Document:

Exhibit 4.1

 

SYNCHRONY CREDIT CARD MASTER NOTE TRUST,

 

as Issuer

 

and

 

DEUTSCHE BANK TRUST COMPANY AMERICAS,

 

as Indenture Trustee

 

Series 2016-3 INDENTURE SUPPLEMENT

 

Dated as of September 22, 2016

  

     

     

    

 

Table
of Contents

 

	 	 	Page

	 	 	 
	ARTICLE I	Definitions	 
	 	 	 
	SECTION 1.1.	Definitions	1
	SECTION 1.2.	Incorporation of Terms	16
	 	 	 
	ARTICLE II	Creation of the Series 2016-3 Notes	 
	 	 	 
	SECTION 2.1.	Designation	16
	SECTION 2.2.	Transfer Restrictions Applicable to the Class C Notes and the Class D Notes	16
	 	 	 
	ARTICLE III	REPRESENTATIONS, WARRANTIES and Covenants	 
	 	 	 
	SECTION 3.1.	Representations, Warranties and Covenants with respect to Receivables	19
	SECTION 3.2.	Representations, Warranties and Covenants with respect to ERISA	19
	 	 	 
	ARTICLE IV	Rights of Series 2016-3 Noteholders and Allocation and Application of Collections	 
	 	 	 
	SECTION 4.1.	Determination of Interest and Principal	19
	SECTION 4.2.	Establishment of Accounts	21
	SECTION 4.3.	Calculations and Series Allocations	22
	SECTION 4.4.	Application of Available Finance Charge Collections and Available Principal Collections	23
	SECTION 4.5.	Distributions	27
	SECTION 4.6.	Investor Charge-Offs	27
	SECTION 4.7.	Reallocated Principal Collections	28
	SECTION 4.8.	Excess Finance Charge Collections	28
	SECTION 4.9.	Shared Principal Collections	28
	SECTION 4.10.	Reserve Account	29
	SECTION 4.11.	Spread Account	29
	SECTION 4.12.	Investment of Accounts	30
	SECTION 4.13.	Controlled Accumulation Period	31
	SECTION 4.14.	[Reserved]	31
	SECTION 4.15.	Deposit of Collections	32
	 	 	 
	ARTICLE V	Delivery of Series 2016-3 Notes; Reports to Series 2016-3 Noteholders	 
	 	 	 
	SECTION 5.1.	Delivery and Payment for the Series 2016-3 Notes	32
	SECTION 5.2.	Reports and Statements to Series 2016-3 Noteholders	32
	 	 	 
	ARTICLE VI	Series 2016-3 Early Amortization Events	 
	 	 	 
	SECTION 6.1.	Series 2016-3 Early Amortization Events	32
	 	 	 
	ARTICLE VII	Redemption of Series 2016-3 Notes; Final Distributions; Series Termination	 

 

    	 	i	 

     

    

  

Table
of Contents

(continued)

 

	 	 	Page

	 	 	 
	SECTION 7.1.	Optional Redemption of Series 2016-3 Notes; Final Distributions	34
	SECTION 7.2.	Series Termination	35
	SECTION 7.3.	Sale of Collateral	35
	 	 	 
	ARTICLE VIII	Miscellaneous Provisions	 
	 	 	 
	SECTION 8.1.	Ratification of Indenture; Amendments	36
	SECTION 8.2.	Form of Delivery of the Series 2016-3 Notes	36
	SECTION 8.3.	Counterparts	36
	SECTION 8.4.	GOVERNING LAW	36
	SECTION 8.5.	Limitation of Liability	37
	SECTION 8.6.	Rights of the Indenture Trustee	37
	SECTION 8.7.	Notice Address for Rating Agencies	37
	SECTION 8.8.	Compliance with Applicable Anti-Terrorism and Anti-Money Laundering Regulations	38
	SECTION 8.9.	Notes to be Treated as Debt for Tax	38
	SECTION 8.10.	Deemed Consent	38

 

	EXHIBITS	 
	 	 
	EXHIBIT A-1	FORM OF CLASS A NOTE
	 	 
	EXHIBIT A-2	FORM OF CLASS B NOTE
	 	 
	EXHIBIT A-3	FORM OF CLASS C NOTE
	 	 
	EXHIBIT A-4	FORM OF CLASS D NOTE
	 	 
	EXHIBIT B	FORM OF MONTHLY NOTEHOLDER’S STATEMENT
	 	 
	SCHEDULES	 
	 	 
	SCHEDULE I	PERFECTION REPRESENTATIONS, WARRANTIES AND COVENANTS (With Respect to Receivables)

 

    	 	ii	 

     

    

  

SERIES 2016-3 INDENTURE
SUPPLEMENT, dated as of September 22, 2016 (this “Indenture Supplement”), between SYNCHRONY CREDIT CARD MASTER
NOTE TRUST, a Delaware statutory trust (herein, the “Issuer” or the “Trust”), and DEUTSCHE
BANK TRUST COMPANY AMERICAS, a New York banking corporation, not in its individual capacity, but solely as indenture trustee (herein,
together with its successors as provided in the Master Indenture referred to below, the “Indenture Trustee”)
under the Master Indenture, dated as of September 25, 2003 (the “Indenture”), between the Issuer and the Indenture
Trustee, as amended by the Omnibus Amendment No.1 to Securitization Documents, dated as of February 9, 2004, among RFS Holding,
L.L.C., RFS Funding Trust, the Issuer, Deutsche Bank Trust Company Delaware, as trustee of RFS Funding Trust, RFS Holding, Inc.
and the Indenture Trustee, as further amended by the Second Amendment to Master Indenture, dated as of June 17, 2004, between the
Issuer and the Indenture Trustee, as further amended by the Third Amendment to Master Indenture, dated as of August 31, 2006, between
the Issuer and the Indenture Trustee, as further amended by the Fourth Amendment to Master Indenture, dated as of June 28, 2007,
between the Issuer and the Indenture Trustee, as further amended by the Fifth Amendment to Master Indenture, dated as of May 22,
2008, between the Issuer and the Indenture Trustee, as further amended by the Sixth Amendment to Master Indenture, dated as of
August 7, 2009, between the Issuer and the Indenture Trustee, as further amended by the Seventh Amendment to Master Indenture,
dated as of January 21, 2014, between the Issuer and the Indenture Trustee, as further amended by the Eighth Amendment to
Master Indenture and Omnibus Supplement to Specified Indenture Supplements, dated as of March 11, 2014, between the Issuer
and the Indenture Trustee, as further amended by the Ninth Amendment to Master Indenture, dated as of November 24, 2015, between
the Issuer and the Indenture Trustee, and as further amended by the Tenth Amendment to Master Indenture, dated as of March 3, 2016,
between the Issuer and the Indenture Trustee (the Indenture, together with this Indenture Supplement, the “Agreement”).

 

The Principal Terms of
this Series are set forth in this Indenture Supplement to the Indenture.

 

ARTICLE
I

Definitions

 

SECTION 1.1. Definitions.

 

(a)          Capitalized
terms used and not otherwise defined herein are used as defined in Section 1.1 of the Indenture. This Indenture Supplement
shall be interpreted in accordance with the conventions set forth in Section 1.2 and Section 1.3 of the Indenture.

 

(b)          Each
capitalized term defined herein relates only to Series 2016-3 and to no other Series. Whenever used in this Indenture Supplement,
the following words and phrases shall have the following meanings:

 

“Accumulation
Shortfall” means (a) for the first Payment Date during the Controlled Accumulation Period, zero; and (b) thereafter,
for any Payment Date during the Controlled Accumulation Period, the excess, if any, of the Controlled Deposit Amount for the previous
Payment Date over the amount deposited into the Principal Accumulation Account pursuant to Section 4.4(c)(i) for the previous
Payment Date.

 

     

     

    

 

“Addition Date”
means an “Addition Date” as such term is defined in the Transfer Agreement.

 

“Additional Interest”
means, for any Payment Date, Class A Additional Interest, Class B Additional Interest, Class C Additional Interest and Class
D Additional Interest for such Payment Date.

 

“Administration
Agreement” means the Administration Agreement, dated as of September 25, 2003, between the Administrator and the Issuer.

 

“Administrator”
means SYNCHRONY FINANCIAL, in its capacity as Administrator under the Administration Agreement or any other Person designated as
an Administrator under the Administration Agreement.

 

“Agreement”
is defined in the preamble.

 

“Allocation Percentage”
means, with respect to any date of determination in any Monthly Period, the percentage equivalent of a fraction:

 

(a) the
numerator of which shall be equal to:

 

(i) for Principal
Collections during the Revolving Period and for Finance Charge Collections and Default Amounts at any time, the Collateral Amount
at the end of the last day of the prior Monthly Period (or, in the case of the first Monthly Period, on the Closing Date); or

 

(ii) for Principal
Collections during the Early Amortization Period and the Controlled Accumulation Period, the Collateral Amount at the end of the
last day of the Revolving Period; provided, that on and after the date on which the Principal Accumulation Account Balance
equals the Note Principal Balance, the numerator shall equal zero; and

 

(b) the
denominator of which shall be the greater of (x) the Aggregate Principal Receivables determined as of the close of business
on the last day of the prior Monthly Period (or, in the case of the first Monthly Period, on the Closing Date) and (y) the
sum of the numerators used to calculate the allocation percentages for allocations with respect to Finance Charge Collections,
Principal Collections or Default Amounts, as applicable, for all outstanding Series on such date of determination; provided,
that if one or more Reset Dates occur in a Monthly Period, the denominator determined pursuant to clause (x) of this clause (b)
shall be (A) the Aggregate Principal Receivables as of the close of business on the last day of the prior Monthly Period for the
period from and including the first day of the current Monthly Period, to but excluding such Reset Date and (B) the Aggregate Principal
Receivables as of the close of business on such Reset Date, for the period from and including such Reset Date to the earlier of
the last day of such Monthly Period (in which case such period shall include such day) or the next succeeding Reset Date (in which
case such period shall not include such succeeding Reset Date); and provided, further, that notwithstanding the preceding
proviso, if a Reset Date occurs during any Monthly Period and the Issuer makes a single monthly deposit of Collections to the Collection
Account pursuant to Section 8.4 of the Indenture for such Monthly Period and has not elected to make daily deposits to the
Collection Account, then the denominator determined pursuant to clause (x) of this clause (b) for each day during such Monthly
Period shall equal the Average Principal Balance for such Monthly Period.

 

    	 	2	 

     

    

 

“Available Finance
Charge Collections” means, for any Monthly Period, an amount equal to the sum of (a) the Investor Finance Charge Collections
for such Monthly Period, (b) the Series 2016-3 Excess Finance Charge Collections for such Monthly Period, (c) Principal Accumulation
Investment Proceeds, if any, with respect to the related Transfer Date, (d) interest and earnings on funds on deposit in the Reserve
Account which will be treated as Available Finance Charge Collections pursuant to Section 4.10(a) and (e) amounts, if any,
to be withdrawn from the Reserve Account which will be deposited into the Finance Charge Account on the related Transfer Date to
be treated as Available Finance Charge Collections pursuant to Section 4.10(c); provided, that for purposes of the statement
to be delivered pursuant to Section 5.2(a), the Servicer may estimate the amount of interest, earnings and expenses on any
Series Account based on the most recent statement delivered by the related deposit bank.

 

“Available
Principal Collections” means, for any Monthly Period, an amount equal to the sum of (a) the Investor Principal Collections
for such Monthly Period, minus (b) the amount of Reallocated Principal Collections with respect to such Monthly Period
which pursuant to Section 4.7 are required to be applied on the related Payment Date, plus (c) the sum of (i)
any Shared Principal Collections with respect to other Principal Sharing Series (including any amounts on deposit in the Excess
Funding Account that are allocated to Series 2016-3 for application as Shared Principal Collections), (ii) the aggregate amount
to be treated as Available Principal Collections pursuant to Sections 4.4(a)(vii), (viii) and (xi) and (iii)
during an Early Amortization Period, the amount of Available Finance Charge Collections used to pay principal on the Notes pursuant
to Section 4.4(a)(xiv) for the related Payment Date.

 

“Available Reserve
Account Amount” means, for any Transfer Date, the lesser of (a) the amount on deposit in the Reserve Account (after taking
into account any interest and earnings retained in the Reserve Account pursuant to Section 4.10(a) on such date, but before
giving effect to any deposit made or to be made pursuant to Section 4.4(a)(ix) to the Reserve Account on such date) and
(b) the Required Reserve Account Amount.

 

“Available Spread
Account Amount” means, for any Transfer Date, an amount equal to the lesser of (a) the amount on deposit in the Spread
Account (exclusive of Investment Earnings on such date and before giving effect to any deposit to, or withdrawal from, the Spread
Account made or to be made with respect to such date) and (b) the Required Spread Account Amount, in each case on such Transfer
Date.

 

“Average Principal
Balance” means for any Monthly Period in which a Reset Date occurs, the sum of (i) the Aggregate Principal Receivables
determined as of the close of business on the last day of the prior Monthly Period, multiplied by a fraction, the numerator
of which is the number of days from and including the first day of such Monthly Period, to but excluding the related Reset Date,
and the denominator of which is the number of days in such Monthly Period and (ii) for each such Reset Date, the product of the
Aggregate Principal Receivables determined as of the close of business on such Reset Date, multiplied by a fraction, the
numerator of which is the number of days from and including such Reset Date, to the earlier of the last day of such Monthly Period
(in which case such period shall include such date) or the next succeeding Reset Date (in which case such period shall exclude
such date), and the denominator of which is the number of days in such Monthly Period.

 

    	 	3	 

     

    

 

“Base Rate”
means, for any Monthly Period, the annualized percentage (based on a 360-day year of twelve 30-day months, or in the case of the
initial Monthly Period, the actual number of days and a 360-day year) equivalent of a fraction, the numerator of which is equal
to the sum of (a) the Monthly Interest, (b) the amount required to be paid pursuant to Section 4.4(a)(i) and (c) the Noteholder
Servicing Fee, each with respect to the related Payment Date, and the denominator of which is the Collateral Amount plus amounts
on deposit in the Principal Accumulation Account, each as of the close of business on the last day of such Monthly Period.

 

“Benefit Plan”
means (i) an “employee benefit plan” as defined in Section 3(3) of ERISA, that is subject to Title I of ERISA, (ii)
a “plan” as defined in Section 4975 of the Code that is subject to Section 4975 of the Code, or (iii) an entity whose
underlying assets include plan assets by reason of investment by an employee benefit plan or plan in such entity.

 

“Business Day”
means any day that is not a Saturday, a Sunday or a day on which banks are required or permitted to be closed in the State of New
York or the State of Connecticut.

 

“Class A Additional
Interest” is defined in Section 4.1(a).

 

“Class A Deficiency
Amount” is defined in Section 4.1(a).

 

“Class A Monthly
Interest” is defined in Section 4.1(a).

 

“Class A Note
Initial Principal Balance” means $700,000,000.

 

“Class A Note
Interest Rate” means a per annum rate of 1.58%.

 

“Class A Note
Principal Balance” means, on any date of determination, an amount equal to (a) the Class A Note Initial Principal Balance,
minus (b) the aggregate amount of principal payments made to the Class A Noteholders on or prior to such date.

 

“Class A Noteholder”
means the Person in whose name a Class A Note is registered in the Note Register.

 

“Class A Notes”
means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in
the form of Exhibit A-1.

 

“Class A Required
Amount” means, for any Payment Date, an amount equal to the excess of the amounts described in Sections 4.4(a)(i),
(ii) and (iii) over Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

“Class B Additional
Interest” is defined in Section 4.1(b).

 

“Class B Deficiency
Amount” is defined in Section 4.1(b).

 

    	 	4	 

     

    

 

“Class B Monthly
Interest” is defined in Section 4.1(b).

 

“Class B Note
Initial Principal Balance” means $67,123,287.

 

“Class B Note
Interest Rate” means a per annum rate of 1.91%.

 

“Class B Note
Principal Balance” means, on any date of determination, an amount equal to (a) the Class B Note Initial Principal Balance,
minus (b) the aggregate amount of principal payments made to the Class B Noteholders on or prior to such date.

 

“Class B Noteholder”
means the Person in whose name a Class B Note is registered in the Note Register.

 

“Class B Notes”
means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in
the form of Exhibit A-2.

 

“Class B Required
Amount” means, for any Payment Date, an amount equal to the excess of the amount described in Section 4.4(a)(iv)
over Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

“Class C Additional
Interest” is defined in Section 4.1(c).

 

“Class C Deficiency
Amount” is defined in Section 4.1(c).

 

“Class C Monthly
Interest” is defined in Section 4.1(c).

 

“Class C Note
Initial Principal Balance” means $57,534,247.

 

“Class C Note
Interest Rate” means a per annum rate of 2.30%.

 

“Class C Note
Principal Balance” means, on any date of determination, an amount equal to (a) the Class C Note Initial Principal Balance,
minus (b) the aggregate amount of principal payments made to the Class C Noteholders on or prior to such date.

 

“Class C Note
Transfer” is defined in Section 2.2(b).

 

“Class C Noteholder”
means the Person in whose name a Class C Note is registered in the Note Register.

 

“Class C Notes”
means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in
the form of Exhibit A-3.

 

“Class C Required
Amount” means, for any Payment Date, an amount equal to the excess of the amount described in Section 4.4(a)(v)
over Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

“Class D Additional
Interest” is defined in Section 4.1(d).

 

“Class D Deficiency
Amount” is defined in Section 4.1(d).

 

    	 	5	 

     

    

 

“Class D Monthly
Interest” is defined in Section 4.1(d).

 

“Class D Note
Initial Principal Balance” means $86,301,370.

 

“Class D Note
Interest Rate” means a per annum rate of 2.95%.

 

“Class D Note
Principal Balance” means, on any date of determination, an amount equal to (a) the Class D Note Initial Principal Balance,
minus (b) the aggregate amount of principal payments made to the Class D Noteholders on or prior to such date.

 

“Class D Note
Transfer” is defined in Section 2.2(b).

 

“Class D Noteholder”
means the Person in whose name a Class D Note is registered in the Note Register.

 

“Class D Notes”
means any one of the Notes executed by the Issuer and authenticated by or on behalf of the Indenture Trustee, substantially in
the form of Exhibit A-4.

 

“Class D Required
Amount” means with respect to any Payment Date, an amount equal to the excess of the amount described in Section 4.4(a)(vi)
over Available Finance Charge Collections applied to pay such amount pursuant to Section 4.4(a).

 

“Closing Date”
means September 22, 2016.

 

“Collateral Amount”
means, as of any date of determination, an amount equal to the excess of (a) the Initial Collateral Amount, over (b) the
sum of (i) the amount of principal previously paid to the Series 2016-3 Noteholders (other than any principal payments made from
funds on deposit in the Spread Account), (ii) reductions in the Collateral Amount pursuant to Section 4.4(f), (iii) the
Principal Accumulation Account Balance and (iv) the excess, if any, of the aggregate amount of Investor Charge-Offs and Reallocated
Principal Collections over the reimbursements of such amounts pursuant to Section 4.4(a)(viii) prior to such date.

 

“Controlled Accumulation
Amount” means, for any Payment Date with respect to the Controlled Accumulation Period, $303,652,968; provided,
however, that if the Controlled Accumulation Period Length is determined to be more than or less than three months pursuant
to Section 4.13, the Controlled Accumulation Amount for each Payment Date with respect to the Controlled Accumulation Period
will be equal to (i) the initial Note Principal Balance divided by (ii) the Controlled Accumulation Period Length; provided,
further, that the Controlled Accumulation Amount for any Payment Date shall not exceed the Note Principal Balance minus
any amount already on deposit in the Principal Accumulation Account on such Payment Date.

 

“Controlled Accumulation
Period” means, unless an Early Amortization Event shall have occurred prior thereto, the period commencing on the first
day of the third Monthly Period preceding the Expected Principal Payment Date or such other date as is determined in accordance
with Section 4.13 and ending on the first to occur of (a) the commencement of the Early Amortization Period and (b) the
Final Payment Date.

 

“Controlled Accumulation
Period Length” is defined in Section 4.13.

 

    	 	6	 

     

    

 

“Controlled Deposit
Amount” means, for any Payment Date with respect to the Controlled Accumulation Period, an amount equal to the sum of
the Controlled Accumulation Amount for such Payment Date and any existing Accumulation Shortfall.

 

“Covered Amount”
means an amount, determined as of each Transfer Date for any Interest Period, equal to the sum of:

 

(a)          product
of (i) the Class A Monthly Interest and (ii) a fraction (A) the numerator of which is equal to the lesser of the Principal Accumulation
Account Balance and the Class A Note Principal Balance, each as of the last day of the calendar month preceding such Transfer Date,
and (B) the denominator of which is equal to the Class A Note Principal Balance as of the last day of the calendar month preceding
such Transfer Date;

 

(b)          product
of (i) the Class B Monthly Interest and (ii) a fraction (A) the numerator of which is equal to the lesser of (x) the excess of
the Principal Accumulation Account Balance over the Class A Note Principal Balance as of the last day of the calendar month preceding
such Transfer Date and (y) the Class B Note Principal Balance as of the last day of the calendar month preceding such Transfer
Date, and (B) the denominator of which is equal to the Class B Note Principal Balance as of the last day of the calendar month
preceding such Transfer Date; and

 

(c)          product
of (i) the Class C Monthly Interest and (ii) a fraction (A) the numerator of which is equal to the lesser of (x) the excess of
the Principal Accumulation Account Balance over the Class A Note Principal Balance and the Class B Note Principal Balance as of
the last day of the calendar month preceding such Transfer Date and (y) the Class C Note Principal Balance as of the last day of
the calendar month preceding such Transfer Date, and (B) the denominator of which is equal to the Class C Note Principal Balance
as of the last day of the calendar month preceding such Transfer Date; and

 

(d)          product
of (i) the Class D Monthly Interest and (ii) a fraction (A) the numerator of which is equal to the lesser of (x) the excess of
the Principal Accumulation Account Balance over the sum of the Class A Note Principal Balance, the Class B Note Principal Balance
and the Class C Note Principal Balance, each as of the last day of the calendar month preceding such Transfer Date and (y) the
Class D Note Principal Balance as of the last day of the calendar month preceding such Transfer Date, and (B) the denominator
of which is equal to the Class D Note Principal Balance as of the last day of the calendar month preceding such Transfer Date.

 

“Default Amount”
means, as to any Defaulted Account, the amount of Principal Receivables (other than Ineligible Receivables (as such term is defined
in the Transfer Agreement), unless there is an Insolvency Event with respect to the Originator or the Transferor) in such Defaulted
Account on the day it became a Defaulted Account.

 

“Defaulted Account”
means an Account in which there are Charged-Off Receivables.

 

“Dilution”
means any downward adjustment made by Servicer in the amount of any Transferred Receivable (a) because of a rebate, refund or billing
error to an accountholder, (b) because such Transferred Receivable was created in respect of merchandise which was refused or returned
by an accountholder or (c) for any other reason other than receiving Collections therefor or charging off such amount as uncollectible.

 

    	 	7	 

     

    

 

“Distribution
Account” means the account designated as such, established and owned by the Issuer and maintained in accordance with
Section 4.2.

 

“Early Amortization
Period” means the period commencing on the date on which a Trust Early Amortization Event or a Series 2016-3 Early Amortization
Event is deemed to occur and ending on the Final Payment Date.

 

“ERISA”
means the Employee Retirement Income Security Act of 1974, as amended.

 

“Excess Collateral
Amount” means, at any time, the excess of (a) the sum of (i) the Collateral Amount and (ii) the Principal Accumulation
Account Balance, over (b) the Note Principal Balance.

 

“Excess Spread
Percentage” means, for any Monthly Period, a percentage equal to (a) the Portfolio Yield for such Monthly Period, minus
(b) the Base Rate for such Monthly Period.

 

“Expected Principal
Payment Date” means the September 2019 Payment Date.

 

“Final Payment
Date” means the earliest to occur of (a) the date on which the Note Principal Balance is paid in full, (b) the date on
which the Collateral Amount is reduced to zero and (c) the Series Maturity Date.

 

“Finance Charge
Account” means the account designated as such, established and owned by the Issuer and maintained in accordance with
Section 4.2.

 

“Finance Charge
Shortfall” is defined in Section 4.8.

 

“Group One”
means Series 2016-3 and each other outstanding Series previously or hereafter specified in the related Indenture Supplement to
be included in Group One.

 

“Indenture”
is defined in the preamble.

 

“Indenture Trustee”
is defined in the preamble.

 

“Initial Collateral
Amount” means $958,904,110, which equals the sum of (i) the Class A Note Initial Principal Balance, (ii) the Class B
Note Initial Principal Balance, (iii) the Class C Note Initial Principal Balance, (iv) the Class D Note Initial Principal Balance
and (v) the Initial Excess Collateral Amount.

 

“Initial Excess
Collateral Amount” means $47,945,206.

 

“Interest Period”
means, for any Payment Date, the period from and including the Payment Date immediately preceding such Payment Date (or, in the
case of the initial Payment Date, from and including the Closing Date) to but excluding such Payment Date.

 

    	 	8	 

     

    

 

“Investment Earnings”
means, for any Payment Date, all interest and earnings on Permitted Investments included in the Spread Account (net of losses and
investment expenses) during the period commencing on and including the Payment Date immediately preceding such Payment Date and
ending on but excluding such Payment Date.

 

“Investor Charge-Offs”
is defined in Section 4.6.

 

“Investor Default
Amount” means, for any Monthly Period, the sum for all Accounts that became Defaulted Accounts during such Monthly Period,
of the following amount: the product of (a) the Default Amount with respect to each such Defaulted Account and (b) the Allocation
Percentage on the day such Account became a Defaulted Account.

 

“Investor Finance
Charge Collections” means, for any Monthly Period, an amount equal to the aggregate amount of Finance Charge Collections
allocated to the Series issued pursuant to this Indenture Supplement pursuant to Section 4.3(a) for all Dates of Processing during
such Monthly Period.

 

“Investor Principal
Collections” means, for any Monthly Period, (a) during the Revolving Period, amounts deposited by the holder(s) of the
Transferor Interest to the Collection Account in respect of Reallocated Principal Collections pursuant to Section 4.3(c),
and (b) during the Controlled Accumulation Period or the Early Amortization Period, an amount equal to the lesser of (i) the Required
Principal Deposit Amount for such Monthly Period and (ii) the aggregate amount of Principal Collections allocated to the Series
issued pursuant to this Indenture Supplement pursuant to Section 4.3(b) for all Dates of Processing during such Monthly
Period; provided, that for any Monthly Period in which the Early Amortization Period commences, the amount described in
this clause (ii) shall equal the sum of (x) the lesser of (A) the aggregate amount of Principal Collections allocated to
the Series issued pursuant to this Indenture Supplement pursuant to Section 4.3(b) for all Dates of Processing during any
portion of the Monthly Period preceding the date on which the Early Amortization Period commences and (B) the Required Principal
Deposit Amount during the portion of such Monthly Period preceding the date on which the Early Amortization Period commences, plus
(y) the aggregate amount of Principal Collections allocated to the Series issued pursuant to this Indenture Supplement pursuant
to Section 4.3(b) for all Dates of Processing during any portion of the Monthly Period on and after the commencement of
the Early Amortization Period.

 

“Investor Uncovered
Dilution Amount” means, for any Monthly Period, an amount equal to the product of (a) the Series Allocation Percentage
for such Monthly Period (which with respect to any Monthly Period in which a Reset Date occurs during that Monthly Period will
be the daily average of the Series Allocation Percentages for all dates during such Monthly Period) and (b) the aggregate Dilutions
occurring during such Monthly Period as to which any deposit is required to be made hereunder but has not been made, provided,
that if the Free Equity Amount is greater than zero at the time the deposit referred to in clause (b) is required to be
made, the Investor Uncovered Dilution Amount shall be deemed to be zero.

 

“Issuer”
is defined in the preamble.

 

“Maximum Delinquency
Percentage” means, for purposes of Series 2016-3, 9%.

 

“Minimum Free
Equity Percentage” means, for purposes of Series 2016-3, 5.5%.

 

    	 	9	 

     

    

 

“Monthly Interest”
means, for any Payment Date, the sum of the Class A Monthly Interest, the Class B Monthly Interest, the Class C Monthly Interest
and the Class D Monthly Interest for such Payment Date.

 

“Monthly Period”
means, as to the November 2016 Payment Date, the period beginning on the Closing Date and ending on October 21, 2016, and as to
each Payment Date thereafter, the period beginning on the 22nd day of the second preceding calendar month and ending
on the 21st day of the immediately preceding calendar month.

 

“Monthly Principal”
is defined in Section 4.1(e).

 

“Monthly Principal
Reallocation Amount” means, for any Monthly Period, an amount equal to the sum of:

 

(a)          the
lesser of (i) the Class A Required Amount and (ii) 27.00% of the Initial Collateral Amount minus the sum of (x) the amount
of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed
Reallocated Principal Collections (as of the previous Payment Date) and (y) any reductions to the Collateral Amount pursuant to
Section 4.4(f), but not less than zero;

 

(b)          the
lesser of (i) the Class B Required Amount and (ii) 20.00% of the Initial Collateral Amount minus the sum of (x) the amount
of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed
Reallocated Principal Collections (as of the previous Payment Date and as required in clause (a) above) and (y) any reductions
to the Collateral Amount pursuant to Section 4.4(f), but not less than zero;

 

(c)          the
lesser of (i) the Class C Required Amount and (ii) 14.00% of the Initial Collateral Amount minus the sum of (x) the amount
of unreimbursed Investor Charge-Offs (after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed
Reallocated Principal Collections (as of the previous Payment Date and as required in clauses (a) and (b) above)
and (y) any reductions to the Collateral Amount pursuant to Section 4.4(f), but not less than zero; and

 

(d)          the
lesser of (i) the Class D Required Amount and (ii) 5.00% of the Initial Collateral Amount minus the sum of (x) the amount
of unreimbursed Investor Charge-Offs after giving effect to Investor Charge-Offs for the related Monthly Period) and unreimbursed
Reallocated Principal Collections (as of the previous Payment Date and as required in clauses (a), (b) and (c) above)
and (y) any reduction to the Collateral Amount pursuant to Section 4.4(f), but not less than zero.

 

“Note Principal
Balance” means, on any date of determination, an amount equal to the sum of the Class A Note Principal Balance, the Class
B Note Principal Balance, the Class C Note Principal Balance and the Class D Note Principal Balance.

 

    	 	10	 

     

    

 

“Noteholder Servicing
Fee” means, for any Transfer Date, an amount equal to one-twelfth of the product of (a) the Series Servicing Fee Percentage
and (b) the Collateral Amount as of the last day of the Monthly Period preceding such Transfer Date; provided, however,
that with respect to the first Transfer Date, the Noteholder Servicing Fee shall be calculated based on the Collateral Amount as
of the Closing Date and shall be pro rated for the number of days in the first Monthly Period.

 

“Payment Date”
means November 15, 2016 and the 15th day of each calendar month thereafter, or if such 15th day is not a
Business Day, the next succeeding Business Day.

 

“Portfolio Yield”
means, for any Monthly Period, the annualized percentage (based on a 360-day year of twelve 30-day months, or in the case of the
initial Monthly Period, the actual number of days and a 360-day year) equivalent of a fraction, (a) the numerator of which is equal
to the excess of (i) the Available Finance Charge Collections (excluding any Excess Finance Charge Collections), over (ii) the
Investor Default Amount and the Investor Uncovered Dilution Amount for such Monthly Period and (b) the denominator of which is
the Collateral Amount plus amounts on deposit in the Principal Accumulation Account, each as of the close of business on the last
day of such Monthly Period.

 

“Principal Account”
means the account designated as such, established and owned by the Issuer and maintained in accordance with Section 4.2.

 

“Principal Accumulation
Account” means the account designated as such, established and owned by the Issuer and maintained in accordance with
Section 4.2.

 

“Principal Accumulation
Account Balance” means, for any date of determination, the principal amount, if any, on deposit in the Principal Accumulation
Account on such date of determination.

 

“Principal Accumulation
Investment Proceeds” means, with respect to each Transfer Date, the investment earnings on funds in the Principal Accumulation
Account (net of investment expenses and losses) for the period from and including the immediately preceding Transfer Date to but
excluding such Transfer Date; provided, that for purposes of all calculations to be made prior to the related Payment Date
and the statement to be delivered pursuant to Section 5.2(a), the Servicer may estimate the amount of interest, earnings
and expenses on the Principal Accumulation Account based on the most recent statement delivered by the related deposit bank.

 

“Principal Shortfall”
is defined in Section 4.9.

 

“QIB”
means a qualified institutional buyer, within the meaning of Rule 144A under the Securities Act.

 

“Quarterly Excess
Spread Percentage” means (a) with respect to the January 2017 Payment Date, the percentage equivalent of a fraction the
numerator of which is the sum of (i) the Excess Spread Percentage for the Monthly Period relating to the December 2016 Payment
Date and (ii) the Excess Spread Percentage for the Monthly Period relating to the January 2017 Payment Date and the denominator
of which is two and (b) with respect to the February 2017 Payment Date and each Payment Date thereafter, the percentage equivalent
of a fraction the numerator of which is the sum of the Excess Spread Percentages determined with respect to the Monthly Periods
relating to such Payment Date and the immediately preceding two Payment Dates and the denominator of which is three.

 

    	 	11	 

     

    

 

“Rating Agency”
means, as of any date and with respect to any Class of the Series 2016-3 Notes, the nationally recognized statistical rating organizations
that have been requested by the Transferor to provide ratings of such Class and that are rating the Series 2016-3 Notes on such
date.

 

“Rating Agency
Condition” means, with respect to Series 2016-3 and any action, (i) with respect to any Class of the Series 2016-3 Notes
with respect to which S&P is a Rating Agency, if any, that S&P shall have notified the Issuer in writing that such action
will not result in a reduction or withdrawal of the rating, if any, of such Class (ii) with respect to any outstanding Class of
the Series 2016-3 Notes rated by any other Rating Agency, ten (10) days’ prior written notice (or, if ten (10) days’
advance notice is impracticable, as much advance notice as is practicable) is delivered electronically to each applicable Rating
Agency as provided in Section 8.7.

 

“Reallocated Principal
Collections” is defined in Section 4.7.

 

“Reassignment
Amount” means, with respect to Series 2016-3, the Redemption Amount.

 

“Redemption Amount”
means, for any Transfer Date, after giving effect to any deposits and payments otherwise to be made on the related Payment Date,
the sum of (i) the Note Principal Balance on such Payment Date, (ii) Monthly Interest for such Payment Date and any Monthly Interest
previously due but not distributed to the Series 2016-3 Noteholders and (iii) the amount of Additional Interest, if any, for the
related Payment Date and any Additional Interest previously due but not distributed to the Series 2016-3 Noteholders on a prior
Payment Date.

 

“Removal Date”
means a “Removal Date” as such term is defined in the Transfer Agreement.

 

“Required Deposit
Amount” means, with respect to the Series issued pursuant to this Indenture Supplement, for any Monthly Period, the sum
of (a) the Required Finance Charge Deposit Amount on such Date of Processing and (b) the Required Principal Deposit Amount on such
Date of Processing.

 

“Required Excess
Collateral Amount” means, at any time, 5.00% of the Collateral Amount; provided, that:

 

(a)          except
as provided in clause (c), the Required Excess Collateral Amount shall never be less than 3.00% of the Initial Collateral
Amount;

 

(b)          except
as provided in clause (c), the Required Excess Collateral Amount shall not decrease during an Early Amortization Period;
and

 

(c)          the
Required Excess Collateral Amount shall never be greater than the excess of the Note Principal Balance over the balance on deposit
in the Principal Accumulation Account.

 

    	 	12	 

     

    

 

“Required Finance
Charge Deposit Amount” means, with respect to the Series issued pursuant to this Indenture Supplement, for any Monthly
Period, the sum of (a) the fees payable to the Indenture Trustee, the Trustee and the Administrator on the related Payment Date,
(b) the Monthly Interest on the related Payment Date, (c) the Noteholder Servicing Fee, (d) if on such Date of Processing the Free
Equity Amount is less than the Minimum Free Equity Amount after giving effect to all transfers and deposits on that Date of Processing,
the Investor Default Amount and (e) any amount required to be deposited in the Reserve Account and the Spread Account on the related
Payment Date. To the extent any data needed to calculate the Required Finance Charge Deposit Amount is not available on any Date
of Processing, the Issuer shall use the corresponding data as most recently determined or other reasonable estimate of such data
until the required data is available (which shall be no later than the Transfer Date in the following Monthly Period). Without
limiting the foregoing, for purposes of determining the Investor Default Amount on any Date of Processing, the Investor Default
Amount shall be estimated based on the assumption that the Investor Default Amount for the current Monthly Period will equal the
Investor Default Amount for the prior Monthly Period multiplied by 1.25.

 

“Required Principal
Deposit Amount” means, with respect to the Series issued pursuant to this Indenture Supplement, for any Monthly Period,
an amount equal to (a) during the Revolving Period, zero, (b) during the Controlled Accumulation Period, the Controlled Deposit
Amount for the related Payment Date, and (c) during the Early Amortization Period, the Note Principal Balance, minus any amount
already on deposit in the Principal Accumulation Account.

 

“Required Reserve
Account Amount” means, for any Transfer Date on or after the Reserve Account Funding Date, an amount equal to (a) 0.50%
of the Note Principal Balance or (b) any other amount designated by the Issuer; provided, however, that if such designation
is of a lesser amount, the Issuer shall (i) provide the Indenture Trustee with evidence that the Rating Agency Condition shall
have been satisfied and (ii) deliver to the Indenture Trustee a certificate of an Authorized Officer to the effect that, based
on the facts known to such officer at such time, in the reasonable belief of the Issuer, such designation will not cause an Early
Amortization Event or an event that, after the giving of notice or the lapse of time, would cause an Early Amortization Event to
occur with respect to Series 2016-3; provided, further, however, that at any time during which the Controlled
Accumulation Period Length is equal to one month, the Required Reserve Account Amount shall be equal to $0.00.

 

“Required Spread
Account Amount” means, for the November 2016 Payment Date and the December 2016 Payment Date, zero, and for any Payment
Date thereafter, the product of (i) the Spread Account Percentage in effect on such date and (ii) during (x) the Revolving Period,
the Collateral Amount, and (y) during the Controlled Accumulation Period or the Early Amortization Period, the Collateral Amount
as of the last day of the Revolving Period; provided, that, prior to the occurrence of an Event of Default and acceleration
of the Series 2016-3 Notes, the Required Spread Account Amount will never exceed the Class D Note Principal Balance (after taking
into account any payments to be made on such Payment Date).

 

“Reserve Account”
means the account designated as such, established and owned by the Issuer and maintained in accordance with Section 4.2.

 

    	 	13	 

     

    

 

 

“Reserve Account
Funding Date” means the Payment Date selected by the Servicer on behalf of the Issuer which occurs not later than the
earliest of the Payment Date with respect to the Monthly Period which commences three months prior to the commencement of the Controlled
Accumulation Period (which commencement shall be subject to postponement pursuant to Section 4.13); provided, however,
that if the Rating Agency Condition is satisfied, the Issuer may postpone the Reserve Account Funding Date.

 

“Reserve Account
Surplus” means, as of any Transfer Date following the Reserve Account Funding Date, the amount, if any, by which the
amount on deposit in the Reserve Account exceeds the Required Reserve Account Amount, after giving effect to all deposits to and
withdrawals from the Reserve Account to occur on or prior to the related Payment Date.

 

“Reserve Draw
Amount” means, with respect to each Transfer Date relating to the Controlled Accumulation Period or the first Transfer
Date relating to the Early Amortization Period, the amount, if any, by which the Principal Accumulation Investment Proceeds for
such Payment Date are less than the Covered Amount determined as of such Transfer Date.

 

“Reset Date”
means:

 

(a)          each
Addition Date;

 

(b)          each
Removal Date on which, if any Series of Notes has been paid in full, Principal Receivables for that Series are removed from the
Trust;

 

(c)          each
date on which there is an increase in the outstanding balance of any Variable Interest; and

 

(d)          each
date on which a new Series or Class of Notes is issued.

 

“Revolving Period”
means the period beginning on the Closing Date and ending at the close of business on the day immediately preceding the earlier
of the day the Controlled Accumulation Period commences or the day the Early Amortization Period commences.

 

“Series Accounts”
means, collectively, the Finance Charge Account, the Principal Account, the Principal Accumulation Account, the Distribution Account,
the Reserve Account and the Spread Account.

 

“Series Allocation
Percentage” means, with respect to any Monthly Period, the percentage equivalent of a fraction, the numerator of which
is the numerator used in determining the Allocation Percentage for Finance Charge Collections for that Monthly Period and the denominator
of which is the sum of the numerators used in determining the Allocation Percentage for Finance Charge Collections for all outstanding
Series on such date of determination; provided, that if one or more Reset Dates occur in a Monthly Period, the Series Allocation
Percentage for the portion of the Monthly Period falling on and after each such Reset Date and prior to any subsequent Reset Date
will be determined using a denominator which is equal to the sum of the numerators used in determining the Allocation Percentage
for Finance Charge Collections for all outstanding Series as of the close of business on the subject Reset Date.

 

    	 	14	 

     

    

  

“Series Maturity
Date” means, with respect to Series 2016-3, the September 2022 Payment Date.

 

“Series Servicing
Fee Percentage” means 2% per annum.

 

“Series 2016-3”
means the Series of Notes the terms of which are specified in this Indenture Supplement.

 

“Series 2016-3
Early Amortization Event” is defined in Section 6.1.

 

“Series 2016-3
Excess Finance Charge Collections” means Excess Finance Charge Collections allocated from other Series in Group One to
Series 2016-3 pursuant to Section 8.6 of the Indenture.

 

“Series 2016-3
Note” means a Class A Note, a Class B Note, a Class C Note or a Class D Note.

 

“Series 2016-3
Noteholder” means a Class A Noteholder, a Class B Noteholder, a Class C Noteholder or a Class D Noteholder.

 

“Similar Law”
means any applicable law that is substantially similar to the fiduciary responsibility provisions of ERISA or Section 4975 of the
Code.

 

“Spread Account”
means the account designated as such, established and owned by the Issuer and maintained in accordance with Section 4.2.

 

“Spread Account
Deficiency” means the excess, if any, of the Required Spread Account Amount over the Available Spread Account Amount.

 

“Spread Account
Percentage” means, (i) 0% if the Quarterly Excess Spread Percentage on such Payment Date is greater than or equal to
5.00%, (ii) 2.00% if the Quarterly Excess Spread Percentage on such Payment Date is less than 5.00% and greater than or equal to
4.50%, (iii) 2.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 4.50% and greater than or equal
to 4.00%, (iv) 3.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 4.00% and greater than or equal
to 3.50%, (v) 4.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 3.50% and greater than or equal
to 3.00%, (vi) 5.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 3.00% and greater than or equal
to 2.50%, (vii) 6.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 2.50% and greater than or equal
to 1.50%, (viii) 7.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 1.50% and greater than or equal
to 0.50% and (ix) 8.50% if the Quarterly Excess Spread Percentage on such Payment Date is less than 0.50%.

 

“Surplus Collateral
Amount” means, with respect to any Payment Date, the excess, if any, of the Excess Collateral Amount over the Required
Excess Collateral Amount, in each case calculated after giving effect to any deposits into the Principal Accumulation Account and
payments of principal on such Payment Date, but before giving effect to any reduction in the Collateral Amount on such Payment
Date pursuant to Section 4.4(f).

 

    	 	15	 

     

    

  

“Trust”
is defined in the preamble.

 

SECTION 1.2. Incorporation
of Terms. The terms of the Indenture are incorporated in this Supplement as if set forth in full herein. As supplemented by
this Supplement, the Indenture is in all respects ratified and confirmed and both together shall be read, taken and construed as
one and the same agreement. If the terms of this Supplement and the terms of the Indenture conflict, the terms of this Supplement
shall control with respect to the Series 2016-3.

 

ARTICLE
II

Creation of the Series 2016-3 Notes

 

SECTION 2.1. Designation.

 

(a)          There
is hereby created and designated a Series of Notes to be issued pursuant to the Indenture and this Indenture Supplement to be known
as “Synchrony Credit Card Master Note Trust, Series 2016-3” or the “Series 2016-3 Notes.”
The Series 2016-3 Notes shall be issued in four Classes, known as the “Class A Series 2016-3 Fixed Rate Asset Backed Notes”,
the “Class B Series 2016-3 Fixed Rate Asset Backed Notes”, the “Class C Series 2016-3 Fixed Rate Asset
Backed Notes” and the “Class D Series 2016-3 Fixed Rate Asset Backed Notes.”

 

(b)          Series
2016-3 shall be included in Group One and shall be a Principal Sharing Series. Series 2016-3 shall be an Excess Allocation Series
with respect to Group One only. Series 2016-3 shall not be subordinated to any other Series.

 

(c)          The
Series 2016-3 Class A Notes shall be issued in minimum denominations of $100,000 and in integral multiples of $1,000 and the Class
B Notes, the Class C Notes and the Class D Notes shall be issued in minimum denominations of $100,000 and in integral multiples
of $1.

 

SECTION 2.2. Transfer
Restrictions Applicable to the Class C Notes and the Class D Notes.

 

(a)          The
Class C Notes and the Class D Notes have not been registered under the Securities Act or any state securities law. None of the
Issuer, the Note Registrar or the Indenture Trustee is obligated to register the Class C Notes or the Class D Notes under the Securities
Act or any other securities or “blue sky” laws or to take any other action not otherwise required under this Indenture
Supplement or the Trust Agreement to permit the transfer of any Class C Note or Class D Note without registration.

 

(b)          Until
such time as any such Class of Notes has been registered under the Securities Act and any applicable state securities law, the
Class C Notes and the Class D Notes may not be sold, transferred, assigned, participated, pledged or otherwise disposed of (any
such act, a “Class C Note Transfer” or “Class D Note Transfer,” as applicable) to any Person
except in accordance with the provisions of this Section 2.2, and any attempted Class C Note Transfer or Class D Note Transfer
in violation of this Section 2.2 will be null and void.

 

    	 	16	 

     

    

  

(c)          Each
Class C Note and Class D Note will bear a legend to the effect of the following unless determined otherwise by the Administrator
(as certified to the Indenture Trustee in an Officer’s Certificate) consistent with applicable law:

 

THIS NOTE HAS
NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY,
MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF
OR OF A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS NOTE:

 

		(1)	AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD,
TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER
REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING
FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE,
OR OTHER TRANSFER IS BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE
WITH ALL APPLICABLE SECURITIES LAWS OF THE UNITED STATES; AND

 

		(2)	AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN
IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

(d)          By
acceptance of any Class C Note or Class D Note, the Class C Noteholder or the Class D Noteholder specifically agrees with and represents
to the Transferor, the Issuer and the Note Registrar, that no Class C Note Transfer or Class D Note Transfer will be made unless
(i) the registration requirements of the Securities Act and any applicable state securities laws have been complied with, (ii)
such Class C Note Transfer or Class D Note Transfer is to the Transferor or its Affiliates or (iii) such Class C Note Transfer
or Class D Note Transfer is exempt from the registration requirements under the Securities Act because such Class C Note Transfer
or Class D Note Transfer is in compliance with Rule 144A under the Securities Act, to a transferee who the transferor reasonably
believes is a QIB that is purchasing for its own account or for the account of a QIB and to whom notice is given that such Class
C Note Transfer or Class D Note Transfer, as applicable, is being made in reliance upon Rule 144A under the Securities Act.

 

(e)          The
Issuer will make available to the prospective transferor and transferee of a Class C Note or Class D Note information requested
to satisfy the requirements of paragraph (d)(4) of Rule 144A.

