Document:

Exhibit 4.1

 

_______________________________________

 

LLOYDS BANKING GROUP PLC

 

as Issuer,

 

and

 

THE BANK OF NEW YORK MELLON,

acting through its London Branch

 

as Trustee

 

_______________________________________

 

FIFTH SUPPLEMENTAL INDENTURE

 

dated as of May 8, 2018

 

to

 

THE SENIOR DEBT SECURITIES INDENTURE

 

dated as of July 6, 2010

 

_______________________________________

 

     

     

    

FIFTH SUPPLEMENTAL
INDENTURE (“Fifth Supplemental Indenture”), dated as of May 8, 2018, between LLOYDS BANKING GROUP PLC, a corporation
incorporated in Scotland with registered number 95000, as issuer (the “Company”) and THE BANK OF NEW YORK MELLON,
acting through its London Branch, as trustee (the “Trustee”).

 

WITNESSETH

 

WHEREAS,
the Company and the Trustee have executed and delivered a Senior Debt Securities Indenture dated as of July 6, 2010 (the “Senior
Indenture,” and together with this Fifth Supplemental Indenture, the “Indenture”) to provide for
the issuance of the Company’s Senior Debt Securities, including the Securities (as defined below).

 

WHEREAS,
Section 9.01(d) of the Senior Indenture permits the Company and the Trustee to add to, change or eliminate any provisions of the
Senior Indenture without the consent of Holders as permitted under Sections 2.01 and 3.01 of the Senior Indenture, subject to
certain conditions;

 

WHEREAS,
Section 9.01(f) of the Senior Indenture permits the Company and the Trustee to enter into a supplemental indenture to establish
the forms or terms of Senior Debt Securities of any series as permitted under Sections 2.01 and 3.01 of the Senior Indenture without
the consent of Holders;

 

WHEREAS,
there are no debt securities Outstanding of any series created prior to the execution of this Fifth Supplemental Indenture which
are entitled to the benefit of the provisions set forth herein or would be adversely affected by such provisions;

 

WHEREAS,
the Board of Directors has authorized the entry into this Fifth Supplemental Indenture, as required by Section 9.01 of the Senior
Indenture;

 

WHEREAS,
the parties hereto desire to establish, as further series of Senior Debt Securities under the Base Indenture, $1,500,000,000 4.450%
Senior Notes due 2025 (the “Securities”) pursuant to Sections 2.01 and 3.01 of the Senior Indenture. The Securities
may be issued from time to time and any Securities issued as part of any series will constitute a single series of Securities
under the Indenture and shall be included in the definition of “Securities” where the context requires;

 

WHEREAS,
the Company has requested that the Trustee execute and deliver this Fifth Supplemental Indenture and whereas all actions required
by it to be taken in order to make this Fifth Supplemental Indenture a valid, binding and enforceable instrument in accordance
with its terms, have been taken and performed, and the execution and delivery of this Fifth Supplemental Indenture has been duly
authorized in all respects; and

 

WHEREAS,
where indicated, this Fifth Supplemental Indenture shall amend and supplement the Senior Indenture; to the extent that the terms
of the Senior Indenture are inconsistent with such provisions of this Fifth Supplemental Indenture, the terms of this Fifth Supplemental
Indenture shall govern.

 

     

     

    

NOW,
THEREFORE, the Company and the Trustee mutually covenant and agree as follows:

 

Article
1

DEFINITIONS

 

Section
1.01.Definition of Terms. For all purposes of this Fifth Supplemental Indenture:

 

(a)       a
term defined anywhere in this Fifth Supplemental Indenture has the same meaning throughout;

 

(b)       capitalized
terms used herein but not otherwise defined shall have the meanings assigned to them in the Senior Indenture;

 

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

 

(d)       headings
are for convenience of reference only and do not affect interpretation; and

 

(e)       for
the purposes of this Fifth Supplemental Indenture and the Senior Indenture, the term “series” shall mean a series
of Securities.

 

Article
2

FORM OF SECURITIES

 

Section
2.01.Terms of the Securities.

 

(a)       The
title of the Securities shall be the “4.450% Senior Notes due 2025”;

 

(b)       The
aggregate principal amount of the Securities that may be authenticated and delivered under the Indenture shall not exceed $1,500,000,000,
except as otherwise provided in the Indenture;

 

(c)       Principal
on the Securities shall be payable on May 8, 2025 (the “Maturity Date”);

 

(d)       The
Securities shall be issued in global registered form on May 8, 2018 (the “Issue Date”) and shall bear interest
from May 8, 2018 payable semi-annually in arrears on May 8 and November 8 (each, an “Interest Payment Date”),
commencing November8, 2018. The Securities shall bear an annual interest rate of 4.450%;

 

Interest
on the Securities will be calculated on the basis of a 360-day year divided into twelve months of 30 days each and, in the case
of an incomplete month, the actual number of days elapsed in such period. The Regular Record Dates for the Securities will be
15 calendar days immediately preceding the relevant Interest Payment Date, whether or not a Business Day;

 

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(e)       No
premium, upon redemption or otherwise, shall be payable by the Company on the Securities;

 

(f)       Principal
of and any interest on the Securities shall be paid to the Holder through The Bank of New York Mellon, acting through its London
Branch, as paying agent of the Company;

 

(g)       The
Securities may be redeemable pursuant to Section 11.08 of the Senior Indenture. In connection with any redemption of the Securities
pursuant to Section 11.08 of the Senior Indenture, the date referenced therein shall be May 8, 2018;

 

(h)       The
Company shall have no obligation to redeem or purchase the Securities pursuant to any sinking fund or analogous provision;

 

(i)       The
Securities shall be issued only in denominations of $200,000 and in integral multiples of $1,000 in excess thereof;

 

(j)       The
principal amount of the Securities shall be payable upon the Maturity Date or the declaration of acceleration thereof pursuant
to Section 5.02 of the Senior Indenture, as amended by this Fifth Supplemental Indenture;

 

(k)       The
Securities shall not be converted into or exchanged at the option of the Company or otherwise for stock or other securities of
the Company;

 

(l)       The
Securities shall be denominated in, and payments thereon shall be made in, U.S. Dollars;

 

(m)       The
payment of principal of (and premium, if any) or interest, if any, on the Securities shall be payable only in the coin or currency
in which the Securities are denominated;

 

(n)       The
Securities shall be issued in the form of one or more global securities in registered form, without coupons attached, and the
initial Holder with respect to each such global security shall be Cede & Co., as nominee of The Depository Trust Company;

 

(o)       The
Securities shall not be initially issued in definitive form;

 

(p)       There
is no Calculation Agent for the Securities;

 

(q)       The
Events of Default on the Securities are as provided for in the Senior Indenture, as amended by this Fifth Supplemental Indenture;

 

(r)       The
form of the Securities to be issued on the date hereof shall be substantially in the form of Exhibit A hereto;

 

(s)       The
Company may issue additional Securities (“Additional Notes”) after the date hereof having the same ranking
and same interest rate, maturity date, redemption terms and other terms as the Securities except for the price to the public,
issue date and

 

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first
interest payment date, provided that such Additional Notes must be fungible with the outstanding Securities for U.S. federal income
tax purposes. Any such Additional Notes, together with the Securities will constitute a single series of securities under the
Indenture;

 

(t)       Additional
Amounts in respect of the Securities shall be payable as set forth in the Senior Indenture.

 

Article
3

ADDITIONAL TERMS APPLICABLE TO THE SECURITIES

 

Section
3.01.Addition of Definitions. With respect to the Securities only, Section 1.01 of the Senior Indenture is amended
to include the following definitions (which shall be deemed to arise in Section 1.01 in their proper alphabetical order):

 

“Default”
has the meaning specified in Section 5.03.

 

“Group”
means Lloyds Banking Group plc together with its subsidiaries and associated undertakings.

 

“Loss
Absorption Disqualification Event” shall be deemed to have occurred if, as a result of any amendment to, or change in,
the Loss Absorption Regulations, or any change in the application or official interpretation of the Loss Absorption Regulations,
in any such case becoming effective on or after the Issue Date of the first tranche of the Securities of the relevant series,
such Securities are or (in the opinion of the Company or the opinions of the Relevant Regulator and/or the United Kingdom resolution
authority) are likely to be fully or partially excluded from the Company’s or the Group’s minimum requirements for
(A) own funds and eligible liabilities and/or (B) loss absorbing capacity instruments, in each case as such minimum requirements
are applicable to the Company and/or the Group and determined in accordance with, and pursuant to, the relevant Loss Absorption
Regulations; provided that a Loss Absorption Disqualification Event shall not occur where the exclusion of the Securities from
the relevant minimum requirement(s) is due to the remaining maturity of the Securities being less than any period prescribed by
any applicable eligibility criteria for such minimum requirements under the relevant Loss Absorption Regulations effective with
respect to the Company and/or the Group on the issue date of the first tranche of the Securities of the relevant series.

