||
Purchases of gas
|
| (374 | ) | | (168 | ) | (3,020 | ) | | (3,562 | ) | |||||||||||||||||
Rates and property taxes
|
| (132 | ) | | (236 | ) | (513 | ) | | (881 | ) | |||||||||||||||||
Balancing Service Incentive Scheme
|
| | | | (904 | ) | | (904 | ) | |||||||||||||||||||
Payments to Scottish transmission owners
|
| | | | (243 | ) | | (243 | ) | |||||||||||||||||||
Other operating costs
|
| (438 | ) | | (818 | ) | (1,653 | ) | 238 | (2,671 | ) | |||||||||||||||||
|
| (2,083 | ) | | (1,874 | ) | (9,345 | ) | 238 | (13,064 | ) | |||||||||||||||||
Operating profit
|
| 625 | | 758 | 1,240 | | 2,623 | |||||||||||||||||||||
Net finance costs
|
(213 | ) | (115 | ) | | (400 | ) | (506 | ) | | (1,234 | ) | ||||||||||||||||
Dividends receivable
|
592 | | | | 300 | (892 | ) | | ||||||||||||||||||||
Interest in equity accounted affiliates
|
551 | | | (3 | ) | 5 | (548 | ) | 5 | |||||||||||||||||||
Profit before tax
|
930 | 510 | | 355 | 1,039 | (1,440 | ) | 1,394 | ||||||||||||||||||||
Taxation
|
(8 | ) | (185 | ) | | (307 | ) | 28 | | (472 | ) | |||||||||||||||||
Profit for the year from continuing operations
|
922 | 325 | | 48 | 1,067 | (1,440 | ) | 922 | ||||||||||||||||||||
Profit for the year from discontinued operations
|
25 | | | | 25 | (25 | ) | 25 | ||||||||||||||||||||
Profit for the year
|
947 | 325 | | (i) | 48 | 1,092 | (1,465 | ) | 947 | |||||||||||||||||||
Attributable to:
|
||||||||||||||||||||||||||||
Equity shareholders
|
944 | 325 | | 48 | 1,092 | (1,465 | ) | 944 | ||||||||||||||||||||
Non-controlling interests
|
3 | | | | | | 3 | |||||||||||||||||||||
|
947 | 325 | | 48 | 1,092 | (1,465 | ) | 947 | ||||||||||||||||||||
(i) | Profit for the year for British Transco Finance Inc. is £nil as interest payable to external bond holders is offset by interest receivable on loans to National Grid Gas plc. |
Parent | Subsidiary | |||||||||||||||||||||||||||
guarantor | Issuer of notes | guarantor | ||||||||||||||||||||||||||
Niagara | ||||||||||||||||||||||||||||
Mohawk | British | National | National | |||||||||||||||||||||||||
National | Power | Transco | Grid Gas | Other | Consolidation | Grid | ||||||||||||||||||||||
Grid plc | Corporation | Finance Inc. | plc | subsidiaries | adjustments | consolidated | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Non-current assets
|
||||||||||||||||||||||||||||
Goodwill
|
| 697 | | | 4,079 | | 4,776 | |||||||||||||||||||||
Other intangible assets
|
| 4 | | 185 | 312 | | 501 | |||||||||||||||||||||
Property, plant and equipment
|
| 3,876 | | 11,290 | 16,790 | | 31,956 | |||||||||||||||||||||
Deferred tax assets
|
4 | | | | | (4 | ) | | ||||||||||||||||||||
Other non-current assets
|
| 64 | | 10 | 61 | | 135 | |||||||||||||||||||||
Amounts owed by subsidiary undertakings
|
311 | | | 5,611 | | (5,922 | ) | | ||||||||||||||||||||
Pension assets
|
| 154 | | | 402 | | 556 | |||||||||||||||||||||
Financial and other investments
|
9,504 | 20 | | 30 | 9,841 | (18,802 | ) | 593 | ||||||||||||||||||||
Derivative financial assets
|
576 | | | 535 | 159 | | 1,270 | |||||||||||||||||||||
Total non-current assets
|
10,395 | 4,815 | | 17,661 | 31,644 | (24,728 | ) | 39,787 | ||||||||||||||||||||
Current assets
|
||||||||||||||||||||||||||||
Inventories and current intangible assets
|
