Result of AGM

BAE SYSTEMS PLC
29 April 2003

BAE SYSTEMS plc



POLL RESULTS TABLE FOR AGM 2003

All resolutions were passed:


RESOLUTION                                             VOTES         VOTES AGAINST       SHARES TOTAL
                                                        FOR
1       Accounts & Reports                        1,400,310,240           730,564        1,401,040,804
2       Directors' Remuneration Report              711,696,994       693,933,826        1,405,630,820
3       Final Dividend                            1,406,073,336           165,383        1,406,238,719
4       Professor Susan Birley                    1,393,171,138        12,903,856        1,406,074,994
5       Michael Lester                            1,394,915,555        11,157,057        1,406,072,612
6       Christopher Geoghegan                     1,394,484,036        11,586,103        1,406,070,139
7       Sir Peter Mason                           1,397,026,295         9,042,263        1,406,068,558
8       Rt Hon Michael Portillo                   1,395,136,429        10,919,340        1,406,055,769
9       Mark Ronald                               1,394,386,874        11,681,373        1,406,068,247
10      Reappointment of Auditors                 1,374,728,934        31,579,701        1,406,308,635
11      Auditors' Remuneration                    1,393,598,633        12,480,104        1,406,078,737
12      Authority to purchase shares*             1,405,428,362           813,313        1,406,241,675

* Special resolution



NOTES ON RESOLUTION 2 - Directors' Remuneration Report

The Company, noting the number of votes against 'Resolution 2: Approval of the
Directors' Remuneration Report' made the following comments during the AGM:

  • No new long-term remuneration plans are proposed at today's AGM, and there
    are no changes proposed to the basic remuneration policy. All the long-term
    plans in the Remuneration Report have previously been voted on and approved
    by shareholders.


  • The company received overwhelming support from our UK shareholders for
    Resolution 2. Following their analysis of the Remuneration report, both the
    Association of British Insurers and National Association of Pension Funds,
    UK institutional shareholder advisory groups, raised no concerns with the
    report.

  • The overwhelming majority of the ordinary shares voted against Resolution
    2 are controlled by US institutions.

  • It appears that many of these US institutions were influenced by a
    recommendation from a US-based proxy analysis firm, Institutional
    Shareholder Services (ISS), who recommended that their subscribers vote for
    all other Resolutions, but against Resolution 2.


  • ISS's objection centres on share plans available to our employees,
    including directors. ISS uses its own proprietary binomial methodology to
    estimate the effect of such plans relative to an 'allowable cap' for
    industry groups, a cap they define. Their objection in BAE SYSTEMS' case is
    they estimate that between now and 2012 the total shares that could go to
    our employees under the current share plans will exceed a target value
    defined by their proprietary process. However, their report accurately shows
    that 93% of share options issued to date have gone to employees other than
    directors.


  • BAE SYSTEMS' share plans are, by design, fully compliant with the
    guidelines set forth by the ABI and NAPF.


  • The dialogue with ISS and our US shareholders will continue in order to
    fully understand their concerns surrounding these plans since they affect
    such a large number of our employees.


29 April 2003






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