Document:

EXHIBIT
      4.5

     

     

    
      

      

    

     

     

     

    LLOYDS
      TSB GROUP PLC

     

     

    and

     

     

    THE
      BANK OF NEW YORK

     

    As
      Depositary

     

     

    and

     

     

    OWNERS
      AND BENEFICIAL OWNERS OF

    AMERICAN
      DEPOSITARY SHARES

     

     

    Deposit
      Agreement

    

    (Registered—Series)

     

    
 

     

    Dated
      as of _______, 2007

     

     

     

    
 

    
      

    

    
      

    

     

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

    DEPOSIT
      AGREEMENT

     

    DEPOSIT
      AGREEMENT dated as of _______, 2007 among LLOYDS TSB GROUP PLC, a
      public limited company incorporated under the laws of Scotland (herein called
      the “Company”), THE BANK OF NEW YORK, a New York banking
      corporation (herein called the “Depositary”), and all Owners
      and Beneficial Owners from time to time of American Depositary Shares issued
      hereunder.

     

    W
      I T N E S S E T H :

     

    WHEREAS,
      the Company has duly authorized the issue from time to time of its U.S. Dollar
      Preference Shares (herein called Preference Shares), to be issued in one or
      more
      series and with such terms and provisions as shall be specified in or pursuant
      to one or more resolutions of its Board of Directors or an authorized committee
      thereof, or pursuant to authorization by any authorized executive director
      of
      the company; and

     

    WHEREAS,
      the Company desires to provide, as hereinafter set forth in this Deposit
      Agreement, for the deposit of Preference Shares (as hereinafter defined) of
      one
      or more Series (as hereinafter defined) of the Company from time to time with
      the Depositary or with the Custodian (as hereinafter defined) as agent of the
      Depositary for the purposes set forth in this Deposit Agreement, for the
      creation of American Depositary Shares of one or more corresponding Series
      representing the Preference Shares so deposited and for the execution and
      delivery of American Depositary Receipts evidencing the American Depositary
      Shares; and

     

    WHEREAS,
      the American Depositary Receipts are to be substantially in the form of Exhibit
      A annexed hereto, with appropriate insertions, modifications and omissions,
      as
      hereinafter provided in this Deposit Agreement;

     

    NOW,
      THEREFORE, in consideration of the premises set forth herein, it is agreed
      by
      and among the parties hereto as follows:

     

    ARTICLE
      1.  DEFINITIONS

     

    The
      following definitions shall for all purposes, unless otherwise clearly
      indicated, apply to the respective terms used in this Deposit
      Agreement:

     

    SECTION
      1.01  American
      Depositary Shares.

     

    The
      term “American Depositary Shares”
shall mean the American Depositary Shares, the securities representing the
      interests in the Deposited Securities and evidenced by the Receipts issued
      hereunder.  Each American Depositary Share shall represent the number
      of Preference Shares specified in Exhibit A to this Deposit 

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    Agreement,
      until there shall occur a distribution upon Deposited Securities covered by
      Section 4.03 or a change in Deposited Securities covered by Section 4.08 with
      respect to which additional Receipts are not executed and delivered, and
      thereafter American Depositary Shares shall represent the amount of Preference
      Shares or Deposited Securities specified in such Sections.

     

    SECTION
      1.02  Beneficial
      Owner.

     

    The
      term
“Beneficial Owner” shall mean each person owning from time to time any
      beneficial interest in the American Depositary Shares evidenced by any
      Receipt.

     

    SECTION
      1.03  Commission.

     

    The
      term
“Commission” shall mean the Securities and Exchange Commission of the United
      States or any successor governmental agency in the United States.

     

    SECTION
      1.04  Company.

     

    The
      term
“Company” shall mean Lloyds TSB Group plc, a public limited company incorporated
      in Scotland under the Companies Act 1985, as amended, and its
      successors.

     

    SECTION
      1.05  Custodian.

     

    The
      term
“Custodian” shall mean the principal London office of The Bank of New York, as
      agent of the Depositary for the purposes of this Deposit Agreement, or any
      other
      firm or corporation which may hereafter be appointed by the Depositary pursuant
      to the terms of Section 5.05, as substitute or additional custodian hereunder,
      as the context shall require and shall also mean all of them
      collectively.

     

    SECTION
      1.06  Deposit
      Agreement.

     

    The
      term
“Deposit Agreement” shall mean this Deposit Agreement, as the same may be
      amended from time to time in accordance with the provisions of this Deposit
      Agreement.

     

    SECTION
      1.07  Depositary;
      Corporate Trust Office.

     

    The
      term
“Depositary” shall mean The Bank of New York, a New York banking corporation,
      and any successor as depositary hereunder.  The term “Corporate Trust
      Office”, when used with respect to the Depositary, shall mean the office of the
      Depositary which at the date of this Agreement is 101 Barclay Street, New York,
      New York  10286.

     

     

    
      
        
        

      

      
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    SECTION
      1.08  Deposited
      Securities.

     

    The
      term
“Deposited Securities” as of any time shall mean Preference Shares at such time
      deposited or deemed to be deposited under this Deposit Agreement and any and
      all
      other securities, property and cash received by the Depositary or the Custodian
      in respect thereof and at such time held hereunder, subject as to cash to the
      provisions of Section 4.05.

     

    SECTION
      1.09  Dollars.

     

    The
      term
“Dollars” shall mean United States dollars.

     

    SECTION
      1.10  DTC.

     

    The
      term
      DTC shall mean The Depository Trust Company, or its successor.

     

    SECTION
      1.11  Foreign
      Registrar.

     

    The
      term
“Foreign Registrar” shall mean the entity that presently carries out the duties
      of registrar for the Preference Shares or any successor as registrar for the
      Preference Shares and any other appointed agent of the Company for the transfer
      and registration of Preference Shares.

     

    SECTION
      1.12  Owner.

     

    The
      term
“Owner” shall mean the person in whose name a Receipt is registered on the books
      of the Depositary maintained for such purpose.

     

    SECTION
      1.13  Preference
      Shares.

     

    The
      term “Preference Shares” shall mean
      U.S. Dollar Preference Shares of the Company that are validly issued and
      outstanding and fully paid, nonassessable and that were not issued in violation
      of any pre-emptive or similar rights of the holders of outstanding Preference
      Shares or interim certificates representing such Preference Shares; provided,
      however, that, if there shall occur any change in par value, a split-up or
      consolidation or any other reclassification or, upon the occurrence of an event
      described in Section 4.08, an exchange or conversion in respect of the
      Preference Shares of the Company, the term “Preference Shares” shall thereafter
      also mean the successor securities resulting from such change in nominal value,
      split-up or consolidation or such other reclassification or such exchange or
      conversion.

     

    SECTION
      1.14  Receipts.

     

    The
      term
“Receipts” shall mean the American Depositary Receipts issued hereunder
      evidencing American Depositary Shares.

     

     

    
      
        
        

      

      
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    SECTION
      1.15  Registrar.

     

    The
      term
“Registrar” shall mean any bank or trust company having an office in the Borough
      of Manhattan, The City of New York, which shall be appointed to register
      Receipts and transfers of Receipts as herein provided.

     

    SECTION
      1.16  Restricted
      Securities.

     

    The
      term
“Restricted Securities” shall mean Preference Shares, or Receipts representing
      Preference Shares, that are acquired directly or indirectly from the Company
      or
      any affiliate (as defined in Rule 144 under the Securities Act) of the Company
      in a transaction or chain of transactions not involving any public offering,
      or
      that are held by an officer, director (or person performing similar functions)
      or other affiliate of the Company, or that would require registration under
      the
      Securities Act in connection with the public offer and sale thereof in the
      United States, or that are subject to other restrictions on sale or deposit
      under the laws of the United States or the United Kingdom, or under a
      shareholder agreement or the articles of incorporation of the
      Company.

     

    SECTION
      1.17  Securities
      Act.

     

    The
      term
“Securities Act ” shall mean the United States Securities Act of 1933, as
      amended.

     

    SECTION
      1.18  Securities
      Exchange Act.

     

    The
      term
“Securities Exchange Act” shall mean the United States Securities Exchange Act
      of 1934, as amended.

     

    ARTICLE
      2.  FORM
      OF RECEIPTS, DEPOSIT OF PREFERENCE SHARES; EXECUTION AND DELIVERY, TRANSFER
      AND
      SURRENDER OF RECEIPTS

     

    SECTION
      2.01  Form
      and Transferability of Receipts.

     

    (a)  Definitive
      Receipts shall be substantially in the form set forth in Exhibit A annexed
      to
      this Deposit Agreement, with appropriate insertions, modifications and
      omissions, as hereinafter provided.  No Receipt shall be entitled to
      any benefits under this Deposit Agreement or be valid or obligatory for any
      purpose, unless such Receipt shall have been executed by the Depositary by
      the
      manual or facsimile signature of a duly authorized signatory of the Depositary
      and, if a Registrar for the Receipts shall have been appointed, countersigned
      by
      the manual signature of a duly authorized officer of the
      Registrar.  The Depositary shall maintain books on which each Receipt
      so executed and delivered as hereinafter provided and the transfer of each
      such
      Receipt shall be registered.  Receipts bearing the manual or facsimile
      signature of a duly authorized signatory of the Depositary who was at any time
      a
      proper signatory of the Depositary shall bind the 

     

     

    
      
        
        

      

      
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    Depositary,
      notwithstanding that such signatory has ceased to hold such office prior to
      the
      execution and delivery of such Receipts by the Registrar or did not hold such
      office on the date of issuance of such Receipts.

     

    The
      Receipts may be endorsed with or have incorporated in the text thereof such
      legends or recitals or modifications not inconsistent with the provisions of
      this Deposit Agreement as may be required (i) by the Depositary after
      consultation with the Company; or (ii) to comply with any applicable law or
      regulations or with the rules and regulations of any securities exchange upon
      which the American Depositary Shares may be listed or to conform with any usage
      with respect thereto, or to indicate any special limitations or restrictions
      to
      which any particular Receipts are subject by reason of the date or manner of
      issuance of the underlying Deposited Securities or otherwise.

     

    The
      Receipts shall bear a CUSIP number that is different from any CUSIP number
      that
      is or may be assigned to any other depositary receipt facility relating to
      the
      Preference Shares.

     

    (b)  Title
      to a
      Receipt (and to the American Depositary Shares evidenced thereby), when properly
      endorsed or accompanied by proper instruments of transfer, shall be transferable
      by delivery with the same effect as in the case of a negotiable instrument
      under
      the laws of New York; provided, however, that the Depositary and
      the Company, notwithstanding any notice to the contrary, may treat the Owner
      thereof as the absolute owner thereof for the purpose of determining the person
      entitled to distribution of dividends or other distributions or to any notice
      provided for in this Deposit Agreement and for all other purposes.

     

    SECTION
      2.02  Deposit
      of Preference Shares.

     

    Subject
      to
      the terms and conditions of this Deposit Agreement, Preference Shares or
      evidence of rights to receive Preference Shares may be deposited by delivery
      thereof to the Custodian hereunder, accompanied by any appropriate instrument
      or
      instruments of transfer, or endorsement, in form satisfactory to the Custodian,
      together with all such certifications as may be required by the Depositary
      or
      the Custodian in accordance with the provisions of this Deposit Agreement,
      and,
      if the Depositary requires, together with a written order directing the
      Depositary to execute and deliver to, or upon the written order of, the person
      or persons stated in such order, a Receipt or Receipts for the number of
      American Depositary Shares representing such deposited Preference
      Shares.

     

    No
      Preference Shares shall be accepted for deposit unless accompanied by evidence
      satisfactory to the Depositary that any necessary approval has been granted
      by
      any governmental body in the United Kingdom that is then performing the function
      of the regulation of currency exchange. If required by the Depositary,
      Preference Shares presented for deposit at any time, whether or not the transfer
      books of the Company or the Foreign Registrar, if applicable, are closed, shall
      also be accompanied by an 

     

     

    
      
        
        

      

      
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    agreement
      or assignment, or other instrument satisfactory to the Depositary, which will
      provide for the prompt transfer to the Custodian of any dividend, or right
      to
      subscribe for additional Preference Shares or to receive other property which
      any person in whose name the Preference Shares are or have been recorded may
      thereafter receive upon or in respect of such deposited Preference Shares,
      or in
      lieu thereof, such agreement of indemnity or other agreement as shall be
      satisfactory to the Depositary.

     

    At
      the
      request and risk and expense of any person proposing to deposit Preference
      Shares, and for the account of such person, the Depositary may receive
      certificates for Preference Shares to be deposited, together with the other
      instruments herein specified, for the purpose of forwarding such Preference
      Share certificates to the Custodian for deposit hereunder.

     

    Upon
      each
      delivery to a Custodian of a certificate or certificates for Preference Shares
      to be deposited hereunder, together with the other documents above specified,
      such Custodian shall, as soon as transfer and recordation can be accomplished,
      present such certificate or certificates to the Company or the Foreign
      Registrar, if applicable, for transfer and recordation of the Preference Shares
      being deposited in the name of the Depositary or its nominee or such Custodian
      or its nominee.

     

    Deposited
      Securities shall be held by the Depositary or by a Custodian for the account
      and
      to the order of the Depositary or at such other place or places as the
      Depositary shall determine.

     

    SECTION
      2.03  Execution
      and Delivery of Receipts.

     

    Upon
      receipt by any Custodian of any deposit pursuant to Section 2.02 hereunder
      (and
      in addition, if the transfer books of the Company or the Foreign Registrar,
      if
      applicable, are open, the Depositary may in its sole reasonable discretion
      require a proper acknowledgment or other evidence from the Company that any
      Deposited Securities have been recorded upon the books of the Company or the
      Foreign Registrar, if applicable, in the name of the Depositary or its nominee
      or such Custodian or its nominee), together with the other documents required
      as
      above specified, such Custodian shall notify the Depositary of such deposit
      and
      the person or persons to whom or upon whose written order a Receipt or Receipts
      are deliverable in respect thereof and the number of American Depositary Shares
      to be evidenced thereby.  Such notification shall be made by letter
      or, at the request, risk and expense of the person making the deposit, by cable,
      telex or facsimile transmission.  Upon receiving such notice from such
      Custodian, or upon the receipt of Preference Shares by the Depositary, the
      Depositary, subject to the terms and conditions of this Deposit Agreement,
      shall
      execute and deliver at its Corporate Trust Office, to or upon the order of
      the
      person or persons entitled thereto, a Receipt or Receipts, registered in the
      name or names and evidencing any authorized number of American Depositary Shares
      requested by such person or persons, but only upon payment to the Depositary
      of
      the fees and expenses of the Depositary for the execution and delivery of such
      Receipt or Receipts as provided in Section 5.09, and of all taxes and

     

     

    
      
        
        

      

      
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    governmental
      charges and fees and expenses payable in connection with such deposit and the
      transfer of the Deposited Securities.

     

    SECTION
      2.04  Registration
      of Transfer of Receipts; Combination and Split-up of Receipts.

     

    The
      Depositary, subject to the terms and conditions of this Deposit Agreement,
      shall
      register transfers of Receipts on its transfer books from time to time, upon
      any
      surrender of a Receipt, by the Owner in person or by a duly authorized attorney,
      properly endorsed or accompanied by proper instruments of transfer, and duly
      stamped as may be required by the laws of the State of New York and of the
      United States of America.  Thereupon the Depositary shall execute a
      new Receipt or Receipts and deliver the same to or upon the order of the person
      entitled thereto.

     

    The
      Depositary, subject to the terms and conditions of this Deposit Agreement,
      shall
      upon surrender of a Receipt or Receipts for the purpose of effecting a split-up
      or combination of such Receipt or Receipts, execute and deliver a new Receipt
      or
      Receipts for any authorized number of American Depositary Shares requested,
      evidencing the same aggregate number of American Depositary Shares as the
      Receipt or Receipts surrendered.

     

    The
      Depositary may appoint one or more co-transfer agents for the purpose of
      effecting transfers, combinations and split-ups of Receipts at designated
      transfer offices on behalf of the Depositary.  In carrying out its
      functions, a co-transfer agent may require evidence of authority and compliance
      with applicable laws and other requirements by Owners or persons entitled to
      Receipts and will be entitled to protection and indemnity to the same extent
      as
      the Depositary.

     

    SECTION
      2.05  Surrender
      of Receipts and Withdrawal of Preference Shares.

     

    Upon
      surrender at the Corporate Trust Office of the Depositary of a Receipt for
      the
      purpose of withdrawal of the Deposited Securities represented by the American
      Depositary Shares evidenced by such Receipt, and upon payment of the fee of
      the
      Depositary for the surrender of Receipts as provided in Section 5.09 and payment
      of all taxes and governmental charges payable in connection with such surrender
      and withdrawal of the Deposited Securities, and subject to the terms and
      conditions of this Deposit Agreement, the memorandum and articles of association
      of the Company and the terms of the Deposited Securities, the Owner of such
      Receipt shall be entitled to delivery, to him or upon his order, of the amount
      of Deposited Securities at the time represented by the American Depositary
      Shares evidenced by such Receipt.  Delivery of such Deposited
      Securities may be made by the delivery of (a) Preference Shares in the name
      of such Owner or as ordered by him or certificates properly endorsed or
      accompanied by proper instruments of transfer to such Owner or as ordered by
      him
      and (b) any other securities, property and cash to which such Owner is then
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    such
      Owner
      or as ordered by him.  Such delivery shall be made, as hereinafter
      provided, without unreasonable delay.

     

    A
      Receipt
      surrendered for such purposes may be required by the Depositary to be properly
      endorsed in blank or accompanied by proper instruments of transfer in blank,
      and
      if the Depositary so requires, the Owner thereof shall execute and deliver
      to
      the Depositary a written order directing the Depositary to cause the Deposited
      Securities being withdrawn to be delivered to or upon the written order of
      a
      person or persons designated in such order.  Thereupon the Depositary
      shall direct the Custodian to deliver at the office of such Custodian, subject
      to Sections 2.06, 3.01 and 3.02 and to the other terms and conditions of this
      Deposit Agreement, to or upon the written order of the person or persons
      designated in the order delivered to the Depositary as above provided, the
      amount of Deposited Securities represented by the American Depositary Shares
      evidenced by such Receipt, except that the Depositary may make delivery to
      such
      person or persons at the Corporate Trust Office of the Depositary of any
      dividends or distributions with respect to the Deposited Securities represented
      by the American Depositary Shares evidenced by such Receipt, or of any proceeds
      of sale of any dividends, distributions or rights, which may at the time be
      held
      by the Depositary.

     

    At
      the
      request, risk and expense of any Owner so surrendering a Receipt, and for the
      account of such Owner, the Depositary shall direct the Custodian to forward
      any
      cash or other property (other than rights) comprising, and forward a certificate
      or certificates and other proper documents of title for, the Deposited
      Securities represented by the American Depositary Shares evidenced by such
      Receipt to the Depositary for delivery at the Corporate Trust Office of the
      Depositary.  Such direction shall be given by letter or, at the
      request, risk and expense of such Owner, by cable, telex or facsimile
      transmission.

     

    SECTION
      2.06  Limitations
      on Execution and Delivery, Transfer and Surrender of Receipts.

     

    As
      a
      condition precedent to the execution and delivery, registration of transfer,
      split-up, combination or surrender of any Receipt or withdrawal of any Deposited
      Securities, the Depositary, Custodian or Registrar may require payment from
      the
      depositor of Preference Shares or the presenter of the Receipt of a sum
      sufficient to reimburse it for any tax or other governmental charge and any
      stock transfer or registration fee with respect thereto (including any such
      tax
      or charge and fee with respect to Preference Shares being deposited or
      withdrawn) and payment of any applicable fees as herein provided, may require
      the production of proof satisfactory to it as to the identity and genuineness
      of
      any signature, may require delivery of such certifications as the Company may
      from time to time specify in writing to the Depositary to assure the Company
      of
      compliance with the Securities Act and the rules and regulations thereunder
      and
      may also require compliance with any regulations the 

     

     

    
      
        
        

      

      
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    Depositary
      may establish consistent with the provisions of this Deposit Agreement,
      including, without limitation, this Section 2.06.

     

    The
      delivery of Receipts against deposit of Preference Shares generally or against
      deposit of particular Preference Shares may be suspended, or the transfer of
      Receipts in particular instances may be refused, or the registration of transfer
      of outstanding Receipts generally may be suspended, during any period when
      the
      transfer books of the Depositary are closed, or if any such action is deemed
      necessary or advisable by the Depositary or the Company at any time or from
      time
      to time because of any requirement of law or of any government or governmental
      body or commission, or under any provision of this Deposit Agreement or any
      provision governing the Deposited Securities, or for any other
      reason.  The Depositary shall as promptly as practicable notify the
      Company of any suspension or refusal under the preceding sentence that is
      outside the ordinary course of business.

     

    Notwithstanding
      anything to the contrary in this Deposit Agreement, the surrender of outstanding
      Receipts and withdrawal of Deposited Securities may not be suspended subject
      only to (i) temporary delays caused by closing the transfer books of the
      Depositary or the Company or the deposit of Preference Shares in connection
      with
      voting at a shareholders’ meeting, or the payment of dividends, (ii) the payment
      of fees, taxes and similar charges, and (iii) compliance with any U.S. or
      foreign laws or governmental regulations relating to the Receipts or to the
      withdrawal of the Deposited Securities.

     

    The
      Depositary shall not knowingly accept for deposit under this Deposit Agreement
      any Preference Shares that would be required to be registered under the
      provisions of the Securities Act for the public offer and sale thereof in the
      United States, unless a registration statement is in effect as to such
      Preference Shares for such offer and sale.

