Exhibit 4(a)(x) 


Dated: 3 November 2009


THE LORDS COMMISSIONERS OF HER
MAJESTY’S TREASURY


and 


LLOYDS BANKING GROUP PLC




UNDERTAKING TO SUBSCRIBE
and related matters




Slaughter and May

One Bunhill Row

London EC1Y 8YY

(JAYP/MDSC)


CD093010014






CONTENTS


	
 

	
 

	
 

	
 


	
 

	
 

	
Page


	
 

	
 

	
 

	
 


	
1.

	
DEFINITIONS AND
INTERPRETATION

	
1

	
 


	
 

	
 

	
 

	
 


	
2.

	
EFFECTIVENESS

	
7

	
 


	
 

	
 

	
 

	
 


	
3.

	
UNDERTAKING TO
SUBSCRIBE

	
7

	
 


	
 

	
 

	
 

	
 


	
4.

	
WARRANTIES

	
11

	
 


	
 

	
 

	
 

	
 


	
5.

	
TAX MATTERS

	
11

	
 


	
 

	
 

	
 

	
 


	
6.

	
ANNOUNCEMENTS AND
PUBLICITY

	
14

	
 


	
 

	
 

	
 

	
 


	
7.

	
CONFIDENTIALITY;
FREEDOM OF INFORMATION

	
15

	
 


	
 

	
 

	
 

	
 


	
8.

	
ASSIGNMENT

	
17

	
 


	
 

	
 

	
 

	
 


	
9.

	
REMEDIES

	
18

	
 


	
 

	
 

	
 

	
 


	
10.

	
INVALIDITY

	
18

	
 


	
 

	
 

	
 

	
 


	
11.

	
NOTICES

	
19

	
 


	
 

	
 

	
 

	
 


	
12.

	
CONTRACTS (RIGHTS
OF THIRD PARTIES) ACT 1999

	
20

	
 


	
 

	
 

	
 

	
 


	
13.

	
COUNTERPARTS

	
20

	
 


	
 

	
 

	
 

	
 


	
14.

	
VARIATION

	
20

	
 


	
 

	
 

	
 

	
 


	
15.

	
TERMINATION

	
20

	
 


	
 

	
 

	
 

	
 


	
16.

	
AGENT FOR SERVICE
OF PROCESS

	
20

	
 


	
 

	
 

	
 

	
 


	
17.

	
GOVERNING LAW

	
21

	
 


	
 

	
 

	
 

	
 


	
18.

	
JURISDICTION

	
21

	
 















	
 

	
 


	
THIS
DEED 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)

	
LBG intends to
effect the Rights Issue (as defined below). 


	
 

	
 


	
(B)

	
The Treasury
Solicitor (as nominee of the Treasury) is, at the date of this Deed, the
registered owner of 11,798,531,471 Ordinary Shares (each as defined below). 


	
 

	
 


	
(C)

	
Subject to the
terms and conditions set out in this Deed, the Treasury has agreed to procure
that the Treasury Solicitor (i) votes in favour of all of the Resolutions in
accordance with the recommendation of the board of LBG (except for the HMT
Resolution); and (ii) takes up (as nominee of the Treasury) the Treasury’s
rights to subscribe for all of the HMT Rights Issue Shares to be issued under
the Rights Issue, in consideration, inter
alia, for which LBG has agreed to pay to the Treasury the HMT Commitment
Commission (each as defined below). 


	
 

	
 


	
NOW THIS DEED
WITNESSES AS FOLLOWS: 


	
 

	
 


	
1.

	
DEFINITIONS
AND INTERPRETATION 


	
 

	
 


	
1.1

	
In this Deed
(including the Recitals): 


	
 

	
 


	
 

	
“Acceptance” has the meaning given in
clause 3.2(A); 


	
 

	
 


	
 

	
“Acceptance Date” has the meaning given in
clause 3.2(A); 


	
 

	
 


	
 

	
“Admission” means the admission of the HMT
Rights Issue Shares (nil paid) to the Official List of the UK Listing
Authority becoming effective and the admission of such shares (nil paid) to
trading on the main market for listed securities of the London Stock Exchange
plc becoming effective; 


	
 

	
 


	
 

	
“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; 


	
 

	
 


	
 

	
“Base Fee” means 2.25 per cent. of the
Issue Price; 












2


	
 

	
 


	
 

	
“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; 


	
 

	
 


	
 

	
“Claims” means any and all claims, actions, liabilities,
demands, proceedings, regulatory or governmental investigations, judgments or
awards whatsoever (and, in each case, whether or not successful, compromised
or settled and whether joint or several) threatened, asserted, established or
instituted against or otherwise involving any person, and “Claim” shall be
construed accordingly;  


	
 

	
 


	
 

	
“Confidential Information” has the meaning given in clause
7.1; 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“Exchange Offer Memoranda” has the meaning given in the
Underwriting Agreement; 


	
 

	
 


	
 

	
“HMT Commitment Commission” has the meaning given in clause
3.3;


	
 

	
 


	
 

	
“FOI Act” has the meaning given in clause 7.7; 


	
 

	
 


	
 

	
“FOI Request” has the meaning given in clause 7.7;


	
 

	
 


	
 

	
“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; 


	
 

	
 


	
 

	
“GM” means the general meeting of LBG at which the
Resolutions are proposed; 


	
 

	
 


	
 

