Document:

Exhibit

Exhibit 10.7
MANAGEMENT AGREEMENT
This PROPERTY MANAGEMENT AGREEMENT (this “Agreement”) is made and entered into as of December 8, 2016, by and between WHITESTONE TRS, INC. (the “Manager”) and _______________, a ______________ (“Owner”).
RECITALS
WHEREAS, Owner owns that certain property identified on Schedule 1 (the “Property”); and
WHEREAS, Owner desires to engage, and delegate certain duties to, the Manager to provide the property management, asset management and other services with respect to the Property, and the Manager desires to accept such delegation and perform such property management, asset management and other services with respect to the Property.
NOW, THEREFORE, in consideration of the mutual covenants and obligations set forth herein and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending legally to be bound, hereby agree as follows:
AGREEMENT
1.Defined Terms.  As used herein, the following terms shall have the meanings set forth below:
“Affiliate” means, with respect to any specified Person, any other Person that directly or indirectly, through one or more intermediaries, Controls, is Controlled by, or is under common Control with, the Person specified.  
“Agreement” has the meaning set forth in the preamble.
“Asset Management Fee” has the meaning set forth in Section 5.
“Business Day” means any day other than (a) Saturday and Sunday in the United States, and (b) any other day on which banks located in the United States are required or authorized by law to remain closed.
“Cause Event” means, with respect to any Person, any event, conduct or condition by or with respect to such Person that constitutes Misconduct and that results in a material adverse effect on the Property or the Owner.
“Claims” means claims, demands, Proceedings, liabilities, out-of-pocket costs and expenses, damages and losses, of whatever nature, known or unknown, liquidated or unliquidated, including amounts paid in satisfaction of judgments, in compromise or as fines or penalties, and reasonable counsel fees and expenses incurred in connection with the preparation for or defense or disposition of any Proceeding.

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“Code” means the Internal Revenue Code of 1986, as amended, and any successor law.
“Control”, “Controls”, “Controlling” or “Controlled” means in the case of any Person, the possession, directly or indirectly, of the power to direct or cause the direction of the management, policies and/or decision making of such Person, whether through the ownership of voting securities, by contract, operation of law or otherwise.
“Covered Person” means the Manager, each current or former shareholder, officer, trustee, employee, partner, member, manager, agent and other Representative of the Manager, and each of their Controlling Affiliates.
“Damages” has the meaning set forth in Section 7(b).
“GAV” means, with respect to the Property, the purchase price of the Property, based upon the purchase price allocations determined between the Pillarstone Capital REIT Operating Partnership, L.P. (“Pillarstone OP”), Whitestone REIT Operating Partnership, L.P. and the other parties thereto pursuant to that certain Contribution Agreement dated of even date herewith, excluding all indebtedness, liabilities or claims of any nature.
“Governmental Authorities” means any and all federal, regional, city, town, municipal or local governmental or quasi-governmental board, agency, authority, department or body having jurisdiction over the Property and/or the development, management, operation, maintenance or repair thereof.
“Lease” means any lease, license, letting, concession, or occupancy agreement, to which Owner is a party, (whether written or oral and whether now or hereafter in effect) under which an Owner is a lessor, sublessor, or licensor existing as of the date hereof or thereafter entered into by Owner, in each case pursuant to which any Person is granted a possessory interest in, or right to use or occupy, all or any portion of any space in any of the Property, including any billboard, signage, cellular antenna or other communications leases, and every modification or amendment thereof, and every guarantee of the performance and observance of the covenants, conditions and agreements to be performed and observed by the other party thereto.
“Manager” has the meaning set forth in the preamble.
 “Misconduct” means an act or omission relating to Manager’s provisions of services under this Agreement to Owner, which constitutes or rises to the level of fraud, criminal conduct, willful misconduct or gross negligence, or a willful breach of this Agreement. Notwithstanding the foregoing, if it is determined that Misconduct has occurred other than in the case of fraud, then the Manager shall have at least thirty (30) days (or such longer period as is reasonable if good faith efforts to cure such Misconduct are in progress), to cure such Misconduct. 
“Notice” has the meaning set forth in Section 12(b).
“Owner” has the meanings set forth in the preamble.
“Party” means each of Owner and the Manager, and “Parties” means all of them.

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“Person” means any individual or entity, including any private or public real estate operating company or REIT, exempted company, exempted limited partnership, private limited company, corporation, partnership, limited partnership, limited liability company, trust, charitable trust or other legal entity, whether organized in the United States or another jurisdiction, or any unincorporated association, government or governmental agency or authority.
“Proceeding” means, any legal dispute, investigation, action, suit, arbitration or other proceeding, whether civil or criminal, judicial, administrative, investigative or otherwise.
“Property” has the meaning set forth in the Recitals.
“Property Management Fee” has the meaning set forth in Section 5.
“REIT” means any entity qualifying for treatment as a “real estate investment trust” under Sections 856 through 860 of the Code.
“Relevant Documents” means all documents and agreements entered into by Owner relating to its business (including any financing documents).
“Representatives” means, with respect to any Person, any of such Person’s Affiliates, managers, partners, shareholders, members, trustees, officers, employees, agents, counsel, advisors, directors, contractors, engineers, administrators, service providers and similar representatives.  
“Revenues” means all rents, rent equivalents, Termination Fees, royalties (excluding all oil and gas or other mineral royalties and bonuses), income, receipts, charges for services rendered, and other consideration from the Property of whatever form or nature received by or paid to or for the account of or benefit of Owner from any and all Leases and proceeds, if any, from business interruption or other loss of income insurance, but specifically excluding (A) any income from investment of cash, (B) security deposits (C) advance rentals, (D) payments in the nature of indemnification or compensation for loss, damage or liability sustained, (E) all purchase discounts, (F) any sums which under normal accounting practice are attributable to capital, (G) proceeds received in respect of a condemnation or conveyance in lieu thereof, including all insurance proceeds except for business interruption proceeds, (H) collections of amounts due from tenants for balances due for periods prior to the date of this Agreement.
“Services” has the meaning set forth in Section 2(a).
“Service Providers” means all licensed brokerage firms, and such other professionals, consultants, leasing agents and vendors as are customary and appropriate for the specific function being delegated as determined by Manager in its reasonable discretion from time to time.
“Subsidiaries” means, with respect to any Person, any other Person that is least 50% owned, or controlled directly or indirectly, by such Person.
“Tenant” means any Person liable by contract or otherwise to pay monies (including a percentage of gross income, revenue or profits) pursuant to a Lease.

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“Termination Fee” means any payment, fee, or penalty paid to Owner in connection with termination of any Lease, in whole or in part, less any fees incurred by Owner in negotiating, collecting or receiving such payment, fee or penalty.
2.Provision of Services.  
(a)Services.  The Manager shall provide property management, leasing and day-to-day advisory and administrative services to Owner and with respect to the Property as set forth in Exhibit A hereto and incorporated herein by reference and as otherwise set forth in this Agreement (collectively, the “Services”).
(b)Delegation.  Owner hereby delegates to the Manager all rights and duties to provide the Services with respect to the Property and Owner, and the Manager hereby accepts such delegation.  The Manager may delegate (i) any or all property management and similar services to be provided to Owner, (ii) all listing brokerage or similar services to such qualified and licensed brokerage firms as Manager selects in its reasonable discretion, and (iii) such other services to such other professionals, consultants, and vendors as are customarily performed by third parties of similarly situated properties and appropriate for the specific function being delegated as determined by Manager in its reasonable discretion from time to time.  All contracts with Service Providers shall be terminable, without penalty or fee, upon not more than thirty (30) days’ notice. 
(c)Service Providers.  So long as the Manager selects Service Providers with reasonable care, and except for any Misconduct related to Manager’s selection and supervision of the Service Providers, the Manager shall not be liable for any acts, deeds or omissions by any Service Provider selected by the Manager with reasonable care.  Manager agrees to use its commercially reasonable efforts to cause to be included in all contracts with Service Providers provisions limiting Owner’s liability to its interest in the Property, insurance requirements and shall include an indemnification from the Service Provider’s in favor of Owner whereby the Service Provider agrees to indemnify, defend and hold Owner (and Owner’s Affiliates and direct and indirect members, managers, partners, directors, shareholders, officers, employees and agents) harmless from and against all claims, actions, suits, proceedings, losses, damages, liabilities, costs and expenses (including without limitation, reasonable attorneys' fees and disbursements) arising out of, resulting from or in connection with the acts or omissions of the Service Provider and its directors, officers, employees, contractors, subcontractors and agents, which constitute negligence, fraud, breach of the service agreement, breach of fiduciary duty, willful, reckless or criminal misconduct or any actions of the service provider beyond the scope of authority conferred upon the Service Provider pursuant to the terms of the applicable contract.  All contracts, including any contracts with Manager’s Affiliates, shall be at competitive rates for similarly situated projects.
3.Covenants.
(a)    It is the express intention of the Parties that the Manager perform the Services as an independent contractor to Owner, and nothing contained in this Agreement shall be construed to (i) constitute the Manager and Owner as partners, joint venturers, co-owners or otherwise as participants in a joint or common undertaking or (ii) save as expressly provided in this Agreement, confer on the Manager any express, implied or apparent authority to incur any obligation or liability on behalf of Owner.

