PPP Contracts

SCHEDULE 3.2 - Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks

Reasonable Life Expectancy and Benchmarks

1.1A Infraco shall maintain, renew and manage the Assets so as to ensure they have a Reasonable Life Expectancy by no later than the end of the third Review Period. Reasonable Life Expectancy means that all Assets will be assessed as being within categories A-C in accordance with Standard E1501 and where no Condition Benchmarks or Residual Life Benchmarks are applicable to a class of Assets, the distribution of the Assets in each of categories A-C shall be in such proportions as would be achieved by an Infraco exercising Good Industry Practice taking into account the average life expectancy of such Assets.

1.1 Infraco shall maintain, renew and manage the Assets listed in Appendix 1 to this Schedule 3.2 so that on the dates specified in Appendix 1 the Assets comply with the Condition Benchmarks. Infraco shall measure the condition of the Assets in accordance with Appendix 1 to this Schedule 3.2.

1.2 Infraco shall maintain, renew and manage the Assets listed in Appendix 2 to this Schedule as a minimum so as to achieve the objectives outlined in paragraph 1 of Schedule 3.1, so that on the Expiry Date the Assets comply with the Residual Life Benchmarks. Infraco shall measure the residual life of the Assets in accordance with Appendix 2 to this Schedule 3.2.

Grey Assets

1.3 During the first Review Period, Infraco shall assess the condition of all Grey Assets in accordance with Appendix 1 to this Schedule 3.2. Subject to paragraph 1.4 below, during such Review Period Infraco shall maintain, renew and manage the Grey Assets in the asset condition category established by their first assessment.

1.4 Infraco shall notify LUL if any Grey Asset is found to be in Category E or otherwise in an unsafe condition. Without prejudice to Infraco's other obligations in relation to that Grey Asset ( including safety, asset management and the Infraco Obligations ) and otherwise subject to paragraph 1.4A, Infraco shall, at its cost, during the first Review Period ensure that such Grey Asset is and remains in a safe condition.

1.4A LUL may require Infraco ( provided that LUL complies with clause 17 ( LUL Specified Rights ) with respect thereto ) to carry out more extensive works to bring a Grey Asset into a condition to be specified by LUL.

1.5 In respect of Grey Assets, the obligation to comply with Condition Benchmarks contained in paragraph 1.1 of this Schedule 3.2 shall not apply on the First Review Date.

Reports

2 Infraco shall report on its progress towards meeting and achieving the Condition Benchmarks and Residual Life Benchmarks as contemplated by paragraphs 5 and 6 of Schedule 3.1.

Development of Measurement

3.1 The parties acknowledge that, in the interest of reducing the risks to safety and of service loss through deficiencies in asset management, development of condition and residual life measurement techniques provide benefits to be shared by both parties and shall therefore co-operate with each other in the development of such techniques.

3.2 During the first Review Period, the parties shall work together to improve current understanding and/or develop new condition, performance and residual life measurement processes to ensure that: (a) in relation to Assets and processes outlined in Appendix 1 of this Schedule 3.2, the condition measurement process accurately reflects the condition of the Assets;

(b) in relation to Assets and processes outlined in Appendix 2 of this Schedule 3.2, the residual life measurement process accurately reflects the residual life of the Assets; and

(c) in relation to Assets and processes outlined in Appendix 1 and Appendix 2 of this Schedule 3.2, over time Condition Benchmarks and Residual Life Benchmarks are improved as indicators of actual condition and/or no longer have to be specified in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1 because performance measurement adequately ensures that the obligations are complied with and the objectives are achieved.

3.3 In developing condition, performance and residual life measures, the parties shall take account of all relevant information available to them including, but not limited to: (a) the results of any inspection regime;

(b) the results of any condition surveys;

(c) any reports, modelling, analysis or knowledge development work by one of the parties or between the parties on performance, condition, residual life or otherwise;

(d) the discussions and any outcome of Joint Working Groups;

(e) technological advances;

(f) Good Industry Practice; and

(g) efficient and economic whole-life asset management.

