Service contracts
Each of the Executive Directors is employed on a rolling contract subject to one year’s notice if given by the company and six months’ notice if given by the Executive Director. This notice period was reduced in 2002 from two years and new service contracts have been entered into as follows:

Director	Employing company	Date of contract
W M Castell	Amersham plc	1 March 2002
G W Battersby	Amersham plc	1 March 2002
A Carr	Amersham Biosciences UK Limited	16 December 2002
G F B Kerr	Amersham plc	1 March 2002
P Loescher	Amersham plc	1 December 2002

The Committee believes that in order to attract Executive Directors of the right calibre and to compete for talent with our competitors, it is necessary to offer service contracts with notice periods of one year, which explicitly set out the provisions relating to termination of the contract.

Under the terms of the Executive Directors' service contracts, on termination of employment by the company, except in the case of dismissal for cause, the company shall make a payment to the Executive Director equal to 95% of:

Such payment shall be reduced proportionately in the event that the Executive works part of his period of notice. When the company has given notice of termination, such payment shall be made within three months of the date of notice. Any payment shall be entirely discretionary when the Executive has given notice of termination. In the event that the employment is terminated for any other reason, such payment shall be made forthwith. There are no special provisions in the event of a change of control of the company except for Mr Battersby. In the event of a change of control of the company, which leads to Mr Battersby leaving the company within a period of 12 months following such change of control, the pension element of the Agreed Payment detailed above may be enhanced by up to five years' contributions. This enhancement shall reduce progressively to zero by 2008 and was agreed at the time of his recruitment.

On 31 December 2002, Dr J M Padfield retired from the Board in order to facilitate succession planning. He received a payment of £841,035 in respect of his contractual entitlements, comprising 95% of the total of his salary (£390,000), bonus (£300,300), pension benefits (£156,000) and other benefits (£39,000). These figures are included in the remuneration table and notes below.

During the year, Mr P Loescher joined the company from Japan. The costs of his relocation, his housing and his children's education are being met by the company in line with the company's expatriate policy. In addition, he received a signing-on bonus of euros 500,000 (£316,455). All amounts are disclosed in the Directors' remuneration table below. The company has agreed to compensate Mr Loescher for the loss of the bonus he would have received from his previous company had he not joined Amersham.

Non-Executive Directors are appointed for an initial period of three years, subject to subsequent renewal by agreement. Details of when each Director was appointed are shown in the Directors' biographies. There are no compensation provisions for early termination of Non-Executive Director appointments.

Directors' detailed emoluments
The remuneration of each Director for the period ended 31 December 2002 is analysed as follows:

	Salary and fees £	Benefits1 £	Bonus £	Total remuneration for 12 months to 31 Dec 2002 before pension contributions £	Pension contributions £	Compensation for loss of office £	Total remuneration for 12 months to 31 Dec 2002 £	Total remuneration for 12 months to 31 Dec 2001 £
Executive Directors
W M Castell
(Chief Executive)	575,000	88,395	397,200	1,060,595	–	–	1,060,595	963,485
G W Battersby	266,250	32,659	182,050	480,959	85,747	–	566,706	589,030
A Carr2
(appointed 9 May 2002)	261,558	23,275	91,600	376,433	2,349	–	378,782	–
G F B Kerr	302,500	93,717	198,710	594,927	10,056	–	604,983	557,739
P Loescher3
(appointed 1 December 2002)	353,955	104,855	–	458,810	–	–	458,810	–
J M Padfield4	386,364	46,925	266,370	699,659	129,518	841,035	1,670,212	788,173
Total – Executive	2,145,627	389,826	1,135,930	3,671,383	227,670	841,035	4,740,088	2,898,427
Non-Executive Directors
R D Lapthorne (Chairman)	155,000	–	–	155,000	–	–	155,000	120,000
J Fr Odfjell	66,353	–	–	66,353	–	–	66,353	60,000
D H Brydon	41,667	–	–	41,667	–	–	41,667	30,000
J H Johansen5	35,833	–	–	35,833	–	–	35,833	30,000
J Patterson	35,833	–	–	35,833	–	–	35,833	29,348
K Peters6	71,483	–	–	71,483	–	–	71,483	67,500
J F Rejeange	35,833	–	–	35,833	–	–	35,833	30,000
E Thorsby	35,833	–	–	35,833	–	–	35,833	30,000
M Uhlén7
(appointed 9 May 2002)	25,141	–	–	25,141	–	–	25,141	–
Total – Non-Executive	502,976	–	–	502,976	–	–	502,976	396,848
Past Directors
M J Crumpton8	61,500	10,304	–	71,804	–	–	71,804	90,823
T V Jacobsen9	–	77	–	77	–	–	77	136,866
R E Long10	343,763	15,934	–	359,697	–	–	359,697	275,754
T F W McKillop	–	–	–	–	–	–	–	2,500
Total – Past Directors	405,263	26,315	–	431,578	–	–	431,578	505,943
Total	3,053,866	416,141	1,135,930	4,605,937	227,670	841,035	5,674,642	3,801,218
1 The figures shown for benefits include amounts payable in respect of private medical insurance, permanent health insurance, the provision of company cars and fuel and amounts received in cash for pensions. 2 In addition to the figures shown in the table above in respect of Dr A Carr, he received $196,153.83 (£130,769.22) in respect of his employment as President of Amersham Biosciences prior to his appointment to the Board on 9 May 2002 {2001 – $879,229 (£582,271)}. 3 Mr P Loescher received a signing-on bonus of euros 500,000 (£316,455) shown in salaries. This amount is included in the figures shown in the table above. The figure for Mr P Loescher’s benefits include the costs of his relocation from Japan and the costs for his housing and children’s education. In addition, the company has agreed to compensate Mr Loescher for the loss of the bonus he would have received from his previous company had he not joined Amersham. The precise amount is not yet known but is expected to lie within the range of euros 300,000 to euros 650,000. 4 Dr J M Padfield received £841,035 in respect of his contractual entitlements following his retirement on 31 December 2002. This amount is included in the figures shown in the table above and explained in detail here. 5 In addition to the fees shown in the table above Mr J H Johansen received NOK 511,923 (£45,973) in salary and NOK 18,161 (£1,631) in benefits as an employee. 6 Professor Sir Keith Peters received fees of £35,650 in respect of his services on the Science Advisory Board. This amount is included in the figures shown in the table above. 7 In addition to the figures shown in the table above in respect of Prof M Uhlén, he received £7,141 in respect of his services as a Non-Executive Director of Amersham Biosciences Limited before his appointment to the Board on 9 May 2002. In addition 1,200,000 SEK (£86,894) was payable to MU Bioteknik AB, a company of which Prof Uhlén is the sole director and sole shareholder in respect of royalty payments on patent rights. Payments have been made for the past seven years. They are not regarded as material. The Board accordingly regards Prof Uhlén as independent for corporate governance purposes. 8 Mr Crumpton received consultancy fees during the year of £45,000 and £16,500 in respect of his services on the Science Advisory Board. In addition, he received £10,304 in benefits. 9 Mr Jacobsen resigned as a Director of the company on 16 June 1999. During the year he received NOK 859 (£77) in benefits. 10 Mr R E Long resigned as a Director of the company on 23 March 2001. During the year, Mr R E Long has provided consultancy services to the company for which he has received £80,592 as fees and£15,934 in benefits. In addition, £263,171 has been paid in consultancy fees to Scicona Limited, a company of which he is a director. These figures are disclosed in the above table.

Directors' interests
There were no contracts of significance subsisting during or at the end of the year in which a Director of the company is or was materially interested.