	
“Government Entity” has the meaning given in clause 8.4(B); 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“HMT Resolution” means resolution 4, as set out in the notice
of GM contained in the Circular, regarding certain transactions involving the
Treasury; 


	
 

	
 


	
 

	
“HMT Rights Issue Shares” means the new Ordinary Shares which
are to be offered in respect of the Relevant Shares pursuant to the Rights
Issue; 


	
 

	
 


	
 

	
“Issue Price” means the higher of (i) 15 pence per HMT Rights
Issue Share; and (ii) such other issue price per HMT Rights Issue Share as
shall be determined in accordance with clause 2.5 of the Underwriting
Agreement, in which case this term shall mean such revised price; 












3


	
 

	
 


	
 

	
“Joint Global Co-ordinators” means Citigroup Global Markets
U.K. Equity Limited, Merrill Lynch International and UBS Limited, as
appointed by LBG pursuant to the terms of the Underwriting Agreement in
relation to the Rights Issue; 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“Losses” means any and all loss, damage, cost, liability,
demand, charge or expense (including legal fees) which any person may suffer
or incur (including, but not limited to, all Losses suffered or incurred in
investigating, preparing for or disputing or defending or settling any Claim
and/or in establishing its right to be indemnified pursuant to clause 3.6
and/or in seeking advice regarding any Claim or in any way related to or in
connection with the indemnity contained in clause 3.6), and “Loss” shall be
construed accordingly; 


	
 

	
 


	
 

	
“Ordinary Shares” means the ordinary shares of 25 pence each
in the capital of LBG, or following the Share Capital Subdivision becoming
effective, ordinary shares of 10 pence each in the capital of LBG; 


	
 

	
 


	
 

	
“PALs” means the renounceable provisional allotment letters
expected to be sent to certain shareholders of LBG in connection with the
Rights Issue; 


	
 

	
 


	
 

	
“Per Share Discretionary Fee” means the aggregate pounds
sterling amount (if any) paid by LBG to any and all of the Joint Bookrunners
as a discretionary fee, pursuant to and in accordance with clauses 10.2 and
10.6 of the Underwriting Agreement, divided by the aggregate number of
Underwritten Shares (each as defined in the Underwriting Agreement); 


	
 

	
 


	
 

	
“Pre-Marketing” means any and all contacts, presentations,
discussions, road-shows, conversations and other marketing or
investor-education activities effected by or on behalf of LBG in relation to
the Rights Issue or other associated transactions prior to the release of the
Press Announcement, including the disclosure of information in respect of
(amongst other things) the Scheme, the “stress test” analysis performed by
the FSA in relation to the capital of LBG, the State Aid Approval, the
prospective terms of the Rights Issue and other transactions contemplated by
the Prospectus, and the possible intentions of the Treasury, the European
Commission and the FSA in relation to those and other associated matters; 


	
 

	
 


	
 

	
“Press Announcement” means the press announcement to be
released by LBG giving details of, amongst other things, the Rights Issue; 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“Proposals Resolutions” means Resolutions 1, 2, 4, 6, 7, 8, 9
and 11 as set out in the notice of general meeting of LBG contained in the
Circular; 


	
 

	
 


	
 

	
“Prospectus” means the prospectus to be issued by LBG in
respect of the Rights Issue in accordance with the Prospectus Rules; 












4


	
 

	
 


	
 

	
“Prospectus Rules” means the prospectus
rules made by the FSA under Part VI of the FSMA; 


	
 

	
 


	
 

	
“Relevant Cost” has the meaning given in
clause 5.4; 


	
 

	
 


	
 

	
“Relevant Documents” has the meaning given
in the Underwriting Agreement; 


	
 

	
 


	
 

	
“Relevant Person” means 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, officers, officials, employees
and agents of the foregoing; 


	
 

	
 


	
 

	
“Relevant Shares” means the Ordinary
Shares which are held by the Treasury Solicitor (as nominee of the Treasury)
from time to time; 


	
 

	
 


	
 

	
“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,
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; 


	
 

	
 


	
 

	
“Resolutions” means all of the resolutions
set out in the notice of general meeting of LBG contained in the Circular, to
approve (amongst other things): (i) the payment of the HMT Commitment
Commission by LBG to the Treasury; and (ii) the Rights Issue; 


	
 

	
 


	
 

	
“Restricted Statement” has the meaning
given In clause 6.1; 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“Scheme” means the Asset Protection
Scheme, announced by the Government of the United Kingdom on 19 January 2009;



	
 

	
 


	
 

	
“Securities Act” means the US Securities
Act of 1933, as amended, and the rules promulgated thereunder; 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“Share Capital Subdivision” means the
proposed subdivision and conversion of the Company’s ordinary share capital
described in the Circular and the Prospectus; 


	
 

	
 


	
 

	
“Stamp Tax” means any stamp, documentary,
registration or capital duty or tax (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; 












5


	
 

	
 


	
 

	
“State Aid Approval” means the approval or anticipated
approval, subject to certain conditions, by the European Commission of 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 any aspect of the Rights Issue as
aid compatible with article 87 of the EC Treaty; 


	
 

	
 


	
 

	
“Subscription Proceeds” has the meaning given in clause
3.2(B); 


	
 

	
 


	
 

	
“Substituted Rights and Obligations” has the meaning given in
clause 8.2; 


	
 

	
 


	
 

