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Brambles Industries (BI.)

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Wednesday 15 October, 2003

Brambles Industries

CEO - service contract

Brambles Industries PLC
15 October 2003


BRAMBLES INDUSTRIES PLC

Company Number: 4134697




              NEW CONTRACTUAL ARRANGEMENTS FOR CEO - DAVID TURNER


On 25 September 2003, we announced the appointment of Mr David Turner as Chief
Executive Officer of Brambles, with effect from 21 October 2003. At that time,
we advised that details of Mr Turner's new contractual arrangements would be
announced in the near future.

These arrangements have now been finalised. A summary of the key terms,
including details of a supplementary grant of Options and Performance Shares to
Mr Turner as at 14 October 2003, is set out in the attachment.

We also wish to advise that, since the announcement on 25 September 2003, Sir CK
Chow has offered to surrender without compensation the performance shares which,
under that announcement, were to have been retained by him following termination
of his employment. Brambles has accepted that offer and, as a result, on Sir
CK's departure, all options and performance shares granted to him, including his
sign-on grant, will lapse.





For further information, contact:

UK
Investor    Sue Scholes, Head of Investor Relations      +44 (0) 20 7659 6012
Media       Richard Mountain, Financial Dynamics         +44 (0) 20 7269 7291

Australia
Investor    John Hobson, Head of Investor Relations      +61 (0) 2 9256 5222
Media       Jeannette McLoughlin, Group General Manager, +61 (0) 2 9256 5255
            Corporate
            Communications                            Mobile +61 (0) 401 990 425



Brambles is globally headquartered in Australia





              SUMMARY OF KEY TERMS OF NEW CONTRACTUAL ARRANGEMENTS

                              FOR MR DAVID TURNER

                       CHIEF EXECUTIVE OFFICER - BRAMBLES

1.         Service Contract

Mr Turner continues to be employed under his original service contract with
Brambles Industries Limited dated 26 July 2001, as amended (Service Contract).
Details of the Service Contract were set out in the documentation sent to
shareholders in connection with the formation of the Brambles dual listed
companies structure. Except as specified below, the terms of the Service
Contract are unaffected. Mr Turner is a resident of Australia and the Service
Contract is governed by relevant Australian law.

2.         Term

Mr Turner's appointment as Chief Executive Officer is effective on 21 October
2003.

The Service Contract may be terminated by Brambles without cause on giving 12
months' notice and by Mr Turner without cause on giving six months' notice.
Further details concerning termination arrangements and Mr Turner's entitlements
on termination are set out in section 5 below.

Mr Turner's performance will be reviewed at the end of each financial year.

3.         Total Fixed Remuneration and other Benefits

Under the Service Contract, Mr Turner is remunerated based on the concept of
'total fixed remuneration' or 'TFR'. Under these arrangements, Mr Turner is
provided with a TFR amount which covers basic salary, pension contributions,
healthcare, disability, life insurance and motor vehicle benefits (including any
applicable fringe benefits tax). Mr Turner has flexibility to elect the manner
in which that TFR amount is received by him - that is, the proportion of the TFR
amount actually received each month by way of basic salary, pension
contributions and other benefits, as long as the implementation of the proposal
does not result in an increase in cost to Brambles.

With effect from the date of his appointment as Chief Executive Officer, Mr
Turner's annual TFR will increase to £963,800. On 1 July 2004, his annual TFR
will be increased to £1,090,050 and on 1 July 2005 his annual TFR will be
increased to £1,133,652. Thereafter his TFR will be reviewed annually on 1 July.

Mr Turner will continue to be provided with accommodation and relocation-related
costs for himself and his immediate family.

4.         Incentive arrangements

Mr Turner will continue to participate in Brambles' Short and Long Term
Incentive Plans (Plans). Details of the Plans and Mr Turner's participation in
them were outlined in the Remuneration Report in the Brambles 2003 Annual Report
to Shareholders (Remuneration Report). Except as set out below, Mr Turner's
participation in those Plans remains as outlined in the Remuneration Report.

