Document:

Exhibit 10.6

 

 

Bank of America, N.A.
 c/o Merrill Lynch, Pierce, Fenner & Smith Incorporated
 One Bryant Park
 New York, NY 10036

 

	
To:
    	
The Medicines Company
   8 Sylvan Way
   Parsippany, New Jersey 07054
   Attention: William B. O’Connor, Chief Financial Officer
   Telephone No.: 973-290-6094
    
	
 
    	
 
    
	
Re:
    	
Additional Call Option   Transaction
    
	
 
    	
 
    
	
Date:
    	
June 7, 2016
    

 

Dear Ladies and Gentlemen:

 

The purpose of this communication (this “Confirmation”) is to set forth the terms and conditions of the above-referenced transaction entered into on the Trade Date specified below (the “Transaction”) between Bank of America, N.A. (“Dealer”) and The Medicines Company (“Counterparty”).  This communication constitutes a “Confirmation” as referred to in the Agreement specified below.

 

1.              This Confirmation is subject to, and incorporates, the definitions and provisions of the 2006 ISDA Definitions (the “2006 Definitions”) and the definitions and provisions of the 2002 ISDA Equity Derivatives Definitions (the “Equity Definitions”, and together with the 2006 Definitions, the “Definitions”), in each case as published by the International Swaps and Derivatives Association, Inc. (“ISDA”).  Certain defined terms used herein have the meanings assigned to them in the Indenture to be dated as of June 10, 2016 between Counterparty and Wells Fargo Bank, National Association, as trustee (the “Indenture”), relating to the USD350,000,000 principal amount of 2.75% Convertible Senior Notes due 2023 (the “Base Convertible Securities”) and the additional USD52,500,000 principal amount of 2.75% Convertible Senior Notes due 2023 issued pursuant to the option to purchase additional convertible securities exercised on the date hereof (the “Optional Convertible Securities” and, together with the Base Convertible Securities, the “Convertible Securities”).  In the event of any inconsistency between the terms defined in the Indenture and this Confirmation, this Confirmation shall govern.  For the avoidance of doubt, references herein to sections of, or definitions set forth in, the Indenture are based on the draft of the Indenture most recently reviewed by the parties at the time of execution of this Confirmation.  If any relevant sections of, or definitions set forth in, the Indenture are changed, added or renumbered between the execution of this Confirmation and the execution of the Indenture, the parties will amend this Confirmation in good faith to preserve the economic intent of the parties, as evidenced by such draft of the Indenture.  Subject to the foregoing, the parties acknowledge that references to the Indenture herein are references to the Indenture as in effect on the date of its execution and if the Indenture is, or the Convertible Securities are, amended, modified or supplemented following the date hereof or the date of their execution, respectively, any such amendment, modification or supplement (other than any amendment, modification or supplement pursuant to a Merger Supplemental Indenture (as defined below)) will be disregarded for purposes of this Confirmation unless the parties agree otherwise in writing.

 

Each party is hereby advised, and each such party acknowledges, that the other party has engaged in, or refrained from engaging in, substantial financial transactions and has taken other material actions in reliance upon the parties’ entry into the Transaction to which this Confirmation relates on the terms and conditions set forth below.

 

 

This Confirmation evidences a complete and binding agreement between Dealer and Counterparty as to the terms of the Transaction to which this Confirmation relates.  This Confirmation shall be subject to an agreement (the “Agreement”) in the form of the 2002 ISDA Master Agreement as if Dealer and Counterparty had executed an agreement in such form on the date hereof (but without any Schedule except for (i) the election of the laws of the State of New York as the governing law (without reference to choice of law doctrine) and (ii) the election that the “Cross Default” provisions of Section 5(a)(vi) of the Agreement shall apply to Dealer with a Threshold Amount of 3% of Dealer’s shareholders’ equity on the Trade Date (provided that (a) the phrase “, or becoming capable at such time of being declared,” shall be deleted from clause (1) of such Section 5(a)(vi) of the Agreement, (b) “Specified Indebtedness” shall have the meaning specified in Section 14 of the Agreement, except that such term shall not include obligations in respect of deposits received in the ordinary course of Dealer’s banking business and (c) the following sentence shall be added to the end of Section 5(a)(vi) of the Agreement: “Notwithstanding the foregoing, a default under subsection (2) hereof shall not constitute an Event of Default if (x) the default was caused solely by error or omission of an administrative or operational nature; (y) funds were available to enable the relevant party to make the payment when due; and (z) the payment is made within two Local Business Days of such party’s receipt of written notice of its failure to pay.”))

 

All provisions contained in, or incorporated by reference to, the Agreement will govern this Confirmation except as expressly modified herein.  In the event of any inconsistency among this Confirmation, the Equity Definitions, the 2006 Definitions or the Agreement, the following shall prevail in the order of precedence indicated: (i) this Confirmation; (ii) the Equity Definitions; (iii) the 2006 Definitions; and (iv) the Agreement.  For the avoidance of doubt, except to the extent of an express conflict, the application of any provision of this Confirmation, the Agreement, the Equity Definitions or the 2006 Definitions shall not be construed to exclude or limit any other provision of this Confirmation, the Agreement, the Equity Definitions or the 2006 Definitions.

 

The Transaction hereunder shall be the sole Transaction under the Agreement.  If there exists any ISDA Master Agreement between Dealer and Counterparty or any confirmation or other agreement between Dealer and Counterparty pursuant to which an ISDA Master Agreement is deemed to exist between Dealer and Counterparty, then notwithstanding anything to the contrary in such ISDA Master Agreement, such confirmation or agreement or any other agreement to which Dealer and Counterparty are parties, the Transaction shall not be considered a Transaction under, or otherwise governed by, such existing or deemed ISDA Master Agreement.

 

2.              The Transaction constitutes a Share Option Transaction for purposes of the Equity Definitions.  The terms of the particular Transaction to which this Confirmation relates are as follows:

 

General Terms:

 

	
Trade Date:
    	
 
    	
June 7, 2016
    
	
 
    	
 
    	
 
    
	
Option Style:
    	
 
    	
Modified American, as described under “Procedures   for Modified American Exercise” below.
    
	
 
    	
 
    	
 
    
	
Option Type:
    	
 
    	
Call
    
	
 
    	
 
    	
 
    
	
Seller:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
Buyer:
    	
 
    	
Counterparty
    
	
 
    	
 
    	
 
    
	
Shares:
    	
 
    	
The Common Stock of Counterparty, par value USD   0.001 (Ticker Symbol: “MDCO”).
    
	
 
    	
 
    	
 
    
	
Number of Options:
    	
 
    	
The number of Optional Convertible Securities in   denominations of USD1,000 principal amount purchased by the Initial   Purchasers (as defined in the Purchase Agreement), at their option pursuant   to Section 2 of the Purchase Agreement (as defined 
    

 

2

 

	
 
    	
 
    	
below). For the avoidance of doubt, the Number of   Options outstanding shall be reduced by each exercise of Options hereunder.
    
	
 
    	
 
    	
 
    
	
Applicable Percentage:
    	
 
    	
20%
    
	
 
    	
 
    	
 
    
	
Option Entitlement:
    	
 
    	
A number equal to the product of the Applicable   Percentage and 20.4198.
    
	
 
    	
 
    	
 
    
	
Fundamental Change   Adjustment:
    	
 
    	
Any adjustment to the Conversion Rate pursuant to   Section 14.03 of the Indenture.
    
	
 
    	
 
    	
 
    
	
Discretionary   Adjustment:
    	
 
    	
Any adjustment to the Conversion Rate pursuant to   Section 14.04(h) of the Indenture.
    
	
 
    	
 
    	
 
    
	
Strike Price:
    	
 
    	
USD48.9721
    
	
 
    	
 
    	
 
    
	
Cap Price:
    	
 
    	
USD64.6800. For the avoidance of doubt, in no event   shall the Cap Price be adjusted to be less than the Strike Price.
    
	
 
    	
 
    	
 
    
	
Rounding of Strike   Price/Cap Price/Option Entitlement:
    	
 
    	
In connection with any adjustment to the Option   Entitlement, Strike Price or Cap Price, the Option Entitlement, the Strike   Price or the Cap Price, as the case may be, shall be rounded by the   Calculation Agent in accordance with the provisions of the Indenture relating   to rounding of the “Conversion Price” or the “Conversion Rate” as applicable   (each as defined in the Indenture).
    
	
 
    	
 
    	
 
    
	
Number of Shares:
    	
 
    	
As of any date, a number of Shares equal to the   product of the Number of Options and the Option Entitlement.
    
	
 
    	
 
    	
 
    
	
Premium:
    	
 
    	
USD885,150.00
    
	
 
    	
 
    	
 
    
	
Premium Payment Date:
    	
 
    	
The closing date of the issuance of the Convertible   Securities issued pursuant to the option to purchase additional Convertible   Securities exercised on the date hereof.
    
	
 
    	
 
    	
 
    
	
Exchange:
    	
 
    	
The NASDAQ Global Select Market
    
	
 
    	
 
    	
 
    
	
Related Exchange:
    	
 
    	
All Exchanges
    
	
 
    	
 
    	
 
    
	
Procedures for Modified American Exercise:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Exercise Dates:
    	
 
    	
Each Conversion Date.
    
	
 
    	
 
    	
 
    
	
Conversion Date:
    	
 
    	
With respect to any conversion of a Convertible   Security (other than any conversion of Convertible Securities with a   “Conversion Date” (as defined in the Indenture) occurring prior to the Free   Convertibility Date (any such conversion, an “Early   Conversion”), to which the provisions of Section 8(b)(iii) of   this Confirmation shall apply), the “Conversion Date” (as defined in the   Indenture) for Convertible Securities that are not “Relevant Convertible   Securities” under (and as defined in) the confirmation between the parties   hereto regarding the Base Call Option Transaction dated June 6, 2016   (the “Base Call Option Transaction Confirmation”),  
    

 

3

 

	
 
    	
 
    	
provided that, no Conversion   Date shall be deemed to have occurred with respect to Exchanged Securities   (such Convertible Securities, other than Exchanged Securities, the “Relevant Convertible Securities” for such Conversion   Date). For the purposes of determining whether any Convertible Securities   will be Relevant Convertible Securities hereunder or “Relevant Convertible   Securities” under the Base Call Option Transaction Confirmation, Convertible   Securities that are converted pursuant to the Indenture shall be allocated   first to the Base Call Option Transaction Confirmation until all Options   thereunder are exercised or terminated.
    
	
 
    	
 
    	
 
    
	
Free Convertibility   Date:
    	
 
    	
April 15, 2023
    
	
 
    	
 
    	
 
    
	
Exchanged Securities:
    	
 
    	
With respect to any Conversion Date, any Convertible   Securities with respect to which Counterparty makes the election described in   Section 14.13 of the Indenture and the financial institution designated   by Counterparty accepts such Convertible Securities in accordance with   Section 14.13 of the Indenture, as long as Counterparty does not submit   a Notice of Exercise in respect thereof.
    
	
 
    	
 
    	
 
    
	
Expiration Date:
    	
 
    	
The earlier of (i) the last day on which any   Convertible Securities remain outstanding and (ii) the second “Scheduled   Trading Day” (as defined in the Indenture) immediately preceding the   “Maturity Date” (as defined in the Indenture).
    
	
 
    	
 
    	
 
    
	
Automatic Exercise on Conversion   Dates:
    	
 
    	
Applicable; and means that on each Conversion Date   occurring on or after the Free Convertibility Date, a number of Options equal   to the number of Relevant Convertible Securities for such Conversion Date in   denominations of USD1,000 principal amount shall be automatically exercised,   subject to “Notice of Exercise” below.
    
	
 
    	
 
    	
 
    
	
Notice Deadline:
    	
 
    	
In respect of any exercise of Options hereunder on   any Conversion Date on or after the Free Convertibility Date, 5:00 P.M., New   York City time, the “Scheduled Trading Day” (as defined in the Indenture)   immediately preceding the “Maturity Date” (as defined in the Indenture).
    
	
 
    	
 
    	
 
    
	
Notice of Exercise:
    	
 
    	
Counterparty shall notify Dealer in writing prior to   the Notice Deadline of the number of Relevant Convertible Securities in   denominations of USD1,000 principal amount converted on each Conversion Date   occurring on or after the Free Convertibility Date; provided,   that any “Notice of Exercise” delivered to Dealer pursuant to the Base Call   Option Transaction Confirmation shall be deemed to be a Notice of Exercise   pursuant to this Confirmation and the terms of such Notice of Exercise shall   apply, mutatis mutandis, to this 
    

 

4

 

	
 
    	
 
    	
Confirmation. If Counterparty fails to give such   notice when due in respect of any exercise of Options hereunder with a   Conversion Date occurring on or after the Free Convertibility Date, Automatic   Exercise shall apply and the Conversion Date shall be deemed to be the Notice   Deadline.
    
	
 
    	
 
    	
 
    
	
Notice of Final   Convertible Security Settlement Method:
    	
 
    	
In addition to the Notice of Exercise, Counterparty   shall notify Dealer in writing before 5:00 P.M., New York City time, on the   105th “Scheduled Trading Day” (as defined in the   Indenture) immediately preceding the “Maturity Date” (as defined in the   Indenture) of the settlement method (and, if applicable, the “Specified   Dollar Amount” (as defined in the Indenture)) that Counterparty will elect   with respect to Relevant Convertible Securities with a Conversion Date   occurring on or after the Free Convertibility Date (such notice, the “Notice of Final Convertible Security Settlement Method”).   If applicable, the Notice of Final Convertible Security Settlement Method   shall also contain the Settlement Method Election Provisions. If Counterparty   does not timely deliver the Notice of Final Convertible Security Settlement   Method (or such notice does not contain the Settlement Method Election   Provisions, if applicable) then the Notice of Final Convertible Security   Settlement Method shall be deemed timely given and the Applicable Settlement   Method shall be a Cash Election with a “Specified Dollar Amount” (as defined   in the Indenture) of USD1,000 (and, for the avoidance of doubt, the Cash   Settlement Averaging Period shall be determined without regard to the proviso   in the definition thereof), and Counterparty shall not specify “Physical   Settlement” (as defined in the Indenture) or a Cash Election with a “Specified   Dollar Amount” (as defined in the Indenture) of less than USD1,000 for any   Relevant Convertible Securities.
    
	
 
    	
 
    	
 
    
	
Dealer’s Telephone   Number and Telex and/or Facsimile Number and Contact Details for purpose of   Giving Notice:
    	
 
    	
As specified in Section 6(b) below.
    
	
 
    	
 
    	
 
    
	
Settlement   Terms:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Settlement Date:
    	
 
    	
For any Exercise Date, the date one Settlement Cycle   following the final day of the Cash Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Delivery Obligation:
    	
 
    	
In lieu of the obligations set forth in Sections 8.1   and 9.1 of the Equity Definitions, and subject to “Notice of Exercise” above   and “Discretionary Adjustments” and “Consequences of Merger Events” below, in   respect of an Exercise Date, Dealer will deliver to Counterparty on the   related Settlement Date (the 
    

 

5

 

	
 
    	
 
    	
“Delivery Obligation”),   (i) a number of Shares equal to the product of the Applicable Percentage   and the aggregate number of Shares, if any, that Counterparty would be   obligated to deliver to the holder(s) of the Relevant Convertible   Securities for such Conversion Date pursuant to   Section 14.02(a)(iv) of the Indenture (except that such number of   Shares shall be rounded down to the nearest whole number) and cash in lieu of   any fractional Share resulting from such rounding and/or (ii) the   product of the Applicable Percentage and the aggregate amount of cash, if   any, in excess of the principal amount of the Relevant Convertible Securities   that Counterparty would be obligated to deliver to holder(s) of the   Relevant Convertible Securities for such Conversion Date pursuant to Section 14.02(a)(iv) of   the Indenture, determined, for each of clauses (i) and (ii), by the   Calculation Agent (by reference to such Sections of the Indenture) as if   Counterparty had elected to satisfy its conversion obligation in respect of   such Relevant Convertible Securities by the Applicable Settlement Method,   notwithstanding any different actual election by Counterparty with respect to   the settlement of such Relevant Convertible Securities; provided   that if the “Daily VWAP” (as defined in the Indenture) for any “Trading Day”   (as defined in the Indenture) during the Cash Settlement Averaging Period is   greater than the Cap Price, then clause (ii) of the relevant “Daily   Conversion Value” (as defined in the Indenture) for such “Trading Day” shall   be determined as if such “Daily VWAP” for such “Trading Day” were deemed to   equal the Cap Price; provided further   that the Delivery Obligation shall be determined excluding any Shares and/or   cash that Counterparty is obligated to deliver to holder(s) of the   Relevant Convertible Securities as a direct or indirect result of any   adjustments to the Conversion Rate pursuant to a Discretionary Adjustment and   any interest payment that Counterparty is (or would have been) obligated to   deliver to holder(s) of the Relevant Convertible Securities for such   Conversion Date.
    
	
 
    	
 
    	
 
    
	
Applicable Settlement   Method:
    	
 
    	
For any Relevant Convertible Securities, if   (i) Counterparty has notified Dealer in the Notice of Final Convertible   Security Settlement Method that it will elect to satisfy its conversion   obligation in respect of such Relevant Convertible Securities in cash or in a   combination of cash and Shares in accordance with   Section 14.02(a) of the Indenture (a “Cash   Election”) with a “Specified Dollar Amount” (as defined in the   Indenture) of at least USD1,000 and (ii) such Notice of Final   Convertible Security Settlement Method contains all of the Settlement Method   Election Provisions, the Applicable Settlement Method shall be the settlement   method actually so elected by Counterparty in respect of such 
    

 

6

 

	
 
    	
 
    	
Relevant Convertible Securities (the “Convertible Securities Settlement Method”); otherwise, the   Applicable Settlement Method shall assume Counterparty had made a Cash Election   with respect to such Relevant Convertible Securities (a “Deemed Net   Share Election”) with a “Specified Dollar Amount” (as defined in   the Indenture) of USD1,000 per Relevant Convertible Security and the Delivery   Obligation shall be determined by the Calculation Agent as if the relevant   “Observation Period” pursuant to Section 14.02(a)(iv)(C) of the   Indenture were the Cash Settlement Averaging Period.
    
	
 
    	
 
    	
 
    
	
Cash Settlement   Averaging Period:
    	
 
    	
The 50 “Trading Days” (as defined in the Indenture)   commencing on the 52nd “Scheduled Trading Day” (as defined in the Indenture)   prior to the “Maturity Date” (as defined in the Indenture); provided that in the case of a Deemed Net Share Election,   the Cash Settlement Averaging Period shall be the 100 “Trading Days” (as   defined in the Indenture) commencing on the 102nd “Scheduled Trading Day” (as   defined in the Indenture) prior to the “Maturity Date” (as defined in the   Indenture).
    