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(b)    The Manager agrees that it will employ at all times an adequate number of employees and staff of professionals employed by the Manager as is reasonably necessary to provide the Services.  Except as otherwise set forth herein, the Manager shall be solely responsible for its management and operating decisions, including any employment and interviewing decisions.  The Manager’s employees are not and will not be employees of Owner.  The Manager will be responsible at all times for its employees who perform services at the Property.  Manager has performed or shall perform customary background checks with respect to its employees that provide Services hereunder consistent with the Manager’s past practices.
(c)    The Manager agrees to perform the Services on the terms and conditions set forth herein in accordance with applicable law and regulation.  Manager will be responsible for compliance in all material respects with all terms and conditions contained in any ground lease, Leases or Relevant Documents to the extent Manager has been provided or otherwise has copies of such instruments; provided, however, that Manager shall not be responsible for any failure to comply that is the result of any actions or omissions undertaken by the Owner or its Affiliates (other than Manager).  During the term of this Agreement, the Manager shall maintain all licenses, permits, registrations and exemptions required under applicable law in order for the Manager to perform the Services and the management and operation of the Property.
(d)    So long as Pillarstone Capital REIT (“Pillarstone”), the general partner of Pillarstone OP, or any other direct or indirect partner of Pillarstone OP intends to be taxed as a REIT, the Manager shall at all times use its commercially reasonable efforts to manage the income, assets and operations of the Owner, and the Property, such that Owner’s gross revenue derived from the Property (as determined pursuant to Sections 856(c)(2) and (3) of the Code) and Owner’s assets (as determined pursuant to Sections 856(c)(4) and (5) of the Code) would permit Pillarstone or any other direct or indirect partner of Pillarstone OP to qualify as a REIT as if the Property was its only asset and would avoid causing Pillarstone or any other direct or indirect partner of Pillarstone OP to incur any tax on prohibited transactions under Section 857(b)(6) of the Code and any tax on redetermined rents, redetermined deductions, and excess interest under Section 857(b)(7) of the Code; provided that the Manager shall not be responsible for a failure to comply with the foregoing to the extent that such failure is attributable to (1) any limitation on the Manager’s authority hereunder to cause such compliance, (2) any acts or omissions of Owner in violation of the agreement pursuant to which the Manager engaged Owner, or (3) any action, deed, inaction or omission by Pillarstone, Pillarstone OP, the Owner or any of its Affiliates (other than Manager).
4.Representations and Warranties.  (A)  The Manager represents and warrants to Owner that, as of the date hereof:
(a)    it is duly organized and validly existing under the laws of _________ and has the requisite power and authority to enter into and to perform its obligations under this Agreement;
(b)    its execution, delivery and performance of this Agreement has been duly authorized, and does not and will not (i) violate any law, rule, regulation, order, or decree applicable to it, (ii) violate its organizational documents, (iii) conflict with any agreement, mortgage, bond or other instrument or treaty to which it is a party or which is binding upon it or any of its assets or (iv) give rise or be subject to any claims which may have the effect of preventing, delaying, making illegal or otherwise interfering with this Agreement;

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(c)    this Agreement constitutes a legal and binding obligation, enforceable against it in accordance with its terms;
(d)    there is no litigation pending or threatened to which it is a party that, if adversely determined, would have a material adverse effect on the transaction contemplated in this Agreement or on its financial condition, prospects, or business; 
(e)    it is duly qualified to do business in each jurisdiction in which it conducts its business and has obtained material licenses, approvals and exemptions required to provide the Services; and
(f)    it has the necessary personnel and facilities, as well as adequate and proper internal control systems, to perform its obligations under this Agreement.
(B)     Owner hereby represents and warrants to the Manager that, as of the date hereof:
(a)    it is duly organized and validly existing under the laws of its jurisdiction of organization and has the requisite power and authority to enter into and to perform its obligations under this Agreement;
(b)    its execution, delivery and performance of this Agreement has been duly authorized, and does not and will not (i) violate any law, rule, regulation, order, or decree applicable to it, (ii) violate its organizational documents, (iii) conflict with any agreement, mortgage, bond or other instrument or treaty to which it is a party or which is binding upon it or any of its assets or (iv) give rise or be subject to any claims which may have the effect of preventing, delaying, making illegal or otherwise interfering with this Agreement;
(c)    this Agreement constitutes a legal and binding obligation, enforceable against it in accordance with its terms;
(d)    there is no litigation pending or threatened to which it is a party that, if adversely determined, would have a material adverse effect on the transaction contemplated in this Agreement or on its financial condition, prospects, or business; and
(e)    it is duly qualified to do business in each jurisdiction in which it conducts its business and has obtained material licenses, approvals and exemptions required to own and operate the Property that it owns.
5.Fees.
(a)    Property Management Fee.  As compensation for the Services, Owner shall pay to the Manager, on a monthly basis in arrears, a management fee (the “Property Management Fee”) equal to [5.0%] [3.0%] of monthly Revenues.  The monthly Property Management Fees shall be prorated for periods less than a full calendar month based on the Revenues during such month.  
(b)    Asset Management Fee.  As compensation for performing certain of the Services, Owner shall pay to the Manager, on a monthly basis in arrears, an asset management fee equal to 0.125% of GAV as of the end of each month (the “Asset Management Fee”).  The 

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Asset Management Fee shall be prorated for periods less than a full calendar month based on the portion of the month in the term of this Agreement, and payable promptly (no later than fifteen (15) days) following the Owner’s receipt of an invoice setting forth the amount due for such month.    
(c)    Leasing Commissions / Construction Management Fees.  In connection with any new tenant leases, lease renewals, modifications, or expansions, and/or construction management services provided by the Manager and/or its Affiliates with respect to the Property or Owner which are not delegated to and provided by other Service Providers, the Manager or such Affiliates shall be entitled to receive and retain lease commissions and/or construction management fees.  In no event shall such commissions and fees exceed, in the aggregate, the commissions and fees that would have been charged by qualified third parties to provide comparable services in the markets in which the Property is located.
6.Costs and Expenses.  The Manager will bear the ordinary course operating expenses incidental to the provision of the day to day administrative services under this Agreement, including the cost of its own overhead, salaries and benefits provided to employees, communications and similar expenses.  All other costs, expenses and liabilities incurred in connection with the operation of the Property shall be borne by the Owner, including fees, costs and expenses related to the due diligence, purchase, financing, holding and sale of Property (to the extent not reimbursed), any related credit facility, taxes, insurance, fees and expenses of accountants, auditors and counsel, litigation expenses, and other extraordinary expenses.  Manager shall prepare an estimated annual budget (the “Budget”) for the Property (x) within thirty (30) days of the date of this Agreement for the immediately following calendar year and (y) on or before December 15th for each following calendar year thereafter, showing estimated revenues and expenses for the Property on a monthly basis.  The estimated revenue portion of the Budget will include a leasing plan, including rental rates, expected renewals, and premises to be leased during the following calendar year; monthly occupancy percentages; and recovery of operating expenses.  The estimated expense portion of the Budget will include monthly expenses in detail for property operations, utilities, insurance, and real estate taxes. No fee or reimbursement of expenses otherwise owed to the Manager hereunder shall be subject in any manner to compliance with or meeting targets or estimates in the Budget. 
7.Covered Person Liability; Indemnification.
(a)    Liability.  No Covered Person shall be liable to Owner, and Owner does hereby release such Covered Person, for any act or omission, including any mistake of fact or error in judgment, taken, suffered or made by such Covered Person, unless such act or omission constitutes Misconduct by such Covered Person.  The provisions of this Agreement, to the extent that they restrict or eliminate the duties and liabilities of a Covered Person otherwise existing at law or in equity, are (to the fullest extent permitted by law) agreed by the Parties to replace such other duties and liabilities of such Covered Person.  A Covered Person shall incur no liability in acting in good faith upon any signature or writing reasonably believed by such Covered Person to be genuine, may rely on a certificate signed by an executive officer of any Person in order to ascertain any fact with respect to such Person or within such Person’s knowledge, and may rely on an opinion of outside counsel reasonably selected by such Covered Person with respect to legal matters.  Each Covered Person may consult with counsel, appraisers, engineers, accountants and other professionals reasonably selected by such Covered Person and, except to the extent any such reliance constitutes Misconduct, shall not be liable for anything done, suffered or 