	
“Tax” or “Taxation” means all forms of taxation and
statutory, governmental, state, provincial, local governmental or municipal
impositions, duties, contributions and levies (including, for the avoidance
of doubt, Stamp Tax), in each case in the nature of taxation, duty,
contribution or levy, whether of the United Kingdom or elsewhere in the world
whenever imposed and whether chargeable directly or primarily against or
attributable directly or primarily to any member of the Group or any other
person and all penalties, charges, costs and interest relating thereto; 


	
 

	
 


	
 

	
“Transfer” has the meaning given in clause 8.4(A); 


	
 

	
 


	
 

	
“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; (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; and
(iii) discharging the Treasury’s responsibilities and functions; 


	
 

	
 


	
 

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


	
 

	
 


	
 

	
“Undertakings” means the undertakings given by the Treasury
provided for in clauses 3.1 and 3.2; 


	
 

	
 


	
 

	
“Underwriting Agreement” means the underwriting agreement
between, inter alia, LBG,
Merrill Lynch International, UBS Limited, Citigroup Global Markets U.K.
Equity Limited, Goldman Sachs International, HSBC Bank plc, J.P. Morgan
Securities Ltd and J.P. Morgan Cazenove Limited, of even date hereof, in
relation to the proposed Rights Issue; 


	
 

	
 


	
 

	
“Underwriting Warranties” has the meaning given in clause
3.5; 


	
 

	
 


	
 

	
“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); and 












6


	
 

	
 

	
 


	
 

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


	
 

	
 

	
 


	
 

	
(C)

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


	
 

	
 

	
 


	
 

	
(D)

	
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); 


	
 

	
 

	
 


	
 

	
(E)

	
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 


	
 

	
 

	
 


	
 

	
(F)

	
a reference to any other
document to which both the Treasury and LBG are party is a reference to that
other document as amended, varied or supplemented at any time. 


	
 

	
 

	
 


	
1.3

	
Any reference to any indemnity,
covenant to pay or payment (a “Payment
Obligation”) being given or made on an “after-Tax basis” or
expressed to be calculated on an “after-Tax basis” means that, in calculating
the amount payable pursuant to such Payment Obligation (the “Payment”), there shall be taken into
account (if and to the extent that the same has not already been taken into
account in the calculation of the Payment): 


	
 

	
 

	
 


	
 

	
(A)

	
any Tax suffered by the person
entitled to receive the Payment to the extent that it arises as a result of
the matter giving rise to the Payment Obligation or as a result of receiving,
or being entitled to receive, the Payment; and 


	
 

	
 

	
 


	
 

	
(B)

	
any relief, exemption, allowance
or credit which is available to set against any Tax otherwise payable or
against any income, profits or gains for Tax purposes, and any right to any
refund or reimbursement of any Tax, which in each case is available to the
person entitled to receive the Payment if and to the extent that the same
arises as a result of the matter giving rise to the Payment Obligation or as
a result of receiving, or being entitled to receive, the Payment, 


	
 

	
 

	
 


	
 

	
such that the
person entitled to receive the Payment is in the same economic position after
Tax that it would have been in if the matter giving rise to the Payment
Obligation had not occurred.












7


	
  

 	
  

 	
  

 
	
 2.

 	
 EFFECTIVENESS 

 
	
  

 	
  

 
	
 2.1

 	
 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

 	
 The Treasury shall cease to be
 bound by the Undertakings if: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 the Press Announcement is not
 released through a regulatory information service at or before 7.00 a.m. on
 the date of this Deed, or such later time and/or date as LBG and the Joint
 Global Co-ordinators may agree in writing pursuant to, and in accordance
 with, the Underwriting Agreement; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 the Prospectus is not published
 in accordance with the Prospectus Rules at or before 7.00 a.m. on the date of
 this Deed, or such later time and/or date as LBG and the Joint Global
 Co-ordinators may agree in writing pursuant to, and in accordance with, the
 Underwriting Agreement; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 a new Issue Price in excess of
 15 pence is determined in accordance with clause 2.5 of the Underwriting
 Agreement, and the press announcement and pricing statement giving details of
 the revised Issue Price is not released through a regulatory information
 service at or before 7.00 a.m. on 24 November 2009; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (D)

 	
 any of the Proposal Resolutions
 is not passed at the GM on the date for which it has been convened (or, to
 the extent as LBG and the Joint Global Co-ordinators may agree in writing
 pursuant to, and in accordance with, the Underwriting Agreement, any
 adjournment thereof); or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (E)

 	
 Admission does not occur at or
 before 8.00 a.m. on 27 November 2009, or such later time and/or date as LBG
 and the Joint Global Co-ordinators may agree in writing pursuant to, and in
 accordance with, the Underwriting Agreement. 

 
	
  

 	
  

 	
  

 
	
 3.

 	
 UNDERTAKING TO
 SUBSCRIBE 

 
	
  

 	
  

 
	
 3.1

 	
 Subject to clauses 2.2(A), (B)
 and (C), the Treasury hereby irrevocably undertakes to LBG to procure that
 the Treasury Solicitor shall exercise, or procure the exercise of, all voting
 rights attaching to the Relevant Shares on all of the Resolutions in
 accordance with the recommendation of the board of LBG (except for Resolution
 4, as set out in the notice of general meeting of LBG contained in the
 Circular). 

