Document:

form10q_090309exh2.htm

 

EXHIBIT 10.3

 

PROMISSORY NOTE

 

	
Principal

$5,000,000.00
	
Loan Date

08-13-2009
	
Maturity

02-13-2010
	
Loan No

2000206013
	
Account

309275

	
Borrower:
	
ELECSYS CORPORATION

ELECSYS INTERNATIONAL CORPORATION

846 N. MARTWAY COURT

OLATHE, KS 66061
	  	
Lender:
	
Bank Midwest N.A.

Town Pavilion Facility

1111 Main Street

Kansas City, MO 64105

	
Principal Amount:  $5,000,000.00
	  	
Date of Note:  August 13, 2009

PROMISE TO PAY. ELECSYS CORPORATION and ELECSYS INTERNATIONAL CORPORATION (“Borrower”) jointly and severally promise to pay to Bank Midwest N.A. (“Lender”), or order, in lawful money of the United States of America, the principal amount of Five Million &
00/100 Dollars ($5,000,000.00) or so much as may be outstanding, together with interest on the unpaid outstanding principal balance of each advance.  Interest shall be calculated from the date of each advance until repayment of each advance.

 

PAYMENT.  Borrower will pay this loan in one payment of all outstanding principal plus all accrued unpaid interest on February 13, 2010.  In addition, Borrower will pay regular monthly payments of all accrued unpaid interest due as of each payment date, beginning
September 13, 2009, with all subsequent interest payments to be due on the same day of each month after that.  Unless otherwise agreed or required by applicable law, payments will be applied first to any accrued unpaid interest; then to principal; then to any unpaid collection costs; and then to any late charges.  Borrower will pay lender at lender’s address shown above or at such other place as lender may designate in writing.

 

VARIABLE INTEREST RATE.  The interest rate on this Note is subject to change from time to time based on changes in an independent index which is the Wall Street Journal Prime Rate.  That is the base rate on corporate loans posted by at least 75% of the nations 30
largest banks on the rate adjustment date (the “Index”).  The Index is not necessarily the lowest rate charged by Lender on its loans.  If the Index becomes unavailable during the term of this loan, Lender may designate a substitute index after notifying Borrower.  Lender will tell Borrower the current Index rate upon Borrower’s request.  The interest rate change will not occur more often than each day.  Borrower understands that Lender may make
loans based on other rates as well.  The Index currently is 3.250% per annum.  Interest on the unpaid principal balance of this Note will be calculated as described in the “INTEREST CALCULATION METHOD” paragraph using a rate equal to the Index, adjusted if necessary for any minimum and maximum rate limitations described below, resulting in an initial rate of 5.500% per annum based on a year of 360 days.

 

NOTICE:  Under no circumstances will the interest rate on this Note be less than 5.500% per annum or more than the maximum rate allowed by applicable law.

 

INTEREST CALCULATION METHOD.  Interest on this Note is computed on a 365/360 basis; that is, by applying the ratio of the interest rate over a year of 360 days, multiplied by the outstanding principal balance, multiplied
by the actual number of days the principal balance is outstanding.  All interest payable under this Note is computed using this method.

 

  

  

  

PREPAYMENT.  Borrower agrees that all loan fees and other prepaid finance charges are earned fully as of the date of the loan and will not be subject to refund upon early payment (whether voluntary or as a result of default), except as otherwise required by law.  Except
for the foregoing, Borrower may pay without penalty all or a portion of the amount owed earlier than it is due.  Early payments will not, unless agreed to by Lender in writing, relieve Borrower of Borrower’s obligation to continue to make payments of accrued unpaid interest.  Rather, early payments will reduce the principal balance due.  Borrower agrees not to send Lender payments marked “paid in full”, “without recourse”, or similar language.  If
Borrower sends such a payment, Lender may accept it without losing any of Lender’s rights under this Note, and Borrower will remain obligated to pay any further amount owed to Lender.  All written communications concerning disputed amounts, including any check or other payment instrument that indicates that the payment constitutes “payment in full” of the amount owed or that is tendered with other conditions or limitations or as full satisfaction of a disputed amount must be mailed
or delivered to:  Bank Midwest N.A., Town Pavilion Facility, 1111 Main Street, Kansas City, MO 64105.

 

LATE CHARGE.  If a payment is more than 10 days late, Borrower will be charged 5.000% of the unpaid portion of the regularly scheduled payment.

 

INTEREST AFTER DEFAULT.  Upon default, including failure to pay upon final maturity, the interest rate on this Note shall be increased by adding a 5.000 percentage point margin (“Default Rate Margin”).  The Default Rate Margin shall also apply to each
succeeding interest rate change that would have applied had there been no default.  However, in no event will the interest rate exceed the maximum interest rate limitations under applicable law.

 

DEFAULT.  Each of the following shall constitute an event of default (“Event of Default”) under this Note:

 

Payment Default.  Borrower fails to make any payment when due under this Note.

 

Other Defaults.  Borrower fails to comply with or to perform any other term, obligation, covenant or condition contained in this Note or in any of the related documents or to comply with or to perform any term, obligation, covenant or condition contained in any other agreement
between Lender and Borrower.

 

Default in Favor of Third Parties.  Borrower or any Grantor defaults under any loan, extension of credit, security agreement, purchase or sales agreement, or any other agreement, in favor of any other creditor or person that may materially affect any of Borrower’s
property or Borrower’s ability to repay this Note or perform Borrower’s obligations under this Note or any of the related documents.

 

False Statements.  Any warranty, representation or statement made or furnished to Lender by Borrower or on Borrower’s behalf under this Note or the related documents is false or misleading in any material respect, either now or at the time made or furnished or becomes
false or misleading at any time thereafter.

 

Insolvency.  The dissolution or termination of Borrower’s existence as a going business, the insolvency of Borrower, the appointment of a receiver for any part of Borrower’s property, any assignment for the benefit of creditors, any type of creditor workout,
or the commencement of any proceeding under any bankruptcy or insolvency laws by or against Borrower.

 

  

2

  

Creditor or Forfeiture Proceedings.  Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding, self-help, repossession or any other method, by any creditor of Borrower or by any governmental agency against any collateral securing the loan.

 

This includes a garnishment of any of Borrower’s accounts, including deposit accounts, with Lender.  However, this Event of Default shall not apply if there is a good faith dispute by Borrower as to the validity or reasonableness of the claim which is the basis of the creditor or forfeiture proceeding and if Borrower gives
Lender written notice of the creditor or forfeiture proceeding and deposits with Lender monies or a surety bond for the creditor or forfeiture proceeding, in an amount determined by Lender, in its sole discretion, as being an adequate reserve or bond for the dispute.

