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EXHIBIT 4.2    
  

             

  

 
 

National Australia Bank Staff
  Share Ownership Plan    
  

 
 

Trust Deed    
  

(Consolidated to include amendments

to the 5% limit (clause 4.1) approved by

the Board in November 2002)  

 Mallesons Stephen Jaques  

Rialto

525 Collins Street

Melbourne Vic 3000

Telephone (61 3) 9643 4000

Fax (61 3) 9643 5999

DX 101 Melbourne

Ref: A Clements 

 
 

CONTENTS    
  

 
  National Australia Bank Staff Share Ownership Plan Trust Deed    
  

	1	Definitions and interpretation	 	 
	
2	

Establishment of Trust	
 	
 
	
3	

Trustee	
 	
 
	 	Nature, appointment and removal	 	 
	 	Transfer of assets	 	 
	 	Powers of Trustee	 	 
	 	Instructions by Participants	 	 
	 	Remuneration of Trustee	 	 
	
4	

Maximum number of Shares issued under the Plan	
 	
 
	
5	

Acquisition of shares (other than NED Shares and Equity Shares)	
 	
 
	 	Invitation to participate	 	 
	 	Applications to participate	 	 
	 	Trustee to acquire Shares	 	 
	 	Allocation of Shares	 	 
	 	Registration in name of Trustee	 	 
	 	Separate record of Loan Shares	 	 
	 	American Depository Receipts	 	 
	 	Rights of Bank—Shares	 	 
	 	Application of this Clause	 	 
	
6	

Rights attaching to Shares	
 	
 
	 	Cash Dividends	 	 
	 	Bonus shares	 	 
	 	Rights	 	 
	 	Voting rights	 	 
	 	Absolutely Entitled	 	 
	
7	

Acquisition of NED Shares	
 	
 
	 	Invitation to participate	 	 
	 	Number and Price of Shares	 	 
	 	Application to participate	 	 
	 	Trustee to acquire Shares	 	 
	 	Allocation of Shares	 	 
	 	Registration in name of Trustee	 	 
	 	American Depository Receipts	 	 
	 	Rights of Bank—NED Shares	 	 
	
8	

Acquisition of Equity Shares	
 	
 
	 	Invitation to participate	 	 
	 	Number and Price of Shares	 	 
	 	Application to participate	 	 
	 	Trustee to acquire Shares	 	 
	 	Allocation of Shares	 	 
	 	Registration in name of Trustee	 	 
	 	American Depository Receipts	 	 
	 	Rights of Bank—Equity Shares	 	 

	
9	

Transfer of Shares—Loan Shares	
 	
 
	 	Application of clause	 	 
	 	Restriction on transfer	 	 
	 	Cessation of Employment—Loan Shares	 	 
	 	Cessation of restriction on transfer	 	 
	
10	

Transfer of Shares—Non-Loan Shares	
 	
 
	 	Application of clause	 	 
	 	Transfer after ten years	 	 
	 	Forfeiture of Shares	 	 
	 	Transfer before ten years	 	 
	 	Cessation of Employment	 	 
	
11	

Transfer of Shares—NED Shares	
 	
 
	 	Application of this Clause	 	 
	 	Ned Share Restriction Period	 	 
	 	Transfer of NED Shares	 	 
	 	Forfeiture of Shares	 	 
	 	Proceeds of Sale	 	 
	 	Costs and Expenses	 	 
	
12	

Transfer of Shares—Equity Shares	
 	
 
	 	Application of this Clause	 	 
	 	Equity Share Restriction Period	 	 
	 	Transfer of Equity Shares	 	 
	 	Forfeiture of Shares	 	 
	 	Proceeds of Sale	 	 
	 	Costs and Expenses	 	 
	
13	

Accounts	
 	
 
	
14	

Notices	
 	
 
	
15	

Audit	
 	
 
	
16	

Income and capital distributions	
 	
 
	 	Loan Shares, Non-Loan Shares, NED Shares and Equity Shares	 	 
	 	Balance of Net Income	 	 
	
17	

Amendment	
 	
 
	
18	

Obligations and Indemnity of the Trustee	
 	
 
	
19	

ASIC relief	
 	
 
	
20	

Administration of the Plan	
 	
 
	
21	

Rights of Participants	
 	
 
	 	No claim by Participant	 	 
	
22	

Termination of Trust	
 	
 
	
23	

Governing law, Jurisdiction and Process	
 	
 

  

 
 

TRUST DEED    
  

Date:  

            Parties: NATIONAL AUSTRALIA BANK LIMITED (ABN 12 004 044 937) of Level 24, 500 Bourke Street, Melbourne, Victoria

            AND  

            NATIONAL AUSTRALIA TRUSTEES LIMITED (ABN 80 007 350 405) of Level 7, 271 Collins Street, Melbourne, Victoria
("Trustee") 

Recitals:  

	A
	The
Bank wishes to establish a trust to be known as the National Australia Bank Staff Share Ownership Plan Trust to assist in the retention and motivation of employees of the Group.

	B
	The
Trustee has agreed to act as the first trustee of the Trust and has agreed to hold shares for Participating Employees on the terms and conditions set out in this Deed. 

Operative provisions:  

1          Definitions and interpretation  

	1.1
	The
following words and phrases have these meanings in this Deed unless the contrary intention appears: 

            Acceptance Date means the last date for receipt of applications to participate in the Plan as specified in the Application Form. 

            Account of a Participant means an account referred to in clause 13. 

            Accretion means any accretion, dividend, distribution, entitlement, benefit or right of whatever kind whether cash or otherwise which is
issued, declared, paid, made, arises or accrues directly or indirectly to or in respect of a Share including, without limitation any such entitlement relating to a subdivision, consolidation or other
reconstruction, any rights issue, bonus issue, Entitlements Offer, or distribution from any reserve of the Bank and any reduction of capital. 

            Application Form means an application to participate in the Plan in the form determined by the Trustee for the NED Share Plan or
otherwise by the Board, from time to time. 

            Auditor means any person registered as an auditor under the Corporations Law. 

            ASX means Australian Stock Exchange Limited. 

            Bank means National Australia Bank Limited. 

            Board means all or some of the Directors acting as a board. 

            Bonus Shares means the shares in respect of the Shares held by the Trustee on behalf of a Participant issued as part of a bonus issue to
shareholders of the Bank. 

            Cash Dividend means a dividend declared or paid with respect to Shares which is payable wholly in cash or, in the case of a dividend
declared or paid with respect to Shares which is payable only partly in cash, that part of the dividend which is payable in cash. 

            Deed means this deed. 

            Director means a director of the Bank.

 

            Employee means a permanent full time or part time employee of a body corporate which is in the Group (including a director of a body
corporate in the Group who holds on a permanent full time or part time basis salaried employment in a body corporate which is in the Group). 

            Entitlements Offer means an offer to subscribe for or otherwise acquire issued or unissued securities, whether of the Bank or any other
body. 

            Equity Share means: 

	(a)
	a
Share acquired with funds provided by the Bank or capital of the Trust or otherwise provided by the Bank and allocated to a Participating Employee in accordance with
clause 8.9;

	(b)
	a
Share allocated to a Participating Employee by virtue of clause 8.5(d); and

	(c)
	a
Bonus Share deemed to be a Equity Share by virtue of clause 6.6(e). 

            Equity Share Plan means the terms of this Deed as they apply to Equity Shares. 

            Equity Share Restriction Period means, in respect of a Equity Share, the period commencing at the date of allocation of a Equity Share to
a Participating Employee and ending on the earliest of: 

	(a)
	the
date determined by the Board at the time of grant of the Equity Share;

	(b)
	the
date that the Participating Employee is no longer employed by a company in the Group; and

	(c)
	the
date the Board notifies the Participating Employee that an Event has occurred. 

            Event means: 

	(a)
	a
takeover bid is made to the holders of issued ordinary fully paid shares in the Bank (other than as a result of an issue or transfer approved by the Trustee);

	(b)
	a
statement is lodged with the ASX to the effect that a person has become entitled to not less than 15% of all issued fully paid shares in the Bank (other than as a result of an issue
or transfer approved by the Trustee);

	(c)
	pursuant
to an application made to the court, the court orders a meeting to be held in relation to a proposed compromise or arrangement for the purpose of or in connection with a
scheme for the reconstruction of the Bank or its amalgamation with any other companies;

	(d)
	the
Bank passes a resolution for voluntary winding up; or

	(e)
	an
order is made for the compulsory winding up of the Bank. 

            Group means the Bank and each body corporate that is a subsidiary of the Bank under Division 6 of Part 1.2 of the Corporations
Law. 

            Listing Rules means the Listing Rules of ASX. 

            Loan means a loan made by the Bank under the Loan Scheme. 

            Loan Scheme means National Australia Bank Staff Share Ownership Plan—Loan Scheme. 

            Loan Scheme Participant means a Participating Employee to whom a Loan has been made by the Bank under the Loan Scheme. 

            Loan Scheme Rules means the rules of the Loan Scheme as amended from time to time. 

            Loan Share means: 

	(a)
	a
Share acquired with a Loan; and

	(b)
	a
Bonus Share deemed to be a Loan Share by virtue of clause 6.6(b). 

 

            NED Share means: 

	(a)
	a
Share acquired with funds provided by the Bank or capital of the Trust or otherwise provided by the Bank and allocated to a Participating Director in accordance with
clause 7.9;

	(b)
	a
Share allocated to a Non-Executive Director by virtue of clause 7.5(d); and

	(c)
	a
Bonus Share deemed to be a NED Share by virtue of clause 6.6(d). 

            NED Share Plan means the terms of this Deed as they apply to NED Shares. 

            NED Share Restriction Period means, in respect of a NED Share, the period commencing at the date of allocation of a NED Share to a
Participating Director and ending on the earliest of: 

	(a)
	the
date determined by the Trustee at the time of grant of the NED Share;

	(b)
	the
date that the Participating Director is no longer a director of or employed by a company in the Group; and

	(c)
	the
date the Trustee notifies the Participating Director that an Event has occurred. 

            Net Income means in respect of a financial year of the Trust, an amount which the Trustee determines to be the "net income" (as defined
in Section 95 of the Income Tax Assessment Act 1936) of the Trust for the Year of Income. 

            Non-Executive Director means a Director who is not in an executive position. 

            Non-Loan Share means: 

	(a)
	a
Share acquired with funds provided by the Bank or capital of the Trust or otherwise provided by the Bank and allocated to a Participating Employee in accordance with
clause 5.7;

	(b)
	a
Share allocated to a Participating Employee by virtue of clause 5.3(e); and

	(c)
	a
Bonus Share deemed to be a Non-Loan Share by virtue of clause 6.6(c). 

            Participant means a Participating Employee or a Participating Director, or both of these, as appropriate. 

            Participating Director means a Non-Executive Director who is participating or who has been invited and has applied to
participate in the NED Share Plan in accordance with clause 7.2. 

            Participating Employee means an Employee who is participating or who has been invited and has applied to participate in the Plan. 

            Plan means the National Australia Bank Staff Share Ownership Plan as established by this Deed, and includes the NED Share Plan and the
Equity Share Plan. 

            Related Loan means in relation to a Loan Share, the Loan which funded the acquisition of the Loan Share, or in the case of a Loan Share
which is a Bonus Share, the Loan Share in respect of which the Bonus Share was issued or deemed to be issued. 

            Retirement in relation to a Participating Employee means retirement by the Participating Employee from employment of any body corporate
in the Group at age 55 or over. 

            Rights means any rights to acquire shares or securities issued or to be issued by the Bank. 

            Shares means: 

	(a)
	the
ordinary shares in the capital of the Bank applied for or purchased by the Trustee in accordance with clauses 5, 7 or 8; 

 

	(b)
	the
ordinary shares in the capital of the Bank represented by American Depository Receipts purchased by the Trustee in accordance with clauses 5, 7 or 8; or

	(c)
	Bonus
Shares which are deemed to be Shares by virtue of clause 6.6(a). 

            Tax means all kinds of taxes (including a goods and services tax), duties, imposts, deductions, charges and withholdings imposed by a
Government, together with interest and charges. 

            Total and Permanent Disability in relation to a Participating Employee means that the Participating Employee has, in the opinion of the
Board, after considering such medical and other evidence as it sees fit, become incapacitated to such an extent as to render the Participating Employee unlikely ever to engage in any occupation for
which he or she is reasonably qualified by education, training or experience. 

            Trust means the trust to be known as the National Australia Bank Staff Share Ownership Plan Trust established by this Deed. 

            Trustee means initially National Australia Trustees Limited and thereafter means the trustee from time to time of the Trust. 

            Year of Income means a period of 12 months ending on 30 June in any year and includes the period commencing on the date of this
Deed and terminating on the next 30 June and the period ending on the date of termination of the Trust and commencing on the preceding 1 July. 

	1.2
	In
this Deed, unless the contrary intention appears:

	(a)
	the
singular includes the plural and vice versa;

	(b)
	a
reference to a recital, this Deed or a clause means the recital, this Deed or the clause as amended from time to time in accordance with this Deed;

	(c)
	a
reference to a statute or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of them;

	(d)
	a
reference to a person includes a reference to the person's executors, administrators and successors, a firm or a body corporate. 

	1.3
	Headings
are inserted for convenience and do not affect the interpretation of this Deed. 

   2          Establishment of Trust  

	2.1
	National
Australia Trustees Limited is hereby appointed by the Bank and agrees to act as trustee of the Trust on the terms of this Deed.

