Trust Deed, dated as of May 24, 2019, among Northern Electric Finance plc, as issuer, Northern Powergrid (Northeast) Limited, as Guarantor, and HSBC Corporate Trustee Company (UK) Limited, as Trustee, relating to the 150,000,000 in aggregate principal amount of 2.75% Guaranteed Bonds due 2049

NORTHERN ELECTRIC FINANCE PLC (the "Issuer"), a public company incorporated in England and Wales with limited liability under registered number 03070482;

NORTHERN POWERGRID (NORTHEAST) LIMITED (the "Guarantor"), a public company incorporated in England and Wales with limited liability under registered number 02906593; and

HSBC CORPORATE TRUSTEE COMPANY (UK) LIMITED (the "Trustee", which expression shall, where the content so admits, include all persons for the time being the trustee or trustees of this Trust Deed (as defined below)).

The Issuer has authorised the issue of £150,000,000 in aggregate principal amount of 2.750 per cent. Guaranteed Bonds due 2049 to be constituted by this Trust Deed.

The Guarantor has authorised the giving of its guarantee in relation to these Bonds.

The Trustee has agreed to act as trustee of this Trust Deed on the following terms and conditions.

in relation to the Issuer, a director of the Issuer or any person in respect of whom the Issuer has supplied to the Trustee a copy, certified by a director or the secretary of the Issuer, to be a true copy and in full force and effect, of a resolution or resolutions of the board of directors (or a committee of the board of directors) of the Issuer, authorising such person to sign on behalf of the Issuer all such certificates and other documents as are referred to therein, together with a certified specimen signature of such person, and in respect of whom the Trustee has not received written notification from the Issuer, that such person has ceased to be so authorised; and

in relation to the Guarantor, a director of the Guarantor or any person in respect of whom the Guarantor has supplied to the Trustee a copy, certified by a director or the secretary of the Guarantor, to be a true copy and in full force and effect, of a resolution or resolutions of the board of directors (or a committee of the board of directors) of the Guarantor, authorising such person to sign on behalf of the Guarantor all such certificates and other documents as are referred to therein, together with a certified specimen signature of such person, and in respect of whom the Trustee has not received written notification from the Guarantor, that such person has ceased to be so authorised;

the right to attend and vote at any meeting of the Bondholders;

the determination of how many and which Bonds are for the time being outstanding for the purposes of the Conditions and Schedule 5 (Provisions for Meetings of Bondholders);

any discretion, power or authority contained in this Trust Deed which the Trustee is required, expressly or impliedly, to exercise in or by reference to the interests of any of the Bondholders; and

the determination by the Trustee whether any of the events specified in Condition 10 (Events of Default) is materially prejudicial to the interests of the Bondholders,

costs, charges, remuneration or expenses shall include any value added tax, turnover tax or similar tax charged in respect thereof;

"£", "pounds" and "Sterling" shall be construed as references to the lawful currency for the time being of the United Kingdom;

any action, remedy or method of judicial proceedings for the enforcement of rights of creditors shall include, in respect of any jurisdiction other than England, references to such action, remedy or method of judicial proceedings available or appropriate in such jurisdiction as shall most nearly approximate thereto;

all references in this Trust Deed or the Conditions involving compliance by the Trustee with a test of reasonableness shall be deemed to include a reference to a requirement that such reasonableness shall be determined by reference primarily to the interests of the holders of the Bonds as a class and in the event of any conflict between such interests and the interests of any other person, the former shall prevail as being paramount;

in this Trust Deed references to Coupons and Couponholders shall apply only if Definitive Bonds have been issued by the Issuer in accordance with Clause 3 (Form and Issue of the Bonds); and

any provision of any statute shall be deemed also to refer to any statutory modification or re-enactment thereof or any statutory instrument, order or regulation made thereunder or under such modification or re-enactment.

by notice in writing to the Issuer, the Guarantor and the Paying Agents (or such of them as are specified by the Trustee), require the Paying Agents (or such of them as are specified by the Trustee):

to act thereafter, until otherwise instructed by the Trustee, as agents of the Trustee under this Trust Deed and the Bonds on the terms of the Paying Agency Agreement (with consequential amendments as necessary and save that the Trustee's liability for the indemnification, remuneration and all other out-of-pocket expenses of any of the Paying Agents shall be limited to the amounts for the time being held by the Trustee on the trusts of this Trust Deed and available to the Trustee for such purpose) and thereafter to hold all Definitive Bonds and Coupons and all sums, documents and records held by them in respect of the Bonds and Coupons to the order of the Trustee; and/or

to deliver all Definitive Bonds and Coupons and all sums, documents and records held by them in respect of the Bonds and Coupons (save for such documents and records which the Paying Agents are obliged not to release by virtue of any applicable law or regulation or by order of any court of competent jurisdiction) to the Trustee or as the Trustee directs in such notice; and

by notice in writing to the Issuer and the Guarantor require each of them to make all subsequent payments in respect of the Bonds, the Coupons and the Guarantee (as applicable) to or to the order of the Trustee and not to the Principal Paying Agent.

The Issuer shall be at liberty from time to time (but subject always to the provisions of this Trust Deed) without the consent of the Bondholders or Couponholders to create and issue Further Bonds (whether in bearer or registered form) ranking pari passu in all respects (or in all respects save for the first payment of interest thereon), and so that the same shall be consolidated and form a single series, with the original Bonds and/or any Further Bonds of any series, provided that:

the Trustee is satisfied (by means of a confirmation from S&P in the case of any rating by S&P and Fitch in the case of any rating by Fitch) that

the Issuer shall not create and issue such Further Bonds while any default exists in relation to any payment by the Issuer of any amounts due under this Trust Deed.