| 24 | | 40 | 256 | | 320 | |||||||||||||||||||||
Trade and other receivables
|
3 | 498 | | 217 | 1,494 | | 2,212 | |||||||||||||||||||||
Amounts owed by subsidiary undertakings
|
9,985 | 16 | 190 | 107 | 9,552 | (19,850 | ) | | ||||||||||||||||||||
Financial and other investments
|
1,424 | 12 | | 223 | 1,280 | | 2,939 | |||||||||||||||||||||
Derivative financial assets
|
244 | | | 80 | 198 | (54 | ) | 468 | ||||||||||||||||||||
Cash and cash equivalents
|
200 | 2 | | 83 | 99 | | 384 | |||||||||||||||||||||
Total current assets
|
11,856 | 552 | 190 | 750 | 12,879 | (19,904 | ) | 6,323 | ||||||||||||||||||||
Assets of businesses held for sale
|
| | | | 290 | | 290 | |||||||||||||||||||||
Total assets
|
22,251 | 5,367 | 190 | 18,411 | 44,813 | (44,632 | ) | 46,400 | ||||||||||||||||||||
Current liabilities
|
||||||||||||||||||||||||||||
Borrowings
|
(1,125 | ) | (11 | ) | (4 | ) | (410 | ) | (1,402 | ) | | (2,952 | ) | |||||||||||||||
Derivative financial liabilities
|
(194 | ) | | | (22 | ) | (28 | ) | 54 | (190 | ) | |||||||||||||||||
Trade and other payables
|
(34 | ) | (259 | ) | | (654 | ) | (1,881 | ) | | (2,828 | ) | ||||||||||||||||
Amounts owed to subsidiary undertakings
|
(7,957 | ) | (422 | ) | | (1,171 | ) | (10,300 | ) | 19,850 | | |||||||||||||||||
Current tax liabilities
|
| (222 | ) | | (23 | ) | (258 | ) | | (503 | ) | |||||||||||||||||
Provisions
|
| (22 | ) | | (79 | ) | (252 | ) | | (353 | ) | |||||||||||||||||
Total current liabilities
|
(9,310 | ) | (936 | ) | (4 | ) | (2,359 | ) | (14,121 | ) | 19,904 | (6,826 | ) | |||||||||||||||
Non-current liabilities
|
||||||||||||||||||||||||||||
Borrowings
|
(3,628 | ) | (1,293 | ) | (186 | ) | (6,535 | ) | (8,604 | ) | | (20,246 | ) | |||||||||||||||
Derivative financial liabilities
|
(253 | ) | | | (85 | ) | (66 | ) | | (404 | ) | |||||||||||||||||
Other non-current liabilities
|
| (291 | ) | | (1,097 | ) | (556 | ) | | (1,944 | ) | |||||||||||||||||
Amounts owed to subsidiary undertakings
|
| | | | (5,922 | ) | 5,922 | | ||||||||||||||||||||
Deferred tax liabilities
|
| (286 | ) | | (1,873 | ) | (1,611 | ) | 4 | (3,766 | ) | |||||||||||||||||
Pensions and other post-retirement benefit obligations
|
| (967 | ) | | | (1,607 | ) | | (2,574 | ) | ||||||||||||||||||
Provisions
|
| (243 | ) | | (121 | ) | (1,097 | ) | | (1,461 | ) | |||||||||||||||||
Total non-current liabilities
|
(3,881 | ) | (3,080 | ) | (186 | ) | (9,711 | ) | (19,463 | ) | 5,926 | (30,395 | ) | |||||||||||||||
Liabilities of businesses held for sale
|
| | | | (110 | ) | | (110 | ) | |||||||||||||||||||
Total liabilities
|
(13,191 | ) | (4,016 | ) | (190 | ) | (12,070 | ) | (33,694 | ) | 25,830 | (37,331 | ) | |||||||||||||||
Net assets
|
9,060 | 1,351 | | 6,341 | 11,119 | (18,802 | ) | 9,069 | ||||||||||||||||||||
Equity
|
||||||||||||||||||||||||||||
Called up share capital
|
416 | 116 | | 45 | 183 | (344 | ) | 416 | ||||||||||||||||||||
Share premium account
|
1,361 | 1,825 | | 204 | 7,183 | (9,212 | ) | 1,361 | ||||||||||||||||||||
Retained earnings
|
12,153 | (591 | ) | | 4,796 | 3,962 | (8,167 | ) | 12,153 | |||||||||||||||||||
Other equity reserves
|
(4,870 | ) | 1 | | 1,296 | (218 | ) | (1,079 | ) | (4,870 | ) | |||||||||||||||||
Shareholders equity
|