	2.2
	The
Trust comes into operation on the date of allotment to or purchase by the Trustee of the first Shares to be held by the Trustee on the terms of this Deed for a Participating
Employee. 

3          Trustee  

Nature, appointment and removal  

	3.1
	The
Trustee ceases to be the Trustee when:

	(a)
	either:

	(i)
	the
Trustee gives notice in writing to the Bank that it wishes to retire as Trustee; or

	(ii)
	the
Bank serves notice in writing on the Trustee that it is removed as Trustee of the Trust; and 

	(b)
	a
new Trustee is appointed. 

	3.2
	On
the retirement or removal of the Trustee, the Bank may appoint such new Trustee as it thinks fit. 

Transfer of assets  

	3.3
	On
a change of Trustee the retiring Trustee must execute all transfers, deeds or other documents necessary to transfer assets into the name of the new Trustee. 

Powers of Trustee  

	3.4
	Subject
to this Deed, the Trustee has all the powers in respect of the Trust that it is legally possible for a Trustee as a body corporate to have and, for the avoidance of doubt,
these powers are in addition to all the powers invested in trustees by the Trustee Act 1958 and (to the maximum extent permitted by law) are not subject to any restrictions on the powers of trustees
that may be imposed under the Trustee Act 1958. For example the Trustee has the following powers:

	(a)
	to
enter into and execute all contracts, deeds and documents and do all acts or things which it deems expedient for the purpose of giving effect to and carrying out the trusts, powers
and discretions conferred on the Trustee by this Deed;

	(b)
	to
subscribe for, purchase or otherwise acquire and to sell or otherwise dispose of property, rights or privileges which the Trustee is authorised to acquire or dispose of on terms
and conditions which it thinks fit;

	(c)
	to
appoint and, at its discretion, remove or suspend custodians, trustees, managers, servants and other agents, determine the powers and duties to be delegated to them, pay such
remuneration to them as it thinks fit and any person so employed or engaged is deemed for the purpose of the Deed to be employed or engaged by the Trustee;

	(d)
	to
institute, conduct, defend, compound or abandon any legal proceeding concerning the Trust and also to settle or compromise and allow time for payment or satisfaction of any debts
due and of any claims or demands by or against the Trustee in respect of the Trust; 

 

	(e)
	to
refer any claim or demand by or against the Trustee in respect of the Trust to arbitration and observe and perform awards;

	(f)
	to
make and give receipts, releases and other discharges for money payable to the Trust;

	(g)
	to
open bank accounts and to retain on current or deposit account at any bank any money which it considers proper and to make regulations for the operation of those bank accounts
including the signing and endorsing of cheques;

	(h)
	to
sell any Rights and apply the proceeds of sale in accordance with this Deed;

	(i)
	to
take and act upon the advice or opinion of any legal practitioner (whether in relation to the interpretation of this Deed, any other document or statute or as to the administration
of the trusts hereof) or any other professional person and whether obtained by the Trustee or not, without being liable in respect of any act done by it in accordance with such advice or opinion;

	(j)
	to
determine who is entitled to sign on the Trustee's behalf receipts, acceptances, endorsements, releases, contracts and documents; and

	(k)
	generally
to do all acts and things which the Trustee considers necessary or expedient for the administration, maintenance and preservation of the Trust and in performance of its
obligations under this Deed. 

Instructions by Participants  

	3.5
	For
the purposes of this Deed, the Trustee is entitled to regard as valid an instruction, consent or other authorisation given or purported to be given by a Participant whether in
writing and signed by or purporting to be signed by the Participant or in any other form approved by the Board. 

Remuneration of Trustee  

	3.6
	The
Trustee is not entitled to receive from the Trust any fees, commission or other remuneration in respect of its office, but the Bank may pay to the Trustee from the Bank's own
resources such fees as the Bank and the Trustee agree from time to time. The Trustee is entitled to retain for its own benefit any such fee.

	3.7
	The
Trustee may not use as security the Shares held by the Trustee on behalf of a Participant except to secure the repayment of a loan taken out by the Participant. 

4          Maximum number of Shares issued under the Plan  

	4.1
	In
the case of an offer with respect to unissued Shares, the number of Shares the subject of the offer when aggregated with:

	(a)
	the
number of Shares in the same class which would be issued were each outstanding offer with respect to Shares, units of Shares and options to acquire unissued Shares or units of
Shares, being an offer made or option acquired pursuant to an employee share scheme of the Bank extended only to employees or directors of the Bank and of associated bodies corporate of the Bank, to
be accepted or exercised (as the case may be); and

	(b)
	the
number of Shares in the same class issued during the previous five years pursuant to the Plan or any other employee share scheme of the Bank extended only to employees or
directors of the issuer and of associated bodies corporate of the Bank, 

 

            but
disregarding any offer made, or option acquired or Share issued by way of or as a result of: 

	(c)
	an
offer to a person situated at the time of receipt of the offer outside Australia; or

	(d)
	an
offer that was an excluded offer or invitation within the meaning of the Corporations Law as it stood prior to the commencement of Schedule 1 to the Corporate Law Economic
Reform Program Act 1999; or

	(e)
	an
offer that did not need to disclosure to investors because of section 708 of the Corporations Law, 

            must
not exceed 5% of the total number of issued shares in that class of the Bank as at the time of the offer. 

5          Acquisition of shares (other than NED Shares and Equity Shares)  

Invitation to participate  

	5.1
	The
Board may subject to any approvals of shareholders of the Bank required by law or the Listing Rules, at intervals determined by the Board, invite any Employee to participate in
the Plan. 

Number and price of Shares offered  

	5.2
	The
Board must determine the number of Shares offered to an Employee and the price per share. Different numbers of Shares may be offered to different Employees.

	5.3
	The
Board may at the time the Employee is invited to participate in the Plan either:

	(a)
	invite
the Employee to apply for a Loan, for the purpose of acquiring the Shares being offered;

	(b)
	offer
to have the Bank provide funds for the purpose of acquiring the Shares;

	(c)
	offer
to have the Bank provide shares to the Trustee without payment by the Trustee;

	(d)
	request
the Trustee to apply some of the capital of the Trust for the purpose of acquiring shares; or

	(e)
	request
the Trustee to apply some of the capital of the Trust in allocating to an Employee under the Plan Shares held by the Trustee (otherwise than on behalf of a Participant); or

	(f)
	a
combination of any of (a), (b), (c), (d) and (e). 

Applications to participate  

	5.4
	To
participate in the Plan, a Participating Employee must:

	(a)
	accept
the offer in the manner or a manner specified in the invitation made by the Board under clause 5.1; and

	(b)
	instruct
the Trustee in writing to allocate to the Participating Employee the whole of the nominated number of Shares and this instruction must be forwarded to the Trustee on or prior
to the Acceptance Date. 

	5.5
	The
instructions to the Trustee must be in such form as may be determined by the Board from time to time but must include a confirmation that the Employee agrees to be bound by the
terms of this Deed and the constitution of the Bank and, if they are invited and elect to participate in the Loan Scheme, the Loan Scheme Rules. 

 

Trustee to acquire Shares  

	5.6
	Subject
to the Trustee receiving sufficient payment (whether being the proceeds of a Loan provided to the Participating Employee by the Bank under the Loan Scheme or payment from the
Bank) or having sufficient capital for the purposes of clause 5.3(d), by not later than 30 days (or such other period as the Board determines) after the Acceptance Date the Trustee must,
at the election of the Bank:

	(a)
	purchase
fully paid Shares on behalf of a Participating Employee; or

	(b)
	subscribe
for and the Bank must issue to the Trustee fully paid Shares on behalf of a Participating Employee. 

            Where
the Trustee receives an offer to subscribe for Shares without payment by the Trustee, by not later than 30 days (or such other period as the Board determines) after the
Acceptance Date the Trustee must subscribe for and the Bank must issue to the Trustee fully paid Shares on behalf of a Participating Employee. 

Allocation of Shares  

	5.7
	The
Trustee will allocate to a Participating Employee whose offer to participate in the Plan is accepted fully paid Shares held by the Trustee (otherwise than for a Participant) to be
held for the benefit of that Participating Employee. 

Registration in name of Trustee  

	5.8
	The
Shares must be registered in the name of the Trustee on issue or purchase and on allocation by the Trustee be held on the terms of this Deed by the Trustee on behalf of the
Participating Employee who is the beneficial owner of the Shares. 

Separate record of Loan Shares  

	5.9
	The
Trustee will maintain a record of which Shares have been paid for out of the proceeds of a Loan and those Shares must be maintained as a separate holding until the relevant Loan
has been repaid. 

American Depository Receipts  

	5.10
	The
Trustee may, with the Board's approval hold shares on behalf of a Participating Employee in the capital of the Bank represented by American Depository Receipts in the Bank. 

Rights of Bank—Shares  

	5.11
	Nothing
in this Deed confers or is intended to confer on the Bank, any charge, lien or any other proprietary right or proprietary interest in the Shares. The rights of the Bank under
this Deed are purely contractual. 

Application of this Clause  

	5.12
	This
clause 5 only applies to Loan Shares and Non-Loan Shares. 

6          Rights attaching to Shares  

Cash Dividends  

	6.1
	Subject
to the terms of this Deed, a Participant is entitled to receive all Cash Dividends paid on the Shares. 

 

	6.2
	The
Board may make it a term of an invitation to participate in the Plan that, in respect of a Loan Share, a proportion of each Cash Dividend paid on that Share be applied in
repayment of the Loan. The proportion specified as a term of the invitation to participate in the Plan may vary, may be determined from time to time by the Board and may be 100%.

	6.3
	The
Trustee must, if so directed by a Participant, apply a proportion of each Cash Dividend in repayment of the Loan made to the Employee to acquire the Loan Share. 

Bonus shares  

	6.4
	Subject
to clause 6.5, a Participant is entitled to any Bonus Shares which accrue to Shares held by the Trustee on behalf of that Participant.

	6.5
	The
Bonus Shares must be registered in the name of the Trustee and held in trust by the Trustee on behalf of the Participant, who is the beneficial owner of the Bonus Shares.

	6.6
	Upon
issue to the Trustee:

	(a)
	Bonus
Shares are deemed to be Shares for the purposes of this Deed;

	(b)
	Bonus
Shares issued in respect of Loan Shares are deemed to be Loan Shares for the purposes of this Deed;

	(c)
	Bonus
Shares issued in respect of Non-Loan Shares are deemed to be Non-Loan Shares for the purpose of this Deed;

	(d)
	Bonus
Shares issued in respect of NED Shares are deemed to be NED Shares for the purpose of this Deed; and

	(e)
	Bonus
Shares issued in respect of Equity Shares are deemed to be Equity Shares of the purpose of this Deed. 

	6.7
	The
Bonus Shares (other than Bonus Shares which are deemed to be NED Shares) will be deemed to be acquired on a date determined by the Board. Bonus Shares which are deemed to be NED
Shares will be deemed to be acquired on the date of allocation of the NED Shares to which they relate. 

Rights  

	6.8
	The
Trustee will send a notice to a Participant of any Rights which accrue to Shares held by the Trustee on behalf of that Participant.

	6.9
	Within
7 days of receiving the notice referred to in clause 6.8, the Participant may provide the Trustee with either: 

	 	 	(a)	 	 	 	written instructions in the form (if any) prescribed by the Bank to sell some or all of the Rights to the extent permitted by law; or
	

 	
 	

(b)	
 	

(i)	
 	

written instructions in the form (if any) prescribed by the Bank to acquire, to the extent permitted by law, some or all of the shares or securities in the Bank to which the Rights relate; and
	

 	
 	

 	
 	

(ii)	
 	

payment of an amount equal to the cost of accepting the Rights entitlement plus, if the Trustee so requires, such additional amount as the Trustee estimates (and notifies to the Participant) to be the cost of transferring the shares or securities to
the Participant.

 

	6.10
	If
the Participant does not give a notice under clause 6.9, the Trustee is entitled to sell the Rights.

	6.11
	Subject
to clause 6.12, if the Trustee sells the Rights in accordance with clause 6.9 or clause 6.10, the Trustee must distribute the proceeds of the sale (after
deduction of the costs of sale incurred by the Trustee) to the Participant.

	6.12
	If
the Shares to which the Rights accrued were Loan Shares, the Participant irrevocably directs the Trustee to pay the proceeds of the sale of Rights to the Bank and the Bank agrees
to apply those proceeds in reduction of the Loan for the Loan Shares.

	6.13
	If
the Trustee acquires, on behalf of the Participant, a specified number of shares or securities pursuant to the Rights in accordance with clause 6.9(b), the Trustee shall
transfer those shares or securities to the Participant. The Trustee may make it a condition of transfer that the Participant pay the cost of transfer (including stamp duty). 

Other accretions  

	6.14
	If
an Accretion arises in respect of a Share other than by way of:

	(a)
	Cash
Dividend;

	(b)
	Bonus
Shares; or

	(c)
	Rights,

the
Trustee may in its absolute discretion decide to transfer, or provide the benefit of, all or such part of the Accretion as the Trustee determines to the Participant, unless to do so would cause an
exemption condition in section 139CE of the Income Tax Assessment Act 1936 not to be satisfied. 

Voting rights  

	6.15
	A
copy of the notice of all general meetings of shareholders of the Bank received by the Trustee must be forwarded to a Participant if the Participant stipulates, prior to receipt of
the notice of general meeting by the Trustee, in writing in the form (if any) prescribed by the Bank that he or she wishes to receive a copy of all notices for the calendar year in which the
prescribed form is received by the Trustee.

