Exhibit 4(a)(ix) 


	
  

 	
  

 	
  

 
	
 DATED 3 November
 2009

 
	
  

 
	
 THE LORDS COMMISSIONERS OF HER MAJESTY’S TREASURY

 
	
  

 
	
 and

 
	
  

 
	
 LLOYDS BANKING GROUP PLC

 
	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 DEED OF WITHDRAWAL

 	
  

 
	
  

 	
 relating to the UK Asset

 	
  

 
	
  

 	
 Protection Scheme

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	

 


 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 Slaughter and May

 	
  

 
	
  

 	
 One Bunhill Row

 	
  

 
	
  

 	
 London - EC1Y 8YY

 	
  

 
	
  

 	
 (TP/JGZW)

 	
  

 
	
  

 	
 CA093050005

 	
  

 









CONTENTS


	
  

 	
  

 	
  

 	
  

 	
  

 
	
 1.

 	
  

 	
 DEFINITIONS
 AND INTERPRETATION

 	
  

 	
 5 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 2.

 	
  

 	
 CONDITIONS
 AND EFFECTIVENESS

 	
  

 	
 7 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 3.

 	
  

 	
 WITHDRAWAL;
 WITHDRAWAL FEE

 	
  

 	
 7 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 4.

 	
  

 	
 STATE AID
 COMMITMENTS; CO-OPERATION

 	
  

 	
 8 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 5.

 	
  

 	
 REMUNERATION

 	
  

 	
 9 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 6.

 	
  

 	
 LENDING
 COMMITMENTS

 	
  

 	
 9 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 7.

 	
  

 	
 NATIONAL
 INVESTMENT CORPORATION

 	
  

 	
 10 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 8.

 	
  

 	
 PRE-ACCESSION
 COMMITMENTS

 	
  

 	
 10 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 9.

 	
  

 	
 PUBLIC
 DISCLOSURE

 	
  

 	
 10 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 10.

 	
  

 	
 FUNDING
 ACTIONS

 	
  

 	
 11 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 11.

 	
  

 	
 BANK CHARGES

 	
  

 	
 11

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 12.

 	
  

 	
 WARRANTIES

 	
  

 	
 12 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 13.

 	
  

 	
 RECOVERY OF
 STATE AID

 	
  

 	
 12 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 14.

 	
  

 	
 PAYMENTS

 	
  

 	
 13

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 15.

 	
  

 	
 TAX MATTERS

 	
  

 	
 13 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 16.

 	
  

 	
 ANNOUNCEMENTS
 AND PUBLICITY

 	
  

 	
 14 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 17.

 	
  

 	
 CONFIDENTIALITY;
 FREEDOM OF INFORMATION

 	
  

 	
 15 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 18.

 	
  

 	
 ASSIGNMENT

 	
  

 	
 18 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 19.

 	
  

 	
 REMEDIES

 	
  

 	
 19

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 20.

 	
  

 	
 FURTHER
 ASSURANCE

 	
  

 	
 19

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 21.

 	
  

 	
 INVALIDITY

 	
  

 	
 20 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 22.

 	
  

 	
 NOTICES

 	
  

 	
 20

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 23.

 	
  

 	
 CONTRACTS
 (RIGHTS OF THIRD PARTIES) ACT 1999

 	
  

 	
 21 

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 24.

 	
  

 	
 COUNTERPARTS

 	
  

 	
 21 

 
	
  

 	
  

 	
  

 	
  

 	
  

 









3


	
  

 	
  

 	
  

 	
  

 	
  

 
	
 25.

 	
  

 	
 VARIATION

 	
  

 	
 21

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 26.

 	
  

 	
 AGENT FOR SERVICE OF PROCESS

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 27.

 	
  

 	
 GOVERNING LAW

 	
  

 	
 22

 
	
  

 	
  

 	
  

 	
  

 	
  

 
	
 28.

 	
  

 	
 JURISDICTION

 	
  

 	
 22
 

 









THIS DEED OF WITHDRAWAL
is made on 3 November 2009 


BETWEEN: 


	
  

 	
  

 
	
 (1)

 	
 THE LORDS COMMISSIONERS OF HER MAJESTY’S TREASURY
 of 1 Horse Guards Road, London SW1A 2HQ (the “Treasury”); and 

 
	
  

 	
  

 
	
 (2)

 	
 LLOYDS BANKING GROUP PLC, a public company
 incorporated in Scotland with registered number 095000 and whose registered
 office is at Henry Duncan House, 120 George Street, Edinburgh, Scotland EH2
 4LH (“LBG”). 

 
	
  

 	
  

 
	
 WHEREAS: 

 
	
  

 
	
 (A)

 	
 On 19
 January 2009, Her Majesty’s Government of the United Kingdom (the “Government”) announced its intention to
 offer the Asset Protection Scheme (the “Scheme”)
 to protect certain eligible financial institutions against exceptional future
 credit losses on certain portfolios of assets and exposures. 

 
	
  

 	
  

 
	
 (B)

 	
 On 7 March
 2009, LBG announced its intention to participate in the Scheme and entered
 into discussions with the Treasury regarding the terms of the Scheme and the
 accession of Bank of Scotland plc to it. 

 
	
  

 	
  

 
	
 (C)

 	
 LBG entered into:
 (i) a Pre-Accession Commitments Deed Poll on 7 March 2009 in which it made
 certain undertakings to the Treasury in connection with its proposed
 participation in the Scheme; and (ii) a Lending Commitments Deed Poll on 6
 March 2009 in which it made certain undertakings to the Treasury, the
 Department for Business, Enterprise and Regulatory Reform (now the Department
 for Business, Innovation and Skills) and the Department for Communities and
 Local Government in
 connection with its participation in the credit guarantee scheme
 announced by the Government on 8 October 2008 and its proposed participation
 in the Scheme. 

 
	
  

 	
  

 
	
 (D)

 	
 On 3
 November 2009, LBG announced its intention not to participate in the Scheme. 

 
	
  

 	
  

 
	
 (E)

 	
 LBG intends
 to effect the Rights Issue in lieu of its proposed participation in
 the Scheme and wishes to withdraw from its proposed participation in the
 Scheme. The implementation of the Rights Issue is to be conditional on the
 approval by LBG’s shareholders of the Withdrawal Resolution. 

 
	
  

 	
  

 
	
 (F)

 	
 The
 commitments and undertakings contained in this Deed (including with respect
 to the Withdrawal Fee) incorporate commitments from LBG to the Treasury that
 are designed to ensure that the Treasury is able to comply with the
 commitments or conditions (the “State Aid
 Conditions”) subject to which the European Commission has approved
 (or it is anticipated will approve) the aid provided by the Treasury to LBG:
 (i) under the recapitalisation scheme announced by the Government on 8
 October 2008; (ii) in connection with LBG’s (or a member of the Group’s)
 proposed participation in the Scheme; and (iii) in connection with the Rights
 Issue (together, the “State Aid”)
 as aid compatible with article 87 of the EC Treaty. 

 









5


NOW THIS DEED WITNESSES AS FOLLOWS: 


	
  

 	
  

 
	
 1.