 

Events Affecting Guarantor.  Any of the preceding events occurs with respect to any guarantor, endorser, surety, or accommodation party of any of the indebtedness or any guarantor, endorser, surety, or accommodation party dies or becomes incompetent, or revokes or disputes
the validity of, or liability under, any guaranty of the indebtedness evidenced by this Note.

 

Change In Ownership.  Any change in ownership of twenty-five percent (25%) or more of the common stock of Borrower.

 

Adverse Change.  A material adverse change occurs in Borrower’s financial condition, or Lender believes the prospect of payment or performance of this Note is impaired.

 

Cure Provisions.  If any default, other than a default in payment is curable and if Borrower has not been given a notice of a breach of the same provision of this Note within the preceding twelve (12) months, it may be cured if Borrower, after Lender sends written notice
to Borrower demanding cure of such default:  (1) cures the default within ten (10) days; or (2) if the cure requires more than ten (10) days, immediately initiates steps which Lender deems in Lender’s sole discretion to be sufficient to cure the default and thereafter continues and completes all reasonable and necessary steps sufficient to produce compliance as soon as reasonably practical.

 

LENDER’S RIGHTS.  Upon default, Lender may declare the entire unpaid principal balance under this Note and all accrued unpaid interest immediately due, and then Borrower will pay that amount.

 

ATTORNEYS’ FEES; EXPENSES.  Lender may hire or pay someone else to help collect this Note if Borrower does not pay.  Borrower will pay Lender that amount.  This includes, subject to any limits under applicable law, Lender’s attorneys’
fees and Lender’s legal expenses whether or not there is a lawsuit, including attorneys’ fees and expenses for bankruptcy proceedings (including efforts to modify or vacate any automatic stay or injunction), and appeals.  If not prohibited by applicable law, Borrower also will pay any court costs, in addition to all other sums provided by law.

 

GOVERNING LAW.  This Note will be governed by federal law applicable to Lender and, to the extent not preempted by federal law, the laws of the State of Missouri without regard to its conflicts of law provisions.  This Note has been accepted by Lender in the State
of Missouri.

 

CHOICE OF VENUE.  If there is a lawsuit, Borrower agrees upon Lender’s request to submit to the jurisdiction of the courts of Jackson County, State of Missouri.

 

DISHONORED ITEM FEE.  Borrower will pay a fee to Lender of $15.00 if Borrower makes a payment on Borrower’s loan and the check or preauthorized charge with which Borrower pays is later dishonored.

 

  

3

  

RIGHT OF SETOFF.  To the extent permitted by applicable law, Lender reserves a right of setoff in all Borrower’s accounts with Lender (whether checking, savings, or some other account).  This includes all accounts Borrower holds jointly with someone else and
all accounts Borrower may open in the future.  However, this does not include any IRA or Keogh accounts, or any trust accounts for which setoff would be prohibited by law.  Borrower authorizes Lender, to the extent permitted by applicable law, to charge or setoff all sums owing on the indebtedness against any and all such accounts.

 

COLLATERAL.  Borrower acknowledges this Note is secured by A COMMERCIAL SECURITY AGREEMENT DATED AUGUST 13, 2009.

 

LINE OF CREDIT.  This Note evidences a revolving line of credit.  Advances under this Note may be requested orally by Borrower or as provided in this paragraph.  All oral requests shall be confirmed in writing on the day of the request.  All
communications, instructions, or directions by telephone or otherwise to Lender are to be directed to Lender’s office shown above.  The following person or persons are authorized, except as provided in this paragraph, to request advances and authorize payments under the line of credit until Lender receives from Borrower, at Lender’s address shown above, written notice of revocation of such authority:  KARL B. GEMPERLI, President & CEO of ELECSYS CORPORATION and President &
CEO of ELECYSY INTERNATIONAL CORPORATION; and TODD A. DANIELS, VP, CFO & Secretary of ELECSYS CORPORATION and CFO of ELECSYS INTERNATIONAL CORPORATION.  FUNDS ARE TO BE DISBURSED AT BORROWER’S REQUEST AND LOAN OFFICER’S APPROVAL.  Borrower agrees to be liable for all sums either:  (A) advanced in accordance with the instructions of an authorized person or (S) credited to any of Borrower’s accounts with Lender.  The unpaid principal balance owing on
this Note at any time may be evidenced by endorsements on this Note or by Lender’s internal records, including daily computer print-outs.  Lender will have no obligation to advance funds under this Note if:  (A) Borrower or any guarantor is in default under the terms of this Note or any agreement that Borrower or any guarantor has with Lender, including any agreement made in connection with the signing of this Note; (B) Borrower or any guarantor ceases doing business or is insolvent;
(C) any guarantor seeks, claims or otherwise attempts to limit, modify or revoke such guarantor’s guarantee of this Note or any other loan with Lender; or (D) Borrower has applied funds provided pursuant to this Note for purposes other than those authorized by Lender.

 

PRIOR NOTE.  This Promissory Note replaces and supersedes a certain Promissory Note dated August 14, 2008 in the original principal amount of $6,000,000.00, payable to Bank Midwest, N. A., as the same may have been modified and amended.  This Note represents
the same indebtedness owed under the original Note.  The parties intend that the indebtedness evidenced by this Note shall continue to be secured by the Loan documents originally executed and delivered as security for the original Note according to the same perfection priority.  Nothing contained herein is intended to adversely affect the priority or enforceability of any Lien or security interest previously granted.

 

SUCCESSOR INTERESTS.  The terms of this Note shall be binding upon Borrower, and upon Borrower’s heirs, personal representatives, successors and assigns, and shall inure to the benefit of Lender and its successors and assigns.