Any Further Bonds which are to be created and issued pursuant to the provisions of sub-clause 2.5.1 above shall be constituted by a deed supplemental to this Trust Deed in such form as the Trustee may approve. In such case the Issuer and the Guarantor shall, prior to the issue of such Further Bonds, execute and deliver to the Trustee a deed supplemental to this Trust Deed (in relation to which all applicable stamp duties or other documentation fees, duties or taxes have been paid and, if applicable, duly stamped or denoted accordingly) and containing a covenant by the Issuer in the form mutatis mutandis of Clause 2.2 (Covenant to pay) in relation to the principal, premium (if any) and interest in respect of such Further Bonds and such other provisions (corresponding to the provisions contained in this Trust Deed) as the Trustee shall require.

A memorandum of every such supplemental Trust Deed shall be endorsed by the Trustee on this Trust Deed and by the Issuer and the Guarantor on their duplicates of this Trust Deed.

Whenever it is proposed to create and issue any Further Bonds the Issuer shall give to the Trustee not less than 14 days' notice in writing of its intention so to do stating the amount of Further Bonds proposed to be created and issued.

The Issuer and the Guarantor shall, within ten business days of a written request by the Trustee, supply to the Trustee such forms, documentation and other information relating to the Issuer or the Guarantor, their operations, or the Bonds as the Trustee reasonably requests for the purposes of the Trustee's compliance with applicable law and shall notify the Trustee reasonably promptly in the event that the Issuer or the Guarantor becomes aware that any of the forms, documentation or other information provided by the Issuer or the Guarantor is (or becomes) inaccurate in any material respect; provided, however, the Issuer and the Guarantor shall not be required to provide any forms, documentation or other information pursuant to this Clause 5.3 to the extent that: (i) any such form, documentation or other information (or the information required to be provided on such form or documentation) is not reasonably available to the Issuer or the Guarantor and cannot be obtained by the Issuer or the Guarantor using reasonable efforts; or (ii) doing so would or might in the reasonable opinion of the Issuer or the Guarantor constitute a breach of any: (a) applicable law; (b) fiduciary duty; or (c) duty of confidentiality.

Notwithstanding any other provision of this Trust Deed, the Trustee shall be entitled to make a deduction or withholding from any payment which it makes under the Bonds for or on account of any tax, if and only to the extent so required by applicable law, in which event the Trustee shall make such payment after such deduction or withholding has been made and shall account to the relevant authority within the time allowed for the amount so deducted or withheld or, at its option, shall reasonably promptly after making such payment return to the Issuer or the Guarantor the amount so deducted or withheld, in which case, the Issuer or the Guarantor shall so account to the relevant authority for such amount. The Trustee shall have no obligation to gross-up any payment hereunder or to pay any additional amount as a result of such withholding or deduction.

firstly, in payment of all costs, charges, expenses and liabilities incurred by the Trustee in carrying out the preparation and execution of the trusts of this Trust Deed (including remuneration payable to the Trustee);

secondly, in payment of any interest owing in respect of the Bonds pari passu and rateably;

thirdly, in payment of any principal and premium (if any) owing in respect of the Bonds pari passu and rateably, and

fourthly, in payment to the Issuer or, if such moneys were received from the Guarantor, the Guarantor.

specifying the aggregate amount of any Relevant Indebtedness of the Issuer or, as the case may be, the Guarantor or guaranteed by the Issuer or, as the case may be, the Guarantor or any of their respective Subsidiaries in respect of which a Security Interest or Security Interests has or have been created or is or are outstanding, such certificate to be provided before the Issuer, the Guarantor or such Subsidiary creates or has outstanding any new Security Interest in respect of Relevant Indebtedness;

specifying details of:

any revocation or surrender or any modification to the terms and conditions of the Guarantor's Electricity Distribution Licence which is requisite to the conduct of the Guarantor's business at the relevant time; and

any legislation enacted which removes, qualifies or amends (other than an amendment which is of a formal, minor or technical nature) the duties of the Secretary of State (or any successor) and/or OFGEM under the Electricity Act as in force on the Issue Date; and

at the request of the Trustee confirming any of the matters set out in Condition 10 (Events of Default).

in the case of payments made by the Trustee prior to such demand will carry interest from the date on which the demand is made at the rate of 2 per cent. per annum over the base rate of HSBC Bank plc on the date on which such payments were made by the Trustee; and

in all other cases will carry interest at such rate from 30 days after the date on which the demand is made or (where the demand specifies that payment is to be made on an earlier date) from such earlier date.

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.

Nothing contained in the Trust Deed or the Paying Agency Agreement or the Bonds shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of its duties or the exercise of any right, power, authority or discretion hereunder if it has grounds for believing the repayment of such funds or adequate indemnity against, or security for, such risk or liability is not reasonably assured to it.

Notwithstanding anything else contained in the Trust Deed or the Paying Agency Agreement or the Bonds, the Trustee may refrain from (a) doing anything which would or might in its opinion be illegal or contrary to any law of any jurisdiction or any directive or regulation of any agency of any state (including, without limitation, Section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act), or which would or might otherwise render it liable to any person and may do anything which is, in its opinion, necessary to comply with any such law, directive or regulation or (b) doing anything which may cause the Trustee to be considered a sponsor of a covered fund under Section 619 of the Dodd-

In relation to any discretion to be exercised or action to be taken by the Trustee under the Trust Deed or the Paying Agency Agreement or the Bonds, the Trustee may, at its discretion and without further notice or shall, if it has been so directed by an Extraordinary Resolution of the Bondholders then outstanding or so requested in writing by the holders of at least 25 per cent. in principal amount of such Bonds, exercise such discretion or take such action, provided that, in either case, the Trustee shall not be obliged to exercise such discretion or take such action unless it shall have been indemnified, secured and/or prefunded to its satisfaction against all liabilities and provided that the Trustee shall not be held liable to the Bondholders for the consequences of exercising its discretion or taking any such action and may do so without having regard to the effect of such action on individual Bondholders or Couponholders.