 	
 DEFINITIONS
 AND INTERPRETATION 

 
	
  

 	
  

 
	
 1.1

 	
 In this Deed (including the
 Recitals): 

 
	
  

 	
  

 
	
  

 	
  “Authority” means: (i) any government; (ii) any
 governmental or quasi-governmental authority, body, agency or association;
 (iii) any supranational, federal, state or local government; (iv) any
 statutory or regulatory body, agency or association; (v) any body, agency or
 association having the power to impose, collect or administer any Tax; and
 (vi) any court, tribunal or other judicial body;

 
	
  

 	
  

 
	
  

 	
  “Business
 Day” means a day (other
 than a Saturday or a Sunday) on which banks are open for business in London;

 
	
  

 	
  

 
	
  

 	
  “Circular”
 means the
 shareholder circular to be published in connection with, amongst other
 things, the Rights Issue in accordance with the Listing Rules;

 
	
  

 	
  

 
	
  

 	
  “Conditions” has the meaning given in clause 2.2;

 
	
  

 	
  

 
	
  

 	
  “EC
 Treaty” means the
 consolidated version of the Treaty establishing the European Community;

 
	
  

 	
  

 
	
  

 	
  “FSA” means the Financial Services Authority
 including when acting in its capacity as the competent authority for the
 purposes of Part VI of the FSMA (and any successor authority);

 
	
  

 	
  

 
	
  

 	
  “FSMA” means the Financial Services and Markets
 Act 2000;

 
	
  

 	
  

 
	
  

 	
  “Group” means LBG and all of its group undertakings
 (as defined in section 1161(5) of the Companies Act 2006);

 
	
  

 	
  

 
	
  

 	
  “Lending
 Commitments Deed Poll”
 means the document entitled “Lending Commitments” referred to in Recital
 (C)(ii) above;

 
	
  

 	
  

 
	
  

 	
  “Listing
 Rules” means the
 listing rules made by the FSA under Part VI of the FSMA;

 
	
  

 	
  

 
	
  

 	
  “OFT” means the Office of Fair Trading (and any
 successor authority);

 
	
  

 	
  

 
	
  

 	
  “Pre-Accession
 Commitments Deed Poll”
 means the document entitled “Asset Protection Scheme: Pre-Accession
 Commitments” referred to in Recital (C) (i) above;

 
	
  

 	
  

 
	
  

 	
  “Proceedings” means any proceeding, suit or action
 arising out of or in connection with this Deed, whether contractual or
 non-contractual;

 
	
  

 	
  

 
	
  

 	
  “Representatives” means: (i) in the context of the Treasury,
 the Treasury Solicitor, any of Her Majesty’s Secretaries of State (and any
 other Minister of the Crown), UK Financial Investments Limited, the Asset
 Protection Agency, and any and all directors,

 









6


	
  

 	
  

 	
  

 
	
  

 	
 officers,
 officials, employees, agents, professional advisers and contractors of the
 foregoing; and (ii)
 in the context of LBG and the Group, directors, officers, employees,
 agents, professional advisers and contractors;

 
	
  

 	
  

 
	
  

 	
 “Rights Issue” means the rights issue of up
 to 90,000,000,000 new ordinary shares in LBG expected to be announced on or
 about the date of this Deed;

 
	
  

 	
  

 
	
  

 	
  “Scheme” has the meaning given to it in Recital
 (A);

 
	
  

 	
  

 
	
  

 	
  “Service Document” means a claim form,
 application notice, order, judgment or other document relating to any
 Proceedings;

 
	
  

 	
  

 
	
  

 	
  “State Aid” has the meaning given to it in
 Recital (F);

 
	
  

 	
  

 
	
  

 	
  “State Aid Approval” means any state aid
 approval for the State Aid in its original terms, as supplemented, modified
 or replaced subject to and in accordance with this Deed;

 
	
  

 	
  

 
	
  

 	
  “State Aid Commitments” means: (i) the
 commitments set out in the paper entitled “State Aid Commitments” as
 initialled by or on behalf of both the Treasury and LBG on or before the date
 of this Deed; and (ii) such
 other commitments given by LBG to the European Commission in connection with
 the State Aid Approval, each as supplemented, modified or replaced from time
 to time subject to and in accordance with this Deed;

 
	
  

 	
  

 
	
  

 	
  “State Aid Conditions” has the meaning given
 to it in Recital (F);

 
	
  

 	
  

 
	
  

 	
  “Tax” means any tax and any levy, impost,
 duty or other charge in the nature of taxation (whether of the United Kingdom
 or elsewhere in the world) and any fine, penalty, charge, cost or interest
 relating to any of the foregoing;

 
	
  

 	
  

 
	
  

 	
  “Treasury Solicitor” means the Solicitor for
 the Affairs of Her Majesty’s Treasury;

 
	
  

 	
  

 
	
  

 	
  “Withdrawal Fee” has the meaning given to it
 in clause 3;

 
	
  

 	
  

 
	
  

 	
  “Withdrawal Resolution” means resolution 4,
 as set out in the notice of general meeting of LBG contained in the Circular,
 to approve (amongst other things) the payment of the Withdrawal Fee to the
 Treasury; and

 
	
  

 	
  

 
	
  

 	
  “Working Hours” means 9.30 a.m. to 5.30 p.m.
 on a Business Day.

 
	
  

 	
  

 
	
 1.2

 	
 In this
 Deed, unless otherwise specified: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 references
 to clauses and paragraphs are to clauses and paragraphs of this Deed; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 the State
 Aid Commitments, the Remuneration Commitments (as defined in clause 5.1) and
 the Customer Charter (as defined in clause 6.3) form part of this 

 









7


	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Deed and
 shall have the same force and effect as if expressly set out in the body of
 this Deed, and references to this Deed shall include those documents;

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 the words “include” and “including” shall be deemed to be followed by the phrase
 “without limitation”; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (D)

 	
 headings and
 sub-headings in this Deed are included for ease of reference only and shall
 not affect the interpretation of this Deed; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (E)

 	
 any
 reference to a “person” shall be
 construed so as to include any individual, firm, company, corporation, body
 corporate, government, state or agency of a state, local or municipal
 authority or governmental body or any joint venture, association or
 partnership (whether or not having separate legal personality); 

 
	
  

 	
  

 	
  

 
	
  

 	
 (F)

 	
 any
 reference to any statute, statutory provision or rules or regulations made
 thereunder shall be construed as a reference to the same as it may have been,
 or may from time to time be, amended, modified, re-enacted or replaced; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (G)

 	
 a reference
 to any other document is a reference to that other document as amended,
 varied or supplemented at any time. 

 
	
  

 	
  

 	
  

 
	
 1.3

 	
 This Deed is
 being entered into, amongst other things, in order to implement the State Aid
 Conditions. If there is: (i) any ambiguity or inconsistency in the provisions
 of this Deed; or (ii) any dispute as to the interpretation or intended effect
 of this Deed or any provision contained in it, such ambiguity, inconsistency
 or dispute shall be resolved, to the extent possible, by reference to the
 terms of the State Aid Approval. 

 
	
  

 	
  

 
	
 2.

 	
 CONDITIONS AND EFFECTIVENESS 

 
	
  

 	
  

 
	
 2.1

 	
 Subject to
 clause 2.2, all provisions of this Deed shall have full force and effect upon
 execution and delivery of this Deed by the parties to it. 