 

“Loss
Absorption Regulations” means, at any time, the laws, regulations, requirements, guidelines, rules, standards and policies
relating to minimum requirements for own funds and eligible liabilities and/or loss absorbing capacity instruments of the United
Kingdom, the Relevant Regulator, the United Kingdom resolution authority, the Financial

 

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Stability
Board and/or of the European Parliament or of the Council of the European Union then in effect in the United Kingdom including,
without limitation to the generality of the foregoing, any delegated or implementing acts (such as regulatory technical standards)
adopted by the European Commission and any regulations, requirements, guidelines, rules, standards and policies relating to minimum
requirements for own funds and eligible liabilities and/or loss absorbing capacity instruments adopted by the Relevant Regulator
and/or the United Kingdom resolution authority from time to time (whether or not such regulations, requirements, guidelines, rules,
standards or policies are applied generally or specifically to the Company or to the Group).

 

“Relevant
Regulator” means the Prudential Regulation Authority, the Bank of England or such other governmental authority in the
United Kingdom (or if the Company becomes domiciled in a jurisdiction other than the United Kingdom, in such other jurisdiction)
having primary supervisory authority with respect to the Company and/or the Group with respect to prudential and/or resolution
matters, as the case may be.

 

“relevant
U.K. resolution authority” means any authority with the ability to exercise a U.K. bail-in power.

 

“U.K.
bail-in power” means any write-down and/or conversion power existing from time to time under any laws, regulations,
rules or requirements relating to the resolution of banks, banking group companies, credit institutions and/or investment firms
incorporated in the United Kingdom in effect and applicable in the United Kingdom to the Company and the Group, including but
not limited to any such laws, regulations, rules or requirements which are implemented, adopted or enacted within the context
of a European Union directive or regulation of the European Parliament and of the Council establishing a framework for the recovery
and resolution of credit institutions and investment firms and/or within the context of a U.K. resolution regime under the U.K.
Banking Act 2009 as the same has been or may be amended from time to time (whether pursuant to the U.K. Financial Services (Banking
Reform) Act 2013, secondary legislation or otherwise), pursuant to which obligations of a bank, banking group company, credit
institution or investment firm or any of its affiliates can be reduced, cancelled, amended, transferred and/or converted into
shares or other securities or obligations of the obligor or any other person.

 

Section
3.02.Deletion of Definitions. With respect to the Securities only, the following definitions shall be deleted in their
entirety in Section 1.01 of the Senior Indenture:

 

“Default
Interest” has the meaning specified in ‎Section 3.07.

 

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Section
3.03.Payment; Interest Rights Preserved. With respect to the Securities only, Section 3.07 is amended and restated
in its entirety and shall read as follows:

 

Section
3.07. Payment; Interest Rights Preserved. Except as otherwise provided as contemplated by ‎Section 3.01 with
respect to any series of Senior Debt Securities, interest, if any, on any Senior Debt Securities which is payable, and is paid
or duly provided for, on any Interest Payment Date shall be paid to the Holder (including if held through a Paying Agent of the
Company designated pursuant to ‎Section 3.01 outside the United Kingdom for collection by the Holder) at the close
of business on the Regular Record Date for such interest.

 

In
the case of Senior Debt Securities where payment is to be made in Dollars, payment at any Paying Agent’s office outside
The City of New York will be made in Dollars by check drawn on, or, at the request of the Holder, by transfer to a Dollar account
maintained by the payee with, a bank in The City of New York.

 

In
the case of Senior Debt Securities where payment is to be made in a Foreign Currency, payment will be made as established pursuant
to ‎Section 3.01.

 

Subject
to the foregoing provisions of this Section, each Senior Debt Security delivered under this Senior Debt Securities Indenture upon
registration of transfer of or in exchange for or in lieu of any other Senior Debt Security shall carry the rights to interest
accrued and unpaid, and to accrue, which were carried by such other Senior Debt Security.

 

Section
3.04.Events of Default. With respect to the Securities only, Section 5.01 of the Senior Indenture is amended and restated
in its entirety and shall read as follows:

 

Section
5.01. Events of Default. “Event of Default”, wherever used herein with respect to Senior Debt Securities
of a particular series, means the making of an order by a court of competent jurisdiction which is not successfully appealed within
30 days of the making of such order, or valid adoption by the shareholders of the Company of an effective resolution, for the
winding-up of the Company (other than under or in connection with a scheme of amalgamation or reconstruction not involving bankruptcy
or insolvency). The exercise of any U.K. bail-in power by the relevant U.K. resolution authority shall not constitute a default
or an Event of Default under this Section 5.01 or a Default under Section 5.03.

 

Section
3.05.Acceleration of Maturity; Rescission and Annulment. With respect to the Securities only, Section 5.02 of the Senior
Indenture is amended by adding the following at the end of the section:

 

If
the Senior Debt Securities become due and payable (whether pursuant to this Section 5.02 or Article 11 below) and the Company
fails to pay such

 

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amounts
(or any damages awarded for breach of any obligations in respect of the Senior Debt Securities or this Senior Debt Securities
Indenture) forthwith upon demand, notwithstanding the continuing right of any Holder to receive payment of the principal of and
interest on Senior Debt Securities, or to institute suit for the enforcement of any such payment, each in accordance with Section
316(b) (Directions and Waivers by Bondholders; Prohibition of Impairment of Holders’ Right to Repayment) of the Trust
Indenture Act, the Trustee, in its own name and as trustee of an express trust, may institute proceedings for the winding up of
the Company, and/or prove in a winding up of the Company for all such due and payable amounts (including any damages awarded for
breach of any obligations in respect of the Senior Debt Securities or this Senior Debt Securities Indenture) but no other remedy
shall be available to the Trustee or the Holders.

 

Section
3.06.Defaults; Collection of Indebtedness and Suits for Enforcement by Trustee. With respect to the Securities only,
Section 5.03 of the Senior Indenture is amended and restated in its entirety and shall read as follows:

 

Section
5.03. Defaults; Collection of Indebtedness and Suits for Enforcement by Trustee. “Default” wherever
used herein with respect to Senior Debt Securities of a particular series, means any one of the following events (subject as provided
below, whatever the reason for such Default and whether it shall be voluntary or involuntary or be effected by operation of law
pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental
body):

 

(a)
the Company fails to pay any installment of interest on any Senior Debt Security of such series on or before its Interest Payment
Date and such failure continues for 14 days; or

 

(b)
the Company fails to pay all or any part of the principal of any Senior Debt Security of such series on any date on which such
principal shall otherwise have become due and payable, whether upon redemption or otherwise, and such failure continues for seven
days.

 

If
a Default occurs, the Trustee may commence a proceeding for the winding-up of the Company and/or prove in a winding-up of the
Company, provided that the Trustee may not (except in such winding-up, in accordance with Section 5.01) declare the principal
amount of, or any other amount in respect of, any Outstanding Senior Debt Security to be due and payable.

 

Subject
to applicable law, including the Trust Indenture Act, no Holder may exercise or claim any right of set-off, counterclaim, combination
of accounts, compensation or retention in respect of any amount owed to it by the Company arising under or in connection with
the Senior Debt Securities. The Holders of Senior Debt Securities by their acceptance thereof will be deemed to have waived any
right of set-off, counterclaim, combination of accounts, compensation and

 

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retention
with respect to the Senior Debt Securities or this Senior Debt Securities Indenture (or between the obligations under or in respect
of any Senior Debt Securities and any liability owed by a Holder to the Company) that they might otherwise have against the Company,
whether before or during a winding-up or liquidation of the Company. Notwithstanding the above, if any of such rights and claims
of any such Holder against the Company are discharged by set-off, such Holder will immediately pay an amount equal to the amount
of such discharge to the Company or, in the event of the winding up of the Company, the liquidator or administrator (or other
relevant insolvency official), as the case may be, and until such time as payment is made will hold a sum equal to such amount
in trust for the Company or the liquidator or administrator (or other relevant insolvency official), as the case may be, and accordingly
such discharge shall be deemed not to have taken place.