     

    Without
      limiting the foregoing, Preference Shares that the Depositary believes have
      been
      withdrawn from a restricted depositary receipt facility established or
      maintained by a depositary bank (including any such other facility maintained
      by
      the Depositary) may be accepted for deposit hereunder only if those Shares
      are
      not “restricted securities” within the meaning of Rule 144(a)(3) under the
      Securities Act, and the Depositary may, as a condition of accepting those
      Preference Shares for deposit hereunder, require the person depositing those
      Preference Shares to provide the Depositary with a certificate to the foregoing
      effect.

     

    SECTION
      2.07  Lost
      Receipts, etc.

     

    In
      case
      any Receipt shall be mutilated, destroyed, lost or stolen, the Depositary shall
      execute and deliver a new Receipt of like tenor in exchange and substitution
      for
      such mutilated Receipt upon cancellation thereof, or in lieu of and in
      substitution for such destroyed, lost or stolen Receipt.  Before the
      Depositary shall execute and deliver a new Receipt in substitution for a
      destroyed, lost or stolen Receipt, 

     

     

    
      
        
        

      

      
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    the
      Owner
      thereof shall have (a) filed with the Depositary (i) a request for such
      execution and delivery before the Depositary has notice that the Receipt has
      been acquired by a bona fide purchaser and (ii) a sufficient indemnity bond
      and
      (b) satisfied any other reasonable requirements imposed by the
      Depositary.

     

    SECTION
      2.08  Cancellation
      and Destruction of Surrendered Receipts.

     

    All
      Receipts surrendered to the Depositary shall be canceled by the
      Depositary.  The Depositary is authorized to destroy Receipts so
      canceled.

     

    SECTION
      2.09  Issuance
      in Series.

     

    If
      the
      Company issues Preference Shares in more than one class or series or that
      otherwise entitle their holders to rights that vary from the rights to which
      other Preference Shares entitle their holders, the following provisions shall
      apply, notwithstanding anything to the contrary in this Deposit
      Agreement:

     

    (a)  The
      word
“Series,” when used with respect to Preference Shares, shall mean all
      outstanding Preference Shares that entitle their holders to identical rights
      with respect to those Preference Shares, regardless of the title or any other
      designation that may be assigned to Preference Shares.

     

    (b)  The
      Depositary shall direct the Custodian to hold Preference Shares of a Series
      deposited under this Deposit Agreement, and other Deposited Securities it
      receives in respect of those Preference Shares in a segregated account different
      from the account in which it holds Preference Shares of any other
      Series.

     

    (c)  Preference
      Shares of each Series that are deposited under this Deposit Agreement shall
      be
      represented by a “Series” of American Depositary Shares separate from the
      American Depositary Shares representing Preference Shares of any other
      Series.  The Depositary shall assign a designation to each Series of
      American Depositary Shares and shall reflect in its records the series to which
      each American Depositary Share belongs.  Each series of American
      Depositary Shares shall be evidenced by a “Series” of Receipts separate from the
      Receipts evidencing American Depositary Shares of any other
      Series.  Each Receipt shall be marked to indicate the designation of
      the Series of the American Depositary Shares evidenced by that Receipt and
      to
      identify the Series of Preference Shares those American Depositary Shares
      represent.

     

    (d)  If
      the
      rights to which deposited Preference Shares of a Series entitle their holders
      are modified such that those rights become identical to the rights to which
      deposited Preference Shares of another Series entitle their holders, the
      Depositary shall cause the Custodian to combine the accounts in which the former
      separate Series of 

     

     

    
      
        
        

      

      
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    Preference
      Shares are held, the Series of American Depositary Shares representing those
      Preference Shares will automatically be combined into one Series of American
      Depositary Shares and the Depositary may take any action necessary or convenient
      to effect that combination.  At any time after that combination, the
      Owners of Receipts affected by that combination will be entitled to surrender
      their Receipts to the Depositary and receive Receipts reflecting the designation
      of the American Depositary Shares owned by them as a result of that
      combination.

    

     

    (e)
      Owners
      and Beneficial Owners of American Depositary Shares of a Series shall be
      entitled to rights under this Deposit Agreement only with respect to deposited
      Preference Shares of the corresponding Series and other Deposited Securities
      received in respect of deposited Preference Shares of that Series.

     

    SECTION
      2.10  Uncertificated
      American Depositary Shares; Direct Registration System.

     

    Notwithstanding
      anything to the
      contrary in this Deposit Agreement:

     

    (a)           American
      Depositary Shares may be certificated securities evidenced by Receipts or
      uncertificated securities.  The form of Receipt annexed as Exhibit A
      to this Deposit Agreement describes the terms and conditions of, and will be
      the
      prospectus required under the Securities Act for, both certificated and
      uncertificated American Depositary Shares.  Except for those
      provisions of this Deposit Agreement that by their nature do not apply to
      uncertificated American Depositary Shares, all the provisions of this Deposit
      Agreement shall apply, mutatis mutandis, to uncertificated American
      Depositary Shares as well as to certificated American Depositary Shares, and
      to
      Owners and holders of uncertificated American Depositary Shares as well as
      to
      Owners and holders of Receipts.

     

    (b)           (i)           The
      term “deliver”, or its noun form, when used with respect to Receipts, shall mean
      (A) book-entry transfer of American Depositary Shares to an account at DTC
      designated by the person entitled to such delivery,  (B) registration
      of American Depositary Shares not evidenced by a Receipt on the books of the
      Depositary in the name requested by the person entitled to such delivery
      and  mailing to that person of a statement confirming that
      registration or (C) if requested by the person entitled to such delivery,
      delivery at the Corporate Trust Office of the Depositary to the person entitled
      to such delivery of one or more Receipts evidencing American Depositary Shares
      registered in the name requested by that person.

     

               (ii)           The
      term “surrender”, when used with respect to Receipts, shall mean (A) one or more
      book-entry transfers of American Depositary Shares to the DTC account of the
      Depositary, (B) delivery to the Depositary at its Corporate Trust Office of
      an
      instruction to surrender American Depositary Shares not evidenced by a

     

     

    
      
        
        

      

      
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    Receipt  or
      (C) surrender to the Depositary at its Corporate Trust Office of one or more
      Receipts evidencing American Depositary Shares.

     

    (c)           American
      Depositary Shares not evidenced by Receipts shall be transferable as
      uncertificated registered securities under the laws of the State of New
      York.

     

    (d)           The
      Depositary shall have a duty to register a transfer in the case of
      uncertificated American Depositary Shares, upon receipt from the Owner of a
      proper instruction (including, for the avoidance of doubt, instructions through
      DRS and Profile as defined and provided in subsection (f) below).  The
      Depositary, upon surrender of a Receipt for the purpose of exchanging for
      uncertificated American Depositary Shares, shall cancel that Receipt and send
      the Owner a statement confirming that the Owner is the owner of the same number
      of uncertificated American Depositary Shares that the surrendered Receipt
      evidenced. The Depositary, upon receipt of a proper instruction (including,
      for
      the avoidance of doubt, instructions through DRS and Profile as provided in
      subsection (f) below) from the Owner of uncertificated American Depositary
      Shares for the purpose of exchanging for certificated American Depositary
      Shares, shall execute and deliver to the Owner a Receipt evidencing the same
      number of certificated American Depositary Shares.

     

    (e)           Upon
      satisfaction of the conditions for replacement of a Receipt that is mutilated,
      lost, destroyed or stolen, the Depositary shall deliver to the Owner the
      American Depositary Shares evidenced by that Receipt in uncertificated form
      unless otherwise requested by the Owner.

     

    (f)           (i)  The
      parties acknowledge that the Direct Registration System (“DRS”) and Profile
      Modification System (“Profile”) shall apply to uncertificated American
      Depositary Shares upon acceptance thereof to DRS by DTC.  DRS is the
      system administered by DTC pursuant to which the Depositary may register the
      ownership of uncertificated American Depositary Shares, which ownership shall
      be
      evidenced by periodic statements issued by the Depositary to the Owners entitled
      thereto.  Profile is a required feature of DRS which allows a DTC
      participant, claiming to act on behalf of an Owner of American Depositary
      Shares, to direct the Depositary to register a transfer of those American
      Depositary Shares to DTC or its nominee and to deliver those American Depositary
      Shares to the DTC account of that DTC participant without receipt by the
      Depositary of prior authorization from the Owner to register such
      transfer.

     

    (ii)  In
      connection with and
      in accordance with the arrangements and procedures relating to DRS/Profile,
      the
      parties understand that the Depositary will not verify, determine or otherwise
      ascertain that the DTC participant which is claiming to be acting on behalf
      of
      an Owner in requesting a registration of transfer and delivery as described
      in
      subsection (a) has the actual authority to act on behalf of the Owner
      (notwithstanding any requirements under the Uniform Commercial
      Code).  For the avoidance of doubt, the provisions of Sections 5.03
      and 5.08 shall apply to the matters 

     

     

    
      
        
        

      

      
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    arising
      from the use of the DRS.  The parties agree that the Depositary’s
      reliance on and compliance with instructions received by the Depositary through
      the DRS/Profile System and in accordance with this Deposit Agreement shall
      not
      constitute negligence or bad faith on the part of the Depositary.

     

    ARTICLE
      3.  CERTAIN
      OBLIGATIONS OF OWNERS AND BENEFICIAL OWNERS OF RECEIPTS

     

    SECTION
      3.01  Filing
      Proofs, Certificates and Other Information.

     

    Any
      person
      presenting Preference Shares for deposit or any Owner or Beneficial Owner of
      a
      Receipt may be required from time to time to file with the Depositary or the
      Custodian such proof of citizenship or residence, exchange control approval,
      or
      such information relating to the registration on the books of the Company or
      the
      Foreign Registrar, if applicable, to execute such certificates and to make
      such
      representations and warranties, as the Depositary may deem necessary or proper
      or as the Company may reasonably require by written request to the Depositary
      or
      the Custodian.  The Depositary may withhold the delivery or
      registration of transfer of any Receipt or the distribution of any dividend
      or
      sale or distribution of rights or of the proceeds thereof or the delivery of
      any
      Deposited Securities until such proof or other information is filed or such
      certificates are executed or such representations and warranties
      made.  The Depositary shall provide to the Company, as promptly as
      practicable, upon its written request, copies of any such proof of citizenship
      or residence or other information referred to above so requested, to the extent
      that disclosure is permitted under applicable law.

     

    SECTION
      3.02  Liability
      of Owner or Beneficial Owner for Taxes.

     

    If
      any tax
      or other governmental charge shall become payable by the Custodian or the
      Depositary with respect to any Receipt or any Deposited Securities represented
      by any Receipt, such tax or other governmental charge shall be payable by the
      Owner or Beneficial Owner of such Receipt to the Depositary.  The
      Depositary may refuse to effect any transfer of such Receipt or any withdrawal
      of Deposited Securities represented by American Depositary Shares evidenced
      by
      such Receipt until such payment is made, and may withhold any dividends or
      other
      distributions, or may sell for the account of the Owner or Beneficial Owner
      thereof any part or all of the Deposited Securities represented by the American
      Depositary Shares evidenced by such Receipt, and may apply such dividends or
      other distributions or the proceeds of any such sale in payment of such tax
      or
      other governmental charge and the Owner or Beneficial Owner of such Receipt
      shall remain liable for any deficiency.

     

    SECTION
      3.03  Warranties
      on Deposit of Preference Shares.

     

    Every
      person depositing Preference
      Shares under this Deposit Agreement shall be deemed thereby to represent and
      warrant that such Preference Shares and each certificate therefor, if
      applicable, are validly issued, fully paid, nonassessable and were 

     

     

    
      
        
        

      

      
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    not
      issued
      in violation of any preemptive or similar rights of the holders of outstanding
      Preference Shares and that the person making such deposit is duly authorized
      to
      do so.  Such representations and warranties shall survive the deposit
      of Preference Shares, delivery of Receipts, transfer of American Depositary
      Shares and surrender of Receipts and withdrawal of Deposited
      Securities.

     

    SECTION
      3.04  Disclosure
      of Interests.

     

    The
      Company may from time to time request Owners to provide information as to the
      capacity in which such Owners own or owned Receipts and regarding the identity
      of any other persons then or previously having a beneficial interest in such
      Receipts and the nature of such interest and various other
      matters.  Each Owner agrees to provide any information requested by
      the Company or the Depositary pursuant to this Section 3.04.  The
      Depositary agrees to comply with reasonable written instructions received from
      time to time from the Company requesting that the Depositary forward any such
      requests to the Owners and to forward to the Company any such responses to
      such
      requests received by the Depositary.

     

    ARTICLE
      4.  THE
      DEPOSITED SECURITIES

     

    SECTION
      4.01  Cash
      Distributions.

     

    Whenever
      the Depositary shall receive any cash dividend or other cash distribution on
      any
      Deposited Securities, the Depositary shall, as promptly as practicable, subject
      to the provisions of Section 4.05, convert such dividend or distribution into
      Dollars and shall distribute the amount thus received (net of the fees and
      expenses of the Depositary as provided in Section 5.09) to the Owners
      entitled thereto, in proportion to the number of American Depositary Shares
      representing such Deposited Securities held by them respectively;
provided, however, that in the event that the Company or the
      Depositary shall be required to withhold and does withhold from such cash
      dividend or such other cash distribution an amount on account of taxes, the
      amount distributed to the Owner of the Receipts evidencing American Depositary
      Shares representing such Deposited Securities shall be reduced
      accordingly.  The Depositary shall distribute only such amount,
      however, as can be distributed without attributing to any Owner a fraction
      of
      one cent.  Any such fractional amounts shall be rounded to the nearest
      whole cent (in the case of a fractional amount equal to half a cent such
      fractional amount shall be rounded up) and so distributed to Owners entitled
      thereto.  The Company or its agent will remit to the appropriate
      governmental agency in the United Kingdom all amounts withheld and owing to
      such
      agency.  The Depositary will forward to the Company or its agent such
      information from its records as the Company may reasonably request to enable
      the
      Company or its agent to file necessary reports with governmental agencies,
      and
      the Depositary or the Company or its agent may file any such reports necessary
      to obtain benefits under the applicable tax treaties for the Owners of
      Receipts.

     

     

    
      
        
        

      

      
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    SECTION
      4.02  Distributions
      Other Than Cash, Preference Shares or Rights.

     

    Subject
      to
      the provisions of Sections 4.11 and 5.09, whenever the Depositary shall
      receive any distribution other than a distribution described in
      Section 4.01, 4.03 or 4.04, the Depositary shall, after consultation with
      the Company to the extent practicable, as promptly as practicable, cause the
      securities or property received by it to be distributed to the Owners entitled
      thereto, after deduction or upon payment of any fees and expenses of the
      Depositary or any taxes or other governmental charges, in proportion to the
      number of American Depositary Shares representing such Deposited Securities
      held
      by them respectively, in any manner that the Depositary may deem equitable
      and
      practicable for accomplishing such distribution; provided,
however, that if in the opinion of the Depositary such distribution
      cannot be made proportionately among the Owners entitled thereto, or if for
      any
      other reason (including, but not limited to, any requirement that the Company
      or
      the Depositary withhold an amount on account of taxes or other governmental
      charges or that such securities must be registered under the Securities Act
      in
      order to be distributed to Owners or Beneficial Owners) the Depositary deems
      such distribution not to be feasible, the Depositary may, after consultation
      with the Company to the extent practicable, as promptly as practicable, adopt
      such method as it may reasonably deem equitable and practicable for the purpose
      of effecting such distribution, including, but not limited to, the public or
      private sale of the securities or property thus received, or any part thereof,
      and the net proceeds of any such sale (net of the fees and expenses of the
      Depositary as provided in Section 5.09) shall be distributed by the
      Depositary to the Owners entitled thereto, all in the manner and subject to
      the
      conditions described in Section 4.01.  The Depositary may withhold any
      distribution of securities under this Section 4.02 if it has not received
      satisfactory assurances from the Company that the distribution does not require
      registration under the Securities Act.  The Depositary may sell, by
      public or private sale, an amount of securities or other property it would
      otherwise distribute under this Section 4.02 that is sufficient to pay its
      fees
      and expenses in respect of that distribution.  To the extent that such
      securities or other property or the net proceeds thereof are not effectively
      distributed to Owners or applied to fees or expenses of the Depositary as
      provided in this Section 4.02, the same shall constitute Deposited Securities
      and each American Depositary Share shall thereafter also represent its
      proportionate interest in such securities, property or net
      proceeds.

     

    SECTION
      4.03  Distributions
      in Preference Shares.

     

    If
      any
      distribution upon any Deposited Securities consists of a dividend in, or free
      distribution of, Preference Shares, the Depositary may, and shall, if the
      Company shall so request in writing, distribute to the Owners of outstanding
      Receipts entitled thereto, in proportion to the number of American Depositary
      Shares representing such Deposited Securities held by them respectively,
      additional Receipts evidencing an aggregate number of American Depositary Shares
      representing the amount of Preference 

     

     

    
      
        
        

      

      
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    Shares
      received as such dividend or free distribution, subject to the terms and
      conditions of the Deposit Agreement with respect to the deposit of Preference
      Shares and the issuance of American Depositary Shares evidenced by Receipts,
      including the withholding of any tax or other governmental charge as provided
      in
      Section 4.11 and the payment of the fees and expenses of the Depositary as
      provided in Section 5.09 (and the Depositary may sell, by public or private
      sale, an amount of the Preference Shares received that is sufficient to pay
      its
      fees and expenses in respect of that distribution).  In lieu of
      delivering Receipts for fractional American Depositary Shares in any such case,
      the Depositary shall use reasonable efforts to sell the amount of Preference
      Shares represented by the aggregate of such fractions and distribute the net
      proceeds, all in the manner and subject to the conditions described in Section
      4.01.  If additional Receipts are not so distributed, each American
      Depositary Share shall thenceforth also represent the additional Preference
      Shares distributed upon the Deposited Securities represented
      thereby.

     

    SECTION
      4.04  Rights.

     

    In
      the
      event that the Company shall offer or cause to be offered to the holders of
      any
      Deposited Securities any rights to subscribe for additional Preference Shares
      or
      any rights of any other nature, the Depositary, after consultation with the
      Company, shall have discretion as to the procedure to be followed in making
      such
      rights available to any Owners or in disposing of such rights on behalf of
      any
      Owners and making the net proceeds available to such Owners or, if by the terms
      of such rights offering or for any other reason, the Depositary may not either
      make such rights available to any Owners or dispose of such rights and make
      the
      net proceeds available to such Owners, then the Depositary shall allow the
      rights to lapse.  If at the time of the offering of any rights the
      Depositary reasonably determines, after consultation with the Company, that
      it
      is lawful and feasible to make such rights available to all or certain Owners
      but not to other Owners, the Depositary may distribute to any Owner to whom
      it
      determines the distribution to be lawful and feasible, in proportion to the
      number of American Depositary Shares held by such Owner, warrants or other
      instruments therefor in such form as it deems reasonably
      appropriate.

     

    In
      circumstances in which rights would otherwise not be distributed, if an Owner
      of
      Receipts requests the distribution of warrants or other instruments in order
      to
      exercise the rights allocable to the American Depositary Shares of such Owner
      hereunder, the Depositary will make such rights available to such Owner upon
      written notice from the Company to the Depositary that (a) the Company has
      elected in its sole discretion to permit such rights to be exercised and (b)
      such Owner has executed such documents as the Company has determined in its
      sole
      discretion are reasonably required under applicable law.

     

    If
      the
      Depositary has distributed warrants or other instruments for rights to all
      or
      certain Owners, then upon instruction from such an Owner pursuant to such

     

     

    
      
        
        

      

      
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    warrants
      or other instruments to the Depositary from such Owner to exercise such rights,
      upon payment by such Owner to the Depositary for the account of such Owner
      of an
      amount equal to the purchase price of the Preference Shares to be received
      upon
      the exercise of the rights, and upon payment of the fees and expenses of the
      Depositary and any other charges as set forth in such warrants or other
      instruments, the Depositary shall, on behalf of such Owner, exercise the rights
      and purchase the Preference Shares, and the Company shall cause the Preference
      Shares so purchased to be delivered to the Depositary on behalf of such
      Owner.  As agent for such Owner, the Depositary will cause the
      Preference Shares so purchased to be deposited pursuant to Section 2.02 of
      this Deposit Agreement, and shall, pursuant to Section 2.03 of this Deposit
      Agreement, execute and deliver Receipts to such Owner.  In the case of
      a distribution pursuant to the second paragraph of this Section 4.04, such
      Receipts shall be legended in accordance with applicable U.S. law and shall
      be
      subject to the appropriate restrictions on sale, deposit, cancellation and
      transfer under such laws.

     

    If
      the
      Depositary reasonably determines in its discretion that it is not lawful and
      feasible to make such rights available to all or certain Owners, it shall use
      its reasonable efforts to sell the rights, warrants or other instruments in
      proportion to the number of American Depositary Shares held by the Owners to
      whom it has determined it may not lawfully or feasibly make such rights
      available, and allocate the net proceeds of such sales (net of the fees and
      expenses of the Depositary as provided in Section 5.09 and all taxes and
      governmental charges payable in connection with such rights and subject to
      the
      terms and conditions of this Deposit Agreement) for the account of such Owners
      otherwise entitled to such rights, warrants or other instruments, upon an
      averaged or other practical basis without regard to any distinctions among
      such
      Owners because of exchange restrictions or the date of delivery of any Receipt
      or otherwise and distribute such net proceeds to the Owners entitled to them
      as
      in the case of a distribution of cash.