Interests in shares
The Directors' and their families' beneficial interests in the share capital of the company are shown below:

	31 Dec 2002 Ordinary 5p shares	As at 31 Dec 2001 or at date of appointment Ordinary 5p shares
W M Castell	243,570	243,570
G W Battersby	25,000	25,000
D H Brydon	2,585	2,585
A Carr	1,958	1,566
J H Johansen	11,610	11,610
G F B Kerr	10,000	10,000
R D Lapthorne	105,170	105,170
P Loescher	–	–
J Fr Odfjell	53,150	53,150
J M Padfield	3,564	3,564
J Patterson	2,923	2,923
K Peters	3,111	–
J F Rejeange	–	–
E Thorsby	17,800	17,800
M Uhlén	–	–
	480,441	476,938

Details of interests in conditional awards under the Long Term Incentive Plan (LTIP) are detailed here. Each Director is deemed to be interested in all of the shares held by the Amersham ESOP Trust which at 31 December 2002, amounted to 545,282 Ordinary 5p shares (1 January 2002, 550,287 Ordinary 5p shares). Each Executive Director is deemed to be interested in all of the shares held by Amersham Trustees Limited (the trustee of a UK Inland Revenue tax approved QUEST) which amounted to 770,057 Ordinary 5p shares at 31 December 2002 (1 January 2002, 1,607,294 Ordinary 5p shares).

There has been no change since the year end in the interest of Directors in the company's shares.

Interests in share options
The interests of the Directors in Amersham plc share options held under the Executive Share Option Scheme (ESOS) and the Sharesave Scheme (SAYE) are set out below. These options are exercisable from November 1996 to September 2012 and are held under the company's plans referred to in note 25 to the accounts (PDF). No options lapsed during the year.

Option interests¹

		At 31 Dec 2001 date of appointment		Granted during the year		Exercised during the year			At 31 Dec 2002
		Number of ordinary 5p shares	Weighted average subscription price	Number of ordinary 5p shares	Weighted average subscription price	Number ordinary 5p shares	Weighted average subscription price	Market price on date of exercise	Number of ordinary 5p shares	Weighted average subscription price
W M Castell	ESOS 1993	116,988a	£4.82	-	-	-	-	-	116,988	£4.82
		186,934b	£6.23	-	-	-	-	-	186,934	£6.23
	ESOS 2001	-a	-	-	-	-	-	-	-	-
		178,572b	£5.60	-	-	-	-	-	178,572	£5.60
		-	-	139,864b	£7.15	-	-	-	139,864	£7.15
	SAYE	2,679a	£3.30	1,001	£4.49	-	-	-	3,680	£3.62
G W Battersby	ESOS 1993	-a	-	-	-	-	-	-	-	-
		128,618b	£6.22	-	-	-	-	-	128,618	£6.22
	ESOS 2001	-a	-	-	-	-	-	-	-	-
		85,716b	£5.60	-	-	-	-		85,716	£5.60
		-	-	67,136b	£7.15	-	-	-	67,136	£7.15
	SAYE	3,402a	£4.96	-	-	-	-	-	3,402	£4.96
A Carr	ESOS 1993	83,654a	£4.43	-	-	-	-	-	83,654	£4.43
		-b	-	-	-	-	-	-	-	-
	ESOS 2001	-a	-	-	-	-	-	-	-	-
		289,948b	£5.60	-	-	-	-	-	289,948b	£5.60
		-	-	102,756b	£7.15	-	-	-	102,756b	£7.15
	SAYE	3,045a	£4.47	-	-	-	-	-	3,045	£4.47
		392a	£2.46	-	-	392	£2.46	£5.52	-	-
Options for All		1,000b	£6.35						1,000	£6.35
G F B Kerr	ESOS 1993	244,918a	£4.18	-	-	-	-	-	244,918	£4.18
		37,913b	£6.23						37,913	£6.23
	ESOS 2001	-a	-	-	-	-	-	-	-	-
		100,000b	£5.60						100,000	£5.60
		-	-	78,324b	£7.15	-	-	-	78,324	£7.15
	SAYE	-	-	-	-	-	-	-	-	-
P Loescher	ESOS 2001	-a	-	-	-	-	-	-	-	-
		-	-	309,280b	£5.82	-	-	-	309,280	£5.82
J M Padfield	ESOS 1993	349,662a	£4.29	-	-	-	-	-	349,662	£4.29
		57,785b	£6.23						57,785b	£6.23
	ESOS 2001	-a	-	-	-	-	-		-	-
		121,432b	£5.60	-	-	-	-	-	121,432b	£5.60
		-	-	-	95,108	£7.15	-	-	95,108b	£7.15
	SAYE	5,568a	£3.30	-	-	-	-	-	5,568	£3.30
1 Options granted under ESOS and ESOS 2001 are exercisable between three and ten years from the date of grant and options granted under SAYE are exercisable, three, .ve or seven years from the date of grant. These options are subject to the performance conditions explained. Options granted where the market share price on 31 December 2002 (£5.56) was above the grant price are marked with a. Options granted where the market share price on 31 December 2002 (£5.56) is below the grant prices are marked with b. No other Directors have been granted options over the shares of the company or any other group companies.