 

GENERAL PROVISIONS.  If any part of this Note cannot be enforced, this fact will not affect the rest of the Note.  Lender may delay or forgo enforcing any of its rights or remedies under this Note without losing them.  Each Borrower understands and agrees
that, with or without notice to Borrower, Lender may with respect to any other Borrower (a) make one or more additional secured or unsecured loans or otherwise extend additional credit; (b) alter, compromise, renew, extend, accelerate, or otherwise change one or more times the time for payment or other terms of any indebtedness, including increases and decreases of the rate of interest on the indebtedness; (c) exchange, enforce, waive, subordinate, fail or decide not to perfect, and release any security, with
or without the substitution of new collateral; (d) apply

 

  

4

  

such security and direct the order or manner of sale thereof, including without limitation, any non-judicial sale permitted by the terms of the controlling security agreements, as Lender in its discretion may determine; (e) release, substitute, agree not to sue, or deal with
anyone or more of Borrower’s sureties, endorsers, or other guarantors on any terms or in any manner Lender may choose; and (f) determine how, when and what application of payments and credits shall be made on any other indebtedness owing by such other Borrower.  Borrower and any other person who signs, guarantees or endorses this Note, to the extent allowed by law, waive presentment, demand for payment, and notice of dishonor.  Upon any change in the terms of this Note, and unless otherwise
expressly stated in writing, no party who signs this Note, whether as maker, guarantor, accommodation maker or endorser, shall be released from liability.  All such parties agree that Lender may renew or extend (repeatedly and for any length of time) this loan or release any party or guarantor or collateral; or impair, fail to realize upon or perfect Lender’s security interest in the collateral; and take any other action deemed necessary by Lender without the consent of or notice to anyone.  All
such parties also agree that Lender may modify this loan without the consent of or notice to anyone other than the party with whom the modification is made.  The obligations under this Note are joint and several.

 

ORAL AGREEMENTS OR COMMITMENTS TO LOAN MONEY, EXTEND CREDIT OR TO FOREBEAR FROM ENFORCING REPAYMENT OF A DEBT INCLUDING PROMISES TO EXTEND OR RENEW SUCH DEBT ARE NOT ENFORCEABLE, REGARDLESS OF THE LEGAL THEORY UPON WHICH IT IS BASED THAT IS IN ANY WAY RELATED TO THE CREDIT AGREEMENT.  TO PROTECT YOU (BORROWER(S))
AND US (CREDITOR) FROM MISUNDERSTANDING OR DISAPPOINTMENT, ANY AGREEMENTS WE REACH COVERING SUCH MATTERS ARE CONTAINED IN THIS WRITING, WHICH IS THE COMPLETE AND EXCLUSIVE STATEMENT OF THE AGREEMENT BETWEEN US, EXCEPT AS WE MAY LATER AGREE IN WRITING TO MODIFY IT.

 

JURY WAIVER.  Lender and Borrower hereby waive the right to any jury trial in any action, proceeding, or counterclaim brought by either Lender or Borrower against the other.

 

PRIOR TO SIGNING THIS NOTE, EACH BORROWER READ AND UNDERSTOOD ALL THE PROVISIONS OF THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS.  EACH BORROWER AGREES TO THE TERMS OF THE NOTE.

 

BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.

 

BORROWER:

 

ELECSYS CORPORATION

By: ______________________________________________                                                                                    

KARL B. GEMPERLI, President & CEO of ELECSYS

CORPORATION

ELECSYS INTERNATIONAL CORPORATION

By: ______________________________________________                                                                                    

KARL B. GEMPERLI, President & CEO of ELECSYS

INTERNATIONAL CORPORATION

  

5EXHIBIT
4.23

     

    The Commissioners of Her
Majesty’s Treasury (the “Treasury”)

    1 Horse Guards Road

    London

    SW1A 2HQ

    

    The Secretary of State, Department for
Business, Enterprise and Regulatory Reform (“BERR”)

    1 Victoria Street

    London 

    SW1H 0ET

    

    The Secretary of State, Department for
Communities and Local Government (“DCLG”) 

    Eland House

    Bressenden Place

    London

    SW1E 5DU

    

    

    February 2009

    

    

    

    

    Ladies and
Gentlemen,

    

    LENDING COMMITMENTS

    

    
      	
              1.

            	
              Introduction

            

    

    

    The Royal Bank of Scotland plc (the
“Participating
Institution”) notes
that:

    

    
      	
              (A)

            	
              the Asset Protection Scheme (the
      “APS”) and the extension to the Credit
      Guarantee Scheme (the “CGS” and, together with the APS, the
      “Schemes”) announced by the Government on
      19 January 2009 are part of a comprehensive package of measures the
      objective of which is to reinforce the stability of the financial system, and together
      with the Working Capital Scheme announced by the Government on 14 January
      2009 (the “WCS”), to increase confidence and
      capacity to lend, and in turn to support the recovery of the
      economy;

            

    

    

    
      	
              (B)

            	
              participation in either
      or both of the
      Schemes by an institution having eligible liabilities (as determined by
      the Bank of England) above a threshold to be specified by the Treasury is
      subject to a verifiable commitment to be agreed between each participating
      institution and the Government to support lending to
      creditworthy borrowers in the real economy in a commercial manner;
      and

            

    

    

    
      	
              (C)

            	
              in determining the requisite
      lending commitments, the Treasury, BERR and DCLG (together, the
      “Government
      Departments”) have
      consulted closely with each other in relation to sectors
      of the economy for which they have responsibilities, and will continue to
      consult closely with each other as appropriate in relation to the
      implementation and

            

    

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    operation of the lending commitments
given or to be given by certain institutions which participate in either or both
of the Schemes.

    

    In connection with the
above, this document is being entered into by the Participating Institution by
way of a deed poll in favour of the
Government Departments and specifies: (i) the lending commitments given by the
Participating Institution for itself and on behalf of its Group, in connection
with its proposed participation in the Schemes, comprising a Business Lending
Commitments and a
Homeowner Lending Commitment (each as defined in paragraph  
3(A) and together, the
“Lending
Commitments”); and (ii) certain
associated undertakings being given by the Participating Institution in
connection with the implementation and
operation of the Lending Commitments.

    

    The Participating Institution agrees
that the undertakings given in this Deed Poll (including the Lending
Commitments) are intended to be binding on it and the provision of such
undertakings is a pre-requisite to the Participating
Institution’s proposed participation in the
Schemes.

    

    References in this Deed Poll to the
“Participating
Institution” mean (where
appropriate) the Participating Institution and the members of the Participating
Institution’s Group forming part of its UK banking operations.

    

    
      	
              2.

            	
              Commencement of
      Lending Commitments

            

    

    

    The Participating Institution undertakes
(for itself and on behalf of its Group) to implement the Lending Commitments
with effect from 1 March 2009 and in doing so, to act in good faith, having
regard to the purpose of the Lending Commitments to support lending to creditworthy borrowers in the
real economy in a commercial manner.

    

    
      	
              3.