 

Notwithstanding
the foregoing, failure to make any payment in respect of a series of Senior Debt Securities shall not be a Default in respect
of such Senior Debt Securities if such payment is withheld or refused and the Company delivers an Opinion of Counsel concluding
that such sums were not paid in order to comply with any fiscal or other law or regulation or with the order of any court of competent
jurisdiction, provided, however, that the Trustee may by notice to the Company require the Company to take such action (including
but not limited to proceedings for a declaration by a court of competent jurisdiction) as the Trustee may be advised in an Opinion
of Counsel, upon which opinion the Trustee may conclusively rely, is appropriate and reasonable in the circumstances to resolve
such doubt, in which case the Company shall forthwith take and expeditiously proceed with such action and shall be bound by any
final resolution of the doubt resulting therefrom. If any such action results in a determination that the relevant payment can
be made without violating any applicable law, regulation or order then the provisions of the preceding sentence shall cease to
have effect and the payment shall become due and payable on the expiration of 14 days (in the case of payments under Section 5.03(a)
above) or seven days (in the case of payments under Section 5.03(b) above) after the Trustee gives written notice to the Company
informing it of such resolution.

 

Except
as otherwise provided in this Article 5, the Trustee may in its discretion proceed to protect and enforce its rights and the rights
of the Holders of Senior Debt Securities of such series by such appropriate judicial proceedings as the Trustee shall deem most
effectual to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Senior
Debt Securities Indenture or in aid of the exercise of any power granted herein, or to enforce any other legal or equitable right
vested in the Trustee by this Senior Debt Securities Indenture or by law, provided, however, that the Company shall not, as a
result of the bringing of such judicial proceedings, be required to pay any amount representing or measured by reference to the
principal of, or any interest on, the Senior Debt Securities prior to any date on which the principal of, or any interest on,
the Senior Debt Securities would have otherwise been payable by the Company.

 

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No
recourse for the payment of the principal of (or premium, if any) or interest, if any, on any Senior Debt Security, or for any
claim based thereon or otherwise in respect thereof and no recourse under or upon any obligation, covenant or agreement of the
Company in this Senior Debt Securities Indenture, or in any Senior Debt Security, or because of the creation of any indebtedness
represented thereby, shall be had against any incorporator, stockholder, officer or director, past, present or future, of the
Company or of any successor corporation of the Company, either directly or through the Company or any successor corporation, whether
by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being
expressly understood that to the extent lawful all such liability is hereby expressly waived and released as a condition of, and
as a consideration for, the execution of this Senior Debt Securities Indenture and the issue of the Senior Debt Securities.

 

No
remedy against the Company other than as referred to in this Article 5 shall be available to the Trustee or the Holders, whether
for the recovery of amounts owing in respect of the Senior Debt Securities or under this Senior Debt Securities Indenture or in
respect of any breach by the Company of any of its other obligations under or in respect of the Senior Debt Securities or under
this Senior Debt Securities Indenture, except that the Trustee and the Holders shall have such rights and powers as they are required
to have under the Trust Indenture Act.

 

Section
3.07.With respect to the Securities only, (a) Sections 5.07(a), 5.07(b), 5.11, 5.13, 6.02, 6.03(i), 8.01(b), 8.03(c) and 10.03(b)
shall be amended to add the words “or Default” after each appearance of the words “Event of Default” and
(b) Section 11.08 shall be amended to replace in the first paragraph the word “Unless” with the words “Subject
to Section 11.1 and unless”.

 

Section
3.08.Deletion of Satisfaction and Discharge Provisions. With respect to the Securities only, Article 4 of the Senior
Indenture is deleted in its entirety.

 

Section
3.09.Compensation and Reimbursement. With respect to the Securities only, Section 6.07 of the Senior Indenture is amended
in part to add the following sentence at the end of the section:

 

The
Trustee’s right to reimbursement and indemnity under this Section 6.07 shall survive the payment in full of the Senior Debt
Securities, the discharge of this Senior Debt Securities Indenture, the resignation or removal of the Trustee and (without prejudice
to Section 4.08 of the Fifth Supplemental Indenture if and to the extent applicable as set out therein) any exercise of the U.K.
bail-in power by the relevant U.K. resolution authority with respect to the obligations owed or owing to Holders pursuant to or
in connection with the Senior Debt Securities.

 

    10 

     

    

Section
3.10.Agreement with Respect to Exercise of U.K. Bail-In Power. The following provisions relate solely to the Securities
established pursuant to this Fifth Supplemental Indenture:

 

(a)       Notwithstanding
any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial Owner of the Securities,
by purchasing or acquiring the Securities, each Holder (including each Beneficial Owner) of the Securities acknowledges, accepts,
agrees to be bound by and consents to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority that may
result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on, the Securities;
(ii) the conversion of all, or a portion, of the principal amount of, or interest on, the Securities into shares or other securities
or other obligations of the Company or another person; and/or (iii) the amendment or alteration of the maturity of the Securities,
or amendment of the amount of interest due on the Securities, or the dates on which interest becomes payable, including by suspending
payment for a temporary period; which U.K. bail-in power may be exercised by means of variation of the terms of the Securities
solely to give effect to the exercise by the relevant U.K. resolution authority of such U.K. bail-in power. Each Holder and Beneficial
Owner of the Securities further acknowledges and agrees that the rights of the Holders and/or Beneficial Owners under the Securities
are subject to, and will be varied, if necessary, solely to give effect to, the exercise of any U.K. bail-in power by the relevant
U.K. resolution authority.

 

(b)       By
purchasing or acquiring the Securities, each Holder and each Beneficial Owner of the Securities:

 

(i)       acknowledges
and agrees that the exercise of the U.K. bail-in power by the relevant U.K. resolution authority in respect of the Securities
shall not give rise to a default or an Event of Default for purposes of Section 315(b) (Notice of Default) and Section 315(c)
(Duties of the Trustee in Case of Default) of the Trust Indenture Act;

 

(ii)       to
the extent permitted by the Trust Indenture Act, waives any and all claims against the Trustee for, agrees not to initiate a suit
against the Trustee in respect of, and agrees that the Trustee shall not be liable for, any action that the Trustee takes, or
abstains from taking, in either case in accordance with the exercise of the U.K. bail-in power by the relevant U.K. resolution
authority with respect to the Securities; and

 

(iii)       acknowledges
and agrees that, upon the exercise of any U.K. bail-in power by the relevant U.K. resolution authority, (a) the Trustee shall
not be required to take any further directions from Holders of the Securities under Section 5.12 of the Senior Indenture, and
(b) neither the Senior Indenture nor this Fifth Supplemental Indenture shall impose any duties upon the Trustee whatsoever with
respect to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority. Notwithstanding the foregoing, if,
following the completion of the exercise of the U.K. bail-in power by the relevant U.K. resolution authority, any of the Securities
remain outstanding (for example, if the

 

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exercise
of the U.K. bail-in power results in only a partial write-down of the principal of the Securities), then the Trustee’s duties
under the Indenture shall remain applicable with respect to the Securities following such completion to the extent that the Company
and the Trustee shall agree pursuant to a supplemental indenture or an amendment to this Fifth Supplemental Indenture.

 

(c)       By
purchasing or acquiring the Securities, each Holder and Beneficial Owner that acquires its Securities in the secondary market
shall be deemed to acknowledge and agree to be bound by and consent to the same provisions specified in the Indenture to the same
extent as the Holders and Beneficial Owners of the Securities that acquire the Securities upon their initial issuance, including,
without limitation, with respect to the acknowledgement and agreement to be bound by and consent to the terms of the Securities
related to the U.K. bail-in power.

 

(d)       By
purchasing or acquiring the Securities, each Holder and Beneficial Owner shall be deemed to have (i) consented to the exercise
of any U.K. bail-in power as it may be imposed without any prior notice by the relevant U.K. resolution authority of its decision
to exercise such power with respect to the Securities and (ii) authorized, directed and requested DTC and any direct participant
in DTC or other intermediary through which it holds such Securities to take any and all necessary action, if required, to implement
the exercise of any U.K. bail-in power with respect to the Securities as it may be imposed, without any further action or direction
on the part of such Holder or Beneficial Owner or the Trustee.

 

(e)       No
repayment of the principal amount of the Securities or payment of interest on the Securities shall become due and payable after
the exercise of any U.K. bail-in power by the relevant U.K. resolution authority unless, at the time that such repayment or payment,
respectively, is scheduled to become due, such repayment or payment would be permitted to be made by the Company under the laws
and regulations of the United Kingdom and the European Union applicable to the Company and the Group.

 

(f)       Upon
the exercise of the U.K. bail-in power by the relevant U.K. resolution authority with respect to the Securities, the Company shall
provide a written notice to DTC as soon as practicable regarding such exercise of the U.K. bail-in power for purposes of notifying
Holders of such occurrence. The Company shall also deliver a copy of such notice to the Trustee for information purposes only.