	
 
    	
 
    	
 
    
	
Settlement Method   Election Provisions:
    	
 
    	
In order for the Applicable Settlement Method to be   the Convertible Securities Settlement Method in accordance with “Applicable   Settlement Method” above, the Notice of Final Convertible Security Settlement   Method must contain in writing the following representations and warranties   from Counterparty to Dealer as of such notice delivery date:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i) Counterparty   is not aware of any material nonpublic information regarding Counterparty or   the Shares;
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii) Counterparty   is electing the Convertible Security Settlement Method in good faith and not   as part of a plan or scheme to evade compliance with the U.S. federal   securities laws; Counterparty is not electing the Convertible Security   Settlement Method for the purpose of creating actual or apparent active   trading activity in the Shares (or any security convertible into or   exchangeable for Shares), raising or depressing or otherwise manipulating the   price of the Shares (or any security convertible into or exchangeable for   Shares), for the purpose of inducing the purchase or sale of the Shares (or   any security convertible into or exchangeable for Shares) or otherwise in   violation of the Exchange Act (it being understood that no representation is   made in respect of Dealer’s Hedging Activities); and Counterparty has not   entered into or altered any hedging transaction relating to the Shares for   the purpose of offsetting the Transaction (other than the repurchase and   retirement of outstanding 
    

 

7

 

	
 
    	
 
    	
convertible notes, and   the offering or repayment of Convertible Securities);
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(iii) Counterparty   has the power to make such election and to execute and deliver any   documentation relating to such election that it is required by this   Confirmation to deliver and to perform its obligations under this   Confirmation and has taken all necessary action to authorize such election,   execution, delivery and performance;
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(iv) such election   and performance of its obligations under this Confirmation do not violate or   conflict with any law applicable to it, any provision of its constitutional   documents, any order or judgment of any court or other agency of government   applicable to it or any of its assets or any contractual restriction binding   on or affecting it or any of its assets, in each case which would materially   impair such election or ability to perform its obligations hereunder; and
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(v) any   transaction that Dealer makes with respect to the Shares during the period   beginning at the time that Counterparty delivers such notice and ending at   the close of business on the final day of the Cash Settlement Averaging   Period shall be made by Dealer at Dealer’s sole discretion for Dealer’s own   account and Counterparty shall not have, and shall not attempt to exercise,   any influence over how, when, whether or at what price Dealer effects such   transactions, including, without limitation, the prices paid or received by   Dealer per Share pursuant to such transactions, or whether such transactions   are made on any securities exchange or privately.
    
	
 
    	
 
    	
 
    
	
Other Applicable   Provisions:
    	
 
    	
To the extent Dealer is obligated to deliver Shares   hereunder, the provisions of Sections 9.8, 9.9 and 9.11 of the Equity   Definitions will be applicable as if “Physical Settlement” applied to the   Transaction; provided that the   Representation and Agreement contained in Section 9.11 of the Equity   Definitions shall be modified by excluding any representations therein   relating to restrictions, obligations, limitations or requirements under   applicable securities laws that exist as a result of the fact that Counterparty   is the issuer of the Shares.
    
	
 
    	
 
    	
 
    
	
Restricted Certificated   Shares:
    	
 
    	
Notwithstanding anything to the contrary in the   Equity Definitions, Dealer may, in whole or in part, deliver Shares required   to be delivered to Counterparty hereunder in certificated form in lieu of   delivery through the Clearance System. With respect to such certificated   Shares, the Representation and Agreement contained in Section 9.11 of   the Equity 
    

 

8

 

	
 
    	
 
    	
Definitions shall be modified by deleting the   remainder of the provision after the word “encumbrance” in the fourth line   thereof.
    
	
 
    	
 
    	
 
    
	
Adjustments:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Method of Adjustment:
    	
 
    	
Notwithstanding Section 11.2 of the Equity   Definitions, upon the occurrence of any event or condition set forth in   Section 14.04 of the Indenture (a “Potential Adjustment   Event”) that the Calculation Agent determines (by reference to   such Section) would result in an adjustment under the Indenture, the   Calculation Agent shall make a corresponding adjustment in respect of any one   or more of the Strike Price, the Number of Options, the Option Entitlement   and any other term relevant to the exercise, settlement or payment of the   Transaction, subject to “Discretionary Adjustments” below. Immediately upon   the occurrence of any Potential Adjustment Event, Counterparty shall notify   the Calculation Agent of such Potential Adjustment Event; and once the   adjustments to be made to the terms of the Indenture and the Convertible   Securities in respect of such Potential Adjustment Event have been   determined, Counterparty shall immediately notify the Calculation Agent in   writing of the details of such adjustments.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
For the avoidance of doubt, Dealer shall not have   any payment or delivery obligation hereunder in respect of, and no adjustment   shall be made to the terms of the Transaction on account of, (x) any   distribution of cash, property or securities by Counterparty to the holders   of Convertible Securities (upon conversion or otherwise) or (y) any   other transaction in which holders of Convertible Securities are entitled to   participate, in each case, in lieu of an adjustment under the Indenture in   respect of a Potential Adjustment Event (including, without limitation, under   the fourth sentence of Section 14.04(c) of the Indenture or the   fourth sentence of Section 14.04(d) of the Indenture).
    
	
 
    	
 
    	
 
    
	
Discretionary   Adjustments:
    	
 
    	
Notwithstanding anything to the contrary herein or   in the Equity Definitions, if the Calculation Agent in good faith disagrees with   any adjustment under the Indenture that involves an exercise of discretion by   Counterparty or its board of directors (including, without limitation,   pursuant to Section 14.05 of the Indenture or pursuant to   Section 14.07 of the Indenture or any supplemental indenture entered   into thereunder (a “Merger Supplemental   Indenture”) or in connection with the determination of the fair   value of any securities, property, rights or other assets), then the   Calculation Agent will determine the adjustment to be made to any one or more   of the Strike Price, Number of Options, Option Entitlement and any other   variable relevant to the exercise, 
    

 

9

 

	
 
    	
 
    	
settlement or payment of or under the Transaction and,   for the avoidance of doubt, the Delivery Obligation shall be calculated on   the basis of such adjustments by the Calculation Agent.
    
	
 
    	
 
    	
 
    
	
Extraordinary   Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Merger Events:
    	
 
    	
Notwithstanding Section 12.1(b) of the   Equity Definitions, “Merger Event” shall mean “Share Exchange Event” as set   forth in Section 14.07 of the Indenture.
    
	
 
    	
 
    	
 
    
	
Consequences of Merger   Events:
    	
 
    	
Notwithstanding Section 12.2 of the Equity   Definitions, upon the occurrence of a Merger Event, the Calculation Agent   shall make an adjustment to the terms relevant to the exercise, settlement or   payment of the Transaction corresponding to the adjustment required under   Section 14.07 of the Indenture in respect of such Merger Event, as   determined by the Calculation Agent (by reference to such Section), subject   to “Discretionary Adjustments” above; provided that   such adjustment shall be made without regard to any adjustment to the   Conversion Rate pursuant to a Fundamental Change Adjustment or a   Discretionary Adjustment; and provided further   that if, with respect to a Merger Event, (i) the consideration for the   Shares includes (or, at the option of a holder of Shares, may include) shares   of an entity or person not organized under the laws of the United States, any   state thereof or the District of Columbia or (ii) the Counterparty to   the Transaction, following such Merger Event, will not be a corporation or   will not be the Issuer, Dealer may elect in its sole discretion that   notwithstanding Section 12.7 of the Equity Definitions, that such event   shall constitute an Additional Termination Event with respect to which the   Transaction is the sole Affected Transaction and Counterparty is the sole   Affected Party, and Dealer shall be the party entitled to designate an Early   Termination Date pursuant to Section 6(b) of the Agreement and to   determine the amount payable pursuant to Section 6(e) of the Agreement.   For the avoidance of doubt, adjustments shall be made pursuant to the   provisions set forth above regardless of whether any Merger Event gives rise   to an Early Conversion.
    
	
 
    	
 
    	
 
    
	
Notice of Merger   Consideration and Consequences:
    	
 
    	
Upon the occurrence of a Merger Event, Counterparty   shall reasonably promptly (but in any event prior to the relevant merger   date) notify the Calculation Agent of (i) in the case of a Merger Event   that causes the Shares to be converted into the right to receive more than a   single type of consideration (determined based in part upon any form of   stockholder election), (a) if holders of a majority of Shares   affirmatively make such an
    

 

10

 

	
 
    	
 
    	
election, the weighted average of the types and   amounts of consideration to be received by the holders of Shares that   affirmatively make such an election or (b) if holders of less than a   majority of Shares affirmatively make such an election, the types and amount   of consideration actually received by such holders, and (ii) the details   of the adjustment to be made under the Indenture in respect of such Merger   Event.
    
	
 
    	
 
    	
 
    
	
Consequences of   Announcement Events:
    	
 
    	
Modified Calculation Agent Adjustment as set forth   in Section 12.3(d) of the Equity Definitions; provided   that, in respect of an Announcement Event, (x) references to “Tender   Offer” shall be replaced by references to “Announcement Event” and references   to “Tender Offer Date” shall be replaced by references to “date of such   Announcement Event”, (y) the word “shall” in the second line shall be   replaced with “may”, the phrase “exercise, settlement, payment or any other   terms of the Transaction (including, without limitation, the spread)” shall   be replaced with the phrase “Cap Price (provided that in no event shall the   Cap Price be less than the Strike Price)” and the fifth and sixth lines shall   be deleted in their entirety and replaced with the words “effect on the   embedded call options with an exercise price equal to the Cap Price sold by   Counterparty to Dealer of such Announcement Event solely to account for   changes in volatility, expected dividends, stock loan rate or liquidity   relevant to the Shares or such embedded call options”, and (z) for the   avoidance of doubt, the Calculation Agent may determine whether the relevant   Announcement Event has had an effect on the embedded call options with an   exercise price equal to the Cap Price sold by Counterparty to Dealer of such   Announcement Event solely in respect of changes in volatility, expected   dividends, stock loan rate or liquidity relevant to the Shares or such   embedded call options (and, if so, may adjust the Cap Price accordingly) on   one or more occasions on or after the date of the Announcement Event up to,   and including, the Expiration Date, any Early Termination Date and/or any   other date of cancellation, it being understood that any adjustment in   respect of an Announcement Event shall take into account any earlier   adjustment relating to the same Announcement Event. An Announcement Event   shall be an “Extraordinary Event” for purposes of the Equity Definitions, to   which Article 12 of the Equity Definitions is applicable.   Section 12.3(d) of the Equity Definitions is hereby modified by   deleting the text beginning “ “Cancellation ....” on the 11th line thereof through the end of the   paragraph and inserting “such event shall constitute an Additional   Termination Event with respect to which the Transaction is the sole Affected   Transaction and 
    

 

11

 

	
 
    	
 
    	
Counterparty is the sole Affected Party, and Dealer   shall be the party entitled to designate an Early Termination Date pursuant   to Section 6(b) of the Agreement and to determine the amount   payable pursuant to Section 6(e) of the Agreement.”
    
	
 
    	
 
    	
 
    
	
Announcement Event:
    	
 
    	
(i) The public announcement by any third party   reasonably capable of executing the Merger Event of a firm intention (or in   the case of the Issuer or its affiliates, any public announcement) of   (x) any transaction or event that, if completed, would constitute a   Merger Event or Tender Offer, (y) any potential acquisition by Issuer   and/or its subsidiaries where the aggregate consideration exceeds 15% of the   market capitalization of Issuer as of the date of such announcement (an “Acquisition Transaction”) or (z) the intention to   enter into a Merger Event or Tender Offer or an Acquisition Transaction,   (ii) the public announcement by Issuer of an intention to solicit or   enter into, or to explore strategic alternatives or other similar undertaking   that may include, a Merger Event or Tender Offer or an Acquisition   Transaction or (iii) any subsequent public announcement by any entity of   a change to a transaction or intention that is the subject of an announcement   of the type described in clause (i) or (ii) of this sentence   (including, without limitation, a new announcement, whether or not by the   same party, relating to such a transaction or intention or the announcement   of a withdrawal from, or the abandonment or discontinuation of, such a   transaction or intention), as determined by the Calculation Agent. For the   avoidance of doubt, the occurrence of an Announcement Event with respect to   any transaction or intention shall not preclude the occurrence of a later   Announcement Event with respect to such transaction or intention. For   purposes of this definition of “Announcement Event,” (A) “Merger Event”   shall mean such term as defined under Section 12.1(b) of the Equity   Definitions (but, for the avoidance of doubt, the remainder of the definition   of “Merger Event” in Section 12.1(b) of the Equity Definitions   following the definition of “Reverse Merger” therein shall be disregarded)   and (B) “Tender Offer” shall mean such term as defined under   Section 12.1(d) of the Equity Definitions.
    
	
 
    	
 
    	
 
    
	
Nationalization, Insolvency   or Delisting:
    	
 
    	
Cancellation and Payment, provided   that, notwithstanding Section 12.7 of the Equity Definitions,   such event shall constitute an Additional Termination Event with respect to   which the Transaction is the sole Affected Transaction and Counterparty is   the sole Affected Party, and Dealer shall be the party entitled to designate   an Early Termination Date pursuant to Section 6(b) of the Agreement   and to determine the amount payable 
    

 

12

 

	
 
    	
 
    	
pursuant to Section 6(e) of the Agreement;   provided further that in addition to   the provisions of Section 12.6(a)(iii) of the Equity Definitions,   it will also constitute a Delisting if the Shares are not immediately re-listed,   re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ   Global Select Market or The NASDAQ Global Market (or their respective   successors); if the Shares are immediately re-listed, re-traded or re-quoted   on any such exchange or quotation system, such exchange or quotation system   shall thereafter be deemed to be the Exchange.
    
	
 
    	
 
    	
 
    
	
Additional Termination   Event(s):
    	
 
    	
Notwithstanding anything to the contrary in the   Equity Definitions, if, as a result of an Extraordinary Event, the Transaction   would be cancelled or terminated (whether in whole or in part) pursuant to   Article 12 of the Equity Definitions, an Additional Termination Event   (with the Transaction (or the cancelled or terminated portion thereof) being   the Affected Transaction and Counterparty being the sole Affected Party)   shall be deemed to occur, and, in lieu of Sections 12.7, 12.8 and 12.9 of the   Equity Definitions, Section 6 of the Agreement shall apply to such   Affected Transaction.
    
	
 
    	
 
    	
 
    
	
Additional Disruption   Events:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(a)   Change   in Law:
    	
 
    	
Applicable; provided that   Section 12.9(a)(ii) of the Equity Definitions is hereby amended by   (i) replacing the phrase “the interpretation” in the third line thereof   with the phrase “, or public announcement of, the formal or informal   interpretation”, (ii) by adding the phrase “and/or Hedge Position” after   the word “Shares” in clause (X) thereof and (iii) by immediately   following the word “Transaction” in clause (X) thereof, adding the   phrase “in the manner contemplated by the Hedging Party on the Trade Date”;   and provided further that   Section 12.9(a)(ii) of the Equity Definitions is hereby amended by   (i) replacing the parenthetical beginning after the word “regulation” in   the second line thereof the words “(including, for the avoidance of doubt and   without limitation, (x) any tax law or (y) adoption or promulgation   of new regulations authorized or mandated by existing statute)” and   (ii) adding the words “, or holding, acquiring or disposing of Shares or   any Hedge Positions relating to,” after the words “obligations under” in   clause (Y) thereof.
    
	
 
    	
 
    	
 
    
	
(b)   Failure   to Deliver:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(c)   Insolvency   Filing:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
(d)   Hedging   Disruption:
    	
 
    	
Applicable; provided   that:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(i) Section 12.9(a)(v) of the Equity   Definitions is hereby amended by (a) inserting the following words at   the end of clause (A) thereof: “in the manner 
    

 

13

 

	
 
    	
 
    	
contemplated by the Hedging Party on the Trade Date”   and (b) inserting the following sentence at the end of such Section:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
“For the avoidance of doubt, (i) the term   “equity price risk” shall be deemed to include, but shall not be limited to,   stock price and volatility risk, and (ii) the transactions or assets   referred to in phrases (A) or (B) above must be available on   commercially reasonable pricing and other terms.”; and
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
(ii) Section 12.9(b)(iii) of the   Equity Definitions is hereby amended by inserting in the third line thereof,   after the words “to terminate the Transaction”, the words “or a portion of   the Transaction affected by such Hedging Disruption”.
    
	
 
    	
 
    	
 
    
	
(e)   Increased   Cost of Hedging:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Hedging Party:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
Determining Party:
    	
 
    	
Dealer
    
	
 
    	
 
    	
 
    
	
Non-Reliance:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Agreements and   Acknowledgments Regarding Hedging Activities:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Additional   Acknowledgments:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
3.   Calculation   Agent:
    	
 
    	
Dealer. All calculations and determinations by the   Calculation Agent shall be made in good faith and in a commercially   reasonable manner provided, that if an Event of Default occurs with respect   to Dealer, Counterparty shall have the right to appoint a successor   calculation agent which shall be a nationally recognized third-party dealer   in over-the-counter corporate equity derivatives. Calculation Agent agrees   that it will promptly, upon written notice from Counterparty, provide a   statement displaying in reasonable detail the basis for such determination or   calculation, as the case may be (it being understood that the Calculation   Agent shall not be required to disclose any confidential information or   proprietary models used by it in connection with such determination or   calculation, as the case may be) and make available appropriate employees or   agents of the Dealer to explain the information provided pursuant to the   foregoing.
    
	
 
    	
 
    	
 
    
	
4.   Account   Details:
    	
 
    	
 
    

 

Dealer Payment Instructions:

[·]

[·]

SWIFT: [·]

Bank Routing: [·]

Account Name: [·]

Account No.: [·]

 

14

 

Counterparty Payment Instructions:

 

To be provided by Counterparty.

 

5.              Offices:

 

The Office of Dealer for the Transaction is: New York

 

The Office of Counterparty for the Transaction is:

 

Inapplicable, Counterparty is not a Multibranch Party

 

6.              Notices: For purposes of this Confirmation:

 

(a)                                 Address for notices or communications to Counterparty:

 

	
To:
    	
The Medicines Company
    
	
 
    	
8 Sylvan Way
    
	
 
    	
Parsippany, New Jersey 07054
    
	
Attn:
    	
William B. O’Connor, Chief Financial Officer
    
	
Telephone:
    	
973-290-6094
    
	
Email:
    	
Bill.O’Connor@THEMEDCO.com
    

 

(b)                                 Address for notices or communications to Dealer:

 

	
To:
    	
Bank of America, N.A.
    