 
	
  

 	
  

 
	
 2.2

 	
 Clauses 3.2,
 3. 3 and 4.2 are in all respects conditional on the satisfaction of the
 following conditions: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 approval by
 the shareholders of LBG of the Withdrawal Resolution (the “Shareholder Approval CP”); and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 the State
 Aid Approval having been obtained (the “State Aid CP” and, together with the Shareholder
 Approval CP, the “Conditions”). 

 
	
  

 	
  

 	
  

 
	
 3.

 	
 WITHDRAWAL; WITHDRAWAL FEE 

 
	
  

 	
  

 
	
 3.1

 	
 LBG
 acknowledges and agrees that the Treasury shall have no responsibilities,
 duties, obligations or liabilities to LBG (or any member of the Group) under
 or in connection with: (i) the Scheme; or (ii) the withdrawal of LBG (or any
 member of the Group) from its proposed participation in the Scheme, in either
 case whether in contract, tort (including negligence or breach of statutory
 duty) or otherwise. 

 









8


	
  

 	
  

 	
  

 	
  

 
	
 3.2

 	
 LBG
 undertakes to pay (or procure that a member of the Group pays) a fee to the
 Treasury of £2.5 billion (the “Withdrawal Fee”) for the benefits to the
 Group’s trading operations arising as a result of the Treasury proposing to
 make the Scheme available to LBG (or a member of the Group). 

 
	
  

 	
  

 
	
 3.3

 	
 The
 Withdrawal Fee shall be payable within five Business Days of the date on
 which the last of the Conditions is satisfied. 

 
	
  

 	
  

 
	
 4.

 	
 STATE AID COMMITMENTS; CO-OPERATION 

 
	
  

 	
  

 
	
 4.1

 	
 The
 Treasury: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 confirms
 that it has not submitted to the European Commission a restructuring plan or
 any commitments in relation to the State Aid that are significantly more
 onerous for LBG than the State Aid Commitments (as contained in the paper
 referred to in the definition of that expression) or in any other
 restructuring plan or submission prepared by or on behalf of LBG that the
 Treasury has forwarded to the European Commission; and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 undertakes
 that it will not submit any such restructuring plan or commitments without
 first discussing the corresponding submission in good faith with LBG. 

 
	
  

 	
  

 	
  

 	
  

 
	
 4.2

 	
 Save to the
 extent that the State Aid Approval has been annulled or suspended by the
 Court of First Instance or the European Court of Justice, LBG undertakes to
 do all acts and things necessary to ensure that the Treasury is able to
 comply with the State Aid Approval, including: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 complying
 (or procuring compliance) with the State Aid Commitments; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 complying
 with (or procuring compliance with) the terms of any restructuring plan
 submitted to and accepted by the European Commission in connection with the
 State Aid Approval and the State Aid Commitments; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 promptly
 complying with (or procuring compliance with) any and all requests from the
 Treasury for information, documentation or explanations, and doing all such
 other acts and things requested in writing by the Treasury, which are in the
 Treasury’s opinion (acting reasonably): 

 
	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 required in
 order to enable the Treasury or the European Commission to monitor compliance
 with the State Aid Approval or this Deed; or 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 required to
 respond to requests for information, documentation or explanations from the
 European Commission in relation to the State Aid Approval or monitoring
 compliance with the State Aid Approval. 

 










9


	
  

 	
  

 
	
 5.

 	
 REMUNERATION 

 
	
  

 	
  

 
	
 5.1

 	
 LBG
 undertakes to comply (or procure compliance) with the remuneration
 constraints and requirements (for 2009)***1 (the “Remuneration Commitments”).
 

 
	
  

 	
  

 
	
 5.2

 	
 LBG acknowledges
 its commitment to the principle that, from 2010, it should be at the leading
 edge of implementing the G20 principles, the FSA Remuneration Code and any
 remuneration provisions accepted by the Government from the Walker Review,
 and that UK Financial Investments Limited, on the Government’s behalf, will
 engage in proactive consultations with LBG’s board of directors to ensure
 that these future remuneration arrangements reflect a rigorous assessment of
 LBG’s performance and support the creation of sustainable value for
 shareholders (including UK Financial Investments Limited), provided that this
 principle shall always be applied in such a way as to allow LBG to operate on
 a level playing field with its competitors. 

 
	
  

 	
  

 
	
 5.3

 	
 For the
 purpose of clause 5.2, “FSA Remuneration
 Code” means the Remuneration Code of the FSA as published and
 defined in the FSA’s Senior Management Arrangements, Systems and Controls
 (Remuneration Code) Instrument 2009 (FSA 2009/48), or
 any supplementary, replacement or successor code for remuneration policies
 and practices relating to banking institutions as may be published by the FSA
 from time to time, whether constituted by rules, guidance or other regulatory
 provisions made by the FSA or otherwise, provided such supplementary,
 replacement or successor code applies to both LBG and its competitors. 

 
	
  

 	
  

 
	
 6.

 	
 LENDING COMMITMENTS 

 
	
  

 	
  

 
	
 6.1

 	
 In
 accordance with paragraph 12.6 of the Lending Commitments Deed Poll the
 following sub-paragraphs of paragraph 6 of the Lending Commitments Deed Poll
 are hereby deleted: 

 
	
  

 	
  

 
	
  

 	
 “The
 Participating Institution will comply with the Lending Commitments in
 accordance with the provisions of this Deed Poll on the understanding that:
 (i) the Schemes will be established by the Government; and (ii) the Participating
 Institution will participate in either or both of the Schemes on terms to be
 agreed with the Government. It is understood that the Government will, in
 consultation with the Participating Institution and acting reasonably, make
 an appropriate Commitment Adjustment if the APS is not implemented within the
 timeframes anticipated for such implementation; and that if the APS is not
 implemented within the timeframes anticipated for such implementation and the
 Participating Institution only participates in the CGS, that the Government
 will, in consultation with the Participating Institution and acting
 reasonably, make an appropriate Commitment Adjustment having regard to the
 quantum of financial support being provided by the Government to the
 Participating Institution pursuant to the CGS.

 
	
  

 	
  

 
	
  

 	
 If any
 preference shares held by the Treasury in the capital of the Participating
 Institution are exchanged for ordinary shares, the Participating Institution
 agrees that it shall increase the lending being made available to support
 creditworthy borrowers in the

 



 

	 
	 

	

    
	1 
	*** Indicates omission of material which has been separately filed pursuant to a request for confidential treatment.










10


	
  

 	
  

 
	
  

 	
 real
 economy. The quantum of such increased lending shall be determined by
 reference to the increased lending capacity of the Participating Institution
 after taking account of the long term effects of the exchange of the preference shares. Such increased lending
 will take account of demand for business and residential mortgage lending at
 the Participating Institution’s prevailing terms and conditions, including
 pricing, and risk assessment; and, additionally, any increased residential
 mortgage lending will be subject to the applicants meeting the Participating
 Institution’s standard credit and other acceptance criteria.”.

 
	
  

 	
  

 
	
 6.2

 	
 Subject to
 clause 6.1, the provisions of the Lending Commitments Deed Poll shall in all
 other respects remain unamended and in full force and effect, notwithstanding LBG’s withdrawal
 from the Scheme. 

 
	
  

 	
  

 
	
 6.3

 	
 LBG
 undertakes to implement (by no later than 27 November 2009) the customer
 charter for lending to businesses in the United Kingdom in the form agreed
 with the Treasury. The customer charter is set out in the paper entitled
 “Customer Charter for Lending to Businesses” as initialled by or on behalf of
 both the Treasury and LBG on or before the date of this Deed (the “Customer Charter”). 