 

    	 	17	 

     

    

  

(f)          Each
Class A Note, Class B Note, Class C Note and Class D Note will bear a legend to the effect of the following unless determined otherwise
by the Administrator (as certified to the Indenture Trustee in an Officer’s Certificate) consistent with applicable law:

 

THE HOLDER OF
THIS NOTE BY ITS ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, SHALL BE DEEMED TO REPRESENT AND WARRANT
THAT EITHER (I) SUCH HOLDER IS NOT (AND FOR SO LONG AS IT HOLDS SUCH NOTE WILL NOT BE), IS NOT ACTING ON BEHALF OF (AND FOR SO
LONG AS IT HOLDS SUCH NOTE WILL NOT BE ACTING ON BEHALF OF), AND IS NOT INVESTING THE ASSETS OF (A) AN “EMPLOYEE BENEFIT
PLAN” (AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”))
THAT IS SUBJECT TO TITLE I OF ERISA, (B) A “PLAN” (AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986,
AS AMENDED (THE “CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, (C) AN ENTITY WHOSE UNDERLYING ASSETS ARE DEEMED
TO BE PLAN ASSETS OF A PLAN DESCRIBED IN (A) OR (B) ABOVE (EACH, A “BENEFIT PLAN”) OR (D) A GOVERNMENTAL PLAN, CHURCH
PLAN OR NON-U.S. PLAN THAT IS SUBJECT TO ANY APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS
OF ERISA OR SECTION 4975 OF THE CODE (“SIMILAR LAW”) OR (II) ITS ACQUISITION, CONTINUED HOLDING AND DISPOSITION OF
THIS NOTE WILL NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION OF ANY
SIMILAR LAW. BENEFIT PLANS MAY NOT ACQUIRE THIS NOTE AT ANY TIME THAT THIS NOTE DOES NOT HAVE A CURRENT INVESTMENT GRADE RATING
FROM A NATIONALLY RECOGNIZED STATISTICAL RATING ORGANIZATION.

 

(g)          Any
Notes that were beneficially owned by the Issuer or the single beneficial owner of the Issuer for U.S. federal income tax purposes
as of the Closing Date, may not be transferred for U.S. federal income tax purposes to another Person (other than the single beneficial
owner of the Issuer for U.S. federal income tax purposes) unless the Administrator shall cause an opinion of nationally recognized
tax counsel to be delivered to the Administrator and Indenture Trustee to the effect that such Notes will be treated as debt for
U.S. federal income tax purposes. In addition, if for tax or other reasons it may be necessary to track such Notes (e.g., if the
Notes have original issue discount), tracking conditions such as requiring that such Notes be in definitive registered form may
be required by the Administrator as a condition to such transfer.

 

    	 	18	 

     

    

  

ARTICLE
III

REPRESENTATIONS, WARRANTIES and Covenants

 

SECTION 3.1. Representations,
Warranties and Covenants with respect to Receivables. The parties hereto agree that the representations, warranties and covenants
set forth in Schedule I shall be a part of this Indenture Supplement for all purposes.

 

SECTION 3.2. Representations,
Warranties and Covenants with respect to ERISA. By acquiring a Series 2016-3 Note (or interest therein), each purchaser and
subsequent transferee shall be deemed to represent and warrant that either (i) it is not (and for so long as it holds such Series
2016-3 Note will not be), is not acting on behalf of (and for so long as it holds such Series 2016-3 Note will not be acting on
behalf of), and is not investing the assets of a Benefit Plan or a governmental plan, church plan or non-U.S. plan that is subject
to any Similar Law or (ii) its acquisition, continued holding and disposition of such Series 2016-3 Note will not result in a non-exempt
prohibited transaction under ERISA or Section 4975 of the Code or a violation of any Similar Law. Benefit Plans may not acquire
the Series 2016-3 Notes at any time that the Series 2016-3 Notes do not have a current investment grade rating from a nationally
recognized statistical rating organization.

 

ARTICLE
IV

Rights of Series 2016-3 Noteholders and Allocation and Application of Collections

 

SECTION 4.1. Determination
of Interest and Principal.

 

(a)          The
amount of monthly interest (“Class A Monthly Interest”) due and payable with respect to the Class A Notes on
any Payment Date shall be an amount equal to the product of (i) a fraction, the numerator of which is 30 (but in the case of the
initial Interest Period, 53) and the denominator of which is 360, (ii) the Class A Note Interest Rate in effect with respect to
the related Interest Period and (iii) the Class A Note Principal Balance as of the close of business on the last day of the preceding
Monthly Period (or, with respect to the initial Payment Date, the Class A Note Initial Principal Balance).

 

With respect to each Payment
Date, the Issuer shall determine the excess, if any (the “Class A Deficiency Amount”), of (x) the aggregate
amount of Class A Monthly Interest payable pursuant to this Section 4.1(a) as of the prior Payment Date over (y)
the amount of Class A Monthly Interest actually paid on such Payment Date. If the Class A Deficiency Amount for any Payment Date
is greater than zero, on each subsequent Payment Date until such Class A Deficiency Amount is fully paid, an additional amount
(“Class A Additional Interest”) equal to the product of (i) a fraction, the numerator of which is 30 and the
denominator of which is 360, (ii) the Class A Note Interest Rate in effect with respect to the related Interest Period plus
2% per annum and (iii) such Class A Deficiency Amount (or the portion thereof which has not been paid to the Class A Noteholders)
shall be payable as provided herein with respect to the Class A Notes. Notwithstanding anything to the contrary herein, Class A
Additional Interest shall be payable or distributed to the Class A Noteholders only to the extent permitted by applicable law.

 

    	 	19	 

     

    

  

(b)          The
amount of monthly interest (“Class B Monthly Interest”) due and payable with respect to the Class B Notes on
any Payment Date shall be an amount equal to the product of (i) a fraction, the numerator of which is 30 (but in the case of the
initial Interest Period, 53) and the denominator of which is 360, (ii) the Class B Note Interest Rate in effect with respect to
the related Interest Period and (iii) the Class B Note Principal Balance as of the close of business on the last day of the preceding
Monthly Period (or, with respect to the initial Payment Date, the Class B Note Initial Principal Balance).

 

With respect to each Payment
Date, the Issuer shall determine the excess, if any (the “Class B Deficiency Amount”), of (x) the aggregate
amount of Class B Monthly Interest payable pursuant to this Section 4.1(b) as of the prior Payment Date over (y)
the amount of Class B Monthly Interest actually paid on such Payment Date. If the Class B Deficiency Amount for any Payment Date
is greater than zero, on each subsequent Payment Date until such Class B Deficiency Amount is fully paid, an additional amount
(“Class B Additional Interest”) equal to the product of (i) a fraction, the numerator of which is 30 and the
denominator of which is 360, (ii) the Class B Note Interest Rate in effect with respect to the related Interest Period plus
2% per annum and (iii) such Class B Deficiency Amount (or the portion thereof which has not been paid to the Class B Noteholders)
shall be payable as provided herein with respect to the Class B Notes. Notwithstanding anything to the contrary herein, Class B
Additional Interest shall be payable or distributed to the Class B Noteholders only to the extent permitted by applicable law.

 

(c)          The
amount of monthly interest (“Class C Monthly Interest”) due and payable with respect to the Class C Notes on
any Payment Date shall be an amount equal to the product of (i) a fraction, the numerator of which is 30 (but in the case of the
initial Interest Period, 53) and the denominator of which is 360, (ii) the Class C Note Interest Rate in effect with respect to
the related Interest Period and (iii) the Class C Note Principal Balance as of the close of business on the last day of the preceding
Monthly Period (or, with respect to the initial Payment Date, the Class C Note Initial Principal Balance).

 

With respect to each Payment
Date, the Issuer shall determine the excess, if any (the “Class C Deficiency Amount”), of (x) the aggregate
amount of Class C Monthly Interest payable pursuant to this Section 4.1(c) as of the prior Payment Date over (y)
the amount of Class C Monthly Interest actually paid on such Payment Date. If the Class C Deficiency Amount for any Payment Date
is greater than zero, on each subsequent Payment Date until such Class C Deficiency Amount is fully paid, an additional amount
(“Class C Additional Interest”) equal to the product of (i) a fraction, the numerator of which is 30 and the
denominator of which is 360, (ii) the Class C Note Interest Rate in effect with respect to the related Interest Period plus
2% per annum and (iii) such Class C Deficiency Amount (or the portion thereof which has not been paid to the Class C Noteholders)
shall be payable as provided herein with respect to the Class C Notes. Notwithstanding anything to the contrary herein, Class C
Additional Interest shall be payable or distributed to the Class C Noteholders only to the extent permitted by applicable law.

 

(d)          The
amount of monthly interest (“Class D Monthly Interest”) due and payable with respect to the Class D Notes on
any Payment Date shall be an amount equal to the product of (i) a fraction, the numerator of which is 30 (but in the case of the
initial Interest Period, 53) and the denominator of which is 360, (ii) the Class D Note Interest Rate in effect with respect to
the related Interest Period and (iii) the Class D Note Principal Balance as of the close of business on the last day of the preceding
Monthly Period (or, with respect to the initial Payment Date, the Class D Note Initial Principal Balance).

 

    	 	20	 

     

    

  

With respect to each Payment
Date, the Issuer shall determine the excess, if any (the “Class D Deficiency Amount”), of (x) the aggregate
amount of Class D Monthly Interest payable pursuant to this Section 4.1(d) as of the prior Payment Date over
(y) the amount of Class D Monthly Interest actually paid on such Payment Date. If the Class D Deficiency Amount for any Payment
Date is greater than zero, on each subsequent Payment Date until such Class D Deficiency Amount is fully paid, an additional amount
(“Class D Additional Interest”) equal to the product of (i) a fraction, the numerator of which is 30 and the
denominator of which is 360, (ii) the Class D Note Interest Rate in effect with respect to the related Interest Period plus
2% per annum and (iii) such Class D Deficiency Amount (or the portion thereof which has not been paid to the Class D Noteholders)
shall be payable as provided herein with respect to the Class D Notes. Notwithstanding anything to the contrary herein, Class D
Additional Interest shall be payable or distributed to the Class D Noteholders only to the extent permitted by applicable law.

 

(e)          The
amount of monthly principal to be transferred from the Principal Account with respect to the Notes on each Payment Date (the “Monthly
Principal”), beginning with the Payment Date in the Monthly Period following the Monthly Period in which the Controlled
Accumulation Period or, if earlier, the Early Amortization Period, begins, shall be equal to the least of (i) the Available Principal
Collections on deposit in the Principal Account with respect to the related Monthly Period, (ii) for each Payment Date with respect
to the Controlled Accumulation Period, the Controlled Deposit Amount for such Payment Date, (iii) the Collateral Amount (after
taking into account any adjustments to be made on such Payment Date pursuant to Sections 4.6 and 4.7) prior to any
deposit into the Principal Accumulation Account on such Payment Date and (iv) the Note Principal Balance, minus any amount already
on deposit in the Principal Accumulation Account on such Payment Date.

 

SECTION 4.2. Establishment
of Accounts.

 

(a)          As
of the Closing Date, the Issuer covenants to have established and shall thereafter maintain the Finance Charge Account, the Principal
Account, the Principal Accumulation Account, the Distribution Account, the Reserve Account and the Spread Account, each of which
shall be an Eligible Deposit Account.

 

(b)          If
the depositary institution wishes to resign as depositary of any of the Series Accounts for any reason or fails to carry out the
instructions of the Issuer for any reason, then the Issuer shall promptly notify the Indenture Trustee on behalf of the Noteholders.

 

(c)          On
or before the Closing Date, the Issuer shall enter into a depositary agreement to govern the Series Accounts pursuant to which
such accounts are continuously identified in the depositary institution’s books and records as subject to a security interest
in favor of the Indenture Trustee on behalf of the Noteholders and, except as may be expressly provided herein to the contrary,
in order to perfect the security interest of the Indenture Trustee on behalf of the Noteholders under the UCC, the Indenture Trustee
on behalf of the Noteholders shall have the power to direct disposition of the funds in the Series Accounts without further consent
by the Issuer; provided, however, that prior to the delivery by the Indenture Trustee on behalf of the Noteholders
of notice otherwise, the Issuer shall have the right to direct the disposition of funds in the Series Accounts; provided,
further, that the Indenture Trustee on behalf of the Noteholders agrees that it will not deliver such notice or exercise
its power to direct disposition of the funds in the Series Accounts unless an Event of Default has occurred and is continuing.

 

    	 	21	 

     

    

  

(d)          The
Issuer shall not close any of the Series Accounts unless it shall have (i) received the prior consent of the Indenture Trustee
on behalf of the Noteholders, (ii) established a new Eligible Deposit Account with the depositary institution or with a new depositary
institution satisfactory to the Indenture Trustee on behalf of the Noteholders, (iii) entered into a depositary agreement to govern
such new account(s) with such new depositary institution which agreement is satisfactory in all respects to the Indenture Trustee
on behalf of the Noteholders (whereupon such new account(s) shall become the applicable Series Account(s) for all purposes of this
Indenture Supplement) and (iv) taken all such action as the Indenture Trustee on behalf of the Noteholders shall reasonably require
to grant and perfect a first priority security interest in such account(s) under this Indenture Supplement.

 

SECTION 4.3. Calculations
and Series Allocations.

 

(a)          Allocations
of Finance Charge Collections. On each Date of Processing, the Issuer shall allocate to the Noteholders of the Series issued
pursuant to this Indenture Supplement an amount equal to the product of (A) the Allocation Percentage and (B) the aggregate Finance
Charge Collections processed on such Date of Processing. On or prior to 12:00 noon, New York City time, on each Transfer Date,
the Issuer shall transfer from the Collection Account to the Finance Charge Account, an amount equal to the lesser of the Investor
Finance Charge Collections for the preceding Monthly Period and the Required Finance Charge Deposit Amount for the preceding Monthly
Period.

 

(b)          Allocations
of Principal Collections. On each Date of Processing, the Issuer shall allocate to the Noteholders of the Series issued pursuant
to this Indenture Supplement an amount equal to the product of (A) the Allocation Percentage and (B) the aggregate amount of Principal
Collections processed on such Date of Processing. Principal Collections allocated to the Series issued pursuant to this Indenture
Supplement in excess of the Investor Principal Collections shall be treated as Shared Principal Collections. On or prior to 12:00
noon, New York City time, on each Transfer Date, the Issuer shall transfer from the Collection Account to the Principal Account,
an amount equal to the Available Principal Collections to the extent such funds have not been deposited into the Principal Account
pursuant to Section 4.4(a) or any other provision of this Agreement.

 

    	 	22	 

     

    

  

(c)          Calculations
and Additional Deposits. With respect to each Monthly Period falling in the Revolving Period, to the extent that Principal
Collections allocated to the Noteholders of the Series issued pursuant to this Indenture Supplement pursuant to Section 4.3(b)
are paid to the holders(s) of the Transferor Interest, the Issuer shall cause the holder(s) of the Transferor Interest to make
an amount equal to the Reallocated Principal Collections for the related Transfer Date available on or prior to the related Payment
Date for application in accordance with Section 4.7. Notwithstanding the provisions of Section 8.4(a) of the Indenture
allowing Collections for any Monthly Period in excess of the Aggregate Required Deposit Amount for such Monthly Period to be distributed
to the holder(s) of the Transferor Interest, (1) “Reallocated Principal Collections” for the related Transfer
Date shall be calculated as if the full amount of Finance Charge Collections allocated to the Series issued pursuant to this Indenture
Supplement during that Monthly Period had been deposited in the Collection Account and applied as Available Finance Charge Collections
on the related Payment Date in accordance with Section 4.4(a) and (2) Collections of Finance Charge Receivables allocated
to the Series issued pursuant to this Indenture Supplement during that Monthly Period that were released to the holder(s) of the
Transferor Interest pursuant to Section 8.4(a) of the Indenture shall be deemed, for purposes of all calculations under this Indenture
Supplement, to have been applied as Available Finance Charge Collections to the items specified in Section 4.4(a) to which
such amounts would have been applied (and in the priority in which they would have been applied) had such amounts been available
in the Collection Account on the related Payment Date. To avoid doubt, the calculations referred to in clause (2) of the preceding
sentence include the calculations required by clause (b)(iv) of the definition of Collateral Amount. If on any Transfer
Date the Free Equity Amount is less than the Minimum Free Equity Amount after giving effect to all transfers and deposits to occur
on or prior to the related Payment Date, the Issuer shall cause the holder(s) of the Transferor Interest, on or prior to the related
Payment Date, to deposit into the Principal Account funds in an amount equal to the amounts of Available Finance Charge Collections
that are required to be treated as Available Principal Collections pursuant to Sections 4.4(a)(vii), (viii) and (xi)
but are not available from funds in the Finance Charge Account as a result of the release of Collections to the holder(s) of the
Transferor Interest pursuant to Section 8.4(a) of the Indenture.

 

(d)          Notwithstanding
anything to the contrary contained in the Agreement, (i) funds required to be deposited into the Finance Charge Account or Principal
Account pursuant to this Indenture Supplement that would be subsequently transferred to the Distribution Account may instead be
directly deposited to the Distribution Account, and (ii) any funds required to be deposited into the Finance Charge Account or
Principal Account pursuant to this Indenture Supplement that would be subsequently transferred to the Issuer or the holder(s) of
the Transferor Interest shall not be required to be transferred to any Series Account and may be directly paid to the Issuer or
the holder(s) of the Transferor Interest pursuant to the priority of payments set forth in this Indenture Supplement.

 

(e)          Allocations
of Interchange. Notwithstanding anything to the contrary in Section 4.3(a) or the Indenture, Interchange for each Monthly Period
shall be allocated to the Noteholders of the Series issued pursuant to this Indenture Supplement based on the daily average of
the Allocation Percentages for Finance Charge Collections for all dates during such Monthly Period, and shall be deposited into
the Collection Account not later 12:00 noon, New York City time, on the Payment Date following the related Monthly Period.

 

SECTION 4.4. Application
of Available Finance Charge Collections and Available Principal Collections. On or prior to each Transfer Date or related Payment
Date, as applicable, the Issuer shall withdraw, to the extent of available funds, the amount required to be withdrawn from the
Finance Charge Account, the Principal Accumulation Account, the Principal Account and the Distribution Account as follows:

 

    	 	23	 

     

    

  

(a)          On
or prior to each Payment Date, an amount equal to the Available Finance Charge Collections with respect to the related Monthly
Period will be paid or deposited in the following priority:

 

(i)          to
pay, on a pari passu basis, the following amounts, to the extent allocated to Series 2016-3 pursuant to Section 8.4(d) of
the Indenture: (A) the payment to the Indenture Trustee of the accrued and unpaid fees and other amounts owed to the Indenture
Trustee up to a maximum amount of $25,000 for each calendar year, (B) the payment to the Trustee of the accrued and unpaid fees
and other amounts owed to the Trustee up to a maximum amount of $25,000 for each calendar year and (C) the payment to the Administrator
of the accrued and unpaid fees and other amounts owed to the Administrator up to a maximum amount of $25,000 for each calendar
year;

 

(ii)         an
amount equal to the Noteholder Servicing Fee for the related Transfer Date, plus the amount of any Noteholder Servicing
Fee previously due but not paid by the Issuer on a prior Payment Date, shall be paid to the Servicer;

 

(iii)        an
amount equal to Class A Monthly Interest for such Payment Date, plus any Class A Deficiency Amount, plus the amount
of any Class A Additional Interest for such Payment Date, plus the amount of any Class A Additional Interest previously
due but not paid to Class A Noteholders on a prior Payment Date, shall be deposited into the Distribution Account;

 

(iv)        an
amount equal to Class B Monthly Interest for such Payment Date, plus any Class B Deficiency Amount, plus the amount
of any Class B Additional Interest for such Payment Date, plus the amount of any Class B Additional Interest previously
due but not paid to Class B Noteholders on a prior Payment Date, shall be deposited into the Distribution Account;

 

(v)         an
amount equal to Class C Monthly Interest for such Payment Date, plus any Class C Deficiency Amount, plus the amount
of any Class C Additional Interest for such Payment Date, plus the amount of any Class C Additional Interest previously
due but not paid to Class C Noteholders on a prior Payment Date, shall be deposited into the Distribution Account;

 

(vi)        an
amount equal to Class D Monthly Interest for such Payment Date, plus any Class D Deficiency Amount, plus the amount
of any Class D Additional Interest for such Payment Date, plus the amount of any Class D Additional Interest previously
due but not paid to Class D Noteholders on a prior Payment Date shall be deposited into the Distribution Account;

 

(vii)       (A)
first, an amount equal to the Investor Default Amount for such Payment Date shall be treated as a portion of Available Principal
Collections for such Payment Date and (B) second, an amount equal to any Investor Uncovered Dilution Amount for such Payment
Date shall be treated as a portion of Available Principal Collections for such Payment Date, and any amounts treated as Available
Principal Collections pursuant to subclause (A) or (B) of this clause (vii) during the Controlled Accumulation
Period or the Early Amortization Period, shall be deposited into the Principal Account on the related Payment Date;

 

    	 	24	 

     

    

  

(viii)      an
amount equal to the sum of the aggregate amount of Investor Charge-Offs and the amount of Reallocated Principal Collections which
have not been previously reimbursed pursuant to this Section 4.4(a)(viii) shall be treated as a portion of Available Principal
Collections for such Payment Date and, during the Controlled Accumulation Period or Early Amortization Period, shall be deposited
into the Principal Account on the related Payment Date;

 

(ix)         on
each Transfer Date from and after the Reserve Account Funding Date, but prior to the date on which the Reserve Account terminates
as described in Section 4.10(e), an amount up to the excess, if any, of the Required Reserve Account Amount over
the Available Reserve Account Amount shall be deposited into the Reserve Account;

 

(x)          an
amount equal to the amounts required to be deposited in the Spread Account pursuant to Section 4.11(e) shall be deposited
into the Spread Account;

 

(xi)         without
duplication of the amount specified in clause (vii)(B) of this Section 4.4(a), an amount equal to the Series Allocation
Percentage (calculated by excluding all outstanding Series of Notes excluded from this calculation pursuant to the terms of the
Indenture Supplement for such Series) of the excess, if any, of the Minimum Free Equity Amount over the Free Equity Amount, shall
be treated as a portion of Available Principal Collections for such Payment Date and, during the Controlled Accumulation Period
or the Early Amortization Period, deposited into the Principal Account on the related Payment Date;

 

(xii)        [Reserved];

 

(xiii)       unless
an Early Amortization Event shall have occurred and be continuing, on a pari passu basis any amounts owed to such Persons listed
in clause (i) above that have been allocated to Series 2016-3 pursuant to Section 8.4(d) of the Indenture and that
have not been paid pursuant to clause (i) above shall be paid to such Persons; and

 

(xiv)      the
balance, if any, will constitute a portion of Excess Finance Charge Collections for such Payment Date and will be applied in accordance
with Section 8.6 of the Indenture; provided, that during an Early Amortization Period, if any such Excess Finance
Charge Collections would be paid to the Transferor in accordance with Section 8.6 of the Indenture, the portion of such
Excess Finance Charge Collections that would otherwise be payable to the Transferor, first shall be used to pay Monthly
Principal pursuant to Section 4.4(c) to the extent not paid in full from Available Principal Collections (calculated without
regard to amounts available to be treated as Available Principal Collections pursuant to this clause (xiv)), second,
shall be used to pay on a pari passu basis any amounts owed to such Persons listed in clause (i) above that have been allocated
to Series 2016-3 pursuant to Section 8.4(d) of the Indenture and that have not been paid pursuant to clauses (i)
and (xiii) above, and, third, any amounts remaining after payment in full of the Monthly Principal and amounts owed
to such Persons listed in clause (i) above shall be paid to the Issuer.

 

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(b)          On
or prior to each Transfer Date with respect to the Revolving Period, an amount equal to the Available Principal Collections for
the related Monthly Period shall be treated as Shared Principal Collections and allocated in accordance with Section 8.5
of the Indenture.

 

(c)          On
or prior to each Transfer Date or Payment Date, as applicable, with respect to the Controlled Accumulation Period or the Early
Amortization Period, an amount equal to the Available Principal Collections for the related Monthly Period shall be paid or deposited
in the following order of priority:

 

(i)          during
the Controlled Accumulation Period, an amount equal to the Monthly Principal for each Transfer Date shall be deposited into the
Principal Accumulation Account on the related Payment Date;

 

(ii)         during
the Early Amortization Period, an amount equal to the Monthly Principal for each Transfer Date shall be deposited into the Distribution
Account on the related Payment Date and on such Payment Date shall be paid, first to the Class A Noteholders on the related
Payment Date until the Class A Note Principal Balance has been reduced to zero; second to the Class B Noteholders until
the Class B Note Principal Balance has been reduced to zero; third to the Class C Noteholders until the Class C Note Principal
Balance has been reduced to zero; and fourth to the Class D Noteholders until the Class D Note Principal Balance has been
reduced to zero; and

 

(iii)        the
balance of such Available Principal Collections remaining after application in accordance with clauses (i) and (ii)
above shall be treated as Shared Principal Collections and applied in accordance with Section 8.5 of the Indenture.

 

(d)          On
each Payment Date, the Issuer shall pay in accordance with Section 4.5 to the Class A Noteholders from the Distribution
Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(iii) on such Payment Date, to the
Class B Noteholders from the Distribution Account, the amount deposited into the Distribution Account pursuant to Section 4.4(a)(iv)
on such Payment Date, to the Class C Noteholders from the Distribution Account, the amount deposited into the Distribution Account
pursuant to Section 4.4(a)(v) on such Payment Date and to the Class D Noteholders from the Distribution Account, the amount
deposited into the Distribution Account pursuant to Section 4.4(a)(vi) on such Payment Date.

 

(e)          On
the earlier to occur of (i) the first Payment Date with respect to the Early Amortization Period and (ii) the Expected Principal
Payment Date, the Issuer shall withdraw from the Principal Accumulation Account and deposit into the Distribution Account the amount
deposited into the Principal Accumulation Account pursuant to Section 4.4(c)(i) and on such Payment Date shall pay such
amount first to the Class A Noteholders, until the Class A Note Principal Balance is paid in full; second to the
Class B Noteholders, until the Class B Note Principal Balance is paid in full; third to the Class C Noteholders until the
Class C Principal Balance is paid in full; and fourth to the Class D Noteholders until the Class D Note Principal Balance
is paid in full.

 

    	 	26	 

     

    

  

(f)          As
of any Payment Date during the Controlled Accumulation Period or Early Amortization Period on which Principal Collections allocated
to the Series issued pursuant to this Indenture Supplement are treated as Shared Principal Collections, the Collateral Amount shall
be reduced by an amount equal to the lesser of (x) the amount of Principal Collections allocated to the Series issued pursuant
to this Indenture Supplement that are applied as Shared Principal Collections and (y) the Surplus Collateral Amount.

 

SECTION 4.5. Distributions.

 

(a)          On
each Payment Date, the Issuer shall pay to each Class A Noteholder of record on the related Record Date such Class A Noteholder’s
pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Payment
Date and as are payable to the Class A Noteholders pursuant to this Indenture Supplement.

 

(b)          On
each Payment Date, the Issuer shall pay to each Class B Noteholder of record on the related Record Date such Class B Noteholder’s
pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Payment
Date and as are payable to the Class B Noteholders pursuant to this Indenture Supplement.

 

(c)          On
each Payment Date, the Issuer shall pay to each Class C Noteholder of record on the related Record Date such Class C Noteholder’s
pro rata share of the amounts on deposit in the Distribution Account that are allocated and available on such Payment
Date and as are payable to the Class C Noteholders pursuant to this Indenture Supplement.

 

(d)          On
each Payment Date, the Issuer shall pay to each Class D Noteholder of record on the related Record Date such Class D Noteholder’s
pro rata share of the amounts on deposit in the Distribution Account (including amounts withdrawn from the Spread
Account (at the times and in the amounts specified in Section 4.11)) that are allocated and available on such Payment Date
and as are payable to the Class D Noteholders pursuant to this Indenture Supplement.

 

(e)          The
payments to be made pursuant to this Section 4.5 are subject to the provisions of Section 7.1 of this Indenture Supplement.

 

(f)          All
payments to Noteholders hereunder shall be made by (i) check mailed to each Series 2016-3 Noteholder (at such Noteholder’s
address as it appears in the Note Register), except that for any Series 2016-3 Notes registered in the name of the nominee of a
Clearing Agency, such payment shall be made by wire transfer of immediately available funds and (ii) except as provided in Section
2.7(b) of the Indenture, without presentation or surrender of any Series 2016-3 Note or the making of any notation thereon.

 

SECTION 4.6. Investor
Charge-Offs. On each Determination Date, the Issuer shall calculate the Investor Default Amount and any Investor Uncovered
Dilution Amount for the preceding Monthly Period. If, on any Transfer Date, the sum of the Investor Default Amount and any Investor
Uncovered Dilution Amount for the preceding Monthly Period exceeds the amount of Available Finance Charge Collections allocated
with respect thereto pursuant to Section 4.4(a)(vii) with respect to such Transfer Date, the Collateral Amount will be reduced
(but not below zero) by the amount of such excess (such reduction, an “Investor Charge-Off”).

 

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SECTION 4.7. Reallocated
Principal Collections. On each Transfer Date, the Issuer shall allocate Investor Principal Collections with respect to that
Transfer Date, to fund any deficiency pursuant to and in the priority set forth in Sections 4.4(a)(i), (ii), (iii),
(iv), (v) and (vi) on the related Payment Date (any such Investor Principal Collections so allocated, “Reallocated
Principal Collections”); provided, that for any Monthly Period, Reallocated Principal Collections may not exceed
the Monthly Principal Reallocation Amount for such Monthly Period. On each Transfer Date, the Collateral Amount shall be reduced
by the amount of Reallocated Principal Collections for such Transfer Date.

 

SECTION 4.8. Excess
Finance Charge Collections. Series 2016-3 shall be an Excess Allocation Series with respect to Group One only. Subject to Section 8.6
of the Indenture, Excess Finance Charge Collections with respect to the Excess Allocation Series in Group One with respect to any
Monthly Period will be allocated to Series 2016-3 in an amount equal to the product of (x) the aggregate amount of Excess Finance
Charge Collections with respect to all the Excess Allocation Series in Group One for such Monthly Period and (y) a fraction, the
numerator of which is the Finance Charge Shortfall for Series 2016-3 for such Monthly Period and the denominator of which is the
aggregate amount of Finance Charge Shortfalls for all the Excess Allocation Series in Group One, in each case with respect to payments
to be made on or prior to the Payment Date following such Monthly Period. The “Finance Charge Shortfall” for
Series 2016-3 for any date on which Excess Finance Charge Collections are allocated pursuant to Section 8.6 of the Indenture
will be equal to the excess, if any, of (a) the full amount required to be paid, without duplication, pursuant to Sections
4.4(a)(i) through (xiii) with respect to the next following Payment Date over (b) the Available Finance
Charge Collections with respect to the related Monthly Period (excluding any portion thereof attributable to Excess Finance Charge
Collections).

 

SECTION 4.9. Shared
Principal Collections. Subject to Section 8.5 of the Indenture, Shared Principal Collections allocable to Series
2016-3 with respect to any Monthly Period will be equal to the product of (x) the aggregate amount of Shared Principal Collections
with respect to all Principal Sharing Series for such Monthly Period and (y) a fraction, the numerator of which is the Principal
Shortfall for Series 2016-3 for such Monthly Period and the denominator of which is the aggregate amount of Principal Shortfalls
for all the Series which are Principal Sharing Series, in each case with respect to payments to be made on or prior to the Payment
Date following such Monthly Period. The “Principal Shortfall” for Series 2016-3 for any date on which Shared
Principal Collections are allocated pursuant to Section 8.5 of the Indenture will be equal to (a) for any allocation date
with respect to the Revolving Period or any allocation date during the Early Amortization Period prior to the earlier of (i) the
end of the Monthly Period immediately preceding the Expected Principal Payment Date and (ii) the date on which all outstanding
Series are in early amortization periods, zero, (b) for any allocation date with respect to the Controlled Accumulation Period,
the excess, if any, of the Controlled Deposit Amount with respect to the next following Payment Date over the amount of
Available Principal Collections for the related Monthly Period (excluding any portion thereof attributable to Shared Principal
Collections or amounts available to be treated as Available Principal Collections pursuant to clause (ix) of Section
4.4(a)) and (c) for any allocation date on or after the earlier of (i) the end of the Monthly Period immediately preceding
the Expected Principal Payment Date and (ii) the date on which all outstanding Series are in early amortization periods, the Note
Principal Balance.

 

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SECTION 4.10. Reserve
Account.

 

(a)          On
each Transfer Date, all interest and earnings (net of losses and investment expenses) accrued since the preceding Transfer Date
on funds on deposit in the Reserve Account shall be retained in the Reserve Account (to the extent that the Available Reserve Account
Amount is less than the Required Reserve Account Amount). Any remaining interest and earnings (net of losses and investment expenses)
shall be (i) deposited on or prior to the related Payment Date into the Finance Charge Account (to the extent such funds are needed
for distributions pursuant to Section 4.4(a)) and (ii) included in Available Finance Charge Collections for the related Monthly
Period. For purposes of determining the availability of funds or the balance in the Reserve Account for any reason under this Indenture
Supplement, except as otherwise provided in the preceding sentence, investment earnings on such funds shall be deemed not to be
available or on deposit.

 

(b)          On
or before each Transfer Date with respect to the Controlled Accumulation Period and on or before the first Transfer Date with respect
to the Early Amortization Period, the Issuer shall calculate the Reserve Draw Amount; provided, however, that such
amount will be reduced to the extent that funds otherwise would be available for deposit in the Reserve Account under Section 4.4(a)(ix)
on the following Payment Date.

 

(c)          If
for any Transfer Date the Reserve Draw Amount is greater than zero, the Reserve Draw Amount, up to the Available Reserve Account
Amount, shall be withdrawn from the Reserve Account on or prior to the related Payment Date by the Issuer and deposited into the
Finance Charge Account for application as Available Finance Charge Collections on the following Payment Date.

 

(d)          If
the Reserve Account Surplus on any Transfer Date is greater than zero, on or prior to the related Payment Date, the Indenture Trustee,
acting in accordance with the written instructions of the Issuer, shall withdraw from the Reserve Account an amount equal to such
Reserve Account Surplus and distribute any such amounts to the holders of the Transferor Interest.

 

(e)          Upon
the earliest to occur of (i) the termination of the Trust pursuant to Article VIII of the Trust Agreement, (ii) the
first Transfer Date relating to the Early Amortization Period and (iii) the Expected Principal Payment Date, the Issuer, after
the prior payment of all amounts owing to the Series 2016-3 Noteholders that are payable from the Reserve Account as provided herein,
shall withdraw from the Reserve Account all amounts, if any, on deposit in the Reserve Account and distribute any such amounts
to the holders of the Transferor Interest. The Reserve Account shall thereafter be deemed to have terminated for purposes of this
Indenture Supplement.

 

SECTION 4.11. Spread
Account.

 

(a)          On
or before each Payment Date, if the aggregate amount of Available Finance Charge Collections available for application pursuant
to Section 4.4(a)(vi) is less than the aggregate amount required to be deposited pursuant to Section 4.4(a)(vi),
the Issuer shall withdraw from the Spread Account the amount of such deficiency up to the Available Spread Account Amount and,
if the Available Spread Account Amount is less than such deficiency, Investment Earnings credited to the Spread Account, and shall
apply such amount in accordance with Section 4.4(a)(vi).

 

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(b)          Unless
an Early Amortization Event occurs, the Issuer will withdraw from the Spread Account and deposit in the Collection Account for
payment to the Class D Noteholders on the Expected Principal Payment Date for the Series 2016-3 Notes an amount equal to the lesser
of: (i) the amount on deposit in the Spread Account after application of any amounts set forth in clause (a) above and (ii)
the Class D Note Principal Balance.

 

(c)          Upon
an Early Amortization Event, the amount, if any, remaining on deposit in the Spread Account, after making the payments described
in clause (a) above, shall be applied to pay principal on the Class D Notes on the earlier of the Series Maturity Date and
the first Payment Date on which the Class A Note Principal Balance, the Class B Note Principal Balance and the Class C Note Principal
Balance have been paid in full.

 

(d)          On
any day following the occurrence of an Event of Default with respect to Series 2016-3 that has resulted in the acceleration of
the Series 2016-3 Notes, the Issuer shall withdraw from the Spread Account the Available Spread Account Amount and deposit such
amount in the Distribution Account for payment to the Series 2016-3 Notes in the following order of priority until all amounts
owed to such Noteholders have been paid in full: (i) the Class D Noteholders, (ii) the Class A Noteholders, (iii) the Class B Noteholders
and (iv) the Class C Noteholders.

 

(e)          If
on any Payment Date, after giving effect to all withdrawals from the Spread Account, the Available Spread Account Amount is less
than the Required Spread Account Amount then in effect, Available Finance Charge Collections shall be deposited into the Spread
Account pursuant to Section 4.4(a)(x) up to the amount of the Spread Account Deficiency.

 

(f)          If,
after giving effect to all deposits to and withdrawals from the Spread Account with respect to any Payment Date, the amount on
deposit in the Spread Account exceeds the Required Spread Account Amount, the Issuer shall withdraw an amount equal to such excess
from the Spread Account and distribute such amount to the Transferor. On the date on which the Class D Note Principal Balance has
been paid in full, after making any payments to the Noteholders required pursuant to Sections 4.11(a), (b), (c) and
(d), the Issuer shall withdraw from the Spread Account all amounts then remaining in the Spread Account and pay such amounts
to the holders of the Transferor Interest.

 

SECTION 4.12. Investment
of Accounts. (a) Except as provided in the following sentence, to the extent there are uninvested amounts deposited in the
Series Accounts, the Issuer shall cause such amounts to be invested in Permitted Investments selected by the Issuer that mature
no later than the following Transfer Date. To the extent there are uninvested amounts deposited into any Series Account on a Transfer
Date for distribution on the related Payment Date, the Issuer shall cause such amounts to be invested overnight in Permitted Investments
described in clause (b) of the definition of “Permitted Investments” held at the Indenture Trustee or at a depository
institution or trust company that has entered into an agreement with the Issuer and the Indenture Trustee in accordance with the
Custody and Control Agreement.

 

    	 	30	 

     

    

  

(b)          On
each Transfer Date with respect to the Controlled Accumulation Period and on the first Transfer Date with respect to the Early
Amortization Period, the Issuer shall transfer from the Principal Accumulation Account to the Finance Charge Account the Principal
Accumulation Investment Proceeds on deposit in the Principal Accumulation Account for application as Available Finance Charge Collections
in accordance with Section 4.4.

 

(c)          Principal
Accumulation Investment Proceeds (including reinvested interest) shall not be considered part of the amounts on deposit in the
Principal Accumulation Account for purposes of this Indenture Supplement.

 

(d)          On
each Transfer Date (but subject to Section 4.11(a)), the Investment Earnings, if any, credited since the preceding Transfer
Date on funds on deposit in the Spread Account shall be retained in the Spread Account (to the extent that the Available Spread
Account Amount is less than the Required Spread Account Amount) and, on or before the related Payment Date, the balance, if any,
shall be paid to the holders of the Transferor Interest. For purposes of determining the availability of funds or the balance in
the Spread Account for any reason under this Indenture Supplement (subject to Section 4.11(a)), all Investment Earnings
shall be deemed not to be available or on deposit; provided, that after the maturity of the Series 2016-3 Notes has been
accelerated as a result of an Event of Default, all Investment Earnings shall be added to the balance on deposit in the Spread
Account and treated like the rest of the Available Spread Account Amount.

 

SECTION 4.13. Controlled
Accumulation Period. The Controlled Accumulation Period is scheduled to commence on the first day of the third Monthly Period
preceding the Expected Principal Payment Date; provided, that if the Controlled Accumulation Period Length (determined as
described below) on any Determination Date is less than or more than the number of months in the scheduled Controlled Accumulation
Period, upon written notice to the Indenture Trustee, with a copy to each Rating Agency, the Issuer shall either postpone or accelerate,
as applicable, the date on which the Controlled Accumulation Period actually commences, so that, as a result, the number of Monthly
Periods in the Controlled Accumulation Period will equal the Controlled Accumulation Period Length; provided, that the length
of the Controlled Accumulation Period will not be less than one month. The “Controlled Accumulation Period Length”
will mean a number of whole months such that the amount available for payment of principal on the Notes on the Expected Principal
Payment Date is expected to equal or exceed the Note Principal Balance, assuming for this purpose that (1) the payment rate with
respect to Principal Collections remains constant at the lowest level of such payment rate during the twelve preceding Monthly
Periods, (2) the total amount of Principal Receivables in the Trust (and the principal amount on deposit in the Excess Funding
Account, if any) remains constant at the level on such date of determination, (3) no Early Amortization Event with respect to any
Series will subsequently occur and (4) no additional Series (other than any Series being issued on such date of determination)
will be subsequently issued. Any notice by Issuer modifying the commencement of the Controlled Accumulation Period pursuant to
this Section 4.13 shall specify (i) the Controlled Accumulation Period Length, (ii) the commencement date of the Controlled
Accumulation Period and (iii) the Controlled Accumulation Amount with respect to each Monthly Period during the Controlled Accumulation
Period.

 

SECTION 4.14. [Reserved].

 

    	 	31	 

     

    

  

SECTION 4.15. Deposit
of Collections. Notwithstanding anything to the contrary in the Indenture, for any Monthly Period during which the Issuer
is permitted to make a single monthly deposit to the Collection Account pursuant to Section 8.4 of the Indenture for such
Monthly Period, the Issuer need not make the daily deposits of Collections into the Collection Account as provided in Section
8.4 of the Indenture, but may make a single deposit in the Collection Account in immediately available funds not later than
12:00 noon, New York City time, on the related Payment Date.

 

ARTICLE
V

Delivery of Series 2016-3 Notes;

Reports to Series 2016-3 Noteholders

 

SECTION 5.1. Delivery
and Payment for the Series 2016-3 Notes.

 

The Issuer shall execute
and issue, and the Indenture Trustee shall authenticate, the Series 2016-3 Notes in accordance with Section 2.2 of
the Indenture. The Indenture Trustee shall deliver the Series 2016-3 Notes to or upon the written order of the Issuer when so authenticated.

 

SECTION 5.2. Reports
and Statements to Series 2016-3 Noteholders.

 

(a)          Not
later than the second Business Day preceding each Payment Date, the Issuer shall deliver or cause the Servicer to deliver to the
Trustee, the Indenture Trustee and each Rating Agency a statement substantially in the form of Exhibit B prepared by the
Servicer; provided, that the Issuer may amend the form of Exhibit B from time to time, with the prior written consent
of the Indenture Trustee.

 

(b)          A
copy of each statement or certificate provided pursuant to Section 5.2(a) may be obtained by any Series 2016-3 Noteholder
by a request in writing to the Issuer.

 

(c)          On
or before January 31 of each calendar year, beginning with January 31, 2017, the Issuer shall furnish or cause to be furnished
to each Person who at any time during the preceding calendar year was a Series 2016-3 Noteholder the information for the preceding
calendar year, or the applicable portion thereof during which the Person was a Noteholder, as is required to be provided by an
issuer of indebtedness under the Code to the holders of the Issuer’s indebtedness and such other customary information as
is necessary to enable such Noteholder to prepare its federal income tax returns. Notwithstanding anything to the contrary contained
in this Agreement, the Issuer shall, to the extent required by applicable law, from time to time furnish to the appropriate Persons,
at least five (5) Business Days prior to the end of the period required by applicable law, the information required to complete
a Form 1099-INT.

 

ARTICLE
VI

Series 2016-3 Early Amortization Events

 

SECTION 6.1. Series
2016-3 Early Amortization Events. If any one of the following events shall occur with respect to the Series 2016-3 Notes:

 

    	 	32	 

     

    

  

(a)          (i)
failure on the part of Transferor to make any payment or deposit required to be made by it by the terms of the Trust Receivables
Purchase Agreement or the Transfer Agreement on or before the date occurring five (5) Business Days after the date such payment
or deposit is required to be made therein or herein or (ii) failure of the Transferor duly to observe or perform in any material
respect any other of its covenants or agreements set forth in the Trust Receivables Purchase Agreement or the Transfer Agreement
which failure has a material adverse effect on the Series 2016-3 Noteholders and which continues unremedied for a period of sixty
(60) days after the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the
Transferor by the Indenture Trustee, or to the Transferor and the Indenture Trustee by any Noteholder of the Series 2016-3 Notes;

 

(b)          any
representation or warranty made by Transferor in the Transfer Agreement or the Trust Receivables Purchase Agreement or any information
contained in an account schedule required to be delivered by it pursuant to Section 2.1 or Section 2.6(c) of
the Transfer Agreement, Trust Agreement or the Bank Receivables Sale Agreement shall prove to have been incorrect in any material
respect when made or when delivered, which continues to be incorrect in any material respect for a period of sixty (60) days after
the date on which written notice of such failure, requiring the same to be remedied, shall have been given to the Transferor by
the Indenture Trustee, or to the Transferor and the Indenture Trustee by any Noteholder of the Series 2016-3 Notes and as a result
of which the interests of the Series 2016-3 Noteholders are materially and adversely affected for such period; provided,
however, that a Series 2016-3 Early Amortization Event pursuant to this Section 6.1(b) shall not be deemed to have occurred
hereunder if the Transferor has accepted reassignment of the related Transferred Receivable, or all of such Transferred Receivables,
if applicable, during such period in accordance with the provisions of the Transfer Agreement or the Trust Receivables Purchase
Agreement;

 

(c)          a
failure by Transferor under the Transfer Agreement to convey Transferred Receivables in Additional Accounts (as such term is defined
in the Transfer Agreement) or Participation Interests to the Trust when it is required to convey such Transferred Receivables pursuant
to Section 2.6(a) of the Transfer Agreement;

 

(d)          any
Servicer Default or any Indenture Servicer Default shall occur;

 

(e)          (i)
the average of the Portfolio Yields for the two Monthly Periods immediately preceding the January 2017 Payment Date is less than
the average of the Base Rates for the same Monthly Periods, or (ii) beginning with the three consecutive Monthly Periods immediately
preceding the February 2017 Payment Date, the average of the Portfolio Yields for three consecutive Monthly Periods is less than
the average of the Base Rates for the same Monthly Periods (for the avoidance of doubt, the Monthly Period preceding the November
2016 Payment Date shall be excluded for purposes of calculating the three-month average Portfolio Yield and Base Rate under this
clause (e)(ii));

 

(f)          the
Note Principal Balance shall not be paid in full on the Expected Principal Payment Date; or

 

(g)          without
limiting the foregoing, the occurrence of an Event of Default with respect to Series 2016-3 and acceleration of the maturity of
the Series 2016-3 Notes pursuant to Section 5.3 of the Indenture;

 

    	 	33	 

     

    

  

then, in the case of any event described in
subsection (a), (b) or (d), after the applicable grace period, if any, set forth in such subparagraphs, either
the Indenture Trustee or the holders of Series 2016-3 Notes evidencing more than 50% of the aggregate unpaid principal amount
of Series 2016-3 Notes by notice then given in writing to the Issuer (and to the Indenture Trustee if given by the Series 2016-3
Noteholders) may declare that a “Series Early Amortization Event” with respect to Series 2016-3 (a “Series
2016-3 Early Amortization Event”) has occurred as of the date of such notice, and, in the case of any event described
in subsection (c), (e), (f) or (g) a Series 2016-3 Early Amortization Event shall occur without any
notice or other action on the part of the Indenture Trustee or the Series 2016-3 Noteholders immediately upon the occurrence of
such event.

 

ARTICLE
VII

Redemption of Series 2016-3 Notes; Final Distributions; Series Termination

 

SECTION 7.1. Optional
Redemption of Series 2016-3 Notes; Final Distributions.

 

(a)          On
any day occurring on or after the date on which the outstanding principal balance of the Series 2016-3 Notes is reduced to 10%
or less of the initial outstanding principal balance of Series 2016-3 Notes, Transferor has the option pursuant to the Trust Agreement
to reduce the Collateral Amount to zero by paying a purchase price equal to the greater of (x) the Collateral Amount, plus the
applicable Allocation Percentage of outstanding Finance Charge Receivables and (y) a minimum amount equal to (i) if such day is
a Payment Date, the Redemption Amount for such Payment Date or (ii) if such day is not a Payment Date, the Redemption Amount for
the Payment Date following such day. If Transferor exercises such option, Issuer will apply such purchase price to repay the Notes
in full as specified below.