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 Bonds or the Paying Agency Agreement save in relation to its own gross negligence, wilful default, or fraud; and

nothing in this Trust Deed, the Bonds or the Paying Agency Agreement shall relieve the Trustee of any liability which would otherwise attach to it in respect of its own gross negligence, wilful default, or fraud,

The Trustee may, without the consent of the Bondholders or Couponholders, agree with the Issuer and the Guarantor to the substitution of the Guarantor or of any wholly-owned Subsidiary of the Issuer or the Guarantor (the "Substituted Obligor") in place of the Issuer (or of any previous substitute under this sub-clause 15.2.1) as the principal debtor under this Trust Deed, the Bonds and the Coupons provided that, in the opinion of the Trustee, the interests of the Bondholders will not be materially prejudiced thereby and also provided that:

a trust deed is executed or some other form of undertaking is given by the Substituted Obligor to the Trustee, in form and manner satisfactory to the Trustee, agreeing to be bound by the terms of this Trust Deed, the Bonds and the Coupons with any consequential amendments which the Trustee may deem appropriate as fully as if the Substituted Obligor had been named in this Trust Deed and on the Bonds and Coupons as the principal debtor in place of the Issuer (or any previous substitute under this Clause);

the Issuer, the Guarantor and the Substituted Obligor execute such other deeds, documents and instruments (if any) as the Trustee may require in order that the substitution is fully effective and (unless the Substituted Obligor is the Guarantor) the guarantee contained in Clause 4 (Guarantee and Indemnity) is fully effective in relation to the obligations of the Substituted Obligor and comply with such other requirements as the Trustee may direct in the interests of the Bondholders;

the Trustee is satisfied that (i) the Substituted Obligor has obtained all governmental and regulatory approvals and consents necessary for its assumption of liability as principal debtor in respect of the Bonds and the Coupons in place of the Issuer (or such previous substitute as aforesaid), (ii) the Guarantor has obtained all governmental and regulatory approvals and consents necessary for the guarantee to be fully effective and (iii) such approvals and consents are at the time of substitution in full force and effect;

where the Substituted Obligor is subject generally to the taxing jurisdiction of any territory or any authority of or in that territory having 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) the Issuer is subject generally (the "Issuer's Territory") the Substituted Obligor will (unless the Trustee otherwise agrees) give to the Trustee an undertaking in form and manner satisfactory to the Trustee in terms corresponding to the terms of Condition 8 (Taxation) with the substitution for the references in that Condition to the Issuer's Territory of references to the Substituted Territory and Condition 7(c) (Redemption for tax reasons) shall be modified accordingly; and in such event the Trust Deed, the Bonds and the Coupons will be read accordingly; and

if any two of the directors of the Substituted Obligor certify that it will be solvent immediately after such substitution, the Trustee need not have regard to the financial condition, profits or prospects of the Substituted Obligor or compare them with those of the Issuer.

Release of Substituted Issuer: Any such agreement by the Trustee pursuant to this Clause 15.2 will, if so expressed, operate to release the Issuer (or any such previous substitute) from any or all of its obligations under this Trust Deed, the Bonds and the Coupons. Not later than 14 days after the execution of any such documents and after compliance with such requirements, notice of the substitution will be given to the Bondholders.

Completion of Substitution: Upon the execution of such documents and compliance with such requirements, the Substituted Obligor will be deemed to be named in this Trust Deed and on the Bonds and Coupons as the principal debtor in place of the Issuer (or of any previous substitute under this Clause 15.2) and this Trust Deed, the Bonds, the Coupons and the Paying Agency Agreement will be deemed to be modified in such manner as shall be necessary to give effect to the substitution and without prejudice to the generality of the foregoing any references in this Trust Deed, the Bonds, the Coupons or the Paying Agency Agreement to the Issuer shall be deemed to be references to the Substituted Obligor.

if the Trustee considers such appointment to be in the interests of the Bondholders and/or the Couponholders;

for the purpose of conforming with any legal requirement, restriction or condition in any jurisdiction in which any particular act is to be performed; or

for the purpose of obtaining a judgment in any jurisdiction or the enforcement in any jurisdiction against the Issuer of either a judgment already obtained or any of the provisions of this Trust Deed.

In connection with HSBC Group's commitment to comply with all applicable sanctions regimes, the Trustee and any affiliate or subsidiary of HSBC Holdings plc may take any action in its sole and absolute discretion that it considers appropriate to comply with any law, regulation, request of a public or regulatory authority, any agreement between any member of the HSBC Group and any government authority or any HSBC Group policy that relates to the prevention of fraud, money laundering, terrorism, tax evasion, evasion of economic or trade sanctions or other criminal activities (collectively the "Relevant Requirements").

screening, intercepting and investigating any transaction, instruction or communication, including the source of, or intended recipient of, funds;

delaying or preventing the processing of instructions or transactions or the Trustee's performance of its obligations under this Deed;

the blocking of any payment; or

requiring the Issuer to enter into a financial crime compliance representations letter from time to time in a form and substance reasonably acceptable to the HSBC Group.