 
	
  

 	
  

 
	
 7.

 	
 NATIONAL INVESTMENT CORPORATION 

 
	
  

 	
  

 
	
 7.1

 	
 LBG
 undertakes to contribute to a fund managed by the National Investment
 Corporation (“NIC”) the lower
 of: (i) £100mn (one hundred million pounds); and (ii) such amount as equals
 10% of the total sums invested in such fund.

 
	
  

 	
  

 
	
 7.2

 	
 Any amount
 contributed by LBG to NIC in the “2009 commitment period” or the “2010
 commitment period” (each as defined in the Lending Commitments Deed Poll)
 shall be deemed to constitute “lending” for the purposes of the Business
 Lending Commitments (as defined in the Lending Commitments Deed Poll). 

 
	
  

 	
  

 
	
 8.

 	
 PRE-ACCESSION COMMITMENTS 

 
	
  

 	
  

 
	
  

 	
 The
 Pre-Accession Commitments Deed Poll is hereby terminated, with the exception
 of paragraph 9 thereof (and any interpretation provisions necessary for its
 construction).

 
	
  

 	
  

 
	
 9.

 	
 PUBLIC DISCLOSURE 

 
	
  

 	
  

 
	
 9.1

 	
 LBG shall
 ensure that any public financial statements published by it or any other bank
 in the Group shall: (i) comply with Best Industry Practice in relation to the
 public financial statements of banking institutions; and (ii) implement and
 be consistent with any code or statement of best practice on public
 disclosure for authorised deposit-takers and other banking institutions that
 may be published by the FSA from time to time. 

 
	
  

 	
  

 
	
 9.2

 	
 LBG shall
 enter into discussions with the Treasury, each acting in good faith, for the
 purposes of establishing whether and in what way processes and procedures can
 be developed in relation to the public financial statements of banking
 institutions to ensure that such public financial statements, so far as
 possible: 

 









11


	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (A)

 	
 enable
 investors to assess: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 the quality
 of the assets and liabilities of banking institutions and their groups; 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 the
 financial position and performance of banking institutions and their groups;
 and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (iii)

 	
 the nature
 and extent of risks arising from financial instruments to which banking
 institutions and their groups are exposed and the manner in which such risks
 are managed; and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 are
 comparable as between similar banking institutions. 

 
	
  

 	
  

 	
  

 
	
 9.3

 	
 For the
 purpose of clause 9.1, “Best Industry Practice” means
 the level of skill, care, diligence, prudence, foresight, expertise and
 experience consistent with the standards which would ordinarily be adhered to
 by a prudent banking institution in the ordinary course of its business,
 taking account of: (A) applicable corporate governance and corporate
 responsibility principles; (B) any published guidance or recommendations
 (including guidance or recommendations from any Authority in the United
 Kingdom) relating to good industry practice in the banking and financial
 sectors as may be published from time to time; and (C) other guidelines,
 recommendations, methods, practices or procedures which would be adopted or
 complied with from time to time by a prudent banking institution in the
 ordinary course of its business. 

 
	
  

 	
  

 
	
 10.

 	
 FUNDING ACTIONS 

 
	
  

 	
  

 
	
 10.1

 	
 LBG
 undertakes to implement, and give effect to, a detailed medium term funding
 plan agreed, or to be agreed, with the FSA (the “Funding Plan”) and acknowledges that the Funding Plan shall
 reflect funding actions agreed with the FSA on or prior to the date of this
 Deed.

 
	
  

 	
  

 
	
 10.2

 	
 LBG
 acknowledges and agrees that compliance with the Funding Plan will be
 monitored by the FSA through its close and continuous supervisory
 relationship with the Group and through regular regulatory reporting
 requirements to be determined by the FSA in consultation with LBG.

 
	
  

 	
  

 
	
 11.

 	
 BANK CHARGES 

 
	
  

 	
  

 
	
  

 	
 LBG
 undertakes, in relation to personal current accounts (“PCAs”) provided by LBG or any member of
 the Group to: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 implement in
 full any agreements that the OFT may make with the banking industry as
 detailed in the OFT’s report – “Personal current accounts in the UK  – A follow
 up report, October 2009”, relating to the transparency of costs to consumers
 and the process of switching accounts to another bank and, subject to
 conflicting demands of integration, LBG commits to adhere to the
 implementation dates agreed between the OFT and the banking industry and

 









12


	
  

 	
  

 	
  

 
	
  

 	
  

 	
 will
 endeavour to effect such implementation as quickly as practicalities and
 systems allow;

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 implement in
 full any agreements that the OFT may make with the banking industry (within
 the scope of the current negotiations with respect thereto) relating to fees
 and charges, and the terms and conditions of PCAs and, subject to conflicting
 demands of integration, LBG commits to adhere to the implementation dates
 agreed between the OFT and the banking industry and will endeavour to effect
 such implementation as quickly as practicalities and systems allow; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 play a
 constructive role in any discussions between the banking industry and the OFT
 about fees and charges, and the terms and conditions of PCAs; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (D)

 	
 take
 reasonable steps to provide such information as is necessary to enable the
 Treasury or the OFT to monitor LBG’s compliance with paragraphs (A) and (B)
 above. 

 
	
  

 	
  

 	
  

 
	
 12. 

 	
 WARRANTIES 

 
	
  

 	
  

 
	
  

 	
 LBG
 represents and warrants to the Treasury on the date of this Deed that: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 it is duly
 organised and validly existing under the laws of its jurisdiction of
 organisation; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 it has the
 corporate power and the authority to execute and deliver this Deed and to
 perform its obligations under this Deed, and no additional act or proceeding,
 corporate or otherwise, on its part is necessary to authorise the execution
 and delivery of this Deed or the performance of any of its obligations under
 this Deed; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 subject to
 any principles of law affecting the rights of creditors generally and the
 provisions of section 117 of the Stamp Act 1891, the obligations expressed to
 be assumed by LBG under this Deed are legal, valid, binding and enforceable
 obligations; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (D)

 	
 it has duly
 executed and delivered this Deed. 

 
	
  

 	
  

 	
  

 
	
 13. 

 	
 RECOVERY OF STATE AID  

 
	
  

 	
  

 
	
 13.1

 	
 If the
 European Commission adopts a decision that the United Kingdom must recover
 any State Aid (a “Repayment Decision”)
 and the recovery order of the Repayment Decision has not been annulled or
 suspended by the Court of First Instance or the European Court of Justice,
 then LBG shall repay to the Treasury any aid ordered to be recovered under
 the Repayment Decision. 

 
	
  

 	
  

 
	
 13.2

 	
 The amount
 which LBG is obliged to repay to the Treasury under clause 13.1 shall be
 calculated by the Treasury and shall be calculated in accordance with Council
 

 










13


	
  

 	
  

 	
  

 
	
  

 	
 Regulation
 No 659/1999 and Commission Regulation 794/2004 (including with respect to the
 calculation of payable interest).

 
	
  

 	
  

 
	
 14.

 	
 PAYMENTS 

 
	
  

 	
  

 
	
 14.1

 	
 Any payment
 due to the Treasury under this Deed shall be made in pounds sterling to such
 account as may be notified to LBG in writing by the Treasury from time to
 time. 

