Document:

Exhibit 101

		

			 

		

		
			Exhibit 10.1
		

		
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			THIRD AMENDED AND RESTATED MANAGEMENT AGREEMENT 
		

		
			This THIRD AMENDED AND RESTATED MANAGEMENT AGREEMENT (this “Management Agreement”), is effective as of November 1, 2017, is made and entered into by and among JERNIGAN CAPITAL, INC., a Maryland corporation, (the “Company”), JERNIGAN CAPITAL OPERATING COMPANY LLC (f/k/a Jernigan Capital Operating Partnership LP, a Delaware limited liability company (the “Operating Company”) and JCap Advisors, LLC, a Delaware limited liability company (the “Manager”).
		

		
			WITNESSETH: 
		

		
			WHEREAS, the Company is a corporation operating in a manner that qualifies for election as a real estate investment trust (“REIT”) for U.S. federal income tax purposes and that intends to make such election;  
		

		
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			WHEREAS, the Operating Company is a wholly owned subsidiary of the Company;
		

		
			WHEREAS, the Company and each of its Subsidiaries, including the Operating Company,  effective April 1, 2015, engaged the Manager to provide certain management and advisory services to them on the terms and conditions hereinafter set forth, and the Manager has continuously provided such services since that time in compliance with this Agreement; and
		

		
			WHEREAS, the parties desire to amend and restate this Agreement to clarify the original intent of the parties with respect to the definition of Core Earnings and to make other changes necessary to reflect the Company’s current and anticipated business model from and after this time.
		

		
			NOW, THEREFORE, for the mutual promises made herein and other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties agree to amend and restate this Management Agreement as follows: 
		

		
			Section 1.  Definitions.  The following terms have the following meanings assigned to them:
		

			
	
			
				 (a)
			“Affiliate” means with respect to any Person, (i) any other Person directly or indirectly controlling, controlled by, or under common control with such other Person, (ii) any executive officer, general partner or employee of such Person, (iii) any member of the board of directors or board of managers (or bodies performing similar functions) of such Person, and (iv) any legal entity for which such Person acts as an executive officer or general partner.

			
	
			
				 (b)
			“Agreement” means this Management Agreement, as amended, restated or supplemented from time to time.

			
	
			
				 (c)
			“Bankruptcy” means with respect to any Person, (a) the filing by such Person of a voluntary petition seeking liquidation, reorganization, arrangement or readjustment, in any form, of its debts under Title 11 of the United States Code or any other federal, state or foreign insolvency law, or such Person’s filing an answer consenting to or acquiescing in any such petition, (b) the making by such Person of any assignment for the benefit of its creditors, (c) the expiration of 90 days after the filing of an involuntary petition under Title 11 of the Unites States Code, an application for the appointment of a receiver for a material portion of the assets of such Person, or an involuntary petition seeking liquidation, reorganization, arrangement or readjustment of its debts under any other federal, state or foreign insolvency law, provided that the same shall not have been vacated, set aside or stayed within such 90­day period or (d) the entry against it of a final and non­appealable order for relief under any bankruptcy, insolvency or similar law now or hereinafter in effect.

			
	
			
				 (d)
			“Base Management Fee” means an amount equal to 0.375% of the Company stockholders’ equity (a 1.5% annual rate) calculated and payable quarterly in arrears in cash. 

		

		

		 

 

		
		

		
			For purposes of calculating the base management fee, the Company stockholders’ equity means: (a) the sum of (i) the net proceeds from all issuances of the Company’s equity securities since inception (allocated on a pro rata daily basis for such issuances during the fiscal quarter of any such issuance), plus (ii) the Company’s retained earnings at the end of the most recently completed fiscal quarter (without taking into account any non-cash equity compensation expense incurred in current or prior periods); less (b) any amount that the Company pays to repurchase the Common Stock since inception; provided that if the Company’s retained earnings are in a net deficit position (following any required adjustments set forth below), then retained earnings shall not be included in stockholders’ equity.   Stockholders’ equity also excludes any unrealized gains and losses and other non-cash items that have impacted stockholders’ equity as reported in the Company’s financial statements prepared in accordance with accounting principles generally accepted in the United States, or GAAP, and one-time events pursuant to changes in GAAP (such as a cumulative change to the Company’s operating results as a result of a codification change pursuant to GAAP), and certain non-cash items not otherwise described above (such as depreciation and amortization), in each case after discussions between the Company’s Manager and the Independent Directors and approval by a majority of the Independent Directors. 
		

			
	
			
				 (e)
			“Board of Directors” means the Board of Directors of the Company.

			
	
			
				 (f)
			“Business Day” means any day except a Saturday, a Sunday or a day on which banking institutions in New York, New York are not required to be open.

			
	
			
				 (g)
			“Code” means the Internal Revenue Code of 1986, as amended.

			
	
			
				 (h)
			“Common Stock” means the common stock, par value $0.01, of the Company.

			
	
			
				 (i)
			“Company Account” shall have the meaning set forth in Section 5 of this Agreement.

			
	
			
				 (j)
			“Core Earnings” means an amount equal to (1) net income (loss) determined under accounting principles generally accepted in the United States of America, or GAAP, plus (2) non-cash equity compensation expense, the incentive fee, depreciation and amortization, plus (3) any unrealized losses or other non-cash expense items reflected in GAAP net income (loss), less (4) any unrealized gains reflected in GAAP net income (including any unrealized appreciation with respect to self-storage facilities that the Company has not yet acquired). The amount will be adjusted to exclude one-time events pursuant to changes in GAAP and certain other non-cash charges after discussions between the Manager and the Independent Directors and after approval by a majority of the Independent Directors. Notwithstanding any other provision in this Agreement to the contrary, and in addition to the adjustments described above in the immediately preceding sentence, with respect to any self-storage facility acquired by the Company with respect to which the Company had an outstanding loan as of the time of such acquisition, the amount determined pursuant to the formula above in the period of such acquisition shall also be increased by the difference between (A) the appraised value, as determined by a nationally recognized, independent third-party appraiser mutually agreed to by the Company and the Manager who has significant expertise in valuing self-storage properties, and (B) the sum of (i) the outstanding principal amount of any loan made by the Company, the Operating Company or any subsidiary that is secured by such acquired self-storage facility at the time of such acquisition, plus (ii) any other consideration given to the former owner upon such acquisition. For the avoidance of doubt, this addition is intended to include in Core Earnings the amount of the Company’s unrealized gain on account of the Company’s acquisition of a self-storage facility without such facility being sold to a  third party buyer in the open market. 

			
	
			
				 (k)
			“Covered Person” shall have the meaning set forth in Section 12(a) of this Agreement.

			
	
			
				 (l)
			“Effective Termination Date” shall have the meaning set forth in Section 13(a) of this Agreement.

			
	
			
				 (m)
			“Excess Funds” shall have the meaning set forth in Section 2(l) of this Agreement.

			
	
			
				 (n)
			“Exchange Act” means the Securities Exchange Act of 1934, as amended.

			
	
			
				 (o)
			“Expenses” shall have the meaning set forth in Section 10(a) of this Agreement.

			
	
			
				 (p)
			“GAAP” means generally accepted accounting principles, as applied in the United States.

			
	
			
				 (q)
			“Governing Instruments” means, with regard to any entity, the articles of incorporation and bylaws in the case of a corporation, certificate of limited partnership (if applicable) and the partnership agreement in the case of a general or limited partnership, the articles of formation and the operating agreement in the case of a limited liability company, the trust instrument in the case of a trust, or similar governing documents, in each case as amended from time to time.

			
	
			
				 (r)
			“Incentive Fee” means an amount, not less than zero, determined pursuant to the following formula:

		

		

		 

		

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		IF = .20 times (A minus (B times .08)) minus  C
		

		
			In the foregoing formula:
		

			
	
			
				 (i)
			

			
	
			
			“A” equals the Company’s Core Earnings for the previous 12-month period;

			
	
			
				 (ii)
			

			
	
			
			“B” equals (A) the weighted average of the issue price per share to the public of the Common Stock of all of the Company’s public offerings of the Common Stock, multiplied by (B) the weighted average number of all shares of the Common Stock outstanding (including any restricted stock units and any restricted stock shares of the Company’s Common Stock in the previous 12-month period and shares of the Common Stock which may be issued upon the conversion of any outstanding units of the Operating Company); and

			
	
			
				 (iii)
			

			
	
			
			“C” equals the sum of any incentive fees earned by the Manager with respect to the first three fiscal quarters of such previous 12-month period.

		
			;  provided, however, that no incentive fee shall be paid with respect to any fiscal quarter unless cumulative annual stockholder total return for the four most recently completed fiscal quarters is greater than 8%.  Any computed incentive fee earned but not paid because of the foregoing hurdle will accrue until such 8% cumulative annual stockholder total return is achieved. The total return for this purpose will be calculated by adding stock price appreciation (based on the volume-weighted average of the closing price of the Company’s Common Stock on the NYSE (or other applicable trading market) for the last ten consecutive trading days of the applicable computation period minus the volume-weighted average of the closing market price of the Company’s Common Stock for the last ten consecutive trading days of the period immediately preceding the applicable computation period) plus dividends per share of Common Stock paid during such computation period, divided by the volume-weighted average of the closing market price of the Company’s Common Stock for the last ten consecutive trading days of the period immediately preceding the applicable computation period.
		

			
	
			
				 (s)
			“Independent Directors” means the members of the Board of Directors who are not officers or employees of the Manager or any Person directly or indirectly controlling or controlled by the Manager, and who are otherwise “independent” in accordance with the NYSE’s corporate governance listing standards (or the rules of any other national securities exchange on which the Common Stock is listed).

			
	
			
				 (t)
			“Initial Public Offering” means the Company’s sale of the Common Stock to the public through underwriters pursuant to the Company’s Registration Statement on Form S-11 (No. 333-202219)

			
	
			
				 (u)
			“Initial Term” shall have the meaning set forth in Section 13(a) of this Agreement.

			
	
			
				 (v)
			“Internalization Formulas” means (i) the Manager’s earnings before interest, taxes, depreciation and amortization (adjusted for unusual, extraordinary and non-recurring charges and expenses), or “EBITDA” (excluding any reimbursements from the Company), annualized based on the most recent quarter ended, multiplied by a specific multiple, or EBITDA Multiple, set forth below depending on the Company’s achieved total annual return, and (ii) the Company’s equity market capitalization multiplied by a specific percentage, or Capitalization Percentage, set forth below depending on the Company’s achieved total return. 

		
			For purposes of the computations above, the EBITDA Multiple and Capitalization Percentage, respectively, for specific levels of total return are (i) 5.0 and 5.0% if total return is less than 8.0%; (ii) 5.5 and 5.5% if total return is at least 8.0% and not more than 12.0%; and (iii) 6.0 and 6.0% if total return is greater than 12.0%.  For purposes of the foregoing computation, total return will be calculated by adding (i) the difference (if any, but not a negative number) between the volume-weighted average of the closing price per share of the Common Stock on the NYSE (or other applicable trading market) for the last ten consecutive trading days of the computation period and the Initial Public Offering price per share (taking into account any stock splits, subdivisions, or reclassifications), plus (ii) dividends per share paid in respect of the Common Stock since the Initial Public Offering, dividing the result by the number of full months elapsed since the Initial Public Offering, and multiplying the result by 12.
		

		

		

		 

		

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				 (w)
			“Internalization Price”  has the meaning set forth in Section 17(e) of this Agreement.

		
			 
		

			
	
			
				 (x)
			“Internalization Transaction” means a transaction in which the Manager contributes to the Operating Company all of the assets of the Manager including, without limitation, all furniture, fixtures, leasehold improvements, contract rights, computer software, employment and customer relationships, goodwill, going concern value, other identifiable intangible assets and other business assets then owned by the Manager, or, in the alternative, the equity owners of the Manager contribute to the Operating Company 100% of the outstanding equity interests in the Manager.

			
	
			
				 (y)
			“Investment Company Act” means the Investment Company Act of 1940, as amended.

			
	
			
				 (z)
			“Investment Committee” shall have the meaning set forth in Section 2(k) of this Agreement.

			
	
			
				 (aa)
			“Investment Guidelines” shall have the meaning set forth in Section 2(b)(i) of this Agreement.

			
	
			
				 (bb)
			“Investments” means the investments of the Company and the Subsidiaries.

			
	
			
				 (cc)
			“Manager Change of Control” means the sale, lease, transfer or other disposition, in one or a series of related transactions, of interests in the Manager which will transfer to any Person other than an Affiliate of the Company the power to direct or control the Manager; provided, however, that Manager Change of Control shall not include (i) any public offering of the equity interests of the Manager, or (ii) any assignment of this Agreement by the Manager as permitted hereby and in accordance with the terms hereof.

			
	
			
				 (dd)
			“Monitoring Services” shall have the meaning set forth in Section 2(b) of this Agreement.

			
	
			
				 (ee)
			“Notice of Proposal to Negotiate” shall have the meaning set forth in Section 13(a) of this Agreement.

			
	
			
				 (ff)
			“NYSE” means the New York Stock Exchange.

			
	
			
				 (gg)
			“OC Units” means units of limited liability company interests in the Operating Company.

			
	
			
				 (hh)
			“Person” means any individual, corporation, partnership, joint venture, limited liability company, estate, trust, unincorporated association, any federal, state, county or municipal government or any bureau, department or agency thereof and any fiduciary acting in such capacity on behalf of any of the foregoing.

			
	
			
				 (ii)
			“Portfolio Management Services” shall have the meaning set forth in Section 2(b) of this Agreement. 

			
	
			
				 (jj)
			“REIT” shall have the meaning set forth in the recitals of this Agreement.

			
	
			
				 (kk)
			“Renewal Term” shall have the meaning set forth in Section 13(a) of this Agreement, with the last day of the last Renewal Term being March 31, 2023.

			
	
			
				 (ll)
			“SEC” means the U.S. Securities and Exchange Commission.

			
	
			
				 (mm)
			“Securities Act” means the Securities Act of 1933, as amended.

			
	
			
				 (nn)
			“Subsidiary” means a corporation, limited liability company, partnership, joint venture or other entity or organization of which: (a) the Company or any other subsidiary of the Company is a general partner or managing member; or (b) voting power to elect a majority of the board of directors, trustees or others performing similar functions with respect to such entity or organization is held by the Company or by any one or more of the Company’s subsidiaries.  

			
	
			
				 (oo)
			“Target Assets” means the types of investments described under “Business—Our Investment Strategy” and “Business—Target Investments” in the Company’s prospectus dated  March 26, 2015, relating to the Initial Public Offering, subject to, and including any changes to the Investment Guidelines that may be approved by the Manager and the Board of Directors from time to time. 

			
	
			
				 (pp)
			“Termination Fee” shall have the meaning set forth in Section 13(b) of this Agreement.

		 

		

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				 (qq)
			“Termination Notice” shall have the meaning set forth in Section 13(a) of this Agreement.

			
	
			
				 (rr)
			“Treasury Regulations” means the regulations promulgated under the Code, as amended from time to time.

			
	
			
				 (ss)
			The words “hereof,” “herein” and “hereunder” and words of similar import when used in this Agreement shall refer to this Agreement as a whole and not to any particular provision of this Agreement, and Section references are to this Agreement unless otherwise specified.

			
	
			
				 (tt)
			The meanings given to terms defined herein shall be equally applicable to both the singular and plural forms of such terms. The words include, includes and including shall be deemed to be followed by the phrase “without limitation.”

		
			Section 2.  Appointment and Duties of the Manager.
		

			
	
			
				 (a)
			The Company and each of its Subsidiaries hereby appoint the Manager to (i) manage the Investments and day-to-day operations of the Company and each of its Subsidiaries subject to the terms and conditions set forth in this Agreement.  The Manager hereby agrees to use its commercially reasonable efforts to perform each of the duties set forth herein.  The appointment of the Manager shall be exclusive to the Manager except to the extent that the Manager otherwise agrees, in its sole and absolute discretion, and except to the extent that the Manager elects, in accordance with the terms of this Agreement, to cause the duties of the Manager hereunder to be provided by third parties.

			
	
			
				 (b)
			The Manager, in its capacity as manager of the Investments and the day-to-day operations of the Company and its Subsidiaries, at all times will be subject to the supervision of the Board of Directors, and the Manager will have only such functions and authority as the Company may delegate to it including, without limitation, managing the Company’s business affairs in conformity with the Investment Guidelines and policies that are approved and monitored by the Board of Directors. The Company and the Manager hereby acknowledge the recommendation by the Manager and the approval by the Board of Directors, of the Investment Guidelines, including the Company’s investment strategy in the Target Assets. The Company and the Manager hereby acknowledge and agree that, during the term of this Agreement, any proposed changes to the Company’s investment strategy that would modify or expand the Target Assets may only be recommended by the Manager and shall require the approval of the Board of Directors and the Manager.  The Manager will be responsible for the day-to-day operations of the Company and the Subsidiaries and will perform (or cause to be performed) such services and activities relating to the assets and operations of the Company and the Subsidiaries as may be appropriate, including, without limitation:

			
	
			
				 (i)
			serving as consultant to the Company and the Subsidiaries with respect to the periodic review of the investment guidelines and other parameters for the Investments, financing activities and operations, which review shall occur no less often than annually, any modification to which shall be approved by a majority of the Independent Directors (such guidelines as initially approved and attached hereto as Exhibit A, as the same may be modified, supplemented or waived with such approval, the “Investment Guidelines”);

			
	
			
				 (ii)
			representing and making recommendations to the Company and the Subsidiaries in connection with the origination and finance of, and commitment to originate and finance, commercial mortgage loans on and related equity interests in self-storage facilities (including on a portfolio basis), including conducting loan underwriting and the execution of loan transactions, as well as the purchase of real estate-related debt securities and other real estate-related assets, and the sale and commitment to sell such assets;

			
	
			
				 (iii)
			identifying, investigating, analyzing and selecting possible investment opportunities and originating, acquiring, financing, retaining, selling, restructuring or disposing of Investments consistent with the Investment Guidelines;

			
	
			
				 (iv)
			with respect to prospective purchases, sales or exchanges of Investments, conducting negotiations on behalf of the Company and the Subsidiaries with sellers, purchasers and brokers and, if applicable, their respective agents and representatives;

			
	
			
				 (v)
			negotiating and entering into, on behalf of the Company and the Subsidiaries, bank credit facilities, repurchase agreements, interest rate swap agreements and all other agreements and instruments required for the Company and the Subsidiaries to conduct its business;

		

		

		 

		

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				 (vi)
			engaging and supervising, on behalf of, and at the expense of, the Company and the Subsidiaries, independent contractors that provide investment banking, securities brokerage, mortgage brokerage and other financial services, due diligence services, underwriting review services, legal and account services, and all other services (including transfer agent and registrar services) as may be required relating to the Investments (or potential Investments) and, to the extent the Manager is able to negotiate same, procuring the direct payment by any borrower or other counterparty to any Investment of all third party costs, including, without limitation, legal fees and expenses, incurred in connection with such Investment, provided that such third party costs may be paid out of the proceeds of any Investment funded by the Company or the Operating Company

			
	
			
				 (vii)
			coordinating and managing operations of any joint venture or co-investment interests held by the Company and the Subsidiaries and conducting all matters with the joint venture or co-investment partners;

			
	
			
				 (viii)
			providing executive and administrative personnel, office space and office services required in rendering services to the Company and the Subsidiaries; 

			
	
			
				 (ix)
			administering the day-to-day operations and performing and supervising the performance of such other administrative functions necessary to the management of the Company and the Subsidiaries as may be agreed upon by the Manager and the Board of Directors, including, without limitation, services in respect of any equity incentive plans of the Company, the collection of revenues and the payment of debts and obligations of the Company and the Subsidiaries and maintenance of appropriate computer services to perform such administrative functions;

			
	
			
				 (x)
			communicating on behalf of the Company and the Subsidiaries with the holders of any of their equity or debt securities as required to satisfy the reporting and other requirements of any governmental bodies or agencies or trading markets and to maintain effective relations with such holders, including website maintenance, logo design, analyst presentations, investor conferences and annual meeting arrangements;

			
	
			
				 (xi)
			counseling the Company in connection with policy decisions to be made by the Board of Directors;

			
	
