Document:

capitalplan10-2020

                                           FHLB Des Moines Capital Plan                               Amended and Revised                                 September 5, 2011               (Approved by the Federal Housing Finance Agency on August 5, 2011)                        Further Amended on May 31, 2015               (Approved by the Federal Housing Finance Agency on May 31, 2015)                                                                                                   

 

                                    TABLE OF CONTENTS                                                                                                                                       Page      1.    Definitions................................................................................................................................................................. 1  2.    Capital Structure ....................................................................................................................................................... 2         2.1   Authorized Capital Stock ............................................................................................................................. 2         2.2   Stock Issuance and Retirement Procedures ................................................................................................. 2         2.3   Minimum Investment Requirements ............................................................................................................ 3         2.4   Membership Stock Requirements ................................................................................................................ 3         2.5   Activity Based Stock Requirements ............................................................................................................ 4   3.    Rights and Preferences .............................................................................................................................................. 4         3.1   Par Value ...................................................................................................................................................... 4         3.2   Ownership of Retained Earnings ................................................................................................................. 4         3.3   Voting Rights ............................................................................................................................................... 4         3.4   Dividends and Capital Distributions ............................................................................................................ 4         3.5   Liquidation ................................................................................................................................................... 5         3.6   Merger or Consolidation .............................................................................................................................. 5   4.    Redemption, Repurchase and Transfer ..................................................................................................................... 5         4.1   Capital Stock Redemption ........................................................................................................................... 5         4.2   Capital Stock Repurchases ........................................................................................................................... 7         4.3   Limitations on Capital Stock Redemption or Repurchase ........................................................................... 8         4.4   Transfer of Excess Stock ............................................................................................................................. 9   5.    Termination of Membership ..................................................................................................................................... 9         5.1   Voluntary Withdrawal from Membership.................................................................................................... 9         5.2   Involuntary Termination of Membership ................................................................................................... 10         5.3   Liquidation of Claims ................................................................................................................................ 10   6.    Treatment of Capital Stock in the Merger .............................................................................................................. 10   7.    Retained Earnings Enhancement Implementation and Definitions......................................................................... 11         7.1   Implementation .......................................................................................................................................... 11         7.2   Definitions applicable to Sections 7 through 10 of this Capital Plan ........................................................ 11   8.    Establishment of Restricted Retained Earnings ...................................................................................................... 13         8.1   Segregation of Account.............................................................................................................................. 13         8.2   Funding of Account ................................................................................................................................... 13   9.    Limitation on Dividends, Stock Purchase and Stock Redemption.......................................................................... 15         9.1    General Rule on Dividends ....................................................................................................................... 15                                          -i-                                     

 

                                    TABLE OF CONTENTS                                           (continued)                                                                                        Page             9.2   Limitations on Repurchase and Redemption ............................................................................................. 15  10.    Termination of Retained Earnings Capital Plan Amendment Obligations ............................................................. 15         10.1  Notice of Automatic Termination Event .................................................................................................... 15         10.2  Notice of Voluntary Termination ............................................................................................................... 17         10.3  Consequences of an Automatic Termination Event or Vote to Terminate the Agreement ........................ 17       Appendix I                                          -ii-                                    

 

                                                                                              1.    Definitions   For purposes of this Capital Plan, all capitalized terms used but not defined elsewhere have the following meanings:    “Acquired Member Assets” means assets sold to the Bank pursuant to 12 C.F.R. Part 955 (as such regulation may be   amended) and held on the Bank’s balance sheet.    “Activity Based Stock” means a subclass of Class B Stock that is required to be purchased and held in order to obtain an   advance and to engage in other transactions with the Bank.    “Activity Based Stock Requirement” means the level of Activity Based Stock that must be purchased and held in order to   obtain advances and engage in other transactions with the Bank.    “Additional Capital” means the loss absorbing, distributable capital component created in the Merger equal to the   difference between the fair value of the net assets acquired and the fair value of the Capital Stock issued in the Merger.     “Bank” means the Federal Home Loan Bank of Des Moines.    “Board of Directors” means the Board of Directors of the Bank.    “Cancellation Fee” means the fee the Bank will impose upon a Member that cancels or revokes a Notice of Redemption or   Notice of Withdrawal.    “Capital Plan” means the Bank’s plan for a capital structure as required by 12 U.S.C. 1426(b) (as such may be amended),   as approved by the Finance Agency.    “Capital Stock” means, collectively, the Class A Stock and Class B Stock authorized under this Capital Plan.    “Class A Stock” means the class A stock authorized for issuance under this Capital Plan.    “Class B Stock” means the class B stock authorized for issuance under this Capital Plan.     “Commitment” means any legally binding agreement that requires the Bank to make an advance, acquire Acquired   Member Assets, or otherwise transact business with a Member.    “Excess Shares” or “Excess Stock” means the amount or shares of each class or subclass of the Bank’s Capital Stock held   by a Member that exceeds or does not count towards that Member’s Minimum Investment.    “Finance Agency” means the Federal Housing Finance Agency, the regulator of the Federal Home Loan Bank System, or   any successor thereto.    “Member” means any institution that has been approved for membership in the Bank and has purchased the required   amount of Membership Stock.    “Membership Stock” means a subclass of Class B Stock that is required to be purchased and held as a condition of   membership in the Bank.    “Merger” means the merger of the Bank and the Federal Home Loan Bank of Seattle.    “Merger Effective Time” means the effective time of the Merger.                                                                                                1    

 

                                                                                             “Membership Stock Requirement” means the level of Membership Stock that must be purchased and maintained as a  condition of membership.   “Minimum Investment” means the amount of Membership Stock necessary for a stockholder to satisfy its Membership  Stock Requirement and the amount of Activity Based Stock necessary for a stockholder to satisfy its Activity Based Stock  Requirement.   “Notice of Redemption” means any written request by a Member to the Bank to redeem Capital Stock.   “Notice of Withdrawal” means the written notice by a Member to the Bank of that Member’s intention to withdraw from  membership in the Bank.   “Total Assets” means a Member’s total assets as reported to the Member’s primary regulator or on its audited financial  statement.      2.    Capital Structure         2.1   Authorized Capital Stock         The Bank issues Capital Stock only in accordance with 12 C.F.R. Section 931.2 (as such regulation may be        amended) and in accordance with this Capital Plan.         Capital Stock is composed of the following classes:            •  Class A Stock; and            •  Class B Stock.        The Class B Stock is composed of the following sub-classes:            •  Membership Stock; and            •  Activity Based Stock.        2.2    Stock Issuance and Retirement Procedures        The Bank acts as its own transfer agent and issues all stock in book-entry form.        The Bank does not issue fractional shares of Capital Stock. A Minimum Investment shall be rounded up to the       next $100. Any dividend declared in the form of Capital Stock shall be rounded down to the next $100 and any       fractional shares shall be distributed in the form of a cash dividend.        Capital Stock may be purchased and held only by Members, former Members that are required to hold Capital       Stock after their membership has terminated in order to support outstanding advances and other transactions with       the Bank, and entities that acquire Members, such as through mergers or consolidations, but which themselves are       not Members.                                                                                               2          

 

                                                                                        The Bank issues Capital Stock in a stockholder’s name, credits the stockholder’s Class A Stock, Membership  Stock or Activity Based Stock balance, as appropriate, and debits the stockholder’s demand deposit account for  any payment due.   Upon redemption or repurchase of Capital Stock, the Bank retires the stock, debits the stockholder’s Class A  Stock, Membership Stock or Activity Based Stock balance, as appropriate, and credits the stockholder’s demand  deposit account with any proceeds.   The Bank shall not permit a stockholder to convert any Excess Shares of Capital Stock between classes or sub- classes of Capital Stock.   2.3   Minimum Investment Requirements   The Board of Directors has a continuing obligation to review and adjust the Minimum Investment as necessary to  ensure that the Bank remains in compliance with its capital requirements. The Bank shall provide notice to each  stockholder of any adjustment to the Minimum Investment and the effective date of any such adjustment at least  15 days prior to the effective date of any such adjustment. Upon the effective date of any such adjustment, the  Bank shall, as applicable, issue any Capital Stock in accordance with section 2.2 or repurchase any Capital Stock  in accordance with section 4.   A stockholder must comply promptly with any adjustments the Board of Directors makes to the Minimum  Investment.   2.4   Membership Stock Requirements    The Board of Directors has established a Membership Stock Requirement identified in Appendix I. The Board of   Directors may adjust the Membership Stock Requirement within the ranges specified in Appendix I. Each   Member is required to purchase and maintain Membership Stock in an amount equal to its Membership Stock   Requirement, as calculated by the Bank.    At least annually, the Bank calculates each Member’s Membership Stock Requirement as a percentage of Total   Assets as of the preceding December 31st. The Bank will notify each Member of its Membership Stock   Requirement at least 15 days prior to the effective date of any adjustments that the Bank shall make to the   Member’s Membership Stock balance as a result of such annual calculation. If a Member’s Membership Stock   Requirement has increased since the last time the Bank calculated the Member’s Membership Stock Requirement,   the Bank shall issue Membership Stock in accordance with section 2.2.   The Bank, in its discretion, may recalculate any Member’s Membership Stock Requirements more often than  annually if the Bank deems it appropriate. The Bank may recalculate a Member’s Membership Stock  Requirement if requested by the Member, or in the Bank’s discretion. In each of these cases, the Bank will  calculate the Membership Stock Requirement based on the Member’s Total Assets as of the end of the most  recent calendar quarter for which financial information is available.   Notwithstanding any other provision of this Capital Plan, in the event that (a) a Member becomes insolvent or   otherwise subject to the appointment of a conservator, receiver or other legal custodian under federal or state law,   and (b) the Bank has terminated the Member’s membership, then that Member’s Membership Stock Requirement   shall be zero.                                                                                     3          

 

                                                                                                  2.5   Activity Based Stock Requirements         The Board of Directors has established an Activity Based Stock Requirement identified in Appendix I. The Board        of Directors may adjust the Activity Based Stock Requirement within the ranges specified in Appendix I. The        Board of Directors may apply changes in the Activity Based Stock Requirement to any advances, whether new or        existing, and other transactions.         Each stockholder is required to purchase and maintain Activity Based Stock in an amount equal to its Activity        Based Stock Requirement, as calculated by the Bank, as long as the advance or other transaction remains recorded        on the Bank’s books and records.           The Bank calculates each stockholder’s Activity Based Stock Requirement daily. The Bank shall notify each        stockholder of any increase in its Activity Based Stock Requirement and issue Activity Based Stock to the        stockholder in accordance with section 2.2.         2.6   Class A Stock         No shares of Class A Stock shall be issued by the Bank except upon the automatic conversion, at the Merger        Effective Time, of any shares of Class A Stock of the Federal Home Loan Bank of Seattle issued and outstanding        immediately prior to the Merger Effective Time into the shares of Class A Stock.          Shares of Class A Stock cannot be used to satisfy the Minimum Investment of any stockholder.  All issued and        outstanding shares of Class A Stock shall constitute Excess Stock, subject to repurchase by the Bank as provided        in section 4.2.3.               3.    Rights and Preferences         3.1   Par Value         Capital Stock shall be issued, transferred, redeemed, and repurchased at a par value of $100.         3.2   Ownership of Retained Earnings          The retained earnings, paid-in surplus, Additional Capital, undivided profits and equity reserves, if any, of the        Bank are owned by the stockholders of Class B Stock in an amount proportional to the stockholder’s share of the        total shares of issued and outstanding Class B Stock.  Such stockholders have no right to receive any portion of        these items except through the declaration of a dividend or capital distribution approved by the Board of Directors        or upon liquidation of the Bank.         3.3   Voting Rights         The voting rights associated with Capital Stock are defined in and governed by the Finance Agency’s regulations.        No share of Capital Stock shall have any voting preference.         3.4   Dividends and Capital Distributions         Except as otherwise provided herein or by regulation or statute, the Board of Directors has sole discretion to        determine the amount, form, frequency and timing of dividend payments and capital distributions for each class                                                                                              4          

 

                                                                                                    and subclass of Capital Stock. The Board of Directors may declare different dividends or capital distributions for        any class or subclass of Capital Stock.          Dividend payments may be made in the form of cash, additional shares of Capital Stock, or a combination thereof        as determined by the Board of Directors. Capital distributions may only be made in the form of cash.  Unless the        Board of Directors declares otherwise, dividends and capital distributions are non-cumulative.           Dividends may only be paid from current earnings, previously retained earnings or, subject to the approval of the        Finance Agency, Additional Capital. Capital distributions may only be paid from Additional Capital.  The Board        of Directors may not declare or pay any dividends or make any capital distributions if the Bank is not in        compliance with its capital requirements or, if after paying the dividend or making the capital distribution, the        Bank would not be in compliance with its capital requirements.         Each stockholder will be entitled to receive applicable dividends and capital distributions on Capital Stock held        during the applicable dividend or capital distribution period for the period of time the stockholder owned the        Capital Stock. The Bank pays dividends and capital distributions on Capital Stock as long as it is issued and        outstanding, regardless of whether a Member has provided a Notice of Redemption or Notice of Withdrawal or a        stockholder has terminated membership for any reason.         3.5   Liquidation         If the Bank is liquidated, after payment in full to the Bank’s creditors, the Bank’s stockholders shall be entitled to        receive the par value of their Class B Stock, as well as any retained earnings, paid-in surplus and Additional        Capital, in an amount proportional to the stockholder’s share of the total shares of Class B Stock. If any shares of         Class A Stock remain outstanding at the time of liquidation, the Class A stockholders will be entitled to        receive the par value of their stock (but no additional amounts), prior to the distribution of any retained        earnings, paid-in surplus or Additional Capital to the Class B stockholders.  A liquidation of the Bank shall also        be subject to any terms and conditions imposed by the Finance Agency.         3.6   Merger or Consolidation         The Board of Directors shall determine the rights and preferences of the Bank’s stockholders in connection with        any merger or consolidation, subject to any terms and conditions imposed by the Finance Agency.            4.    Redemption, Repurchase and Transfer         4.1    Capital Stock Redemption         Class B Stock is redeemable on five years’ written notice to the Bank. Class A Stock is redeemable on six        months’ written notice to the Bank. The Bank shall not be obligated to redeem a Member’s Capital Stock other        than in accordance with the Capital Plan, and is not permitted to redeem Capital Stock if such redemption would        cause the Member to fail to meet its Minimum Investment or is otherwise prohibited pursuant to section 4.3.                4.1.1 Notice of Redemption                A Member may redeem Capital Stock by providing a Notice of Redemption to the Bank specifying the               class or sub-class and the number of shares of Capital Stock to be redeemed. A Member shall not have               more than one Notice of Redemption outstanding at any one time for the same shares of Capital Stock.                                                                                                5    

 