 

(b)          Issuer
shall give the Indenture Trustee at least thirty (30) days’ prior written notice of the date on which Transferor intends
to exercise such optional redemption. Not later than 12:00 noon, New York City time, on such day Transferor shall deposit into
the Distribution Account in immediately available funds the excess of the Redemption Amount over the amount, if any, on deposit
in the Principal Accumulation Account. Such redemption option is subject to payment in full of the Redemption Amount. Following
such deposit into the Distribution Account in accordance with the foregoing, the Collateral Amount for Series 2016-3 shall be reduced
to zero and the Series 2016-3 Noteholders shall have no further security interest in the Transferred Receivables. The Redemption
Amount shall be paid as set forth in Section 7.1(d).

 

(c)          (i)
The amount to be paid by the Transferor with respect to Series 2016-3 in connection with a reassignment of Transferred Receivables
to the Transferor pursuant to Section 6.1(f) of the Transfer Agreement shall not be less than the Redemption Amount
for the first Payment Date following the Monthly Period in which the reassignment obligation arises under the Transfer Agreement.

 

(ii)         The
amount to be paid by the Issuer with respect to Series 2016-3 in connection with a repurchase of the Notes pursuant to Section
10.1 of the Trust Agreement shall not be less than the Redemption Amount for the Payment Date of such repurchase.

 

    	 	34	 

     

    

 

 

(d)          With
respect to (i) the Redemption Amount deposited into the Distribution Account pursuant to this Section 7.1 or (ii) the
proceeds of any sale of Transferred Receivables pursuant to Section 5.3 of the Indenture with respect to Series 2016-3,
the Indenture Trustee shall, in accordance with the written direction of the Issuer, not later than 12:00 noon, New York City time,
on the related Payment Date, make payments of the following amounts (in the priority set forth below and, in each case, after giving
effect to any deposits and payments otherwise to be made on such date) in immediately available funds: (i) (x) the Class A Note
Principal Balance on such Payment Date will be paid to the Class A Noteholders and (y) an amount equal to the sum of (A) Class
A Monthly Interest due and payable on such Payment Date or any prior Payment Date, (B) any Class A Deficiency Amount for such
Payment Date and (C) the amount of Class A Additional Interest, if any, for such Payment Date and any Class A Additional Interest
previously due but not paid to the Class A Noteholders on any prior Payment Date, will be paid to the Class A Noteholders, (ii) (x)
the Class B Note Principal Balance on such Payment Date will be paid to the Class B Noteholders and (y) an amount equal to the
sum of (A) Class B Monthly Interest due and payable on such Payment Date or any prior Payment Date, (B) any Class B Deficiency
Amount for such Payment Date and (C) the amount of Class B Additional Interest, if any, for such Payment Date and any Class B Additional
Interest previously due but not paid to the Class B Noteholders on any prior Payment Date, will be paid to the Class B Noteholders,
(iii) (x) the Class C Note Principal Balance on such Payment Date will be paid to the Class C Noteholders and (y) an amount
equal to the sum of (A) Class C Monthly Interest due and payable on such Payment Date or any prior Payment Date, (B) any Class
C Deficiency Amount for such Payment Date and (C) the amount of Class C Additional Interest, if any, for such Payment Date and
any Class C Additional Interest previously due but not paid to the Class C Noteholders on any prior Payment Date, will be paid
to the Class C Noteholders, (iv) (x) the Class D Note Principal Balance on such Payment Date will be paid to the Class D Noteholders
and (y) an amount equal to the sum of (A) Class D Monthly Interest due and payable on such Payment Date or any prior Payment Date,
(B) any Class D Deficiency Amount for such Payment Date and (C) the amount of Class D Additional Interest, if any, for such Payment
Date and any Class D Additional Interest previously due but not paid to the Class D Noteholders on any prior Payment Date, will
be paid to the Class D Noteholders and (v) any excess shall be released to the Issuer.

 

SECTION 7.2. Series
Termination.

 

On the Series Maturity
Date, the unpaid principal amount of the Series 2016-3 Notes shall be due and payable.

 

SECTION 7.3. Sale of
Collateral.

 

If the Indenture Trustee
exercises its right to sell any portion of the Collateral in accordance with Section 5.16 of the Indenture upon the occurrence
of an Event of Default with respect to Series 2016-3, SYNCHRONY FINANCIAL shall have a right of first refusal to purchase any portion
of the Collateral for which the Indenture Trustee has received a bona fide offer from a third-party that is not an affiliate of
the Transferor at a price equal to the highest price bid for such Collateral by such third-party bidder.

 

    	 	35	 

     

    

  

ARTICLE
VIII

Miscellaneous Provisions

 

SECTION 8.1. Ratification
of Indenture; Amendments. As supplemented by this Indenture Supplement, the Indenture is in all respects ratified and confirmed
and the Indenture as so supplemented by this Indenture Supplement shall be read, taken and construed as one and the same instrument.
This Indenture Supplement may be amended only by a Supplemental Indenture entered in accordance with the terms of Section 9.1
or 9.2 of the Indenture. For purposes of the application of Section 9.2 to any amendment of this Indenture Supplement,
the Series 2016-3 Noteholders shall be the only Noteholders whose vote shall be required.

 

SECTION 8.2. Form of
Delivery of the Series 2016-3 Notes. The Class A Notes, the Class B Notes, the Class C Notes and the Class D Notes shall be
Book-Entry Notes and shall be delivered as provided in Sections 2.1 and 2.2 of the Indenture.

 

SECTION 8.3. Counterparts.
This Indenture Supplement may be executed in one or more counterparts, and by different parties on separate counterparts, each
of which shall be an original, but all of which shall constitute one and the same instrument.

 

SECTION 8.4. GOVERNING
LAW. (a) THIS INDENTURE SUPPLEMENT AND THE OBLIGATIONS ARISING HEREUNDER SHALL IN ALL RESPECTS, INCLUDING ALL MATTERS OF CONSTRUCTION,
VALIDITY AND PERFORMANCE, BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW
YORK (INCLUDING SECTION 5-1401(1) OF THE NEW YORK GENERAL OBLIGATIONS LAW, BUT WITHOUT REGARD TO ANY OTHER CONFLICT OF LAW PROVISIONS
THEREOF) AND ANY APPLICABLE LAWS OF THE UNITED STATES OF AMERICA. THIS INDENTURE SUPPLEMENT IS SUBJECT TO THE TRUST INDENTURE ACT
OF 1939, AS AMENDED, AND SHALL BE GOVERNED THEREBY AND CONSTRUED IN ACCORDANCE THEREWITH.

 

(b)          EACH
PARTY HERETO HEREBY CONSENTS AND AGREES THAT THE STATE OR FEDERAL COURTS LOCATED IN THE BOROUGH OF MANHATTAN IN NEW YORK CITY SHALL
HAVE EXCLUSIVE JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN THEM PERTAINING TO THIS INDENTURE SUPPLEMENT OR
TO ANY MATTER ARISING OUT OF OR RELATING TO THIS INDENTURE SUPPLEMENT; PROVIDED,
THAT EACH PARTY HERETO ACKNOWLEDGES THAT ANY APPEALS FROM THOSE COURTS MAY HAVE TO BE HEARD BY A COURT LOCATED OUTSIDE OF THE
BOROUGH OF MANHATTAN IN NEW YORK CITY; PROVIDED, FURTHER, THAT NOTHING IN THIS INDENTURE SUPPLEMENT SHALL BE DEEMED
OR OPERATE TO PRECLUDE THE INDENTURE TRUSTEE FROM BRINGING SUIT OR TAKING OTHER LEGAL ACTION IN ANY OTHER JURISDICTION TO REALIZE
ON THE COLLATERAL OR ANY OTHER SECURITY FOR THE NOTES, OR TO ENFORCE A JUDGMENT OR OTHER COURT ORDER IN FAVOR OF THE INDENTURE
TRUSTEE. EACH PARTY HERETO SUBMITS AND CONSENTS IN ADVANCE TO SUCH JURISDICTION IN ANY ACTION OR SUIT COMMENCED IN ANY SUCH COURT,
AND EACH PARTY HERETO HEREBY WAIVES ANY OBJECTION THAT SUCH PARTY MAY HAVE BASED UPON LACK OF PERSONAL JURISDICTION, IMPROPER VENUE
OR FORUM NON CONVENIENS AND HEREBY CONSENTS TO THE GRANTING OF SUCH LEGAL OR EQUITABLE RELIEF AS IS DEEMED APPROPRIATE BY
SUCH COURT. EACH PARTY HERETO HEREBY WAIVES PERSONAL SERVICE OF THE SUMMONS, COMPLAINT AND OTHER PROCESS ISSUED IN ANY SUCH ACTION
OR SUIT AND AGREES THAT SERVICE OF SUCH SUMMONS, COMPLAINT AND OTHER PROCESS MAY BE MADE BY REGISTERED OR CERTIFIED MAIL ADDRESSED
TO SUCH PARTY AT ITS ADDRESS DETERMINED IN ACCORDANCE WITH SECTION 10.4 OF THE INDENTURE AND THAT SERVICE SO MADE SHALL
BE DEEMED COMPLETED UPON THE EARLIER OF SUCH PARTY’S ACTUAL RECEIPT THEREOF OR THREE (3) DAYS AFTER DEPOSIT IN THE UNITED
STATES MAIL, PROPER POSTAGE PREPAID. NOTHING IN THIS SECTION SHALL AFFECT THE RIGHT OF ANY PARTY HERETO TO SERVE LEGAL PROCESS
IN ANY OTHER MANNER PERMITTED BY LAW.

 

    	 	36	 

     

    

  

BECAUSE DISPUTES ARISING
IN CONNECTION WITH COMPLEX FINANCIAL TRANSACTIONS ARE MOST QUICKLY AND ECONOMICALLY RESOLVED BY AN EXPERIENCED AND EXPERT PERSON
AND THE PARTIES WISH APPLICABLE STATE AND FEDERAL LAWS TO APPLY (RATHER THAN ARBITRATION RULES), THE PARTIES DESIRE THAT THEIR
DISPUTES BE RESOLVED BY A JUDGE APPLYING SUCH APPLICABLE LAWS. THEREFORE, TO ACHIEVE THE BEST COMBINATION OF THE BENEFITS OF THE
JUDICIAL SYSTEM AND OF ARBITRATION, THE PARTIES HERETO WAIVE ALL RIGHT TO TRIAL BY JURY IN ANY ACTION, SUIT, OR PROCEEDING BROUGHT
TO RESOLVE ANY DISPUTE, WHETHER SOUNDING IN CONTRACT, TORT OR OTHERWISE, ARISING OUT OF, CONNECTED WITH, RELATED TO, OR INCIDENTAL
TO THE RELATIONSHIP ESTABLISHED AMONG THEM IN CONNECTION WITH THIS INDENTURE SUPPLEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

 

SECTION 8.5. Limitation
of Liability. Notwithstanding any other provision herein or elsewhere, this Indenture Supplement has been executed and delivered
by BNY Mellon Trust of Delaware, not in its individual capacity, but solely in its capacity as Trustee of the Trust, in no event
shall BNY Mellon Trust of Delaware in its individual capacity have any liability in respect of the representations, warranties
or obligations of the Issuer hereunder or under any other document, as to all of which recourse shall be had solely to the assets
of the Trust, and for all purposes of this Indenture Supplement and each other document, the Trustee (as such or in its individual
capacity) shall be subject to, and entitled to the benefits of, the terms and provisions of the Trust Agreement.

 

SECTION 8.6. Rights
of the Indenture Trustee. The Indenture Trustee shall have herein the same rights, protections, indemnities and immunities
as specified in the Master Indenture.

 

SECTION 8.7. Notice
Address for Rating Agencies. Delivery of any notices required to be delivered to the Rating Agencies by the Issuer, the Indenture
Trustee or the Trustee shall be sufficient for the purposes of this Indenture Supplement and the other Related Documents if sent
to such mailing addresses or such email addresses as may be provided by the Rating Agencies.

 

    	 	37	 

     

    

  

SECTION 8.8. Compliance
with Applicable Anti-Terrorism and Anti-Money Laundering Regulations. In order to comply with laws, rules and regulations applicable
to banking institutions, including those relating to the funding of terrorist activities and money laundering, the Indenture Trustee
is required to obtain, verify and record certain information relating to individuals and entities which maintain a business relationship
with the Indenture Trustee. Accordingly, each of the parties hereto agrees to provide to the Indenture Trustee upon its request
from time to time such identifying information and documentation as may be available for such party in order to enable the Indenture
Trustee to comply with applicable law.

 

SECTION 8.9. Notes to
be Treated as Debt for Tax. It is the intent of the parties hereto that, for purposes of federal, state and local income and
franchise tax and any other tax measured in whole or in part by income, the Class A Notes, the Class B Notes, the Class C Notes
and the Class D Notes shall be treated as debt and a person purchasing such Notes agrees to treat such Notes as debt for such purposes.
Notwithstanding the foregoing and the Indenture, no party is bound to treat any Notes beneficially owned during any period of time
either by the Issuer or the single beneficial owner of the Issuer for U.S. federal income tax purposes as debt for the purposes
described in the preceding sentence.

 

SECTION 8.10. Deemed
Consent. The Series 2016-3 Noteholders will be deemed to have consented to any amendment to any Related Document that changes
the definition of “Rating Agency Condition” in such Related Document to match the definition of “Rating Agency
Condition” in this Indenture Supplement.

 

[SIGNATURE PAGE FOLLOWS]

 

    	 	38	 

     

    

 

IN WITNESS WHEREOF, the
undersigned have caused this Indenture Supplement to be duly executed and delivered by their respective duly authorized officers
on the day and year first above written.

 

	 	SYNCHRONY CREDIT CARD MASTER NOTE TRUST, as Issuer
	 	 	 
	 	By:	BNY Mellon Trust of Delaware, not in its individual capacity, but solely as Trustee on behalf of Issuer
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 
	 	DEUTSCHE BANK TRUST COMPANY AMERICAS, as Indenture Trustee
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:
	 	 	 
	 	By:  	 
	 	 	Name:
	 	 	Title:

 

Indenture Supplement

Series 2016-3

 

    	 	S-1	 

     

    

 

EXHIBIT A-1

 FORM OF CLASS A SERIES 2016-3 FIXED RATE
ASSET BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THE HOLDER OF THIS
NOTE BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE
INSTITUTED AGAINST THE ISSUER ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING
UNDER ANY FEDERAL OR STATE BANKRUPTCY LAW UNLESS NOTEHOLDERS OF NOT LESS THAN 662⁄3% OF THE OUTSTANDING PRINCIPAL AMOUNT OF
EACH CLASS OF EACH SERIES HAS APPROVED SUCH FILING AND IT WILL NOT DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED AGAINST
THE TRANSFEROR ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER ANY
FEDERAL OR STATE BANKRUPTCY LAW IN ANY INSTANCE; PROVIDED, THAT THE FOREGOING SHALL NOT IN ANY WAY LIMIT THE NOTEHOLDER’S
RIGHTS TO PURSUE ANY OTHER CREDITOR RIGHTS OR REMEDIES THAT THE NOTEHOLDERS MAY HAVE FOR CLAIMS AGAINST THE ISSUER.

 

THE HOLDER OF THIS CLASS
A NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS A NOTES (OTHER THAN
A NOTE beneficially owned during any period of time either by the Issuer or the single
beneficial owner of the Issuer for U.S. federal income tax purposes) AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL,
STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

    	 	Exhibit A-1 (Page 1)	 

     

    

  

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, SHALL BE DEEMED TO REPRESENT AND WARRANT THAT
EITHER (I) SUCH HOLDER IS NOT (AND FOR SO LONG AS IT HOLDS SUCH NOTE WILL NOT BE), IS NOT ACTING ON BEHALF OF (AND FOR SO LONG
AS IT HOLDS SUCH NOTE WILL NOT BE ACTING ON BEHALF OF), AND IS NOT INVESTING THE ASSETS OF (A) AN “EMPLOYEE BENEFIT PLAN”
(AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT
TO TITLE I OF ERISA, (B) A “PLAN” (AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
“CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, (C) AN ENTITY WHOSE UNDERLYING ASSETS ARE DEEMED TO BE PLAN ASSETS
OF A PLAN DESCRIBED IN (A) OR (B) ABOVE (EACH, A “BENEFIT PLAN”) OR (D) A GOVERNMENTAL PLAN, CHURCH PLAN OR NON-U.S.
PLAN THAT IS SUBJECT TO ANY APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”) OR (II) ITS ACQUISITION, CONTINUED HOLDING AND DISPOSITION OF THIS NOTE WILL
NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION OF ANY SIMILAR LAW. BENEFIT
PLANS MAY NOT ACQUIRE THIS NOTE AT ANY TIME THAT THIS NOTE DOES NOT HAVE A CURRENT INVESTMENT GRADE RATING FROM A NATIONALLY RECOGNIZED
STATISTICAL RATING ORGANIZATION.

 

    	 	Exhibit A-1 (Page 2)	 

     

    

 

	REGISTERED

No. R-______________	$700,000,000 

CUSIP NO. 87165L BJ9

 

SYNCHRONY
CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

CLASS A SERIES 2016-3 FIXED RATE ASSET BACKED NOTE

 

Synchrony Credit Card Master
Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by
a Trust Agreement dated as of September 25, 2003, for value received, hereby promises to pay to Cede & Co., or registered assigns,
subject to the following provisions, the principal sum of SEVEN HUNDRED MILLION DOLLARS, or such greater or lesser amount as determined
in accordance with the Indenture, on the September 2022 Payment Date, except as otherwise provided below or in the Indenture. The
Issuer will pay interest on the unpaid principal amount of this Note at the Class A Note Interest Rate on each Payment Date until
the Final Payment Date (which is the earlier to occur of (a) the Payment Date on which the Note Principal Balance is paid in full,
(b) the date on which the Collateral Amount is reduced to zero and (c) the September 2022 Payment Date). Interest on this Note
will accrue for each Payment Date from and including the most recent Payment Date on which interest has been paid to but excluding
such Payment Date or, for the initial Payment Date, from and including the Closing Date to but excluding such Payment Date. Interest
will be computed on the basis of a 360-day year and twelve 30-day months (and in the case of the initial interest period following
the Closing Date, for a period of 53 days). Principal of this Note shall be paid in the manner specified in the Indenture Supplement
referred to on the reverse hereof.

 

The principal of and interest
on this Note are payable 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.

 

Reference is made to the
further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.

 

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

 

    	 	Exhibit A-1 (Page 3)	 

     

    

  

IN WITNESS WHEREOF, the Issuer has caused this Class A Note to be
duly executed.

 

	 	SYNCHRONY CREDIT CARD MASTER NOTE TRUST, as Issuer
	 	 	 
	 	By:	
        BNY Mellon Trust
of Delaware, 

	 	 	not in its individual capacity but solely as
	 	 	Trustee on behalf of Issuer
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

Dated:  __________, _______

 

    	 	Exhibit A-1 (Page 4)	 

     

    

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class A Notes described in the within-mentioned
Indenture.

 

	 	
        DEUTSCHE BANK TRUST COMPANY

        AMERICAS, as Indenture Trustee

	 	 	 
	 	By:	 
	 	 	Authorized Signatory

 

    	 	Exhibit A-1 (Page 5)	 

     

    

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

CLASS A SERIES 2016-3 FIXED RATE ASSET BACKED NOTE

Summary of Terms and Conditions

 

This Class A Note is one
of a duly authorized issue of Notes of the Issuer, designated as Synchrony Credit Card Master Note Trust, Series 2016-3 (the “Series
2016-3 Notes”), issued under a Master Indenture dated as of September 25, 2003 (as amended, the “Master Indenture”),
between the Issuer and Deutsche Bank Trust Company Americas, as indenture trustee (the “Indenture Trustee”),
as supplemented by the Indenture Supplement, dated as of September 22, 2016 (the “Indenture Supplement”), and
representing the right to receive certain payments from the Issuer. The term “Indenture,” unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms
of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall
control.

 

The Class B Notes, the
Class C Notes and the Class D Notes will also be issued under the Indenture.

 

The Noteholder, by its
acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable
under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject
to any liability under the Indenture.

 

This Note does not purport
to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS A NOTE DOES
NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, GENERAL ELECTRIC CAPITAL CORPORATION, SYNCHRONY BANK, SYNCHRONY FINANCIAL, RFS
HOLDING, L.L.C., OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. THIS CLASS A NOTE IS LIMITED IN RIGHT OF PAYMENT TO CERTAIN COLLECTIONS OF THE RECEIVABLES
(AND CERTAIN OTHER COLLATERAL) ALLOCATED TO THE SERIES 2016-3 NOTES, ALL AS MORE SPECIFICALLY SET FORTH HEREINABOVE AND IN THE
MASTER INDENTURE AND INDENTURE SUPPLEMENT.

 

The Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee shall treat the person in whose name this Class A Note is registered
as the owner hereof for all purposes, and neither the Issuer, the Indenture Trustee nor any agent of the Issuer or the Indenture
Trustee shall be affected by notice to the contrary.

 

    	 	Exhibit A-1 (Page 6)	 

     

    

  

THIS CLASS A NOTE SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

    	 	Exhibit A-1 (Page 7)	 

     

    

 

ASSIGNMENT

 

Social Security or other identifying number of assignee  ________________________________________________

 

FOR VALUE RECEIVED, the
undersigned hereby sells, assigns and transfers unto                                  
(name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints
                            
attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	Dated:	 	 	 	**
	 	 	 	Signature Guaranteed:	 

 

 

		**	The signature to this assignment must correspond with the name of the registered owner as it appears
on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

    	 	Exhibit A-1 (Page 8)	 

     

    

 

EXHIBIT A-2

FORM OF CLASS B SERIES 2016-3 FIXED RATE ASSET
BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED
AGAINST THE ISSUER ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER
ANY FEDERAL OR STATE BANKRUPTCY LAW UNLESS NOTEHOLDERS OF NOT LESS THAN 662⁄3% OF THE OUTSTANDING PRINCIPAL AMOUNT OF EACH
CLASS OF EACH SERIES HAS APPROVED SUCH FILING AND IT WILL NOT DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED AGAINST
THE TRANSFEROR ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER ANY
FEDERAL OR STATE BANKRUPTCY LAW IN ANY INSTANCE; PROVIDED, THAT THE FOREGOING SHALL NOT IN ANY WAY LIMIT THE NOTEHOLDER’S
RIGHTS TO PURSUE ANY OTHER CREDITOR RIGHTS OR REMEDIES THAT THE NOTEHOLDERS MAY HAVE FOR CLAIMS AGAINST THE ISSUER.

 

THE HOLDER OF THIS CLASS B NOTE, BY ACCEPTANCE
OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS B NOTES (OTHER THAN A NOTE beneficially
owned during any period of time either by the Issuer or the single beneficial owner of the Issuer for U.S. federal income tax purposes)
AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER
TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

    	 	Exhibit A-2 (Page 1)	 

     

    

  

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, SHALL BE DEEMED TO REPRESENT AND WARRANT THAT
EITHER (I) SUCH HOLDER IS NOT (AND FOR SO LONG AS IT HOLDS SUCH NOTE WILL NOT BE), IS NOT ACTING ON BEHALF OF (AND FOR SO LONG
AS IT HOLDS SUCH NOTE WILL NOT BE ACTING ON BEHALF OF), AND IS NOT INVESTING THE ASSETS OF (A) AN “EMPLOYEE BENEFIT PLAN”
(AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT
TO TITLE I OF ERISA, (B) A “PLAN” (AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
“CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, (C) AN ENTITY WHOSE UNDERLYING ASSETS ARE DEEMED TO BE PLAN ASSETS
OF A PLAN DESCRIBED IN (A) OR (B) ABOVE (EACH, A “BENEFIT PLAN”) OR (D) A GOVERNMENTAL PLAN, CHURCH PLAN OR NON-U.S.
PLAN THAT IS SUBJECT TO ANY APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”) OR (II) ITS ACQUISITION, CONTINUED HOLDING AND DISPOSITION OF THIS NOTE WILL
NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION OF ANY SIMILAR LAW. BENEFIT
PLANS MAY NOT ACQUIRE THIS NOTE AT ANY TIME THAT THIS NOTE DOES NOT HAVE A CURRENT INVESTMENT GRADE RATING FROM A NATIONALLY RECOGNIZED
STATISTICAL RATING ORGANIZATION.

 

    	 	Exhibit A-2 (Page 2)	 

     

    

 

	REGISTERED

No. R-________________	$67,123,287

CUSIP NO. 87165L BK6

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

CLASS B SERIES 2016-3 FIXED RATE ASSET BACKED NOTE

 

Synchrony Credit Card Master
Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by
a Trust Agreement dated as of September 25, 2003, for value received, hereby promises to pay to Cede & Co., or registered assigns,
subject to the following provisions, the principal sum of SIXTY-SEVEN MILLION ONE HUNDRED TWENTY-THREE THOUSAND TWO HUNDRED EIGHTY-SEVEN
DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the September 2022 Payment Date, except
as otherwise provided below or in the Indenture. The Issuer will pay interest on the unpaid principal amount of this Note at the
Class B Note Interest Rate on each Payment Date until the Final Payment Date (which is the earlier to occur of (a) the Payment
Date on which the Note Principal Balance is paid in full, (b) the date on which the Collateral Amount is reduced to zero and (c)
the September 2022 Payment Date). Interest on this Note will accrue for each Payment Date from and including the most recent Payment
Date on which interest has been paid to but excluding such Payment Date or, for the initial Payment Date, from and including the
Closing Date to but excluding such Payment Date. Interest will be computed on the basis of a 360-day year and twelve 30-day months
(and in the case of the initial interest period following the Closing Date, for a period of 53 days). Principal of this Note shall
be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest
on this Note are payable 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.

 

Reference is made to the
further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.

 

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

 

THIS CLASS B NOTE IS SUBORDINATED
TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

    	 	Exhibit A-2 (Page 3)	 

     

    

  

IN WITNESS WHEREOF, the Issuer has caused this Class B Note to be
duly executed.

 

	 	SYNCHRONY CREDIT CARD MASTER NOTE 

TRUST, as Issuer
	 	 	 
	 	By:	BNY Mellon Trust of Delaware, not in its individual capacity but solely as
	 	 	Trustee on behalf of Issuer
	 	
	 	
        By: 
	 
	 	 	Name:
	 	 	Title:

 

Dated:  _____________, ______

 

    	 	Exhibit A-2 (Page 4)	 

     

    

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class B Notes described in the within-mentioned
Indenture.

 

	 	DEUTSCHE BANK TRUST COMPANY AMERICAS, as Indenture Trustee
	 	 	 
	 	
        By: 
	 
	 	 	Name:
	 	 	Title:

 

    	 	Exhibit A-2 (Page 5)	 

     

    

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

CLASS B SERIES 2016-3 FIXED RATE ASSET BACKED NOTE

Summary of Terms and Conditions

 

This Class B Note is one
of a duly authorized issue of Notes of the Issuer, designated as Synchrony Credit Card Master Note Trust, Series 2016-3 (the “Series
2016-3 Notes”), issued under a Master Indenture dated as of September 25, 2003 (as amended, the “Master Indenture”),
between the Issuer and Deutsche Bank Trust Company Americas, as indenture trustee (the “Indenture Trustee”),
as supplemented by the Indenture Supplement, dated as of September 22, 2016 (the “Indenture Supplement”), and
representing the right to receive certain payments from the Issuer. The term “Indenture,” unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms
of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall
control.

 

The Class A Notes, the
Class C Notes and the Class D Notes will also be issued under the Indenture.

 

The Noteholder, by its
acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable
under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject
to any liability under the Indenture.

 

This Note does not purport
to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS B NOTE DOES
NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, GENERAL ELECTRIC CAPITAL CORPORATION, SYNCHRONY BANK, SYNCHRONY FINANCIAL, RFS
HOLDING, L.L.C., OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. THIS CLASS B NOTE IS LIMITED IN RIGHT OF PAYMENT TO CERTAIN COLLECTIONS OF THE RECEIVABLES
(AND CERTAIN OTHER COLLATERAL) ALLOCATED TO THE SERIES 2016-3 NOTES, ALL AS MORE SPECIFICALLY SET FORTH HEREINABOVE AND IN THE
MASTER INDENTURE AND INDENTURE SUPPLEMENT.

 

The Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee shall treat the person in whose name this Class B Note is registered
as the owner hereof for all purposes, and neither the Issuer, the Indenture Trustee nor any agent of the Issuer or the Indenture
Trustee shall be affected by notice to the contrary.

 

    	 	Exhibit A-2 (Page 6)	 

     

    

  

THIS CLASS B NOTE SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

    	 	Exhibit A-2 (Page 7)	 

     

    

 

ASSIGNMENT

 

Social Security or other identifying number
of assignee ___________________________________________________

 

FOR VALUE RECEIVED, the
undersigned hereby sells, assigns and transfers unto                                  
(name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints
                            
attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	Dated:	 	 	 	**
	 	 	 	Signature Guaranteed:	 

 

 

		**	The signature to this assignment must correspond with the name of the registered owner as it appears
on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

    	 	Exhibit A-2 (Page 1)	 

     

    

 

EXHIBIT A-3

FORM OF CLASS C SERIES 2016-3 FIXED RATE ASSET
BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF
A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS NOTE:

 

		(1)	AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD,
TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE UNITED STATES; AND

 

		(2)	AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN
IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

    	 	Exhibit A-3 (Page 1)	 

     

    

  

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED
AGAINST THE ISSUER ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER
ANY FEDERAL OR STATE BANKRUPTCY LAW UNLESS NOTEHOLDERS OF NOT LESS THAN 662⁄3% OF THE OUTSTANDING PRINCIPAL AMOUNT OF EACH
CLASS OF EACH SERIES HAS APPROVED SUCH FILING AND IT WILL NOT DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED AGAINST
THE TRANSFEROR ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER ANY
FEDERAL OR STATE BANKRUPTCY LAW IN ANY INSTANCE; PROVIDED, THAT THE FOREGOING SHALL NOT IN ANY WAY LIMIT THE NOTEHOLDER’S
RIGHTS TO PURSUE ANY OTHER CREDITOR RIGHTS OR REMEDIES THAT THE NOTEHOLDERS MAY HAVE FOR CLAIMS AGAINST THE ISSUER.

 

THE HOLDER OF THIS CLASS
C NOTE, BY ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS C NOTES (OTHER THAN
A NOTE beneficially owned during any period of time either by the Issuer or the single
beneficial owner of the Issuer for U.S. federal income tax purposes) AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL,
STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, SHALL BE DEEMED TO REPRESENT AND WARRANT THAT
EITHER (I) SUCH HOLDER IS NOT (AND FOR SO LONG AS IT HOLDS SUCH NOTE WILL NOT BE), IS NOT ACTING ON BEHALF OF (AND FOR SO LONG
AS IT HOLDS SUCH NOTE WILL NOT BE ACTING ON BEHALF OF), AND IS NOT INVESTING THE ASSETS OF (A) AN “EMPLOYEE BENEFIT PLAN”
(AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT
TO TITLE I OF ERISA, (B) A “PLAN” (AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
“CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, (C) AN ENTITY WHOSE UNDERLYING ASSETS ARE DEEMED TO BE PLAN ASSETS
OF A PLAN DESCRIBED IN (A) OR (B) ABOVE (EACH, A “BENEFIT PLAN”) OR (D) A GOVERNMENTAL PLAN, CHURCH PLAN OR NON-U.S.
PLAN THAT IS SUBJECT TO ANY APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”) OR (II) ITS ACQUISITION, CONTINUED HOLDING AND DISPOSITION OF THIS NOTE WILL
NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION OF ANY SIMILAR LAW. BENEFIT
PLANS MAY NOT ACQUIRE THIS NOTE AT ANY TIME THAT THIS NOTE DOES NOT HAVE A CURRENT INVESTMENT GRADE RATING FROM A NATIONALLY RECOGNIZED
STATISTICAL RATING ORGANIZATION.

 

    	 	Exhibit A-3 (Page 2)	 

     

    

 

	REGISTERED

No. R-________________	$57,534,247

CUSIP NO. 87165L BL4

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

CLASS C SERIES 2016-3 FIXED RATE ASSET BACKED NOTE

 

Synchrony Credit Card Master
Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust governed by
a Trust Agreement dated as of September 25, 2003, for value received, hereby promises to pay to Cede & Co., or registered assigns,
subject to the following provisions, the principal sum of FIFTY-SEVEN MILLION FIVE HUNDRED THIRTY-FOUR THOUSAND TWO HUNDRED FORTY-SEVEN
DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the September 2022 Payment Date, except
as otherwise provided below or in the Indenture. The Issuer will pay interest on the unpaid principal amount of this Note at the
Class C Note Interest Rate on each Payment Date until the Final Payment Date (which is the earlier to occur of (a) the Payment
Date on which the Note Principal Balance is paid in full, (b) the date on which the Collateral Amount is reduced to zero and (c)
the September 2022 Payment Date). Interest on this Note will accrue for each Payment Date from and including the most recent Payment
Date on which interest has been paid to but excluding such Payment Date or, for the initial Payment Date, from and including the
Closing Date to but excluding such Payment Date. Interest will be computed on the basis of a 360-day year and twelve 30-day months
(and in the case of the initial interest period following the Closing Date, for a period of 53 days). Principal of this Note shall
be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest
on this Note are payable 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.

 

Reference is made to the
further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.

 

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

 

THIS CLASS C NOTE IS SUBORDINATED
TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES AND CLASS B NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE SUPPLEMENT.

 

    	 	Exhibit A-3 (Page 3)	 

     

    

  

IN WITNESS WHEREOF, the Issuer has caused this Class C Note to be
duly executed.

 

	 	SYNCHRONY CREDIT CARD MASTER NOTE TRUST, as Issuer
	 	 	 
	 	By:	 BNY Mellon Trust of Delaware, not in its individual capacity but solely as
	 	 	Trustee on behalf of Issuer
	 	 	 
	 	
        By: 
	 
	 	 	Name:
	 	 	Title:

 

Dated: __________, ____

 

    	 	Exhibit A-3 (Page 4)	 

     

    

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class C Notes described in the within-mentioned
Indenture.

 

	 	DEUTSCHE BANK TRUST COMPANY AMERICAS, as Indenture Trustee
	 	 	 
	 	
        By:

        
	 
	 	 	Name:
	 	 	Title:

 

    	 	Exhibit A-3 (Page 5)	 

     

    

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

CLASS C SERIES 2016-3 FIXED RATE ASSET BACKED NOTE

Summary of Terms and Conditions

 

This Class C Note is one
of a duly authorized issue of Notes of the Issuer, designated as Synchrony Credit Card Master Note Trust, Series 2016-3 (the “Series
2016-3 Notes”), issued under a Master Indenture dated as of September 25, 2003 (as amended, the “Master Indenture”),
between the Issuer and Deutsche Bank Trust Company Americas, as indenture trustee (the “Indenture Trustee”),
as supplemented by the Indenture Supplement, dated as of September 22, 2016 (the “Indenture Supplement”), and
representing the right to receive certain payments from the Issuer. The term “Indenture,” unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms
of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall
control.

 

The Class A Notes, the
Class B Notes and the Class D Notes will also be issued under the Indenture.

 

The Noteholder, by its
acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable
under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject
to any liability under the Indenture.

 

This Note does not purport
to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS C NOTE DOES
NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, GENERAL ELECTRIC CAPITAL CORPORATION, SYNCHRONY BANK, SYNCHRONY FINANCIAL, RFS
HOLDING, L.L.C., OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. THIS CLASS C NOTE IS LIMITED IN RIGHT OF PAYMENT TO CERTAIN COLLECTIONS OF THE RECEIVABLES
(AND CERTAIN OTHER COLLATERAL) ALLOCATED TO THE SERIES 2016-3 NOTES, ALL AS MORE SPECIFICALLY SET FORTH HEREINABOVE AND IN THE
MASTER INDENTURE AND INDENTURE SUPPLEMENT.

 

The Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee shall treat the person in whose name this Class C Note is registered
as the owner hereof for all purposes, and neither the Issuer, the Indenture Trustee nor any agent of the Issuer or the Indenture
Trustee shall be affected by notice to the contrary.

 

    	 	Exhibit A-3 (Page 6)	 

     

    

  

THIS CLASS C NOTE SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

    	 	Exhibit A-3 (Page 7)	 

     

    

 

ASSIGNMENT

 

Social Security or other identifying number of assignee ____________________________________________

 

FOR VALUE RECEIVED, the
undersigned hereby sells, assigns and transfers unto                                  
(name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints
                            
attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	Dated:	 	 	 	**
	 	 	 	Signature Guaranteed:	 

 

 

		**	The signature to this assignment must correspond with the name of the registered owner as it appears
on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

    	 	Exhibit A-3 (Page 8)	 

     

    

 

EXHIBIT A-4

 FORM OF CLASS D SERIES 2016-3 FIXED RATE
ASSET BACKED NOTE

 

UNLESS THIS NOTE IS PRESENTED
BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY NOTE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN
SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER
ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

THIS NOTE HAS NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY
NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED EXCEPT AS SET FORTH IN THE NEXT SENTENCE. BY ITS ACQUISITION HEREOF OR OF
A BENEFICIAL INTEREST HEREIN, THE HOLDER OF THIS NOTE:

 

		(1)	AGREES FOR THE BENEFIT OF THE ISSUER AND THE TRANSFEROR THAT THIS NOTE MAY BE SOLD,
TRANSFERRED, ASSIGNED, PARTICIPATED, PLEDGED OR OTHERWISE DISPOSED OF ONLY IN COMPLIANCE WITH THE SECURITIES ACT AND OTHER APPLICABLE
LAWS, AND ONLY (I) PURSUANT TO RULE 144A UNDER THE SECURITIES ACT (“RULE 144A”) TO A PERSON THAT THE HOLDER REASONABLY
BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER, WITHIN THE MEANING OF RULE l44A (A “QIB”), PURCHASING FOR ITS OWN ACCOUNT
OR FOR THE ACCOUNT OF A QIB, WHOM THE HOLDER HAS INFORMED, IN EACH CASE, THAT THE REOFFER, RESALE, PLEDGE, OR OTHER TRANSFER IS
BEING MADE IN RELIANCE ON RULE 144A, OR (II) TO THE DEPOSITOR OR ITS AFFILIATES, IN EACH CASE IN ACCORDANCE WITH ALL APPLICABLE
SECURITIES LAWS OF THE UNITED STATES; AND

 

		(2)	AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS NOTE OR AN INTEREST HEREIN
IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND.

 

    	 	Exhibit A-4 (Page 1)	 

     

    

 

 

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE HEREOF COVENANTS AND AGREES THAT IT WILL NOT AT ANY TIME DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED
AGAINST THE ISSUER ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER
ANY FEDERAL OR STATE BANKRUPTCY LAW UNLESS NOTEHOLDERS OF NOT LESS THAN 662⁄3% OF THE OUTSTANDING PRINCIPAL AMOUNT OF EACH
CLASS OF EACH SERIES HAS APPROVED SUCH FILING AND IT WILL NOT DIRECTLY OR INDIRECTLY INSTITUTE OR CAUSE TO BE INSTITUTED AGAINST
THE TRANSFEROR ANY BANKRUPTCY, REORGANIZATION, ARRANGEMENT, INSOLVENCY OR LIQUIDATION PROCEEDING OR OTHER PROCEEDING UNDER ANY
FEDERAL OR STATE BANKRUPTCY LAW IN ANY INSTANCE; PROVIDED, THAT THE FOREGOING SHALL NOT IN ANY WAY LIMIT THE NOTEHOLDER’S
RIGHTS TO PURSUE ANY OTHER CREDITOR RIGHTS OR REMEDIES THAT THE NOTEHOLDERS MAY HAVE FOR CLAIMS AGAINST THE ISSUER.

 

THE HOLDER OF THIS CLASS D NOTE, BY ACCEPTANCE
OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, AGREE TO TREAT THE CLASS D NOTES (OTHER THAN A NOTE beneficially
owned during any period of time either by the Issuer or the single beneficial owner of the Issuer for U.S. federal income tax purposes)
AS INDEBTEDNESS OF THE ISSUER FOR APPLICABLE FEDERAL, STATE, AND LOCAL INCOME AND FRANCHISE TAX LAW AND FOR PURPOSES OF ANY OTHER
TAX IMPOSED ON, OR MEASURED BY, INCOME.

 

THE HOLDER OF THIS NOTE
BY ITS ACCEPTANCE OF THIS NOTE, AND EACH HOLDER OF A BENEFICIAL INTEREST THEREIN, SHALL BE DEEMED TO REPRESENT AND WARRANT THAT
EITHER (I) SUCH HOLDER IS NOT (AND FOR SO LONG AS IT HOLDS SUCH NOTE WILL NOT BE), IS NOT ACTING ON BEHALF OF (AND FOR SO LONG
AS IT HOLDS SUCH NOTE WILL NOT BE ACTING ON BEHALF OF), AND IS NOT INVESTING THE ASSETS OF (A) AN “EMPLOYEE BENEFIT PLAN”
(AS DEFINED IN SECTION 3(3) OF THE EMPLOYEE RETIREMENT INCOME SECURITY ACT OF 1974, AS AMENDED (“ERISA”)) THAT IS SUBJECT
TO TITLE I OF ERISA, (B) A “PLAN” (AS DEFINED IN SECTION 4975 OF THE INTERNAL REVENUE CODE OF 1986, AS AMENDED (THE
“CODE”)) THAT IS SUBJECT TO SECTION 4975 OF THE CODE, (C) AN ENTITY WHOSE UNDERLYING ASSETS ARE DEEMED TO BE PLAN ASSETS
OF A PLAN DESCRIBED IN (A) OR (B) ABOVE (EACH, A “BENEFIT PLAN”) OR (D) A GOVERNMENTAL PLAN, CHURCH PLAN OR NON-U.S.
PLAN THAT IS SUBJECT TO ANY APPLICABLE LAW THAT IS SUBSTANTIALLY SIMILAR TO THE FIDUCIARY RESPONSIBILITY PROVISIONS OF ERISA OR
SECTION 4975 OF THE CODE (“SIMILAR LAW”) OR (II) ITS ACQUISITION, CONTINUED HOLDING AND DISPOSITION OF THIS NOTE WILL
NOT RESULT IN A NON-EXEMPT PROHIBITED TRANSACTION UNDER ERISA OR SECTION 4975 OF THE CODE OR A VIOLATION OF ANY SIMILAR LAW. BENEFIT
PLANS MAY NOT ACQUIRE THIS NOTE AT ANY TIME THAT THIS NOTE DOES NOT HAVE A CURRENT INVESTMENT GRADE RATING FROM A NATIONALLY RECOGNIZED
STATISTICAL RATING ORGANIZATION.

 

    	 	Exhibit A-4 (Page 2)	 

     

    

 

	REGISTERED

No. R-_____________	$86,301,370

CUSIP NO. 87165L BM2

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

 

CLASS D SERIES 2016-3 FIXED RATE ASSET BACKED
NOTE

 

Synchrony Credit Card Master
Note Trust (herein referred to as the “Issuer” or the “Trust”), a Delaware statutory trust
governed by a Trust Agreement dated as of September 25, 2003, for value received, hereby promises to pay to Cede & Co., or
registered assigns, subject to the following provisions, the principal sum of EIGHTY-SIX MILLION THREE HUNDRED ONE THOUSAND THREE
HUNDRED SEVENTY DOLLARS, or such greater or lesser amount as determined in accordance with the Indenture, on the September 2022
Payment Date, except as otherwise provided below or in the Indenture. The Issuer will pay interest on the unpaid principal amount
of this Note at the Class D Note Interest Rate on each Payment Date until the Final Payment Date (which is the earlier to occur
of (a) the Payment Date on which the Note Principal Balance is paid in full, (b) the date on which the Collateral Amount is reduced
to zero and (c) the September 2022 Payment Date). Interest on this Note will accrue for each Payment Date from and including the
most recent Payment Date on which interest has been paid to but excluding such Payment Date or, for the initial Payment Date, from
and including the Closing Date to but excluding such Payment Date. Interest will be computed on the basis of a 360-day year and
twelve 30-day months (and in the case of the initial interest period following the Closing Date, for a period of 53 days). Principal
of this Note shall be paid in the manner specified in the Indenture Supplement referred to on the reverse hereof.

 

The principal of and interest
on this Note are payable 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.

 

Reference is made to the
further provisions of this Note set forth on the reverse hereof, which shall have the same effect as though fully set forth on
the face of this Note.

 

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

 

THIS CLASS D NOTE IS SUBORDINATED
TO THE EXTENT NECESSARY TO FUND PAYMENTS ON THE CLASS A NOTES, CLASS B NOTES AND CLASS C NOTES TO THE EXTENT SPECIFIED IN THE INDENTURE
SUPPLEMENT.

 

    	 	Exhibit A-4 (Page 3)	 

     

    

 

IN WITNESS WHEREOF, the Issuer has caused this Class D Note to be
duly executed.

 

	 	SYNCHRONY CREDIT CARD MASTER NOTE TRUST, as Issuer
	 	 	 
	 	By:	BNY MELLON TRUST OF DELAWARE
	 	 	not in its individual capacity but solely as
	 	 	Trustee on behalf of Issuer
	 	 	 
	 	By:	 
	 	 	Name:
	 	 	Title:

 

Dated:  _____________, _______

 

    	 	Exhibit A-4 (Page 4)	 

     

    

 

INDENTURE TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

This is one of the Class D Notes described in the within-mentioned
Indenture.

 

	 	DEUTSCHE BANK TRUST COMPANY AMERICAS, as Indenture Trustee
	 	 	 
	 	By:	 
	 	 	Authorized Signatory

 

    	 	Exhibit A-4 (Page 5)	 

     

    

 

SYNCHRONY CREDIT CARD

MASTER NOTE TRUST SERIES 2016-3

 

CLASS D SERIES 2016-3 FIXED RATE ASSET BACKED
NOTE

Summary of Terms and Conditions

 

This Class D Note is one
of a duly authorized issue of Notes of the Issuer, designated as Synchrony Credit Card Master Note Trust, Series 2016-3 (the “Series
2016-3 Notes”), issued under a Master Indenture dated as of September 25, 2003 (as amended, the “Master Indenture”),
between the Issuer and Deutsche Bank Trust Company Americas, as indenture trustee (the “Indenture Trustee”),
as supplemented by the Indenture Supplement, dated as of September 22, 2016 (the “Indenture Supplement”), and
representing the right to receive certain payments from the Issuer. The term “Indenture,” unless the context otherwise
requires, refers to the Master Indenture as supplemented by the Indenture Supplement. The Notes are subject to all of the terms
of the Indenture. All terms used in this Note that are defined in the Indenture shall have the meanings assigned to them in or
pursuant to the Indenture. In the event of any conflict or inconsistency between the Indenture and this Note, the Indenture shall
control.

 

The Class A Notes, the
Class B Notes and the Class C Notes will also be issued under the Indenture.

 

The Noteholder, by its
acceptance of this Note, agrees that it will look solely to the property of the Issuer allocated to the payment of this Note for
payment hereunder and that neither the Owner Trustee nor the Indenture Trustee is liable to the Noteholders for any amount payable
under the Notes or the Indenture or, except in the case of the Indenture Trustee as expressly provided in the Indenture, subject
to any liability under the Indenture.

 

This Note does not purport
to summarize the Indenture and reference is made to the Indenture for the interests, rights and limitations of rights, benefits,
obligations and duties evidenced thereby, and the rights, duties and immunities of the Indenture Trustee.

 

THIS CLASS D NOTE DOES
NOT REPRESENT AN OBLIGATION OF, OR AN INTEREST IN, GENERAL ELECTRIC CAPITAL CORPORATION, SYNCHRONY BANK, SYNCHRONY FINANCIAL, RFS
HOLDING, L.L.C., OR ANY OF THEIR AFFILIATES, AND IS NOT INSURED OR GUARANTEED BY THE FEDERAL DEPOSIT INSURANCE CORPORATION OR ANY
OTHER GOVERNMENTAL AGENCY OR INSTRUMENTALITY. THIS CLASS D NOTE IS LIMITED IN RIGHT OF PAYMENT TO CERTAIN COLLECTIONS OF THE RECEIVABLES
(AND CERTAIN OTHER COLLATERAL) ALLOCATED TO THE SERIES 2016-3 NOTES, ALL AS MORE SPECIFICALLY SET FORTH HEREINABOVE AND IN THE
MASTER INDENTURE AND INDENTURE SUPPLEMENT.