Where possible and permitted, the Trustee will endeavour to notify the Issuer of the existence of such circumstances. To the extent permissible by law, neither the Trustee

in the case of interest falling due before the Exchange Date (as defined below), to the extent that a certificate or certificates issued by Euroclear Bank S.A./N.V. as operator of the Euroclear System ("Euroclear") and/or Clearstream Banking, S.A. ("Clearstream, Luxembourg") dated not earlier than the date on which such interest falls due and in substantially the form set out in Schedule 3 (Form of Euroclear/Clearstream, Luxembourg Certification) hereto is/are delivered to the Specified Office (as defined in the Conditions) of the Principal Paying Agent; or

in the case of interest falling due at any time, to the extent that the Issuer has failed to procure the exchange for a permanent global bond of that portion of this Temporary Global Bond in respect of which such interest has accrued.

presentation and (in the case of final exchange) surrender of this Temporary Global Bond at the specified office of the Principal Paying Agent; and

receipt by the Principal Paying Agent of a certificate or certificates issued by Euroclear and/or Clearstream, Luxembourg dated not earlier than the Exchange Date and in

the Permanent Global Bond is delivered, or the principal amount thereof is increased in accordance with its terms in exchange for a further portion of this Temporary Global Bond; or

Bonds represented by this Temporary Global Bond are to be cancelled in accordance with Condition 7(e) (Redemption and Purchase - Cancellation),

a payment of principal is made in respect of this Global Bond;

Definitive Bonds are delivered; or

Bonds represented by this Global Bond are to be cancelled in accordance with Condition 7(e) (Redemption and Purchase - Cancellation),

Status of the Bonds: The Bonds and Coupons constitute direct, unconditional and (subject to the provisions of Condition 4(a) (Negative Pledge)) unsecured obligations of the Issuer and rank pari passu and without any preference among themselves. The payment obligations of the Issuer under the Bonds and the Coupons shall, subject as aforesaid and save for such obligations as may be preferred by laws that are both mandatory and of general application, at all times rank at least equally with all its present and future unsecured and unsubordinated obligations.

Guarantee of the Bonds: The Guarantor has in the Trust Deed unconditionally and irrevocably guaranteed the due and punctual payment of all sums from time to time payable by the Issuer in respect of the Bonds. This guarantee (the "Guarantee") constitutes a direct, unconditional and (subject to the provisions of Condition 4 (Negative Pledge)) unsecured obligation of the Guarantor. The payment obligations of the Guarantor under the Guarantee shall, subject as aforesaid and save for certain obligations required to be preferred by laws that are both mandatory and of general application, at all times rank at least equally with all its present and future unsecured and unsubordinated obligations.

(a) written notice being given to the Guarantor of revocation of its Electricity Distribution Licence which is requisite to the conduct of the Guarantor's business at the relevant time or (b) the Guarantor agreeing in writing to any revocation or surrender of its Electricity Distribution Licence which is requisite to the conduct of the Guarantor's business at the relevant time or (c) any legislation (whether primary or subordinate) being enacted terminating or revoking its Electricity Distribution Licence which is requisite to the conduct of the Guarantor's business at the relevant time, except in any such case in circumstances where a licence or licences is or are granted to the Guarantor or a Subsidiary of the Guarantor 100 per cent of the ordinary share capital of which is owned directly or indirectly by the Guarantor (the "Relevant Transferee") and provided that the terms of such licence or licences are substantially no less favourable than the Electricity Distribution Licence in which event all references in these Terms and Conditions to the Electricity Distribution Licence and the Guarantor in its capacity as holder of the Electricity Distribution Licence shall hereafter be deemed to be references to the licence or licences on substantially no less favourable terms and the Relevant Transferee respectively; or

any modification (other than a modification which is of a formal, minor or technical nature) being made to the terms and conditions of the Electricity Distribution Licence on or after the Issue Date unless two Directors of the Guarantor have certified in good faith to the Trustee (and the Trustee may rely

any legislation (whether primary or subordinate) is enacted which removes, qualifies or amends (other than an amendment which is of a formal, minor or technical nature) the duties of the Secretary of State (or any successor) and/or Ofgem under the Electricity Act as in force on the Issue Date, unless two Directors of the Guarantor have certified in good faith to the Trustee (and the Trustee may rely absolutely on such certification) that such removal, qualification or amendment does not have a materially adverse effect on the financial condition of the Guarantor.

if at the time a Restructuring Event occurs there are Reference Rated Securities, the period of 90 days starting from and including the day on which the Restructuring Event occurs; or

if at the time a Restructuring Event occurs there are not Reference Rated Securities, the period starting from and including the day on which the Restructuring Event occurs and ending on the day 90 days following the later of (a) the date on which the Issuer shall seek to obtain a rating pursuant to the definition of Negative Rating Event prior to the expiry of the 14 days referred to in the definition of Negative Rating Event and (b) the date on which a Negative Certification shall have been given to the Issuer in respect of the Restructuring Event.

all amounts payable by the Issuer under the Bonds, the Coupons and the Trust Deed or, as the case may be, all amounts payable by the Guarantor under the Guarantee and the Trust Deed are secured to the satisfaction of the Trustee equally and rateably with the Relevant Indebtedness or guarantee of Relevant Indebtedness, as the case may be, by such Security Interest; or

such other Security Interest or guarantee or other arrangement (whether or not including the giving of a Security Interest) is provided in respect of all amounts payable by the Issuer under the Bonds, the Coupons and the Trust Deed or, as the case may be, all amounts payable by the Guarantor under the Guarantee and the Trust Deed either (i) as the Trustee shall in its absolute discretion deem not materially less beneficial to the interests of the Bondholders, or (ii) as shall be approved by an Extraordinary Resolution (as defined in the Trust Deed) of the Bondholders.

Scheduled redemption: Unless previously redeemed, or purchased and cancelled, the Issuer will redeem the Bonds on 24 May 2049 (the "Maturity Date") at their outstanding principal amount.