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omitted in good faith in reasonable reliance upon the advice of any of such Persons.  No Covered Person shall be liable to Owner for any error of judgment made reasonably and in good faith by an officer or employee of such Covered Person unless such error constitutes Misconduct by or with respect to such Covered Person.  
(b)    Indemnification Generally.  Owner shall to the fullest extent permitted by applicable law, indemnify and hold harmless each Covered Person from and against any and all Claims that may accrue to or be incurred by any Covered Person relating to or arising out of (i) the management, operation or repair of such Property under this Agreement arising after the date of this Agreement, and/or (ii) the performance by the Manager of the Manager’s duties and obligations hereunder, or otherwise relating to or arising out of this Agreement (collectively, “Damages”), except in each instance above to the extent that such Damages result from Misconduct by or with respect to any Covered Person.  The termination of any Proceeding by settlement shall not, of itself, create a presumption that any Damages relating to such settlement or otherwise relating to such Proceeding arose primarily from Misconduct by or with respect to the Manager, any Affiliate of the Manager and/or any Covered Person.  Any Covered Person entitled to seek indemnification shall use reasonable efforts to seek indemnification from other available sources, if any, prior to obtaining indemnification. 
(c)    Indemnification by Manager.  Manager shall indemnify and hold Owner harmless from and against all Claims which arise out of or are a result of the Misconduct of any Covered Person.  If any such Claims result in liability to Owner or Owner Indemnified Parties, Manager shall reimburse Owner Indemnified Parties for any attorneys’ fees and costs actually and reasonably incurred by Owner to defend the portion or portions of such Claims against Owner which arise out of or are a result of Misconduct by any Covered Person.  In no event shall Manager’s liability under this Section 7(c) or otherwise under this Agreement exceed the amount of fees owing hereunder for a two (2) year period.
(d)    Notice of Claims.  Promptly after receipt by a Covered Person of its knowledge of a Claim or notice of the commencement of any Proceeding, such Covered Person shall, if a claim for indemnification in respect thereof is to be made against Owner, give written notice to the Owner of such Claim or the commencement of such Proceeding, provided that the failure of any Covered Person to give such notice as provided herein shall not relieve Owner of its obligations under this Section 7 except to the extent that Owner is actually prejudiced by such failure to give such notice.  If any such Proceeding is brought against a Covered Person, will be entitled to participate in and assume the defense thereof to the extent that it may wish, at its sole cost and expense, with counsel reasonably satisfactory to such Covered Person.  
(e)    Rights Cumulative.  The right of the Parties to the indemnification provided herein shall be cumulative with, and in addition to, any and all rights to which such Party may otherwise be entitled by contract or as a matter of law or equity and shall extend to such Party’s successors, assigns, heirs and legal representatives.
(f)    Survival.  The indemnities set forth above shall survive the expiration or termination of this Agreement.

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8.Term; Defaults; Remedies and Termination.
(a)Term.  This Agreement shall become effective on the date hereof and shall remain in full force and effect until December 31, 2018; provided, that this Agreement may be terminated by the Manager or Owner effective as of any date after December 31, 2017 upon not less than thirty (30) days prior written notice to the other Party.  Unless otherwise terminated pursuant to the provisions hereof, the term of this Agreement shall automatically renew on a month to month basis at the end of the term unless either of the Parties has notified the other in writing not less than thirty (30) days prior to the expiration of the term, as the same may be extended.
(b)Default by Manager.  Manager shall be deemed to be in default hereunder upon the happening of any of the following:
		
	(1)
	The making of a general assignment by Manager for benefit of its creditors, the filing by Manager with any bankruptcy court of competent jurisdiction of a voluntary petition under Title 11 of U.S. Code, as amended from time to time, the filing by Manager of any petition or answer seeking any reorganization, arrangement, composition, readjustment, liquidation, dissolution, or similar relief under any present or future federal or state act or law relating to bankruptcy, insolvency, or other relief for debtors, Manager being the subject of any order for relief issued under such Title 11 of the U.S. Code, as amended from time to time, or the dissolution or liquidation of Manager; and

		
	(2)
	Misconduct of Manager hereunder.

(c)Remedies of Owner.  Upon the occurrence of an event of default by Manager as specified herein after expiration of any applicable notice and cure periods expressly provided for in this Agreement, Owner’s remedies under this Agreement shall be limited to the indemnification set forth under Section 7(c) hereof.
(d)Default by Owner.  Owner shall be in default hereunder in the event Owner shall fail to keep, observe or perform any material covenant, agreement, term or provision of this Agreement to be kept, observed or performed by Owner and such default is not cured within ten (10) days after written notice is received by Owner alleging such default; provided however, if the default, by its nature, is not susceptible of being cured within such ten (10) day period, the time shall be extended for up to thirty (30) additional days if Owner commenced to cure the default within the ten (10) day period and diligently pursues the curative efforts thereafter.
(e)Remedies of Manager.  Upon the occurrence of an event of default by Owner as specified herein after expiration of any applicable notice and cure periods expressly provided for in this Agreement, Manager shall, as its sole and exclusive remedy, be entitled to terminate this Agreement and pursue an action for actual, out-of-pocket damages against Owner.  Any provision of this Agreement to the contrary notwithstanding, Manager hereby agrees that no personal, partnership or corporate liability of any kind or character (including, without limitation, the payment of any judgment) whatsoever now attaches or at an time hereafter under any condition shall attach to Owner’s current or former shareholders, officers, trustees, employees, partners, members, managers, agents and other representatives of constituent  