	6.16
	The
Participant may give the Trustee a written notice from the Participant to vote in respect of Shares held for the Participant.

	6.17
	The
Trustee must exercise the voting rights attaching to Shares in accordance with the prior written instructions of a Participant given in accordance with clause 6.16 and
received by the Trustee not less than 72 hours prior to the relevant meeting.

	6.18
	In
default of the Trustee receiving prior written instructions from a Participant given in accordance with clause 6.16, the Trustee may exercise the voting rights attaching to
the Shares of the Participant as it thinks fit (including without limitation a power to abstain from voting). 

Absolutely Entitled  

	6.19
	Each
Share is held by the Trustee for the Participant who is in accordance with the terms of this Deed absolutely entitled to the Share as against the Trustee. 

   7          Acquisition of NED Shares  

Application of this Clause  

	7.1
	This
clause 7 only applies to NED Shares. 

Invitation to participate  

	7.2
	The
Board may, subject to any approvals of shareholders of the Bank required by law or the Listing Rules, at intervals determined by the Board, invite any Non-Executive
Directors to participate in the NED Share Plan. 

Number and Price of Shares  

	7.3
	The
Board must determine the number of NED Shares for which a Non-Executive Director is invited to apply. Different numbers of Shares may be offered to different
Non-Executive Directors.

	7.4
	A
Non-Executive Director is not liable to make a payment upon acceptance of an offer made by the Non-Executive Director under the NED Share Plan for NED
Shares.

	7.5
	The
Board may at the time a Non-Executive Director is invited to participate in the Plan either:

	(a)
	offer
to have the Bank provide funds for the purpose of acquiring the Shares;

	(b)
	offer
to have the Bank provide shares to the Trustee without payment by the Trustee;

	(c)
	request
the Trustee to apply some of the capital of the Trust for the purpose of acquiring the NED Shares; or

	(d)
	request
the Trustee to apply some of the capital of the Trust in allocating to a Non-Executive Director under the NED Share Plan Shares held by the Trustee (otherwise than
on behalf of a Participant); or

	(e)
	a
combination of any of (a), (b), (c) and (d). 

Application to participate  

	7.6
	To
participate in the NED Share Plan, a Non-Executive Director must send a copy of an Application Form which complies with the terms of the invitation made by the Board
under clause 7.2 to the Trustee.

	7.7
	The
Application Form must include:

	(a)
	a
confirmation that the Non-Executive Director agrees to be bound by the terms of this deed and the constitution of the Bank; and

	(b)
	an
offer by the Participating Director to participate in the NED Share Plan. 

Trustee to acquire Shares  

	7.8
	Subject
to the Trustee receiving sufficient payment or having sufficient capital for the purposes of clause 7.5(c), the Trustee may, at the election of the Bank:

	(a)
	purchase
fully paid Shares to be held on behalf of a Participating Director; or

	(b)
	subscribe
for and the Bank must issue to the Trustee fully paid Shares to be held on behalf of a Participating Director. 

 

            Where
the Trustee receives an offer to subscribe for Shares without payment by the Trustee, the Trustee must subscribe for and the Bank must issue to the Trustee fully paid Shares on
behalf of a Participating Director. 

Allocation of Shares  

	7.9
	The
Trustee will allocate to a Participating Director whose offer to participate in the NED Share Plan is accepted fully paid Shares held by the Trustee (otherwise than on behalf of a
Participant) to be held for the benefit of that Participating Director. 

Registration in name of Trustee  

	7.10
	The
Shares must be registered in the name of the Trustee on issue or purchase and on allocation by the Trustee be held on the terms of this Deed by the Trustee on behalf of the
Participating Director who is the beneficial owner of the Shares. 

American Depository Receipts  

	7.11
	The
Trustee may, with the Board's approval hold Shares on behalf of a Participating Director in the capital of the Bank represented by American Depository Receipts in the Bank. 

Rights of Bank—NED Shares  

	7.12
	Nothing
in this Deed confers or is intended to confer on the Bank, any charge, lien or any other proprietary right or proprietary interest in the NED Shares. The rights of the Bank
under this Deed are purely contractual. 

8          Acquisition of Equity Shares  

Application of this Clause  

	8.1
	This
clause 8 only applies to Equity Shares. 

Invitation to participate  

	8.2
	The
Board may, subject to any approvals of shareholders of the Bank required by law or the Listing Rules, at intervals determined by the Board, invite any Participating Employees to
participate in the Equity Share Plan. 

Number and Price of Shares  

	8.3
	The
Board must determine the number of Equity Shares for which a Participating Employee is invited to apply. Different numbers of Shares may be offered to different Participating
Employees.

	8.4
	A
Participating Employee is not liable to make a payment upon acceptance of an offer made by the Participating Employee under the Equity Share Plan for Equity Shares.

	8.5
	The
Board may at the time a Participating Employee is invited to participate in the Plan either:

	(a)
	offer
to have the Bank provide funds for the purpose of acquiring the Equity Shares;

	(b)
	offer
to have the Bank provide Equity Shares to the Trustee without payment by the Trustee;

	(c)
	request
the Trustee to apply some of the capital of the Trust for the purpose of acquiring the Equity Shares; or 

 

	(d)
	request
the Trustee to apply some of the capital of the Trust in allocating to a Participating Employee under the Equity Share Plan Shares held by the Trustee (otherwise than on
behalf of a Participating Employee); or

	(e)
	a
combination of any of (a), (b), (c) and (d). 

Application to participate  

	8.6
	To
participate in the Equity Share Plan, a Participating Employee must send a copy of an Application Form which complies with the terms of the invitation made by the Board under
clause 8.2 to the Trustee.

	8.7
	The
Application Form must include:

	(a)
	a
confirmation that the Participating Employee agrees to be bound by the terms of this deed and the constitution of the Bank; and

	(b)
	an
offer by the Participating Employee to participate in the Equity Share Plan. 

Trustee to acquire Shares  

	8.8
	Subject
to the Trustee receiving sufficient payment or having sufficient capital for the purposes of clause 8.5(c), the Trustee may, at the election of the Bank:

	(a)
	purchase
fully paid Shares to be held on behalf of a Participating Employee; or

	(b)
	subscribe
for and the Bank must issue to the Trustee fully paid Shares to be held on behalf of a Participating Employee. 

            Where
the Trustee receives an offer to subscribe for Shares without payment by the Trustee, the Trustee must subscribe for and the Bank must issue to the Trustee fully paid Shares on
behalf of a Participating Employee. 

Allocation of Shares  

	8.9
	The
Trustee will allocate to a Participating Employee whose offer to participate in the Equity Share Plan is accepted fully paid Shares held by the Trustee (otherwise than on behalf
of a Participating Employee) to be held for the benefit of that Participating Employee. 

Registration in name of Trustee  

	8.10
	The
Shares must be registered in the name of the Trustee on issue or purchase and on allocation by the Trustee be held on the terms of this Deed by the Trustee on behalf of the
Participating Employee who is the beneficial owner of the Shares. 

American Depository Receipts  

	8.11
	The
Trustee may, with the Board's approval hold Shares on behalf of a Participating Employee in the capital of the Bank represented by American Depository Receipts in the Bank. 

Rights of Bank—Equity Shares  

	8.12
	Nothing
in this Deed confers or is intended to confer on the Bank, any charge, lien or any other proprietary right or proprietary interest in the Equity Shares. The rights of the
Bank under this Deed are purely contractual.

 

9          Transfer of Shares—Loan Shares  

Application of clause  

	9.1
	This
clause 9 applies only to a Loan Share held by the Trustee on behalf of a Participating Employee. 

Restriction on transfer  

	9.2
	The
Trustee must not transfer a Loan Share to which this clause 9 applies except in the circumstances set out in this clause 9 or unless compelled by law. 

Cessation of Employment—Loan Shares  

	9.3
	If
a Participating Employee ceases to be an Employee, the Participating Employee may at any time within a period of 12 months from the date the Participating Employee ceases to
be an Employee give notice to the Trustee that they wish to deal in a Loan Share held by the Trustee on behalf of the Participating Employee.

	9.4
	The
Participating Employee may in the circumstances described in clause 9.3:

	(a)
	request
the Trustee to sell the Loan Share; or

	(b)
	if
an amount remains outstanding on the Loan, repay the Loan and request the Trustee to transfer the Loan Share to the Participating Employee; or

	(c)
	if
no amount remains outstanding on the Loan, request the Trustee to transfer the Loan Share to the Participating Employee. 

Cessation of restriction on transfer  

	9.5
	If
no amount remains outstanding on the Loan with which the Loan Share was acquired:

	(a)
	the
Participating Employee may give notice to the Trustee stating that the Participating Employee wishes to deal in the Loan Share; and

	(b)
	if
the Trustee has not received notice at the end of 60 days after the date that no amount is outstanding on the Loan with which the Loan Share was acquired that the
Participating Employee wishes to deal in the Loan Share, the Trustee may:

	(i)
	transfer
the Loan Share to the Participating Employee; or

	(ii)
	sell
the Loan Share and pay the proceeds (after deducting any costs of sale) to the Participating Employee. 

	9.6
	When
giving a notice to the Trustee under clause 9.5, the Participating Employee may:

	(a)
	request
the Trustee to transfer the Loan Share to the Participating Employee; or

	(b)
	request
the Trustee to sell the Loan Share. 

	9.7
	If
an amount remains outstanding on the Related Loan, the Participating Employee may request the Trustee to sell the Loan Share.

	9.8
	If:

	(a)
	a
request is made under clauses 9.4 or 9.6 to transfer a Loan Share to the Participating Employee; and

	(b)
	the
Bank informs the Trustee that no amount remains outstanding on the Related Loan, 

 

            the
Trustee must transfer the Loan Share to the Participating Employee. The Loan Share must not be transferred until the Trustee has been informed by the Bank that no amount remains
outstanding on the Loan Share. 

	9.9
	If
the Participating Employee requests the Trustee to sell a Loan Share in accordance with clauses 9.4 or 9.6, the Trustee must sell the Loan Share.

	9.10
	If
the Participating Employee requests the Trustee to sell a Loan Share in accordance with clause 9.7, the Trustee may only sell the Loan Share if the Board's approval is
obtained.

	9.11
	The
proceeds of sale from the sale of a Loan Share referred to in clauses 9.9 or 9.10 must first be applied in repayment of any amount outstanding on the Related Loan and the balance
(after deducting all costs of sale), if any, must be paid to the Participating Employee.

	9.12
	The
Participating Employee may not sell encumber or otherwise deal with a Loan Share or any legal or beneficial interest in a Loan Share unless and until the Loan Share has been
transferred to the Participating Employee.

	9.13
	If:

	(a)
	at
the end of the period of 12 months referred to in clause 9.3 the Trustee has not received a request under clause 9.4; or

	(b)
	the
Loan has become immediately due and payable, 

            the
Trustee may: 

	(c)
	sell
a Loan Share;

	(d)
	apply
the proceeds in repayment of the Related Loan; and

	(e)
	pay
the balance (after deducting any costs of sale), to the Participating Employee. 

	9.14
	If
the Trustee is to transfer the Loan Shares to the Participating Employee, the Trustee may require the Participating Employee to reimburse the Trustee in respect of any costs and
duties associated with the transfer of the Loan Shares. 

10        Transfer of Shares—Non-Loan Shares  

Application of clause  

	10.1
	This
clause 10 applies only to a Non-Loan Share held by the Trustee on behalf of a Participating Employee. 

Transfer after ten years  

	10.2
	A
Non-Loan Share must be transferred to the Participating Employee at the expiration of ten years after the date the Non-Loan Share was issued to or purchased
by the Trustee. 

Forfeiture of Shares  

	10.3
	If
the Participating Employee's employment by a body corporate in the Group is terminated because, in the opinion of his or her employer, he or she engages in any act or omission
constituting serious misconduct involving dishonesty the Trustee may sell all Non-Loan Shares held on behalf of that Participating Employee and the Participating Employee has no
entitlement to the proceeds of sale which are treated as an accretion to the Trust. 

 

Transfer before ten years  

	10.4
	Except
where an event described in clause 10.3 has occurred, a Non-Loan Share held by the Trustee on behalf of a Participating Employee must not, before the
expiration of the ten year period referred to in clause 10.2, be:

	(a)
	sold
by the Trustee on behalf of the Participating Employee; or

	(b)
	transferred
to the Participating Employee, 

            unless:

	(c)
	the
Board decides otherwise; or

	(d)
	the
Participating Employee ceases to be an Employee. 

Cessation of Employment  

	10.5
	If
a Participating Employee ceases to be an Employee, the Participating Employee may at any time within a period of 12 months from the date the Participating Employee ceases
to be an Employee give notice to the Trustee that they wish to deal in a Non-Loan Share held by the Trustee on behalf of the Participating Employee.

	10.6
	The
Participating Employee may in the circumstances described in clause 10.5:

	(a)
	request
the Trustee to sell the Non-Loan Share held by the Trustee on behalf of the Participating Employee; or

	(b)
	request
the Trustee to transfer the Non-Loan Share held by the Trustee on behalf of the Participating Employee to the Participating Employee. 

	10.7
	If
at the end of the period of 12 months referred to in clause 10.5 the Trustee has not received a request under clause 10.6 the Trustee may:

	(a)
	sell
the Non-Loan Share; or

	(b)
	transfer
the Non-Loan Shares to the Participating Employee. 

	10.8
	The
Participating Employee may not sell encumber or otherwise deal with a Non-Loan Share or any legal or beneficial interest in a Non-Loan Share unless and
until the Non-Loan Share has been transferred to the Participating Employee.