	
 
    	
c/o Merrill Lynch,   Pierce, Fenner & Smith Incorporated
    
	
 
    	
One Bryant Park
    
	
 
    	
New York, NY 10036
    
	
Attn:
    	
Gary Rosenblum
    
	
Telephone:
    	
646-855-3684
    
	
Email:
    	
gary.rosenblum@bankofamerica.com
    
	
 
    	
 
    
	
With a copy to:
    	
 
    
	
 
    	
 
    
	
Attn:
    	
Geoff George
    
	
Telephone:
    	
646-855-9905
    
	
Facsimile:
    	
212-230-8325
    
	
Email:
    	
geoffrey.f.george@baml.com
    

 

7.              Representations, Warranties and Agreements:

 

(a)                                 In addition to the representations and warranties in the Agreement and those contained elsewhere herein, Counterparty represents and warrants to and for the benefit of, and agrees with, Dealer as follows:

 

(i)                                     On the Trade Date and as of the date of any Notice of Share Termination under (and as defined in) Section 8(c) below, (A) Counterparty is not aware of any material nonpublic information regarding Counterparty or the Shares and (B) all reports and other documents filed by Counterparty with the Securities and Exchange Commission pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”) when considered as a whole (with the more recent such reports and documents deemed to amend inconsistent statements contained in any earlier such reports and documents), do not contain any untrue statement of a material fact or any omission of a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances in which they were made, not misleading.

 

(ii)                                  (A) On the Trade Date, the Shares or securities that are convertible into, or exchangeable or exercisable for Shares, are not subject to a “restricted period” and are not “covered securities” as such terms are defined in Regulation M under the Exchange Act (“Regulation M”) and (B) Counterparty shall not engage in any “distribution,” as such term is defined in Regulation M, other than a distribution meeting the requirements of the exceptions set

 

15

 

forth in sections 101(b)(10) and 102(b)(7) of Regulation M, until the second Exchange Business Day immediately following the Trade Date.

 

(iii)                               Without limiting the generality of Section 13.1 of the Equity Definitions, Counterparty acknowledges that neither Dealer nor any of its affiliates is making any representations or warranties or taking any position or expressing any view with respect to the treatment of the Transaction under any accounting standards including ASC Topic 260, Earnings Per Share, ASC Topic 815, Derivatives and Hedging, or ASC Topic 480, Distinguishing Liabilities from Equity and ASC 815-40, Derivatives and Hedging — Contracts in Entity’s Own Equity (or any successor issue statements).

 

(iv)                              Without limiting the generality of Section 3(a)(iii) of the Agreement, the Transaction will not violate Rule 13e-1 or Rule 13e-4 under the Exchange Act.

 

(v)                                 Prior to the Trade Date, Counterparty shall deliver to Dealer a resolution of Counterparty’s board of directors authorizing the Transaction, and approving the Transaction and any related hedging activity for purposes of Section 203 of the Delaware General Corporation Law, and such other certificate or certificates as Dealer shall reasonably request.

 

(vi)                              Counterparty is not entering into this Confirmation for the purpose of creating actual or apparent trading activity in the Shares (or any security convertible into or exchangeable for Shares) or raising or depressing or otherwise manipulating the price of the Shares (or any security convertible into or exchangeable for Shares), for the purpose of inducing the purchase or sale of the Shares (or any security convertible into or exchangeable for Shares) or otherwise in violation of the Exchange Act, it being understood that no representation is made in respect of Dealer’s Hedging Activities.

 

(vii)                        Counterparty is not, and after giving effect to the transactions contemplated hereby will not be, required to register as, an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

 

(viii)                        On each of the Trade Date and the Premium Payment Date, Counterparty is not “insolvent” (as such term is defined under Section 101(32) of the U.S. Bankruptcy Code (Title 11 of the United States Code) (the “Bankruptcy Code”)) and Counterparty would be able to purchase the Number of Shares in compliance with the laws of the jurisdiction of Counterparty’s incorporation.

 

(ix)                              No state or local (including non-U.S. jurisdictions) law, rule, regulation or regulatory order applicable to the Shares would give rise to any reporting, consent, registration or other requirement (including without limitation a requirement to obtain prior approval from any person or entity) as a result of Dealer or its affiliates owning or holding (however defined) Shares.

 

(x)                                 Counterparty (A) is capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities; (B) will exercise independent judgment in evaluating the recommendations of any broker-dealer or its associated persons, unless it has otherwise notified the broker-dealer in writing; and (C) has total assets of at least USD50 million.

 

(b)                                 Each of Dealer and Counterparty agrees and represents that it is an “eligible contract participant” as defined in Section 1a(18) of the U.S. Commodity Exchange Act, as amended, and is entering into the Transaction as principal (and not as agent or in any other capacity, fiduciary or otherwise) and not for the benefit of any third party.

 

(c)                                  Each of Dealer and Counterparty acknowledges that the offer and sale of the Transaction to it is intended to be exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section 4(a)(2) thereof.  Accordingly, Counterparty represents and warrants to Dealer that (i) it has the financial ability to bear the economic risk of its investment in the Transaction and is able to bear a total loss of its investment and its investments in and liabilities in respect of the Transaction, which it understands are not readily marketable, are not disproportionate to its net worth, and it is able to bear any loss in connection with the Transaction, including the loss of its entire investment in the Transaction, (ii) it is an “accredited investor” as that term is defined in Regulation D as promulgated

 

16

 

under the Securities Act, (iii) it is entering into the Transaction for its own account and without a view to the distribution or resale thereof, (iv) the assignment, transfer or other disposition of the Transaction has not been and will not be registered under the Securities Act and is restricted under this Confirmation, the Securities Act and state securities laws, and (v) its financial condition is such that it has no need for liquidity with respect to its investment in the Transaction and no need to dispose of any portion thereof to satisfy any existing or contemplated undertaking or indebtedness and is capable of assessing the merits of and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks of the Transaction.

 

(d)                                 Each of Dealer and Counterparty agrees and acknowledges that Dealer is a “financial institution” and “financial participant” within the meaning of Sections 101(22) and 101(22A) of the Bankruptcy Code.  The parties hereto further agree and acknowledge (A) that this Confirmation is a “securities contract,” as such term is defined in Section 741(7) of the Bankruptcy Code, with respect to which each payment and delivery hereunder or in connection herewith is a “termination value,” “payment amount” or “other transfer obligation” within the meaning of Section 362 of the Bankruptcy Code and a “settlement payment” within the meaning of Section 546 of the Bankruptcy Code, and (B) that Dealer is entitled to the protections afforded by, among other sections, Sections 362(b)(6), 362(b)(27), 362(o), 546(e), 546(j), 548(d)(2), 555 and 561 of the Bankruptcy Code.

 

(e)                                  As a condition to the effectiveness of the Transaction, Counterparty shall deliver to Dealer (i) an incumbency certificate, dated as of the Premium Payment Date, of Counterparty in customary form and (ii) an opinion of counsel, dated as of the Premium Payment Date and reasonably acceptable to Dealer, in the form of Exhibit A attached hereto.

 

(f)                                   Counterparty understands that notwithstanding any other relationship between Counterparty and Dealer and its affiliates, in connection with this Transaction and any other over-the-counter derivative transactions between Counterparty and Dealer or its affiliates, Dealer or its affiliates is acting as principal and is not a fiduciary or advisor in respect of any such transaction, including any entry, exercise, amendment, unwind or termination thereof.

 

(g)                                  Counterparty represents and warrants that it has received, read and understands the OTC Options Risk Disclosure Statement and a copy of the most recent disclosure pamphlet prepared by The Options Clearing Corporation entitled “Characteristics and Risks of Standardized Options”.

 

(h)                                 Each party acknowledges and agrees to be bound by the Conduct Rules of the Financial Industry Regulatory Authority, Inc. applicable to transactions in options, and further agrees not to violate the position and exercise limits set forth therein.

 

8.              Other Provisions:

 

(a)                                 Right to Extend.  Dealer may postpone or add, in whole or in part, any Exercise Date or Settlement Date or any other date of valuation or delivery by Dealer, with respect to some or all of the relevant Options (in which event the Calculation Agent shall make appropriate adjustments to the Delivery Obligation), if Dealer determines, in its commercially reasonable discretion, that such extension is reasonably necessary to preserve Dealer’s commercially reasonable hedging or hedge unwind activity hereunder in light of existing liquidity conditions in the cash market, the stock borrow market or other relevant market or to enable Dealer to effect purchases of Shares or Share Termination Delivery Units in connection with its commercially reasonable hedging, hedge unwind or settlement activity hereunder in a manner that would, if Dealer were Counterparty or an affiliated purchaser of Counterparty, be in compliance with applicable legal, regulatory or self-regulatory requirements, or with related policies and procedures (consistently applied to transactions similar to the Transaction and whether or not such requirements, policies or procedures are imposed by law or have been voluntarily adopted by Dealer).

 

17

 

(b)                                 Additional Termination Events.

 

(i)                                     The occurrence of an event of default with respect to Counterparty under the terms of the Convertible Securities on the Maturity Date thereof or which default has resulted in the Convertible Securities becoming due and payable under the Indenture as set forth in Section 6.02 of the Indenture shall constitute an Additional Termination Event with respect to which the Transaction is the sole Affected Transaction and Counterparty is the sole Affected Party, and Dealer shall be the party entitled to designate an Early Termination Date pursuant to Section 6(b) of the Agreement and to determine the amount payable pursuant to Section 6(e) of the Agreement.

 

(ii)                                  Promptly following any repurchase and cancellation of Convertible Securities, including without limitation pursuant to Article 15 of the Indenture in connection with a “Fundamental Change” (as defined in the Indenture), Counterparty shall notify Dealer in writing of such repurchase and cancellation and the number of Convertible Securities so repurchased and cancelled (any such notice, a “Repurchase Notice”). Notwithstanding anything to the contrary in this Confirmation, the receipt by Dealer from Counterparty of (x) any Repurchase Notice, within the applicable time period set forth in the preceding sentence, and (y) a written representation and warranty by Counterparty that, as of the date of such Repurchase Notice, Counterparty is not in possession of any material nonpublic information regarding Counterparty or the Shares, shall constitute an Additional Termination Event as provided in this Section 8(b)(ii). Upon receipt of any such Repurchase Notice and the related written representation and warranty, Dealer shall promptly designate an Exchange Business Day following receipt of such Repurchase Notice (which in no event shall be earlier than the related settlement date for such Convertible Securities) as an Early Termination Date with respect to the portion of this Transaction corresponding to a number of Options (the “Repurchase Options”) equal to the lesser of (A) the number of such Convertible Securities specified in such Repurchase Notice minus the number of “Repurchase Options” (as defined in the Base Call Option Transaction Confirmation) and (B) the Number of Options as of the date Dealer designates such Early Termination Date and, as of such date, the Number of Options shall be reduced by the number of Repurchase Options. Any payment hereunder with respect to such termination shall be calculated pursuant to Section 6 of the Agreement as if (1) an Early Termination Date had been designated in respect of a Transaction having terms identical to this Transaction and a Number of Options equal to the number of Repurchase Options, (2) Counterparty were the sole Affected Party with respect to such Additional Termination Event and (3) the terminated portion of the Transaction were the sole Affected Transaction.

 

(iii)                               Notwithstanding anything to the contrary in this Confirmation, upon any Early Conversion in respect of which the relevant converting Holder has satisfied the requirements to conversion set forth in Section 14.02(b) of the Indenture:

 

(A)       Counterparty shall, within one Scheduled Trading Day of the “Conversion Date” (as defined in the Indenture) for such Early Conversion, provide written notice (an “Early Conversion Notice”) to Dealer specifying the number of Convertible Securities surrendered for conversion on such Conversion Date (such Convertible Securities, the “Affected Convertible Securities”), and the giving of such Early Conversion Notice shall constitute an Additional Termination Event as provided in this Section 8(b)(iii);

 

(B)       upon receipt of any such Early Conversion Notice, within a commercially reasonable period of time thereafter, Dealer shall designate an Exchange Business Day as an Early Termination Date (which Exchange Business Day shall be no earlier than one Scheduled Trading Day following the “Conversion Date” (as defined in the Indenture) for such Early Conversion) with respect to the portion of the Transaction corresponding to a number of Options (the “Affected Number of Options”) equal to the lesser of (x) the

 

18

 

number of Affected Convertible Securities minus the “Affected Number of Options” (as defined in the Base Call Option Transaction Confirmation), if any, that relate to such Affected Convertible Securities and (y) the Number of Options as of the “Conversion Date” (as defined in the Indenture) for such Early Conversion;

 

(C)       any payment hereunder with respect to such termination shall be calculated by the Calculation Agent pursuant to Section 6 of the Agreement as if (x) an Early Termination Date had been designated in respect of a Transaction having terms identical to the Transaction and a Number of Options equal to the Affected Number of Options, (y) Counterparty were the sole Affected Party with respect to such Additional Termination Event and (z) the terminated portion of the Transaction were the sole Affected Transaction; provided that the amount payable with respect to such termination shall not be greater than (1) the Applicable Percentage, multiplied by (2) the Affected Number of Options, multiplied by (3) (x) the sum of (i) the amount of cash paid (if any) and (ii) the number of Shares delivered (if any) to the Holder (as such term is defined in the Indenture) of an Affected Convertible Security upon conversion of such Affected Convertible Security, multiplied by the fair market value of one Share as determined by the Calculation Agent, minus (y) USD 1,000;

 

(D)       for the avoidance of doubt, in determining the amount payable in respect of such Affected Transaction pursuant to Section 6 of the Agreement, the Calculation Agent shall assume that (x) the relevant Early Conversion and any conversions, adjustments, agreements, payments, deliveries or acquisitions by or on behalf of Counterparty leading thereto had not occurred, (y) no adjustment to the conversion rate for the Convertible Securities has occurred pursuant to any Fundamental Change Adjustment or Discretionary Adjustment and (z) the corresponding Convertible Securities remain outstanding; and

 

(E)        the Transaction shall remain in full force and effect, except that, as of the “Conversion Date” (as defined in the Indenture) for such Early Conversion, the Number of Options shall be reduced by the Affected Number of Options.

 

(c)                                  Alternative Calculations and Payment on Early Termination and on Certain Extraordinary Events.  If Dealer shall owe Counterparty any amount pursuant to Section 6(d)(ii) of the Agreement (a “Payment Obligation”), Counterparty shall have the right, in its sole discretion, to require Dealer to satisfy any such Payment Obligation by the Share Termination Alternative (as defined below) by giving irrevocable telephonic notice to Dealer, confirmed in writing within one Scheduled Trading Day (which written confirmation shall contain the representation and warranty set forth in Section 7(a)(i)), no later than 9:30 A.M., New York City time, on the relevant merger date, Announcement Date, Early Termination Date or date of cancellation or termination in respect of an Extraordinary Event, as applicable (“Notice of Share Termination”); provided that if Counterparty does not elect to require Dealer to satisfy its Payment Obligation by the Share Termination Alternative, Dealer shall have the right, in its sole discretion, to elect to satisfy its Payment Obligation by the Share Termination Alternative, notwithstanding Counterparty’s failure to elect or election to the contrary; and provided further that Counterparty shall not have the right to so elect (but, for the avoidance of doubt, Dealer shall have the right to so elect) in the event of (i) an Insolvency, a Nationalization or a Merger Event, in each case, in which the consideration or proceeds to be paid to holders of Shares consists solely of cash or (ii) an Event of Default in which Counterparty is the Defaulting Party or a Termination Event in which Counterparty is the Affected Party or an Extraordinary Event, which Event of Default, Termination Event or Extraordinary Event resulted from an event or events within Counterparty’s control.  Upon such Notice of Share Termination, the following provisions shall apply on the Scheduled Trading Day immediately following the relevant merger date,

 

19

 

Announcement Date, Early Termination Date or date of cancellation or termination in respect of an Extraordinary Event, as applicable:

 

	
Share Termination Alternative:
    	
 
    	
If applicable, means that Dealer shall deliver to   Counterparty the Share Termination Delivery Property on the date on which the   Payment Obligation would otherwise be due pursuant to   Section 6(d)(ii) of the Agreement or such later date or dates as   Dealer may commercially reasonably determine (the “Share   Termination Payment Date”) taking into account commercially   reasonable hedging or hedge unwind activity, in satisfaction of the Payment   Obligation.
    
	
 
    	
 
    	
 
    
	
Share Termination Delivery Property:
    	
 
    	
A number of Share Termination Delivery Units, as   calculated by the Calculation Agent, equal to the Payment Obligation divided   by the Share Termination Unit Price. The Calculation Agent shall adjust the   Share Termination Delivery Property by replacing any fractional portion of   the aggregate amount of a security therein with an amount of cash equal to   the value of such fractional security based on the values used to calculate   the Share Termination Unit Price.
    
	
 
    	
 
    	
 
    
	
Share Termination Unit Price:
    	
 
    	
The value of property contained in one Share   Termination Delivery Unit on the date such Share Termination Delivery Units   are to be delivered as Share Termination Delivery Property, as determined by   the Calculation Agent and notified by the Calculation Agent to Dealer at the   time of notification of the Payment Obligation.
    
	
 
    	
 
    	
 
    
	
Share Termination Delivery Unit:
    	
 
    	
In the case of a Termination Event (other than on   account of an Insolvency, Nationalization or Merger Event), Event of Default,   Delisting or Additional Disruption Event, one Share or, in the case of an   Insolvency, Nationalization or Merger Event, one Share or a unit consisting   of the number or amount of each type of property received by a holder of one   Share (without consideration of any requirement to pay cash or other   consideration in lieu of fractional amounts of any securities) in such   Insolvency, Nationalization or Merger Event, as applicable. If such   Insolvency, Nationalization or Merger Event involves a choice of   consideration to be received by holders, such holder shall be deemed to have   elected to receive the maximum possible amount of cash.
    
	
 
    	
 
    	
 
    
	
Failure to Deliver:
    	
 
    	
Applicable
    
	
 
    	
 
    	
 
    
	
Other Applicable Provisions:
    	
 
    	
If Share Termination Alternative is applicable, the   provisions of Sections 9.8, 9.9 and 9.11 of the Equity Definitions will be   applicable as if “Physical Settlement” applied to the Transaction, except   that all references to “Shares” shall be read as references to “Share   Termination Delivery Units”; provided that   the Representation and Agreement contained in Section 9.11 of the Equity   Definitions shall be modified by excluding any representations therein   relating to restrictions, obligations, limitations or requirements under   applicable securities laws as a result of the fact that Counterparty is the   issuer of any Share Termination Delivery Units (or any part thereof).
    