                                                                                  The redemption period commences upon the Bank’s receipt of the Notice of Redemption. The Bank  honors Notices of Redemption in the order in which the Bank receives them.   The Bank shall redeem the Capital Stock identified in a Notice of Redemption following the expiration of  the redemption period and pay the stated par value of that Capital Stock to the Member in cash in  accordance with section 2.2 and subject to the limitations set forth in section 4.3, unless the Bank  exercises its discretionary authority to repurchase Excess Stock in accordance with section 4.2 prior to  that time.   4.1.2 Cancellation of Notice of Redemption   A Member may cancel a Notice of Redemption prior to the end of the redemption period by providing  written notice to the Bank of its intent to cancel its Notice of Redemption. The Bank will charge the  Member a Cancellation Fee equal to the following:       •  one percent of the par value of the shares of Capital Stock subject to the Notice of Redemption if         the Bank receives the cancellation of Notice of Redemption within one year of the day the Bank         received the Notice of Redemption;       •  two percent of the par value of the shares of Capital Stock subject to the Notice of Redemption if         the Bank receives the cancellation of Notice of Redemption within two years of the day the Bank         received the Notice of Redemption;       •  three percent of the par value of the shares of Capital Stock subject to the Notice of Redemption         if the Bank receives the cancellation of Notice of Redemption within three years of the day the         Bank received the Notice of Redemption;       •  four percent of the par value of the shares of Capital Stock subject to the Notice of Redemption if         the Bank receives the cancellation of Notice of Redemption within four years of the day the Bank        received the Notice of Redemption; or       •  five percent of the par value of the shares of Capital Stock subject to the Notice of Redemption if         the Bank receives the cancellation of Notice of Redemption within five years of the day the Bank         received the Notice of Redemption.   The Board of Directors may change the Cancellation Fee to any percentage of the par value of the shares  of Capital Stock subject to the cancelled Notice of Redemption that is not less than 0.0 percent and not  more than the percentages specified in the preceding paragraph. If the Board of Directors changes the  Cancellation Fee, the Board of Directors will also determine whether the changed Cancellation Fee will  apply to the cancellation of any previously submitted Notice of Redemption as well as those submitted in  the future. Otherwise, the Cancellation Fee in effect at the time the Bank received the Notice of  Redemption will apply to the cancellation of that Notice of Redemption. The Bank will notify Members  in writing at least 15 days in advance of any changes in the Cancellation Fee.   A Notice of Redemption by a Member (whose membership has not been terminated) shall be  automatically cancelled if, within five business days after the end of the applicable redemption notice  period, the Bank is prevented from redeeming the Member’s Capital Stock because the Member would  fail to maintain its Minimum Investment after such redemption. The automatic cancellation (in full or to  the extent required) shall have the same effect as a voluntary cancellation and the Bank shall impose the  Cancellation Fee described in the preceding paragraph.                                                                       6          

 

                                                                                              4.1.3 Notice of Withdrawal         The Bank’s receipt of a Notice of Withdrawal commences the five-year redemption period for all Class B        Stock or the six-month redemption for all Class A Stock held by that Member, in each case, that is not        already subject to a pending Notice of Redemption. The redemption period for Membership Stock        purchased subsequent to the Bank’s receipt of a Member’s Notice of Withdrawal shall be deemed to have        commenced when the Bank issued such Membership Stock. Following the expiration of the redemption        period, the Bank shall pay the stated par value of the Capital Stock to the Member in cash, in accordance        with section 2.2 and subject to the limitations set forth in sections 4.3 and 5.3.         4.1.4 Cancellation of Notice of Withdrawal         A Member may cancel a Notice of Withdrawal prior to the end of the redemption period by providing        written notice to the Bank of its intent to cancel its Notice of Withdrawal. The Bank will charge the        Member a Cancellation Fee on the par value of the Member’s Capital Stock balance as described in        section 4.1.2.         4.1.5 Termination of Membership         If an institution’s membership has been terminated as a result of a merger or consolidation into a        nonmember or into a member of another Federal Home Loan Bank, the redemption period for any Capital        Stock that is not subject to a pending Notice of Redemption shall be deemed to commence on the date on        which the charter of the former member is terminated.         If an institution’s membership is involuntarily terminated, the redemption period for all Capital Stock        owned by the former member and not already subject to a pending Notice of Redemption shall commence        on the date that the Board of Directors terminates the institution’s membership.   4.2   Capital Stock Repurchases   The Bank, in its discretion, may repurchase any Excess Shares without regard to any redemption period.         4.2.1 Membership Stock         Upon 15 days written notice to Members, the Bank may, in its sole discretion, repurchase Membership        Stock which the Bank determines is Excess Stock without regard to the five-year redemption notice        period. The Bank shall repurchase any such Excess Stock in accordance with section 2.2 and subject to        the limitations set forth in section 4.3.         Any repurchase of Membership Stock automatically reduces the amount of Membership Stock that is the        subject of any outstanding Notice of Redemption by the amount of Membership Stock repurchased. If a        Member has Membership Stock that is subject to more than one Notice of Redemption, the Bank will        automatically reduce the amount of Membership Stock that is subject to such outstanding Notices of        Redemption in the same order in which the Bank received such Notices of Redemption.         A Member’s submission of a Notice of Withdrawal in accordance with section 5.1, or its termination of        membership in any other manner, will not, in and of itself, cause any Membership Stock to be deemed        Excess Stock for purposes of this section.                                                                                             7          

 

                                                                                              4.2.2 Activity Based Stock           Each Member may hold Excess Shares of Activity Based Stock up to the operational threshold        established in Appendix I. The Board of Directors may, from time to time, increase or decrease the        operational threshold within ranges specified in Appendix I. The Bank will notify each Member of a        change in the operational threshold at least 15 days prior to implementing the change.         The Bank will repurchase any Excess Shares of Activity Based Stock that exceed the operational         threshold established in Appendix I, on at least a scheduled, monthly basis in accordance with section 2.2         and subject to the limitations set forth in section 4.3. The Bank will notify Members at least 15 days in         advance of the scheduled date(s) for repurchasing Activity Based Stock and prior to implementing any         changes in the scheduled date(s) for repurchasing Activity Based Stock.          4.2.3 Class A Stock            The Bank may repurchase any shares of Class A Stock at any time; provided, that the Bank will notify         Members at least 15 days in advance of the scheduled date(s) for repurchasing Class A Stock and prior to         implementing any changes in the scheduled date(s) for repurchasing Class A Stock.              4.3   Limitations on Capital Stock Redemption or Repurchase    The Bank will not redeem or repurchase Capital Stock:       •  without the prior written approval of the Finance Agency, if the Finance Agency or the Board of Directors        has determined that the Bank has incurred, or is likely to incur, losses that result in or are likely to result        in charges against the capital of the Bank. This prohibition shall apply even if the Bank is in compliance        with its capital requirements, and shall remain in effect for however long the Bank continues to incur such        charges or until the Finance Agency determines that such charges are not expected to continue; or       •  if the redemption or repurchase would cause the Bank to be out of compliance with its capital         requirements; or       •  if the redemption or repurchase would cause a stockholder to be out of compliance with its Minimum         Investment; or       •  if the sum of all requested Capital Stock redemptions that the Bank is scheduled to make on any date         equals or exceeds the amount that would cause the Bank to fall below its capital requirements, in which         case the Bank will process redemptions in the order in which notification was received, but in no case will         the Bank redeem Capital Stock to the point that it would fail to meet its capital requirements.   The Bank, upon the approval of its Board of Directors, or of a subcommittee thereof, may suspend redemption of  Capital Stock if the Bank reasonably believes that continued redemption of Capital Stock would cause the Bank to  fail to meet its capital requirements, would prevent the Bank from maintaining adequate capital against a potential  risk that may not be adequately reflected in its capital requirements, or would otherwise prevent the Bank from  operating in a safe and sound manner. The Bank will notify the Finance Agency in writing within two business  days of the date of the decision to suspend the redemption of Capital Stock, informing the Finance Agency of the  reasons for the suspension and of the Bank’s strategies and time frames for addressing the conditions that led to  the suspension. The Finance Agency may require the Bank to re-institute the redemption of Capital Stock. The                                                                                    8          

 

                                                                                                  Bank will not repurchase any Capital Stock without the written permission of the Finance Agency during any       period in which the Bank has suspended redemption of Capital Stock under this paragraph.        4.4   Transfer of Excess Stock        With the prior approval of the Bank, a Member may transfer Excess Stock to another Member that controls, is       controlled by, or is under common control with the Member.        If a Member that has filed a Notice of Redemption transfers Excess Stock that is subject to that notice to another       Member, the transfer shall be deemed to be a cancellation of the Notice of Redemption on the Excess Stock       transferred upon the effective date of the transfer. The transferring Member shall be responsible for paying any       applicable Cancellation Fees in accordance with section 4.1.2.        If a Member that has filed a Notice of Withdrawal transfers Excess Stock to another Member, the transfer shall be       deemed to be a cancellation of the five-year redemption period on the Excess Stock transferred. The transferring       Member shall be responsible for paying any applicable Cancellation Fees in accordance with section 4.1.2.        The Bank shall transfer Capital Stock only in accordance with 12 C.F.R. Section 931.6 (as such regulation may        be amended). The Bank will not approve a Capital Stock transfer if the transfer would result in the transferring        Member being out of compliance with its Minimum Investment. Capital Stock may be traded only between the        Bank and its Members. All Capital Stock transfers are to be at par value and are effective upon being recorded on        the appropriate books and records of the Bank.            5.    Termination of Membership          A Member’s submission of a Notice of Withdrawal, or its termination of membership in any other manner, shall        not, in and of itself, cause any Capital Stock to be deemed Excess Stock.         If a former Member’s membership has been withdrawn, terminated involuntarily, or terminated as a result of a        merger or consolidation, the Bank shall redeem or repurchase such former Member’s Capital Stock in accordance        with section 4 and subject to the limitations in sections 4.1, 4.2, 4.3 and 5.3.         5.1   Voluntary Withdrawal from Membership         Any institution may withdraw from membership by providing a Notice of Withdrawal.         A Member that has submitted its Notice of Withdrawal continues to have access to the benefits of membership        until the effective date of its withdrawal, but the Bank does not have to provide any further services, including        advances, that would mature or otherwise terminate subsequent to the effective date of the withdrawal.         The membership of an institution that has submitted a Notice of Withdrawal shall terminate five years from the        date of the Bank’s receipt of the Member’s Notice of Withdrawal, unless the institution has cancelled its Notice of        Withdrawal prior to that date.         5.2   Involuntary Termination of Membership          The Board of Directors may terminate a Member’s membership pursuant to the Finance Agency’s regulations. A        Member whose membership is terminated involuntarily shall cease being a Member as of the date on which the                                                                                              9          

 

                                                                                                    Board of Directors acts to terminate the membership, and the institution shall have no right to obtain any of the        benefits of membership after that date, but shall be entitled to receive any dividends declared on its Capital Stock        until the Capital Stock is redeemed or repurchased by the Bank.         5.3   Liquidation of Claims          If an institution withdraws from membership or has its membership terminated, the Bank will determine an        orderly manner for:             •  liquidating all outstanding indebtedness (including prepayment fees) owed by that Member to the Bank,               and              •  settling all other claims against the Member.         If an institution that withdraws from membership or has its membership terminated remains indebted to the Bank        or has outstanding any transactions with the Bank after the effective date of its termination of membership, the        Bank shall not redeem or repurchase any Activity Based Stock or Class A Stock if such redemption or repurchase        is subject to any of the limitations in section 4.3. The Bank shall redeem or repurchase any Activity Based Stock        and Class A Stock in accordance with section 4.      6.    Treatment of Capital Stock in the Merger         Each share of Capital Stock of the Bank issued and outstanding immediately prior to the Merger Effective Time         will, at the Merger Effective Time, automatically and without any further action by the holder of such share, be        designated as Class B Stock, of the same subclass as it was immediately prior to the Merger Effective Time.        Each former stockholder of the Federal Home Loan Bank of Seattle will be required to satisfy the Minimum        Investment requirements set forth in section 2 and Appendix I of this Capital Plan as of the Merger Effective        Time.  The Class B Stock of the Bank issued in the Merger to each former stockholder of the Federal Home Loan        Bank of Seattle at the Merger Effective Time will, first, be allocated to satisfy such stockholder’s Membership        Stock Requirement, and any remaining Class B Stock issued in the Merger to such former Federal Home Loan        Bank of Seattle stockholders will be allocated as Activity Based Stock.  If a former stockholder of the Federal        Home Loan Bank of Seattle does not own sufficient Class B Stock to satisfy the Minimum Investment        requirements as of the Merger Effective Time, then the Bank will issue additional shares of Class B Stock and        debit such stockholder’s demand deposit account at the Bank in accordance with section 2.2.                      7.    Retained Earnings Enhancement Implementation and Definitions         7.1   Implementation         The provisions of sections 7 through 10 shall become effective upon, and only upon, the occurrence of the Interim        Capital Plan Amendment Implementation Date. Until the Restriction Termination Date, in the event of any                                                                                                10    

 

                                                                                        conflict between sections 7 through 10 and the remainder of this Capital Plan, the applicable terms of sections 7  through 10 shall govern, and shall be interpreted in a manner such that the restrictions set forth therein are  supplementary to, and not in lieu of, the requirements of the remainder of this Capital Plan.   7.2   Definitions applicable to Sections 7 through 10 of this Capital Plan   As used in these sections 7 through 10, the following capitalized terms shall have the following meanings.  Other  capitalized terms used but not defined in these sections 7 through 10, shall have the meanings set forth in section  1 of this Capital Plan.    “Act” means the Federal Home Loan Bank Act, as amended as of the Effective Date.    “Adjustment to Prior Net Income” means either an increase, or a decrease, to a prior calendar quarter’s Quarterly   Net Income subsequent to the date on which any allocation to Restricted Retained Earnings for such calendar   quarter was made.    “Agreement” means the Joint Capital Enhancement Agreement adopted by the FHLBanks on the Effective Date   and amended on the date on which the FHFA has approved the Retained Earnings Capital Plan Amendments for   all of the FHLBanks that have issued capital stock pursuant to a capital plan as of the Effective Date.    “Allocation Termination Date” means the date the Bank’s obligation to make allocations to the Restricted   Retained Earnings account is terminated permanently. That date is determined pursuant to section 10 of this   Capital Plan.    “Automatic Termination Event” means (i) a change in the Act, or another applicable statute, occurring subsequent   to the Effective Date, that will have the effect of creating a new, or higher, assessment or taxation on net income   or capital of the FHLBanks, or (ii) a change in the Act, another applicable statute, or the Regulations, occurring   subsequent to the Effective Date, that will result in a higher mandatory allocation of an FHLBank’s Quarterly Net   Income to any Retained Earnings account than the annual amount, or total amount, specified in an FHLBank’s   capital plan as in effect immediately prior to the Automatic Termination Event.    “Automatic Termination Event Declaration Date” means the date specified in section 10.1.1 or 10.1.2 of this   Capital Plan.    “Bank’s Total Consolidated Obligations” means the daily average carrying value for the calendar quarter,   excluding the impact of fair value adjustments (i.e., fair value option and hedging adjustments), of the Bank’s   portion of outstanding System Consolidated Obligations for which it is the primary obligor.    “Declaration of Automatic Termination” means a signed statement, executed by officers authorized to sign on   behalf of each FHLBank that is a signatory to the statement, in which at least 2/3 of the then existing FHLBanks   declare their concurrence that a specific statutory or regulatory change meets the definition of an Automatic   Termination Event.    “Dividend” means a distribution of cash, other property, or stock to a Stockholder with respect to its holdings of   Capital Stock.    “Dividend Restriction Period” means any calendar quarter: (i) that includes the REFCORP Termination Date, or   occurs subsequent to the REFCORP Termination Date; (ii) that occurs prior to an Allocation Termination Date;   and (iii) during which the amount of the Bank’s Restricted Retained Earnings is less than the amount of the   Bank’s RREM. If the amount of the Bank’s Restricted Retained Earnings is at least equal to the amount of the                                                                                    11          

 