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entities, and affiliates (the “Owner Indemnified Parties”) for payment of any amount payable under this Agreement or for the performance of any obligation under this Agreement.  The exclusive remedies of Manager for the failure of the Owner to perform any of its obligations under this Agreement shall be to proceed against the Owner or the interest of Owner in and to the Property for Manager's actual damages, and no Owner Indemnified Parties shall be personally liable for any deficiency.  
(f)Post Termination Obligations.  In the event this Agreement is terminated (i) the Manager shall deliver to Owner or, if directed by Owner, any replacement property manager, copies of all books of account, records, registers, correspondence and documents relating to Owner and the Property in the possession of or under the control of the Manager which relates to performance of the Services, but not including such proprietary items as relate solely to the business affairs of the Manager, (ii) each Party shall retain any liabilities or obligations to the other Parties pursuant to any indemnification provisions contained herein all of which will survive termination of this Agreement, (iii) Owner shall continue to be responsible for reimbursing the Manager for costs, charges or expenses, and paying any amounts otherwise due, owing or accrued through the date of termination of this Agreement, to the extent required by this Agreement.  If this Agreement is terminated in connection with the removal of the Manager due to a Cause Event, the Manager shall no longer be entitled to any further payments of Property Management Fees, Asset Management Fee or other fees or commissions in accordance with Section 5.
9.Disputes.
(a)    Remedies.
(i)    In General.  Except as otherwise specifically prohibited herein, any Party will be entitled to enforce any rights specifically to recover damages caused by reason of any breach of any provision of this Agreement and to exercise all other rights at law and in equity.
(ii)    No Punitive Damages.  No party shall be entitled to  damages in excess of compensatory damages, and each Party hereby irrevocably waives any right to recover punitive, exemplary or similar damages with respect to any dispute.
10.Applicable Law.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES AND ANY DISPUTES HEREUNDER SHALL BE GOVERNED BY AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF TEXAS, UNITED STATES OF AMERICA, WITHOUT REGARD TO CONFLICT OF LAWS PRINCIPLES THAT WOULD CAUSE THE APPLICATION OF OTHER OR DIFFERENT LAWS.
11.Waiver of Jury Trial.  TO THE EXTENT PERMITTED BY APPLICABLE LAW, THE PARTIES HEREBY IRREVOCABLY WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
12.Insurance.  During the term of this Agreement, Manager shall, at its expense, maintain the following insurance coverages in place and in full force and effect:

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a.    Liability.  Comprehensive commercial general liability insurance, including broad form property damage, blanket contractual and personal injury (including death resulting therefrom) with a combined single limit of $1,000,000.00 for each occurrence and not less than $2,000,000.00 per annum aggregate, and excess liability insurance in the minimum amount of $10,000,000.00 which shall be in excess of the primary coverages set forth above.
b.    Auto (Owned and Hired).  Comprehensive automobile liability insurance on a standard form written to cover all owned, hired and non-owned automobiles, endorsed to include Owner and Owner Indemnified Parties as an additional insured, state that the insurance is "primary" coverage, in an amount of not less than $1,000,000.00 per person or occurrence for bodily injury and $1,000,000.00 per occurrence for property damage.
c.    Worker's Compensation Insurance.  Worker's Compensation and employee liability insurance in not less than the applicable statutory amounts.
d.    Professional Liability or Errors and Omissions Insurance.  Professional liability policy or Errors and Omissions Insurance in an amount of not less than $2,000,000.00 per claim, written on a claims made basis.  Deductibles under such policy may not exceed $25,000.00 per claim.
e.    Owner Additional Insured.  Owner and the Owner Indemnified Parties shall be named as an additional insured on all policies of insurance, not later than the date of this Agreement, copies of policies, certificates of insurance or other proof evidencing such required insurance coverage, together with all required exclusions and endorsements, including but not limited to an endorsement that Owner will be given at least thirty (30) days' prior written notice of cancellation or any material change in coverage. In cases where Owner and Manager maintain insurance policies that duplicate coverage, including but not limited to general liability and excess coverage, Manager's policies will provide primary coverage.  Coverage may be provided by Manager’s master insurance program.
f.    “Master Insurance Programs” Insurance.  During the term of this Agreement, Owner, at its expense, shall maintain the following insurance coverages in place and in full force and effect: (a) property damage insurance, including builder's risk insurance, where applicable, to cover "all risk of physical loss" or damage to the Property  from fire and extended coverage perils, including vandalism, riot and civil commotion, burglary, theft and malicious mischief, in an amount determined by Owner in its sole discretion; and (b) comprehensive commercial general liability insurance, covering third-party bodily injury, property damage and personal injury.  All such insurance will be in such amounts and with such insurers as Owner may reasonably determine. 
13.Miscellaneous.
(a)    Amendments.  The terms and provisions of this Agreement may not be amended without the prior written consent of all of the Parties.  Manager agrees to amend this Agreement as may be reasonably required by any lender of Owner; provided that Manager shall 

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not be required to amend Section 5 hereof or to otherwise amend this Agreement in a manner materially adverse to Manager.
(b)    Notices.  Every notice, consent or other communication required to be given pursuant to any provision of this Agreement shall, whether or not so stated, be made in writing (a “Notice”) and shall be delivered to the recipient Person by (i) personal delivery, (ii) registered or certified mail, return receipt requested, postage and charges prepaid, (iii) next day delivery courier service, or (iv) electronic mail, with a confirmation copy sent within the next Business Day by one of the methods of delivery set forth in subsection (i), (ii) or (iii), and addressed as follows (or to such other address or electronic mail address as the Parties may designate from time to time by delivery of a Notice pursuant to this Section 12(b)):
If to the Manager:
Whitestone TRS, Inc.
c/o Whitestone REIT
2600 South Gessner, Suite 500
Houston, TX 77063
Attention: David K. Holeman
Fax No.: 713-465-8847
Email: dholeman@whitestonereit.com

If to Owner:
c/o Pillarstone Capital REIT
10011 Valley Forge Drive
Houston, TX 77042
Attention:  John Dee
Fax No.:  713-465-8847
Email: jdee@visn.net

A Notice shall be deemed to be delivered to the Person to whom such Notice is sent upon (i) delivery to the address or electronic mail address of such Person; provided that such delivery is made prior to 5:00 p.m. (local time for such Person) on a Business Day, otherwise the following Business Day and, in the case of electronic mail, notice is made by overnight courier; or (ii) the attempted delivery of such Notice if (A) such Person refuses delivery of such Notice, or (B) such Person is no longer at such address or electronic mail address, and such Person failed to provide Notice of its current address or electronic mail address pursuant to this Section 12(b).
(c)    Successors and Assigns.  This Agreement shall inure to the benefit of the Parties and shall be binding upon the Parties, and their respective successors and permitted assigns.
(d)    Counterparts.  This Agreement may be executed in any number of counterparts (including e-mail PDF copies, which shall be deemed originals), each of which shall be deemed an original and all of which taken together shall constitute a single agreement.  At the request of any Party, each other Party will re-execute original forms thereof and deliver 

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them to the requesting Party.  No Party will raise the use of a facsimile machine or other electronic transmission as a defense to the formation or enforceability of a contract and each Party forever waives any such defense.
(e)    Non-Waiver.  No provision of this Agreement shall be deemed to have been waived unless such waiver is given in writing.  One or more waivers of the breach of any provision of this Agreement by any Party shall not be construed as a waiver of a subsequent breach of the same or any other provision, nor shall any delay or omission by a Party to seek a remedy for any breach of this Agreement or to exercise the rights accruing to a Party by reason of such breach be deemed a waiver by a Party of its remedies and rights with respect to such breach.
(f)    Entire Agreement.  This Agreement constitutes the entire agreement among the Parties with respect to the subject matter hereof and supersedes any prior agreement or understanding among them with respect to such subject matter.
(g)    Severability.  Every term and provision of this Agreement is intended to be severable.  If any term or provision hereof is held to be illegal, invalid or unenforceable for any reason whatsoever, such term or provision will be enforced to the maximum extent permitted by law and, in any event, such illegality, invalidity or unenforceability shall not affect the legality, validity or enforceability of the remainder of this Agreement, provided, however, that the Parties shall negotiate in good faith to amend this Agreement to modify any such illegal, invalid or unenforceable provision in order to carry out the Parties’ intent and agreement as embodied herein to the maximum extent permitted by law.
(h)    No Third Party Beneficiaries.  Subject to the rights of the Covered Persons and the Owner Indemnified Parties (all of which are third party beneficiaries of this Agreement), no Person that is not a party to this Agreement shall derive any rights or be attached to any obligations hereunder.
(i)    Assignment.  No Party may assign this Agreement or its rights hereunder to any Person without the written consent of the other Parties.  No assignment by any Person of this Agreement or of any of such Person’s rights hereunder shall release such Person from any of its obligations hereunder.  Any attempted assignment of this Agreement in violation of this Section 12(i) shall be void and of no effect.   
(j)    Interpretation.  As used in this Agreement, unless the context requires otherwise:  (i) any references to Schedules, Sections, Recitals or the preamble shall be deemed to refer to the schedules, sections, recitals or the preamble to this Agreement; (ii) all Exhibits and Schedules attached to this Agreement are hereby incorporated herein by reference; (iii) Section and other headings are for convenience only and shall not be used to interpret any provision of this Agreement; (iv) words used in this Agreement in the singular, where the context so permits, shall be deemed to include the plural and vice versa; (v) references in this Agreement to agreements (including this Agreement) and other contractual instruments shall be deemed to include all appendices, schedules, exhibits, annexes and attachments attached thereto and all subsequent amendments, extensions, renewals, substitutions and modifications to such agreements and other contractual instruments; (vi) the words “hereof,” “herein,” “hereunder” and similar words refer to this Agreement as a whole and not to any particular provision of this Agreement; (vii) the term “including” is not limiting and means “including 

13

without limitation”; (viii) references in this Agreement to any applicable laws and regulations shall be construed to include any and all amendments, modifications or supplements thereto enacted or implemented subsequent to the date hereof; (ix) a “day” means a calendar day; and (x) a “month” is a reference to a period starting on one day in a calendar month and ending on the numerically corresponding day in the next succeeding calendar month, and references to “months” shall be construed accordingly.
[Signature Pages Follow]

14

IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered by their representatives thereunto duly authorized on the day and year first above written.
Manager:
WHITESTONE TRS, INC.