 

The Issuer, the Indenture
Trustee and any agent of the Issuer or the Indenture Trustee shall treat the person in whose name this Class D Note is registered
as the owner hereof for all purposes, and neither the Issuer, the Indenture Trustee nor any agent of the Issuer or the Indenture
Trustee shall be affected by notice to the contrary.

 

    	 	Exhibit A-4 (Page 6)	 

     

    

  

THIS CLASS D NOTE SHALL
BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS, AND THE
OBLIGATIONS, RIGHTS AND REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

 

    	 	Exhibit A-4 (Page 7)	 

     

    

 

ASSIGNMENT

 

Social Security or other identifying number of assignee ____________________________________________________

 

FOR VALUE RECEIVED, the
undersigned hereby sells, assigns and transfers unto                                  
(name and address of assignee) the within certificate and all rights thereunder, and hereby irrevocably constitutes and appoints
                            
attorney, to transfer said certificate on the books kept for registration thereof, with full power of substitution in the premises.

 

	Dated:	 	 	 	**
	 	 	 	Signature Guaranteed:	 

 

 

		**	The signature to this assignment must correspond with the name of the registered owner as it appears
on the face of the within Note in every particular, without alteration, enlargement or any change whatsoever.

 

    	 	Exhibit A-4 (Page 8)	 

     

    

 

EXHIBIT B

 

FORM OF MONTHLY NOTEHOLDER’S STATEMENT

 

Monthly Noteholder’s Statement

Synchrony Credit Card Master Note Trust

 

Series 2016-3

Class A 1.58% Notes

Class B 1.91% Notes

Class C 2.30% Notes

Class D 2.95% Notes

 

Pursuant to the Master
Indenture, dated as of September 25, 2003 (as amended and supplemented, the “Indenture”) between Synchrony Credit
Card Master Note Trust (the “Issuer”) and Deutsche Bank Trust Company Americas, as indenture trustee (the “Indenture
Trustee”), as supplemented by the Series 2016-3 Indenture Supplement (the “Indenture Supplement”),
dated as of September 22, 2016, between the Issuer and the Indenture Trustee, the Issuer is required to prepare, or cause the Servicer
to prepare, certain information each month regarding current distributions to the Series 2016-3 Noteholders and the performance
of the Trust during the previous month. The information required to be prepared with respect to the Payment Date of [●], 20[●],
and with respect to the performance of the Trust during the Monthly Period ended [●], 20[●] is set forth below.
Capitalized terms used herein are defined in the Indenture and the Indenture Supplement. The Discount Percentage (as defined in
the Transfer Agreement) remains at 0% for all the Receivables in the Trust until otherwise indicated. The undersigned, an Authorized
Officer of the Servicer, does hereby certify as follows:

 

	Record Date:	[●], 20[●]
	Monthly Period Beginning:	[●], 20[●]
	Monthly Period Ending:	[●], 20[●]
	Previous Payment Date:	[●], 20[●]
	Payment Date:	[●], 20[●]
	Interest Period Beginning:	[●], 20[●]
	Interest Period Ending:	[●], 20[●]
	Days in Monthly Period:	[●]
	Days in Interest Period:	[●]
	Is there a Reset Date?	[No][Yes]

 

    	 	Exhibit B (Page 1)	 

     

    

		I.	Trust Receivables Information

	 	 	 
		a.	Number of Accounts Beginning

		b.	Number of Accounts Ending

		c.	Average Account Balance (q/b)

		d.	BOP Principal Receivables

		e.	BOP Finance Charge Receivables

		f.	BOP Total Receivables

		g.	Increase in Principal Receivables from Additional Accounts

		h.	Increase in Principal Activity on Existing Securitized Accounts

		i.	Increase in Finance Charge Receivables from Additional Accounts

		j.	Increase in Finance Charge Activity on Existing Securitized Accounts

		k.	Increase in Total Receivables

		l.	Decrease in Principal Receivables due to Account Removal

		m.	Decrease in Principal Activity on Existing Securitized Accounts

		n.	Decrease in Finance Charge Receivables due to Account Removal

		o.	Decrease in Finance Charge Activity on Existing Securitized Accounts

		p.	Decrease in Total Receivables

		q.	EOP Aggregate Principal Receivables

		r.	EOP Finance Charge Receivables

		s.	EOP Total Receivables

		t.	Excess Funding Account Balance

		u.	Required Principal Balance

		v.	Minimum Free Equity Amount (EOP Aggregate Principal Receivables * 5.5%)

		w.	Free Equity Amount (EOP Principal Receivables - EOP Collateral Amount (II.d.ii+II.a.ii+II.b.ii+II.b.iii))

 

		II.	Investor Information (Sum of all Series, excluding new issuances and additional draws subsequent to end of the Monthly Period)

	 	 	 
		a.	Note Principal Balance

		i.	Beginning of Interest Period

		ii.	Increase in Note Principal Balance due to New Issuance / Additional draws

		iii.	Decrease in Note Principal Balance due to Principal Paid and Notes Retired

		iv.	As of Payment Date

		b.	Excess Collateral Amount

		i.	Beginning of Interest Period

		ii.	Change to Excess Collateral Amount in connection with the Supplemental Indenture

		iii.	Increase in Excess Collateral Amount due to New Issuance

		iv.	Reductions in Required Excess Collateral Amount

		v.	Increase in Unreimbursed Investor Charge-Off

 

    	 	Exhibit B (Page 2)	 

     

    

 

		vi.	Decrease in Unreimbursed Investor Charge-Off

		vii.	Increase in Unreimbursed Reallocated Principal Collections

		viii.	Decrease in Unreimbursed Reallocated Principal Collections

		ix.	As of Payment Date

		c.	Principal Accumulation Account Balance

		i.	Beginning of Interest Period

		ii.	Controlled Deposit Amount

		iii.	Withdrawal for Principal Payment

		iv.	As of Payment Date

		d.	Collateral Amount

		i.	End of Prior Monthly Period

		ii.	Beginning of Interest Period (a.i + b.i)

		iii.	As of Payment Date

 

		III.	Trust Performance Data (Monthly Period)

	 	 	 
		a.	Gross Trust Yield (Finance Charge Collections + Recoveries / BOP Principal Receivables)

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Three-Month Average
	 	 	 

		b.	Payment Rate (Principal Collections / BOP Principal Receivables)

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Three-Month Average
	 	 	 

		c.	Gross Charge-Off Rate excluding Fraud (Default Amount for Defaulted Accounts – Fraud Amount / BOP Principal Receivables)

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Three-Month Average
	 	 	 

		d.	Gross Charge-Off Rate (Default Amount for Defaulted Accounts / BOP Principal Receivables)
	 	 	 

		e.	Net Charge-Off Rate excluding Fraud (Default Amount for Defaulted Accounts – Recoveries – Fraud Amount / BOP Principal
Receivables

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Three-Month Average

 

    	 	Exhibit B (Page 3)	 

     

    

 

		f.	Net Charge-Off Rate (Default Amount for Defaulted Accounts – Recoveries / BOP Principal Receivables)
	 	 	 

		g.	Trust excess spread percentage ((FC Coll – Charged-Off Rec – Monthly Interest +/- Net Swaps – Monthly Servicing
Fee) / BOP Principal Receivables)
	 	 	 

		h.	Default Amount for Defaulted Accounts
	 	 	 

		i.	Recovery Amount
	 	 	 

		j.	Collections

		i.	Total Trust Finance Charge Collections

		ii.	Total Trust Principal Collections

		iii.	Total Trust Collections

 

	k.     Delinquency Data	Percentage	Total Receivables

 

		i.	1-29 Days Delinquent

		ii.	30-59 Days Delinquent

		iii.	60-89 Days Delinquent

		iv.	90-119 Days Delinquent

		v.	120-149 Days Delinquent

		vi.	150-179 Days Delinquent

		vii.	180 or Greater Days Delinquent

 

		IV.	Series Performance Data

	 	 	 
		a.	Portfolio Yield (Finance Charge Collections + Recoveries – Aggregate Investor Default Amount + PAA Inv Proceeds / BOP
Collateral)

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Three-Month Average
	 	 	 

		b.	Base Rate (Noteholder Servicing Fee + Admin Fee + Monthly Interest / + Swap Payments – Swap Receipts / BOP Collateral)

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Three-Month Average
	 	 	 

		c.	Excess Spread Percentage (Portfolio Yield – Base Rate)

		i.	Current

		ii.	Prior Monthly Period

		iii.	Two Months Prior Monthly Period

		iv.	Quarterly Excess Spread Percentage

 

    	 	Exhibit B (Page 4)	 

     

    

 

		V.	Investor Information Regarding Distributions to Noteholders

	 	 	 
		a.	The total amount of the distribution to Class A Noteholders per $1000 Note Initial Principal Balance.
	 	 	 

		b.	The amount of the distribution set forth in paragraph a. above in respect of interest on the Class A Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		c.	The amount of the distribution set forth in paragraph a. above in respect of principal on the Class A Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		d.	The total amount of the distribution to Class B Noteholders per $1000 Note Initial Principal Balance.
	 	 	 

		e.	The amount of the distribution set forth in paragraph d. above in respect of interest on the Class B Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		f.	The amount of the distribution set forth in paragraph d. above in respect of principal on the Class B Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		g.	The total amount of the distribution to Class C Noteholders per $1000 Note Initial Principal Balance.
	 	 	 

		h.	The amount of the distribution set forth in paragraph g. above in respect of interest on the Class C Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		i.	The amount of the distribution set forth in paragraph g. above in respect of principal on the Class C Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		j.	The total amount of the distribution to Class D Noteholders per $1000 Note Initial Principal Balance.
	 	 	 

		k.	The amount of the distribution set forth in paragraph j. above in respect of interest on the Class D Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		l.	The amount of the distribution set forth in paragraph j. above in respect of principal on the Class D Notes, per $1000 Note
Initial Principal Balance.
	 	 	 

		VI.	Investor Information

	 	 	 
		a.	Class A Note Initial Principal Balance

		b.	Class B Note Initial Principal Balance
	 	c.	Class C Note Initial Principal Balance

		d.	Class D Note Initial Principal Balance

 

    	 	Exhibit B (Page 5)	 

     

    

 

		e.	Initial Excess Collateral Amount

		f.	Initial Collateral Amount
	 	 	 

		g.	Class A Note Principal Balance

		i.	Beginning of Interest Period

		ii.	Principal Payment

		iii.	As of Payment Date
	 	 	 

		h.	Class B Note Principal Balance

		i.	Beginning of Interest Period

		ii.	Principal Payment

		iii.	As of Payment Date
	 	 	 

		i.	Class C Note Principal Balance

		i.	Beginning of Interest Period

		ii.	Principal Payment

		iii.	As of Payment Date
	 	 	 

		j.	Class D Note Principal Balance

		i.	Beginning of Interest Period

		ii.	Principal Payment

		iii.	As of Payment Date
	 	 	 

		k.	Excess Collateral Amount

		i.	Beginning of Interest Period

		ii.	Increase in Excess Collateral Amount in connection with the Supplemental Indenture

		iii.	Reduction in Excess Collateral Amount

		iv.	As of Payment Date
	 	 	 

		l.	Collateral Amount

		i.	Beginning of Interest Period

		ii.	Increase in Excess Collateral Amount in connection with the Supplemental Indenture

		iii.	Increase/Decrease in Unreimbursed Investor Charge-Offs

		iv.	Increase/Decrease in Reallocated Principal Collections

		v.	Reduction in Excess Collateral Amount

		vi.	Principal Accumulation Account Deposit

		vii.	As of Payment Date

		viii.	Collateral Amount as a Percentage of Note Trust Principal Balance

		ix.	Amount by which Note Principal Balance exceeds Collateral Amount
	 	 	 

		m.	Required Excess Collateral Amount
	 	 	 

		VII.	Investor Charge-Offs and Reallocated Principal Collections

(Section references relate to Indenture Supplement)

	 	 	 
		a.	Beginning Unreimbursed Investor Charge-Offs

 

    	 	Exhibit B (Page 6)	 

     

    

 

		b.	Current Unreimbursed Investor Defaults

		c.	Current Unreimbursed Investor Uncovered Dilution Amount

		d.	Current Reimbursement of Investor Charge-Offs pursuant to Section 4.4(a)(viii)

		e.	Ending Unreimbursed Investor Charge-Offs

		f.	Beginning Unreimbursed Reallocated Principal Collections

		g.	Current Reallocated Principal Collections pursuant to Section 4.7

		h.	Current Reimbursement of Reallocated Principal Collections pursuant to Section 4.4(a)(viii)

		i.	Ending Unreimbursed Reallocated Principal Collections
	 	 	 

		VIII.	Investor Percentages –BOP Balance and Series Account Information

	 	 	 
		a.	Allocation Percentage Numerator – for Finance Charge Collections and Default Amounts

		b.	Allocation Percentage Numerator – for Principal Collections

		c.	Allocation Percentage Denominator

		i.	Aggregate Principal Receivables Balance as of Prior Monthly Period

		ii.	Number of Days at Balance

		iii.	Weighted Average Principal Balance

		d.	Sum of Allocation Percentage Numerators for all outstanding Series with respect to Finance Charge Collections and Default Amounts

		e.	Sum of Allocation Percentage Numerators for all outstanding Series with respect to Principal Collections

		f.	Average Daily Allocation Percentage, Finance Charge Collections and Default Amount (a./greater of c.iii. or d.)

		g.	Average Daily Allocation Percentage, Principal Collections (b./ greater of c.iii. or e.)

		h.	Series Allocation Percentage

 

		IX.	Collections and Allocations

 

	 	Trust	Series

 

		a.	Finance Charge Collections

		b.	Recoveries

		c.	Principal Collections

		d.	Default Amount

		e.	Dilution

		f.	Investor Uncovered Dilution Amount

		g.	Dilution including Fraud Amount

		h.	Available Finance Charge Collections

		i.	Investor Finance Charge Collections

		ii.	Excess Finance Charge Collections allocable to Series 2016-3

		iii.	Principal Accumulation Account Investment Proceeds

 

    	 	Exhibit B (Page 7)	 

     

    

 

		iv.	Investment earnings in the Reserve Account

		v.	Reserve Account Draw Amount

		vi.	Net Swap Receipts

		vii.	Recoveries

		i.	Available Finance Charge Collections (Sum of h.i through h.vii)

		j.	Total Collections (c. Series + i.)

		k.	Total Finance Charge Collections deposited in the Collection Account (net of any amounts distributed to Transferor and owed
to Servicer)

 

		X.	Application of Available Funds pursuant to Section 4.4(a) of the Indenture Supplement

	 	 	 
		a.	Available Finance Charge Collections

		i.	On a pari passu basis:

		a.	Payment to the Indenture Trustee, to a maximum of $25,000

		b.	Payment to the Trustee, to a maximum of $25,000

		c.	Payment to the Administrator, to a maximum of $25,000
	 	 	 

		ii.	To the Servicer:

		a.	Noteholder Servicing Fee

		b.	Noteholder Servicing Fee previously due but not paid

		c.	Total Noteholder Servicing Fee
	 	 	 

		iii.	On a pari passu basis:

		a.	Class A Monthly Interest

		b.	Class A Deficiency Amount

		c.	Class A Additional Interest

		d.	Class A Additional Interest not paid on prior Payment Date
	 	 	 

		iv.	On a pari passu basis:

		a.	Class B Monthly Interest

		b.	Class B Deficiency Amount

		c.	Class B Additional Interest

		d.	Class B Additional Interest not paid on prior Payment Date
	 	 	 

		v.	On a pari passu basis:

		a.	Class C Monthly Interest

		b.	Class C Deficiency Amount

		c.	Class C Additional Interest

		d.	Class C Additional Interest not paid on prior Payment Date
	 	 	 

		vi.	On a pari passu basis:

		a.	Class D Monthly Interest

 

    	 	Exhibit B (Page 8)	 

     

    

 

		b.	Class D Deficiency Amount

		c.	Class D Additional Interest

		d.	Class D Additional Interest not paid on prior Payment Date
	 	 	 

		vii.	To be treated as Available Principal Collections

		a.	Aggregate Investor Default Amount

		b.	Aggregate Investor Uncovered Dilution Amount
	 	 	 

		viii.	To be treated as Available Principal Collections, to the extent not previously reimbursed

		a.	Investor Charge-offs

		b.	Reallocated Principal Collections
	 	 	 

		ix.	Excess of Required Reserve Account Amount Over Available Reserve Account Amount
	 	 	 

		x.	Amounts required to be deposited to the Spread Account or Reserve Account
	 	 	 

		xi.	To be treated as Available Principal Collections: Series Allocation Percentage of Minimum Free Equity Shortfall
	 	 	 

		xii.	Unless an Early Amortization Event has occurred, amounts that have not been paid pursuant to (a)(i) above
	 	 	 

		xiii.	The balance, if any, will constitute a portion of Excess Finance Charge Collections for such Payment Date and first will be
available for allocation to other Series in Group One and, then:

		a.	Unless an Early Amortization Event has occurred, to the Transferor; or

		b.	If an Early Amortization Event has occurred, first, to pay Monthly Principal in accordance with Section 4.4(c) of the Indenture
Supplement to the extent not paid in full from Available Principal Collections (calculated without regard to amounts available
to be treated as Available Principal Collections pursuant to this clause), second, to pay on a pari passu basis any amounts owed
to such Persons listed in clause (a)(i) above that have been allocated to Series 2016-3 in accordance with Section 8.4(d) of the
Indenture and that have not been paid pursuant to clauses (a)(i) and (a)(xii) above, and, third, any amounts remaining after payment
in full of the Monthly Principal and amounts owed to such Persons listed in clause (a)(i) above shall be paid to the Issuer.
	 	 	 

		XI.	Excess Finance Charge Collections (Group One)

	 	 	 
		a.	Total Excess Finance Charge Collections in Group One

 

    	 	Exhibit B (Page 9)	 

     

    

 

		b.	Finance Charge Shortfall for Series 2016-3

		c.	Finance Charge Shortfall for all Series in Group One

		d.	Excess Finance Charges Collections Allocated to Series 2016-3
	 	 	 

		XII.	Available Principal Collections and Distributions

(Section references relate to Indenture Supplement)

	 	 	 
		a.	Investor Principal Collections

		b.	Less: Reallocated Principal Collections for the Monthly Period pursuant to Section 4.7

		c.	Plus: Shared Principal Collections allocated to this Series

		d.	Plus: Aggregate amount to be treated as Available Principal Collections pursuant to Section 4.4(a)(vii)

		e.	Plus: Aggregate amount to be treated as Available Principal Collections pursuant to Section 4.4(a)(viii)

		f.	Plus: During an Early Amortization Period, the amount of Available Finance Charge Collections used to pay principal on the
Notes pursuant to Section 4.4(a)(xiv)

		g.	Available Principal Collections (Deposited to Principal Account)

		i.	During the Revolving Period, Available Principal Collections treated as Shared Principal Collections pursuant to Section 4.4(b)

		ii.	During the Controlled Accumulation Period, Available Principal Collections deposited to the Principal Accumulation Account
pursuant to Section 4.4(c)(i), (ii)

		iii.	During the Early Amortization Period, Available Principal Collections deposited to the Distribution Account pursuant to Section
4.4(c)

		iv.	Series Shared Principal Collections available to Group One pursuant to Section 4.4(c)(iii)

		v.	Principal Distributions pursuant to Section 4.4(e) in order of priority

		a.	Principal paid to Class A Noteholders

		b.	Principal paid to Class B Noteholders

		c.	Principal paid to Class C Noteholders

		d.	Principal paid to Class D Noteholders

		vi.	Total Principal Collections Available to Share (Inclusive of Series 2016-3)

		vii.	Series Principal Shortfall

		viii.	Shared Principal Collections allocated to this Series from other Series

 

    	 	Exhibit B (Page 10)	 

     

    

 

		XIII.	Series 2016-3 Accumulation

	 	 	 
		a.	Controlled Accumulation Period Length in months (scheduled)
	 	 	 

		b.	Controlled Accumulation Amount
	 	 	 

		c.	Controlled Deposit Amount
	 	 	 

		d.	Accumulation Shortfall
	 	 	 

		e.	Principal Accumulation Account Balance

		i.	Beginning of Interest Period

		ii.	Controlled Deposit Amount

		iii.	Withdrawal for Principal Payment

		iv.	As of Payment Date
	 	 	 

		XIV.	Reserve Account Funding (Section references relate to Indenture Supplement)

	 	 	 
		a.	Reserve Account Funding Date (scheduled)
	 	 	 

		b.	Required Reserve Account Amount (0.50% of Note Principal Balance beginning on Reserve Account Funding Date)
	 	 	 

		c.	Beginning Available Reserve Account Amount
	 	 	 

		d.	Reserve Draw Amount
	 	 	 

		e.	Deposit pursuant to 4.4(a)(ix) the excess of b. over c.
	 	 	 

		f.	Withdrawal for Reserve Account Surplus paid to Transferor pursuant to Section 4.10(d)
	 	 	 

		g.	Withdrawal for Reserve Account Surplus paid to Transferor pursuant to Section 4.10(e)
	 	 	 

		h.	Ending Available Reserve Account Amount
	 	 	 

		XV.	Spread Account Funding (Section references relate to Indenture Supplement)

	 	 	 
		a.	Spread Account Percentage
	 	 	 

		b.	Required Spread Account Amount
	 	 	 

		c.	Beginning Available Spread Account Amount
	 	 	 

		d.	Withdrawal pursuant to 4.11(a) – Section 4.4(a)(vi) Shortfall
	 	 	 

		e.	Withdrawal pursuant to 4.11(b) – Class D Expected Principal Payment Date
	 	 	 

		f.	Withdrawal pursuant to 4.11(c) – Early Amortization Event
	 	 	 

		g.	Withdrawal pursuant to 4.11(d) – Event of Default
	 	 	 

		h.	Deposit pursuant to 4.4(a)(x) – Spread Account Deficiency

 

    	 	Exhibit B (Page 11)	 

     

    

 

		i.	Withdrawal pursuant to 4.11(f) – Spread Account Surplus Amount

	 	 	 
		j.	Ending Available Spread Account Amount
	 	 	 

		XVI.	Series Early Amortization Events

	 	 	 
		a.	The Free Equity Amount is less than the Minimum Free Equity Amount

	 	 	 
		 	Free Equity:

	 	 	 
		i.	Free Equity Amount

		ii.	Minimum Free Equity Amount

		iii.	Excess Free Equity Amount
	 	 	 

		b.	The Note Trust Principal Balance is less than the Required Principal Balance Note Trust Principal Balance:

		i.	Note Trust Principal Balance

		ii.	Required Principal Balance

		iii.	Excess Principal Balance
	 	 	 

		c.	The three-month Average Portfolio Yield is less than three-month average Base Rate Portfolio Yield:

		i.	Three month Average Portfolio Yield

		ii.	Three month Average Base Rate

		iii.	Three Month Average Excess Spread
	 	 	 

		d.	The Note Principal Balance is outstanding beyond the Expected Principal Payment Date

		i.	Expected Principal Payment Date

		ii.	Current Payment Date

		e.	Are there any material modifications, extensions or waivers to pool asset terms, fees, penalties or payments?

		f.	Are there any material breaches or pool of assets representations and warranties or covenants?

		g.	Are there any material changes in criteria used to originate, acquire, or select new pool assets?

		h.	Has an early amortization event occurred?

 

IN WITNESS WHEREOF,
the undersigned has duly executed this Monthly Noteholder’s Statement as of the ___ day of _____________.

 

	 	SYNCHRONY FINANCIAL, as Servicer
	 	 
	 	By:	 
	 	Name:
	 	Title:

 

    	 	Exhibit B (Page 12)	 

     

    

 

SCHEDULE I

PERFECTION REPRESENTATIONS, WARRANTIES

AND COVENANTS (WITH RESPECT TO RECEIVABLES)

 

(a)     In addition
to the representations, warranties and covenants contained in the Indenture, the Issuer hereby represents, warrants and covenants
to the Indenture Trustee as follows as of the Closing Date:

 

(1)     The Indenture
creates a valid and continuing security interest (as defined in the applicable UCC) in the Receivables in favor of the Indenture
Trustee, which security interest is prior to all other Liens, and is enforceable as such against creditors of and purchasers from
the Issuer.

 

(2)     The Receivables
constitute either “accounts” or “general intangibles” within the meaning of the applicable UCC.

 

(3)     The Issuer owns
and has good and marketable title to the Receivables free and clear of any Lien, claim or encumbrance of any Person.

 

(4)     There are no
consents or approvals required for the pledge of the Receivables to the Indenture Trustee pursuant to the Indenture.

 

(5)     The Issuer (or
the Administrator on behalf of the Issuer) has caused the filing of all appropriate financing statements in the proper filing office
in the appropriate jurisdictions under applicable law in order to perfect the security interest granted to the Indenture Trustee
under the Indenture in the Receivables.

 

(6)     Other than the
pledge of the Receivables to the Indenture Trustee pursuant to the Indenture, the Issuer has not pledged, assigned, sold, granted
a security interest in, or otherwise conveyed the Receivables. The Issuer has not authorized the filing of and is not aware of
any financing statements against the Issuer that include a description of the Receivables, except for the financing statement filed
pursuant to the Indenture.

 

(7)     Notwithstanding
any other provision of the Indenture, the representations and warranties set forth in this Schedule I shall be continuing,
and remain in full force and effect, until such time as the Series 2016-3 Notes are retired.

 

(b)     The Indenture
Trustee covenants that it shall not, without satisfying the Rating Agency Condition, waive a breach of any representation or warranty
set forth in this Schedule I.

 

(c)     The Issuer covenants
that in order to evidence the interests of the Issuer and the Indenture Trustee under the Indenture, the Issuer shall take such
action, or execute and deliver such instruments as may be necessary or advisable (including, without limitation, such actions as
are requested by the Indenture Trustee) to maintain and perfect, as a first priority interest, the Indenture Trustee’s security
interest in the Receivables.

 

    	 	Schedule I (Page 1)Exhibit

Exhibit 10.1

Kilroy Realty, L.P.

$250,000,000

$175,000,000 3.35% Senior Notes, Series A, due February 17, 2027
$75,000,000 3.45% Senior Notes, Series B, due February 17, 2029

______________

Note Purchase Agreement

______________

Dated September 14, 2016

TABLE OF CONTENTS
	
			
	SECTION
	HEADING
	PAGE

	SECTION 1.
	AUTHORIZATION OF NOTES
	1

	Section 1.1.
	Authorization of Notes
	1

	Section 1.2.
	General Partner Guaranty
	1

	Section 1.3.
	Subsidiary Guaranty
	1

	SECTION 2.
	SALE AND PURCHASE OF NOTES
	2

	SECTION 3.
	CLOSING
	2

	SECTION 4.
	CONDITIONS TO CLOSING
	2

	Section 4.1
	Representations and Warranties
	2

	Section 4.2.
	Performance; No Default
	3

	Section. 4.3.
	Compliance Certificates
	3

	Section 4.4.
	Opinions of Counsel
	3

	Section 4.5.
	Purchase Permitted by Applicable Law, Etc
	4

	Section 4.6.
	Sale of Other Notes
	4

	Section 4.7.
	Payment of Special Counsel Fees
	4

	Section 4.8.
	Private Placement Number
	4

	Section 4.9.
	Changes in Corporate Structure
	4

	Section 4.10.
	Funding Instructions
	4

	Section 4.11.
	General Partner Guaranty
	4

	Section 4.12.
	Proceedings and Documents
	5

	SECTION 5.
	REPRESENTATIONS AND WARRANTIES OF THE COMPANY
	5

	Section 5.1.
	Organization; Power and Authority
	5

	Section 5.2.
	Authorization, Etc
	5

	Section 5.3.
	Disclosure
	5

	Section 5.4.
	Organization and Ownership of Shares of Subsidiaries; Affiliates
	6

	Section 5.5.
	Financial Statements; Material Liabilities
	6

	Section 5.6.
	Compliance with Laws, Other Instruments, Etc
	7

	Section 5.7.
	Governmental Authorizations, Etc
	7

	Section 5.8.
	Litigation; Observance of Agreements, Statutes and Orders
	7

	Section 5.9.
	Taxes
	7

	Section 5.10.
	Title to Property; Leases
	8

	Section 5.11.
	Licenses, Permits, Etc
	8

	Section 5.12.
	Compliance with Employee Benefit Plans
	8

	Section 5.13.
	Private Offering by the Company
	9

	Section 5.14.
	Use of Proceeds; Margin Regulations
	10

	Section 5.15.
	Existing Debt; Future Liens
	10

 i

	
			
	Section 5.16.
	Foreign Assets Control Regulations, Etc
	11

	Section 5.17.
	Status under Certain Statutes
	11

	Section 5.18.
	Environmental Matters
	11

	Section 5.19.
	REIT Status
	12

	SECTION 6.
	REPRESENTATIONS OF THE PURCHASERS
	12

	Section 6.1.
	Purchase for Investment
	12

	Section 6.2.
	Source of Funds
	13

	SECTION 7.
	INFORMATION AS TO COMPANY
	14

	Section 7.1.
	Financial and Business Information
	14

	Section 7.2.
	Officer’s Certificate
	17

	Section 7.3.
	Visitation
	18

	Section 7.4. 
	Electronic Delivery
	19

	SECTION 8.
	PAYMENT AND PREPAYMENT OF THE NOTES
	20

	Section 8.1.
	Maturity
	20

	Section 8.2.
	Optional Prepayments with Make‐Whole Amount
	20

	Section 8.3.
	Allocation of Partial Prepayments
	21

	Section 8.4.
	Maturity; Surrender, Etc.
	21

	Section 8.5.
	Purchase of Notes
	21

	Section 8.6.
	Make‐Whole Amount
	22

	Section 8.7.
	Change of Control
	23

	Section 8.8.
	Payments Due on Non‐Business Days
	24

	SECTION 9.
	AFFIRMATIVE COVENANTS
	24

	Section 9.1.
	Compliance with Laws
	24

	Section 9.2.
	Insurance
	25

	Section 9.3.
	Maintenance of Properties
	25

	Section 9.4.
	Payment of Taxes and Claims
	25

	Section 9.5.
	Corporate Existence, Etc
	25

	Section 9.6.
	Books and Records
	25

	Section 9.7.
	Subsidiary Guarantors
	26

	Section 9.8.
	General Partner Status
	27

	Section 9.9.
	Priority of Obligations
	27

	SECTION 10. 
	NAGATIVE COVENANTS
	27

	Section 10.1.
	Transactions with Affiliates
	27

	Section 10.2.
	Merger, Consolidation, Etc
	28

	Section 10.3.
	Line of Business
	29

	Section 10.4.
	Economic Sanctions, Etc
	29

	Section 10.5.
	Financial Covenants
	29

	Section 10.6.
	Most Favored Lender Status
	31

 ii

	
			
	SECTION 11.
	EVENTS OF DEFAULT
	32

	SECTION 12.
	REMEDIES ON DEFAULT, ETC
	36

	Section 12.1.
	Acceleration
	36

	Section 12.2.
	Other Remedies
	36

	Section 12.3.
	Rescission
	37

	Section 12.4.
	No Waivers or Election of Remedies, Expenses, Etc
	37

	SECTION 13.
	REGISTRATION; EXCHANGE; SUBSTITUTION OF NOTES
	37

	Section 13.1.
	Registration of Notes
	37

	Section 13.2.
	Transfer and Exchange of Notes
	38

	Section 13.3.
	Replacement of Notes
	38

	SECTION 14.
	PAYMENTS ON NOTES
	39

	Section 14.1.
	Place of Payment
	39

	Section 14.2.
	Payment by Wire Transfer
	39

	Section 14.3.
	FATCA Information
	39

	SECTION 15.
	EXPENSES, ETC
	40

	Section 15.1.
	Transaction Expenses
	40

	Section 15.2.
	Certain Taxes
	40

	Section 15.3.
	Survival
	41

	SECTION 16.
	SURVIVAL OF REPRESENTATIONS AND WARRANTIES; ENTIRE AGREEMENT
	41

	SECTION 17.
	AMENDMENT AND WAIVER
	41

	Section 17.1.
	Requirements
	41

	Section 17.2.
	Solicitation of Holders of Notes
	42

	Section 17.3.
	Binding Effect, Etc
	42

	Section 17.4.
	Notes Held by Company, Etc
	42

	SECTION 18.
	NOTICES
	43

	SECTION 19.
	REPRODUCTION OF DOCUMENTS
	43

	SECTION 20.
	CONFIDENTIAL INFORMATION
	44

	SECTION 21.
	SUBSTITUTION OF PURCHASER
	45

	SECTION 22.
	MISCELLANEOUS
	45

	Section 22.1.
	Successors and Assigns
	45

	Section 22.2.
	Accounting Terms
	45

 iii

	
			
	Section 22.3.
	Severability
	46

	Section 22.4.
	Construction, Etc
	46

	Section 22.5.
	Counterparts
	47

	Section 22.6.
	Governing Law
	47

	Section 22.7
	Jurisdiction and Process; Waiver of Jury Trial
	47

	Signature
	49

 iv

	
			
	Schedule A
	-
	Defined Terms

	Schedule 1‐A
	-
	Form of 3.35% Senior Notes, Series A, due February 17, 2027

	Schedule 1‐B
	-
	Form of 3.45% Senior Notes, Series B, due February 17, 2029

	Schedule 1.2
	-
	Form of General Partner Guaranty

	Schedule 4.4(a)
  (x) and (y)
	-
	Form of Opinion of Special Counsel for the Company

	Schedule 4.4(b)
	-
	Form of Opinion of Special Counsel for the Purchasers

	Schedule 5.3
	-
	Disclosure Materials

	Schedule 5.4
	-
	Subsidiaries of the Company and Ownership of Subsidiary Stock

	Schedule 5.5
	-
	Financial Statements

	Schedule 5.15
	-
	Existing Debt

	Schedule 10.5(a)
	-
	Unencumbered Asset Pool Properties (Fee Interests)

	Schedule 10.5(b)
	-
	Unencumbered Asset Pool Properties (Leasehold Interests)

	Purchaser Schedule
	-
	Information Relating to Purchasers

 v

Kilroy Realty, L.P.
12200 West Olympic Boulevard, Suite 200
Los Angeles, California  90064

$175,000,000 3.35% Senior Notes, Series A, due February 17, 2027
$75,000,000 3.45% Senior Notes, Series B, due February 17, 2029

September 14, 2016

To Each of the Purchasers Listed in
the Purchaser Schedule Hereto:
Ladies and Gentlemen:
Kilroy Realty, L.P., a Delaware limited partnership (the “Company”), agrees with each of the Purchasers as follows:
		
	Section 1.
	Authorization of Notes.

Section 1.1.    Authorization of Notes.  The Company will authorize the issue and sale of (a) $175,000,000 aggregate principal amount of its 3.35% Senior Notes, Series A, due February 17, 2027 (the “Series A Notes”), and (b) $75,000,000 aggregate principal amount of its 3.45% Senior Notes, Series B, due February 17, 2029 (the “Series B Notes”; the Series A Notes and the Series B Notes are hereinafter collectively referred to as the “Notes”).  The Notes shall be substantially in the form set out in Schedule 1‐A and Schedule 1‐B, respectively.  Certain capitalized and other terms used in this Agreement are defined in Schedule A and, for purposes of this Agreement, the rules of construction set forth in Section 22.4 shall govern.
Section 1.2.    General Partner Guaranty.  The payment by the Company of all amounts due with respect to the Notes and the performance by the Company of its obligations under this Agreement will be absolutely and unconditionally guaranteed by the General Partner pursuant to the guaranty agreement substantially in the form of Schedule 1.2 attached hereto and made a part hereof (as the same may be amended, modified, extended or renewed, the “General Partner Guaranty”).
Section 1.3.    Subsidiary Guaranty.  The payment by the Company of all amounts due with respect to the Notes and the performance by the Company of its obligations under this Agreement may be absolutely and unconditionally guaranteed by certain of its Subsidiaries pursuant to, and to the extent required by, Section 9.7.

		
	Section 2.
	Sale and Purchase of Notes.

Subject to the terms and conditions of this Agreement, the Company will issue and sell to each Purchaser and each Purchaser will purchase from the Company, at the Closing provided for in Section 3, Notes in the principal amount and in the series specified opposite such Purchaser’s name in the Purchaser Schedule at the purchase price of 100% of the principal amount thereof.  The Purchasers’ obligations hereunder are several and not joint obligations and no Purchaser shall have any liability to any Person for the performance or non‐performance of any obligation by any other Purchaser hereunder.
		
	Section 3.
	Closing.

The execution and delivery of the Note Purchase Agreement shall occur at the offices of Chapman and Cutler LLP, 111 W. Monroe Street, Chicago, Illinois 60603 on September 14, 2016 (the “Execution Date”).
The sale and purchase of the Notes to be purchased by each Purchaser shall occur at the offices of Chapman and Cutler, LLP, 111 W. Monroe, Chicago, Illinois 60603, at 10:00 a.m., Chicago time, at a closing (the “Closing”) on February 17, 2017 or on such other Business Day thereafter on or prior to February 21, 2017 as may be agreed upon by the Company and the Purchasers.  At the Closing the Company will deliver to each Purchaser the Notes of the series to be purchased by such Purchaser in the form of a single Note (or such greater number of Notes in denominations of at least $100,000 as such Purchaser may request) dated the date of the Closing and registered in such Purchaser’s name (or in the name of its nominee), against delivery by such Purchaser to the Company or its order of immediately available funds in the amount of the purchase price therefor by wire transfer of immediately available funds for the account of the Company to account number 93400‐00622 at Union Bank, 445 S. Figueroa Street, Los Angeles, CA, 90071‐1602, ABA# 122 000 496, Account Name: Kilroy Realty LP.  If at the Closing the Company shall fail to tender such Notes to any Purchaser as provided above in this Section 3, or any of the conditions specified in Section 4 shall not have been fulfilled to such Purchaser’s reasonable satisfaction, such Purchaser shall, at its election, be relieved of all further obligations under this Agreement, without thereby waiving any rights such Purchaser may have by reason of such failure by the Company to tender such Notes or any of the conditions specified in Section 4 not having been fulfilled to such Purchaser’s reasonable satisfaction.
		
	Section 4.
	Conditions to Closing.

Each Purchaser’s obligation to purchase and pay for the Notes to be sold to such Purchaser at the Closing is subject to the fulfillment to such Purchaser’s reasonable satisfaction, prior to or at the Closing, of the following conditions:
Section 4.1.    Representations and Warranties.  (a) The representations and warranties of the Company in this Agreement shall be correct on the Execution Date and in all material respects at the Closing.

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(b)    The representations and warranties of the General Partner in the General Partner Guaranty shall be correct in all material respects at the Closing.
Section 4.2.    Performance; No Default.  (a) The Company shall have performed and complied with all agreements and conditions contained in this Agreement required to be performed or complied with by it prior to or at the Closing, including from the Execution Date to the Closing.  Immediately before and after giving effect to the issue and sale of the Notes (and the application of the proceeds thereof as contemplated by Section 5.14), no Default or Event of Default shall have occurred and be continuing and no Change of Control shall have occurred.  Neither the Company nor any Subsidiary shall have entered into any transaction since the date of the Investor Presentation that would have been prohibited by Section 10 had such Section applied since such date.
(b)    The General Partner shall have performed and complied with all agreements and conditions contained in the General Partner Guaranty required to be performed or complied with by it prior to or at the Closing.
Section 4.3.    Compliance Certificates.
(a)    Officer’s Certificate of the Company.  The Company shall have delivered to such Purchaser an Officer’s Certificate, dated the date of the Closing, certifying that the conditions specified in Sections 4.1(a), 4.2(a) and 4.9 have been fulfilled.
(b)    Officer’s Certificate of the General Partner.  The General Partner shall have delivered to such Purchaser an Officer’s Certificate, dated the date of the Closing, certifying that the conditions specified in Sections 4.1(b), 4.2(b) and 4.9 have been fulfilled.
(c)    Secretary’s Certificate of the Company.  The Company shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of the Closing, certifying as to (i) the resolutions attached thereto and other partnership proceedings relating to the authorization, execution and delivery of the Notes and this Agreement and (ii) the Company’s organizational documents as then in effect.
(d)    Secretary’s Certificate of the General Partner.  The General Partner shall have delivered to such Purchaser a certificate of its Secretary or Assistant Secretary, dated the date of the Closing, certifying as to (i) the resolutions attached thereto and other corporate proceedings relating to the authorization, execution and delivery of the General Partner Guaranty and (ii) the General Partner’s organizational documents as then in effect.
Section 4.4.    Opinions of Counsel.  Such Purchaser shall have received opinions in form and substance satisfactory to such Purchaser, dated the date of the Closing (a) from (x) Latham & Watkins LLP, special counsel for the Company and the General Partner, covering the matters set forth in Schedule 4.4(a)(x) and (y) Ballard Spahr LLP, special Maryland counsel for the General Partner, covering the matters set forth in Schedule 4.4(a)(y) and covering such other customary matters incident to the transactions contemplated hereby as such Purchaser or its counsel may reasonably request (and the Company hereby instructs its counsel to deliver such 

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opinion to the Purchasers) and (b) from Chapman and Cutler LLP, the Purchasers’ special counsel in connection with such transactions, substantially in the form set forth in Schedule 4.4(b) and covering such other customary matters incident to such transactions as such Purchaser may reasonably request.
Section 4.5.    Purchase Permitted By Applicable Law, Etc.  On the date of the Closing such Purchaser’s purchase of Notes shall (a) be permitted by the laws and regulations of each jurisdiction to which such Purchaser is subject, without recourse to provisions (such as section 1405(a)(8) of the New York Insurance Law) permitting limited investments by insurance companies without restriction as to the character of the particular investment, (b) not violate any applicable law or regulation (including Regulation T, U or X of the Board of Governors of the Federal Reserve System) and (c) not subject such Purchaser to any tax, penalty or liability under or pursuant to any applicable law or regulation, which law or regulation was not in effect on the date hereof.  If requested by such Purchaser at least ten Business Days prior to the Closing, such Purchaser shall have received an Officer’s Certificate certifying as to such matters of fact as such Purchaser may reasonably specify to enable such Purchaser to determine whether such purchase is so permitted.
Section 4.6.    Sale of Other Notes.  Contemporaneously with the Closing the Company shall sell to each other Purchaser and each other Purchaser shall purchase the Notes to be purchased by it at the Closing as specified in the Purchaser Schedule.
Section 4.7.    Payment of Special Counsel Fees.  Without limiting Section 15.1, the Company shall have paid on or before (i) the Execution Date and (ii) the Closing the reasonable and documented fees, charges and disbursements of the Purchasers’ special counsel referred to in Section 4.4 to the extent reflected in a statement of such counsel rendered to the Company at least one Business Day prior to Execution Date or the Closing, as applicable.
Section 4.8.    Private Placement Number.  A Private Placement Number issued by Standard & Poor’s CUSIP Service Bureau (in cooperation with the SVO) shall have been obtained for each series of the Notes.
Section 4.9.    Changes in Corporate Structure.  Each of the Company and the General Partner shall not have changed its respective jurisdiction of incorporation or organization, as applicable, or been a party to any merger or consolidation or succeeded to all or any substantial part of the liabilities of any other entity, at any time following the date of the most recent financial statements referred to in Schedule 5.5.  
Section 4.10.    Funding Instructions.  At least three Business Days prior to the date of the Closing, each Purchaser shall have received written instructions signed by a Responsible Officer on letterhead of the Company confirming the information specified in Section 3 including (i) the name and address of the transferee bank, (ii) such transferee bank’s ABA number and (iii) the account name and number into which the purchase price for the Notes is to be deposited.
Section 4.11.    General Partner Guaranty.  The General Partner Guaranty shall have been executed and delivered by the General Partner and shall be in full force and effect.

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Section 4.12.    Proceedings and Documents.  All corporate and other proceedings in connection with the transactions contemplated by this Agreement and all documents and instruments incident to such transactions shall be reasonably satisfactory to such Purchaser and its special counsel, and such Purchaser and its special counsel shall have received all such counterpart originals or certified or other copies of such documents as such Purchaser or such special counsel may reasonably request.
		
	Section 5.
	Representations and Warranties of the Company.