 

20

 

(d)                                 Disposition of Hedge Shares.  Counterparty hereby agrees that if, in the good faith reasonable judgment of Dealer, the Shares (the “Hedge Shares”) acquired by Dealer for the purpose of hedging its obligations pursuant to the Transaction in a commercially reasonable manner cannot be sold in the U.S. public market by Dealer without registration under the Securities Act, Counterparty shall, at its election: (i) in order to allow Dealer to sell the Hedge Shares in a registered offering, make available to Dealer an effective registration statement under the Securities Act to cover the resale of such Hedge Shares and (A) enter into an agreement, in form and substance satisfactory to Dealer, substantially in the form of an underwriting agreement for a registered offering, (B) provide accountant’s “comfort” letters in customary form for registered offerings of equity securities, (C) provide disclosure opinions of nationally recognized outside counsel to Counterparty reasonably acceptable to Dealer, (D) provide other customary opinions, certificates and closing documents customary in form for registered offerings of equity securities and (E) afford Dealer a reasonable opportunity to conduct a “due diligence” investigation with respect to Counterparty customary in scope for underwritten offerings of equity securities; provided that if Counterparty elects clause (i) above but the items referred to therein are not completed in a timely manner, or if Dealer, in its sole discretion, is not satisfied with access to due diligence materials, the results of its due diligence investigation, or the procedures and documentation for the registered offering referred to above, then clause (ii) or clause (iii) of this Section 8(d) shall apply at the election of Counterparty; (ii) in order to allow Dealer to sell the Hedge Shares in a private placement, enter into a private placement agreement substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance satisfactory to Dealer, including customary representations, covenants, blue sky and other governmental filings and/or registrations, indemnities to Dealer, due diligence rights (for Dealer or any designated buyer of the Hedge Shares from Dealer), and best efforts obligations to provide opinions and certificates and such other documentation as is customary for private placements agreements, all commercially reasonably acceptable to Dealer (in which case, the Calculation Agent shall make any adjustments to the terms of the Transaction that are necessary to compensate Dealer for any commercially reasonable discount from the public market price of the Shares incurred on the sale of Hedge Shares in a private placement); or (iii) purchase the Hedge Shares from Dealer at the “Daily VWAP” (as defined in the Indenture) on such Exchange Business Days, and in the amounts, commercially reasonably requested by Dealer.  This Section 8(d) shall survive the termination, expiration or early unwind of the Transaction.

 

(e)                                  Repurchase and Conversion Rate Adjustment Notices.  Counterparty shall, at least two Exchange Business Days prior to any day on which Counterparty effects any repurchase of Shares or consummates or otherwise engages in any transaction or event (a “Conversion Rate Adjustment Event”) that could reasonably be expected to lead to an increase in the “Conversion Rate” (as defined in the Indenture), give Dealer a written notice of such repurchase or Conversion Rate Adjustment Event (a “Repurchase Notice”) on such day if, following such repurchase or Conversion Rate Adjustment Event, the Notice Percentage would reasonably be expected to be (i) greater than 6.36% and (ii) greater by 0.5% than the Notice Percentage included in the immediately preceding Repurchase Notice (or, in the case of the first such Repurchase Notice, greater than the Notice Percentage as of the date hereof).  The “Notice Percentage” as of any day is the fraction, expressed as a percentage, the numerator of which is the Number of Shares plus the number of Shares underlying any other convertible bond hedge transactions or similar call options sold by Dealer to Counterparty and the denominator of which is the number of Shares outstanding on such day.  In the event that Counterparty fails to provide Dealer with a Repurchase Notice on the day and in the manner specified in this Section 8(e) then Counterparty agrees to indemnify and hold harmless Dealer, its affiliates and their respective directors, officers, employees, agents and controlling persons (Dealer and each such person being an “Indemnified Party”) from and against any and all losses (including losses relating to the Dealer’s hedging activities as a consequence of becoming, or of the risk of becoming, a Section 16 “insider”, including without limitation, any forbearance from hedging activities or cessation of hedging activities and any losses in connection therewith with respect to this Transaction), claims, damages and liabilities (or actions in respect thereof), joint or several, to which such Indemnified Party may become subject under applicable securities laws, including without limitation, Section 16 of the Exchange Act or under any state or federal law, regulation or regulatory order, relating to or arising out of such failure.  If for any reason the foregoing indemnification is unavailable to any Indemnified Party or insufficient to hold harmless any Indemnified Party, then Counterparty shall contribute, to the maximum extent permitted by law, to the amount paid or payable by the Indemnified Party as a result of such loss,

 

21

 

claim, damage or liability.  In addition, Counterparty will reimburse any Indemnified Party for all expenses (including reasonable counsel fees and expenses) as they are incurred (after notice to Counterparty) in connection with the investigation of, preparation for or defense or settlement of any pending or threatened claim or any action, suit or proceeding arising therefrom, whether or not such Indemnified Party is a party thereto and whether or not such claim, action, suit or proceeding is initiated or brought by or on behalf of Counterparty.  This indemnity shall survive the completion of the Transaction contemplated by this Confirmation and any assignment and delegation of the Transaction made pursuant to this Confirmation or the Agreement and shall inure to the benefit of any permitted assignee of Dealer.

 

(f)                                   Transfer and Assignment.  Either party may transfer or assign any of its rights or obligations under the Transaction with the prior written consent of the non-transferring party, such consent not to be unreasonably withheld or delayed; provided that Dealer may transfer or assign without any consent of Counterparty its rights and obligations hereunder, in whole or in part, to any affiliate of Dealer (1) that has a long-term issuer rating that is equal to or better than Dealer’s credit rating at the time of such transfer or assignment, or (2) whose obligations hereunder will be guaranteed, pursuant to the terms of a customary guarantee in a form used by Dealer generally for similar transactions, by Dealer or Dealer’s ultimate parent, in each case, so long as (x) the Transfer Conditions are met and (y) Counterparty shall not, as a result of such transfer or assignment, (A) be required to pay the transferee or assignee on any payment date an amount under Section 2(d)(i)(4) of the Agreement greater than the amount that Counterparty would have been required to pay to Dealer in the absence of such transfer or assignment, or (B) receive from the transferee or assignee on any payment date an amount under Section 2(d)(i)(4) of the Agreement that is less than the amount that Counterparty would have received from Dealer in the absence of such transfer or assignment.  If at any time at which (1) the Equity Percentage exceeds 8.0% or (2) Dealer, Dealer Group (as defined below) or any person whose ownership position would be aggregated with that of Dealer or Dealer Group (Dealer, Dealer Group or any such person, a “Dealer Person”) under Section 203 of the Delaware General Corporation Law or other federal, state or local law, rule, regulation or regulatory order or organizational documents or contracts of Counterparty applicable to ownership of Shares (“Applicable Restrictions”), owns, beneficially owns, constructively owns, controls, holds the power to vote or otherwise meets a relevant definition of ownership in excess of a number of Shares equal to (x) the number of Shares that would give rise to reporting, registration, filing or notification obligations or other requirements (including obtaining prior approval by a state or federal regulator, but excluding reporting obligations arising under Section 13 of the Exchange Act) of a Dealer Person under Applicable Restrictions and with respect to which such requirements have not been met or the relevant approval has not been received or that would subject a Dealer Person to restrictions (including restrictions relating to business combinations or other designated transactions), or have any other adverse effect on a Dealer Person, under Applicable Restrictions minus (y) 1% of the number of Shares outstanding on the date of determination (either such condition described in clause (1) or (2), an “Excess Ownership Position”), Dealer, in its discretion, is unable to effect a transfer or assignment to an Eligible Counterparty in accordance with the Transfer Conditions after its commercially reasonable efforts on pricing and terms and within a time period reasonably acceptable to Dealer such that an Excess Ownership Position no longer exists, Dealer may designate any Scheduled Trading Day as an Early Termination Date with respect to a portion (the “Terminated Portion”) of the Transaction, such that an Excess Ownership Position would no longer exist following the resulting partial termination of the Transaction (after taking into account commercially reasonable adjustments to Dealer’s commercially reasonable Hedge Positions from such partial termination).  In the event that Dealer so designates an Early Termination Date with respect to a portion of the Transaction, a payment or delivery shall be made pursuant to Section 6 of the Agreement or Section 8(c) of this Confirmation as if (i) an Early Termination Date had been designated in respect of a Transaction having terms identical to the Terminated Portion of the Transaction, (ii) Counterparty were the sole Affected Party with respect to such partial termination, (iii) such portion of the Transaction were the only Terminated Transaction and (iv) Dealer were the party entitled to designate an Early Termination Date pursuant to Section 6(b) of the Agreement and to determine the amount payable pursuant to Section 6(e) of the Agreement. The “Equity Percentage” as of any day is the fraction, expressed as a percentage, (A) the numerator of which is the number of Shares that Dealer and any of its affiliates subject to aggregation with Dealer for purposes of the “beneficial ownership” test under Section 13 of the Exchange Act and all persons who may form a “group” (within the meaning of Rule 13d-5(b)(1) under the Exchange Act) with Dealer (collectively, “Dealer Group”) “beneficially own” (within the meaning of Section 13 of the

 

22

 

Exchange Act) without duplication on such day and (B) the denominator of which is the number of Shares outstanding on such day. An “Eligible Counterparty” is any nationally recognized dealer in equity derivatives with a rating (or having a guarantor with a rating) for its long term, unsecured and unsubordinated indebtedness equal to A- by Standard and Poor’s Rating Group, Inc. or its successor (“S&P”), or A3 by Moody’s Investor Service, Inc. (“Moody’s”) or, if either S&P or Moody’s ceases to rate such debt, at least an equivalent rating or better by a substitute rating agency mutually agreed by Counterparty and Dealer.  The “Transfer Conditions” mean that in connection with the transfer of the Transaction, (i) a Potential Event of Default, Event of Default or Additional Termination Event in respect of the Dealer shall not be in effect or result from such transfer or assignment and (ii) the transferee or assignee shall provide Counterparty with a complete and accurate U.S. Internal Revenue Service Form W-9 (or successor thereto) or W-8 (or successor thereto), as applicable, prior to becoming a party to the Transaction.  In the case of a transfer or assignment by Counterparty of its rights and obligations hereunder and under the Agreement, in whole or in part (any such Options so transferred or assigned, the “Transfer Options”), to any party, withholding of such consent by Dealer shall not be considered unreasonable if such transfer or assignment does not meet the reasonable conditions that Dealer may impose including, but not limited, to the following conditions:

 

(A)                          With respect to any Transfer Options, Counterparty shall not be released from its notice and indemnification obligations pursuant to Section 8(e) or any obligations under Section 2 (regarding Extraordinary Events) or 8(d) of this Confirmation;

 

(B)                          Any Transfer Options shall only be transferred or assigned to a third party that is a United States person (as defined in the Internal Revenue Code of 1986, as amended (the “Code”));

 

(C)                          Such transfer or assignment shall be effected on terms, including any reasonable undertakings by such third party (including, but not limited to, undertakings with respect to compliance with applicable securities laws in a manner that, in the reasonable judgment of Dealer, will not expose Dealer to material risks under applicable securities laws) and execution of any documentation and delivery of legal opinions with respect to securities laws and other matters by such third party and Counterparty as are requested by, and reasonably satisfactory to, Dealer;

 

(D)                          Dealer shall not, as a result of such transfer and assignment, be required to pay the transferee on any payment date an amount under Section 2(d)(i)(4) of the Agreement greater than an amount that Dealer would have been required to pay to Counterparty in the absence of such transfer and assignment;

 

(E)                           An Event of Default, Potential Event of Default or Termination Event shall not occur as a result of such transfer and assignment;

 

(F)                            Without limiting the generality of clause (B), Counterparty shall have caused the transferee to make such Payee Tax Representations and to provide such tax documentation as may be reasonably requested by Dealer to permit Dealer to determine that results described in clauses (D) and (E) will not occur upon or after such transfer and assignment; and

 

(G)                          Counterparty shall be responsible for all reasonable costs and expenses, including reasonable counsel fees, incurred by Dealer in connection with such transfer or assignment.

 

(g)                               Delivery of Shares.  Notwithstanding anything to the contrary herein, Dealer may, by prior notice to Counterparty, satisfy its obligation to deliver any Shares or other securities on any date due (an “Original Delivery Date”) by making separate deliveries of Shares or such securities, as the case may be, at more than one time on or prior to such Original Delivery Date, so long as the aggregate number of Shares and other securities so delivered on or prior to such Original Delivery Date is equal to the number required to be delivered on such Original Delivery Date.

 

23

 

(h)                                 Disclosure.  Effective from the date of commencement of discussions concerning the Transaction, Counterparty and each of its employees, representatives, or other agents may disclose to any and all persons, without limitation of any kind, the tax treatment and tax structure of the Transaction and all materials of any kind (including opinions or other tax analyses) that are provided to Counterparty relating to such tax treatment and tax structure.

 

(i)                                     No Netting and Set-off.  The provisions of Section 2(c) of the Agreement shall not apply to the Transaction.  Each party waives any and all rights it may have to set-off delivery or payment obligations it owes to the other party under the Transaction against any delivery or payment obligations owed to it by the other party, whether arising under the Agreement, under any other agreement between parties hereto, by operation of law or otherwise.

 

(j)                                    Equity Rights.  Dealer acknowledges and agrees that this Confirmation is not intended to convey to it rights with respect to the Transaction that are senior to the claims of common stockholders in the event of Counterparty’s bankruptcy.  For the avoidance of doubt, the parties agree that the preceding sentence shall not apply at any time other than during Counterparty’s bankruptcy to any claim arising as a result of a breach by Counterparty of any of its obligations under this Confirmation or the Agreement.  For the avoidance of doubt, the parties acknowledge that the obligations of Counterparty under this Confirmation are not secured by any collateral that would otherwise secure the obligations of Counterparty herein under or pursuant to any other agreement.

 

(k)                                 Early Unwind.  In the event the sale by Counterparty of the Option Securities is not consummated pursuant to the Purchase Agreement for any reason by the close of business in New York on June 10, 2016 (or such later date as agreed upon by the parties) (June 10, 2016 or such later date being the “Early Unwind Date”), the Transaction shall automatically terminate (the “Early Unwind”) on the Early Unwind Date and the Transaction and all of the respective rights and obligations of Dealer and Counterparty hereunder shall be cancelled and terminated.  Following such termination, cancellation and payment, each party shall be released and discharged by the other party from, and agrees not to make any claim against the other party with respect to, any obligations or liabilities of either party arising out of, and to be performed in connection with, the Transaction either prior to or after the Early Unwind Date; provided that Counterparty shall purchase from Dealer on the Early Unwind Date all Shares purchased by Dealer or one or more of its affiliates in connection with the Transaction at the then prevailing market price.  Dealer and Counterparty represent and acknowledge to the other that upon an Early Unwind and following the payment referred to above, all obligations with respect to the Transaction shall be deemed fully and finally discharged.

 

(l)                                     Agreements and Acknowledgements Regarding Hedging. Counterparty understands, acknowledges and agrees that: (A) at any time on and prior to the Expiration Date, Dealer and its affiliates may buy or sell Shares or other securities or buy or sell options or futures contracts or enter into swaps or other derivative securities in order to adjust its hedge position with respect to the Transaction; (B) Dealer and its affiliates also may be active in the market for Shares other than in connection with hedging activities in relation to the Transaction; (C) Dealer shall make its own determination as to whether, when or in what manner any hedging or market activities in securities of Issuer shall be conducted and shall do so in a manner that it deems appropriate to hedge its price and market risk with respect to the “Daily VWAP” (as defined in the Indenture); (D) any market activities of Dealer and its affiliates with respect to Shares may affect the market price and volatility of Shares, as well as the “Daily VWAP” (as defined in the Indenture), each in a manner that may be adverse to Counterparty; and (E) the Transaction is a derivatives transaction in which it has granted Dealer an option, and Dealer may purchase shares for its own account at an average price that may be greater than, or less than, the price paid by Counterparty under the terms of the Transaction.

 

(m)                             Wall Street Transparency and Accountability Act.  In connection with Section 739 of the Wall Street Transparency and Accountability Act of 2010 (the “WSTAA”), the parties hereby agree that neither the enactment of the WSTAA (or any statute containing any legal certainty provision similar to Section 739 of the WSTAA) or any regulation under the WSTAA (or any such statute), nor any requirement under the WSTAA (or any statute containing any legal certainty provision similar to Section

 

24

 

739 of the WSTAA) or an amendment made by the WSTAA (or any such statute), shall limit or otherwise impair either party’s otherwise applicable rights to terminate, renegotiate, modify, amend or supplement this Confirmation or the Agreement, as applicable, arising from a termination event, force majeure, illegality, increased costs, regulatory change or similar event under this Confirmation, the Equity Definitions incorporated herein, or the Agreement (including, but not limited to, rights arising from Change in Law, Hedging Disruption, Increased Cost of Hedging or Illegality).

 

(n)                                 Governing Law.  THE AGREEMENT, THIS CONFIRMATION AND ALL MATTERS ARISING IN CONNECTION WITH THE AGREEMENT AND THIS CONFIRMATION SHALL BE GOVERNED BY, AND CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (WITHOUT REFERENCE TO ITS CHOICE OF LAW DOCTRINE, OTHER THAN TITLE 14 OF ARTICLE 5 OF THE NEW YORK GENERAL OBLIGATIONS LAW).

 

(o)                                 Amendment.  This Confirmation and the Agreement may not be modified, amended or supplemented, except in a written instrument signed by Counterparty and Dealer.

 

(p)                                 Counterparts.  This Confirmation may be executed in several counterparts, each of which shall be deemed an original but all of which together shall constitute one and the same instrument.

 

(q)                                 Tax Matters.  For purposes of Sections 4(a)(i) and (ii) of the Agreement, each party agrees to deliver to the other one duly executed and completed United States Internal Revenue Service Form W-9 (or successor thereto) or appropriate Form W-8 (or successor thereto) (together with any appropriate attachments).

 

(r)                                    Withholding Tax with Respect to Non-US Counterparties. “Indemnifiable Tax” as defined in Section 14 of the Agreement shall not include (i) any U.S. federal withholding tax imposed or collected pursuant to Sections 1471 through 1474 of the Code, any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code (a “FATCA Withholding Tax”) or (ii) any U.S. federal withholding tax imposed on amounts treated as dividends from sources within the United States under Section 871(m) of the Code (or any Treasury regulations or other guidance issued thereunder). For the avoidance of doubt, a FATCA Withholding Tax is a Tax the deduction or withholding of which is required by applicable law for the purposes of Section 2(d) of the Agreement.

 

(s)                                   Amendment to Equity Definitions.

 

(i)                                     Section 11.2(e)(vii) of the Equity Definitions is hereby amended by deleting the words “a diluting or concentrative” and replacing them with the words “a material” and adding the phrase “or the Options” at the end of the sentence.

 

(ii)                                  Section 12.9(b)(vi) of the Equity Definitions is hereby amended by (1) replacing the comma immediately following clause (A) thereof with the word “or”, (2) deleting clause (C) thereof in its entirety and (3) replacing the words “either party” in the last sentence thereof with the words “the Hedging Party”.