9,060 | 1,351 | | 6,341 | 11,110 | (18,802 | ) | 9,060 | ||||||||||||||||||||
Non-controlling interests
|
| | | | 9 | | 9 | |||||||||||||||||||||
Total equity
|
9,060 | 1,351 | | 6,341 | 11,119 | (18,802 | ) | 9,069 | ||||||||||||||||||||
Parent | Subsidiary | |||||||||||||||||||||||||||
guarantor | Issuer of notes | guarantor | ||||||||||||||||||||||||||
Niagara | ||||||||||||||||||||||||||||
Mohawk | British | National | National | |||||||||||||||||||||||||
National | Power | Transco | Grid Gas | Other | Consolidation | Grid | ||||||||||||||||||||||
Grid plc | Corporation | Finance Inc. | plc | subsidiaries | adjustments | consolidated | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Non-current assets
|
||||||||||||||||||||||||||||
Goodwill
|
| 738 | | | 4,364 | | 5,102 | |||||||||||||||||||||
Other intangible assets
|
| 3 | | 126 | 260 | | 389 | |||||||||||||||||||||
Property, plant and equipment
|
| 3,920 | | 10,817 | 16,118 | | 30,855 | |||||||||||||||||||||
Deferred tax assets
|
2 | | | | | (2 | ) | | ||||||||||||||||||||
Other non-current assets
|
| | | 7 | 155 | | 162 | |||||||||||||||||||||
Amounts owed by subsidiary undertakings
|
1,700 | | | 5,611 | 1,127 | (8,438 | ) | | ||||||||||||||||||||
Pension assets
|
| | | | | | | |||||||||||||||||||||
Financial and other investments
|
6,954 | 23 | | 25 | 9,731 | (16,247 | ) | 486 | ||||||||||||||||||||
Derivative financial assets
|
655 | 51 | | 564 | 224 | | 1,494 | |||||||||||||||||||||
Total non-current assets
|
9,311 | 4,735 | | 17,150 | 31,979 | (24,687 | ) | 38,488 | ||||||||||||||||||||
Current assets
|
||||||||||||||||||||||||||||
Inventories and current intangible assets
|
| 30 | | 44 | 333 | | 407 | |||||||||||||||||||||
Trade and other receivables
|
6 | 503 | | 270 | 1,524 | (10 | ) | 2,293 | ||||||||||||||||||||
Amounts owed by subsidiary undertakings
|
8,649 | | 202 | 114 | 7,862 | (16,827 | ) | | ||||||||||||||||||||
Financial and other investments
|
180 | 17 | | 307 | 893 | | 1,397 | |||||||||||||||||||||
Derivative financial assets
|
218 | 1 | | 72 | 43 | (86 | ) | 248 | ||||||||||||||||||||
Cash and cash equivalents
|
198 | 2 | | | 520 | | 720 | |||||||||||||||||||||
Total current assets
|
9,251 | 553 | 202 | 807 | 11,175 | (16,923 | ) | 5,065 | ||||||||||||||||||||
Assets of businesses held for sale
|
| | | | | | | |||||||||||||||||||||
Total assets
|
18,562 | 5,288 | 202 | 17,957 | 43,154 | (41,610 | ) | 43,553 | ||||||||||||||||||||
Current liabilities
|
||||||||||||||||||||||||||||
Borrowings
|
(1,183 | ) | (27 | ) | (5 | ) | (371 | ) | (1,220 | ) | | (2,806 | ) | |||||||||||||||
Derivative financial liabilities
|
(174 | ) | | | (30 | ) | (94 | ) | 86 | (212 | ) | |||||||||||||||||
Trade and other payables
|
(30 | ) | (310 | ) | | (665 | ) | (1,842 | ) | | (2,847 | ) | ||||||||||||||||
Amounts owed to subsidiary undertakings
|
(6,701 | ) | (220 | ) | | (942 | ) | (8,964 | ) | 16,827 | | |||||||||||||||||
Current tax liabilities
|
| (32 | ) | | | (369 | ) | 10 | (391 | ) | ||||||||||||||||||
Provisions
|
| (36 | ) | | (62 | ) | (205 | ) | | (303 | ) | |||||||||||||||||
Total current liabilities
|
(8,088 | ) | (625 | ) | (5 | ) | (2,070 | ) | (12,694 | ) | 16,923 | (6,559 | ) | |||||||||||||||
Non-current liabilities
|
||||||||||||||||||||||||||||
Borrowings
|