	10.9
	If
Non-Loan Shares are sold under clauses 10.4 or 10.7, the Trustee must as soon as practicable pay the sale proceeds (after deducting all costs of sale) to the
Participating Employee.

	10.10
	If
the Participating Employee requests the Trustee to transfer Non-Loan Shares to the Participating Employee, the Trustee may require the Participating Employee to
reimburse the Trustee in respect of any costs and duties associated with the transfer of the Non-Loan Shares. 

   11        Transfer of Shares—NED Shares  

Application of this Clause  

	11.1
	This
clause 11 applies only to a NED Share held by the Trustee on behalf of a Participating Director. 

Ned Share Restriction Period  

	11.2
	For
the purpose of the definition of NED Share Restriction Period, the Trustee:

	(a)
	must
determine the date referred to at paragraph (a) of the definition; and

	(b)
	may,
if an Event happens, in its absolute discretion notify Participating Directors in accordance with paragraph (c) of the definition. 

Transfer of NED Shares  

	11.3
	The
Trustee may determine that the terms of issue of NED Shares provide for the circumstances when a Participating Director may assign, transfer, sell, encumber or otherwise deal
with a NED Share.

	11.4
	The
Trustee must not assign, transfer, sell, encumber or otherwise deal with a NED Share except:

	(a)
	at
the end of the NED Share Restriction Period;

	(b)
	in
the circumstances set out in the terms of issue of the NED Shares or, subject to the terms of issue of the NED Shares, in accordance in this clause 11; or

	(c)
	unless
compelled by law. 

	11.5
	The
Participating Director must not assign, transfer, sell, encumber or, subject to the terms of issue of the NED Shares, otherwise deal with a NED Share or any legal or beneficial
interest in a NED Share unless and until the NED Share has been transferred to the Participating Director in accordance with the terms of issue of the NED Shares or otherwise in accordance with this
clause 11.

	11.6
	At
the end of the NED Share Restriction Period, a Participating Director has until the day that is 2 months from the end of the NED Share Restriction Period, or if that day is
not a business day, the next business day, to either:

	(a)
	request
the Trustee to sell all of the NED Shares held by the Trustee on behalf of the Participating Director; or

	(b)
	request
the Trustee to transfer the NED Shares held by the Trustee on behalf of the Participating Director to the Participating Director. 

	11.7
	If
the Trustee does not receive a request in accordance with clause 11.6 after the end of the notice period referred to in clause 11.6, then the Trustee must transfer
the NED Shares to the Participating Director within 6 months of the end of that notice period. 

Forfeiture of Shares  

	11.8
	The
Trustee may determine that the terms of issue of NED Shares provide in certain circumstances determined by the Trustee that a Participating Director will forfeit any interest in
the NED Shares and the NED Shares will in those circumstances be treated as an accretion to the Trust. 

 

Proceeds of Sale  

	11.9
	If
NED Shares are sold under this clause 11 the Trustee must as soon as practicable pay the sale proceeds (after deducting all costs of sale) to the Participating Director. 

Costs and Expenses  

	11.10
	If
the Trustee proposes to transfer the NED Shares to the Participating Director, the Trustee may require the Participating Director to reimburse the Trustee in respect of any costs
and duties associated with the transfer of the NED Shares. 

12        Transfer of Shares—Equity Shares  

Application of this Clause  

	12.1
	This
clause 12 applies only to a Equity Share held by the Trustee on behalf of a Participating Employee. 

Equity Share Restriction Period  

	12.2
	For
the purpose of the definition of Equity Share Restriction Period. The Board:

	(a)
	must
determine the date referred to at paragraph (a) of the definition; and

	(b)
	may,
if an Event happens, in its absolute discretion notify Participating Employees in accordance with paragraph (c) of the definition. 

Transfer of Equity Shares  

	12.3
	The
Board may determine that the terms of issue of Equity Shares provide for the circumstances when a Participating Employee may assign, transfer, sell, encumber or otherwise deal
with a Equity Share.

	12.4
	The
Trustee must not assign, transfer, sell, encumber or otherwise deal with a Equity Share except:

	(a)
	at
the end of the Equity Share Restriction Period;

	(b)
	in
the circumstances set out in the terms of issue of the Equity Shares or, subject to the terms of issue of the Equity Shares, in accordance in this clause 12; or

	(c)
	unless
compelled by law. 

	12.5
	The
Participating Employee must not assign, transfer, sell, encumber or, subject to the terms of issue of the Equity Shares, otherwise deal with a Equity Share or any legal or
beneficial interest in a Equity Share unless and until the Equity Share has been transferred to the Participating Employee in accordance with the terms of issue of the Equity Shares or otherwise in
accordance with this clause 12.

	12.6
	At
the end of the Equity Share Restriction Period, a Participating Employee has until the day that is 2 months from the end of the Equity Share Restriction Period, or if that
day is not a business day, the next business day, to either:

	(a)
	request
the Trustee to sell all of the Equity Shares held by the Trustee on behalf of the Participating Employee; or

	(b)
	request
the Trustee to transfer the Equity Shares held by the Trustee on behalf of the Participating Employee to the Participating Employee. 

 

	12.7
	If
the Trustee does not receive a request in accordance with clause 12.6 after the end of the notice period referred to in clause 12.6, then the Trustee must transfer
the Equity Shares to the Participating Employee within 6 months of the end of that notice period. 

Forfeiture of Shares  

	12.8
	The
Board may determine that the terms of issue of Equity Shares provide in certain circumstances determined by the Trustee that a Participating Employee will forfeit any interest in
the Equity Shares and the Equity Shares will in those circumstances be treated as an accretion to the Trust. 

Proceeds of Sale  

	12.9
	If
Equity Shares are sold under this clause 12 the Trustee must as soon as practicable pay the sale proceeds (after deducting all costs of sale) to the Participating Employee. 

Costs and Expenses  

	12.10
	If
the Trustee proposes to transfer the Equity Shares to the Participating Employee, the Trustee may require the Participating Employee to reimburse the Trustee in respect of any
costs and duties associated with the transfer of the Equity Shares. 

13        Accounts  

	13.1
	The
Trustee must open and maintain an account in respect of each Participant.

	13.2
	Each
Account must record:

	(a)
	the
number of Loan Shares and Non-Loan Shares to which each Participating Employee is entitled;

	(b)
	the
number of NED Shares to which each Participating Director is entitled;

	(c)
	the
number of Equity Shares to which each Participating Employee is entitled;

	(d)
	the
date of acquisition of Shares to which each Participant is entitled;

	(e)
	the
number of Bonus Shares (if any) to which each Participant is entitled and whether the Bonus Shares are Loan Shares, Non-Loan Shares or NED Shares or Equity Shares; and

	(f)
	the
number of Loan Shares to which the Participating Employee is entitled in respect of the Related Loan. 

14        Notices  

	14.1
	Any
notice to be given by the Trustee shall be deemed to have been duly given if:

	(a)
	sent
by electronic mail or delivered; or

	(b)
	sent
by ordinary prepaid mail, 

            and
shall be deemed to have been served: 

	(c)
	if
sent by electronic mail or delivered, at the time of delivery or sending; or

	(d)
	if
posted, three days after the date of posting, excluding Saturdays, Sundays and public holidays but, if the address of any Participant is outside Australia, then 7 days shall
be substituted for three days for any notice given to or by that Participant. 

 

	14.2
	Delivery,
transmission and postage shall be to the address of any Participant as indicated on the application form or such other address as the Trustee or any Participant may notify
to the other. 

15        Audit  

	15.1
	The
Trustee shall keep or cause to be kept true accounts of all sums of money received and expended by or on behalf of the Trust and the matters in respect of which such receipt and
expenditure takes place and of all sales and purchases of shares and of the assets and liabilities of the Trust.

	15.2
	The
books of account of the Trust shall be maintained at the registered office of the Bank and shall be available for inspection by Participants during normal business hours free of
charge upon prior written request.

	15.3
	The
Trustee shall appoint an Auditor of the Trust.

	15.4
	The
Trustee shall cause the books of account to be audited annually by the Auditor of the Trustee.

	15.5
	The
Trustee must ensure that the Auditor of the Trustee has access to all papers, accounts and documents concerned with or relating to the Trust. 

16        Income and capital distributions  

Loan Shares, Non-Loan Shares, NED Shares and Equity Shares  

	16.1
	A
Participant is presently entitled to so much of the Net Income of the Trust for a Year of Income which is attributable to:

	(a)
	the
Shares held by the Trustee on behalf of the Participant;

	(b)
	the
proceeds of sales arising from the sale of Rights by the Trustee on behalf of the Participant; and

	(c)
	transactions
or events related to Shares and, or property related to or arising from Shares held by the Trustee on behalf of the Participant. 

Balance of Net Income  

	16.2
	The
balance of the Net Income of the Trust for a Year of Income to which no Participant is presently entitled in accordance with clause 16.1 may be applied, in whole or in
part, for the benefit of one or more of the following beneficiaries as the Trustee thinks fit:

	(a)
	an
Employee (other than a director of a body corporate in the Group);

	(b)
	a
Participant (other than a director of a body corporate in the Group);

	(c)
	a
provident, benefit, superannuation or retirement fund established and maintained by the Bank; or

	(d)
	any
charity nominated by the Trustee. 

	16.3
	The
balance of the Net Income of the Trust for a Year of Income to which no Participant is presently entitled in accordance with clause 16.1 and not applied in accordance with
clause 16.2 may be accumulated by the Trustee as an accretion to the Trust. 

 

	16.4
	The
Trustee may prior to the termination of the Trust as set out in clause 22.1, if it thinks fit, apply that part of the capital of the Trust to which no Participant would be
entitled as set out in clause 22 if the Trust was terminated at that time, in one or more of the following:

	(a)
	in
payment of any costs and expenses incurred by the Trustee in the execution or purported execution of the Trust or any of the powers, authorities or discretions vested in the
Trustee; or

	(b)
	for
the benefit of any of the following beneficiaries as the Trustee thinks fit:

	(i)
	an
Employee;

	(ii)
	a
Participant (including the purchase or allocation of Shares in accordance with clauses 5.3(d) or (e) and clauses 7.5(c) or (d) and clauses 8.5(c) and (d)); or

	(iii)
	a
provident, benefit, superannuation or retirement fund established and maintained by the Bank. 

17        Amendment  

	17.1
	Subject
to clauses 17.2 and 17.3, the Bank may at any time by written instrument or by resolution of the Board, amend all or any of the provisions of this Deed (including this
clause 17).

	17.2
	No
amendment of the provisions of this Deed is to reduce the rights of any Participant in respect of Shares credited to the Account of the Participant prior to the date of the
amendment, other than an amendment introduced primarily:

	(a)
	for
the purpose of complying with or conforming to present or future State, Territory or Commonwealth legal requirements governing or regulating the maintenance or operation of the
Plan or like plans;

	(b)
	to
correct any manifest error or mistake;

	(c)
	to
enable contributions or other amounts paid by any body corporate in the Group to the Trust to qualify as income tax deductions for that body corporate or any other body corporate
in the Group;

	(d)
	to
enable the Trustee, the Participant or any body corporate in the Group to reduce the amount of fringe benefits tax under the Fringe Benefits Tax Assessment Act 1986, the amount of
tax under the
Income Tax Assessment Act 1936 or the amount of any other tax or impost that may otherwise be payable by the Trustee, the Participant or the body corporate in relation to the Trust;

	(e)
	for
the purpose of enabling the Participants generally (but not necessarily each Participant) to receive a more favourable taxation treatment in respect of their participation in the
Trust; or

	(f)
	to
enable the Trustee or any body corporate in the Group to comply with the Corporations Law or the Listing Rules. 

	17.3
	No
amendment may be made except in accordance with and in the manner (if any) stipulated by the Listing Rules.

	17.4
	Subject
to the above provisions of this clause 17, any amendment made pursuant to clause 17.1 may be given such retrospective effect as is specified in the written
instrument or resolution by which the amendment is made. 

 

18        Obligations and Indemnity of the Trustee  

	18.1
	Without
derogating from the right of indemnity given by law to trustees, the Bank hereby covenants with the Trustee that it will indemnify and keep indemnified the Trustee in respect
of all liabilities, costs and expenses incurred by the Trustee in the execution or purported execution of the Trust or any of the powers, authorities or discretions vested in the Trustee and from and
against all actions, proceedings, costs, claims and demands in respect of any matter or thing done or omitted other than a claim arising out of the Trustee's negligence, dishonesty or the Trustee
wilfully or knowingly being a party to a breach of trust.

	18.2
	The
Trustee shall not be under any liability whatsoever except for its negligence, dishonesty, fraud or wilful default or except for the negligence, default or wilful breach of trust
committed by any of its employees or agents acting as such.

	18.3
	Without
limiting clause 18.2, where the Trustee sells Shares under clauses 9, 10, 11 or 12 which were allocated to a Participant's Account after the date of execution of the
supplemental deed which added this clause 18.3, the Trustee:

	(a)
	has
no obligation to maximise the sale price of the Shares;

	(b)
	may
sell the Shares with other Shares (whether or not held on behalf of the Participant); and

	(c)
	in
relation to its obligation to pay the sale proceeds (if any) to the Participants:

	(i)
	may
deduct any costs of the sale before making a payment to the Participant; and

	(ii)
	may
attribute a sale price to each Share as the Trustee considers appropriate. 