 
	
  

 	
  

 
	
 14.2

 	
 All payments
 required to be made by LBG (or any member of the Group) under this Deed shall
 be made in full. They will be free and clear of any right of set-off and
 from any restriction, condition or deduction because of any counterclaim. 

 
	
  

 	
  

 
	
 15.

 	
 TAX MATTERS 

 
	
  

 	
  

 
	
 15.1

 	
 All payments
 by LBG (or any member of the Group) pursuant to this Deed shall be paid
 without any deduction or withholding, unless required by law. If any Tax is
 required by law to be deducted or withheld from or in connection with any
 such payment, the amount payable shall be increased so as to ensure that the
 amount received by the Treasury after such deduction or withholding
 (including any additional deduction or withholding required as a result of
 such increase) is equal to the amount which the Treasury would have received
 if no such deduction or withholding had been required. 

 
	
  

 	
  

 
	
 15.2

 	
 If the
 Treasury is subject to Tax in respect of any sum payable pursuant to this
 Deed, or if any such sum is taken into account in computing the profits,
 income or gains of the Treasury for Tax purposes, the sum payable shall be
 increased so as to ensure that the amount retained by the Treasury after the
 payment of such Tax (including any additional Tax payable as a result of such
 increase) is equal to the amount which the Treasury would have retained in
 the absence of such Tax. This clause 15.2 shall not apply to the Withdrawal
 Fee. 

 
	
  

 	
  

 
	
 15.3

 	
 Each sum
 payable by LBG (or any member of the Group) pursuant to this Deed is
 expressed exclusive of any amount in respect of VAT which is chargeable on
 any supply or supplies for which such sum (or any part thereof) is the whole
 or part of the consideration for VAT purposes. If the Treasury makes (or is
 deemed to make) any supply for VAT purposes in consideration for such sum (or
 any part thereof) and VAT is or becomes chargeable in respect of such supply,
 LBG shall pay (or shall procure that a member of the Group pays) to the
 Treasury (within 14 days of the receipt of a valid VAT invoice) an additional
 sum equal to the amount of such VAT. 

 
	
  

 	
  

 
	
 15.4

 	
 If LBG (or
any member of the Group) is obliged to pay any sum under or in connection
with this Deed by way of indemnity, reimbursement, damages or compensation
for or in respect of any liability, damage, cost, demand, charge or expense
(the “Relevant Cost”), the calculation of such sum shall include an amount
determined as follows:  

 
	
  

 	
  

 	
  

 
	
  

 	
 (A)

 	
 If the
 Relevant Cost is, for VAT purposes, the consideration for a supply of goods
 or services made to the Treasury (including where such supply is made to the
 Treasury as agent for LBG (or a member of the Group) within the terms of
 section 47 of the Value Added Tax Act 1994), such additional amount shall be 

 









14


	
  

 	
  

 	
  

 
	
  

 	
  

 	
 equal to any
 input VAT which was incurred by the Treasury in respect of that supply and
 which it is not able to recover from the relevant Tax authority; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 if the
 Relevant Cost is, for VAT purposes, a disbursement incurred by the Treasury
 as agent on behalf of LBG (or a member of the Group) and the relevant supply
 is made to LBG (or a member of the Group) for VAT purposes, such additional
 amount shall be equal to any amount in respect of VAT which was paid in
 respect of the Relevant Cost by the Treasury, and the Treasury shall use
 reasonable endeavours to procure that the relevant third party issues a valid
 VAT invoice in respect of the Relevant Cost to LBG (or the relevant member of
 the Group).

 






	
  

 	
  

 	
  

 
	
 15.5

 	
 LBG shall
 pay and bear, and shall indemnify the Treasury on demand against, any Stamp
 Duty which is payable or paid in connection with the execution, delivery,
 performance or enforcement of this Deed. 

 
	
  

 	
  

 
	
 15.6

 	
 The Treasury
 shall co-operate in completing any treaty forms or other procedural
 formalities reasonably requested by LBG for the purpose of enabling LBG (or
 the relevant member of the Group) to make any payment pursuant to this Deed
 without any deduction or withholding in respect of Tax. 

 
	
  

 	
  

 
	
 15.7

 	
 For the
 purposes of this clause 15: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 “Stamp
 Duty” means any stamp, documentary, registration or capital
 duty (including stamp duty, stamp duty reserve tax and any other similar duty
 or similar tax) and any fine, penalty, charge, cost or interest relating
 thereto; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 “VAT” means
(i) any Tax imposed in conformity with the council directive of 28 November
2006 on the common system of value added tax (EC Directive 2006/112)
(including, in relation to the United Kingdom, any value added tax imposed by
the Value Added Tax Act 1994 and/or any legislation or regulations
supplemental thereto); and (ii) any other Tax of a similar nature (whether imposed in a
member state of the European Union in substitution for or in addition to the
Tax mentioned above or imposed elsewhere).  

 
	
  

 	
  

 	
  

 
	
 16.

 	
 ANNOUNCEMENTS AND PUBLICITY 

 
	
  

 	
  

 
	
 16.1

 	
 Subject to
 this clause 16, LBG shall ensure that no member of the Group nor any of their
 respective Representatives, shall make, publish, issue or release any
 announcement or public statement in relation to, or which refers to (i) the
 Scheme (including LBG’s proposed withdrawal from the Scheme), (ii) this Deed
 (or any ancillary matter), (iii) the Treasury in connection with the Scheme
 or this Deed, or (iv) the State Aid Approval, the State Aid or the State Aid
 Commitments (each, a “Restricted Statement”). 

 
	
  

 	
  

 	
  

 
	
 16.2

 	
 Notwithstanding
 clause 16.1, each member of the Group may (and each such member’s
 Representatives may on its behalf) make, publish, issue or release a
 Restricted Statement provided that such Restricted Statement is made,
 published, issued or 

 









15


	
  

 	
  

 	
  

 
	
  

 	
 released
 only after giving as much prior notification as is reasonably practicable to,
 and consulting in good faith to the fullest extent reasonably practicable
 with, the Treasury with a view to giving the Treasury as much time as is
 reasonably practicable, in all the circumstances, to review and comment on
 such Restricted Statement.

 
	
  

 	
  

 
	
 16.3

 	
 If, in
 respect of any Restricted Statement, any member of the Group (or any of its
 Representatives) proposes not to adopt, or does not adopt, any amendment
 proposed by the Treasury pursuant to clause 16.2, LBG shall procure that such
 member of the Group or Representative shall (to the extent reasonably
 practicable, prior to the making, publication, issuance or release of the relevant
 Restricted Statement or, if not reasonably practicable, promptly thereafter)
 provide to the Treasury reasons explaining why such amendments are not
 proposed to be, or were not, adopted. 

 
	
  

 	
  

 
	
 16.4

 	
 If any
 member of the Group (or any of its Representatives) proposes to make,
 publish, issue or release a Restricted Statement and either: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (A)

 	
 notification
 to, and consultation with, the Treasury prior to the making, publication,
 issuance or release of such Restricted Statement is not permissible under:
 (i) applicable law; or (ii) the rules of the Bank of England or of any
 securities exchange, clearing system or Authority (including the FSA) to
 which it is subject or submits; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 the
 Restricted Statement must be made urgently such that prior notification to or
 consultation with the Treasury is not reasonably practicable, 

 
	
  

 	
  

 
	
  

 	
 then LBG
 shall ensure that the relevant member of the Group or Representative shall,
 as soon as permissible and reasonably practicable, provide a copy of such
 Restricted Statement to the Treasury, together with a notification providing
 reasonable details of the circumstances giving rise to the Restricted
 Statement.