		
	By:
	_________________________________ 
Name:  
Title:   

[Signature Page to Property Management Agreement]

Owner:
, 
 
a     
By:     
Name:      
Title:    

  

[Signature Page to Property Management Agreement]

Exhibit A
Services
Manager shall operate the Property in the same manner as is customary and usual in the operation of comparable facilities, and shall provide services that are customarily provided by operators of projects of comparable class and standing consistent with the Property’s facilities and which are located in the same geographic and market area as the Property, including, but not limited to the following:
		
	1.
	Provide management, leasing, and maintenance personnel to operate the Property.

		
	2.
	Contract with Service Providers for maintaining the Property.

		
	3.
	Maintain connected utility services at the Property.

		
	4.
	Invoice and collect the monthly rent from the Tenants; default and pursue collection for delinquent Tenants.

		
	5.
	Pay monthly invoices to vendors, including loan payments to lenders.

		
	6.
	Maintain monthly accounting records and provide monthly operating statements for each Property showing actual amounts for the month and year-to-date compared to budgeted amounts and compared to the similar periods of the preceding year, and other reports, including but not limited to revenues billed, collections received, detailed aging of accounts receivable, expenses paid, accounts payable to vendors, cash reports and bank reconciliations.

		
	7.
	Contract to have an annual audit preformed of the financial statements, prepare workpapers for the annual audit, and assist the auditors to complete the annual audit. 

		
	8.
	Assist in the preparation of, and/or engage Service Providers to prepare, the annual tax returns for Pillarstone, Pillarstone OP and the Owner, including Form 1099s and K-1s.

		
	9.
	Assist in the preparation of the SEC financial reports and other filings, including but not limited to Form 4s and Form 8-Ks.

 

Schedule 1

Description of PropertyForm of Medium-Term Notes, Series K, Principal at Risk Securities Linked

 Exhibit 4.1 

[Face of Note] 

Unless this certificate is presented by an authorized representative of The Depository Trust Company, a New York corporation
(“DTC”), to the Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as requested by an authorized representative
of DTC (and any payment is made to Cede & Co. or 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. 
  

	 CUSIP NO. 94986R2Z3 
	
FACE AMOUNT: $                   
  

 REGISTERED NO.      

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the Lowest Performing of the S&P 500®
Index 
 and the Russell 2000® Index due December 10, 2021 

WELLS FARGO & COMPANY, a corporation duly organized and existing under the laws of the State of Delaware (hereinafter
called the “Company,” which term includes any successor corporation under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & Co., or registered assigns, an amount equal to the
Redemption Amount (as defined below) on the Stated Maturity Date (as defined below), unless this Security is redeemed prior to the Stated Maturity Date as provided below under “Optional Redemption,” and to pay Contingent Coupon Payments
(as defined below) on the Face Amount of this Security to the extent provided herein on the Contingent Coupon Payment Dates specified herein at the Contingent Coupon Rate (as defined below) until the earlier of the Stated Maturity Date and the
Optional Redemption Date (as defined below), if any. The “Initial Stated Maturity Date” shall be December 10, 2021. If the Final Calculation Day (as defined below) is not postponed, the Initial Stated Maturity Date will be the
“Stated Maturity Date.” If the Final Calculation Day is postponed, the “Stated Maturity Date” shall be the later of (i) the Initial Stated Maturity Date and (ii) the third Business Day (as defined below)
after the Final Calculation Day as postponed. 
 “Face Amount” shall mean, when used with respect to this
Security, the amount set forth on the face of this Security as its “Face Amount.” 
 Optional Redemption 

The Company may, at its option, redeem this Security, in whole but not in part, on any Optional Redemption Date (as defined
below) by giving notice to the Holder hereof on or before the 

 
Calculation Day (as defined below) immediately preceding that Optional Redemption Date. If this Security is redeemed, the Holder hereof will receive the Optional Redemption Price (as defined
below) plus a final Contingent Coupon Payment (as defined below), if any, on the applicable Optional Redemption Date. Unless the Company defaults in the payment of the Optional Redemption Price plus the final Contingent Coupon Payment, if any, this
Security will cease to be outstanding on such Optional Redemption Date, no additional Contingent Coupon Payments will be payable on this Security and the Holder hereof will have no further rights under this Security after such Optional Redemption
Date. The “Optional Redemption Price” is equal to the Face Amount of this Security. The “Optional Redemption Dates” shall be the Contingent Coupon Payment Dates (as defined below) following each Calculation Day
scheduled to occur from June 2017 to September 2021, inclusive. 
 Payment of Contingent Coupon Payments, the Redemption Amount and the Optional
Redemption Price 
 On each quarterly Contingent Coupon Payment Date, the Company shall pay a Contingent Coupon
Payment if, and only if, the Closing Level (as defined below) of the Lowest Performing Index (as defined below) on the related Calculation Day (as defined below) is greater than or equal to its Threshold Level (as defined below). A
“Contingent Coupon Payment,” if payable as provided herein, shall be equal to the product of (i) the Face Amount of this Security, (ii) the Contingent Coupon Rate, and (iii) 90/360. The “Contingent Coupon
Payment Dates” shall be the fourth Business Day following each Calculation Day, as each such Calculation Day may be postponed as herein provided, provided that the Contingent Coupon Payment Date with respect to the Final Calculation Day
will be the Stated Maturity Date. The “Contingent Coupon Rate” is 8.80% per annum. Any Contingent Coupon Payments will be rounded to the nearest cent, with one-half cent rounded upward. 

Any Contingent Coupon Payment so payable, and punctually paid or duly provided for, on any Contingent Coupon Payment Date
will, as provided in the Indenture, be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such Contingent Coupon Payment next preceding such
Contingent Coupon Payment Date. The Regular Record Date for a Contingent Coupon Payment Date shall be the date one Business Day prior to such Contingent Coupon Payment Date. 

Any Contingent Coupon Payment not punctually paid or duly provided for will forthwith cease to be payable to the Holder on
such Regular Record Date and may either be paid to the Person in whose name this Security (or one or more Predecessor Securities) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed
by the Trustee, notice whereof shall be given to Holders of Securities of this series not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any
securities exchange on which the Securities of this series may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Indenture. 

Payment of any Contingent Coupon Payment on this Security will be made in immediately available funds at the office or agency
of the Company maintained for that purpose in the City of Minneapolis, Minnesota; provided, however, that, at the option of the Company, payment of any 

  
 2 

 
Contingent Coupon Payment may be paid by check mailed to the Person entitled thereto at such Person’s last address as it appears in the Security Register or by wire transfer to such account
as may have been designated by such Person. Payments of any Contingent Coupon Payment and the Redemption Amount or the Optional Redemption Price, as applicable, on this Security at Maturity will be made against presentation of this Security at the
office or agency of the Company maintained for that purpose in the City of Minneapolis, Minnesota and at any other office or agency maintained by the Company for such purpose. Notwithstanding the foregoing, for so long as this Security is a Global
Security registered in the name of the Depositary, any payments on this Security will be made to the Depositary by wire transfer of immediately available funds. 