                                                                                        Bank’s RREM, and subsequently the Bank’s Restricted Retained Earnings becomes less than its RREM, the Bank  shall be deemed to be in a Dividend Restriction Period (unless an Allocation Termination Date has occurred).    “Effective Date” means February 28, 2011.    “GAAP” means accounting principles generally accepted in the United States as in effect from time to time.    “FHFA” means the Federal Housing Finance Agency, or any successor thereto.    “FHLBank” means a Federal Home Loan Bank chartered under the Act.    “Interim Capital Plan Amendment Implementation Date” means 31 days after the date by which the FHFA has   approved a capital plan amendment substantially the same as the Retained Earnings Capital Plan Amendment for   all of the FHLBanks that have issued capital stock pursuant to a capital plan as of the Effective Date.    “Net Loss” means that the Quarterly Net Income of the Bank is negative, or that the annual net income of the   Bank calculated on the same basis is negative.    “Quarterly Net Income” means the amount of net income of an FHLBank for a calendar quarter calculated in   accordance with GAAP, after deducting the FHLBank’s required contributions for that quarter to the Affordable  Housing Program under section 10(j) of the Act, as reported in the FHLBank’s quarterly and annual financial  statements filed with the Securities and Exchange Commission.    “REFCORP Termination Date” means the last day of the calendar quarter in which the FHLBanks” final regular   payments are made on obligations to REFCORP in accordance with Section 997.5 of the Regulations and Section   21B(f) of the Act.    “Regular Contribution Amount” means the result of (i) 20 percent of Quarterly Net Income; plus (ii) 20 percent of   a positive Adjustment to Prior Net Income for any prior calendar quarter that includes the REFCORP Termination   Date, or occurred subsequent to the REFCORP Termination Date, to the extent such adjustment has not yet been   made in the current calendar quarter; minus (iii) 20 percent of the absolute value of a negative Adjustment to Prior   Net Income for any prior calendar quarter that includes the REFCORP Termination Date, or occurred subsequent   to the REFCORP Termination Date, to the extent such adjustment has not yet been made in the current calendar   quarter.    “Regulations” mean: (i) the rules and regulations of the Federal Housing Finance Agency (except to the extent   that they may be modified, terminated, set aside or superseded by the Director of the FHFA) in effect on the   Effective Date; (ii) the rules and regulations of the FHFA, as amended from time to time.    “Restricted Retained Earnings” means the cumulative amount of Quarterly Net Income and Adjustments to Prior   Net Income allocated to the Bank’s Retained Earnings account restricted pursuant to the Retained Earnings   Capital Plan Amendment, and does not include amounts retained in: (i) any accounts in existence at the Bank on   the Effective Date; or (ii) any other Retained Earnings accounts subject to restrictions that are not part of the   terms of the Retained Earnings Capital Plan Amendment.    “Restricted Retained Earnings Minimum” (“RREM”) means a level of Restricted Retained Earnings calculated as   of the last day of each calendar quarter equal to one percent of the Bank’s Total Consolidated Obligations.                                                                                     12          

 

                                                                                                   “Restriction Termination Date” means the date the restriction on the Bank paying Dividends out of the Restricted        Retained Earnings account, or otherwise reallocating funds from the Restricted Retained Earnings account, is        terminated permanently. That date is determined pursuant to section 10 of this Capital Plan.         “Retained Earnings” means the retained earnings of an FHLBank calculated pursuant to GAAP.         “Retained Earnings Capital Plan Amendment” means the amendment to this Capital Plan, made a part thereof,        adopted effective on the Interim Capital Plan Amendment Implementation Date adding sections 7 through 10 to        this Capital Plan.         “Special Contribution Amount” means the result of: (i) 50 percent of Quarterly Net Income; plus (ii) 50 percent of        a positive Adjustment to Prior Net Income for any prior calendar quarter that includes the REFCORP Termination        Date, or occurred subsequent to the REFCORP Termination Date, to the extent such adjustment has not yet been        made in the current calendar quarter; minus (iii) 50 percent of the absolute value of a negative Adjustment to Prior        Net Income for any prior calendar quarter that includes the REFCORP Termination Date, or occurred subsequent        to the REFCORP Termination Date, to the extent such adjustment has not yet been made by the current calendar        quarter.         “Stockholder” means: (i) a Member; (ii) a former Member that continues to own Capital Stock; or (iii) a successor        to an entity that was a Member that continues to own Capital Stock.         “System Consolidated Obligation” means any bond, debenture, or note authorized under the Regulations to be        issued jointly by the FHLBanks pursuant to Section 11(a) of the Act, as amended, or any bond or note previously        issued by the Federal Housing Finance Agency on behalf of all FHLBanks pursuant to Section 11(c) of the Act,       on which the FHLBanks are jointly and severally liable, or any other instrument issued through the Office of       Finance, or any successor thereto, under the Act, that is a joint and several liability of all the FHLBanks.         “Total Capital” means Retained Earnings, the amount paid-in for Capital Stock, the amount of any Additional        Capital, the amount of any general allowance for losses, and the amount of other instruments that the FHFA has       determined to be available to absorb losses incurred by the Bank.   8.    Establishment of Restricted Retained Earnings         8.1   Segregation of Account          No later than the REFCORP Termination Date, the Bank shall establish an account in its official books and        records in which to allocate its Restricted Retained Earnings, with such account being segregated on its books and        records from the Bank’s Retained Earnings that are not Restricted Retained Earnings for purposes of tracking the        accumulation of Restricted Retained Earnings and enforcing the restrictions on the use of the Restricted Retained        Earnings imposed in the Retained Earnings Capital Plan Amendment.         8.2   Funding of Account               8.2.1 Date on which Allocation Begins               The Bank shall allocate to its Restricted Retained Earnings account an amount at least equal to the              Regular Contribution Amount beginning on the REFCORP Termination Date. The Bank shall allocate              amounts to the Restricted Retained Earnings account only through contributions from its Quarterly Net              Income or Adjustments to Prior Net Income occurring on or after the REFCORP Termination Date, but              nothing in the Retained Earnings Capital Plan Amendment shall prevent the Bank from allocating a                                                                                              13          

 

                                                                                  greater percentage of its Quarterly Net Income or positive Adjustment to Prior Net Income to its  Restricted Retained Earnings account than the percentages set forth in the Retained Earning Capital Plan  Amendment.   8.2.2 Ongoing Allocation   During any Dividend Restriction Period that occurs before the Allocation Termination Date, the Bank  shall continue to allocate its Regular Contribution Amount (or when and if required under subsection  8.2.4 below, its Special Contribution Amount) to its Restricted Retained Earnings account.   8.2.3 Treatment of Quarterly Net Losses and Annual Net Losses   In the event the Bank sustains a Net Loss for a calendar quarter, the following shall apply: (i) to the extent  that its cumulative calendar year-to-date net income is positive at the end of such quarter, the Bank may  decrease the amount of its Restricted Retained Earnings such that the cumulative addition to the  Restricted Retained Earnings account calendar year-to-date at the end of such quarter is equal to 20  percent of the amount of such cumulative calendar year-to-date net income; (ii) to the extent that its  cumulative calendar year-to-date net income is negative at the end of such quarter (a) the Bank may  decrease the amount of its Restricted Retained Earnings account such that the cumulative addition  calendar year-to-date to the Restricted Retained Earnings at the end of such quarter is zero, and (b) the  Bank shall apply any remaining portion of the Net Loss for the calendar quarter first to reduce Retained  Earnings that are not Restricted Retained Earnings until such Retained Earnings are reduced to zero, and  thereafter may apply any remaining portion of the Net Loss for the calendar quarter to reduce Restricted  Retained Earnings; and (iii) for any subsequent calendar quarter in the same calendar year, the Bank may  decrease the amount of its quarterly allocation to its Restricted Retained Earnings account in that  subsequent calendar quarter such that the cumulative addition to the Restricted Retained Earnings account  calendar year-to-date is equal to 20 percent of the amount of such cumulative calendar year-to-date net  income.   In the event the Bank sustains a Net Loss for a calendar year, any such Net Loss first shall be applied to  reduce Retained Earnings that are not Restricted Retained Earnings until such Retained Earnings are  reduced to zero, and thereafter any remaining portion of the Net Loss for the calendar year may be  applied to reduce Restricted Retained Earnings.   8.2.4 Funding at the Special Contribution Amount   If during a Dividend Restriction Period, the amount of the Bank’s Restricted Retained Earnings decreases  in any calendar quarter, except as provided in subsections 8.2.3(i) and (ii)(a) above, the Bank shall  allocate the Special Contribution Amount to its Restricted Retained Earnings account beginning at the  following calendar quarter-end (except as provided in the last sentence of this subsection). Thereafter, the  Bank shall continue to allocate the Special Contribution Amount to its Restricted Retained Earnings  account until the cumulative difference between: (i) the allocations made using the Special Contribution  Amount; and (ii) the allocations that would have been made if the Regular Contribution Amount applied,  is equal to the amount of the prior decrease in the amount of its Restricted Retained Earnings account  arising from the application of subsection 8.2.3(ii)(b). If at any calendar quarter-end the allocation of the  Special Contribution Amount would result in a cumulative allocation in excess of such prior decrease in  the amount of Restricted Retained Earnings: (i) the Bank may allocate such percentage of Quarterly Net  Income to the Restricted Retained Earnings account that shall exactly restore the amount of the prior  decrease, plus the amount of the Regular Contribution Amount for that quarter; and (ii) the Bank in  subsequent quarters shall revert to paying at least the Regular Contribution Amount.                                                                       14          

 

                                                                                                        8.2.5 Release of Restricted Retained Earnings              If the Bank’s RREM decreases from time to time due to fluctuations in the Bank’s Total Consolidated             Obligations, amounts in the Restricted Retained Earnings account in excess of 150 percent of the RREM             may be released by the Bank from the restrictions otherwise imposed on such amounts pursuant to the             provisions of the Retained Earnings Capital Plan Amendment, and reallocated to its Retained Earnings             that are not Restricted Retained Earnings. Until the Restriction Termination Date, the Bank may not             otherwise reallocate amounts in its Restricted Retained Earnings account (provided that a reduction in the             Restricted Retained Earnings account following a Net Loss pursuant to subsection 8.2.3 is not a             reallocation).              8.2.6 No Effect on Rights of Shareholders as Owners of Retained Earnings               In the event of the liquidation of the Bank, or a taking of the Bank’s Retained Earnings by any future              federal action, nothing in the Retained Earnings Capital Plan Amendment shall change the rights of the              holders of the Bank’s Class B stock that confer ownership of Retained Earnings, including Restricted              Retained Earnings, as granted under Section 6(h) of the Act.                  9.    Limitation on Dividends, Stock Purchase and Stock Redemption         9.1    General Rule on Dividends         From the REFCORP Termination Date through the Restriction Termination Date, the Bank may not pay        Dividends, or otherwise reallocate funds (except as expressly provided in subsection 8.2.5, and further provided        that a reduction in the Restricted Retained Earnings account following a Net Loss pursuant to subsection 8.2.3 is        not a reallocation), out of Restricted Retained Earnings. During a Dividend Restriction Period, the Bank may not        pay Dividends out of the amount of Quarterly Net Income required to be allocated to Restricted Retained        Earnings.         9.2   Limitations on Repurchase and Redemption         From the REFCORP Termination Date through the Restriction Termination Date, the Bank shall not engage in a        repurchase or redemption transaction if following such transaction the Bank’s Total Capital as reported to the        FHFA falls below the Bank’s aggregate paid-in amount of Capital Stock.   10.   Termination of Retained Earnings Capital Plan Amendment Obligations         10.1  Notice of Automatic Termination Event               10.1.1 Action by FHLBanks               If the Bank desires to assert that an Automatic Termination Event has occurred (or will occur on the              effective date of a change in a statute or the Regulations), the Bank shall provide prompt written notice to              all of the other FHLBanks (and provide a copy to the FHFA) identifying the specific statutory or              regulatory change that is the basis for the assertion. For the purposes of this section, “prompt written              notice” means notice delivered no later than 90 calendar days subsequent to: (1) the date the specific              statutory change takes effect; or (2) the date an interim final rule or final rule effecting the specific              regulatory change is published in the Federal Register.                                                                                              15          

 

                                                                                  If within 60 calendar days of transmission of such written notice to all of the other FHLBanks, at least 2/3  of the then existing FHLBanks (including the Bank)execute a Declaration of Automatic Termination  concurring that the specific statutory or regulatory change identified in the written notice constitutes an  Automatic Termination Event, then the Declaration of Automatic Termination shall be delivered by the  Bank to the FHFA within 10 calendar days of the date that the Declaration of Automatic Termination is  executed. After the expiration of a 60 calendar day period that begins when the Declaration of Automatic  Termination is delivered to the FHFA, or is delivered to the FHFA by another FHLBank pursuant to the  terms of its capital plan, an Automatic Termination Event Declaration Date shall be deemed to occur  (except as provided in subsection 10.1.3).   If a Declaration of Automatic Termination concurring that the specific statutory or regulatory change  identified in the written notice constitutes an Automatic Termination Event has not been executed by at  least the required 2/3 of the then existing FHLBanks within 60 calendar days of transmission of such  notice to all of the other FHLBanks, the Bank may request a determination from the FHFA that the  specific statutory or regulatory change constitutes an Automatic Termination Event. Such request must be  filed with the FHFA within 10 calendar days after the expiration of the 60 calendar day period that begins  upon transmission of the written notice of the basis of the assertion to all of the other FHLBanks.   10.1.2 Action by FHFA   The Bank may request a determination from the FHFA that a specific statutory or regulatory change  constitutes an Automatic Termination Event, and may claim that an Automatic Termination Event has  occurred, or will occur, with respect to a specific statutory or regulatory change only if the Bank has  complied with the time limitations and procedures of subsection 10.1.1.   If within 60 calendar days after the Bank delivers such a request to the FHFA, or another FHLBank  delivers such a request pursuant to its capital plan, the FHFA provides the requesting FHLBank with a  written determination that a specific statutory or regulatory change is an Automatic Termination Event,  then an Automatic Termination Event Declaration Date shall be deemed to occur as of the expiration of  such 60 calendar day period (except as provided in subsection 10.1.3). The date of the Automatic  Termination Event Declaration Date shall be as of the expiration of such 60 calendar day period (except  as provided in subsection 10.1.3) no matter on which day prior to the expiration of the 60 calendar day  period the FHFA has provided its written determination.   If the FHFA fails to make a determination within 60 calendar days after an FHLBank delivers such a  request to the FHFA, then an Automatic Termination Event Declaration Date shall be deemed to occur as  of the date of the expiration of such 60 calendar day period (except as provided in subsection 10.1.3);  provided, however, that the FHFA may make a written request for information from the requesting  FHLBank, and toll such 60 calendar day period from the date that the FHFA transmits its request until  that FHLBank delivers to the FHFA information responsive to its request.   If within 60 calendar days after an FHLBank delivers to the FHFA a request for determination that a  specific statutory or regulatory change constitutes an Automatic Termination Event (or such longer period  if the 60 calendar day period is tolled pursuant to the preceding sentence), the FHFA provides that  FHLBank with a written determination that a specific statutory or regulatory change is not an Automatic  Termination Event, then an Automatic Termination Event shall not have occurred with respect to such  change.   10.1.3 Proviso as to Occurrence of Automatic Termination Event Declaration Date                                                                        16          

 