            	
              The Lending
      Commitments: General

            

    

    

    The Participating Institution
undertakes:

    

    
      	
              (A)

            	
              to increase the supply of lending
      by the UK banking operations of the
      Participating Institution to UK businesses (as further described
      in paragraph   4 below) (the “Business Lending
      Commitments”) and to
      homeowners (including first time buyers) (as further described in
      paragraph   5 below) (the “Homeowner Lending
      Commitment”);
      and

            

    

    

    
      	
              (B)

            	
              to implement the Business Lending
      Commitments and the Homeowner Lending Commitment without distortion to its
      continued lending activities to other sectors of the real economy
      (including unsecured consumer lending) in the UK and, in doing so, to pay
      due regard to the level of demand and the normal distribution of
      maturities of lending to other sectors of the real economy granted by the
      Participating Institution in
2008.

            

    

    

    Notwithstanding the foregoing, the
Participating Institution
notes that the Lending Commitments are not intended to require or cause the
Participating Institution to do anything that would constitute a breach by it of
the Financial Services and Markets Act 2000 (“FSMA”), the rules made by the
Financial Services Authority (“FSA”) or the FSA’s capital supervisory
framework

     

    
      
        
        

      

      
        2

        
          

        

      

      
        
        

      

    

     

    (together, the “FSA Requirements”), to lend in excess of its single name
or sectoral risk concentration limits or otherwise to engage in uncommercial
practices.

    

    In implementing the Lending Commitments,
the Participating Institution will adhere to Principle 6 of the FSA’s Principles for Business (“a firm must pay due regard to the
interests of its customers and treat them fairly”) in respect of its lending
activities.

    

    In complying with: (i)
the Business Lending Commitments, additional lending will be subject to the
Participating Institution’s ordinary course
pricing and other terms and commercial and risk assessment; and (ii) the
Homeowner Lending Commitment, additional residential mortgage lending will be
subject to the Participating Institution’s ordinary course
pricing and other terms and, subject to
paragraph  
5.4(B), to the Participating
Institution’s standard credit and
other acceptance criteria.

    

    
      	
              4.

            	
              The Business
      Lending Commitments

            

    

    

    
      	
              4.1

            	
              Scope of Business
      Lending Commitments

            

    

    

    The Business Lending Commitments apply
to lending by the UK banking operations of the Participating
Institution to the following UK business categories (each, a
“Relevant Business
Category” and together,
“Relevant
Businesses”):

    

    
      	
              (A)

            	
              small and medium sized enterprises (or “SMEs”), which means UK businesses which
      are categorised by the Participating Institution as being small or medium
      sized enterprises by reference to their turnover typically being
      £25 million or
      less;

            

    

    

    
      	
              (B)

            	
              “Mid-Corporates”, which means UK businesses which are categorised
      by the Participating Institution as being mid-corporates by reference to
      their turnover typically being £500 million or less, excluding
      SMEs; and

            

    

    

    
      	
              (C)

            	
              “Large Corporates”, which means UK businesses which are categorised
      by the Participating
      Institution as being large corporates by reference to their turnover
      typically being more than £500
  million.

            

    

    

    For the purposes of this Deed Poll: (i)
“UK businesses” refers to firms, companies,
partnerships, joint ventures, associations and other undertakings engaged in
economic activity in the UK (including subsidiaries and branches of overseas
entities conducting such economic activities); and (ii) “turnover” refers to the relevant UK business’s turnover, as stated in its most recent
annual accounts.

    

    
      	
              4.2

            	
              Baseline for
      determining compliance with Business Lending
      Commitments

            

    

    

    The Participating Institution
undertakes:

    

    
      	
              (A)

            	
              in respect of the 12 month period
      commencing 1 March 2009 (the “2009 commitment
      period”) and the 12
      month period commencing 1 March 2010 (the “2010 commitment
      period”), to increase
      lending (as defined in paragraph   4.9) above the lending
    figure

            

    

     

    
      
        
        

      

      
        3

        
          

        

      

      
        
        

      

    

     

    specified in the
baseline budget by the amounts specified in paragraphs  
4.3 to  
4.8 inclusive;
and

    

    
      	
              (B)

            	
              to implement the Business Lending
      Commitments in line with demand from different industry sectors operating
      in the real economy and, subject to demand, in line with the normal
      distribution of maturities of loans to each Relevant Business Category, in
      each case granted by the Participating
      Institution in 2008.

            

    

    

    For the purposes of this Deed Poll, the
“baseline
budget” means the
Participating Institution’s forecast as at 31 December 2009
(before the impact of the Lending Commitments) that the Participating
Institution has shared with
the Government Departments (a copy of which is attached as an Appendix to this
Deed Poll).

    

    
      	
              4.3

            	
              Aggregate
      Business Lending Commitment

            

    

    

    In respect of the 2009
commitment period, the Participating Institution undertakes to
increase
its lending to Relevant Businesses by, in aggregate, an additional £16 (sixteen) billion
above the amount shown in the baseline budget. In satisfying this aggregate
lending commitment, the Participating Institution shall increase its lending to
each Relevant Business Category
by (at a minimum) the amount specified in paragraphs  
4.4 to  
4.6 inclusive.

    

    
      	
              4.4

            	
              SMEs: 2009
      commitment

            

    

    

    The Participating Institution undertakes
that, in respect of the 2009 commitment period, its lending to SMEs will be at
least *** above the amount shown in the baseline budget.

    

    
      	
              4.5

            	
              Mid-Corporates:
      2009 commitment

            

    

    

    The Participating
Institution undertakes that, in respect of the
2009 commitment period, its lending to Mid-Corporates will be at
least   *** above the amount shown
in the baseline budget.

    

    
      	
              4.6

            	
              Large Corporates:
      2009 commitment

            

    

    

    The Participating Institution undertakes
that, in respect of the 2009 commitment period, its lending to Large Corporates
will be at least *** above the amount shown in the baseline
budget.

    

    The Participating Institution will work
constructively by: (i) participating in forums established or
supported by the Government or the Bank of England; (ii) working with the
Government and the Bank of England to develop guidelines for lenders; and (iii)
continuing its ordinary course activities and processes (including with respect to the syndication of
facilities), to address or reduce any risk concentrations arising from this
Business Lending Commitment.