	18.4
	Subject
to any amount remaining outstanding on the Loan and to clause 18.5, nothing in this clause 18.1 enables the Trustee to recover any liabilities, costs and
expenses from any Participant.

	18.5
	The
Trustee is entitled to be indemnified by a Participant in respect of any Tax payable by the Trustee in respect of Shares held by the Trustee on behalf of the Participant.

	18.6
	Except
as expressly provided in this Deed, the Trustee will have no right of indemnity from a Participant personally. 

19        ASIC relief  

	19.1
	Notwithstanding
any other provisions of this Deed, every covenant or other provision set out in an exemption or modification granted from time to time by the Australian Securities
and Investments Commission in respect of the Plan pursuant to Chapters 2L and 6D of the Corporations Law and required to be included in this Deed in order for that exemption or modification to have
full effect, is deemed to be contained in this Deed. To the extent that any covenant or other provision deemed by
this clause to be contained in this Deed is inconsistent with any other provision in this Deed, the deemed covenant or other provision shall prevail. 

20        Administration of the Plan  

	20.1
	The
Plan will be administered by the Trustee and the Board in accordance with this Deed. The Board may make further rules for the operation of the Plan which are consistent with this
Deed.

	20.2
	Any
power or discretion which is conferred on the Board by this Deed must be exercised by the Board in the interests or for the benefit of the Bank, and the Board is not, in
exercising any such power or discretion, under any fiduciary or other obligation to any other person. 

 

	20.3
	Any
power or discretion which is conferred on the Board by this Deed may be delegated by the Board to a committee consisting of such Directors and/or other officers and/or employees
of the Bank as the Board thinks fit.

	20.4
	The
decision of the Board as to the interpretation, effect or application of this Deed will be final and conclusive.

	20.5
	The
Trustee and the Bank may from time to time require a Participant to complete and return such other documents as may be required by law to be completed by the Participants or such
other documents which the Trustee or the Bank considers should, for legal or taxation reasons, be completed by the Participant.

	20.6
	The
Board may from time to time suspend the operation of the Plan and may at any time cancel the Plan. The suspension or cancellation of the Plan will not prejudice the existing
rights of Participants. 

21        Rights of Participants  

	21.1
	Except
as expressly provided in this Deed, nothing in this Deed:

	(a)
	confers
on any Employee or Non-Executive Director the right to receive any Shares;

	(b)
	confers
on any Participant the right to continue as an employee or director of any body corporate in the Group;

	(c)
	affects
any rights which any body corporate in the Group may have to terminate the employment or term of office of any Participant;

	(d)
	may
be used to increase damages in any action brought against any body corporate in the Group in respect of any such termination; or

	(e)
	confers
on an Employee or Non-Executive Director any expectation to become a Participant. 

No claim by Participant  

	21.2
	A
Participant will not have any claim against the Trustee or the Bank as a result of the exercise by the Trustee of a power, discretion or determination or the performance by the
Trustee of an obligation, duty or responsibility under this Deed in relation to Shares allocated to the Participant's Account after the date of execution of the supplemental deed which added this
clause. 

22        Termination of Trust  

	22.1
	The
Trust will terminate and be wound up as provided below upon the first to occur of the following events:

	(a)
	an
order being made or an effective resolution being passed for the winding up of the Bank (other than for the purpose of amalgamation or reconstruction);

	(b)
	the
Board determining that the Trust is to be wound up; and

	(c)
	the
day before the 80th anniversary of the date of the Trust Deed. 

	22.2
	If
the Trust is terminated, the Trustee must transfer to the Participant:

	(a)
	the
Loan Shares standing to the credit of the Account of the Participant, upon the repayment in full by the Participant to the Bank of all Related Loans; and 

 

	(b)
	the
Non-Loan Shares standing to the credit of the Account of the Participating Employee; and

	(c)
	the
NED Shares standing to the credit of the Account of the Participating Director; and

	(d)
	the
Equity Shares standing to the credit of the Account of the Participating Employee. 

	22.3
	If
a Participant has not repaid the outstanding amount of all such Related Loans (if any) within 30 days of being asked to do so following the termination of the Trust then,
in relation to the Loan Shares standing to the credit of the Account of the Participant, the Trustee may on behalf of the Participant, sell the Loan Shares standing to the credit of the Account of the
Participant.

	22.4
	If
the Trustee sells Loan Shares in accordance with clause 22.3, the proceeds of sale will be applied in the following order:

	(a)
	in
payment of any costs and expenses of the sale incurred by the Trustee; and

	(b)
	in
reduction of the outstanding amount of the Related Loans; and

	(c)
	the
balance (if any) in payment to the Participant. 

	22.5
	Any
amount of a Loan to the Participant which remains outstanding after the application of the proceeds of sale of the Shares in accordance with clause 22.4 must be forgiven
by the Bank, and the Participant will have no further liability to the Bank in relation to that Loan.

	22.6
	The
balance of the capital or income of the Trust to which no Participant is entitled in accordance with clause 22.2 or clause 22.4 may be applied in whole or in part
for the benefit of one or more of the following beneficiaries as the Trustee thinks fit:

	(a)
	a
provident, benefit, superannuation or retirement fund established and maintained by the Bank; or

	(b)
	any
charity nominated by the Trustee. 

23        Governing law, Jurisdiction and Process  

	23.1
	This
Deed will be governed by the laws of Victoria and will be construed and take effect in accordance with those laws. 

EXECUTED as a deed 

  

 
 

EXECUTION PAGE    
  

	 
	 
	 

	THE COMMON SEAL of NATIONAL AUSTRALIA BANK LIMITED is affixed in accordance with its articles of association in the presence of:	}	 
	

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	Signature of authorised person	 	Signature of authorised person
	

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	Office held	 	Office held
	

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	Name of authorised person (block letters)	 	Name of authorised person (block letters)
	

 	

    	

 
	THE COMMON SEAL of NATIONAL AUSTRALIA TRUSTEES LIMITED is affixed in accordance with its articles of association in the presence of:	}	    
	

...................................................................................	

 	

.........................................................................................................
	Signature of authorised person	 	Signature of authorised person
	

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	Office held	 	Office held
	

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	Name of authorised person (block letters)	 	Name of authorised person (block letters)

  

 
 

National Australia Bank Staff
  Share Ownership Plan—
  Loan Scheme    
  

 
 

Rules    
  

(Consolidated: as amended by Board

Resolution on 26-27 August 1998)  

 Mallesons Stephen Jaques  

Rialto

525 Collins Street

Melbourne Vic 3000

Telephone (61 3) 9643 4000

Fax (61 3) 9643 5999

DX 101 Melbourne

Ref: JCT/APC 

 
 

CONTENTS    
  

 
  National Australia Bank Staff Share Ownership Plan—Loan Scheme Rules    
  

	1	Interpretation	 	 
	
2	

Application for Loan	
 	
 
	 	Invitation to apply for Loan	 	 
	 	Application for Loan	 	 
	 	Payment authority	 	 
	
3	

Amount of Loan	
 	
 
	 	Loan Amount	 	 
	 	Maximum Loans	 	 
	
3A	

Segments	
 	
 
	
4	

Use of Loan	
 	
 
	 	Application of Loans	 	 
	 	Loans only for Staff Share Plan	 	 
	 	Application of proceeds of Loans	 	 
	 	Rights of Bank—Shares	 	 
	
5	

Interest on a Loan	
 	
 
	 	Loans initially interest free	 	 
	 	Interest after Loan due for repayment	 	 
	 	Interest Rate	 	 
	 	Post-Judgment Interest	 	 
	
6	

Repayments from Dividends	
 	
 
	 	Repayment with Cash Dividends	 	 
	 	No participation in bonus plans or DRP	 	 
	
7	

Sale of Loan Shares	
 	
 
	 	Application of sale proceeds	 	 
	 	Balance to Participant	 	 
	 	Shortfall	 	 
	
8	

Repayment of Loan and Revision of Loan Terms	
 	
 
	 	When Full Recourse Segment is repayable	 	 
	 	Whole Loan repayable	 	 
	 	Repayment from termination payments	 	 
	 	Early repayment	 	 
	 	Unauthorised disposal of Shares	 	 
	
9	

Administration of the Scheme	
 	
 
	
10	

Rights of Participants	
 	
 
	
11	

Amendment of these Rules	
 	
 
	
12	

Notices	
 	
 
	
13	

General	
 	
 
	
14	

Governing Law	
 	
 

  

NATIONAL AUSTRALIA BANK LIMITED

(ABN 12 004 044 937)  

 
  National Australia Bank Staff Share Ownership Plan—Loan Scheme
  
    Rules    
  

            The following are the rules of the National Australia Bank Staff Share Ownership Plan Loan Scheme. 

1          Interpretation  

	1.1
	In
these rules the following words have these meanings unless the contrary intention appears. 

            Bank means National Australia Bank Limited. 

            Board means all or some of the Directors acting as a board. 

            Bonus Share has the same meaning as the expression "Bonus Share" in the Trust Deed. 

            Cash Dividend means a dividend declared or paid with respect to Shares which is payable wholly in cash or, in the case of a dividend
declared or paid with respect to Shares which is payable only partly in cash, that part of the dividend which is payable in cash. 

            Director means director of the Bank. 

            Employee means a permanent full or part time employee of a body corporate in the Group (including a director of a body corporate in the
Group who holds on a permanent full time or part time basis salaried employment in a body corporate which is in the Group). 

            Full Recourse Segment means, where a Loan is provided in Segments, that part of the Loan designated by the Board to be the Full Recourse
Segment. 

            Group means the Bank and each body corporate that is a subsidiary of the Bank under Division 6 of Part 1.2 of the Corporations
Law. 

            Limited Recourse Segment means, where a Loan is provided in Segments, that part of the Loan designated by the Board to be the Limited
Recourse Segment. 

            Loan means a loan made by the Bank to an Employee under this Scheme. 

            Loan Share means: 

	(a)
	a
Share the acquisition of which under the Staff Share Plan has been funded by a loan made under this Scheme; and

	(b)
	a
Bonus Share deemed to be a Loan Share by virtue of clause 6.6(b) of the Trust Deed. 

            Participant means a person to whom a Loan is made. 

            Related Loan means, in relation to a Loan Share, the Loan under this Scheme which funded the acquisition of the Loan Share or in the case
of a Loan Share which is a Bonus Share, the Loan Share in respect of which the Bonus Share was issued or deemed under the Trust Deed to be issued. 

            Scheme means the National Australia Bank Staff Share Ownership Plan—Loan Scheme as varied from time to time. 

            Segments means in respect of a Loan, the Full Recourse Segment or the Limited Recourse Segment of the Loan.

 

            Shares means: 

	(a)
	an
ordinary share in the capital of the Bank;

	(b)
	where
the Board's approval is obtained in accordance with the Staff Share Plan, shares in the capital of the Bank represented by American Depository Receipts purchased by the Trustee. 

            Share means an ordinary share in the capital of the Bank. 

            Staff Share Plan means the National Australia Bank Staff Share Ownership Plan as varied from time to time. 

            Trustee means the trustee appointed under the Trust Deed. 

            Trust Deed means the trust deed of the Staff Share Plan. 

	1.2
	In
these rules, unless the contrary intention appears:

	(a)
	the
singular includes the plural and vice versa;

	(b)
	a
reference to a related body corporate of the Bank is a reference to a body corporate which is so related within the meaning of the Corporations Law; and

	(c)
	a
reference to a person includes a reference to the person's legal personal representatives, executors, administrators and successors, a firm or a body corporate. 

	1.3
	Headings
are for convenience and do not affect the interpretation of these rules. 

2          Application for Loan  

Invitation to apply for Loan  

	2.1
	At
or about the time that an Employee is invited to purchase or subscribe for Shares under the Staff Share Plan, the Board may invite the Employee to apply for a Loan for the purposes
of funding in whole or, if the Board so permits, in part the subscription or acquisition by the Employee of Shares under the Staff Share Plan. 

Application for Loan  

	2.2
	An
application for a Loan shall be in the form prescribed by the Board from time to time and must be made solely by the Employee and in the name of the Employee. 

Payment authority  

	2.3
	Each
Participant irrevocably authorises the Bank to pay directly to the Trustee the amount of the Loan to that Participant which the Trustee must apply to purchase or subscribe for
Shares on the Participant's behalf. 

3          Amount of Loan  

Loan Amount  

	3.1
	Subject
to rule 3.2, the maximum amount of a Loan for which an Employee may apply under this Scheme is:

	(a)
	the
amount determined by the Board in respect of that Employee or in respect of Employees of a particular classification; or 

 

	(b)
	an
amount equal to the aggregate issue price or acquisition price (as the case may be) of Shares which, at or about the time of the Participant applies for the Loan, are offered to
the Employee under the Staff Share Plan and for which the Employee applies 

            whichever
is less. 

Maximum Loans  

	3.2
	An
Employee may only apply for a Loan under this Scheme if the aggregate of:

	(a)
	the
principal amount of the Loan for which application is made; and

	(b)
	the
aggregate principal amount of all other outstanding Loans to the Employee under this Scheme, 

            does
not exceed an amount determined from time to time by the Board in respect of Employees in that classification. 

3A      Segments  

	3A.1
	The
Board may determine with respect to any Loan or class of Loans that part of the principal amount of the Loan (the "Full Recourse
Segment") is to be provided on a full recourse basis and to be repayable as set out in clause 8.1 to 8.5 (inclusive) and the balance of the principal amount of the Loan
(the "Limited Recourse Segment") is to be provided with limited recourse as contemplated in clause 7.3 and to be repayable as set out in
clause 8.2 to 8.5 (inclusive). The Full Recourse Segment and the Limited Recourse Segment of any Loan together form the Loan and (for the avoidance of doubt) a reference in these Rules to the
Loan or the principal amount of the Loan includes a reference to the Segments and the principal amount thereof.