     

    The
      Depositary will not offer rights to Owners unless both the rights and the
      securities to which such rights relate are either exempt from registration
      under
      the Securities Act  with respect to a distribution to all Owners or
      are registered under the provisions of such Act; provided, that nothing
      in this Deposit Agreement shall create any obligation on the part of the Company
      to file a registration statement with respect to such rights or underlying
      securities or to endeavor to have such a registration statement declared
      effective.  If an Owner of Receipts requests the distribution of
      warrants or other instruments, notwithstanding that there has been no such
      registration under the Securities Act, the Depositary shall not effect such
      distribution unless it has received an opinion from recognized counsel in the
      United States for the Company upon which the Depositary may rely that such
      distribution to such Owner is exempt from such registration.

     

    The
      Depositary shall not be responsible for any failure to determine that it may
      be
      lawful or feasible to make such rights available to Owners in general or any
      Owner in particular.

     

     

    
      
        
        

      

      
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    SECTION
      4.05  Conversion
      of Foreign Currency.

     

    Whenever
      the Depositary or the Custodian shall receive foreign currency, by way of
      dividends or other distributions or the net proceeds from the sale of
      securities, property or rights, and if at the time of the receipt thereof the
      foreign currency so received can in the judgment of the Depositary be converted
      on a reasonable basis into Dollars and the resulting Dollars transferred to
      the
      United States, the Depositary shall convert or cause to be converted, by sale
      or
      in any other manner that it may determine, such foreign currency into Dollars,
      and such Dollars shall be distributed to the Owners entitled thereto or, if
      the
      Depositary shall have distributed any warrants or other instruments which
      entitle the holders thereof to such Dollars, then to the holders of such
      warrants or instruments upon surrender thereof for cancellation.  Such
      distribution may be made upon an averaged or other practicable basis without
      regard to any distinctions among Owners on account of exchange restrictions,
      the
      date of delivery of any Receipt or otherwise and shall be net of any expenses
      of
      conversion into Dollars incurred by the Depositary as provided in
      Section 5.09.

     

    If
      such
      conversion or distribution can be effected only with the approval or license
      of
      any government or agency thereof, the Depositary shall file such application
      for
      approval or license, if any, as it may deem desirable.

     

    If
      at any
      time the Depositary or the Custodian shall determine that in its judgment any
      foreign currency received by the Depositary or the Custodian is not convertible
      on a reasonable basis into Dollars transferable to the United States, or if
      any
      approval or license of any government or agency thereof which is required for
      such conversion is denied or in the opinion of the Depositary is not obtainable,
      or if any such approval or license is not obtained within a reasonable period
      as
      determined by the Depositary, the Depositary may distribute the foreign currency
      (or an appropriate document evidencing the right to receive such foreign
      currency) received by the Depositary to, or in its discretion may hold such
      foreign currency uninvested and without liability for interest thereon for
      the
      respective accounts of, the Owners entitled to receive the same.

     

    If
      any
      such conversion of foreign currency, in whole or in part, cannot be effected
      for
      distribution to some of the Owners entitled thereto, the Depositary may in
      its
      discretion make such conversion and distribution in Dollars to the extent
      permissible to the Owners entitled thereto and may distribute the balance of
      the
      foreign currency received by the Depositary to, or hold such balance uninvested
      and without liability for interest thereon for the respective accounts of,
      the
      Owners entitled thereto.

     

    SECTION
      4.06  Fixing
      of Record Date.

     

    Whenever
      any cash dividend or other cash distribution shall become payable or any
      distribution other than cash shall be made, or whenever rights shall be issued
      with respect to the Deposited Securities, or whenever the Depositary shall
      receive 

     

     

    
      
        
        

      

      
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    notice
      of
      any meeting of holders of Preference Shares or other Deposited Securities,
      or
      whenever for any reason the Depositary causes a change in the number of
      Preference Shares that are represented by each American Depositary Share, or
      whenever the Depositary shall find it necessary or convenient, the Depositary
      shall fix a record date (which shall be as near as practicable to any
      corresponding record date set by the Company) (a) for the determination of
      the Owners who shall be (i) entitled to receive such dividend, distribution
      or rights or the net proceeds of the sale thereof or (ii) entitled to give
      instructions for the exercise of voting rights at any such meeting or (iii)
      who
      shall be responsible for any fee or charges assessed by the Depositary pursuant
      to this Deposit Agreement, or (b) on or after which each American
      Depositary Share will represent the changed number of Preference
      Shares.  Subject to the provisions of Sections 4.01 through 4.05
      and to the other terms and conditions of this Deposit Agreement, the Owners
      on
      such record date shall be entitled, as the case may be, to receive the amount
      distributable by the Depositary with respect to such dividend or other
      distribution or such rights or the net proceeds of sale thereof in proportion
      to
      the number of American Depositary Shares held by them respectively, to give
      voting instructions or to act in respect of any other such matter.

     

    SECTION
      4.07  Voting
      of Deposited Securities.

     

    Upon
      receipt from the Company of notice of any meeting or solicitation of proxies
      or
      consents of holders of Preference Shares or other Deposited Securities, the
      Depositary shall, if requested in writing by the Company, as soon as practicable
      thereafter, mail to the Owners a notice, the form of which notice shall be
      in
      the sole discretion of the Depositary, which shall contain (a) such
      information as is contained in such notice of meeting received by the Depositary
      from the Company, (b) a statement that the Owners as of the close of
      business on a specified record date will be entitled, subject to any applicable
      provision of Scottish law and of the articles of association and any similar
      document of the Company, to instruct the Depositary as to the exercise of the
      voting rights, if any, pertaining to the amount of Preference Shares or other
      Deposited Securities represented by their respective American Depositary Shares
      and (c) a statement as to the manner in which such instructions may be
      given.  Upon the written request of an Owner of a Receipt on such
      record date, received on or before the date established by the Depositary for
      such purpose, the Depositary shall endeavor, in so far as practicable, to vote
      or cause to be voted the amount of Preference Shares or other Deposited
      Securities represented by the American Depositary Shares evidenced by such
      Receipt in accordance with the instructions set forth in such request, including
      an express indication that, if the Depositary does not receive instructions,
      it
      may deem instructions to have been given under the last sentence of this
      paragraph to give a discretionary proxy to a person designated by the
      Company.  Upon the written request of an Owner of a Receipt on that
      record date, received on or before the date established by the Depositary for
      the purpose, the Depositary shall endeavor, in so far as practicable, to vote
      or
      cause to be voted the amount of Preference Shares or other Deposited Securities
      represented by the American Depositary Shares evidenced by that Receipt in
      accordance with the 

     

     

    
      
        
        

      

      
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    instructions
      set forth in that request.  The Depositary shall not vote or attempt
      to exercise the right to vote that attaches to such Preference Shares or other
      Deposited Securities other than in accordance with instructions received from
      Owners or deemed received under the following sentence.  If (i) the
      Company made a request to the Depositary as contemplated by the first sentence
      of this Section 4.07 and complied with the following paragraph of this Section
      4.07 and (ii)  no instructions are received by the Depositary from an
      Owner with respect to an amount of Deposited Securities represented by the
      American Depositary Shares evidenced by that Owner’s Receipts on or before the
      date established by the Depositary for that purpose, the Depositary shall deem
      that Owner to have instructed the Depositary to give, and the Depositary shall
      give, a discretionary proxy to a person designated by the Company with respect
      to that amount of Deposited Securities, except that such instruction shall
      not
      be deemed to have been given and the Depositary shall not give a discretionary
      proxy with respect to any matter as to which the Company informs the Depositary
      (and the Company agrees to provide that information as promptly as practicable
      in writing, if applicable) that (x) the Company does not wish to receive a
      discretionary proxy, (y) substantial opposition exists or (z) the matter
      materially and adversely affects the rights of holders of Preference
      Shares.

     

    In
      order
      to give Owners a reasonable opportunity to instruct the Depositary as to the
      exercise of voting rights relating to Deposited Securities, if the Company
      requests the Depositary to act under the first sentence of this Section 4.07,
      the Company shall give the Depositary notice of any such meeting or solicitation
      not less than 30 days prior to the meeting date or date for giving such proxies
      or consents.

     

    SECTION
      4.08  Changes
      Affecting Deposited Securities.

     

    In
      circumstances where the provisions of Section 4.03 do not apply, upon any
      change in nominal value, change in par value, split-up, consolidation or any
      other reclassification of Deposited Securities, or upon any recapitalization,
      reorganization, merger or consolidation or sale of assets affecting the Company
      or to which it is a party, any securities which shall be received by the
      Depositary or a Custodian in exchange for or in conversion of or in respect
      of
      Deposited Securities, shall be treated as new Deposited Securities under this
      Deposit Agreement, and American Depositary Shares shall thenceforth represent,
      in addition to the existing Deposited Securities, the right to receive the
      new
      Deposited Securities so received in exchange or conversion, unless additional
      Receipts are delivered pursuant to the following sentence.  In any
      such case the Depositary may execute and deliver additional Receipts as in
      the
      case of a dividend in Preference Shares, or call for the surrender of
      outstanding Receipts to be exchanged for new Receipts specifically describing
      such new Deposited Securities.

     

    SECTION
      4.09  Reports.

     

    The
      Depositary shall make available for inspection by Owners at its Corporate Trust
      Office any reports and communications, including any proxy soliciting material,
      received from the Company which are both (a) received by the Depositary as

     

     

    
      
        
        

      

      
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    the
      holder
      of the Deposited Securities and (b) made generally available to the holders
      of such Deposited Securities by the Company.  The Depositary shall
      also send to the Owners copies of such reports when furnished by the Company
      pursuant to Section 5.06.  Any such reports and communications,
      including any such proxy soliciting material, furnished to the Depositary by
      the
      Company shall be furnished in English, to the extent such materials are required
      to be translated into English pursuant to any regulations of the
      Commission.

     

    SECTION
      4.10  Lists
      of Owners.

     

    Promptly
      upon request by the Company, the Depositary shall, at the expense of the
      Company, furnish to it a list, as of a recent date, of the names, addresses
      and
      holdings of American Depositary Shares by all persons in whose names Receipts
      are registered on the books of the Depositary.

     

    SECTION
      4.11  Withholding.

     

    In
      the event that the Depositary
      determines that any distribution in property (including Preference Shares and
      rights to subscribe therefor) is subject to any tax or other governmental charge
      which the Depositary is obligated to withhold, the Depositary may by public
      or
      private sale dispose of all or a portion of such property (including Preference
      Shares and rights to subscribe therefor) in such amounts and in such manner
      as
      the Depositary reasonably deems necessary and practicable to pay such taxes
      or
      charges and the Depositary shall distribute the net proceeds of any such sale
      after deduction of such taxes or charges to the Owners entitled thereto in
      proportion to the number of American Depositary Shares held by them
      respectively.

     

    SECTION
      4.12  Redemption
      of Deposited Securities.

     

    If
      the
      Depositary receives a notice that Deposited Securities are to be redeemed,
      the
      Depositary shall (i) call for surrender a corresponding number of American
      Depositary Shares, (ii) notify the Owners of those American Depositary Shares
      that the Deposited Securities underlying their American Depositary Shares will
      be surrendered for redemption and (iii) surrender Deposited Securities that
      have
      been redeemed to the issuer of those securities or its agent on the redemption
      date.  Owners of American Depositary Shares affected by the redemption
      may surrender the Receipts evidencing those American Depositary Shares and
      receive delivery of money or other property the Depositary receives upon
      redemption of Deposited Securities as provided in Section 2.05.

     

    If
      the
      Depositary receives notice that less than all the Deposited Securities are
      to be
      redeemed, the Depositary shall determine in its discretion which American
      Depositary Shares to call for surrender in connection with that
      redemption.   If the Depositary calls for surrender less than all
      the American Depositary Shares evidenced by a Receipt in connection with a
      redemption of Deposited Securities, the Depositary shall, upon surrender of
      that
      Receipt, deliver to the Owner a Receipt evidencing the amount of 

     

     

    
      
        
        

      

      
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    American
      Depositary Shares evidenced by the surrendered Receipt that were not called
      for
      surrender.

     

    ARTICLE
      5.  THE
      DEPOSITARY, THE CUSTODIANS AND THE COMPANY

     

    SECTION
      5.01  Maintenance
      of Office and Transfer Books by the Depositary.

     

    Until
      termination of this Deposit Agreement in accordance with its terms, the
      Depositary shall maintain in the Borough of Manhattan, The City of New York,
      facilities for the execution and delivery, registration, registration of
      transfers and surrender of Receipts in accordance with the provisions of this
      Deposit Agreement.

     

    The
      Depositary shall keep books, at its Corporate Trust Office, for the registration
      of Receipts and transfers of Receipts which at all reasonable times shall be
      open for inspection by the Owners, provided that such inspection shall not
      be
      for the purpose of communicating with Owners in the interest of a business
      or
      object other than the business of the Company or a matter related to this
      Deposit Agreement or the Receipts.

     

    The
      Depositary may close the transfer books, at any time or from time to time,
      when
      deemed expedient by it in connection with the performance of its duties
      hereunder and shall close them upon the reasonable written request of the
      Company.  The Depositary shall notify the Company of any closure under
      the preceding sentence that is outside the ordinary course of
      business.

     

    SECTION
      5.02  Prevention
      or Delay in Performance by the Depositary or the Company.

     

    Neither
      the Depositary nor the Company nor any of their respective directors, employees,
      agents or affiliates shall incur any liability to any Owner or Beneficial Owner
      if, by reason of any provision of any present or future law or regulation of
      the
      United States or any other country, or of any governmental or regulatory
      authority or stock exchange, or by reason of any provision, present or future,
      of the articles of association or any similar document of the Company, or by
      reason of any provision of any securities issued or distributed by the Company,
      or any offering or distribution thereof, or by reason of any act of God or
      war
      or terrorism or other circumstances beyond its control, the Depositary or the
      Company shall be prevented, delayed or forbidden from, or be subject to any
      civil or criminal penalty on account of, doing or performing any act or thing
      which by the terms of this Deposit Agreement or Deposited Securities it is
      provided shall be done or performed; nor shall the Depositary or the Company
      or
      any of their respective directors, employees, agents or affiliates incur any
      liability to any Owner or Beneficial Owner of any Receipt (i) by reason of
      any
      nonperformance or delay, caused as aforesaid, in the performance of any act
      or
      thing which by the terms of this Deposit Agreement it is provided shall or
      may
      be done or performed, (ii) by reason of any 

     

     

    
      
        
        

      

      
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    exercise
      of, or failure to exercise, any discretion provided for in this Deposit
      Agreement, (iii) for the inability of any Owner or Beneficial Owner to benefit
      from any distribution, offering, right or other benefit which is made available
      to holders of Deposited Securities but is not, under the terms of this Deposit
      Agreement, made available to Owners or Beneficial Owners or (iv) for any
      special, consequential or punitive damages for any breach of the terms of this
      Deposit Agreement.  Where, by the terms of a distribution pursuant to
      Section 4.01, 4.02, or 4.03, or an offering or distribution pursuant to
      Section 4.04, or for any other reason, such distribution or offering may
      not be made available to Owners, and the Depositary may not dispose of such
      distribution or offering on behalf of such Owners and make the net proceeds
      available to such Owners, then the Depositary shall not make such distribution
      or offering, and shall allow any rights, if applicable, to lapse.

     

    SECTION
      5.03  Obligations
      of the Depositary, the Custodian and the Company.

     

    The
      Company assumes no obligation nor shall it be subject to any liability under
      this Deposit Agreement to Owners or Beneficial Owners, except that it agrees
      to
      perform its obligations specifically set forth in this Deposit Agreement without
      negligence or bad faith.

     

    The
      Depositary assumes no obligation nor shall it be subject to any liability under
      this Deposit Agreement to any Owner or Beneficial Owner (including, without
      limitation, liability with respect to the validity or worth of the Deposited
      Securities), except that it agrees to perform its obligations specifically
      set
      forth in this Deposit Agreement without negligence or bad faith.

     

    Neither
      the Depositary nor the Company shall be under any obligation to appear in,
      prosecute or defend any action, suit or other proceeding in respect of any
      Deposited Securities or in respect of the Receipts on behalf of any Owner,
      Beneficial Owner or other person, and the Custodian shall not be under any
      obligation whatsoever with respect to such proceedings, the responsibility
      of
      the Custodian being solely to the Depositary.

     

    Neither
      the Depositary nor the Company shall be liable for any action or nonaction
      by it
      in reliance upon the advice of or information from legal counsel, accountants,
      any person presenting Preference Shares for deposit, any Owner or any other
      person believed by it in good faith to be competent to give such advice or
      information.  Each of the Company and the Depositary may rely and
      shall be protected in relying upon any written notice, request, direction or
      other document believed by it in good faith to be genuine and to have been
      signed or presented by the proper party or parties.

     

    The
      Depositary shall not be liable for any acts or omissions made by a successor
      depositary whether in connection with a previous act or omission of the
      Depositary or in  connection with any matter arising wholly after the
      removal or 

     

     

    
      
        
        

      

      
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    resignation
      of the Depositary, provided that in connection with the issue out of which
      such
      potential liability arises the Depositary performed its obligations without
      negligence or bad faith while it acted as Depositary.

     

    The
      Depositary shall not be responsible for any failure to carry out any
      instructions to vote any of the Deposited Securities, or for the manner in
      which
      any such vote is cast or the effect of any such vote, provided that any such
      action or nonaction is in good faith.

     

    No
      disclaimer of liability under the Securities Act is intended by any provision
      of
      this Deposit Agreement.

     

    SECTION
      5.04  Resignation
      and Removal of the Depositary.

     

    The
      Depositary may at any time resign as Depositary by written notice of its
      election so to do delivered to the Company, such resignation to take effect
      upon
      the appointment of a successor depositary and its acceptance of such appointment
      as hereinafter provided.

     

    The
      Depositary may at any time be removed by the Company by 60 days’ prior written
      notice of such removal, to become effective upon the later of (i) the 60th
      day
      after delivery of the notice to the Depositary or (ii) the appointment of a
      successor depositary and its acceptance of such appointment as hereinafter
      provided.

     

    In
      case at
      any time the Depositary acting hereunder shall resign or be removed, the Company
      shall use its best efforts to appoint a successor depositary, which shall be
      a
      bank or trust company having an office in the Borough of Manhattan, The City
      of
      New York.  Every successor depositary shall execute and deliver to its
      predecessor and to the Company an instrument in writing accepting its
      appointment hereunder, and thereupon such successor depositary, without any
      further act or deed, shall become fully vested with all the rights, powers,
      duties and obligations of its predecessor; but such predecessor, nevertheless,
      upon payment of all sums due it and on the written request of the Company shall
      execute and deliver an instrument transferring to such successor all rights
      and
      powers of such predecessor hereunder, shall duly assign, transfer and deliver
      all right, title and interest in the Deposited Securities to such successor,
      and
      shall deliver to such successor a list of the Owners of all outstanding
      Receipts.  Any such successor depositary shall promptly mail notice of
      its appointment to the Owners.

     

    Any
      corporation into or with which the Depositary may be merged or consolidated
      shall be the successor of the Depositary without the execution or filing of
      any
      document or any further act.

     

     

    
      
        
        

      

      
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    SECTION
      5.05  The
      Custodian.

     

    The
      Custodian shall be subject at all times and in all respects to the directions
      of
      the Depositary and shall be responsible solely to it.  The Custodian
      may resign and be discharged from its duties hereunder by notice of such
      resignation delivered to the Depositary at least 30 days prior to the date
      on which such resignation is to become effective.  If, upon such
      resignation there would be no Custodian acting under this Deposit Agreement,
      the
      Depositary shall, as promptly as practicable after receiving such notice,
      appoint a substitute custodian, which shall thereafter be a Custodian
      hereunder.  Whenever the Depositary in its discretion determines that
      it is in the best interest of the Owners to do so, it may appoint a substitute
      or additional custodian or custodians, each of which shall thereafter be a
      Custodian hereunder.  Upon demand of the Depositary, any Custodian
      shall deliver such of the Deposited Securities held by it as are requested
      of it
      to any other Custodian.  Each substitute or additional custodian shall
      deliver to the Depositary, forthwith upon its appointment, an acceptance of
      such
      appointment satisfactory in form and substance to the Depositary.  The
      Depositary shall notify the Company as promptly as practicable of any change
      in
      Custodian.

     

    Upon
      the
      appointment of any successor depositary hereunder, the Custodian then acting
      hereunder shall forthwith become, without any further act or writing, the agent
      hereunder of such successor depositary and the appointment of such successor
      depositary shall in no way impair the authority of each Custodian hereunder;
      but
      the successor depositary so appointed shall, nevertheless, on the written
      request of any Custodian, execute and deliver to that Custodian all such
      instruments as may be proper to give to that Custodian full and complete power
      and authority as agent hereunder of such successor depositary.

     

    SECTION
      5.06  Notices
      and Reports.

     

    On
      or
      before the first date on which the Company gives notice, by publication or
      otherwise, of any meeting of holders of Preference Shares or other Deposited
      Securities, or of any adjourned meeting of such holders, or of the taking of
      any
      action in respect of any cash or other distributions or the offering of any
      rights, the Company agrees to transmit to the Depositary and the Custodian
      a
      copy of the notice thereof in English but otherwise in the form given or to
      be
      given to holders of Preference Shares or other Deposited
      Securities.

     

    The
      Company will arrange for the translation into English, if not already in
      English, to the extent required pursuant to any regulations of the Commission,
      and the prompt transmittal by the Company to the Depositary and the Custodian
      of
      such notices and any other reports and communications which are made generally
      available by the Company to holders of its Preference Shares.  If
      requested in writing by the Company, the Depositary will arrange for the
      mailing, at the Company’s expense, of copies of such notices, reports and
      communications to all Owners.  The Company will timely provide the
      Depositary with the quantity of such notices, reports, and communications,
      as

     

     

    
      
        
        

      

      
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    requested
      by the Depositary from time to time, in order for the Depositary to effect
      such
      mailings.