(5,307 | ) | (1,358 | ) | (197 | ) | (6,387 | ) | (9,069 | ) | | (22,318 | ) | |||||||||||||||
Derivative financial liabilities
|
(431 | ) | | | (121 | ) | (110 | ) | | (662 | ) | |||||||||||||||||
Other non-current liabilities
|
| (256 | ) | | (1,100 | ) | (618 | ) | | (1,974 | ) | |||||||||||||||||
Amounts owed to subsidiary undertakings
|
(537 | ) | (341 | ) | | (250 | ) | (7,310 | ) | 8,438 | | |||||||||||||||||
Deferred tax liabilities
|
| (131 | ) | | (1,890 | ) | (1,305 | ) | 2 | (3,324 | ) | |||||||||||||||||
Pensions and other post-retirement benefit obligations
|
| (1,102 | ) | | | (1,996 | ) | | (3,098 | ) | ||||||||||||||||||
Provisions
|
| (215 | ) | | (108 | ) | (1,084 | ) | | (1,407 | ) | |||||||||||||||||
Total non-current liabilities
|
(6,275 | ) | (3,403 | ) | (197 | ) | (9,856 | ) | (21,492 | ) | 8,440 | (32,783 | ) | |||||||||||||||
Liabilities of businesses held for sale
|
| | | | | | | |||||||||||||||||||||
Total liabilities
|
(14,363 | ) | (4,028 | ) | (202 | ) | (11,926 | ) | (34,186 | ) | 25,363 | (39,342 | ) | |||||||||||||||
Net assets
|
4,199 | 1,260 | | 6,031 | 8,968 | (16,247 | ) | 4,211 | ||||||||||||||||||||
Equity
|
||||||||||||||||||||||||||||
Called up share capital
|
298 | 123 | | 45 | 183 | (351 | ) | 298 | ||||||||||||||||||||
Share premium account
|
1,366 | 1,942 | | 204 | 7,183 | (9,329 | ) | 1,366 | ||||||||||||||||||||
Retained earnings
|
7,316 | (808 | ) | | 4,493 | 1,821 | (5,506 | ) | 7,316 | |||||||||||||||||||
Other equity reserves
|
(4,781 | ) | 3 | | 1,289 | (231 | ) | (1,061 | ) | (4,781 | ) | |||||||||||||||||
Shareholders equity
|
4,199 | 1,260 | | 6,031 | 8,956 | (16,247 | ) | 4,199 | ||||||||||||||||||||
Non-controlling interests
|
| | | | 12 | | 12 | |||||||||||||||||||||
Total equity
|
4,199 | 1,260 | | 6,031 | 8,968 | (16,247 | ) | 4,211 | ||||||||||||||||||||
Parent | Subsidiary | |||||||||||||||||||||||||||
guarantor | Issuer of notes | guarantor | ||||||||||||||||||||||||||
Niagara | ||||||||||||||||||||||||||||
Mohawk | British | National | National | |||||||||||||||||||||||||
National | Power | Transco | Grid Gas | Other | Consolidation | Grid | ||||||||||||||||||||||
Grid plc | Corporation | Finance Inc. | plc | subsidiaries | adjustments | consolidated | ||||||||||||||||||||||
£m | £m | £m | £m | £m | £m | £m | ||||||||||||||||||||||
Year ended 31 March 2011
|
||||||||||||||||||||||||||||
Net cash provided by operating activities
|
55 | 742 | | 1,596 | 2,465 | | 4,858 | |||||||||||||||||||||
Net cash provided by/(used in) investing activities
|
2,127 | (377 | ) | | (909 | ) | (1,850 | ) | (3,765 | ) | (4,774 | ) | ||||||||||||||||
Net cash (used in)/provided by financing activities
|
(2,180 | ) | (365 | ) | | (621 | ) | (1,029 | ) | 3,765 | (430 | ) | ||||||||||||||||
Net increase/(decrease) in cash and cash equivalents
in the year
|
2 | | | 66 | (414 | ) | | (346 | ) | |||||||||||||||||||
Year ended 31 March 2010
|
||||||||||||||||||||||||||||
Net cash provided by operating activities
|
| 527 | | 1,449 | 2,540 | | 4,516 | |||||||||||||||||||||
Net cash provided by/(used in) investing activities
|
600 | (307 | ) | | (367 | ) | (1,451 | ) | (807 | ) | (2,332 | ) | ||||||||||||||||
Net cash (used in)/provided by financing activities
|