 

Section
3.11.Redemption of Securities. With respect to the Securities only, Article 11 of the Senior Indenture is amended to
add a Section 11.09 and a Section 11.10, each of which shall read as follows:

 

Section
11.09 Loss Absorption Disqualification Event Redemption.

 

Subject
to Section 11.10, the Company may, at the Company’s option (but subject to, if and to the extent then required by the Relevant
Regulator or the Loss Absorption Regulations, the Company giving notice to the Relevant Regulator

 

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and
the Relevant Regulator granting the Company permission), having given not less than 30 nor more than 60 days’ notice to
holders, redeem all but not some only of the Securities outstanding at any time at 100% of their principal amount together with
any accrued but unpaid interest to the date of redemption, if immediately prior to the giving of the notice referred to above,
the Company satisfies the Trustee that a Loss Absorption Disqualification Event has occurred.

 

Section
11.10. Conditions to Redemption and Repurchase, etc.

 

Notwithstanding
anything herein to the contrary, any redemption or purchase of Securities (other than redemption on the relevant Maturity Date),
and any modification to the terms of the Securities or any indenture relating thereto, is subject to, if and to the extent then
required by the Relevant Regulator or the Loss Absorption Regulations, the Company giving notice to the Relevant Regulator and
the Relevant Regulator granting the Company permission therefor and otherwise to compliance with the Loss Absorption Regulations
if and to the extent then required thereunder.

 

Article
4

MISCELLANEOUS

 

Section
4.01.Effect Of Supplemental Indenture. Upon the execution and delivery of this Fifth Supplemental Indenture by each
of the Company and the Trustee, and the delivery of the documents referred to in Section 5.02 herein, the Senior Indenture shall
be supplemented in accordance herewith, and this Fifth Supplemental Indenture shall form a part of the Senior Indenture for all
purposes in respect of the Securities or otherwise as applicable.

 

Section
4.02.Other Documents to be Given to the Trustee. The Trustee shall be entitled to receive an Officer’s Certificate
and an Opinion of Counsel stating the recitals contained in Section 1.02 of the Senior Indenture and, in the case of the Opinion
of Counsel, stating that the Indenture is a legal, binding a valid obligation of the Company enforceable in accordance with its
terms. As specified in Section 9.03 of the Senior Indenture and subject to the provisions of Section 6.03 of the Senior Indenture,
the Trustee shall also be entitled to receive an Opinion of Counsel stating that that this Fifth Supplemental Indenture is authorized
or permitted by the Indenture, and the Fifth Supplemental Indenture and the Securities whose terms are incorporated by reference
herein are each, subject to Section 1.03 of the Senior Indenture, a legal, valid and binding obligation of the Company enforceable
in accordance with their terms, except as the enforceability thereof may be limited by bankruptcy, insolvency, reorganization,
moratorium or other laws relating to or affecting creditor’s rights generally, by equitable principles of general applicability
and by possible judicial actions giving effect to governmental actions or foreign laws affecting creditors’ rights, and
the Fifth Supplemental Indenture is permitted under the Indenture. The Trustee may rely on such

 

    13 

     

    

Officer’s
Certificate and Opinion of Counsel as conclusive evidence that this Fifth Supplemental Indenture complies with the applicable
provisions of the Senior Indenture.

 

Section
4.03.Confirmation Of Indenture. The Senior Indenture, as supplemented and amended by this Fifth Supplemental Indenture
with respect to the Securities or otherwise as applicable, is in all respects ratified and confirmed, and the Senior Indenture,
this Fifth Supplemental Indenture and all indentures supplemental thereto shall, in respect of the Securities or otherwise as
applicable, be read, taken and construed as one and the same instrument. This Fifth Supplemental Indenture constitutes an integral
part of the Senior Indenture and, where applicable, with respect to the Securities. In the event of a conflict between the terms
and conditions of the Senior Indenture and the terms and conditions of this Fifth Supplemental Indenture, the terms and conditions
of this Fifth Supplemental Indenture shall prevail where applicable.

 

Section
4.04.Concerning The Trustee. The Trustee does not make any representations as to the validity or sufficiency of this
Fifth Supplemental Indenture or the Securities. The recitals and statements herein are deemed to be those of the Company and not
the Trustee. In entering into this Fifth Supplemental Indenture, the Trustee shall be entitled to the benefit of every provision
of the Senior Indenture relating to the conduct of or affecting the liability of or affording protection to the Trustee.

 

Section
4.05.Governing Law. This Fifth Supplemental Indenture and the Securities shall be governed by and construed in accordance
with the laws of the State of New York, except that the authorization and execution by the Company of this Fifth Supplemental
Indenture and the Securities shall be governed by (in addition to the laws of the State of New York relevant to execution) the
respective jurisdictions of the Company and the Trustee, as the case may be.

 

Section
4.06.Separability. In case any provision contained in this Fifth Supplemental Indenture shall be invalid, illegal or
unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired
thereby.

 

Section
4.07.Counterparts. This Fifth Supplemental Indenture may be executed in any number of counterparts, each of which shall
be an original, but such counterparts shall together constitute but one and the same instrument.

 

Section
4.08.Concerning BRRD Liability. Notwithstanding and to the exclusion of any other term of this Fifth Supplemental Indenture
or the Senior Indenture or any other agreements, arrangements, or understanding between the Company and the Trustee, the Trustee
acknowledges and accepts

 

    14 

     

    

that
a BRRD Liability arising under this Fifth Supplemental Indenture may be subject to the exercise of Bail-in Powers by the relevant
Resolution Authority (but only to the extent applicable) and acknowledges, accepts, and agrees to be bound by:

 

(a)       the
effect of the exercise of Bail-in Powers by the Relevant Resolution Authority in relation to any BRRD Liability of the Company
to the Trustee under this Fifth Supplemental Indenture or the Senior Indenture, that (without limitation) may include and result
in any of the following, or some combination thereof:

 

(i)       the
reduction of all, or a portion, of the BRRD Liability or outstanding amounts due thereon;

 

(ii)       the
conversion of all, or a portion, of the BRRD Liability into shares, other securities or other obligations of the Company or another
person (and the issue to or conferral on the Trustee of such shares, securities or obligations);

 

(iii)       the
cancellation of the BRRD Liability; and/or

 

(iv)       the
amendment or alteration of any interest, if applicable, thereon, the maturity or the dates on which any payments are due, including
by suspending payment for a temporary period; and

 

(b)       the
variation of the terms of this Fifth Supplemental Indenture, as deemed necessary by the Relevant Resolution Authority, to give
effect to the exercise of Bail-in Powers by the Relevant Resolution Authority.

 

“Bail-in
Legislation” means Part I of the U.K. Banking Act 2009 and any other law, regulation, rule or requirement applicable
from time to time in the UK relating to the resolution of unsound or failing banks, investment firms or other financial institutions
or their affiliates (otherwise than through liquidation, administration or other insolvency proceedings).

 

“Bail-in
Powers” means any Write-down and Conversion Powers as defined in relation to the Bail-in Legislation.

 

“BRRD”
means Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms.

 

“BRRD
Liability” means a liability in respect of which the relevant Write-down and Conversion powers in the applicable Bail-in
Legislation may be exercised.

 

“Relevant
Resolution Authority” means the resolution authority with the ability to exercise any Bail-in Powers in relation to
the Company.

 

“Write-down
and Conversion Powers” means the powers under the Bail-In Legislation to cancel, transfer or dilute shares issued by
a person that is a bank or

 

    15 

     

    

investment
firm or affiliate of a bank or investment firm, to cancel, reduce, modify or change the form of a liability of such a person or
any contract or instrument under which that liability arises, to convert all or part of that liability into shares, securities
or obligations of that person or any other person, to provide that any such contract or instrument is to have effect as if a right
had been exercised under it or to suspend any obligation in respect of that liability.

 

[Signature
Pages Follow]

 

    16 

     

    

IN WITNESS
WHEREOF, the parties hereto have caused this Fifth Supplemental Indenture to be duly executed as of the date first written above.