     

    The
      Company will deliver to the Depositary and the Custodian a copy (in English
      or
      with an English translation) of all provisions of or governing the Preference
      Shares and any other Deposited Securities.  Promptly upon any change
      in such provisions, the Company shall deliver promptly to the Depositary and
      the
      Custodian a copy (in English or with an English translation) of such provisions
      as so changed.  The Depositary and its agents may rely on the copy of
      such provisions as so delivered for all purposes of this Deposit
      Agreement.

     

    SECTION
      5.07  Distribution
      of Additional Preference Shares, Rights, etc.

     

    If
      the
      Company or any affiliate of the Company determines to make any issuance or
      distribution of (1) additional Preference Shares, (2) rights to
      subscribe for Preference Shares, (3) securities convertible into Preference
      Shares, or (4) rights to subscribe for such securities (each a
“Distribution”), the Company shall notify the Depositary in writing in English
      as promptly as practicable and in any event before the Distribution starts
      and,
      if requested in writing by the Depositary, the Company shall promptly furnish
      to
      the Depositary a written opinion from U.S. counsel for the Company that is
      reasonably satisfactory to the Depositary, stating whether or not the
      Distribution requires, or, if made in the United States, would require,
      registration under the Securities Act.  If, in the opinion of that
      counsel, the Distribution requires, or, if made in the United States, would
      require, registration under the Securities Act, that counsel shall furnish
      to
      the Depositary a written opinion as to whether or not there is a registration
      statement under the Securities Act in effect that will cover that
      Distribution.  The Company shall be under no obligation to file a
      registration statement with respect to any Distribution.

     

    SECTION
      5.08  Indemnification.

     

    The
      Company agrees to indemnify the Depositary, its directors, employees, agents
      and
      affiliates and any Custodian against, and hold each of them harmless from,
      any
      liability or expense (including, but not limited to, the fees and expenses
      of
      counsel) that may arise out of or in connection with (a) any offer or sale
      of
      American Depositary Shares or Deposited Securities in the United States or
      (b)
      acts performed or omitted pursuant to the provisions of this Deposit Agreement
      and of the Receipts, as the same may be amended, modified or supplemented from
      time to time, (i) by either the Depositary or a Custodian or their
      respective directors, employees, agents and affiliates, except for any liability
      or expense arising out of the negligence or bad faith of either of them, or
      (ii) by the Company or any of its directors, employees, agents and
      affiliates.

     

    The
      Depositary agrees to indemnify the Company, its directors, employees, agents
      and
      affiliates and hold them harmless from any liability or expense which may arise
      out of acts performed or omitted by the Depositary or its Custodian or

     

     

    
      
        
        

      

      
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    their
      respective directors, employees, agents and affiliates due to their negligence
      or bad faith.

     

    SECTION
      5.09  Charges
      of Depositary.

     

    The
      Company agrees to pay the fees, reasonable expenses and out-of-pocket charges
      of
      the Depositary and those of any Registrar only in accordance with agreements
      in
      writing entered into between the Depositary and the Company from time to
      time.  The Depositary shall present its statement for such charges and
      expenses to the Company once every three months.  The charges and
      expenses of the Custodian are for the sole account of the
      Depositary.

     

    The
      following charges shall be incurred by any party depositing or withdrawing
      Preference Shares or by any party surrendering Receipts or to whom Receipts
      are
      issued (including, without limitation, issuance pursuant to a stock dividend
      or
      stock split declared by the Company or an exchange of stock regarding the
      Receipts or Deposited Securities or a distribution of Receipts pursuant to
      Section 4.03) or by Owners, as applicable:  (1) taxes and
      other governmental charges, (2) such registration fees as may from time to
      time be in effect for the registration of transfers of Preference Shares
      generally on the share register of the Company or Foreign Registrar and
      applicable to transfers of Preference Shares to the name of the Depositary
      or
      its nominee or the Custodian or its nominee on the making of deposits or
      withdrawals hereunder, (3) such cable, telex and facsimile transmission
      expenses as are expressly provided in this Deposit Agreement, (4) such
      expenses as are incurred by the Depositary in the conversion of foreign currency
      pursuant to Section 4.05, (5) a fee of $5.00 or less per 100 American
      Depositary Shares (or portion thereof) for the execution and delivery of
      Receipts pursuant to Section 2.03, 4.03 or 4.04 and the surrender of
      Receipts pursuant to Section 2.05 or 6.02, (6)  a fee of $.02 or less
      per American Depositary Share (or portion thereof) for any cash distribution
      made pursuant to this Deposit Agreement, including, but not limited to Sections
      4.01 through 4.04, (7) a fee for the distribution of securities pursuant to
      Section 4.02, such fee being in an amount equal to the fee for the
      execution and delivery of American Depositary Shares referred to above which
      would have been charged as a result of the deposit of such securities (for
      purposes of this clause 7 treating all such securities as if they were
      Preference Shares) but which securities are instead distributed by the
      Depositary to Owners, (8) a fee of $.02 or less per American Depositary Share
      (or portion thereof) for depositary services, which will accrue on the last
      day
      of each calendar year and will be payable as provided in clause 9 below and
      (9)
      any other charges payable by the Depositary, any of the Depositary’s agents,
      including the Custodian, or the agents of the Depositary’s agents in connection
      with the servicing of Preference Shares or other Deposited Securities (which
      charge shall be assessed against Owners as of the date or dates set by the
      Depositary in accordance with Section 4.06 and shall be collected at the sole
      discretion of the Depositary by billing such Owners for such charge or by
      deducting such charge from one or more cash dividends or other cash
      distributions).

     

     

    
      
        
        

      

      
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    The
      Depositary may own and deal in any class of securities of the Company and its
      affiliates and in Receipts.

     

    SECTION
      5.10  Retention
      of Depositary Documents.

     

    The
      Depositary is authorized to destroy those documents, records, bills and other
      data compiled during the term of this Deposit Agreement at the times permitted
      by the laws or regulations governing the Depositary unless the Company
      reasonably requests that such papers be retained for a longer
      period.

     

    SECTION
      5.11  Exclusivity.

     

    The
      Company agrees not to appoint any other depositary for issuance of American
      or
      global depositary receipts so long as The Bank of New York is acting as
      Depositary hereunder.

     

    ARTICLE
      6.  AMENDMENT
      AND TERMINATION

     

    SECTION
      6.01  Amendment.

     

    The
      form
      of the Receipts and any provisions of this Deposit Agreement may at any time
      and
      from time to time be amended by agreement between the Company and the Depositary
      without the consent of Owners or Beneficial Owners in any respect which they
      may
      deem necessary or desirable.  Any amendment which shall impose or
      increase any fees or charges (other than taxes and other governmental charges,
      registration fees, cable, telex or facsimile transmission costs, delivery costs
      or other such expenses), or which shall otherwise prejudice any substantial
      existing right of Owners, shall, however, not become effective as to outstanding
      Receipts until the expiration of 30 days after notice of such amendment shall
      have been given to the Owners of outstanding Receipts.  Every Owner
      and Beneficial Owner, at the time any amendment so becomes effective, shall
      be
      deemed, by continuing to hold such Receipt or any interest therein, to consent
      and agree to such amendment and to be bound by the Deposit Agreement as amended
      thereby.  In no event shall any amendment impair the right of the
      Owner of any Receipt to surrender such Receipt and receive therefor the
      Deposited Securities represented thereby, except in order to comply with
      mandatory provisions of applicable law.

     

    SECTION
      6.02  Termination.

     

    The
      Depositary shall, at any time at the direction of the Company, terminate this
      Deposit Agreement by mailing notice of termination to the Owners of all Receipts
      then outstanding at least 30 days prior to the date fixed in such notice for
      such termination.  The Depositary may likewise terminate this Deposit
      Agreement by mailing notice of termination to the Company and the Owners of
      all
      Receipts then outstanding if at least 60 days  have passed since the
      Depositary delivered to the Company a written 

     

     

     

    
      
        
        

      

      
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    notice
      of
      its election to resign and a successor depositary has not been appointed and
      accepted its appointment as provided in Section 5.04.  On and
      after the date of termination, the Owner of a Receipt will, upon
      (a) surrender of such Receipt at the Corporate Trust Office of the
      Depositary, (b) payment of the fee of the Depositary for the surrender of
      Receipts referred to in Section 2.05, and (c) payment of any
      applicable taxes or governmental charges, be entitled to delivery, to him or
      upon his order, of the amount of Deposited Securities represented by the
      American Depositary Shares evidenced by such Receipt.  If any Receipts
      shall remain outstanding after the date of termination, the Depositary
      thereafter shall discontinue the registration of transfers of Receipts, shall
      suspend the distribution of dividends to the Owners thereof, and shall not
      give
      any further notices or perform any further acts under this Deposit Agreement,
      except that the Depositary shall continue to collect dividends and other
      distributions pertaining to Deposited Securities, shall sell rights and other
      property as provided in this Deposit Agreement, and shall continue to deliver
      Deposited Securities, together with any dividends or other distributions
      received with respect thereto and the net proceeds of the sale of any rights
      or
      other property, in exchange for Receipts surrendered to the Depositary (after
      deducting, in each case, the fee of the Depositary for the surrender of a
      Receipt, any expenses for the account of the Owner of such Receipt in accordance
      with the terms and conditions of this Deposit Agreement, and any applicable
      taxes or governmental charges).  At any time after the expiration of
      one year from the date of termination, the Depositary may sell the Deposited
      Securities then held hereunder and may thereafter hold uninvested the net
      proceeds of any such sale, together with any other cash then held by it
      hereunder, unsegregated and without liability for interest, for the pro rata
      benefit of the Owners of Receipts which have not theretofore been surrendered,
      such Owners thereupon becoming general creditors of the Depositary with respect
      to such net proceeds.  After making such sale, the Depositary shall be
      discharged from all obligations under this Deposit Agreement, except to account
      for such net proceeds and other cash (after deducting, in each case, the fee
      of
      the Depositary for the surrender of a Receipt, any expenses for the account
      of
      the Owner of such Receipt in accordance with the terms and conditions of this
      Deposit Agreement, and any applicable taxes or governmental
      charges).  Upon the termination of this Deposit Agreement, the Company
      shall be discharged from all obligations under this Deposit Agreement except
      for
      its obligations to the Depositary under Sections 5.08 and
      5.09.

     

    ARTICLE
      7.  MISCELLANEOUS

     

    SECTION
      7.01  Counterparts.

     

    This
      Deposit Agreement may be executed in any number of counterparts, each of which
      shall be deemed an original and all of such counterparts shall constitute one
      and the same instrument.  Copies of this Deposit Agreement shall be
      filed with the Depositary and the Custodians and shall be open to inspection
      by
      any Owner or Beneficial Owner during business hours.

     

     

    
      
        
        

      

      
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          29
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    SECTION
      7.02  No
      Third Party Beneficiaries.

     

    This
      Deposit Agreement is for the exclusive benefit of the parties hereto and shall
      not be deemed to give any legal or equitable right, remedy or claim whatsoever
      to any other person.

     

    SECTION
      7.03  Severability.

     

    In
      case
      any one or more of the provisions contained in this Deposit Agreement or in
      the
      Receipts should be or become invalid, illegal or unenforceable in any respect,
      the validity, legality and enforceability of the remaining provisions contained
      herein or therein shall in no way be affected, prejudiced or disturbed
      thereby.

     

    SECTION
      7.04  Owners
      and Beneficial Owners as Parties;  Binding Effect.

     

    The
      Owners
      and Beneficial Owners of Receipts from time to time shall be parties to this
      Deposit Agreement and shall be bound by all of the terms and conditions hereof
      and of the Receipts by acceptance thereof or any interest therein.

     

    SECTION
      7.05  Notices.

     

    Any
      and
      all notices to be given to the Company shall be deemed to have been duly given
      if personally delivered or sent by mail or cable, telex or facsimile
      transmission confirmed by letter, addressed to the Company at Lloyds TSB Group
      plc, 25 Gresham Street, London  EC2V 7HN, United Kingdom,
      Attention:  Company Secretary, Facsimile:  +44 20 7356 1038,
      or any other place to which the Company may have transferred its principal
      office with notice to the Depositary.

     

    Any
      and
      all notices to be given to the Depositary shall be deemed to have been duly
      given if in English and personally delivered or sent by mail or cable, telex
      or
      facsimile transmission confirmed by letter, addressed to The Bank of
      New York, 101 Barclay Street, New York, New York 10286,
      Attention:  American Depositary Receipt Administration, Facsimile:
      (212) 571-3050 or any other place to which the Depositary may have transferred
      its Corporate Trust Office with notice to the Company.

     

    Any
      and
      all notices to be given to any Owner shall be deemed to have been duly given
      if
      personally delivered or sent by mail or cable, telex or facsimile transmission
      confirmed by letter, addressed to such Owner at the address of such Owner as
      it
      appears on the transfer books for Receipts of the Depositary, or, if such Owner
      shall have filed with the Depositary a written request that notices intended
      for
      such Owner be mailed to some other address, at the address designated in such
      request.

     

    Delivery
      of a notice sent by mail or cable, telex or facsimile transmission shall be
      deemed to be effective at the time when a duly addressed letter containing
      the
      same (or a confirmation thereof in the case of a cable, telex or facsimile
      transmission) is 

     

     

    
      
        
        

      

      
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          30
          -

        
          

        

      

      
        
        

      

    

     

     

    deposited,
      postage prepaid, in a post-office letter box.  The Depositary or the
      Company may, however, act upon any cable, telex or facsimile transmission
      received by it, notwithstanding that such cable, telex or facsimile transmission
      shall not subsequently be confirmed by letter as aforesaid.

     

    SECTION
      7.06  Submission
      to Jurisdiction; Appointment of Agent for Service of Process.

     

    The
      Company hereby (i) irrevocably designates and appoints Kevin P. McKendry,
      Chief US Counsel, Lloyds TSB Bank plc, 1251 Avenue of the Americas, New York,
      New York 10020, as the Company’s authorized agent upon which process may be
      served in any suit or proceeding arising out of or relating to the Preference
      Shares or Deposited Securities, the American Depositary Shares, the Receipts
      or
      this Deposit Agreement, (ii) consents and submits to the jurisdiction of any
      state or federal court in the State of New York in which any such suit or
      proceeding may be instituted, and (iii) agrees that service of process upon
      said
      authorized agent shall be deemed in every respect effective service of process
      upon the Company in any such suit or proceeding.  The Company agrees
      to deliver, upon the execution and delivery of this Deposit Agreement, a written
      acceptance by such agent of its appointment as such agent.  The
      Company further agrees to take any and all action, including the filing of
      any
      and all such documents and instruments, as may be necessary to continue such
      designation and appointment in full force and effect for so long as any American
      Depositary Shares or Receipts remain outstanding or this Agreement remains
      in
      force.  In the event the Company fails to continue such designation
      and appointment in full force and effect, the Company hereby waives personal
      service of process upon it and consents that any such service of process may
      be
      made by certified or registered mail, return receipt requested, directed to
      the
      Company at its address last specified for notices hereunder, and service so
      made
      shall be deemed completed ten (10) days after the same shall have been so
      mailed.

     

    SECTION
      7.07  WAIVER
      OF JURY TRIAL.

     

    EACH
      PARTY HERETO HEREBY WAIVES, TO THE
      FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL
      BY
      JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
      TO THIS DEPOSIT AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY (WHETHER
      BASED
      ON CONTRACT, TORT OR ANY OTHER THEORY).  EACH PARTY HERETO (A)
      CERTIFIES THAT NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS
      REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE
      EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES
      THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS
      DEPOSIT AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS
      IN THIS SECTION.

     

     

    
      
        
        

      

      
        -
          31
          -

        
          

        

      

      
        
        

      

    

     

     

    SECTION
      7.08  Governing
      Law.

     

    This
      Deposit Agreement and the Receipts shall be interpreted in accordance with,
      and
      all rights hereunder and thereunder and provisions hereof and thereof shall
      be
      governed by, the laws of the State of New York.

     

    SECTION
      7.09  Waiver
      of Immunities.

     

    To
      the
      extent that the Company or any of its properties, assets or revenues may have
      or
      may hereafter become entitled to, or have attributed to it, any right of
      immunity, on the grounds of sovereignty or otherwise, from any legal action,
      suit or proceeding, from the giving of any relief in any respect thereof, from
      setoff or counterclaim, from the jurisdiction of any court, from service of
      process, from attachment upon or prior to judgment, from attachment in aid
      of
      execution or judgment, or from execution of judgment, or other legal process
      or
      proceeding for the giving of any relief or for the enforcement of any judgment,
      in any jurisdiction in which proceedings may at any time be commenced, with
      respect to its obligations, liabilities or any other matter under or arising
      out
      of or in connection with the Preference Shares or Deposited Securities, the
      American Depositary Shares, the Receipts or this Deposit Agreement, the Company,
      to the fullest extent permitted by law, hereby irrevocably and unconditionally
      waives, and agrees not to plead or claim, any such immunity and consents to
      such
      relief and enforcement.

     

    

     

    
      
        
        

      

      
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          32
          -

        
          

        

      

      
        
        

      

    

     

    
 

    IN
      WITNESS
      WHEREOF, LLOYDS TSB GROUP plc and THE BANK OF NEW YORK have duly executed
      this Deposit Agreement as of the day and year first set forth above and all
      Owners and Beneficial Owners shall become parties hereto upon acceptance by
      them
      of American Depositary Shares issued in accordance with the terms hereof or
      any
      interest therein.

     

    LLOYDS
      TSB
      GROUP plc

     

     

    By:  ___________________________

    Name:
      _____________________

    Title:
      ______________________

     

     

    THE
      BANK
      OF NEW YORK,

    as
      Depositary

     

     

    By:
      ___________________________

    Name:
      _____________________

    Title:
      ______________________

     

    
      
        
        

      

      
        -
          33
          -

        
          

        

      

      
        
        

      

    

     

    
 

    EXHIBIT
      A

     

    No.                                                                   

    _________________________________
AMERICAN
      DEPOSITARY SHARES

     

    (Each
      American Depositary Share represents one (1) deposited Preference
      Share)

     

    SOLELY
      FOR
      PURPOSES OF TRADING AND SETTLEMENT, THE AMERICAN DEPOSITARY SHARES MAY BE DEEMED
      TO HAVE A PRINCIPAL AMOUNT OF $1,000 PER AMERICAN DEPOSITARY SHARE.

     

    THE
      BANK OF NEW YORK

     

    AMERICAN
      DEPOSITARY RECEIPT

     

    FOR
      U.S. DOLLAR PREFERENCE SHARES NOMINAL VALUE $0.25 PER PREFERENCE SHARE[, SERIES
      __]

     

    OF

     

    LLOYDS
      TSB GROUP PLC

     

    (A
      PUBLIC LIMITED COMPANY INCORPORATED UNDER THE LAWS OF
      SCOTLAND)

     

    The
      Bank
      of New York, as depositary (herein called the Depositary), hereby certifies
      that___________ ____________________________________________, or registered
      assigns IS THE OWNER OF _____________________________

     

    AMERICAN
      DEPOSITARY SHARES[, SERIES __]

     

    representing
      deposited U.S. Dollar Preference Shares[,Series __] (herein called “Preference
      Shares”), of Lloyds TSB Group plc, a public limited company incorporated under
      the laws of Scotland (herein called the “Company”).  At the date
      hereof, each American Depositary Share represents one (1) Preference Share
      deposited or subject to deposit under the Deposit Agreement (as such term is
      hereinafter defined) at the principal London office of The Bank of New York
      (herein called the Custodian).  The Depositary’s Corporate Trust
      Office is located at a different address than its principal executive
      office.  

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    Its
      Corporate Trust Office is located at 101 Barclay Street, New York, N.Y. 10286,
      and its principal executive office is located at One Wall Street, New York,
      N.Y.
      10286.

     

    THE
      DEPOSITARY’S CORPORATE TRUST OFFICE ADDRESS IS

    101
      BARCLAY STREET, NEW YORK, N.Y. 10286

     

    
      
        
        

      

      
        A-2

        
          

        

      

      
        
        

      

    

    1.           THE
      DEPOSIT AGREEMENT.

     

    This
      American Depositary Receipt is one of an issue (herein called “Receipts”), all
      issued and to be issued upon the terms and conditions set forth in the Deposit
      Agreement, dated as of _________, 2007, as the same may be amended from time
      to
      time in accordance with its terms (the “Deposit Agreement”), by and among the
      Company, the Depositary, and all Owners and Beneficial Owners from time to
      time
      of Receipts issued thereunder, each of whom by accepting a Receipt or any
      interest therein agrees to become a party thereto and become bound by all the
      terms and conditions thereof.  The Deposit Agreement sets forth the
      rights of Owners and Beneficial Owners of the Receipts and the rights and duties
      of the Depositary in respect of the Preference Shares deposited thereunder
      and
      any and all other securities, property and cash from time to time received
      in
      respect of such Preference Shares and held thereunder (such Preference Shares,
      securities, property, and cash are herein called Deposited
      Securities).  Copies of the Deposit Agreement are on file at the
      Depositary’s Corporate Trust Office in New York City and at the office of the
      Custodian.

     

    The
      statements made on the face and reverse of this Receipt are summaries of certain
      provisions of the Deposit Agreement and are qualified by and subject to the
      detailed provisions of the Deposit Agreement, to which reference is hereby
      made.  Capitalized terms defined in the Deposit Agreement and not
      defined herein shall have the meanings set forth in the Deposit
      Agreement.