                                                                                            In no case under this subsection 10.1 may an Automatic Termination Event Declaration Date be deemed       to occur prior to: (1) the date the specific statutory change takes effect; or (2) the date an interim final rule       or final rule effecting the specific regulatory change is published in the Federal Register.   10.2  Notice of Voluntary Termination    If the FHLBanks terminate the Agreement, then the FHLBanks shall provide written notice to the FHFA that the  FHLBanks have voted to terminate the Agreement.   10.3  Consequences of an Automatic Termination Event or Vote to Terminate the Agreement         10.3.1 Consequences of Voluntary Termination         In the event the FHLBanks deliver written notice to the FHFA that the FHLBanks have voted to terminate        the Agreement, then without any further action by the Bank or the FHFA: (i) the date of delivery of such        notice shall be an Allocation Termination Date; and (ii) one year from the date of delivery of such notice        shall be a Restriction Termination Date.         10.3.2 Consequences of an Automatic Termination Event Declaration Date         If an Automatic Termination Event Declaration Date has occurred, then without further action by the        Bank or the FHFA: (i) the date of the Automatic Termination Event Declaration Date shall be an        Allocation Termination Date; and (ii) one year from the date of the Automatic Termination Event        Declaration Date shall be a Restriction Termination Date.         10.3.3 Deletion of Operative Provisions of Retained Earnings Capital Plan Amendment         Without any further action by the Bank or the FHFA, on the Restriction Termination Date, sections 7        through 10 of this Capital Plan shall be deleted.                                                                                   17          

 

                                                   Appendix I   Membership Stock Requirement    Each Member is required to purchase and maintain Membership Stock equal to the following:                                                                                        1                                  Membership Stock          Minimum Investment Range                                     Requirement2              Minimum           Maximum   % of Total Assets               0.12%                     0.05%             0.25%   Membership Stock Cap            $10 million               $1 million        $30 million   Membership Stock Floor          $10,000                   $10,000           $30,000    Activity Based Stock Requirement    Each Member is required to purchase and maintain Activity Based Stock issued in accordance with section 2.5 of this  Capital Plan equal to the percentage of the book value on the Bank’s books and records of the following transactions as  shown in the table below.                                                                          Minimum Investment Range1  Transaction                         Activity Based Stock Requirement2 Minimum       Maximum   Outstanding Advances               4.00%5                            2.00%         5.00%    Outstanding Acquired Member Assets3 4.00%5                          0.00%         5.00%   Outstanding Letters of Credit6     0.10%                             0.00%         0.175%   Advance Commitments                0.00%                             0.00%         0.35%   Acquired Member Asset Commitments  0.00%                             0.00%         0.60%    Operational Threshold    Each Member is permitted to retain Excess Shares of Activity Based Stock in an amount not to exceed the following  operational threshold, designed to minimize the number of repurchase transactions for the Bank and its Members.                                                                   Operational Threshold Range1                            Current Operational Threshold2       Minimum          Maximum   Operational Threshold    $04                                  $0               $250,000         1   Changes to the Minimum Investment and operational threshold ranges constitute amendments to the Capital Plan and requires      approval by the Finance Agency.        2   The Board of Directors reviews and adjusts the Membership Stock Requirement, Activity Based Stock Requirement and the      Current Operational Threshold within the established ranges, subject to the Member notification requirements in section 2.3.         3   Any Acquired Member Assets held by the Bank as of July 1, 2003 shall be subject to capital requirements specified in contracts in      effect at the time the assets were purchased in lieu of the initial Activity Based Stock Requirement.  4   Board of Directors approved change to current Operational Threshold for Excess Shares of Activity Based Stock effective      January 4, 2012.        5   Board of Directors approved change to Activity Based Stock Requirement for Acquired Member Assets from 4.45% to 4.00%      effective August 1, 2013.  6   Board of Directors approved change to Activity Based Stock Requirement for Letters of Credit from 0.00% to 0.10% effective      October 1, 2020.Exhibit 10.1

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INTEREST PURCHASE AGREEMENT BETWEEN
BCI IV PORTFOLIO REAL ESTATE HOLDCO LLC
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AND
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INDUSTRIAL PROPERTY OPERATING PARTNERSHIP LP
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DATED AS OF JULY 15, 2020
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TABLE OF CONTENTS
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	Page

	ARTICLE 1 DEFINITIONS
	2

	Section 1.1
	Definitions
	2

	Section 1.2
	Interpretation and Rules of Construction
	9

	ARTICLE 2 PURCHASE AND SALE; CLOSING
	10

	Section 2.2
	Sale and Purchase of the IPT Holdco Interests
	10

	Section 2.2
	Closing
	10

	Section 2.3
	Closing Deliveries
	10

	Section 2.4
	Purchase Price
	11

	Section 2.5
	Withdrawal and Substitution
	11

	Section 2.6
	Transfer Taxes
	11

	Section 2.7
	REIT Status of the BTC REITs
	12

	ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF COMPANY OP
	12

	Section 3.1
	Organization and Qualification
	12

	Section 3.2
	Organizational Documents
	12

	Section 3.3
	Capital Structure
	13

	Section 3.4
	Authority
	14

	Section 3.5
	No Conflict; Required Filings and Consents
	15

	Section 3.6
	Permits; Compliance with Law
	15

	Section 3.7
	Financial Statements; No Undisclosed Material Liabilities
	16

	Section 3.8
	No Default
	17

	Section 3.9
	Litigation
	17

	Section 3.10
	Taxes
	17

	Section 3.11
	Benefit Plans; Employees
	19

	Section 3.12
	Intellectual Property
	19

	Section 3.13
	Environmental Matters
	20

	Section 3.14
	Properties
	20

	Section 3.15
	Material Contracts
	23

	Section 3.16
	Insurance
	23

	Section 3.17
	Brokers
	23

	Section 3.18
	Related-Party Transactions
	24

	Section 3.19
	Investment Company Act
	24

	Section 3.20
	No Other Representations and Warranties
	24

	ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF BCI IV HOLDCO
	24

	Section 4.1
	Organization and Qualification
	24

	Section 4.2
	Authority
	24

	Section 4.3
	No Conflict; Required Filings and Consents
	25

	Section 4.4
	Investment Representation
	26

	Section 4.5
	Taxes
	26

	ARTICLE 5 GENERAL PROVISIONS
	26

	Section 5.1
	Nonsurvival of Representations, Warranties, Covenants and Agreements
	26