 
	
  

 	
  

 
	
 3.2

 	
 Subject to clause 2.2, the
 Treasury hereby irrevocably undertakes to LBG to procure that the Treasury
 Solicitor shall: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 prior to the latest time and
date for acceptance under the Rights Issue (the “Acceptance Date”), apply and
subscribe (as nominee for the Treasury) (unless otherwise agreed in this
Deed, on the terms set out in the Prospectus, any pricing statement published
by LBG and, where relevant, the terms of the PALs)  

 










8


	
  

 	
  

 	
  

 
	
  

 	
  

 	
 for all of the HMT Rights Issue
 Shares under the Rights Issue each at the Issue Price (the “Acceptance”);

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 ensure that payment in cash
 consideration (within the meaning given by section 583 of the Companies Act
 2006), in pounds sterling and in a manner which is not prohibited by section
 587 of the Companies Act 2006, is made to LBG (or as otherwise directed by
 LBG) in respect of the aggregate subscription price for the HMT Rights Issue
 Shares subscribed by the Treasury, being the Issue Price multiplied by the
 number of HMT Rights Issue Shares, (the “Subscription
 Proceeds”) at or prior to 11.00 a.m. on the Acceptance Date; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (C)

 	
 unless otherwise agreed with
 LBG, not dispose of the Relevant Shares, any other Ordinary Shares or any
 interest (as such term is defined in Section 820 of the Companies Act 2006)
 therein or any right relating to the HMT Rights Issue Shares prior to the
 earliest to occur of: (i) the Rights Issue closing; (ii) the Rights Issue
 lapsing or being terminated in accordance with its terms; (iii) LBG
 confirming in writing that it has no further intention to proceed with the
 Rights Issue; and (iv) 31 December 2009. 

 
	
  

 	
  

 	
  

 
	
 3.3

 	
 Conditional upon the Acceptance
 and the receipt by LBG of the Subscription Proceeds, LBG shall pay, or
 procure that one of its subsidiaries shall pay, to the Treasury (or to such
 other person as the Treasury may direct) in cash, in pounds sterling, a fee
 equal to: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 the Base Fee multiplied by the
 aggregate number of HMT Rights Issue Shares (the “Base Fee Amount”); plus 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 the Per Share Discretionary Fee
 multiplied by the aggregate number of HMT Rights Issue Shares, 

 
	
  

 	
  

 	
  

 
	
  

 	
 in consideration, inter alia, for the Treasury giving the
 Undertakings (the “HMT Commitment
 Commission”).

 
	
  

 	
  

 
	
 3.4

 	
 LBG shall pay, or procure that
 one of its subsidiaries shall pay, the HMT Commitment Commission to the
 Treasury not later than the fifth Business Days following the Acceptance Date
 (provided that payment of the Subscription Proceeds has been made in accordance
 with clause 3.2(B)). Without prejudice to its right to receive payment of the
 HMT Commitment Commission directly from LBG, or one of its subsidiaries,
 pursuant to this Clause 3.4, the Treasury shall be entitled and is authorised
 to set-off the Base Fee Amount (or any portion thereof) against its
 obligation to pay the Subscription Proceeds. In the event that the Base Fee
 Amount (or any portion thereof) is set-off against the Treasury’s obligation
 to pay the Subscription Proceeds, then such Base Fee Amount (or such portion
 thereof) shall be deducted from the Subscription Proceeds in full
 satisfaction of LBG’s obligation to pay the Base Fee Amount (or such portion
 thereof) pursuant to this Deed and in full satisfaction of the Treasury’s
 obligation to pay that portion of the Subscription Proceeds. 

 













	
  

 	
  

 	
  

 
	
 9

 
	
  

 
	
 3.5

 	
 Without prejudice to the
 provisions of clause 4, LBG represents, warrants and undertakes to the
 Treasury that each statement set out in Schedule 3 to the Underwriting
 Agreement (together, the “Underwriting Warranties”) is true
 and accurate and not misleading on the date of this Deed and shall remain
 true and accurate and not misleading and shall be repeated at any Re-Pricing
 Date (as defined in the Underwriting Agreement), at Admission, at the Acceptance
 Date, at any Time of Sale (as defined in the Underwriting Agreement), at the
 Settlement Date (as defined in the Underwriting Agreement) and on the date of
 publication of any supplementary prospectus, in each case, by reference to
 the facts and circumstances then existing (subject to any such matters and
 facts fairly disclosed in any supplementary prospectus published prior to the
 relevant date). The provisions of clauses 12.2, 12.4, 12.5, 12.6, 12.7, 12.8
 and 12.14 of the Underwriting Agreement shall apply, mutatis mutandis, to this clause 3.5 as
 if such provisions were repeated herein (and all references in such
 provisions to: (i) the “Banks”, the “Underwriters” or “Joint Global
 Co-ordinators” shall be deemed to be references to the Treasury; and (ii) the
 “Underwritten Shares” shall be deemed to be references to the HMT Rights
 Issue Shares). 