 

	 	LLOYDS BANKING GROUP PLC	 
	 	 	 
	 	By:	/s/ Gavin Parker	 
	 	 	 	 
	 	 	Name: Gavin Parker

    Title: Head of Securitisation and Collateral	 

 

 

 

[Signature Page to Fifth Supplemental Indenture] 

     

     

    

	 	THE BANK
OF NEW YORK MELLON, 

        LONDON BRANCH, as Trustee 
	 
	 	 	 
	 	By:	/s/ Marilyn Chau	 
	 	 	 	 
	 	 	Name: Marilyn Chau

    Title: Vice President	 

 

 

[Signature
Page to Fifth Supplemental Indenture] 

    

     

    

EXHIBIT
A

 

FORM
OF 2025 FIXED RATE SENIOR GLOBAL NOTE

 

THIS SECURITY
IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY
OR A NOMINEE THEREOF. THIS SECURITY MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A SECURITY REGISTERED, AND NO TRANSFER OF THIS
SECURITY IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT
IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

CUSIP
No. 53944Y AF0

ISIN No. US53944YAF07

Common Code: 181959380

 

LLOYDS BANKING
GROUP plc

 

4.450% SENIOR
NOTE DUE 2025

 

	No. [1]	$500,000,000

 

LLOYDS BANKING
GROUP plc (herein called the “Company,” which term includes any successor person under the Indenture (as defined on
the reverse hereof)), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of
$500,000,000 (five hundred million dollars) on May 8, 2025 (the “Maturity Date”) or on such earlier date as the principal
hereof may become due in accordance with the terms hereof and to pay interest thereon semi-annually in arrears on May 8 and November
8 of each year, commencing on November 8, 2018, and ending on May 8, 2025 (each, an “Interest Payment Date”). Interest
so payable on any Interest Payment Date shall be paid to the Holder in whose name this Senior Note is registered on the 15th
calendar day immediately preceding the relevant Interest Payment Date, whether or not such day is a Business Day, as defined
in the Indenture (each a “Regular Record Date”). If (i) the Company fails to pay any installment of interest on any
Senior Note on or before its Interest Payment Date and such failure continues for 14 days or (ii) the Company fails to pay all
or any part of the principal of any Senior Note on any date on which such principal shall otherwise have become due and payable,
whether upon redemption or otherwise, and such failure continues for seven days (each of (i) and (ii), a “Default”),
the Trustee may commence a proceeding for the winding up of the Company, provided that the Trustee may not, upon the occurrence
of a Default, declare the principal amount of any of the Outstanding Senior Notes to be due and payable.

 

    A-1 

     

    

Interest
shall accrue on this Senior Note from day to day from the date of issuance hereof or from the most recent Payment Date at the
rate of 4.450% per annum, until the principal amount hereof is paid or made available for payment.

 

Payments
of interest on this Senior Note shall be computed on the basis of a 360-day year divided into twelve months of 30 days each and,
in the case of an incomplete month, the actual number of days elapsed in such period.

 

Payment
of the principal amount of (and premium, if any) and any interest on, this Senior Note will be made in such coin or currency of
the United States of America as at the time of payment is legal tender for payment of public and private debts. Such payment shall
be made to the Holder including through a Paying Agent of the Company outside the United Kingdom for collection by the Holder.
If the date for payment of the principal amount hereof (and premium, if any) or interest thereon is not a Business Day, then (subject
as provided in the Indenture) such payment shall be made on the next succeeding Business Day with the same force and effect as
if made on such date for payment and without any interest or other payment in respect of such delay.

 

Prior
to due presentment of this Senior Note for registration of transfer, the Company, the trustee and any agent of the Company or
the trustee may treat the Person in whose name this Senior Note is registered as the owner of such Senior Note for the purpose
of receiving payment of principal and interest, if any, on such Senior Note and for all other purposes whatsoever, whether or
not such Senior Note be overdue, and neither the Company, the trustee nor any agent of the Company or the trustee shall be affected
by notice to the contrary.

 

Reference
is hereby made to the further provisions of this Senior Note set forth on the reverse hereof, which further provisions shall for
all purposes have the same effect as if set forth at this place.

 

Unless
the certificate of authentication hereon has been executed by the trustee referred to on the reverse hereof by manual signature,
this Senior Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

Notwithstanding
any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial Owner of this Senior Note,
by purchasing or acquiring this Senior Note, each Holder (including each Beneficial Owner) of this Senior Note acknowledges, accepts,
agrees to be bound by and consents to the exercise of any U.K. bail-in power (as defined below) by the relevant U.K. resolution
authority that may result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on,
this Senior Note; (ii) the conversion of all, or a portion, of the principal amount of, or interest on, this Senior Note into
shares or other securities or other obligations of the Company or another person; and/or (iii) the amendment or alteration of
the maturity of this Senior Note, or amendment of the amount of interest due on this Senior Note, or the dates on which interest
becomes payable, including by suspending payment for a temporary period; which U.K. bail-in power may be exercised by means of
variation of the terms of this Senior Note solely to give effect to the exercise by the

 

    A-2 

     

    

relevant
U.K. resolution authority of such U.K. bail-in power. Each Holder and Beneficial Owner of this Senior Note further acknowledges
and agrees that the rights of the Holders and/or Beneficial Owners under this Senior Note are subject to, and will be varied,
if necessary, solely to give effect to, the exercise of any U.K. bail-in power by the relevant U.K. resolution authority.

 

For
these purposes, a “U.K. bail-in power” is any write-down, conversion, transfer, modification or suspension power existing
from time to time under any laws, regulations, rules or requirements relating to the resolution of banks, banking group companies,
credit institutions and/or investment firms incorporated in the United Kingdom in effect and applicable in the United Kingdom
to the Company and the Group, including but not limited to any such laws, regulations, rules or requirements which are implemented,
adopted or enacted within the context of a European Union directive or regulation of the European Parliament and of the Council
establishing a framework for the recovery and resolution of credit institutions and investment firms and/or within the context
of a U.K. resolution regime under the U.K. Banking Act 2009 as the same has been or may be amended from time to time (whether
pursuant to the U.K. Financial Services (Banking Reform) Act 2013, secondary legislation or otherwise), pursuant to which any
obligations of a bank, banking group company, credit institution or investment firm or any of its affiliates can be reduced, cancelled,
modified, transferred and/or converted into shares or other securities or obligations of the obligor or any other person (or suspended
for a temporary period) or pursuant to which any right in a contract governing such obligations may be deemed to have been exercised.
A reference to the “relevant U.K. resolution authority” is to any authority with the ability to exercise a U.K. bail-in
power.

 

[The rest
of this page is intentionally left blank]

 

    A-3 

     

    

IN
WITNESS WHEREOF, the Company has caused this Senior Note to be duly executed.

 

Dated: May 8, 2018

 

	 	LLOYDS BANKING GROUP PLC	 
	 	 	 
	 	Name:	 
	 	Title:   	 

 

 

 

[2025
Fixed Rate Global Note No. [1] Signature Page] 

    A-4 

     

    

CERTIFICATE
OF AUTHENTICATION

 

This
is one of the Senior Notes of the series designated herein referred to in the within-mentioned Indenture.

 

Dated: May 8, 2018

 

	 	THE BANK OF NEW YORK MELLON,	 
	 	LONDON BRANCH, as Trustee	 
	 	 	 
	 	 	 
	 	By:		 
	 	 	Authorized Signatory	 

 

 

[2025
Fixed Rate Global Note No. [1] Signature Page]

 

    A-5 

     

    

[REVERSE
OF SECURITY]

 

This
Senior Note is one of a duly authorized issue of securities of the Company (herein called the “Senior Notes”) issued
and to be issued in one or more series under a Senior Debt Securities Indenture, dated as of July 6, 2010 (herein called the “Senior
Indenture”), among the Company, as issuer, and The Bank of New York Mellon, as trustee (herein called the “Trustee,”
which term includes any successor trustee under the Senior Indenture), as supplemented by the Fifth Supplemental Indenture dated
as of May 8, 2018, among the Company and the Trustee (the “Fifth Supplemental Indenture” and, together with the Senior
Indenture, the “Indenture”) to which Indenture and all indentures supplemental thereto reference is hereby made for
a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and
the Holders of the Senior Notes and of the terms upon which the Senior Notes are, and are to be, authenticated and delivered.

 

This
Senior Note is one of the series designated on the face hereof, initially limited in aggregate principal amount to $1,500,000,000.
The Company may, without the consent of the Holders of the Senior Notes, issue additional notes having the same ranking and interest
rate, maturity date, redemption terms and other terms as the Senior Notes except for the price to the public, issue date and first
interest payment date, provided that such additional notes must be fungible with the outstanding Senior Notes for U.S. federal
income tax purposes. Any such Senior Notes, together with this Senior Note, will constitute a single series of securities under
the Indenture. The Senior Notes will initially be issued in the form of one or more global Senior Notes (each, a “Global
Senior Note”). Except as provided in the Indenture, a Global Senior Note shall not be exchangeable for one or more definitive
Senior Notes.

 

The
Senior Notes of this series will constitute unsecured and unsubordinated obligations of the Company, as described herein, and
will rank pari passu without any preference among themselves.