     

    2.           SURRENDER
      OF RECEIPTS AND WITHDRAWAL OF PREFERENCE SHARES.

     

    Upon
      surrender at the Corporate Trust Office of the Depositary of this Receipt,
      and
      upon payment of the fee of the Depositary provided in this Receipt, and subject
      to the terms and conditions of the Deposit Agreement, the memorandum and
      articles of association of the Company and the terms of the Deposited
      Securities, the Owner hereof is entitled to delivery, to him or upon his order,
      of the Deposited Securities at the time represented by the American Depositary
      Shares for which this Receipt is issued.  Delivery of such Deposited
      Securities may be made by the delivery of (a) Preference Shares in the name
      of
      the Owner hereof or as ordered by him or certificates properly endorsed or
      accompanied by proper instruments of transfer and (b) any other securities,
      property and cash to which such Owner is then entitled in respect of this
      Receipt.  Such delivery will be made at the option of the Owner
      hereof, either at the office of the Custodian or at the Corporate Trust Office
      of the Depositary, provided that the forwarding of certificates for Preference
      Shares or other Deposited Securities for such delivery at the Corporate Trust
      Office of the Depositary shall be at the risk and expense of the Owner
      hereof.

     

     

    
      
        
        

      

      
        A-3

        
          

        

      

      
        
        

      

    

     

     

    3.           TRANSFERS,
      SPLIT-UPS, AND COMBINATIONS OF RECEIPTS.

     

    The
      transfer of this Receipt is registrable on the books of the Depositary at its
      Corporate Trust Office by the Owner hereof in person or by a duly authorized
      attorney, upon surrender of this Receipt properly endorsed for transfer or
      accompanied by proper instruments of transfer and funds sufficient to pay any
      applicable transfer taxes and the expenses of the Depositary and upon compliance
      with such regulations, if any, as the Depositary may establish for such
      purpose.  This Receipt may be split into other such Receipts, or may
      be combined with other such Receipts into one Receipt, evidencing the same
      aggregate number of American Depositary Shares as the Receipt or Receipts
      surrendered.  As a condition precedent to the execution and delivery,
      registration of transfer, split-up, combination, or surrender of any Receipt
      or
      withdrawal of any Deposited Securities, the Depositary, the Custodian, or
      Registrar may require payment from the depositor of the Preference Shares or
      the
      presentor of the Receipt of a sum sufficient to reimburse it for any tax or
      other governmental charge and any stock transfer or registration fee with
      respect thereto (including any such tax or charge and fee with respect to
      Preference Shares being deposited or withdrawn) and payment of any applicable
      fees as provided in this Receipt, may require the production of proof
      satisfactory to it as to the identity and genuineness of any signature, may
      require delivery of such certifications as the Company may from time to time
      specify in writing to the Depositary to assure the Company of compliance with
      the Securities Act and the rules and regulations thereunder and may also require
      compliance with any regulations the Depositary may establish consistent with
      the
      provisions of the Deposit Agreement or this Receipt, including, without
      limitation, this Article 3.

     

    The
      delivery of Receipts against deposit of Preference Shares generally or against
      deposit of particular Preference Shares may be suspended, or the transfer of
      Receipts in particular instances may be refused, or the registration of transfer
      of outstanding Receipts generally may be suspended, during any period when
      the
      transfer books of the Depositary are closed, or if any such action is deemed
      necessary or advisable by the Depositary or the Company at any time or from
      time
      to time because of any requirement of law or of any government or governmental
      body or commission, or under any provision of the Deposit Agreement or this
      Receipt or any provision governing the Deposited Securities or for any other
      reason.

     

    Notwithstanding
      anything to the contrary in the Deposit Agreement, the surrender of outstanding
      Receipts and withdrawal of Deposited Securities may not be suspended subject
      only to (i) temporary delays caused by closing the transfer books of the
      Depositary or the Company or the deposit of Preference Shares in connection
      with
      voting at a shareholders’ meeting, or the payment of dividends, (ii) the payment
      of fees, taxes and similar charges, and (iii) compliance with any U.S. or
      foreign laws or governmental regulations relating to the Receipts or to the
      withdrawal of the Deposited Securities.

     

     

    
      
        
        

      

      
        A-4

        
          

        

      

      
        
        

      

    

     

     

    The
      Depositary shall not knowingly accept for deposit under the Deposit Agreement
      any Preference Shares that would be required to be registered under the
      provisions of the Securities Act for the public offer and sale thereof in the
      United States, unless a registration statement is in effect as to such
      Preference Shares for such offer and sale.

     

    Without
      limiting the foregoing, Preference Shares that the Depositary believes have
      been
      withdrawn from a restricted depositary receipt facility established or
      maintained by a depositary bank (including any such other facility maintained
      by
      the Depositary) may be accepted for deposit under the Deposit Agreement only
      if
      those Preference Shares are not “restricted securities” within the meaning of
      Rule 144(a)(3) under the Securities Act, and the Depositary may, as a condition
      of accepting those Preference Shares for deposit, require the person depositing
      those Preference Shares to provide the Depositary with a certificate to the
      foregoing effect.

     

    4.           LIABILITY
      OF OWNER OR BENEFICIAL OWNER FOR TAXES.

     

    If
      any tax
      or other governmental charge shall become payable with respect to any Receipt
      or
      any Deposited Securities represented hereby, such tax or other governmental
      charge shall be payable by the Owner or Beneficial Owner hereof to the
      Depositary.  The Depositary may refuse to effect any transfer of this
      Receipt or any withdrawal of Deposited Securities represented by American
      Depositary Shares evidenced by such Receipt until such payment is made, and
      may
      withhold any dividends or other distributions, or may sell for the account
      of
      the Owner or Beneficial Owner hereof any part or all of the Deposited Securities
      represented by the American Depositary Shares evidenced by this Receipt, and
      may
      apply such dividends or other distributions or the proceeds of any such sale
      in
      payment of such tax or other governmental charge and the Owner or Beneficial
      Owner hereof shall remain liable for any deficiency.

     

    5.           WARRANTIES
      ON DEPOSIT OF PREFERENCE SHARES.

     

    Every
      person depositing Preference Shares under the Deposit Agreement shall be deemed
      thereby to represent and warrant that such Preference Shares and each
      certificate therefor, if applicable, are validly issued, fully paid,
      nonassessable and were not issued in violation of any preemptive or similar
      rights of the holders of outstanding Preference Shares and that the person
      making such deposit is duly authorized to do so.  All representations
      and warranties required by Section 3.03 of the Deposit Agreement shall survive
      the deposit of Preference Shares, delivery of Receipts, transfer of American
      Depositary Shares and surrender of Receipts and withdrawal of Deposited
      Securities.

     

    6.           FILING
      PROOFS, CERTIFICATES, AND OTHER INFORMATION.

     

    Any
      person
      presenting Preference Shares for deposit or any Owner or Beneficial Owner of
      a
      Receipt may be required from time to time to file with the Depositary or the
      Custodian such proof of citizenship or residence, exchange control 

     

     

    
      
        
        

      

      
        A-5

        
          

        

      

      
        
        

      

    

     

     

    approval,
      or such information relating to the registration on the books of the Company
      or
      the Foreign Registrar, if applicable, to execute such certificates and to make
      such representations and warranties, as the Depositary may deem necessary or
      proper or as the Company may reasonably require by written request to the
      Depositary or the Custodian.  The Depositary may withhold the delivery
      or registration of transfer of any Receipt or the distribution of any dividend
      or sale or distribution of rights or of the proceeds thereof or the delivery
      of
      any Deposited Securities until such proof or other information is filed or
      such
      certificates are executed or such representations and warranties
      made.  No Share shall be accepted for deposit unless accompanied by
      evidence satisfactory to the Depositary that any necessary approval has been
      granted by any governmental body in the United Kingdom that is then performing
      the function of the regulation of currency exchange.

     

    7.           CHARGES
      OF DEPOSITARY.

     

    The
      Company agrees to pay the fees, reasonable expenses and out-of-pocket charges
      of
      the Depositary and those of any Registrar only in accordance with agreements
      in
      writing entered into between the Depositary and the Company from time to
      time.  The Depositary shall present its statement for such charges and
      expenses to the Company once every three months.  The charges and
      expenses of the Custodian are for the sole account of the
      Depositary.

     

    The
      following charges shall be incurred by any party depositing or withdrawing
      Preference Shares or by any party surrendering Receipts or to whom Receipts
      are
      issued (including, without limitation, issuance pursuant to a stock dividend
      or
      stock split declared by the Company or an exchange of stock regarding the
      Receipts or Deposited Securities or a distribution of Receipts pursuant to
      Section 4.03 of the Deposit Agreement), or by Owners, as applicable:
      (1) taxes and other governmental charges, (2) such registration fees
      as may from time to time be in effect for the registration of transfers of
      Preference Shares generally on the share register of the Company or Foreign
      Registrar and applicable to transfers of Preference Shares to the name of the
      Depositary or its nominee or the Custodian or its nominee on the making of
      deposits or withdrawals under the terms of the Deposit Agreement, (3) such
      cable, telex and facsimile transmission expenses as are expressly provided
      in
      the Deposit Agreement, (4) such expenses as are incurred by the Depositary
      in the conversion of foreign currency pursuant to Section 4.05 of the
      Deposit Agreement, (5) a fee of $5.00 or less per 100 American Depositary
      Shares (or portion thereof) for the execution and delivery of Receipts pursuant
      to Section 2.03, 4.03 or 4.04 of the Deposit Agreement and the surrender of
      Receipts pursuant to Section 2.05 or 6.02 of the Deposit Agreement, (6) a
      fee of $.02 or less per American Depositary Share (or portion thereof) for
      any
      cash distribution made pursuant to Sections 4.01 through 4.04 of the Deposit
      Agreement, (7) a fee for the distribution of securities pursuant to
      Section 4.02 of the Deposit Agreement, such fee being in an amount equal to
      the fee for the execution and delivery of American Depositary Shares referred
      to
      above which would have been charged as a result of the deposit of such

     

     

     

    
      
        
        

      

      
        A-6

        
          

        

      

      
        
        

      

    

     

     

    securities
      (for purposes of this clause 7 treating all such securities as if they were
      Preference Shares), but which securities are instead distributed by the
      Depositary to Owners, (8) a fee of $.02 or less per American Depositary Share
      (or portion thereof) for depositary services, which will accrue on the last
      day
      of each calendar year and will be payable as provided in clause 9 below and
      (9)
      any other charges payable by the Depositary, any of the Depositary’s agents,
      including the Custodian, or the agents of the Depositary’s agents in connection
      with the servicing of Preference Shares or other Deposited Securities (which
      charge shall be assessed against Owners as of the date or dates set by the
      Depositary in accordance with Section 4.06 of the Deposit Agreement and shall
      be
      collected at the sole discretion of the Depositary by billing such Owners for
      such charge or by deducting such charge from one or more cash dividends or
      other
      cash distributions).

     

    The
      Depositary may own and deal in any class of securities of the Company and its
      affiliates and in Receipts.

     

    8.           TITLE
      TO RECEIPTS.

     

    It
      is a
      condition of this Receipt and every successive Owner and Beneficial Owner of
      this Receipt by accepting or holding the same consents and agrees, that title
      to
      this Receipt when properly endorsed or accompanied by proper instruments of
      transfer, is transferable by delivery with the same effect as in the case of
      a
      negotiable instrument under the laws of New York; provided,
however, that the Depositary and the Company, notwithstanding any
      notice
      to the contrary, may treat the person in whose name this Receipt is registered
      on the books of the Depositary as the absolute owner hereof for the purpose
      of
      determining the person entitled to distribution of dividends or other
      distributions or to any notice provided for in the Deposit Agreement or for
      all
      other purposes.

     

    9.           VALIDITY
      OF RECEIPT.

     

    This
      Receipt shall not be entitled to any benefits under the Deposit Agreement or
      be
      valid or obligatory for any purpose, unless this Receipt shall have been
      executed by the Depositary by the manual or facsimile signature of a duly
      authorized signatory of the Depositary and, if a Registrar for the Receipts
      shall have been appointed, countersigned by the manual signature of a duly
      authorized officer of the Registrar.

     

    10.           AVAILABLE
      INFORMATION; INSPECTION OF TRANSFER BOOKS.

     

    The
      Company is subject to the periodic reporting requirements of the Securities
      Exchange Act of 1934 and, accordingly, files certain reports with the
      Commission.  Such reports will be available for inspection and copying
      by Owners and Beneficial Owners at the public reference facilities maintained
      by
      the Commission located at 100 F Street, N.E., Washington, D.C.
      20549.

     

     

    
      
        
        

      

      
        A-7

        
          

        

      

      
        
        

      

    

     

     

    The
      Depositary will make available for inspection by Owners of Receipts at its
      Corporate Trust Office any reports and communications, including any proxy
      soliciting material, received from the Company which are both (a) received
      by the Depositary as the holder of the Deposited Securities and (b) made
      generally available to the holders of such Deposited Securities by the
      Company.  The Depositary will also send to Owners of Receipts copies
      of such reports when furnished by the Company pursuant to the Deposit
      Agreement.  Any such reports and communications, including any such
      proxy soliciting material, furnished to the Depositary by the Company shall
      be
      furnished in English to the extent such materials are required to be translated
      into English pursuant to any regulations of the Commission.

     

    The
      Depositary will keep books, at its Corporate Trust Office, for the registration
      of Receipts and transfers of Receipts which at all reasonable times shall be
      open for inspection by the Owners of Receipts provided that such inspection
      shall not be for the purpose of communicating with Owners of Receipts in the
      interest of a business or object other than the business of the Company or
      a
      matter related to the Deposit Agreement or the Receipts.

     

    11.           DIVIDENDS
      AND DISTRIBUTIONS.

     

    Whenever
      the Depositary receives any cash dividend or other cash distribution on any
      Deposited Securities, the Depositary will, if at the time of receipt thereof
      any
      amounts received in a foreign currency can in the judgment of the Depositary
      be
      converted on a reasonable basis into United States dollars transferable to
      the
      United States, and subject to the Deposit Agreement, as promptly as practicable,
      convert such dividend or distribution into dollars and will distribute the
      amount thus received (net of the fees and expenses of the Depositary as provided
      in Section 5.09 of the Deposit Agreement) to the Owners of Receipts
      entitled thereto; provided, however, that in the event that the
      Company or the Depositary is required to withhold and does withhold from any
      cash dividend or other cash distribution in respect of any Deposited Securities
      an amount on account of taxes, the amount distributed to the Owners of the
      Receipts evidencing American Depositary Shares representing such Deposited
      Securities shall be reduced accordingly.

     

    Subject
      to
      the provisions of Sections 4.11 and 5.09 of the Deposit Agreement, whenever
      the Depositary receives any distribution other than a distribution described
      in
      Section 4.01, 4.03 or 4.04 of the Deposit Agreement, the Depositary will,
      after consultation with the Company to the extent practicable, as promptly
      as
      practicable, cause the securities or property received by it to be distributed
      to the Owners entitled thereto, in any manner that the Depositary may deem
      equitable and practicable for accomplishing such distribution; provided,
however, that if in the opinion of the Depositary such distribution
      cannot be made proportionately among the Owners of Receipts entitled thereto,
      or
      if for any other reason the Depositary deems such distribution not to be
      feasible, the Depositary may, after consultation with the Company 

     

     

    
      
        
        

      

      
        A-8

        
          

        

      

      
        
        

      

    

     

     

    to
      the
      extent practicable, as promptly as practicable, adopt such method as it may
      deem
      equitable and practicable for the purpose of effecting such distribution,
      including, but not limited to, the public or private sale of the securities
      or
      property thus received, or any part thereof, and the net proceeds of any such
      sale (net of the fees and expenses of the Depositary as provided in
      Section 5.09 of the Deposit Agreement) will be distributed by the
      Depositary to the Owners of Receipts entitled thereto all in the manner and
      subject to the conditions described in Section 4.01 of the Deposit
      Agreement.  The Depositary may withhold any distribution of Securities
      under Section 4.02 of the Deposit Agreement if it has not received satisfactory
      assurances from the Company that the distribution does not require registration
      under the Securities Act. The Depositary may sell, by public or private sale,
      an
      amount of securities or other property it would otherwise distribute under
      Section 4.02 of the Deposit Agreement that is sufficient to pay its fees and
      expenses in respect of that distribution.  To the extent that such
      securities or property or the net proceeds thereof are not effectively
      distributed to Owners or applied to fees or expenses of the Depositary as
      provided in Section 4.02 of the Deposit Agreement, the same shall constitute
      Deposited Securities and each American Depositary Share shall thereafter also
      represent its proportionate interest in such securities, property or net
      proceeds.

     

    If
      any
      distribution consists of a dividend in, or free distribution of, Preference
      Shares, the Depositary may, and shall, if the Company shall so request in
      writing, distribute to the Owners of outstanding Receipts entitled thereto,
      additional Receipts evidencing an aggregate number of American Depositary Shares
      representing the amount of Preference Shares received as such dividend or free
      distribution subject to the terms and conditions of the Deposit Agreement with
      respect to the deposit of Preference Shares and the issuance of American
      Depositary Shares evidenced by Receipts, including the withholding of any tax
      or
      other governmental charge as provided in Section 4.11 of the Deposit Agreement
      and the payment of the fees and expenses of the Depositary as provided in
      Section 5.09 of the Deposit Agreement (and the Depositary may sell, by
      public or private sale, an amount of the Preference Shares received that is
      sufficient to pay its fees and expenses in respect of that
      distribution).  In lieu of delivering Receipts for fractional American
      Depositary Shares in any such case, the Depositary will use its reasonable
      efforts to sell the amount of Preference Shares represented by the aggregate
      of
      such fractions and distribute the net proceeds, all in the manner and subject
      to
      the conditions described in Section 4.01 of the Deposit Agreement.  If
      additional Receipts are not so distributed, each American Depositary Share
      shall
      thenceforth also represent the additional Preference Shares distributed upon
      the
      Deposited Securities represented thereby.

     

    In
      the
      event that the Depositary determines that any distribution in property
      (including Preference Shares and rights to subscribe therefor) is subject to
      any
      tax or other governmental charge which the Depositary is obligated to withhold,
      the Depositary may by public or private sale dispose of all or a portion of
      such
      property (including Preference Shares and rights to subscribe therefor) in
      such
      amounts and in such manner as the Depositary reasonably deems necessary and
      practicable to pay any 

     

     

    
      
        
        

      

      
        A-9

        
          

        

      

      
        
        

      

    

     

     

    such
      taxes
      or charges, and the Depositary shall distribute the net proceeds of any such
      sale after deduction of such taxes or charges to the Owners of Receipts entitled
      thereto.

     

    12.           RIGHTS.

     

    In
      the
      event that the Company shall offer or cause to be offered to the holders of
      any
      Deposited Securities any rights to subscribe for additional Preference Shares
      or
      any rights of any other nature, the Depositary, after consultation with the
      Company, shall have discretion as to the procedure to be followed in making
      such
      rights available to any Owners or in disposing of such rights on behalf of
      any
      Owners and making the net proceeds available to such Owners or, if by the terms
      of such rights offering or for any other reason, the Depositary may not either
      make such rights available to any Owners or dispose of such rights and make
      the
      net proceeds available to such Owners, then the Depositary shall allow the
      rights to lapse.  If at the time of the offering of any rights the
      Depositary reasonably determines, after consultation with the Company, that
      it
      is lawful and feasible to make such rights available to all or certain Owners
      but not to other Owners, the Depositary may distribute to any Owner to whom
      it
      determines the distribution to be lawful and feasible, in proportion to the
      number of American Depositary Shares held by such Owner, warrants or other
      instruments therefor in such form as it deems reasonably
      appropriate.

     

    In
      circumstances in which rights would otherwise not be distributed, if an Owner
      of
      Receipts requests the distribution of warrants or other instruments in order
      to
      exercise the rights allocable to the American Depositary Shares of such Owner
      hereunder, the Depositary will make such rights available to such Owner upon
      written notice from the Company to the Depositary that (a) the Company has
      elected in its sole discretion to permit such rights to be exercised and
      (b) such Owner has executed such documents as the Company has determined in
      its sole discretion are reasonably required under applicable law.

     

    If
      the
      Depositary has distributed warrants or other instruments for rights to all
      or
      certain Owners, then upon instruction from such an Owner pursuant to such
      warrants or other instruments to the Depositary from such Owner to exercise
      such
      rights, upon payment by such Owner to the Depositary for the account of such
      Owner of an amount equal to the purchase price of the Preference Shares to
      be
      received upon the exercise of the rights, and upon payment of the fees and
      expenses of the Depositary and any other charges as set forth in such warrants
      or other instruments, the Depositary shall, on behalf of such Owner, exercise
      the rights and purchase the Preference Shares, and the Company shall cause
      the
      Preference Shares so purchased to be delivered to the Depositary on behalf
      of
      such Owner.  As agent for such Owner, the Depositary will cause the
      Preference Shares so purchased to be deposited pursuant to Section 2.02 of
      the Deposit Agreement, and shall, pursuant to Section 2.03 of the Deposit
      Agreement, execute and deliver Receipts to such Owner.  In the case of
      a distribution pursuant to the second paragraph of Section 4.04 of the Deposit
      Agreement, such Receipts shall be 

     

     

    
      
        
        

      

      
        A-10

        
          

        

      

      
        
        

      

    

     

     

    legended
      in accordance with applicable U.S. law and shall be subject to the appropriate
      restrictions on sale, deposit, cancellation and transfer under such
      laws.