Amending Benchmarks

4.1 If Infraco believes that as a result of information gained through the processes in paragraph 3 that an Asset or type of Asset no longer requires a Condition Benchmark or Residual Life Benchmark or requires a less onerous Condition Benchmark or Residual Life Benchmark, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, Infraco may give notice to LUL that it wishes Appendix 1 and/or Appendix 2 of this Schedule 3.2 to be amended giving reasons why Infraco believes that the Appendices should be so amended and the reasons given shall be considered by LUL.

4.2 If the parties are satisfied, acting reasonably ( as a result of an application by Infraco in accordance with paragraph 4.1 above or otherwise ) that it is unnecessary for an Asset in Appendix 1 of this Schedule 3.2 to meet the level or date of the Condition Benchmark or for an Asset in Appendix 2 of this Schedule 3.2 to meet the date or level of the Residual Life Benchmark set therein, or alternatively that a Condition Benchmark or Residual Life Benchmark is no longer required, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, the parties shall agree, taking account of any reasons that Infraco puts forward, to an amendment to Appendix 1 or Appendix 2 of this Schedule 3.2 and the relevant benchmark to provide for: (a) a lesser condition or residual life to be met;

(b) a later date to be specified for the Condition Benchmark or Residual Life Benchmark to be met; or

(c) the removal of the relevant benchmark and removal of the Asset from Appendix 1 or Appendix 2 of this Schedule 3.2, provided that prior to the removal of the relevant benchmark the parties agree appropriate arrangements to enable determination of Rectification Costs in respect of the Asset.

4.3 Save for any requirement at Law, in the Safety Agreement or any change at Periodic Review any amendment relating to: (a) an increase in the Condition Benchmark or Residual Life Benchmark to be met; or

(b) a reduction in the time in which a Condition Benchmark or Residual Life Benchmark is to be met, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, shall only be made in accordance with paragraph 6 below.

4.4 In relation to determining Condition Benchmarks, condition measures, Residual Life Benchmarks or residual life measures, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, the parties shall act reasonably and if one of the parties believes that the other party is not acting reasonably and as a result the parties are unable to agree, either party may refer the matter for resolution in accordance with the Dispute Resolution Agreement taking into account all relevant facts and circumstances including: (a) the results of any inspection regime;

(b) the results of any condition surveys;

(c) any reports, modelling, analysis or knowledge development work by one of the parties or between the parties on performance, condition, residual life or otherwise;

(d) the discussions and any outcome of Joint Working Groups;

(e) technological advances; and

(f) Good Industry Practice.

New and Replacement Assets

5.1 Infraco shall inform LUL if it intends to bring a New Asset or Replacement Asset into service.

5.2 In relation to New Assets the parties shall agree, acting reasonably, whether: (a) a Condition Benchmark or Residual Life Benchmark is required for that New Asset; and/or

(b) what measurement process is to be used for that New Asset, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1. If the parties agree what Condition Benchmark or Residual Life Benchmark is required, and the level of such Condition Benchmark or Residual Life Benchmark, or agree what other management process is to be used for the New Asset, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, then the New Asset shall have that Condition Benchmark, Residual Life Benchmark or measurement process attributed to it and the Appendices shall be amended accordingly.

5.3 The parties shall agree, acting reasonably, whether the Condition Benchmark, Residual Life Benchmark and any relevant measurement process required for an Asset in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1 which is being replaced is appropriate to be used for that Replacement Asset, in order to comply with such obligations and to achieve such objectives. If the parties agree that the Condition Benchmark, Residual Life Benchmark or measurement process is appropriate to be used for that Replacement Asset in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, then the Replacement Asset shall have that Condition Benchmark, Residual Life Benchmark or measurement process attributed to it. If the parties do not agree that the Condition Benchmark, Residual Life Benchmark or measurement process required for an Asset which is being replaced is appropriate in order to be used for that Replacement Asset in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, the parties shall agree, acting reasonably, what Condition Benchmark or Residual Life Benchmark should apply and the level of such Condition Benchmark, Residual Life Benchmark and, where applicable, the measurement process, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1. The Appendices shall be amended accordingly.