			
				 (xii)
			evaluating and recommending to the Board of Directors hedging strategies and engaging in hedging activities on behalf of the Company and the Subsidiaries, consistent with such strategies as modified from time to time, while maintaining the Company’s qualification as a REIT and within the Investment Guidelines;

			
	
			
				 (xiii)
			counseling the Company regarding the maintenance of its qualification as a REIT and monitoring compliance with the various REIT qualification tests and other rules set out in the Code and Treasury Regulations thereunder and using commercially reasonable efforts to cause the Company to qualify for taxation as a REIT;

			
	
			
				 (xiv)
			counseling the Company and the Subsidiaries regarding the maintenance of their exemptions from the status of an investment company required to register under the Investment Company Act, monitoring compliance with the requirements for maintaining such exemptions and using commercially reasonable efforts to cause them to maintain such exemptions from such status;

			
	
			
				 (xv)
			furnishing reports and statistical and economic research to the Company and the Subsidiaries regarding their activities and services performed for the Company and the Subsidiaries by the Manager;

			
	
			
				 (xvi)
			monitoring the operating performance of the Investments and providing periodic reports with respect thereto to the Board of Directors, including comparative information with respect to such operating performance and budgeted or projected operating results;

			
	
			
				 (xvii)
			investing and reinvesting any money and securities of the Company and the Subsidiaries (including investing in short-term Investments pending investment in other Investments, payment of fees, costs and expenses, or payment of dividends or distributions to stockholders and partners of the Company and the Subsidiaries) and advising the Company and the Subsidiaries as to their capital structure and capital raising;

			
	
			
				 (xviii)
			causing the Company and the Subsidiaries to retain qualified accountants and legal counsel, as applicable, to assist in developing appropriate accounting procedures and systems, internal controls and other compliance procedures and testing systems with respect to financial reporting obligations and compliance with the provisions of  the Code applicable to REITs and, if applicable, TRSs, and to conduct quarterly compliance reviews with respect thereto;

			
	
			
				 (xix)
			assisting the Company and the Subsidiaries in qualifying to do business in all applicable jurisdictions and to obtain and maintain all appropriate licenses;

		 

		

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				 (xx)
			assisting the Company and the Subsidiaries in complying with all regulatory requirements applicable to them with respect to their business activities, including preparing or causing to be prepared all financial statements required under applicable regulations and contractual undertakings and all reports and documents, if any, required under the Exchange Act, the Securities Act, or by the NYSE;

			
	
			
				 (xxi)
			assisting the Company and the Subsidiaries in taking all necessary action to enable them to make required tax filings and reports, including soliciting stockholders for all information required by the provisions of the Code and Treasury Regulations applicable to REITs;

			
	
			
				 (xxii)
			placing, or arranging for the placement of, all orders pursuant to the Manager’s investment determinations on behalf of the Company and the Subsidiaries, either directly with the issuer or with a broker or dealer (including any affiliated broker or dealer);

			
	
			
				 (xxiii)
			handling and resolving on behalf of the Company and/or the Subsidiaries all claims, disputes or controversies (including all litigation, arbitration, settlement or other proceedings or negotiations) in which the Company and/or the Subsidiaries may be involved or to which they may be subject arising out of their day-to-day operations (other than with the Manager or its Affiliates), subject to such limitations or parameters as may be imposed from time to time by the Board of Directors;

			
	
			
				 (xxiv)
			using commercially reasonable efforts to cause expenses incurred by the Company and the Subsidiaries or on their behalf to be commercially reasonable or commercially customary and within any budgeted parameters or expense guidelines set by the Board of Directors from time to time;

			
	
			
				 (xxv)
			advising the Company and the Subsidiaries with respect to (A) long-term financing vehicles for Investments and (B) the offering and selling of securities publicly or privately in connection with any such structured financing;

			
	
			
				 (xxvi)
			 serving as the Company’s and the Subsidiaries’ consultant with respect to decisions regarding any financings, hedging activities or borrowings undertaken by the Company and the Subsidiaries, including (A) assisting the Company and the Subsidiaries in developing criteria for debt and equity financing that are specifically tailored to their investment objectives, and (B) advising the Company and the Subsidiaries with respect to obtaining appropriate financing for the Investments;

			
	
			
				 (xxvii)
			 providing the Company and the Subsidiaries with portfolio management services and monitoring services as described below;

			
	
			
				 (xxviii)
			    arranging marketing materials, advertising, industry group activities (such as conference participations and industry organization memberships) and other promotional efforts designed to promote the Company’s and the Subsidiaries’ business;

			
	
			
				 (xxix)
			 performing such other services as may be required from time to time for the management of, and other activities relating to, the assets and business of the Company and the Subsidiaries as the Board of Directors shall reasonably request or as the Manager shall deem appropriate under the particular circumstances; and

			
	
			
				 (xxx)
			using commercially reasonable efforts to cause the Company and the Subsidiaries to comply with all applicable laws.

		
			Without limiting the foregoing, the Manager will perform portfolio management services (the “Portfolio Management Services”) on behalf of the Company and the Subsidiaries with respect to the Investments.  Such services will include, but not be limited to, consulting with the Company on the purchase and sale of, and other investment opportunities in connection with, the Investments; the collection of information and the submission of reports pertaining to the assets of the Company and the Subsidiaries, interest rates and general economic conditions; periodic review and evaluation of the performance of the Company’s and the Subsidiaries’ portfolio of assets; acting as a liaison between the Company and the Subsidiaries and banking, mortgage banking, investment banking and other parties with respect to the purchase, financing and disposition of assets; and other customary functions related to portfolio management.  Additionally, the Manager will perform monitoring services (the “Monitoring Services”) on behalf of the Company and the Subsidiaries with respect to any activities provided by third parties.  Such Monitoring Services will include, but not be limited to, negotiating servicing agreements; acting as a liaison between servicer providers of the assets and the Company and the Subsidiaries; reviewing servicers’ delinquency, foreclosure and other reports on assets; supervising claims filed under and insurance policies; and enforcing the obligation of any servicer to repurchase assets.
		

		

		

		 

		

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				 (c)
			For the period and on the terms and conditions set forth in this Agreement, the Company and each of the Subsidiaries hereby constitutes, appoints and authorizes the Manager as its true and lawful agent and attorney-in-fact, in its name, place and stead, to negotiate, execute and deliver and enter into such finance agreements and arrangements and securities repurchase and reverse repurchase agreements and arrangements, brokerage agreements, interest rate swap agreements, “to be announced” forward contracts, agreements relating to borrowings under programs established by the U.S. Government and/or any agencies thereunder and such other agreements, instruments and authorizations on their behalf, on such terms and conditions as the Manager, acting in its sole and absolute discretion, deems necessary or appropriate.  This power of attorney is deemed to be coupled with an interest.

			
	
			
				 (d)
			The Manager may enter into agreements with other parties, including its Affiliates, for the purpose of engaging one or more parties for and on behalf, and except as otherwise agreed or determined by the Manager, at the sole cost and expense, of the Company and the Subsidiaries, to provide credit analysis, risk management services, asset management and/or other services to the Company  and the Subsidiaries (including, without limitation Portfolio Management Services and Monitoring Services) pursuant to the agreement(s) with terms that are then customary for agreements regarding the provision of services to companies that have assets similar in type, quality and value to the assets of the Company and the Subsidiaries; provided that (i) any such agreements entered into with Affiliates of the Manager shall be (A) on terms no more favorable to such Affiliate than would be obtained from an independent third party on an arm’s length basis and (B) approved by a majority of the Independent Directors, (ii) any such agreements entered into with parties other than Affiliates of the Manager shall be approved by a majority of the Independent Directors, and (iii) the Manager shall remain liable for the performance of such Portfolio Management Services and Monitoring Services.  

			
	
			
				 (e)
			To the extent that the Manager deems necessary or advisable, the Manager may, from time to time, propose to retain one or more additional entities for the provision of sub-advisory services to the Manager in order to enable the Manager to provide the services to the Company and the Subsidiaries specified by this Agreement; provided that any such agreement (i) shall be on terms and conditions substantially identical to the terms and conditions of this Agreement or otherwise not adverse to the Company and the Subsidiaries, (ii) shall not result in an increased Base Management Fee or additional expenses payable hereunder, and (iii) shall be approved by a majority of the Independent Directors of the Company.

			
	
			
				 (f)
			The Manager may retain, for and on behalf and, at the sole cost and expense of the Company and the Subsidiaries (except such cost and expense as may be directly paid or reimbursed to the Manager by any unaffiliated third party), such services of accountants, legal counsel, consultants, data providers, appraisers, insurers, brokers, transfer agents, registrars, investment banks, financial advisors, due diligence firms, banks and other lenders and others as the Manager deems necessary or advisable in connection with the management and operations of the Company and the Subsidiaries.  Notwithstanding anything contained herein to the contrary, the Manager shall have the right to cause any such services to be rendered by its employees or Affiliates.  Except as otherwise provided herein and except to the extent directly paid or reimbursed to the Manager by any unaffiliated third party, the Company and the Subsidiaries shall pay or reimburse the Manager or its Affiliates performing such services for the cost thereof; provided that such costs and reimbursements are (A) no greater than those which would be payable to outside professional or consultants engaged to perform such services pursuant to agreements negotiated on an arm’s length basis and (B) approved by a majority of the Independent Directors.

			
	
			
				 (g)
			As frequently as the Manager may deem necessary or advisable, or at the direction of the Company’s Board of Directors, the Manager shall, at the sole cost and expense of the Company and the Subsidiaries, prepare, or cause to be prepared, with respect to any Investment, reports and other information reasonably requested by the Company.

			
	
			
				 (h)
			The Manager shall prepare, or cause to be prepared, at the sole cost and expense of the Company and the Subsidiaries, all reports, financial or otherwise, with respect to the Company and the Subsidiaries reasonably required by the Company’s Board of Directors in order for the Company or the Subsidiaries to comply with their Governing Instruments or any other materials required to be filed with any governmental body or agency, including but not limited to, the SEC, and shall prepare, or cause to be prepared, all materials and data necessary to complete such reports and other materials including, without limitation, an annual audit of the Company’s and the Subsidiaries’ books of account by a nationally recognized independent registered public accounting firm.

			
	
			
				 (i)
			The Manager shall prepare regular reports for the Board of Directors to enable the Board of Directors to review the Company’s and the Subsidiaries’ acquisitions, portfolio composition and characteristics, credit quality, performance and compliance with the Investment Guidelines and other policies approved by the Board of Directors.

			
	
			
				 (j)
			If requested by the Company or the Subsidiaries, the Manager shall provide such internal audit, compliance and control services as may be required for the Company and the Subsidiaries to comply with applicable law (including the Securities Act and the Exchange Act), regulation (including SEC regulations) and the rules and requirements of the NYSE or such other securities exchange on which the Common Stock may be listed and as otherwise reasonably requested by the Board of Directors from time to time.

		 

		

			8

		

		

			 

		

 

			
	
			
				 (k)
			The Manager shall establish an Investment Committee (the “Investment Committee”) that will oversee, advise and consult with respect to the Company’s investment strategy, acquisition of Investments, sourcing, financing and leveraging strategies and compliance with the Investment Guidelines.  The Investment Committee will meet periodically, as many times as necessary but no less than once every quarter, to discuss investment opportunities.  The Investment Committee will periodically review the Company’s investment portfolio and its compliance with the Investment Guidelines, and provide the Board of Directors an investment report at the end of each quarter in conjunction with its review of the quarterly results of the Company.  

			
	
			
				 (l)
			Notwithstanding anything contained in this Agreement to the contrary, except to the extent that the payment of additional money is proven by the Company to have been required as a direct result of the Manager’s acts or omissions which result in the right of the Company and the Subsidiaries to terminate the Agreement pursuant to Section 14 of this Agreement, the Manager shall not be required to expend money (“Excess Funds”) in connection with any expenses that are required to be paid for or reimbursed by the Company and the Subsidiaries pursuant to Section 10 in excess of that contained in any applicable Company Account or otherwise made available by the Company and the Subsidiaries to be expended by the Manager hereunder.  Failure of the Manager to spend Excess Funds out-of-pocket shall not give rise or be a contributing factor to the right of the Company under Section 13(a) of this Agreement to terminate this Agreement due to the Manager’s unsatisfactory performance.

			
	
			
				 (m)
			In performing its duties under this Section 2, the Manager shall be entitled to rely reasonably on qualified experts and professionals (including, without limitation, accountants, legal counsel and other service providers) hired by the Manager at the Company’s and the Subsidiaries’ sole cost and expense, unless otherwise determined at the Manager’s discretion.

		
			Section 3.  Devotion of Time; Additional Activities.
		

			
	
			
				 (a)
			The Manager and its Affiliates will provide the Company and the Subsidiaries with a management team, including a chief executive officer and chief financial officer or similar positions, along with appropriate support personnel, to provide the management services to be provided by the Manager to the Company and the Subsidiaries hereunder, the members of which team shall devote such portion of their time to the management of the Company and the Subsidiaries as is necessary and appropriate to enable the Company and the Subsidiaries to operates its business, commensurate with the Company’s and the Subsidiaries’ level of activity. The Manager shall provide reasonable access to their respective investment professionals in order to support the day-to-day operations of the Company and the Subsidiaries.  Notwithstanding anything to the contrary herein, for so long as the Manager is managing the Company pursuant to this Agreement, neither it nor any of its Affiliates will sponsor or manage any other U.S. publicly traded REIT. 

			
	
			
				 (b)
			Managers, partners, officers, employees, personnel and agents of the Manager or Affiliates of the Manager may serve as directors, officers, employees, partners, personnel, agents, nominees or signatories for the Company and the Subsidiaries to the extent permitted by their Governing Instruments or by any resolutions duly adopted by the Board of Directors pursuant to the Company’s Governing Instruments. When executing documents or otherwise acting in such capacities for the Company and the Subsidiaries, such persons shall use their respective titles in the Company and the Subsidiaries.

			
	
			
				 (c)
			Subject to Section 2(d), the Manager is authorized, for and on behalf, and at the sole cost and expense of the Company to employ securities dealers for the purchase and sale of Investments as the Manager deems necessary or appropriate, in its sole discretion.

			
	
			
				 (d)
			The Company (including the Board of Directors) agrees to take, or cause to be taken, all actions reasonably required to permit and enable the Manager to carry out its duties and obligations under this Agreement, including, without limitation, all steps reasonably necessary to allow the Manager to file any registration statement on behalf of the Company and the Subsidiaries in a timely manner or to deliver any financial statements or other reports with respect to the Company and the Subsidiaries.

		
			Section 4.  Agency.  The Manager shall act as agent of the Company and the Subsidiaries in making, acquiring, financing and disposing of Investments, disbursing and collecting the funds of the Company and the Subsidiaries, paying the debts and fulfilling the obligations of the Company and the Subsidiaries, supervising the performance of professionals engaged by or on behalf of the Company and the Subsidiaries and handling, prosecuting and settling any claims of or against the Company and the Subsidiaries, the Board of Directors, holders of the Company’s and the Subsidiaries’ securities or representatives or assets of the Company and the Subsidiaries.
		

		
			Section 5.  Bank Accounts.  At the direction of the Board of Directors, the Manager may establish and maintain as an agent on behalf of the Company of the Subsidiaries one or more bank accounts in the name of the Company or the Subsidiaries, the Operating Company or any subsidiary (any such account, a “Company Account”), and may collect and deposit funds into any such Company Account or Company Accounts, and disburse funds from any such Company Account, under such terms and conditions as the Board of Directors may approve and the Manager shall from time to time render appropriate accountings of such collections and payments to the Board of Directors and, upon request, to the auditors of the Company or any Subsidiaries.
		

		

		

		 

		

			9

		

		

			 

		

 

		Section 6.  Records; Confidentiality.  
		

			
	
			
				 (a)
			The Manager shall maintain appropriate books of accounts and records relating to services performed under this Agreement, and such books of account and records shall be accessible for inspection by representatives of the Company and the Subsidiaries at any time during normal business hours.

			
	
			
				 (b)
			The Manager shall keep confidential any and all information obtained in connection with the services rendered under this Agreement and shall not disclose any such information (or use the same except in furtherance of its duties under this Agreement) to unaffiliated third parties, except: (i) with the prior written consent of the Board of Directors; (ii) to legal counsel, accountants and other professional advisors; (iii) to appraisers, financing sources and others in the ordinary course of the Company’s business; (iv) to governmental officials having jurisdiction over the Company or the Subsidiaries; (v) in connection with any governmental or regulatory filings of the Company or the Subsidiaries, or disclosure or presentations to Company investors; (vi) as required by law or legal process to which the Manager or any Person to whom disclosure is permitted hereunder is a party; or (vii) to the extent such information is otherwise publicly available through the actions of a Person other than the Manager not resulting from the Manager’s violation of this Section 6. The provisions of this Section 6(b) shall survive the expiration or earlier termination of this Agreement for a period of one year.

		
			Section 7.  Obligations of Manager; Restrictions.
		

			
	
			
				 (a)
			The Manager shall require each seller or transferor of Investments to the Company and the Subsidiaries to make such representations and warranties regarding such assets as may, in the judgment of the Manager, be necessary and appropriate. In addition, the Manager shall take such other action as it deems necessary or appropriate with regard to the protection of the Investments.

			
	
			
				 (b)
			The Manager shall refrain from any action that, in its sole judgment made in good faith:

			
	
			
				 (i)
			is not in compliance with the Investment Guidelines;

			
	
			
				 (ii)
			would adversely and materially affect the qualification of the Company as a REIT under the Code; 

			
	
			
				 (iii)
			would adversely and materially affect the Company’s or any Subsidiary’s status as an entity intended to be exempted or excluded from investment company status under the Investment Company Act; or

			
	
			
				 (iv)
			would violate any law, rule or regulation of any governmental body or agency having jurisdiction over the Company or any Subsidiary or that would otherwise not be permitted by the Company’s Governing Instruments, code of conduct, or other compliance or governance policies and procedures.

		
			If the Manager is ordered to take any such action by the Board of Directors, the Manager shall promptly notify the Board of Directors of the Manager’s judgment that such action would adversely and materially affect such status or violate any such law, rule or regulation or the Company’s Governing Instruments. Notwithstanding the foregoing, the Manager and its officers, directors, members, managers and employees shall not be liable to the Company or any Subsidiary or to any director or stockholder of the Company or any Subsidiary for acts or omissions performed in accordance with and pursuant to this Agreement, except as provided in Section 12 of this Agreement.
		

			
	
			
				 (c)
			The Board of Directors shall periodically review the Investment Guidelines and the Company’s portfolio of Investments, but will not review each proposed investment, except as provided in the Investment Guidelines. If a majority of the Independent Directors determine in their periodic review of transactions that a particular transaction does not comply with the Investment Guidelines, then a majority of the Independent Directors will consider what corrective action, if any, can be taken. The Manager shall be permitted to rely upon the direction of the Secretary of the Company to evidence the approval of the Board of Directors or the Independent Directors with respect to a proposed investment.

			
	
			
				 (d)
			The Manager agrees to be bound by all policies and procedures, including the Company’s code of conduct and other compliance and governance policies and procedures, applicable to the Manager and its officers, directors, members, managers and employees that are adopted by the Board of Directors from time to time, including those required under the Exchange Act, the Securities Act, or by the NYSE, and to take, or cause to be taken, all actions reasonably required to cause its officers, directors, members, managers and employees, and any principals, officers or employees of its Affiliates who are involved in the business and affairs of the Company and the Subsidiaries, to be bound by such policies and procedures to the extent applicable to such persons.

		

		

		 

		

			10

		

		

			 

		

 

		
		

			
	
			
				 (e)
			The Manager shall at all times during the term of this Agreement maintain “errors and omissions” insurance coverage and other insurance coverage that is customarily carried by asset and investment managers performing functions similar to those of the Manager under this Agreement with respect to assets similar to the assets of the Company and the Subsidiaries, in an amount which is comparable to that customarily maintained by other managers or servicers of similar assets.

		
			Section 8.  Base Management Fee.
		

			
	
			
				 (a)
			During the Initial Term and any Renewal Term, the Company shall pay the Manager the Base Management Fee quarterly in arrears, in cash.  The Base Management Fee is payable independent of the performance of the Company or the Investments.