 
	
  

 	
  

 
	
 3.6

 	
 Without restricting the rights
 of the Treasury or its ability to claim damages on any basis, LBG agrees to
 fully and effectively indemnify and hold harmless each Relevant Person on an
 after-Tax basis (whether or not the relevant Loss or Claim is suffered or
 incurred or arises in respect of circumstances or events existing or
 occurring before, on or after the date of this Deed and regardless of the
 jurisdiction in which such Loss or Claim is suffered or incurred) from and
 against any and all Losses or Claims whatsoever, as incurred, if such Losses
 or Claims arise directly or indirectly out of, or are attributable to, or
 connected with, anything done or omitted to be done by any person (including
 by the applicable Relevant Person) in connection with the Pre-Marketing, the
 Share Capital Subdivision, the Rights Issue, Admission, or the arrangements
 contemplated by the Prospectus, the Circular, the PALs, the Press
 Announcement, any other Relevant Document and/or either of the Exchange Offer
 Memoranda (or any amendment or supplement to any of them), or this Deed or
 any other agreement relating to the Rights Issue, including any and all
 Losses or Claims whatsoever, as incurred, in connection with or arising out
 of: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 the Prospectus, the Circular,
 the PALs, the Press Announcement, any other Relevant Document, either of the
 Exchange Offer Memoranda and/or any materials used for the purposes of the
 Pre-Marketing (or any amendment or supplement to any of them) not containing
 or fairly presenting, or being alleged not to contain or not to fairly
 present, all information required to be contained therein, or arising out of
 any untrue or inaccurate statement or alleged untrue or inaccurate statement
 of a material fact contained in any such documents or materials (or any
 amendment or supplement to any of them), or the omission or alleged omission
 therefrom of a fact necessary in order to make the statements therein not
 misleading in any material respect, or any statement therein being or alleged
 to be in any respect not based on reasonable grounds, in the light of the
 circumstances in which they were made; and/or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 any breach or alleged breach by
 LBG of any of the Underwriting Warranties, 

 













	
  

 	
  

 	
  

 
	
 10

 
	
  

 
	
  

 	
 PROVIDED THAT, the
 indemnity contained in this clause 3.6 shall not apply to any Losses or
 Claims: (i) if and to the extent arising out of a decline in market value of
 the HMT Rights Issue Shares suffered or incurred by any Relevant Person as a
 result of HM Treasury having subscribed for the HMT Rights Issue Shares
 pursuant to this Deed save to the extent such decline is caused by or results
 from or is attributable to or would not have arisen but for (in each case
 directly or indirectly) (aa) the neglect or default of LBG in relation to the
 content, publication, issue or distribution of the Prospectus, the Circular,
 the PALs, the Press Announcement, any other Relevant Document, either of the
 Exchange Offer Memoranda and/or any materials used for the purposes of the
 Pre-Marketing or (bb) any of the matters referred to in clause 3.6(A); and/or
 (ii) if and to the extent that they are Losses or Claims in respect of Tax
 which are covered by clause 5 (or which would have been so covered but for
 any exclusion contained in clause 5). 

 
	
  

 	
  

 
	
 3.7

 	
 The provisions of clause 18.10
 of the Underwriting Agreement shall apply, mutatis
 mutandis, to clause 3.6 as if such provisions were repeated
 therein (and all references in such provisions to: (i) the “Banks” or any
 “Underwriter” shall be deemed to be references to the Treasury; (ii) any
 “Indemnified Person” shall be deemed to be references to any Relevant Person;
 and (iii) the “Underwritten Shares” shall be deemed to be references to the
 HMT Rights Issue Shares). 

 
	
  

 	
  

 
	
 3.8

 	
 The provisions of clause 15 of
 the Underwriting Agreement (Contribution), except clause 15.7 of the
 Underwriting Agreement, shall apply, mutatis
 mutandis, to this Deed as if such provisions were repeated therein
 (and all references in such provisions to: (i) Clause 14 shall be deemed to
 be references to clause 3.6, above; (ii) the “Company” shall be deemed to be
 references to LBG; (iii) the “Joint Bookrunners”, “Banks” or any
 “Underwriter” shall be deemed to be references to the Treasury; (iv) any
 “Indemnified Person” shall be deemed to be references to any Relevant Person;
 (v) the “Rights Issue (excluding the HMT Shares)” shall be deemed to be
 references to the subscription by the Treasury of the HMT Rights Issue Shares;
 and (vi) the “Underwritten Shares” shall be deemed to be references to the
 HMT Rights Issue Shares). For the purposes of this clause 3.8, each Relevant
 Person shall have the same rights to contribution as the Treasury. 

 
	
  

 	
  

 
	
 3.9

 	
 LBG acknowledges and agrees
 that: (i) no Relevant Person accepts any responsibility for the contents of,
 or makes any representation or warranty as to the accuracy, completeness or
 fairness of any information in, the Prospectus, either of the Exchange Offer
 Memoranda or the Circular (or any supplement or amendment to either of them);
 and (ii) no Relevant Person has authorised or will authorise the contents of
 the Prospectus, either of the Exchange Offer Memoranda or the Circular. LBG
 shall include a disclaimer to the above effect in the Prospectus, both of the
 Exchange Offer Memoranda and the Circular. 

 
	
  

 	
  

 
	
 3.10

 	
 Each of the Treasury and the
 Treasury Solicitor hereby irrevocably waives any statutory right to withdraw
 any acceptance which may arise pursuant to section 87Q(4) of the FSMA on the
 publication of a supplementary prospectus in connection with the Rights
 Issue. For the avoidance of doubt, this clause 3.10 shall be without
 prejudice to the Treasury’s rights under clause 2.2 and 15. 

 













	
  

 	
  

 	
  

 
	
 11

 
	
  

 
	
 4.

 	
 WARRANTIES 

 
	
  

 	
  

 
	
 4.1

 	
 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. 