     

    If
      the
      Depositary determines reasonably in its discretion that it is not lawful and
      feasible to make such rights available to all or certain Owners, it shall use
      its reasonable efforts to sell the rights, warrants or other instruments in
      proportion to the number of American Depositary Shares held by the Owners to
      whom it has determined it may not lawfully or feasibly make such rights
      available, and allocate the net proceeds of such sales (net of the fees and
      expenses of the Depositary as provided in Section 5.09 of the Deposit
      Agreement and all taxes and governmental charges payable in connection with
      such
      rights and subject to the terms and conditions of the Deposit Agreement) for
      the
      account of such Owners otherwise entitled to such rights, warrants or other
      instruments, upon an averaged or other practical basis without regard to any
      distinctions among such Owners because of exchange restrictions or the date
      of
      delivery of any Receipt or otherwise and distribute such net proceeds to the
      Owners entitled to them as in the case of a distribution of cash.

     

    The
      Depositary will not offer rights to Owners unless both the rights and the
      securities to which such rights relate are either exempt from registration
      under
      the Securities Act with respect to a distribution to all Owners or are
      registered under the provisions of such Act; provided, that nothing in
      the Deposit Agreement shall create any obligation on the part of the Company
      to
      file a registration statement with respect to such rights or underlying
      securities or to endeavor to have such a registration statement declared
      effective.  If an Owner of Receipts requests the distribution of
      warrants or other instruments, notwithstanding that there has been no such
      registration under the Securities Act, the Depositary shall not effect such
      distribution unless it has received an opinion from recognized counsel in the
      United States for the Company upon which the Depositary may rely that such
      distribution to such Owner is exempt from such registration.

     

    The
      Depositary shall not be responsible for any failure to determine that it may
      be
      lawful or feasible to make such rights available to Owners in general or any
      Owner in particular.

     

    13.           CONVERSION
      OF FOREIGN CURRENCY.

     

    Whenever
      the Depositary or the Custodian shall receive foreign currency, by way of
      dividends or other distributions or the net proceeds from the sale of
      securities, property or rights, and if at the time of the receipt thereof the
      foreign currency so received can in the judgment of the Depositary be converted
      on a reasonable basis into Dollars and the resulting Dollars transferred to
      the
      United States, the Depositary shall convert or cause to be converted, by sale
      or
      in any other manner that it may determine, such foreign currency into Dollars,
      and such Dollars shall be distributed to the Owners entitled thereto or, if
      the
      Depositary shall have distributed any warrants or other instruments which
      entitle the holders thereof to such Dollars, then to the holders of such

     

     

    
      
        
        

      

      
        A-11

        
          

        

      

      
        
        

      

    

     

     

    warrants
      or instruments upon surrender thereof for cancellation.  Such
      distribution may be made upon an averaged or other practicable basis without
      regard to any distinctions among Owners on account of exchange restrictions,
      the
      date of delivery of any Receipt or otherwise and shall be net of any expenses
      of
      conversion into Dollars incurred by the Depositary as provided in
      Section 5.09 of the Deposit Agreement.

     

    If
      such
      conversion or distribution can be effected only with the approval or license
      of
      any government or agency thereof, the Depositary shall file such application
      for
      approval or license, if any, as it may deem desirable.

     

    If
      at any
      time the Depositary or the Custodian shall determine that in its judgment any
      foreign currency received by the Depositary or the Custodian is not convertible
      on a reasonable basis into Dollars transferable to the United States, or if
      any
      approval or license of any government or agency thereof which is required for
      such conversion is denied or in the opinion of the Depositary is not obtainable,
      or if any such approval or license is not obtained within a reasonable period
      as
      determined by the Depositary, the Depositary may distribute the foreign currency
      (or an appropriate document evidencing the right to receive such foreign
      currency) received by the Depositary to, or in its discretion may hold such
      foreign currency uninvested and without liability for interest thereon for
      the
      respective accounts of, the Owners entitled to receive the same.

     

    If
      any
      such conversion of foreign currency, in whole or in part, cannot be effected
      for
      distribution to some of the Owners entitled thereto, the Depositary may in
      its
      discretion make such conversion and distribution in Dollars to the extent
      permissible to the Owners entitled thereto and may distribute the balance of
      the
      foreign currency received by the Depositary to, or hold such balance uninvested
      and without liability for interest thereon for the respective accounts of,
      the
      Owners entitled thereto.

     

    14.           RECORD
      DATES.

     

    Whenever
      any cash dividend or other cash distribution shall become payable or any
      distribution other than cash shall be made, or whenever rights shall be issued
      with respect to the Deposited Securities, or whenever the Depositary shall
      receive notice of any meeting of holders of Preference Shares or other Deposited
      Securities, or whenever for any reason the Depositary causes a change in the
      number of Preference Shares that are represented by each American Depositary
      Share, or whenever the Depositary shall find it necessary or convenient, the
      Depositary shall fix a record date (which shall be as near as practicable to
      any
      corresponding record date set by the Company) (a) for the determination of
      the Owners of Receipts who shall be (i) entitled to receive such dividend,
      distribution or rights or the net proceeds of the sale thereof,
      (ii) entitled to give instructions for the exercise of voting rights at any
      such meeting or (iii) responsible for any fees or charges assessed by the
      Depositary pursuant to the Deposit Agreement, or (b) on or after which each
      American Depositary Share will 

     

     

    
      
        
        

      

      
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    represent
      the changed number of Preference Shares, subject to the provisions of the
      Deposit Agreement.

     

    15.           VOTING
      OF DEPOSITED SECURITIES.

     

    Upon
      receipt from the Company of notice of any meeting or solicitation of proxies
      or
      consents of holders of Preference Shares or other Deposited
      Securities,  the Depositary shall,  if requested in writing
      by the Company, as soon as practicable thereafter, mail to the Owners a notice,
      the form of which notice shall be in the sole discretion of the Depositary,
      which shall contain (a) such information as is contained in such notice of
      meeting received by the Depositary from the Company, (b) a statement that
      the Owners as of the close of business on a specified record date will be
      entitled, subject to any applicable provision of Scottish law and of the
      articles of association and any similar document of the Company, to instruct
      the
      Depositary as to the exercise of the voting rights, if any, pertaining to the
      amount of Preference Shares or other Deposited Securities represented by their
      respective American Depositary Shares and (c) a statement as to the manner
      in
      which such instructions may be given.  Upon the written request of an
      Owner of a Receipt on such record date, received on or before the date
      established by the Depositary for such purpose, the Depositary shall endeavor
      insofar as practicable to vote or cause to be voted the amount of Preference
      Shares or other Deposited Securities represented by the  American
      Depositary Shares evidenced by such Receipt in accordance with the instructions
      set forth in such request, including an express indication that, if the
      Depositary does not receive instructions, it may deem instructions to have
      been
      given under the last sentence of this paragraph to give a discretionary proxy
      to
      a person designated by the Company.  Upon the written request of an
      Owner of a Receipt on that record date, received on or before the date
      established by the Depositary for the purpose, the Depositary shall endeavor,
      in
      so far as practicable, to vote or cause to be voted the amount of Preference
      Shares or other Deposited Securities represented by the American Depositary
      Shares evidenced by that Receipt in accordance with the instructions set forth
      in that request.  The Depositary shall not vote or attempt to exercise
      the right to vote that attaches to Deposited Securities other than in accordance
      with instructions received from Owners or deemed received under the following
      sentence.  If (i) the Company made a request to the Depositary as
      contemplated by the first sentence of Section 4.07 of the Deposit Agreement
      and
      complied with the last paragraph of that Section 4.07 and (ii)  no
      instructions are received by the Depositary from an Owner with respect to an
      amount of Deposited Securities represented by the American Depositary Shares
      evidenced by that Owner’s Receipts on or before the date established by the
      Depositary for that purpose, the Depositary shall deem that Owner to have
      instructed the Depositary to give, and the Depositary shall give, a
      discretionary proxy to a person designated by the Company with respect to that
      amount of Deposited Securities, except that such instruction shall not be deemed
      to have been given and the Depositary shall not give a discretionary proxy
      with
      respect to any matter as to which the Company informs the Depositary (and the
      Company agrees to provide that information as promptly as practicable in
      writing, if applicable) that (x) the Company does not wish to receive a

     

     

    
      
        
        

      

      
        A-13

        
          

        

      

      
        
        

      

    

     

     

    discretionary
      proxy, (y) substantial opposition exists or (z) the matter materially and
      adversely affects the rights of holders of Preference Shares.

     

    In
      order
      to give Owners a reasonable opportunity to instruct the Depositary as to the
      exercise of voting rights relating to Deposited Securities, if the Company
      requests the Depositary to act under the first sentence of Section 4.07 of
      the
      Deposit Agreement, the Company shall give the Depositary notice of the meeting
      or solicitation not less than 30 days prior to the meeting date or date for
      giving proxies or consents.

     

    16.           CHANGES
      AFFECTING DEPOSITED SECURITIES.

     

    In
      circumstances where the provisions of Section 4.03 of the Deposit Agreement
      do not apply, upon any change in nominal value, change in par value, split-up,
      consolidation, or any other reclassification of Deposited Securities, or upon
      any recapitalization, reorganization, merger or consolidation, or sale of assets
      affecting the Company or to which it is a party, any securities which shall
      be
      received by the Depositary or a Custodian in exchange for or in conversion
      of or
      in respect of Deposited Securities shall be treated as new Deposited Securities
      under the Deposit Agreement, and American Depositary Shares shall thenceforth
      represent, in addition to the existing Deposited Securities, the right to
      receive the new Deposited Securities so received in exchange or conversion,
      unless additional Receipts are delivered pursuant to the following
      sentence.  In any such case the Depositary may execute and deliver
      additional Receipts as in the case of a dividend in Preference Shares, or call
      for the surrender of outstanding Receipts to be exchanged for new Receipts
      specifically describing such new Deposited Securities.

     

    17.           LIABILITY
      OF THE COMPANY AND DEPOSITARY.

     

    Neither
      the Depositary nor the Company nor any of their respective directors, employees,
      agents or affiliates shall incur any liability to any Owner or Beneficial Owner
      if, by reason of any provision of any present or future law or regulation of
      the
      United States or any other country, or of any other governmental or regulatory
      authority, or by reason of any provision, present or future, of the articles
      of
      association or any similar document of the Company, or by reason of any
      provision of any securities issued or distributed by the Company, or any
      offering or distribution thereof, or by reason of any act of God or war or
      terrorism or other circumstances beyond its control, the Depositary or the
      Company shall be prevented, delayed or forbidden from or be subject to any
      civil
      or criminal penalty on account of doing or performing any act or thing which
      by
      the terms of the Deposit Agreement or Deposited Securities it is provided shall
      be done or performed; nor shall the Depositary or the Company or any of their
      respective directors, employees, agents or affiliates incur any liability to
      any
      Owner or Beneficial Owner of a Receipt (i) by reason of any nonperformance
      or
      delay, caused as aforesaid, in the performance of any act or thing which by
      the
      terms of the Deposit Agreement it is provided shall or may be done or performed,
      (ii) by reason of any exercise of, or failure 

     

     

    
      
        
        

      

      
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    to
      exercise, any discretion provided for in the Deposit Agreement, (iii) for the
      inability of any Owner or Beneficial Owner to benefit from any distribution,
      offering, right or other benefit which is made available to holders of Deposited
      Securities but is not, under the terms of the Deposit Agreement, made available
      to Owners or Beneficial Owners or (iv) for any special, consequential or
      punitive damages for any breach of the terms of the Deposit
      Agreement.  Where, by the terms of a distribution pursuant to
      Section 4.01, 4.02 or 4.03 of the Deposit Agreement, or an offering or
      distribution pursuant to Section 4.04 of the Deposit Agreement, such
      distribution or offering may not be made available to Owners of Receipts, and
      the Depositary may not dispose of such distribution or offering on behalf of
      such Owners and make the net proceeds available to such Owners, then the
      Depositary shall not make such distribution or offering, and shall allow any
      rights, if applicable, to lapse.  Neither the Company nor the
      Depositary assumes any obligation or shall be subject to any liability under
      the
      Deposit Agreement to Owners or Beneficial Owners of Receipts, except that they
      agree to perform their obligations specifically set forth in the Deposit
      Agreement without negligence or bad faith.  The Depositary shall not
      be subject to any liability with respect to the validity or worth of the
      Deposited Securities.  Neither the Depositary nor the Company shall be
      under any obligation to appear in, prosecute or defend any action, suit or
      other
      proceeding in respect of any Deposited Securities or in respect of the Receipts
      on behalf of any Owner, Beneficial Owner or other person, and the Custodian
      shall not be under any obligation whatsoever with respect to such proceedings,
      the responsibility of the Custodian being solely to the
      Depositary.  Neither the Depositary nor the Company shall be liable
      for any action or nonaction by it in reliance upon the advice of or information
      from legal counsel, accountants, any person presenting Preference Shares for
      deposit, any Owner or Beneficial Owner of a Receipt, or any other person
      believed by it in good faith to be competent to give such advice or
      information.  Each of the Company and the Depositary may relay and
      shall be protected in relying upon any written notice, request, direction or
      other document believed by it in good faith to be genuine and to have been
      signed or presented by the proper party or parties.  The Depositary
      shall not be responsible for any failure to carry out any instructions to vote
      any of the Deposited Securities, or for the manner in which any such vote is
      cast or the effect of any such vote, provided that any such action or nonaction
      is in good faith.  The Depositary shall not be liable for any acts or
      omissions made by a successor depositary whether in connection with a previous
      act or omission of the Depositary or in connection with a matter arising wholly
      after the removal or resignation of the Depositary, provided that in connection
      with the issue out of which such potential liability arises, the Depositary
      performed its obligations without negligence or bad faith while it acted as
      Depositary.  No disclaimer of liability under the Securities
      Act  is intended by any provision of the Deposit
      Agreement.

     

    
      	
              18.

            	
              RESIGNATION
                AND REMOVAL OF THE DEPOSITARY; APPOINTMENT OF SUCCESSOR
                CUSTODIAN.

            

    

     

    The
      Depositary may at any time resign as Depositary by written notice of its
      election so to do delivered to the Company, such resignation to take
      effect  upon the 

     

     

    
      
        
        

      

      
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    appointment
      of a successor depositary and its acceptance of such appointment as provided
      in
      the Deposit Agreement.  The Depositary may at any time be removed by
      the Company by 60 days’ prior written notice of such removal, to become
      effective upon the later of (i) the 60th day after delivery of the notice to
      the
      Depositary or (ii) the appointment of a successor depositary and its acceptance
      of such appointment as provided in the Deposit Agreement.  Whenever
      the Depositary in its discretion determines that it is in the best interest
      of
      the Owners of Receipts to do so, it may appoint a substitute or additional
      Custodian.

     

    19.           AMENDMENT.

     

    The
      form
      of the Receipts and any provisions of the Deposit Agreement may at any time
      and
      from time to time be amended by agreement between the Company and the Depositary
      without the consent of Owners or Beneficial Owners in any respect which they
      may
      deem necessary or desirable.  Any amendment which shall impose or
      increase any fees or charges (other than taxes and other governmental charges,
      registration fees and cable, telex or facsimile transmission costs, delivery
      costs or other such expenses), or which shall otherwise prejudice any
      substantial existing right of Owners of Receipts, shall, however, not become
      effective as to outstanding Receipts until the expiration of thirty days after
      notice of such amendment shall have been given to the Owners of outstanding
      Receipts.  Every Owner and Beneficial Owner of a Receipt at the time
      any amendment so becomes effective shall be deemed, by continuing to hold such
      Receipt or any interest therein, to consent and agree to such amendment and
      to
      be bound by the Deposit Agreement as amended thereby.  In no event
      shall any amendment impair the right of the Owner of any Receipt to surrender
      such Receipt and receive therefor the Deposited Securities represented thereby
      except in order to comply with mandatory provisions of applicable
      law.

     

    20.           TERMINATION
      OF DEPOSIT AGREEMENT.

     

    The
      Depositary at any time at the direction of the Company, shall terminate the
      Deposit Agreement by mailing notice of termination to the Owners of all Receipts
      then outstanding at least 30 days prior to the date fixed in such notice for
      such termination.  The Depositary may likewise terminate the Deposit
      Agreement by mailing notice of termination to the Company and the Owners of
      all
      Receipts then outstanding if at least 60 days have passed since the Depositary
      delivered to the Company a written notice of its election to resign and a
      successor depositary has not been appointed and accepted its appointment as
      provided in the Deposit Agreement.  On and after the date of
      termination, the Owner of a Receipt will, upon (a) surrender of such Receipt
      at
      the Corporate Trust Office of the Depositary, (b) payment of the fee of the
      Depositary for the surrender of Receipts referred to in Section 2.05 of the
      Deposit Agreement, and (c) payment of any applicable taxes or governmental
      charges, be entitled to delivery, to him or upon his order, of the amount of
      Deposited Securities represented by the American

     

     

    
      
        
        

      

      
        A-16

        
          

        

      

      
        
        

      

    

     

     

    Depositary
      Shares evidenced by such Receipt.  If any Receipts shall remain
      outstanding after the date of termination, the Depositary thereafter shall
      discontinue the registration of transfers of Receipts, shall suspend the
      distribution of dividends to the Owners thereof, and shall not give any further
      notices or perform any further acts under the Deposit Agreement, except that
      the
      Depositary shall continue to collect dividends and other distributions
      pertaining to Deposited Securities, shall sell rights and other property as
      provided in the Deposit Agreement, and shall continue to deliver Deposited
      Securities, together with any dividends or other distributions received with
      respect thereto and the net proceeds of the sale of any rights or other
      property, in exchange for Receipts surrendered to the Depositary (after
      deducting, in each case, the fee of the Depositary for the surrender of a
      Receipt, any expenses for the account of the Owner of such Receipt in accordance
      with the terms and conditions of the Deposit Agreement, and any applicable
      taxes
      or governmental charges).  At any time after the expiration of one
      year from the date of termination, the Depositary may sell the Deposited
      Securities then held under the Deposit Agreement and may thereafter hold
      uninvested the net proceeds of any such sale, together with any other cash
      then
      held by it thereunder, unsegregated and without liability for interest, for
      the
      pro rata benefit of the Owners of Receipts which have not theretofore been
      surrendered, such Owners thereupon becoming general creditors of the Depositary
      with respect to such net proceeds.  After making such sale, the
      Depositary shall be discharged from all obligations under the Deposit Agreement,
      except to account for such net proceeds and other cash (after deducting, in
      each
      case, the fee of the Depositary for the surrender of a Receipt, any expenses
      for
      the account of the Owner of such Receipt in accordance with the terms and
      conditions of the Deposit Agreement, and any applicable taxes or governmental
      charges).  Upon the termination of the Deposit Agreement, the Company
      shall be discharged from all obligations under the Deposit Agreement except
      for
      its obligations to the Depositary with respect to indemnification, charges,
      and
      expenses.

     

    21.           SUBMISSION
      TO JURISDICTION; WAIVER OF JURY TRIAL.

     

    In
      the
      Deposit Agreement, the Company has (i) appointed Kevin P. McKendry, Chief US
      Counsel, Lloyds TSB Bank plc, 1251 Avenue of the Americas, New York, New York
      10020, as the Company’s authorized agent upon which process may be served in any
      suit or proceeding arising out of or relating to the Preference Shares or
      Deposited Securities, the American Depositary Shares, the Receipts or this
      Agreement, (ii) consented and submitted to the jurisdiction of any state or
      federal court in the State of New York in which any such suit or proceeding
      may
      be instituted, and (iii) agreed that service of process upon said authorized
      agent shall be deemed in every respect effective service of process upon the
      Company in any such suit or proceeding.

     

    EACH
      PARTY
      TO THE DEPOSIT AGREEMENT WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE
      LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN ANY LEGAL PROCEEDING DIRECTLY
      OR INDIRECTLY ARISING OUT OF OR RELATING TO THE DEPOSIT AGREEMENT 

     

     

    
      
        
        

      

      
        A-17

        
          

        

      

      
        
        

      

    

     

     

    OR
      THE
      TRANSACTIONS CONTEMPLATED THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER
      THEORY).  EACH PARTY TO THE DEPOSIT AGREEMENT (A) CERTIFIES THAT NO
      REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY
      OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
      SEEK
      TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER
      PARTIES THERETO HAVE BEEN INDUCED TO ENTER INTO THE DEPOSIT AGREEMENT BY, AMONG
      OTHER THINGS, THE MUTUAL WAIVERS AND CERTIFICATIONS  IN SECTION 7.07
      OF THAT AGREEMENT.

     

    22.           WAIVER
      OF IMMUNITIES.

     

    To
      the
      extent that the Company or any of its properties, assets or revenues may have
      or
      may hereafter become entitled to, or have attributed to it, any right of
      immunity, on the grounds of sovereignty or otherwise, from any legal action,
      suit or proceeding, from the giving of any relief in any respect thereof, from
      setoff or counterclaim, from the jurisdiction of any court, from service of
      process, from attachment upon or prior to judgment, from attachment in aid
      of
      execution or judgment, or from execution of judgment, or other legal process
      or
      proceeding for the giving of any relief or for the enforcement of any judgment,
      in any jurisdiction in which proceedings may at any time be commenced, with
      respect to its obligations, liabilities or any other matter under or arising
      out
      of or in connection with the Preference Shares or Deposited Securities, the
      American Depositary Shares, the Receipts or this Deposit Agreement, the Company,
      to the fullest extent permitted by law, hereby irrevocably and unconditionally
      waives, and agrees not to plead or claim, any such immunity and consents to
      such
      relief and enforcement.