5.4 If the parties are unable to agree: (a) whether or not New Assets or Replacement Assets should have a Condition Benchmark or Residual Life Benchmark specified; or

(b) the measurement process to be used to measure and determine a Condition Benchmark or Residual Life Benchmark; or

(c) what a Condition Benchmark or Residual Life Benchmark should be, either party may refer the matter for resolution in accordance with the Dispute Resolution Agreement and whether or not a Condition Benchmark or Residual Life Benchmark is required and the level of such Condition Benchmark or Residual Life Benchmark, in order to comply with the obligations set out in paragraph 2 of Schedule 3.1 and to achieve the objectives set out in paragraph 1 of Schedule 3.1, shall be determined by taking into account evidence presented by both parties and Condition Benchmarks or Residual Life Benchmarks set on comparable or analogous Assets or types of Asset.

Failure to Comply with Benchmarks

6.1 If Infraco fails to meet any Condition Benchmark or Residual Life Benchmark by the relevant Review Date: (a) as a result of a Benchmark Disruption Event, the date on which LUL can exercise its rights under paragraph 6.2 below shall be set to such date as shall be agreed between the parties to allow Infraco a reasonable amount of time in which to meet the benchmark in question and if the parties are unable to agree a later date, either party may refer the matter for resolution in accordance with the Dispute Resolution Agreement; or

(b) for any reason other than that outlined in paragraph 6.1(a) above, LUL may ( but shall not be under any obligation to ) set the date on which LUL can exercise its rights under paragraph 6.2 below to any later date, either date in (a) or (b) above being the Withholding Date.

6.2 If Infraco fails to meet a Condition Benchmark or Residual Life Benchmark by whichever is the later of the relevant Review Date or ( if applicable ) Withholding Date, then LUL may, in its sole discretion: (a) change any future Condition Benchmark or Residual Life Benchmark in relation to the Asset or type of Asset in question to allow for:
(i) a reasonable increase in the Condition Benchmark or Residual Life Benchmark to be met; or

(ii) a reasonable reduction in the time in which a Condition Benchmark or Residual Life Benchmark is to be met; and/or
(b) each Payment Period withhold, an amount up to but not exceeding the lesser of:
(i) the amount which LUL reasonably considers to be equivalent to the cost of meeting the particular Condition Benchmark or Residual Life Benchmark divided by the number of Payment Periods LUL reasonably considers it will take Infraco to do so; or

(ii) ten per cent. ( 10% ) of the Baseline ISC per period,
from the Baseline ISC until Infraco meets the Condition Benchmark or Residual Life Benchmark. When Infraco meets the Condition Benchmark or Residual Life Benchmark, LUL shall pay Infraco the total amount formerly withheld from the Baseline ISC and resume payment to Infraco of the Baseline ISC to which Infraco would have been entitled had it met its Condition Benchmark or Residual Life Benchmark by the target date. PROVIDED THAT if Infraco fails to meet a Withholding Date as a result of a Benchmark Disruption Event the provision of paragraph 6.1 above shall apply mutatis mutandis.

6.3 If Infraco fails otherwise than as a result of the occurrence of a Force Majeure Event or LUL Breach to: (a) meet a Condition Benchmark or Residual Life Benchmark; or

(b) show that it is making such progress towards meeting a Condition Benchmark or Residual Life Benchmark that is satisfactory to LUL, acting reasonably, by the expiry of the sixth Payment Period from the revised date referred to in paragraph 6.1 ( or any further extension of a Withholding Date ), LUL may exercise its Step-in Rights in accordance with clause 23 ( LUL Step-in Rights ) of the Contract.

Expiry

7.1 During each Contract Year in the period from the final Periodic Review to the Expiry Date, Infraco shall include as part of its Annual Asset Management Plan asset condition targets to be met each year so as to ensure that Infraco will meet the Condition Benchmarks on the Expiry Date.

7.2 During each Contract Year in the period from the final Periodic Review to the Expiry Date, LUL shall be entitled to participate with Infraco in the annual assessment of Assets. If Infraco fails to meet the asset condition targets contained in its Annual Asset Management Plan in any Contract Year in such final Review Period and cannot demonstrate to LUL's reasonable satisfaction that it will meet the Condition Benchmarks on the Expiry Date, LUL may withhold during the following Contract Year, an amount up to but not exceeding the lesser of: (a) the amount which LUL reasonably considers to be equivalent to the cost of returning the assets to the level indicated in the targets contained in the then current Annual Asset Management Plan ( taking into account any sums still held by LUL which were deducted at the end of prior Contract Years ); or

(b) an amount equal to ten per cent. ( 10% ) of the aggregate Baseline ISC arising during such following Contract Year ( provided that no more than ten per cent. ( 10% ) of the Baseline ISC may be withheld in any Payment Period ), from the Baseline ISC until Infraco meets the asset condition targets contained in its Annual Asset Management Plan. When Infraco meets the asset condition targets, LUL shall pay to Infraco the total formerly withheld from the Baseline ISC and resume payment to Infraco of the Baseline ISC to which Infraco would have been entitled had it met its asset condition targets.