(637 | ) | (222 | ) | | (1,088 | ) | (1,072 | ) | 807 | (2,212 | ) | ||||||||||||||||
Net (decrease)/increase in cash and cash equivalents
in the year
|
(37 | ) | (2 | ) | | (6 | ) | 17 | | (28 | ) | |||||||||||||||||
Year ended 31 March 2009
|
||||||||||||||||||||||||||||
Net cash provided by operating activities
continuing operations
|
| 419 | | 1,277 | 1,725 | | 3,421 | |||||||||||||||||||||
Net cash used in operating activities
discontinued operations
|
| | | | (8 | ) | | (8 | ) | |||||||||||||||||||
Net cash provided by operating activities
|
| 419 | | 1,277 | 1,717 | | 3,413 | |||||||||||||||||||||
Net cash (used in)/provided by investing activities
continuing operations
|
(2,426 | ) | (265 | ) | | (1,569 | ) | (4,974 | ) | 6,187 | (3,047 | ) | ||||||||||||||||
Net cash (used in)/provided by investing activities
discontinued operations
|
| | | (6 | ) | 1,055 | | 1,049 | ||||||||||||||||||||
Net cash (used in)/provided by investing activities
|
(2,426 | ) | (265 | ) | | (1,575 | ) | (3,919 | ) | 6,187 | (1,998 | ) | ||||||||||||||||
Net cash provided by/(used in) financing activities
|
2,663 | (157 | ) | | 291 | 2,513 | (6,187 | ) | (877 | ) | ||||||||||||||||||
Net increase/(decrease) in cash and cash equivalents
in the year
|
237 | (3 | ) | | (7 | ) | 311 | | 538 | |||||||||||||||||||
2011 | 2010 | |||||||||||
Notes | £m | £m | ||||||||||
Fixed assets
|
||||||||||||
Investments
|
1 | 7,890 | 7,865 | |||||||||
Current assets
|
||||||||||||
Debtors (amounts falling due within one year)
|
2 | 9,988 | 8,655 | |||||||||
Debtors (amounts falling due after more than one year)
|
2 | 315 | 1,702 | |||||||||
Derivative financial instruments (amounts falling due within one year)
|
4 | 244 | 218 | |||||||||
Derivative financial instruments (amounts falling due after more than one year)
|
4 | 576 | 655 | |||||||||
Current asset investments
|
5 | 1,624 | 377 | |||||||||
Cash at bank
|
| 1 | ||||||||||
|
12,747 | 11,608 | ||||||||||
Creditors (amounts falling due within one year)
|
3 | (9,310 | ) | (8,088 | ) | |||||||
Net current assets
|
3,437 | 3,520 | ||||||||||
Total assets less current liabilities
|
11,327 | 11,385 | ||||||||||
Creditors (amounts falling due after more than one year)
|
||||||||||||
Borrowings
|
6 | (3,628 | ) | (5,307 | ) | |||||||
Derivative financial instruments
|
4 | (253 | ) | (431 | ) | |||||||
Amounts owed to subsidiary undertakings
|
| (537 | ) | |||||||||
|
(3,881 | ) | (6,275 | ) | ||||||||
Net assets
|
7,446 | 5,110 | ||||||||||
Capital and reserves
|
||||||||||||
Called up share capital
|
7 | 416 | 298 | |||||||||
Share premium account
|
8 | 1,361 | 1,366 | |||||||||
Cash flow hedge reserve
|
8 | 2 | 14 | |||||||||
Other equity reserves
|
8 | 196 | 171 | |||||||||
Profit and loss account
|
8 | 5,471 | 3,261 | |||||||||
Total shareholders funds
|
9 | 7,446 | 5,110 | |||||||||
Shares in | ||||
subsidiary | ||||
undertakings | ||||
£m | ||||
At 31 March 2009
|
7,840 | |||
Additions
|
25 | |||
At 31 March 2010
|
7,865 | |||
Additions
|
25 | |||
At 31 March 2011
|
7,890 | |||
2011 | 2010 | |||||||
£m | £m | |||||||
Amounts falling due within one year:
|
||||||||
Amounts owed by subsidiary undertakings
|
9,985 | 8,649 | ||||||
Prepayments and accrued income
|
3 | 6 | ||||||
|
9,988 | 8,655 | ||||||
Amounts falling due after more than one year:
|
||||||||
Amounts owed by subsidiary undertakings
|
311 | 1,700 | ||||||
Deferred taxation
|
4 | 2 | ||||||
|
315 | 1,702 | ||||||
Deferred | ||||
taxation | ||||
£m | ||||
At 31 March 2009
|
3 | |||
Charged to the profit and loss account
|
(1 | ) | ||
At 31 March 2010
|
2 | |||
Charged to the profit and loss account
|
(2 | ) | ||
Credited to equity
|
4 | |||
At 31 March 2011
|
4 | |||
2011 | 2010 | |||||||
£m | £m | |||||||
Borrowings (note 6)
|
1,125 | 1,183 | ||||||
Derivative financial instruments (note 4)
|
194 | 174 | ||||||
Amounts owed to subsidiary undertakings
|
7,957 | 6,701 | ||||||
Other creditors
|
34 | 30 | ||||||
|
9,310 | 8,088 | ||||||
2011 | 2010 | |||||||||||||||||||||||
Assets | Liabilities | Total | Assets | Liabilities | Total | |||||||||||||||||||
£m | £m | £m | £m | £m | £m | |||||||||||||||||||
Amounts falling due within one year
|
244 | (194 | ) | 50 | 218 | (174 | ) | 44 | ||||||||||||||||
Amounts falling due after more than one year
|
576 | (253 | ) | 323 | 655 | (431 | ) | 224 | ||||||||||||||||
|
820 | (447 | ) | 373 | 873 | (605 | ) | 268 | ||||||||||||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Interest rate swaps
|
(9,328 | ) | (7,337 | ) | ||||
Cross-currency interest rate swaps
|
(4,886 | ) | (6,463 | ) | ||||
Foreign exchange forward contracts
|
(9,334 | ) | (7,234 | ) | ||||
Forward rate agreements
|
(10,670 | ) | (7,784 | ) | ||||
Total
|
(34,218 | ) | (28,818 | ) | ||||
2011 | 2010 | |||||||
£m | £m | |||||||
Investments in short-term money funds
|
1,375 | 162 | ||||||
Short-term deposits
|
200 | 197 | ||||||
Restricted cash balances collateral
|
49 | 18 | ||||||
|
1,624 | 377 | ||||||
2011 | 2010 | |||||||
£m | £m | |||||||
Amounts falling due within one year:
|
||||||||
Bank loans
|
172 | 299 | ||||||
Commercial paper
|
| 121 | ||||||
Bonds
|
953 | 763 | ||||||
|
1,125 | 1,183 | ||||||
Amounts falling due after more than one year:
|
||||||||
Bank loans
|
133 | 398 | ||||||
Bonds
|
3,495 | 4,909 | ||||||
|
3,628 | 5,307 | ||||||
Total borrowings
|
4,753 | 6,490 | ||||||
Allotted, called up | ||||||||
and fully paid | ||||||||
Ordinary shares | millions | £m | ||||||
At 31 March 2009
|
2,582 | 294 | ||||||
Issued during the year in lieu of dividends (i)
|
35 | 4 | ||||||
At 31 March 2010
|
2,617 | 298 | ||||||
Rights issue
|
990 | 113 | ||||||
Issued during the year in lieu of dividends (i)
|
41 | 5 | ||||||
At 31 March 2011
|
3,648 | 416 | ||||||
(i) | The issue of shares in lieu of cash dividends is considered to be a bonus issue under the terms of the Companies Act 2006 and the nominal value of the shares is charged to the share premium account. |
Share | Cash flow | |||||||||||||||
premium | hedge | Other equity | Profit and | |||||||||||||
account | reserve | reserves | loss account | |||||||||||||
£m | £m | £m | £m | |||||||||||||
At 31 March 2009
|
1,371 | 12 | 146 | 3,603 | ||||||||||||
Transferred from equity in respect of cash flow hedges (net of tax)
|
| 2 | | | ||||||||||||
Shares issued in lieu of dividends
|
(5 | ) | | | | |||||||||||
Purchase of own shares
|
| | | (7 | ) | |||||||||||
Issue of treasury shares
|
| | | 18 | ||||||||||||
Share awards to employees of subsidiary undertakings
|
| | 25 | | ||||||||||||
Loss for the year
|