Payment of the Redemption Amount or the Optional Redemption Price, as applicable, and any Contingent Coupon Payments on this
Security will be made in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts. 

Definitions Relating to Redemption Amount, the Optional Redemption Price and Contingent Coupon Payments 

If this Security is not redeemed prior to the Stated Maturity Date as provided above under “Optional Redemption,”
the “Redemption Amount” of this Security will equal: 
  

	 	•	 	 if the Ending Level of the Lowest Performing Index on the Final Calculation Day (as defined below) is greater
than or equal to its Threshold Level: the Face Amount; or 

  

	 	•	 	 if the Ending Level of the Lowest Performing Index on the Final Calculation Day is less than its Threshold
Level: 

  

											
		 	 	 	 Face Amount  x    
	 	Performance Factor of the Lowest Performing    	 	 	 	
		 	 	 	 	Index on the Final Calculation Day    	 	 	 

 All calculations with respect to the Redemption Amount will be rounded to the nearest one hundred-thousandth,
with five one-millionths rounded upward (e.g., 0.000005 would be rounded to 0.00001); and the Redemption Amount will be rounded to the nearest cent, with one-half cent rounded upward. 

“Index” shall mean each of the S&P 500 Index and the Russell 2000 Index. 

The “Pricing Date” shall mean December 6, 2016. 

The “Lowest Performing Index” on any Calculation Day will be the Index with the lowest Performance Factor on
that Calculation Day. 
 The “Performance Factor” with respect to an Index on any Calculation Day is its
Closing Level on such Calculation Day divided by its Starting Level (expressed as a percentage). 

  
 3 

 The “Starting Level” with respect to the S&P 500 Index is
2212.23, its Closing Level on the Pricing Date, and with respect to the Russell 2000 Index is 1352.668, its Closing Level on the Pricing Date. 

The “Ending Level” of an Index will be its Closing Level on the Final Calculation Day. 

The “Threshold Level” with respect to the S&P 500 Index is 1437.9495, which is equal to 65% of its
Starting Level, and with respect to the Russell 2000 Index is 879.2342, which is equal to 65% of its Starting Level. 
 The
“Closing Level” with respect to each Index on any Trading Day means the official closing level of that Index reported by the relevant Index Sponsor on such Trading Day, as obtained by the Calculation Agent on such Trading Day from
the licensed third-party market data vendor contracted by the Calculation Agent at such time; in particular, taking into account the decimal precision and/or rounding convention employed by such licensed third-party market data vendor on such date,
subject to the provisions set forth below under “—Market Disruption Events” and “—Discontinuance of an Index; Alteration of Method of Calculation.” 

“Index Sponsor” shall mean the sponsor or publisher of an Index. 

“Business Day” shall mean a day, other than a Saturday or Sunday, that is neither a legal holiday nor a day
on which banking institutions are authorized or required by law or regulation to close in New York, New York. 
 The
“Calculation Days” shall be the 6th day of each March, June, September and December, commencing March 2017 and ending September 2021, and the Final Calculation Day. If any such
day is not a Trading Day with respect to either Index, that Calculation Day for each Index will be postponed to the next succeeding day that is a Trading Day with respect to each Index. A Calculation Day is also subject to postponement due to the
occurrence of a Market Disruption Event (as defined below). The “Final Calculation Day” is December 6, 2021. If a Market Disruption Event occurs or is continuing with respect to either Index on any Calculation Day, then such
Calculation Day will be postponed for each Index to the first succeeding day that is a Trading Day for each Index and on which a Market Disruption Event has not occurred and is not continuing for either Index; however, if such first succeeding
Trading Day has not occurred as of the eighth day that is a Trading Day for each Index after the originally scheduled Calculation Day, that eighth day shall be deemed to be the Calculation Day for each Index. If a Calculation Day has been postponed
to that eighth day and a Market Disruption Event occurs or is continuing with respect to either Index on that eighth day, the Calculation Agent will determine the Closing Level of that Index on that day in accordance with the formula for and method
of calculating the Closing Level of such Index last in effect prior to commencement of the Market Disruption Event, using the closing price (or, with respect to any relevant security, if a Market Disruption Event has occurred with respect to such
security, its good faith estimate of the value of such security at the Scheduled Closing Time of the Relevant Stock Exchange for such security or, if earlier, the actual closing time of the regular trading session of such Relevant Stock Exchange) on
that day of each security included in such Index. As used herein, “closing price” means, with respect to any security on any date, the Relevant Stock Exchange traded or quoted price of such security as of the Scheduled Closing Time
of the 

  
 4 

 
Relevant Stock Exchange for such security or, if earlier, the actual closing time of the regular trading session of such Relevant Stock Exchange. 

“Calculation Agent Agreement” shall mean the Calculation Agent Agreement dated as of March 18, 2015
between the Company and the Calculation Agent, as amended from time to time. 
 “Calculation Agent” shall
mean the Person that has entered into the Calculation Agent Agreement with the Company providing for, among other things, whether a Contingent Coupon Payment will be made, the Optional Redemption Price, if any, and the Redemption Amount, if any,
which term shall, unless the context otherwise requires, include its successors under such Calculation Agent Agreement. The initial Calculation Agent shall be Wells Fargo Securities, LLC. Pursuant to the Calculation Agent Agreement, the Company may
appoint a different Calculation Agent from time to time after the initial issuance of this Security without the consent of the Holder of this Security and without notifying the Holder of this Security. 

Certain Definitions 
 A
“Trading Day” with respect to an Index means a day, as determined by the Calculation Agent, on which (i) the Relevant Stock Exchanges with respect to each security underlying such Index are scheduled to be open for trading for
their respective regular trading sessions and (ii) each Related Futures or Options Exchange with respect to such Index is scheduled to be open for trading for its regular trading session. 

The “Relevant Stock Exchange” for any security underlying an Index means the primary exchange or quotation
system on which such security is traded, as determined by the Calculation Agent. 
 The “Related Futures or Options
Exchange” for an Index means an exchange or quotation system where trading has a material effect (as determined by the Calculation Agent) on the overall market for futures or options contracts relating to such Index. 

Discontinuance Of An Index; Alteration Of Method Of Calculation 

If an Index Sponsor discontinues publication of an Index, and such Index Sponsor or another entity publishes a successor or
substitute equity index that the Calculation Agent determines, in its sole discretion, to be comparable to such Index (a “Successor Equity Index”), then, upon the Calculation Agent’s notification of that determination to the
Trustee and the Company, the Calculation Agent will substitute the Successor Equity Index as calculated by the relevant Index Sponsor or any other entity for purposes of calculating the Closing Level of such Index on any date of determination. Upon
any selection by the Calculation Agent of a Successor Equity Index, the Company will cause notice to be given to the Holder of this Security. 

In the event that an Index Sponsor discontinues publication of an Index prior to, and the discontinuance is continuing on, a
Calculation Day and the Calculation Agent determines that no Successor Equity Index is available at such time, the Calculation Agent will calculate a substitute Closing Level for such Index in accordance with the formula for and method of
calculating such Index last in effect prior to the discontinuance, but using only those securities that comprised such Index immediately prior to that discontinuance. If a Successor Equity Index is selected or

  
 5 

 
the Calculation Agent calculates a level as a substitute for such Index, the Successor Equity Index or level will be used as a substitute for such Index for all purposes, including the purpose of
determining whether a Market Disruption Event exists. 
 If on a Calculation Day an Index Sponsor fails to calculate
and announce the level of an Index, the Calculation Agent will calculate a substitute Closing Level of such Index in accordance with the formula for and method of calculating such Index last in effect prior to the failure, but using only those
securities that comprised such Index immediately prior to that failure; provided that, if a Market Disruption Event occurs or is continuing on such day with respect to such Index, then the provisions set forth above under the definition of
“Calculation Days” shall apply in lieu of the foregoing. 
 If at any time the relevant Index Sponsor makes
a material change in the formula for or the method of calculating an Index, or in any other way materially modifies such Index (other than a modification prescribed in that formula or method to maintain such Index in the event of changes in
constituent stock and capitalization and other routine events), then, from and after that time, the Calculation Agent will, at the close of business in New York, New York, on each date that the Closing Level of such Index is to be calculated,
calculate a substitute Closing Level of such Index in accordance with the formula for and method of calculating such Index last in effect prior to the change, but using only those securities that comprised such Index immediately prior to that
change. Accordingly, if the method of calculating an Index is modified so that the level of such Index is a fraction or a multiple of what it would have been if it had not been modified, then the Calculation Agent will adjust such Index in order to
arrive at a level of such Index as if it had not been modified. 
 Market Disruption Events 

A “Market Disruption Event” with respect to an Index means any of the following events as determined by the
Calculation Agent in its sole discretion: 
  

	 	(A)	 The occurrence or existence of a material suspension of or limitation imposed on trading by the Relevant Stock
Exchanges or otherwise relating to securities which then comprise 20% or more of the level of such Index or any Successor Equity Index at any time during the one-hour period that ends at the Close of Trading on that day, whether by reason of
movements in price exceeding limits permitted by those Relevant Stock Exchanges or otherwise. 