    

     

     

      
        

      

    

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

     

    
      
        
        

      

      
        4

        
          

        

      

      
        
        

      

    

     

    
      	
              4.7

            	
              Inter-relationship
      between WCS and Business Lending
  Commitments

            

    

    

    The Participating Institution has
agreed to participate in
the WCS and undertakes that the capital released by its participation in the
Scheme will be redeployed in support of lending to

    

    SMEs and Mid-Corporates
for all forms of finance. This release of capital will enable the
Participating Institution to provide
*** of
the   *** increase in lending to
SMEs and Mid-Corporates referred to in paragraphs  
4.4 and  
4.5 above and, as such, the
Participating Institution notes that the
commitment given in respect of capital released by its participation in the WCS:
(i) is incorporated within the Business Lending Commitment for the Relevant
Business Categories; and (ii) will be subject to the monitoring, reporting and
compliance arrangements
described in paragraphs   8,  
9 and  
11.

    

    
      	
              4.8

            	
              Lending to
      business: 2010 commitment

            

    

    

    In respect of the 2010
commitment period, the Participating Institution undertakes to maintain similar
levels of lending to each of the Relevant Business Categories as in the 2009
commitment period, subject to adjustment of the commitments (pursuant to
paragraph  
6) by agreement with the
Treasury and BERR to reflect circumstances at the start of the 2010 commitment
period.

    

    
      	
              4.9

            	
              Application of
      Business Lending Commitments

            

    

    

    For the purpose of the Business Lending
Commitments “lending” means financing
facilities:

    

    
      	
              (A)

            	
              in respect of SMEs and
      Mid-Corporates, drawn; and

            

    

    

    
      	
              (B)

            	
              in respect of Large Corporates,
      granted (whether drawn or
undrawn),

            

    

    

    in each case by or to real economy UK
businesses, including
(without limitation) loans, overdrafts, asset finance, invoice discounting and
export finance, but excluding (without limitation) derivatives and interbank
financing and which are outstanding as at the end of the 2009 commitment period
or the 2010 commitment period (as
appropriate).

    

     

     

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

    

    
      
        
        

      

      
        5

        
          

        

      

      
        
        

      

    

     

    For the purposes of the above: (i) debt
which is exchanged for equity in a restructuring of a borrower, and impairments
and write-offs of outstanding lending (save to the extent such impairments and
write-offs are already reflected in the baseline budget), shall be treated as if it was still
lending, except to the extent that such adjustments to the quantum of
outstanding lending are recovered or recoverable through the APS; and (ii) debt
which is repaid by a borrower as a consequence of that borrower raising capital through other means,
including (without limitation) through disposals, equity issuance and bond
issuance shall be treated as if it was still lending.

    

    
      	
              4.10

            	
              Marketing relating to Business
      Lending Commitments

            

    

    

    The Participating Institution
undertakes that it will
promptly ensure that its staff are aware of the Business Lending Commitments and
actively seek to implement such commitments through sales and marketing
activities which are targeted at Relevant Businesses, which shall include both
existing borrowers and new potential
borrowers. These activities will make specific provision for UK businesses that
would be categorised by the Participating Institution as Mid- Corporates or
Large Corporates and whose borrowings were financed, or are financed, by financial institutions that have
reduced, or are in the process of, reducing their lending activities to UK
businesses.

    

    
      	
              4.11

            	
              General provisions about lending
      to business

            

    

    

    In relation to lending to Relevant
Businesses, the Participating Institution will:

    

    
      	
              (A)

            	
              commit to its lending allocation
      under the Enterprise Finance
Guarantee;

            

    

    

    
      	
              (B)

            	
              apply for and, if approved, use
      the European Investment Bank’s intermediated financing schemes
      aimed specifically at SMEs and “Midcaps” (as defined by the European
      Investment Bank);

            

    

    

    
      	
              (C)

            	
              actively and constructively
      participate in the funding of UK export credits where such funding
      is subject to the Export Credits Guarantee Department guarantee
      arrangements;

            

    

    

    
      	
              (D)

            	
              abide by the revised British Bankers’ Association statement of
      principles for small business lending released on 12 December 2008 (as
      agreed at the Small Business Finance Forum held on 11 November
      2008);

            

    

     

    
      
        	
                (E)

              	
                
                  not reduce or withdraw, or
      increase its charges on, working capital lines when credit insurance
      covering the borrower’s suppliers has been reduced or
      withdrawn, without due and careful consideration and unless it is
      satisfied, through the application of its ordinary course commercial and
      risk assessment, that there has been a material adverse change in
      the credit risk associated with the relevant business that justifies such
      an action;

                

              

      

       

    

    
      	
              (F)

            	
              continue to apply the normal
      commercial practices in effect prior to 2008 in determining whether to
      call a default against a business to which it has made a loan;
      and

            

    

    

    
      
        
        

      

      
        6

        
          

        

      

      
        
        

      

    

     

    
      	
              (G)

            	
              work constructively with other
      lenders and, where appropriate, the Government in exploring the full range
      of restructuring possibilities for corporate borrowers, and to do so in
      compliance with the International Association of Restructuring, Insolvency
      and Bankruptcy
      Professionals’ (INSOL) “Statement of Principles for a
      Global Approach to Multi-creditor Workouts”.

            

    

    

    The Participating Institution notes that
it has already committed to funding of £6.25 million to be made available
through the Capital for Enterprise Fund (announced by BERR on 14
January 2009), which is a fund being established to provide long term finance
for businesses which have exhausted their normal lending facilities and which is
part of Government's commitment to support the de-leveraging of over-leveraged
businesses.

    

    
      	
              5.

            	
              Homeowner Lending
      Commitment

            

    

    

    
      	
              5.1

            	
              Scope of
      Homeowner Lending Commitment

            

    

    

    The Homeowner Lending Commitment applies
to residential mortgage lending by the UK banking operations of the Participating
Institution to homeowners, including first time buyers, in respect of properties
in the UK.

    

    
      	
              5.2

            	
              Homeowner Lending
      Commitment: 2009 commitment

            

    

    

    The Participating Institution undertakes
that, in respect of the 2009 commitment period, its residential mortgage lending
will be at least £9 (nine)
billion above the amount shown in the baseline budget.

    

    
      	
              5.3

            	
              Homeowner Lending
      Commitment: 2010 commitment

            

    

    

    In the 2010 commitment period, the
Participating Institution undertakes to maintain similar levels of residential
mortgage lending as in the 2009 commitment period, subject to adjustment of the
commitment by agreement with the Government Departments to reflect circumstances at the
start of the 2010 commitment period.