The Company represents and warrants to each Purchaser on the Execution Date and on the date of the Closing that:
Section 5.1.    Organization; Power and Authority.  The Company is a limited partnership duly organized, validly existing and in good standing under the laws of its jurisdiction of organization, and is duly qualified as a foreign limited partnership and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  The Company has the limited partnership power and authority (a) to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact and (b) to execute and deliver this Agreement and the Notes and to perform the provisions hereof and thereof, except in each case referred to in clause (a), to the extent that failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 5.2.    Authorization, Etc.  This Agreement and the Notes have been duly authorized by all necessary limited partnership action on the part of the Company, and this Agreement constitutes, and upon execution and delivery thereof each Note will constitute, a legal, valid and binding obligation of the Company enforceable against the Company in accordance with its terms, except as such enforceability may be limited by (i) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (ii) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
Section 5.3.    Disclosure.  The Company, through its agent, Barclays Capital Inc., has delivered to each Purchaser a copy of a Private Placement Investor Presentation, dated August 9, 2016 (the “Investor Presentation”), relating to the transactions contemplated hereby.  The Investor Presentation fairly describes, in all material respects, the general nature of the business and principal properties of the Company and its Subsidiaries.  This Agreement, the Investor Presentation, the financial statements listed in Schedule 5.5 and the documents, certificates or other writings delivered to the Purchasers by or on behalf of the Company prior to August 17, 2016 in connection with the transactions contemplated hereby and identified in Schedule 5.3 (this Agreement, the Investor Presentation and such documents, certificates or other writings and such financial statements delivered to each Purchaser being referred to, collectively, as the “Disclosure Documents”), taken as a whole, do not contain any untrue statement of a material fact or omit to state any material fact necessary to make the statements therein not misleading in 

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light of the circumstances under which they were made; provided that, with respect to projections, estimates and other forward looking information, the Company represents only that such information was prepared in good faith based upon assumptions believed to be reasonable at the time.  Except as disclosed in the Disclosure Documents, since December 31, 2015, there has been no change in the financial condition, operations, business or properties of the Company or any Subsidiary except changes that could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  There is no fact known to the Company that could reasonably be expected to have a Material Adverse Effect that has not been set forth herein or in the Disclosure Documents.
Section 5.4.    Organization and Ownership of Shares of Subsidiaries.  (a) Schedule 5.4 contains (except as noted therein) as of the Execution Date complete and correct lists of (i) the Company’s Subsidiaries, showing, as to each Subsidiary, the name thereof, the jurisdiction of its organization, the percentage of shares of each class of its capital stock or similar equity interests outstanding owned by the Company and each other Subsidiary and whether such Subsidiary is a Subsidiary Guarantor, and (ii) the Company’s directors and senior officers.
(b)    All of the outstanding shares of capital stock or similar equity interests of each Subsidiary shown in Schedule 5.4 as being owned by the Company and its Subsidiaries have been validly issued, are fully paid and non‐assessable and are owned by the Company or another Subsidiary free and clear of any Lien that is prohibited by this Agreement, other than any changes since the Execution Date which would not be prohibited by, or cause a default under, Section 10 had such Section applied since such date and which are disclosed on an updated Schedule 5.4 delivered to the Purchasers at least five Business Days prior to Closing.
(c)    Each Subsidiary is a corporation or other legal entity duly organized, validly existing and, where applicable, in good standing under the laws of its jurisdiction of organization, and is duly qualified as a foreign corporation or other legal entity and, where applicable, is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  Each such Subsidiary has the corporate or other power and authority to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact, except to the extent that the failure to do so could not reasonably be expected to have a Material Adverse Effect.
(d)    As of the Execution Date, no Subsidiary is subject to any legal, regulatory, contractual or other restriction (other than the agreements listed on Schedule 5.4 and customary limitations imposed by corporate law or similar statutes and agreements governing Non‐Recourse Debt) restricting the ability of such Subsidiary to pay dividends out of profits or make any other similar distributions of profits to the Company or any of its Subsidiaries that owns outstanding shares of capital stock or similar equity interests of such Subsidiary.
Section 5.5.    Financial Statements; Material Liabilities.  The Company has delivered to each Purchaser copies of the financial statements of the General Partner, the Company and its consolidated Subsidiaries.  All of such financial statements (including in each case the related 

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schedules and notes) fairly present in all material respects the consolidated financial position of the General Partner, the Company and its consolidated Subsidiaries as of the respective dates specified in such Schedule and the consolidated results of their operations and cash flows for the respective periods so specified and have been prepared in accordance with GAAP consistently applied throughout the periods involved except as set forth in the notes thereto (subject, in the case of any interim financial statements, to normal year‐end adjustments and the absence of footnotes).  The General Partner, the Company and its Subsidiaries do not have any Material liabilities that are not disclosed in the Disclosure Documents.
Section 5.6.    Compliance with Laws, Other Instruments, Etc.  The execution, delivery and performance by the Company of this Agreement and the Notes will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of any property of the Company or any Subsidiary under, (x) any indenture, mortgage, deed of trust, loan, purchase or credit agreement or lease in any material respect, (y) corporate charter, regulations or by‐laws or shareholders agreement or (z) any other agreement or instrument to which the Company or any Subsidiary is bound or by which the Company or any Subsidiary or any of their respective properties may be bound or affected in any material respect, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority applicable to the Company or any Subsidiary in any material respect or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Company or any Subsidiary in any material respect.
Section 5.7.    Governmental Authorizations, Etc.  No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by the Company of this Agreement or the Notes, except for consents, approvals, authorizations, filings and declarations which have been duly obtained, given or made and are in full force and effect.
Section 5.8.    Litigation; Observance of Agreements, Statutes and Orders.  (a) There are no actions, suits, investigations or proceedings pending or, to the best knowledge of the Company, threatened in writing against or affecting the Company or any Subsidiary or any property of the Company or any Subsidiary in any court or before any arbitrator of any kind or before or by any Governmental Authority that could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
(b)    Neither the Company nor any Subsidiary is (i) in default under any agreement or instrument to which it is a party or by which it is bound, (ii) in violation of any order, judgment, decree or ruling of any court, any arbitrator of any kind or any Governmental Authority or (iii) in violation of any applicable law, ordinance, rule or regulation of any Governmental Authority (including Environmental Laws, the USA PATRIOT Act or any of the other laws and regulations that are referred to in Section 5.16), which default or violation could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 5.9.    Taxes.  The Company and its Subsidiaries have filed all material tax returns that are required to have been filed in any jurisdiction, and have paid all taxes shown to be due 

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and payable on such returns and all other taxes and assessments levied upon them or their properties, assets, income or franchises, to the extent such taxes and assessments have become due and payable and before they have become delinquent, except for any taxes and assessments (i) the amount of which, individually or in the aggregate, is not Material or (ii) the amount, applicability or validity of which is currently being contested in good faith by appropriate proceedings and with respect to which the Company or a Subsidiary, as the case may be, has established adequate reserves in accordance with GAAP.  The Company knows of no basis for any other tax or assessment that could, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  The charges, accruals and reserves on the books of the Company and its Subsidiaries in respect of U.S. federal, state or other taxes for all fiscal periods are adequate.  The U.S. federal income tax liabilities of the Company and its Subsidiaries have been finally determined (whether by reason of completed audits or the statute of limitations having run) for all fiscal years up to and including the fiscal year ended December 31, 2011.
Section 5.10.    Title to Property; Leases.  The Company and its Subsidiaries have good and marketable title to, or valid leasehold interests in, their respective real properties necessary or used in the ordinary conduct of their business, except for such defects in title as could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, and in each case free and clear of Liens prohibited by this Agreement.
Section 5.11.    Licenses, Permits, Etc.  (a) The Company and its Subsidiaries own or possess all licenses, permits, franchises, authorizations, patents, copyrights, proprietary software, service marks, trademarks and trade names, or rights thereto, that individually or in the aggregate are Material, without known conflict with the rights of others.
(b)    To the best knowledge of the Company, no product or service of the Company or any of its Subsidiaries infringes in any material respect on any license, permit, franchise, authorization, patent, copyright, proprietary software, service mark, trademark, trade name or other right owned by any other Person.
(c)    To the best knowledge of the Company, there is no Material violation by any Person of any right of the Company or any of its Subsidiaries with respect to any license, permit, franchise, authorization, patent, copyright, proprietary software, service mark, trademark, trade name or other right owned or used by the Company or any of its Subsidiaries.
Section 5.12.    Compliance with ERISA.  (a) The Company and each ERISA Affiliate have operated and administered each Plan for which the Company may have any liability in compliance with all applicable laws except for such instances of noncompliance as have not resulted in and could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.  Except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, (i) neither the Company nor any ERISA Affiliate has incurred any liability pursuant to Title IV of ERISA or the penalty or excise tax provisions of the Code relating to employee benefit plans (as defined in section 3 of ERISA), and (ii) no event, transaction or condition has occurred or exists that could, individually or in the aggregate, reasonably be expected to result in the incurrence of any such liability by the Company or any ERISA Affiliate, or in the imposition of any Lien on any of the rights, properties or assets of the 

8

Company or any ERISA Affiliate, in either case pursuant to Title IV of ERISA or to section 430(k) of the Code or pursuant to any such penalty or excise tax provisions under the Code or section 4068 of ERISA or by the granting of a security interest in connection with the amendment of a Plan.
(b)    Except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the present value of the aggregate benefit liabilities under each of the Pension Plans (other than Multiemployer Plans), determined as of the end of such Pension Plan’s most recently ended plan year on the basis of the actuarial assumptions specified for funding purposes in such Pension Plan’s most recent actuarial valuation report, did not exceed the aggregate current value of the assets of such Pension Plan allocable to such benefit liabilities. The term “benefit liabilities” has the meaning specified in section 4001 of ERISA and the terms “current value” and “present value” have the meaning specified in section 3 of ERISA.
(c)    Except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Company and its ERISA Affiliates have not incurred and are not reasonably expected to incur withdrawal liabilities under section 4201 or 4204 of ERISA in respect of Multiemployer Plans.
(d)    Except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries do not have any postretirement benefit obligation (determined in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 715‐60, without regard to liabilities attributable to continuation coverage mandated by section 4980B of the Code).
(e)    The execution and delivery of this Agreement and the issuance and sale of the Notes hereunder will not involve any transaction that is subject to the prohibitions of section 406 of ERISA or in connection with which a tax could be imposed pursuant to section 4975(c)(1)(A)‐(D) of the Code.  The representation by the Company to each Purchaser in the first sentence of this Section 5.12(e) is made in reliance upon and subject to the accuracy of each such Purchaser’s representations in Section 6.2 as to the sources of the funds to be used to pay the purchase price of the Notes to be purchased by each such Purchaser.
(f)    Except as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect, the Company and its Subsidiaries do not have any obligations with respect to any Non‐U.S. Plans.
Section 5.13.    Private Offering by the Company.  Neither the Company nor anyone acting on its behalf has offered the Notes or any similar Securities for sale to, or solicited any offer to buy the Notes or any similar Securities from, or otherwise approached or negotiated in respect thereof with, any Person other than not more than 60 Institutional Investors (including the Purchasers), each of which has been offered the Notes at a private sale for investment.  Neither the Company nor anyone acting on its behalf has taken, or will take, any action that would subject the issuance or sale of the Notes to the registration requirements of section 5 of the 

9

Securities Act or to the registration requirements of any Securities or blue sky laws of any applicable jurisdiction.
Section 5.14.    Use of Proceeds; Margin Regulations.  The Company will apply the proceeds of the sale of the Notes hereunder to refinance existing Debt, to redeem preferred equity and for general corporate purposes, including funding acquisitions and development.  No part of the proceeds from the sale of the Notes hereunder will be used, directly or indirectly, for the purpose of buying or carrying any margin stock within the meaning of Regulation U of the Board of Governors of the Federal Reserve System (12 CFR 221), or for the purpose of buying or carrying or trading in any Securities under such circumstances as to involve the Company in a violation of Regulation X of said Board (12 CFR 224) or to involve any broker or dealer in a violation of Regulation T of said Board (12 CFR 220).  Margin stock does not constitute more than 5% of the value of the consolidated assets of the Company and its Subsidiaries and the Company does not have any present intention that margin stock will constitute more than 5% of the value of such assets.  As used in this Section, the terms “margin stock” and “purpose of buying or carrying” shall have the meanings assigned to them in said Regulation U.
Section 5.15.    Existing Debt; Future Liens.  (a) Except as described therein, Schedule 5.15 sets forth a complete and correct list of all outstanding Debt of the Company and its Subsidiaries as of June 30, 2016 (including descriptions of the obligors and obligees (or the agent, trustee or other entity acting in a similar capacity on behalf of the obligees), principal amounts outstanding, any collateral therefor and any Contingent Obligation in respect thereof), since which date there has been no Material change in the amounts, interest rates, sinking funds, installment payments or maturities of the Debt of the Company or its Subsidiaries other than changes that would not be prohibited by, or cause a default under, Section 10 had such Section applied since such date and that are disclosed on an updated Schedule 5.15 delivered to the Purchasers at least five Business Days prior to Closing.  Neither the Company nor any Subsidiary is in default and no waiver of default is currently in effect, in the payment of any principal or interest on any Debt of the Company or such Subsidiary and no event or condition exists with respect to any Debt of the Company or any Subsidiary that would permit (or that with notice or the lapse of time, or both, would permit) one or more Persons to cause such Debt to become due and payable before its stated maturity or before its regularly scheduled dates of payment.
(b)    Except as disclosed in Schedule 5.15, neither the Company nor any Subsidiary has agreed or consented to cause or permit any of its property, whether now owned or hereafter acquired, to be subject to a Lien that secures Debt or to cause or permit in the future (upon the happening of a contingency or otherwise) any of its property, whether now owned or hereafter acquired, to be subject to a Lien that secures Debt, other than any Liens incurred since the Execution Date which would not be prohibited by, or cause a default under, Section 10 had such Section applied since such date and which are disclosed on an updated Schedule 5.15 delivered to the Purchasers at least five Business Days prior to Closing.
(c)    Neither the Company nor any Subsidiary is a party to, or otherwise subject to any provision contained in, any instrument evidencing Debt of the Company or such Subsidiary, any agreement relating thereto or any other agreement (including its charter or any other 

10

organizational document) which limits the amount of, or otherwise imposes restrictions on the incurring of, Debt of the Company, except (i) as disclosed in Schedule 5.15 or (ii) with respect to agreements entered into after the Execution Date (1) with terms no more restrictive on the Company or any Subsidiary than this Agreement and (2) disclosed on an updated Schedule 5.15 delivered to the Purchasers at least five Business Days prior to Closing.
Section 5.16.    Foreign Assets Control Regulations, Etc.  (a) Neither the Company nor any Controlled Entity (i) is a Blocked Person, (ii) has been notified that its name appears or may in the future appear on a State Sanctions List or (iii) is a target of sanctions that have been imposed by the United Nations or the European Union.
(b)    Neither the Company nor any Controlled Entity (i) has violated, been found in violation of, or been charged or convicted under, any applicable U.S. Economic Sanctions Laws, Anti‐Money Laundering Laws or Anti‐Corruption Laws or (ii) to the Company’s knowledge, is under investigation by any Governmental Authority for possible violation of any U.S. Economic Sanctions Laws, Anti‐Money Laundering Laws or Anti‐Corruption Laws.
(c)    No part of the proceeds from the sale of the Notes hereunder:
(i)    constitutes or will constitute funds obtained on behalf of any Blocked Person or will otherwise be used by the Company or any Controlled Entity, directly or indirectly, (A) in connection with any investment in, or any transactions or dealings with, any Blocked Person or (B) for any purpose that would cause any Purchaser to be in violation of any U.S. Economic Sanctions Laws or (C) otherwise in violation of any U.S. Economic Sanctions Laws;
(ii)    will be used, directly or indirectly, in violation of, or cause any Purchaser to be in violation of, any applicable Anti‐Money Laundering Laws; or
(iii)    will be used, directly or indirectly, for the purpose of making any improper payments, including bribes, to any Governmental Official or commercial counterparty in order to obtain, retain or direct business or obtain any improper advantage, in each case which would be in violation of, or cause any Purchaser to be in violation of, any applicable Anti‐Corruption Laws.
(d)    The Company has established procedures and controls which it reasonably believes are adequate (and otherwise comply with applicable law) to ensure that the Company and each Controlled Entity is and will continue to be in compliance with all applicable U.S. Economic Sanctions Laws, Anti‐Money Laundering Laws and Anti‐Corruption Laws.
Section 5.17.    Status under Certain Statutes.  Neither the Company nor any Subsidiary is subject to regulation under the Investment Company Act of 1940, the Public Utility Holding Company Act of 2005, the ICC Termination Act of 1995, or the Federal Power Act.
Section 5.18.    Environmental Matters.  (a) Neither the Company nor any Subsidiary has knowledge of any claim or has received any written notice of any claim and no proceeding has 

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been instituted asserting any claim against the Company or any of its Subsidiaries or any of their respective real properties or other assets now or formerly owned, leased or operated by any of them, alleging any damage to the environment or violation of any Environmental Laws, except, in each case, such as could not reasonably be expected to result in a Material Adverse Effect. 
(b)    Neither the Company nor any Subsidiary has knowledge of any facts which would give rise to any claim, public or private, of violation of Environmental Laws or damage to the environment emanating from, occurring on or in any way related to real properties now or formerly owned, leased or operated by any of them or to other assets or their use, except, in each case, such as could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(c)    Neither the Company nor any Subsidiary has stored any Hazardous Materials on real properties now or formerly owned, leased or operated by any of them in a manner which is contrary to any Environmental Law that could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(d)    Neither the Company nor any Subsidiary has disposed of any Hazardous Materials in a manner which is contrary to any Environmental Law that could, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
(e)    All buildings on all real properties now owned, leased or operated by the Company or any Subsidiary are in compliance with applicable Environmental Laws, except where failure to comply could not, individually or in the aggregate, reasonably be expected to result in a Material Adverse Effect.
Section 5.19.    REIT Status.  The General Partner is qualified, and the General Partner intends to continue to qualify, as a REIT.
Section 6.    Representations of the Purchasers.
Section 6.1.    Purchase for Investment.  Each Purchaser severally represents (a) that it is purchasing the Notes for its own account or for one or more separate accounts maintained by such Purchaser or for the account of one or more pension or trust funds and not with a view to the distribution thereof, provided that the disposition of such Purchaser’s or their property shall at all times be within such Purchaser’s or their control and (b) that it is an institutional accredited investor within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act.  Each Purchaser understands that the Notes have not been registered under the Securities Act and may be resold only if registered pursuant to the provisions of the Securities Act or if an exemption from registration is available, except under circumstances where neither such registration nor such an exemption is required by law, and that the Company is not required to register the Notes.

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Section 6.2.    Source of Funds.  Each Purchaser severally represents that at least one of the following statements is an accurate representation as to each source of funds (a “Source”) to be used by such Purchaser to pay the purchase price of the Notes to be purchased by such Purchaser hereunder:
(a)    the Source is an “insurance company general account” (as the term is defined in the United States Department of Labor’s Prohibited Transaction Exemption (“PTE”) 95‐60) in respect of which the reserves and liabilities (as defined by the annual statement for life insurance companies approved by the NAIC (the “NAIC Annual Statement”)) for the general account contract(s) held by or on behalf of any employee benefit plan together with the amount of the reserves and liabilities for the general account contract(s) held by or on behalf of any other employee benefit plans maintained by the same employer (or affiliate thereof as defined in PTE 95‐60) or by the same employee organization in the general account do not exceed 10% of the total reserves and liabilities of the general account (exclusive of separate account liabilities) plus surplus as set forth in the NAIC Annual Statement filed with such Purchaser’s state of domicile; or
(b)    the Source is a separate account that is maintained solely in connection with such Purchaser’s fixed contractual obligations under which the amounts payable, or credited, to any employee benefit plan (or its related trust) that has any interest in such separate account (or to any participant or beneficiary of such plan (including any annuitant)) are not affected in any manner by the investment performance of the separate account; or
(c)    the Source is either (i) an insurance company pooled separate account, within the meaning of PTE 90‐1 or (ii) a bank collective investment fund, within the meaning of the PTE 91‐38 and, except as disclosed by such Purchaser to the Company in writing pursuant to this clause (c), no employee benefit plan or group of plans maintained by the same employer or employee organization beneficially owns more than 10% of all assets allocated to such pooled separate account or collective investment fund; or
(d)    the Source constitutes assets of an “investment fund” (within the meaning of Part VI of PTE 84‐14 (the “QPAM Exemption”)) managed by a “qualified professional asset manager” or “QPAM” (within the meaning of Part VI of the QPAM Exemption), no employee benefit plan’s assets that are managed by the QPAM in such investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate (within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization and managed by such QPAM, represent more than 20% of the total client assets managed by such QPAM, the conditions of Part I(c) and (g) of the QPAM Exemption are satisfied, neither the QPAM nor a person controlling or controlled by the QPAM maintains an ownership interest in the Company that would cause the QPAM and the Company to be “related” within the meaning of Part VI(h) of the QPAM Exemption and (i) the identity of such QPAM and (ii) the names of any employee benefit plans whose assets in the investment fund, when combined with the assets of all other employee benefit plans established or maintained by the same employer or by an affiliate 

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(within the meaning of Part VI(c)(1) of the QPAM Exemption) of such employer or by the same employee organization, represent 10% or more of the assets of such investment fund, have been disclosed to the Company in writing pursuant to this clause (d); or
(e)    the Source constitutes assets of a “plan(s)” (within the meaning of Part IV(h) of PTE 96‐23 (the “INHAM Exemption”)) managed by an “in‐house asset manager” or “INHAM” (within the meaning of Part IV(a) of the INHAM Exemption), the conditions of Part I(a), (g) and (h) of the INHAM Exemption are satisfied, neither the INHAM nor a person controlling or controlled by the INHAM (applying the definition of “control” in Part IV(d)(3) of the INHAM Exemption) owns a 10% or more interest in the Company and (i) the identity of such INHAM and (ii) the name(s) of the employee benefit plan(s) whose assets constitute the Source have been disclosed to the Company in writing pursuant to this clause (e); or
(f)    the Source is a governmental plan; or
(g)    the Source is one or more employee benefit plans, or a separate account or trust fund comprised of one or more employee benefit plans, each of which has been identified to the Company in writing pursuant to this clause (g); or
(h)    the Source does not include assets of any employee benefit plan, other than a plan exempt from the coverage of ERISA.
As used in this Section 6.2, the terms “employee benefit plan,” “governmental plan,” and “separate account” shall have the respective meanings assigned to such terms in section 3 of ERISA.
Section 7.    Information as to Company.
Section 7.1.    Financial and Business Information.  The Company shall deliver to each Purchaser and each holder of a Note that is an Institutional Investor:
(a)    Quarterly Statements – within 60 days (or such shorter period as is the earlier of (x) 15 days greater than the period applicable to the filing of the General Partner’s Quarterly Report on Form 10‐Q (the “Form 10‐Q”) with the SEC regardless of whether the General Partner is subject to the filing requirements thereof and (y) the date by which such financial statements are required to be delivered under the Primary Credit Facility or the date on which such corresponding financial statements are delivered under the Primary Credit Facility if such delivery occurs earlier than such required delivery date) after the end of each quarterly fiscal period in each fiscal year of the General Partner (other than the last quarterly fiscal period of each such fiscal year), duplicate copies of,
(i)    a consolidated balance sheet of the General Partner, the Company and its consolidated Subsidiaries as at the end of such quarter, and

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(ii)    consolidated statements of income, changes in shareholders’ equity and cash flows of the General Partner, the Company and its consolidated Subsidiaries, for such quarter and (in the case of the second and third quarters) for the portion of the fiscal year ending with such quarter,
setting forth in each case in comparative form the figures for the corresponding periods in the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP applicable to quarterly financial statements generally, and certified by a Senior Financial Officer as fairly presenting, in all material respects, the financial position of the companies being reported on and their results of operations and cash flows, subject to changes resulting from year‐end adjustments and the absence of footnotes; provided that delivery within the time period specified above of copies of the General Partner’s Form 10‐Q prepared in compliance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.1(a);
(b)    Annual Statements – within 120 days (or such shorter period as is the earlier of (x) 15 days greater than the period applicable to the filing of the General Partner’s Annual Report on Form 10‐K (the “Form 10‐K”) with the SEC regardless of whether the General Partner is subject to the filing requirements thereof and (y) the date by which such financial statements are required to be delivered under the Primary Credit Facility or the date on which such corresponding financial statements are delivered under the Primary Credit Facility if such delivery occurs earlier than such required delivery date) after the end of each fiscal year of the General Partner, duplicate copies of
(i)    a consolidated balance sheet of the General Partner, the Company and its consolidated Subsidiaries as at the end of such year, and
(ii)    consolidated statements of income, changes in shareholders’ equity and cash flows of the General Partner, the Company and its consolidated Subsidiaries for such year,
setting forth in each case in comparative form the figures for the previous fiscal year, all in reasonable detail, prepared in accordance with GAAP, and accompanied by an opinion thereon (without a “going concern” or similar qualification or exception and without any qualification or exception as to the scope of the audit on which such opinion is based (except for a qualification or an exception to the extent related to the maturity or refinancing of the Notes or any other Debt) of independent public accountants of recognized national standing, which opinion shall state that such financial statements present fairly, in all material respects, the financial position of the companies being reported upon and their results of operations and cash flows and have been prepared in conformity with GAAP, and that the examination of such accountants in connection with such financial statements has been made in accordance with generally accepted auditing standards, and that such audit provides a reasonable basis for such opinion in the circumstances; provided that delivery within the time period specified above of copies of the General Partner’s Form 10‐K prepared in compliance with the requirements therefor and filed with the SEC shall be deemed to satisfy the requirements of this Section 7.1(b);

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(c)    SEC and Other Reports – promptly upon their becoming available, one copy of (i) each financial statement, report, notice, proxy statement or similar document sent by the Company or any Subsidiary (x) to its creditors under any Material Credit Facility (excluding information sent to such creditors in the ordinary course of administration of a credit facility, such as information relating to pricing and borrowing availability or requests or consents to the eligibility of unencumbered assets, customary or routine periodic financial and servicing statements and compliance certificates and similar matters) or (y) to its public Securities holders generally, and (ii) each regular or periodic report, each registration statement (without exhibits except as expressly requested by such Purchaser or such holder), and each prospectus and all amendments thereto filed by the Company or any Subsidiary with the SEC and of all press releases and other statements made available generally by the Company or any Subsidiary to the public concerning developments that are Material;
(d)    Notice of Default or Event of Default – promptly, and in any event within 5 days after a Responsible Officer becoming aware of the existence of any Default or Event of Default or that any Person has given any notice or taken any action with respect to a claimed default hereunder or that any Person has given any notice or taken any action with respect to a claimed default of the type referred to in Section 11(f), a written notice specifying the nature and period of existence thereof and what action the Company is taking or proposes to take with respect thereto;
(e)    ERISA Matters – promptly, and in any event within 5 days after a Responsible Officer becoming aware of any of the following, a written notice setting forth the nature thereof and the action, if any, that the Company or an ERISA Affiliate proposes to take with respect thereto:
(i)    with respect to any Pension Plan, any reportable event, as defined in section 4043(c) of ERISA and the regulations thereunder, for which notice thereof has not been waived pursuant to such regulations as in effect on the date hereof;
(ii)    the institution by the PBGC of, or the written threat by the PBGC of the institution of, proceedings under section 4042 of ERISA for the termination of, or the appointment of a trustee to administer, any Pension Plan, or the receipt by the Company or any ERISA Affiliate of a notice from a Multiemployer Plan that such action has been taken by the PBGC with respect to such Multiemployer Plan; 
(iii)    any event, transaction or condition that results in the incurrence of any liability by the Company or any ERISA Affiliate pursuant to Title IV of ERISA or the penalty or excise tax provisions of the Code relating to employee pension benefit plans, or in the imposition of any Lien on any of the rights, properties or assets of the Company or any ERISA Affiliate pursuant to Title I or IV of ERISA or such penalty or excise tax provisions, if such liability or Lien, 

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taken together with any other such liabilities or Liens then existing, could reasonably be expected to have a Material Adverse Effect; or
(iv)    receipt of notice of the imposition of a Material financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity or otherwise) with respect to one or more Non‐U.S. Plans;
(f)    Notices from Governmental Authority – promptly, and in any event within 30 days after receipt thereof, copies of any notice to the General Partner, the Company or any Subsidiary from any federal or state Governmental Authority relating to any order, ruling, statute or other law or regulation that could reasonably be expected to have a Material Adverse Effect;
(g)    Resignation or Replacement of Auditors – within 10 days following the date on which the General Partner’s auditors resign or the General Partner elects to change auditors, as the case may be, notification thereof, together with such further information as the Required Holders may request; and
(h)    Unencumbered Assets – if required to be delivered to the lenders under the Primary Credit Facility then in effect, simultaneously with delivery of the information required by Sections 7.1(a) and (b), a statement of Unencumbered Asset Pool Net Operating Cash Flow with respect to each Unencumbered Asset Pool Property and a list of all Unencumbered Asset Pool Properties;
(i)    Requested Information – with reasonable promptness, such other data and information relating to the business, operations, affairs, financial condition, assets or properties of the General Partner, the Company or any of its Subsidiaries (including actual copies of the Company’s Form 10‐Q and Form 10‐K) or relating to the ability of the Company to perform its obligations hereunder and under the Notes as from time to time may be reasonably requested by any such Purchaser or such holder of a Note; provided, that, except as set forth in Section 7.2(a) or as would otherwise be required to be delivered pursuant to Section 7.1(c), so long as no Default or Event of Default has occurred and is continuing, the Company and its Subsidiaries shall not be required to prepare or deliver monthly financial statements or any other financial statements than those (i) described in Section 7.1(a) and (b) above or (ii) included in their Form 10‐Qs and Form 10‐Ks.
Section 7.2.    Officer’s Certificate.  Each set of financial statements delivered to a Purchaser or holder of a Note pursuant to Section 7.1(a) or Section 7.1(b) shall be accompanied by a certificate of a Senior Financial Officer:
(a)    Covenant Compliance – setting forth the information from such financial statements that is required in order to establish whether the Company was in compliance with the requirements of Section 10 (including, without limitation, any covenant incorporated herein pursuant to Section 10.6) during the quarterly or annual period covered by the financial statements then being furnished (including with respect to each 

17

such provision that involves mathematical calculations, the information from such financial statements that is required to perform such calculations) and detailed calculations of the maximum or minimum amount, ratio or percentage, as the case may be, permissible under the terms of such Section, and the calculation of the amount, ratio or percentage then in existence.  In the event that the Company or any Subsidiary (i) has made an election to measure any financial liability using fair value (which election is being disregarded for purposes of determining compliance with this Agreement pursuant to Section 22.2(a)) or (ii) has made an election to use GAAP in effect prior to a change in GAAP in accordance with Section 22.2(b), as to the period covered by any such financial statement, such Senior Financial Officer’s certificate as to such period shall include a reconciliation from GAAP with respect to such election or use of GAAP in effect prior to a change in GAAP; 
(b)    Event of Default – certifying that such Senior Financial Officer has reviewed the relevant terms hereof and has made, or caused to be made, under his or her supervision, a review of the transactions and conditions of the Company and its Subsidiaries from the beginning of the quarterly or annual period covered by the statements then being furnished to the date of the certificate and that such review shall not have disclosed the existence during such period of any condition or event that constitutes a Default or an Event of Default or, if any such condition or event existed or exists (including any such event or condition resulting from the failure of the Company or any Subsidiary to comply with any Environmental Law), specifying the nature and period of existence thereof and what action the Company shall have taken or proposes to take with respect thereto; and
(c)    Subsidiary Guarantors – setting forth a list of all Subsidiaries that are Subsidiary Guarantors and certifying that each Subsidiary that is required to be a Subsidiary Guarantor pursuant to Section 9.7 is a Subsidiary Guarantor, in each case, as of the date of such certificate of Senior Financial Officer (or the steps the Company is taking to cause such required Subsidiary to become a Subsidiary Guarantor).
(d)    Real Property Assets – setting forth the list and value of all Permitted Pledged Real Property Assets eligible to be included in the determination of Unencumbered Asset Pool Properties Value.
Section 7.3.    Visitation.  The Company shall permit the representatives of each Purchaser and each holder of a Note that is an Institutional Investor:
(a)    No Default – if no Default or Event of Default then exists, at the expense of such Purchaser or such holder and upon reasonable prior notice to the Company, to visit the principal executive office of the Company, to discuss the affairs, finances and accounts of the Company and its Subsidiaries with the Company’s officers, and (with the consent of the Company, which consent will not be unreasonably withheld) its independent public accountants (it being understood and agreed that only one such request for a discussion with the Company’s independent public accountants shall be made per fiscal year by all Purchasers and holders of Notes and such discussion shall be 

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held on or around the end of the SAS 100 review period and that representatives of the Company shall be permitted to be present at any such meeting), and (with the consent of the Company, which consent will not be unreasonably withheld) to visit the other offices and properties of the Company and each Subsidiary, all at such reasonable times and as often as may be reasonably requested in writing; provided that only one such visit or one such discussion shall be made per fiscal year by each Purchaser or holder of Notes; and
(b)    Default – if a Default or Event of Default then exists, at the expense of the Company to visit and inspect any of the offices or properties of the Company or any Subsidiary, to examine all their respective books of account, records, reports and other papers, to make copies and extracts therefrom, and to discuss their respective affairs, finances and accounts with their respective officers and independent public accountants (and by this provision the Company authorizes said accountants to discuss the affairs, finances and accounts of the Company and its Subsidiaries (provided that the Company shall receive written notice of such meeting and representatives of the Company shall be entitled (but not required) to be present at any such meeting)), all at such times and as often as may be reasonably requested.
Section 7.4.    Electronic Delivery.  Financial statements, opinions of independent certified public accountants, other information and Officer’s Certificates that are required to be delivered by the Company pursuant to Sections 7.1(a), (b) or (c) or (h) and Section 7.2 shall be deemed to have been delivered if the Company satisfies any of the following requirements with respect thereto:
(a)    such financial statements satisfying the requirements of Section 7.1(a) or (b) and related Officer’s Certificate satisfying the requirements of Section 7.2 and any other information required under Section 7.1(c) are delivered to each Purchaser and each holder of a Note by e‐mail at the e‐mail address set forth on such Purchaser’s or such holder’s Purchaser Schedule or as communicated from time to time in a separate writing delivered to the Company;
(b)    the Company shall have timely filed such Form 10-Q or Form 10-K, satisfying the requirements of Section 7.1(a) or Section 7.1(b), as the case may be, with the SEC on EDGAR and shall have made such form and the related Officer’s Certificate satisfying the requirements of Section 7.2 available on its home page on the internet, which is located at http://www.kilroyrealty.com as of the date of this Agreement; 
(c)    such financial statements satisfying the requirements of Section 7.1(a) or Section 7.1(b) and related Officer’s Certificate(s) satisfying the requirements of Section 7.2 and any other information required under Section 7.1(c) are timely posted by or on behalf of the Company on IntraLinks or on any other similar website to which each Purchaser and each holder of Notes has free access; or 
(d)    the Company shall have timely filed any of the items referred to in Section 7.1(c) with the SEC on EDGAR and shall have made such items available on its 

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home page on the internet or on IntraLinks or on any other similar website to which each Purchaser and each holder of Notes has free access;
provided however, that in no case shall access to such financial statements, other information and Officer’s Certificates be conditioned upon any waiver or other agreement or consent (other than confidentiality provisions consistent with Section 20 of this Agreement); provided further, that in the case of any of clauses (b), (c) or (d), the Company shall have given each Purchaser and each holder of a Note prior written notice, which may be by e‐mail or in accordance with Section 18, of such posting or filing in connection with each delivery, provided further, that upon request of any Purchaser or any holder to receive paper copies of such forms, financial statements, other information and Officer’s Certificates or to receive them by e‐mail, the Company will promptly e‐mail them or deliver such paper copies, as the case may be, to such Purchaser or such holder.
Section 8.        Payment and Prepayment of the Notes.    
Section 8.1.    Maturity.  As provided therein, the entire unpaid principal balance of each Note shall be due and payable on the Maturity Date thereof.
Section 8.2.    Optional Prepayments with Make‐Whole Amount.  (a) The Company may, at its option, upon notice as provided below, prepay at any time all, or from time to time any part of, any series of Notes, in an amount not less than 5% of the aggregate principal amount of any series of Notes then outstanding in the case of a partial prepayment, at 100% of the principal amount so prepaid, and the Make‐Whole Amount determined for the prepayment date with respect to such principal amount; provided, that in the event such prepayment pursuant to this Section 8.2 occurs on or after (a) December 19, 2026 in the case of the Series A Notes and (b) December 19, 2028 in the case of the Series B Notes, Notes of such series may be prepaid at 100% of the principal amount of such Notes, together with interest on such Notes accrued to the date of prepayment, but without Make‐Whole Amount or other premium.  The Company will give each holder of Notes written notice of each optional prepayment under this Section 8.2 not less than ten days and not more than 60 days prior to the date fixed for such prepayment unless the Company and the holders of more than 50% of the principal amount of the Notes of such series to be prepaid then outstanding agree to another time period pursuant to Section 17.  Each such notice shall specify such date (which shall be a Business Day), the aggregate principal amount of such series of Notes to be prepaid on such date, the principal amount of each Note of such series held by such holder to be prepaid (determined in accordance with Section 8.3), and the interest to be paid on the prepayment date with respect to such principal amount being prepaid, and shall be accompanied by a certificate of a Senior Financial Officer as to the estimated Make‐Whole Amount (if any) for each series due in connection with such prepayment (calculated as if the date of such notice were the date of the prepayment), setting forth the details of such computation.  Two Business Days prior to such prepayment, the Company shall deliver to each holder of Notes a certificate of a Senior Financial Officer specifying the calculation of such Make‐Whole Amount (if any) as of the specified prepayment date.
(b)    Notwithstanding anything contained in this Section 8.2 to the contrary, if and so long as any Default or Event of Default shall have occurred and be continuing, any partial prepayment of the Notes pursuant to the provisions of Section 8.2(a) shall be allocated among all 

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of the Notes of all series at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof.
Section 8.3.    Allocation of Partial Prepayments.  (a) In the case of each partial prepayment of a series of Notes pursuant to Section 8.2(a), the principal amount of the Notes of such series to be prepaid shall be allocated among all of the Notes of such series at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment.
(b)    In the case of each partial prepayment of a series of Notes pursuant to Section 8.2(b), the principal amount of the Notes to be prepaid shall be allocated among all of the Notes regardless of series at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof not theretofore called for prepayment.
(c)    Any prepayments pursuant to Section 8.7 shall be applied only to the Notes of the holders electing to participate in such prepayment.
Section 8.4.    Maturity; Surrender, Etc.      In the case of each prepayment of Notes pursuant to this Section 8, the principal amount of each Note to be prepaid shall mature and become due and payable on the date fixed for such prepayment, together with interest on such principal amount accrued to such date and the applicable Make‐Whole Amount, if any.  From and after such date, unless the Company shall fail to pay such principal amount when so due and payable, together with the interest and Make‐Whole Amount, if any, as aforesaid, interest on such principal amount shall cease to accrue.  Any Note paid or prepaid in full shall be surrendered to the Company and cancelled and shall not be reissued, and no Note shall be issued in lieu of any prepaid principal amount of any Note.
Section 8.5.    Purchase of Notes.  The Company will not and will not permit any Affiliate to purchase, redeem, prepay or otherwise acquire, directly or indirectly, any of the outstanding Notes of any series except (a) upon the payment or prepayment of the Notes of any series in accordance with this Agreement and the Notes or (b) pursuant to an offer to purchase made by the Company or any other Affiliate pro rata to the holders of all Notes of any series at the time outstanding upon the same terms and conditions.  Any such offer shall provide each holder with sufficient information to enable it to make an informed decision with respect to such offer, and shall remain open for at least 10 Business Days.  If the holders of more than 50% of the principal amounts of the Notes of the applicable series then outstanding accept such offer, the Company shall promptly notify the remaining holders of such series of Notes of such fact and the expiration date for the acceptance by holders of such series of Notes shall be extended by the number of days necessary to give each such remaining holder at least 10 Business Days from its receipt of notice to accept such offer.  The Company will promptly cancel all Notes acquired by it or any Affiliate pursuant to any payment, prepayment or purchase of Notes pursuant to this Agreement and no Notes may be issued in substitution or exchange for any such Notes.  Notwithstanding anything contained in this Section 8.5 to the contrary, if and so long as any Default or Event of Default shall have occurred and be continuing, any offer to purchase the Notes pursuant to the provisions of Section 8.5(b) shall be allocated among all of the Notes of all 

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series at the time outstanding in proportion, as nearly as practicable, to the respective unpaid principal amounts thereof.
Section 8.6.    Make‐Whole Amount.
The term “Make‐Whole Amount” means, with respect to any Note of any series, an amount equal to the excess, if any, of the Discounted Value of the Remaining Scheduled Payments with respect to the Called Principal of such Note over the amount of such Called Principal, provided that the Make‐Whole Amount may in no event be less than zero.  
For the purposes of determining the Make‐Whole Amount, the following terms have the following meanings:
“Called Principal” means, with respect to any Note of any series, the principal of such Note that is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.
“Discounted Value” means, with respect to the Called Principal of any Note of any series, the amount obtained by discounting all Remaining Scheduled Payments with respect to such Called Principal from their respective scheduled due dates to the Settlement Date with respect to such Called Principal, in accordance with accepted financial practice and at a discount factor (applied on the same periodic basis as that on which interest on the Notes is payable) equal to the Reinvestment Yield with respect to such Called Principal.
“Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of (a) 0.50% plus (b) the yield to maturity implied by the “Ask Yield(s)” reported as of 10:00 a.m. (New York City time) on the second Business Day preceding the Settlement Date with respect to such Called Principal, on the display designated as “Page PX1” (or such other display as may replace Page PX1) on Bloomberg Financial Markets for the most recently issued actively traded on‐the‐run U.S. Treasury securities (“Reported”) having a maturity equal to the Remaining Average Life of such Called Principal as of such Settlement Date.  If there are no such U.S. Treasury securities Reported having a maturity equal to such Remaining Average Life, then such implied yield to maturity will be determined by (i) converting U.S. Treasury bill quotations to bond equivalent yields in accordance with accepted financial practice and (ii) interpolating linearly between the “Ask Yields” Reported for the applicable most recently issued actively traded on‐the‐run U.S. Treasury securities with the maturities (1) closest to and greater than such Remaining Average Life and (2) closest to and less than such Remaining Average Life.  The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.
If such yields are not Reported or the yields Reported as of such time are not ascertainable (including by way of interpolation), then “Reinvestment Yield” means, with respect to the Called Principal of any Note, the sum of (x) 0.50% plus (y) the yield to maturity implied by the U.S. Treasury constant maturity yields reported, for the latest day for which such yields have been so reported as of the second Business Day preceding the Settlement Date with respect to such Called Principal, in Federal Reserve Statistical Release H.15 (or any comparable 

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successor publication) for the U.S. Treasury constant maturity having a term equal to the Remaining Average Life of such Called Principal as of such Settlement Date.  If there is no such U.S. Treasury constant maturity having a term equal to such Remaining Average Life, such implied yield to maturity will be determined by interpolating linearly between (1) the U.S. Treasury constant maturity so reported with the term closest to and greater than such Remaining Average Life and (2) the U.S. Treasury constant maturity so reported with the term closest to and less than such Remaining Average Life.  The Reinvestment Yield shall be rounded to the number of decimal places as appears in the interest rate of the applicable Note.
“Remaining Average Life” means, with respect to any Called Principal, the number of years obtained by dividing (i) such Called Principal into (ii) the sum of the products obtained by multiplying (a) the principal component of each Remaining Scheduled Payment with respect to such Called Principal by (b) the number of years, computed on the basis of a 360‐day year comprised of twelve 30‐day months and calculated to two decimal places, that will elapse between the Settlement Date with respect to such Called Principal and the scheduled due date of such Remaining Scheduled Payment.
“Remaining Scheduled Payments” means, with respect to the Called Principal of any Note of any series, all payments of such Called Principal and interest thereon that would be due after the Settlement Date with respect to such Called Principal if no payment of such Called Principal were made prior to its scheduled due date, provided that if such Settlement Date is not a date on which interest payments are due to be made under the Notes, then the amount of the next succeeding scheduled interest payment will be reduced by the amount of interest accrued to such Settlement Date and required to be paid on such Settlement Date pursuant to Section 8.2 or Section 12.1.
“Settlement Date” means, with respect to the Called Principal of any Note, the date on which such Called Principal is to be prepaid pursuant to Section 8.2 or has become or is declared to be immediately due and payable pursuant to Section 12.1, as the context requires.
Section 8.7.    Change of Control.
(a)    Notice of Change of Control.  The Company will, within ten (10) Business Days after the occurrence of any Change of Control, give written notice (the “Change of Control Notice”) of such Change of Control to each holder of Notes.  Such Change of Control Notice shall contain and constitute an offer to prepay the Notes as described in Section 8.7(b) hereof and shall be accompanied by the certificate described in Section 8.7(e).
(b)    Offer to Prepay Notes.  The offer to prepay Notes contemplated by Section 8.7(a) shall be an offer to prepay, in accordance with and subject to this Section 8.7, all, but not less than all, the Notes held by each holder (in this case only, “holder” in respect of any Note registered in the name of a nominee for a disclosed beneficial owner shall mean such beneficial owner) on a date specified in such Change of Control Notice (the “Proposed Prepayment Date”).  Such date shall be not fewer than 30 days and not more than 60 days after the date of delivery of the Change of Control Notice.

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(c)    Acceptance.  Any holder of Notes may accept the offer to prepay made pursuant to this Section 8.7 by causing a notice of such acceptance to be delivered to the Company not fewer than 10 days prior to the Proposed Prepayment Date.  A failure by a holder of Notes to respond to an offer to prepay made pursuant to this Section 8.7 shall be deemed to constitute a rejection of such offer by such holder.
(d)    Prepayment.  Prepayment of the Notes to be prepaid pursuant to this Section 8.7 shall be at 100% of the principal amount of such Notes together with accrued and unpaid interest thereon but without any Make‐Whole Amount or other premium.  The prepayment shall be made on the Proposed Prepayment Date.
(e)    Officer’s Certificate.  Each offer to prepay the Notes pursuant to this Section 8.7 shall be accompanied by a certificate, executed by a Senior Financial Officer and dated the date of delivery of the Change of Control Notice, specifying:  (i) the Proposed Prepayment Date; (ii) that such offer is made pursuant to this Section 8.7; (iii) the principal amount of each Note offered to be prepaid (which shall be 100% of the outstanding principal balance of each such Note); (iv) the interest that would be due on each Note offered to be prepaid, accrued to the Proposed Prepayment Date; (v) that the conditions of this Section 8.7 required to be fulfilled prior to the giving of notice have been fulfilled; and (vi) in reasonable detail, the general nature and date of the Change of Control.
Section 8.8.    Payments Due on Non‐Business Days.  Anything in this Agreement or the Notes to the contrary notwithstanding, (x) except as set forth in clause (y), any payment of interest on any Note that is due on a date that is not a Business Day shall be made on the next succeeding Business Day without including the additional days elapsed in the computation of the interest payable on such next succeeding Business Day; and (y) any payment of principal of or Make‐Whole Amount on any Note (including principal due on the Maturity Date of such Note) that is due on a date that is not a Business Day shall be made on the next succeeding Business Day and shall include the additional days elapsed in the computation of interest payable on such next succeeding Business Day.
		
	Section 9.
	Affirmative Covenants.

From the Execution Date until the Closing and thereafter, so long as any of the Notes are outstanding, the Company covenants that:
Section 9.1.    Compliance with Laws.  Without limiting Section 10.4, the Company will, and will cause each of its Subsidiaries to, comply with all laws, ordinances or governmental rules or regulations to which each of them is subject (including ERISA, Environmental Laws, the USA PATRIOT Act and the other laws and regulations that are referred to in Section 5.16) and will obtain and maintain in effect all licenses, certificates, permits, franchises and other governmental authorizations necessary to the ownership of their respective properties or to the conduct of their respective businesses, in each case to the extent necessary to ensure that non‐compliance with such laws, ordinances or governmental rules or regulations or failures to obtain or maintain in effect such licenses, certificates, permits, franchises and other governmental authorizations could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

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Section 9.2.    Insurance.  The Company will, and will cause each of its Subsidiaries to, maintain, with financially sound and reputable insurers, insurance with respect to their respective properties and businesses against such casualties and contingencies, of such types, on such terms and in such amounts (including deductibles, co‐insurance and self‐insurance, if adequate reserves are maintained with respect thereto) as is customary in the case of entities of established reputations engaged in the same or a similar business and similarly situated.
Section 9.3.    Maintenance of Properties.  The Company will, and will cause each of its Subsidiaries to, maintain and keep, or cause to be maintained and kept, their respective properties in good repair, working order and condition (other than ordinary wear and tear), so that the business carried on in connection therewith may be properly conducted at all times, except where the failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 9.4.    Payment of Taxes and Claims.  The Company will, and will cause each of its Subsidiaries to, file all material tax returns required to be filed in any jurisdiction and to pay and discharge all taxes shown to be due and payable on such returns and all other taxes, assessments, governmental charges, or levies imposed on them or any of their properties, assets, income or franchises, to the extent the same have become due and payable and before they have become delinquent and all claims for which sums have become due and payable that have or might become a Lien on properties or assets of the Company or any Subsidiary, provided that neither the Company nor any Subsidiary need pay any such tax, assessment, charge, levy or claim if (i) the amount, applicability or validity thereof is contested by the Company or such Subsidiary on a timely basis in good faith and in appropriate proceedings, and the Company or a Subsidiary has established adequate reserves therefor in accordance with GAAP on the books of the Company or such Subsidiary or (ii) the nonpayment of all such taxes, assessments, charges, levies and claims could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
Section 9.5.    Corporate Existence, Etc.  Subject to Section 10.2, the Company will at all times preserve and keep its limited partnership existence in full force and effect.  Subject to Section 10.2, the Company will at all times preserve and keep in full force and effect the corporate, limited partnership or limited liability company existence of each of its Subsidiaries (unless merged into the Company or a Wholly‐Owned Subsidiary) and all rights and franchises of the Company and its Subsidiaries unless, in the good faith judgment of the Company, the termination of or failure to preserve and keep in full force and effect such corporate existence, right or franchise could not, individually or in the aggregate, have a Material Adverse Effect.
Section 9.6.    Books and Records.  The Company will, and will cause each of its Subsidiaries to, maintain proper books of record and account in conformity with GAAP and in conformity in all material respects with all applicable requirements of any Governmental Authority having legal or regulatory jurisdiction over the Company or such Subsidiary, as the case may be.  The Company will, and will cause each of its Subsidiaries to, keep books, records and accounts which, in reasonable detail, accurately reflect in all material respects all transactions and dispositions of assets.  The Company and its Subsidiaries have devised a system of internal accounting controls sufficient to provide reasonable assurances that their respective 

25

books, records, and accounts accurately reflect all transactions and dispositions of assets and the Company will, and will cause each of its Subsidiaries to, continue to maintain such system.
Section 9.7.    Subsidiary Guarantors.  (a) The Company will cause each of its Subsidiaries that guarantees or otherwise becomes liable at any time, whether as a borrower or an additional or co‐borrower or otherwise, for or in respect of any Debt under any Material Credit Facility to concurrently therewith:
(i)    enter into an agreement (or joinder to an existing Subsidiary Guaranty if a Subsidiary Guaranty has previously been delivered hereunder) in form and substance reasonably satisfactory to the Required Holders providing for the guaranty by such Subsidiary, on a joint and several basis with all other such Subsidiaries, of (x) the prompt payment in full when due of all amounts payable by the Company pursuant to the Notes (whether for principal, interest, Make‐Whole Amount or otherwise) and this Agreement, including all indemnities, fees and expenses payable by the Company thereunder and (y) the prompt, full and faithful performance, observance and discharge by the Company of each and every covenant, agreement, undertaking and provision required pursuant to the Notes or this Agreement to be performed, observed or discharged by it (a “Subsidiary Guaranty”); and
(ii)    deliver the following to each Purchaser and each holder of a Note:
(A)    an executed counterpart of such Subsidiary Guaranty or joinder thereto;
(B)    to the extent required under any Material Credit Facility, a certificate signed by an authorized responsible officer of such Subsidiary containing representations and warranties on behalf of such Subsidiary to the same effect, mutatis mutandis, as those contained in Sections 5.1, 5.2, 5.6 and 5.7 of this Agreement (but with respect to such Subsidiary and such Subsidiary Guaranty rather than the Company);
(C)    to the extent required under any Material Credit Facility, all documents as may be reasonably requested by the Required Holders to evidence the due organization, continuing existence and, where applicable, good standing of such Subsidiary and the due authorization by all requisite action on the part of such Subsidiary of the execution and delivery of such Subsidiary Guaranty or joinder thereto and the performance by such Subsidiary of its obligations thereunder; and
(D)    to the extent required under any Material Credit Facility, an opinion of counsel reasonably satisfactory to the Required Holders covering such matters relating to such Subsidiary and such Subsidiary Guaranty as the Required Holders may reasonably request.