			
	
			
				 (b)
			The Manager shall calculate each installment of the Base Management Fee within 30 days after the end of the fiscal quarter with respect to which such installment is payable. A copy of such calculation made by the Manager shall thereafter promptly be delivered to the Board of Directors and, upon such delivery, payment of such installment of the Base Management Fee shown therein shall, subject in any event to Section 13(a) of this Agreement, be due and payable in cash no later than the date which is five Business Days after the date of delivery to the Board of Directors of the written statement of the Manager setting forth the computation of the management fee for such quarter.

			
	
			
				 (c)
			The Base Management Fee is subject to adjustment pursuant to and in accordance with the provisions of Section 13(a) of this Agreement.

		
			Section 9.  Incentive Fee.
		

		
			The Incentive Fee shall be payable in arrears, in cash, with respect to each fiscal quarter. The Manager shall calculate each quarterly installment of the Incentive Fee within 45 days after the end of the fiscal quarter with respect to which such installment is payable and promptly deliver such calculation to the Board of Directors and, upon such delivery, payment of such installment of the Incentive Fee shown therein shall, subject in any event to Section 13(a) of this Agreement, be due and payable no later than the date which is five Business Days after the date of delivery to the Board of Directors of such calculation.
		

		
			Section 10.  Expenses of the Company.  
		

			
	
			
				 (a)
			The Company and the Subsidiaries shall pay all of the expenses of the Company and the Subsidiaries and shall reimburse the Manager for documented expenses of the Manager incurred on behalf of the Company and the Subsidiaries (collectively, the “Expenses”) excepting only those expenses that are specifically the responsibility of the Manager pursuant to Section 2 of this Agreement. Such costs and reimbursements shall not be in amounts greater than those which would be payable to outside professionals or consultants engaged to perform such services pursuant to agreements negotiated on an arm’s length basis. For the avoidance of doubt, in the event any Expense is paid directly by an unaffiliated third party or the Manager is reimbursed (whether or not out of funds provided by the Company or the Operating Company in connection with any Investment) by an unaffiliated third party for any Expense incurred by the Manager, the amount of Expenses to be reimbursed to the Manager by the Company and the Subsidiaries pursuant to this Section 10(a) shall be reduced dollar-for-dollar by the amount of any such payment or reimbursement. Subject to but without limiting the generality of the foregoing, except to the extent directly paid or reimbursed by an unaffiliated third party, it is specifically agreed that the following costs and expenses of the Company and the Subsidiaries shall be paid by the Company and the Subsidiaries and shall not be paid by the Manager or Affiliates of the Manager, unless the Manager elects not to seek such reimbursement pursuant to Section 10(b):

			
	
			
				 (i)
			expenses in connection with the issuance and transaction costs incident to the origination, acquisition, disposition and financing of Investments;

			
	
			
				 (ii)
			the costs of legal, financial, tax, accounting, servicing, due diligence consulting, auditing and other similar services rendered for the Company and the Subsidiaries by providers retained by the Manager;

			
	
			
				 (iii)
			the compensation and expenses of the Company’s directors;

			
	
			
				 (iv)
			 the compensation expense for employees of the Manager, other than the Manager’s chief executive officer and chief financial officer and such other employees of the Manager with respect to which the Manager shall agree to assume such cost without reimbursement;

		 

		

			11

		

		

			 

		

 

			
	
			
				 (v)
			the cost of liability insurance to indemnify the Company’s directors and officers and the Company’s allocable portion of the fidelity bond, directors and officers/errors and omissions liability insurance, and any other insurance premium;

			
	
			
				 (vi)
			costs associated with the establishment and maintenance of any of the Company’s and the Subsidiaries’ secured funding facilities, other financing arrangements, or other indebtedness of the Company and the Subsidiaries (including commitment fees, accounting fees, legal fees, closing and other similar costs) or any of the Company’s or the Subsidiaries’ securities offerings;

			
	
			
				 (vii)
			expenses connected with communications to holders of the Company’s and the Subsidiaries’ securities and other bookkeeping and clerical work necessary in maintaining relations with holders of such securities and in complying with the continuous reporting and other requirements of governmental bodies or agencies, including all costs of preparing and filing required reports with the SEC, the costs payable by the Company and the Subsidiaries to any transfer agent and registrar in connection with the listing and/or trading of the Company’s or the Subsidiaries’ securities on any exchange, the fees payable by the Company and the Subsidiaries to any such exchange in connection with its listing, costs of preparing, printing and mailing the Company’s annual report to the Company stockholders and proxy materials with respect to any meeting of the Company’s stockholders;

			
	
			
				 (viii)
			costs associated with any computer software or hardware, electronic equipment or purchased information technology services from third-party vendors that is used for the Company;

			
	
			
				 (ix)
			expenses incurred by managers, officers, personnel and agents of the Manager for travel on the Company’s or any Subsidiary’s behalf and other out-of-pocket expenses incurred by managers, officers, personnel and agents of the Manager in connection with the purchase, financing, refinancing, sale or other disposition of an investment or establishment and maintenance of any of the Company’s or the Subsidiaries’ securitizations or any of the Company’s or the Subsidiaries’ securities offerings;

			
	
			
				 (x)
			costs and expenses incurred with respect to market information systems and publications, research publications and materials, and settlement, clearing and custodial fees and expenses;

			
	
			
				 (xi)
			compensation and expenses of the Company’s or any Subsidiaries’ custodian and transfer agent, if any;

			
	
			
				 (xii)
			the costs of maintaining compliance with all federal, state and local rules and regulations or any other regulatory agency;

			
	
			
				 (xiii)
			all federal, state and local taxes and license fees;

			
	
			
				 (xiv)
			all insurance costs incurred in connection with the operation of the Company’s  and the Subsidiaries’ business, except for the costs attributable to the insurance that the Manager elects to carry for itself or its personnel related to any business or other activity not involving the Company;

			
	
			
				 (xv)
			costs and expenses incurred in contracting with third parties for or on behalf of the Company;

			
	
			
				 (xvi)
			all other costs and expenses relating to the Company’s and the Subsidiaries’ business and investment operations, including the costs and expenses of originating, acquiring, owning, protecting, maintaining, developing and disposing of investments, including appraisal, reporting, audit and legal fees;

			
	
			
				 (xvii)
			expenses (including rent, telephone, printing, mailing, utilities, office furniture, equipment, machinery and other office, internal and overhead expenses) relating to any office(s) or office properties, including disaster backup recovery sites and properties, incurred by the Manager;

			
	
			
				 (xviii)
			expenses connected with the payments of interest, dividends or distributions in cash or any other form authorized or caused to be made by the Board of Directors to or on account of holders of the Company’s securities, including in connection with any dividend reinvestment plan;

			
	
			
				 (xix)
			any judgment or settlement of pending or threatened proceedings (whether civil, criminal or otherwise) against the Company or any Subsidiary, or against any trustee, director, partner, member or officer of the Company or any Subsidiary, or in his or her capacity as such for which the Company or any Subsidiary is required to indemnify such trustee, director, partner, member or officer by any court or governmental agency; and

		 

		

			12

		

		

			 

		

 

			
	
			
				 (xx)
			all other expenses actually incurred by the  Manager (except as described below) which are reasonably necessary for the performance by the Manager of its duties and functions under this Agreement.

			
	
			
				 (b)
			The Manager may, at its option, elect not to seek reimbursement for certain expenses during a given quarterly period, which determination shall not be deemed to construe a waiver of reimbursement for similar expenses in future periods.

		
			Section 11. Calculations of Expenses.  The Manager shall prepare a statement documenting the Expenses during each fiscal quarter, and shall deliver such statement to the Company within 30 days after the end of each fiscal quarter. Expenses shall be reimbursed by the Company and the Subsidiaries to the Manager no later than the 15th Business Day immediately following the date of delivery of such statement; provided, however, that such reimbursements may be offset by the Manager against amounts due to the Company or the Subsidiaries. The provisions of this Section 11 shall survive the expiration or earlier termination of this Agreement.
		

		
			Section 12.  Limits of the Manager’s Responsibility; Indemnification.
		

			
	
			
				 (a)
			The Manager assumes no responsibility under this Agreement other than to render the services called for under this Agreement in good faith and shall not be responsible for any action of the Board of Directors in following or declining to follow any advice or recommendations of the Manager, including as set forth in Section 7(b) of this Agreement. The Manager and its officers, employees, members and managers (each a “Covered Person”) will not be liable to the Company or any Subsidiary, the Board of Directors, or the Company’s or any Subsidiary’s stockholders or partners for any acts or omissions by any such Covered Person performed in accordance with and pursuant to this Agreement, except by reason of acts or omissions constituting bad faith, willful misconduct, gross negligence or reckless disregard of the Manager’s duties under this Agreement. The Manager will maintain reasonable and customary insurance coverages. 

			
	
			
				 (b)
			The Company to the full extent permitted by law shall indemnify and hold harmless each Covered Person from and against with respect to all expenses, losses, damages, liabilities, demands, charges and claims in respect of or arising from any acts or omissions of the Manager and the officers, employees, members and managers of the Manager, performed in good faith under this Agreement and not constituting bad faith, willful misconduct, gross negligence, or reckless disregard of their respective duties under this Agreement.

			
	
			
				 (c)
			The Manager to the full extent permitted by law shall indemnify and hold harmless the Company and the Subsidiaries and each of the directors, officers and stockholders of the Company and the Subsidiaries with respect to all expenses, losses, damages, liabilities, demands, charges and claims in respect of or arising from any acts or omissions of the Manager constituting bad faith, willful misconduct, gross negligence or reckless disregard of its duties under this Agreement or any claims by the Manager’s employees relating to the terms and conditions of their employment by the Manager. 

			
	
			
				 (d)
			The provisions of this Section 12 shall survive the expiration or earlier termination of this Agreement.

		
			Section 13.  Term; Termination.
		

			
	
			
				 (a)
			Unless this Agreement is terminated earlier for cause in accordance with Section 14 below, this Agreement shall be in effect until March 31, 2020 (the “Initial Term”) and shall be automatically renewed for a one-year term each anniversary date thereafter (a “Renewal Term”) for a maximum of three one-year terms, unless previously terminated as provided below.  Following the Initial Term, this Agreement may be terminated annually upon the affirmative vote of at least two-thirds of the Independent Directors based on a determination that (i) there has been unsatisfactory performance by the Manager that is materially detrimental to the Company and the Subsidiaries taken as a whole or (ii) the compensation payable to the Manager is unfair to the Company and the Subsidiaries; provided that the Company shall not have the right to terminate this Agreement under clause (ii) above if the Manager agrees to continue to provide the services under this Agreement at a reduced fee that at least two-thirds of the Independent Directors determines to be fair pursuant to the procedure set forth below.  If the Company elects not to renew this Agreement at the expiration of the Initial Term or any Renewal Term as set forth above, the Company shall deliver to the Manager prior written notice (the “Termination Notice”) of the Company’s intention not to renew this Agreement based upon the terms set forth in this Section 13(a) not less than 180 days prior to the expiration of the then existing term. If the Company so elects not to renew this Agreement, the Company shall designate the date (the “Effective Termination Date”), not less than 180 days from the date of the notice, on which the Manager shall cease to provide services under this Agreement, and this Agreement shall terminate on such date; provided, however, that in the event that such Termination Notice is given in connection with a determination that the compensation payable to the Manager is unfair, the Manager shall have the right to renegotiate such compensation by delivering to the Company, no fewer than 45 days prior to the prospective Effective Termination Date, written notice (any such notice, a “Notice of Proposal to Negotiate”) of its intention to renegotiate its compensation under this Agreement. Thereupon, the Company (represented by the Independent Directors) 
		

		 

		

			13

		

		

			 

		

 

			and the Manager shall endeavor to negotiate in good faith the revised compensation payable to the Manager under this Agreement. Provided that the Manager and at least two-thirds of the Independent Directors agree to the terms of the revised compensation to be payable to the Manager within 45 days following the receipt of the Notice of Proposal to Negotiate, the Termination Notice shall be deemed of no force and effect and this Agreement shall continue in full force and effect on the terms stated in this Agreement, except that the compensation payable to the Manager hereunder shall be the revised compensation then agreed upon by the parties to this Agreement. The Company and the Manager agree to execute and deliver an amendment to this Agreement setting forth such revised compensation promptly upon reaching an agreement regarding same. In the event that the Company and the Manager are unable to agree to the terms of the revised compensation to be payable to the Manager during such 45-day period, this Agreement shall terminate, such termination to be effective on the date which is the later of (A) 10 days following the end of such 45-day period and (B) the Effective Termination Date originally set forth in the Termination Notice.  Notwithstanding anything in this paragraph (a) or this Agreement to the contrary, termination of this Agreement shall only occur for the reasons set forth in the second sentence of this paragraph (a) and in Section 14.  The parties agree that currently, and since the initial effective date of this Agreement, it is and has been the intention of the parties that if the Agreement is not terminated in the manner set forth in paragraph (a) above or Section 14, then the Company and the Manager (or the equity owners of the Manager) shall effect an Internalization Transaction pursuant to Section 17, whether at the end of the Initial Term or any Renewal Term.

			
	
			
				 (b)
			In recognition of the upfront effort required by the Manager to structure and acquire the assets of the Company and the Subsidiaries and the commitment of resources by the Manager, in the event that this Agreement is terminated in accordance with the provisions of  Section 13(a) or Section 14(b) of this Agreement, the Company shall pay to the Manager, on the date on which such termination is effective, a termination fee (the “Termination Fee”) equal to the greater of (i) three times the sum of the average annual Base Management Fee and Incentive Fee earned by the Manager during the 24-month period prior to such termination, calculated as of the end of the most recently completed fiscal quarter prior to the date of termination, or (ii) the Internalization Price (as defined in Section 17(e) below, without regard to clause (B) in the definition of Internalization Price set forth in Section 17(e)). Any Termination Fee will be payable by the Operating Company in cash. The obligation of the Company to pay the Termination Fee shall survive the termination of this Agreement.

			
	
			
				 (c)
			No later than 180 days prior to the expiration of the Initial Term or Renewal Term, the Manager may deliver written notice to the Company informing it of the Manager’s intention to decline to renew this Agreement, whereupon this Agreement shall not be renewed and extended and this Agreement shall terminate effective on the anniversary date of this Agreement next following the delivery of such notice. The Company shall not be required to pay the Termination Fee to the Manager if the Manager terminates this Agreement pursuant to this Section 13(c).

		
			Section 14.  Termination for Cause.
		

			
	
			
				 (a)
			The Company may terminate this Agreement at any time, including during the Initial Term, upon at least 30 days’ prior written notice of termination from the Board of Directors to the Manager, without payment of any Termination Fee, if:

			
	
			
				 (i)
			the Manager breaches this Agreement in any material respect and such breach shall continue for a period of 30 days after written notice thereof specifying such breach and requesting that the same be remedied in such 30-day period;

			
	
			
				 (ii)
			there is a commencement of any proceeding relating to the Bankruptcy or insolvency of the Manager, including an order for relief in an involuntary Bankruptcy case or the authorization or filing by the Manager of a voluntary Bankruptcy petition;

			
	
			
				 (iii)
			there is a Manager Change of Control and a majority of the Independent Directors reasonably determines that such Manager Change of Control is materially detrimental to the Company;

			
	
			
				 (iv)
			the Manager engages in any act of bad faith, willful misconduct, fraud, misappropriation of funds, or embezzlement against the Company or any Subsidiary;

			
	
			
				 (v)
			there is an act or omission that constitutes gross negligence on the part of the Manager in the performance of its duties under this Agreement; 

			
	
			
				 (vi)
			there is a dissolution of the Manager;

		

		

		 

		

			14

		

		

			 

		

 

		
		

			
	
			
				 (vii)
			the Manager fails to provide adequate or appropriate personnel that are reasonably necessary for the Manager to identify investment opportunities for the Company and the Subsidiaries and to manage and develop the Company’s and the Subsidiaries’ investment portfolios, if such default continues uncured for a period of 60 days after written notice thereof, which notice must contain a request that the same be remedied;

			
	
			
				 (viii)
			the Manager is convicted (including a plea of nolo contendere) of a felony; or

			
	
			
				 (ix)
			Both Dean Jernigan and John Good are no longer senior executive officers of the Manager or the Company during the term of the Agreement or, in the event of an assignment of this Agreement to an Affiliate of the Manager pursuant to Section 16 of this Agreement, of the Affiliate, other than by reason of death or disability. For the avoidance of doubt, so long as one of Dean Jernigan or John Good remains as a senior executive officer of the Manager or the Company devoting full-time attention to the Manager or the Company during the term of the Agreement, or in the event of an assignment of this Agreement to an Affiliate of the Manager pursuant to Section 16 of this Agreement, of such Affiliate, this Agreement will remain in full force and effect.  

			
	
			
				 (b)
			The Manager may terminate this Agreement effective upon 60 days’ prior written notice of termination to the Company in the event that the Company shall default in the performance or observance of any material term, condition or covenant contained in this Agreement and such default shall continue for a period of 30 days after written notice thereof specifying such default and requesting that the same be remedied in such 30-day period (or 60 days after written notice of such breach if the Company takes steps to cure such breach within 30 days of the written notice).  The Company is required to pay to the Manager the Termination Fee if the termination of this Agreement is made pursuant to this Section 14(b).

			
	
			
				 (c)
			The Manager may terminate this Agreement in the event the Company becomes regulated as an “investment company” under the Investment Company Act, with such termination deemed to have occurred immediately prior to such event. If the Manager terminates this Agreement pursuant to this Section 14(c), the Company shall not be required to pay the Termination Fee.

		
			Section 15.  Survival; Action Upon Termination.  From and after the effective date of termination of this Agreement, pursuant to Sections 13 or 14 of this Agreement, the Manager shall not be entitled to compensation for further services under this Agreement, but shall be paid all compensation accruing to the date of termination and, if terminated pursuant to Section 13(a) or 14(b), the applicable Termination Fee. Upon such termination, the Manager shall forthwith:
		

			
	
			
				 (i)
			after deducting any accrued compensation and reimbursement for Expenses to which it is then entitled, pay over to the Company all money collected and held for the account of the Company pursuant to this Agreement;

			
	
			
				 (ii)
			deliver to the Board of Directors a full accounting, including a statement showing all payments collected by it and a statement of all money held by it, covering the period following the date of the last accounting furnished to the Board of Directors with respect to the Company; and

			
	
			
				 (iii)
			deliver to the Board of Directors all property and documents of the Company or any subsidiary then in the custody of the Manager.

		
			Sections 6,  10,  11,  12,  13,  14,  15 and 25 shall survive the termination of this Agreement.
		

		
			Section 16.  Assignment.  Subject to Section 14(a), the Manager may assign the agreement in its entirety or delegate certain of its duties under the Agreement to any of its Affiliates without the approval of the Independent Directors; provided that any such assignment or delegation does not require the approval of the Independent Directors under the Investment Company Act.  Any other assignment by the Manager must be consented to in writing by the Company with the approval of a majority of the Independent Directors.  Any permitted assignment shall bind the assignee under this Agreement in the same manner as the Manager is bound, and the Manager shall be liable to the Company for all errors or omissions of the assignee under any such assignment. In addition, the assignee shall execute and deliver to the Company a counterpart of this Agreement naming such assignee as Manager. This Agreement shall not be assigned by the Company without the prior written consent of the Manager, except in the case of assignment by the Company to another REIT or other organization which is a successor (by merger, consolidation, purchase of assets, or other transaction) to the Company, in which case such successor organization shall be bound under this Agreement and by the terms of such assignment in the same manner as the Company is bound under this Agreement.
		

		

		

		 

		

			15

		

		

			 

		

 

		Section 17. Internalization of the Manager.  
		

			
	
			
				 (a)
			No later than 180 days prior to the end of the Initial Term, the Manager shall provide the Company with an offer for an Internalization Transaction with the Operating Company on such terms and conditions included in a written offer provided by the Manager.  The offer price will be based on the following financial framework:  the lesser of the two amounts determined pursuant to the Internalization Formulas.  Upon receipt of the Manager’s initial Internalization Transaction offer, a special committee consisting solely of the Company’s independent directors may accept the Manager’s proposal or submit a counter offer to the Manager.  If the Company and the Manager agree upon an Internalization Price pursuant to this Section 17(a), the Company shall seek satisfaction of the conditions set forth in Section 17(c).