    

    
      	
              5.4

            	
              Application of
      Homeowner Lending Commitment

            

    

    

    For the purposes of the Homeowner
Lending Commitment, the Participating Institution will ensure
that:

    

    
      	
              (A)

            	
              a reasonably competitive range of
      residential mortgage products are available for residential mortgage
      applicants for residential mortgages up to at least 90% loan-to- value
      (“LTV”);

            

    

    

    
      	
              (B)

            	
              applications for residential
      mortgage products are promptly processed and granted, subject to
      applicants meeting the Participating Institution’s standard credit and other
      acceptance criteria which must be both reasonable and consistent with
      market practice; and

            

    

    

    
      
        
        

      

      
        7

        
          

        

      

      
        
        

      

    

     

    
      	
              (C)

            	
              additional residential mortgage lending will be
      offered across the LTV bands (up to at least 90% LTV) and maturities, in
      line with the distribution of residential mortgages across such bands
      granted by the Participating Institution in
  2008.

            

    

    

    
      	
              5.5

            	
              Marketing
      relating to Homeowner Lending
      Commitment

            

    

    

    The Participating
Institution undertakes that it will promptly ensure that its staff are aware of
the Homeowner Lending Commitment and actively seek to implement such commitment
through sales and marketing activities targeted at residential homeowners
(including first time
buyers). The communication of the Homeowner Lending Commitment to staff, and the
marketing of such commitment to residential homeowners shall, in particular,
address the specific obligations undertaken by the Participating Institution
pursuant to paragraph
5.4.

    

    
      	
              5.6

            	
              General
      provisions about lending to
homeowners

            

    

    

    The Participating Institution
will:

    

    
      	
              (A)

            	
              actively participate in the
      Government’s Homeowners Mortgage Support
      Scheme, Mortgage Rescue Scheme and Support for Mortgage Interest and work
      to ensure that its eligible borrowers have the opportunity to benefit from
      these Schemes (where appropriate) and avoid
      repossession;

            

    

    

    
      	
              (B)

            	
              actively and constructively participate in the
      Home Finance Forum; and

            

    

    

    
      	
              (C)

            	
              review its policies for supporting
      individual borrowers in difficulty, with appropriate input from consumer
      groups.

            

    

    

    
      	
              5.7

            	
              Other
      provisions

            

    

    

    The Participating Institution
will:

    

    
      	
              (A)

            	
              actively and constructively
      participate in the Consumer Finance
  Forum;

            

    

    

    
      	
              (B)

            	
              abide by the principles agreed as
      part of the Credit Card Summit on 28 November 2008;
    and

            

    

    

    
      	
              (C)

            	
              work closely with registered
      social landlords with a view to continuing the supply of appropriate
      finance.

            

    

    

    
      
        
        

      

      
        8

        
          

        

      

      
        
        

      

    

     

    
      	
              6.

            	
              Adjustment of
      Lending Commitments

            

    

    

    The Government Departments may, in their
discretion but acting reasonably: (i) reduce the quantum of the Homeowner
Lending Commitment and/or
one or more of the Business Lending Commitments; or (ii) allow the Participating
Institution to increase its lending to one or more Relevant Business Categories
by the amount of any shortfall in residential mortgage lending (a “Commitment Adjustment”).

    

    The circumstances in which the
Government Departments may make such an adjustment to the Lending Commitments
include, but are not confined to, the following:

    

    
      	
              (A)

            	
              changes to economic conditions
      (including, without limitation, the level of demand for business and residential mortgage
      lending at the Participating Institution’s ordinary course pricing and
      terms and the level of availability within the market of other forms of
      debt and equity finance to UK
  businesses);

            

    

    

    
      	
              (B)

            	
              significant changes to the
      utilisation rates of lending to Large Corporates assumed in the baseline
      budget;

            

    

    

    
      	
              (C)

            	
              changes to the Government
      Departments’ expectations as to the amount of
      lending needed to maintain economic activity;
  and

            

    

    

    
      	
              (D)

            	
              updated assessments of the extent to which the
      Participating Institution has relied on Government support and the nature
      of the support utilised by the Participating
      Institution.

            

    

    

    In determining whether to make a
Commitment Adjustment, the Participating Institution understands that the Government
Departments will have regard to (and act reasonably in considering) any
submissions made by the Participating Institution as part of its ongoing
dialogue with the Government Departments regarding the operation and
implementation of the Lending Commitments
(including (without limitation) with respect to the Homeowner Lending Commitment
and Business Lending Commitments applicable in respect of the 2010 commitment
period) .

    

    If the Government Departments are
satisfied that the Lending
Commitments are no longer necessary to address the Government’s objectives of reinforcing the
stability of the financial system, increasing confidence and capacity to lend,
and in turn supporting the recovery of the economy, they may agree that
they should cease to
apply.

    

    The Participating Institution will
comply with the Lending Commitments in accordance with the provisions of this
Deed Poll on the understanding and assumption that: (i) the Schemes will be
established by the Government; and (ii) the Participating Institution will
participate in either or both of the Schemes on terms to be agreed with the
Government.

    

    It is understood that: (i) the Lending
Commitments will cease if
the Participating Institution does not participate in either of the Schemes by 1
June 2009; and (ii) if the Participating Institution only participates in one of
the Schemes prior to 1 June 2009 the Government will, in consultation with the
Participating Institution and acting
reasonably, make appropriate

    

    
      
        
        

      

      
        9

        
          

        

      

      
        
        

      

    

     

    reductions in the Lending Commitments
having regard to the quantum of financial support being provided by the
Government to the Participating Institution.

    

    
      	
              7.

            	
               Interaction of
      Lending Commitments with previous
  commitments

            

    

    

    The Participating Institution notes that
the Lending Commitments supersede the lending commitments given by the
Participating Institution in October 2008 in connection with its participation
in the Government’s Recapitalisation Scheme and in January
2009 in connection with the proposed
conversion of the preference shares held by the Treasury in the Participating
Institution into ordinary shares.

     

    
      
        	
                8.