     

    23.                      REDEMPTION
      OF DEPOSITED SECURITIES.

     

    If
      the
      Depositary receives a notice that Deposited Securities are to be redeemed,
      the
      Depositary shall (i) call for surrender a corresponding number of American
      Depositary Shares, (ii) notify the Owners of those American Depositary Shares
      that the Deposited Securities underlying their American Depositary Shares will
      be surrendered for redemption and (iii) surrender Deposited Securities that
      have
      been redeemed to the issuer of those securities or its agent on the redemption
      date.  Owners of American Depositary Shares affected by the redemption
      may surrender the Receipts evidencing those American Depositary Shares and
      receive delivery of money or other property the Depositary receives upon
      redemption of Deposited Securities as provided in Section 2.05 of the Deposit
      Agreement.

     

    If
      the
      Depositary receives notice that less than all the Deposited Securities are
      to be
      redeemed, the Depositary shall determine in its discretion which American
      Depositary Shares to call for surrender in connection with that
      redemption.   If the Depositary calls for surrender less than all
      the American Depositary Shares evidenced by 

     

     

    
      
        
        

      

      
        A-18

        
          

        

      

      
        
        

      

    

     

     

    a
      Receipt
      in connection with a redemption of Deposited Securities, the Depositary shall,
      upon surrender of that Receipt, deliver to the Owner a Receipt evidencing the
      amount of American Depositary Shares evidenced by the surrendered Receipt that
      were not called for surrender.

     

    24.           DISCLOSURE
      OF INTERESTS.

     

    The
      Company may from time to time request Owners to provide information as to the
      capacity in which such Owners own or owned Receipts and regarding the identity
      of any other persons then or previously having a beneficial interest in such
      Receipts and the nature of such interest and various other
      matters.  Each Owner agrees to provide any information requested by
      the Company or the Depositary pursuant to Section 3.04 of the Deposit
      Agreement.

     

    25.           ISSUANCE
      IN SERIES.

     

    If
      the
      Company issues Preference Shares in more than one class or series or that
      otherwise entitle their holders to rights that vary from the rights to which
      other Preference Shares entitle their holders, the following provisions shall
      apply, notwithstanding anything to the contrary in the Deposit
      Agreement:

     

    (a)  The
      word
“Series,” when used with respect to Preference Shares, shall mean all
      outstanding Preference Shares that entitle their holders to identical rights
      with respect to those Preference Shares, regardless of the title or any other
      designation that may be assigned to Preference Shares.

     

    (b)  The
      Depositary shall direct the Custodian to hold Preference Shares of a Series
      deposited under the Deposit Agreement, and other Deposited Securities it
      receives in respect of those Preference Shares in a segregated account different
      from the account in which it holds Preference Shares of any other
      Series.

     

    (c)  Preference
      Shares of each Series that are deposited under the Deposit Agreement shall
      be
      represented by a “Series” of American Depositary Shares separate from the
      American Depositary Shares representing Preference Shares of any other
      Series.  The Depositary shall assign a designation to each Series of
      American Depositary Shares and shall reflect in its records the series to which
      each American Depositary Share belongs.  Each series of American
      Depositary Shares shall be evidenced by a “Series” of Receipts separate from the
      Receipts evidencing American Depositary Shares of any other
      Series.  Each Receipt shall be marked to indicate the designation of
      the Series of the American Depositary Shares evidenced by that Receipt and
      to
      identify the Series of Preference Shares those American Depositary Shares
      represent.

     

    
 

    
      
        
        

      

      
        A-19

        
          

        

      

      
        
        

      

    

     

    (d)  If
      the
      rights to which deposited Preference Shares of a Series entitle their holders
      are modified such that those rights become identical to the rights to which
      deposited Preference Shares of another Series entitle their holders, the
      Depositary shall cause the Custodian to combine the accounts in which the former
      separate Series of Preference Shares are held, the Series of American Depositary
      Shares representing those Preference Shares will automatically be combined
      into
      one Series of American Depositary Shares and the Depositary may take any action
      necessary or convenient to effect that combination.  At any time after
      that combination, the Owners of Receipts affected by that combination will
      be
      entitled to surrender their Receipts to the Depositary and receive Receipts
      reflecting the designation of the American Depositary Shares owned by them
      as a
      result of that combination.

    

     

    (e)
      Owners
      and Beneficial Owners of American Depositary Shares of a Series shall be
      entitled to rights under the Deposit Agreement only with respect to deposited
      Preference Shares of the corresponding Series and other Deposited Securities
      received in respect of deposited Preference Shares of that Series.

     

    26.           UNCERTIFICATED
      AMERICAN DEPOSITARY SHARES; DIRECT REGISTRATION
      SYSTEM.

     

    Notwithstanding
      anything to the
      contrary in the Deposit Agreement:

     

    (a)           American
      Depositary Shares may be certificated securities evidenced by Receipts or
      uncertificated securities.  The form of Receipt annexed as Exhibit A
      to the Deposit Agreement describes the terms and conditions of, and will be
      the
      prospectus required under the Securities Act for, both certificated and
      uncertificated American Depositary Shares.  Except for those
      provisions of the Deposit Agreement that by their nature do not apply to
      uncertificated American Depositary Shares, all the provisions of this Deposit
      Agreement shall apply, mutatis mutandis, to uncertificated American
      Depositary Shares as well as to certificated American Depositary Shares, and
      to
      Owners and holders of uncertificated American Depositary Shares as well as
      to
      Owners and holders of Receipts.

     

    (b)           (i)           The
      term “deliver”, or its noun form, when used with respect to Receipts, shall mean
      (A) book-entry transfer of American Depositary Shares to an account at DTC
      designated by the person entitled to such delivery,  (B) registration
      of American Depositary Shares not evidenced by a Receipt on the books of the
      Depositary in the name requested by the person entitled to such delivery
      and  mailing to that person of a statement confirming that
      registration or (C) if requested by the person entitled to such delivery,
      delivery at the Corporate Trust Office of the Depositary to the person entitled
      to such delivery of one or more Receipts evidencing American Depositary Shares
      registered in the name requested by that person.

     

     

    
      
        
        

      

      
        A-20

        
          

        

      

      
        
        

      

    

     

     

               (ii)           The
      term “surrender”, when used with respect to Receipts, shall mean (A) one or more
      book-entry transfers of American Depositary Shares to the DTC account of the
      Depositary, (B) delivery to the Depositary at its Corporate Trust Office of
      an
      instruction to surrender American Depositary Shares not evidenced by a
      Receipt  or (C) surrender to the Depositary at its Corporate Trust
      Office of one or more Receipts evidencing American Depositary
      Shares.

     

    (c)           American
      Depositary Shares not evidenced by Receipts shall be transferable as
      uncertificated registered securities under the laws of the State of New
      York.

     

    (d)           The
      Depositary shall have a duty to register a transfer in the case of
      uncertificated American Depositary Shares, upon receipt from the Owner of a
      proper instruction (including, for the avoidance of doubt, instructions through
      DRS and Profile, as defined and provided in subsection (f)
      below).  The Depositary, upon surrender of a Receipt for the purpose
      of exchanging for uncertificated American Depositary Shares, shall cancel that
      Receipt and send the Owner a statement confirming that the Owner is the owner
      of
      the same number of uncertificated American Depositary Shares that the
      surrendered Receipt evidenced. The Depositary, upon receipt of a proper
      instruction (including, for the avoidance of doubt, instructions through DRS
      and
      Profile as provided in subsection (f) below) from the Owner of uncertificated
      American Depositary Shares for the purpose of exchanging for certificated
      American Depositary Shares, shall execute and deliver to the Owner a Receipt
      evidencing the same number of certificated American Depositary
      Shares.

     

    (e)           Upon
      satisfaction of the conditions for replacement of a Receipt that is mutilated,
      lost, destroyed or stolen, the Depositary shall deliver to the Owner the
      American Depositary Shares evidenced by that Receipt in uncertificated form
      unless otherwise requested by the Owner.

     

    (f)           (i)  The
      parties acknowledge that the Direct Registration System (“DRS”) and Profile
      Modification System (“Profile”) shall apply to uncertificated American
      Depositary Shares upon acceptance thereof to DRS by DTC.  DRS is the
      system administered by DTC pursuant to which the Depositary may register the
      ownership of uncertificated American Depositary Shares, which ownership shall
      be
      evidenced by periodic statements issued by the Depositary to the Owners entitled
      thereto.  Profile is a required feature of DRS which allows a DTC
      participant, claiming to act on behalf of an Owner of American Depositary
      Shares, to direct the Depositary to register a transfer of those American
      Depositary Shares to DTC or its nominee and to deliver those American Depositary
      Shares to the DTC account of that DTC participant without receipt by the
      Depositary of prior authorization from the Owner to register such
      transfer.

     

    (ii)  In
      connection with and
      in accordance with the arrangements and procedures relating to DRS/Profile,
      the
      parties understand that the Depositary will not verify, determine or otherwise
      ascertain that the DTC participant which is claiming to be acting 

     

     

    
      
        
        

      

      
        A-21

        
          

        

      

      
        
        

      

    

     

     

    on
      behalf
      of an Owner in requesting a registration of transfer and delivery as described
      in subsection (a) has the actual authority to act on behalf of the Owner
      (notwithstanding any requirements under the Uniform Commercial
      Code).  For the avoidance of doubt, the provisions of Sections 5.03
      and 5.08 of the Deposit Agreement shall apply to the matters arising from the
      use of the DRS.  The parties agree that the Depositary’s reliance on
      and compliance with instructions received by the Depositary through the
      DRS/Profile System and in accordance with the Deposit Agreement shall not
      constitute negligence or bad faith on the part of the Depositary.

     

    
      
        
        

      

      
        A-22<PAGE>

                                                                    EXHIBIT 10.5

                           EXCLUSIVE LICENSE AGREEMENT

THIS AGREEMENT made and entered into as of March 22, 2006 ("Effective Date"), by
and between NANODYNAMICS, INC., a Delaware corporation, with offices at 901
Fuhrmann Boulevard, Buffalo, NY 14203 ("NANO") and INFRAMAT CORPORATION, a
Connecticut corporation with an address located at 74 Batterson Park Road,
Farmington, Connecticut 06032 ("IMC") and US NANOCORP, INC., a Connecticut
corporation with an address located at 74 Batterson Park Road, Farmington,
Connecticut 06032 ("US NANOCORP"). IMC and US NANOCORP are collectively referred
to herein as "INFRAMAT".

     WHEREAS, INFRAMAT is the exclusive licensee from The University of
Connecticut and Rutgers, The State University of New Jersey ("C&R") pursuant to
an Exclusive License Agreement dated June 1, 1997 set forth in Exhibit B to this
Agreement ("C&R License") of all right, title, and interest in and to certain
inventions and intellectual property associated therewith pertaining to
precipitation technology as more particularly disclosed in the US and Foreign
Patents and Patent Applications listed on Exhibit A to this Agreement
("Intellectual Property"); and

     WHEREAS, US NANOCORP is a sublicensee of IMC pursuant to a Sublicense
Agreement dated September 25, 1997 set forth in Exhibit C to this Agreement with
certain right, title and interest in the Intellectual Property; and

     WHEREAS, LICENSEE desires to obtain a sublicense of the Intellectual
Property and a license of any Improvements (as defined below) upon the terms and
conditions hereinafter set forth.

     NOW, THEREFORE, in consideration of the undertakings herein contained and
other goods and valuable consideration, the receipt of which is hereby
acknowledged by all parties hereto, NANO and the INFRAMAT agree as follows:

1.   DEFINITIONS

     1.1 AFFILIATE -- shall mean any person that directly, or indirectly through
one or more intermediaries, controls or is controlled by, or is under common
control with, the person specified. The term control (including the terms
controlling, controlled by and under common control with) means the possession,
direct or indirect, of the power to direct or cause the direction of the
management and policies of a person, whether through the ownership of voting
securities, by contract, or otherwise.

     1.2 LICENSED PATENTS -- shall mean all of the following:

          (a) the patents and patent applications described in Exhibit A to this
Agreement, any Improvements, and any divisional, continuation,
continuation-in-part applications related thereto and the resulting patents
therefrom;

<PAGE>

          (b) any patents resulting from reissues or reexaminations of the
United States patents described in (a) above;

          (c) any PCT patent application, foreign patent applications, and
patents incorporating the Intellectual Property or Improvements, and any
divisional, continuation, continuation-in-part applications related thereto and
the resulting patents therefrom; and

          (d) any foreign patents resulting from foreign procedures equivalent
to U.S. reissues and reexaminations of the foreign patents described in (c)
above.

     1.3 IMPROVEMENTS - shall mean any and all new and useful processes,
manufactures, devices, or methods of use pertaining to the Intellectual Property
and first conceived, reduced to practice or developed (i) after June 1, 1997 by
C&R (if covered by the C&R Agreement) or INFRAMAT or (ii) during the term of
this Agreement by C&R (if covered by the C&R Agreement) or INFRAMAT that:

               (i) increase the performance, operation, efficacy or safety of
the Licensed Product,

               (ii) reduce the cost of manufacture of the Licensed Products, or

               (iii) otherwise relate to the manufacture or use of the Licensed
Products or the practice of any method claimed in any of the patents and/or
patent applications within the Licensed Patents.

     1.4 LICENSED PRODUCT - shall mean any material, either alone or as
incorporated in a product whose manufacture or production practices any issued
or pending claim within the Licensed Patents or Improvements.

     1.5 NET SALES - shall mean the invoice price to customers of NANO for sales
of the Licensed Product, as recorded as "net sales" for purposes of NANO's
audited financial statements prepared in accordance with GAAP, less deductions
from such invoice price for:

               (i) refunds actually allowed or taken for rejected or returned
Licensed Product,

               (ii) excise, use, value added and sales taxes to the extent
included in the amounts invoiced,

               (iii) customs, duties and other imposts, to the extent included
in the amounts invoiced,

               (iv) quantity discounts, actually allowed or taken,

               (v) credits on account of retroactive price reductions, actually
allowed or taken,

                                       2

<PAGE>

               (vi) promotional dollars and sales commissions that effectively
reduce the price paid by NANO' s customers for the Licensed Product,

               (vii) cost of insurance, billed to and paid by the customer,

               (viii) cost of shipping and transportation, billed to and paid by
the customer, and

               (ix) rebates required by government rule, regulation, program or
fiat, to the extent that any such rebates may be paid or allowed by NANO.

In any sale of Licensed Product by NANO, if the materials are incorporated in a
product, Net Sales shall be the amount that Licensee would customarily charge to
a third party for the Licensed Product incorporated into such product if sold as
materials on a stand alone basis.

     1.6 QUARTERLY PERIOD - shall mean a three (3) month period, the first of
which starts on the Effective Date.

     1.7 THIRD PARTY - means any person or entity other than a party to this
Agreement.

2.   GRANT

     2.1 Subject to the terms and conditions of this Agreement, INFRAMAT hereby
grants to NANO for the Term of this Agreement, the right and worldwide exclusive
license to use or sublicense the Intellectual Property and Patent Rights with
respect to the Licensed Product, and to make, have made, use and sell the
Licensed Product and to practice under the Licensed Patents. NANO shall have no
right, however, to sublicense any interest in the Intellectual Property or
Patent Rights to any Affiliate without the prior written consent of INFRAMAT.

     2.2 INFRAMAT shall from time to time promptly provide NANO with detailed
information relative to Improvements including copies of all disclosures and
other communications received from C&R relating to the Intellectual Property.
Any and all Improvements shall be automatically included in the definition of
Intellectual Property and included in the license granted under this Agreement.

     2.3 The obligations of INFRAMAT under the C&R License shall be binding upon
NANO as if it were a party to the C&R License to the extent applicable under the
terms of this Agreement.

3.   PAYMENTS AND ROYALTIES

     3.1 In exchange for the rights conveyed by INFRAMAT to NANO under this
Agreement, and except as provided in Section 3.2 herein, NANO shall pay to
INFRAMAT:

                                       3

<PAGE>

               (i) a royalty on all sublicensing fees, payments and royalties
("Fees") received by NANO with respect to any sublicense of the Intellectual
Property to independent third parties equal to twenty percent (20%) of all Fees;

               (ii) a royalty, on Net Sales by NANO equal to five percent (5%)
of cumulative Net Sales up to $5,000,000, four percent (4%) of cumulative Net
Sales from $5,000,001 to $10,000,000, three percent (3%) of cumulative Net Sales
from $10,000,001 to $15,000,000, and two percent (2%) of cumulative Net Sales
above $15,000,000;

               (iii) In the event that the aggregate consideration paid to
INFRAMAT on or before the fifth anniversary of this Agreement does not exceed
$750,000, at NANO'S option, (i) the license shall revert to a non-exclusive
license, or (ii) NANO shall pay INFRAMAT the difference between $750,000 and the
actual aggregate consideration paid to INFRAMAT on or before such fifth
anniversary. If the license reverts to a non-exclusive license, INFRAMAT shall
not at any time thereafter solicit or encourage, either directly or indirectly,
any customer, supplier, sublicensee or other business partner of NANO to
terminate, reduce or otherwise change its relationship with NANO.

               (iv) Annual minimum royalties shall be paid if such minimum
royalties are greater than payments computed under Section 3.1(i) and (ii) above
for the applicable year and then only to the extent of any deficiency. Annual
minimum royalties shall be set at $50,000 starting in the year beginning five
(5) years after the date of this Agreement for the sixth year of this Agreement.
In the event that the aggregate consideration paid to INFRAMAT during the sixth
or any subsequent year of this Agreement does not exceed $50,000, at NANO
option, (i) the license shall revert to a non-exclusive license, or (ii) NANO
shall pay INFRAMAT the difference between $50,000 and the actual aggregate
consideration paid to INFRAMAT with respect to the applicable year of this
Agreement. If the license reverts to a non-exclusive license, INFRAMAT shall not
at any time thereafter solicit or encourage, either directly or indirectly, any
customer, supplier, sublicensee or other business partner of NANO to terminate,
reduce or otherwise change its relationship with NANO.

               (v) The aggregate consideration required in (iii) above and the
(iv) annual minimum royalties required in (iv) above shall be reduced by the
amount of all fees and costs under Section 6.2 plus Consulting Fees under
Section 3.2 paid by NANO during the applicable period.

     3.2 During each of the first five (5) years of this Agreement, NANO shall
enter into a technical consulting agreement with INFRAMAT to provide a minimum
of $20,000 per annum of technical consulting services at a rate of $500 per hour
("Consulting Fees").

     3.3 NANO's obligation to pay shall be on a country by country basis under
Section 3.1 and shall commence on the date hereof and shall continue until the
later of (i) expiration of any patent issuing in connection with the Patent
Rights or ten (10) years

                                        4

<PAGE>

from the date of the first commercial sale of Licensed Product in such country
(unless this Agreement is terminated sooner as provided herein).

     3.4 The Licensed Product shall be considered sold when NANO receives
payment from its customer or sublicensee. Suitable adjustments may be made to
sales records when the Licensed Products are returned and credit is given to the
customer.

     3.5 NANO shall produce a report ("Royalty Report") setting forth in
reasonable detail the calculation of the royalties payable to INFRAMAT for each
Quarterly Period.

     3.6 NANO shall deliver to INFRAMAT on or before the last day of each month
following the end of each Quarterly Period in which the Licensed Product is
sold, a Royalty Report for such Quarterly Period. Such Royalty Report shall be
treated as confidential information of NANO subject to Section 9 of this
Agreement.

     3.7 Royalty payments due hereunder shall be paid and delivered to INFRAMAT
on or before the last day of each month following the end of each Quarterly
Period. Minimum annual royalties shall be paid on or before the last day of the
month following the end of the applicable annual period.

     3.8 Royalty payments shall be made in United States dollars. If any
currency conversion shall be required in connection with the payment of
royalties hereunder, such conversion shall be made by using the exchange rate
prevailing at the Citibank, New York, New York on the date of payment by the
customer or sublicensee to NANO.

     3.9 No royalty is due if the Licensed Product is given away as samples to
promote sales of the Licensed Product.

     3.10 NANO may offset against all royalty payments any and all amount paid
by NANO on behalf of INFRAMAT with respect to the C&R License or any and all
amounts owing under that certain Promissory Note dated March 22, 2006 executed
by INFRAMAT to NANO.

4.   RECORDS AND INSPECTION

     4.1 NANO shall maintain accurate books and records that enable the
calculation of royalties payable hereunder to be verified. NANO shall retain the
books and records for each Quarterly Period for three (3) years after the
submission of the corresponding Royalty Report.

     4.2 INFRAMAT or its agents, such as an independent royalty investigator or
accountant, shall have the right once per calendar year, upon reasonable notice,
to inspect NANO's books and records during NANO's normal business hours at
mutually agreed times for the sole purpose of verifying the accuracy of NANO's
royalty payments and compliance with Section 3.1 of this Agreement. Any such
inspection shall be at INFRAMAT's expense. In no event shall INFRAMAT have the
right to inspect

                                       5

<PAGE>

information with respect to NANO's products other than the Licensed Product,
cost for materials, pricing formulae, or percentages of mark-up.

     4.3 In the event that such inspection demonstrates an underpayment by NANO
to INFRAMAT, NANO shall promptly pay to INFRAMAT the underpayment plus interest
from the date such amount was due at the prime rate reported by the Citibank,
New York, New York.

     4.4 INFRAMAT shall promptly provide NANO with copies of all communications
and notices from C&R (i) relating to the Intellectual Property, Patent Rights
and Improvements or (ii) affecting INFRAMAT's rights or obligations under the
C&R License. NANO shall have the right, but not the obligation, to cure any act
or omission by INFRAMAT under the C&R License that may impair NANO's rights
under this Agreement.