 

If
an Event of Default with respect to the Senior Notes of this series shall have occurred and be continuing, the Trustee or the
Holder or Holders of not less than 25% in aggregate principal amount of the Outstanding Senior Notes of this series may declare
the principal amount of, and any accrued interest on, all the Senior Notes to be due and payable immediately, in the manner, with
the effect and subject to the conditions provided in the Indenture.

 

Except
as otherwise provided in Article 5 of the Senior Indenture, the Trustee may in its discretion proceed to protect and enforce its
rights and the rights of Holders of Senior Notes by such appropriate judicial proceedings as the Trustee shall deem most effectual
to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in the Indenture or
in aid of the exercise of any power granted herein, or to enforce any other legal or equitable right vested in the Trustee by
the Indenture or by law, provided, however, that the Company shall not, as a result of the bringing of such judicial proceedings,
be required to pay any amount representing or measured by reference to the principal of, or any interest on, the Senior Notes
prior to any

 

    A-6 

     

    

date
on which the principal of, or any interest on, the Senior Notes would have otherwise been payable by the Company.

 

If
a Default occurs, the Trustee may commence a proceeding for the winding-up of the Company and/or prove in a winding-up of the
Company, provided that the Trustee may not, upon the occurrence of a Default, declare the principal amount of any of the Outstanding
Senior Notes to be due and payable.

 

Failure
to make any payment in respect of this Senior Note shall not be a Default if such payment is withheld or refused and an Opinion
of Counsel is delivered to the Trustee concluding that such sums were not paid in order to comply with any fiscal or other law
or regulation or with the order of any court of competent jurisdiction, provided, however, that the Trustee may by notice to the
Company require the Company to take such action (including but not limited to proceedings for a declaration by a court of competent
jurisdiction) as the Trustee may be advised in an Opinion of Counsel, upon which opinion the Trustee may conclusively rely, is
appropriate and reasonable in the circumstances to resolve such doubt, in which case the Company shall forthwith take and expeditiously
proceed with such action and shall be bound by any final resolution of the doubt resulting therefrom. If any such action results
in a determination that the relevant payment can be made without violating any applicable law, regulation or order then the provisions
of the preceding sentence shall cease to have effect and the payment shall become due and payable on the expiration of 14 days
(in the case of payments under Section 5.03(a) of the Senior Indenture) or seven days (in the case of payments under Section 5.03(b)
of the Senior Indenture) after the Trustee gives written notice to the Company informing it of such resolution.

 

Subject
to applicable law, no Holder may exercise or claim any right of set-off, counterclaim, combination of accounts, compensation or
retention in respect of any amount owed to it by the Company arising under or in connection with the Senior Notes. The Holders
of Senior Notes by their acceptance thereof will be deemed to have waived any right of set-off, counterclaim, combination of accounts,
compensation and retention with respect to the Senior Notes or the Senior Indenture (or between the obligations under or in respect
of any Senior Notes and any liability owed by a Holder to the Company) that they might otherwise have against the Company.

 

No
remedy against the Company other than as referred to in Article 5 of the Senior Indenture shall be available to the Trustee or
the Holders, whether for the recovery of amounts owing in respect of the Senior Notes or under the Indenture or in respect of
any breach by the Company of any of its other obligations under or in respect of the Senior Notes or under the Senior Indenture,
except that the Trustee and the Holders shall have such rights and powers as they are required to have under the Trust Indenture
Act.

 

Amounts
to be paid on the Senior Notes of this Series will be made without deduction or withholding for, or on account of, any and all
present and future income, stamp and other taxes, levies, imposts, duties, charges or fees, levied, collected, withheld or assessed
by or on behalf of the United Kingdom or any political subdivision or authority thereof or therein having the power to tax (the
“Taxing Jurisdiction”), unless

 

    A-7 

     

    

such
deduction or withholding is required by law. If at any time a Taxing Jurisdiction requires the Company to make such deduction
or withholding, the Company will pay additional amounts with respect to the principal of, and interest and any other payments
on, the Senior Notes of this series (“Additional Amounts”) that are necessary in order that the net amounts paid to
the Holders, after the deduction or withholding, shall equal the amounts which would have been payable on the Senior Notes if
the deduction or withholding had not been required. However, this will not apply to any such tax, levy, impost, duty, charge
or fee, which would not have been deducted or withheld but for the fact that:

 

(i)
the Holder or the Beneficial Owner of the Senior Note is a domiciliary, national or resident of, or engaging in business or maintaining
a permanent establishment or is physically present in, the Taxing Jurisdiction or otherwise has some connection with the Taxing
Jurisdiction other than the holding or ownership of a Senior Note, or the collection of any payment of (or in respect of) principal
of, or interest or other payments on, any Senior Note,

 

(ii)
except in the case of winding-up in the United Kingdom, the relevant Senior Note is presented (where presentation is required)
for payment in the United Kingdom,

 

(iii)
the relevant Senior Note is presented (where presentation is required) for payment more than 30 days after the date payment became
due or was provided for, whichever is later, except to the extent that the Holder would have been entitled to the Additional Amounts
on presenting the same for payment at the close of that 30 day period,

 

(iv)
the Holder or the Beneficial Owner of the relevant Senior Note or the Beneficial Owner of any payment of (or in respect of) principal
of, or interest or other payments on, the Senior Note failed to comply with a request of the Company or its liquidator or other
authorized person addressed to the Holder (x) to provide information concerning the nationality, residence or identity of the
Holder or such Beneficial Owner or (y) to make any declaration or other similar claim to satisfy any requirement, which in the
case of (x) or (y), is required or imposed by a statute, treaty, regulation or administrative practice of the Taxing Jurisdiction
as a precondition to exemption from all or part of the tax, levy, impost, duty, charge or fee,

 

(v)
the withholding or deduction is required to be made pursuant to European Council Directive 2003/48/EC on the taxation of savings
income, or any directive amending, supplementing or replacing such directive, or any law implementing or complying with, or introduced
in order to conform to, such directive or directives,

 

(vi)
the Senior Note is presented (where presentation is required) for payment by or on behalf of a Holder who would have been able
to avoid such withholding or deduction by presenting the Senior Note to another paying agent,

 

(vii)
the deduction or withholding is imposed by reason of any agreement with the U.S. Internal Revenue Service in connection with Sections
1471-1474 of the U.S. Internal

 

    A-8 

     

    

Revenue
Code and the U.S. Treasury regulations thereunder (“FATCA”), any intergovernmental agreement between the United States
and the United Kingdom or any other jurisdiction with respect to FATCA, or any law, regulation or other official guidance enacted
in any jurisdiction implementing, or relating to, FATCA or any intergovernmental agreement; or

 

(viii)
any combination of clauses (i) through (vii) above,

 

nor shall
Additional Amounts be paid with respect to the principal of, or any interest or other payments on, the Senior Note to any Holder
who is a fiduciary or partnership or any person other than the sole Beneficial Owner of such payment to the extent such payment
would be required by the laws of any Taxing Jurisdiction to be included in the income for tax purposes of a beneficiary or partner
or settlor with respect to such fiduciary or a member of such partnership or a Beneficial Owner who would not have been entitled
to such Additional Amounts, had it been the Holder.

 

References
herein to the payment of the principal of or interest or other payments on any Senior Note shall be deemed to include mention
of the payment of Additional Amounts provided for in the foregoing paragraph to the extent that, in such context, Additional Amounts
are, were or would be payable under the foregoing provisions.

 

The
Senior Notes of this series are redeemable, as a whole but not in part, at the option of the Company (subject to, if and to the
extent required by the Relevant Regulator or the Loss Absorption Regulations, the Company giving notice to the Relvant Regulator
and the Relevant Regulator granting the Company permission), on not less than 30 nor more than 60 days’ notice, on any Payment
Date, at a redemption price equal to 100% of the principal amount, together with accrued but unpaid interest, in respect of the
Senior Notes to the date fixed for redemption, if, at any time, the Company shall determine that as a result of a change in or
amendment to the laws or regulations of the Taxing Jurisdiction (including any treaty to which such Taxing Jurisdiction is a party),
or any change in the application or interpretation of such laws or regulations (including a decision of any court or tribunal)
which change or amendment becomes effective on or after May 8, 2018:

 

(a)
in making payment under the Senior Notes the Company has or will or would on the next Payment Date become obligated to pay Additional
Amounts;

 

(b)
the payment of interest on the next Payment Date in respect of any of the Senior Notes would be treated as a “distribution”
within the meaning of Chapter 2 of Part 23 of the Corporation Tax Act 2010 of the United Kingdom (or any statutory modification
or re-enactment thereof for the time being); or

 

(c)
on the next Payment Date the Company would not be entitled to claim a deduction in respect of such payment of interest in computing
its United Kingdom taxation liabilities (or the value of such deduction to the Company would be materially reduced).