Short Term Incentive Plan

Mr Turner participates in a short term incentive (STI) plan which offers the
opportunity for him to receive an annual cash bonus for the achievement of
specific, pre-determined performance targets. For the 2004 year, 90% of the
maximum possible award under the STI plan will relate to Brambles' improvement
in profit before tax and amortisation of goodwill (PBTA) against preset targets.
The remaining 10% will be based on performance against personal objectives, but
will be only be payable if Brambles achieves certain threshold financial
performance levels.

For on-target performance, Mr Turner will be entitled to 55% of his annual TFR.
For outstanding performance, payment might reach a maximum of 100% of annual
TFR.

Long Term Incentive Plans

Mr Turner will continue to receive annual grants of Options under the Brambles
2001 Executive Share Option Plan (Option Plan) and rights to acquire shares (
Performance Shares) under the Brambles 2001 Executive Performance Share Plan (
Share Plan). The basis on which the grants are made will remain as outlined in
the Remuneration Report except that, in recognition of his new role, Mr Turner's
'LTIP Multiple' will be increased from 60% to 75%.

As has previously been the case, grants to Mr Turner will be calculated as
follows:

• The number of Options to be granted to Mr Turner each year
under the Option Plan will be determined by applying his LTIP Multiple to his
TFR, and dividing the result by the value of an Option under the Option Plan,
calculated using a Black Scholes method determined by external advisers.


• The number of Performance Shares to be granted to Mr Turner
each year will be determined by applying his LTIP Multiple to his TFR, and
dividing the result by the market value of a Brambles Industries Limited (BIL)
share as at the time of grant.


In recognition of his new role, a supplementary grant of Options and Performance
Shares has been made to Mr Turner as at 14 October 2003, bringing this year's
grants to Mr Turner into line with his new TFR. Under this supplementary grant,
Mr Turner has been granted Options over 665,398 BIL shares at an exercise price
of $4.66 per share and an award under the Performance Share Plan with respect to
183,776 BIL shares.

The Options may only be exercised if a performance hurdle based on relative
total shareholder return (TSR) is satisfied over the relevant performance
period. Under this performance hurdle, Brambles' TSR over the period is compared
to the TSR of a peer group of companies, consisting of the top 50 Australian
companies (by market value) and the FTSE100. No Options will vest unless
Brambles' TSR performance over that period is equal to or better than 50% of the
peer group of companies: at that level, 38% of the Options will vest. All the
Options will vest if Brambles' TSR performance is equal to or better than 75% of
the peer group, with straight line vesting between these two limits.

The Performance Shares will only be accessible if a performance hurdle based on
earnings per share (EPS) growth is satisfied over the relevant performance
period. No Performance Shares will be accessible unless Brambles' compound EPS
growth over that period is equal to or better than 7% per annum: at that level,
25% of the Performance Shares become accessible. All the Performance Shares will
be accessible if Brambles' compound EPS growth over that period is equal to or
better than 15% per annum, with straight line vesting between these two limits.

In the case of both the Options and Performance Shares, the performance hurdle
is tested over an initial period from the end of the financial year before the
date of the award to the third anniversary of that date. If not all the Options
or Performance Shares vest at that point, the performance hurdle will be
re-assessed after four, five and six years - with performance measured over the
entire four, five or six year period, as the case may be.

The Remuneration Report each year includes details of the number and value of
the Options and Performance Shares granted during the year.

5.         Termination and Entitlements

As noted above, the Service Contract may be terminated by Brambles without cause
on giving 12 months' notice and by Mr Turner without cause on giving six months'
notice. In certain circumstances, the Service Contract may also be terminated
for cause either without notice or on giving three months' notice, depending on
the circumstances.

Cash and other Benefits

If Mr Turner gives six months' notice of termination without cause, or if
Brambles gives 12 months' notice without cause, Brambles may at any time elect
to dispense with the balance of the notice period and bring forward the date of
termination. In such a situation, consistent with Brambles' obligations under
relevant Australian employment law:

(a)       Mr Turner will be entitled to a prompt payment on termination equal to
(i) where Mr Turner has given Brambles notice of termination, one half of his
annual TFR; and (ii) where Brambles has given Mr Turner notice of termination,
his annual TFR, less in each case any amounts paid to Mr Turner on account of
TFR for the relevant notice period; and

(b)       Mr Turner will be entitled to an STI payment, subject to the
achievement of the agreed targets, which will be paid at such time as STI
payments are made to other executives and pro-rated for the time employed in the
relevant financial year.