7.3 If the date for a Condition Benchmark in Appendix 1 of this Schedule 3.2 or Residual Life Benchmark in Appendix 2 of this Schedule 3.2, to be met is on the Expiry Date, and Infraco fails to meet that benchmark, Infraco shall compensate LUL in accordance with clause 42 ( Expiry ) of the Contract.

Appendix 1 - Condition Benchmarks

All Condition Benchmarks are established on the basis of the asset condition classification categories ( A-E, Grey ) as described in Category 1 Standard E1501. The Condition Benchmarks are set out as the minimum cumulative percentage of the total Modern Equivalent Asset Value of each type of Asset which should be in the specified condition category or a lower category ( provided that where a lower category has a zero percentage specified that no assets can appear in that category ).

All Asset values shall be measured by Infraco in accordance with this Schedule in order that the condition of Assets is determined on the date of the relevant Periodic Review.

Any amendments to be made to any of the Condition Benchmarks shall be made in accordance with Schedule 3.2 or on Periodic Review.

A Track
The Condition Benchmarks to be achieved for track in both open and tunnel are set out in Appendix 1A.

1. Track Support

Asset condition classification, as required by Standard E1501, shall be based on: (a) the current performance and attention rates ( as recorded in accordance with Standard E1114 )

(b) for wood sleepers, timbers and bearers, and test ratings ( as recorded in accordance with Standard E1114 ); and

(c) the justified expectation of future performance, based on demonstrated degradation rates. Due cognisance must be shown to have been taken of the ballast interactions with formation and drainage. Where future performance includes an allowance for in-situ ballast cleaning, its practicability and benefits must be demonstrated. In wood sleepers, Asset category A shall not be assigned to sleeper assets where more than 5% are awarded sleeper integrity test ratings 3 or 4. Asset category B shall not be assigned to sleeper assets where more than 5% are awarded sleeper integrity test ratings 3 or 4 and where borate rods or similar are not used or have been used at least twice.

The following asset characteristics, which may indicate incipient insidious degradation, shall be monitored and included in the relevant asset record maintained in accordance with Standard E1114. They should normally result in asset condition classification as Asset category D:

Standard E1501 Feature	Characteristic
Ballast	Ballast requiring three or more maintenance visits per year
Sleepers ( concrete )	Sleepers where ballast requires three or more maintenance visits per year
Sleepers ( concrete ), Sleepers & base concrete Station pit roads	Removal of rubber boots on concrete sleepers or blocks
Sleepers ( wood )	More than 5% with Sleeper Integrity Test rating 5 or 6
	Missing borate rods
Sleepers ( all forms ) P&C Turnouts	More than 5% of sleepers designed to be fitted with rail pads and/or clip insulators having either pads or insulators missing or with holes
	Additional intermediate sleepers or timbers, when more than 10% per 100m or per unit of S&C
	Use of gauge ties
Sleepers ( wood )	Gauge ( chair ) stops, unless recorded as provided at switches as part of the installation design
Sleepers & base concrete P&C Turnouts	Wood sleepers, timbers or bearers with unplugged screw or spike holes

These classifications will not apply where it can be demonstrated that performance ( including safety and environmental performance ) is maintained and there are long-term whole life cost savings.

2. Conductor Rails
Asset condition classification, as required by Standard E1501, shall be based on: (a) the current percentage of permissible section loss and wear, as recorded in accordance with Standard E1114, taking into account local loss of section owing to, for example, arc damage etc.;

(b) conductor rail conductivity, assessed in accordance with Standard E4112; and

(c) the justified expectation of future performance, based on demonstrated degradation rates. Notwithstanding any other criteria, conductor rail sections shall be deemed to be outside asset condition categories A, B and C if the resistivity exceeds the limits specified in Standard E4112. Allocation to categories D or E shall depend on the degree of exceedance, taken in conjunction with the overall condition.