5.   REPRESENTATIONS AND WARRANTIES

          (a) INFRAMAT represent and warrant that:

               (i) INFRAMAT is the exclusive licensee of the entire right, title
and interest in and to the Intellectual Property;

               (ii) The C&R License is in full force and effect and there does
not exist an event of default, or circumstance that with the mere passage of
time will constitute an event of default, under the terms of the C&R License;

               (iii) there are no outstanding liens, encumbrances, Third Party
rights, agreements, understandings, or claims of any kind whatsoever, either
written, oral or implied, regarding the Intellectual Property that are
inconsistent or in conflict with any provision of this Agreement;

               (iv) INFRAMAT is a corporation duly organized and validly
existing under the laws of Connecticut. INFRAMAT has the corporate power to
execute, deliver and perform this Agreement;

               (v) The execution and delivery of this Agreement by INFRAMAT does
not, and the performance of its obligations hereunder will not, violate any
provision of the charter documents of INFRAMAT or violate any provision of, or
result in a breach of any of the terms or provisions of or the acceleration of
any of the obligations under, or constitute a default under, any mortgage,
lease, agreement, instrument, order, arbitration award, judgment or decree to
which INFRAMAT is a party or to which NANO or its assets, properties or business
are subject. This Agreement is a valid and binding agreement of INFRAMAT
enforceable against it in accordance with its terms;

               (vi) INFRAMAT is not party to any agreement with or obligation to
any third-party or any other legally binding commitment of any kind or nature
whatsoever that may conflict with, diminish or limit in any manner the full
right

                                       6

<PAGE>

and authority of INFRAMAT to perform its covenants under this Agreement.
INFRAMAT will not divest itself of any right now or hereafter possessed where
the effect of so doing may be to diminish or impair NANO'S rights under this
Agreement;

               (vii) No approval of any person, entity or government authority
is necessary with respect to the execution, delivery and performance of this
Agreement by INFRAMAT;

               (viii) During the term of the Agreement and for a period of one
(1) year thereafter, INFRAMAT will not, and will cause its Affiliates not to,
directly or indirectly, for INFRAMAT's own account or for the account of any
other individual or entity, offer to employ or retain, solicit to employ or
retain, or employ or retain as an employee or a consultant, as the case may be,
any employee of NANO or any of its Affiliates on the date hereof or hereafter (a
"NANO Employee"), or otherwise attempt to induce any NANO Employee to terminate
employment with NANO or its Affiliates. In addition, INFRAMAT represents that it
will not, and will cause its Affiliates not to, directly or indirectly, for
INFRAMAT's own account or for the account of any other individual or entity,
attempt, induce or otherwise encourage, any NANO Employee from terminating or
any person from declining employment with NANO or any of its Affiliates.
INFRAMAT acknowledges and agrees that the agreements and covenants contained in
this Section 5 (b)(v) are reasonable and valid in geographical and temporal
scope and in all other respects, and essential to protect the value of
INFRAMAT'S business; and

               (ix) INFRAMAT is able, and has not admitted in writing its
inability, to pay its debts generally as they become due, filed or consented to
the filing against it of a petition in bankruptcy or a petition to take
advantage of any insolvency act, made an assignment for the benefit of
creditors, consented to the appointment of a receiver for itself or for the
whole or any substantial part of its property, or had a petition in bankruptcy
filed against it, been adjudicated a bankrupt, or filed a petition or answer
seeking reorganization or arrangement under the federal bankruptcy laws or any
other laws of the United States or any other jurisdiction; and

               (x) there is no threatened or pending legal action against
INFRAMAT with respect to the Intellectual Property.

               (xi) it will not engage in research and development activities
utilizing the Intellectual Property, Licensed Patents or Improvements except (i)
for or on behalf of NANO or (ii) for contract research and development for or on
behalf of any US governmental body, agency or authority under any contract
existing on the date of this Agreement or (iii) with the prior consent of NANO,
such consent not to be unreasonably withheld, for contract research and
development for or on behalf of any US governmental body, agency or authority
under any future contract .

          (b) NANO represents, warrants and covenants that:

                                       7

<PAGE>

               (i) NANO is a corporation duly organized and validly existing
under the laws of Delaware. NANO has the corporate power to execute, deliver and
perform this Agreement;

               (ii) The execution and delivery of this Agreement by NANO does
not, and the performance of its obligations hereunder will not, violate any
provision of the charter documents of NANO or violate any provision of, or
result in a breach of any of the terms or provisions of or the acceleration of
any of the obligations under, or constitute a default under, any mortgage,
lease, agreement, instrument, order, arbitration award, judgment or decree to
which NANO is a party or to which NANO or its assets, properties or business are
subject. This Agreement is a valid and binding agreement of NANO enforceable
against it in accordance with its terms;

               (iii) NANO is not party to any agreement with or obligation to
any third-party or any other legally binding commitment of any kind or nature
whatsoever that may conflict with, diminish or limit in any manner the full
right and authority of NANO to perform its covenants under this Agreement. NANO
will not divest itself of any right now or hereafter possessed where the effect
of so doing may be to diminish or impair INFRAMAT'S rights under this Agreement;

               (iv) No approval of any person, entity or government authority is
necessary with respect to the execution, delivery and performance of this
Agreement by NANO;

               (v) During the term of the Agreement and for a period of one (1)
year thereafter, NANO will not, and will cause its Affiliates not to, directly
or indirectly, for NANO' s own account or for the account of any other
individual or entity, offer to employ or retain, solicit to employ or retain, or
employ or retain as an employee or a consultant, as the case may be, any
employee of INFRAMAT or any of its Affiliates on the date hereof or hereafter
(an "INFRAMAT Employee"), or otherwise attempt to induce any INFRAMAT Employee
to terminate employment with INFRAMAT or its Affiliates: In addition, NANO
represents that it will not, and will cause its Affiliates not to, directly or
indirectly, for NANO's own account or for the account of any other individual or
entity, attempt, induce or otherwise encourage, any INFRAMAT Employee from
terminating or any person from declining employment with INFRAMAT or any of its
Affiliates. NANO acknowledges and agrees that the agreements and covenants
contained in this Section 5 (b)(v) are reasonable and valid in geographical and
temporal scope and in all other respects, and essential to protect the value of
INFRAMAT'S business; and

               (vi) NANO is able, and has not admitted in writing its inability,
to pay its debts generally as they become due, has not filed or consented to the
filing against it of a petition in bankruptcy or a petition to take advantage of
any insolvency act, has not made an assignment for the benefit of creditors,
consented to the appointment of a receiver for itself or for the whole or any
substantial part of its property, or had a petition in bankruptcy filed against
it, and has not been adjudicated a bankrupt, or filed a petition or answer

                                       8

<PAGE>

seeking reorganization or arrangement under the federal bankruptcy
laws or any other laws of the United States or any other jurisdiction.

6.   PATENT PROSECUTION

     6.1 INFRAMAT shall apply for and shall diligently seek prompt issuance of
and maintain during the term of this Agreement Licensed Patents in the United
States and in such foreign countries as may be designated by NANO in a written
notice to INFRAMAT within a reasonable time in advance of the required foreign
filing dates. INFRAMAT shall provide NANO with copies of patent applications and
substantive responses to office actions prior to filing of the same in relevant
patent offices and shall advise NANO regarding national and regional patent
filings and maintenance of the same. NANO shall have the opportunity to advise
and cooperate with INFRAMAT in the prosecution, filing and maintenance of such
patents. If INFRAMAT elects not to pursue such patent prosecution, filing and
maintenance as NANO deems appropriate, then NANO may elect to do so at its own
expense, notwithstanding Section 6.2 hereof, and INFRAMAT agrees to cooperate
with NANO in such undertakings.

     6.2 All fees and costs, including attorneys' fees, relating to the filing,
prosecution and maintenance of the Licensed Patents incurred after the date of
this Agreement shall be the responsibility of NANO.

     6.3 If NANO elects to pursue a patent prosecution filing and maintenance
under Section 6.1, INFRAMAT agrees to cooperate fully in the preparation,
filing, prosecution, defense, and maintenance of such patent, including but not
limited to executing all papers and instruments so as to enable NANO to apply
for, to prosecute, to defend, and to maintain such patent and the applicable
patent application.

7.   INFRINGEMENT

     7.1 If either party shall determine that there is a probable infringement
of any of the Intellectual Property by a Third Party, that party shall promptly
notify the other party in writing of the infringement.

     7.2 INFRAMAT, on discovery or notification of such infringement, shall,
with reasonable promptness, refer the matter to its intellectual property
counsel to perform an infringement evaluation and determine the likelihood of
success on the merits of an infringement claim. At its option and its expense,
NANO may retain its own intellectual property counsel to conduct an independent
evaluation or to consult with INFRAMAT's intellectual property counsel regarding
the evaluation under a suitable joint privilege agreement.

     7.3 If INFRAMAT determines that the facts pertaining to infringement and
the likelihood of success of any action warrants taking legal action against an
infringer, INFRAMAT shall advise NANO in writing of such determination prior to
taking any legal action. If INFRAMAT determines that the facts pertaining to
infringement and the likelihood of success of any action do not warrant taking
legal action, it shall so advise NANO. If INFRAMAT decides not to pursue legal
action, NANO shall have the option to elect to bring an infringement action

                                       9

<PAGE>

at its own cost and expense, and NANO shall not hold INFRAMAT liable for lack of
infringement litigation. If NANO decides not to bring litigation for patent
infringement, INFRAMAT shall not hold NANO liable for lack of infringement
litigation.

     7.4 The parties agree to fully cooperate with and assist each other in any
infringement action under the Intellectual Property. If one party brings an
infringement action against a Third Party ("Litigating Party"), the other party,
in order to assist in bringing and maintaining the suit, shall: (i) join as a
party, if necessary to the maintenance of the infringement action; (ii) grant
all lawful permissions and sign all lawful documents necessary in the Litigating
Party's judgment to prosecute the action; and (iii) give all truthful testimony
requested by the Litigating Party.

     7.5 If any infringement action taken shall prove successful and the
Litigating Party shall collect monies by judgment or settlement, and provided
the other party complies with Section 7.4, the Litigating Party shall: (i)
deduct its intellectual property counsel fees and other reasonable expenses
attendant to such action, including without limitation expert fees; and (ii)
then shall pay to the other party twenty-five (25%) percent of the balance of
monies collected by judgment or settlement.

     7.6 Neither party may settle an infringement claim without the prior
approval of the other party if such settlement would affect the rights of the
other party in the Licensed Patents.

8.   TERM, BREACH, AND TERMINATION

     8.1 Except as herein provided, this Agreement shall remain in full force
and effect until the last claim of any patent included in the Licensed Patents
expires.

     8.2 If NANO fails to perform any one or more of its material obligations
required by this Agreement and shall not remedy the same within ninety (90) days
after receipt of written notice by INFRAMAT specifying the details of the
alleged breach, or if NANO shall discontinue business, become insolvent, have a
receiver appointed, go into liquidation, or be the subject of any bankruptcy
proceeding that is instituted and not dismissed within thirty (30) days, then
INFRAMAT shall have the option to terminate this Agreement.

     8.3 NANO may terminate this Agreement at any time upon sixty (60) days
prior written notice.

     8.4 No termination under Sections 8.2 or 8.3 shall relieve any party from
any existing obligation under this Agreement prior to termination, including
without limitation the obligation to pay royalties. No termination of this
Agreement shall result in a termination of any sublicense if the sublicense is
not in default under the sublicense agreement and agrees to perform all of the
obligations of NANO to INFRAMAT under this Agreement.

                                       10

<PAGE>

9.   CONFIDENTIAL INFORMATION

     9.1 Unless agreed to in advance and in writing, each party agrees not to
disclose any confidential or proprietary information from the other party
relating to (i) the Intellectual Property, the Licensed Patents or Improvements
or (ii) business information relating to the Licensed Product, including without
limitation information regarding the quantity of the Licensed Product sold, the
Net Sales thereof, pricing or customer information ("the Confidential and
Proprietary Information"). Each party hereby agrees to exert its best efforts,
equivalent to the protection given to its own confidential information, to
prevent delivery or disclosure of the Confidential and Proprietary Information
to any Third Party without first obtaining the originating party's written
consent to the delivery or disclosure.

     9.2 The obligations of nondisclosure as set forth in Section 9.1 of this
Agreement will not apply to any portion of the information that:

               (i) becomes public or is received by the recipient from a Third
Party not bound by a similar obligation of secrecy; or

               (ii) is required to be disclosed by law or applicable government
regulations.

     9.3 In the event a court of competent jurisdiction orders the receiving
party to disclose all or part of the Confidential and Proprietary Information,
the receiving party shall promptly notify the originating party of same, and the
parties shall cooperate in seeking a protective order or other reasonable
assurances that the confidentiality of such information will be maintained. If
the receiving party is unable to obtain a protective order or other appropriate
remedy, the receiving party will disclose only that portion of the Confidential
and Proprietary Information as is necessary to be in compliance with the court's
order.

     9.4 No party may issue a press release or make any disclosure to any other
person or entity regarding the existence or subject matter of this Agreement
without the prior written consent of the other party, which consent shall not be
unreasonably withheld. Notwithstanding the foregoing, any party may reasonably
disclose the terms of this Agreement to the extent necessary to comply with any
laws or government regulations.

10.  MISCELLANEOUS

     10.1 Captions and section headings are used for convenience of reference
only and are not part of this Agreement and may not be used in construing it.

     10.2 The WHEREAS clauses as set forth above are incorporated herein by
reference into and are part of this Agreement.

                                       11

<PAGE>

     10.3 This Agreement may be executed in several counterparts, each of which
will be deemed an original and such counterparts will together constitute and be
one and the same instrument.

     10.4 This Agreement shall be subject to and construed according to the laws
of the State of New York without regard to conflicts of laws with any other
jurisdiction. Any litigation arising out of or relating to this Agreement shall
be brought in the state or federal courts located in Buffalo, New York, as
appropriate, and the parties expressly consent and agree to personal
jurisdiction and venue in these courts.

     10.5 This Agreement shall be binding upon and inure to the benefit of the
successors and assigns of the parties. This Agreement may not be assigned by
INFRAMAT without the prior written consent of NANO.

     10.6 If any provision of this Agreement is or becomes or is deemed invalid,
illegal or unenforceable under the applicable laws or regulations of any
jurisdiction, such provision will be deemed amended to conform to such laws or
regulations without materially altering the intention of the parties or it will
be stricken and the remainder of this Agreement will remain in full force and
effect. In the event that any provision of this Agreement is declared by a court
of competent jurisdiction to be invalid, illegal, or otherwise unenforceable,
the validity, legality, and enforceability of the remaining provisions will not
in any way be affected or impaired thereby.

     10.7 Each party further agrees that no failure or delay by the
non-breaching party, its agents or representatives, in exercising any right,
power or privilege under this Agreement shall operate as a waiver thereof unless
expressed in writing, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the exercise of any right, power or
privilege under this Agreement.

     10.8 This document constitutes the full understanding of the parties and a
complete and exclusive statement of the terms of their agreement, and no terms,
conditions, usage of trade, course of dealing, understanding or agreement
purporting to modify or vary the terms of this Agreement shall be binding unless
hereafter made in writing and signed by the party to be bound. This Agreement
supersedes all previous or contemporaneous dealings or agreements with respect
to the subject matters of this Agreement.

     10.9 No amendment, change or modification of any of the terms, provisions
or conditions of this Agreement shall be effective unless made in writing and
signed on behalf of the parties hereto by their duly authorized representatives.

     10.10 All notices provided for in this Agreement shall be deemed
sufficiently given when sent by telefacsimile and confirmed by U.S. mail or
overnight courier addressed to the party for whom intended at the following
address:

                                       12

<PAGE>

     If to NANO, to:          NanoDynamics, Inc.
                              901 Fuhrmann Boulevard
                              Buffalo, NY 14203
                              Fax: 716-853-8996
                              Attn: CEO

     If to IMC, to:           INFRAMAT CORPORATION.
                              74 Batterson Park Road
                              Farmington, Connecticut 06032
                              Fax: 860-678-7569
                              Attn: President and CEO

     If to US NANOCORP, to:   US NANOCORP, INC.
                              74 Batterson Park Road
                              Farmington, Connecticut 06032
                              Fax: 860-678-7569
                              Attn: President and CEO

     10.11 The parties mutually agree to execute, acknowledge, and deliver any
and all such other agreements, documents, instruments, and to perform any and
all such acts and things as may be reasonably necessary and proper to consummate
the transactions contemplated by this Agreement.

     10.12 Each party understands the contents of this Agreement and has had an
opportunity to thoroughly review its terms with their own attorney. In addition,
the parties acknowledge that this Agreement has been executed freely and
voluntarily upon the best judgments of the parties. The parties further
acknowledge and agree that this Agreement shall not be construed in favor of, or
against, either party by reason of the extent to which either party or their
counsel participated in the drafting of this Agreement.

     10.13 Each party represents and warrants that as of the date of the
execution of this Agreement, they have the exclusive right and authority to
execute this Agreement, and that they have not sold, assigned, transferred,
conveyed or otherwise disposed of any right referred to in this Agreement.

     10.14 Scope; US Government. Nothing in this Agreement shall be construed to
(i) grant more rights than INFRAMAT may grant under applicable laws or (ii)
infer any rights beyond what is allowable by the United States Department of
Commerce Bureau of Export Control. Notwithstanding anything to the contrary
contained in this Agreement, nothing in the Agreement precludes the rights of
the United States Government to use the Licensed Patents pursuant to any rights
it may have under any preexisting agreement or by operation of law.

11.  INDEMNIFICATION.

          (a) NANO agrees to indemnify, defend and hold INFRAMAT and its
Affiliates and its and their directors, officers, employees and agents harmless
from and against any and all loss, liability, damage and expense, including but

                                       13

<PAGE>

not limited to actual court costs and reasonable attorney's fees,
arising out of (i) the breach of any representation, warranty, covenant or
agreement of NANO set forth in this Agreement or (ii) the death or injury to any
person or damage to property resulting from the manufacture, sale, distribution
or use of any Licensed Product; and

          (b) NANO further agrees to indemnify, defend, and hold INFRAMAT and
its Affiliates, and its and their directors, officers, employees and agents
harmless from and against any claim, demand, lawsuit, loss, cost, expense,
obligation, liability, action, proceeding, agreement, contract, judgment, or
debt (including actual court costs and reasonable attorney's fees) of any nature
whatsoever, whether or not well founded in fact or in law, whether in law or
equity or otherwise, in connection with or related to use of Licensed Patents by
NANO, its customers, sub-contractors, agents, or employees (collectively, NANO
Representatives) or in connection with or related to NANO's or NANO's
Representatives' manufacture, use, sale or service of Licensed Products other
than as a result of infringement resulting from the Licensed Patents,
Intellectual Property or Improvements that is covered by the indemnification
included in (c) below .

          (c) INFRAMAT agrees to indemnify, defend and hold NANO and its
Affiliates and its and their directors, officers, employees and agents harmless
from and against any and all loss, liability, damage and expense, including but
not limited to actual court costs and reasonable attorney's fees, arising out of
(i) the breach of any representation, warranty, covenant or agreement of
INFRAMAT set forth in this Agreement, (ii) any claim that the Licensed Patents,
Intellectual Property or Improvements infringe on the intellectual property
rights of a third party.

          (d) Indemnification under Sections 11(a), 11(b), and 11(c) shall
include liability for special, incidental, punitive or consequential damages
only to the extent that the indemnified party pays such amount to a third party
in respect of a claim of such third party.

          (e) The indemnifying party shall have the exclusive right to control
any defense against any such claim, demand, lawsuit, loss, cost, expense,
obligation, liability, action, proceeding, agreement, contract, judgment or
debt, with counsel of its own choosing, and shall, unless any such settlement
would involve an admission of liability by the indemnified party or any of its
affiliates, in which event the consent of the indemnified party thereto shall be
required, have the exclusive right to settle the foregoing without the need to
obtain any consent or approval of the indemnified party or any other person, on
such terms as the indemnifying party, in its discretion, determines to be
appropriate.

                                       14

<PAGE>

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement
effective on the Effective Date.

NANODYNAMICS, INC.                      INFRAMAT CORPORATION

By: /s/ Keith A. Blakely                By: /s/ David E. Reisner
    ---------------------------------       ------------------------------------
Name: Keith A. Blakely                  Name: David E. Reisner
Title: CEO                              Title: President and CEO

Date:                                   Date: 3/22/06
      -------------------------------

                                        US NANOCORP, INC.

                                        By: /s/ David E. Reisner
                                            ------------------------------------
                                        Name: David E. Reisner
                                        Title: President and CEO
                                        Date: 3/22/06

                                       15

<PAGE>

                                    EXHIBIT A

                              INTELLECTUAL PROPERTY

US PATENT NO. 6,162,530 NANOSTRUCTURED OXIDES AND HYDROXIDES AND METHODS OF
SYNTHESIS THEREFORE (2000)

US PATENT NO. 6,517,802 METHODS OF SYNTHESIS FOR NANOSTRUCTURED OXIDES AND
HYDROXIDES (2003) - TAIWAN PATENT NO. 139,071

RUSSIA PATENT NO. 2,194,666

PENDING PATENT APPLICATIONS IN INDIA, JAPAN AND S. KOREA

PCT/US 97/21141 (11/18/97)

US PROVISIONAL PATENT APPLICATION 60/726,924 FILED 10/17/05 "WATER TREATMENT
COMPOSITIONS AND METHODS OF MAKING"

ANY PATENT APPLICATION BASED ON ANY CLAIM CONTAINED IN THE ISSUED PATENTS OR
PATENT APPLICATIONS LISTED ABOVE.

                                       16

<PAGE>

                                    EXHIBIT B

                                   C&R LICENSE

                                       17

<PAGE>

                                    EXHIBIT C
                             US NANOCORP SUBLICENSE

                                       18

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