As disclosed in the Prospectus, Citigroup Global Markets U.K. Equity Limited, J.P. Morgan Cazenove Limited and UBS Limited (the "Joint Bookrunners") will use reasonable endeavours to procure placees for the balance of Open Offer Shares (representing approximately 13 per cent of the total number of Open Offer Shares) not validly taken up in the Compensatory Open Offer (the "Rump") at an aggregate price at least equal to the Issue Price of 38.43 pence multiplied by the number of Open Offer Shares not validly taken up which are placed by the Joint Bookrunners (plus associated expenses) (the "Minimum Rump Placing Amount").
Any premium to the Minimum Rump Placing Amount shall be paid to Qualifying Shareholders who have not (or are deemed not to have) taken up some or all Open Offer Shares and to other Registered Shareholders who were not entitled to apply for Open Offer Shares by virtue of their being resident in a Restricted Jurisdiction, on a pro rata basis, save that amounts of less than £3.00 per holding will not be so paid but will be aggregated and donated to charity (the British Heart Foundation). Fractional Open Offer Entitlements will be aggregated and the resulting Open Offer Shares will be placed for the benefit of the Company.
A further announcement as to the number of Open Offer Shares for which acquirers have been procured and those (if any) which are to be acquired by HM Treasury as Underwriter will be made in due course. A further announcement as to the number of Ordinary Shares in issue and HM Treasury's holding in the Company following the closing of the Placing and Compensatory Open Offer will also be made in due course.
Accepted Shares in uncertificated form are expected to be credited to accounts in CREST by 8.00 am today and despatch of definitive share certificates for the Accepted Shares in certificated form is expected to take place by 19 June 2009.
HMT Preference Share Redemption
As announced on 7 March 2009 and set out in the Prospectus, Lloyds Banking Group will use the proceeds of the Placing and Compensatory Open Offer (being not less than £3,940 million net of commissions of up to £60 million payable to HM Treasury under the Open Offer Agreement), together with up to £300 million of the Group's existing cash resources, to redeem all outstanding HMT Preference Shares issued to HM Treasury in January 2009 at 101 per cent of their issue price (in accordance with the terms agreed with HM Treasury) together with accrued dividends thereon.
Today Lloyds Banking Group will use proceeds of the Compensatory Open Offer together with existing cash resources to redeem 3,475,284 outstanding HMT Preference Shares. Following this first redemption, the remaining 524,716 outstanding HMT Preference Shares are expected to be redeemed shortly after the completion of the placing of the Rump. A further announcement will be made in due course.