  

	 	(B)	 The occurrence or existence of a material suspension of or limitation imposed on trading by any Related
Futures or Options Exchange or otherwise in futures or options contracts relating to such Index or any Successor Equity Index on any Related Futures or Options Exchange at any time during the one-hour period that ends at the Close of Trading on that
day, whether by reason of movements in price exceeding limits permitted by the Related Futures or Options Exchange or otherwise. 

  

	 	(C)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the
ability of market participants in general to effect 

  
 6 

	 	 
transactions in, or obtain market values for, securities that then comprise 20% or more of the level of such Index or any Successor Equity Index on their Relevant Stock Exchanges at any time
during the one-hour period that ends at the Close of Trading on that day. 

  

	 	(D)	 The occurrence or existence of any event, other than an early closure, that materially disrupts or impairs the
ability of market participants in general to effect transactions in, or obtain market values for, futures or options contracts relating to such Index or any Successor Equity Index on any Related Futures or Options Exchange at any time during the
one-hour period that ends at the Close of Trading on that day. 

  

	 	(E)	 The closure on any Exchange Business Day of the Relevant Stock Exchanges on which securities that then
comprise 20% or more of the level of such Index or any Successor Equity Index are traded or any Related Futures or Options Exchange with respect to such Index or any Successor Equity Index prior to its Scheduled Closing Time unless the earlier
closing time is announced by the Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, at least one hour prior to the earlier of (1) the actual closing time for the regular trading session on such Relevant Stock
Exchange or Related Futures or Options Exchange, as applicable, and (2) the submission deadline for orders to be entered into the Relevant Stock Exchange or Related Futures or Options Exchange, as applicable, system for execution at such actual
closing time on that day. 

  

	 	(F)	 The Relevant Stock Exchange for any security underlying such Index or Successor Equity Index or any Related
Futures or Options Exchange fails to open for trading during its regular trading session. 

 For purposes
of determining whether a Market Disruption Event has occurred with respect to an Index: 
  

	 	(1)	 the relevant percentage contribution of a security to the level of such Index or any Successor Equity Index
will be based on a comparison of (x) the portion of the level of such Index attributable to that security and (y) the overall level of such Index or Successor Equity Index, in each case immediately before the occurrence of the Market
Disruption Event; 

  

	 	(2)	 the “Close of Trading” on any Trading Day for such Index or any Successor Equity Index means
the Scheduled Closing Time of the Relevant Stock Exchanges with respect to the securities underlying such Index or Successor Equity Index on such Trading Day; provided that, if the actual closing time of the regular trading session of any such
Relevant Stock Exchange is earlier than its Scheduled Closing Time on such Trading Day, then (x) for purposes of clauses (A) and (C) of the definition of “Market Disruption Event” above, with respect to any security
underlying such Index or Successor Equity Index for which such Relevant Stock Exchange is its Relevant Stock Exchange, the “Close of Trading” means such actual closing time and (y) for purposes of clauses (B) and (D) of the
definition of “Market Disruption Event” above, with 

  
 7 

	 	 
respect to any futures or options contract relating to such Index or Successor Equity Index, the “Close of Trading” means the latest actual closing time of the regular trading session
of any of the Relevant Stock Exchanges, but in no event later than the Scheduled Closing Time of the Relevant Stock Exchanges; 

  

	 	(3)	 the “Scheduled Closing Time” of any Relevant Stock Exchange or Related Futures or Options
Exchange on any Trading Day for such Index or any Successor Equity Index means the scheduled weekday closing time of such Relevant Stock Exchange or Related Futures or Options Exchange on such Trading Day, without regard to after hours or any other
trading outside the regular trading session hours; and 

  

	 	(4)	 an “Exchange Business Day” means any Trading Day for such Index or any Successor Equity Index
on which each Relevant Stock Exchange for the securities underlying such Index or any Successor Equity Index and each Related Futures or Options Exchange with respect to such Index or any Successor Equity Index are open for trading during their
respective regular trading sessions, notwithstanding any such Relevant Stock Exchange or Related Futures or Options Exchange closing prior to its Scheduled Closing Time. 

Calculation Agent 

The Calculation Agent will determine whether a Contingent Coupon Payment will be made, the Optional Redemption Price, if any,
and the Redemption Amount, if any. In addition, the Calculation Agent will (i) determine if adjustments are required to the Closing Level of an Index under the circumstances described in this Security, (ii) if publication of an Index is
discontinued, select a Successor Equity Index or, if no Successor Equity Index is available, determine the Closing Level of such Index under the circumstances described in this Security, and (iii) determine whether a Market Disruption Event has
occurred. 
 The Company covenants that, so long as this Security is Outstanding, there shall at all times be a Calculation
Agent (which shall be a broker-dealer, bank or other financial institution) with respect to this Security. 

All determinations made by the Calculation Agent with respect to this Security will be at the sole discretion of the
Calculation Agent and, in the absence of manifest error, will be conclusive for all purposes and binding on the Company and the Holder of this Security. 

Redemption and Repayment 

This Security is not subject to repayment at the option of the Holder hereof prior to December 10, 2021. This Security is
subject to redemption prior to December 10, 2021 as set forth under “Optional Redemption” above. This Security is not entitled to any sinking fund. 

Acceleration 
 If
an Event of Default, as defined in the Indenture, with respect to this Security shall occur and be continuing, the Redemption Amount (calculated as set forth in the next two sentences) of this Security may be declared due and payable in the manner
and with the effect provided in the 

  
 8 

 
Indenture. The amount payable to the Holder hereof upon any acceleration permitted under the Indenture will be equal to the Redemption Amount hereof calculated as provided herein, plus a portion
of a final Contingent Coupon Payment, if any. The Redemption Amount and any final Contingent Coupon Payment will be calculated as though the date of acceleration were the Final Calculation Day. The final Contingent Coupon Payment, if any, will be
prorated from and including the immediately preceding Contingent Coupon Payment Date to but excluding the date of acceleration. 
  

 

Reference is hereby made to the further provisions of this Security set forth on the reverse hereof, which further provisions
shall for all purposes have the same effect as if set forth at this place. 
 Unless the certificate of authentication
hereon has been executed by the Trustee referred to on the reverse hereof by manual signature or its duly authorized agent under the Indenture referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit
under the Indenture or be valid or obligatory for any purpose. 
 [The remainder of this page has been left intentionally blank] 

  
 9 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed
under its corporate seal. 
 DATED: 
  

					
	WELLS FARGO & COMPANY
		
	By:	 	 
			
		 	Its:	 	 

 [SEAL] 
  

					
	Attest:	 	 
			
		 	Its:	 	 

  

			
	 TRUSTEE’S CERTIFICATE OF

AUTHENTICATION
 This is one of the Securities of the

series designated therein described
 in the within-mentioned Indenture.