              	
                Monitoring and
      Reporting

              

      

       

      
        
          	
                  8.1

                	
                  General
      requirements

                

        

         

        The Participating Institution agrees
that:

      

    

    

    
      	
              (A)

            	
              compliance with the Lending
      Commitments will be subject to a monitoring and reporting process between
      the Participating Institution and the Government Departments which will be
      detailed, transparent and determined by the Government Departments (acting
      reasonably) in consultation with the
      Participating Institution;

            

    

    

    
      	
              (B)

            	
              it will report to the Government
      Departments:

            

    

    

    
      	
               
      

            	
              (i)

            	
              on a monthly basis in a format,
      with content and within timescales, to be determined by the Government
      Departments (acting reasonably) in consultation with the
      Participating Institution (the “monthly reports”) and that: (i) in respect of the
      Business Lending Commitments, the monthly report will include (without
      limitation) the information and data described in
      paragraph   8.2; and (ii) in respect of the
      Homeowner Lending Commitment, each monthly report will include (without
      limitation) the information and data described in
      paragraph   8.3;
  and

            

    

    

    
      	
               
      

            	
              (ii)

            	
              on an annual basis in a format,
      with content and within timescales, to be determined by the Government
      Departments (acting reasonably) in consultation with the Participating
      Institution (the “annual reports”) to facilitate the reporting by
      the Government Departments envisaged in
      paragraph   8.5(B) and that each annual report will
      include (without limitation) the information and data described in
      paragraph   8.4; and

            

    

    

    
      	
              (C)

            	
              the monthly reports and annual
      reports will be
      submitted to the board of directors of the Participating Institution (the
      “Board”) prior to delivery to the
      Government Departments and, upon delivery to the Government Departments,
      will be accompanied by a certificate from a Board director that, to the best of his or her
      knowledge and belief, having made reasonable enquiries, the report fairly
      presents the relevant data and is not misleading for the purpose of
      assessing compliance with the Lending Commitments or the achievement of
      their purpose.

            

    

    

    
      
        
        

      

      
        10

        
          

        

      

      
        
        

      

    

     

    Without prejudice to
the specific requirements set out in this paragraph  
8, the Participating
Institution undertakes to be open and honest in its dealings with the Government
Departments in relation to the
implementation and operation of the Lending Commitments and will promptly
provide each Government Department with such other information as it reasonably
requires in connection with the Lending Commitments.

    

    
      	
              8.2

            	
              Business Lending
      Commitments: monthly reports

            

    

    

    In relation to the Business Lending
Commitments, the monthly reports will include:

    

    
      	
              (A)

            	
              a segmental analysis showing new
      and outstanding lending divided by both size of business (corresponding to
      the Relevant Business
      Categories) and industry
sector;

            

    

    

    
      	
              (B)

            	
              (in respect of SMEs) application
      numbers and acceptance rates by type of financing, together with the
      credit assessments of applicants, against the corresponding numbers for
      2008;

            

    

    

    
      	
              (C)

            	
              a summary of the distributions of the pricing and
      terms on which lending is being made available and details of the credit
      and risk assessment
methodology;

            

    

    

    
      	
              (D)

            	
              a narrative commentary on new
      lending activities in respect of new and existing borrowers;
      and

            

    

    

    
      	
              (E)

            	
              a narrative commentary on the
      data, explaining the reasons for any significant variances in the amount
      of outstanding loans and availability of credit by size of business or
      sector from the baseline
budget.

            

    

    

    
      	
              8.3

            	
              Homeowner Lending
      Commitment: monthly reports

            

    

    

    In relation to the Homeowner Lending
Commitment, the monthly reports will include:

    

    
      	
              (A)

            	
              a segmental analysis showing new
      loans and credit availability divided by transaction type (including LTV
      and Loan to Income (“LTI”)
  ratios);

            

    

    

    
      	
              (B)

            	
              application numbers and acceptance
      rates by product, together with the credit rating scores of applicants,
      against the corresponding numbers for
  2008;

            

    

    

    
      	
              (C)

            	
              a summary of the distributions of
      the pricing and terms on which lending is being made available
      and of the credit and
      risk assessment methodology;
and

            

    

    

    
      	
              (D)

            	
              a narrative commentary on the
      data, explaining the reasons for any significant variances in the amount
      of outstanding loans and availability of credit by transaction type from
      the baseline budget.

            

    

    

    
      	
              8.4

            	
              Lending
      Commitments: annual reports

            

    

    

    The annual reports will include
information of a type which is broadly equivalent to the data and information to
be contained in the monthly reports, except that (in relation to the
segmental

     

    
      
        
        

      

      
        11

        
          

        

      

      
        
        

      

    

     

    analysis referred to in
paragraph  
8.3(A)), the analysis will be
broken down by reference to outstanding loans at the end of the period rather
than new loans granted in such period.

    

    
      	
              8.5

            	
              Public
      disclosure

            

    

    

    The Participating Institution agrees
that:

    

    
      	
              (A)

            	
              the Government Departments may
      publicly announce details of the Lending Commitments and the associated
      obligations and undertakings of the Participating Institution as described
      in this Deed Poll; and

            

    

    

    
      	
              (B)

            	
              each of the Government Departments
      may report to Parliament and Parliamentary committees (including the
      Public Accounts Committee and the House of Commons Treasury Select
      Committee) on implementation of, and compliance with, the Lending
      Commitments, with such reporting expected to be
      undertaken on an annual
basis.

            

    

    

    
      
        	
                8.6

              	
                Confidentiality

              

      

    

    

    Certain data and information to be
included within the monthly reports, or otherwise provided to the Government
Departments by the Participating Institution pursuant to this Deed Poll, will be anonymised to
preserve customer confidentiality and will constitute confidential, commercially
sensitive data.

    

    Confidential
information provided to Government Departments pursuant to this Deed Poll will
(without prejudice to the rights of the Government
Departments described in paragraph   8.5(A)) be subject to
confidentiality arrangements between the Participating Institution and each of
the Government Departments (on substantially similar terms to the
confidentiality agreement
entered into between HM Treasury and the Participating Institution on 17
February, 2009).

     

    
      
        
        

      

      
        12

        
          

        

      

      
        
        

      

    

     

    
      	
              9.

            	
              Implementation
      plan

            

    

    

    The Participating
Institution undertakes that, promptly after the Lending Commitment takes effect,
it will prepare and present to the Government Departments a plan which will
address how the Lending Commitments are to be implemented. Such implementation
plan will include the
Participating Institution’s proposals regarding
the marketing and sales activities to be undertaken pursuant to
paragraphs   4.10 and  
5.5.

    

    
      	
              10.

            	
              Incentivisation

            

    

    

    The Participating
Institution will, in
applying its balanced scorecard approach to remuneration, ensure that the
performance assessment for staff employed in business units responsible for
delivery of the Lending Commitments will include an assessment of new lending
arising from the marketing and
sales activities undertaken pursuant to the Participating
Institution’s obligations under
paragraphs   4.10 and  
5.5.

    

    
      	
              11.

            	
              Compliance

            

    

    

    Any failure to comply with the Lending
Commitments or the other obligations of, or undertakings given by, the
Participating Institution under this Deed Poll will initially be addressed
through the reporting mechanism which will provide the Government
Departments with a framework to discuss with
the Participating Institution the background to and reasons for such
failure.