Restricted shares
On 4 December 2002, 77,320 restricted shares were awarded to P Loescher on his joining the company. 50% of these shares vest on 4 December 2004 and the remaining 50% vest on 4 December 2005, subject to his still being an employee of the company.

The share price on the date of the award was £5.69. The shares for the award to P Loescher will be supplied by the Amersham ESOP Trust. The Remuneration Committee concluded that such awards were necessary to recruit P Loescher and therefore, the committee made such an award relying on the exemption in chapter 13.13A of the UKLA Listing Rules. In the event that P Loescher ceases to be employed by the company, his awards will lapse unless the Remuneration Committee determine otherwise, except in the circumstances of his death, when his personal representatives may exercise his awards. The Remuneration Committee will not make amendments to the arrangements established for P Loescher that are to his advantage, without seeking the consent of shareholders. No benefits under the arrangements are pensionable.

Interests in awards under the LTIP
In previous years, 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 LTIP. No awards were made under this Plan in 2002.

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

	Number of awards1	Date granted	Market value on date of grant	Date vested2,3	Market value on vesting date	Number of awards vesting during the year4	Date exercised	Market value on exercise date
W M Castell	27,041	17-Jun-99	£4.8075	17-Jun-02	£5.80	24,336	N/A	N/A
	29,878	31-Mar-00	£5.1544	N/A	N/A	N/A	N/A	N/A
G W Battersby	Nil	N/A	N/A	N/A	N/A	N/A	N/A	N/A
A Carr	8,381	31-Mar-00	£5.1544	N/A	N/A	N/A	N/A	N/A
G F B Kerr	15,939	22-Apr-98	£4.2656	22-Apr-01	£4.77	Nil	N/A	N/A
	15,809	17-Jun-99	£4.8075	17-Jun-02	£5.80	14,228	N/A	N/A
	17,461	31-Mar-00	£5.1544	N/A	N/A	N/A	N/A	N/A
P Loescher	Nil	N/A	N/A	N/A	N/A	N/A	N/A	N/A
J M Padfield	23,281	31-Mar-00	£5.1544	N/A	N/A	N/A	N/A	N/A
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. 1 No awards were made in 2002. 2 Awards vest three years from the date of grant, subject to performance conditions. 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. 3 Awards will only vest if 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. 4 The awards made in 1999 vested as to 90% in 2002 as the company was ranked 25th out of the 100 companies in its comparator group.

The company’s register of Directors’ interests, which is open for inspection, contains full details of Directors’ share interests, options to subscribe for shares and awards of restricted shares.

London share prices
The market price of the company’s ordinary 5p shares at the end of the .nancial period was 556p. The range of market prices during the year was as follows:

	1 Jan 2002 to 31 Dec 2002
	Low	High
Ordinary 5p shares	455.5p	768.5p

The following sections of the Directors’ remuneration report are auditable:

Pensions
Directors’ detailed emoluments
Directors’ interests
Interests in share options
Restricted shares
Interests in awards under the long term incentive plan

On behalf of the Board
R D Lapthorne
Chairman, Remuneration Committee
26 February 2003