	3A.2
	Where
under these Rules any amount is to be applied in repayment of a Loan (or Related Loan) or payment of any interest thereon or any other amount in respect thereof and the Loan
(or Related Loan) is provided in Segments the amount may be applied in the discretion of the Bank:

	(a)
	where
it is a payment of interest, first in payment of interest on the Full Recourse Segment and secondly, in payment of interest on the Limited Recourse Segment;

	(b)
	where
it is to be applied in payment or repayment of any other amount in respect of the Loan (or Related Loan), first in payment or repayment of such amounts in respect of the Full
Recourse Segment and thereafter in payment or repayment of such amounts in respect of the Limited Recourse Segment. 

4          Use of Loan  

Application of Loans  

	4.1
	If
application for a Loan pursuant to rule 2 is accepted by the Bank, the entire amount of the Loan must be applied in or towards paying in full on subscription for or purchase
of the Shares which, at or about the time the Loan is made, are subscribed for or purchased by the Trustee on behalf of the Employee under the Staff Share Plan. 

Loans only for Staff Share Plan  

	4.2
	No
proceeds of a Loan may be applied towards subscribing for purchasing a Share other than under the Staff Share Plan. 

 

Application of proceeds of Loans  

	4.3
	The
proceeds of a Loan will be applied by the Trustee on behalf of the Employee in the manner outlined in rule 4.1 and in accordance with the Trust Deed. 

Rights of Bank—Shares  

	4.4
	Nothing
in these Rules confers or is intended to confer on the Bank any charge, lien or other proprietary right or proprietary interest in the Shares. The rights of the Bank under
these Rules are purely contractual. 

5          Interest on a Loan  

Loans initially interest free  

	5.1
	Subject
to rules 5.2 and 8.5 the principal amount outstanding under a Loan will be interest free unless the Board decides otherwise. 

Interest after Loan due for repayment  

	5.2
	A
Participant must pay interest on the daily balance of the principal amount outstanding under a Loan (or part of a Loan) from when the Loan (or that part of the Loan) becomes due for
repayment during the period that it remains unpaid. 

Interest Rate  

	5.3
	The
rate of interest payable pursuant to rule 5.2 is a rate per annum equal to the Bank's Base Lending Rate from time to time (or any rate which in the opinion of the Board
replaces that rate) plus a margin of such percentage as is determined by the Board from time to time or such other rate as the Board determines. Unless the Board decides otherwise, interest will
accrue from day to day and may be capitalised by the Bank on the first day of each month. Interest is payable on capitalised interest at the rate referred to in rule 5.3. 

Post-Judgment Interest  

	5.4
	If
a liability in respect of a Loan becomes merged in a judgment or order a Participant must pay interest on the amount of that liability as an independent obligation. This interest
accrues from the date the liability becomes due for payment both before and after the judgment or order until it is paid at a rate that is the higher of the rate payable under the judgment or order
and the rate referred to in Rule 5.3. 

6          Repayments from Dividends  

Repayment with Cash Dividends  

	6.1
	The
proportion of all Cash Dividends which are paid in respect of a Loan Share and which the Participant has directed the Trustee to apply in repayment of the Loan must be applied by
the Trustee on behalf of the Participant for whom the Trustee holds that Loan Share in repaying the principal amount outstanding under the Related Loan and any interest in respect of that Related
Loan. 

No participation in bonus plans or DRP  

	6.2
	By
participating in this Scheme the Participant acknowledges that the Trustee will not participate in the Bank's Bonus Share Plan, Dividend Reinvestment Plan or UK Dividend Plan in
respect of a Loan Share. 

 

7          Sale of Loan Shares  

Application of sale proceeds  

	7.1
	If
the Trustee sells Loan Shares under the Trust Deed, the proceeds of sale of the Loan Shares (after deducting the costs of sale including, without limitation, any brokerage, taxes
and duties) must be applied by the Trustee towards paying any amounts outstanding in relation to the Related Loan. 

Balance to Participant  

	7.2
	After
applying the net proceeds of sale of Loan Shares in the manner outlined in rule 7.1, the Trustee must pay to the Participant the balance (if any) of such proceeds. 

Shortfall  

	7.3
	If
the proceeds of sale of Loan Shares are less than the amount outstanding in relation to the Related Loan:

	(a)
	where
the Loan is not provided in Segments, the Bank will forgive the amount of the shortfall of the Related Loan (including principal, interest and all other amounts owing in respect
of it); and

	(b)
	where
the Loan is provided in Segments, the Bank will forgive the amount of the shortfall of the Limited Recourse Segment of the Related Loan (including principal, interest and all
other amounts owing in respect of the Limited Recourse Segment). 

            Nothing
in this clause requires the Bank to forgive the Full Recourse Segment in respect of a Related Loan or interest or other amounts owing in respect of it. 

8          Repayment of Loan and Revision of Loan Terms  

When Full Recourse Segment is repayable  

	8.1
	If
a Loan is provided in Segments, unless the Board otherwise determines, the principal amount outstanding under the Full Recourse Segment shall be payable in ten equal instalments
(or such other number as the Board may determine) on the date salary or wages is payable to the relevant Participant. To the extent such an authority is not unlawful or in breach of an applicable
award, each Participant authorises and directs the Bank (or if the Participant is employed by a member of the Group other than the Bank, will authorise and direct that member) to deduct the amount of
any instalment payable by the Participant from the Participant's salary or wages and pay such money to the Bank. 

Whole Loan repayable  

	8.2
	The
whole of the principal amount outstanding under a Loan (and any interest which has accrued and is unpaid) will become immediately due and payable upon the earliest to occur of:

	(a)
	the
20th anniversary of the date on which the Loan was made; and

	(b)
	the
Participant becoming an insolvent under administration as defined in section 9 of the Corporations Law. 

Repayment from termination payments  

	8.3
	By
participating in this Scheme the Participant agrees and directs (to the extent such an agreement is not unlawful or in breach of an applicable award) that if the Participant ceases
to 

 

be
an Employee for any reason (including death), any amounts (other than amounts relating to superannuation entitlements) payable to the Participant by any body corporate in the Group in relation to
the cessation of his or her employment (including, without limitation, wages, salary, employee allowances and loadings, annual leave entitlements and long service leave entitlements) may (at the
discretion of the Board) be applied towards paying all amounts outstanding in relation to any Loan and that any remaining balance of such moneys (after any other application authorised by the
Participant) shall then be paid to the Participant or as may be otherwise required. 

Early repayment  

	8.4
	A
Participant may elect to repay the whole or any of the principal amount outstanding under a Loan at any time. 

Unauthorised disposal of Shares  

	8.5
	If
a Participant disposes (other than in accordance with rule 7) of the legal or beneficial interest in any Loan Share whilst any amount remains outstanding in respect of the
Related Loan the following provisions apply:

	(a)
	the
Board may elect to give the Participant a notice requiring repayment of the Related Loan whereupon the whole of the principal amount outstanding under the Related Loan (and any
interest which has accrued and is unpaid) becomes immediately due and payable and for the purpose of rule 5.2 the whole of the principal amount outstanding under the Related Loan is regarded as
having become due for repayment on the date of disposal of the Loan Share; or

	(b)
	the
Board may elect to give notice to the Participant of revised terms (including, without limitation) as to interest and repayment, which are to apply to the Related Loan determined
(at the discretion of the Board) by reference to terms upon which the Bank makes instalment loans to non-corporate customers. If the Participant accepts in writing the revised terms within
14 days of receiving them, the Related Loan continues (from and including the date of disposal of the Loan Share) on the basis of those revised terms. If the Participant does not accept in
writing the revised terms within 14 days of receiving them, the outstanding balance of the Related Loan, at the end of that 14 day period, becomes immediately due and payable and, for
the purpose of rule 5.2, the outstanding balance of the Related Loan is regarded as having become due for repayment on the date of disposal of the Loan Share. 

9          Administration of the Scheme  

	9.1
	The
Scheme will be administered by the Board in accordance with these rules. The Board may make regulations for the operation of the Scheme which are consistent with these rules.

	9.2
	Any
power or discretion which is conferred on the Board by these rules must be exercised by the Board in the interests or for the benefit of the Bank, and the Board is not, in
exercising any such power or discretion, under any fiduciary or other obligation to any other person.

	9.3
	Any
power or discretion which is conferred on the Board by these Rules may be delegated by the Board to a committee consisting of such Directors and/or officers and/or employees of
the Bank or a related body corporate of the Bank as the Board thinks fit.

	9.4
	The
decision of the Board as to the interpretation, effect or application of these Rules will be final and conclusive. 

 

	9.5
	The
Board may from time to time suspend the operation of the Scheme and may at any time cancel the Scheme without prejudice to the rights of Participants. 

10        Rights of Participants  

	10.1
	Nothing
in these rules:

	(a)
	confers
on any Employee the right to receive a Loan;

	(b)
	confers
on any Participant the right to continue as an Employee of any body corporate in the Group;

	(c)
	affects
any rights which any body corporate in the Group may have to terminate the employment of any Employee

	(d)
	may
be used to increase damages in any action brought against any body corporate in the Group in respect of any such termination; or

	(e)
	confers
on an Employee any expectation to become a Participant. 

11        Amendment of these Rules  

	11.1
	Subject
to rules 11.2 and 11.3, the Bank may at any time by written instrument or by resolution of the Board, amend all or any of the provisions of these rules (including this
rule 11).

	11.2
	No
amendment of the provisions of these rules is to reduce the rights of any Participant in respect of a Loan made under this Scheme prior to the date of the amendment, other than an
amendment introduced primarily:

	(a)
	for
the purpose of complying with or conforming to present or future State, Territory or Commonwealth legal requirements governing or regulating the maintenance or operation of the
Scheme or like schemes;

	(b)
	to
correct any manifest error or mistake;

	(c)
	to
enable contributions or other amounts paid by any body corporate in the Group in respect of the Scheme to qualify as income tax deductions for the body corporate or any other body
corporate in the Group;

	(d)
	to
enable the Participant or their employer to reduce the amount of fringe benefits tax under the Fringe Benefits Tax Assessment Act 1986, the amount of tax under the Income Tax
Assessment Act 1936 or the amount of any other tax or impost that may otherwise be payable by the Participant or their employer in relation to the Scheme;

	(e)
	for
the purpose of enabling the Participants generally (but not necessarily each Participant) to receive a more favourable taxation treatment in respect of their participation in the
Scheme; or

	(f)
	to
enable any body corporate in the Group to comply with the Corporations Law or the Listing Rules. 

	11.3
	No
amendment may be made except in accordance with and in the manner stipulated (if any) by the Listing Rules.

	11.4
	Subject
to the above provisions of this rule 11, any amendment made pursuant to rule 11.1 may be given such retrospective effect as is specified in the written
instrument or resolution by which the amendment is made. 

 

12        Notices  

	12.1
	Any
notice regarding Loans granted under the Scheme will be sent to the address of the Participant as notified to the Bank from time to time by the Participant. 

13        General  

	13.1
	Unless
the Directors otherwise determine, payments made in respect of a Loan will be applied first towards payment of interest (if any) and secondly towards payment of principal.

	13.2
	Where
the Bank advances a Loan in a currency (whether Australian Dollars or United States Dollars) all payments in respect of the Loan shall be made in that currency. If an amount is
due in one currency and the Bank receives payment in another currency, the Bank may convert the amount received into the due currency at the spot rate at which the Bank is able to purchase the due
currency with the amount received. The Participant satisfies its obligation to pay in the due currency only to the extent of the amount of the due currency purchased after deducting the costs of
conversion. The Participant acknowledges that it may be necessary for the Bank to convert amounts received through a currency other than the due currency to ascertain the equivalent in the due
currency of the amount received. 

14        Governing Law  

	14.1
	The
Scheme is governed by and shall be construed and take effect in accordance with the laws of Victoria. 

QuickLinks

EXHIBIT 4.2

National Australia Bank Staff Share Ownership Plan

Trust Deed

CONTENTS

National Australia Bank Staff Share Ownership Plan Trust Deed

TRUST DEED

EXECUTION PAGE

National Australia Bank Staff Share Ownership Plan— Loan Scheme

Rules

CONTENTS

National Australia Bank Staff Share Ownership Plan—Loan Scheme Rules

National Australia Bank Staff Share Ownership Plan—Loan Scheme RulesQuickLinks
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EXHIBIT 4.4    
  

             

  

 
 

National Australia Bank
  Executive Share Option
  Plan No. 2    
  

 
 

Rules    
  

(Consolidated to include amendments

to the 5% limit (clause 3.1) approved

by the Board in November 2002 and

removal of ability to exercise options

early in event of death and TPD (in

schedule 1) approved by the Board in

February 2003)  

 

 
 

CONTENTS    
  

 
 

National Australia Bank Executive Share Option Plan No. 2    
  

	1	Definitions and interpretation	 	 
	
2	

Grant of Options	
 	
 
	 	Eligibility	 	 
	 	Issue terms	 	 
	
3	

Maximum number of Options	
 	
 
	
4	

Option terms	
 	
 
	
5	

Overriding restrictions on issue and exercise	
 	
 
	
6	

Loans to Participants	
 	
 
	 	Application for Loan	 	 
	 	Amount of Loan	 	 
	 	Use of Loan	 	 
	 	Interest on a Loan	 	 
	 	Interest rate	 	 
	 	Repayment from Dividends	 	 
	 	Sale of Loan Shares	 	 
	 	Repayment of Loan	 	 
	
7	

Transfer of Shares	
 	
 
	 	Ten year restriction on transfer	 	 
	 	No transfer	 	 
	 	Entry on sub-register	 	 
	 	Segregation in sub-register	 	 
	 	Sale of Loan Shares	 	 
	
8	

Rights attaching to Loan Shares	
 	
 
	 	Dividends	 	 
	 	Bonus Shares	 	 
	 	Rights	 	 
	
9	

Administration of the Plan	
 	
 
	
10	

Rights of Participants	
 	
 
	
11	

Amendment of these Rules	
 	
 
	
12	

Notices	
 	
 
	
13	

Governing Law	
 	
 

NATIONAL AUSTRALIA BANK LIMITED

(ABN 12 004 044 937)  

 
  National Australia Bank Executive Share Option Plan No. 2
  
    Rules    
  

1          Definitions and interpretation  

	1.1
	In
these Rules (including in the Option terms in Schedule One), the following words and expressions have the meanings indicated unless the contrary intention appears: 

ASX means Australian Stock Exchange Limited. 