3. Plain Line, Junctionwork, Running Rail Joint

Asset condition classification, as required by Standard E1501, shall be based on:- (a) the current percentage of permissible wear, as recorded in accordance with Standard E1114; and

(b) the justified expectation of future performance, based on demonstrated degradation rates. The possibility of turning or transposing rails may be taken into account for any rail asset which has been noted as suitable in the record kept in accordance with Standard E1114. Where such allowance for turning or transposition would indicate a longer residual life than that indicated by head wear, the latter criterion shall be the deciding factor, in respect of rail wear, when assigning the asset category to any section of rail.

The following asset characteristics, which may indicate incipient insidious degradation, shall be monitored and included in the relevant asset record maintained in accordance with Standard E1114.

Those normally requiring asset condition classification as asset condition Category D are:

Standard E1501 Feature	Characteristic
Rail (BH), Rail (FB),	Rail defect rate of 5/km ( or worse )
P&C Turnouts	Substitution of normal quality rail for wear resistant or other special steel rails
	More than one pair of shims per joint, or the use of shims thicker than N^o 11
Rail (BH),	Substitution of non-skirted fishplates for skirted fishplates
P&C Turnouts	Additional or vertical keys in chairs, when more than 5% per 100m or per unit of S&C
	Shimmed keys in chairs, when more than 10% per 100m
Rail (FB) P&C Turnouts	More than 5% of baseplates, per 100m or per unit of S&C, designed to be fitted with rail pads having pads missing or with holes
	Additional clips in baseplates, when more than 10% per 100m or per unit of S&C
Rail (BH), Rail (FB)	Additional nuts or washers on fishbolts, when more than 10% per 100m
	Use of rail anchors, unless recorded as provided as part of the installation design
P&C Turnouts	Substitution of fabricated crossings for semi-welded, cast or cast centre crossings
	Substitution of semi-welded crossings for cast or cast centre crossings
	Multi-grooved locking pins replaced by bolts, when more than 5% per unit
	Additional nuts or washers on crossing bolts, when more than 5% per unit
	Additional nuts or washers on switch ( stud ) bolts or crossing fishbolts
	Additional nuts or washers on fishbolts ( excluding crossing fishbolts ), when more than 5% per unit

Those normally resulting in asset condition classification as asset condition Category E are:

Standard E1501 Feature	Characteristic
Rail (BH), Rail (FB)	Unknown stress free temperatures of long or continuously welded rails
	Non-compliant stress free temperatures of long or continuously welded rails
Rail (BH), Rail (FB), P&C Turnouts	The subject if an increases frequency of ultrasonic testing in accordance with 7.6 (p8) of TE-IS-103, Ultrasonic Inspections The absence of a continuous stainless steel deposit over the whole length specified

These classifications will not apply where it can be demonstrated that performance ( including safety and environmental performance ) is maintained and there are long-term whole life cost savings.

B Earth Structures
The Condition Benchmarks to be achieved for earth structures are set out in Appendix 1B. The method for deriving the condition categories for the earth structures is given in engineering Standards including Standard E3735 and Standard P3740.

C Bridges and Structures
The Condition Benchmarks to be achieved for bridges and structures are set out in Appendix 1C.

The Asset condition classification, as required by Standard E1501 is based on concerns identified during the inspection and assessment processes.

D Track Drainage
The Condition Benchmarks to be achieved for track drainage are set out in Appendix 1D.

The track drainage condition is determined using data collected from the inspection and assessment regime described in Standard E3901 and Standard P3902. Procedure P3921 provides a list of track drainage concerns which broadly correlate with equivalent Standard E1501 condition categories.