			
	
			
				 (b)
			If an Internalization Transaction is not consummated pursuant to Section 17(a), the Manager will annually submit to the Company a new offer for an Internalization Transaction with the Operating Company, with an Internalization Price based on the financial framework set forth in Section 17(a), not later than 180 days prior to the end of any Renewal Term until termination of this Agreement. The special committee of the Company’s board of directors and the Manager will follow the same process set forth in Section 17(a) with respect to each Internalization Transaction offer by the Manager.  If the Company and the Manager agree upon an Internalization Price pursuant to this Section 17(b), the Company shall seek satisfaction of the conditions set forth in Section 17(c).  Notwithstanding the foregoing or any other provision in this Agreement to the contrary, if an Internalization Transaction has not been consummated in the manner set forth in this Section 17 prior to the end of the last Renewal Term of this Agreement, then on the last day of the last Renewal Term, the Manager and the Company shall consummate an Internalization Transaction effective as of the last day of the last Renewal Term.  In the event an Internalization Transaction is consummated, at the time of consummation of such Internalization Transaction, all assets of the Manager shall be conveyed to and acquired by the Company in exchange for the Internalization Price, computed in accordance with paragraph (e) below and payable pursuant to paragraph (d) below, all employees of the Manager shall become employees of the Company, the Company shall succeed to all customer and other relationships then possessed by the Manager and the Manager shall discontinue all business activities.  The parties expressly agree that an Internalization Transaction that is effected at the end of the last Renewal Term of this Agreement shall not be subject to the conditions of paragraph (c) below and shall be in lieu of any termination of this Agreement and the payment of any Termination Fee, it being the express intention of the parties that no Termination Fee shall be payable in the event of expiration of this Agreement at the end of its final Renewal Term and, instead, the Company shall acquire the business of the Manager at that time for the Internalization Price determined in accordance with Section 17(e) of this Agreement.  The parties mutually agree to execute such additional agreements, documents and instruments as may be reasonably required to effect the Internalization Transaction and convey the Manager’s assets (or the equity interests in the Manager) to the Company.     

			
	
			
				 (c)
			Consummation of any Internalization Transaction agreed to between the Company and the Manager is conditioned upon the satisfaction of the following conditions:

			
	
			
				 (i)
			The Company’s receipt of a fairness opinion from a nationally-recognized investment banking firm to the effect that the consideration to be paid by the Company (or the Operating Company) for the assets and equity of the Manager is fair, from a financial point of view, to holders of the Common Stock who are not affiliated with the Manager or its Affiliates;

			
	
			
				 (ii)
			The approval of the acquisition by a special committee of the Company’s Board of Directors comprised solely of Independent Directors; and

			
	
			
				 (iii)
			The approval of Company stockholders holding a majority of the votes cast on such Internalization proposal at a meeting of stockholders duly called and at which a quorum is present.

			
	
			
				 (d)
			The Internalization Price paid to the Manager in any Internalization Transaction will be payable by the Operating Company in the number of OC Units equal to the agreed upon Internalization Price, divided by the volume-weighted average of the closing market price of the Common Stock for the ten consecutive trading days immediately preceding the date with respect to which value must be determined; provided, however, that if the Company’s Common Stock is not traded on a national securities exchange at the time of closing of any such Internalization Transaction, then the number of OC Units shall be determined by agreement between the Board of Directors and the Manager or, in the absence of such agreement, the Internalization Price shall be paid in cash.

		

		

		 

		

			16

		

		

			 

		

 

		
		

			
	
			
				 (e)
			Upon any Internalization pursuant to this Section 17, the Manager shall not be entitled to the receipt of any Termination Fee.  The “Internalization Price” for purposes of Section 13(b), shall be determined as follows:  (A) if an Internalization Transaction occurs prior to the end of the last Renewal Term, the Internalization Price shall be the lesser of the prices determined pursuant to the Internalization Formulas, subject to the Board of Directors’ discretion; and (B) if an Internalization Transaction occurs automatically at the end of the last Renewal Term pursuant to Section 17(b), the Internalization Price shall be equal to the Termination Fee computed pursuant to Section 13(b), with no Board of Directors’ discretion to change such Internalization Price and no conditions being applicable to the payment thereof.

		
			Section 18. Release of Money or Other Property Upon Written Request.  The Manager agrees that any money or other property of the Company or any Subsidiary held by the Manager under this Agreement shall be held by the Manager as custodian for the Company or such Subsidiary, and the Manager’s records shall be appropriately marked clearly to reflect the ownership of such money or other property by the Company or such Subsidiary. Upon the receipt by the Manager of a written request signed by a duly authorized officer of the Company or any Subsidiary requesting the Manager to release to the Company or such Subsidiary any money or other property then held by the Manager for the account of the Company or such Subsidiary under this Agreement, the Manager shall release such money or other property to the Company or such Subsidiary within a reasonable period of time, but in no event later than 30 days following such request. The Manager shall not be liable to the Company, any Subsidiary, the Independent Directors, or the Company’s or Subsidiary’s stockholders or partners for any acts performed or omissions to act by the Company or any Subsidiary in connection with the money or other property released to the Company or Subsidiary in accordance with the second sentence of this Section 18. The Company and any such Subsidiary shall indemnify the Manager and its officers, directors, personnel, managers, and officers against any and all expenses, losses, damages, liabilities, demands, charges and claims of any nature whatsoever, which arise in connection with the Manager’s release of such money or other property to the Company or Subsidiary in accordance with the terms of this Section 18. Indemnification pursuant to this provision shall be in addition to any right of the Manager to indemnification under Section 12 of this Agreement.
		

		
			Section 19.  Representations and Warranties.
		

			
	
			
				 (a)
			The Company hereby makes the following representations and warranties to the Manager, all of which shall survive the execution and delivery of this Agreement:

			
	
			
				 (i)
			Each of the Company and the Operating Company is a corporation or limited liability company duly organized, validly existing and in good standing under the laws of the State of Maryland or the State of Delaware, as applicable, and each is qualified to do business and in good standing in Maryland or Delaware, as applicable. Each of the Company and the Operating Company has all power and authority required to execute and deliver this Agreement and to perform all its duties and obligations hereunder.

			
	
			
				 (ii)
			The execution, delivery, and performance of this Agreement by each of the Company and the Operating Company have been duly authorized by all necessary action on the part of the Company and the Operating Company, respectively.

			
	
			
				 (iii)
			This Agreement constitutes a legal, valid, and binding agreement of each of the Company and the Operating Company, enforceable against each of the Company and the Operating Company in accordance with its terms, except as limited by Bankruptcy, insolvency, receivership and similar laws from time to time in effect and general principles of equity, including, without limitation, those relating to the availability of specific performance.

			
	
			
				 (b)
			The Manager hereby makes the following representations and warranties to the Company and the Operating Company, all of which shall survive the execution and delivery of this Agreement:

			
	
			
				 (i)
			The Manager is a limited liability company duly formed, validly existing, and in good standing under the laws of the State of Florida and is qualified to do business and in good standing in Florida. The Manager has all power and authority required to execute and deliver this Agreement and to perform all its duties and obligations hereunder, subject only to its qualifying to do business and obtaining all requisite permits and licenses required as a result of or relating to the nature or location of any of the assets or properties of the Company (which it shall do promptly after being required to do so).

			
	
			
				 (ii)
			The execution, delivery, and performance of this Agreement by the Manager have been duly authorized by all necessary action on the part of the Manager.

		 

		

			17

		

		

			 

		

 

			
	
			
				 (iii)
			This Agreement constitutes a legal, valid, and binding agreement of the Manager enforceable against the Manager in accordance with its terms, except as limited by Bankruptcy, insolvency, receivership and similar laws from time to time in effect and general principles of equity, including, without limitation, those relating to the availability of specific performance.

		
			Section 20.  Notice.
		

			
	
			
				 (a)
			All notices, demands or requests provided for or permitted to be given pursuant to this Agreement must be in writing, to the following addresses:

		
			If to the Company or the Operating Company:
		

		
			Jernigan Capital, Inc. 
6410 Poplar Avenue, Suite 650
Memphis, Tennessee 38119
Attention:  John A. Good
		

		
			If to the Manager:
		

		
			JCap Advisors, LLC
6410 Poplar Avenue, Suite 650
Memphis, Tennessee 38119
Attention:  Dean Jernigan
		

		
			All notices, demands and requests to be sent to a party hereto pursuant to this Agreement shall be deemed to have been properly given or served if: (i) personally delivered, (ii) deposited for next day delivery by Federal Express, or other similar overnight courier services, addressed to such party, (iii) deposited in the United States mail, addressed to such party, prepaid and registered or certified with return receipt requested or (iv) transmitted via facsimile or other similar device to the attention of such party with appropriate evidence of receipt by or transmission to the recipient party.

		

			
	
			
				 (b)
			All notices, demands and requests so given shall be deemed received: (i) when personally delivered, (ii) twenty-four hours after being deposited for next day delivery with an overnight courier, (iii) forty-eight hours after being deposited in the United States mail, or (iv) three hours after being transmitted via facsimile or otherwise transmitted and receipt has been confirmed.

		
			Section 21. Binding Nature of Agreement; Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective heirs, personal representatives, successors and permitted assigns as provided in this Agreement.
		

		
			Section 22. Entire Agreement.  This Agreement contains the entire agreement and understanding among the parties hereto with respect to the subject matter of this Agreement, and supersedes all prior and contemporaneous agreements, understandings, inducements and conditions, express or implied, oral or written, of any nature whatsoever with respect to the subject matter of this Agreement. The express terms of this Agreement control and supersede any course of performance and/or usage of the trade inconsistent with any of the terms of this Agreement.
		

		
			Section 23.  Amendments.  This Agreement may be amended or modified only by an agreement in writing signed by all parties hereto.
		

		

		

		 

		

			18

		

		

			 

		

 

		
		

		
			Section 24.  No Implied Waivers; Remedies.  No failure or delay on the part of any party in exercising any right, privilege, power, or remedy under this Agreement, and no course of dealing shall operate as a waiver of any such right, privilege, power or remedy; nor shall any single or partial exercise of any right, privilege, power or remedy under this Agreement preclude any other or further exercise of any such right, privilege, power or remedy or the exercise of any other right, privilege, power or remedy. No waiver shall be asserted against any party unless signed in writing by such party. The rights, privileges, powers and remedies available to the parties are cumulative and not exclusive of any other rights, privileges, powers or remedies provided by statute, at law, in equity or otherwise. Except as provided in this Agreement, no notice to or demand on any party in any case shall entitle such party to any other or further notice or demand in any similar or other circumstances or constitute a waiver of the right of the party giving such notice or making such demand to take any other or further action in any circumstances without notice or demand.
		

		
			Section 25.  Governing Law.  THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. EACH OF THE PARTIES HEREBY IRREVOCABLY AGREES THAT THE COURTS OF THE STATE OF NEW YORK SHALL HAVE EXCLUSIVE JURISDICTION IN CONNECTION WITH ANY ACTIONS OR PROCEEDINGS ARISING BETWEEN THE PARTIES UNDER THIS AGREEMENT. EACH OF THE PARTIES HEREBY IRREVOCABLY CONSENTS AND SUBMITS TO THE JURISDICTION OF SAID COURTS FOR ANY SUCH ACTION OR PROCEEDING. EACH OF THE PARTIES HEREBY WAIVES THE DEFENSE OF AN INCONVENIENT FORUM TO THE MAINTENANCE OF ANY SUCH ACTION OR PROCEEDING IN SAID COURTS.
		

		
			Section 26.  Headings.  The headings contained in this Agreement are for convenience only and shall not affect the construction or interpretation of any provisions of this Agreement.
		

		
			Section 27.  Severability.  If any provision of the Agreement shall be held to be invalid, the remainder of the Agreement shall not be affected thereby.
		

		
			Section 28.  Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original as against any party whose signature appears thereon, and all of which shall together constitute one and the same instrument. This Agreement shall become binding when one or more counterparts of this Agreement, individually or taken together, shall bear the signatures of all of the parties reflected hereon as the signatories.

		

		
			﻿
		

		
			﻿
		

		
			[Signature Page Follows] 
		

		
			﻿
		

		
			 
		

		

		

		 

		

			19

		

		

			 

		

 

		IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first above written. 
		

		
			 
		

			
					
						﻿

					
					
						 

					
					
						 

				
	
					
						JERNIGAN CAPITAL, INC.,

					
						a Maryland corporation

				
	
					
						﻿

				
	
					
						By:

					
					
						/s/ John A. Good

				
	
					
						﻿

					
					
						Name:  John A. Good

				
	
					
						﻿

					
					
						Title: President 

				
	
					
						﻿

				
	
					
						﻿

				
	
					
						JERNIGAN CAPITAL OPERATING COMPANY, Llc,

					
						a Delaware limited liability company

				
	
					
						﻿

				
	
					
						By:  Jernigan Capital, Inc., its managing member

				
	
					
						﻿

				
	
					
						﻿

				
	
					
						﻿

				
	
					
						﻿

					
					
						 

					
						By:

					
					
						/s/ John A. Good

				
	
					
						﻿

					
					
						 

					
					
						Name: John A. Good

				
	
					
						﻿

					
					
						 

					
					
						Title:  President

				
	
					
						﻿

				
	
					
						JCAP ADVISORS, LLC

					
						a Florida limited liability company

				
	
					
						﻿

				
	
					
						By:

					
					
						/s/ Dean Jernigan

				
	
					
						﻿

					
					
						Name: Dean Jernigan

				
	
					
						﻿

					
					
						Title:  Chief Executive Officer

				

		
			﻿
		

		
			 
		

		

		

		 

		

			20

		

		

			 

		

 

		Exhibit A
		

		
			﻿
		

		
			﻿
		

			
	
			
				 ·
			

			
	
			
			No investment will be made that would cause the Company to fail to qualify as a REIT for U.S. federal income tax purposes.

			
	
			
				 ·
			

			
	
			
			No investment will be made that would cause the Company to register as an investment company under the Investment Company Act.

			
	
			
				 ·
			

			
	
			
			No more than 20% of the Company’s equity, determined as of the date of investment, will be invested in any single project and no more than 20% of the Company’s equity, determined as of the date of such investment, will be invested in projects controlled by a single borrower or group of affiliated borrowers that would form a consolidated group under GAAP; provided however, that this provision shall not apply to the initial portfolio set forth in the final prospectus for the Initial Public Offering).

			
	
			
				 ·
			

			
	
			
			Over time the Company’s average leverage should be between 25% and 35% of the fair value of its assets, but the Company may borrow up to 100% of the principal value of certain First Mortgage Loans (as defined in the final prospectus for the Initial Public Offering). During periods where the Company’s portfolio consists largely of Whole Loans (as defined in the final prospectus for the Initial Public Offering), the Company may borrow up to 65% of the principal of such loans pending tranching of such loans and sale of First Mortgage Loans resulting from such tranching. 

			
	
			
				 ·
			

			
	
			
			The Company will maintain a portfolio of geographically diverse assets.

			
	
			
				 ·
			

			
	
			
			The Manager must seek approval of a majority of the Company’s Independent Directors before engaging in any transaction that falls outside of these guidelines.EX-4.1

 Exhibit 4.1 

EXECUTION VERSION 
  

 
  
  

CONSTELLATION BRANDS, INC., 
 as
Issuer 
 CONSTELLATION BRANDS SMO, LLC 

CONSTELLATION BRANDS U.S. OPERATIONS, INC. 

CONSTELLATION SERVICES LLC 
 CROWN
IMPORTS LLC 
 HOME BREW MART, INC., 

as Guarantors 
 and 

MANUFACTURERS AND TRADERS TRUST COMPANY, 

as Trustee 
  

 
 Supplemental
Indenture No. 15 
 Dated as of November 7, 2017 
  

 
 2.000% Senior
Notes due 2019 
  
  

 TABLE OF CONTENTS 
  

							
	 	  	 	  	Page	 
		
	ARTICLE ONE RELATION TO INDENTURE; DEFINITIONS	  	 	1	 
			
	     SECTION 1.1.
	  	 Relation to Indenture
	  	 	1	 
	     SECTION 1.2.
	  	 Definitions
	  	 	2	 
		
	ARTICLE TWO THE SERIES OF DEBT SECURITIES	  	 	10	 
			
	     SECTION 2.1.
	  	 Title of the Debt Securities
	  	 	10	 
	     SECTION 2.2.
	  	 Limitation on Aggregate Principal Amount
	  	 	10	 
	     SECTION 2.3.
	  	 Interest and Interest Rates; Maturity Date of Notes
	  	 	10	 
	     SECTION 2.4.
	  	 Optional Redemption
	  	 	11	 
	     SECTION 2.5.
	  	 Sinking Fund
	  	 	11	 
	     SECTION 2.6.
	  	 Method of Payment
	  	 	11	 
	     SECTION 2.7.
	  	 Currency
	  	 	11	 
	     SECTION 2.8.
	  	 Registered Securities; Global Form
	  	 	12	 
	     SECTION 2.9.
	  	 Form of Notes
	  	 	12	 
		
	 ARTICLE THREE COVENANTS
	  	 	12	 
			
	     SECTION 3.1.
	  	 Limitation on Liens
	  	 	12	 
	     SECTION 3.2.
	  	 Purchase of Notes upon a Change of Control Triggering Event
	  	 	14	 
	     SECTION 3.3.
	  	 Limitation on Sale and Leaseback Transactions
	  	 	17	 
	     SECTION 3.4.
	  	 Additional Guarantees
	  	 	18	 
	     SECTION 3.5.
	  	 Waiver of Certain Covenants
	  	 	18	 
		
	ARTICLE FOUR DEFEASANCE	  	 	18	 
			
	     SECTION 4.1.
	  	 Legal Defeasance
	  	 	19	 
	     SECTION 4.2.
	  	 Defeasance of Certain Obligations
	  	 	20	 
	     SECTION 4.3.
	  	 Application of Trust Money
	  	 	21	 
	     SECTION 4.4.
	  	 Repayment to Company
	  	 	21	 
	     SECTION 4.5.
	  	 Reinstatement
	  	 	21	 
		
	ARTICLE FIVE REMEDIES	  	 	22	 
			
	     SECTION 5.1.
	  	 Events of Default
	  	 	22	 
	     SECTION 5.2.
	  	 Acceleration of Maturity; Rescission and Annulment
	  	 	23	 
		
	ARTICLE SIX MISCELLANEOUS PROVISIONS	  	 	24	 
			
	     SECTION 6.1.
	  	 Ratification of Indenture
	  	 	24	 
	     SECTION 6.2.
	  	 Governing Law
	  	 	24	 
	 SECTION 6.3.
	  	Counterparts	  	 	25	 

  
 -i- 

							
	 	  	 	  	Page	 
		
	 ARTICLE SEVEN GUARANTEES
	  	 	25	 
		
	 ARTICLE EIGHT SUPPLEMENTAL INDENTURES
	  	 	25	 
			
	 SECTION 8.1.
	  	Supplemental Indentures and Agreements Without Consent of Holders	  	 	25	 
	 SECTION 8.2.
	  	Supplemental Indentures and Agreements with Consent of Holders	  	 	26	 

							
			
	 Exhibit A
	  	Form of Note	  			
	 Exhibit B
	  	Form of Guarantee	  			

  
 -ii- 

 SUPPLEMENTAL INDENTURE NO. 15, dated as of November 7, 2017 (this
“Supplemental Indenture”), between CONSTELLATION BRANDS, INC., a corporation duly organized and existing under the laws of the State of Delaware (herein called the “Company”), the guarantors named herein and from
time to time parties hereto, and MANUFACTURERS AND TRADERS TRUST COMPANY, a New York banking corporation, as Trustee (herein called the “Trustee”). 