 

(t)                                    Other Adjustments Pursuant to the Equity Definitions.  Notwithstanding anything to the contrary in the Agreement, the Equity Definitions or this Confirmation, upon the occurrence of a Merger Date, the occurrence of a Tender Offer Date, or declaration by Counterparty of the terms of any Potential Adjustment Event, the Calculation Agent may adjust the Cap Price to preserve the fair value of the Options to Dealer (provided that in no event shall the Cap Price be less than the Strike Price, and, for the avoidance of doubt, the Delivery Obligation shall be calculated on the basis of such adjustments by the Calculation Agent).  Solely for purposes of this Section 8(t), the terms “Potential Adjustment Event,” “Merger Event,” and “Tender Offer” shall each have the meanings assigned to each such term in the Equity Definitions (as amended by Section 8(s)(i)).

 

25

 

(u)                                 Waiver of Jury Trial.  Each party 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 proceeding relating to the Transaction.  Each party (i) certifies that no representative, agent or attorney of either party has represented, expressly or otherwise, that such other party would not, in the event of such a suit, action or proceeding, seek to enforce the foregoing waiver and (ii) acknowledges that it and the other party have been induced to enter into the Transaction, as applicable, by, among other things, the mutual waivers and certifications provided herein.

 

26

 

Counterparty hereby agrees (a) to check this Confirmation carefully and immediately upon receipt so that errors or discrepancies can be promptly identified and rectified and (b) to confirm that the foregoing (in the exact form provided by Dealer) correctly sets forth the terms of the agreement between Dealer and Counterparty with respect to the Transaction, by manually signing this Confirmation or this page hereof as evidence of agreement to such terms and providing the other information requested herein and immediately returning an executed copy to Dealer.

 

 

	
 
    	
 
    	
Yours faithfully,
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
BANK OF AMERICA, N.A.
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By:
    	
/s/ Christopher A.   Hutmaker
    
	
 
    	
 
    	
 
    	
Name: Christopher A.   Hutmaker
    
	
 
    	
 
    	
 
    	
Title: Managing   Director
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Agreed and Accepted By:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
THE   MEDICINES COMPANY
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/ William O’Connor
    	
 
    	
 
    
	
 
    	
Name: William O’Connor
    	
 
    	
 
    
	
 
    	
Title: Chief Financial   Officer
    	
 
    	
 
    

 

 

EXHIBIT A

 

[FORM OF CAPPED CALL OPINION]

 

1.              The execution, delivery and performance by the Company of the Confirmations do not result in any violation of (i) Applicable Laws (as defined below) applicable to the Company or (ii) any of the terms and provisions of, under the Certificate of Incorporation or Bylaws or any of the agreements of, or other instruments binding upon, the Company filed as exhibits to the Company’s Annual Report on Form 10-K for the year ended December 31, 2015 or the Company’s Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2016, in each case except for such violations as would not, individually or in the aggregate, reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.

 

“Applicable Laws” means the federal laws of the United States of America and the laws of the State of New York and the rules and regulations adopted thereunder that in our experience are normally applicable to transactions of the type contemplated by the Confirmations.  However, the term “Applicable Laws” does not include, and we express no opinion with regard to (A) any state laws, rules or regulations relating to state securities or Blue Sky laws, federal or state antifraud laws or federal securities laws, (B) any laws, rules or regulations of any county, municipality or similar political subdivision or any agency or instrumentality thereof and (C) any laws, rules or regulations that are applicable to the Company, the Confirmations or the transactions contemplated thereby solely because such laws, rules or regulations are part of a regulatory regime applicable to any party to any of the Confirmations or the Company or any of its affiliates because of the specific assets or business of the Company or such affiliate.

 

2.              The Confirmations have been duly authorized, executed and delivered by the Company.

 

3.              No consent, approval, authorization or order of, or qualification with, any court or governmental agency or body having jurisdiction over the Company is required to be obtained or made by the Company under Applicable Laws in connection with the execution of the Confirmations to which it is a party and the consummation of the transactions contemplated by the Confirmations, other than those consents, approvals, authorizations, orders or qualifications that have been obtained and are in effect, and except where the failure to obtain or make such consent, approval, authorization, order or qualification would not reasonably be expected to have a material adverse effect on the Company and its subsidiaries, taken as a whole.  For the avoidance of doubt, we express no opinion in this paragraph as to compliance with the registration provisions of the Securities Act of 1933, as amended in relation to the Notes, or the Trust Indenture Act of 1939, as amended with respect to the Indenture.

 

4.              The statements in the Offering Memorandum under the heading “Description of Capped Call Transactions,” insofar as it purports to summarize certain provisions of the Confirmations described therein, are accurate in all material respects.

 

5.              The Company is not, and, after giving effect to the consummation of the issuance and sale of the Notes and any other transactions contemplated in the Offering Memorandum, will not be required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.Exhibit 4.2

 

EXECUTION VERSION

 

 

 

 

 

 

 

DATED AS OF JUNE 10, 2016

 

 

ALEXANDRIA REAL ESTATE EQUITIES, INC., 
 as Issuer,

 

ALEXANDRIA REAL ESTATE EQUITIES, L.P.
  as Guarantor,

 

and

 

WILMINGTON TRUST, NATIONAL ASSOCIATION,
  as Trustee

 

 

 

 

SUPPLEMENTAL INDENTURE NO. 2
 $350,000,000
 3.95% SENIOR NOTES DUE 2027

 

 

CONTENTS

 

	
Clause
    	
 
    	
 
    	
Page
    
	
ARTICLE I
    	
RELATION TO BASE INDENTURE
    	
 
    	
2
    
	
Section 1.1.
    	
Relation   to Base Indenture
    	
 
    	
2
    
	
ARTICLE II
    	
DEFINITIONS
    	
 
    	
2
    
	
Section 2.1.
    	
Definitions
    	
 
    	
2
    
	
ARTICLE III
    	
THE   SERIES OF NOTES
    	
 
    	
7
    
	
Section 3.1.
    	
Title   of the Securities
    	
 
    	
7
    
	
Section 3.2.
    	
Price
    	
 
    	
7
    
	
Section 3.3.
    	
Issuance
    	
 
    	
8
    
	
Section 3.4.
    	
Limitation   on Aggregate Principal Amount
    	
 
    	
8
    
	
Section 3.5.
    	
Interest   and Interest Rates; Maturity Date of Notes
    	
 
    	
8
    
	
Section 3.6.
    	
Method   of Payment
    	
 
    	
8
    
	
Section 3.7.
    	
Currency
    	
 
    	
9
    
	
Section 3.8.
    	
No   Sinking Fund
    	
 
    	
9
    
	
Section 3.9.
    	
No   Conversion or Exchange Rights
    	
 
    	
10
    
	
Section 3.10.
    	
No   Personal Liability of Directors, Officers, Employees and Stockholders
    	
 
    	
10
    
	
Section 3.11.
    	
Registered   Securities; Global Form
    	
 
    	
10
    
	
Section 3.12.
    	
Transfer   and Exchange
    	
 
    	
10
    
	
Section 3.13.
    	
General   Provisions Relating to Transfers and Exchanges
    	
 
    	
14
    
	
ARTICLE IV
    	
REDEMPTION
    	
 
    	
15
    
	
Section 4.1.
    	
Optional   Redemption
    	
 
    	
15
    
	
Section 4.2.
    	
Notice   of Optional Redemption; Selection of Notes
    	
 
    	
15
    
	
Section 4.3.
    	
Payment   of Notes Called for Redemption by the Company
    	
 
    	
16
    
	
ARTICLE V
    	
GUARANTEE
    	
 
    	
17
    
	
Section 5.1.
    	
Guarantee
    	
 
    	
17
    
	
Section 5.2.
    	
Execution   and Delivery of Guarantee
    	
 
    	
18
    
	
Section 5.3.
    	
Limitation   of Guarantor’s Liability; Certain Bankruptcy Events
    	
 
    	
19
    
	
Section 5.4.
    	
Application   of Certain Terms and Provisions to the Guarantor
    	
 
    	
19
    
	
ARTICLE VI
    	
ADDITIONAL   COVENANTS
    	
 
    	
19
    
	
Section 6.1.
    	
Maintenance   of Office or Agency
    	
 
    	
19
    
	
Section 6.2.
    	
Appointments   to Fill Vacancies in Trustee’s Office
    	
 
    	
20
    

 

 

	
Section 6.3.
    	
Limitations on Incurrence   of Debt
    	
 
    	
20
    
	
ARTICLE VII
    	
DEFAULTS   AND REMEDIES
    	
 
    	
22
    
	
Section 7.1.
    	
Events   of Default
    	
 
    	
22
    
	
Section 7.2.
    	
Acceleration   of Maturity; Rescission and Annulment
    	
 
    	
23
    
	
Section 7.3.
    	
Limitation   on Suits
    	
 
    	
24
    
	
Section 7.4.
    	
Notice   of Defaults
    	
 
    	
24
    
	
ARTICLE VIII
    	
AMENDMENTS   AND WAIVERS
    	
 
    	
25
    
	
Section 8.1.
    	
Without   Consent of Holders
    	
 
    	
25
    
	
ARTICLE IX
    	
MEETINGS   OF HOLDERS OF NOTES
    	
 
    	
26
    
	
Section 9.1.
    	
Purposes   for Which Meetings May Be Called
    	
 
    	
26
    
	
Section 9.2.
    	
Call,   Notice and Place of Meetings
    	
 
    	
26
    
	
Section 9.3.
    	
Persons   Entitled to Vote at Meetings
    	
 
    	
26
    
	
Section 9.4.
    	
Quorum;   Action
    	
 
    	
27
    
	
Section 9.5.
    	
Determination   of Voting Rights; Conduct and Adjournment of Meetings
    	
 
    	
27
    
	
Section 9.6.
    	
Counting   Votes and Recording Action of Meetings
    	
 
    	
28
    
	
ARTICLE X
    	
MISCELLANEOUS   PROVISIONS
    	
 
    	
28
    
	
Section 10.1.
    	
Ratification   of Indenture
    	
 
    	
28
    
	
Section 10.2.
    	
Governing   Law
    	
 
    	
29
    
	
Section 10.3.
    	
Counterparts
    	
 
    	
29
    
	
Section 10.4.
    	
Notices
    	
 
    	
29
    
	
Section 10.5.
    	
Successors   and Assigns
    	
 
    	
29
    
	
Section 10.6.
    	
Time   of the Essence
    	
 
    	
29
    
	
Section 10.7.
    	
Rights   of Holders Limited
    	
 
    	
29
    
	
Section 10.8.
    	
Rights   and Duties of Trustee
    	
 
    	
29
    
	
Section 10.9.
    	
Notices
    	
 
    	
30
    
	
Section 10.10.
    	
Headings,   etc.
    	
 
    	
30
    
	
Section 10.11.
    	
Conflicts
    	
 
    	
31
    
	
Section 10.12.
    	
Trust   Indenture Act Controls
    	
 
    	
31
    

 

 

SUPPLEMENTAL INDENTURE NO. 2, dated as of June 10, 2016 (this “Second Supplemental Indenture”), among ALEXANDRIA REAL ESTATE EQUITIES, INC., a Maryland corporation (the “Company”), ALEXANDRIA REAL ESTATE EQUITIES, L.P., a Delaware limited partnership (the “Guarantor”) and WILMINGTON TRUST, NATIONAL ASSOCIATION, as trustee (the “Trustee”).

 

R E C I T A L S

 

WHEREAS, the Company, the Guarantor and the Trustee have heretofore entered into an Indenture dated as of November 17, 2015 (the “Base Indenture”), providing for the issuance from time to time of unsecured debentures, notes or other evidences of indebtedness (the “Securities”) of the Company in one or more series;

 

WHEREAS, the Company, the Guarantor and the Trustee executed the first supplemental indenture dated as of November 17, 2015, pursuant to which the Issuer issued $300,000,000 in aggregate principal amount of its 4.30% Senior Notes due 2026 on November 17, 2015 (the “2026 Notes”);

 

WHEREAS, Section 9.1(6) and (7) of the Base Indenture provides, among other things, that, without the consent of the Holders of the Securities, one or more indentures supplemental to the Base Indenture may be entered into (i) to establish the form or terms of Securities of any series or (ii) to add to, change or eliminate any of the provisions of the Base Indenture in respect of one or more series of Securities; provided that any such addition, change or elimination shall become effective only when there is no such Security Outstanding;

 

WHEREAS, each of the Company and the Guarantor desires to execute this Second Supplemental Indenture to establish the form and to provide for the issuance of a series of the Company’s senior notes designated as its 3.95% Senior Notes due 2027 (the “Notes”) in an initial aggregate principal amount of $350,000,000;

 

WHEREAS, the Guarantor will guarantee the due and punctual payment of the principal, premium, if any, and interest on the Notes pursuant to Article V of this Second Supplemental Indenture;

 

WHEREAS, the Board of Directors of the Company (the “Board of Directors”) has duly adopted resolutions authorizing the Company to create and issue the Notes and to execute and deliver this Second Supplemental Indenture;

 

WHEREAS, the Board of Directors of ARE-QRS Corp., as sole general partner of the Guarantor, has duly adopted resolutions authorizing the Guarantor to execute and deliver this Second Supplemental Indenture;

 

WHEREAS, concurrently with the execution hereof, the Company has delivered to the Trustee an Officers’ Certificate and has caused its counsel to deliver to the Trustee an Opinion of Counsel or a reliance letter upon an Opinion of Counsel satisfying the requirements of Sections 1.2,  3.3 and 9.3 of the Base Indenture; and

 

- 1 -

 

WHEREAS, all other conditions and requirements necessary to make this Second Supplemental Indenture, when duly executed and delivered, a valid and binding agreement in accordance with its terms and for the purposes herein expressed, have been performed and fulfilled.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

For and in consideration of the premises and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, each of the Company, the Guarantor and the Trustee agrees as follows:

 

ARTICLE I

 

RELATION TO BASE INDENTURE

 

Section 1.1.     Relation to Base Indenture.  This Second Supplemental Indenture constitutes an integral part of the Base Indenture.  Notwithstanding any other provision of this Second Supplemental Indenture, all provisions of this Second Supplemental Indenture are expressly and solely for the benefit of the Holders of the Notes and any such provisions shall not be deemed to apply to any other Securities issued under the Base Indenture and shall not be deemed to amend, modify or supplement the Base Indenture for any purpose other than with respect to the Notes.

 

ARTICLE II

 

DEFINITIONS

 

Section 2.1.     Definitions.  For all purposes of this Second Supplemental Indenture, except as otherwise expressly provided for or unless the context otherwise requires:

 

(a)        capitalized terms used but not defined herein shall have the respective meanings assigned to them in the Base Indenture;

 

(b)        all references herein to Articles and Sections, unless otherwise specified, refer to the corresponding Articles and Sections of this Second Supplemental Indenture; and

 

(c)        as used herein the following terms have the following meanings:

 

“Acquired Debt” means Debt of a person (1) existing at the time such person becomes a Subsidiary or (2) assumed in connection with the acquisition of assets from such person, in each case, other than Debt incurred in connection with, or in contemplation of, such person becoming a Subsidiary or such acquisition.  Acquired Debt shall be deemed to be incurred on the date of the related acquisition of assets from any person or the date the acquired person becomes a Subsidiary.

 

“Additional Notes” means additional Notes (other than the Initial Notes) issued under the Indenture in accordance with Section 3.4 hereof, as part of the same series as the Initial Notes.

 

- 2 -

 

“Applicable Procedures” means, with respect to any transfer or exchange of or for beneficial interests in any Global Note, the rules and procedures of the Depository, Euroclear and Clearstream that apply to such transfer or exchange.

 

“Bankruptcy Law” means title 11, U.S. Code or any similar Federal or State law for the relief of debtors.

 

“Benefited Party” has the meaning set forth in Section 5.1 hereof.

 

“Clearstream” means Clearstream Banking, S.A.

 

“Consolidated EBITDA” means, for any period of time, the net income (loss) of the Company and its Subsidiaries, determined on a consolidated basis in accordance with GAAP for such period, before deductions for (without duplication):

 

(1)                              Interest Expense;

 

(2)                              taxes;

 

(3)                              depreciation and amortization (including depreciation and amortization with respect to interests in joint ventures and partially owned entity investments), amortization of deferred charges, and all other non-cash items, as determined reasonably and in good faith by the Company;

 

(4)                              impairments, prepayment penalties and all costs or fees incurred in connection with any debt financing or amendment thereto, acquisition, disposition, recapitalization or similar transaction (regardless of whether such transaction is completed);

 

(5)                              extraordinary items, the effect of any charge resulting from a change in accounting principles in determining net income (loss), non-recurring items or other unusual items, as determined reasonably and in good faith by the Company;

 

(6)                              noncontrolling interests;

 

(7)                              amounts related to swap ineffectiveness or attributable to transactions involving derivative instruments that do not qualify for hedge accounting in accordance with GAAP; and

 

(8)                              gains or losses on dispositions of real estate investments or property valuation losses.

 

For purposes of calculating Consolidated EBITDA, GAAP is not applicable with respect to the determination of all non-cash and non-recurring items which shall be determined reasonably and in good faith by the Company.

 

“Debt” means any of the Company’s or any of its Subsidiaries’ indebtedness, whether or not contingent, in respect of (without duplication) (1) borrowed money evidenced by bonds,

 

- 3 -

 

notes (including the Notes and the 2026 Notes), debentures or similar instruments, (2) obligations secured by any mortgage, pledge, lien, charge, encumbrance or any security interest existing on property owned by the Company or any of its Subsidiaries, but only to the extent of the lesser of (a) the amount of obligations so secured and (b) the fair market value (determined in good faith by the board of directors of such person (as evidenced by an Officers’ Certificate to the Trustee) or, in the case of the Company or a Subsidiary of the Company, by the Board of Directors (as evidenced by an Officers’ Certificate delivered to the Trustee) of the property subject to such mortgage, pledge, lien, charge, encumbrance or security interest, (3) the reimbursement obligations, contingent or otherwise, in connection with any letters of credit actually issued or amounts representing the balance deferred and unpaid of the purchase price of any property or services, except any such balance that constitutes an accrued expense or trade payable, or all conditional sale obligations or obligations under any title retention agreement, or (4) any lease of property by the Company or any of its Subsidiaries as lessee which is reflected on the Company’s consolidated balance sheet as a capitalized lease in accordance with GAAP; but only to the extent, in the case of items of indebtedness under (1) through (3) above, that any such items (other than letters of credit) would appear as a liability on the Company’s consolidated balance sheet in accordance with GAAP.  The term “Debt” also includes, to the extent not otherwise included, any obligation of the Company or any of its Subsidiaries to be liable for, or to pay, as obligor, guarantor or otherwise (other than for purposes of collection in the ordinary course of business or for the purposes of guaranteeing the payment of all amounts due and owing pursuant to leases to which the Company or any of its Subsidiaries are a party and have assigned its or their interest, provided that such assignee of the Company or its Subsidiary is not in default of any amounts due and owing under such leases), Debt of another person (other than the Company or any of its Subsidiaries) (it being understood that Debt shall be deemed to be incurred by the Company or any of its Subsidiaries whenever the Company or such Subsidiary shall create, assume, guarantee or otherwise become liable in respect thereof).