Appendix 1A - Condition Benchmarks for Track

Metropolitan Line

Metropolitan - Open Sections

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	98	100	100
Sleepers ( concrete )	0	0	32	32	32
Rail	0	0	28	34	44
Ballast	0	0	28	34	44
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	42	54	56

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	98	100	100
Sleepers ( concrete )	0	0	16	16	16
Rail	0	0	11	22	32
Ballast	0	0	11	22	32
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	24	28	32

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	0	10	25
Ballast	0	0	0	10	25
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	2	17

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	10	20
Rail	0	0	0	16.5	33
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	16.5	33

All values in the tables are % MEAV

(1) May be present in small quantities by exception

Metropolitan - Sub-Surface Sections

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	50	50	50
Ballast	0	0	57	57	57
Conductor Rail	0	0	8	20	32
Switch and Crossing Work	0	0	0	25	50

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	100	100	100
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	0	17	50
Ballast	0	0	14	14	14
Conductor Rail	0	0	3	15	27
Switch and Crossing Work	0	0	0	25	50

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	12.5	25
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	0	29	58
Ballast	0	0	0	0	15
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	25	50

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	12.5	25
Sleepers ( concrete ) including slab track	0	0	0	10	20
Rail	0	0	0	29	58
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	25	50

All values in the tables are % MEAV

(1) May be present in small quantities by exception

Circle and Hammersmith & City Line

Circle and Hammersmith - Open Sections

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete )	0	0	47	47	47
Rail	0	0	64	64	64
Ballast	0	0	64	64	64
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	18	36	43

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	100	100	100
Sleepers ( concrete )	0	0	31	31	31
Rail	0	0	32	32	32
Ballast	0	0	32	32	32
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	9	17

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	0	3	14
Ballast	0	0	0	3	14
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	7	23

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	10	20
Rail	0	0	0	16.5	33
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	16.5	33

All values in the tables are % MEAV

(1) May be present in small quantities by exception

Circle and Hammersmith - Sub-Surface Sections

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	48	48	50
Ballast	0	0	63	63	63
Conductor Rail	0	0	8	20	32
Switch and Crossing Work	0	0	14	37	53

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	100	100	100
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	0	19	52
Ballast	0	0	28	28	30
Conductor Rail	0	0	2	14	26
Switch and Crossing Work	0	0	5	17	41

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	12.5	25
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	0	32	64
Ballast	0	0	0	2	14
Conductor Rail	0	0	0	12	24
Switch and Crossing Work	0	0	0	2	52

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	12.5	25
Sleepers ( concrete ) including slab track	0	0	0	10	20
Rail	0	0	0	29	58
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	25	50

All values in the tables are % MEAV

(1) May be present in small quantities by exception

District Line

District - Open Sections

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete )	0	0	2	2	2
Rail	0	0	64	64	66
Ballast	0	0	62	62	65
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	16	30	43

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	100	100	100
Sleepers ( concrete )	0	0	1	1	1
Rail	0	0	32	34	36
Ballast	0	0	31	34	37
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	13	26

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	0	2	13
Ballast	0	0	0	3	13
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	16.5	33

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	10	20
Rail	0	0	0	16.5	33
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	16.5	33

All values in the tables are % MEAV

(1) May be present in small quantities by exception

District Line - Sub-Surface Sections

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	38	39	60
Ballast	0	0	63	63	63
Conductor Rail	0	0	6	19	31
Switch and Crossing Work	0	0	7	29	49

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	100	100	100
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	0	31	67
Ballast	0	0	31	31	31
Conductor Rail	0	0	3	15	27
Switch and Crossing Work	0	0	0	30	50

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	12.5	25
Sleepers ( concrete ) including slab track	0	0	0	0	0
Rail	0	0	0	29	58
Ballast	0	0	0	0	13
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	25	50

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	12.5	25
Sleepers ( concrete ) including slab track	0	0	0	10	20
Rail	0	0	0	29	58
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	25	50

All values in the tables are % MEAV

(1) May be present in small quantities by exception

Piccadilly - Open Sections (SSL Management)

First Review Date Benchmark Values

For the avoidance of doubt, although no Assets are to remain unclassified by the First Review Date, as stated in paragraph 1.5 of Schedule 3.2 ( Reasonable Life Expectancy, Condition Benchmarks and Residual Life Benchmarks ), no Assets which were Grey Assets ( as defined ) are to be taken into account in determining these Benchmarks.