RECITALS OF THE COMPANY 

WHEREAS, the Company has heretofore delivered to the Trustee an Indenture dated as of April 17, 2012 (the “Initial
Indenture” and, together with Supplemental Indenture No. 1, dated as of April 17, 2012, Supplemental Indenture No. 2, dated as of August 14, 2012, Supplemental Indenture No. 3, dated as of May 14, 2013,
Supplemental Indenture No. 4, dated as of May 14, 2013, Supplemental Indenture No. 5, dated as of June 7, 2013, Supplemental Indenture No. 6, dated as of May 28, 2014, Supplemental Indenture No. 7, dated as of
November 3, 2014, Supplemental Indenture No. 8, dated as of November 3, 2014, Supplemental Indenture No. 9, dated as of December 4, 2015, Supplemental Indenture No. 10, dated as of January 15, 2016, Supplemental
Indenture No. 11, dated as of December 6, 2016, Supplemental Indenture No. 12, dated as of May 9, 2017, Supplemental Indenture No. 13, dated as of May 9, 2017, Supplemental Indenture No. 14, dated as of May 9,
2017, Supplemental Indenture No. 16, dated as of November 7, 2017, Supplemental Indenture No. 17, dated as of November 7, 2017 and this Supplemental Indenture, the “Indenture”), providing for the issuance from time to
time of Debt Securities of the Company. 
 WHEREAS, Sections 2.1 and 2.2 of the Initial Indenture provide for various matters with respect
to any series of Debt Securities issued under the Initial Indenture to be established in an indenture supplemental to the Initial Indenture. 

WHEREAS, Section 12.1(e) of the Initial Indenture provides for the Company and the Trustee to enter into an indenture supplemental to
the Initial Indenture to establish the form or terms of Debt Securities of any series as provided by Sections 2.1 and 2.2 of the Initial Indenture. 

WHEREAS, all the conditions and requirements necessary to make this Supplemental Indenture, when duly executed and delivered, a valid and
binding agreement in accordance with its terms and for the purposes herein expressed, have been performed and fulfilled. 
 NOW, THEREFORE,
THIS SUPPLEMENTAL INDENTURE WITNESSETH: 
 For and in consideration of the premises and the purchase of the series of Debt Securities
provided for herein by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of the Notes, as follows: 

ARTICLE ONE 
 RELATION TO
INDENTURE; DEFINITIONS 
 SECTION 1.1.      Relation to Indenture. 

 This Supplemental Indenture constitutes an integral part of the Indenture. 

SECTION 1.2.      Definitions. 

For all purposes of this Supplemental Indenture, except as otherwise expressly provided for or unless the context otherwise requires: 

(1)      Capitalized terms used but not defined herein shall have the respective meanings
assigned to them in the Initial Indenture; 
 (2)      All references herein to Articles and
Sections, unless otherwise specified, refer to the corresponding Articles and Sections of this Supplemental Indenture; and 

(3)      To the extent terms defined herein differ from the Initial Indenture the terms defined
herein will govern. 
 “Bankruptcy Law” means Title 11, United States Bankruptcy Code of 1978, as amended, or any similar
United States federal or state law relating to bankruptcy, insolvency, receivership, winding-up, liquidation, reorganization or relief of debtors or any amendment to, succession to or change in any such law.

 “Capital Lease Obligation” means any obligations of the Company and its Subsidiaries on a Consolidated basis
under any capital lease of real or personal property which, in accordance with GAAP, has been recorded as a capitalized lease obligation. 

“Capital Markets Debt” means any debt securities or debt financing issued pursuant to an indenture, notes purchase
agreement or similar financing arrangement (but excluding any credit agreement) whether offered pursuant to a registration statement under the Securities Act or under an exemption from the registration requirements of the Securities Act. 

“Capital Stock” means, with respect to any Person, any and all shares, interests, participations or other equivalents
(however designated, whether voting or non-voting) in the equity of such Person, including, without limitation, all common stock and preferred stock. 

“Change of Control” means the occurrence of any of the following events: (i) any “person” or
“group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than Permitted Holders, is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that a Person shall be deemed to have beneficial ownership of all shares that such Person has the right to acquire, whether such right is exercisable immediately or only after
the passage of time), directly or indirectly, of more than 35% of the voting power of the total outstanding Voting Stock of the Company voting as one class, provided that the Permitted Holders “beneficially own” (as so defined) a
percentage of Voting Stock having a lesser percentage of the voting power than such other Person and do not have the right or ability by voting power, contract or otherwise to elect or designate for election a majority of the Board of Directors of
the Company; (ii) during any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of the Company (together with any new directors whose election to such Board or whose nomination
for election by the shareholders of the Company was approved by a vote of 66 2/3% of the directors then still in of 

  
 -2- 

 
fice who were either 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 such Board
of Directors then in office; (iii) the Company consolidates with or merges with or into any Person or conveys, transfers or leases all or substantially all of its assets to any Person, or any corporation consolidates with or merges into or with
the Company, in any such event pursuant to a transaction in which the outstanding Voting Stock of the Company is changed into or exchanged for cash, securities or other property, other than any such transaction where the Company’s outstanding
Voting Stock is not changed or exchanged at all (except to the extent necessary to reflect a change in the jurisdiction of incorporation of the Company) or where (A) the outstanding Voting Stock of the Company is changed into or exchanged for
(x) Voting Stock of the surviving corporation or (y) cash, securities and other property (other than Capital Stock of the surviving corporation) and (B) no “person” or “group” other than Permitted Holders owns
immediately after such transaction, directly or indirectly, more than the greater of (1) 35% of the voting power of the total outstanding Voting Stock of the surviving corporation voting as one class and (2) the percentage of such voting power
of the surviving corporation held, directly or indirectly, by Permitted Holders immediately after such transaction; or (iv) the Company is liquidated or dissolved or adopts a plan of liquidation or dissolution other than in a transaction which
complies with the provisions of Article Ten of the Initial Indenture. 
 “Change of Control Offer” shall have the meaning
set forth in Section 3.2(a). 
 “Change of Control Purchase Date” shall have the meaning set forth in
Section 3.2(a). 
 “Change of Control Purchase Notice” shall have the meaning set forth in Section 3.2(b). 

“Change of Control Purchase Price” shall have the meaning set forth in Section 3.2(a). 

“Change of Control Triggering Event” means (1) the ratings of the Notes are downgraded by at least two of the Ratings
Agencies during the 60-day period (the “Trigger Period”) commencing on the earlier of (i) the occurrence of a Change of Control or (ii) the first public announcement of the occurrence of a
Change of Control or the Company’s intention to effect a Change of Control (which Trigger Period will be extended so long as the ratings of the Notes are under publicly announced consideration for possible downgrade by any of the Ratings
Agencies) and (2) the Notes are rated below an Investment Grade Rating by at least two of the Ratings Agencies on any date during the Trigger Period; provided that if the Notes are not rated by three Ratings Agencies during any Trigger Period,
the Notes will be deemed to have been downgraded to below an Investment Grade Rating by each Ratings Agency that does not provide a rating of the Notes during the Trigger Period. Notwithstanding the foregoing, a ratings decline by a Rating Agency
will not be deemed to have occurred in respect of a particular Change of Control if such Rating Agency making the reduction in rating to which this definition would otherwise apply does not publicly announce or confirm or inform the Trustee in
writing at the Company’s or the Trustee’s request that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, such Change of Control (whether or not the
applicable Change of Control has occurred at the time of such decline). 

  
 -3- 

 “Commission” means the Securities and Exchange Commission, as from time to time
constituted, created under the Exchange Act, or if at any time after the execution of this Supplemental Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing
such duties at such time. 
 “Company” means Constellation Brands, Inc., a corporation incorporated under the laws of
Delaware, until a successor Person shall have become such pursuant to Article Ten of the Initial Indenture, and thereafter “Company” shall mean such successor Person. 

“Comparable Treasury Issue” means the United
States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term until November 7, 2019. 

“Comparable Treasury Price” means (1) the average of four Reference Treasury Dealer Quotations for such
redemption date, after excluding the highest and lowest Reference Treasury Dealer Quotations, or (2) if the Independent Investment Banker obtains fewer than four such Reference Treasury Dealer Quotations, the average of all such quotations.

 “Consolidated Fixed Charge Coverage Ratio” of the Company means, for any period, the ratio of (a) the sum
of Consolidated Net Income (Loss), Consolidated Interest Expense, Consolidated Income Tax Expense and Consolidated Non-cash Charges deducted in computing Consolidated Net Income (Loss) in each case, for such
period, of the Company and its Subsidiaries on a Consolidated basis, all determined in accordance with GAAP and on a pro forma basis for any acquisition or disposition of a Subsidiary or line of business following the first day of such period and on
or prior to the date of determination as if all such acquisitions and dispositions had occurred on the first day of such period to (b) the sum of Consolidated Interest Expense for such period and cash dividends paid on any of the Company’s
preferred stock and that of its Subsidiaries during such period; provided that (i) in making such computation, the Consolidated Interest Expense attributable to interest on any Funded Debt shall be computed on a pro forma basis for any
incurrence or repayment of Funded Debt (other than Funded Debt under a revolving credit facility) following the first day of the applicable period and on or prior to the date of determination as if such incurrence or repayment had occurred on the
first day of such period and Funded Debt, (A) bearing a floating interest rate, shall be computed as if the rate in effect on the date of computation had been the applicable rate for the entire period and (B) which was not outstanding
during the period for which the computation is being made but which bears, at the option of the Company, a fixed or floating rate of interest, shall be computed by applying at the Company’s option, either the fixed or floating rate and
(ii) in making such computation, the Consolidated Interest Expense of the Company attributable to interest on any Funded Debt under a revolving credit facility computed on a pro forma basis shall be computed based upon the average daily balance
of such Funded Debt during the applicable period. 
 “Consolidated Income Tax Expense” means for any period, as
applied to the Company, the provision for federal, state, local and foreign income taxes of the Company and its Subsidiaries for such period as determined in accordance with GAAP on a Consolidated basis. 

“Consolidated Interest Expense” of the Company means, without duplication, for any period, the sum of (a) the
interest expense of the Company and its Subsidiaries for such peri 

  
 -4- 

 
od, on a Consolidated basis, including, without limitation, (i) amortization of debt discount, (ii) the net cost under interest rate contracts (including amortization of discounts),
(iii) the interest portion of any deferred payment obligation and (iv) accrued interest, plus (b) (i) the interest component of the Capital Lease Obligations paid, accrued and/or scheduled to be paid or accrued by the Company and its
Subsidiaries during such period and (ii) all capitalized interest of the Company and its Subsidiaries, in each case as determined in accordance with GAAP on a Consolidated basis. Whenever pro forma effect is to be given to an acquisition or
disposition of assets for the purpose of calculating the Consolidated Fixed Charge Coverage Ratio, the amount of Consolidated Interest Expense associated with any Funded Debt incurred in connection with such acquisition or disposition of assets
shall be calculated on a pro forma basis in accordance with Regulation S-X under the Securities Act, as in effect on the date of such calculation. 

“Consolidated Net Income (Loss)” of the Company means, for any period, the Consolidated net income (or loss) of the
Company and its Subsidiaries for such period as determined in accordance with GAAP on a Consolidated basis, adjusted, to the extent included in calculating such net income (loss), by excluding, without duplication: (i) all extraordinary gains
or losses (less all fees and expenses relating thereto); (ii) the portion of net income (or loss) of the Company and its Subsidiaries allocable to minority interests in unconsolidated Persons to the extent that cash dividends or distributions have
not actually been received by the Company or one of its Subsidiaries; (iii) any gain or loss, net of taxes, realized upon the termination of any employee pension benefit plan; (iv) net gains (but not losses) (less all fees and expenses
relating thereto) in respect of dispositions of assets other than in the ordinary course of business; or (v) the net income of any Subsidiary to the extent that the declaration of dividends or similar distributions by that Subsidiary of that
income is not at the time permitted, directly or indirectly, by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulations applicable to that Subsidiary or its stockholders.
Whenever pro forma effect is to be given to an acquisition or disposition of assets for the purpose of calculating the Consolidated Fixed Charge Coverage Ratio, the amount of income or earnings related to such assets shall be calculated on a pro
forma basis in accordance with Regulation S-X under the Securities Act, as in effect on the date of such calculation. 

“Consolidated Net Tangible Assets” means the aggregate amount of assets (less applicable reserves and other properly
deductible items) after deducting therefrom (i) all current liabilities, excluding the current portion of any Funded Debt and any other current liabilities constituting Funded Debt because such Funded Debt is extendible or renewable, and
(ii) all goodwill, trade names, trademarks, patents, unamortized debt discount and expense and other similar intangibles, all as set forth on the books and records of the Company and its Consolidated Subsidiaries and computed in accordance with
GAAP. 
 “Consolidated Non-cash Charges” of the Company means, for any
period, the aggregate depreciation, amortization and other non-cash charges of the Company and its Subsidiaries for such period, as determined in accordance with GAAP on a Consolidated basis (excluding any non-cash charge which requires an accrual or reserve for cash charges for any future period). 

“Consolidation” means, with respect to any Person, the consolidation of the accounts of such Person and each of its
Subsidiaries if and to the extent the accounts of such Per 

  
 -5- 

 
son and each of its Subsidiaries would normally be consolidated with those of such Person, all in accordance with GAAP. The term “Consolidated” shall have a similar meaning. 

“Default” means any event which is, or after notice or passage of time or both would be, an Event of Default. 

“Depositary” or “DTC” has the meaning set forth in Section 2.6. 

“Exchange Act” means the Securities Exchange Act of 1934, as amended. 

“Event of Default” has the meaning set forth in Section 5.1. 

“Fitch” means Fitch Ratings, Inc., and its successors. 

“Funded Debt” means all indebtedness for the repayment of money borrowed, whether or not evidenced by a bond, debenture,
note or similar instrument or agreement, having a final maturity of more than 12 months after the date of its creation or having a final maturity of less than 12 months after the date of its creation but by its terms being renewable or
extendible beyond 12 months after such date at the option of the borrower. When determining “Funded Debt,” indebtedness will not be included if, on or prior to the final maturity of that indebtedness, the Company has deposited the
necessary funds for the payment, redemption or satisfaction of that indebtedness in trust with the proper depositary. 

“GAAP” means generally accepted accounting principles in the United States of America, consistently applied, which
are in effect on the Issue Date. At any time after the Issue Date, the Company may elect to apply International Financial Reporting Standards (“IFRS”) accounting principles consistently applied, as in effect at the time of such
election, in lieu of GAAP and, from and after any such election, references herein to GAAP shall thereafter be construed to mean IFRS; provided that any such election, once made, shall be irrevocable; provided, further that any calculation or
determination under the Indenture that requires the application of GAAP for periods that include fiscal quarters ended prior to the Company’s election to apply IFRS shall remain as previously calculated or determined in accordance with GAAP.
Promptly after the making of any such election, the Company shall deliver an Officer’s Certificate to the Trustee and a notice to the Holders, in each case providing notice of any election made in accordance with this definition. 

“Guarantee” means the guarantee by each Guarantor of the Company’s Indenture Obligations pursuant to a guarantee given
in accordance with this Supplemental Indenture, including the Guarantees by the Guarantors on the Issue Date and any Guarantee delivered pursuant to Section 3.4. 

“Guarantor” means the Subsidiaries listed on the signature pages of this Supplemental Indenture as guarantors and each other
Subsidiary required to become a Guarantor after the Issue Date pursuant to Section 3.4, in each case, until such Guarantor’s Guarantee is released in accordance with the Initial Indenture. 

“Holders” mean the registered holders of the Notes. 

  
 -6- 

 “Indenture Obligations” means the obligations of the Company and any other
obligor under this Supplemental Indenture or under the Notes, including any Guarantor, to pay principal of, premium, if any, and interest when due and payable, and all other amounts due or to become due under or in connection with this Supplemental
Indenture, the Notes and the performance of all other obligations to the Trustee and the Holders under this Supplemental Indenture and the Notes, according to the terms hereof or thereof. 

“Independent Investment Banker” means a Reference Treasury Dealer selected by the Company. 

“Insolvency or Liquidation Proceeding” means, with respect to any Person, any liquidation, dissolution or winding-up of such Person, or any bankruptcy, reorganization, insolvency, receivership or similar proceeding with respect to such Person, whether voluntary or involuntary. 

“Interest Payment Date” has the meaning set forth in Section 2.3. 

“Investments” means, with respect to any Person, directly or indirectly, any advance, loan (including guarantees), or other
extension of credit or capital contribution to (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of others), or any purchase, acquisition or ownership by such Person of any
Capital Stock, bonds, notes, debentures or other securities issued or owned by, any other Person and all other items that would be classified as investments on a balance sheet prepared in accordance with GAAP. 

“Investment Grade Rating” means a rating of Baa3 or better by Moody’s (or its equivalent under any successor rating
categories of Moody’s), a rating of BBB- or better by S&P (or its equivalent under any successor rating categories of S&P), a rating of BBB- or better by
Fitch (or its equivalent under any successor rating categories of Fitch) or the equivalent Investment Grade credit rating from any additional Rating Agency or Rating Agencies selected by the Company, as applicable. 

“Issue Date” means the original issue date of the initial Notes issued under this Supplemental Indenture. 

“Lien” means any mortgage, charge, pledge, lien (statutory or otherwise), security interest, hypothecation or other
encumbrance upon or with respect to any property of any kind, real or personal, movable or immovable, now owned or hereafter acquired. 

“Maturity” when used with respect to any Note means the date on which the principal of such Note becomes due and payable as
therein provided or as provided in this Supplemental Indenture, whether at Stated Maturity or the redemption date and whether by declaration of acceleration, Change of Control, call for redemption or otherwise. 

“Moody’s” means Moody’s Investors Service, Inc., and its successors. 

“Notes” has the meaning specified in Section 2.1. 

  
 -7- 

 “Obligations” means any principal, interest (including, without limitation,
Post-Petition Interest), penalties, fees, indemnifications, reimbursement obligations, damages and other liabilities payable under the documentation governing any Funded Debt. 

“Permitted Holders” means (a) Marilyn Sands, her descendants (whether by blood or adoption), her descendants’
spouses, her siblings, the descendants of her siblings (whether by blood or adoption), Hudson Ansley, Lindsay Caleo, William Caleo, Courtney Winslow, or Andrew Stern, or the estate of any of the foregoing Persons, or The Sands Family Foundation,
Inc., (b) trusts which are for the benefit of any combination of the Persons described in clause (a), or any trust for the benefit of any such trust, or (c) partnerships, limited liability companies or any other entities which are controlled by
any combination of the Persons described in clause (a), the estate of any such Persons, a trust referred to in the foregoing clause (b) or an entity that satisfies the conditions of this clause (c). 

“Person” means any individual, corporation, limited liability company, partnership, joint venture, association, joint-stock
company, trust, unincorporated organization, any other company or entity or government or any agency or political subdivision thereof. 

“Post-Petition Interest” means, with respect to any indebtedness of any
Person, all interest accrued or accruing on such indebtedness after the commencement of any Insolvency or Liquidation Proceeding against such Person in accordance with and at the contract rate (including, without limitation, any rate applicable upon
default) specified in the agreement or instrument creating, evidencing or governing such indebtedness, whether or not, pursuant to applicable law or otherwise, the claim for such interest is allowed as a claim in such Insolvency or Liquidation
Proceeding. 
 “Principal Property” means, as of any date, any building, structure or other facility, together with
the land upon which it is erected and any fixtures which are a part of the building, structure or other facility, used primarily for manufacturing, processing or production, in each case located in the United States of America, and owned or leased
or to be owned or leased by the Company or any of its Subsidiaries, and in each case the net book value of which as of that date exceeds 2% of the Company’s Consolidated Net Tangible Assets as shown on the consolidated balance sheet contained
in the Company’s latest filing with the Commission, other than any such land, building, structure or other facility or portion thereof which is a pollution control facility, or which, in the opinion of the Board of Directors, is not of material
importance to the total business conducted by the Company and its Subsidiaries, considered as one enterprise. 

“Property” means any asset, revenue or any other property, whether tangible or intangible, real or personal,
including, without limitation, any right to receive income. 
 “Rating Agency” means S&P, Moody’s and Fitch or,
if S&P, Moody’s or Fitch or any or all of them shall not make a rating on the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Company (as certified by a resolution
of the Board of Directors) which shall be substituted for S&P, Moody’s or Fitch or any or all of them, as the case may be. 