 

“Default” means any event that is, or with the passage of time or the giving of notice or both would be, an Event of Default.

 

“Defaulted Interest” has the meaning set forth in Section 3.6 hereof.

 

“Definitive Note” means a certificated Note registered in the name of the Holder thereof and issued in accordance with Section 3.13 hereof, substantially in the form of Exhibit A hereof except that such Note shall not bear the Global Note legend and shall not have the “Schedule of Exchanges of Interests in the Global Note” attached thereto.

 

“Depository” means, with respect to the Notes, the Depository Trust Company and any successor thereto.

 

“Dollars” and “$” means the currency of the United States of America.

 

“Euroclear” means Euroclear Bank, S.A./N.V., as operator of the Euroclear system.

 

“Event of Default” has the meaning set forth in Section 7.1 hereof.

 

“GAAP” means generally accepted accounting principles in the United States of America, consistently applied, as in effect as of the date hereof, including those set forth in the

 

- 4 -

 

opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board.

 

“Global Note” means, individually and collectively, each of the Notes in the form established pursuant to Section 3.11 issued to the Depository or its nominee, substantially in the form of Exhibit A.

 

“Guarantee Obligations” has the meaning set forth in Section 5.1 hereof.

 

“Indenture” means the Base Indenture, as supplemented, amended or restated, from time to time.

 

“Indirect Participant” means a person who holds a beneficial interest in a Global Note through a Participant.

 

“Initial Notes” means the first $350,000,000 aggregate principal amount of Notes issued under this Second Supplemental Indenture on the date hereof.

 

“Initial Original Principal Amount” has the meaning set forth in Section 3.4 hereof.

 

“Intercompany Debt” means Debt to which the only parties are any of the Company, the Guarantor and any Subsidiary of the Company or the Guarantor; provided, however, that with respect to any such Debt of which the Company or the Guarantor is the borrower, such Debt is subordinate in right of payment to the Notes.

 

“Interest Expense” means, for any period of time, the aggregate amount of interest expense determined on a consolidated basis in accordance with GAAP for such period by the Company and its Subsidiaries, but excluding (i) interest reserves funded from the proceeds of any loan, (ii) prepayment penalties, (iii) amortization of deferred financing costs, and (iv) swap ineffectiveness charges or charges attributable to transactions involving derivative instruments that do not qualify for hedge accounting in accordance with GAAP.

 

“Interest Payment Date” has the meaning set forth in Section 3.5 hereof.

 

“Make-Whole Amount” means, in connection with any optional redemption of the Notes, the excess, if any, as determined by the Company, of:

 

(1)                              the aggregate present value as of the date of such redemption of each dollar of principal being redeemed or paid and the amount of interest (exclusive of interest accrued to the date of redemption) that would have been payable in respect of such principal amount through October 15, 2026 as if such redemption or accelerated payment had not been made, determined by discounting, on a semi-annual basis, such principal and interest at the Reinvestment Rate (determined by the Company on the third Business Day preceding the date a notice of redemption is given) from the respective dates on which such principal and interest would have been payable (or, in the case of accrued interest as of October 15, 2026, from such date) as if such redemption or payment had not been made, over

 

- 5 -

 

(2)                              the aggregate principal amount of the Notes being redeemed or paid.

 

The Trustee shall have no duty to calculate or verify the Company’s calculations of the Make-Whole Amount.

 

“Maturity Date” has the meaning set forth in Section 3.5 hereof.

 

“Notes” has the meaning specified in the sixth whereas clause hereof.  The Initial Notes and the Additional Notes shall be treated as a single class for all purposes under the Indenture, and unless the context otherwise requires, all references to the Notes shall include the Initial Notes and any Additional Notes.

 

“Officer” means the Chief Executive Officer, the Chief Financial Officer, the President, any Vice-President, the Treasurer, the Secretary, any Assistant Treasurer or any Assistant Secretary of the Company.

 

“Participant” means, with respect to the Depository, Euroclear or Clearstream, a person who has an account with the Depository, Euroclear or Clearstream, respectively.

 

“Prospectus” means the base prospectus, dated November 3, 2015, included as part of a registration statement on Form S-3 under Securities Act, filed by the Company with the Commission on November 3, 2015 (File No. 333-207762), as supplemented by a prospectus supplement, dated June 1, 2016 filed by the Company with the Commission pursuant to Rule 424(b) under the Securities Act.

 

“Record Date” has the meaning set forth in Section 3.5 hereof.

 

“Redemption Date” means, with respect to any Note or portion thereof to be redeemed in accordance with the provisions of Section 4.1 hereof, the date fixed for such redemption in accordance with the provisions of Section 4.1 hereof.

 

“Redemption Price” has the meaning specified in Section 4.1 hereof.

 

“Reinvestment Rate” means 0.35% plus the arithmetic mean of the yields under the respective heading “Week Ending” published in the most recent Statistical Release under “Treasury Constant Maturities” for the maturity (rounded to the nearest month) corresponding to October 15, 2026, as of the date of the principal being redeemed or paid.  If no maturity exactly corresponds to such maturity, yields for the two published maturities most closely corresponding to such maturity shall be calculated pursuant to the immediately preceding sentence and the Reinvestment Rate shall be interpolated or extrapolated from such yields on a straight-line basis, rounding in each of such relevant periods to the nearest month.  For the purpose of calculating the Reinvestment Rate, the most recent Statistical Release published prior to the date of determination of the Make-Whole Amount shall be used.

 

“Securities Act” means the Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder, as in effect from time to time.

 

- 6 -

 

“Significant Subsidiary” means each Subsidiary that is a “significant subsidiary,” if any, of the Company, as such term is defined in Regulation S-X under the Securities Act.

 

“Statistical Release” means that statistical release designated “H.15(519)” or any successor publication that is published weekly by the Federal Reserve System and that establishes annual yields on actively traded United States government securities adjusted to constant maturities, or, if such statistical release is not published at the time of any determination under the Indenture, then such other reasonably comparable index the Company designates.  If the format or content of the Statistical Release changes in a manner that precludes determination of the Treasury yield in the manner above, then the Treasury yield shall be determined in the manner that most closely approximates the above manner, as reasonably determined by the Company.

 

“Total Assets” as of any date means the sum of (1) the Company’s and all of its Subsidiaries’ Undepreciated Real Estate Assets and (2) all of the Company’s and all of its Subsidiaries’ other assets determined in accordance with GAAP (but excluding accounts receivable and acquisition intangibles, including goodwill).

 

“Undepreciated Real Estate Assets” as of any date means the cost (original cost plus capital improvements) of the Company’s and its Subsidiaries’ real estate assets on such date, before depreciation and amortization determined on a consolidated basis in accordance with GAAP.

 

“Unencumbered Total Asset Value” as of any date means the sum of (1) those Undepreciated Real Estate Assets not encumbered by any mortgage, lien, charge, pledge or security interest and (2) all of the Company’s and its Subsidiaries’ other assets on a consolidated basis determined in accordance with GAAP (but excluding accounts receivable and acquisition intangibles, including goodwill), in each case which are unencumbered by any mortgage, lien, charge, pledge or security interest; provided, however, that in determining Unencumbered Total Asset Value for purposes of this Second Supplemental Indenture, all investments by the Company and any of its Subsidiaries in unconsolidated joint ventures, unconsolidated limited partnerships, unconsolidated limited liability companies and other unconsolidated entities accounted for financial reporting purposes using the equity method of accounting in accordance with GAAP shall be excluded from Unencumbered Total Asset Value.

 

ARTICLE III

 

THE SERIES OF NOTES

 

Section 3.1.     Title of the Securities.  There shall be a series of Securities designated the 3.95% Senior Notes due 2027.

 

Section 3.2.     Price.  The Initial Notes shall be issued at a public offering price of 99.601% of the principal amount thereof, other than any offering discounts pursuant to the initial offering and resale of the Notes.

 

- 7 -

 

Section 3.3.     Issuance.  The Notes will be issued only in fully registered, book-entry form, in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.  The registered Holder of a Note will be treated as its owner for all purposes.

 

Section 3.4.     Limitation on Aggregate Principal Amount.  The aggregate principal amount of the Notes shall initially be limited to $350,000,000 (the “Initial Original Principal Amount”).  Notwithstanding the foregoing, the Company, without notice to or the consent of the Holders of the Notes, by Board Resolutions or indentures supplemental to the Base Indenture from time to time may increase the principal amount of the Notes by issuing Additional Notes in the future on the same terms and conditions as the Initial Notes except for any difference in the issue price and interest accrued prior to the issue date of the Additional Notes, and with the same CUSIP number as the Initial Notes so long as such Additional Notes are fungible for U.S. income tax purposes with the Initial Notes (as determined by the Company).  Except as provided in this Section 3.4, any such Board Resolutions or indentures supplemental to the Base Indenture and Sections 2.1 and 3.1 of the Base Indenture, the Company shall not execute and the Trustee shall not authenticate or deliver Notes in excess of the Initial Original Principal Amount.

 

Nothing contained in this Section 3.4 or elsewhere in this Second Supplemental Indenture, or in the Notes, is intended to or shall limit execution by the Company or authentication or delivery by the Trustee of the Notes under the circumstances contemplated in Sections 3.3, 3.4, 3.6 and 11.7 of the Base Indenture.

 

Section 3.5.     Interest and Interest Rates; Maturity Date of Notes.  The Notes will bear interest at a rate of 3.95% per annum from June 10, 2016 or from the immediately preceding Interest Payment Date to which interest has been paid or duly provided for, payable semi-annually in arrears on January 15 and July 15 of each year, commencing January 15, 2017 (each, an “Interest Payment Date”), to the person in whose name such Note is registered at the close of business on the January 1 or July 1 (whether or not a Business Day), as the case may be, immediately preceding such Interest Payment Date (each, a “Record Date”).  Interest will be computed on the basis of a 360-day year composed of twelve 30-day months.

 

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

 

The Notes will mature on January 15, 2027 (the “Maturity Date”).

 

Section 3.6.     Method of Payment.  The Company covenants and agrees that it will duly and punctually pay or cause to be paid when due the principal of (including the Redemption Price upon redemption pursuant to Article IV, if applicable), and interest on each of the Securities at the places, at the respective times and in the manner provided herein and in the Securities; provided that the Company may withhold from payments of interest and upon redemption pursuant to Article IV hereof, if applicable, maturity or otherwise, any amounts the Company is required to withhold by law.  Interest shall be payable at the office of the Company maintained by the Company for such purposes, which shall initially be an office or agency of the 

 

- 8 -

 

Trustee.  The Company shall pay interest (i) on any Notes in certificated form by check mailed to the address of the person entitled thereto as it appears in the register; provided, however, that a Holder of any Notes in certificated form in the aggregate principal amount of more than $2.0 million may specify by written notice to the Company that it pay interest by wire transfer of immediately available funds to the account specified by the Holder in such notice, or (ii) on any Global Note by wire transfer of immediately available funds to the account of the Depository or its nominee.  Any interest on any Note which is payable, but is not punctually paid or duly provided for, on any January 15 or July 15 (herein called “Defaulted Interest”) shall forthwith cease to be payable to the Holder registered as such on the relevant Record Date, and such Defaulted Interest shall be paid by the Company, at its election in each case, as provided in clause (a) or (b) below:

 

(a)        The Company may elect to make payment of any Defaulted Interest to the persons in whose names the Notes are registered at 5:00 p.m., New York City time, on a special record date for the payment of such Defaulted Interest, which shall be fixed in the following manner.  The Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date of the proposed payment (which shall be not less than twenty-five (25) calendar days after the receipt by the Trustee of such notice), and at the same time the Company shall deposit with the Trustee an amount of monies equal to the aggregate amount to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit on or prior to the date of the proposed payment, such monies when deposited to be held in trust for the benefit of the persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Company shall fix a special record date for the payment of such Defaulted Interest which shall be not more than fifteen (15) calendar days and not less than ten (10) calendar days prior to the date of the proposed payment, and not less than ten (10) calendar days after the receipt by the Trustee of the notice of the proposed payment.  The Company shall promptly notify the Trustee of such special record date and, in the name and at the expense of the Company, shall cause notice of the proposed payment of such Defaulted Interest and the special record date therefor to be delivered to each Holder at its address as it appears in the register, not less than ten (10) calendar days prior to such special record date.  Notice of the proposed payment of such Defaulted Interest and the special record date therefor having been so mailed, such Defaulted Interest shall be paid to the persons in whose names the Notes are registered at 5:00 p.m., New York City time, on such special record date and shall no longer be payable pursuant to the following clause (b) of this Section 3.6.

 

(b)        The Company may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange or automated quotation system on which the Notes may be listed or designated for issuance, and upon such notice as may be required by such exchange or automated quotation system, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause, such manner of payment shall be deemed practicable by the Trustee.

 

Section 3.7.     Currency.  Principal and interest on the Notes shall be payable in Dollars.

 

Section 3.8.     No Sinking Fund.  The provisions of Article XII of the Base Indenture shall not be applicable to the Notes.

 

- 9 -

 

Section 3.9.     No Conversion or Exchange Rights.  The Notes will not be convertible into or exchangeable for any capital stock of the Company.

 

Section 3.10.   No Personal Liability of Directors, Officers, Employees and Stockholders.  No director, officer, employee or stockholder (past or present) of the Company or the Guarantor, as such, will have any liability for any of the Company’s or the Guarantor’s obligations under the Notes, the Guarantee or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.  Each Holder of Notes by accepting a Note waives and releases all such liability.  The waiver and release are part of the consideration for issuance of the Notes.

 

Section 3.11.   Registered Securities; Global Form.  The Notes will be issued in the form of one or more fully-registered Global Notes in book-entry form, which will be deposited with, or on behalf of, the Depository.  The Notes shall not be issuable in Definitive Notes except as provided in Section 3.12 of this Second Supplemental Indenture.  The Notes and the Trustee’s certificate of authentication shall be substantially in the form attached as Exhibit A hereto.  The Company shall execute each Global Note and each Definitive Note, if any.  The Trustee shall, in accordance with Section 3.3 of the Base Indenture, authenticate and hold each Global Note as custodian for the Depository, and authenticate each Definitive Note, if any.  Each Global Note will represent such of the outstanding Notes as will be specified therein and each shall provide that it represents the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate principal amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions.  Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby will be made by the Trustee or a custodian at the direction of the Trustee.  The terms and provisions contained in the form of Note attached as Exhibit A hereto shall constitute, and are hereby expressly made, a part of the Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Second Supplemental Indenture, expressly agree to such terms and provisions and to be bound thereby.

 

Section 3.12.   Transfer and Exchange.

 

(a)        Transfer and Exchange of Global Notes.  A Global Note may not be transferred except as a whole by the Depository to a nominee of the Depository, by a nominee of the Depository to the Depository or to another nominee of the Depository, or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository.  All Global Notes will be exchanged by the Company for Definitive Notes if:

 

(i)         the Company delivers to the Trustee notice from the Depository that it is unwilling or unable to continue to act as Depository or that it is no longer a clearing agency registered under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and, in either case, a successor Depository is not appointed by the Company within ninety (90) days after the date of such notice from the Depository; or

 

- 10 -

 

(ii)        the Company in its sole discretion determines that the Global Notes (in whole but not in part) should be exchanged for Definitive Notes and delivers a written notice to such effect to the Trustee.

 

Upon the occurrence of either of the preceding events in (i) or (ii) above, Definitive Notes shall be issued in such names as the Depository shall instruct the Trustee.  Global Notes also may be exchanged or replaced, in whole or in part, as provided in Sections 3.4 and 3.6 of the Base Indenture.  Every Note authenticated and delivered in exchange for, or in lieu of, a Global Note or any portion thereof, pursuant to this Section 3.12 or Sections 3.4 and 3.6 of the Base Indenture, shall be authenticated and delivered in the form of, and shall be, a Global Note.  A Global Note may not be exchanged for another Note other than as provided in this Section 3.12(a), however, beneficial interests in a Global Note may be transferred and exchanged as provided in Section 3.12(c) or (d) hereof.

 

(b)        Legend.  Any Global Note issued under this Second Supplemental Indenture shall bear a legend in substantially the following form:

 

“THIS GLOBAL NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE BASE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 3.12 OF THE SECOND SUPPLEMENTAL INDENTURE, (II) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 3.12 OF THE SECOND SUPPLEMENTAL INDENTURE, (III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 3.9 OF THE BASE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.

 

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”) TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE 

 

- 11 -

 

REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

 

(c)        Transfer and Exchange of Beneficial Interests in the Global Notes.  The transfer and exchange of beneficial interests in the Global Notes will be effected through the Depository, in accordance with the provisions of the Indenture and the Applicable Procedures.  Transfers of beneficial interests in the Global Notes will require compliance with either subparagraph (i) or (ii) below, as applicable:

 

(i)         Transfer of Beneficial Interests in the Same Global Note.  Beneficial interests in any Global Note may be transferred to persons who take delivery thereof in the form of a beneficial interest in a Global Note.  No written orders or instructions shall be required to be delivered to the Security Registrar to effect the transfers described in this Section 3.12(c)(i).

 

(ii)        All Other Transfers of Beneficial Interests in Global Notes.  In connection with all transfers of beneficial interests that are not subject to Section 3.12(c)(i) above, the transferor of such beneficial interest must deliver to the Security Registrar both:

 

(A)       a written order from a Participant or an Indirect Participant given to the Depository in accordance with the Applicable Procedures directing the Depository to credit or cause to be credited a beneficial interest in another Global Note in an amount equal to the beneficial interest to be transferred or exchanged; and

 

(B)       instructions given in accordance with the Applicable Procedures containing information regarding the Participant account to be credited with such increase.

 

Upon satisfaction of all of the requirements for transfer or exchange of beneficial interests in Global Notes contained in the Indenture and the Notes or otherwise applicable under the Securities Act, the Trustee shall adjust the principal amount of the relevant Global Note(s) pursuant to Section 3.12(g) hereof.

 

(d)       Transfer and Exchange of Beneficial Interests in Global Notes for Definitive Notes.  If any holder of a beneficial interest in a Global Note proposes to exchange such beneficial interest for a Definitive Note or to transfer such beneficial interest to a person who takes delivery thereof in the form of a Definitive Note, then, upon satisfaction of the conditions set forth in Section 3.12(c)(ii) hereof and receipt of a Company Order, the Trustee will cause the aggregate principal amount of the applicable Global Note to be reduced accordingly pursuant to Section 3.12(g) hereof, and the Company will execute and the Trustee will authenticate and deliver to the person designated in the instructions a Definitive Note in the appropriate principal amount.  Any Definitive Note issued in exchange for a beneficial interest pursuant to this Section 3.12(d) will be registered in such name or names and in such authorized denomination or denominations as the holder of such beneficial interest requests through

 

- 12 -

 

instructions to the Security Registrar from or through the Depository and the Participant or Indirect Participant.  The Trustee will deliver such Definitive Notes to the persons in whose names such Notes are so registered.