Redemption at the option of the Issuer: The Issuer may, having given not less than 30 nor more than 45 days' notice in accordance with Condition 14 (Notices) (which notice shall be irrevocable), redeem the whole or part (in principal amount of £5,000,000 or integral multiples thereof) of the Bonds at any time prior to the Maturity Date at a price equal to the Redemption Price together with interest accrued up to and including the date of redemption.

in relation to any date fixed for redemption which falls in the period up to and including the date falling three months prior to the Maturity Date, the higher of the following:

that price, expressed as a percentage (rounded to three decimal places, 0.0005 being rounded upwards), at which the Gross Real Redemption Yield (calculated as described below) on the Bonds, if they were to be purchased at such price on the third dealing day prior to the publication of the notice of redemption, would be equal to the Gross Real Redemption Yield on such dealing day of the Reference Gilt, on the basis of the middle market price of the Reference Gilt prevailing at 11:00 a.m. on such dealing day, as determined by NatWest Markets Plc (or such other investment bank of international repute as the Trustee may approve); and

in relation to any date fixed for redemption which falls in the period from but excluding the date falling three months prior to the Maturity Date to but excluding the Maturity Date, par.

Redemption for tax reasons: If, as a result of any change in, or amendment to, the laws or regulations of the United Kingdom or any political sub-division of, or any authority in, or of, the United Kingdom having power to tax, or any change in the application or official interpretation of such laws or regulations, which change or amendment becomes effective after 22 May 2019, the Issuer or the Guarantor (if a demand were made under the Guarantee) has or will become obliged to pay additional amounts as provided or referred to in Condition 8 (Taxation) (and such amendment or change has been evidenced by the delivery by the Issuer or, as applicable, the Guarantor to the Trustee (who shall accept such certificate as sufficient evidence thereof) of a certificate signed by two Directors of the Issuer or, as applicable, the Guarantor stating that such amendment or change has occurred (irrespective of whether such amendment or change is then effective), describing the facts leading thereto and stating that such obligation cannot be avoided by the Issuer or, as applicable, the Guarantor taking reasonable measures available to it) the Issuer may at its option, having given not less than 30 nor more than 60 days' notice to the Bondholders in accordance with Condition 14 (Notices) (which notice shall be irrevocable), redeem all the Bonds (other than Bonds in respect of which the Issuer shall have given a notice of redemption pursuant to Condition 7(b) (Redemption at the option of the Issuer) prior to any notice being given under this Condition 7(c)), but not some only, at their outstanding principal amount together with interest accrued to (but excluding) the date of redemption, provided that no notice of redemption shall be given earlier than 90 days before the earliest date on which the Issuer or the Guarantor would be required to pay the additional amounts were a payment in respect of the Bonds (or, as the case may be, the Guarantee) then due and provided further that no notice of redemption may be given by the Issuer unless two Directors of the Issuer shall have certified to the Trustee that it will have the funds, not subject to the interest of any other person, required to redeem the Bonds at their principal amounts outstanding plus accrued interest on the date specified for redemption (the Trustee being able to rely on such certificate absolutely).

Purchase: The Issuer, the Guarantor or any of their respective Subsidiaries may at any time purchase or otherwise acquire Bonds (provided that all unmatured Coupons are attached thereto or are surrendered therewith) at any price in the open market or otherwise.

Cancellation: All Bonds which are redeemed pursuant to this Condition by the Issuer shall be cancelled (together with all relative unmatured Coupons attached thereto or surrendered therewith) and accordingly may not be reissued or resold. Bonds purchased by or on behalf of the Issuer, the Guarantor or any of their respective Subsidiaries may be held or reissued or resold or surrendered for cancellation.

All payments in respect of the Bonds and Coupons by or on behalf of the Issuer or the Guarantor shall be made without withholding or deduction for, or on account of, any present or future taxes, duties, assessments or governmental charges of whatever nature ("Taxes") imposed or levied by or on behalf of the United Kingdom, or any political subdivision of, or authority in, or of, the United Kingdom having power to tax, unless the withholding or deduction of the Taxes is required by law. In that event, the Issuer or (as the case may be) the Guarantor will pay such additional amounts as may be necessary in order that the net amounts received by the Bondholders and Couponholders after the withholding or deduction shall equal the respective amounts which would have been receivable in respect of the Bonds or, as the case may be, Coupons in the absence of the withholding or deduction; except that no additional amounts shall be payable in relation to any payment in respect of any Bond or Coupon:

to, or to a third party on behalf of, a holder who is liable to the Taxes in respect of the Bond or Coupon by reason of such holder having some connection with the United Kingdom other than the mere holding of the Bond or Coupon; or

to, or to a third party on behalf of, a holder who would not be liable or subject to the withholding or deduction by making a declaration of non-residence or other similar claim for exemption to the relevant tax authority; or

presented for payment more than 30 days after the Relevant Date except to the extent that the holder would have been entitled to additional amounts on presenting the same for payment on the last day of the period of 30 days.

In these Terms and Conditions, "Relevant Date" means the date on which the payment first becomes due, but if the full amount of the money payable has not been received in London by the Principal Paying Agent or the Trustee on or before the due date, it means the date on which, the full amount of the money having been so received, notice to that effect shall have been duly given to the Bondholders by the Issuer in accordance with Condition 14 (Notices).

Any reference in these Terms and Conditions to any amounts in respect of the Bonds shall be deemed also to refer to any additional amounts which may be payable under this Condition or under any undertakings given in addition to, or in substitution for, this Condition 8 pursuant to the Trust Deed.

default is made in the payment of any principal or premium (if any) in respect of any Bond pursuant to Condition 7 (Redemption and Purchase), or for a period of 14 days or more in the payment of any interest due in respect of the Bonds; or

the Issuer or the Guarantor, as the case may be, fails to perform or observe any of its other obligations, covenants, conditions or provisions under the Bonds or the Trust Deed and (except where the Trustee shall have certified to the Issuer or the Guarantor, as applicable, in writing that it considers such failure to be incapable of remedy in which case no such notice or continuation as is hereinafter mentioned will be required) such failure continues for the period of 60 days (or such longer period as the Trustee may permit) following the service by the Trustee on the Issuer or the Guarantor, as applicable, of notice requiring the same to be remedied; or