 
	
  

 	
  

 
	
 16.5

 	
 Notwithstanding
 clause 16.1, the Representatives of each member of the Group may make on
 behalf of such member Restricted Statements which are unscripted oral public
 statements, provided that LBG shall use all reasonable endeavours to ensure
 that processes are in place with a view to ensuring that any such unscripted
 oral public statements are consistent with any other Restricted Statements
 made in accordance with this clause 16 by or on behalf of any member of the
 Group. 

 
	
  

 	
  

 
	
 17. 

 	
 CONFIDENTIALITY;
FREEDOM OF INFORMATION  

 
	
  

 	
  

 
	
 17.1

 	
 Each party
(the “first party”) shall treat as confidential any information that: (i) the
Treasury has indicated to the European Commission is covered by the
obligation of professional secrecy pursuant to articles 24 and 25 of Council
Regulation No 659/1999; and (ii) the other party (or its
Representatives) has provided to the first party (or its Representatives)
with respect to the matters referred to in this Deed and which each party has
agreed should be designated as being confidential (“Confidential
Information”).  

 
	
  

 	
  

 
	
 17.2

 	
 Each party
 shall: 

 









16


	
  

 	
  

 	
  

 	
  

 
	
  

 	
 (A)

 	
 not disclose
 any Confidential Information to any person other than to its respective
 Representatives: 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (i)

 	
 in the case
 of disclosure by the Treasury, to enable or assist the Treasury to fulfil any
 of the Treasury Permitted Purposes; and 

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 (ii)

 	
 in the case
 of disclosure by LBG, to the extent that such Representatives
 require the Confidential Information to enable or assist LBG to comply with
 its responsibilities and obligations, or exercise its rights, under this
 Deed; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 procure that
 any person to whom any Confidential Information is so disclosed by it complies with the restrictions
 contained in this clause 17 as if such person were a party to this Deed; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 have in
 place and maintain security measures and procedures to protect the confidentiality
 of Confidential Information. 

 
	
  

 	
  

 
	
 17.3

 	
 The Treasury
 shall use (and shall ensure that its Representatives will use) Confidential
 Information only for the Treasury Permitted Purposes (or, in the case of any
 person referred to in clause 17.5(B), for the purposes of enabling or
 assisting such person to fulfil its functions). 

 
	
  

 	
  

 
	
 17.4

 	
 LBG shall
 use (and shall ensure that its Representatives will use) Confidential
 Information only to enable or assist LBG to comply with its responsibilities
 and obligations, and exercise its rights, under this Deed. 

 
	
  

 	
  

 
	
 17.5

 	
 The
 restrictions in clauses 17.1 and 17.2 shall not prevent the Treasury from
 disclosing Confidential Information: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 to the
 European Commission, if and to the extent that the Treasury
 considers such disclosure is necessary in connection with (i) the application
 of the state aid rules of the EC Treaty, (ii) any European Commission
 decision relating to those rules or (iii) compliance with any of the United
 Kingdom’s reporting requirements under the State Aid Approval; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 to the FSA,
 the Bank of England, the National Audit Office, the Cabinet Office or any
 successor organisation of any of the foregoing to the extent that the
 Treasury considers that such disclosure is required to enable or assist: (i)
 the Treasury to fulfil any of the Treasury Permitted Purposes; or (ii) the
 FSA, the Bank of England, the National Audit Office and the Cabinet Office
 (or any of their respective successors) to fulfil their respective functions;
 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 to Parliament
 or to any Parliamentary committee (including the Public Accounts Committee,
 the House of Commons Treasury Select Committee and any Select Committee of
 the Parliament of the United Kingdom), in each case if and to the extent that
 the Treasury considers it appropriate to do so, provided that (where lawful
 and considered reasonably practicable by the Treasury (but excluding 

 









17


	
  

 	
  

 	
  

 
	
  

 	
  

 	
 any
 disclosure comprised in any unscripted oral statement)) the Treasury shall use
 reasonable endeavours to notify LBG of the Confidential Information to be
 disclosed; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (D)

 	
 in order to
 comply with the Treasury’s responsibilities and obligations, and exercising
 the Treasury’s rights, powers and discretions, under or in connection with
 the State Aid Approval; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (E)

 	
 to assist
 with providing or enabling the provision of financial support to LBG or
 protecting or enhancing the stability of the financial system of the United
 Kingdom; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (F)

 	
 discharging
 the Treasury’s responsibilities and functions. 

 
	
  

 	
  

 	
  

 
	
 17.6

 	
 The
 restrictions in clauses 17.1 and 17.2 shall not prevent the Treasury or LBG
 from disclosing Confidential Information:

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 which is
 required by: (i) applicable law; (ii) the rules of the Bank of England or of
 any securities exchange, clearing system or Authority (including the FSA) to
 which it is subject or submits; (iii) the FSA with respect to the matters
 described in clause 10; or (iv) the OFT with respect to the matters described
 in clause 11; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 if and to
 the extent required for the purpose of any judicial proceedings; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 if and to
 the extent the information has come into the public domain through no fault
 of that party. 

 
	
  

 	
  

 	
  

 
	
 17.7 

 	
 If the
Treasury is requested to disclose any Confidential Information pursuant to
the provisions of the Freedom of Information Act (the “FOI Act”, and such a
request, an “FOI Request”), the Treasury shall (to the extent practicable and
permissible under the FOI Act and consistent with the Code of Practice of the
Secretary of State for Constitutional Affairs on discharge of public
authorities’ functions under Part 1 of the FOI Act):  

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 notify LBG
 in writing of the nature and content of such FOI Request as soon as
 practicable; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 prior to the
 making of a disclosure pursuant to an FOI Request, for a period of no less
 than 5 Business Days consult with LBG as to: (i) whether such FOI Request is
 valid; (ii) whether or not disclosure pursuant to the FOI Act is required;
 and (iii) (if the Treasury determines that disclosure pursuant to the FOI Act
 is required) the scope and content of any proposed disclosure; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 (if the
 Treasury determines that disclosure pursuant to the FOI Act is required and
 LBG has objected to such disclosure or the extent of the proposed disclosure)
 give LBG as much prior notice as is reasonably practicable prior to such
 disclosure being made. 

 









18


	
  

 	
  

 	
  

 
	
 17.8

 	
 LBG acknowledges that the
 provision of information to the Treasury as provided for in this Deed is
 important, amongst other things, to enable the Treasury to monitor the
 performance by LBG of its responsibilities, duties and obligations under this
 Deed (including, in particular, with respect to compliance with the State Aid
 Approval). If LBG considers (having taken appropriate external legal advice)
 that applicable law, or pre-existing contractual restrictions, prevent or
 restrict the disclosure of any such information to the Treasury, it shall: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (A)

 	
 notify the Treasury of the
 information to which such restrictions relate together with reasonable details
 of the legal or contractual restrictions which prevent or restrict such
 disclosure; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 in determining whether to
 disclose such information, consider in good faith whether: (i) the balance of
 public interest; (ii) the nature of its responsibilities, duties and
 obligations under this Deed; and (iii) any duties of confidentiality owed by
 the Treasury to it, are such that the information should nevertheless be
 disclosed to the Treasury. 