  
 -8- 

 “Reference Treasury Dealer” means any of (1) Merrill Lynch, Pierce,
Fenner & Smith Incorporated, J.P. Morgan Securities LLC or their affiliates; provided, however, that if Merrill Lynch, Pierce, Fenner & Smith Incorporated, J.P. Morgan Securities LLC or one of their
affiliates cease to be a primary United States Government securities dealer in New York City (a “Primary Treasury Dealer”), another Primary Treasury Dealer will be substituted by the Company and (2) any other Primary Treasury Dealer
selected by the Independent Investment Banker after consultation with the Company. 
 “Reference Treasury Dealer
Quotations” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in
each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker at 5:00 p.m., New York City time, on the third Business Day preceding such redemption date. 

“S&P” means Standard & Poor’s Ratings Services, a division of the McGraw-Hill Companies, Inc., and its
successors. 
 “Sale and Leaseback Transaction” means any transaction or series of related transactions pursuant to which
the Company or a Subsidiary sells or transfers any property or asset in connection with the leasing, or the resale against installment payments, of such property or asset to the seller or transferor. 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder. 

“Senior Credit Facility” means that certain Sixth Amended and Restated Credit Agreement, dated as of July 14, 2017, by
and among the Company, CIH International S.à r.l., CB International Finance S.à r.l., Bank of America, N.A., as administrative agent, and the other agents and lenders party thereto from time to time, as amended, restated, modified,
supplemented, substituted, replaced, renewed or refinanced from time to time, including any agreement or agreements extending the maturity of, or refinancing all or any portion of the indebtedness under such agreement, and any successor or
replacement agreement or agreements with the same or any other borrowers, agents, creditors, lenders or group of creditors or lenders. 

“Stated Maturity” when used with respect to any indebtedness or any installment of interest thereon, means the dates
specified in such indebtedness as the fixed date on which the principal of such indebtedness or such installment of interest is due and payable. 

“Subsidiary” means any Person a majority of the equity ownership or the Voting Stock of which is at the time owned, directly
or indirectly, by the Company or by one or more other Subsidiaries, or by the Company and one or more other Subsidiaries. 

“Treasury Rate” means, with respect to any redemption date, (1) the average of the yields in each statistical release
for the immediately preceding week designated “H.15” or any successor publication which is published by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities
adjusted to constant maturity under “U.S. government securities—Treasury constant maturities— 

  
 -9- 

 
nominal,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the remaining term of the Notes to be redeemed, yields for
the two published maturities most closely corresponding to the Comparable Treasury Issue will be determined and the Treasury Rate will be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month) or
(2) if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per year equal to the semi-annual equivalent yield-to-maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for
such redemption date. The Treasury Rate will be calculated on the third Business Day preceding the redemption date. 
 “Trust
Indenture Act” means the Trust Indenture Act of 1939, as amended. 
 “United States Government Obligations” means
direct non-callable obligations of the United States of America for the payment of which the full faith and credit of the United States of America is pledged. 

“Voting Stock” means, with respect to any Person, Capital Stock of any class or kind the holders of which are ordinarily, in
the absence of contingencies, entitled to vote for the election of directors (or persons performing similar functions) of such Person, even if the right so to vote has been suspended by the happening of such a contingency. 

ARTICLE TWO 
 THE SERIES OF DEBT
SECURITIES 
 SECTION 2.1.      Title of the Debt Securities. 

There shall be a series of Debt Securities designated the “2.000% Senior Notes due 2019” (the “Notes”). 

SECTION 2.2.      Limitation on Aggregate Principal Amount. 

The aggregate principal amount of the Notes shall not be limited. The Company shall not execute and the Trustee shall not authenticate or
deliver Notes except as permitted by the terms of the Indenture. 
 SECTION 2.3.      Interest and
Interest Rates; Maturity Date of Notes. 
 The Notes will mature on November 7, 2019 and will be unsecured senior obligations of
the Company. Each Note will bear interest at the rate of 2.000% per annum from November 7, 2017 or from the most recent interest payment date to which interest has been paid, payable semi-annually on May 7 and November 7 of each year (each
an “Interest Payment Date”), commencing May 7, 2018, to the Person in whose name the Note (or any predecessor Note) is registered at the close of business on April 22 or October 23, as applicable, next preceding such
Interest Payment Date. Interest will be computed on the basis of a 360-day year comprised of twelve 30-day months. The interest so payable on any Note which is not
punctually paid or duly provided for on any Interest Payment Date shall forthwith cease to be payable to the Person in whose name such Note is registered on the relevant regular record date, and such de

  
 -10- 

 
faulted interest shall instead be payable to the Person in whose name such Note is registered on the special record date or other specified date determined in accordance with the Indenture. 

If any Interest Payment Date or Stated Maturity falls on a day that is not a Business Day, the required payment shall be made on the next
Business Day as if it were made on the date such payment was due and no interest shall accrue on the amount so payable for the period from and after such Interest Payment Date or Stated Maturity, as the case may be. 

SECTION 2.4.      Optional Redemption. 

At any time prior to the Stated Maturity thereof, the Notes may be redeemed in whole or in part at any time or in part from time to time, at
the Company’s option, at a redemption price equal to the greater of: 
 (i)      100% of
the principal amount of the Notes to be redeemed; and 
 (ii)      the sum of the present
values of the remaining scheduled payments of principal and interest (excluding interest accrued to the redemption date) on the Notes discounted to the date of redemption on a semi-annual basis (assuming a
360-day year consisting of twelve 30-day months) at the applicable Treasury Rate plus 10 basis points; 

plus, in each case, accrued and unpaid interest on the principal amount being redeemed to but excluding the redemption date.

 The provisions of Section 5.2, 5.3 and 5.6 of the Initial Indenture shall be applicable to any optional redemption of the Notes.

 SECTION 2.5.      Sinking Fund. 

The Notes are not entitled to the benefit of any sinking fund. 

SECTION 2.6.      Method of Payment. 

Settlement for the Notes will be made in same day funds. All payments of principal and interest will be made by the Company in same day
funds. The Notes will trade in the Same-Day Funds Settlement System of The Depository Trust Company (the “Depositary” or “DTC”) until Maturity, and secondary market trading
activity for the Notes will therefore settle in same day funds. 
 Principal of, premium, if any, and interest on the Notes will be
payable, and the Notes will be exchangeable and transferable, at the office or agency of the Company in the City of New York maintained for such purposes (which initially will be the Trustee); provided, however, that payment of
interest may be made at the option of the Company by check mailed to the Person entitled thereto as shown on the security register. 

SECTION 2.7.      Currency. 

  
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 Principal and interest on the Notes shall be payable in United States Dollars or 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. 
 SECTION
2.8.      Registered Securities; Global Form. 
 The Notes shall be issuable only in fully registered
form without coupons, in denominations of $2,000 and any integral multiple of $1,000 in excess thereof. No service charge will be made for any registration of transfer, exchange or redemption of Notes, except in certain circumstances for any tax or
other governmental charge that may be imposed in connection therewith. The depository for the Notes shall be the DTC. The Notes shall not be issuable in definitive form. 

SECTION 2.9.      Form of Notes. 

The Notes shall be substantially in the form attached as Exhibit A hereto. 

ARTICLE THREE 
 COVENANTS

 The following covenants shall apply to the Notes (but not with respect to any other series of Debt Securities), and are in addition to
the covenants set forth in Article Four of the Initial Indenture. With respect to the Notes (but not with respect to any other series of Debt Securities), to the extent inconsistent with the covenants contained in Article Four of the Initial
Indenture the covenants set forth in this Supplemental Indenture shall govern. 
 SECTION
3.1.      Limitation on Liens. 
 So long as any of the Notes remain Outstanding, the Company will
not, and will not permit any Subsidiary to, issue, assume or guarantee any Funded Debt that is secured by a mortgage, pledge, security interest or other Lien or encumbrance upon or with respect to any Principal Property or on the Capital Stock of
any Subsidiary that owns a Principal Property unless: 
 (a)      the Company secures the
Notes equally and ratably with (or prior to) any and all Funded Debt secured by that Lien, or 

(b)      in the case of Funded Debt other than Capital Markets Debt, immediately after giving
effect to the granting of any such Lien and the incurrence of any Funded Debt in connection therewith, the Company’s Consolidated Fixed Charge Coverage Ratio would be greater than 2.0 to 1.0; 

provided, however, that nothing contained in the foregoing shall prevent, restrict or apply to the following: 

(i)      Liens existing as of the Issue Date (excluding Liens securing the Senior Credit
Facility) on any Property or assets owned or leased by the Company or any Subsidiary; 

  
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 (ii)      [reserved]; 

(iii)      Liens on Property or assets of, or any shares of stock securing Funded Debt of, any
corporation or other Person existing at the time such corporation or other Person becomes a Subsidiary; 

(iv)      Liens on Property, assets or shares of stock securing Funded Debt existing at the time
of an acquisition, including an acquisition through merger or consolidation, and Liens to secure Funded Debt incurred prior to, at the time of or within 180 days after the later of the completion of the acquisition, or the completion of the
construction and commencement of the operation of any such Property, for the purpose of financing all or any part of the purchase price or construction cost of that Property; 

(v)      Liens on any Property or assets to secure all or any portion of the cost of
development, operation, construction, alteration, repair or improvement of all or any part of such Property or assets, or to secure Funded Debt incurred prior to, at the time of or within 180 days after the completion of such development, operation,
construction, alteration, repair or improvement for the purpose of financing all or any part of such costs; 

(vi)      Liens in favor of, or which secure Funded Debt owing to, the Company or a Subsidiary;

 (vii)      Liens arising from the assignment of moneys due and to become due under
contracts between the Company or any Subsidiary and the United States of America, any State, Commonwealth, Territory or possession thereof or any agency, department, instrumentality or political subdivision of any thereof; or Liens in favor of the
United States of America, any State, Commonwealth, Territory or possession thereof or any agency, department, instrumentality or political subdivision of any thereof, to secure progress, advance or other payments pursuant to any contract or
provision of any statute, or pursuant to the provisions of any contract not directly or indirectly in connection with securing any Funded Debt; 

(viii)      Liens arising by reason of any attachment, judgment, decree or order of any court or
other governmental authority, so long as such Lien is adequately bonded and any appropriate legal proceedings which may have been initiated for review of such attachment, judgment, decree or order shall not have been finally terminated or so long as
the period within which such proceedings may be initiated shall not have expired; 

(ix)      any deposit or pledge as security for the performance of any bid, tender, contract,
lease or undertaking not directly or indirectly in connection with the securing of any Funded Debt; any deposit or pledge with any governmental agency required or permitted to qualify the Company or any Subsidiary to conduct business, to maintain
self-insurance or to obtain the benefits of any law pertaining to worker’s compensation, unemployment insurance, pensions, social security or similar matters, or to obtain any stay or discharge in any legal or administrative proceedings;
deposits or pledges to obtain the release of mechanics’ worker’s, repairmen’s, materialmen’s or warehousemen’s liens on the release of property in the possession of a common carrier; any security interest created in

  
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connection with the sale, discount or guarantee of notes, chattel mortgages, leases, accounts receivable, trade acceptances or other paper, or contingent repurchase obligations, arising out of
sales of merchandise in the ordinary course of business; liens for taxes not yet due and payable or being contested in good faith; any deposit or pledge in connection with appeal or surety bonds; or other deposits or pledges similar to those
referred to in this clause (ix); 
 (x)      Liens created after the Issue Date on Property
leased to or purchased by the Company or any Subsidiary after that date and securing, directly or indirectly, obligations issued by a State, a Territory or a possession of the United States of America, or any political subdivision of any of the
foregoing, or the District of Columbia, to finance the cost of acquisition or cost of construction of such Property; 

(xi)      Liens arising from surveys exceptions, title defects, encumbrances, easements,
reservations of, or rights of others for, rights of way, sewers, electric lines, telegraph or telephone lines and other similar purposes or zoning or other restrictions as to the use of real property not interfering with the ordinary conduct of the
business of the Company or any of its Subsidiaries; 
 (xii)      Liens arising by operation
of law in favor of mechanics, materialmen, laborers, employees or suppliers, incurred in the ordinary course of business for sums which are not yet delinquent or are being contested in good faith by negotiations or by appropriate proceedings which
suspend the collection thereof; 
 (xiii)      Liens arising from zoning restrictions,
easements, licenses, reservations, provisions, covenants, conditions, waivers, restrictions on the use of property or minor irregularities of title (and with respect to leasehold interests, mortgages, obligations, Liens and other encumbrances
incurred, created, assumed or permitted to exist and arising by, through or under a landlord or owner of the leased Property, with or without consent of the lessee), none of which materially impairs the use of any parcel of Property material to the
operation of the business of the Company or any Subsidiary or the value of such Property for the purpose of such business; or 

(xiv)      any extension, renewal, substitution or replacement (or successive extensions,
renewals, substitutions or replacements), as a whole or in part, of any Lien referred to in subparagraphs (i) through (xiii) above or the Funded Debt secured thereby; provided, that (1) such extension, renewal, substitution or
replacement Lien shall be limited to all or any part of the same Property or assets or shares of stock that secured the Lien extended, renewed, substituted or replaced (plus improvements on such Property and any other Property or assets not then
constituting a Principal Property) and (2) the Funded Debt secured by such Lien at such time is not increased. 
 SECTION
3.2.      Purchase of Notes upon a Change of Control Triggering Event. 

(a)      If a Change of Control Triggering Event shall occur at any time, then each Holder of Notes shall have
the right to require that the Company purchase such Holder’s Notes in whole or in part (equal to $2,000 or an integral multiple of $1,000 in excess thereof), at a pur 

  
 -14- 

 
chase price (the “Change of Control Purchase Price”) in cash in an amount equal to 101% of the principal amount of such Notes, plus accrued and unpaid interest, if any, to, but
excluding, the date of purchase (the “Change of Control Purchase Date”), pursuant to the offer described in subsection (b) of this Section (the “Change of Control Offer”) and in accordance with the procedures
set forth in subsections (b), (c), (d) and (e) of this Section 3.2. 
 (b)      Within 30 days
following any Change of Control Triggering Event, the Company shall (i) cause a notice of the Change of Control Offer to be sent at least once to the Dow Jones News Service or similar business news service in the United States of America; and
(ii) notify the Trustee thereof and give written notice (a “Change of Control Purchase Notice”) of such Change of Control to each Holder by first-class mail, postage prepaid, at its address appearing in the Security Register
stating or including: 
 (1)      that a Change of Control Triggering Event has occurred, the
date of such event, and that such Holder has the right to require the Company to repurchase such Holder’s Notes at the Change of Control Purchase Price; 

(2)      the circumstances and relevant facts regarding such Change of Control Triggering Event
(including information with respect to the Company’s pro forma consolidated historical income, cash flow and capitalization after giving effect to such Change of Control Triggering Event); 

(3)      that the Change of Control Offer is being made pursuant to this Section 3.2 and
that all Notes properly tendered pursuant to the Change of Control Offer will be accepted for payment at the Change of Control Purchase Price; 

(4)      the Change of Control Purchase Date, which shall be a Business Day no earlier than 30
days nor later than 60 days from the date such notice is mailed, or such later date as is necessary to comply with requirements under the Exchange Act; 

(5)      the Change of Control Purchase Price; 

(6)      the names and addresses of the Paying Agent and the offices or agencies referred to in
Section 4.2 of the Initial Indenture; 
 (7)      that Notes must be surrendered on or
prior to the Change of Control Purchase Date to the Paying Agent at the office of the Paying Agent or to an office or agency referred to in Section 4.2 of the Initial Indenture to collect payment; 

(8)      that the Change of Control Purchase Price for any Note which has been properly tendered
and not withdrawn will be paid promptly following the Change of Control Offer Purchase Date; 

(9)      the procedures for withdrawing a tender of Notes; 

(10)    that any Note not tendered will continue to accrue interest; and 

  
 -15- 

 (11)    that, unless the Company defaults in the payment of
the Change of Control Purchase Price, any Notes accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Purchase Date. 

(c)      Upon receipt by the Company of the proper tender of Notes, the Holder of the Note in respect of which
such proper tender was made shall (unless the tender of such Note is properly withdrawn) thereafter be entitled to receive solely the Change of Control Purchase Price with respect to such Note. Upon surrender of any such Note for purchase in
accordance with the foregoing provisions, such Note shall be paid by the Company at the Change of Control Purchase Price; provided, however, that installments of interest whose Stated Maturity is on or prior to the Change of Control
Purchase Date shall be payable to the Holders of such Notes registered as such on the relevant record dates according to the terms and the provisions of Section 2.3. If any Note tendered for purchase shall not be so paid upon surrender thereof,
the principal thereof (and premium, if any, thereon) shall, until paid, bear interest from the Change of Control Purchase Date at the rate borne by such Note. Holders electing to have Notes purchased will be required to surrender such Notes to the
Paying Agent at the address specified in the Change of Control Purchase Notice at least two Business Days prior to the Change of Control Purchase Date. Any Note that is to be purchased only in part shall be surrendered to a Paying Agent at the
office of such Paying Agent (with, if the note registrar designated pursuant to Section 4.2 of the Initial Indenture or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the
note registrar or the Trustee, as the case may be, duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing), and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such
Note, without service charge, one or more new Notes of any authorized denomination as requested by such Holder in an aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Note so surrendered that is not
purchased. 
 (d)      The Company shall (i) not later than the Change of Control Purchase Date, accept
for payment Notes or portions thereof tendered pursuant to the Change of Control Offer, (ii) not later than 11:00 a.m. (New York time) on the Change of Control Purchase Date, deposit with the Paying Agent an amount of cash sufficient to pay the
aggregate Change of Control Purchase Price of all the Notes or portions thereof which are to be purchased as of the Change of Control Purchase Date and (iii) not later than the Change of Control Purchase Date, deliver to the Paying Agent an
Officers’ Certificate stating the Notes or portions thereof accepted for payment by the Company. The Paying Agent shall promptly mail or deliver to Holders of Notes so accepted payment in an amount equal to the Change of Control Purchase Price
of the Notes purchased from each such Holder, and the Company shall execute and the Trustee shall promptly authenticate and mail or deliver to such Holders a new Note equal in principal amount to any unpurchased portion of the Note surrendered. Any
Notes not so accepted shall be promptly mailed or delivered by the Paying Agent at the Company’s expense to the Holder thereof. The Company will publicly announce the results of the Change of Control Offer on the Change of Control Purchase
Date. For purposes of this Section 3.2, the Company shall choose a Paying Agent which shall not be the Company. 

(e)      Tendered Notes may be withdrawn before or after delivery by the Holder to the Paying Agent at the
office of the Paying Agent of the Note to which such Change of Control Purchase Notice relates, by means of a written notice of withdrawal delivered by the Holder 

  
 -16- 

 
to the Paying Agent at the office of the Paying Agent or to the office or agency referred to in Section 4.2 of the Initial Indenture to which the related Change of Control Purchase Notice
was delivered not later than three Business Days prior to the Change of Control Purchase Date specifying, as applicable: 

(1)      the name of the Holder; 

(2)      the certificate number of the Note in respect of which such notice of withdrawal is
being submitted; 
 (3)      the principal amount of the Note (which shall be $2,000 or an
integral multiple of $1,000 in excess thereof) delivered for purchase by the Holder as to which such notice of withdrawal is being submitted; and 

(4)      the principal amount, if any, of such Note (which shall be $2,000 or an integral
multiple of $1,000 in excess thereof) that remains subject to the original Change of Control Purchase Notice and that has been or will be delivered for purchase by the Company. 

(f)      Subject to applicable escheat laws, as provided in the Notes, the Trustee and the Paying Agent shall
return to the Company any cash that remains unclaimed, together with interest or dividends, if any, thereon, held by them for the payment of the Change of Control Purchase Price; provided, however, that, (x) to the extent that the
aggregate amount of cash deposited by the Company pursuant to clause (ii) of paragraph (d) above exceeds the aggregate Change of Control Purchase Price of the Notes or portions thereof to be purchased, then the Trustee shall hold such
excess for the Company and (y) unless otherwise directed by the Company in writing, promptly after the Business Day following the Change of Control Purchase Date the Trustee shall return any such excess to the Company together with interest, if
any, thereon. 
 (g)      Notwithstanding the foregoing, the Company shall not be required to make a Change
of Control Offer following a Change of Control Triggering Event if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 3.2 applicable to a
Change of Control Offer made by the Company and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer. 

