Long term incentive plan (LTIP)
The company has operated a long term incentive plan (LTIP) which was intended to provide a long term incentive to Executives and to further align their interests with those of the shareholders.

Following the introduction of the new Executive Share Option Scheme in 2001, it is not proposed to make any further awards under the Long Term Incentive Plan and no awards were made under this plan in 2001.

Under the LTIP awards of ordinary shares have been made to participants in the LTIP by the trustees of the Amersham plc ESOP Trust, a trust established by the company and operated by an independent firm of trustees. The receipt of shares by the participants depends upon the performance of the company over a three-year period, which is measured by the growth in the total shareholder return of the company relative to the FTSE 100 index of companies. No shares will vest in the participants unless the company’s total shareholder return would place it in at least 60th position amongst the FTSE 100 companies ranked by total shareholder return and the maximum number of shares will vest only if the performance would rank it at 20th place or better. If the performance conditions are not satisfied in full and an award does not vest, the performance period may be extended by up to a maximum of two years.

The following grants of awards of ordinary shares each have been made to Executive Directors under the LTIP:

	Number of awards1	Date granted2	Market value on date of grant	Date vested3	Market value on vesting date	Date exercised	Market value on exercise date
W M Castell	30,477	22 Apr 98	£4.2656	22 Apr 01	£4.77	2 May 01	£5.54
	27,041	17 Jun 99	£4.8075	-	-	-	-
	29,878	31 Mar 00	£5.1544	-	-	-	-
G F B Kerr	15,939	22 Apr 98	£4.2656	22 Apr 01	£4.77	-	-
	15,809	17 Jun 99	£4.8075	-	-	-	-
	17,461	31 Mar 00	£5.1544	-	-	-	-
J M Padfield	23,281	31 Mar 00	£5.1544	-	-	-	-

Pensions
Sir William Castell is entitled to a total target pension upon retirement at age 60 of 60% of the average of the last three years’ basic salary. The pension payable by the company will be this target pension, less pension benefits earned in previous employments. This pension will also include the pension which could be notionally secured by Sir William Castell from past remuneration supplements.

Approximately two-thirds of the total target pension is being funded, through a combination of approved and unapproved arrangements. The remainder of the pension will be provided on an unfunded basis and provision is made in the accounts for this.

The accumulated total accrued pension shown in the table below represents the accrued portion of the pension payable to the Director by the company. The increase in accrued pension during the year is also shown net of inflation.

Mr G W Battersby, Mr G F B Kerr and Dr J M Padfield accrue pension benefits through a combination of approved defined benefit arrangements and unapproved defined contribution arrangements. Details are shown below of the defined benefit accrual and the contribution to the Funded Unapproved Retirement Benefits Scheme element is identified in the column headed ‘Pension contributions’ in the table below.

Details of pension arrangements under the group’s pension schemes for Executive Directors are set out below:

Name	Age at 31 Dec 2001	Director's contribution in the year £	Increase in accrued pension during the year £	Accumulated total accrued pension at 31 Dec 2001 £
W M Castell	54	Nil	40,300	158,100
J M Padfield	54	4,725	1,575	3,677
G F B Kerr	42	4,725	2,009	21,021
G W Battersby	55	4,725	1,575	2,102

Name	Normal retirement age	Early retirement terms	Dependant's pension	Pension increases
W M Castell	60	Reduced by 4% for each year earlier than 60	66% of Member's Pension	RPI up to 5%
J M Padfield	63	Unreduced from age 60 and between 50 and 60 reduced by 4% for each year earlier than 60	50% of Member's Pension	RPI up to 7.5% plus 50% of RPI in excess, subject to maximum of 8.75%
G F B Kerr	63	Unreduced from age 60 and between 50 and 60 reduced by 4% for each year earlier than 60	66% of Member's Pension	RPI up to 7.5% plus 50% of RPI in excess, subject to maximum of 8.75%
G W Battersby	63	Unreduced from age 60 and between 50 and 60 reduced by 4% for each year earlier than 60	50% of Member's Pension	RPI up to 7.5% plus 50% of RPI in excess, subject to maximum of 8.75%

	Salary and fees £	Benefits £	Bonus £	Total remuneration for 12 months to 31 Dec 2001 before pension contributions £	Pension contributions £	Total remuneration for 12 months to 31 Dec 2001 £	Total for 12 months to 31 Dec 2000 £
Executive Directors
W M Castell (Chief Executive)	477,750	82,735	403,000	963,485	-	963,485	634,469
G F B Kerr	268,500	39,173	214,480	522,153	35,586	557,739	418,013
R E Long (resigned 23 March 2001)	67,500	10,630	-	78,130	-	78,130	426,010
J M Padfield	332,500	41,335	314,500	688,335	99,838	788,173	635,937
G W Battersby	235,000	95,072	193,440	523,512	65,518	589,030	360,097
Total - Executive	1,381,250	268,945	1,125,420	2,775,615	200,942	2,976,557	2,474,526
Non-Executive Directors
R D Lapthorne (Chairman)	120,000	-	-	120,000	-	120,000	120,000
J Fr Odfjell	60,000	-	-	60,000	-	60,000	60,000
D H Brydon	30,000	-	-	30,000	-	30,000	30,000
J H Johansen1	30,000	-	-	30,000	-	30,000	30,000
T F W McKillop (resigned 9 January 2001)	2,500	-	-	2,500	-	2,500	30,000
J Patterson (appointed 9 January 2001)	29,348	-	-	29,348	-	29,348	-
K Peters2	67,500	-	-	67,500	-	67,500	27,391
J F Rejeange	30,000	-	-	30,000	-	30,000	30,000
E Thorsby	30,000	-	-	30,000	-	30,000	30,000
Total - Non-Executive	399,348	-	-	399,348	-	399,348	357,391
Past Directors
R M Cresswell	-	-	-	-	-	-	30,425
M J Crumpton	77,500	13,323	-	90,823	-	90,823	89,377
T V Jacobsen	120,602	4,717	-	125,319	11,547	136,866	159,046
R E Long3	165,735	31,889	-	197,624	-	197,624	-
J C Maynard	-	-	-	-	-	-	13,333
Total - Past Directors	363,837	49,929	-	413,766	11,547	425,313	292,181
Total	2,144,435	318,874	1,125,420	3,588,729	212,489	3,801,218	3,124,098

1	In addition to the fees shown in the table above paid to Mr Johansen as a Director, he received NOK503,388 (£38,782) in salary and NOK 2,964 (£228) in benefits as an employee.
2	Professor Sir Keith Peters received fees of £37,500, included in the table above, in respect of his services on the Scientific Advisory Board.
3	Mr R E Long resigned as a Director of the company on 23 March 2001, since then he has received salary, benefits and consultancy fees totalling £197,624, as shown in the table above.

Sir William Castell was the highest paid Director during the year and also in 2000. His notional gain on the exercise of his Executive and Sharesave options during the year amounted to £1,231,165 (year to 31 December 2000 – £0).His notional gain on the exercise of LTIP awards amounted to £168,843 (year to 31 December 2000 – £209,494).

The Remuneration report continues on the next page »
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