    

    In addition, failure to comply with the
Lending Commitments may result in the withdrawal or restriction of the
Participating Institution’s eligibility to roll over coverage
under the CGS from three to five years.

    

    
      	
              12.

            	
              Miscellaneous

            

    

    

    
      	
              12.1

            	
              Representations and
      warranties

            

    

    

    The Participating Institution represents
and warrants that:

    

    
      	
              (A)

            	
              it has the corporate
      power and the
      authority to enter into this Deed Poll and to carry out its obligations,
      and the undertakings given by it,
  hereunder;

            

    

    

    
      	
              (B)

            	
              it is duly organised and validly
      existing under the laws of its jurisdiction of organisation, and the
      execution of this Deed Poll and the consummation of the transactions
      contemplated herein have been duly authorised by all necessary action, and
      no other act or proceeding, corporate or
      otherwise, on its part is necessary to authorise the execution of this
      Deed Poll or the consummation of any of the transactions contemplated
      hereby; and

            

    

    

    
      	
              (C)

            	
              it has duly executed and delivered
      this Deed Poll.

            

    

     

    
      
        
        

      

      
        13

        
          

        

      

      
        
        

      

    

     

    
      	
              12.2

            	
              Costs

            

    

    

    The Participating Institution agrees
that it shall pay its own costs and expenses in relation to the negotiation,
preparation, execution and carrying into effect of this Deed
Poll.

    

    
      	
              12.3

            	
              Remedies

            

    

    

    The Participating Institution agrees
that:

    

    
      	
              (A)

            	
              (without prejudice to any other
      rights or remedies which any Government Department may have) damages would
      not be an adequate remedy for any breach by the Participating Institution
      of the provisions of this Deed Poll and each Government
      Department shall be entitled to seek the remedies of injunction, specific
      performance and other equitable relief for any threatened or actual breach
      of any such provision by the Participating Institution and no proof of
      special damages shall be necessary for
      the enforcement by any Government Department of its rights under this Deed
      Poll;

            

    

    

    
      	
              (B)

            	
              no failure of any Government
      Department to exercise, and no delay by any Government Department in
      exercising, any right, power or remedy in connection with this Deed
      Poll will operate as a waiver thereof, nor will any single or partial
      exercise of any such right preclude any other or further exercise of such
      right or the exercise of any other right;
  and

            

    

    

    
      	
              (C)

            	
              the rights provided in
      this Deed Poll are
      cumulative and not exclusive of any rights (whether provided by law or
      otherwise).

            

    

    

    
      	
              12.4 

            	
              Invalidity

            

    

    

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

    

    
      	
              12.5 

            	
              Assignment

            

    

    

    The Participating Institution agrees
that each of the Government Departments may assign their respective rights under
this Deed Poll to: (i) a governmental, quasi-governmental or regulatory body; or
(ii) a body or entity established by, or owned by, one or more of the Government Departments
(including any body or entity established to monitor and administer the
APS).

    

    
      	
              12.6

            	
              Variation

            

    

    

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

    

    
      	
              12.7

            	
              Governing
    law

            

    

    

    
      
        
        

      

      
        14

        
          

        

      

      
        
        

      

    

    

    This Deed Poll and any non-contractual
obligations arising out of or in connection with it shall be governed by and
construed in accordance with the laws of England.

    

    
      
        
        

      

      
        15

        
          

        

      

      
        
        

      

    

    

    
      IN WITNESS WHEREOF this Deed
Poll has been executed and delivered as a deed on 26 February 2009.

       

      
        	
                The
      Royal Bank of Scotland plc

              	
                )

              	
                By:           

              	 	 
	 	)	
                 

              
	 	)	
                duly
      authorised by power of attorney to act as 

              	 
	 	)	attorney on
      its behalf in executing and delivering 	 
	 	)	this Deed
      Poll	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	Name:	 	 
	 	 	 	 	 
	 	 	Title:	Attorney	 

      

       

       

      
        
           

        

        
          16

          
            

          

        

        
           

        

      

      
         

      

      
         

      

      
        
          	
                  Appendix
      - Baseline Budget for 2009 and Lending Commitments

                	 
      	 
      	 
      	 
      
	
                  £ billions

                	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                  The
      Business Lending Commitment

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                  Aggregate Business Lending
      Commitment

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2009 Lending -
      Commitment

                	 
      	 
      	 
      	 
      	 
      	
                  16.0

                
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                  Minimum Lending Commitment by
      Business Category

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
                  Small and Medium Sized Enterprises
      (SME)

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2008 total
      lending

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (a)

                	
                  2009 lending - Baseline
      Budget

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (b)

                	
                  2009 Lending Commitment (above
      Baseline Budget)

                	 
      	 
      	 
      
	 
      	
                  (a)+(b)

                	
                  2009 total
      lending

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2009 Baseline impairments and
      write offs

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
                  Mid
    Corporates

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2008 total
      lending

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (a)

                	
                  2009 lending - Baseline
      Budget

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (b)

                	
                  2009 Lending Commitment (above
      Baseline Budget)

                	 
      	 
      	 
      
	 
      	
                  (a)+(b)

                	
                  2009 total
      lending

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2009 Baseline impairments and
      write offs

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	
                  Large
      Corporates

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2008 total
      lending

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (a)

                	
                  2009 lending - Baseline
      Budget

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (b)

                	
                  2009 Lending Commitment (above
      Baseline Budget)

                	 
      	 
      	 
      
	 
      	
                  (a)+(b)

                	
                  2009 total
      lending

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2009 Average utilisation -
      Baseline

                	 
      	
                  %

                	 
      	 
      	 
      	 
      
	 
      	 
      	
                  (drawn facilities/committed
      facilities)

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2009 Baseline impairments and
      write offs

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                  The
      Homeowner Lending Commitment

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	
                  2008 total
      lending

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (a)

                	
                  2009 lending - Baseline
      Budget

                	 
      	
                  ***

                	 
      	 
      	 
      	 
      
	 
      	
                  (b)

                	
                  2009 Lending Commitment (above
      Baseline Budget)

                	 
      	 
      	
                  9.0

                
	 
      	
                  (a)+(b)

                	
                  2009 total
      lending

                	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	
                  Total 2009 Lending Commitment
      (above Baseline Budget)

                	 
      	 
      	 
      	 
      	 
      	
                  25.0

                
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      
	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      	 
      

        

        
           

           

           

        

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

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00162-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00162-of-00352.parquet"}]]