(h)      The Company shall comply with the applicable tender offer rules, including Rule 14e-1 under the Exchange Act, and any other applicable securities laws or regulations in connection with a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict
with the provisions of the Indenture or the Notes, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Indenture or the Notes as a result thereof. 

SECTION 3.3.      Limitation on Sale and Leaseback Transactions. 

So long as any of the Notes remain Outstanding, neither the Company nor any Subsidiary shall enter into any arrangement with any Person
(other than the Company or any Subsidiary) whereby the Company or a Subsidiary agrees to lease any Principal Property (except 

  
 -17- 

 
for leases for a term of not more than three years) which has been or is to be sold or transferred more than 120 days after the later of (i) such Principal Property having been acquired by
the Company or a Subsidiary and (ii) completion of construction and commencement of full operation thereof, by the Company or a Subsidiary to that Person unless (a) the net proceeds to the Company or a Subsidiary from the sale or transfer
equal or exceed the fair value, as determined by the Board of Directors, of the Principal Property so leased, (b) immediately after giving effect to such Sale and Leaseback Transaction, the Company’s Consolidated Fixed Charge Coverage
Ratio would be greater than 2.0 to 1.0, or (c) the Company, within 120 days after the effective date of the Sale and Leaseback Transaction, applies an amount equal to the fair value as determined by the Company’s Board of Directors of the
Principal Property so leased to (x) the prepayment or retirement of the Company’s Funded Debt, which may include the Notes; (y) the acquisition of additional real property for the Company or any Subsidiary. A Sale and Leaseback
Transaction shall not include any such arrangement for financing air, water or noise pollution control facilities or sewage or solid waste disposal facilities or involving industrial development bonds which are
tax-exempt pursuant to Section 103 of the Code (or which receive similar tax treatment under any subsequent amendments thereto or successor laws thereof). 

SECTION 3.4.      Additional Guarantees. 

In the event the Company (i) organizes or acquires any Subsidiary after the Issue Date that is not a Guarantor and such Subsidiary,
directly or indirectly, provides a guarantee of the Company’s obligations under the Senior Credit Facility or (ii) causes or permits any Subsidiary that is not a Guarantor to, directly or indirectly, guarantee the Company’s
obligations under the Senior Credit Facility, then, in each case the Company shall cause such Subsidiary to simultaneously execute and deliver a supplemental indenture to the Indenture pursuant to which it will become a Guarantor under the Indenture
with respect to the Notes. 
 If the Notes are defeased in accordance with the terms of Section 4.1, each Guarantor shall be released
and discharged of its Guarantee obligations in respect of the Indenture, the Supplemental Indenture and the Notes. The Guarantee of a Guarantor shall also be released and discharged as provided in Section 14.6 of the Initial Indenture. 

SECTION 3.5.      Waiver of Certain Covenants. 

The Company may omit in a particular instance to comply with any covenant or condition set forth in Sections 3.1 through 3.4, if, before or
after the time for such compliance, the Holders of not less than a majority in aggregate principal amount of the Notes at the time Outstanding shall, by act of such Holders, waive such compliance in such instance with such covenant or condition,
except as provided in Section 8.2, but no such waiver shall extend to or affect such covenant or condition except to the extent so expressly waived, and, until such waiver shall become effective, the obligations of the Company and the duties of
the Trustee in respect of any such covenant or condition shall remain in full force and effect. 
 ARTICLE FOUR 

DEFEASANCE 

  
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 The following provisions of this Article Four shall apply to the Notes (but not with respect to
any other series of Debt Securities). 
 SECTION 4.1.      Legal Defeasance. 

The Company will be deemed to have paid and the Company and the Guarantors will be discharged from any and all obligations in respect of the
Notes on the 91st day after the date of the deposit referred to in clause (a) of this Section 4.1, and the provisions of this Supplemental Indenture will no longer be in effect with respect to the Notes, and the Trustee, at the expense of
the Company, shall execute proper instruments acknowledging the same if: 
 (a)      the
Company has irrevocably deposited or caused to be irrevocably deposited with the Trustee and conveyed all right, title and interest to the Trustee for the benefit of the Holders of Notes, under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee as trust funds in trust, specifically pledged to the Trustee for the benefit of such Holders as security for payment of the principal of and interest, if any, on the Notes, and dedicated solely to, the benefit
of such Holders, in and to (1) money in an amount, (2) United States Government Obligations that, through the payment of interest and principal in respect thereof in accordance with their terms, will provide, not later than one day before
the due date of any payment referred to in this clause (a), money in an amount or (3) a combination thereof in an amount sufficient, in the opinion of a nationally recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge, without consideration of the reinvestment of such interest and after payment of all federal, state and local taxes or other charges and assessments in respect thereof payable by
the Trustee, the principal of and interest on the Outstanding Notes on the Stated Maturity of such principal or interest; provided, that the Trustee shall have been irrevocably instructed to apply such money or the proceeds of such United
States Government Obligations to the payment of such principal and interest with respect to the Notes; 

(b)      the Company has delivered to the Trustee either (x) an Opinion of Counsel to the
effect that Holders of Notes will not recognize income, gain or loss for federal income tax purposes as a result of the Company’s exercise of its option under this Section 4.1 and will be subject to federal income tax on the same amount
and in the same manner and at the same times as would have been the case if such option had not been exercised, which Opinion of Counsel shall be based upon (and accompanied by a copy of) a ruling of the Internal Revenue Service to the same effect
unless there has been a change in applicable federal income tax law after the Issue Date such that a ruling is no longer required or (y) a ruling directed to the Trustee received from the Internal Revenue Service to the same effect as the
aforementioned Opinion of Counsel; 
 (c)      immediately after giving effect to such
deposit, on a pro forma basis, no Default or Event of Default with respect to the Notes shall have occurred and be continuing on the date of such deposit or, insofar as Sections 5.1(f) and 5.1(g) are concerned, at any time during the period ending
on the 91st day after such date of such deposit; and 

  
 -19- 

 (d)      the Company has delivered to the Trustee
an Officers’ Certificate and an Opinion of Counsel, in each case stating that all conditions precedent provided for herein relating to the defeasance contemplated by this Section 4.1 have been complied with. 

Notwithstanding the foregoing paragraph, the Company’s obligations in Sections 2.4, 2.6, 2.8, 2.9, 2.10, 2.12, 2.13, 4.1, 4.2, 11.2 and
11.6 of the Initial Indenture and Sections 4.4, 4.5 and 5.1 hereof shall survive until the Notes are no longer Outstanding. Thereafter, the Company’s obligations in Sections 4.4 and 4.5 hereof shall survive and Section 11.2 of the Initial
Indenture shall survive. 
 After any such irrevocable deposit, the Trustee upon request shall acknowledge in writing the discharge of the
Company’s obligations under the Notes and the Indenture with respect to the Notes except for those surviving obligations in the immediately preceding paragraph. 

SECTION 4.2.      Defeasance of Certain Obligations. 

The Company may omit to comply with any term, provision or condition set forth in Sections 3.1, 3.2, 3.3 and 3.4 hereof and a breach with
respect to Sections 3.1, 3.2, 3.3 or 3.4 shall be deemed not to be an Event of Default, in each case with respect to the Outstanding Notes if: 

(a)      with reference to this Section 4.2, the Company has irrevocably deposited or
caused to be irrevocably deposited with the Trustee (or another trustee satisfying the requirements of the Initial Indenture) and conveyed all right, title and interest to the Trustee for the benefit of the Holders of Notes, under the terms of an
irrevocable trust agreement in form and substance satisfactory to the Trustee as trust funds in trust, specifically pledged to the Trustee for the benefit of such Holders as security for payment of the principal of and interest, if any, on the
Notes, and dedicated solely to, the benefit of such Holders, in and to (A) money in an amount, (B) United States Government Obligations that, through the payment of interest and principal in respect thereof in accordance with their terms,
will provide, not later than one day before the due date of any payment referred to in this clause (a), money in an amount or (C) a combination thereof in an amount sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the Trustee, to pay and discharge, without consideration of the reinvestment of such interest and after payment of all federal, state and local taxes or other charges and
assessments in respect thereof payable by the Trustee, the principal of and interest on the Outstanding Notes on the Stated Maturity of such principal or interest; provided, that the Trustee shall have been irrevocably instructed to apply
such money or the proceeds of such United States Government Obligations to the payment of such principal and interest with respect to the Notes; 

(b)      the Company has delivered to the Trustee an Opinion of Counsel to the effect that the
Holders of Notes will not recognize income, gain or loss for United States federal income tax purposes as a result of such deposit and defeasance of such covenants and Events of Default and will be subject to federal income tax on the same amount
and 

  
 -20- 

 
in the same manner and at the same times as would have been the case if such deposit and defeasance had not occurred; 

(c)      immediately after giving effect to such deposit on a pro forma basis, no Default or
Event of Default with respect to the Notes shall have occurred and be continuing on the date of such deposit or, insofar as Sections 5.1(f) and 5.1(g) are concerned, at any time during the period ending on the 91st day after such date of such
deposit; 
 (d)      if the Notes are then listed on a national securities exchange, the
Company has delivered to the Trustee an Opinion of Counsel to the effect that the Notes will not be delisted as a result of such deposit, defeasance and discharge; and 

(e)      the Company has delivered to the Trustee an Officers’ Certificate and an Opinion
of Counsel, in each case stating that all conditions precedent provided for herein relating to the defeasance contemplated by this Section 4.2 have been complied with. 

SECTION 4.3.      Application of Trust Money. 

Subject to Section 4.5, the Trustee or Paying Agent shall hold in trust money or United States Government Obligations deposited with it
pursuant to Section 4.1 or 4.2, as the case may be, and shall apply the deposited money and the proceeds from United States Government Obligations in accordance with the Notes and this Supplemental Indenture to the payment of principal of and
interest on the Notes; but such money need not be segregated from other funds except to the extent required by law. 
 SECTION
4.4.      Repayment to Company. 
 Subject to Sections 4.1 and 4.2, the Trustee and the Paying Agent
shall promptly pay to the Company upon request set forth in an Officers’ Certificate any excess money held by them at any time and thereupon shall be relieved from all liability with respect to such money. The Trustee and the Paying Agent shall
pay to the Company upon request any money held by them with respect to the Notes for the payment of principal or interest that remains unclaimed for two years; provided, that the Trustee or Paying Agent before being required to make any
payment may cause to be published at the expense of the Company once in a newspaper of general circulation in the City of New York or mail to each Holder of Notes entitled to such money at such Holder’s address notice that such money remains
unclaimed and that after a date specified therein (which shall be at least 30 days from the date of such publication or mailing) any unclaimed balance of such money then remaining will be repaid to the Company. After payment to the Company, Holders
of Notes entitled to such money must look to the Company or the Guarantors, as the case may be, for payment as general creditors unless an applicable law designates another Person, and all liability of the Trustee and such Paying Agent with respect
to such money shall cease. 
 SECTION 4.5.      Reinstatement. 

If the Trustee or Paying Agent is unable to apply any money or United States Government Obligations in accordance with Section 4.1 or
4.2, as the case may be, by reason of any legal proceeding or by reason of any order or judgment of any court or governmental author 

  
 -21- 

 
ity enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under the Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 4.1 or 4.2, as the case may be, until such time as the Trustee or Paying Agent is permitted to apply all such money or United States Government Obligations in accordance with Section 4.1 or 4.2, as the case may
be; provided, that, if the Company has made any payment of principal of or interest on any Notes because of the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of Notes to receive such payment
from the money or United States Government Obligations held by the Trustee or Paying Agent. 
 ARTICLE FIVE 

REMEDIES 
 The following
provisions of this Article Five shall apply to the Notes (but not with respect to any other series of Debt Securities) and shall replace in its entirety Section 7.1 of the Initial Indenture. 

SECTION 5.1.      Events of Default. 

Whenever used herein or in the Initial Indenture, an “Event of Default” means any one of the following events: 

(a)      there shall be a default in the payment of the principal of (or premium, if any, on)
any Note at its Maturity (upon acceleration, optional redemption or otherwise); 

(b)      there shall be a default in the payment of any interest on any Note when it becomes due
and payable, and such default shall continue for a period of 30 days; 
 (c)      there shall
be a default in the performance, or breach, of any other covenant or agreement of the Company or any Guarantor contained in the Notes or in the Indenture, and continuance of such default or breach for a period of at least 90 days after the date on
which written notice specifying such default or breach and requiring the Company or such Guarantor to remedy the same and stating that such notice is a “Notice of Default” hereunder shall have been given to the Company or such
Guarantor, as the case may be, by the Trustee, or to the Company or such Guarantor, as the case may be, and the Trustee by the Holders of at least 25% in aggregate principal amount of the then Outstanding Notes provided that, notwithstanding
the foregoing, in no event shall an Event of Default with respect to any failure by the Company to comply with Section 4.5 of the Initial Indenture or any failure by the Company to comply with the requirements of Section 314(a)(1) of
the Trust Indenture Act be deemed to have occurred unless (x) the report, document, or other information required pursuant to such sections is past due under the Initial Indenture by at least 180 days and (y) such failure to comply has not
been cured or waived prior to the 90th day after written notice to the Company by the Trustee or to the Company and the Trustee from the Holders of not less than 25% of the aggregate principal amount of the then Outstanding Notes; 

(d)      the failure by the Company to make any payment, on or before the end of the applicable
grace period, after the maturity of any indebtedness of the Company with an aggregate principal amount then outstanding in excess of $150.0 million or the accel 

  
 -22- 

 
eration of indebtedness of the Company with an aggregate principal amount then outstanding in excess of $150.0 million as a result of a default with respect to such indebtedness, and such
indebtedness, in either case, is not discharged or such acceleration shall not have been cured, waived, rescinded or annulled within a period of 30 days after there shall have been given, by registered or certified mail, to the Company by the
Trustee or to the Company and the Trustee by the Holders of at least 25% in aggregate principal amount of the Outstanding Notes, a written notice specifying such failure to pay or acceleration and requiring the Company to cause such acceleration to
be cured, waived, rescinded or annulled or to cause such indebtedness to be discharged and stating that such notice is a “Notice of Default” hereunder; 

(e)      any Guarantee of a Guarantor that is a Significant Subsidiary of the Company shall for
any reason cease to be, or be asserted in writing by any Guarantor or the Company not to be, in full force and effect and enforceable in accordance with its terms, except to the extent contemplated by the Indenture; 

(f)      there shall have been the entry by a court of competent jurisdiction of (i) a
decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable Bankruptcy Law or (ii) a decree or order adjudging the Company bankrupt or insolvent, or seeking reorganization, arrangement,
adjustment or composition of or in respect of the Company under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator (or other similar official) of the Company or of any substantial
part of their respective Properties, or ordering the winding up or liquidation of their affairs, and any such decree or order for relief shall continue to be in effect, or any such other decree or order shall be unstayed and in effect, for a period
of 60 consecutive days; or 
 (g)      (i) the Company commences a voluntary case or
proceeding under any applicable Bankruptcy Law or any other case or proceeding to be adjudicated bankrupt or insolvent, (ii) the Company consents to the entry of a decree or order for relief in respect of the Company in an involuntary case or
proceeding under any applicable Bankruptcy Law or to the commencement of any bankruptcy or insolvency case or proceeding against it, (iii) the Company files a petition or answer or consent seeking reorganization or relief under any applicable
federal or state law, (iv) the Company (1) consents to the filing of such petition or the appointment of, or taking possession by, a custodian, receiver, liquidator, assignee, trustee, sequestrator or similar official of the Company or of
any substantial part of its Properties, or (2) makes an assignment for the benefit of creditors. 
 The Company shall deliver to the
Trustee within five days after the occurrence thereof, written notice, in the form of an Officers’ Certificate, of any Default, its status and what action the Company is taking or proposes to take with respect thereto. 

SECTION 5.2.      Acceleration of Maturity; Rescission and Annulment. 

If an Event of Default shall occur and be continuing (other than an Event of Default pursuant to Section 5.1(f) or (g) with respect
to the Company), the Trustee or the Holders of not less than 25% in aggregate principal amount of the Notes then Outstanding may, and the 

  
 -23- 

 
Trustee at the request of the Holders of not less than 25% in aggregate principal amount of the Notes then Outstanding shall, declare all unpaid principal of, premium, if any, and accrued
interest on all the Notes to be due and payable immediately, by a notice in writing to the Company (and to the Trustee if given by the Holders of the Notes). If an Event of Default pursuant to Section 5.1(f) or (g) shall occur and be
continuing, all unpaid principal of, premium, if any, and accrued interest on all the Notes shall be due and payable immediately without any declaration or other act on the part of the Trustee or any Holder. Thereupon such principal shall become
immediately due and payable, and the Trustee may, at its discretion, proceed to protect and enforce the rights of the Holders of Notes by appropriate judicial proceeding. 

At any time after such acceleration has occurred but before a judgment or decree for payment of the money due has been obtained by the
Trustee, the Holders of a majority in aggregate principal amount of the Notes Outstanding, by written notice to the Company and the Trustee, may rescind and annul such declaration and its consequences if: 

(a)      the Company has paid or deposited with the Trustee a sum sufficient to pay 

(i)      all sums paid or advanced by the Trustee under Section 11.2 of the Initial
Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, 

(ii)      to the extent payment of such interest is lawful, if interest on overdue installments
of interest and overdue principal, which has become due otherwise than by such declaration of acceleration, has been paid, and 

(iii)      to the extent that payment of such interest is lawful, interest upon overdue
interest at the rate borne by the Notes; 
 (b)      all Events of Default, other than the non-payment of principal of the Notes which have become due solely by such declaration of acceleration, have been cured or waived as provided in Section 7.5 of the Initial Indenture; and 

(c)      the rescission will not conflict with any judgment or decree. 

No such rescission shall affect any subsequent Default or impair any right consequent thereon. 

ARTICLE SIX 
 MISCELLANEOUS
PROVISIONS 
 SECTION 6.1.      Ratification of Indenture. 

Except as expressly modified or amended hereby with respect to the Notes, the Initial Indenture continues in full force and effect and is in
all respects confirmed and preserved. 
 SECTION 6.2.      Governing Law. 

  
 -24- 

 This Supplemental Indenture, the Notes and the Guarantees will be governed by, and construed in
accordance with, the laws of the State of New York, without giving effect to the conflicts of law principles thereof. This Supplemental Indenture is subject to the provisions of the Trust Indenture Act and shall, to the extent applicable, be
governed by such provisions. 
 SECTION 6.3.      Counterparts. 

This Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and the same instrument. 
 ARTICLE SEVEN 

GUARANTEES 
 Each of the
Guarantors hereby jointly and severally guarantees the Notes on a senior unsecured basis on the terms set forth in Article Fourteen of the Initial Indenture. 