Bank means National Australia Bank Limited. 

Board means all or some of the Directors acting as a board. 

Bonus Share means the shares issued in respect of Loan Shares held by a Participant as part of a bonus issue to shareholders of the Bank. 

Cash Dividend means a dividend declared or paid with respect to Shares which is payable wholly in cash or, in the case of a dividend declared or paid
with respect to Shares which is payable only partly in cash, that part of the dividend which is payable in cash. 

Director means a director of the Bank. 

Executive means a person in the employment of a body corporate in the Group whom the Board determines to be in an executive position. 

Expiry Date means for an Option, a date not earlier than the day prior to the fifth anniversary of the date of issue of the Option and not later than
the tenth anniversary of the date of issue of the Option, as the Board determines. 

Former Executive means a person who was formerly an Executive. 

Group means the Bank and each body corporate that is a subsidiary of the Bank under Division 6 of Part 1.2 of the Corporations Law. 

Listing Rules means the Listing Rules of ASX. 

Loan means a loan from the Bank to a Participant under rule 6 for the purpose of acquiring a Share by the exercise of an Option. 

Loan Share means: 

	(a)
	a
Share acquired by the exercise of an Option where the exercise price is funded, in whole or part, with a Loan; and

	(b)
	a
Bonus Share which is deemed to be a Loan Share by virtue of clause 8.3. 

Loan Shareholder means the holder of a Loan Share. 

Market Price of a Share on a day means the weighted average of the prices at which Shares in that class were traded on the stock market of ASX during
the one week up to and including that day. 

Option means an option issued under the Plan to subscribe for Shares. 

Option Holder means the holder of an Option. 

Participant means an Option Holder or a Loan Shareholder who is an Executive or a Former Executive. 

Plan means the National Australia Bank Executive Share Option Plan No. 2.

Retirement in relation to a Participant means retirement by the Participant from employment of any body corporate in the Group at age 55 or over. 

Rights means any rights to acquire shares or securities issued or to be issued by the Bank. 

Rules means the rules of the Plan. 

Share means a fully paid ordinary share in the capital of the Bank. 

Share Registry means the share registry appointed from time to time by the Bank to administer its company sponsored sub-register of holders
of Loan Shares. 

	1.2
	In
these Rules unless the contrary intention appears:

	(a)
	the
singular includes the plural and vice versa;

	(b)
	reference
to a rule, a statute or other law includes regulations and other instruments under it and consolidations, amendments, re-enactments or replacements of any of
them; and

	(c)
	a
reference to a person includes a reference to the person's legal personal representatives, executors, administrators and successors, a firm or a body corporate. 

	1.3
	Headings
are inserted for convenience and do not affect the interpretation of these Rules. 

2          Grant of Options  

Eligibility  

	2.1
	The
Board may in its absolute discretion, without being bound to do so and subject to any approvals of shareholders of the Bank required by law or the Listing Rules, at intervals
determined by the Board, offer Options to Executives selected by the Board. 

Issue terms  

	2.2
	Options
must be granted on the terms of these Rules and each Participant will be taken to have agreed to be bound by these Rules on acceptance of any offer of Options. 

3          Maximum number of Options  

	3.1
	In
the case of an offer of Shares or options for issue, the number of Shares the subject of the offer or to be received on exercise of an option when aggregated with:

	(a)
	the
number of Shares in the same class which would be issued were each outstanding offer or option to acquire unissued Shares, being an offer made or option acquired pursuant to an
employee share scheme of the Bank extended only to employees or directors of the Bank and of associated bodies corporate of the Bank, to be accepted or exercised (as the case may be); and

	(b)
	the
number of Shares in the same class issued during the pervious 5 years pursuant to the Plan or any other employee share scheme of the Bank extended only to employees or
directors of the Bank and of associated bodies corporate of the Bank, 

but
disregarding any offer made, or option acquired or Share issued by way of or as a result of: 

	(c)
	an
offer to a person situated at the time of receipt of the offer outside Australia; or

	(d)
	an
offer that was an excluded offer or invitation within the meaning of the Corporations Law as it stood prior to the commencement of Schedule 1 to the Corporate Law Economic
Reform Program Act 1999; or

	(e)
	an
offer that did not need disclosure to investors because of section 708 of the Corporations Law; 

must
not exceed 5% of the total number of issued Shares in that class of the Bank as at the time of the offer. 

4          Option terms  

	4.1
	Options
must be issued on the terms set out in Schedule One:

	4.2
	Subject
to the Listing Rules, Options may be issued on further terms in addition to, but not inconsistent with, the terms in Schedule One, if the Board so determines either generally
or in relation to particular Options. 

5          Overriding restrictions on issue and exercise  

	5.1
	Notwithstanding
any Rule or the terms of any Option, no Option may be offered, issued or exercised if to do so:

	(a)
	would
contravene the Corporations Law or the Listing Rules; or

	(b)
	would
contravene the local laws or customs of Executive's country of residence or in the opinion of the Board would require actions to comply with those local laws or customs which
are impractical. 

6          Loans to Participants  

Application for Loan  

	6.1
	The
Board may invite an Option Holder who is an Executive to apply for a loan from the Bank under these rules for the purposes of funding in whole or in part the subscription by the
Option Holder of the Shares to be issued if the Option Holder exercises Options.

	6.2
	An
application for a Loan must:

	(a)
	be
in the form prescribed by the Board from time to time; and

	(b)
	be
made solely by the Option Holder and in the name of the Option Holder. 

Amount of Loan  

	6.3
	The
maximum amount of a Loan for which an Option Holder may apply is an amount equal to the aggregate issue price of the Shares to be issued on exercise of the Options. 

Use of Loan  

	6.4
	If
an application by an Option Holder who is an Executive for a Loan pursuant to rule 6.2 is accepted by the Board, the entire amount of the Loan must be applied in or towards
paying in full on subscription for Shares which, at or about the time the Loan is made, are subscribed for by the Option Holder under the Plan. The Bank may only make a Loan under these Rules to an
Option Holder who is an Executive.

	6.5
	The
proceeds of a Loan to an Option Holder must be applied by the Bank on behalf of the Option Holder in the manner outlined in rule 6.4. 

Interest on a Loan  

	6.6
	Unless
the Board determines otherwise, a Loan Shareholder must pay on each Loan made to that Loan Shareholder interest on the daily balance of the principal amount outstanding under
that Loan at the rate applicable to that Loan Shareholder under rule 6.7. 

Interest rate  

	6.7
	The
rate of interest applicable to a Loan Shareholder in relation to a Loan is:

	(a)
	if
that Loan has not become immediately due and payable under rule 6.17:

	(i)
	while
the Loan Shareholder remains an Executive the Bank's Base Lending Rate plus any margin determined by the Board;

	(ii)
	after
the Loan Shareholder has ceased to be an Executive the Bank's Base Lending Rate plus any margin determined by the Board; 

	(b)
	if
that Loan has become immediately due and payable under rule 6.17, the Bank's Base Lending Rate plus any margin determined by the Board; or

	(c)
	such
other rate as the Board determines. 

	6.8
	Unless
otherwise determined by the Board interest on a Loan:

	(a)
	accrues
from day to day;

	(b)
	is
payable monthly on the first day of each month; and

	(c)
	unless
paid by the Loan Shareholder, may at the option of the Bank be capitalised by the Bank on the first day of the month on which it falls due. 

	6.9
	Where
an amount of interest payable by a Loan Shareholder on a Loan is capitalised under rule 6.8(c), interest is payable on the amount so capitalised at the rate applicable
for the time being to that Loan Shareholder under rule 6.7. 

Repayment from Dividends  

	6.10
	Each
Cash Dividend which is payable in respect of a Loan Share is to be applied by the Bank on behalf of the Loan Shareholder who owns that Loan Share:

	(a)
	first,
in payment of any interest which is due in respect of the Loan in relation to that Loan Share;

	(b)
	secondly,
in repayment of the principal amount outstanding under that Loan. 

	6.11
	By
applying for a Loan under this Plan, a Loan Shareholder undertakes not to participate in the Bank's Bonus Share Plan, Dividend Reinvestment Plan or UK Dividend Plan in respect of
a Loan Share until all amounts outstanding in relation to the Loan taken out to acquire that Loan Share have been paid in full. 

Sale of Loan Shares  

	6.12
	A
Loan Shareholder who wishes to sell any Loan Shares must forward to the secretary of the Bank:

	(a)
	a
request (in the form prescribed by the Board from time to time) that the Bank, on behalf of the Participant, sell or arrange the sale of the Loan Shares; and

	(b)
	such
other documents as the Bank prescribes. 

	6.13
	The
Bank must sell the Loan Shares in accordance with the request referred to in rule 6.12. By participating in this Plan the Loan Shareholder agrees with the Bank that the
proceeds of sale of the Loan Shares (after deducting the costs of sale including, without limitation, any brokerage, taxes and duties) may be applied by the Bank towards paying any amounts outstanding
in relation to the Loan in relation to those Loan Shares.

	6.14
	After
applying the net proceeds of sale of Loan Shares in the manner outlined in rule 6.13, the Bank will pay to the Loan Shareholder the balance (if any) of such proceeds. 

Repayment of Loan  

	6.15
	The
whole of the principal amount outstanding under a Loan (and any interest which has accrued and is unpaid) will become immediately due and payable at the option of the Board upon
the earliest to occur of:

	(a)
	the
Loan Shareholder ceasing for any reason (including death) to be an Executive;

	(b)
	the
Loan Shareholder disposing of the legal or beneficial interest in any Loan Shares except in accordance with rule 6.12; and

	(c)
	the
Loan Shareholder becoming an insolvent under administration as defined in section 9 of the Corporations Law. 

	6.16
	By
participating in the Plan each Participant agrees and directs (to the extent such an agreement is not unlawful or in breach of an applicable award) that if the Participant ceases
to be an Executive for any reason (including death), any amounts (other than amounts relating to superannuation entitlements) payable to him or her by the Bank or any related body corporate of the
Bank in relation to the cessation of his or her employment (including, without limitation, wages, salary, employee allowances and loadings, annual leave entitlements and long service leave
entitlements) may (at the discretion of the Bank) be applied towards paying all amounts outstanding in relation to any Loan and that any remaining balance of such moneys (after any other application
authorised by the Participant) shall then be paid to the Participant or as may be otherwise required.

	6.17
	A
Loan Shareholder may elect to repay the whole or any of the principal amount outstanding under a Loan at any time. 

7          Transfer of Shares  

	7.1
	This
rule 7 applies to a Loan Share held by a Loan Shareholder. 

Ten year restriction on transfer  

	7.2
	A
Loan Shareholder may not transfer or deal in a Loan Share prior to the expiration of ten years after the date on which the Option (pursuant to which the Share was allotted) was
acquired by the Loan Shareholder except in the circumstances set out in this rule 7 or unless compelled by law.

	7.3
	If
no amount remains outstanding on the Loan, the Loan Shareholder may, at any time, transfer or deal in the Loan Shares to which the Loan relates. 

No transfer  

	7.4
	The
Bank must not register or permit the Share Registry to register a transfer of Loan Shares until the Loan in relation to the Loan Shares has been repaid. 

Entry on sub-register  

	7.5
	On
issue of Loan Shares, the Bank must enter the Loan Shares on the Australian company-sponsored sub-register of holders of Loan Shares and the Loan Shares must remain
entered in the Company-sponsored sub-register until the Loan in relation to the Loan Share is repaid. 

Segregation in sub-register  

	7.6
	The
Bank must instruct the Share Registry to segregate the Loan Shares in the sub-register and to record in the sub-register that the Shares are Loan Shares
until the Loan in relation to the Loan Shares is repaid. 

Sale of Loan Shares  

	7.7
	A
Loan Shareholder may require the Bank to sell the Loan Shares as agent of the Loan Shareholder in accordance with rule 6.12 and rule 6.13. 

8          Rights attaching to Loan Shares  

Dividends  

	8.1
	The
Loan Shareholder agrees and directs that the Bank may apply each Cash Dividend on Loan Shares under rule 6.10 on behalf of the Loan Shareholder in reduction of the Loan in
relation to the Loan Shares made to the Loan Shareholder. 