	
	 CITIBANK, N.A.,

      as Trustee

		
	By:	 	 
		 	Authorized Signature
	
	OR
	
	 WELLS FARGO BANK, N.A.,

  as Authenticating Agent for the Trustee

		
	By:	 	 
		 	Authorized Signature

  
 10 

 [Reverse of Note] 

WELLS FARGO & COMPANY 

MEDIUM-TERM NOTE, SERIES K 

Due Nine Months or More From Date of Issue 

Principal at Risk Securities Linked to the Lowest Performing of the S&P 500®
Index 
 and the Russell 2000® Index due December 10, 2021 

This Security is one of a duly authorized issue of securities of the Company (herein called the
“Securities”), issued and to be issued in one or more series under an indenture dated as of July 21, 1999, as amended or supplemented from time to time (herein called the “Indenture”), between the Company and
Citibank, N.A., as Trustee (herein called the “Trustee,” which term includes any successor trustee under the Indenture), to which Indenture and all indentures supplemental thereto reference is hereby made for a statement of the
respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities, and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is
one of the series of the Securities designated as Medium-Term Notes, Series K, of the Company, which series is limited to an aggregate principal amount or face amount, as applicable, of $25,000,000,000 or the equivalent thereof in one or more
foreign or composite currencies. The amount payable on the Securities of this series may be determined by reference to the performance of one or more equity-, commodity- or currency-based indices, exchange traded funds, securities, commodities,
currencies, statistical measures of economic or financial performance, or a basket comprised of two or more of the foregoing, or any other market measure or may bear interest at a fixed rate or a floating rate. The Securities of this series may
mature at different times, be redeemable at different times or not at all, be repayable at the option of the Holder at different times or not at all and be denominated in different currencies. 

Article Sixteen of the Indenture shall not apply to this Security. 

The Securities are issuable only in registered form without coupons and will be either
(a) book-entry securities represented by one or more Global Securities recorded in the book-entry system maintained by the Depositary or (b) certificated
securities issued to and registered in the names of, the beneficial owners or their nominees. 
 The Company agrees, to the
extent permitted by law, not to voluntarily claim the benefits of any laws concerning usurious rates of interest against a Holder of this Security. 

Modification and Waivers 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights
and obligations of the Company and the rights of the Holders of the Securities of each series to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the
Securities at the 

  
 11 

 
time Outstanding of all series to be affected, acting together as a class. The Indenture also contains provisions permitting the Holders of a majority in principal amount of the Securities of all
series at the time Outstanding affected by certain provisions of the Indenture, acting together as a class, on behalf of the Holders of all Securities of such series, to waive compliance by the Company with those provisions of the Indenture. Certain
past defaults under the Indenture and their consequences may be waived under the Indenture by the Holders of a majority in principal amount of the Securities of each series at the time Outstanding, on behalf of the Holders of all Securities of such
series. Solely for the purpose of determining whether any consent, waiver, notice or other action or Act to be taken or given by the Holders of Securities pursuant to the Indenture has been given or taken by the Holders of Outstanding Securities in
the requisite aggregate principal amount, the principal amount of this Security will be deemed to be equal to the amount set forth on the face hereof as the “Face Amount” hereof. Any such consent or waiver by the Holder of this Security
shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or
waiver is made upon this Security. 
 Defeasance 

Section 403 and Article Fifteen of the Indenture and the provisions of clause (ii) of Section 401(1)(B) of the
Indenture, relating to defeasance at any time of (a) the entire indebtedness on this Security and (b) certain restrictive covenants and certain Events of Default, upon compliance by the Company with certain conditions set forth therein,
shall not apply to this Security. The remaining provisions of Section 401 of the Indenture shall apply to this Security. 
 Authorized
Denominations 
 This Security is issuable only in registered form without coupons in denominations of $1,000 or any
amount in excess thereof which is an integral multiple of $1,000. 
 Registration of Transfer 

Upon due presentment for registration of transfer of this Security at the office or agency of the Company in the City of
Minneapolis, Minnesota, a new Security or Securities of this series, with the same terms as this Security, in authorized denominations for an equal aggregate Face Amount will be issued to the transferee in exchange herefor, as provided in the
Indenture and subject to the limitations provided therein and to the limitations described below, without charge except for any tax or other governmental charge imposed in connection therewith. 

This Security is exchangeable for definitive Securities in registered form only if (x) the Depositary notifies the
Company that it is unwilling or unable to continue as Depositary for this Security or if at any time the Depositary ceases to be a clearing agency registered under the Securities Exchange Act of 1934, as amended, and a successor depositary is not
appointed within 90 days after the Company receives such notice or becomes aware of such ineligibility, (y) the Company in its sole discretion determines that this Security shall be exchangeable for definitive Securities in registered form
and notifies the Trustee thereof or (z) an Event of Default with respect to the Securities represented hereby has occurred and is continuing. If this Security is exchangeable pursuant to the preceding sentence, it shall be exchangeable for
definitive Securities in registered 

  
 12 

 
form, bearing interest at the same rate, having the same date of issuance, Stated Maturity Date and other terms and of authorized denominations aggregating a like amount. 

This Security may not be transferred except as a whole by the Depositary to a nominee of the Depositary or by a nominee of the
Depositary to the Depositary or another nominee of the Depositary or by the Depositary or any such nominee to a successor of the Depositary or a nominee of such successor. Except as provided above, owners of beneficial interests in this Global
Security will not be entitled to receive physical delivery of Securities in definitive form and will not be considered the Holders hereof for any purpose under the Indenture. 

Prior to due presentment of this Security for registration of transfer, the Company, the Trustee and any agent of the Company
or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and neither the Company, the Trustee nor any such agent shall be affected by notice to the
contrary. 
 Obligation of the Company Absolute 

No reference herein to the Indenture and no provision of this Security or the Indenture shall alter or impair the obligation
of the Company, which is absolute and unconditional, to pay the Contingent Coupon Payments, if any, and the Redemption Amount or the Optional Redemption Price, as applicable, on this Security at the times, place and rate, and in the coin or
currency, herein prescribed, except as otherwise provided in this Security. 
 No Personal Recourse 

No recourse shall be had for the payment of any Contingent Coupon Payments or the Redemption Amount or the Optional Redemption
Price, as applicable, on this Security or for any claim based hereon, or otherwise in respect hereof, or based on or in respect of the Indenture or any indenture supplemental thereto, against any incorporator, stockholder, officer or director, as
such, past, present or future, of the Company or any successor corporation, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise, all such liability being, by the acceptance
hereof and as part of the consideration for the issuance hereof, expressly waived and released. 
 Defined Terms 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture
unless otherwise defined in this Security. 
 Governing Law 

This Security shall be governed by and construed in accordance with the law of the State of New York, without regard to
principles of conflicts of laws. 

  
 13 

 ABBREVIATIONS 

The following abbreviations, when used in the inscription on the face of this instrument, shall be construed as though they
were written out in full according to applicable laws or regulations: 
  

					
	 TEN COM
	 	  -- 
	 	 as tenants in common

			
	 TEN ENT
	 	  -- 
	 	 as tenants by the entireties

			
	 JT TEN
	 	  -- 
	 	 as joint tenants with right

of survivorship and not
 as
tenants in common

  

									
	 UNIF GIFT MIN ACT
	 	  -- 
	 	 	 	 Custodian 
	 	 
		 		 	(Cust)	 		 	    (Minor)

  

	
	Under Uniform Gifts to Minors Act
	
	   

	(State)

 Additional abbreviations may also be used though not in the above list. 

FOR VALUE RECEIVED, the undersigned hereby sell(s) and transfer(s) unto 

 

	
	 Please Insert Social Security or
 Other
Identifying Number of Assignee

	
	
	   

  
  

 
  
  

 
 (PLEASE
PRINT OR TYPE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE)

  
 14 

 the within Security of WELLS FARGO & COMPANY and does hereby irrevocably constitute and
appoint                                  attorney to transfer the said Security on
the books of the Company, with full power of substitution in the premises. 
 Dated:
                                 

 

	
	   

  

	
	   

 NOTICE: The signature to this assignment must correspond with the name as written upon the face of the
within instrument in every particular, without alteration or enlargement or any change whatever. 

  
 15

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