	Section 5.2
	Public Announcements
	26

	Section 5.3
	Notices
	27

	Section 5.4
	Severability
	28

	Section 5.5
	Counterparts
	28

	Section 5.6
	Entire Agreement; No Third-Party Beneficiaries
	28

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	Section 5.7
	Amendment
	29

	Section 5.8
	Governing Law
	29

	Section 5.9
	Consent to Jurisdiction
	29

	Section 5.10
	Assignment
	30

	Section 5.11
	Remedies
	30

	Section 5.12
	Waiver of Jury Trial
	30

	Section 5.13
	Authorship
	30

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INTEREST PURCHASE AGREEMENT
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This INTEREST PURCHASE AGREEMENT, dated as of July 15, 2020 (this “Agreement”), is by and between BCI IV Portfolio Real Estate Holdco LLC (“BCI IV Holdco”), a Delaware limited liability company and an indirect subsidiary of Black Creek Industrial REIT IV Inc., a Maryland corporation (“BCI IV”), and Industrial Property Operating Partnership LP (“Company OP”), a Delaware limited partnership and a direct subsidiary of Industrial Property Trust, a Maryland real estate investment trust (the “Company). Each of BCI IV Holdco and Company OP is sometimes referred to herein as a “Party” and collectively as the “Parties.” Capitalized terms used but not otherwise defined herein have the meanings ascribed to them in Article 1.
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WHEREAS, upon the terms and subject to the conditions set forth in this Agreement, Company OP desires to sell, and BCI IV Holdco desires to purchase, all of Company OP’s ownership interests (the “IPT Holdco Interests”) in IPT Real Estate Holdco LLC, a Delaware limited liability company and wholly owned subsidiary of Company OP (“IPT Holdco”) (such transaction, the “Interest Sale”);
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WHEREAS, substantially all of the assets of IPT Holdco consists of general and limited partner interests in Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP;
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WHEREAS, the Board of Trustees of the Company (the “Company Board”) has established a special committee consisting solely of independent trustees (the “Company Special Committee”) to, among other things, evaluate and, if desirable, negotiate a potential transaction with BCI IV or one or more of its subsidiaries with respect to the IPT Holdco Interests;
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WHEREAS, the Board of Directors of BCI IV (the “BCI IV Board”) has established a special committee consisting solely of independent directors (the “BCI IV Special Committee”) to, among other things, evaluate and, if desirable, negotiate a potential transaction with the Company or one or more of its subsidiaries with respect to the IPT Holdco Interests;
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WHEREAS, the Company Board, following the unanimous approval and recommendation of the Company Special Committee, has (i) on behalf of the Company, (a) determined that the sale of the Company’s indirect interests in IPT Holdco (including its indirect interests in Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP) pursuant to the Interest Sale and the other transactions contemplated by the Interest Purchase Agreement are advisable and in the best interests of Company and its shareholders, (b) determined that the sale of the Company’s indirect interests IPT Holdco (including its indirect in interests in Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP) pursuant to the Interest Sale and the other transactions contemplated by the Interest Purchase Agreement are fair and reasonable to the Company and on terms and conditions no less favorable to the Company than those available from an unaffiliated third party and (c) authorized and approved the sale of the Company’s indirect interests in IPT Holdco (including its indirect interests in Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership
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II LP) pursuant to the Interest Sale and the other transactions contemplated by the Interest Purchase Agreement, and (ii) on behalf of the Company in its capacity as the sole general partner of Company OP, on behalf of Company OP, (a) determined that the Interest Sale and other transactions contemplated by the Interest Purchase Agreement are advisable and in the best interests of Company OP and its partners and (b) authorized, approved and adopted the Interest Purchase Agreement and authorized and approved the negotiation, execution, delivery and performance by Company OP of the Interest Purchase Agreement and consummation of each of the transactions contemplated thereby (including, without limitation, the Interest Sale);
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WHEREAS, the BCI IV Board, following the unanimous approval and recommendation of the BCI IV Special Committee, has (i) determined that (a) this Agreement, the Interest Sale and the other transactions contemplated by this Agreement are advisable and in the best interests of BCI IV and are fair and reasonable to BCI IV, (b) there is substantial justification for the amount by which the Purchase Price exceeds the amount that Company OP invested in IPT Holdco and that the Purchase Price is reasonable, and (c) the joint venture terms of Build-To- Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP are fair and reasonable to BCI IV and on terms and conditions that are no less favorable than those that would be available to unaffiliated parties, and (ii) approved this Agreement, the Interest Sale and the other transactions contemplated by this Agreement and authorized BCI IV, in its capacity as the sole general partner of BCI IV Operating Partnership LP, a Delaware limited partnership (“BCI IV OP”), on behalf of BCI IV OP, in its capacity as the sole member of BCI IV Holdco, on behalf of BCI IV Holdco, to execute, deliver and perform the Purchase Agreement;
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WHEREAS, for U.S. federal income tax purposes, it is intended that the Interest Sale will be treated as a taxable sale of all of the IPT Holdco Interests by Company OP to BCI IV Holdco; and
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WHEREAS, the Parties desire to make certain representations, warranties, covenants and agreements in connection with the execution of this Agreement.
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NOW THEREFORE, in consideration of the foregoing and the mutual representations, warranties, covenants and agreements contained in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties, intending to be legally bound, agree as follows:
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ARTICLE 1 
DEFINITIONS
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Section 1.1Definitions.
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(a)For purposes of this Agreement:
​
“Action” means any claim, action, cause of action, suit, litigation, proceeding, arbitration, mediation, interference, audit, assessment, hearing or other legal proceeding (whether sounding in contract, tort or otherwise, whether civil or criminal) brought, conducted, tried or heard by or before, or otherwise involving, any Governmental Authority.
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“Affiliate” of a specified Person means a Person that directly or indirectly, through one or more intermediaries, controls, is controlled by, or is under common control with, such specified Person. For the avoidance of doubt, for purposes of this Agreement, Company, Company OP  and their subsidiaries shall not be deemed to be Affiliates of BCI IV, BCI IV OP, BCI IV Holdco and their subsidiaries.
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“Benefit Plan” means any “employee benefit plan” (within the meaning of Section 3(3) of ERISA) and any employment, consulting, termination, severance, change in control, separation, stock option, restricted stock, profits interest unit, performance award, outperformance, stock purchase, stock or stock-related awards, deferred compensation, bonus, incentive compensation, fringe benefit, health, medical, dental, disability, accident, life insurance, welfare benefit, cafeteria, vacation, sick or paid time off, perquisite, retirement, profit sharing, pension, or savings or any other remuneration, compensation or employee benefit plan, agreement, program, policy or other arrangement of any kind, whether or not subject to ERISA and whether written or unwritten, or funded or unfunded.
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“BCI IV Material Adverse Effect” means any Event that would reasonably be expected to prevent or materially impair or delay the ability of BCI IV Holdco to perform its material obligations hereunder or to consummate any of the transactions contemplated by this Agreement.
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“BTC Entities” means (i) Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP, and (ii) each of the direct and indirect subsidiaries of the entities set forth in clause (i) of this definition of “BTC Entities.” For the avoidance of doubt, the BTC REITs are included in BTC Entities.
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“BTC REITs” means BTC I REIT A LLC, a Delaware limited liability company, BTC I REIT B LLC, a Delaware limited liability company, and BTC II Holdco LLC, a Delaware limited liability company.
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“Business Day” means any day other than a Saturday, Sunday or any day on which banks located in New York, New York or Denver, Colorado are authorized or required to be closed.
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“Code” means the Internal Revenue Code of 1986, as amended.
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“Company Leases” means each lease or sublease (including any ground lease) that (i) was in effect as of the date hereof and (ii) to which any IPT Holdco Subsidiary is a party as lessor or sublessor with respect to any Company Property (together with all amendments, modifications, supplements, renewals, exercise of options and extensions related thereto).
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“Company Material Adverse Effect” means any Event that (i) is material and adverse to the business, assets, liabilities, condition (financial or otherwise) or results of operations of the IPT Holdco Subsidiaries, taken as a whole, or (ii) will prevent or materially impair or delay the ability of Company OP to consummate the Interest Sale or any of the transactions contemplated by this Agreement; provided that for purposes of clause (i) “Company Material Adverse Effect” shall not include any Event to the extent arising out of or resulting from (A) any failure of any IPT Holdco Subsidiary to meet any projections or forecasts or any estimates of earnings, revenues or other metrics for any period (provided that any Event giving rise to such failure may
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be taken into account in determining whether there has been a Company Material Adverse Effect), (B) any changes that affect the real estate industry generally, (C) any changes in the United States or global economy or capital, financial or securities markets generally, including changes in interest or exchange rates, (D) any changes in the legal, regulatory or political conditions in the United States or in any other country or region of the world, (E) the commencement, escalation or worsening of a war or armed hostilities or the occurrence of acts of terrorism or sabotage, (F) the negotiation, execution, or delivery of this Agreement, or performance in accordance with the terms of this Agreement, or the public announcement of the Interest Sale or the other transactions contemplated hereby, including the impact thereof on relationships, contractual or otherwise, with tenants, suppliers, lenders, investors (including stockholders), venture partners or employees, (G) earthquakes, hurricanes, floods or other natural disasters, (H) changes in Law or GAAP (or the interpretation or enforcement thereof), or (I) any Action, made or initiated by any holder of common stock of the Company, including any derivative claims, arising out of or relating to this Agreement or the transactions contemplated hereby, which in the case of each of clauses (B), (C), (D), (E) and (H) do not disproportionately affect the IPT Holdco Subsidiaries, taken as a whole, relative to other Persons in the industrial real estate industry in the United States, and in the case of clause (G), do not disproportionately affect the IPT Holdco Subsidiaries, taken as a whole, relative to other Persons in the real estate industry in the geographic regions in which the IPT Holdco Subsidiaries operate, own or lease properties.
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“Company Material Contract” means any contract (other than contracts that (x) are terminable upon not more than thirty (30) days’ notice without a penalty or premium, or (y) are among IPT Holdco Subsidiaries) to which any IPT Holdco Subsidiary is a party to or bound by that, as of the date hereof:
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(i)obligates any IPT Holdco Subsidiary to make non-contingent aggregate annual expenditures (other than principal or interest payments or the deposit of other reserves with respect to debt obligations) in excess of $5,000,000, except for any Company Lease or any ground lease pursuant to which any third party is a lessee or sublessee on any Company Property;
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(ii)contains any non-compete, non-solicit or exclusivity provisions with respect to any line of business or geographic area that restricts the business of any IPT Holdco Subsidiary, or that otherwise restricts the lines of business conducted by any IPT Holdco Subsidiary or the geographic area in which any IPT Holdco Subsidiary may conduct business;
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(iii)is an agreement (other than the organizational documents of any IPT Holdco Subsidiary) that obligates any IPT Holdco Subsidiary to indemnify any past or present directors, officers, trustees, employees and agents of any IPT Holdco Subsidiary pursuant to which a IPT Holdco Subsidiary is the indemnitor;
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(iv)constitutes an Indebtedness obligation of any IPT Holdco Subsidiary with a principal amount as of the date hereof greater than $5,000,000;
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(v)requires any IPT Holdco Subsidiary to dispose of or acquire assets or properties (other than in connection with the expiration of a Company Lease or a ground lease pursuant to which any third party is a lessee or sublessee on any Company Property) with a fair market value in excess of $5,000,000, or involves any pending or contemplated merger, consolidation or similar business combination transaction, except for any Company Lease or any ground lease pursuant to which any third party is a lessee or sublessee on any Company Property;
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(vi)constitutes an interest rate cap, interest rate collar, interest rate swap or other contract or agreement relating to a hedging transaction;
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(vii)constitutes a joint venture, partnership or limited liability company or strategic alliance agreement between any IPT Holdco Subsidiary, on the one hand, and any third party, on the other hand; or
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(viii)constitutes a loan to any Person (other than a wholly owned subsidiary of IPT Holdco) by any IPT Holdco Subsidiary (other than advances or rent relief made in connection with or pursuant to and expressly disclosed in the Company Leases or pursuant to any disbursement agreement, development agreement, or development addendum entered into in connection with a Company Lease with respect to the development, construction, or equipping of Company Properties or the funding of improvements to Company Properties) in an amount in excess of $5,000,000.
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For the avoidance of doubt, the term “Company Material Contract” does not include any Company Leases.
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“Company Partnership Agreement” means that certain Third Amended and Restated Limited Partnership Agreement of Company OP, dated as of February 3, 2020, as such agreement may be amended from to time.
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“Company Permitted Liens” means any of the following: (i) Liens for Taxes or governmental assessments, charges or claims of payment not yet due, that are being contested in good faith or for which adequate accruals or reserves have been established; (ii) Liens that are a cashier’s, landlord’s, carriers’, warehousemen’s, mechanics’, materialmen’s, repairmen’s or other similar Liens arising in the ordinary course of business; (iii) Liens that are a zoning regulation, entitlement or other land use or environmental regulation by any Governmental Authority; (iv) Liens that are disclosed on the most recent consolidated balance sheet of the Company or notes thereto (or securing liabilities reflected on such balance sheet); (v) Liens arising under any Company Material Contracts, or leases to third parties for the occupation of portions of Company Properties as tenants only by such third parties in the ordinary course of the business of any IPT Holdco Subsidiary; (vi) non-monetary Liens that are recorded in a public record or disclosed on existing title policies or surveys; or (vii) non-monetary Liens, limitations, title defects, covenants, restrictions or reservations of interests in title that are disclosed on existing title policies or do not interfere materially with the current use of the property affected thereby (assuming its continued use in the manner in which it is currently used) or materially adversely affect the value or marketability of such property.
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“Company Properties” means each real property owned, or leased (including ground leased) as lessee or sublessee, in whole or in part, by any IPT Holdco Subsidiary as of the date hereof (including all buildings, structures and other improvements and fixtures located on or under such real property and all easements, rights and other appurtenances to such real property).
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“DSOS” means the Secretary of State of the State of Delaware.
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“Event” means an effect, event, change, development, circumstance, condition or occurrence.
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“Environmental Law” means any Law (including common law) relating to the pollution or protection of the environment (including air, surface water, groundwater, land surface or subsurface land), or human health or safety (solely as such matters relate to Hazardous Substances), including Laws relating to the use, handling, presence, transportation, treatment, storage, disposal, release or discharge of Hazardous Substances.
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“Environmental Permit” means any permit, approval, license or other authorization required under any applicable Environmental Law.
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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended.
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“ERISA Affiliate” means, with respect to an entity (the “Referenced Entity”), any other entity, which, together with such Referenced Entity, would be treated as a single employer under Code Section 414 or ERISA Section 4001.
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“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder.
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“GAAP” means the United States generally accepted accounting principles.
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“Governmental Authority” means the United States (federal, state or local) government or any foreign government, or any other governmental or quasi-governmental regulatory, judicial or administrative authority, instrumentality, board, bureau, agency, commission, self-regulatory organization, arbitration panel or similar entity.
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“Hazardous Substances” means (i) any “hazardous substance” as that term is defined under the Comprehensive Environmental Response, Compensation and Liability Act, (ii) any “hazardous waste” as that term is defined under the Resource Conservation and Recovery Act, and (iii) petroleum and petroleum products, including crude oil and any fractions thereof, polychlorinated biphenyls, asbestos and radon.
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“Indebtedness” means, with respect to any Person and without duplication, (i) the principal of and premium (if any) of all indebtedness, notes payable, accrued interest payable or other obligations for borrowed money, whether secured or unsecured, (ii) all obligations under conditional sale or other title retention agreements, or incurred as financing, in either case with respect to property acquired by such Person, (iii) all obligations issued, undertaken or assumed as the deferred purchase price for any property or assets, (iv) all obligations under capital leases, (v)
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all obligations in respect of bankers acceptances or letters of credit, (vi) all obligations under interest rate cap, swap, collar or similar transaction or currency hedging transactions, (vii) any guarantee of any of the foregoing, whether or not evidenced by a note, mortgage, bond, indenture or similar instrument, and (viii) any agreement to provide any of the foregoing; provided that for purposes of clarity, “Indebtedness” shall not include trade payables. For purposes of clauses (i) and (vi) of this definition of “Indebtedness”, such obligations shall be valued at the termination value thereof.
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“Intellectual Property” means all United States and foreign (i) patents, patent applications, invention disclosures, and all related continuations, continuations-in-part, divisionals, reissues, re-examinations, substitutions and extensions thereof, (ii) trademarks, service marks, trade dress, logos, trade names, corporate names, Internet domain names, design rights and other source identifiers, together with the goodwill symbolized by any of the foregoing, (iii) registered and unregistered copyrights, copyrightable works and database rights,
(iv) confidential and proprietary information, including trade secrets, know-how, ideas, formulae, models, algorithms and methodologies, (v) all rights in the foregoing and in other similar intangible assets, and (vi) all applications and registrations for the foregoing.
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“Investment Company Act” means the Investment Company Act of 1940, as amended.
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“IPT Holdco Subsidiary” means IPT Holdco and any corporation, partnership, limited liability company, joint venture, business trust, real estate investment trust or other organization, whether incorporated or unincorporated, or other legal entity of which (i) IPT Holdco directly or indirectly owns or controls at least a majority of the capital stock or other equity interests having by their terms ordinary voting power to elect a majority of the board of directors or others performing similar functions, (ii) IPT Holdco or any Person that is an IPT Holdco Subsidiary by reason of the application of clause (i) or clause (iii) of this definition of “IPT Holdco Subsidiary” is a general partner, manager, managing member, operating member, trustee, director or the equivalent, or (iii) IPT Holdco, directly or indirectly, holds a majority of the beneficial, equity, capital, profits or other economic interest. For the avoidance of doubt, the term IPT Holdco Subsidiary shall include IPT BTC I LP LLC, IPT BTC I GP LLC, IPT BTC II LP LLC, IPT BTC II GP LLC and the BTC Entities.
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“IRS” means the United States Internal Revenue Service or any successor agency.
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“Knowledge” or “Knowledge of Company OP” means the actual knowledge of the persons named in Section 1.1 of the Company Disclosure Letter.
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“Law” means any and all domestic (federal, state or local) or foreign laws, rules, regulations and Orders promulgated by any Governmental Authority.
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“Lien” means, with respect to any asset (including any security), any mortgage, deed of trust, condition, covenant, lien, pledge, charge, security interest, option or other third party right (including right of first refusal or first offer), restriction, right of way, easement, or title defect or encumbrance of any kind in respect of such asset, including any restriction on the use, voting, transfer, receipt of income or other exercise of any attributes of ownership.
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“Material Company Lease” means all (i) ground leases under which the interest of a IPT Holdco Subsidiary in Company Properties is a leasehold interest, and (ii) Company Leases with annual rent in excess of $500,000.
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“Order” means a judgment, writ, order, injunction or decree of any Governmental Authority.
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“Person” means an individual, corporation, partnership, limited partnership, limited liability company, person (including a “person” as defined in Section 13(d)(3) of the Exchange Act), trust, association or other entity or organization (including any Governmental Authority or a political subdivision, agency or instrumentality of a Governmental Authority).
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“Property Permit” means any certificate, variance, permit, approval, license or other authorization required from any Governmental Authority having jurisdiction over the applicable Company Property.
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“REIT” means a real estate investment trust within the meaning of Section 856 of the
Code.
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“Representative” means, with respect to any Person, one or more of such Person’s directors, officers, trustees, members, managers, partners, employees, advisors (including attorneys, accountants, consultants, investment bankers, and financial advisors), agents and other representatives.
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“SEC” means the U.S. Securities and Exchange Commission (including the staff thereof).
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“Securities Act” means the U.S. Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder.
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“Tax” or “Taxes” means any federal, state, local and foreign income, gross receipts, capital gains, withholding, property, recording, stamp, transfer, sales, use, abandoned property, escheat, franchise, employment, payroll, excise, environmental and any other taxes, duties, assessments or similar governmental charges, together with penalties, interest or additions imposed with respect to such amounts, in each case, imposed by and payable to any Governmental Authority.
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“Tax Return” means any return, declaration, report, claim for refund, or information return or statement relating to Taxes filed or required to be filed with a Governmental Authority, including any schedule or attachment thereto, and including any amendment thereof.
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(b)The following terms have the respective meanings set forth in the sections set forth below opposite such term:
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	Defined Terms
	Location of Definition

	Agreement
	Preamble

	BCI IV
	Recitals

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	Defined Terms
	Location of Definition

	BCI IV Board
	Recitals

	BCI IV Holdco
	Preamble

	BCI IV OP
	Recitals

	BCI IV Special Committee
	Recitals

	Company
	Preamble

	Company Board
	Recitals

	Company OP
	Preamble

	Company Permits
	Section 3.4(a)

	Company Special Committee
	Recitals

	Company Third Party
	Section 3.14(d)

	Company Title Insurance Policy
	Section 3.14(f)

	Closing
	Section 2.1

	Closing Date
	Section 2.2

	Interest Sale
	Recitals

	IPT Holdco
	Recitals

	IPT Holdco Interests
	Recitals

	Maryland Court
	Section 5.9

	Party(ies)
	Preamble

	Purchase Price
	Section 2.4

	Rent Roll
	Section 3.14(d)