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(b)    At the election of the Company and by written notice to each Purchaser and each holder of Notes, any Subsidiary Guarantor that has provided a Subsidiary Guaranty (or a joinder thereto) under subparagraph (a) of this Section 9.7 may be discharged from all of its obligations and liabilities under its Subsidiary Guaranty (and joinder thereto, as the case may be) and shall be automatically released from its obligations thereunder without the need for the execution or delivery of any other document by the Purchasers or holders, provided that (i) if such Subsidiary Guarantor is a guarantor or is otherwise liable for or in respect of any Material Credit Facility, then such Subsidiary Guarantor has been released and discharged (or will be released and discharged concurrently with the release of such Subsidiary Guarantor under its Subsidiary Guaranty (and joinder thereto, as the case may be)) under such Material Credit Facility, (ii) at the time of, and after giving effect to, such release and discharge, no Default or Event of Default shall be existing, (iii) no amount is then due and payable under such Subsidiary Guaranty, (iv) if in connection with such Subsidiary Guarantor being released and discharged under any Material Credit Facility, any fee or other form of consideration is given to any holder of Debt under such Material Credit Facility for such release, the holders of the Notes shall receive equivalent consideration substantially concurrently therewith and (v) each holder shall have received a certificate of a Responsible Officer certifying as to the matters set forth in clauses (i) through (iv).
Section 9.8.    General Partner Status.  The Company shall at all times cause the General Partner to (i) maintain its status as a self‐directed and self‐administered REIT under the Code, (ii) remain in compliance in all material respects with all provisions applicable to the qualification of the Company as a REIT under the Code and (iii) remain (or its successor to remain) listed, traded or quoted on the New York Stock Exchange, NASDAQ, or other public exchange or automated quotation system.
Section 9.9.    Priority of Obligations.  The Company will ensure that its payment obligations under this Agreement and the Notes, and the payment obligations of any Note Guarantor under its Note Guaranty, will at all times rank at least pari passu, without preference or priority, with all other unsecured and unsubordinated Debt of the Company and such Note Guarantor, as applicable.
Notwithstanding the terms of Section 11, it will not be a Default or an Event of Default if the Company fails to comply with any provision of Section 9 on or after the Execution Date and prior to the Closing (including after giving effect to the issuance of the Notes on a pro forma basis); however, if such failure occurs, then any of the Purchasers may elect not to purchase the Notes on the date of the Closing that is specified in Section 3.
		
	Section 10.
	Negative Covenants.

From the Execution Date until the Closing and thereafter, so long as any of the Notes are outstanding, the Company covenants that:
Section 10.1.    Transactions with Affiliates.  The Company will not, and will not permit any Subsidiary to, enter into directly or indirectly any transaction or group of related transactions (including the purchase, lease, sale or exchange of properties of any kind or the rendering of any 

27

service) with any Affiliate (other than the General Partner, the Company or another Subsidiary), except in the ordinary course and pursuant to the reasonable requirements of the Company’s or such Subsidiary’s business and upon fair and reasonable terms no less favorable to the Company or such Subsidiary than would be obtainable in a comparable arm’s‐length transaction with a Person not an Affiliate.
Section 10.2.    Merger, Consolidation, Etc.  The Company will not, and will not permit any Subsidiary Guarantor to, consolidate with or merge with any other Person or convey, transfer or lease all or substantially all of its assets in a single transaction or series of transactions to any Person unless:
(a)    in the case of any such transaction involving the Company, the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or lease all or substantially all of the assets of the Company as an entirety, as the case may be, shall be a Solvent corporation, limited liability company or limited partnership organized and existing under the laws of the United States or any state thereof (including the District of Columbia), and, if the Company is not such corporation, limited liability company or limited partnership, (i) such corporation, limited liability company or limited partnership shall have executed and delivered to each holder of any Notes its assumption of the due and punctual performance and observance of each covenant and condition of this Agreement and the Notes and (ii) such corporation, limited liability company or limited partnership shall have caused to be delivered to each holder of any Notes an opinion of nationally recognized independent counsel, or other independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof;
(b)    in the case of any such transaction involving a Subsidiary Guarantor, the successor formed by such consolidation or the survivor of such merger or the Person that acquires by conveyance, transfer or lease all or substantially all of the assets of such Subsidiary Guarantor as an entirety, as the case may be, shall be (1) the General Partner, the Company, such Subsidiary Guarantor or another Subsidiary Guarantor; (2) (A) a Solvent corporation, limited liability company or limited partnership (other than the General Partner, the Company or another Subsidiary Guarantor), (B) that, if such Subsidiary Guarantor was organized and existing under the laws of the United States or any state thereof (including the District of Columbia), is organized and existing under the laws of the United States or any state thereof (including the District of Columbia) and (C) if such Subsidiary Guarantor is not such corporation, limited liability company or limited partnership, (x) such corporation, limited liability company or limited partnership shall have executed and delivered to each holder of Notes its assumption of the due and punctual performance and observance of each covenant and condition of the Subsidiary Guaranty of such Subsidiary Guarantor and (y) the Company shall have caused to be delivered to each holder of Notes an opinion of nationally recognized independent counsel, or other independent counsel reasonably satisfactory to the Required Holders, to the effect that all agreements or instruments effecting such assumption are enforceable in accordance with their terms and comply with the terms hereof; or (3) any other Person so 

28

long as the transaction is treated as a disposition of all of the assets of such Subsidiary Guarantor for purposes of this Agreement and, based on such characterization, would be permitted pursuant to this Agreement;
(c)    in the case of such transaction involving the Company, each Note Guarantor under any Note Guaranty that is outstanding at the time such transaction or each transaction in such a series of transactions occurs reaffirms its obligations under such Note Guaranty in writing at such time pursuant to documentation that is reasonably acceptable to the Required Holders; and
(d)    immediately before and immediately after giving effect to such transaction or each transaction in any such series of transactions, no Default or Event of Default shall have occurred and be continuing.
No such conveyance, transfer or lease of substantially all of the assets of the Company or any Subsidiary Guarantor shall have the effect of releasing the Company or such Subsidiary Guarantor, as the case may be, or any successor corporation, limited liability company or limited partnership that shall theretofore have become such in the manner prescribed in this Section 10.2, from its liability under (x) this Agreement or the Notes (in the case of the Company) or (y) the Subsidiary Guaranty (in the case of any Subsidiary Guarantor), unless, in the case of the conveyance, transfer or lease of substantially all of the assets of a Subsidiary Guarantor, such Subsidiary Guarantor is released from its Subsidiary Guaranty in accordance with Section 9.7(b) in connection with or immediately following such conveyance, transfer or lease.
Section 10.3.    Line of Business.  The Company will not and will not permit any Subsidiary to engage in any business if, as a result, the general nature of the business in which the Company and its Subsidiaries, taken as a whole, would then be engaged would be substantially changed from the general nature of the business in which the Company and its Subsidiaries, taken as a whole, are engaged on the date of this Agreement as described in the Investor Presentation.
Section 10.4.    Economic Sanctions, Etc.  The Company will not, and will not permit any Controlled Entity to (a) become (including by virtue of being owned or controlled by a Blocked Person), own or control a Blocked Person or (b) directly or indirectly have any investment in or engage in any dealing or transaction (including any investment, dealing or transaction involving the proceeds of the Notes) with any Person if such investment, dealing or transaction (i) would cause any holder or any affiliate of such holder to be in violation of, or subject to sanctions under, any law or regulation applicable to such holder, or (ii) is prohibited by or subject to sanctions under any U.S. Economic Sanctions Laws.
Section 10.5.    Financial Covenants. 
(a)    Total Debt to Total Asset Value.  As of the last day of each calendar quarter, the Company shall not permit the Total Debt Ratio to be greater than 60%; provided, however, with respect to any period in which the Company or any of its Consolidated Subsidiaries have acquired a Real Property Asset (or multiple Real Property Assets in a single transaction) for a 

29

price of more than $150,000,000, Total Debt to Total Asset Value for such quarter and the next succeeding quarter may increase to 65% (an “NPA Acquisition Spike”), provided such ratio shall not exceed 60% thereafter unless the Company or any of its Consolidated Subsidiaries have acquired another Real Property Asset (or multiple Real Property Assets in a single transaction) for a price of more than $150,000,000, in a subsequent quarter in which event the NPA Acquisition Spike shall again apply. 
Notwithstanding the foregoing, if at any time any similar acquisition spike under the Primary Credit Facility (a “Bank Acquisition Spike”) is excluded, terminated, tightened, amended or otherwise modified or limited with the result that such Bank Acquisition Spike is more restrictive than the NPA Acquisition Spike, the NPA Acquisition Spike shall similarly be so excluded, terminated, tightened, amended or otherwise modified or limited to the same extent as the exclusion, termination, tightening or other amendment or modification thereof under the Primary Credit Facility; provided, that in the event the Bank Acquisition Spike is thereafter subsequently loosened, relaxed, amended or otherwise modified to be less restrictive, the NPA Acquisition Spike shall similarly be thereafter so loosened, relaxed, amended or otherwise modified; provided that if a Default or Event of Default shall have occurred and be continuing at the time the Bank Acquisition Spike is to be so subsequently loosened, relaxed, amended or otherwise modified to be less restrictive, the prior written consent thereto of the Required Holders shall be required as a condition to the loosening or other amendment or modification of the NPA Acquisition Spike; and provided, further, that in any and all events, the NPA Acquisition Spike shall not in any event be deemed or construed to be loosened, relaxed, amended or otherwise modified by operation of the terms of this Section 10.5(a) to be less restrictive on the Company than the NPA Acquisition Spike as in effect on the date of this Agreement.
(b)    Fixed Charge Coverage.  As of the last day of each calendar quarter, the Company shall not permit the ratio of (x) Annual EBITDA, less reserves for Capital Expenditures of (i) $.30 per square foot per annum for each Real Property Asset that is an office property and (ii) $.15 per square foot per annum for each Real Property Asset that is an industrial property to (y) the sum of (i) Total Debt Service and (ii) dividends or other payments payable by the General Partner with respect to any preferred stock issued by the General Partner and distributions or other payments payable by the Company with respect to any preferred partnership units of the Company, to be less than 1.50:1.00.
(c)    Limitation on Secured Debt.  The Company shall not permit the Secured Debt of the Company, the General Partner and their Consolidated Subsidiaries on a consolidated basis, which for purposes hereof shall be deemed to include the Company’s and the General Partner’s pro rata share of the Secured Debt of any Minority Holdings of the Company or the General Partner, to at any time exceed forty percent (40%) of Total Asset Value.  
(d)    Unsecured Debt Ratio.  The Company shall not at any time permit the Unsecured Debt Ratio to be less than 1.50:1.0; provided that at any time the value of any Permitted Pledged Real Property Assets is eligible to be included in the determination of Unencumbered Asset Pool Properties Value, the Company shall not permit the Unsecured Debt Ratio to be less than 1.60:1.0.

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Section 10.6.    Most Favored Lender Status.  (a) If (i) as of the date of this Agreement, the Primary Credit Facility, or (ii) after the date of this Agreement, the General Partner, the Company or any Subsidiary Guarantor enters into any amendment or other modification of the Primary Credit Facility, or (iii) after the date of this Agreement, the General Partner, the Company or any Subsidiary Guarantor enters into any new Primary Credit Facility that in any such case has on the date of this Agreement, or after the date of this Agreement results in, one or more additional or more restrictive MFL Provisions than those contained in this Agreement being contained in any such Primary Credit Facility (such additional or more restrictive MFL Provision, together with all definitions relating thereto, the “Primary Credit Facility Additional Provision(s)”), then the terms of this Agreement, without any further action on the part of the General Partner, the Company, any Subsidiary Guarantor or any of the holders of the Notes, will unconditionally be deemed on the effective date of such Primary Credit Facility Additional Provision(s) to be automatically amended to include such Primary Credit Facility Additional Provision(s), and any event of default in respect of any such additional or more restrictive MFL Provision(s) so included herein shall be deemed to be an Event of Default under Section 11(c) (after giving effect to any grace or cure provisions under such Primary Credit Facility Additional Provision(s), subject to all applicable terms and provisions of this Agreement, including, without limitation, all rights and remedies exercisable by the holders of the Notes hereunder.
(b)    If after the date of execution of the Primary Credit Facility, any one or more of the Primary Credit Facility Additional Provision(s) is excluded, terminated, loosened, tightened, amended or otherwise modified under the Primary Credit Facility, then and in such event any such Primary Credit Facility Additional Provision(s) theretofore included in this Agreement pursuant to the requirements of this Section 10.6 shall then and thereupon automatically and without any further action by any Person be so excluded, terminated, loosened, tightened or otherwise amended or modified under this Section 10.6 to the same extent as the exclusion, termination, loosening, tightening of other amendment or modification thereof under the Primary Credit Facility; provided that if a Default or Event of Default shall have occurred and be continuing by reason of the Primary Credit Facility Additional Provision(s) at the time any such Primary Credit Facility Additional Provision(s) is or are to be so excluded, terminated, loosened, tightened, amended or modified under this Section 10.6, the prior written consent thereto of the Required Holders shall be required as a condition to the exclusion, termination, loosening, tightening or other amendment or modification of any such Primary Credit Facility Additional Provision(s), as the case may be; and provided, further, that in any and all events, the financial covenant(s) and related definitions or any event of default constituting any financial covenant and Events of Default contained in this Agreement as in effect on the date of this Agreement shall not in any event be deemed or construed to be excluded, terminated, loosened, relaxed, amended or otherwise modified by operation of the terms of this Section 10.6, and only any such Primary Credit Facility Additional Provision(s) shall be so excluded, terminated, loosened, tightened, amended or otherwise modified pursuant to the terms hereof.
(c)    The Company shall from time to time, upon request by the Required Holders, promptly execute and deliver at its expense (including, without limitation, the reasonable and documented fees and expenses of one counsel for the holders of the Notes, taken as a whole) an amendment to this Agreement in form and substance reasonably satisfactory to the Required 

31

Holders evidencing that, pursuant to this Section 10.6, this Agreement then and thereafter includes, excludes, amends or otherwise modifies any Primary Credit Facility Additional Provision(s), as the case may be; provided that the execution and delivery of such amendment shall not be a precondition to the effectiveness of such amendment.
(d)    The Company agrees that it will not, nor will it permit any Subsidiary or Affiliate to, directly or indirectly, pay or cause to be paid any consideration or remuneration, whether by way of supplemental or additional interest, fee or otherwise, to any creditor of the Company, any co‐obligor or any Note Guarantor as consideration for or as an inducement to the entering into by any such creditor of any amendment, waiver or other modification to the Primary Credit Facility, the effect of which amendment, waiver or other modification is to exclude, terminate, loosen, tighten or otherwise amend or modify any Primary Credit Facility Additional Provision(s), unless such consideration or remuneration is concurrently paid, on the same terms, ratably to the holders of all of the Notes then outstanding.
(e)    The parties hereto acknowledge and agree that as of the date of this Agreement the “Unencumbered Asset Pool Debt Service Coverage” and “Dividends” covenants set forth in Section 5.8(e) and (f), respectively, of the Bank Credit Agreement shall constitute Primary Credit Facility Additional Provision(s).
Notwithstanding the terms of Section 11, it will not be a Default or an Event of Default if the Company fails to comply with any provision of Section 10 on or after the Execution Date and prior to the Closing (including after giving effect to the issuance of the Notes on a pro forma basis); however, if such failure occurs, then any of the Purchasers may elect not to purchase the Notes on the date of the Closing that is specified in Section 3.
		
	Section 11.
	Events of Default.

An “Event of Default” shall exist if any of the following conditions or events shall occur and be continuing:
(a)    the Company defaults in the payment of any principal or Make‐Whole Amount, if any, on any Note when the same becomes due and payable, whether at maturity or at a date fixed for prepayment or by declaration or otherwise; or
(b)    the Company defaults in the payment of any interest on any Note for more than five Business Days after the same becomes due and payable; or
(c)    the Company defaults in the performance of or compliance with any term contained in Section 7.1(d) or Section 10.5 or incorporated herein pursuant to Section 10.6 (after giving effect to any grace or cure provisions under such Primary Credit Facility Additional Provision(s) so incorporated); or
(d)    the Company or any Note Guarantor defaults in the performance of or compliance with any term contained herein (other than those referred to in Sections 11(a), (b) and (c)) or in any Note Guaranty and such default is not remedied within 30 days after 

32

the earlier of (i) a Responsible Officer obtaining actual knowledge of such default and (ii) the Company receiving written notice of such default from any holder of a Note (any such written notice to be identified as a “notice of default” and to refer specifically to this Section 11(d)); or
(e)    (i) any representation or warranty made in writing by or on behalf of the Company or by any officer of the Company in this Agreement or any writing furnished in connection with the transactions contemplated hereby proves to have been false or incorrect in any material respect on the date as of which made, or (ii) any representation or warranty made in writing by or on behalf of any Note Guarantor or by any officer of such Note Guarantor in any Note Guaranty or any writing furnished in connection with such Note Guaranty proves to have been false or incorrect in any material respect on the date as of which made; or
(f)    (i) the Company, the General Partner or any Material Subsidiary is in default (as principal or as guarantor or other surety) in the payment of any principal of or premium or make‐whole amount or interest on any Recourse Debt or Debt guaranteed by the Company, the General Partner or such Material Subsidiary (other than Debt under the Note Documents) that is outstanding in an aggregate principal amount of at least $50,000,000 (or its equivalent in the relevant currency of payment) (provided, that if at any time the threshold for Debt which may trigger a cross default, cross acceleration or similar provision under the Primary Credit Facility at such time is greater than $50,000,000, the threshold for Debt which may trigger an Event of Default under this clause shall be such greater amount for so long as such greater amount shall remain in effect under such Primary Credit Facility, provided, further, however that, notwithstanding the terms of the Primary Credit Facility, in no event shall the threshold for Debt which may trigger an Event of Default under this clause be greater than $125,000,000) beyond any period of grace provided with respect thereto, and such default shall not be waived by the applicable lender (which waiver shall serve to reinstate the applicable loan), or (ii) the Company, the General Partner or any Material Subsidiary is in default in the performance of or compliance with any term of any evidence of any Recourse Debt or Debt guaranteed by the Company, the General Partner or such Material Subsidiary (other than Debt under the Note Documents) in an aggregate outstanding principal amount of at least $50,000,000 (or its equivalent in the relevant currency of payment) (provided, that if at any time the threshold for Debt which may trigger a cross default, cross acceleration or similar provision under the Primary Credit Facility at such time is greater than $50,000,000, the threshold for Debt which may trigger an Event of Default under this clause shall be such greater amount for so long as such greater amount shall remain in effect under such Primary Credit Facility, provided, further, however that, notwithstanding the terms of the Primary Credit Facility, in no event shall the threshold for Debt which may trigger an Event of Default under this clause be greater than $125,000,000) or of any mortgage, indenture or other agreement relating thereto or any other condition exists, and as a consequence of such default or condition such Debt has become, or has been declared (or one or more Persons are entitled to declare such Debt to be), due and payable before its stated maturity or before its regularly scheduled dates of payment, and such default shall not be waived by the applicable lender (which waiver 

33

shall serve to reinstate the applicable loan), or (iii) as a consequence of the occurrence or continuation of any event or condition (other than the passage of time or the right of the holder of Recourse Debt or Debt guaranteed by the Company, the General Partner or such Material Subsidiary (other than Debt under the Note Documents) to convert such Debt into equity interests), and such event or condition shall not be waived by the applicable lender (which waiver shall serve to reinstate the applicable loan), (x) the Company, the General Partner or any Material Subsidiary has become obligated to purchase or repay Recourse Debt or Debt guaranteed by the Company, the General Partner or such Material Subsidiary (other than Debt under the Note Documents) before its regular maturity or before its regularly scheduled dates of payment in an aggregate outstanding principal amount of at least $50,000,000 (or its equivalent in the relevant currency of payment) (provided, that if at any time the threshold for Debt which may trigger a cross default, cross acceleration or similar provision under the Primary Credit Facility at such time is greater than $50,000,000, the threshold for Debt which may trigger an Event of Default under this clause shall be such greater amount for so long as such greater amount shall remain in effect under such Primary Credit Facility, provided, further, however that, notwithstanding the terms of the Primary Credit Facility, in no event shall the threshold for Debt which may trigger an Event of Default under this clause be greater than $125,000,000), or (y) one or more Persons have the right to require the Company, the General Partner or any Material Subsidiary so to purchase or repay such Debt; or
(g)    the Company, the General Partner or any Material Subsidiary (i) is generally not paying, or admits in writing its inability to pay, its debts as they become due, (ii) files, or consents by answer or otherwise to the filing against it of, a petition for relief or reorganization or arrangement or any other petition in bankruptcy, for liquidation or to take advantage of any bankruptcy, insolvency, reorganization, moratorium or other similar law of any jurisdiction, (iii) makes an assignment for the benefit of its creditors, (iv) consents to the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, (v) is adjudicated as insolvent or to be liquidated, or (vi) takes corporate action for the purpose of any of the foregoing; or
(h)    a court or other Governmental Authority of competent jurisdiction enters an order appointing, without consent by the Company, the General Partner or any Material Subsidiary, a custodian, receiver, trustee or other officer with similar powers with respect to it or with respect to any substantial part of its property, or constituting an order for relief or approving a petition for relief or reorganization or any other petition in bankruptcy or for liquidation or to take advantage of any bankruptcy or insolvency law of any jurisdiction, or ordering the dissolution, winding‐up or liquidation the Company, the General Partner or any Material Subsidiary, or any such petition shall be filed against the Company, the General Partner or any Material Subsidiary and such petition shall not be dismissed within 60 days; or
(i)    any event occurs with respect to the Company, the General Partner or any Material Subsidiary which under the laws of any jurisdiction is analogous to any of the 

34

events described in Section 11(g) or Section 11(h), provided that the applicable grace period, if any, which shall apply shall be the one applicable to the relevant proceeding which most closely corresponds to the proceeding described in Section 11(g) or Section 11(h); or
(j)    one or more final judgments or orders for the payment of money (other than any judgment as to which, and only to the extent, a reputable insurance company has acknowledged coverage of such claim in writing) aggregating in excess of $10,000,000 (or its equivalent in the relevant currency of payment) (provided, that if at any time the threshold for a judgement which may trigger a judgement default or similar provision under the Primary Credit Facility at such time is greater than $10,000,000, the threshold for a judgement which may trigger an Event of Default under this clause shall be such greater amount for so long as such greater amount shall remain in effect under such Primary Credit Facility), including any such final order enforcing a binding arbitration decision, are rendered against one or more of the Company, the General Partner or any Material Subsidiary and which judgments are not, within 60 days after entry thereof, bonded, discharged, paid, vacated or stayed pending appeal, or are not bonded, vacated, satisfied or discharged within 60 days after the expiration of such stay; or
(k)    if (i) any Pension Plan shall fail to satisfy the minimum funding standards of ERISA or the Code for any plan year or part thereof or a waiver of such standards or extension of any amortization period is sought or granted under section 412 of the Code, (ii) a notice of intent to terminate any Pension Plan shall have been or is reasonably expected to be filed with the PBGC or the PBGC shall have instituted proceedings under ERISA section 4042 to terminate or appoint a trustee to administer any Plan or the PBGC shall have notified the Company or any ERISA Affiliate that a Pension Plan will become a subject of any such proceedings, (iii) there is any “amount of unfunded benefit liabilities” (within the meaning of section 4001(a)(18) of ERISA) under one or more Pension Plans, determined in accordance with Title IV of ERISA, (iv) the aggregate present value of accrued benefit liabilities under all funded Non‐U.S. Plans exceeds the aggregate current value of the assets of such Non‐U.S. Plans allocable to such liabilities, (v) the Company or any ERISA Affiliate shall have incurred or is reasonably expected to incur any liability pursuant to Title I or IV of ERISA or the penalty or excise tax provisions of the Code relating to employee pension benefit plans, (vi) the Company or any ERISA Affiliate withdraws from any Multiemployer Plan, (vii) the Company or any Subsidiary establishes or amends any employee welfare benefit plan that provides post‐employment welfare benefits in a manner that would increase the liability of the Company or any Subsidiary thereunder, (viii) the Company or any Subsidiary fails to administer or maintain a Non‐U.S. Plan in compliance with the requirements of any and all applicable laws, statutes, rules, regulations or court orders or any Non‐U.S. Plan is involuntarily terminated or wound up, or (ix) the Company or any Subsidiary becomes subject to the imposition of a financial penalty (which for this purpose shall mean any tax, penalty or other liability, whether by way of indemnity or otherwise) with respect to one or more Non‐U.S. Plans during a plan year in which it was a substantial employer (within the meaning of Section 4001(a)(2) or 4062(e) of ERISA); and any such event or events described in clauses (i) through (ix) above, either individually or together with any 

35

other such event or events, could reasonably be expected to have a Material Adverse Effect.  As used in this Section 11(k), the terms “employee pension benefit plan” and “employee welfare benefit plan” shall have the meanings assigned to such terms in section 3 of ERISA; or
(l)    the General Partner shall fail at any time to remain qualified as a REIT; or
(m)    any Note Guaranty shall cease to be in full force and effect (except as permitted by Section 9.7(b)), any Note Guarantor or any Person acting on behalf of any Note Guarantor shall contest in any manner in writing the validity, binding nature or enforceability of any Note Guaranty, or the obligations of any Note Guarantor under any Note Guaranty are not or cease to be legal, valid, binding and enforceable in accordance with the terms of such Note Guaranty (except as permitted by Section 9.7(b)).
		
	Section 12.
	Remedies on Default, Etc.

Section 12.1.    Acceleration.  (a) If an Event of Default with respect to the Company described in Section 11(g), (h) or (i) (other than an Event of Default described in clause (i) of Section 11(g) or described in clause (vi) of Section 11(g) by virtue of the fact that such clause encompasses clause (i) of Section 11(g)) has occurred, all the Notes then outstanding shall automatically become immediately due and payable.
(b)    If any other Event of Default has occurred and is continuing, the Required Holders may at any time at its or their option, by notice or notices to the Company, declare all the Notes then outstanding to be immediately due and payable.
(c)    If any Event of Default described in Section 11(a) or (b) has occurred and is continuing, any holder or holders of Notes at the time outstanding affected by such Event of Default may at any time, at its or their option, by notice or notices to the Company, declare all the Notes held by it or them to be immediately due and payable.
Upon any Notes becoming due and payable under this Section 12.1, whether automatically or by declaration, such Notes will forthwith mature and the entire unpaid principal amount of such Notes, plus (x) all accrued and unpaid interest thereon (including interest accrued thereon at the Default Rate) and (y) the Make‐Whole Amount determined in respect of such principal amount, shall all be immediately due and payable, in each and every case without presentment, demand, protest or further notice, all of which are hereby waived.  The Company acknowledges, and the parties hereto agree, that each holder of a Note has the right to maintain its investment in the Notes free from repayment by the Company (except as herein specifically provided for) and that the provision for payment of a Make‐Whole Amount by the Company in the event that the Notes are prepaid or are accelerated as a result of an Event of Default, is intended to provide compensation for the deprivation of such right under such circumstances.
Section 12.2.    Other Remedies.  If any Default or Event of Default has occurred and is continuing, and irrespective of whether any Notes have become or have been declared immediately due and payable under Section 12.1, the holder of any Note at the time outstanding 

36

may proceed to protect and enforce the rights of such holder by an action at law, suit in equity or other appropriate proceeding, whether for the specific performance of any agreement contained herein or in any Note or Note Guaranty, or for an injunction against a violation of any of the terms hereof or thereof, or in aid of the exercise of any power granted hereby or thereby or by law or otherwise.
Section 12.3.    Rescission.  At any time after any Notes have been declared due and payable pursuant to Section 12.1(b) or (c), the Required Holders, by written notice to the Company, may rescind and annul any such declaration and its consequences if (a) the Company has paid all overdue interest on the Notes, all principal of and Make‐Whole Amount, if any, on any Notes that are due and payable and are unpaid other than by reason of such declaration, and all interest on such overdue principal and Make‐Whole Amount, if any, and (to the extent permitted by applicable law) any overdue interest in respect of the Notes, at the Default Rate for the applicable series, (b) neither the Company nor any other Person shall have paid any amounts which have become due solely by reason of such declaration, (c) all Events of Default and Defaults, other than non‐payment of amounts that have become due solely by reason of such declaration, have been cured or have been waived pursuant to Section 17, and (d) no judgment or decree has been entered for the payment of any monies due pursuant hereto or to the Notes.  No rescission and annulment under this Section 12.3 will extend to or affect any subsequent Event of Default or Default or impair any right consequent thereon.
Section 12.4.    No Waivers or Election of Remedies, Expenses, Etc.  No course of dealing and no delay on the part of any holder of any Note in exercising any right, power or remedy shall operate as a waiver thereof or otherwise prejudice such holder’s rights, powers or remedies.  No right, power or remedy conferred by this Agreement, any Note Guaranty or any Note upon any holder thereof shall be exclusive of any other right, power or remedy referred to herein or therein or now or hereafter available at law, in equity, by statute or otherwise.  Without limiting the obligations of the Company under Section 15, the Company will pay to the holder of each Note on demand such further amount as shall be sufficient to cover all reasonable and documented costs and expenses of such holder incurred in any enforcement or collection under this Section 12, including reasonable and documented attorneys’ fees, expenses and disbursements.
		
	Section 13.
	Registration; Exchange; Substitution of Notes.

Section 13.1.    Registration of Notes.  The Company shall keep at its principal executive office a register for the registration and registration of transfers of Notes.  The name and address of each holder of one or more Notes, each transfer thereof and the name and address of each transferee of one or more Notes shall be registered in such register.  If any holder of one or more Notes is a nominee, then (a) the name and address of the beneficial owner of such Note or Notes shall also be registered in such register as an owner and holder thereof and (b) at any such beneficial owner’s option, either such beneficial owner or its nominee may execute any amendment, waiver or consent pursuant to this Agreement.  Prior to due presentment for registration of transfer, the Person in whose name any Note shall be registered shall be deemed and treated as the owner and holder thereof for all purposes hereof, and the Company shall not be affected by any notice or knowledge to the contrary.  The Company shall give to any holder of a 

37

Note that is an Institutional Investor promptly upon request therefor, a complete and correct copy of the names and addresses of all registered holders of Notes.
Section 13.2.    Transfer and Exchange of Notes.  Upon surrender of any Note to the Company at the address and to the attention of the designated officer (all as specified in Section 18(iii)), for registration of transfer or exchange (and in the case of a surrender for registration of transfer accompanied by a written instrument of transfer duly executed by the registered holder of such Note or such holder’s attorney duly authorized in writing and accompanied by the relevant name, address and other information for notices of each transferee of such Note or part thereof), within 10 Business Days thereafter, the Company shall execute and deliver, at the Company’s expense (except as provided below), one or more new Notes of the same series (as requested by the holder thereof) in exchange therefor, in an aggregate principal amount equal to the unpaid principal amount of the surrendered Note.  Each such new Note shall be payable to such Person as such holder may request and shall be substantially in the form of Schedule 1‐A or Schedule 1‐B, as applicable.  Each such new Note shall be dated and bear interest from the date to which interest shall have been paid on the surrendered Note or dated the date of the surrendered Note if no interest shall have been paid thereon.  The Company may require payment of a sum sufficient to cover any stamp tax or governmental charge imposed in respect of any such transfer of Notes.  Notes shall not be transferred in denominations of less than $100,000, provided that if necessary to enable the registration of transfer by a holder of its entire holding of Notes of a series, one Note of such series may be in a denomination of less than $100,000.  Any transferee, by its acceptance of a Note registered in its name (or the name of its nominee), shall be deemed to have made the representation set forth in Section 6.2.
Section 13.3.    Replacement of Notes.  Upon receipt by the Company at the address and to the attention of the designated officer (all as specified in Section 18(iii)) of evidence reasonably satisfactory to it of the ownership of and the loss, theft, destruction or mutilation of any Note (which evidence shall be, in the case of an Institutional Investor, notice from such Institutional Investor of such ownership and such loss, theft, destruction or mutilation), and
(a)    in the case of loss, theft or destruction, of indemnity reasonably satisfactory to it (provided that if the holder of such Note is, or is a nominee for, an original Purchaser or another holder of a Note with a minimum net worth of at least $50,000,000 or a Qualified Institutional Buyer, such Person’s own unsecured agreement of indemnity shall be deemed to be satisfactory), or
(b)    in the case of mutilation, upon surrender and cancellation thereof,
within 10 Business Days thereafter, the Company at its own expense shall execute and deliver, in lieu thereof, a new Note of the same series, dated and bearing interest from the date to which interest shall have been paid on such lost, stolen, destroyed or mutilated Note or dated the date of such lost, stolen, destroyed or mutilated Note if no interest shall have been paid thereon.

38

		
	Section 14.
	Payments on Notes.

Section 14.1.    Place of Payment.  Subject to Section 14.2, payments of principal, Make‐Whole Amount, if any, and interest becoming due and payable on the Notes shall be made in New York, New York at the principal office of JPMorgan Chase Bank, N.A. in such jurisdiction.  The Company may at any time, by notice to each holder of a Note, change the place of payment of the Notes so long as such place of payment shall be either the principal office of the Company in such jurisdiction or the principal office of a bank or trust company in such jurisdiction.
Section 14.2.    Payment by Wire Transfer.  So long as any Purchaser or its nominee shall be the holder of any Note, and notwithstanding anything contained in Section 14.1 or in such Note to the contrary, the Company will pay all sums becoming due on such Note for principal, Make‐Whole Amount, if any, interest and all other amounts becoming due hereunder by the method and at the address specified for such purpose below such Purchaser’s name in the Purchaser Schedule, or by such other method or at such other address as such Purchaser shall have from time to time specified to the Company in writing for such purpose, without the presentation or surrender of such Note or the making of any notation thereon, except that upon written request of the Company made concurrently with or reasonably promptly after payment or prepayment in full of any Note, such Purchaser shall surrender such Note for cancellation, reasonably promptly after any such request, to the Company at its principal executive office or at the place of payment most recently designated by the Company pursuant to Section 14.1.  Prior to any sale or other disposition of any Note held by a Purchaser or its nominee, such Purchaser will, at its election, either endorse thereon the amount of principal paid thereon and the last date to which interest has been paid thereon or surrender such Note to the Company in exchange for a new Note or Notes pursuant to Section 13.2.  The Company will afford the benefits of this Section 14.2 to any Institutional Investor that is the direct or indirect transferee of any Note purchased by a Purchaser under this Agreement and that has made the same agreement relating to such Note as the Purchasers have made in this Section 14.2.
Section 14.3.    FATCA Information.  By acceptance of any Note, the holder of such Note agrees that such holder will with reasonable promptness duly complete and deliver to the Company, or to such other Person as may be reasonably requested by the Company, from time to time (a) in the case of any such holder that is a United States Person, such holder’s United States tax identification number or other Forms reasonably requested by the Company necessary to establish such holder’s status as a United States Person under FATCA and as may otherwise be necessary for the Company to comply with its obligations under FATCA and (b) in the case of any such holder that is not a United States Person, such documentation prescribed by applicable law (including as prescribed by section 1471(b)(3)(C)(i) of the Code) and such additional documentation as may be necessary for the Company to comply with its obligations under FATCA and to determine that such holder has complied with such holder’s obligations under FATCA or to determine the amount (if any) to deduct and withhold from any such payment made to such holder.  Nothing in this Section 14.3 shall require any holder to provide information that is confidential or proprietary to such holder unless the Company is required to obtain such information under FATCA and, in such event, the Company shall treat any such information it receives as confidential.

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	Section 15.
	Expenses, Etc.

Section 15.1.    Transaction Expenses.  Whether or not the transactions contemplated hereby are consummated, the Company will pay all reasonable and documented costs and expenses (including reasonable and documented attorneys’ fees of one special counsel for the Purchasers and holders, taken as a whole, and, if reasonably required by the Required Holders, one local counsel in each applicable jurisdiction and/or one specialty counsel in each applicable specialty, for Purchasers and holders, taken as a whole) incurred by the Purchasers and each other holder of a Note in connection with the execution of this Agreement, the Notes and the Note Guaranties on the date hereof and in connection with any amendments, waivers or consents under or in respect of this Agreement, any Note Guaranty or the Notes (whether or not such amendment, waiver or consent becomes effective), including: (a) the costs and expenses incurred in enforcing or defending (or determining whether or how to enforce or defend) any rights under this Agreement, any Note Guaranty or the Notes or in responding to any subpoena or other legal process or informal investigative demand issued in connection with this Agreement, any Note Guaranty or the Notes, or by reason of being a holder of any Note, (b) the costs and expenses, including fees of one financial advisor for the Purchasers and the holders, taken as a whole, incurred in connection with the insolvency or bankruptcy of the General Partner, the Company or any Subsidiary or in connection with any work‐out or restructuring of the transactions contemplated hereby and by the Notes and any Note Guaranty and (c) the costs and expenses incurred in connection with the initial filing of this Agreement and all related documents and financial information with the SVO; provided, that such costs and expenses under this clause (c) shall not exceed $3,500 per series.  If required by the NAIC, the Company shall obtain and maintain at its own cost and expense a Legal Entity Identifier (LEI).  
The Company will pay, and will save each Purchaser and each other holder of a Note harmless from, (i) all claims in respect of any fees, costs or expenses, if any, of brokers and finders (other than those, if any, retained by a Purchaser or other holder in connection with its purchase of the Notes), (ii) any and all wire transfer fees that any bank or other financial institution deducts from any payment under such Note to such holder or otherwise charges to a holder of a Note with respect to a payment under such Note and (iii) any judgment, liability, claim, order, decree, fine, penalty, cost, fee, expense (including reasonable attorneys’ fees and expenses) or obligation resulting from the consummation of the transactions contemplated hereby, including the use of the proceeds of the Notes by the Company; provided, that the Company shall have no obligation under this clause (iii) to the extent such obligation has resulted from (x) the gross negligence or willful misconduct of a Purchaser or (y) the material breach in bad faith of such Purchaser’s obligations hereunder.
Section 15.2.    Certain Taxes.  The Company agrees to pay all stamp, documentary or similar taxes or fees which may be payable in respect of the execution and delivery or the enforcement of this Agreement or any Note Guaranty or the execution and delivery (but not the transfer) or the enforcement of any of the Notes in the United States or any other jurisdiction where the Company or any Note Guarantor has assets or of any amendment of, or waiver or consent under or with respect to, this Agreement or any Note Guaranty or of any of the Notes, and to pay any value added tax due and payable in respect of reimbursement of costs and expenses by the Company pursuant to this Section 15, and will save each holder of a Note to the 

40

extent permitted by applicable law harmless against any loss or liability resulting from nonpayment or delay in payment of any such tax or fee required to be paid by the Company hereunder.
Section 15.3.    Survival.  The obligations of the Company under this Section 15 will survive the payment or transfer of any Note, the enforcement, amendment or waiver of any provision of this Agreement, any Note Guaranty or the Notes, and the termination of this Agreement.
Section 16.    Survival of Representations and Warranties; Entire Agreement.
All representations and warranties contained herein shall survive the execution and delivery of this Agreement and the Notes, the purchase or transfer by any Purchaser of any Note or portion thereof or interest therein and the payment of any Note, and may be relied upon by any subsequent holder of a Note, regardless of any investigation made at any time by or on behalf of such Purchaser or any other holder of a Note.  All statements contained in any certificate or other instrument delivered by or on behalf of the Company pursuant to this Agreement shall be deemed representations and warranties of the Company under this Agreement.  Subject to the preceding sentence, this Agreement, the Notes and any Note Guaranties embody the entire agreement and understanding between each Purchaser and the Company and supersede all prior agreements and understandings relating to the subject matter hereof.
		
	Section 17.
	Amendment and Waiver.

Section 17.1.    Requirements.  This Agreement and the Notes may be amended, and the observance of any term hereof or of the Notes may be waived (either retroactively or prospectively), only with the written consent of the Company and the Required Holders, except that:
(a)    no amendment or waiver of any of Sections 1, 2, 3, 4, 5, 6 or 21 hereof, or any defined term (as it is used therein), will be effective as to any Purchaser unless consented to by such Purchaser in writing; and
(b)     no amendment or waiver may, without the written consent of each Purchaser and the holder of each Note at the time outstanding, (i) subject to Section 12 relating to acceleration or rescission, change the amount or time of any prepayment or payment of principal of, or reduce the rate or change the time of payment or method of computation of (x) interest on the Notes or (y) the Make‐Whole Amount, (ii) change the percentage of the principal amount of the Notes the holders of which are required to consent to any amendment or waiver or the principal amount of the Notes that the Purchasers are to purchase pursuant to Section 2 upon the satisfaction of the conditions to Closing that appear in Section 4, or (iii) amend any of Sections 8 (except as set forth in the second sentence of Section 8.2), 11(a), 11(b), 12, 17 or 20.

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Section 17.2.    Solicitation of Holders of Notes.
(a)    Solicitation.  The Company will provide each Purchaser and each holder of a Note with sufficient information, sufficiently far in advance of the date a decision is required, to enable such Purchaser or such holder to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof or of the Notes or any Note Guaranty.  The Company will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to this Section 17 or any Note Guaranty to each holder of a Note promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite Purchasers and holders of Notes.
(b)    Payment.  The Company will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security or provide other credit support, to any Purchaser or any holder of a Note as consideration for or as an inducement to the entering into by such holder of any waiver or amendment of any of the terms and provisions hereof or of any Note Guaranty or any Note unless such remuneration is concurrently paid, or security is concurrently granted or other credit support concurrently provided, on the same terms, ratably to each Purchaser and each holder of a Note even if such holder did not consent to such waiver or amendment.
(c)    Consent in Contemplation of Transfer.  Any consent given pursuant to this Section 17 or any Note Guaranty by a Purchaser or holder of a Note that has transferred or has agreed to transfer its Note to (i) the Company, (ii) any Subsidiary or any other Affiliate of the Company or (iii) any other Person in connection with, or in anticipation of, such other Person acquiring, making a tender offer for or merging with the Company and/or any of its Affiliates, in each case in connection with such consent, shall be void and of no force or effect except solely as to such Purchaser or such holder, and any amendments effected or waivers granted or to be effected or granted that would not have been or would not be so effected or granted but for such consent (and the consents of all other holders of Notes that were acquired under the same or similar conditions) shall be void and of no force or effect except solely as to such Purchaser or such holder.
Section 17.3.    Binding Effect, Etc.  Any amendment or waiver consented to as provided in this Section 17 or any Note Guaranty applies equally to all Purchasers and holders of Notes and is binding upon them and upon each future holder of any Note and upon the Company without regard to whether such Note has been marked to indicate such amendment or waiver.  No such amendment or waiver will extend to or affect any obligation, covenant, agreement, Default or Event of Default not expressly amended or waived or impair any right consequent thereon.  No course of dealing between the Company and any Purchaser or any holder of a Note and no delay in exercising any rights hereunder or under any Note or Note Guaranty shall operate as a waiver of any rights of any Purchaser or any holder of such Note.
Section 17.4.    Notes Held by Company, Etc.  Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver or consent to be given under this Agreement, any Note Guaranty or the Notes, or have directed the taking of any action provided 

42

herein or in any Note Guaranty or the Notes to be taken upon the direction of the holders of a specified percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by the Company or any of its Affiliates shall be deemed not to be outstanding.
		
	Section 18.
	Notices.

Except to the extent otherwise provided in Section 7.4, all notices and communications provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day sends a confirming copy of such notice by an internationally recognized overnight delivery service (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by an internationally recognized overnight delivery service (charges prepaid).  Any such notice must be sent:
(i)    if to any Purchaser or its nominee, to such Purchaser or nominee at the address specified for such communications in the Purchaser Schedule, or at such other address as such Purchaser or nominee shall have specified to the Company in writing,
(ii)    if to any other holder of any Note, to such holder at such address as such other holder shall have specified to the Company in writing, or
(iii)    if to the Company, to the Company at its address set forth at the beginning hereof to the attention of the Chief Financial Officer and the Treasurer, or at such other address as the Company shall have specified to the holder of each Note in writing.
Notices under this Section 18 will be deemed given only when actually received.
		
	Section 19.
	Reproduction of Documents.

This Agreement and all documents relating thereto, including (a) consents, waivers and modifications that may hereafter be executed, (b) documents received by any Purchaser at the Closing (except the Notes themselves), and (c) financial statements, certificates and other information previously or hereafter furnished to any Purchaser, may be reproduced by such Purchaser by any photographic, photostatic, electronic, digital, or other similar process and such Purchaser may destroy any original document so reproduced.  The Company agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by such Purchaser in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.  This Section 19 shall not prohibit the Company or any other holder of Notes from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.

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	Section 20.
	Confidential Information.