 
	
  

 	
  

 
	
 17.9

 	
 No provision in this Deed
 shall require LBG (or any member of the Group) to provide any information
 protected by legal professional privilege or litigation privilege. 

 
	
  

 	
  

 
	
 17.10

 	
 For the purposes of this
clause 17, “Treasury Permitted Purposes” means: (i) complying with the
Treasury’s responsibilities and obligations, and exercising its rights,
powers and discretions, under or in connection with this Deed (including with
respect to the State Aid Approval); (ii) providing or enabling the provision
of financial support to LBG or protecting or enhancing the stability of the
financial system of the United Kingdom; (iii) reporting on compliance with
this Deed by LBG (including with respect to the State Aid Approval); and (iv)
discharging the Treasury’s responsibilities and functions.  

 
	
  

 	
  

 
	
 18.

 	
 ASSIGNMENT
 

 
	
  

 	
  

 
	
 18.1

 	
 The Treasury may effect a
 Transfer to any Government Entity on such terms as it considers appropriate. 

 
	
  

 	
  

 
	
 18.2

 	
 The Treasury shall effect a
Transfer by giving not less than 10 Business Days prior written notice to LBG
specifying the identity of the transferee and the rights, powers, discretions
or obligations under this Deed that are to be the subject of the Transfer
(the “Substituted Rights and Obligations”).  

 
	
  

 	
  

 
	
 18.3

 	
 If a notification is given
 by the Treasury pursuant to clause 18.2, LBG shall enter into such further
 agreements as are necessary in order to substitute the relevant transferee
 for the Treasury in respect of the Substituted Rights and Obligations. 

 
	
  

 	
  

 
	
 18.4

 	
 For the purpose of this
 clause 18: 

 
	
  

 	
  

 	
  

 
	
  

 	
 (A)

 	
 “Transfer” means: (i) the
assignment of all or any part of the Treasury’s rights and benefits of or
under this Deed; (ii) the declaration of a trust in respect of or  

 









19


	
  

 	
  

 	
  

 
	
  

 	
  

 	
 the entry
 into of any arrangement whereby the Treasury agrees to hold in trust for any
 person all or any part of the benefit of, or its rights or benefits under,
 this Deed; or (iii) the transfer (whether by way of novation, sub-contract,
 delegation or otherwise), or the entry into an arrangement whereby any person
 is to perform, any or all of the Treasury’s obligations under this Deed; and

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 “Government Entity” means: (i) any
 department, non-departmental public body, authority or agency of Her
 Majesty’s Government of the United Kingdom or the Crown; (ii) any of Her
 Majesty’s Secretaries of State and any other Minister of the Crown; (iii) the
 Treasury Solicitor; (iv) any body corporate established by statute some or
 all of the members of which are appointed by a Secretary of State or Minister
 of the Crown; (v) UK Financial Investments Limited; (vi) any quasi-governmental
 or regulatory body; and (vii) any other entity or person directly or
 indirectly owned or established by, or held on trust for, any of the
 foregoing. 

 
	
  

 	
  

 
	
 19.

 	
 REMEDIES 

 
	
  

 	
  

 
	
 19.1

 	
 No delay or
 omission by the Treasury or LBG (as the case may be) in exercising any right,
 power or remedy provided by law or under or pursuant to the Deed shall: (i)
 affect that right, power or remedy; or (ii) operate as a waiver of it. 

 
	
  

 	
  

 
	
 19.2

 	
 The single
 or partial exercise by the Treasury of any right, power or remedy provided by
 law or under or pursuant to this Deed shall not, unless otherwise expressly
 stated, preclude any other or further exercise of it or the exercise of any
 other right, power or remedy. 

 
	
  

 	
  

 
	
 19.3

 	
 Any right of
 the Treasury is cumulative and not exclusive of any other right (whether
 provided by law or otherwise). 

 
	
  

 	
  

 
	
 19.4

 	
 LBG
 acknowledges and agrees that: (i) breaches by it of this Deed may result in
 injury to the public and/or third parties rather than injury specific to the
 Treasury; and/or (ii) damages may not be an adequate remedy for any breach of
 any of this Deed, and further acknowledges and agrees that, without prejudice
 to any other rights or remedies which the Treasury may have, whether pursuant
 to a provision of this Deed or otherwise equitable relief (including specific
 performance and injunction) for any such breach (or potential breach) will
 normally be appropriate. LBG agrees not to raise any objection to any
 application by the Treasury for any such remedies. 

 
	
  

 	
  

 
	
 20.

 	
 FURTHER ASSURANCE 

 
	
  

 	
  

 
	
  

 	
 LBG shall,
 at its own cost, from time to time on request, do or procure the doing of all
 acts and/or execute or procure the execution of all documents in a form
 satisfactory to the Treasury for giving full effect to this Deed and securing
 the full benefit of the rights, powers and remedies conferred upon the
 Treasury in this Deed. 

 









20


	
  

 	
  

 
	
 21.

 	
 INVALIDITY 

 
	
  

 	
  

 
	
  

 	
 If any
 provision of this Deed shall be held to be illegal, invalid or unenforceable,
 in whole or in part, under any enactment or rule of law, such provision or
 part shall to that extent be deemed not to form part of this Deed but the
 legality, validity and enforceability of the remainder of this Deed shall not
 be affected. 

 
	
  

 	
  

 
	
 22. 

 	
 NOTICES 

 
	
  

 	
  

 
	
 22.1

 	
 Except as
 otherwise provided in this Deed, a notice under this Deed shall only be
 effective if it is in writing. Facsimile transmissions are permitted but
 email is not. 

 
	
  

 	
  

 
	
 22.2

 	
 Notices
 under this Deed shall be sent to a party to this Deed at its address or
 number and for the attention of the individual set out below: 

 






	
  

 	
  

 	
  

 
	
 Party and title of
individual  

 	
Address  

 	
Facsimile no.  

 
	
 

 	
 

 	
 

 
	
  

 
	
 LBG

 	
 Henry Duncan
 House

 	
  

 
	
  

 	
 120 George
 St

 	
  

 
	
  

 	
 Edinburgh

 	
  

 
	
  

 	
 Scotland EH2
 4LH

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 Attention:
 Company Secretary

 	
  

 
	
  

 	
  

 	
  

 
	
 Treasury

 	
 1 Horse
 Guards Road

 	
 0207 270
 4844

 
	
  

 	
 London SW1A
 2HQ

 	
  

 
	
  

 	
  

 	
  

 
	
  

 	
 Attention:
 Nikhil Rathi (team leader,

 	
  

 
	
  

 	
 financial
 stability)

 	
  

 






	
  

 	
  

 
	
  

 	
 provided
 that a party may change its notice details on giving notice to the other
 party of the change in accordance with this clause 22. That notice shall only
 be effective on the day falling five clear Business Days after the
 notification has been received or such later date as may be specified in the
 notice. 

 
	
  

 	
  

 
	
 22.3

 	
 Any notice
 given under this Deed shall, in the absence of earlier receipt, be deemed to
 have been duly given as follows: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 if delivered
 personally, on delivery; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 if sent by
 first class post, two clear Business Days after the date of posting; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 if sent by
 facsimile, when despatched. 