ARTICLE EIGHT 
 SUPPLEMENTAL
INDENTURES 
 The following provisions of this Article Eight shall apply to the Notes (but not with respect to any other series of Debt
Securities) and shall replace in their entirety Sections 12.1 and 12.2 of the Initial Indenture. To the extent this Article Eight is inconsistent with or conflicts with any provisions of Article Twelve in the Initial Indenture the provisions of this
Article Eight shall govern. 
 SECTION 8.1.      Supplemental Indentures and Agreements Without Consent of
Holders. 
 Without the consent of any Holders, the Company and the Guarantors, if any, when authorized by a Certified Resolution, and
the Trustee, at any time and from time to time, may enter into one or more indentures supplemental hereto or agreements or other instruments with respect to any Guarantee, in form and substance satisfactory to the Trustee, for any of the following
purposes: 
 (a)      to evidence the succession of another Person to the Company, any
Guarantor or any other obligor upon the Notes, and the assumption by any such successor of the covenants of the Company or such Guarantor or obligor herein and in the Notes and in any Guarantee pursuant to Article Ten of the Initial Indenture; 

(b)      to add to the covenants of the Company, any Guarantor or any other obligor upon the
Notes for the benefit of the Holders, or to surrender any right or power herein conferred upon the Company, any Guarantor or any other obligor upon the Notes, as applicable, herein, in the Notes or in any Guarantee; 

(c)      to cure any ambiguity, to cure or correct or supplement any provision herein which may
be defective or inconsistent with any other provision herein, in the Notes or in any Guarantee, or to make any change to any other provisions of this Sup 

  
 -25- 

 
plemental Indenture, the Indenture, the Notes or any Guarantee to the extent such change shall not adversely affect the interests of the Holders in any material respect; 

(d)      to comply with the requirements of the Commission in order to effect or maintain the
qualification of this Supplemental Indenture and the Initial Indenture under the Trust Indenture Act, as contemplated by Section 12.4 of the Initial Indenture or otherwise; 

(e)      to evidence and provide the acceptance of the appointment of a successor trustee
hereunder; 
 (f)      to mortgage, pledge, hypothecate or grant a security interest in favor
of the Trustee for the benefit of the Holders as security for the payment and performance of the Indenture Obligations, in any property or assets, including any which are required to be mortgaged, pledged or hypothecated, or in which a security
interest is required to be granted to the Trustee pursuant to this Supplemental Indenture, the Initial Indenture or otherwise; 

(g)      to add a Guarantor or to release a Guarantor in accordance with the terms of the
Indenture; or 
 (h)      to add to or change any of the provisions of this Indenture as
contemplated in Section 11.7(b) of the Initial Indenture; 
 and the Company hereby covenants that it will fully perform all the requirements of any
such supplemental indenture which may be in effect from time to time. Nothing in this Section 8.1 shall affect or limit the right or obligation of the Company to execute and deliver to the Trustee any instrument of further assurance or other
instrument which elsewhere in the Indenture it is provided shall be delivered to the Trustee. 
 The Trustee shall join with the Company in
the execution of any such supplemental indenture, make any further appropriate agreements and stipulations which may be therein contained and accept the conveyance, transfer, assignment, mortgage or pledge of any Property thereunder, but the Trustee
shall not be obligated to enter into any such supplemental indenture which adversely affects the Trustee’s own rights, duties or immunities under this Supplemental Indenture or otherwise. 

Any supplemental indenture authorized by the provisions of this Section 8.1 may be executed by the Company, the Guarantors and the
Trustee without the consent of the Holders of any of the Notes at the time Outstanding, notwithstanding any of the provisions of Section 8.2. The Trustee may rely on an Opinion of Counsel as conclusive evidence that the execution of any
amendment or supplemental indenture has been effected in compliance with this Section 8.1. 
 SECTION
8.2.      Supplemental Indentures and Agreements with Consent of Holders. 
 With the consent of the
Holders of not less than a majority in aggregate principal amount of the Outstanding Notes, by act of said Holders delivered to the Company, each Guar 

  
 -26- 

 
antor, if any, and the Trustee, the Company and each Guarantor (if a party thereto) when authorized by a Certified Resolution, and the Trustee, may enter into an indenture or indentures
supplemental hereto or agreements or other instruments with respect to any Guarantee in form and substance satisfactory to the Trustee, for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of
this Supplemental Indenture or the Initial Indenture or of modifying in any manner the rights of the Holders under this Supplemental Indenture, the Initial Indenture, the Notes or any Guarantee; provided, however, that no such
supplemental indenture, agreement or instrument shall, without the consent of the Holder of each Outstanding Note affected thereby: 

(a)      extend the Stated Maturity of the principal of, or any installment of interest on, any
Note, or reduce the principal amount thereof or the rate of interest thereon or any premium payable upon the redemption thereof, or change the coin or currency in which the principal of any Note or any premium or the interest thereon is payable, or
impair the right to institute suit for the enforcement of any such payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the redemption date thereof); 

(b)      following the occurrence of a Change of Control Triggering Event, amend, change or
modify the obligation of the Company to make and consummate a Change of Control Offer in the event of a Change of Control Triggering Event in accordance with Section 3.2, including amending, changing or modifying any definitions with respect
thereto; 
 (c)      reduce the percentage in principal amount of the Outstanding Notes, the
consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Supplemental Indenture or the Initial Indenture or certain defaults
hereunder and their consequences provided for in this Supplemental Indenture or the Initial Indenture or with respect to any Guarantee; 

(d)      modify any of the provisions of this Section 8.2, Section 3.5 of this
Supplemental Indenture, or Section 7.5 of the Initial Indenture, except to increase any such percentage or to provide that certain other provisions of this Supplemental Indenture or the Initial Indenture cannot be modified or waived without the
consent of the Holder of each Note affected thereby; 
 (e)      except as otherwise permitted
under Article Ten of the Initial Indenture, consent to the assignment or transfer by the Company of any of its rights and obligations under this Supplemental Indenture or the Initial Indenture; or 

(f)      change the currency of payment of principal, premium (if any) or interest on the Notes.

 Upon the written request of the Company and each Guarantor, if any, accompanied by a copy of a Certified Resolution authorizing the
execution of any such supplemental indenture or Guarantee, and upon the filing with the Trustee of evidence of the consent of Holders 

  
 -27- 

 
as aforesaid, the Trustee shall join with the Company and each Guarantor in the execution of such supplemental indenture or Guarantee. 

It shall not be necessary for any act of Holders under this Section 8.2 to approve the particular form of any proposed supplemental
indenture or Guarantee or agreement or instrument relating to any Guarantee, but it shall be sufficient if such act shall approve the substance thereof. 

[Remainder of Page Intentionally Blank.] 

  
 -28- 

 IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly
executed by their respective officers hereunto duly authorized, all as of the day and year first written above. 
  

					
	CONSTELLATION BRANDS, INC.
		
	By:	 	 /s/ Oksana S. Dominach 

		 	Name:	 	Oksana S. Dominach
		 	Title:	 	Senior Vice President and Treasurer
	
	GUARANTORS
	
	CONSTELLATION BRANDS SMO, LLC
	CONSTELLATION BRANDS U.S. OPERATIONS, INC.
	CONSTELLATION SERVICES LLC
	CROWN IMPORTS LLC
		
	By:	 	 /s/ Oksana S. Dominach

		 	Name:	 	Oksana S. Dominach
		 	Title:	 	Vice President and Treasurer
	
	HOME BREW MART, INC.
		
	By:	 	 /s/ Oksana S. Dominach 

		 	Name:	 	Oksana S. Dominach
		 	Title:	 	Vice President and Assistant Treasurer

  
 -29- 

 
					
	MANUFACTURERS AND TRADERS TRUST COMPANY, as Trustee
		
	By:	 	 /s/ Aaron G. McManus

		 	Name:	 	Aaron G. McManus
		 	Title:	 	Vice President

  
 -30- 

 Exhibit A
to                                   

Supplemental Indenture                 

{Face of Note} 
 THIS NOTE IS A GLOBAL SECURITY
WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY. TRANSFERS OF THIS NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO
NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTIONS 2.6 AND 2.13 OF THE
INITIAL INDENTURE AND SECTION 2.8 OF THE SUPPLEMENTAL INDENTURE.1 
 UNLESS THIS NOTE 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 SUCH 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.2 

 
  

 

	1 	Include this legend on any Global Security. 

  

	2 	Include this legend on any Global Security issued to Cede & Co. as nominee of The Depository Trust Company. 

  
 A-1 

 CONSTELLATION BRANDS, INC. 

 
  

2.000% SENIOR NOTE DUE 2019 
 CUSIP
NO. 21036PAU2 
  

			
	 No. [            ]
	  	$[            ]

 CONSTELLATION BRANDS, INC., a Delaware corporation (herein called the “Company,” which term
includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO. or registered assigns, the principal sum of
[                    ] United States Dollars on November 7, 2019, at the office or agency of the Company referred to below, and to pay interest
thereon from November 7, 2017, or from the most recent Interest Payment Date to which interest has been paid or duly provided for, semi-annually on May 7 and November 7 of each year, commencing May 7, 2018, at the rate of 2.000%
per annum, in United States Dollars, until the principal hereof is paid or duly provided for. Interest shall be computed on the basis of a 360-day year comprised of twelve
30-day months. 
 The interest so payable, and punctually paid or duly provided for, on any
Interest Payment Date will, as provided in such Indenture, be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the regular record date for such interest, which shall be
April 22 or October 23 (whether or not a Business Day), as the case may be, next preceding such Interest Payment Date. Any such interest not so punctually paid, or duly provided for, and interest on such defaulted interest at the interest
rate borne by the Notes, to the extent lawful, shall forthwith cease to be payable to the Holder on such regular record date, and may be paid to the Person in whose name this Note (or one or more predecessor Notes) 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 Notes not less than 15 days prior to such special record date, or may be paid at any time in any
other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture. 

Payment of the principal of, premium, if any, and interest on this Note will be made at the office or agency of the Company maintained for
that purpose, 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; provided, however, that payment of interest may be made at the option of the
Company, (i) in the case of a Global Security, by wire or book entry transfer to the Depository Trust Company or its nominee, or (ii) in all other cases, by check mailed to the address of the Person entitled thereto as such address shall
appear on the security register. 
 Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which
further provisions shall for all purposes have the same effect as if set forth at this place. 

  
 A-2 

 This Note is entitled to the benefits of Guarantees by each of the Guarantors of the punctual
payment when due of the Indenture Obligations made in favor of the Trustee for the benefit of the Holders. Reference is hereby made to Article Seven of the Supplemental Indenture and Article Fourteen of the Initial Indenture for a statement of the
respective rights, limitations of rights, duties and obligations under the Guarantees of each of the Guarantors. 
 Unless the certificate
of authentication hereon has been duly executed by the Trustee referred to on the reverse hereof or by the authenticating agent appointed as provided in the Initial Indenture by manual signature, this Note shall not be entitled to any benefit under
the Indenture, or be valid or obligatory for any purpose. 

  
 A-3 

 IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed by the manual or
facsimile signature of its authorized officer. 
 Dated: 
  

			
	CONSTELLATION BRANDS, INC.
		
	By:	 	
                     

		 	Name:
		 	Title:

  
 A-4 

 TRUSTEE’S CERTIFICATE OF AUTHENTICATION 

This is one of the 2.000% Senior Notes due 2019 referred to in the within-mentioned Indenture. 

 

			
	As Trustee, MANUFACTURERS AND TRADERS TRUST COMPANY
		
	By:	 	
                 

		 	Name:
		 	Title:

  
 A-5 

 {Reverse of Note} 

CONSTELLATION BRANDS, INC. 

2.000% SENIOR NOTE DUE 2019 

This Note is one of a duly authorized issue of Notes of the Company designated as its 2.000% Senior Notes due 2019 (herein called the
“Notes”), issued under an Indenture dated as of April 17, 2012, among the Company, the Guarantors and Manufacturers and Traders Trust Company (the “Trustee,” which term includes any successor Trustee under the
Indenture (as defined)) (the “Initial Indenture”), as supplemented by Supplemental Indenture No. 1 dated as of April 17, 2012 (the “First Supplemental Indenture”), Supplemental Indenture No. 2 dated
as of August 14, 2012 (the “Second Supplemental Indenture”), Supplemental Indenture No. 3 dated as of May 14, 2013 (the “Third Supplemental Indenture”), Supplemental Indenture No. 4 dated as of
May 14, 2013 (the “Fourth Supplemental Indenture”), Supplemental Indenture No. 5 dated as of June 7, 2013 (the “Fifth Supplemental Indenture”), Supplemental Indenture No. 6 dated as of
May 28, 2014 (the “Sixth Supplemental Indenture”), Supplemental Indenture No. 7 dated as of November 3, 2014 (the “Seventh Supplemental Indenture”), Supplemental Indenture No. 8 dated as of
November 3, 2014 (the “Eighth Supplemental Indenture”), Supplemental Indenture No. 9 dated as of December 4, 2015 (the “Ninth Supplemental Indenture”), Supplemental Indenture No. 10 dated as of
January 15, 2016 (the “Tenth Supplemental Indenture”), Supplemental Indenture No. 11 dated as of December 6, 2016 (the “Eleventh Supplemental Indenture”), Supplemental Indenture No. 12 dated as
of May 9, 2017 (the “Twelfth Supplemental Indenture”), Supplemental Indenture No. 13 dated as of May 9, 2017 (the “Thirteenth Supplemental Indenture”), Supplemental Indenture No. 14 dated as of
May 9, 2017 (the “Fourteenth Supplemental Indenture”), Supplemental Indenture No. 16 dated as of November 7, 2017 (the “Sixteenth Supplemental Indenture”), Supplemental Indenture No. 17 dated as
of November 7, 2017 (the “Seventeenth Supplemental Indenture”) and Supplemental Indenture No. 15 dated as of November 7, 2017 (the “Supplemental Indenture” and, together with the Initial Indenture,
the First Supplemental Indenture, the Second Supplemental Indenture, the Third Supplemental Indenture, the Fourth Supplemental Indenture, the Fifth Supplemental Indenture, the Sixth Supplemental Indenture, the Seventh Supplemental Indenture, the
Eighth Supplemental Indenture, the Ninth Supplemental Indenture, the Tenth Supplemental Indenture, the Eleventh Supplemental Indenture, the Twelfth Supplemental Indenture, the Thirteenth Supplemental Indenture, the Fourteenth Supplemental Indenture,
the Sixteenth Supplemental Indenture and the Seventeenth Supplemental Indenture, 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, obligations and immunities thereunder of the Company, the Guarantors, the Trustee and the Holders of the Notes, and of the terms upon which the Notes are, and are to be, authenticated and delivered. 

The Indenture contains provisions for defeasance at any time of (a) the entire indebtedness on the Notes or (b) certain restrictive
covenants and related Defaults and Events of Default, in each case upon compliance with certain conditions set forth therein. 
 At any
time prior to the Stated Maturity thereof, the Company may redeem the Notes, in whole or in part, at any time or from time to time, at a redemption price equal to the 

  
 A-6 

 
greater of (i) 100% of the principal amount of such Notes to be redeemed and (ii) the sum of the present values of the remaining scheduled payments of principal of and interest on the Notes
to be redeemed (not including any portion of such payments of interest accrued as of the redemption date) discounted to the redemption date on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate, plus 10 basis points, as determined by the Reference Treasury Dealer, plus, in each case, accrued and unpaid interest on the Notes to, but excluding the redemption date. 

Upon the occurrence of a Change of Control Triggering Event, each Holder may require the Company to repurchase all or a portion of such
Holder’s Notes (equal to $2,000 or an integral multiple of $1,000 in excess thereof), at a purchase price in cash equal to 101% of the principal amount thereof, together with accrued and unpaid interest, if any, to, but excluding, the date of
repurchase. 
 In the case of any redemption or repurchase of Notes in accordance with the Indenture, interest installments whose Stated
Maturity is on or prior to the redemption date will be available to the Holders of such Notes of record as of the close of business on the relevant regular record date referred to on the face hereof. Notes (or portions thereof) for whose redemption
and payment provision is made in accordance with the Indenture shall cease to bear interest from and after the date of redemption. 
 In
the event of redemption or repurchase of this Note in accordance with the Indenture in part only, a new Note or Notes for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof. 

If an Event of Default shall occur and be continuing, the principal amount of all the Notes may be declared due and payable in the manner and
with the effect provided in the Indenture. 
 The Indenture permits, with certain exceptions (including certain amendments permitted
without the consent of any Holders) as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Guarantors and the Holders under the Indenture and the Notes and the Guarantees at
any time by the Company and the Trustee with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes at the time Outstanding. The Indenture also contains provisions permitting the Holders of specified
percentages in aggregate principal amount of the Notes at the time Outstanding, on behalf of the Holders of all the Notes, to waive compliance by the Company and the Guarantors with certain provisions of the Indenture and the Notes and the
Guarantees and their consequences. Any such consent or waiver by or on behalf of the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Note issued upon the registration of
transfer hereof or in exchange hereof or in lieu hereof whether or not notation of such consent or waiver is made upon this Note. 
 No
reference herein to the Indenture and no provision of this Note or of the Indenture shall alter or impair the obligation of the Company, any Guarantor or any other obligor on the Notes (in the event such Guarantor or other obligor is obligated to
make payments in respect 

  
 A-7 

 
of the Notes), which is absolute and unconditional, to pay the principal of, premium, if any, and interest on this Note at the times, place, and rate, and in the coin or currency, herein
prescribed. 
 If this Note is in certificated form, then as provided in the Indenture and subject to certain limitations therein set
forth, the transfer of this Note is registrable on the security register of the Company, upon surrender of this Note for registration of transfer at the office or agency of the Company maintained for such purpose in the City of New York or at such
other office or agency of the Company as may be maintained for such purpose, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the security registrar designated in accordance with
Section 4.2 of the Initial Indenture duly executed by, the Holder hereof or its attorney duly authorized in writing, and thereupon one or more new Notes, of authorized denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees. 
 If this Note is a Global Security, it is exchangeable for a Note in certificated form as
provided in the Indenture and in accordance with the rules and procedures of the Trustee and the Depositary. In addition, certificated securities shall be transferred to all beneficial holders in exchange for their beneficial interests in the Global
Security if (x) the Depositary notifies the Company that it is unwilling or unable to continue as depository for the Global Security and a successor depository is not appointed by the Company within 90 days, (y) the Company decides to
discontinue use of the system of book-entry-only transfers through the Depository (or a successor securities depository) or (z) there shall have occurred and be continuing an Event of Default and any security registrar designated in accordance
with Section 4.2 of the Initial Indenture has received a request from the Depositary. Upon any such issuance, the Trustee is required to register such certificated Notes in the name of, and cause the same to be delivered to, such Person or
Persons (or the nominee of any thereof). 
 The Notes in certificated form are issuable only in registered form without coupons in
denominations of $2,000 and any integral multiple of $1,000 in excess thereof. 
 No service charge shall be made for any registration of
transfer or exchange of Notes, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith. 

Prior to and at the time of due presentment of this Note for registration of transfer, the Company, any Guarantor, the Trustee and any agent
of the Company, any Guarantor or the Trustee may treat the Person in whose name this Note is registered as the owner hereof for all purposes, whether or not this Note is overdue, and neither the Company, the Trustee nor any agent shall be affected
by notice to the contrary. 
 THIS NOTE SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO CONFLICTS OF LAWS PRINCIPLES THEREOF. 
 All terms used in this Note which are defined in the Indenture and not otherwise defined
herein shall have the meanings assigned to them in the Indenture. 

  
 A-8 

 FORM OF TRANSFER NOTICE 

I or we assign and transfer this Note to: 
 Please insert social
security or other identifying number of assignee 
  
 
                                         
                                         
                                         
                                         
     
  
 
                                         
                                         
                                         
                                         
     
  
 
                                         
                                         
                                         
                                         
     
 Print or type name, address and zip code of assignee and irrevocably appoint
             
 (Agent), to transfer this Note on the books of the Company. The Agent may
substitute another to act for him. 

Dated                   
                                         
     Signed                                  
                                         
        
 (Sign exactly as name appears on the other side of this Note) 

{Signature must be guaranteed by an eligible Guarantor Institution (banks, stock brokers, savings and loan associations and credit unions) with membership in
an approved guarantee medallion program pursuant to Securities and Exchange Commission Rule 17 Ad-15} 

  
 A-9 

 Exhibit B to 

Supplemental Indenture 
 GUARANTEES

 For value received, each of the undersigned hereby unconditionally guarantees, jointly and severally, to the Holder of this Note the
payment of principal of, premium, if any, and interest on this Note upon which these Guarantees are endorsed in the amounts and at the time when due and payable whether by declaration thereof, or otherwise, and interest on the overdue principal and
interest, if any, of this Note, if lawful, and the payment or performance of all other obligations of the Company under the Indenture or the Notes, to the Holder of this Note and the Trustee, all in accordance with and subject to the terms and
limitations of this Note and Article Fourteen of the Initial Indenture. These Guarantees will not become effective until the Trustee duly executes the certificate of authentication on this Note. 

Dated:
                                         
     
  

			
	GUARANTORS
	
	CONSTELLATION BRANDS SMO, LLC
	CONSTELLATION BRANDS U.S. OPERATIONS, INC.
	CONSTELLATION SERVICES LLC
	CROWN IMPORTS LLC
		
	By: 	 	
                     
                                        

		 	Name:
		 	Title:
	
	HOME BREW MART, INC.
		
	By: 	 	
                     
                                        

		 	Name:
		 	Title:

  
 B-1

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