 

(e)        Transfer and Exchange of Definitive Notes for Beneficial Interests in Global Notes.  A Holder of a Definitive Note may exchange such Note for a beneficial interest in a Global Note or transfer such Definitive Notes to a person who takes delivery thereof in the form of a beneficial interest in a Global Note at any time.  Upon receipt of a written request for such an exchange or transfer, the Trustee will cancel the applicable Definitive Note and increase or cause to be increased the aggregate principal amount of one of the Global Notes.

 

If any such exchange or transfer from a Definitive Note to a beneficial interest is effected pursuant to the previous paragraph at a time when a Global Note has not yet been issued, the Company will issue and, upon receipt of a Company Order in accordance with Section 3.12 hereof, the Trustee will authenticate one or more Global Notes in an aggregate principal amount equal to the principal amount of Definitive Notes so transferred.

 

(f)        Transfer and Exchange of Definitive Notes for Definitive Notes.  Upon request by a Holder of Definitive Notes and such Holder’s compliance with the provisions of this Section 3.12(f), the Security Registrar will register the transfer or exchange of Definitive Notes.  Prior to such registration of transfer or exchange, the requesting Holder will present or surrender to the Security Registrar the Definitive Notes duly endorsed or accompanied by a written instruction of transfer in form satisfactory to the Security Registrar duly executed by such Holder or by his attorney, duly authorized in writing.  A Holder of Definitive Notes may transfer such Notes to a person who takes delivery thereof in the form of a Definitive Note.  Upon receipt of a written request to register such a transfer, the Security Registrar shall register the Definitive Notes pursuant to the instructions from the Holder thereof.

 

(g)        Cancellation and/or Adjustment of Global Notes.  At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note will be returned to or retained and canceled by the Trustee in accordance with Section 3.9 of the Base Indenture.  At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by such Global Note will be reduced accordingly and an endorsement will be made on such Global Note by the Trustee or by the Depository at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note will be increased accordingly and an endorsement will be made on such Global Note by the Trustee or by the Depository at the direction of the Trustee to reflect such increase.

 

- 13 -

 

Section 3.13.   General Provisions Relating to Transfers and Exchanges.

 

(a)        To permit registrations of transfers and exchanges, the Company will execute and the Trustee will authenticate Global Notes and Definitive Notes upon receipt of a Company Order in accordance with Section 3.12 hereof.

 

(b)        No service charge will be made to a Holder of a beneficial interest in a Global Note or to a Holder of a Definitive Note for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer taxes or similar governmental charge payable upon exchange or transfer pursuant to Sections 3.4 and 9.6 of the Base Indenture).

 

(c)        The Security Registrar will not be required to register the transfer of or exchange of any Note selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part.

 

(d)       All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes will be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under the Indenture, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange.

 

(e)        Neither the Security Registrar nor the Company will be required:

 

(i)         to issue, register the transfer of or to exchange any Note during a period beginning at the opening of business fifteen (15) days before any selection of Notes for redemption under Article IV hereof and ending at the close of business on the earliest date on which the relevant notice of redemption is deemed to have been given to all Holders of Notes to be so redeemed; or

 

(ii)        to register the transfer of or to exchange any Note so selected for redemption in whole or in part, except the unredeemed portion of any Note being redeemed in part; or

 

(iii)       to register the transfer of or to exchange a Note between a Record Date and the next succeeding Interest Payment Date.

 

(f)        Prior to due presentment for the registration of a transfer of any Note, the Trustee and the Company may deem and treat the person in whose name any Note is registered as the absolute owner of such Note for the purpose of receiving payment of principal of and interest on such Notes and for all other purposes, and none of the Trustee or the Company shall be affected by notice to the contrary.

 

(g)        The Trustee will authenticate Global Notes and Definitive Notes in accordance with the provisions of Section 3.3 of the Base Indenture.

 

- 14 -

 

(h)        All certifications, certificates and Opinions of Counsel required to be submitted to the Security Registrar pursuant to this Article III to effect a registration of transfer or exchange may be submitted by facsimile.

 

ARTICLE IV

 

REDEMPTION

 

The provisions of Article XI of the Base Indenture, as amended by the provisions of this Second Supplemental Indenture, shall apply to the Notes.

 

Section 4.1.     Optional Redemption.

 

(a)        At any time before October 15, 2026, the Company shall have the right to redeem the Notes at its option and in its sole discretion, in whole or from time to time in part.  The redemption price (“Redemption Price”) shall be equal to the sum of (1) the principal amount of the Notes being redeemed, (2) accrued and unpaid interest thereon to, but excluding, the Redemption Date, and (3) the Make-Whole Amount, if any (subject to the right of holders of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date).  Notwithstanding the foregoing, the Redemption Price for any redemption of the Notes on or after October 15, 2026 shall be equal to the sum of (1) the principal amount of the Notes being redeemed and (2) accrued and unpaid interest thereon to, but excluding, the Redemption Date.

 

(b)        The Company shall not redeem the Notes pursuant to Section 4.1(a) hereof on any date if the principal amount of the Notes has been accelerated, and such an acceleration has not been rescinded or cured on or prior to such date (except in the case of an acceleration resulting from a default by the Company in the payment of the Redemption Price with respect to the Notes to be redeemed).

 

Section 4.2.     Notice of Optional Redemption; Selection of Notes.  In case the Company shall desire to exercise the right to redeem all or, as the case may be, any part of the Notes pursuant to Section 4.1 hereof, it shall fix a date for redemption and it or, at its written request received by the Trustee not fewer than five (5) Business Days prior (or such shorter period of time as may be acceptable to the Trustee) to the date the notice of redemption is to be delivered, the Trustee in the name of and at the expense of the Company, shall deliver or cause to be delivered a notice of such redemption not fewer than thirty (30) calendar days nor more than sixty (60) calendar days prior to the Redemption Date to each Holder of Notes so to be redeemed in whole or in part at its last address as the same appears on the register; provided that if the Company makes such request of the Trustee, it shall, together with such request, also give written notice of the Redemption Date to the Trustee; provided further that the text of the notice shall be prepared by the Company.  The notice, if delivered in the manner herein provided, shall be conclusively presumed to have been duly given, whether or not the Holder receives such notice.  In any case, failure to give such notice or any defect in the notice to the Holder of any Note designated for redemption as a whole or in part shall not affect the validity of the proceedings for the redemption of any other Note.  Any such notice of redemption may, in the Company’s sole discretion, be conditioned on the occurrence of one or more events, facts and circumstances.

 

- 15 -

 

Each such notice of redemption shall specify:  (i) the aggregate principal amount of Notes to be redeemed, (ii) the CUSIP number or numbers, if any, of the Notes being redeemed, (iii) the Redemption Date (which shall be a Business Day), (iv) the Redemption Price at which Notes are to be redeemed, (v) the place or places of payment and that payment will be made upon presentation and surrender of such Notes and (vi) that interest accrued and unpaid to, but excluding, the Redemption Date will be paid as specified in said notice, and that, unless the Company defaults in the payment of the Redemption Price, on and after said date interest thereon or on the portion thereof to be redeemed will cease to accrue.  If fewer than all the Notes are to be redeemed, the notice of redemption shall identify the Notes to be redeemed (including CUSIP numbers, if any).  In case any Note is to be redeemed in part only, the notice of redemption shall state the portion of the principal amount thereof to be redeemed and shall state that, on and after the Redemption Date, upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion thereof will be issued.

 

Whenever any Notes are to be redeemed, the Company will give the Trustee written notice of the Redemption Date as to the aggregate principal amount of Notes to be redeemed not fewer than thirty (30) calendar days prior to the Redemption Date.

 

On or prior to the Redemption Date specified in the notice of redemption given as provided in this Section 4.2, the Company will deposit with the Paying Agent an amount of monies in immediately available funds sufficient to redeem on the Redemption Date all the Notes (or portions thereof) so called for redemption at the appropriate Redemption Price; provided that if such payment is made on the Redemption Date, it must be received by the Paying Agent, by 11:00 a.m., New York City time, on such date.

 

If less than all of the outstanding Notes are to be redeemed, the Trustee shall select the Notes or portions thereof of the Global Note or the Notes in certificated form to be redeemed (in principal amounts of $2,000 and integral multiples of $1,000 in excess thereof), on a pro rata basis or such other method the Trustee deems fair and appropriate or is required by the Depository.  The Notes (or portions thereof) so selected for redemption shall be deemed duly selected for redemption for all purposes hereof.

 

Section 4.3.     Payment of Notes Called for Redemption by the Company.  If notice of redemption has been given as provided in Section 4.2 hereof, the Notes or portion of Notes with respect to which such notice has been given shall become due and payable on the Redemption Date and at the place or places stated in such notice at the Redemption Price, and unless the Company shall default in the payment of such Notes at the Redemption Price, so long as the Paying Agent holds funds sufficient to pay the Redemption Price of the Notes to be redeemed on the Redemption Date, then (a) such Notes will cease to be outstanding on and after the Redemption Date, (b) interest on the Notes or portion of Notes so called for redemption shall cease to accrue on and after the Redemption Date, (c) on and after the Redemption Date (unless the Company shall default in the payment of the Redemption Price), such Notes will cease to be entitled to any benefit or security under this Indenture, and (d) the Holders of the Notes shall have no right in respect of such Notes except the right to receive the Redemption Price thereof.  On presentation and surrender of such Notes at a place of payment in said notice specified, the said Notes or the specified portions thereof shall be paid and redeemed by the Company at the Redemption Price.

 

- 16 -

 

Upon presentation of any Note redeemed in part only, the Company shall execute and the Trustee shall authenticate and make available for delivery to the Holder thereof, at the expense of the Company, a new Note or Notes, of authorized denominations, in principal amount equal to the unredeemed portion of the Notes so presented.

 

ARTICLE V

 

GUARANTEE

 

This Article V shall replace Article XIV of the Base Indenture with respect to the Notes only.

 

Section 5.1.     Guarantee.  By its execution hereof, the Guarantor acknowledges and agrees that the Notes shall be entitled to the benefits of a Guarantee.  Accordingly, subject to the provisions of this Article V, the Guarantor hereby unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and its successors and assigns that:  (i) the principal of (including the Redemption Price upon redemption pursuant to Article IV hereof), premium, if any, and interest, if any, on the Notes shall be duly and punctually paid in full when due, whether at the Maturity Date, upon acceleration, upon redemption or otherwise, and interest on overdue principal, premium, if any, and (to the extent permitted by law) interest on any interest, if any, on the Notes and all other obligations of the Company to the Holders or the Trustee hereunder or under the Notes (including fees, expenses or other) shall be promptly paid in full or performed, all in accordance with the terms hereof; and (ii) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, the same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at the Maturity Date, by acceleration, call for redemption or otherwise, subject, however, in the case of clauses (i) and (ii) above, to the limitations set forth in this Article V (collectively, the “Guarantee Obligations”).

 

Subject to the provisions of this Article V, the Guarantor hereby agrees that its Guarantee hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or the Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any thereof, the entry of any judgment against the Company, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of the Guarantor.  The Guarantor hereby waives and relinquishes:  (a) any right to require the Trustee, the Holders or the Company (each, a “Benefited Party”) to proceed against the Company or any other person or to proceed against or exhaust any security held by a Benefited Party at any time or to pursue any other remedy in any secured party’s power before proceeding against the Guarantor; (b) any defense that may arise by reason of the incapacity, lack of authority, death or disability of any other person or persons or the failure of a Benefited Party to file or enforce a claim against the estate (in administration, bankruptcy or any other proceeding) of any other person or persons; (c) demand, protest and notice of any kind (except as expressly required by the Indenture), including but not limited to notice of the existence, creation or incurring of any new or additional indebtedness or obligation or of any action or non-action on the part of the Guarantor, any Benefited Party, any creditor of the Guarantor or the Company or on the part of any other person whomsoever in connection with any obligations the performance of which are hereby guaranteed; (d) any

 

- 17 -

 

defense based upon an election of remedies by a Benefited Party, including but not limited to an election to proceed against the Guarantor for reimbursement; (e) any defense based upon any statute or rule of law which provides that the obligation of a surety must be neither larger in amount nor in other respects more burdensome than that of the principal; (f) any defense arising because of a Benefited Party’s election, in any proceeding instituted under the Bankruptcy Law, of the application of Section 1111(b)(2) of the Bankruptcy Law; and (g) any defense based on any borrowing or grant of a security interest under Section 364 of the Bankruptcy Law.  The Guarantor hereby covenants that, except as otherwise provided therein, the Guarantee shall not be discharged except by payment in full of all Guarantee Obligations, including, but not limited to, the principal, premium, if any, and interest on the Notes and all other costs provided for under the Indenture.

 

If any Holder or the Trustee is required by any court or otherwise to return to either the Company or the Guarantor, or any trustee or similar official acting in relation to either the Company or the Guarantor, any amount paid by the Company or the Guarantor to the Trustee or such Holder, the Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.  The Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any Guarantee Obligations hereby until payment in full of all such obligations guaranteed hereby.  The Guarantor agrees that, as between it, on the one hand, and the Holders of Notes and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article V of the Base Indenture for the purposes hereof, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guarantee Obligations, and (y) in the event of any acceleration of such obligations as provided in Article V of the Base Indenture, such Guarantee Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purpose of the Guarantee.

 

Section 5.2.     Execution and Delivery of Guarantee.

 

(a)        To evidence the Guarantee set forth in Section 5.1 hereof, the Guarantor agrees that a Notation of Guarantee substantially in the form included in Exhibit B hereto shall be endorsed on each Note authenticated and delivered by the Trustee and that this Second Supplemental Indenture shall be executed on behalf of the Guarantor by an Officer of the sole general partner of the Guarantor.

 

(b)        The Guarantor agrees that the Guarantee set forth in this Article V shall remain in full force and effect and apply to all the Notes notwithstanding any failure to endorse on each Note a notation of the Guarantee.

 

(c)        If an Officer whose facsimile signature is on a Note or a notation of Guarantee no longer holds that office at the time the Trustee authenticates the Note on which the Guarantee is endorsed, the Guarantee shall be valid nevertheless.

 

(d)       The delivery of any Note by the Trustee, after the authentication thereof hereunder, shall constitute due delivery of the Guarantee set forth in this Second Supplemental Indenture on behalf of the Guarantor.

 

- 18 -

 

Section 5.3.     Limitation of Guarantor’s Liability; Certain Bankruptcy Events.

 

(a)        The Guarantor, and by its acceptance hereof each Holder, hereby confirms that it is the intention of all such parties that the Guarantee Obligations of the Guarantor pursuant to its Guarantee not constitute a fraudulent transfer or conveyance for purposes of any Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law.  To effectuate the foregoing intention, the Holders and the Guarantor hereby irrevocably agree that the Guarantee Obligations of the Guarantor under this Article V shall be limited to the maximum amount as shall, after giving effect to all other contingent and fixed liabilities of the Guarantor, result in the Guarantee Obligations of the Guarantor under the Guarantee not constituting a fraudulent transfer or conveyance.

 

(b)        The Guarantor hereby covenants and agrees, to the fullest extent that it may do so under applicable law, that in the event of the insolvency, bankruptcy, dissolution, liquidation or reorganization of the Company, the Guarantor shall not file (or join in any filing of), or otherwise seek to participate in the filing of, any motion or request seeking to stay or to prohibit (even temporarily) execution on the Guarantee and hereby waives and agrees not to take the benefit of any such stay of execution, whether under Section 362 or 105 of the Bankruptcy Law or otherwise.

 

Section 5.4.     Application of Certain Terms and Provisions to the Guarantor.

 

(a)        For purposes of any provision of the Indenture which provides for the delivery by the Guarantor of an Officers’ Certificate and/or an Opinion of Counsel, the definitions of such terms in Section 2.1 hereof shall apply to the Guarantor as if references therein to the Company or the Guarantor, as applicable, were references to the Guarantor; provided that, in the case of any Officers’ Certificate delivered by the Guarantor, the definition of the term “Officer” shall be deemed to include the general partner of the Guarantor.

 

(b)        Upon any demand, request or application by the Guarantor to the Trustee to take any action under the Indenture, the Guarantor shall furnish to the Trustee such certificates and opinions as are required in Section 1.2 of the Base Indenture, as if all references therein to the Company were references to the Guarantor.

 

ARTICLE VI

 

ADDITIONAL COVENANTS

 

The following additional covenants shall apply with respect to the Notes so long as any of the Notes remain outstanding.

 

Section 6.1.     Maintenance of Office or Agency.  The Company will maintain an office or agency in the United States where the Notes may be surrendered for registration of transfer or exchange or for presentation for payment or redemption and where notices and demands to or upon the Company in respect of the Notes and the Indenture may be served.  As of the date of the Indenture, such office shall be the Corporate Trust Office and, at any other time, at such other address as the Trustee may designate from time to time by notice to the Company.  The Company will give prompt written notice to the Trustee of the location, and any change in the

 

- 19 -

 

location, of such office or agency not designated or appointed by the Trustee.  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the Corporate Trust Office; provided that the Corporate Trust Office shall not be an office for service of legal process on the Company or any Guarantor.

 

The Company may also from time to time designate co-registrars and one or more offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations.  The Company will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

 

The Company hereby initially designates the Trustee as Paying Agent and Security Registrar and the Corporate Trust Office shall be considered as one such office or agency of the Company for each of the aforesaid purposes.

 

Section 6.2.     Appointments to Fill Vacancies in Trustee’s Office.  The Company, whenever necessary to avoid or fill a vacancy in the office of Trustee, will appoint, upon the terms and conditions and otherwise as provided in Section 6.11 of the Base Indenture, a Trustee, so that there shall at all times be a Trustee hereunder.

 

Section 6.3.     Limitations on Incurrence of Debt.

 

(a)        The Company will not, and will not permit any of its Subsidiaries to, incur any Debt, other than Intercompany Debt and guarantees of Debt incurred by the Company or its Subsidiaries in compliance with this Indenture, if, immediately after giving effect to the incurrence of such Debt and the application of the proceeds thereof, the aggregate principal amount of all of the Company’s and its Subsidiaries’ outstanding Debt on a consolidated basis determined in accordance with GAAP is greater than 60% of the sum of (without duplication) (1) Total Assets as of the end of the calendar quarter covered in the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, most recently filed with the Commission (or, if such filing is not permitted under the Exchange Act, with the Trustee) prior to the incurrence of such additional Debt and (2) the purchase price of any real estate assets or mortgages receivable acquired, and the amount of any securities offering proceeds received (to the extent such proceeds were not used to acquire real estate assets or mortgages receivable or used to reduce Debt), by the Company or any of its Subsidiaries since the end of such calendar quarter, including those proceeds obtained in connection with the incurrence of such additional Debt.