For the purposes of this Section 20, “Confidential Information” means information delivered to any Purchaser by or on behalf of the General Partner, the Company or any Subsidiary in connection with the transactions contemplated by or otherwise pursuant to this Agreement that is proprietary in nature and that was clearly marked or labeled or otherwise adequately identified when received by such Purchaser as being confidential information of the General Partner, the Company or such Subsidiary, provided that such term does not include information that (a) was publicly known or otherwise known to such Purchaser prior to the time of such disclosure, (b) subsequently becomes publicly known through no act or omission by such Purchaser or any Person acting on such Purchaser’s behalf, (c) otherwise becomes known to such Purchaser other than through disclosure by the General Partner, the Company or any Subsidiary or (d) constitutes financial statements delivered to such Purchaser under Section 7.1 that are otherwise publicly available.  Each Purchaser will maintain the confidentiality of such Confidential Information in accordance with procedures adopted by such Purchaser in good faith to protect confidential information of third parties delivered to such Purchaser, provided that such Purchaser may deliver or disclose Confidential Information to (i) its directors, officers, employees, agents, attorneys, trustees and affiliates (to the extent such disclosure reasonably relates to the administration of the investment represented by its Notes and such recipient is notified of its obligation to maintain the confidentiality of such information), (ii) its auditors, financial advisors and other professional advisors who agree to hold confidential the Confidential Information substantially in accordance with this Section 20, (iii) any other holder of any Note, (iv) any Institutional Investor to which it sells or offers to sell such Note or any part thereof or any participation therein (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by this Section 20), (v) any Person from which it offers to purchase any Security of the Company (if such Person has agreed in writing prior to its receipt of such Confidential Information to be bound by this Section 20), (vi) any federal or state regulatory authority having jurisdiction over such Purchaser, (vii) the NAIC or the SVO or, in each case, any similar organization, or any nationally recognized rating agency that requires access to information about such Purchaser’s investment portfolio, or (viii) any other Person to which such delivery or disclosure may be necessary or appropriate (w) to effect compliance with any law, rule, regulation or order applicable to such Purchaser (provided that, unless specifically prohibited by applicable law, rule, regulation or order, such Purchaser shall use its best efforts to notify the Company prior to disclosure), (x) in response to any subpoena or other legal process (provided that, unless specifically prohibited by applicable law, rule, regulation or order, such Purchaser shall use its best efforts to notify the Company prior to disclosure), (y) in connection with any litigation to which such Purchaser is a party (provided that, unless specifically prohibited by applicable law, rule, regulation or order, such Purchaser shall use its best efforts to notify the Company prior to disclosure) or (z) if an Event of Default has occurred and is continuing, to the extent such Purchaser may reasonably determine such delivery and disclosure to be necessary or appropriate in the enforcement or for the protection of the rights and remedies under such Purchaser’s Notes, this Agreement or any Note Guaranty.  Each holder of a Note, by its acceptance of a Note, will be deemed to have agreed to be bound by and to be entitled to the benefits of this Section 20 as though it were a party to this Agreement.  On reasonable request by the Company in connection with the delivery to any holder of a Note of information required to be delivered to such holder under this Agreement or requested by such holder (other than a 

44

holder that is a party to this Agreement or its nominee), such holder will enter into an agreement with the Company embodying this Section 20.
In the event that as a condition to receiving access to information relating to the General Partner, the Company or its Subsidiaries in connection with the transactions contemplated by or otherwise pursuant to this Agreement, any Purchaser or holder of a Note is required to agree to a confidentiality undertaking (whether through IntraLinks, another secure website, a secure virtual workspace or otherwise) which is different from this Section 20, this Section 20 shall not be amended thereby and, as between such Purchaser or such holder and the Company, this Section 20 shall supersede any such other confidentiality undertaking.
Section 21.    Substitution of Purchaser.
Each Purchaser shall have the right to substitute any one of its Affiliates or another Purchaser or any one of such other Purchaser’s Affiliates (a “Substitute Purchaser”) as the purchaser of the Notes that it has agreed to purchase hereunder, by written notice to the Company, which notice shall be signed by both such Purchaser and such Substitute Purchaser, shall contain such Substitute Purchaser’s agreement to be bound by this Agreement and shall contain a confirmation by such Substitute Purchaser of the accuracy with respect to it of the representations set forth in Section 6.  Upon receipt of such notice, any reference to such Purchaser in this Agreement (other than in this Section 21), shall be deemed to refer to such Substitute Purchaser in lieu of such original Purchaser.  In the event that such Substitute Purchaser is so substituted as a Purchaser hereunder and such Substitute Purchaser thereafter transfers to such original Purchaser all of the Notes then held by such Substitute Purchaser, upon receipt by the Company of notice of such transfer, any reference to such Substitute Purchaser as a “Purchaser” in this Agreement (other than in this Section 21), shall no longer be deemed to refer to such Substitute Purchaser, but shall refer to such original Purchaser, and such original Purchaser shall again have all the rights of an original holder of the Notes under this Agreement.
		
	Section 22.
	Miscellaneous.

Section 22.1.    Successors and Assigns.  All covenants and other agreements contained in this Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns (including any subsequent holder of a Note) whether so expressed or not, except that, except pursuant to a transaction permitted by Section 10.2, the Company may not assign or otherwise transfer any of its rights or obligations hereunder or under the Notes without the prior written consent of each holder.  Nothing in this Agreement, expressed or implied, shall be construed to confer upon any Person (other than the parties hereto and their respective successors and assigns permitted hereby) any legal or equitable right, remedy or claim under or by reason of this Agreement.
Section 22.2.    Accounting Terms.  (a) All accounting terms used herein which are not expressly defined in this Agreement have the meanings respectively given to them in accordance with GAAP.  Except as otherwise specifically provided herein, (i) all computations made pursuant to this Agreement shall be made in accordance with GAAP, and (ii) all financial statements shall be prepared in accordance with GAAP.  For purposes of determining 

45

compliance with this Agreement (including Section 9, Section 10 and the definition of “Debt”), any election by the Company to measure any financial liability using fair value (as permitted by Financial Accounting Standards Board Accounting Standards Codification Topic No. 825‐10‐25 - Fair Value Option, International Accounting Standard 39 - Financial Instruments: Recognition and Measurement or any similar accounting standard) shall be disregarded and such determination shall be made as if such election had not been made.
(b)    If the Company notifies the holders of the Notes that the Company wishes to amend any covenant in Section 10 to eliminate the effect of any change in GAAP on the operation of such covenant (or if the Required Holders notify the Company that the Required Holders wish to amend Section 10 for such purpose), then the Company’s compliance with such covenant shall be determined on the basis of GAAP in effect immediately before the relevant change in GAAP became effective, until either such notice is withdrawn or such covenant is amended in a manner satisfactory to the Company and the Required Holders.
Section 22.3.    Severability.  Any provision of this Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law) not invalidate or render unenforceable such provision in any other jurisdiction.
Section 22.4.    Construction, Etc.  Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such an express contrary provision) be deemed to excuse compliance with any other covenant.  Where any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.
Defined terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  The word “or” shall not be exclusive. Unless the context requires otherwise (a) any definition of or reference to any agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein) and, for purposes of the Notes, shall also include any such notes issued in substitution therefor pursuant to Section 13, (b) subject to Section 22.1, any reference herein to any Person shall be construed to include such Person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Sections and Schedules shall be construed to refer to Sections of, and Schedules to, this Agreement, and (e) any reference to any law or regulation herein shall, unless otherwise 

46

specified, refer to such law or regulation as amended, modified or supplemented from time to time.
Section 22.5.    Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be an original but all of which together shall constitute one instrument.  Each counterpart may consist of a number of copies hereof, each signed by less than all, but together signed by all, of the parties hereto.
Section 22.6.    Governing Law.  This Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York excluding choice‐of‐law principles of the law of such State that would permit the application of the law of a jurisdiction other than such State.
Section 22.7.    Jurisdiction and Process; Waiver of Jury Trial.  (a) The Company irrevocably submits to the non‐exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan, The City of New York, over any suit, action or proceeding arising out of or relating to this Agreement or the Notes.  To the fullest extent permitted by applicable law, the Company irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.
(b)    The Company agrees, to the fullest extent permitted by applicable law, that a final judgment in any suit, action or proceeding of the nature referred to in Section 22.7(a) brought in any such court shall be conclusive and binding upon it subject to rights of appeal, as the case may be, and may be enforced in the courts of the United States of America or the State of New York (or any other courts to the jurisdiction of which it or any of its assets is or may be subject) by a suit upon such judgment.
(c)    The Company consents to process being served by or on behalf of any holder of Notes in any suit, action or proceeding of the nature referred to in Section 22.7(a) by mailing a copy thereof by registered, certified, priority or express mail (or any substantially similar form of mail), postage prepaid, return receipt or delivery confirmation requested, to it at its address specified in Section 18 or at such other address of which such holder shall then have been notified pursuant to said Section.  The Company agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and (ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it.  Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.
(d)    Nothing in this Section 22.7 shall affect the right of any holder of a Note to serve process in any manner permitted by law, or limit any right that the holders of any of the Notes may have to bring proceedings against the Company in the courts of any appropriate jurisdiction 

47

or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.
(e)    THE PARTIES HERETO HEREBY WAIVE TRIAL BY JURY IN ANY ACTION BROUGHT ON OR WITH RESPECT TO THIS AGREEMENT, THE NOTES OR ANY OTHER DOCUMENT EXECUTED IN CONNECTION HEREWITH OR THEREWITH. 

*    *    *    *    *

48

If you are in agreement with the foregoing, please sign the form of agreement on a counterpart of this Agreement and return it to the Company, whereupon this Agreement shall become a binding agreement between you and the Company.

	
						
	 
	 
	Very truly yours,
	 

	 
	 
	 
	 
	 
	 

	 
	 
	Kilroy Realty, L.P., a Delaware limited partnership
	 

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	By:
	 
	Kilroy Realty Corporation, a

	 
	 
	 
	 
	Maryland corporation, its general partner
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Tyler H. Rose
	 

	 
	 
	 
	 
	Tyler H. Rose
Executive Vice President, 
and Chief Financial Officer
	 

	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Michelle Ngo
	 

	 
	 
	 
	 
	Michelle Ngo
Senior Vice President
and Treasurer
	 

49

This Agreement is hereby
accepted and agreed to as 
of the date hereof.

	
						
	 
	 
	NEW YORK LIFE INSURANCE COMPANY
	 

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Aron Davidowitz
	 

	 
	 
	 
	 
	Name:  Aron Davidowitz
Title:   Corporate Vice President

	 

	 
	 
	 
	 
	 
	 

	 
	 
	NEW YORK LIFE INSURANCE AND ANNUITY
CORPORATION
	 

	 
	 
	By:
	 
	NYL Investors LLC
Its Investment Manager
	 

	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Aron Davidowitz
	 

	 
	 
	 
	 
	Name:  Aron Davidowitz
Title:    Senior Director

	 

	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	THE BANK OF NEW YORK MELLON, A BANKING CORPORATION ORGANIZED UNDER THE LAWS OF NEW YORK, NOT IN ITS INDIVIDUAL CAPACITY BUT SOLELY AS TRUSTEE UNDER THAT CERTAIN TRUST AGREEMENT DATED AS OF JULY 1ST, 2015 BETWEEN NEW YORK LIFE INSURANCE COMPANY, AS GRANTOR, JOHN HANCOCK LIFE INSURANCE COMPANY (U.S.A.), AS BENEFICIARY, JOHN HANCOCK LIFE INSURANCE COMPANY OF NEW YORK, AS BENEFICIARY, AND THE BANK OF NEW YORK MELLON, AS TRUSTEE.
	 

	 
	 
	By:
	 
	New York Life Insurance Company
its attorney-in-fact
	 

	 
	 
	 
	 
	 
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Aron Davidowitz
	 

	 
	 
	 
	 
	Name:  Aron Davidowitz
Title:    Corporate Vice President

	 

50

This Agreement is hereby
accepted and agreed to as 
of the date hereof.

	
					
	 
	 
	AXA EQUITABLE LIFE INSURANCE COMPANY

	 
	 
	 

	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Amy Judd

	 
	 
	 
	 
	Name:  Amy Judd
Title:    Investment Officer 

51

    
This Agreement is hereby
accepted and agreed to as 
of the date hereof.
    

	
					
	 
	 
	AB US DIVERSIFIED CREDIT BM FUND

	 
	 
	By:
	 
	AllianceBernstein LP,
Its Investment Advisor

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Amy Judd

	 
	 
	 
	 
	Name:  Amy Judd
Title:    Senior Vice President 

    

52

This Agreement is hereby
accepted and agreed to as 
of the date hereof.

	
					
	 
	 
	TRIVENT FINANCIAL FOR LUTHERANS

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Martin Rosacker

	 
	 
	 
	 
	Name:  Martin Rosacker
Title:    Managing Director 

53

This Agreement is hereby
accepted and agreed to as 
of the date hereof.

	
					
	 
	 
	AMERICAN EQUITY INVESTMENT LIFE INSURANCE 
COMPANY

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Jeffrey A. Fossell

	 
	 
	 
	 
	Name:  Jeffrey A. Fossell
Title:    Authorized Signatory

54

This Agreement is hereby
accepted and agreed to as 
of the date hereof.

	
					
	 
	 
	GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	By: 
	 
	/s/ Eve Hampton

	 
	 
	 
	 
	Name:  Eve Hampton
Title:     Vice President, Investments

	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Janet Hurkett

	 
	 
	 
	 
	Name:  Janet Hurkett
Title:     Manager, Investments

	
					
	 
	 
	GREAT-WEST LIFE & ANNUITY INSURANCE COMPANY
OF NEW YORK

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	By: 
	 
	/s/ Eve Hampton

	 
	 
	 
	 
	Name:  Eve Hampton
Title:     Vice President, Investments

	 
	 
	 
	 
	 

	 
	 
	By:
	 
	/s/ Janet Hurkett

	 
	 
	 
	 
	Name:  Janet Hurkett
Title:     Manager, Investments

55

Defined Terms
As used herein, the following terms have the respective meanings set forth below or set forth in the Section hereof following such term:
“Acquisition Property” means, as of any date of determination, any Real Property Assets acquired within such fiscal quarter and/or the immediately preceding three fiscal quarters.
“Adjusted Annual EBITDA” means, for any period, Annual EBITDA for such period, minus the sum of (a) interest income other than interest income from mortgage notes not in excess of $5,000,000 per annum (provided, that if at any time such threshold under the Primary Credit Facility at such time is greater or less than $5,000,000, the threshold under this definition shall be such greater or lesser amount, as the case may be, for so long as such greater or lesser amount shall remain in effect under such Primary Credit Facility), and (b) a management fee reserve in an amount equal to 3% of consolidated total revenue (after deduction of interest income of the Company and its subsidiaries for such period), plus the sum of (a) general and administrative expenses for such period to the extent included in Annual EBITDA and (b) actual management fees relating to Real Property for such period.
“Affiliate” means, at any time, and with respect to any Person, any other Person that at such time directly or indirectly through one or more intermediaries Controls, or is Controlled by, or is under common Control with, such first Person.  In no event shall any Person that is engaged in the business of making commercial loans (including revolving loans) in the ordinary course of business and for which the General Partner or the Company does not, directly or indirectly, possess the power to cause the direction of the investment policies of such Person be deemed to be an Affiliate of the Company.  Unless the context otherwise clearly requires, any reference to an “Affiliate” is a reference to an Affiliate of the Company.  
“Agreement” means this Note Purchase Agreement, including all Schedules attached to this Agreement.
“Annual EBITDA” means, measured as of the last day of each calendar quarter (and without duplication), an amount derived from (i) total revenues relating to all Real Property Assets of the Company, the General Partner and their Consolidated Subsidiaries or to the Company’s or the General Partner’s interest in Minority Holdings for the previous four consecutive calendar quarters including the quarter then ended, on an accrual basis without giving effect to the straight‐lining of rents, plus (ii) interest and other income of the Company, the General Partner and their Consolidated Subsidiaries, including, without limitation, real estate service revenues, for such period, plus (iii) nonrecurring extraordinary losses (including losses from the sale of Real Property Assets and/or early extinguishment of Debt or the forgiveness of Debt) for such period, plus (iv) non‐cash compensation expense for such period not in excess of $15,000,000 per annum (provided, that if at any time such threshold under the Primary Credit Facility at such time is greater or less than $15,000,000, the threshold under this definition shall be such greater or lesser amount, as the case may be, for so long as such greater or lesser amount shall remain in effect under such Primary Credit Facility), plus (v) costs and expenses incurred during such period with respect to acquisitions during such period, less (vi) total operating 

SCHEDULE A
(to Note Purchase Agreement)

expenses and other expenses relating to such Real Property Assets and to the Company’s and the General Partner’s interest in Minority Holdings for such period (other than interest, taxes, depreciation, amortization, and other non‐cash items), less (vii) total corporate operating expenses (including general overhead expenses) and other expenses of the Company, the General Partner, their Consolidated Subsidiaries and the Company’s and the General Partner’s interest in Minority Holdings (other than interest, taxes, depreciation, amortization and other non‐cash items), less (viii) gains from discontinued operations and extraordinary gains for such period, plus (ix) extraordinary losses for such period, and less (x) nonrecurring extraordinary gains (including gains from the sale of Real Property Assets and/or the early extinguishment of Debt or the forgiveness of Debt) for such period.  For purposes of this Agreement, Annual EBITDA shall be deemed to include only the Company’s pro rata share (such share being based upon the Company’s percentage ownership interest as shown on the Company’s annual audited financial statements) of the Annual EBITDA of any Person in which the Company, directly or indirectly, owns an interest.
“Anti‐Corruption Laws” means any law or regulation in a U.S. or any non‐U.S. jurisdiction regarding bribery or any other corrupt activity, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act 2010.
“Anti‐Money Laundering Laws” means any law or regulation in a U.S. or any non‐U.S. jurisdiction regarding money laundering, drug trafficking, terrorist‐related activities or other money laundering predicate crimes, including the Currency and Foreign Transactions Reporting Act of 1970 (otherwise known as the Bank Secrecy Act) and the USA PATRIOT Act.
“Applicable Interest Rate” means the lesser of (x) the rate at which the interest rate applicable to any floating rate Debt could be fixed, at the time of calculation, by the Company entering into an unsecured interest rate swap agreement (or, if such rate is incapable of being fixed by entering into an unsecured interest rate swap agreement at the time of calculation, a reasonably determined fixed rate equivalent), and (y) the rate at which the interest rate applicable to such floating rate Debt is actually capped, at the time of calculation, if the Company has entered into an interest rate cap agreement with respect thereto or if the documentation for such Debt contains a cap.
“Bank Credit Agreement” means that certain Amended and Restated Credit Agreement dated as of June 23, 2014, among the Company, JPMorgan Chase Bank, N.A., as bank and as administrative agent, and the other banks party thereto, including any renewals, extensions, amendments, supplements, restatements, replacements or refinancing in full (or a majority) thereof.
“Bankruptcy Code” means Title 11 of the United States Code, entitled “Bankruptcy”, as amended from time to time, and any successor statute or statutes.
“Bankruptcy Event” means, with respect to any Person, such Person becomes the subject of a bankruptcy or insolvency proceeding, or has had a receiver, conservator, trustee, administrator, custodian, assignee for the benefit of creditors or similar Person charged with the reorganization or liquidation of its business appointed for it, or, in the good faith determination 

A-2

of the Required Holders, has taken any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any such proceeding or appointment, provided that a Bankruptcy Event shall not result solely by virtue of any ownership interest, or the acquisition of any ownership interest, in such Person by a Governmental Authority or instrumentality thereof, unless such ownership interest results in or provides such Person with immunity from the jurisdiction of courts within the United States or from the enforcement of judgments or writs of attachment on its assets or permits such Person (or such Governmental Authority or instrumentality) to reject, repudiate, disavow or disaffirm any contracts or agreements made by such Person.  
“Blocked Person” means (a) a Person whose name appears on the list of Specially Designated Nationals and Blocked Persons published by OFAC, (b) a Person, entity, organization, country or regime that is blocked or a target of sanctions that have been imposed under U.S. Economic Sanctions Laws or (c) a Person that is an agent, department or instrumentality of, or is otherwise beneficially owned by, controlled by or acting on behalf of, directly or indirectly, any Person, entity, organization, country or regime described in clause (a) or (b).
“Business Day” means (a) for the purposes of Section 8.6 only, any day other than a Saturday, a Sunday or a day on which commercial banks in New York City are required or authorized to be closed, and (b) for the purposes of any other provision of this Agreement, any day other than a Saturday, a Sunday or a day on which commercial banks in New York, New York or Los Angeles, California are required or authorized to be closed.
“Capital Expenditures” means, for any period, the sum of all recurring expenditures on capital improvements (whether paid in cash or accrued as a liability) by the Company which are capitalized on the consolidated balance sheet of the Company in conformity with GAAP, but less (i) all expenditures made with respect to the acquisition by the Company and its Consolidated Subsidiaries of any interest in real property within nine months after the date such interest in real property is acquired and (ii) capital expenditures made from the proceeds of insurance or condemnation awards (or payments in lieu thereof) or indemnity payments received during such period by Company or any of its Consolidated Subsidiaries from third parties.  
“Cash or Cash Equivalents” means (i) cash, (ii) direct obligations of the United States Government, including, without limitation, treasury bills, notes and bonds, (iii) interest bearing or discounted obligations of Federal agencies and Government sponsored entities or pools of such instruments offered by banks rated AA or better by S&P or Aa2 by Moody’s and dealers, including, without limitation, Federal Home Loan Mortgage Corporation participation sale certificates, Government National Mortgage Association modified pass‐through certificates, Federal National Mortgage Association bonds and notes, Federal Farm Credit System securities, (iv) time deposits, domestic and Eurodollar certificates of deposit, bankers acceptances, commercial paper rated at least A‐1 by S&P and P‐1 by Moody’s, and/or guaranteed by an Aa rating by Moody’s, an AA rating by S&P, or better rated credit, floating rate notes, other money market instruments and letters of credit each issued by banks which have a long‐term debt rating of at least AA by S&P or Aa2 by Moody’s, (v) obligations of domestic corporations, including, without limitation, commercial paper, bonds, debentures, and loan participations, each of which 

A-3

is rated at least AA by S&P, and/or Aa2 by Moody’s, and/or unconditionally guaranteed by an AA rating by S&P, an Aa2 rating by Moody’s, or better rated credit, (vi) obligations issued by states and local governments or their agencies, rated at least MIG‐1 by Moody’s and/or SP‐1 by S&P and/or guaranteed by an irrevocable letter of credit of a bank with a long‐term debt rating of at least AA by S&P or Aa2 by Moody’s, (vii) repurchase agreements with major banks and primary government securities dealers fully secured by U.S. Government or agency collateral equal to or exceeding the principal amount on a daily basis and held in safekeeping, (viii) real estate loan pool participations, guaranteed by an entity with an AA rating given by S&P or an Aa2 rating given by Moody’s, or better rated credit, and (ix) shares of any mutual fund that has its assets primarily invested in the types of investments referred to in clauses (i) through (v).
“Change of Control” means
(i)     during any consecutive twenty‐four (24) month period commencing on or after the date hereof, individuals who at the beginning of such period constituted the Board of Directors of the General Partner of the Company (together with any new directors whose election by the Board of Directors or whose nomination for election by the General Partner stockholders was approved by a vote of at least a majority of the members of the Board of Directors then in the office who either were members of the Board of Directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the members of the Board of Directors then in office, except for any such change resulting from (x) death or disability of any such member, (y) satisfaction of any requirement for the majority of the members of the Board of Directors of the General Partner to qualify under applicable law as independent directors, or (z) the replacement of any member of the Board of Directors who is an officer or employee of the General Partner with any other officer or employee of the General Partner or its Affiliate; or 
(ii)     the acquisition of ownership, directly or indirectly, beneficially or of record, by any Person or group (within the meaning of the Securities Exchange Act of 1934 and the rules of the Securities and Exchange Commission thereunder as in effect on the date hereof) of equity interests representing more than thirty‐five percent (35%) of the aggregate ordinary voting power represented by the issued and outstanding equity interests of the General Partner.
“Change of Control Notice” is defined in Section 8.7.
“Closing” is defined in Section 3.
“Code” means the Internal Revenue Code of 1986 and the rules and regulations promulgated thereunder from time to time.
“Company” is defined in the first paragraph of this Agreement.

A-4

“Completion of Construction” means the issuance of a temporary or permanent certificate of occupancy for the improvements under construction, permitting the use and occupancy thereof for their regular intended uses.
“Confidential Information” is defined in Section 20.
“Consolidated Subsidiary” means, at any date, any Subsidiary or other entity which is consolidated with the Company in accordance with GAAP.
“Contingent Obligation” as to any Person means, without duplication, (i) any guaranty of the principal of the Debt of any other Person, (ii) any contingent obligation of such Person required to be shown on such Person’s balance sheet in accordance with GAAP, and (iii) any obligation required to be disclosed in the footnotes to such Person’s financial statements, guaranteeing partially or in whole any non‐recourse Debt, lease, dividend or other obligation, exclusive of contractual indemnities (including, without limitation, any indemnity or price‐adjustment provision relating to the purchase or sale of securities or other assets) and guarantees of non‐monetary obligations (other than guarantees of completion) which have not yet been called on or quantified, of such Person or of any other Person.  The amount of any Contingent Obligation described in clause (iii) shall be deemed to be (a) with respect to a guaranty of interest or interest and principal, or operating income guaranty, the sum of all payments required to be made thereunder (which in the case of an operating income guaranty shall be deemed to be equal to the debt service for the note secured thereby), calculated at the Applicable Interest Rate, through (i) in the case of an interest or interest and principal guaranty, the stated date of maturity of the obligation (and commencing on the date interest could first be payable thereunder), or (ii) in the case of an operating income guaranty, the date through which such guaranty will remain in effect, and (b) with respect to all guarantees not covered by the preceding clause (a), an amount equal to the stated or determinable amount of the primary obligation in respect of which such guaranty is made or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such Person is required to perform thereunder) as recorded on the balance sheet and on the footnotes to the most recent financial statements of the Company required to be delivered pursuant to Section 7.1 hereof.  Notwithstanding anything contained herein to the contrary, guarantees of completion shall not be deemed to be Contingent Obligations unless and until a claim for payment or performance has been made thereunder, at which time any such guaranty of completion shall be deemed to be a Contingent Obligation in an amount equal to any such claim.  Subject to the preceding sentence, (i) in the case of a joint and several guaranty given by such Person and another Person (but only to the extent such guaranty is recourse, directly or indirectly to the Company), the amount of the guaranty shall be deemed to be 100% thereof unless and only to the extent that such other Person has delivered Cash or Cash Equivalents to secure all or any part of such Person’s guaranteed obligations, (ii) in the case of joint and several guarantees given by a Person in whom the Company owns an interest (which guarantees are non‐recourse to the Company), to the extent the guarantees, in the aggregate, exceed 15% of total real estate investments of such Person, the amount in excess of 15% shall be deemed to be a Contingent Obligation of the Company, and (iii) in the case of a guaranty (whether or not joint and several) of an obligation otherwise constituting Debt of such Person, the amount of such guaranty shall be deemed to be only that amount in excess of the amount of the obligation constituting Debt of such Person.  

A-5

Notwithstanding anything contained herein to the contrary, “Contingent Obligations” shall not be deemed to include guarantees of Unused Commitments (as defined in the Bank Credit Agreement) or of construction loans to the extent the same have not been drawn.   
“Control” means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities, by contract or otherwise; and the terms “Controlled” and “Controlling” shall have meanings correlative to the foregoing.
“Controlled Entity” means (a) any of the Subsidiaries of the Company and any of their or the Company’s respective Controlled Affiliates and (b) if the Company has a parent company, such parent company and its Controlled Affiliates.
“Debt” of any Person (including Minority Holdings) means, without duplication,
(A)    (i) the face amount of all indebtedness of such Person for borrowed money or for the deferred purchase price of property or any asset and, (ii) the face amount of all indebtedness of such Person evidenced by a note, bond, debenture or similar instrument (whether or not disbursed in full in the case of a construction loan), 
(B)    the face amount of all letters of credit issued for the account of such Person and, without duplication, all unreimbursed amounts drawn thereunder, 
(C)    as shown on such Person’s balance sheet, all Contingent Obligations of such Person,
(D)    all “mark to market” liabilities of such Person under any interest rate protection agreement (including, without limitation, any interest rate swaps, caps, floors, collars and similar agreements) or other hedging agreements and currency swaps and foreign exchange contracts or similar agreements.
For purposes of this Agreement, Debt (other than direct Contingent Obligations of the General Partner, the Company or their Wholly‐Owned Subsidiaries) of the Company (or the Company, the General Partner and their Consolidated Subsidiaries on a consolidated basis) shall be deemed to include only the Company’s pro rata share (such share being based upon the Company’s percentage ownership interest as shown on the Company’s annual audited financial statements) of the Debt of any Person in which the Company, directly or indirectly, owns an interest, provided that such Debt is nonrecourse, both directly and indirectly, to the Company.
“Default” means an event or condition the occurrence or existence of which would, with the lapse of time or the giving of notice or both, become an Event of Default.
“Default Rate” means, for any series of Note, that rate of interest per annum that is the greater of (a) 2.00% above the rate of interest stated in clause (a) of the first paragraph of the Notes of such series or (b) 2.00% over the rate of interest publicly announced by JPMorgan Chase Bank, N.A. in New York, New York as its “base” or “prime” rate.

A-6

“Development Properties” means any Real Property Assets which are 100% owned in fee (or leasehold pursuant to a Financeable Ground Lease) by the Company, the General Partner or any of their Consolidated Subsidiaries or Minority Holdings and which are not subject to any Lien (other than Permitted Liens), and which are under development or redevelopment, provided that Real Property Assets shall cease to be Development Properties as of the earlier to occur of (a) the date which is eighteen (18) months after Completion of Construction thereof, and (b) the first fiscal quarter in which the occupancy rate of the applicable Development Property has averaged eighty‐five percent (85%) or more.  
“Disclosure Documents” is defined in Section 5.3.
“EDGAR” means the SEC’s Electronic Data Gathering, Analysis and Retrieval System or any successor SEC electronic filing system for such purposes.
“Environmental Laws” means any and all federal, state, local, and foreign statutes, laws, regulations, ordinances, rules, judgments, orders, decrees, permits, concessions, grants, franchises, licenses, agreements or governmental restrictions relating to pollution and the protection of the environment or the release of any materials into the environment, including those related to Hazardous Materials.
“ERISA” means the Employee Retirement Income Security Act of 1974, as amended from time to time, and the rules and regulations promulgated thereunder from time to time in effect. 
“ERISA Affiliate” means any trade or business (whether or not incorporated) that is treated as a single employer together with the Company under section 414 of the Code.
“Event of Default” is defined in Section 11.
“Execution Date” is defined in Section 3.
“FATCA” means (a) sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), together with any current or future regulations or official interpretations thereof, (b) any treaty, law or regulation of any other jurisdiction, or relating to an intergovernmental agreement between the United States of America and any other jurisdiction, which (in either case) facilitates the implementation of the foregoing clause (a), and (c) any agreements entered into pursuant to section 1471(b)(1) of the Code.
“Financeable Ground Lease” means either (x) a ground lease reasonably satisfactory to the Required Holders (provided that any ground lease that has been approved by the administrative agent or required lenders, as applicable, under the Primary Credit Facility, or that is “grandfathered” in as an eligible or financeable ground lease upon any refinancing or replacement of the Primary Credit Facility, shall be deemed to have been approved by the Required Holders), or (y) a ground lease which provides (i) for a remaining term of not less than 25 years (including options and renewals) from the date such ground lease is acquired or entered 

A-7

into, (ii) that the ground lease will not be terminated until any leasehold mortgagee shall have received notice of a default and has had a reasonable opportunity to cure the same or complete foreclosure, and has failed to do so, (iii) for a new lease on substantially the same terms to any leasehold mortgagee recognized under such ground lease as tenant if the ground lease is terminated for any reason, (iv) for non‐merger of the fee and leasehold estates, and (v) transferability of the tenant’s interest under the ground lease, subject only to the landlord’s reasonable approval.  Notwithstanding the foregoing, it is hereby agreed that the ground lease with respect to the Real Property Asset commonly known as “Kilroy Airport Center, Long Beach, California,” shall be deemed to be a “Financeable Ground Lease.”  
“FMV Cap Rate” means 6.00% (provided, that if at any time such rate under the Primary Credit Facility at such time is greater or less than 6.00%, the rate under this definition shall be such greater or lesser amount for so long as such greater or lesser amount shall remain in effect under such Primary Credit Facility; provided, further, that if at any time such rate, or a similar rate, under the Primary Credit Facility is modified, or included, to apply differently based on the property to which it applies, the applicable rate under this definition shall be similarly modified, or included, to apply differently based on the property to which it applies for so long as such rate shall remain in effect under such Primary Credit Facility).
“Form 10‐K” is defined in Section 7.1(b).
“Form 10‐Q” is defined in Section 7.1(a).
“GAAP” means (a) generally accepted accounting principles as in effect from time to time in the United States of America recognized as such in the opinions and pronouncements of the Accounting Principles Board and the American Institute of Certified Public Accountants and Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession within the United States, which are applicable to the circumstances as of the date of determination and (b) for purposes of Section 9.6, with respect to any Subsidiary, generally accepted accounting principles (including International Financial Reporting Standards, as applicable) as in effect from time to time in the jurisdiction of organization of such Subsidiary.
“General Partner” means Kilroy Realty Corporation, a Maryland corporation.
“General Partner Guaranty” means the guaranty of the Notes substantially in the form of Schedule 1.2 delivered by the General Partner.
“Governmental Authority” means
(a)    the government of
(i)    the United States of America or any state or other political subdivision thereof, or

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(ii)    any other jurisdiction in which the General Partner, the Company or any Subsidiary conducts all or any part of its business, or which asserts jurisdiction over any properties of the General Partner, the Company or any Subsidiary, or
(b)    any entity exercising executive, legislative, judicial, regulatory or administrative functions of, or pertaining to, any such government.  
“Governmental Official” means any governmental official or employee, employee of any government‐owned or government‐controlled entity, political party, any official of a political party, candidate for political office, official of any public international organization or anyone else acting in an official capacity.
“Hazardous Materials” means any and all pollutants, toxic or hazardous wastes or other substances that might pose a hazard to health and safety, the removal of which may be required or the generation, manufacture, refining, production, processing, treatment, storage, handling, transportation, transfer, use, disposal, release, discharge, spillage, seepage or filtration of which is or shall be restricted, prohibited or penalized by any applicable law, including asbestos, urea formaldehyde foam insulation, polychlorinated biphenyls, petroleum, petroleum products, lead based paint, radon gas or similar restricted, prohibited or penalized substances.
“holder” means, with respect to any Note, the Person in whose name such Note is registered in the register maintained by the Company pursuant to Section 13.1, provided, however, that if such Person is a nominee, then for the purposes of Sections 7, 12, 17.2 and 18 and any related definitions in this Schedule A, “holder” shall mean the beneficial owner of such Note whose name and address appears in such register.
“INHAM Exemption” is defined in Section 6.2(e).
“Institutional Investor” means (a) any Purchaser of a Note, (b) any holder of a Note holding (together with one or more of its affiliates) more than 5% of the aggregate principal amount of the Notes then outstanding, (c) any bank, trust company, savings and loan association or other financial institution, any pension plan, any investment company, any insurance company, any broker or dealer, or any other similar financial institution or entity, regardless of legal form, and (d) any Related Fund of any holder of any Note.
“Investor Presentation” is defined in Section 5.3. 
“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind, or any other type of preferential arrangement that has the practical effect of creating a security interest, in respect of such asset.  For the purposes of this Agreement, each of the Company and any Subsidiary shall be deemed to own subject to a Lien any asset which it has acquired or holds subject to the interest of a vendor or lessor under any conditional sale agreement, capital lease or other title retention agreement relating to such asset. 
“Make‐Whole Amount” is defined in Section 8.6.

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“Material” means material in relation to the business, operations, affairs, financial condition, assets, properties, or prospects of the Company and its Subsidiaries taken as a whole.
“Material Adverse Effect” means a material adverse effect on (a) the business, operations, affairs, financial condition, assets or properties of the Company and its Subsidiaries taken as a whole, (b) the ability of the Company to perform its obligations under this Agreement and the Notes, (c) the ability of any Note Guarantor to perform its obligations under its Note Guaranty, or (d) the validity or enforceability of this Agreement, the Notes or any Note Guaranty.
“Material Credit Facility” means, as to the Company and its Subsidiaries,
(a)    the Primary Credit Facility, including any renewals, extensions, amendments, supplements, restatements, or replacements or refinancings in full thereof; and
(b)    any other agreement(s) creating or evidencing indebtedness for borrowed money (other than Non‐Recourse Debt or Permitted Intercompany Debt) entered into on or after the date of Closing by the Company or any Subsidiary, or in respect of which the Company or any Subsidiary is an obligor or otherwise provides a guarantee or other credit support (“Credit Facility”), in a principal amount outstanding or available for borrowing equal to or greater than $200,000,000 (or the equivalent of such amount in the relevant currency of payment, determined as of the date of the closing of such facility based on the exchange rate of such other currency); and if no Credit Facility or Credit Facilities equal or exceed such amounts and if the Primary Credit Facility is no longer in effect, then the largest Credit Facility shall be deemed to be a Material Credit Facility.
“Material Subsidiary” means any Subsidiary of the Company and/or the General Partner to which 10% or more of Total Asset Value is attributable.
“Maturity Date” is defined in the first paragraph of each Note.
“MFL Provision” means any covenant (whether constituting a covenant or an event of default) that requires the General Partner, the Company or any Subsidiary to (i) maintain any level of debt service with respect to unencumbered assets or (ii) limits or restricts the payment of dividends; provided, that, for the avoidance of doubt, as of the date of Closing, a MFL Provision shall include the “Unencumbered Asset Pool Debt Service Coverage” and “Dividends” covenants set forth in Section 5.8(e) and (f), respectively, of the Bank Credit Agreement. 
“Minority Holdings” means partnerships, limited liability companies and corporations held or owned by the Company which are not consolidated with the Company on its financial statements.
“Moody’s” means Moody’s Investors Service, Inc. or any successor thereto.

A-10

“Multiemployer Plan” means a “multiemployer plan” (as such term is defined in section 4001(a)(3) of ERISA) to which the Company or any ERISA Affiliate thereof makes or is obligated to make contributions, or during the preceding six plan years, has made or been obligated to make contributions.
“NAIC” means the National Association of Insurance Commissioners.
“Non‐Recourse Debt” means Debt of the Company or the General Partner or any Subsidiary (a) for which the right of recovery of the obligee thereof is limited to recourse against the Real Property Assets securing such Debt (subject to such limited exceptions to the non‐recourse nature of such Debt such as fraud, misappropriation, misapplication and environmental indemnities, as are usual and customary in like transactions at the time of the incurrence of such Debt) or (b) with respect to any Subsidiary of the Company or the General Partner, as applicable, if such person is a Single Asset Entity, any Debt of such Subsidiary.  A loan secured by multiple properties owned by Single Asset Entities shall be considered Non‐Recourse Debt of such Single Asset Entities even if such Debt is cross‐defaulted and cross‐collateralized with the loans to such other Single Asset Entities.  
“Non‐U.S. Plan” means any plan, fund or other similar program that (a) is established or maintained outside the United States of America by the Company or any Subsidiary primarily for the benefit of employees of the Company or one or more Subsidiaries residing outside the United States of America, which plan, fund or other similar program provides, or results in, retirement income, a deferral of income in contemplation of retirement or payments to be made upon termination of employment, and (b) is not subject to ERISA or the Code.
“Note Documents” means this Agreement, the Notes, the Note Guaranties, and all other documents, certificates, requests, reports instruments or agreements now or hereafter executed or delivered by or on behalf of the General Partner, the Company or the Subsidiary Guarantors in connection with the Notes or pursuant to the Note Documents.
“Note Guarantors” means the General Partner and the Subsidiary Guarantors and “Note Guarantor” means any one of them.
“Note Guaranties” means the General Partner Guaranty and the Subsidiary Guaranties and “Note Guaranty” manes any one of them.
“Note Parties” means the General Partner, the Company and the Subsidiary Guarantors.
“Notes” is defined in Section 1.
“OFAC” means the Office of Foreign Assets Control of the United States Department of the Treasury.
“OFAC Sanctions Program” means any economic or trade sanction that OFAC is responsible for administering and enforcing.  A list of OFAC Sanctions Programs may be found at http://www.treasury.gov/resource‐center/sanctions/Programs/Pages/Programs.aspx.

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“Officer’s Certificate” means a certificate of a Senior Financial Officer or of any other officer of the Company whose responsibilities extend to the subject matter of such certificate.
“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in ERISA or any successor thereto.
“Pension Plan” means any employee pension benefit plan as defined in Section 3(2) of ERISA (but not a Multiemployer Plan) that is maintained or contributed to or has within the preceding five years been maintained or contributed to by the Company, the Parent Guarantor or any ERISA Affiliate, and is either covered by Title IV of ERISA or is subject to the minimum funding standards under Section 412 of the Code.
“Permitted Intercompany Debt” means Debt of any Note Party or Subsidiary of a Note Party owed to one or more Subsidiaries of the Company, which Debt is secured by a direct or indirect pledge of the equity interests of any Subsidiary of the obligor of such Debt.
“Permitted Intercompany Pledge” means Liens granted by the Company or any direct or indirect Subsidiaries of the Company in favor of one or more Subsidiaries of the Company securing Permitted Intercompany Debt that (a) is in an aggregate outstanding amount not at any time exceeding the book value of the equity interests (including common and preferred equity interests) owned by Company and/or one or more of its Subsidiaries in the obligee Subsidiaries of such Permitted Intercompany Debt and (b) is in an aggregate outstanding amount not in excess of Unencumbered Asset Pool Properties Value of the related Permitted Pledged Real Property Assets (for the avoidance of doubt, calculated as if such Permitted Pledged Real Property Assets are eligible for inclusion in the determination of Unencumbered Asset Pool Properties Value). 
“Permitted Liens” means
(a)    Liens in favor of the Note Parties on all or any part of the assets of Note Parties or Subsidiaries of the Note Parties, provided that (i) the Debt to which such Lien relates is held by a Note Party and (ii) such Debt is not otherwise pledged or encumbered; 
(b)    Liens to secure the performance of statutory obligations, surety or appeal bonds, performance bonds, completion bonds, government contracts or other obligations of a like nature, including Liens in connection with workers’ compensation, unemployment insurance and other types of statutory obligations or to secure the performance of tenders, bids, leases, contracts (other than for the repayment of Debt) and other similar obligations incurred in the ordinary course of business; 
(c)    Liens for taxes, assessments or governmental charges or claims that are not yet delinquent or that are being contested in good faith by appropriate proceedings promptly instituted and diligently concluded; provided, that any reserve or other appropriate provision as shall be required in conformity with GAAP shall have been made therefor; 

A-12

(d)    Liens on property of the Company, the General Partner or any Subsidiary thereof in favor of the Federal or any state government to secure certain payments pursuant to any contract, statute or regulation; 
(e)    easements (including, without limitation, reciprocal easement agreements and utility agreements), rights of way, covenants, consents, reservations, encroachments, variations and zoning and other restrictions, charges or encumbrances (whether or not recorded), which do not interfere materially with the ordinary conduct of the business of the Company, the General Partner or any Subsidiary thereof and which do not materially detract from the value of the property to which they attach or materially impair the use thereof by the Company, the General Partner or any Subsidiary thereof; 
(f)    statutory Liens of carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other Liens imposed by law and arising in the ordinary course of business, for sums due and payable which are not then past due (or which, if past due, are being contested in good faith and with respect to which adequate reserves are being maintained to the extent required by GAAP); 
(g)    Liens not otherwise permitted by this definition and incurred in the ordinary course of business of any or all of the Company, the General Partner or any Subsidiary thereof with respect to obligations which do not exceed $500,000 in principal amount (provided, that if at any time such Lien limit under the Primary Credit Facility at such time is greater than $500,000, the Lien limit under this clause shall be such greater amount for so long as such greater amount shall remain in effect under such Primary Credit Facility) in the aggregate at any one time outstanding; 
(h)    the interests of lessees and lessors under leases of real or personal property made in the ordinary course of business which would not have a Material Adverse Effect; and
(i)    Permitted Unsecured Debt Restrictions.
“Permitted Pledged Real Property Asset” means a Real Property Asset of a Subsidiary of the Company, the direct or indirect equity interests in which are subject to a Permitted Intercompany Pledge.
“Permitted Unsecured Debt Restrictions” means restrictions that are contained in documentation evidencing or governing Unsecured Debt which encumbrances are the result of (i) limitations on the ability of the General Partner, the Company or any Subsidiary thereof to transfer property to the Company or any Guarantor, (ii) limitations on the ability of the General Partner, the Company or any Subsidiary to create, incur, assume or suffer to exist Liens on Unencumbered Asset Pool Properties or the equity interests of any Person that owns, or ground leases under a Financeable Ground Lease, an Unencumbered Asset Pool Property (or the equity interest of any Subsidiary of the General Partner or the Company that directly or indirectly owns any equity interests in such Person) or (iii) any requirement that Unsecured Debt be secured on an “equal and ratable basis” to the extent that the Notes are secured.

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“Person” means an individual, partnership, corporation, limited liability company, association, trust, unincorporated organization, business entity or Governmental Authority.
“Plan” means an “employee benefit plan” (as defined in section 3(3) of ERISA) subject to Title I of ERISA that is or, within the preceding five years, has been established or maintained, or to which contributions are or, within the preceding five years, have been made or required to be made, by the Company or any ERISA Affiliate or with respect to which the Company or any ERISA Affiliate may have any liability.
“Primary Credit Facility” means the Bank Credit Agreement, including any renewals, extensions, amendments, supplements, restatements, replacements, increases or refinancings in full (or a majority) thereof (whether such renewal, extension, amendment, restatement, replacement, increases or refinancings in full (or a majority) of such agreement is entered into substantially concurrently with the termination of the existing agreement or at any time before or after if no new agreement is then substantially concurrently entered into).
“Primary Credit Facility Additional Provisions” is defined in Section 10.6.
“property” or “properties” means, unless otherwise specifically limited, real or personal property of any kind, tangible or intangible, choate or inchoate.
“Proposed Prepayment Date” is defined in Section 8.7.
“PTE” is defined in Section 6.2(a).
“Purchaser” or “Purchasers” means each of the purchasers that has executed and delivered this Agreement to the Company and such Purchaser’s successors and assigns (so long as any such assignment complies with Section 13.2), provided, however, that any Purchaser of a Note that ceases to be the registered holder or a beneficial owner (through a nominee) of such Note as the result of a transfer thereof pursuant to Section 13.2 shall cease to be included within the meaning of “Purchaser” of such Note for the purposes of this Agreement upon such transfer.
“Purchaser Schedule” means the Purchaser Schedule to this Agreement listing the Purchasers of the Notes and including their notice and payment information.
“Qualified Institutional Buyer” means any Person who is a “qualified institutional buyer” within the meaning of such term as set forth in Rule 144A(a)(1) under the Securities Act.
“QPAM Exemption” is defined in Section 6.2(d).
“Real Property Assets” means as of any time, the real property assets owned directly or indirectly by the Company, the General Partner and/or their Consolidated Subsidiaries or Minority Holdings at such time, and “Real Property Asset” means any one of them.  
“Recourse Debt” shall mean Debt of the Company, the General Partner or any Consolidated Subsidiary that is not Non‐Recourse Debt.  

A-14

“Related Fund” means, with respect to any holder of any Note, any fund or entity that (a) invests in Securities or bank loans, and (b) is advised or managed by such holder, the same investment advisor as such holder or by an affiliate of such holder or such investment advisor.
“Required Holders” means at any time (i) prior to Closing, the Purchasers and (ii) on or after the Closing, the holders of more than 50% in principal amount of the Notes at the time outstanding (exclusive of Notes then owned by the Company or any of its Affiliates).
“Responsible Officer” means any Senior Financial Officer and any other officer of the Company with responsibility for the administration of the relevant portion of this Agreement.
“REIT” means a real estate investment trust under Section 856 of the Internal Revenue Code.
“SEC” means the Securities and Exchange Commission of the United States of America.
“Secured Debt” means all Debt secured by a Lien on real property.  
“Securities” or “Security” shall have the meaning specified in section 2(1) of the Securities Act. 
“Securities Act” means the Securities Act of 1933 and the rules and regulations promulgated thereunder from time to time in effect.
“Senior Financial Officer” means the chief financial officer, principal accounting officer, treasurer or controller of the Company.
“series” means any series of Notes issued pursuant to this Agreement.
“Series A Notes” is defined in Section 1.1 of this Agreement.
“Series B Notes” is defined in Section 1.1 of this Agreement.
“Single Asset Entity” means a bankruptcy remote, single purpose entity which is a Subsidiary of the Company or of the General Partner, as applicable, which owns real property and related assets which are security for Debt of such entity, and which Debt does not constitute Debt of any other Person except as provided in the definition of Non‐Recourse Debt (except for limited exceptions to the non‐recourse nature of such Debt such as fraud, misappropriation, misapplication and environmental indemnities, as are usual and customary in like transactions at the time of the incurrence of such Debt). In addition, if the assets of a Person that is a bankruptcy remote, single purpose entity which is a Subsidiary of the Company or of the General Partner, as applicable, consist solely of (i) equity interests in one or more other Single Asset Entities and (ii) cash and other assets of nominal value incidental to such Person’s ownership of the other Single Asset Entities, such Person shall also be deemed to be a Single Asset Entity for purposes hereof.  