 
	
  

 	
  

 	
  

 
	
 4.2

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

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 neither the Treasury, UK
 Financial Investments Limited nor any person acting on its or their behalf
 (other than any party to the Underwriting Agreement or any of their
 respective affiliates, as to whom the Treasury gives no undertaking) has
 engaged or will engage in any “directed selling efforts” (within the meaning
 of Rule 902(c) of Regulation S under the Securities Act) with respect to the
 HMT Rights Issue Shares, the PALs, the nil paid rights or the fully paid
 rights to the HMT Rights Issue Shares; and 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 neither the Treasury, UK
 Financial Investments Limited nor any person acting on its or their behalf
 (other than any party to the Underwriting Agreement or any of their
 respective affiliates, as to whom the Treasury gives no undertaking) has
 engaged or will engage in any form of “general solicitation” or “general
 advertising” (within the meaning of Rule 502(c) of Regulation D under the
 Securities Act) in the United States in connection with any offer or sale of
 the HMT Rights Issue Shares, the PALs, the nil paid rights or the fully paid
 rights to the HMT Rights Issue Shares or has offered or will offer to sell or
 solicited or will solicit offers to buy any of the HMT Rights Issue Shares,
 the PALs, the nil paid rights or the fully paid rights to the HMT Rights
 Issue Shares in any manner involving a public offering in the United States
 within the meaning of Section 4(2) of the Securities Act. 

 
	
  

 	
  

 	
  

 
	
 5.

 	
 TAX MATTERS 

 
	
  

 	
  

 
	
 5.1

 	
 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 

 













	
  

 	
  

 	
  

 
	
 12

 
	
  

 
	
  

 	
 amount payable shall be
 increased so as to ensure that the amount received by the Treasury (or any
 other Relevant Person) after such deduction or withholding (including, for
 the avoidance of doubt, any additional deduction or withholding required as a
 result of such increase) is equal to the amount which the Treasury (or such
 Relevant Person) would have received if no such deduction or withholding had
 been required. 

 
	
  

 	
  

 
	
 5.2

 	
 If the Treasury (or any other
 Relevant Person) 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 (or any other Relevant Person) for Tax
 purposes, the sum payable shall be increased so as to ensure that the amount
 retained by the Treasury (or such other Relevant Person) after the payment of
 such Tax (including, for the avoidance of doubt, any additional Tax payable
 as a result of such increase) is equal to the amount which the Treasury (or
 such other Relevant Person) would have retained in the absence of such Tax.
 This clause 5.2 shall not apply to the HMT Commitment Commission or to the
 extent that any such Tax has been taken into account as a result of the
 application of clause 1.3. 

 
	
  

 	
  

 
	
 5.3

 	
 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 (or any other Relevant Person) 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
 (or such other Relevant Person), within 14 days of the receipt of a valid VAT
 invoice, an additional sum equal to the amount of such VAT. 

 
	
  

 	
  

 
	
 5,4

 	
 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 (including under clause 3.6), 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 (or any other Relevant Person) (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 equal to any input VAT which was incurred by the Treasury (or such other
 Relevant Person) 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 (or any other Relevant
 Person) 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 (or such other Relevant Person), and the Treasury shall
 use reasonable endeavours to procure that the relevant third party issues a
 valid 

 













	
  

 	
  

 	
  

 
	
 13

 
	
  

 
	
  

 	
  

 	
 VAT invoice in respect of the
 Relevant Cost to LBG (or the relevant member of the Group).

 
	
  

 	
  

 	
  

 
	
 5.5

 	
 LBG shall pay and bear any Stamp
 Tax which is payable or paid (whether by the Treasury, any other Relevant
 Person or otherwise) in connection with the allotment and issue of the HMT
 Rights Issue Shares, the delivery of the HMT Rights Issue Shares and/or the
 acquisition of the HMT Rights Issue Shares in the manner contemplated by this
 Deed or the Underwriting Agreement or the execution, delivery, performance or
 enforcement of this Deed, and LBG shall indemnify the Treasury and each other
 Relevant Person on demand on an after-Tax basis in respect of such Stamp Tax,
 provided that this clause 5.5 shall not apply to: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 any Stamp Tax payable in respect
 of transfers of, or agreements to transfer, HMT Rights Issue Shares subsequent
 to any such HMT Rights Issue Shares having been acquired by the Treasury in
 the manner contemplated by this Deed; or 

 
	
  

 	
  

 	
  

 
	
  

 	
 (B)

 	
 any stamp duty chargeable at a
 rate determined under section 67 or 70 of the Finance Act 1986 or stamp duty
 reserve tax chargeable under section 93 or 96 of the Finance Act 1986. 

 
	
  

 	
  

 	
  

 
	
  

 	
 References in this clause 5.5 to
 HMT Rights Issue Shares include any interest in or rights to allotment of HMT
 Rights Issue Shares. 

 
	
  

 	
  

 
	
 5.6

 	
 If LBG (or any member of the
 Group) makes an increased payment to the Treasury or any other Relevant
 Person in accordance with clause 5.1 or 5.2 and the Treasury or such other
 Relevant Person (as the case may be) determines in good faith that it has
 obtained, utilised and retained a relief from Tax or a refund of Tax which is
 attributable to such increased payment made by LBG (or any member of the
 Group), then the Treasury or such other Relevant Person (as the case may be)
 shall reimburse to LBG (for itself or on behalf of the relevant member of the
 Group) as soon as reasonably practicable an amount equal to such proportion
 of the Tax so saved or refunded as will leave the Treasury or such other
 Relevant Person (as the case may be), after such reimbursement, in the same
 after-Tax position (having regard to the time value of money) that it would
 have been in if the circumstances giving rise to such additional payment had
 not arisen. For the avoidance of doubt, nothing in this Deed shall require
 the Treasury or any other Relevant Person to disclose any information in
 relation to its Tax affairs to LBG (or any other member of the Group) or any
 person acting for or on behalf of LBG (or any other member of the Group). 

