Tier 2

Recognition of UK Bail-in Power

(a) Notwithstanding, and to the exclusion of, any other term of the Notes or any other agreements, arrangements, or understandings between the Issuer and any Noteholder, by its acquisition of the Notes, each Noteholder acknowledges and accepts that the Amounts Due arising under the Notes may be subject to the exercise of the UK Bail-in Power by the Resolution Authority, and acknowledges, accepts, consents and agrees to be bound by:

(i) the effect of the exercise of the UK Bail-in Power by the Resolution Authority, that may include and result in any of the following, or some combination thereof:
(A) the reduction of all, or a portion, of the Amounts Due;
(B) the conversion of all, or a portion, of the Amounts Due on the Notes into shares, other securities or other obligations of the Issuer or another person (and the issue to or conferral on the Noteholder of such shares, securities or obligations), including by means of an amendment, modification or variation of the terms of the Notes); (C) the cancellation of the Notes; and
(D) the amendment or alteration of the maturity of the Notes or amendment of the amount of interest payable on the Notes, or the date on which the interest becomes payable, including by suspending payment for a temporary period; and

(ii) the variation of the terms of the Notes, if necessary, to give effect to the exercise of the UK Bail-in Power by the Resolution Authority.

(b) No repayment or payment of Amounts Due on the Notes will become due and payable or to be paid after the exercise of any UK Bail-in Power by the Resolution Authority if and to the extent such amounts have been reduced, converted, cancelled, suspended (for so long as such suspension or moratorium is outstanding), amended or altered as a result of such exercise.

(c) Neither a reduction or cancellation, in part or in full, of the Amounts Due or the conversion thereof into another security or obligation of the Issuer or another person, as a result of the exercise of the UK Bail-in Power by the Resolution Authority with respect to the Issuer, nor the exercise of the UK Bail-in Power by the Resolution Authority with respect to the Notes will be a default or an Event of Default for any purpose.

Capital Disqualification Event Redemption

If at any time a Capital Disqualification Event (as defined in Conditions) has occurred, the Issuer may, subject to the satisfaction of the Conditions to Redemption and Purchase described in the Conditions, redeem the Tier 2 Notes in whole, but not in part, at any time at 100% of their principal amount, together with any accrued and unpaid interest to, but excluding, the date fixed for redemption.

Substitution or Variation

If a Tax Event or Capital Disqualification Event has occurred, then the Issuer may, subject to the conditions described in the Conditions including terms not materially less favourable to Noteholders, but without any requirement for the consent or approval of the holders of the Tier 2 Notes, at any time (whether before, on or following the Reset Date) either substitute all (but not some only) of the Tier 2 Notes for, or vary the terms of the Tier 2 Notes so that they remain or, as appropriate, become, Compliant Securities (as defined in the Conditions).

Waiver of set-off

The Dated Subordinated Notes are not eligible for any set-off by any Noteholder. Noteholders shall not be able to exercise or claim any right of set-off in respect of any amount owed by the Issuer arising under or in connection with the Dated Subordinated Notes