 

    A-9 

     

    

In
any case where the Company shall determine that, in accordance with Section 11.08 of the Senior Indenture, it is entitled to redeem
the Senior Notes of this series, the Company shall be required to deliver to the Trustee prior to the giving of any notice of
redemption a written legal opinion of independent United Kingdom counsel of recognized standing (selected by the Company) in a
form satisfactory to the Trustee confirming that the relevant change or amendment has occurred and that the Company is entitled
to exercise its right of redemption.

 

The
Company may, at the Company’s option (but subject to, if and to the extent then required by the Relevant Regulator or the
Loss Absorption Regulations, the Company giving notice to the Relevant Regulator and the Relevant Regulator granting the Company
permission), having given not less than 30 nor more than 60 days’ notice to holders, redeem all but not some only of the
Senior Notes outstanding at any time at 100% of their principal amount together with any accrued but unpaid interest to the date
of redemption, if immediately prior to the giving of the notice referred to above, the Company satisfies the Trustee that a Loss
Absorption Disqualification Event has occurred. Any redemption or purchase of Senior Notes (other than redemption on the relevant
maturity date), and any modification to the terms of the Senior Notes or any indenture relating thereto, is subject to, if and
to the extent then required by the Relevant Regulator or the Loss Absorption Regulations, the Company giving notice to the Relevant
Regulator and the Relevant Regulator granting the Company permission therefor and otherwise to compliance with the Loss Absorption
Regulations if and to the extent then required thereunder.

 

If
the Company elects to redeem the Senior Notes of this series, the Senior Notes will cease to accrue interest from the date of
redemption, provided the redemption price has been paid in accordance with the Indenture.

 

Upon
payment of (i) the amount of principal (and premium, if any) so declared due and payable and (ii) accrued and unpaid interest,
all of the Company’s obligations in respect of the payment of the principal of (and premium, if any), and accrued and unpaid
interest on, the Senior Notes of this series shall terminate.

 

Notwithstanding
any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial Owner of this Senior Note,
by purchasing or acquiring this Senior Note, each Holder (including each Beneficial Owner) of this Senior Note acknowledges, accepts,
agrees to be bound by and consents to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority that may
result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on, the Senior Notes;
(ii) the conversion of all, or a portion, of the principal amount of, or interest on, the Senior Notes into shares or other securities
or other obligations of the Company or another person; and/or (iii) the amendment or alteration of the maturity of the Senior
Notes, or amendment of the amount of interest due on the Senior Notes, or the dates on which interest becomes payable, including
by suspending payment for a temporary period; which U.K. bail-in power may be exercised by means of variation of the terms of
the Senior Notes solely to give effect to the exercise by the relevant U.K. resolution authority of such U.K. bail-in power. Each
Holder and Beneficial Owner of the

 

    A-10 

     

    

Senior
Notes further acknowledges and agrees that the rights of the Holders and/or Beneficial Owners under the Senior Notes are subject
to, and will be varied, if necessary, solely to give effect to, the exercise of any U.K. bail-in power by the relevant U.K. resolution
authority.

 

By
purchasing or acquiring the Senior Notes, each Holder and Beneficial Owner of the Securities:

 

(i)
acknowledges and agrees that the exercise of the U.K. bail-in power by the relevant U.K. resolution authority in respect of the
Senior Notes shall not give rise to a default or an Event of Default for purposes of Section 315(b) (Notice of Default) and Section
315(c) (Duties of the Trustee in Case of Default) of the Trust Indenture Act;

 

(ii)
to the extent permitted by the Trust Indenture Act, waives any and all claims against the Trustee for, agrees not to initiate
a suit against the Trustee in respect of, and agrees that the Trustee shall not be liable for, any action that the Trustee takes,
or abstains from taking, in either case in accordance with the exercise of the U.K. bail-in power by the relevant U.K. resolution
authority with respect to the Senior Notes; and

 

(iii)
acknowledges and agrees that, upon the exercise of any U.K. bail-in power by the relevant U.K. resolution authority, (a) the Trustee
shall not be required to take any further directions from Holders of the Senior Notes under Section 5.12 of the Senior Indenture,
and (b) neither the Senior Indenture nor the Fifth Supplemental Indenture shall impose any duties upon the Trustee whatsoever
with respect to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority. Notwithstanding the foregoing,
if, following the completion of the exercise of the U.K. bail-in power by the relevant U.K. resolution authority, any of the Senior
Notes remain outstanding (for example, if the exercise of the U.K. bail-in power results in only a partial write-down of the principal
of the Senior Notes), then the Trustee’s duties under the Indenture shall remain applicable with respect to the Senior Notes
following such completion to the extent that the Company and the Trustee shall agree pursuant to a supplemental indenture or an
amendment to the Fifth Supplemental Indenture.

 

By
purchasing or acquiring the Senior Notes, each Holder and Beneficial Owner that acquires its Senior Notes in the secondary market
shall be deemed to acknowledge and agree to be bound by and consent to the same provisions specified in the Indenture to the same
extent as the Holders and Beneficial Owners of the Senior Notes that acquire the Senior Notes upon their initial issuance, including,
without limitation, with respect to the acknowledgement and agreement to be bound by and consent to the terms of the Senior Notes
related to the U.K. bail-in power.

 

By
purchasing or acquiring the Senior Notes, each Holder and Beneficial Owner shall be deemed to have (i) consented to the exercise
of any U.K. bail-in power as it may be imposed without any prior notice by the relevant U.K. resolution authority of its

 

    A-11 

     

    

decision
to exercise such power with respect to the Senior Notes and (ii) authorized, directed and requested DTC and any direct participant
in DTC or other intermediary through which it holds such Senior Notes to take any and all necessary action, if required, to implement
the exercise of any U.K. bail-in power with respect to the Senior Notes as it may be imposed, without any further action or direction
on the part of such Holder or Beneficial Owner or the Trustee.

 

No
repayment of the principal amount of the Senior Notes or payment of interest on the Senior Notes shall become due and payable
after the exercise of any U.K. bail-in power by the relevant U.K. resolution authority unless, at the time that such repayment
or payment, respectively, is scheduled to become due, such repayment or payment would be permitted to be made by the Company under
the laws and regulations of the United Kingdom and the European Union applicable to the Company and the Group.

 

Upon
the exercise of the U.K. bail-in power by the relevant U.K. resolution authority with respect to the Senior Notes, the Company
shall provide a written notice to DTC as soon as practicable regarding such exercise of the U.K. bail-in power for purposes of
notifying Holders of such occurrence. The Company shall also deliver a copy of such notice to the Trustee for information purposes.

 

The
Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations
of the Company and the rights of the Holders of the Senior Notes of each series to be affected thereby by the Company and the
Trustee with the consent of the Holders of not less than a majority in principal amount of the Senior Notes at the time outstanding
of each such series. The Indenture also contains provisions permitting the Holders of a majority in aggregate principal amount
of the outstanding Senior Notes of each series, on behalf of the Holders of all Senior Notes of such series, to waive compliance
by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.
Any such consent or waiver by the Holder of this Senior Note shall be conclusive and binding upon such Holder and upon all future
Holders of this Senior Note and of any Senior Note issued in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Senior Note.

 

No
reference herein to the Indenture and no provision of this Senior Note or of the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay, if and when due and payable, the principal of (and premium, if any)
and interest on, this Senior Note at the times, place and rate, and in the coin or currency, herein prescribed.

 

As
set forth in, and subject to, the provisions of the Indenture, no Holder of any Senior Note of this series will have the right
to institute any proceeding with respect to the Indenture, this Senior Note or any remedy thereunder; provided, however,
that such limitations do not apply to a suit instituted by the Holder hereof for the enforcement of payment of the principal or
interest as and when the same shall have become due and payable in accordance with the terms hereof and the Indenture.

 

    A-12 

     

    

No
reference herein to the Indenture and no provision of this Senior Note or of the Indenture shall alter or impair the right of
the Holder of this Senior Note, which is absolute and unconditional, to receive payment of the principal of (and premium, if any)
and interest on, this Senior Note when due and payable in accordance with the provisions of this Senior Note and the Indenture.

 

This
Senior Note will be governed by the laws of the State of New York.

 

Unless
otherwise defined herein, all terms used in this Senior Note which are defined in the Indenture shall have the meanings assigned
to them in the Indenture.