 
	
  

 	
  

 
	
 5.7

 	
 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. 

 













	
  

 	
  

 	
  

 
	
 14

 
	
  

 
	
 6.

 	
 ANNOUNCEMENTS
 AND PUBLICITY 

 
	
  

 	
  

 
	
 6.1

 	
 Subject to the other provisions
 of this clause 6, 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) this
 Deed (or any ancillary matter); or (ii) the
 Treasury in connection with this Deed (each, a “Restricted Statement”), save for such Restricted Statements
 as are contained in the Press Announcement, the Prospectus or any supplement
 thereto. 

 
	
  

 	
  

 
	
 6.2

 	
 Notwithstanding clause 6.1, 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 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. 

 
	
  

 	
  

 
	
 6.3

 	
 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 6.2, 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. 

 
	
  

 	
  

 
	
 6.4

 	
 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. 

 
	
  

 	
  

 	
  

 
	
 6.5

 	
 Notwithstanding clause 6.1, 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 6 by or on behalf of any member of the Group. 

 













	
  

 	
  

 	
  

 	
  

 
	
 15

 
	
  

 
	
 7.

 	
 CONFIDENTIALITY;
 FREEDOM OF INFORMATION 

 
	
  

 	
  

 
	
 7.1

 	
 Each party (the  “firstparty”) shall
 treat as confidential any information that 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”). 

 
	
  

 	
  

 
	
 7.2

 	
 Each party shall: 

 
	
  

 	
  

 
	
  

 	
 (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 effect the
 Rights Issue or 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 7 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. 

 
	
  

 	
  

 	
  

 
	
 7.3

 	
 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 7.5(B), for the purposes of enabling or assisting such person to
 fulfil its functions). 

 
	
  

 	
  

 
	
 7.4

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

 
	
  

 	
  

 
	
 7.5

 	
 The restrictions in clauses 7.1
 and 7.2 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 

 













	
  

 	
  

 	
  

 
	
 16

 
	
  

 
	
  

 	
  

 	
 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 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. 

 
	
  

 	
  

 	
  

 
	
 7.6

 	
 The restrictions in clauses 7.1
 and 7.2 shall not prevent the Treasury or LBG from disclosing Confidential
 Information: 

 
	
  

 	
  

 
	
  

 	
 (A)

 	
 which is required by: (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; 

 
	
  

 	
  

 	
  

 
	
  

 	
 (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. 

 
	
  

 	
  

 	
  

 
	
 7.7

 	
 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 five
 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 

 













	
  

 	
  

 	
  

 
	
 17

 
	
  

 
	
  

 	
  

 	
 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. 

 
	
  

 	
  

 	
  

 
	
 7.8

 	
 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. 

 
	
  

 	
  

 	
  

 
	
 7.9

 	
 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. 

 
	
  

 	
  

 
	
 8.

 	
 ASSIGNMENT 

 
	
  

 	
  

 
	
 8.1

 	
 Following the Acceptance Date,
 the Treasury may effect a Transfer to any Government Entity on such terms as
 it considers appropriate. 

 
	
  

 	
  

 
	
 8.2

 	
 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”). 

 
	
  

 	
  

 
	
 8.3

 	
 If a notification is given by
 the Treasury pursuant to clause 8.2, 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. 

 
	
  

 	
  

 
	
 8.4

 	
 For the purpose of this clause
 8: 

 
	
  

 	
  

 
	
  

 	
 (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 the
 entry into of any arrangement whereby the Treasury agrees to hold in trust 

 













	
  

 	
  

 	
  

 
	
 18

 
	
  

 
	
  

 	
  

 	
 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 (vi) any other
 entity or person directly or indirectly owned or established by, or held on
 trust for, any of the foregoing. 

 
	
  

 	
  

 	
  

 
	
 9.

 	
 REMEDIES 

 
	
  

 	
  

 
	
 9.1

 	
 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. 

 
	
  

 	
  

 
	
 9.2

 	
 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. 

 
	
  

 	
  

 
	
 9.3

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

 
	
  

 	
  

 
	
 9.4

 	
 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. 

 
	
  

 	
  

 
	
 10.

 	
 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. 

 













	
  

 	
  

 
	
 19

 
	
  

 
	
 11.

 	
 NOTICES 

 
	
  

 	
  

 
	
 11.1

 	
 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. 

 
	
  

 	
  

 
	
 11.2

 	
 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

 	
 020 7356 2168

 
	
  

 	
  

 	
 120 George St

 	
  

 
	
  

 	
  

 	
 Edinburgh

 	
  

 
	
  

 	
  

 	
 Scotland EH2 4LH

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
  

 	
 Attention: Company Secretary

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 Treasury

 	
 1 Horse Guards Road

 	
 020 7270 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 11. 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.

 
	
  

 	
  

 
	
 11.3

 	
 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. 

 
	
  

 	
  

 	
  

 
	
 11.4

 	
 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. 

 
	
  

 	
  

 
	
 11.5

 	
 The
 provisions of this clause 11 shall not apply in relation to the service of
 Service Documents.