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	66	66	66
Ballast	0	0	66	66	66
Conductor Rail	0	0	4	16	28
Switch and Crossing Work	0	0	0	16.5	33

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	33	33	35
Ballast	0	0	33	33	34
Conductor Rail	0	0	1	13	25
Switch and Crossing Work	0	0	0	16.5	33

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	0	2	13
Ballast	0	0	0	1	12
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	16.5	33

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	10	20
Rail	0	0	0	16.5	33
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work	0	0	0	16.5	33

All values in the tables are % MEAV

Piccadilly - Sub-Surface Sections (SSL Management) (0.5 km)

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	100	100	100
Ballast	0	0	100	100	100
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work			NOT PRESENT

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )	0	0	100	100	100
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	100	100	100
Ballast	0	0	100	100	100
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work			NOT PRESENT

Third Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	0	0
Rail	0	0	0	16.5	33
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work			NOT PRESENT

Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Sleepers ( wood )⁽¹⁾	0	0	0	20	40
Sleepers ( concrete )	0	0	0	10	20
Rail	0	0	0	16.5	33
Ballast	0	0	0	16.5	33
Conductor Rail	0	0	0	12.5	25
Switch and Crossing Work			NOT PRESENT

All values in the tables are % MEAV

Appendix 1B - Condition Benchmarks for Earth Structures

District Line

Asset	Grey	E	D or worse	C or worse	B or worse
Cuttings	0	0	6	13	29
Embankments	0	0	8	21	31

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Cuttings	0	0	3	6	24
Embankments	0	0	4	11	22

Third Review Date and Expiry Date Benchmark Values ( Steady State )

Asset	Grey	E	D or worse	C or worse	B or worse
Cuttings	0	0	0	0	20
Embankments	0	0	0	0	12

All values in the tables are % MEAV

Metropolitan Line

Asset	Grey	E	D or worse	C or worse	B or worse
Cuttings	0	0	1	7	22
Embankments	0	0	4	17	33

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Cuttings	0	0	1	4	19
Embankments	0	0	2	9	23

Third Review Date and Expiry Date Benchmark Values ( Steady State )

Asset	Grey	E	D or worse	C or worse	B or worse
Cuttings	0	0	0	0	17
Embankments	0	0	0	0	12

All values in the tables are % MEAV

Appendix 1C - Condition Benchmarks for Bridges and Structures

District Line

Asset	Grey	E	D or worse	C or worse	B or worse
Overbridge	0	15	15	15	15
Underbridge	0	5	10	11	11
Viaduct	0	2	2	2	2
Covered Way	0	5	5	6	6
Girderings	0	4	4	5	5
Brick Tunnels	0	1	1	2	2
Stations	0	0	0	0	0
Subways	0	8	8	8	8
Footbridges	0	1	1	2	2
Ventilation Plant	0	0	0	2	2
Roof Structures	Included in station category
Retaining Walls	0	5	5	8	8

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Overbridge	0	6	6	6	7
Underbridge	0	7	7	7	8
Viaduct	0	7	7	7	9
Covered Way	0	7	7	7	8
Girderings	0	8	8	8	10
Brick Tunnels	0	1	1	1	2
Stations	0	10	10	10	13
Subways	0	8	8	8	10
Footbridges	0	4	4	4	5
Ventilation Plant	0	7	7	7	9
Roof Structures	Included in station category
Retaining Walls	0	5	5	5	6

Third Review Date and Expiry Date Benchmark Values ( Steady State )

Asset	Grey	E	D or worse	C or worse	B or worse
Overbridge	0	0	0	0	0
Underbridge	0	0	0	0	0
Viaduct	0	0	0	0	0
Covered Way	0	0	0	0	0
Girderings	0	0	0	0	0
Brick Tunnels	0	0	0	0	2
Stations	0	0	0	0	0
Subways	0	0	0	0	0
Footbridges	0	0	0	0	0
Ventilation Plant	0	0	0	0	0
Roof Structures	0	0	0	0	0
Retaining Walls	0	0	0	0	0

All values in the tables are % MEAV

Metropolitan & Circle Line

Asset	Grey	E	D or worse	C or worse	B or worse
Overbridge	0	19	19	20	20
Underbridge	0	7	7	7	7
Viaduct	0	1	1	1	1
Covered Way	0	2	2	3	3
Girderings	0	2	2	3	3
Brick Tunnels	0	3	3	5	5
Stations	0	1	1	1	1
Subways	0	2	2	2	2
Footbridges	0	1	1	1	1
Ventilation Plant	0	0	0	0	0
Roof Structures	Included in station category
Retaining Walls	0	1	1	1	1