 

    A-13ex_112907.htm

Exhibit 10.1

 

AMENDMENT TO ASSET PURCHASE AGREEMENT 

 

This Amendment to Asset Purchase Agreement, dated as of April 2, 2018 (this “Amendment”), is between Cardinal Health 414, LLC, a Delaware limited liability company (“Buyer”), and Navidea Biopharmaceuticals, Inc., a Delaware corporation ( “Seller”), and amends that certain Asset Purchase Agreement, dated November 23, 2017 (the “Agreement”), between Buyer and Seller, as contemplated by Section 9.15 of the Agreement. Capitalized terms used but not defined in this Amendment have the meanings given to them in the Agreement.

 

Background 

 

A.     The Agreement contemplated that certain “Contingent Payments” would be paid to Seller following the Closing, subject to the terms and conditions set forth in the Agreement.

 

B.     Pursuant to (1) the Global Settlement Agreement, dated as of March 3, 2017 (“Settlement Agreement”), among Seller and its subsidiary, Macrophage Therapeutics, Inc., and Capital Royalty Partners II L.P., Capital Royalty Partners II (Cayman), L.P., Capital Royalty Partners II – Parallel Fund “A” L.P., Parallel Investment Opportunities Partners II L.P., Capital Royalty Partners II – Parallel Fund “B” (Cayman) L.P. and CRG Servicing LLC (collectively, “CRG”), and Buyer, and (2) the related Side Letter Agreement, dated March 3, 2017 (the “Side Letter”), between Seller and Buyer, Buyer issued a letter of credit to CRG in the face amount of $7,153,000 (the “Letter of Credit”).

 

C.     In exchange for eliminating the obligation of Buyer to make any further Contingent Payments, the Parties have agreed that Buyer will make payments of $13,093,099.78 in the aggregate on the terms and conditions set forth in this Agreement.

 

NOW, THEREFORE, in consideration of the foregoing, and of their mutual agreements and representations contained herein and in the Agreement, and intending to be legally bound, the Parties agree as follows:

 

ARTICLE I

AMENDMENTS & SUPPLEMENTS 

 

1.1 Consideration. In consideration for the amendments contemplated in Section 1.2 and 1.3 of this Amendment:

 

(a)     promptly following the execution of this Amendment, Buyer will pay to Seller an aggregate amount equal to $5,940,099.78 (the “Additional Payment”); and

 

(b)     promptly after the earlier of (i) the expiration of the Letter of Credit and (ii) the receipt by Buyer of evidence of the return and cancellation of the Letter of Credit, Buyer will pay to Seller an amount in cash by wire transfer of immediately available funds pursuant to instructions delivered to Buyer by Seller that is equal to the unused portion of the Letter of Credit (such amount not to exceed $7,153,000). For the avoidance of doubt, Buyer is not obligated to take any actions or expend any efforts to maximize the amounts payable to Seller under this Section 1.1(b).

 

 

 

 

Notwithstanding anything to the contrary herein, Seller confirms its obligations to indemnify the Buyer Indemnitees under the Side Letter from and against any and all Losses they may suffer, sustain or become subject to, arising out of, in connection with or resulting from any claims or demands made by or on behalf of, or Actions involving, CRG or the Letter of Credit (excluding any actual draw on the Letter of Credit by CRG). Seller further agrees that Buyer may offset (a) any indemnification obligations of Seller under the Agreement or any of the other Transaction Documents against (b) any and all amounts due or to become due to Seller under the Agreement, any of the other Transaction Documents or otherwise, including against any amount payable pursuant to Section 1.1(b) above, any Earnout Payments or in connection with exercise of the Warrant. The Parties acknowledge that $59,900.22 of Losses that are currently owed by Seller to Buyer on account of Seller’s existing indemnification claims are deemed satisfied as of the date hereof, and Seller owes no payment to Buyer to satisfy such amount due.

 

1.2     Elimination of Contingent Payments. Effective as of the date of this Amendment, the Agreement is hereby amended as follows:

 

(a)     Section 2.10(a) of the Agreement is hereby deleted in its entirety and replaced with “[RESERVED].”

 

(b)     Section 2.10(f) of the Agreement is hereby deleted in its entirety and replaced with the following:

 

“Within 45 days following the end of each Fiscal Year of the Contingent Payment Period, Buyer shall deliver to Seller a reasonably detailed accounting of the Annual Sales for the Fiscal Year (each, a “Milestone Payment Statement”).”

 

1.3      Amendments to Defined Terms. Effective as of the date of this Amendment, Section 1.1 of the Agreement is hereby amended as follows:

 

(a)     The term “Catch-up Contingent Payment” and its related definition are hereby deleted in their entirety.

 

(b)     The definition of “Contingent Payments” is hereby amended and restated in its entirety as follows: “‘Contingent Payments’ means those certain payments made by Buyer to Seller prior to April 2, 2018 in an amount equal to eight percent of the Annual Sales.”

 

(c)     The definition of “Contingent Payment Period” is hereby amended and restated in its entirety as follows: “‘Contingent Payment Period’ means the period beginning on the Closing Date and ending on June 30, 2026.”

 

(d)     The definition of “Purchase Price” is hereby amended and restated in its entirety as follows: “‘Purchase Price’ means the Closing Purchase Price plus the Earnout Payment (to the extent paid or payable pursuant to Section 2.10), plus the Additional Payment contemplated by that certain Amendment to Asset Purchase Agreement, dated as of April 2, 2018.”

 

-2-

 

 

ARTICLE II

MISCELLANEOUS

 

2.1      Effect of Amendment. Except as and to the extent expressly modified by this Amendment, the Agreement, as so amended by this Amendment, will remain in full force and effect in all respects. Each reference to “hereof,” “herein,” “hereby,” and “this Agreement” in the Agreement will from and after the effective date hereof refer to the Agreement as amended by this Amendment.

 

2.2      Integration. This Amendment, together with the Agreement and the documents executed pursuant thereto, supersede all negotiations, agreements and understandings among the Parties with respect to the subject matter hereof (except for the Confidentiality Agreement) and constitute the entire agreement between the Parties with respect thereto.

 

2.3      Governing Law; Jurisdiction; Waiver of Jury Trial. Sections 9.5 and 9.13, in each case, of the Agreement are incorporated into this Amendment by reference as if fully set forth herein, mutatis mutandis.

 

2.4      Notices. All notices and other communications hereunder will be in writing and sent pursuant to the requirements of Section 9.1 of the Agreement.

 

2.5      Titles and Headings. The titles and captions in this Amendment are for reference purposes only, and will not in any way define, limit, extend or describe the scope of this Amendment or otherwise affect the meaning or interpretation of this Amendment.

 

2.7      Counterparts. This Amendment may be executed in two or more counterparts for the convenience of the Parties, each of which will be deemed an original and all of which together will constitute one and the same instrument. Delivery of an executed counterpart of a signature page to this Agreement by facsimile or portable document format will be effective as delivery of a manually executed counterpart to this Agreement.

 

2.8      Representations and Warranties. Each Party represents and warrants to the other Party that: (a) it is duly authorized to execute and deliver this Amendment, and this Amendment and the transactions contemplated hereby have been duly authorized by all necessary action of such Party; (b) the performance by such Party of its obligations under this Amendment do not: (i) conflict with any contract or agreement binding upon such Party or its properties or (ii) violate or conflict with any order or decree binding upon such Party or its properties; (c) such Party has obtained all consents and approvals necessary for it to enter into and perform its obligations under this Amendment; and (d) this Amendment is enforceable against such Party in accordance with its terms (except as enforcement may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar laws relating to or limiting creditors’ rights generally or by equitable principles relating to enforceability).

 

[Signature page follows.]

 

-3-

 

 

IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed as of the day and year first written above.

 

 

 

	
			 

				
			BUYER:

				
			 

			
	 	 	 
	 	CARDINAL HEALTH 414, LLC	 
	
			 

				
			 

				
			 

				
			 

			
	 	 	 	 
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By: 

				
			  /s/ Jorge Gomez

				
			 

			
	 	 	 
	
			 

				
			Name: Jorge Gomez

				
			 

			
	 	 	 
	 	Title: Chief Financial Officer	 

 

 

 

 

IN WITNESS WHEREOF, the Parties have caused this Amendment to be executed as of the day and year first written above.

 

 

 

	
			 

				
			SELLER:

				
			 

			
	 	 	 
	 	
			NAVIDEA BIOPHARMACEUTICALS, INC.

				 
	
			 

				
			 

				
			 

				
			 

			
	 	 	 	 
	
			 

				
			 

				
			 

				
			 

			
	
			 

				
			By: 

				
			  /s/ Jed Latkin

				
			 

			
	 	 	 
	
			 

				
			Name: Jed Latkin

				
			 

			
	 	 	 
	 	Title: CFO & COO

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