	SEC
	Section 3.5

	Transfer Taxes
	Section 2.6

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Section 1.2Interpretation and Rules of Construction. In this Agreement, except to the extent otherwise provided or that the context otherwise requires:
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(a)when a reference is made in this Agreement to an Article, Section or Exhibit, such reference is to an Article or Section of, or an Exhibit to, this Agreement;
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(b)the table of contents and headings for this Agreement are for reference purposes only and do not affect in any way the meaning or interpretation of this Agreement;
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(c)whenever the words “include,” “includes” or “including” are used in this Agreement, they are deemed to be followed by the words “without limitation”;
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(d)the words “hereof,” “herein” and “hereunder” and words of similar import, when used in this Agreement, refer to this Agreement as a whole and not to any particular provision of this Agreement;
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(e)references to any agreement, instrument, statute, rule or regulation are to the agreement, instrument, statute, rule or regulation as amended, modified, supplemented or replaced from time to time, including (in the case of agreements or instruments) by waiver or consent and (in the case of statutes) by succession of comparable successor statutes, and all
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attachments thereto and instruments incorporated therein (and, in the case of statutes, include any rules and regulations promulgated under the statute);
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(f)all terms defined in this Agreement have the defined meanings when used in any certificate or other document made or delivered pursuant hereto, unless otherwise defined therein;
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(g)the definitions contained in this Agreement are applicable to the singular as well as the plural forms of such terms and to the masculine as well as the feminine and neuter genders of such terms;
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(h)references to a Person are also to its successors and permitted assigns;
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(i)except when used together with the word “either” or otherwise for the purpose of identifying mutually exclusive alternatives, the term “or” has the inclusive meaning represented by the phrase “and/or”;
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(j)all uses of currency or the symbol “$” in this Agreement refer to U.S. dollars; and
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(k)where this Agreement states that a Party “shall,” “will” or “must” perform in some manner, it means that the Party is legally obligated to do so under this Agreement.
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ARTICLE 2 
PURCHASE AND SALE; CLOSING
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Section 2.1    Sale and Purchase of the IPT Holdco Interests.  Effective as of the closing of the Interest Sale (the “Closing”), upon the terms and subject to the conditions set forth in this Agreement, Company OP hereby sells, transfers and delivers to BCI IV Holdco, free and clear of any Liens, all of Company OP’s right, title and interest in, to and under the IPT Holdco Interests, including any and all interests of Company OP in and to all profits, losses, distributions and capital in connection with the IPT Holdco Interests and any and all voting rights of Company OP with respect to the IPT Holdco Interests under the governance documents of IPT Holdco from and after the Closing Date. Effective as of the Closing, BCI IV Holdco hereby receives, purchases, accepts and assumes the IPT Holdco Interests from Company OP.
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Section 2.2 Closing. The Closing will take place remotely via an exchange  of  documents and signatures on the date hereof, or at such other time and place as the Parties may mutually agree upon in writing (the “Closing Date”), at which time the documents and instruments referred to in Section 2.3 of this Agreement will be delivered by the Parties.
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Section 2.3Closing Deliveries.
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(a)Company and Company OP Deliveries. Prior to or at the Closing, Company OP will deliver, or cause to be delivered, to BCI IV Holdco (or as otherwise indicated) the following:
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(i)a good standing certificate of IPT Holdco, certified by the DSOS as of a date no more than ten (10) Business Days prior to the Closing Date;
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(ii)a copy of the Certificate of Formation of IPT Holdco, certified by the DSOS as of a date no more than ten (10) Business Days prior to the Closing Date;
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(iii)certificates that comply with Sections 1445 and 1446(f) of the Code, executed by an executive officer of Company, in its capacity as the sole general partner of Company OP, certifying as to Company OP’s non-foreign status;
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(iv)all approvals, amendments, consents and waivers obtained in connection with the Interest Sale, including those necessary to make the representations set forth at Section 3.5(b) true and correct; and
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(v)all other certificates, instruments and documents reasonably necessary or appropriate to consummate the Interest Sale.
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(b)BCI IV Holdco Deliveries. Prior to or at the Closing, BCI IV Holdco will deliver, or cause to be delivered, to Company OP the following:
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(i)the Purchase Price payable in the manner described in Section 2.4; and
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(ii)all other certificates, instruments and documents reasonably necessary or appropriate to consummate the Interest Sale.
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Section 2.4  Purchase Price.  Upon the terms and subject  to the conditions set  forth in this Agreement, BCI IV Holdco agrees to deliver to the Company OP on the Closing Date an amount in cash equal to Three Hundred and One Million Dollars ($301,000,000) (the “Purchase Price”) by wire transfer or delivery of other immediately available funds to such account or accounts as specified in writing by Company prior to the Closing.
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Section 2.5 Withdrawal and Substitution. Effective as of the Closing, Company OP hereby withdraws from IPT Holdco as a member thereof and does thereupon cease to have or exercise any right or power as a member of IPT Holdco. Effective as of the Closing, BCI IV Holdco is hereby admitted to IPT Holdco as a substitute member with respect to the IPT Holdco Interests, and BCI IV Holdco’s execution of this Agreement signifies its agreement to be bound by the terms and conditions of the limited liability company agreement of IPT Holdco. The Parties agree that the assignment and assumption of the IPT Holdco Interests, the admission of BCI IV Holdco as a substitute member of IPT Holdco and Company OP’s withdrawal as a member of IPT Holdco shall not dissolve IPT Holdco.
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Section 2.6 Transfer Taxes. BCI IV Holdco and Company OP shall cooperate in the preparation, execution and filing of all returns, questionnaires, applications or other documents regarding any real property transfer or gains, sales, use, transfer, value added, stock transfer or stamp taxes, any transfer, recording, registration and other fees and any similar Taxes that become payable in connection with the transactions contemplated by this Agreement (together
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with any related interest, penalties or additions to Tax, “Transfer Taxes”), and shall cooperate in attempting to minimize the amount of Transfer Taxes.
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Section 2.7  REIT Status of the BTC REITs.  After the Closing Date though the end of the taxable year that includes the Closing Date, BCI IV Holdco shall use its commercially reasonable efforts to maintain the status of each of the BTC REITs as a REIT.
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF COMPANY OP
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Company OP hereby represents and warrants to BCI IV Holdco that: 
Section 3.1Organization and Qualification.
(a)Company OP is a limited partnership duly organized, validly existing and in good standing under the laws of the State of Delaware. Company OP has the requisite organizational power and authority to own, lease, hold, encumber and operate its properties and to carry on its business as it is now being conducted and is duly qualified or licensed to do business, and is in good standing, in each jurisdiction where the character of the properties owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect.
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(b)Each IPT Holdco Subsidiary is duly organized, validly existing and in good standing (to the extent applicable) under the Laws of the jurisdiction of its incorporation or organization, as the case may be, and has the requisite organizational power and authority to own, lease, hold, encumber and operate its properties and to carry on its business as it is now being conducted. Each IPT Holdco Subsidiary is duly qualified or licensed to do business, and is in good standing, in each jurisdiction where the character of the properties owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect.
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(c)Section 3.1(c) of the Company Disclosure Letter sets forth a true, complete and correct list of the IPT Holdco Subsidiaries, together with (i) the jurisdiction of incorporation or organization, as the case may be, of each IPT Holdco Subsidiary, (ii) the type of and percentage of interest held by Company OP or an IPT Holdco Subsidiary in each IPT Holdco Subsidiary and (iii) the names of and the type of and percentage of interest held by any Person other than Company OP or an IPT Holdco Subsidiary in each IPT Holdco Subsidiary.
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(d)No IPT Holdco Subsidiary directly or indirectly owns any interest or investment (whether equity or debt) in any Person other than in other IPT Holdco Subsidiaries and investments in short-term investment securities.
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Section 3.2Organizational Documents.
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(a)Company OP has made available to BCI IV Holdco true, complete and correct copies of IPT Holdco’s limited liability company agreement as amended and in effect on the date hereof.
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(b)To the extent requested by BCI IV Holdco, Company OP has made available to BCI IV Holdco true, complete and correct copies of the organizational documents of the IPT Holdco Subsidiaries as in effect on the date hereof.
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Section 3.3Capital Structure.
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(a)There are no outstanding bonds, debentures, notes or other Indebtedness of any IPT Holdco Subsidiary having the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matter on which other equity holders of any IPT Holdco Subsidiary may vote (whether together with such holders or as a separate class).
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(b)All of the outstanding shares of capital stock of each of the IPT Holdco Subsidiaries that is a corporation are duly authorized, validly issued, fully paid and nonassessable. All equity interests in each of the IPT Holdco Subsidiaries that is a partnership or limited liability company are duly authorized and validly issued. All of the shares of capital stock and other ownership interests of the IPT Holdco Subsidiaries that are owned, directly or indirectly, by Company OP are owned by Company OP free and clear of all encumbrances other than Company Permitted Liens or statutory or other Liens for Taxes or assessments that are not yet due or delinquent or the validity of which is being contested in good faith by appropriate proceedings and for which adequate accruals and reserves are being maintained on the Company’s financial statements (if such reserves are required pursuant to GAAP).
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(c)There are no outstanding subscriptions, securities options, warrants, calls, rights, profits interests, stock appreciation rights, phantom stock, convertible securities, rights of first refusal or other similar rights, agreements, arrangements, undertakings or commitments of any kind to which any of the IPT Holdco Subsidiaries is a party or by which any of them is bound obligating any of the IPT Holdco Subsidiaries to (i) issue, deliver, transfer or sell or create, or cause to be issued, delivered, transferred or sold or created any additional shares of capital stock or other equity interests or phantom stock or other contractual rights the value of which is determined in whole or in part by the value of any equity security of any IPT Holdco Subsidiary or securities convertible into or exchangeable for such shares or equity interests,

(ii)issue, grant, extend or enter into any such subscriptions, options, warrants, calls, rights, profits interests, stock appreciation rights, phantom stock, convertible securities or other similar rights, agreements, arrangements, undertakings or commitments, or (iii) redeem, repurchase or otherwise acquire any such shares of capital stock or other equity interests.
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(d)Other than pursuant to the organizational documents of the IPT Holdco Subsidiaries, no IPT Holdco Subsidiary is a party to or bound by any agreements or understandings concerning the voting (including voting trusts and proxies) of any capital stock or other equity interests of any of the IPT Holdco Subsidiaries or which restrict the transfer of any such shares, nor are there any third-party agreements or understandings with respect to the voting
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of any such shares or equity interests or which restrict the transfer of any such shares or equity interests.
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(e)No IPT Holdco Subsidiary is under any obligation, contingent or otherwise, by reason of any contract to register the offer and sale or resale of any of their securities under the Securities Act.
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(f)All dividends or other distributions on the equity securities of any IPT Holdco Subsidiary that have been authorized or declared prior to the date hereof have been paid in full.
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Section 3.4Authority.
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(a)Company OP has the requisite power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated by this Agreement to which Company OP is a party, including the Interest Sale. The execution, delivery and performance of this Agreement by Company OP and the consummation by Company OP of the transactions contemplated by this Agreement have been duly and validly authorized by all necessary action on behalf of Company OP, and no other proceedings on the part of Company OP are necessary to authorize this Agreement or the Interest Sale or to consummate the other transactions contemplated by this Agreement. This Agreement has been duly authorized, executed and delivered by Company OP, and assuming due authorization, execution and delivery by BCI IV Holdco, constitutes a legally valid and binding obligation of Company OP enforceable against Company OP in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).
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(b)The Company Board, at a duly held meeting, following the unanimous approval and recommendation of the Company Special Committee, has (i) on behalf of the Company, (a) determined that the sale of the Company’s indirect interests in IPT Holdco (including its indirect interests in Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP) pursuant to the Interest Sale and the other transactions contemplated by the Interest Purchase Agreement are advisable and in the best interests of Company and its shareholders, (b) determined that the sale of the Company’s indirect interests IPT Holdco (including its indirect in interests in Build-To-Core Industrial Partnership I LP and Build-To- Core Industrial Partnership II LP) pursuant to the Interest Sale and the other transactions contemplated by the Interest Purchase Agreement are fair and reasonable to the Company and on terms and conditions no less favorable to the Company than those available from an unaffiliated third party and (c) authorized and approved the sale of the Company’s indirect interests in IPT Holdco (including its indirect interests in Build-To-Core Industrial Partnership I LP and Build- To-Core Industrial Partnership II LP) pursuant to the Interest Sale and the other transactions contemplated by the Interest Purchase Agreement, and (ii) on behalf of the Company in its capacity as the sole general partner of Company OP, on behalf of Company OP, (a) determined that the Interest Sale and other transactions contemplated by the Interest Purchase Agreement are
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advisable and in the best interests of Company OP and its partners and (b) authorized, approved and adopted the Interest Purchase Agreement and authorized and approved the negotiation, execution, delivery and performance by Company OP of the Interest Purchase Agreement and consummation of each of the transactions contemplated thereby (including, without limitation, the Interest Sale), which resolutions remain in full force and effect and have not been subsequently rescinded, modified or withdrawn in any way.
Section 3.5No Conflict; Required Filings and Consents.
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(a)Assuming that all consents, approvals, authorizations and permits described in Section 3.5(b) have been obtained, all filings and notifications described in Section 3.5(b) have been made and any waiting periods thereunder have terminated or expired, the execution and delivery of this Agreement by Company OP does not, and the performance of this Agreement and its obligations hereunder will not, (i) conflict with or violate any provision of the Company Partnership Agreement, or any equivalent organizational document of any IPT Holdco Subsidiary, (ii) conflict with or violate any Law applicable to Company OP or any IPT Holdco Subsidiary or by which any property or asset of Company OP or any IPT Holdco Subsidiary is bound, or (iii) require any consent or approval (except as contemplated by Section 3.5(b)) under, result in any breach of any obligation or any loss of any benefit or material increase in any cost or obligation of Company OP or any IPT Holdco Subsidiary under, or constitute a default (or an event that, with notice or lapse of time or both, would become a default) under, or give to any other Person any right of termination, acceleration or cancellation (with or without notice or the lapse of time or both) of, or give rise to any right of purchase, first offer or forced sale under or result in the creation of a Lien on any property or asset of Company OP or any IPT Holdco Subsidiary pursuant to, any note, bond, debt instrument, indenture, contract, agreement, ground lease, license, permit or other legally binding obligation to which Company OP or any IPT Holdco Subsidiary is a party, except, as to clause (ii) or (iii) above, for any such conflicts, violations, breaches, defaults or other occurrences that, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, and except as to clause
(iii)for consents and approvals that have been obtained and delivered to BCI IV Holdco in accordance with Section 2.3(a)(iv).
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(b)The execution and delivery of this Agreement by Company OP does not, and the performance of this Agreement by Company OP will not, require any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Authority, except

(i)the filing with the SEC of such reports under, and other compliance with, the Exchange Act and the Securities Act as may be required in connection with this Agreement and the transactions contemplated hereby, (ii) such filings as may be required in connection with state and local Transfer Taxes, and (iii) where failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect.
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Section 3.6Permits; Compliance with Law.
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(a)Except for the Environmental Permits and the Property Permits, which are addressed solely in Section 3.13 and Section 3.14, respectively, each IPT Holdco Subsidiary is in possession of all authorizations, licenses, permits, certificates, approvals, variances, exemptions, orders, franchises, certifications and clearances of any Governmental Authority necessary for the lawful conduct of their respective businesses (such permits, excluding Environmental Permits 