(i) any other Indebtedness For Borrowed Money of the Issuer, the Guarantor or any of their respective Subsidiaries becomes due and repayable prior to its stated maturity by reason of an event of default (however described) or (ii) any such Indebtedness For Borrowed Money is not paid when due or (iii) the Issuer, the Guarantor or any of their respective Subsidiaries fails to pay when due any amount payable by it under any present or future guarantee for, or indemnity in respect of any Indebtedness For Borrowed Money of any person or (iv) any security given by the Issuer, the Guarantor or any of their respective Subsidiaries for any Indebtedness For Borrowed Money of any person or any guarantee or indemnity of Indebtedness For Borrowed Money of any person becomes enforceable by reason of default in relation thereto and steps are taken to enforce such security save in any such case referred to in (i), (ii), (iii) or (iv) where there is a bona fide dispute as to whether the relevant Indebtedness For Borrowed Money or any such guarantee or indemnity as aforesaid shall be due and payable, and provided that the aggregate amount of the relevant Indebtedness For Borrowed Money in respect of which any one or more of the events mentioned above in this sub-paragraph (c) has or have occurred equals or exceeds 5 per cent of Regulated Asset Value and such event shall continue unremedied or unwaived for more than 14 days (or such longer grace period as may have been originally provided in the applicable instrument) and the time for payment of such amount has not been expressly extended (until such time as any payment default is remedied, cured or waived); or

any order shall be made by any competent court or any resolution shall be passed for the winding up or dissolution of the Issuer or the Guarantor, save for the purposes of amalgamation, merger, consolidation, reorganisation, reconstruction or other similar arrangement on terms previously approved by an Extraordinary Resolution of the Bondholders; or

the Issuer, the Guarantor or any of their respective Subsidiaries shall cease to carry on the whole or substantially the whole of its business, save in each case for the purposes of amalgamation, merger, consolidation, reorganisation, reconstruction or other arrangement (i) not involving or arising out of the insolvency of the Issuer, the Guarantor or such Subsidiary and under which all or substantially all of its assets are transferred, in the case of the Issuer, to a Subsidiary of the Issuer or the Guarantor, in the case of the Guarantor, to a Subsidiary of the Guarantor or, in the case of a Subsidiary, to the Issuer, the Guarantor or another Subsidiary of either of them or to a transferee which is, or immediately upon such transfer becomes such a Subsidiary or (ii) under which all or substantially all of its assets are transferred to a third party or parties (whether a Subsidiary or Subsidiaries of the Issuer or the Guarantor or not) for full consideration by the Issuer, the Guarantor or any such Subsidiary on an arm's length basis or (iii) the terms of which have previously been approved by an Extraordinary Resolution of the Bondholders provided that if the Guarantor shall cease to hold or shall transfer the Electricity Distribution Licence (other than where the Electricity Distribution Licence is revoked, terminated or surrendered in the circumstances envisaged by paragraph (i)(a), (b) or (c) of the definition of Restructuring Event in Condition 3 (Definitions) and such revocation, termination or surrender does not constitute a Restructuring Event pursuant to paragraph (i) of such definition) the Guarantor shall be deemed to have ceased to carry on the whole or substantially the whole of its business (and neither of exceptions (i) and (ii) above shall apply) unless the transferee of the Electricity Distribution Licence is the Issuer or a Subsidiary of the Guarantor, at least 51 per cent of the ordinary share capital of which is owned directly or indirectly by the Guarantor (the "NE Transferee") and in such event all references in these Terms and Conditions to the Guarantor in its capacity as holder of the Electricity Distribution Licence shall thereafter be deemed to be references to the NE Transferee; or

the Issuer, the Guarantor or any of their respective Subsidiaries shall suspend or shall threaten to suspend payment of its debts generally or shall be declared or adjudicated by a competent court to be unable, or shall admit in writing its inability, to pay its debts (within the meaning of Section 123(1) or (2) of the Insolvency Act 1986) as they fall due, or shall be adjudicated or found insolvent by a competent court or shall enter into any composition or other similar arrangement with its creditors under Part I of the Insolvency Act 1986; or

a receiver, administrative receiver, Energy Administrator, administrator or other similar official shall be appointed in relation to the Issuer, the Guarantor or any of their respective Subsidiaries or in relation to the whole or a substantial part of the undertaking or assets of any of them or a distress, execution or other process shall be levied or enforced upon or sued out against, or any encumbrancer shall

the Guarantee of the Bonds is not (or is claimed by the Guarantor not to be) in full force and effect;

If, at any time while any of the Bonds remains outstanding, a Restructuring Event occurs and during the Restructuring Period an Independent Financial Adviser (as defined below) shall have certified in writing to the Trustee that such Restructuring Event is not, in its opinion, materially prejudicial to the interests of the Bondholders, the following provisions of this Condition shall cease to have any further effect in relation to such Restructuring Event.

If, at any time while any of the Bonds remains outstanding, a Restructuring Event occurs and (subject to paragraph (a)(i) above):

within the Restructuring Period, either:

if at the time such Restructuring Event occurs there are Reference Rated Securities, a Rating Downgrade in respect of such Restructuring Event also occurs; or

if at such time there are not Reference Rated Securities, a Negative Rating Event in respect of such Restructuring Event also occurs; and

an Independent Financial Adviser shall have certified in writing to the Trustee that such Restructuring Event is, in its opinion, materially prejudicial to the interests of the Bondholders (a "Negative Certification"),

Promptly upon the Issuer or the Guarantor becoming aware that a Put Event (as defined in Condition 3 (Definitions)) has occurred, and in any event not later than 14 days after the occurrence of a Put Event, the Issuer or the Guarantor (as the case may be) shall, and at any time upon the Trustee becoming similarly so aware the Trustee may, and (subject to it being indemnified and/or prefunded and/or secured to its satisfaction) if so requested by the holders of at least one-quarter in principal amount of the Bonds then outstanding shall, give notice (a "Put Event Notice") to the Bondholders in accordance with Condition 14 (Notices) specifying the nature of the Put Event and the procedure for exercising the Put Option.