A-15

“Solvent” means, with respect to any Person, that the fair saleable value of such Person’s assets exceeds the Debts of such Person.  
“Source” is defined in Section 6.2.
“State Sanctions List” means a list that is adopted by any state Governmental Authority within the United States of America pertaining to Persons that engage in investment or other commercial activities in Iran or any other country that is a target of economic sanctions imposed under U.S. Economic Sanctions Laws.
“Subsidiary” any corporation or other entity of which securities or other ownership interests representing either (i) ordinary voting power to elect a majority of the board of directors or other persons performing similar functions or (ii) a majority of the economic interest therein, are at the time directly or indirectly owned by the Company.
“Subsidiary Guarantor” means each Subsidiary that has executed and delivered a Subsidiary Guaranty.
“Subsidiary Guaranty” is defined in Section 9.7(a).
“Substitute Purchaser” is defined in Section 21.
“SVO” means the Securities Valuation Office of the NAIC.
“S&P” means Standard & Poor’s Ratings Service, a division of The McGraw‐Hill Companies, Inc., or any successor thereto.
“Total Asset Value” means, the sum of (v) with respect to each Real Property Asset (excluding Acquisition Properties) for which there is a valid certificate of occupancy or a representation from the Company that it is legally permitted to occupy such Real Property Asset and is not less than 85% leased and occupied as of the last day of the applicable fiscal quarter, the quotient of (i) Adjusted Annual EBITDA (calculated after giving effect to any required free rent periods by calculating the average cash rent over the term of the lease during such free rent periods) with respect thereto for the previous four (4) consecutive quarters (or, if (A) owned for less than four (4) quarters, the Adjusted Annual EBITDA (calculated after giving effect to any required free rent periods by calculating the average cash rent over the term of the lease during such free rent periods) for such period, annualized, or (B) 85% leased and occupied for less than a full fiscal quarter, the Adjusted Annual EBITDA (calculated after giving effect to any required free rent periods by calculating the average cash rent over the term of the lease during such free rent periods) for the period so leased and occupied (whether or not owned for the previous four (4) fiscal quarters), annualized), including the quarter then ended, but less reserves for Capital Expenditures of (A) $.30 per square foot per annum for each Real Property Asset that is an office property and (B) $.15 per square foot per annum for each Real Property Asset that is an industrial property, divided by (ii) the FMV Cap Rate, (w) with respect to each Real Property Asset (excluding Acquisition Properties) for which there is a valid certificate of occupancy or a representation from the Company that it is lawfully permitted to occupy such Real Property 

A-16

Asset but which is or has been less than 85% leased or occupied for four full consecutive fiscal quarters, an amount equal to 75% of the book value thereof, net of impairment charges, provided, however, that if any such Real Property Asset shall remain less than 85% leased or occupied for more than 24 consecutive months, then the value thereof shall be equal to 50% of book value, (x) with respect to each Acquisition Property, 100% of its book value (after any impairments), unless the Company has made a one‐time election to value such Real Property Asset in accordance with clause (v) or (w) hereof, (y) with respect to land and Development Properties and mortgage notes, the lesser of (i) the cost actually paid by the Company, the General Partner or any of their Subsidiaries, and (ii) the market value, each as determined in accordance with GAAP, of such land, Development Properties and mortgage notes, and (z) Unrestricted Cash or Cash Equivalents of the Company, the General Partner and their Subsidiaries as of the date of determination; provided that (i) Total Asset Value shall include the Company’s and the General Partner’s pro rata share of each of the foregoing of any Minority Holdings of the Company or the General Partner and (ii) for purposes of determining Total Asset Value, the aggregate contributions to Total Asset Value from investments in land and Development Properties and mortgage notes and from the Company’s and the General Partner’s interests in any joint venture, whether consolidated or unconsolidated, shall not exceed 30% of Total Asset Value.  
“Total Debt” means all Debt of the Company, the General Partner and their Consolidated Subsidiaries on a consolidated basis.
“Total Debt Ratio” means the ratio, as of the date of determination, of (i) the sum of (x) the Total Debt of the Company, the General Partner and their Consolidated Subsidiaries and (y) the Company’s and the General Partner’s pro rata share of the Total Debt of any Minority Holdings of the Company or the General Partner to (ii) Total Asset Value.
“Total Debt Service” means, as of the last day of each calendar quarter, an amount equal to the sum of (i) interest (whether accrued, paid or capitalized) payable by Company on its Debt for the previous four consecutive quarters including the quarter then ended on a consolidated basis, plus (ii) scheduled payments of principal on such Debt, whether or not paid by the Company (excluding balloon payments) for the previous four consecutive quarters including the quarter then ended on a consolidated basis, plus (iii) the Company’s and the General Partner’s pro rata share of the Total Debt Service of any Minority Holdings of the Company or the General Partner.
“Unencumbered Asset Pool Net Operating Cash Flow” means, as of any date of determination the Adjusted Annual EBITDA attributable to the Unencumbered Asset Pool Properties.  Notwithstanding the foregoing, with respect to any Unencumbered Asset Pool Property owned by the Company, the General Partner or any of their Consolidated Subsidiaries for a period of less four (4) fiscal quarters, Unencumbered Asset Pool Net Operating Cash Flow shall be determined in a manner consistent with the foregoing calculation utilizing annualized Adjusted Annual EBITDA for the relevant period of the Company’s, the General Partner’s or any of their Consolidated Subsidiaries’ ownership of such Unencumbered Asset Pool Property. 

A-17

“Unencumbered Asset Pool Properties” means, as of any date, the Real Property Assets listed in Schedule 10.5(a) and Schedule 10.5(b) attached hereto and made a part hereof, together with all Real Property Assets which have become part of the Unencumbered Asset Pool Properties as of such date, each of which is: 
(i)    located in the United States;
(ii)    100% owned in fee (or leasehold pursuant to a Financeable Ground Lease in the case of assets listed on Schedule 10.5(b) as leaseholds and assets acquired after the Execution Date as leaseholds) by (x) the Company or (y) a wholly‐owned direct or indirect Subsidiary of the Company and/or the General Partner that is not liable for any Debt for borrowed money (other than (A) the obligations under the Notes (and any guaranty thereof), (B) the “Obligations” under any Material Credit Facility or any other Unsecured Debt permitted hereunder, (C) obligations owing to a Note Party and (D) other Secured Debt permitted hereunder so long as such Secured Debt is not in any manner secured by such assets; provided that, in any case, no asset shall be deemed an “Unencumbered Asset Pool Property” if it is owned by a Subsidiary that is obligated in respect of outstanding Debt for borrowed money that constitutes Recourse Debt owed to a Person other than a Note Party unless such Subsidiary is a Guarantor and is not the subject of a Bankruptcy Event;
(iii)    either (individually or when combined with any other Real Property Asset in a mixed‐use complex) a completed office property, industrial property, residential property, retail property, or primarily a completed office property which may have secondary uses or any of the foregoing that is part of a mixed‐use complex or a Development Property which will be any of the foregoing or a mortgage note;
(iv)    not subject to any Lien (other than Permitted Liens);
(v)    in the case of a Real Property Asset owned or leased by a wholly‐owned Subsidiary, not subject to any agreement or arrangement by which the direct or indirect equity interests in such Subsidiary are subject to any Lien (other than Permitted Liens); and
(vi)    not subject to any agreement or arrangement that prohibits or restricts the creation or assumption of any Lien on the assets of, or equity interests in, the Company or Subsidiary that owns or leases such Real Property Asset (provided that this clause (vi) shall not prohibit an agreement that (a) is in favor of a Note Party; (b) conditions a Person’s ability to encumber its assets upon the maintenance of one or more specified ratios or financial tests (including any financial ratio such as a maximum ratio of unsecured debt to unencumbered assets) that limit such Person’s ability to encumber its assets but that do not generally prohibit the encumbrance of its assets, or the encumbrance of specific assets; or (c) requires the grant of a Lien to secure Unsecured Debt permitted hereunder of such Person if a Lien is granted to secure the obligations or other Unsecured Debt permitted hereunder of such Person).

A-18

“Unencumbered Asset Pool Properties Value” means the sum of:
(i)    with respect to the Unencumbered Asset Pool Properties (excluding Acquisition Properties) for which there is a valid certificate of occupancy or a representation from the Company that it is legally permitted to occupy such Real Property Asset and which is not less than 85% leased and occupied as of the last day of the applicable fiscal quarter, the quotient of (x) the Unencumbered Asset Pool Net Operating Cash Flow (calculated after giving effect to any required free rent periods by calculating the average cash rent over the term of the lease during such free rent periods) with respect thereto for the previous four (4) consecutive quarters (or if (A) owned for less than four (4) quarters, the Unencumbered Asset Pool Net Operating Cash Flow (calculated after giving effect to any required free rent periods by calculating the average cash rent over the term of the lease during such free rent periods) for such period, annualized, or (B) 85% leased and occupied for less than a full fiscal quarter, the Unencumbered Asset Pool Net Operating Cash Flow (calculated after giving effect to any required free rent periods by calculating the average cash rent over the term of the lease during such free rent periods) for the period so leased and occupied (whether or not owned for the previous four (4) fiscal quarters), annualized), including the quarter then ended, but less reserves for Capital Expenditures of (i) $.30 per square foot per annum for each Unencumbered Asset Pool Property that is an office property and (ii) $.15 per square foot per annum for each Unencumbered Asset Pool Property that is an industrial property, divided by (y) the FMV Cap Rate, provided, however, that if any such Unencumbered Asset Pool Property shall have been less than 85% leased and occupied for four (4) full consecutive fiscal quarters, then the value thereof shall be equal to an amount equal to 75% of the book value thereof, net of impairment charges, provided, however, that if any such Real Property Asset shall remain less than 85% leased or occupied for more than 24 consecutive months, then the value thereof shall be equal to 50% of book value; and
(ii)    with respect to the Unencumbered Asset Pool Properties which are Development Properties or mortgage notes, fifty percent (50%) of (A) in the case of Development Properties, the lesser of (A) the cost actually paid by the Company, the General Partner or any of their Subsidiaries, and (B) the market value, each as determined in accordance with GAAP, of such Development Properties, and (B) in the case of mortgage notes, the book value thereof, determined in accordance with GAAP, provided that the value attributable to Development Properties and mortgage notes, in the aggregate shall not at any time exceed 15% of Unencumbered Asset Pool Properties Value; and
(iii)    with respect to the Unencumbered Asset Pool Properties which are Acquisition Properties, 100% of book value (after any impairments) of such Acquisition Properties, unless the Company has made a one‐time election to value such Real Property Asset in accordance with clause (i) of this definition; and
(iv)    Unrestricted Cash or Cash Equivalents of the Company, the General Partner and their Subsidiaries as of the date of determination;

A-19

provided, that for purposes of determining the Unsecured Debt Ratio (a) on any date of determination, Unencumbered Asset Pool Properties Value shall include value attributable to a Permitted Pledged Real Property Asset that would be an Unencumbered Asset Pool Property but for such Permitted Pledged Real Property Asset being owned or leased by a Subsidiary of the Company that is subject to a pledge of the direct or indirect equity interest in such Subsidiary to a Subsidiary of the Company to secure Permitted Intercompany Debt to the extent that on such date of determination, such Permitted Pledged Real Property Asset is permitted to be included in the determination of “Unencumbered Asset Pool Properties Value” (or the similar or equivalent term) in the Primary Credit Facility for purposes of calculating the limitation on unsecured debt to unencumbered asset value (or similar financial covenant) under the Primary Credit Facility (which value for the avoidance of doubt, shall be calculated as if such Permitted Pledged Real Property Asset is an Unencumbered Asset Pool Property) and (b) the portion of the aggregate Unencumbered Asset Pool Properties Value attributable to Permitted Pledged Real Property Assets shall not exceed the lesser of (1) 10% of the total Unencumbered Asset Pool Properties Value (including the Unencumbered Asset Pool Properties Value of such Permitted Pledged Real Property Assets) and (2) the product of (x) 1.50 and (y) the outstanding principal amount of the Permitted Intercompany Debt secured by a direct or indirect pledge of the equity interests in the Subsidiaries that own such Permitted Pledged Real Property Assets. 
 “United States Person” has the meaning set forth in Section 7701(a)(30) of the Code.
“Unrestricted Cash or Cash Equivalents” means Cash or Cash Equivalents, including the cash proceeds of any like‐kind exchange under Section 1031 of the Internal Revenue Code, that is not subject to any pledge, lien or control agreement, less (i) $35,000,000 (provided, that if at any time such amount under the Primary Credit Facility at such time is greater or less than $35,000,000, such amount under this clause shall be such greater or lesser amount, as the case may be, for so long as such greater or lesser amount shall remain in effect under such Primary Credit Facility), (ii) amounts normally and customarily set aside by Company for operating, capital and interest reserves, and (iii) amounts placed with third parties as deposits or security for contractual obligations.
“Unsecured Debt” means Debt not secured by a Lien on real property.
“Unsecured Debt Ratio” means, as of any date of determination, the ratio of the Unencumbered Asset Pool Properties Value as of the date of determination to the aggregate amount of Unsecured Debt of the Company, the General Partner and their Consolidated Subsidiaries on a consolidated basis outstanding as of such date of determination.
“Unsecured Debt Service” means, for any calendar quarter, the interest actually payable (or accrued) on the Notes and all other Unsecured Debt of the General Partner, the Company and their Consolidated Subsidiaries on a consolidated basis.
“USA PATRIOT Act” means United States Public Law 107‐56, Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct 

A-20

Terrorism (USA PATRIOT ACT) Act of 2001 and the rules and regulations promulgated thereunder from time to time in effect.
“U.S. Economic Sanctions Laws” means those laws, executive orders, enabling legislation or regulations administered and enforced by the United States pursuant to which economic sanctions have been imposed on any Person, entity, organization, country or regime, including the Trading with the Enemy Act, the International Emergency Economic Powers Act, the Iran Sanctions Act, the Sudan Accountability and Divestment Act and any other OFAC Sanctions Program.
“Wholly‐Owned Subsidiary” means, at any time, any Subsidiary all of the equity interests (except directors’ qualifying shares) and voting interests of which are owned by any one or more of the General Partner and the General Partner’s other Wholly‐Owned Subsidiaries at such time.

A-21

[Form of Series A Note]
Kilroy Realty, L.P.
3.35% Senior Notes, Series A, due February 17, 2027
No. [_____]    [Date]
$[_______]    PPN 49427R A#9

For Value Received, the undersigned, Kilroy Realty, L.P. (herein called the “Company”), a limited partnership organized and existing under the laws of the State of Delaware, hereby promises to pay to [____________], or registered assigns, the principal sum of [_____________________] Dollars (or so much thereof as shall not have been prepaid) on February 17, 2027 (the “Maturity Date”), with interest (computed on the basis of a 360‐day year of twelve 30‐day months) (a) on the unpaid balance hereof at the rate of 3.35% per annum from the date hereof, payable semiannually, on 17th day of February and August in each year, commencing with the February 17 or August 17 next succeeding the date hereof, and on the Maturity Date, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and (y) during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make‐Whole Amount, at a rate per annum from time to time equal to the greater of (i) 5.35% or (ii) 2.00% over the rate of interest publicly announced by JPMorgan Chase Bank, N.A. from time to time in New York, New York as its “base” or “prime” rate, payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on and any Make‐Whole Amount with respect to this Note are to be made in lawful money of the United States of America at JPMorgan Chase Bank, N.A. or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of a series of Senior Notes, Series A (herein called the “Notes”) issued pursuant to the Note Purchase Agreement, dated September 14, 2016 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof.  Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, 

SCHEDULE 1 - A
(To Note Purchase Agreement)

the transferee.  Prior to due presentment for registration of transfer, the Company may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.
This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make‐Whole Amount) and with the effect provided in the Note Purchase Agreement.
This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice‐of‐law principles of the law of such State that would permit the application of the law of a jurisdiction other than such State.

	
						
	 
	 
	Kilroy Realty, L.P.
	 

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	By:
	 
	Kilroy Realty Corporation, a

	 
	 
	 
	 
	Maryland corporation, its general partner
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	 
	 

	 
	 
	 
	 
	Title:

	 

1- A-2

[Form of Series B Note]
Kilroy Realty, L.P.
3.45% Senior Notes, Series B, due February 17, 2029
No. [_____]    [Date]
$[_______]    PPN 49427R B*2

For Value Received, the undersigned, Kilroy Realty, L.P. (herein called the “Company”), a limited partnership organized and existing under the laws of the State of Delaware, hereby promises to pay to [____________], or registered assigns, the principal sum of [_____________________] Dollars (or so much thereof as shall not have been prepaid) on February 17, 2029 (the “Maturity Date”), with interest (computed on the basis of a 360‐day year of twelve 30‐day months) (a) on the unpaid balance hereof at the rate of 3.45% per annum from the date hereof, payable semiannually, on the 17th day of February and August in each year, commencing with the February 17 or August 17 next succeeding the date hereof, and on the Maturity Date, until the principal hereof shall have become due and payable, and (b) to the extent permitted by law, (x) on any overdue payment of interest and (y) during the continuance of an Event of Default, on such unpaid balance and on any overdue payment of any Make‐Whole Amount, at a rate per annum from time to time equal to the greater of (i) 5.45% or (ii) 2.00% over the rate of interest publicly announced by JPMorgan Chase Bank, N.A. from time to time in New York, New York as its “base” or “prime” rate, payable semiannually as aforesaid (or, at the option of the registered holder hereof, on demand).
Payments of principal of, interest on and any Make‐Whole Amount with respect to this Note are to be made in lawful money of the United States of America at JPMorgan Chase Bank, N.A. or at such other place as the Company shall have designated by written notice to the holder of this Note as provided in the Note Purchase Agreement referred to below.
This Note is one of a series of Senior Notes, Series B (herein called the “Notes”) issued pursuant to the Note Purchase Agreement, dated September 14, 2016 (as from time to time amended, the “Note Purchase Agreement”), between the Company and the respective Purchasers named therein and is entitled to the benefits thereof.  Each holder of this Note will be deemed, by its acceptance hereof, to have (i) agreed to the confidentiality provisions set forth in Section 20 of the Note Purchase Agreement and (ii) made the representation set forth in Section 6.2 of the Note Purchase Agreement.  Unless otherwise indicated, capitalized terms used in this Note shall have the respective meanings ascribed to such terms in the Note Purchase Agreement.
This Note is a registered Note and, as provided in the Note Purchase Agreement, upon surrender of this Note for registration of transfer accompanied by a written instrument of transfer duly executed, by the registered holder hereof or such holder’s attorney duly authorized in writing, a new Note for a like principal amount will be issued to, and registered in the name of, 

SCHEDULE 1-B
(to Note Purchase Agreement)

the transferee.  Prior to due presentment for registration of transfer, the Company may treat the Person in whose name this Note is registered as the owner hereof for the purpose of receiving payment and for all other purposes, and the Company will not be affected by any notice to the contrary.
This Note is subject to optional prepayment, in whole or from time to time in part, at the times and on the terms specified in the Note Purchase Agreement, but not otherwise.
If an Event of Default occurs and is continuing, the principal of this Note may be declared or otherwise become due and payable in the manner, at the price (including any applicable Make‐Whole Amount) and with the effect provided in the Note Purchase Agreement.
This Note shall be construed and enforced in accordance with, and the rights of the Company and the holder of this Note shall be governed by, the law of the State of New York excluding choice‐of‐law principles of the law of such State that would permit the application of the law of a jurisdiction other than such State.

	
						
	 
	 
	Kilroy Realty, L.P.
	 

	 
	 
	 
	 

	 
	 
	 
	 

	 
	 
	By:
	 
	Kilroy Realty Corporation, a

	 
	 
	 
	 
	Maryland corporation, its general partner
	 

	 
	 
	 
	 
	 
	 

	 
	 
	By:
	 
	 
	 

	 
	 
	 
	 
	Title:
	 

1-B-2

FORM OF GENERAL PARTNER GUARANTY

[see attached]

SCHEDULE 1.2
(to Note Purchase Agreement)

General Partner Guaranty Agreement
Dated as of February 17, 2017
of 
Kilroy Realty Corporation 
relating to
$175,000,000 3.35% Senior Notes, Series A, due February 17, 2027
$75,000,000 3.45% Senior Notes, Series B, due February 17, 2029
of
Kilroy Realty, L.P.

TABLE OF CONTENTS
	
			
	 

	SECTION
	HEADING
	PAGE

	Section 1.
	Guaranty
	1

	Section 2.
	Obligations Absolute
	2

	Section 3.
	Waiver
	3

	Section 4.
	Obligations Unimpaired
	3

	Section 5.
	Subrogation and Subordination
	4

	Section 6. 
	Reinstatement of Guaranty
	5

	Section 7.
	Rank of Guaranty
	5

	Section 8.
	Additional Covenants of the Guaranty
	5

	Section 9.
	Representations and Warranties of the Guarantor
	5

	Section 9.1.
	Organization; Power and Authority
	5

	Section 9.2.
	Authorization, Etc
	6

	Section 9.3.
	[Reserved]
	6

	Section 9.4.
	Compliance with laws; Other Instruments, Etc
	6

	Section 9.5
	Governmental Authorizations, Etc
	6

	Section 9.6.
	Information Regarding the Company
	6

	Section 9.7..
	Solvency
	7

	Section 10.
	[Reserved]
	7

	Section 11.
	Term of Guaranty
	7

	Section 12.
	Survival of Representation and Warranties; Entire Agreement
	7

	Section 13.
	Amendment and Waiver
	7

	Section 13.1
	Requirements
	7

	Section 13.2
	Solicitation of Holders of Notes
	7

	Section 13.3
	Binding Effect
	8

	Section 13.4
	Notes held by Company, Etc
	8

	Section 14.
	Notices
	8

	Section 15.
	Miscellaneous
	9

i

	
			
	Section 15.1
	Successors and Assigns
	9

	Section 15.2
	Severability
	9

	Section 15.3
	Construction
	9

	Section 15.4
	Further Assurances
	9

	Section 15.5.
	Governing Law
	9

	Section 15.6.
	Jurisdiction and Process; Waiver of Jury Trial
	9

	Section 15.7.
	[Reserved]
	10

	Section 15.8.
	Reproduction of Documents; Execution
	10

ii

General Partner Guaranty Agreement
This General Partner Guaranty Agreement, dated as of February 17, 2017 (this “Guaranty Agreement”), is made by Kilroy Realty Corporation, a Maryland corporation (the “Guarantor”), in favor of the Purchasers (as defined below) and the other holders from time to time of the Notes (as defined below).  The Purchasers and such other holders are herein collectively called the “holders” and individually a “holder.” 
Preliminary statements:
I.    Kilroy Realty, L.P., a Delaware limited partnership (the “Company”), has entered into a Note Purchase Agreement dated September [__], 2016 (as amended, modified, supplemented or restated from time to time, the “Note Purchase Agreement”) with the Persons listed on the signature pages thereto (the “Purchasers”).  Capitalized terms used herein have the meanings specified in the Note Purchase Agreement unless otherwise defined herein.
II.    The Company has authorized the issuance of and, simultaneously with the delivery of this Guaranty Agreement, has issued and sold, pursuant to the Note Purchase Agreement, (a) $175,000,000 aggregate principal amount of the Company’s 3.35% Senior Notes, Series A, due February 17, 2027 (the “Series A Notes”), and (b) $75,000,000 aggregate principal amount of the Company’s 3.45% Senior Notes, Series B, due February 17, 2029 (the “Series B Notes”).  The Series A Notes and the Series B Notes and any other Notes that may from time to time be issued pursuant to the Note Purchase Agreement (including any notes issued in substitution for any of the Notes) are herein collectively called the “Notes” and each individually a “Note.”
III.    It is a condition to the purchase by the Purchasers of the Notes under the Note Purchase Agreement that this Guaranty Agreement shall have been executed and delivered by the Guarantor and shall be in full force and effect.
IV.    The Guarantor is the general partner of the Company and will receive direct and indirect benefits from the financing arrangements contemplated by the Note Purchase Agreement.  The governing body of the Guarantor has determined that the incurrence of such obligations is in the best interests of the Guarantor.
Now Therefore, in order to induce, and in consideration of, the purchase of the Notes by each of the Purchasers, the Guarantor hereby covenants and agrees with, and represents and warrants to each of the holders as follows: 
		
	Section 1.
	Guaranty.

The Guarantor hereby irrevocably and unconditionally guarantees to each holder the due and punctual payment in full of (a) the principal of, Make‐Whole Amount, if any, and interest on (including, without limitation, interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, whether or not a claim for post‐filing or post‐petition interest is allowed in such proceeding), and any other amounts due 

under, the Notes when and as the same shall become due and payable (whether at stated maturity or by required or optional prepayment or by acceleration or otherwise), (b) any other sums which may become due under the terms and provisions of the Notes or the Note Purchase Agreement and (c) the performance of all other obligations of the Company under the Note Purchase Agreement (all such obligations described in clauses (a), (b) and (c) above are herein called the “Guaranteed Obligations”).  The guaranty in the preceding sentence is an absolute, present and continuing guaranty of payment and not of collectibility and is in no way conditional or contingent upon any attempt to collect from the Company or any other guarantor of the Notes or upon any other action, occurrence or circumstance whatsoever.  In the event that the Company shall fail so to pay any of such Guaranteed Obligations when due, the Guarantor agrees to pay the same when due to the holders entitled thereto, without demand, presentment, protest or notice of any kind, in lawful money of the United States of America, pursuant to the requirements for payment specified in the Notes and the Note Purchase Agreement.  Each default in payment of any of the Guaranteed Obligations shall give rise to a separate cause of action hereunder and separate suits may be brought hereunder as each cause of action arises.  The Guarantor agrees that the Notes issued in connection with the Note Purchase Agreement may (but need not) make reference to this Guaranty Agreement.
The Guarantor agrees to pay all reasonable and documented costs and expenses (including reasonable and documented attorneys’ fees of one special counsel for the holders, taken as a whole, and, if reasonably required by the Required Holders, one local counsel in each applicable jurisdiction and/or one specialty counsel in each applicable specialty, for the holders, taken as a whole) incurred by the holders of the Notes in connection with enforcing or defending (or determining whether or how to enforce or defend) the provisions of the Note Purchase Agreement, the Notes and this Guaranty Agreement.
The Guarantor hereby acknowledges and agrees that the Guarantor’s liability hereunder is joint and several with any other Person(s) who may guarantee the obligations and Debt under and in respect of the Notes and the Note Purchase Agreement.
		
	Section 2.
	Obligations Absolute.

The obligations of the Guarantor hereunder shall be primary, absolute, irrevocable and unconditional, irrespective of the validity or enforceability of the Notes or the Note Purchase Agreement, shall not be subject to any counterclaim, setoff, deduction or defense based upon any claim the Guarantor may have against the Company or any holder or otherwise, and shall remain in full force and effect without regard to, and shall not be released, discharged or in any way affected by, any circumstance or condition whatsoever (whether or not the Guarantor shall have any knowledge or notice thereof), including, without limitation: (a) any amendment to, modification of, supplement to or restatement of the Notes or the Note Purchase Agreement (it being agreed that the obligations of the Guarantor hereunder shall apply to the Notes and the Note Purchase Agreement as so amended, modified, supplemented or restated) or any assignment or transfer of any thereof or of any interest therein in accordance with the Note Purchase Agreement, or any furnishing, acceptance or release of any security for the Notes or the addition, substitution or release of any other Person or entity primarily or secondarily liable in respect of the Guaranteed Obligations; (b) any waiver, consent, extension, indulgence or other 

2

action or inaction under or in respect of the Notes or the Note Purchase Agreement; (c) any bankruptcy, insolvency, arrangement, reorganization, readjustment, composition, liquidation or similar proceeding with respect to the Company or its property; (d) any merger, amalgamation or consolidation of the Guarantor or of the Company into or with any other Person or any sale, lease or transfer of any or all of the assets of the Guarantor or of the Company to any Person; (e) any failure on the part of the Company for any reason to comply with or perform any of the terms of any other agreement with the Guarantor; (f) any failure on the part of any holder to obtain, maintain, register or otherwise perfect any security; or (g) any other event or circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor (whether or not similar to the foregoing) other than the indefeasible payment in full in cash of the Guaranteed Obligations, and in any event however material or prejudicial it may be to the Guarantor or to any subrogation, contribution or reimbursement rights the Guarantor may otherwise have.  The Guarantor covenants that its obligations hereunder will not be discharged except by indefeasible payment in full in cash of all of the Guaranteed Obligations and all other obligations hereunder.
		
	Section 3.
	Waiver.

The Guarantor unconditionally waives to the fullest extent permitted by law, (a) notice of acceptance hereof, of any action taken or omitted in reliance hereon and of any default by the Company in the payment of any amounts due under the Notes or the Note Purchase Agreement, and of any of the matters referred to in Section 2 hereof, (b) all notices which may be required by statute, rule of law or otherwise to preserve any of the rights of any holder against the Guarantor, including, without limitation, presentment to or demand for payment from the Company or the Guarantor with respect to any Note, notice to the Company or to the Guarantor of default or protest for nonpayment or dishonor and the filing of claims with a court in the event of the bankruptcy of the Company, (c) any right to require any holder to enforce, assert or exercise any right, power or remedy including, without limitation, any right, power or remedy conferred in the Note Purchase Agreement or the Notes, (d) any requirement for diligence on the part of any holder and (e) any other act or omission or thing or delay in doing any other act or thing which might in any manner or to any extent vary the risk of the Guarantor or otherwise operate as a discharge of the Guarantor or in any manner lessen the obligations of the Guarantor hereunder other than the indefeasible payment in full in cash of the Guaranteed Obligations.
		
	Section 4.
	Obligations Unimpaired.

The Guarantor authorizes the holders, without notice or demand to the Guarantor and without affecting its obligations hereunder, from time to time:  (a) to renew, compromise, extend, accelerate or otherwise change the time for payment of, all or any part of the Notes or the Note Purchase Agreement; (b) to change any of the representations, covenants, events of default or any other terms or conditions of or pertaining to the Notes or the Note Purchase Agreement, including, without limitation, decreases or increases in amounts of principal, rates of interest, the Make‐Whole Amount or any other obligation; (c) to take and hold security for the payment of the Notes or the Note Purchase Agreement, for the performance of this Guaranty Agreement or otherwise for the Debt guaranteed hereby and to exchange, enforce, waive, subordinate and release any such security; (d) to apply any such security and to direct the order or manner of sale thereof as the holders in their sole discretion may determine; (e) to obtain additional or substitute 

3

endorsers or guarantors or release any other Person or entity primarily or secondarily liable in respect of the Guaranteed Obligations; (f) to exercise or refrain from exercising any rights against the Company and others; and (g) to apply any sums, by whomsoever paid or however realized, to the payment of the Guaranteed Obligations and all other obligations owed hereunder.  The holders shall have no obligation to proceed against any additional or substitute endorsers or guarantors or to pursue or exhaust any security provided by the Company, the Guarantor or any other Person or to pursue any other remedy available to the holders.
If an event permitting the acceleration of the maturity of the principal amount of any Notes shall exist and such acceleration shall at such time be prevented or the right of any holder to receive any payment on account of the Guaranteed Obligations shall at such time be delayed or otherwise affected by reason of the pendency against the Company, the Guarantor or any other guarantors of a case or proceeding under a bankruptcy or insolvency law, the Guarantor agrees that, for purposes of this Guaranty Agreement and its obligations hereunder, the maturity of such principal amount shall be deemed to have been accelerated with the same effect as if the holder thereof had accelerated the same in accordance with the terms of the Note Purchase Agreement, and the Guarantor shall forthwith pay such accelerated Guaranteed Obligations.
		
	Section 5.
	Subrogation and Subordination.

(a)    The Guarantor will not exercise any rights which it may have acquired by way of subrogation under this Guaranty Agreement, by any payment made hereunder or otherwise, or accept any payment on account of such subrogation rights, or any rights of reimbursement, contribution or indemnity or any rights or recourse to any security for the Notes or this Guaranty Agreement unless and until all of the Guaranteed Obligations shall have been indefeasibly paid in full in cash.
(b)    The Guarantor hereby subordinates the payment of all Debt and other obligations of the Company or any other guarantor of the Guaranteed Obligations owing to the Guarantor, whether now existing or hereafter arising, including, without limitation, all rights and claims described in clause (a) of this Section 5, to the indefeasible payment in full in cash of all of the Guaranteed Obligations.  If the Required Holders so request, any such Debt or other obligations shall be enforced and performance received by the Guarantor as trustee for the holders and the proceeds thereof shall be paid over to the holders promptly, in the form received (together with any necessary endorsements) to be applied to the Guaranteed Obligations, whether matured or unmatured, as may be directed by the Required Holders, but without reducing or affecting in any manner the liability of the Guarantor under this Guaranty Agreement.
(c)    If any amount or other payment is made to or accepted by the Guarantor in violation of any of the preceding clauses (a) and (b) of this Section 5, such amount shall be deemed to have been paid to the Guarantor for the benefit of, and held in trust for the benefit of, the holders and shall be paid over to the holders promptly, in the form received (together with any necessary endorsements) to be applied to the Guaranteed Obligations, whether matured or unmatured, as may be directed by the Required Holders, but without reducing or affecting in any manner the liability of the Guarantor under this Guaranty Agreement.
    

4

(d)    The Guarantor acknowledges that it is the general partner of the Company and will receive direct and indirect benefits from the financing arrangements contemplated by the Note Purchase Agreement and that its agreements set forth in this Guaranty Agreement (including this Section 5) are knowingly made in contemplation of such benefits.
		
	Section 6.
	Reinstatement of Guaranty.

This Guaranty Agreement shall continue to be effective, or be reinstated, as the case may be, if and to the extent at any time payment, in whole or in part, of any of the sums due to any holder on account of the Guaranteed Obligations is rescinded or must otherwise be restored or returned by a holder upon the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Company or any other guarantors, or upon or as a result of the appointment of a custodian, receiver, trustee or other officer with similar powers with respect to the Company or any other guarantors or any part of its or their property, or otherwise, all as though such payments had not been made.
		
	Section 7.
	Rank of Guaranty.

The Guarantor will ensure that its payment obligations under this Guaranty Agreement will at all times rank at least pari passu, without preference or priority, with all other unsecured and unsubordinated Debt of the Guarantor now or hereafter existing.
		
	Section 8.
	Additional Covenants of the Guarantors.

So long as any Notes are outstanding or the Note Purchase Agreement shall remain in effect, the Guarantor agrees to comply with the covenants and agreements of the Note Purchase Agreement, insofar as such covenants and agreements apply to the Guarantor, as if such covenants and agreements were set forth herein in full.
		
	Section 9.
	Representations and Warranties of the Guarantor.

The Guarantor represents and warrants to each holder as follows:
Section 9.1.    Organization; Power and Authority.  The Guarantor is a corporation, duly organized, validly existing and in good standing under the laws of its jurisdiction of incorporation, and is duly qualified as a foreign corporation and is in good standing in each jurisdiction in which such qualification is required by law, other than those jurisdictions as to which the failure to be so qualified or in good standing could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.  The Guarantor has the corporate power and authority (a) to own or hold under lease the properties it purports to own or hold under lease and to transact the business it transacts and proposes to transact and (b) to execute and deliver this Guaranty Agreement and to perform the provisions hereof and thereof, except in each case referred to in clause (a), to the extent that failure to do so could not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.
    

5

Section 9.2.    Authorization, Etc.  This Guaranty Agreement has been duly authorized by all necessary corporate action on the part of the Guarantor, and this Guaranty Agreement constitutes a legal, valid and binding obligation of the Guarantor enforceable against the Guarantor in accordance with its terms, except as such enforceability may be limited by (a) applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (b) general principles of equity (regardless of whether such enforceability is considered in a proceeding in equity or at law).
Section 9.3.    [Reserved].
Section 9.4.    Compliance with Laws, Other Instruments, Etc.  The execution, delivery and performance by the Guarantor of this Guaranty Agreement will not (i) contravene, result in any breach of, or constitute a default under, or result in the creation of any Lien in respect of, any property of the Guarantor or any of its Subsidiaries under, (x) any indenture, mortgage, deed of trust, loan, purchase or credit agreement or lease, in any material respect, or (y) corporate charter, regulations, by‐laws or shareholders agreement or (z) any other agreement or instrument to which the Guarantor or any Subsidiary of the Guarantor is bound or by which the Guarantor or any Subsidiary of the Guarantor or any of their respective properties may be bound or affected in any material respect, (ii) conflict with or result in a breach of any of the terms, conditions or provisions of any order, judgment, decree or ruling of any court, arbitrator or Governmental Authority applicable to the Guarantor or any Subsidiary of the Guarantor in any material respect or (iii) violate any provision of any statute or other rule or regulation of any Governmental Authority applicable to the Guarantor or any Subsidiary of the Guarantor in any material respect.
Section 9.5.    Governmental Authorizations, Etc. No consent, approval or authorization of, or registration, filing or declaration with, any Governmental Authority is required in connection with the execution, delivery or performance by the Guarantor of this Guaranty Agreement, except for consents, approvals, authorizations, filings and declarations which have been duly obtained, given or made and are in full force and effect.
Section 9.6.    Information Regarding the Company.  The Guarantor now has and will continue to have independent means of obtaining information concerning the affairs, financial condition and business of the Company.  No holder shall have any duty or responsibility to provide the Guarantor with any credit or other information concerning the affairs, financial condition or business of the Company which may come into possession of the holders.  The Guarantor has executed and delivered this Guaranty Agreement without reliance upon any representation by the holders including, without limitation, with respect to (a) the due execution, validity, effectiveness or enforceability of any instrument, document or agreement evidencing or relating to any of the Guaranteed Obligations or any loan or other financial accommodation made or granted to the Company, (b) the validity, genuineness, enforceability, existence, value or sufficiency of any property securing any of the Guaranteed Obligations or the creation, perfection or priority of any lien or security interest in such property or (c) the existence, number, financial condition or creditworthiness of other guarantors or sureties, if any, with respect to any of the Guaranteed Obligations.
    

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Section 9.7.    Solvency.  Upon the execution and delivery hereof, the Guarantor will be solvent, will be able to pay its debts as they mature, and will have capital sufficient to carry on its business.
		
	Section 10.
	[Reserved].

		
	Section 11.
	Term of Guaranty Agreement.

This Guaranty Agreement and all guarantees, covenants and agreements of the Guarantor contained herein shall continue in full force and effect and shall not be discharged until such time as all of the Guaranteed Obligations and all other obligations hereunder shall be indefeasibly paid in full in cash and shall be subject to reinstatement pursuant to Section 6.
		
	Section 12.
	Survival of Representations and Warranties; Entire Agreement.

All representations and warranties contained herein shall survive the execution and delivery of this Guaranty Agreement and may be relied upon by any subsequent holder, regardless of any investigation made at any time by or on behalf of any Purchaser or any other holder.  All statements contained in any certificate or other instrument delivered by or on behalf of the Guarantor pursuant to this Guaranty Agreement shall be deemed representations and warranties of the Guarantor under this Guaranty Agreement.  Subject to the preceding sentence, this Guaranty Agreement embodies the entire agreement and understanding between each holder and the Guarantor and supersedes all prior agreements and understandings relating to the subject matter hereof.
		
	Section 13.
	Amendment and Waiver.

Section 13.1.    Requirements.  This Guaranty Agreement may be amended, and the observance of any term hereof may be waived (either retroactively or prospectively), with (and only with) the written consent of the Guarantor and the Required Holders, except that no amendment or waiver which results in the limitation of the liability of the Guarantor hereunder will be effective as to any holder unless consented to by such holder in writing.
Section 13.2.    Solicitation of Holders of Notes.
(a)    Solicitation.  The Guarantor will provide each holder of the Notes (irrespective of the amount of Notes then owned by it) with sufficient information, sufficiently far in advance of the date a decision is required, to enable such holder to make an informed and considered decision with respect to any proposed amendment, waiver or consent in respect of any of the provisions hereof.  The Guarantor will deliver executed or true and correct copies of each amendment, waiver or consent effected pursuant to the provisions of this Section 13.2 to each holder promptly following the date on which it is executed and delivered by, or receives the consent or approval of, the requisite holders of Notes.
    

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(b)    Payment.  The Guarantor will not directly or indirectly pay or cause to be paid any remuneration, whether by way of supplemental or additional interest, fee or otherwise, or grant any security or provide other credit support, to any holder as consideration for or as an inducement to the entering into by any holder of any waiver or amendment of any of the terms and provisions hereof unless such remuneration is concurrently paid, or security is concurrently granted or other credit support concurrently provided, on the same terms, ratably to each holder even if such holder did not consent to such waiver or amendment.
(c)    Consent in Contemplation of Transfer.  Any consent made pursuant to this Section 13 by a holder that has transferred or has agreed to transfer its Notes to the Company, any Subsidiary or any Affiliate (including the Guarantor) of the Company and has provided or has agreed to provide such written consent as a condition to such transfer shall be void and of no force or effect except solely as to such holder, and any amendments effected or waivers granted or to be effected or granted that would not have been or would not be so effected or granted but for such consent (and the consents of all other holders of Notes that were acquired under the same or similar conditions) shall be void and of no force or effect except solely as to such holder.
Section 13.3.    Binding Effect.  Any amendment or waiver consented to as provided in this Section 13 applies equally to all holders and is binding upon them and upon each future holder and upon the Guarantor without regard to whether any Note has been marked to indicate such amendment or waiver.  No such amendment or waiver will extend to or affect any obligation, covenant or agreement not expressly amended or waived or impair any right consequent thereon.  No course of dealing between the Guarantor and the holder nor any delay in exercising any rights hereunder or under any Note shall operate as a waiver of any rights of any holder.  As used herein, the term “this Guaranty Agreement” and references thereto shall mean this Guaranty Agreement as it may be amended, modified, supplemented or restated from time to time.
Section 13.4.    Notes Held by Company, Etc.  Solely for the purpose of determining whether the holders of the requisite percentage of the aggregate principal amount of Notes then outstanding approved or consented to any amendment, waiver or consent to be given under this Guaranty Agreement, or have directed the taking of any action provided herein to be taken upon the direction of the holders of a specified percentage of the aggregate principal amount of Notes then outstanding, Notes directly or indirectly owned by the Guarantor, the Company or any of their respective Affiliates shall be deemed not to be outstanding.
		
	Section 14.
	Notices.

All notices and communications provided for hereunder shall be in writing and sent (a) by telecopy if the sender on the same day sends a confirming copy of such notice by a recognized overnight delivery service (charges prepaid), or (b) by registered or certified mail with return receipt requested (postage prepaid), or (c) by a recognized overnight delivery service (with charges prepaid).  Any such notice must be sent:
(a)    if to the Guarantor, to in care of the Company at the Company’s address set forth in the Note Purchase Agreement, or such other address as the Guarantor shall have specified to the holders in writing, or

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(b)    if to any holder, to such holder at the addresses specified for such communications set forth in the Purchaser Schedule to the Note Purchase Agreement, or such other address as such holder shall have specified to the Guarantor in writing.
		
	Section 15.
	Miscellaneous.

Section 15.1.    Successors and Assigns.  All covenants and other agreements contained in this Guaranty Agreement by or on behalf of any of the parties hereto bind and inure to the benefit of their respective successors and assigns whether so expressed or not.
Section 15.2.    Severability.  Any provision of this Guaranty Agreement that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall (to the full extent permitted by law), not invalidate or render unenforceable such provision in any other jurisdiction.
Section 15.3.    Construction.  Each covenant contained herein shall be construed (absent express provision to the contrary) as being independent of each other covenant contained herein, so that compliance with any one covenant shall not (absent such express contrary provision) be deemed to excuse compliance with any other covenant.  Whether any provision herein refers to action to be taken by any Person, or which such Person is prohibited from taking, such provision shall be applicable whether such action is taken directly or indirectly by such Person.
The section and subsection headings in this Guaranty Agreement are for convenience of reference only and shall neither be deemed to be a part of this Guaranty Agreement nor modify, define, expand or limit any of the terms or provisions hereof.  All references herein to numbered sections, unless otherwise indicated, are to sections of this Guaranty Agreement.  Words and definitions in the singular shall be read and construed as though in the plural and vice versa, and words in the masculine, neuter or feminine gender shall be read and construed as though in either of the other genders where the context so requires.
Section 15.4.    Further Assurances.  The Guarantor agrees to execute and deliver all such instruments and take all such action as the Required Holders may from time to time reasonably request in order to effectuate fully the purposes of this Guaranty Agreement.
Section 15.5.    Governing Law.  This Guaranty Agreement shall be construed and enforced in accordance with, and the rights of the parties shall be governed by, the law of the State of New York, excluding choice‐of‐law principles of the law of such State that would permit the application of the law of a jurisdiction other than such State.
Section 15.6.    Jurisdiction and Process; Waiver of Jury Trial.  (a) The Guarantor irrevocably submits to the non‐exclusive jurisdiction of any New York State or federal court sitting in the Borough of Manhattan, The City of New York, over any suit, action or proceeding arising out of or relating to this Guaranty Agreement.  To the fullest extent permitted by applicable law, the Guarantor irrevocably waives and agrees not to assert, by way of motion, as a defense or otherwise, any claim that it is not subject to the jurisdiction of any such court, any 

9

objection that it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in any such court and any claim that any such suit, action or proceeding brought in any such court has been brought in an inconvenient forum.
(b)    The Guarantor agrees, to the fullest extent permitted by applicable law, that a final judgment in any suit, action or proceeding of the nature referred to in Section 15.6(a) brought in any such court shall be conclusive and binding upon it subject to rights of appeal, as the case may be, and may be enforced in the courts of the United States of America or the State of New York (or any other courts to the jurisdiction of which it or any of its assets is or may be subject) by a suit upon such judgment.
(c)    The Guarantor consents to process being served by or on behalf of any holder in any suit, action or proceeding of the nature referred to in Section 15.6(a) by mailing a copy thereof by registered or certified mail (or any substantially similar form of mail), postage prepaid, return receipt requested, to it at its address specified in Section 14 or at such other address of which such holder shall then have been notified pursuant to Section 14.  The Guarantor agrees that such service upon receipt (i) shall be deemed in every respect effective service of process upon it in any such suit, action or proceeding and (ii) shall, to the fullest extent permitted by applicable law, be taken and held to be valid personal service upon and personal delivery to it.  Notices hereunder shall be conclusively presumed received as evidenced by a delivery receipt furnished by the United States Postal Service or any reputable commercial delivery service.
(d)    Nothing in this Section 15.6 shall affect the right of any holder to serve process in any manner permitted by law, or limit any right that the holders may have to bring proceedings against the Guarantor in the courts of any appropriate jurisdiction or to enforce in any lawful manner a judgment obtained in one jurisdiction in any other jurisdiction.
(e)    The Guarantor and the Holders hereby waive trial by jury in any action brought on or with respect to this Guaranty Agreement or other document executed in connection herewith.
Section 15.7.    [Reserved].
Section 15.8.    Reproduction of Documents; Execution.  This Guaranty Agreement may be reproduced by any holder by any photographic, photostatic, electronic, digital, or other similar process and such holder may destroy any original document so reproduced.  The Guarantor agrees and stipulates that, to the extent permitted by applicable law, any such reproduction shall be admissible in evidence as the original itself in any judicial or administrative proceeding (whether or not the original is in existence and whether or not such reproduction was made by such holder in the regular course of business) and any enlargement, facsimile or further reproduction of such reproduction shall likewise be admissible in evidence.  This Section 15.8 shall not prohibit the Guarantor or any other holder of Notes from contesting any such reproduction to the same extent that it could contest the original, or from introducing evidence to demonstrate the inaccuracy of any such reproduction.  A facsimile or electronic transmission of the signature page of the Guarantor shall be as effective as delivery of a manually executed counterpart hereof and shall be admissible into evidence for all purposes.

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In Witness Whereof, the Guarantor has caused this Guaranty Agreement to be duly executed and delivered as of the date and year first above written.

	
							
	 
	 
	 
	Kilroy Realty Corporation, a Maryland corporation
	 

	 
	 
	 
	 
	 

	 
	 
	 
	 
	 

	 
	 
	 
	By:
	 
	 
	 

	 
	 
	 
	 
	 
	Name:
Title: 

	 

	 
	 
	 
	 
	 
	 
	 

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