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and Property Permits, the “Company Permits”), and all such Company Permits are valid and in full force and effect, except where the failure to be in possession of, or the failure to be valid or in full force and effect of, any of such Company Permits, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect. Each IPT Holdco Subsidiary is in compliance with the terms of the Company Permits, except where the failure to so comply does not have and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary has received any written notice nor has any Knowledge indicating that it currently is not in compliance in any material respect with the terms of any Company Permit.
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(b)No IPT Holdco Subsidiary is or has been in conflict with, or in default or violation of (i) any Law applicable to it or by which any property or asset of it is bound (except for Laws addressed in Section 3.10, Section 3.12, Section 3.13, or Section 3.14 which are solely addressed in those Sections), or (ii) any Company Permits, except, in the case of clauses (i) and (ii), for any such conflicts, defaults or violations that, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect.
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Section 3.7Financial Statements; No Undisclosed Material Liabilities.
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(a)The financial statements of the BTC Entities provided to BCI IV have been prepared in accordance with GAAP applied on a consistent basis during the periods involved (except as may be indicated in the notes thereto, or, in the case of the unaudited statements, as permitted by Rule 10-01 of Regulation S-X under the Exchange Act) and fairly presented, in all material respects, in accordance with applicable requirements of GAAP and the applicable rules and regulations of the SEC (subject, in the case of the unaudited statements, to normal, recurring adjustments), the financial position of the BTC Entities as of their respective dates and the consolidated statements of income and the consolidated cash flows of the BTC Entities for the periods presented therein.
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(b)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, there are no material liabilities of any IPT Holdco Subsidiary of any nature that would be required under GAAP to be set forth on the financial statements of the Company or the notes thereto, other than: (a) liabilities reflected or reserved against as required by GAAP on Company’s most recent consolidated balance sheet (or notes thereto) included in the forms, documents, statements, schedules and reports required to be filed by Company with the Securities and Exchange Commission (the “SEC”) since January 1, 2016; (b) liabilities incurred in connection with the transactions contemplated by this Agreement; or (c) liabilities incurred in the ordinary course of business consistent with past practice since December 31, 2019.
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Section 3.8 No Default. Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary is in default or violation of any term, condition or provision of (a) the organizational documents of any IPT Holdco Subsidiary, or (b), any loan or credit agreement, note, or any bond, mortgage or indenture, to which any IPT Holdco Subsidiary is a party or by which any IPT Holdco  Subsidiary or any of its properties or assets is bound.
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Section 3.9 Litigation. Except as individually or in  the  aggregate  would  not reasonably be expected to have a Company Material Adverse Effect, as of the date hereof, (a) there is no Action pending or, to the Knowledge of Company OP, threatened against any IPT Holdco Subsidiary and (b) no IPT Holdco Subsidiary, nor any of their respective properties, is subject to any outstanding Order of any Governmental Authority.
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Section 3.10 Taxes.
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(a)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, each IPT Holdco Subsidiary has timely filed with the appropriate Governmental Authority all material Tax Returns required to be filed, taking into account any extensions of time within which to file such Tax Returns, and all such Tax Returns were true, complete and correct in all respects. Each IPT Holdco Subsidiary has duly and timely paid (or there has been paid on their behalf), or made adequate provisions in accordance with GAAP for, all Taxes required to be paid by them, whether or not shown on any Tax Return, except where the failure to pay or make provisions for such Taxes would not, individually or in the aggregate, be reasonably expected to have a Company Material Adverse Effect.
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(b)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, (i) there are no audits, investigations by any Governmental Authority or other proceedings ongoing or, to the Knowledge of Company OP, threatened with regard to any material Taxes or Tax Returns of any IPT Holdco Subsidiary;
(ii)no material deficiency for Taxes of any IPT Holdco Subsidiary has been claimed, proposed or assessed in writing or, to the Knowledge of Company OP, threatened, by any Governmental Authority, which deficiency has not yet been settled except for such deficiencies that are being contested in good faith; (iii) no IPT Holdco Subsidiary has waived any statute of limitations with respect to the assessment of material Taxes or agreed to any extension of time with respect to any material Tax assessment or deficiency for any open tax year; (iv) no IPT Holdco Subsidiary is currently the beneficiary of any extension of time within which to file any material Tax Return; and (v) no IPT Holdco Subsidiary has entered into any “closing agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local or foreign income Tax Law). No claim has been made by a Governmental Authority in a jurisdiction where a IPT Holdco Subsidiary does not file Tax Returns that such IPT Holdco Subsidiary is or may be subject to taxation in that jurisdiction.
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(c)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary holds any asset
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the disposition of which would be subject to Treasury Regulation Section 1.337(d)-7, nor have they disposed of any such asset during their current taxable year.
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(d)For all taxable years commencing with its first taxable year, except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary incurred (i) any material liability for Taxes under Sections 857(b)(1), 857(b)(4), 857(b)(5), 857(b)(6)(A), 857(b)(7), 860(c) or 4981 of the Code that have not been previously paid, and (ii) any liability for Taxes under Sections 857(b)(5) (for income test violations), 856(c)(7)(C) (for asset test violations), or 856(g)(5)(C) (for violations of other qualification requirements applicable to REITs). Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary has incurred any material liability for Tax other than (A) in the ordinary course of business consistent with past practice, or (B) transfer or similar Taxes arising in connection with sales of property. Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no Event has occurred, and no condition or circumstance exists, that presents a material risk that any material liability for Taxes described clause (i) of the first sentence of this paragraph or the preceding sentence or any liability for Taxes described in clause (ii) of the first sentence of this paragraph will be imposed upon any IPT Holdco Subsidiary.
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(e)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, each IPT Holdco Subsidiary  has complied, in all material respects, with all applicable Laws relating to the payment and withholding of Taxes (including withholding of Taxes pursuant to Sections 1441, 1442, 1445, 1446 and 3402 of the Code or similar provisions under any state and foreign Laws) and have duly and timely withheld and, in each case, have paid over to the appropriate taxing authorities all material amounts required to be so withheld and paid over on or prior to the due date thereof under all applicable Laws.
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(f)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, there are no Tax Liens upon any property or assets of any IPT Holdco Subsidiary, except (i) Liens for Taxes not yet due and payable or that are being contested in good faith by appropriate proceedings and for which  adequate reserves have been established in accordance with GAAP or (ii) the Company Permitted Liens.
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(g)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, there are no Tax allocation or sharing agreements or similar arrangements with respect to or involving any IPT Holdco Subsidiary.
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(h)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary has requested, received or is subject to any written ruling of a Governmental Authority or has entered into any written agreement with a Governmental Authority with respect to any Taxes.
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(i)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary has (i) been a
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member of an affiliated group filing a consolidated federal income Tax Return (other than the group the common parent of which was Company) nor (ii) has any liability for the Taxes of any Person (other than any IPT Holdco Subsidiary) (A) under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign law), or (B) as a transferee or successor, by contract, or otherwise.
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(j)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary has participated in any “listed transaction” within the meaning of Treasury Regulation Section 1.6011-4(b).
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(k)Except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect, no IPT Holdco Subsidiary has constituted either a “distributing corporation” or a “controlled corporation” (within the meaning of Section 355(a)(1)(A) of the Code) in a distribution of stock qualifying for tax-free treatment under Section 355 of the Code (i) in the two (2) years prior to the date of this Agreement or (ii) in a distribution which could otherwise constitute part of a “plan” or “series of related transactions” (within the meaning of Section 355(e) of the Code) in conjunction with transactions contemplated by this Agreement.
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(l)No written power of attorney that has been granted by any IPT Holdco Subsidiary is currently in force with respect to any matter relating to Taxes, except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect.
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(m)Based solely on the analysis performed by an external advisor to Company OP, to the Knowledge of Company OP, there are no Transfer Taxes that are anticipated to become payable in connection with the transactions contemplated by this Agreement.
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Section 3.11 Benefit Plans; Employees.
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(a)No IPT Holdco Subsidiary (i) maintains, sponsors, contributes to or has any liability (whether actual or contingent) with respect to, and (ii) has ever maintained, sponsored, contributed to or had any liability (whether actual or contingent) with respect to, any Benefit Plan. No IPT Holdco Subsidiary has any contract, plan or commitment, whether or not legally binding, to adopt or sponsor any Benefit Plan.
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(b)No IPT Holdco Subsidiary has, nor has ever had, any employees.
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(c)No IPT Holdco Subsidiary or any of any of their respective ERISA Affiliates maintains, contributes to, or participates in, or has ever maintained, contributed to, or participated in, or otherwise has any obligation or liability in connection with: (i) a “pension plan” under Section 3(2) of ERISA that is subject to Title IV or Section 302 of ERISA or Section 412 or 4971 of the Code; or (ii) a “multiemployer plan” (as defined in Section 3(37) of ERISA).
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Section 3.12 Intellectual Property. To the Knowledge of Company OP, no Intellectual Property used by any IPT Holdco Subsidiary infringes or is alleged to infringe any Intellectual
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Property rights of any third party, except as, individually or in the aggregate, would not be reasonably expected to have a Company Material Adverse Effect. To the Knowledge of Company OP, except, individually or in the aggregate, as would not be reasonably expected to have a Company Material Adverse Effect, no Person is misappropriating, infringing or otherwise violating any Intellectual Property of any IPT Holdco Subsidiary. Except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, each IPT Holdco Subsidiary owns or is licensed to use, or otherwise possess valid rights to use, all Intellectual Property necessary to conduct the business of the IPT Holdco Subsidiaries as it is currently conducted.
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Section 3.13 Environmental Matters. Except (i) as set forth in Section 3.13 of the Company Disclosure Letter or (ii) as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect:
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(a)each IPT Holdco Subsidiary is in compliance with all Environmental Laws;
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(b)each IPT Holdco Subsidiary has all Environmental Permits necessary to conduct its current operations and is in compliance with such Environmental Permits;
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(c)no IPT Holdco Subsidiary has received any written notice, demand, letter or claim alleging that it is in violation of, or liable under, any Environmental Law or that any Order has been issued against it that remains unresolved;
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(d)there is no Action pending, or, to the Knowledge of Company OP, threatened against any IPT Holdco Subsidiary under any Environmental Law;
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(e)no IPT Holdco Subsidiary has entered into or agreed to any Order or is subject to any judgment, decree or judicial, administrative or compliance order relating to compliance with Environmental Laws, Environmental Permits or the investigation, sampling, monitoring, treatment, remediation, removal or cleanup of Hazardous Substances; and
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(f)no IPT Holdco Subsidiary has caused any release of a Hazardous Substance that would be required to be investigated or remediated by any IPT Holdco Subsidiary under any Environmental Law.
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Notwithstanding any other provision of this Agreement, this Section 3.13 contains the exclusive representations and warranties of Company OP with respect to environmental matters, Environmental Laws or Hazardous Substances.
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Section 3.14 Properties.
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(a)The IPT Holdco Subsidiaries own good and valid fee simple title or leasehold title (as applicable) to the Company Properties, in each case, free and clear of Liens, except for Company Permitted Liens. Section 3.14(a) of the Company Disclosure Letter sets forth a true, compete and correct list of the address of each Company Property.
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(b)The IPT Holdco Subsidiaries have in effect all Property Permits or agreements, easements or other rights that are necessary to permit the current use and operation of the buildings and improvements on any of the Company Properties, except for such failures to have in effect that, individually or in the aggregate, would not reasonably be expected to have a 

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Company Material Adverse Effect. No IPT Holdco Subsidiary has received (i) written notice that any Property Permit or any agreement, easement or other right that is necessary to permit the current use and operation of the buildings and improvements on any of the Company Properties is not in full force and effect as of the date hereof (or of any pending written threat of modification or cancellation of any of same), except for such failures to be in full force and effect that, individually, or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, or (ii) written notice of any uncured violation of any Laws affecting any of the Company Properties that, individually or in the aggregate, would reasonably be expected to have a Company Material Adverse Effect.
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(c)Except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, no condemnation, eminent domain or similar proceeding is pending with respect to any owned Company Property, and no IPT Holdco Subsidiary has received any written notice to the effect that (i) any condemnation or rezoning proceedings are threatened with respect to any of Company Properties or (ii) any zoning regulation or ordinance (including with respect to parking), Board of Fire Underwriters rules, building, fire, health or other Law has been violated (and remains in violation) for any Company Property.
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(d)Except as set forth in the Rent Roll or as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, (x) no IPT Holdco Subsidiary has given or received written notice of any breach or violation of, or default under, any Material Company Lease, which breach, violation or default remains outstanding and uncured; (y) no tenant under a Material Company Lease is in monetary default under such Material Company Lease, which default remains outstanding and uncured; and (z) each Material Company Lease is valid, binding and enforceable in accordance with its terms and is in full force and effect with respect to the applicable IPT Holdco Subsidiary and, to the Knowledge of Company OP, with respect to the other parties thereto, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law). True and complete (in all material respects) copies of all Material Company Leases have been made available to BCI IV Holdco. Except for discrepancies, errors or omissions that, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, the information set forth under the headings “Tenant,” “Currently Monthly Rent,” “Lease From, “Lease To,” “Lease Area,” and “Rent Increase” in the rent rolls for each of the Company Properties, as of June 30, 2020, which rent rolls have previously been made available to BCI IV Holdco (including an indication of whether any Company Property is subject to net leases), are true and correct (the “Rent Roll”).
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(e)Except for Company Permitted Liens or as set forth in the Company Leases, Company Title Insurance Policies (and all documents referenced therein) or the organizational documents of the IPT Holdco Subsidiaries, or as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, (i) there are no unexpired option to purchase agreements, rights of first refusal or first offer or any other rights to purchase or otherwise acquire any Company Property or any portion thereof that would materially adversely affect any IPT Holdco Subsidiary’s, ownership, ground lease or other interest, or right to use, a Company Property subject to a Material Company Lease, and (ii) there are no other outstanding rights or agreements to enter into any contract for sale, ground lease or letter of intent to sell or ground lease any Company Property or any portion thereof that is owned by any IPT Holdco Subsidiary, which, in each case, is in favor of any party other than any IPT Holdco Subsidiary (a “Company Third Party”).
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(f)Except pursuant to a Company Lease, or any ground lease affecting any Company Property, no IPT Holdco Subsidiary is a party to any agreement pursuant to which any IPT Holdco Subsidiary manages or manages the development of any real property for any Company Third Party.
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(g)For each Company Property, policies of (i) title insurance have been issued insuring, as of the effective date of each such insurance policy, fee simple title interest held by the applicable IPT Holdco Subsidiary with respect to the Company Properties that are not subject to the ground leases, and (ii) leasehold insurance have been issued insuring, as of the effective date of each such insurance policy, the leasehold interest that the applicable IPT Holdco Subsidiary holds with respect to each Company Property that is subject to a ground lease (each, a “Company Title Insurance Policy” and, collectively, the “Company Title Insurance Policies”). Except as, individually or in the aggregate, would not be reasonably expected to have a  Company Material Adverse Effect, no written claim has been made against any Company Title Insurance Policy.
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(h)The IPT Holdco Subsidiaries have good and valid title to, or a valid and enforceable leasehold interest in, or other right to use, all personal property owned, used or held for use by it as of the date hereof (other than property owned by tenants and used or held in connection with the applicable tenancy), except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect. None of the IPT Holdco Subsidiaries’ ownership of or leasehold interest in any such personal property is subject to any Liens, except for Company Permitted Liens and Liens that would not reasonably be expected to have a Company Material Adverse Effect.
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(i)No IPT Holdco Subsidiary (i) has received written notice of any structural defects relating to any Company Property that would have, or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, or (ii) has received written notice of any physical damage to any Company Property that would have, or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect for which there is not insurance in effect covering the cost of the restoration and the loss of revenue, subject to reasonable deductibles and retention limits.
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Section 3.15 Material Contracts. Except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, each Company Material Contract is legal, valid, binding and enforceable against the applicable IPT Holdco Subsidiary and, to the Knowledge of Company OP, each other party thereto, and is in full force and effect, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at Law). Each IPT Holdco Subsidiary has performed all obligations required to be performed by it under each Company Material Contract and, to the Knowledge of Company OP, each other party thereto has performed all obligations required to be performed by it under such Company Material Contract, in each case, except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect. No IPT Holdco Subsidiary nor, to the Knowledge of Company OP, any other party thereto, is in breach or violation of, or default under, any  Company Material Contract, and no event has occurred that, with notice or lapse of time or both, would constitute a violation, breach or default under any Company Material Contract, except where in each case such violation, breach or default is not reasonably likely to have, individually or in the aggregate, a Company Material Adverse Effect. Except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, as of the date hereof, no IPT Holdco Subsidiary has received written notice of any material violation or material default under any Company Material Contract. Section 3.15 of the Company Disclosure Letter sets forth a true, complete and correct list of all outstanding Indebtedness of IPT Holdco Subsidiaries as of the date set forth therein, other than Indebtedness payable to another IPT Holdco Subsidiary.
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Section 3.16 Insurance. The IPT Holdco Subsidiaries maintain insurance coverage with reputable insurers in such amounts and covering such risks which the IPT Holdco Subsidiaries believe are adequate for the operation of their respective businesses and the protection of their respective assets. As of the date hereof, and except as, individually or in the aggregate,  would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, there is no claim by any IPT Holdco Subsidiary pending under any such insurance policies that has been denied or disputed by the insurer. Except as, individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, all premiums due and payable under all Company Insurance Policies have been paid, and each IPT Holdco Subsidiary has otherwise complied in all material respects with the terms and conditions of its respective Company Insurance Policies. Except as individually or in the aggregate, would not reasonably be expected to have a Company Material Adverse Effect, to the Knowledge of Company OP, such Company Insurance Policies are valid and enforceable in accordance with their terms and are in full force and effect. No written notice of cancellation or termination has been received by any IPT Holdco Subsidiary with respect to any such policy that has not been replaced on substantially similar terms prior to the date of such cancellation.
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Section 3.17  Brokers.  Except for the fees and expenses payable to the Persons set forth in Section 3.17 of the Company Disclosure Letter, no broker, investment banker or other Person is entitled to any broker's, finder's or other similar fee or commission in connection with the transactions contemplated by this Agreement based upon arrangements made by or on behalf of the Company, Company OP or any IPT Holdco Subsidiary.
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Section 3.18  Related-Party Transactions.  Except  for or pursuant to this Agreement or  as set forth in the Company SEC Documents, from January 1, 2020 through the date of this Agreement there have been no transactions, agreements, arrangements or understandings between an IPT Holdco Subsidiary, on the one hand, and any Affiliates (other than other IPT Holdco Subsidiaries) thereof, on the other hand, that would be required to be disclosed by the Company under Item 404 of Regulation S-K promulgated by the SEC.
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Section 3.19 Investment Company Act. No IPT Holdco Subsidiary is required to be registered as an investment company under the Investment Company Act.
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Section 3.20 No Other Representations and Warranties.  Except for the representations or warranties expressly set forth in this Article 3, neither Company OP nor any other Person has made any representation or warranty, expressed or implied, with respect to Company OP or the IPT Holdco Subsidiaries, their businesses, operations, assets, liabilities, condition (financial or otherwise), results of operations, future operating or financial results, estimates, projections, forecasts, plans or prospects (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, plans or prospects) or the accuracy or completeness of any information regarding Company OP or the IPT Holdco Subsidiaries. In particular, without limiting the foregoing disclaimer, except for the representations and warranties made by Company in this Article 3, neither Company nor any other Person makes or has made any representation or warranty to BCI IV Holdco or any of its Affiliates or Representatives with respect to, any oral or written information presented to BCI IV Holdco or any of its Affiliates or Representatives in the course of their due diligence of Company OP or the IPT Holdco Subsidiaries, the negotiation of this Agreement or in the course of the transactions contemplated hereby.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF BCI IV HOLDCO
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BCI IV Holdco hereby represents and warrants to Company OP that:
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Section 4.1 Organization and Qualification. BCI IV Holdco is a limited  liability company duly organized, validly existing and in good standing under the laws of the State of Delaware. BCI IV Holdco has the requisite organizational power and authority to own, lease, hold, encumber and operate its properties and to carry on its business as it is now being conducted and is duly qualified or licensed to do business, and is in good standing, in each jurisdiction where the character of the properties owned, operated or leased by it or the nature of its business makes such qualification, licensing or good standing necessary, except for such failures to be so qualified, licensed or in good standing that, individually or in the aggregate, would not reasonably be expected to have a BCI IV Material Adverse Effect.
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Section 4.2Authority.
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(a)BCI IV Holdco has the requisite limited liability company power and authority to execute and deliver this Agreement, to perform its obligations hereunder and to consummate the transactions contemplated by this Agreement to which BCI IV Holdco is a
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party, including the Interest Sale. The execution and delivery and performance by BCI IV Holdco of this Agreement and the consummation by BCI IV Holdco of the transactions contemplated by this Agreement have been duly and validly authorized by all necessary action on behalf of BCI IV Holdco, and no other proceedings on the part of BCI IV Holdco are necessary to authorize this Agreement or the Interest Sale or to consummate the other transactions contemplated by this Agreement. This Agreement has been duly authorized, executed and delivered by BCI IV Holdco and assuming due authorization, execution and delivery by Company OP, constitutes a legally valid and binding obligation of BCI IV Holdco, enforceable against BCI IV Holdco in accordance with its terms, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or other similar Laws affecting creditors’ rights generally and by general principles of equity (regardless of whether enforceability is considered in a proceeding in equity or at law).
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(b)The BCI IV Board, following the unanimous approval and recommendation of the BCI IV Special Committee, has (i) determined that (a) this Agreement, the Interest Sale and the other transactions contemplated by this Agreement are advisable and in the best interests of BCI IV and are fair and reasonable to BCI IV, (b) there is substantial justification for the amount by which the Purchase Price exceeds the amount that Company OP invested in IPT Holdco and that the Purchase Price is reasonable, and (c) the joint venture terms of Build-To-Core Industrial Partnership I LP and Build-To-Core Industrial Partnership II LP are fair and reasonable to BCI IV and on terms and conditions that are no less favorable than those that would be available to unaffiliated parties, and (ii) approved this Agreement, the Interest Sale and the other transactions contemplated by this Agreement and authorized BCI IV, in its capacity as the sole general partner of BCI IV OP, on behalf of BCI IV OP, in its capacity as the sole member of BCI IV Holdco, on behalf of BCI IV Holdco, to execute, deliver and perform the Purchase Agreement, which resolutions remain in full force and effect and have not been subsequently rescinded, modified or withdrawn in any way.
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Section 4.3No Conflict; Required Filings and Consents.
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(a)Assuming that all consents, approvals, authorizations and permits described in Section 4.3(b) have been obtained, all filings and notifications described in Section 4.3(b) have been made and any waiting periods thereunder have terminated or expired, the execution and delivery of this Agreement by BCI IV Holdco does not, and the performance of this Agreement and its obligations hereunder will not, (i) conflict with or violate any provision of any organizational or governing document of BCI IV Holdco, or (ii) conflict with or violate any Law applicable to BCI IV Holdco or by which any property or asset of BCI IV Holdco is bound, except, as to this clause (ii), for any such conflicts or violations that, individually or in the aggregate, would not reasonably be expected to have a BCI IV Material Adverse Effect.
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(b)The execution and delivery of this Agreement by BCI IV Holdco does not, and the performance of this Agreement by BCI IV Holdco will not, require any consent, approval, authorization or permit of, or filing with or notification to, any Governmental Authority, except (i) the filing with the SEC of such reports under, and other compliance with, the Exchange Act and the Securities Act as may be required in connection with this Agreement and the transactions contemplated hereby, (ii) such filings as may be required in connection with
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state and local Transfer Taxes, and (iii) where failure to obtain such consents, approvals, authorizations or permits, or to make such filings or notifications, individually or in the aggregate, would not reasonably be expected to have a BCI IV Material Adverse Effect.
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Section 4.4 Investment Representation. BCI IV Holdco is acquiring the IPT Holdco Interests for its own account for purposes of investment and not with a view to the distribution of its interests therein or dividing all or any part of its interest therein with any other Person. BCI IV Holdco acknowledges that the sale of the IPT Holdco Interests has not been registered under Law (including the Securities Act and any state, local or foreign securities laws) and that the IPT Holdco Interests may not be transferred without registration under, pursuant to an exemption from or in a transaction not subject to, Law.
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Section 4.5Taxes.
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(a)BCI IV Holdco’s indirect ownership of the BTC REITs will not cause a material amount received or accrued by any BTC REIT during such BTC REIT’s taxable year that includes the Closing Date to fail to be to treated as “rents from real property” within the meaning of Section 856(d) of the Code by reason of Section 856(d)(2)(B) of the Code to the extent that it would cause such BTC REIT to fail to meet the requirements of Sections 856(c)(2) or 856(c)(3) of the Code for such year.
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(b)BCI IV Holdco’s indirect ownership of the BTC REITs will not cause any BTC REIT to be “closely held” as determined under Section 856(h) of the Code at any time during such BTC REIT’s taxable year that includes the Closing Date.
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ARTICLE 5 
GENERAL PROVISIONS
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Section 5.1 Nonsurvival of Representations, Warranties, Covenants and Agreements. None of the representations, warranties, covenants or agreements made by Company OP in this Agreement or in any instrument delivered by Company OP pursuant to this Agreement (including the Company Disclosure Letter), including any rights arising out of any breach of such representations, warranties, covenants or agreements, shall survive the Closing, and from and after the Closing, BCI IV Holdco shall have no recourse against, and hereby fully releases, Company OP and its Affiliates and their respective shareholders, members, partners, directors, trustees, officers, sponsors, advisors, managers, agents or other representatives (other than with respect to any actual and intentional fraud with respect to the making of any representation or warranty set forth in Article 3).
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Section 5.2 Public Announcements. The Parties hereto shall consult with each other before issuing any press release or otherwise making any public statements or filings with respect to this Agreement or any of the transactions contemplated by this Agreement, and, except as otherwise permitted or required by this Agreement, none of the Parties shall issue any such press release or make any such public statement or filing prior to obtaining the other Parties’ consent (which consent shall not be unreasonably withheld, conditioned or delayed); provided that a Party may, without obtaining the other Parties’ consent, issue such press release or make
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such public statement or filing with respect to this Agreement or any of the transactions contemplated by this Agreement as may be required by Law (including as may be required to avoid suspending an ongoing public offering), Order or the applicable rules of any stock exchange, in which case such Party shall consult with the other Party before making such public statement or filing with respect to this Agreement or any of the transactions contemplated by this Agreement, except to the extent it is not reasonably practicable to do so.
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Section 5.3 Notices. All notices, requests, claims, consents, demands and other communications under this Agreement shall be in writing and delivered (i) in person, (ii) by electronic mail including a .pdf attachment (providing confirmation of transmission), or (iii) sent by prepaid overnight courier (providing proof of delivery), to the Parties at the following addresses (or at such other addresses as shall be specified by the Parties by like notice):