To exercise the Put Option, the holder of a Bond must deliver such Bond to the specified office of any Paying Agent, on a day which is a business day (as defined in Condition 6 (Payments)) in London and in the place of such specified office falling within the period (the "Put Period") of 45 days after that on which a Put Event Notice is given, accompanied by a duly completed and signed notice of exercise in the form (for the time being current) obtainable from any specified office of any Paying Agent (a "Put Notice") and in which the holder may specify a bank account complying with the requirements of Condition 6 (Payments) to which payment is to be made under this Condition. Each Bond should be delivered together with all Coupons appertaining thereto maturing after the day (the "Put Date") being the fifteenth day after the date of expiry of the Put Period, failing which any such missing Coupon will become void and no payment shall be made in respect of it. The Paying Agent to which such Bond and Put Notices are delivered shall issue to the Bondholder concerned a non-transferable receipt in respect of the Bond so delivered. Payment in respect of any Bond so delivered shall be made, if the holder duly specifies 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 each case against presentation and surrender or (as the case may be) endorsement of such receipt at any specified office of any Paying Agent, subject in any such case as provided in Condition 6 (Payments). A Put Notice, once given, shall be irrevocable. For the purposes of Conditions 9 (Prescription), 10 (Events of Default), 12 (Enforcement), 13 (Replacement of Bonds and Coupons) and 15 (Meetings of Bondholders,

Limitation on Bondholders: Only the Trustee may pursue the remedies available under general law or under the Trust Deed to enforce the rights of the Bondholders and Couponholders and no such holder will be entitled to proceed against the Issuer or the Guarantor unless the Trustee, having become bound to act in accordance with the terms of the Trust Deed, fails to do so within a reasonable amount of time and such failure is continuing.

Enforcement Proceedings: At any time after amounts in respect of principal of and interest on the Bonds shall have become due and payable but are unpaid, the Trustee may, at its discretion, and without further notice but subject as mentioned below, take such proceedings against the Issuer and/or the Guarantor as it may think fit to enforce the provisions of the Trust Deed in accordance with the terms thereof.

The Trust Deed contains provisions for convening meetings of the Bondholders to consider any matter affecting their interests, including modification by Extraordinary Resolution of these Terms and Conditions or the provisions of the Trust Deed. The quorum at any such meeting for passing an Extraordinary Resolution shall be two or more persons holding or representing more than half in principal amount of the Bonds for the time being outstanding, or at any adjourned such meeting two or more persons being or representing Bondholders whatever the principal amount of the Bonds so held or represented, except that, at any meeting the business of which includes the modification of certain of these Terms and Conditions and certain of the provisions of the Trust Deed (including altering the currency of payment of the Bonds or Coupons), the necessary quorum for passing an Extraordinary Resolution will be two or more persons holding or representing not less than two-thirds, or at any adjourned such meeting not less than one-third, in principal amount of the Bonds for the time being outstanding. An Extraordinary Resolution passed at any meeting of Bondholders shall be binding on all Bondholders, whether or not they are present or represented at the meeting, and on all Couponholders.

The Trustee may, without the consent of the Bondholders or Couponholders, agree (i) other than in respect of Reserved Matters (as specified and defined in Schedule 5 to the Trust Deed), to any modification to these Terms and Conditions or to any of the provisions of the Trust Deed or to any waiver or authorisation of any breach or proposed breach by the Issuer or the Guarantor of these Terms and Conditions or of any of the provisions of the Trust Deed or determine that any event, condition or act which would otherwise be an Event of Default, Potential Event of Default or Restructuring Event shall not be so treated provided that, in the opinion of the Trustee, so to do would not be materially prejudicial to the interests of the Bondholders, and provided further that the Trustee will not do so in contravention of any express direction given by any Extraordinary Resolution or a written request made pursuant to Condition 10 (Events of Default) but no such direction or request will affect any previous waiver, authorisation or determination, or (ii) to any modification to these Terms and Conditions or to any of the provisions of the Trust Deed which is made to correct a manifest error or which is of a formal, minor or technical nature.

In connection with the exercise of its trusts, powers, authorities or discretions (including, but not limited to, any modification, waiver, authorisation or substitution) the Trustee shall have regard to the interests of Bondholders as a class and, in particular, but without limitation, shall not have regard to the consequences of the exercise of its trusts, powers or discretions for individual Bondholders and Couponholders resulting from their being for any purpose domiciled or resident in, or otherwise connected with, or subject to the jurisdiction of, any particular territory and the Trustee shall not be entitled to require, nor shall any Bondholder or Couponholder be entitled to claim, from the Issuer, the Guarantor or any other person any indemnification or payment in respect of any tax consequence of any such exercise upon individual Bondholders or Couponholders, except to the extent already provided for in Condition 8

Any modification to these Terms and Conditions or to any of the provisions of the Trust Deed or any waiver or authorisation of any breach or proposed breach by the Issuer or the Guarantor of these Terms and Conditions or any of the provisions of the Trust Deed shall be binding on the Bondholders and the Couponholders and, unless the Trustee agrees otherwise, any modification shall be notified by the Issuer to the Bondholders as soon as practicable thereafter in accordance with Condition 14 (Notices).

Subject as mentioned below, power will be reserved to the Issuer to create and issue Further Bonds forming (or so as to form after the first payment of interest thereon) a single series with the Bonds provided that:

the Trustee is satisfied that the rating granted in respect of the Bonds by S&P and Fitch will not thereby be adversely affected; and

such issue shall be constituted by a deed supplemental to the Trust Deed (in such form as the Trustee may approve) and guaranteed by the Guarantor.