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Overbridge	0	5	5	5	7
Underbridge	0	5	5	5	6
Viaduct	0	9	9	9	11
Covered Way	0	5	5	5	6
Girderings	0	8	8	8	10
Brick Tunnels	0	7	7	7	9
Stations	0	10	10	10	13
Subways	0	4	4	4	4
Footbridges	0	8	8	8	10
Ventilation Plant	0	10	10	10	13
Roof Structures	Included in station category
Retaining Walls	0	9	9	9	11

Third Review Date and Expiry Date Benchmark Values ( Steady State )

Asset	Grey	E	D or worse	C or worse	B or worse
Overbridge	0	0	0	0	0
Underbridge	0	0	0	0	0
Viaduct	0	0	0	0	0
Covered Way	0	0	0	0	0
Girderings	0	0	0	0	0
Brick Tunnels	0	0	0	0	2
Stations	0	0	0	0	0
Subways	0	0	0	0	0
Footbridges	0	0	0	0	0
Ventilation Plant	0	0	0	0	0
Roof Structures	0	0	0	0	0
Retaining Walls	0	0	0	0	0

All values in the tables are % MEAV

Appendix 1D - Condition Benchmarks for Track Drainage

District Line

Asset	Grey	E	D or worse	C or worse	B or worse
Track Drainage	0	0	16	16	28

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Track Drainage	0	0	8	8	25

Third Review Date and Expiry Date Benchmark Values ( Steady State )

Asset	Grey	E	D or worse	C or worse	B or worse
Track Drainage	0	0	0	0	23

All values in the tables are % MEAV

Metropolitan Line

Asset	Grey	E	D or worse	C or worse	B or worse
Track Drainage	0	0	21	21	32

Second Review Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Track Drainage	0	0	11	11	26

Third Review Date and Expiry Date Benchmark Values

Asset	Grey	E	D or worse	C or worse	B or worse
Track Drainage	0	0	0	0	20

All values in the tables are % MEAV

Appendix 2 - Residual Life Benchmarks

All Assets shall be measured by Infraco in accordance with this Schedule in order that the residual life of Assets is determined on the Expiry Date.

Any amendments to be made to any Benchmarks, shall be made in accordance with Schedule 3.2 or on Periodic Review.

1. Escalators (a) The Residual Life Benchmark for escalators is assessed on the nominal design life of forty (40) years for all escalators;

(b) on the Expiry Date, the escalator assets shall, on average, be no more than fifty per cent. ( 50% ) life expired; and

(c) on the Expiry Date, no more than five per cent. (5%) of the escalator assets will be nominally life expired. Infraco shall demonstrate the expected life of newly installed escalators and shall also propose a method for demonstration of the escalator residual lives at reversion. The proposed method of demonstrating residual life may include some combination of the following factors: age; wear; structural integrity; maintenance; availability and reliability records and number of refurbishments.

2. Rolling Stock (a) The nominal design life for all new Rolling Stock shall be forty (40) years;

(b) the nominal design life for all new internal refurbishments shall be twenty (20) years;

(c) on the Expiry Date, the Rolling Stock asset of Infraco shall on average, be no more than forty nine per cent. ( 49% ) life expired; and

(d) on the Expiry Date, each Rolling Stock asset of Infraco shall have a residual life of no less than five (5) years. Infraco shall demonstrate the expected life of new Rolling Stock and shall also propose a method for demonstration of the residual lives at reversion. The proposed method of demonstrating residual life may include a combination of the following factors: age; wear; structural integrity; maintenance; availability and reliability records and number of refurbishments.

3. Signalling - Train Control Systems
Infraco shall demonstrate that the train control systems will be fit-for-purpose on the Expiry Date and in an overall condition so as to sustain functionality and operability for a further ten (10) years. In particular, Infraco shall ensure, where necessary, any knowledge, skills, and access to third party support, shall be transferred across to LUL on reversion. Where hardware has an expected life significantly lower than ten (10) years Infraco shall provide a demonstrable upgrade path prior to the Expiry Date.

4. Communications
On the Expiry Date, the Communications Assets shall have a residual life of no less than four (4) years.

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