		(a)	if to Company to:	

Industrial Property Trust
518 Seventeenth Street, 17th Floor
Denver, CO 80202
Attn:John Woodberry, Chairman of the Company Special Committee 
email:  john@woodberryholdings.com
with a copy (which shall not constitute notice) to: 
Industrial Property Trust
518 Seventeenth Street, 17th Floor
Denver, CO 80202
		Attn:
	Thomas G. McGonagle, Managing Director & Chief Financial Officer

Joshua J. Widoff, Managing Director & Chief Legal Officer
email: tom.mcgonagle@blackcreekgroup.com
           josh.widoff@blackcreekgroup.com
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and to:
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Hogan Lovells US LLP
555 13th Street NW 
Washington, DC 20004
Attn:David Bonser
Stacey McEvoy
email: david.bonser@hoganlovells.com
           stacey.mcevoy@hoganlovells.com
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(b)if to BCI IV Holdco to:
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BCI IV Portfolio Real Estate Holdco LLC
518 Seventeenth Street, 17th Floor,
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Denver, CO 80202
Attn:Charles B. Duke, Chairman of the BCI IV Special Committee
email:  charlesbduke@gmail.com
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with a copy (which shall not constitute notice) to:
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DLA Piper US LLP
4141 Parklake Avenue, Suite 300
Raleigh, NC 27612-2350
Attn:Robert Bergdolt
email:  rob.bergdolt@dlapiper.com
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All notices, requests, claims, consents, demands and other communications under this Agreement shall be deemed duly given or made (A) if delivered in person, on the date delivered,

(B)if sent by electronic mail (providing confirmation of transmission), on the date it was received, or (C) if sent by prepaid overnight courier, on the next Business Day (providing proof of delivery). For the avoidance of doubt, counsel for a Party may send notices, requests, claims, consents demands or other communications on behalf of such Party.
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Section 5.4     Severability.  If any term or other provision of this Agreement is found by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced under any present or future Law or public policy in any jurisdiction, as to that jurisdiction, (a) such term or other provision shall be fully separable, (b) this Agreement shall be construed and enforced as if such invalid, illegal or unenforceable provision had never comprised a part hereof, (c) all other conditions and provisions of this Agreement shall remain in full force and effect and shall not be affected by the illegal, invalid or unenforceable term or other provision or by its severance herefrom so long as the economic or legal substance of the transactions contemplated by this Agreement is not affected in any manner materially adverse to any Party, and (d) such terms or other provision shall not affect the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced in any jurisdiction, the Parties hereto shall negotiate in good faith to modify this Agreement so as to effect the original intent of the Parties as closely as possible in a mutually acceptable manner in order that transactions contemplated by this Agreement be consummated as originally contemplated to the fullest extent possible.
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Section 5.5 Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original and all of which together shall be deemed one and the same agreement, and shall become effective when one or more counterparts have been signed by each of the Parties and delivered to the other Parties. Signatures to this Agreement transmitted by electronic mail in .pdf format, or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing the original signature.
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Section 5.6 Entire Agreement; No Third-Party Beneficiaries.  This  Agreement constitutes the entire agreement and supersedes all prior agreements and understandings, both
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written and oral, among the Parties, or between any of them, with respect to the subject matter of this Agreement. This Agreement is not intended to and shall not confer any rights or remedies upon any Person other than the Parties and their respective successors and permitted assigns, except for the provisions of Section 2.7 (which, from and after the Closing Date, shall be for the benefit of, and may be enforced by, IPT Liquidator LLC). The representations and warranties in this Agreement are the product of negotiations between the Parties and are for the sole benefit of the Parties. The representations and warranties in this Agreement may represent an allocation among the Parties of risks associated with particular matters regardless of the knowledge of any of the Parties. Accordingly, persons other than the Parties may not rely upon the representations and warranties in this Agreement as characterizations of actual facts or circumstances as of the date of this Agreement or as of any other date.
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Section 5.7 Amendment. Subject to compliance with applicable Law, this Agreement may be amended by mutual agreement of the Parties hereto by action taken or authorized by the Company Board (with the prior approval and recommendation of the Company Special Committee) and the BCI IV Board (with the prior approval and recommendation of the BCI IV Special Committee), respectively. This Agreement may not be amended except by an instrument in writing signed by each of the Parties.
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Section 5.8 Governing Law. This Agreement, and all Actions (whether at Law, in contract or in tort) that may be based upon, arise out of or related to this Agreement or the negotiation, execution or performance of this Agreement, shall be governed by, and construed in accordance with, the laws of the State of Maryland without giving effect to any choice or conflicts of Law principles (whether of the State of Maryland or any other jurisdiction) that would cause the application of the Laws of any jurisdiction other than the State of Maryland.
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Section 5.9 Consent to Jurisdiction. Each Party irrevocably agrees and consents (a) to submit itself to the exclusive jurisdiction of the Circuit Court for Baltimore City (Maryland), and to request assignment to the Business and Technology Case Management Program (the “Maryland Court”) for the purpose of any Action (whether based on contract, tort or otherwise), directly or indirectly, arising out of or relating to this Agreement or the transactions contemplated by this Agreement or the actions of the Parties in the negotiation, administration, performance and enforcement of this Agreement, (b) that it will not attempt to deny or defeat such jurisdiction by motion or other request for leave from any such court, (c) that it waives any objection to the laying of venue of any Action in the Maryland Court and agrees not to plead or claim in the Maryland Court that such litigation brought therein has been brought in any inconvenient forum, (d) that it will not bring any Action relating to this Agreement or the transactions contemplated by this Agreement or the actions of the parties hereto in the negotiation, administration, performance and enforcement of this Agreement in any court other than the Maryland Court, and (e) that a final judgment in any Action shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by Law. Each Party hereby irrevocably and unconditionally agrees to request and/or consent to the assignment of any Action to the Maryland Court’s Business and Technology Case Management Program. Nothing in this Agreement shall limit or affect the rights of any Party to  pursue appeals from any judgments or order of the Maryland Court as provided by Law. Each Party agrees, (x) to the extent such Party is not otherwise subject to service of process in the State of
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Maryland, to appoint and maintain an agent in the State of Maryland as such Party’s agent for acceptance of legal process, and (y) that service of process may also be made on such Party by prepaid certified mail with a proof of mailing receipt validated by the United States Postal Service constituting evidence of valid service. Service made pursuant to clauses (x) or (y) above shall have the same legal force and effect as if served upon such Party personally within the State of Maryland.
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Section 5.10 Assignment. Neither this Agreement nor any of the rights, interests or obligations under this Agreement shall be assigned or delegated, in whole or in part, by operation of Law or otherwise by any of the Parties without the prior written consent of the other Parties, and any attempt to make any such assignment without such consent shall be null and void. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of, and be enforceable by, the Parties and their respective successors and assigns.
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Section 5.11 Remedies. Except as otherwise provided in this Agreement, any and all remedies herein expressly conferred upon a Party will be deemed cumulative with and not exclusive of any other remedy conferred hereby, or by Law or equity upon such Party, and the exercise by a Party of any one remedy will not preclude the exercise of any other remedy.
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Section 5.12 Waiver of Jury Trial. EACH PARTY HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY SUIT, ACTION OR OTHER PROCEEDING (WHETHER BASED ON CONTRACT, TORT OR OTHERWISE) ARISING OUT OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH PARTY (A) CERTIFIES THAT NO REPRESENTATIVE OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH PARTY WOULD NOT, IN THE EVENT OF ANY ACTION, SUIT OR PROCEEDING, SEEK TO ENFORCE THE FOREGOING WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN INDUCED TO ENTER INTO THIS AGREEMENT, BY, AMONG OTHER THINGS, THE MUTUAL WAIVER AND CERTIFICATIONS IN THIS SECTION 6.11.
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Section 5.13 Authorship. The Parties agree that the terms and language of  this Agreement are the result of negotiations among the Parties and their respective advisors and, as a result, there shall be no presumption that any ambiguities in this Agreement shall be resolved against any Party. Any controversy over construction of this Agreement shall be  decided without regard to events of authorship or negotiation.
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IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed and delivered by their respective duly authorized officers, all as of the date first written above.
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BCI IV PORTFOLIO REAL ESTATE HOLDCO LLC
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By: BCI IV Operating Partnership LP, its sole member
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By: Black Creek Industrial REIT IV Inc., its general partner
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By:   /s/ JEFFREY W. TAYLOR
     Name: Jeffrey W. Taylor
     Title:    Managing Director, Co-President
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INDUSTRIAL PROPERTY OPERATING PARTNERSHIP LP
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By: Industrial Property Trust, its general partner
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By:   /s/ THOMAS G. MCGONAGLE
     Name: Thomas G. McGonagle
     Title:    Chief Financial Officer

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