The Issuer shall not be entitled to exercise the power reserved in this Condition 17 (Further Bonds) while any default exists in relation to any payment by the Issuer of any amounts due under the Trust Deed.

certifying that certain specified Bonds (each a "Deposited Bond") have been deposited with such Paying Agent (or to its order at a bank or other depositary) or blocked in an account with a clearing system and will not be released until the earlier of:

the conclusion of the Meeting; and

the surrender to such Paying Agent, not less than 48 hours before the time fixed for the Meeting (or, if the Meeting has been adjourned, the time fixed for its resumption), of the receipt for the deposited or blocked Bonds and notification thereof by such Paying Agent to the Issuer, the Guarantor and the Trustee; and

certifying that the depositor of each Deposited Bond or a duly authorised person on its behalf has instructed the relevant Paying Agent that the votes attributable to such Deposited Bond are to be cast in a particular way on each resolution to be put to the Meeting and that, during the period of 48 hours before the time fixed for the Meeting, such instructions may not be amended or revoked;

listing the total number and (if in definitive form) the certificate numbers of the Deposited Bonds, distinguishing for each resolution between those in respect of which instructions have been given to vote for, or against, the resolution; and

authorising a named individual or individuals to vote in respect of the Deposited Bonds in accordance with such instructions;

any such person whose appointment has been revoked and in relation to whom the relevant Paying Agent has been notified in writing of such revocation by the time which is 48 hours before the time fixed for such Meeting; and

any such person appointed to vote at a Meeting which has been adjourned for want of a quorum and who has not been re‑appointed to vote at the Meeting when it is resumed;

for all business other than voting on an Extraordinary Resolution, one tenth;

for voting on any Extraordinary Resolution other than one relating to a Reserved Matter, more than half; and

for voting on any Extraordinary Resolution relating to a Reserved Matter, two thirds;

for all business other than voting on an Extraordinary Resolution relating to a Reserved Matter, the fraction of the aggregate principal amount of the outstanding Bonds represented or held by the Voters actually present at the Meeting; and

for voting on any Extraordinary Resolution relating to a Reserved Matter, one third;

to effect the exchange or substitution of the Bonds for, or the conversion of the Bonds into, shares, bonds or other obligations or securities of the Issuer, the Guarantor or any other person or body corporate formed or to be formed (other than as permitted under Clause 15.2 of this Trust Deed);

(other than as permitted under Clause 15.2 of this Trust Deed) to approve the substitution of any person for the Issuer (or any previous substitute) as principal debtor under the Bonds;

to modify any provision of the guarantee of the Bonds (other than as permitted under Clause 15.2 of this Trust Deed);

to postpone the maturity of the Bonds or the dates on which interest is payable in respect of the Bonds;

to reduce or cancel the principal amount of, any premium payable on redemption of, or interest on the Bonds;

to change the currency in which amounts due in respect of the Bonds are payable;

to change the quorum required at any Meeting or the majority required to pass an Extraordinary Resolution; or

to amend this definition;

that the Deposited Bonds have been deposited with such Paying Agent (or to its order at a bank or other depositary) or blocked in an account with a clearing system and will not be released until the earlier of:

the conclusion of the Meeting; and

the surrender of such certificate to such Paying Agent; and

that the bearer of such certificate is entitled to attend and vote at the Meeting in respect of the Deposited Bonds;

in the case of a Meeting requested by Bondholders, it shall be dissolved; and

in the case of any other Meeting (unless the Issuer, the Guarantor and the Trustee otherwise agree), it shall be adjourned for such period (which shall be not less than 14 days and not more than 42 days) and to such place as the Chairman determines (with the approval of the Trustee); provided, however, that:

the Meeting shall be dissolved if the Issuer, the Guarantor and the Trustee together so decide; and

no Meeting may be adjourned more than once for want of a quorum.

10 days' notice (exclusive of the day on which the notice is given and of the day on which the Meeting is to be resumed) shall be sufficient; and

the notice shall specifically set out the quorum requirements which will apply when the Meeting resumes.

Voters;

representatives of the Issuer, the Guarantor and the Trustee;

the financial advisers of the Issuer, the Guarantor and the Trustee;

the legal counsel to the Issuer, the Guarantor and the Trustee and such advisers; and

any other person approved by the Meeting or the Trustee.

on a show of hands, one vote; and

on a poll, one vote in respect of each £100,000 in aggregate face amount of the outstanding Bond(s) represented or held by him.

to approve any Reserved Matter proposed or accepted by the Issuer and the Guarantor (acting together);

to approve any proposal by the Issuer and the Guarantor (acting together) for any modification, abrogation, variation or compromise of, or arrangement in respect of, the rights of the Bondholders and/or the Couponholders against the Issuer (whether such rights shall arise under the Trust Deed or otherwise);

to approve any proposal by the Guarantor for any modification of any provision of the guarantee of the Bonds or any arrangement in respect of the obligations of the Guarantor thereunder;

to waive or authorise any breach by the Issuer, the Guarantor or both of them of their obligations under this Trust Deed;

to assent to any modification of this Trust Deed, the Bonds or the Paying Agency Agreement proposed or accepted by the Issuer and the Guarantor;

to approve a person proposed to be appointed as a new Trustee and to remove any Trustee;

to authorise the Trustee (subject to its being indemnified and/or secured and/or prefunded) or any other persons to execute all documents and do all things necessary to carry out and give effect to any Extraordinary Resolution;

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 Bonds or the Coupons;

to give any authority, direction or sanction which under this Trust Deed or the Bonds is required to be given by Extraordinary Resolution; and

to appoint any persons (whether Bondholders or not) as a committee or committees to represent the interests of the Bondholders and to confer upon such committee or committees any powers which the Bondholders could themselves exercise by Extraordinary Resolution.