 
	
  

 	
  

 
	
 22.4

 	
 Any notice
 given under this Deed outside Working Hours in the place to which it is
 addressed shall be deemed not to have been given until the start of the next
 period of Working Hours in such place. 

 









21


	
  

 	
  

 
	
 22.5

 	
 The
 provisions of this clause 22 shall not apply in relation to the service of
 Service Documents. 

 
	
  

 	
  

 
	
 23. 

 	
 CONTRACTS
(RIGHTS OF THIRD PARTIES) ACT 1999  

 
	
  

 	
  

 
	
 23.1

 	
 Clauses 10
and 11 (the “Third Party Provisions”) confer a benefit on certain persons
named therein who are not a party to this Deed (each, a “Third Party”). The
Third Party Provisions are intended to be enforceable by each Third Party by
virtue of the Contract (Rights of Third Parties) Act 1999.  

 
	
  

 	
  

 
	
 23.2

 	
 Other than
 the Third Party Provisions, the parties to this Deed do not intend that any
 term of this Deed should be enforceable, by virtue of the Contracts (Rights
 of Third Parties) Act 1999, by any person who is not a party to this Deed. 

 
	
  

 	
  

 
	
 23.3

 	
 Notwithstanding
 clause 23.1, any amendment to this Deed may be effected without the consent
 of any Third Party. 

 
	
  

 	
  

 
	
 24.

 	
 COUNTERPARTS 

 
	
  

 	
  

 
	
  

 	
 This Deed
 may be executed in any number of counterparts, and by the parties on separate
 counterparts, but shall not be effective until each party has executed at
 least one counterpart. Each counterpart shall constitute an original of this
 Deed, but all the counterparts together shall constitute one and the same
 instrument. 

 
	
  

 	
  

 
	
 25.

 	
 VARIATION 

 
	
  

 	
  

 
	
 25.1 

 	
 Any term of
 this Deed may be amended, and the observance of any term of this Deed may be
 waived (either generally or in a particular instance and either retroactively
 or prospectively), only with the written consent of the Treasury.

 
	
  

 	
  

 
	
 25.2

 	
 Subject to
 clause 25.3, and except where a State Aid Approval has been annulled or
 suspended by the Court of First Instance or the European Court of Justice, if
 the Treasury considers at any time that it is necessary to modify the State
 Aid Commitments: (i) in order to reflect that the conditions subject to which
 it was anticipated the European Commission would give the State Aid Approval
 are different from the conditions subject to which the European Commission
 ultimately does give the State Aid Approval; or (ii) to reflect a change to
 the State Aid Approval, then, in either case, the Treasury may by notice (but
 subject to its obligation to consult in good faith with LBG pursuant to
 clause 4.1) supplement, modify, replace or delete any part of the State Aid
 Commitments in such a manner as the Treasury considers necessary (acting
 reasonably). 

 
	
  

 	
  

 
	
 25.3

 	
 If, at any
 time following receipt of State Aid Approval, the Treasury or the European
 Commission seeks to supplement, modify or replace any part of the State Aid
 Conditions or a State Aid Approval, then LBG and the Treasury will each
 cooperate in good faith with a view to agreeing an appropriate response to
 such proposals. However, the Treasury will not, without the consent of LBG
 (acting reasonably) agree to any such supplement, modification or replacement
 that would have the effect of making 

 









22


	
  

 	
  

 
	
  

 	
 any of the
 State Aid Conditions or a State Aid Approval significantly more onerous to
 LBG. 

 
	
  

 	
  

 
	
 26.

 	
 AGENT FOR SERVICE OF PROCESS 

 
	
  

 	
  

 
	
 26.1 

 	
 LBG
 irrevocably appoints Lloyds TSB Bank plc of 25 Gresham Street, London EC2V
 7HN to be its agent for the receipt of Service Documents. It agrees that any
 Service Document may be effectively served on it in connection with
 Proceedings in England and Wales by service on its agent effected in any
 manner permitted by the Civil Procedure Rules.

 
	
  

 	
  

 
	
 26.2

 	
 If the agent
 at any time ceases for any reason to act as such, LBG shall appoint a
 replacement agent having an address for service in England or Wales and shall
 notify the Treasury of the name and address of the replacement agent. Failing
 such appointment and notification, the Treasury shall be entitled by notice
 to LBG to appoint a replacement agent to act on behalf of LBG. The provisions
 of this clause 26 applying to service on an agent apply equally to service on
 a replacement agent. 

 
	
  

 	
  

 
	
 26.3

 	
 A copy of
 any Service Document served on an agent shall be sent by post to LBG. Failure
 or delay in so doing shall not prejudice the effectiveness of service of the
 Service Document. 

 
	
  

 	
  

 
	
 27. 

 	
 GOVERNING LAW 

 
	
  

 	
  

 
	
  

 	
 This Deed
 shall be governed by and construed in accordance with the laws of England. 

 
	
  

 	
  

 
	
 28.

 	
 JURISDICTION 

 
	
  

 	
  

 
	
 28.1

 	
 The courts
 of England are to have exclusive jurisdiction to settle any Proceedings
 arising out of or in connection with this Deed. 

 
	
  

 	
  

 
	
 28.2

 	
 Each party
 waives (and agrees not to raise) any objection, on the ground of forum non
 conveniens or on any other ground, to the taking of Proceedings by another
 party in the courts of England. Each party to this Deed also agrees that a
 judgment against it in Proceedings brought in England in accordance with this
 clause 28 shall be conclusive and binding upon it and may be enforced in any
 other jurisdiction. 

 
	
  

 	
  

 
	
 28.3

 	
 Each party
 irrevocably submits and agrees to submit to the jurisdiction of the English
 courts. 

 









IN WITNESS WHEREOF this
document has been executed and delivered as a deed the day and year first
before written. 


	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Executed as
 a deed by two of

 	
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 THE LORDS COMMISSIONERS OF HER

 	
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 MAJESTY’S TREASURY

 	
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 By:

 
	
  

 	
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 By:

 
	
  

 	
  

 	
  

 	
 

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 Executed as
 a deed by

 	
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 LLOYDS BANKING GROUP PLC

 	
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 acting by a
 director and its secretary/two

 	
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 By:

 	

  


 	
  

 
	
 directors:

 	
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 Director

 
	
  

 	
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 Director/Secretary

 



 CA093050005






IN WITNESS WHEREOF this
document has been executed and delivered as a deed the day and year first
before written. 



	
  

 	
  

 	
  

 	
  

 	
  

 
	
 Executed as
 a deed by two of

 	
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 THE LORDS COMMISSIONERS OF HER

 	
 )

 	
  

 
	
 MAJESTY’S TREASURY

 	
 )

 	
 By:

 
	
  

 	
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 Executed as a deed by
LLOYDS BANKING GROUP PLC
acting by a
 director and its secretary/two
directors:

 	
 )

 	
  

 	
  

 
	
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 By:

 	
  

 
	
  

 	
 

 	
  

 
	
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 By:

 	

 	
 


 
	
  

 	
  

 	
  

 	
 

 	
  

 
	
  

 
	
  

 	
  

 	
  

 	
 Director/Secretary

 



 CA093050005