Bonus Shares  

	8.2
	A
Loan Shareholder is entitled to any Bonus Shares which accrue to Loan Shares held by the Loan Shareholder.

	8.3
	Upon
allotment to the Loan Shareholder,

	(a)
	the
Bonus Shares will for the purposes of the Plan be treated as allotted to the Loan Shareholder at a time determined by the Board; and

	(b)
	the
Bonus Shares are deemed to be Loan Shares for the purposes of this Plan. 

	8.4
	The
Bonus Shares are to be registered in the name of the Loan Shareholder. 

Rights  

	8.5
	Any
Rights which accrue to Loan Shares acquired by the Loan Shareholder may be sold by the Loan Shareholder.

	8.6
	The
Loan Shareholder must pay the proceeds of sale of such Rights or such proportion of the proceeds of sale as the Board determines to the Bank. The Bank must apply the proceeds of
sale, or the proportion of those proceeds, in reduction of the Loan made by the Bank to the Loan Shareholder in relation to the Loan Shares. 

9          Administration of the Plan  

	9.1
	The
Plan will be administered by the Board in accordance with these Rules. The Board may make further rules for the operation of the Plan which are consistent with these Rules.

	9.2
	Any
power or discretion which is conferred on the Board by these Rules must be exercised by the Board in the interests or for the benefit of the Bank, and the Board is not, in
exercising any such power or discretion, under any fiduciary or other obligation to any other person.

	9.3
	Any
power or discretion which is conferred on the Board by these Rules may be delegated by the Board to a committee consisting of such Directors and/or other officers and/or employees
of the Bank as the Board thinks fit.

	9.4
	The
decision of the Board as to the interpretation, effect or application of these Rules will be final and conclusive.

	9.5
	The
Board may from time to time suspend the operation of the Plan and may at any time cancel the Plan. The suspension or cancellation of the Plan will not prejudice the existing
rights of Participants. 

10        Rights of Participants  

            Except as expressly provided in these Rules, nothing in these Rules: 

	(a)
	confers
on any Executive the right to receive any Options;

	(b)
	confers
on any Participant the right to continue as an employee of the Bank or any of its subsidiaries;

	(c)
	affects
any rights which the Bank or a subsidiary may have to terminate the employment of any employee;

	(d)
	may
be used to increase damages in any action brought against the Bank or a subsidiary in respect of any such termination; or

	(e)
	confers
on an Executive any expectation to become a Participant. 

11        Amendment of these Rules  

	11.1
	Subject
to rules 11.2 and 11.3, the Bank may at any time by written instrument or by resolution of the Board, amend all or any of the provisions of this these Rules (including
this rule 11).

	11.2
	No
amendment of the provisions of these Rules is to reduce the rights of any Participant in respect of Options granted, Loans made or Loan Shares issued under the Plan prior to the
date of the amendment, other than an amendment introduced primarily:

	(a)
	for
the purpose of complying with or conforming to present or future State, Territory or Commonwealth legal requirements governing or regulating the maintenance or operation of the
Plan or like plans;

	(b)
	to
correct any manifest error or mistake; 

	(c)
	to
enable contributions or other amounts paid by any body corporate in the Group in respect of the Plan to qualify as income tax deductions for that body corporate the company or any
other body corporate within the Group;

	(d)
	to
enable the Participant or their employer to reduce the amount of fringe benefits tax under the Fringe Benefits Tax Assessment Act 1986, the amount of tax under the Income Tax
Assessment Act 1936 or the amount of any other tax or impost that may otherwise be payable by the Participant or their employer in relation to the Plan;

	(e)
	for
the purpose of enabling Participants generally (but not necessarily each Participant) to receive a more favourable taxation treatment in respect of their participation in the
Plan; or

	(f)
	to
enable any body corporate in the Group to comply with the Corporations Law or the Listing Rules. 

	11.3
	No
amendment may be made except in accordance with and in the manner stipulated (if any) by the Listing Rules.

	11.4
	No
amendment may be made to extend the period during which an Option may be exercised.

	11.5
	Subject
to the above provisions of this rule 11, any amendment made pursuant to rule 11.1 may be given such retrospective effect as is specified in the written
instrument or resolution by which the amendment is made and, if so stated, amendments to these Rules, including the terms of Options, have the effect of automatically amending the terms of issued but
unexercised options. 

12        Notices  

	12.1
	Any
notice regarding Options granted under the Plan will be sent to the registered address of the Option Holder as recorded in the register of Option Holders maintained by the Bank. 

13        Governing Law  

	13.1
	The
Plan is governed by and shall be construed and take effect in accordance with the laws of Victoria. 

 
 

SCHEDULE ONE: OPTION TERMS    
  

1          Entitlement  

	1.1
	Subject
to Option Term 7, each Option entitles the holder to subscribe for and be allotted, credited as fully paid, one Share at an exercise price per Share of the greater of the par
value (if Shares are permitted to have a par value) and the Market Price of a Share on the date of issue of the Option.

	1.2
	Subject
to the Listing Rules, the Bank must allot Shares on exercise of an Option in accordance with the Rules.

	1.3
	Unless
the Option Terms provide otherwise, Shares issued on the exercise of Options will rank pari passu with all existing Shares from
the date of issue and will be entitled in full to those dividends which have a record date for determining entitlements after the date of issue. 

2          Conditions for exercise of Options  

	2.1
	The
Board may impose such conditions upon the exercise of Options as it considers appropriate and these conditions must be notified to the Executive at the time of the offer. Without
in any way limiting the Board's discretion in this regard, the conditions of exercise may include conditions relating to:

	(a)
	the
profitability of the Bank;

	(b)
	the
price at which the Bank's shares are traded on a stock market of ASX or any other stock exchange; and

	(c)
	limits
on the number or proportion of the Options that may be exercised in any one or more time periods. 

	2.2
	An
Option may be exercised:

	(a)
	subject
to any conditions imposed by the Board under Term 2.1, at any time after the expiration of three years from the date of grant of the Option and on or before the Expiry Date of
the Option, unless the Option lapses under Term 2.3; or

	(b)
	if
the Board gives notice to a Participant under Term 3; or

	(c)
	if
the Board so determines. 

	2.3
	An
Option not exercised will lapse on the first to occur of:

	(a)
	the
Expiry Date of the Option;

	(b)
	30 days
after an Executive ceases to be employed by the Group, unless the Board otherwise determines; and

	(c)
	notice
from the Participant that the Participant wishes the Option to lapse. 

3          Notice to Participant  

	3.1
	The
Board may give a notice to an Option Holder for the purposes of Term 2.2(b) if:

	(a)
	a
takeover offer or announcement is made to the holders of Shares (other than as a result of an allotment approved by the Board).

	(b)
	a
statement is lodged with the ASX to the effect that a person has become entitled to not less than 15% of the Shares (other than as a result of an allotment approved by the Board);

	(c)
	pursuant
to an application made to the Court, the Court orders a meeting to be held in relation to a proposed compromise or arrangement for the purpose of or in connection 

with
a scheme for the reconstruction of the Bank or its amalgamation with any other companies; 

	(d)
	the
Bank passes a resolution for voluntary winding up; or

	(e)
	an
order is made for the compulsory winding up of the Bank. 

4          Method of exercise of Options  

	4.1
	An
Option is exercised by the holder lodging the notice of exercise of Option and application for Shares, together with the exercise price for each Share to be issued on exercise and
the relevant Option certificate, with the Company Secretary of the Bank or such other person as the Board designates.

	4.2
	Options
must be exercised in multiples of 100, unless the Option Holder exercises all Options able to be exercised at that time. The exercise of some Options only does not affect the
Option Holder's right to exercise other Options at a later time. If the Option Holder exercises less than all Options represented by a certificate then the Bank will cancel the certificate and issue a
new certificate for the balance. 

5          No Transfers  

            Options may not be transferred. 

6          Quotation of Options and Shares  

            Options will not be quoted on ASX. The Bank will make application to ASX for official quotation of Shares issued on the exercise of Options, if other Shares of
the Bank are listed at that time, as soon as practicable after the Shares are issued. 

7          Participation in future issues  

7.1      Participation generally

            A
Participant may only participate in new issues of securities to holders of Shares if the Option has been exercised, if that is permitted by its terms, and the shares in respect of the
Option have been allotted before the record date for determining entitlements to the issue. 

7.2      Bonus issues

            If
the Bank makes a bonus issue of shares or other securities pro rata to holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend
reinvestment) and no Shares have been allotted in respect of an Option before the record date for determining entitlements to the bonus issue then the rights attaching to that Option will be altered
as follows: 

	(i)
	the
number of Shares which the Option Holder is entitled to subscribe for on exercise of the Option (S) is determined by the formula: 

S =
N + (N × R) 

	(ii)
	the
exercise price per Share of an Option is the greater of the par value (if any) of the Share and the sum (EP) determined by the formula: 

	 
	 
	 
	 	 

	 	EP =	N × OP
 N + (N × R)	 	 

(fractions
are to be rounded up to the nearest cent)

where:

	 
	 

	N =	The number of Shares per Option which the Participant is entitled to subscribe for on the record date to determine entitlements to the bonus issue.
	

R =	

The number of Shares (including fractions) offered under the bonus issue for each Share held.
	

OP =	

The exercise price per Share on exercise of the Option which applies on the record date to determine entitlements to the bonus issue.

7.3      Rights issues

            If
the Bank makes an offer of ordinary shares pro rata to all or substantially all holders of Shares (other than an issue in lieu or in satisfaction of dividends or by way of dividend
reinvestment) for a
subscription price which is less than the market price (defined below as P) and no Shares have been allotted in respect of an Option before the record date for determining entitlements to the
rights issue then the exercise price per Option will be reduced by an amount (R) determined by the formula: 

	 
	 
	 
	 	 

	 	R =	E [P–(S + D)]
N + 1	 	 

(fractions
are to be rounded up to the nearest cent) 

where:

	 
	 

	E =	The number of Shares an Option Holder is entitled to subscribe for on exercise of one Option.
	

P =	

The weighted average market price of fully paid ordinary Shares sold in the ordinary course of trading on ASX during the five trading days ending on the day before the ex rights date.
	

S =	

The subscription price of new share issued under the rights issue.
	

D =	

Any dividends due but not yet paid on existing Shares which will not be payable in respect of new Shares issued under the rights issue.
	

N =	

Number of cum rights Shares required to be held to receive a right to one new Share.

            The
exercise price per Share cannot be reduced below the par value (if any) of the Share. 

            The
number of Shares which the participant is entitled to subscribe for on exercise of the Option will not change. 

7.4      Aggregation

            If
Options are exercised simultaneously then the Option Holder may aggregate the number of shares or fractions of shares or other securities to which the Option Holder is entitled to
subscribe under those Options. Fractions in the aggregate number only will be disregarded in determining the total entitlement to subscribe. 

7.5      Reconstruction

            In
the event of any reconstruction of the issued ordinary capital of the Bank the number of shares attaching to each Option or the exercise price per Share of an Option or both will be
reconstructed in the manner specified below. If the manner is not specified then the Board will determine the reconstruction. In any event the reconstruction will not result in any additional benefits
being conferred on Option Holders which are not conferred on shareholders of the Bank (subject to the same provisions with respect to rounding of entitlements as sanctioned by the meeting of
shareholders approving the reconstruction of capital) and in all other respects the terms for the exercise of Options will remain unchanged.

            In
the event of any consolidation or sub-division of shares or reduction or cancellation of capital then the reconstruction will be determined by the following formulae: 

	(a)
	Consolidation;
and

	(b)
	Subdivision: 

	 
	 
	 
	 	 

	 	S = C ×	B
 A	 	;

	 
	 
	 
	 	 

	 	EP = D ×	A
 B	 	 

	(c)
	Reduction
of capital by return of share capital: 

S =
C; 

	EP
	=  D
 less the amount per fully paid ordinary share returned to a Shareholder. 

	(d)
	Reduction
of capital by cancellation of ordinary shares that is either lost or not represented by available assets: 

S =
C; 

EP =
D 

	(e)
	Pro
rata cancellation of fully paid ordinary shares (not within (c) or (d)): 

	 
	 
	 
	 	 

	 	S = C ×	B
 A	 	;

	 
	 
	 
	 	 

	 	EP = D ×	A
 B	 	 

where:

	 
	 

	A =	The total number of Shares in issue before the capital reconstruction;
	

B =	

The total number of Shares in issue after the capital reconstruction;
	

C =	

The number of Shares which the Option Holder is entitled to subscribe for on exercise of an Option before the reconstruction;
	

S =	

The number of Shares which the Option Holder is entitled to subscribe for on exercise of an Option after the reconstruction;
	

D =	

The exercise price per Share of an Option before the capital reconstruction;
	

EP =	

The exercise price per Share of an Option after the capital reconstruction, fractions being rounded up to the nearest cent.

7.6      Lapse

            An
Option Holder may request that some or all of the Options held by that Option Holder lapse. 

7.7      Advice

            The
Bank must give notice to each Option Holder of any adjustment to the number of shares which the Option Holder is entitled to subscribe for or be issued on exercise of an Option or
the exercise price per share in accordance with the Listing Rules. 

7.8      Notices

            Notices
may be given by the Bank to the Option Holder in the manner prescribed by the articles of association of the Bank for the giving of notices to members of the Bank and the
relevant provisions of the articles of association of the Bank apply with all necessary modification to notices to Option Holders. 

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EXHIBIT 4.4

National Australia Bank Executive Share Option Plan No. 2

Rules

CONTENTS

National Australia Bank Executive Share Option Plan No. 2

National Australia Bank Executive Share Option Plan No. 2 Rules

SCHEDULE ONE: OPTION TERMS

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