| | | (353 | ) | |||||||||||
At 31 March 2010
|
1,366 | 14 | 171 | 3,261 | ||||||||||||
Transferred from equity in respect of cash flow hedges (net of tax)
|
| (12 | ) | | | |||||||||||
Merger reserve created on rights issue
|
| | 3,101 | | ||||||||||||
Transfer to distributable reserves
|
| | (3,101 | ) | 3,101 | |||||||||||
Shares issued in lieu of dividends
|
(5 | ) | | | | |||||||||||
Purchase of own shares
|
| | | (3 | ) | |||||||||||
Issue of treasury shares
|
| | | 18 | ||||||||||||
Share awards to employees of subsidiary undertakings
|
| | 25 | | ||||||||||||
Loss for the year
|
| | | (906 | ) | |||||||||||
At 31 March 2011
|
1,361 | 2 | 196 | 5,471 | ||||||||||||
2011 | 2010 | |||||||
£m | £m | |||||||
(Loss)/profit for the year after taxation
|
(48 | ) | 335 | |||||
Dividends (i)
|
(858 | ) | (688 | ) | ||||
Loss for the financial year
|
(906 | ) | (353 | ) | ||||
Expenses charged to share premium account
|
| (1 | ) | |||||
Proceeds of issue of treasury shares
|
18 | 18 | ||||||
Movement on cash flow hedge reserve (net of tax)
|
(12 | ) | 2 | |||||
Share awards to employees of subsidiary undertakings
|
25 | 25 | ||||||
Purchase of own shares
|
(3 | ) | (7 | ) | ||||
Rights issue
|
3,214 | | ||||||
Net increase/(decrease) in shareholders funds
|
2,336 | (316 | ) | |||||
Opening shareholders funds
|
5,110 | 5,426 | ||||||
Closing shareholders funds
|
7,446 | 5,110 | ||||||
(i) | For further details of dividends paid and payable to shareholders, refer to note 7 in the consolidated financial statements. |
31 March | 31 March | 31 March | 31 March | 31 March | ||||||||||||||||
2011 | 2010 | 2009 | 2008 | 2007 | ||||||||||||||||
£m | £m | £m | £m | £m | ||||||||||||||||
Summary income statement
|
||||||||||||||||||||
Revenue*
|
14,343 | 14,007 | 15,687 | 11,498 | 8,778 | |||||||||||||||
Operating profit
|
||||||||||||||||||||
Before exceptional items, remeasurements and stranded cost recoveries
|
3,600 | 3,121 | 2,915 | 2,595 | 2,031 | |||||||||||||||
Exceptional items, remeasurements and stranded cost recoveries
|
145 | 172 | (292 | ) | 369 | 482 | ||||||||||||||
|
3,745 | 3,293 | 2,623 | 2,964 | 2,513 | |||||||||||||||
|
||||||||||||||||||||
Profit before tax
|
||||||||||||||||||||
Before exceptional items, remeasurements and stranded cost recoveries
|
2,473 | 1,974 | 1,770 | 1,829 | 1,486 | |||||||||||||||
Exceptional items, remeasurements and stranded cost recoveries
|
151 | 219 | (376 | ) | 353 | 265 | ||||||||||||||
|
2,624 | 2,193 | 1,394 | 2,182 | 1,751 | |||||||||||||||
|
||||||||||||||||||||
Profit for the year attributable to equity shareholders
|
||||||||||||||||||||
Before exceptional items, remeasurements and stranded cost recoveries
|
1,747 | 1,418 | 1,259 | 1,275 | 1,146 | |||||||||||||||
Exceptional items, remeasurements and stranded cost recoveries
|
412 | (32 | ) | (315 | ) | 1,915 | 248 | |||||||||||||
|
2,159 | 1,386 | 944 | 3,190 | 1,394 | |||||||||||||||
Summary statement of net assets
|
||||||||||||||||||||
Non-current assets
|
39,787 | 38,488 | 37,712 | 30,830 | 21,109 | |||||||||||||||
Current assets
|
6,323 | 5,065 | 6,755 | 5,435 | 5,312 | |||||||||||||||
Assets of businesses held for sale
|
290 | | | 1,506 | 1,968 | |||||||||||||||
Total assets
|
46,400 | 43,553 | 44,467 | 37,771 | 28,389 | |||||||||||||||