Mr Turner would also be entitled on termination to any accrued entitlements such
as earned but untaken annual leave and relocation expenses.

Options and Performance Shares

In an announcement dated 13 March 2003, we advised that the Board has determined
it will exercise its discretion under the terms of the Option Plan so as to
permit Mr Turner to exercise, following termination of his employment, all
Options granted to him prior to and including the 2003 grants within the
respective exercise periods, to the extent that the performance condition
relating to those Options has been satisfied. The Board had also determined that
it will exercise its discretion under the Share Plan so that, following
termination of Mr Turner's employment (a) all Performance Shares up to and
including the 2002 grant will vest to the extent that the performance condition
relating to that grant has been satisfied but will be subject to pro-rating by
reference to the proportion of the performance period during which he has been
employed; and (b) his 2003 grants will vest to the extent that the performance
conditions relating to those grants have been satisfied.

In the event of Mr Turner's resignation or termination by Brambles for any
reason other than for cause, the above arrangements will continue to apply.
However, any awards made after 31 December 2003 will be treated in accordance
with the rules of the 2001 Executive Share Option Plan and the 2001 Executive
Performance Share Plan rules or in accordance with the rules in existence at
that time.

Mitigation

Mr Turner will be required to mitigate loss on termination. This means that any
termination payments to be made to Mr Turner by Brambles will be reduced by the
amount of any benefits to be received under any new employment.



                      DAVID TURNER'S REMUNERATION FOR 2004

                                A WORKED EXAMPLE

Set out below is a worked example of the remuneration Mr Turner might receive in
2004 if he and Brambles performed to the 'target' level. To perform at that
level, the budget set by the Board at the beginning of the financial year would
need to be achieved and Mr Turner would need to meet his own rigorous personal
performance hurdles. The calculations below include notional values ascribed to
Options and Performance Shares, based on certain assumptions, details of which
are set out in the notes to the table.


Element                Total Fixed    'At risk'      Estimated total
---------------        Remuneration   remuneration   remuneration at target
                       (TFR)          at target      performance (TFR + 'at
                       -------------  performance    risk' remuneration at
                                      -------------  target performance)
                                                     -------------

Total Fixed                £963,800
Remuneration (TFR)      
(including base
salary, pension
contributions etc)

Short Term Incentive:

Cash Bonus at target                  £530,090 (note 1)  
Long Term Incentive
Plans:
(notional values)
Options                               £145,354 (note 2)
Performance Shares                    £100,319 (note 2)


               Total       £963,800   £775,763           £1,739,563


                       Fixed          Performance
                       Entitlements   Based
                       -------------  Remuneration
                                      -------------
Proportion of fixed    47% (note 3)   53% (note 3)
entitlements and       
performance based
remuneration
---------------


Important Notes:

1.         The actual STI payment made to the CEO in 2003 was £84k. This related
solely to achievements against personal objectives, with no payment on account
of financial performance. The figure in the above table assumes not only full
achievement of personal objectives but also the achievement of targeted
improvement in Brambles' PBTA in 2004.

2.         In line with the requirements of the Australian Securities &
Investments Commission, Brambles has adopted an approach to the valuation of
outstanding unvested equity based awards which was detailed in the 2003 Annual
Report. In summary, a modified Black Scholes model is applied to the awards. The
resulting value is then discounted by 60% to reflect the expected probability at
the time of grant of meeting the performance hurdles. The discounted value is
then equally allocated across the vesting period. The basis of, and assumptions
used in, these calculations is consistent with the approach adopted in the 2003
Annual Report and Accounts. They will however be reviewed in the context of the
2004 Annual Report and Accounts in light of applicable rules and practices at
that time. The numbers ultimately disclosed in the 2004 Report and Accounts may
therefore vary from those shown above.

3.         As outlined in the 2003 Remuneration Report, the proportions of
annual remuneration allocated to fixed entitlements and performance based
remuneration have been determined by considering only equity awards made during
the year, with the entire discounted notional value of those awards being
allocated to that one year.






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