 













	
  

 	
  

 
	
 20

 
	
  

 
	
 12.

 	
 CONTRACTS
 (RIGHTS OF THIRD PARTIES) ACT 1999 

 
	
  

 	
  

 
	
 12.1

 	
 Clauses 3.6, 3.8 and 3.9 confer
benefits on certain persons named therein who are not a party to this Deed
(each, a “Third Party”). Clauses 3.6, 3.8 and 3.9 are intended to be
enforceable by each Third Party by virtue of the Contract (Rights of Third
Parties) Act 1999.  

 
	
  

 	
  

 	
  

 
	
 12.2

 	
 Other than in respect of clauses
 3.6, 3.8 and 3.9, 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. 

 
	
  

 	
  

 	
  

 
	
 12.3

 	
 No Third Party may enforce, or
 take any step to enforce, the provisions of clauses 3.6, 3.8 or 3.9 without
 the prior written consent of the Treasury, which may, if given, be given on
 and subject to such terms as the Treasury may determine. 

 
	
  

 	
  

 
	
 12.4

 	
 Notwithstanding clause 12.1, any
 amendment to this Deed may be effected without the consent of any Third
 Party. 

 
	
  

 	
  

 
	
 13.

 	
 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. 

 
	
  

 	
  

 
	
 14.

 	
 VARIATION 

 
	
  

 	
  

 
	
 14.1

 	
 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. 

 
	
  

 	
  

 
	
 14.2

 	
 LBG agrees with HM Treasury that
 it shall not amend, vary or supplement any term of the Underwriting Agreement
 at any time (except with regard to execution of any Re-Pricing Memorandum as
 contemplated by clause 2.5 of the Underwriting Agreement), without the prior
 written consent of the Treasury. 

 
	
  

 	
  

 
	
 15.

 	
 TERMINATION 

 
	
  

 	
  

 
	
 15.1

 	
 The Treasury shall be entitled
 to terminate this Deed if any of the conditions in clause 2 have not been
 satisfied by 31 December 2009. 

 
	
  

 	
  

 
	
 15.2

 	
 Any right of rescission is
 hereby expressly waived and excluded by the Treasury. 

 
	
  

 	
  

 
	
 16.

 	
 AGENT FOR
 SERVICE OF PROCESS 

 
	
  

 	
  

 
	
 16.1

 	
 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 

 













	
  

 	
  

 	
  

 
	
 21

 
	
  

 
	
  

 	
 and Wales by service on its
 agent effected in any manner permitted by the Civil Procedure Rules. 

 
	
  

 	
  

 
	
 16.2

 	
 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 16
 applying to service on an agent apply equally to service on a replacement
 agent. 

 
	
  

 	
  

 
	
 16.3

 	
 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. 

 
	
  

 	
  

 
	
 17.

 	
 GOVERNING LAW 

 
	
  

 	
  

 
	
  

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

 
	
  

 	
  

 
	
 18.

 	
 JURISDICTION 

 
	
  

 	
  

 
	
 18.1

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

 
	
  

 	
  

 
	
 18.2

 	
 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 18 shall be
 conclusive and binding upon it and may be enforced in any other jurisdiction.
 

 
	
  

 	
  

 
	
 18.3

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

 










22


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

 	
 )

 	
  

 	
 

 
	
 THE LORDS COMMISSIONERS OF HER

 	
 )

 	
  

 
	
 MAJESTY’S TREASURY

 	
 )

 	
 By:

 
	
  

 	
 )

 	
  

 	
 

 	
  

 
	
  

 	
 )
)

 	
  

 	
 

 
	
  

 	
 By:

 
	
  

 	
  

 	
  

 	
 

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
 Executed as
 a deed by two of

 	
 )

 	
  

 	
  

 
	
 LLOYDS BANKING GROUP PLC

 	
 )

 	
  

 	
  

 
	
 acting by a
 director and its secretary/two

 	
 )

 	
 By:

 	

  


 	
  

 
	
 directors

 	
 )

 	
  

 	
 

 	
  

 
	
  

 	
 )

 	
  

 	
 Director

 
	
  

 	
 )

 	
  

 	
  

 
	
  

 	
  

 	
 By:

 	

  


 	
  

 
	
  

 	
  

 	
  

 	
 

 	
  

 
	
  

 	
  

 	
  

 	
 Director/Secretary

 










22


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

 	
 )

 	
  

 	
  

 
	
 THE LORDS COMMISSIONERS OF HER

 	
 )

 	
  

 
	
 MAJESTY’S TREASURY

 	
 )

 	
 By:

 
	
  

 	
 )

 	
  

 	
 

 	
  

 
	
  

 	
 )
)

 	
  

 	
  

 
	
  

 	
 By:

 
	
  

 	
  

 	
  

 	
 

 	
  

 
	
  

 	
  

 	
  

 	
  

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

 	
 )

 	
  

 	
  

 
	
 )

 	
  

 	
 

 
	
 )
)
)

 	
 By:

 	
  

 
	
  

 	
 

 	
  

 
	
  

 	
  

 	
  

 	
  

 
	
  

 	
 )

 	
  

 	
 Director

 
	
  

 	
  

 	
  

 	
 

 
	
  

 	
  

 	
  

 
	
  

 	
 By:

 	

 	
 


 
	
  

 	
  

 	
  

 	
 

 	
  

 
	
  

 	
  

 	
  

 	
 Director/Secretary