Current liabilities
|
(6,826 | ) | (6,559 | ) | (7,026 | ) | (7,146 | ) | (3,360 | ) | ||||||||||
Non-current liabilities
|
(30,395 | ) | (32,783 | ) | (33,457 | ) | (25,188 | ) | (20,443 | ) | ||||||||||
Liabilities of businesses held for sale
|
(110 | ) | | | (63 | ) | (450 | ) | ||||||||||||
Total liabilities
|
(37,331 | ) | (39,342 | ) | (40,483 | ) | (32,397 | ) | (24,253 | ) | ||||||||||
Net assets
|
9,069 | 4,211 | 3,984 | 5,374 | 4,136 | |||||||||||||||
Summary cash flow statement
|
||||||||||||||||||||
Cash generated from operations
|
||||||||||||||||||||
Continuing operations
|
4,854 | 4,372 | 3,564 | 3,265 | 3,090 | |||||||||||||||
Discontinued operations
|
| | (8 | ) | 10 | 181 | ||||||||||||||
|
4,854 | 4,372 | 3,556 | 3,275 | 3,271 | |||||||||||||||
Tax received/(paid)
|
4 | 144 | (143 | ) | (110 | ) | (313 | ) | ||||||||||||
Net cash inflow from operating activities
|
4,858 | 4,516 | 3,413 | 3,165 | 2,958 | |||||||||||||||
Net cash flows used in investing activities
|
(4,774 | ) | (2,332 | ) | (1,998 | ) | (3,023 | ) | (4,061 | ) | ||||||||||
Net cash flows (used in)/from financing activities
|
(430 | ) | (2,212 | ) | (877 | ) | (1,592 | ) | 1,278 | |||||||||||
Net (decrease)/increase in cash and cash equivalents
|
(346 | ) | (28 | ) | 538 | (1,450 | ) | 175 | ||||||||||||
1 June 2011
|
Ordinary shares go ex-dividend for 2010/11 | |
3 June 2011
|
Record date for 2010/11 final dividend | |
8 June 2011
|
Scrip reference price announced | |
20 July 2011
|
Scrip election date | |
|
2011 Annual General Meeting and | |
25 July 2011
|
interim management statement | |
|
2010/11 final dividend paid to qualifying | |
17 August 2011
|
ordinary shareholders | |
17 November 2011
|
2011/12 half year results | |
30 November 2011
|
Ordinary shares go ex-dividend | |
2 December 2011
|
Record date for 2011/12 interim dividend | |
|
2011/12 interim dividend paid to qualifying | |
18 January 2012
|
ordinary shareholders | |
January/February 2012
|
Interim management statement | |
May 2012
|
2011/12 preliminary results | |
1986
|
British Gas incorporated as a public limited company | |
1990
|
Electricity transmission network in England and Wales | |
|
transferred to National Grid on electricity privatisation | |
1995
|
National Grid listed on the London Stock Exchange | |
1997
|
Centrica demerged from British Gas (BG) | |
1997
|
Energis demerged from National Grid | |
2000
|
Lattice Group demerged from BG and listed separately | |
2000
|
New England Electric System and Eastern Utilities Associates acquired | |
2002
|
Niagara Mohawk Power Corporation merged with National Grid
in US |
|
2002
|
National Grid and Lattice Group merged to form National Grid Transco | |
2004
|
UK wireless infrastructure network acquired from Crown Castle
International Corp |
|
2005
|
Four UK regional gas distribution networks sold and National Grid adopted as our name | |
2006
|
Rhode Island gas distribution network acquired | |
2007
|
UK and US wireless infrastructure operations and the Basslink electricity interconnector in Australia sold | |
2007
|
KeySpan Corporation acquired | |
2008
|
Ravenswood generation station sold | |
2010
|
Rights issue raised £3.2 billion | |
/s/ PricewaterhouseCoopers LLP
|
||
London, UK
|
||
13 June 2011
|