 

(b)        The Company will not, and will not permit any of its Subsidiaries to, incur any Debt, other than Intercompany Debt and guarantees of Debt incurred by the Company or its Subsidiaries in compliance with this Indenture, secured by any mortgage, lien, charge, pledge, encumbrance or security interest of any kind upon any of the Company’s or any of its Subsidiaries’ property if, immediately after giving effect to the incurrence of such Debt and the application of the proceeds thereof, the aggregate principal amount of all of the Company’s and its Subsidiaries’ outstanding Debt on a consolidated basis which is secured by any mortgage, lien, charge, pledge, encumbrance or security interest on the Company’s or its Subsidiaries’

 

- 20 -

 

property is greater than 40% of the sum of (without duplication) (1) Total Assets as of the end of the calendar quarter covered in the Company’s Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as the case may be, most recently filed with the Commission (or, if such filing is not permitted under the Exchange Act, with the Trustee) prior to the incurrence of such additional Debt and (2) the purchase price of any real estate assets or mortgages receivable acquired, and the amount of any securities offering proceeds received (to the extent such proceeds were not used to acquire real estate assets or mortgages receivable or used to reduce Debt), by the Company or any of its Subsidiaries since the end of such calendar quarter, including those proceeds obtained in connection with the incurrence of such additional Debt; provided that for purposes of this limitation, the amount of obligations under capital leases shown as a liability on the Company’s consolidated balance sheet shall be deducted from Debt and from Total Assets.

 

(c)        The Company will not, and will not permit any of its Subsidiaries to, incur any Debt, other than Intercompany Debt and guarantees of Debt by the Company or its Subsidiaries in compliance with this Indenture, if the ratio of Consolidated EBITDA to Interest Expense for the four consecutive fiscal quarters most recently ended prior to the date on which such additional Debt is to be incurred shall have been less than 1.5 to 1.0, on an unaudited pro forma basis after giving effect to the incurrence of such additional Debt and to the application of the proceeds therefrom, and calculated on the assumption that:  (1) such Debt and any other Debt incurred by the Company and its Subsidiaries since the first day of such four-quarter period and the application of the proceeds therefrom, including to refinance other Debt, had occurred at the beginning of such period (except that, in making such computation, the amount of Debt under any revolving credit facility shall be computed based on the average daily balance of such Debt during such period); (2) the repayment or retirement of any other Debt by the Company and its Subsidiaries since the first day of such four-quarter period had been repaid or retired at the beginning of such period (except that, in making such computation, the amount of Debt under any revolving credit facility shall be computed based upon the average daily balance of such Debt during such period); (3) in the case of Acquired Debt or Debt incurred in connection with any acquisition since the first day of such four-quarter period, the related acquisition had occurred as of the first day of such period, with the appropriate adjustments with respect to such acquisition being included in such unaudited pro forma calculation; and (4) in the case of any acquisition or disposition by the Company or its Subsidiaries of any asset or group of assets or other placement of any assets in service or removal of any assets from service by the Company or any of its Subsidiaries since the first day of such four-quarter period, whether by merger, stock purchase or sale, or asset purchase or sale, such acquisition, disposition, placement in service or removal from service, or any related repayment of Debt had occurred as of the first day of such period, with the appropriate adjustments with respect to such acquisition, disposition, placement in service or removal from service, being included in such unaudited pro forma calculation and determined reasonably and in good faith by the Company. If the Debt giving rise to the need to make the foregoing calculation or any other Debt incurred after the first day of the relevant four-quarter period bears interest at a floating rate then, for purposes of calculating the Interest Expense, the interest rate on such Debt shall be computed on a pro forma basis as if the average interest rate which would have been in effect during the entire such four-quarter period had been the applicable rate for the entire such period.

 

- 21 -

 

(d)       The Company, together with its Subsidiaries, will at all times maintain an Unencumbered Total Asset Value in an amount not less than 150% of the aggregate outstanding principal amount of all the Company’s and its Subsidiaries’ unsecured Debt, taken as a whole.

 

(e)        The Company will, and will cause each of its Subsidiaries to, maintain insurance with financially sound and reputable insurance companies against such risks and in such amounts as is customarily maintained by persons engaged in similar businesses or as may be required by applicable law.

 

ARTICLE VII

 

DEFAULTS AND REMEDIES

 

Sections 7.1, 7.2, 7.3 and 7.4 hereof shall replace Sections 5.1, 5.2, 5.7, and 6.2 respectively, of the Base Indenture with respect to the Notes only.

 

Section 7.1.     Events of Default.

 

“Event of Default,” wherever used herein or in the Base Indenture with respect to the Notes, means any one of the following events:

 

(a)        default in the payment of any interest on the Notes when it becomes due and payable, and continuance of that default for a period of thirty (30) days (unless the entire amount of the payment is deposited by the Company with the Trustee or with a Paying Agent prior to the expiration of such 30-day period);

 

(b)        default in the payment of principal of, premium on or Redemption Price due with respect to, the Notes when the same become due and payable;

 

(c)        failure to pay any Debt of the Company, the Guarantor or any Significant Subsidiary in an outstanding principal amount in excess of $50,000,000 at final maturity or upon acceleration after the expiration of any applicable grace period, which Debt is not discharged, or such default in payment or acceleration is not cured or rescinded, within sixty (60) calendar days after written notice to the Company from the Trustee (or to the Company and the Trustee from Holders of at least 25% in aggregate principal amount of the Notes then outstanding);

 

(d)       except as permitted by the Indenture and the Notes, the Guarantee by the Guarantor shall cease to be in full force and effect or the Guarantor shall deny or disaffirm its obligations with respect thereto;

 

(e)        default in the performance or breach of any other covenant or warranty by the Company or the Guarantor in the Indenture (other than a covenant or warranty that has been included in the Indenture solely for the benefit of a series of debt securities other than the Notes), which default continues uncured for a period of ninety (90) calendar days after the Company receives written notice from the Trustee or the Company and the Trustee receive written notice from the Holders of at least 25% in aggregate principal amount of the Notes then outstanding; and

 

- 22 -

 

(f)        the Company, the Guarantor or any Significant Subsidiary pursuant to or under or within meaning of any Bankruptcy Law:

 

(i)         commences a voluntary case or proceeding seeking liquidation, reorganization or other relief with respect to the Company, the Guarantor or a Significant Subsidiary or its debts or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of the Company, the Guarantor or a Significant Subsidiary or any substantial part of the property of the Company, the Guarantor or a Significant Subsidiary; or

 

(ii)        consents to any such relief or to the appointment of or taking possession by any such official in an involuntary case or other proceeding commenced against the Company, the Guarantor or a Significant Subsidiary; or

 

(iii)       consents to the appointment of a Custodian of it or for all or substantially of its property; or

 

(iv)       makes a general assignment for the benefit of creditors; or

 

(v)        generally is unable to pay its debts as the same become due, or

 

(g)        an involuntary case or other proceeding shall be commenced against the Company, the Guarantor or any Significant Subsidiary seeking liquidation, reorganization or other relief with respect to the Company, the Guarantor or a Significant Subsidiary or its debts under any bankruptcy, insolvency or other similar law now or hereafter in effect or seeking the appointment of a trustee, receiver, liquidator, custodian or other similar official of the Company, the Guarantor or a Significant Subsidiary or any substantial part of the property of the Company, the Guarantor or a Significant Subsidiary, and such involuntary case or other proceeding shall remain undismissed and unstayed for a period of sixty (60) calendar days; or

 

(h)        a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that

 

(i)         is for relief against the Company, the Guarantor or any of Significant Subsidiary in an involuntary case or proceeding;

 

(ii)        appoints a Custodian of the Company, the Guarantor or a Significant Subsidiary or any substantial part of the property of the Company, the Guarantor or a Significant Subsidiary; or

 

(iii)       orders the liquidation of the Company, the Guarantor or a Significant Subsidiary; and, in each case in this clause (h), the order or decree remains unstayed and in effect for sixty (60) calendar days.

 

The term “Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

 

Section 7.2.     Acceleration of Maturity; Rescission and Annulment.  If an Event of Default with respect to the Notes at the time outstanding occurs and is continuing (other than an

 

- 23 -

 

Event of Default referred to in Section 7.1 (f), (g) or (h) hereof), then in every such case the Trustee or the Holders of not less than 25% in principal amount of the outstanding Notes may, by a notice in writing to the Company (and to the Trustee if given by the Holders), declare to be due and payable immediately the principal of, and accrued and unpaid interest, if any, on all of the Notes, and upon any such declaration such principal amount (or specified amount) and accrued and unpaid interest, if any, shall become immediately due and payable.  If an Event of Default specified in Section 7.1 (f), (g) or (h) hereof shall occur, the principal amount (or specified amount) of and accrued and unpaid interest, if any, on all outstanding Notes will automatically become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder of outstanding Notes.

 

At any time after a declaration of acceleration with respect to Notes has been made, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the Holders of a majority in principal amount of the outstanding Notes, by written notice to the Company and the Trustee, may rescind and annul such declaration and the acceleration if all Events of Default, other than the non-payment of accelerated principal and interest, if any, with respect to the Notes, have been cured or waived as provided in Section 5.13 of the Base Indenture.  No such rescission and annulment shall extend to or shall affect any subsequent default or Event of Default, or shall impair any right consequent thereon.

 

Section 7.3.     Limitation on Suits.  No Holder of the Notes shall have any right to institute any proceeding, judicial or otherwise, with respect to the Indenture or for the appointment of a receiver or trustee, or for any remedy under the Indenture, unless:

 

(a)        such Holder has previously given to the Trustee written notice of a continuing Event of Default with respect to the Notes;

 

(b)        the Holders of at least 25% in principal amount of the outstanding Notes shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder,

 

(c)        such Holder or Holders have offered to the Trustee reasonable indemnity against the costs, expenses and liabilities to be incurred in compliance with such request;

 

(d)       the Trustee for sixty (60)  days after its receipt of such notice, request and offer of indemnity has failed to institute any such proceeding; and

 

(e)        no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of at least 25% in principal amount of the outstanding Notes.

 

Section 7.4.     Notice of Defaults.  If an Event of Default occurs and is continuing with respect to the Notes and if it is actually known to a Responsible Officer of the Trustee, the Trustee will send to Holders of Notes a notice of the Default or Event of Default within 90 days after it occurs, unless such default shall have been cured or waived.  Except in the case of a Default or Event of Default in payment of principal of, premium, if any, or interest on the Notes, the Trustee may withhold the notice if and so long as a Responsible Officer determines that withholding the notice is in the interests of the Holders of the Notes.

 

- 24 -

 

ARTICLE VIII

 

AMENDMENTS AND WAIVERS

 

Section 8.1 hereof shall replace Section 9.1 of the Base Indenture with respect to the Notes only.

 

Section 8.1.     Without Consent of Holders.  The Company, when authorized by the resolutions of the Board of Directors, the Guarantor and the Trustee may, from time to time, and at any time enter into an indenture or indentures supplemental without the consent of the Holders of the Notes hereto for one or more of the following purposes:

 

(a)        to cure any ambiguity, defect or inconsistency in the Indenture; provided that this action shall not adversely affect the interests of the Holders of the Notes in any material respect, as determined by the Board of Directors of the Company;

 

(b)        to evidence a successor to the Company as obligor or to the Guarantor as guarantor in accordance with Section 8.4 of the Base Indenture;

 

(c)        to make any change that does not adversely affect the interests of the Holders of any Notes then outstanding;

 

(d)       to provide for the issuance of Additional Notes in accordance with the limitations set forth in the Indenture;

 

(e)        to provide for the acceptance of appointment of a successor Trustee or facilitate the administration of the trusts under the Indenture by more than one Trustee;

 

(f)        to comply with the requirements of the Commission in order to effect or maintain the qualification of the Indenture under the Trust Indenture Act;

 

(g)        to reflect the release of the Guarantor as guarantor, in accordance with the Indenture;

 

(h)        to secure the Notes;

 

(i)         to add guarantors with respect to the Notes; and

 

(j)         to conform the text of the Indenture, any Guarantee or the Notes to any provision of the description thereof set forth in the Prospectus to the extent that such provision in the Prospectus was intended to be a verbatim recitation of a provision of the Indenture, such Guarantee or the Notes (as certified in an Officers’ Certificate).

 

Upon the written request of the Company, accompanied by a copy of the resolutions of each of the Board of Directors of the Company and the Board of Directors of the sole general partner of the Guarantor authorizing the execution of any supplemental indenture and the

 

- 25 -

 

delivery of the documents required by Section 9.3 of the Base Indenture, the Trustee is hereby authorized to join with the Company and the Guarantor in the execution of any such supplemental indenture, to make any further appropriate agreements and stipulations that may be therein contained and to accept the conveyance, transfer and assignment of any property thereunder, but the Trustee shall not be obligated to, but may in its discretion, enter into any supplemental indenture that affects the Trustee’s own rights, duties or immunities under the Indenture or otherwise.

 

Any supplemental indenture authorized by the provisions of this Section 8.1 may be executed by the Company, the Guarantor and the Trustee without the consent of the Holders of any of the Notes at the time outstanding, notwithstanding any of the provisions of Section 9.2 of the Base Indenture.

 

ARTICLE IX

 

MEETINGS OF HOLDERS OF NOTES

 

Section 9.1.     Purposes for Which Meetings May Be Called.  A meeting of Holders may be called at any time and from time to time pursuant to this Article IX to make, give or take any request, demand, authorization, direction, notice, consent, waiver or other act provided by the Indenture to be made, given or taken by Holders.

 

Section 9.2.     Call, Notice and Place of Meetings.

 

(a)        The Trustee may at any time call a meeting of Holders for any purpose specified in Section 9.1 hereof, to be held at such time and at such place as the Trustee shall determine.  Notice of every meeting of Holders, setting forth the time and the place of such meeting and in general terms the action proposed to be taken at such meeting, shall be given, in the manner provided in Section 1.6 of the Base Indenture, not less than twenty-one (21) nor more than one hundred eighty (180) days prior to the date fixed for the meeting.

 

(b)        In case at any time the Company, the Guarantor or the Holders of at least 25% in principal amount of the outstanding Notes shall have requested the Trustee to call a meeting of the Holders for any purpose specified in Section 9.1 hereof, by written request setting forth in reasonable detail the action proposed to be taken at the meeting, and the Trustee shall not have mailed notice of or made the first publication of the notice of such meeting within twenty-one (21) days after receipt of such request or shall not thereafter proceed to cause the meeting to be held as provided herein, then the Company, the Guarantor, if applicable, or the Holders in the amount above specified, as the case may be, may determine the time and the place for such meeting and may call such meeting for such purposes by giving notice thereof as provided in clause (a) of this Section.

 

Section 9.3.     Persons Entitled to Vote at Meetings.  To be entitled to vote at any meeting of Holders, a person shall be (1) a Holder of one or more outstanding Notes, or (2) a person appointed by an instrument in writing as proxy for a Holder or Holders of one or more outstanding Notes by such Holder or Holders; provided, that none of the Company, any other obligor upon the Notes or any Affiliate of the Company shall be entitled to vote at any meeting

 

- 26 -

 

of Holders or be counted for purposes of determining a quorum at any such meeting in respect of any Notes owned by such persons.  The only persons who shall be entitled to be present or to speak at any meeting of Holders shall be the persons entitled to vote at such meeting and their counsel, any representatives of the Trustee and its counsel, any representatives of the Guarantor and its counsel and any representatives of the Company and its counsel.

 

Section 9.4.     Quorum; Action.  The persons entitled to vote a majority in principal amount of the outstanding Notes shall constitute a quorum for a meeting of Holders; provided, however, that if any action is to be taken at the meeting with respect to a consent or waiver which may be given by the Holders of not less than a specified percentage in principal amount of the outstanding Notes, the persons holding or representing the specified percentage in principal amount of the outstanding Notes will constitute a quorum.  In the absence of a quorum within thirty (30) minutes after the time appointed for any such meeting, the meeting shall, if convened at the request of Holders, be dissolved.  In any other case the meeting may be adjourned for a period of not less than ten (10) days as determined by the chairman of the meeting prior to the adjournment of such meeting.  In the absence of a quorum at any such adjourned meeting, such adjourned meeting may be further adjourned for a period of not less than ten (10) days as determined by the chairman of the meeting prior to the adjournment of such adjourned meeting.  Notice of the reconvening of any adjourned meeting shall be given as provided in Section 9.2 hereof, except that such notice need be given only once not less than five (5) days prior to the date on which the meeting is scheduled to be reconvened.  Notice of the reconvening of an adjourned meeting shall state expressly the percentage, as provided above, of the principal amount of the outstanding Notes which shall constitute a quorum.

 

Except as limited by Section 9.2 of the Base Indenture, any resolution presented to a meeting or adjourned meeting duly reconvened at which a quorum is present as aforesaid may be adopted only by the affirmative vote of the Holders of a majority in principal amount of the outstanding Notes; provided, however, that, except as limited by Section 9.2 of the Base Indenture, any resolution with respect to any request, demand, authorization, direction, notice, consent, waiver or other action which the Indenture expressly provides may be made, given or taken by the Holders of a specified percentage, which is less than a majority, in principal amount of the outstanding Notes may be adopted at a meeting or an adjourned meeting duly reconvened and at which a quorum is present as aforesaid by the affirmative vote of the Holders of such specified percentage in principal amount of the outstanding Notes.

 

Any resolution passed or decision taken at any meeting of Holders duly held in accordance with this Section 9.4 shall be binding on all the Holders, whether or not such Holders were present or represented at the meeting.

 

Section 9.5.     Determination of Voting Rights; Conduct and Adjournment of Meetings.

 

(a)        Notwithstanding any other provisions of the Indenture, the Trustee may make such reasonable regulations as it may deem advisable for any meeting of Holders in regard to proof of the holding of Notes and of the appointment of proxies and in regard to the appointment and duties of inspectors of votes, the submission and examination of proxies,

 

- 27 -

 

certificates and other evidence of the right to vote, and such other matters concerning the conduct of the meeting as it shall deem appropriate.

 

(b)        The Trustee shall, by an instrument in writing, appoint a temporary chairman of the meeting, unless the meeting shall have been called by the Company or by Holders as provided in Section 9.2(b) hereof, in which case the Company, the Guarantor or the Holders calling the meeting, as the case may be, shall in like manner appoint a temporary chairman.  A permanent chairman and a permanent secretary of the meeting shall be elected by vote of the persons entitled to vote a majority in principal amount of the outstanding Notes of such series represented at the meeting.

 

(c)        At any meeting, each Holder or proxy shall be entitled to one (1) vote for each $1,000 principal amount of Notes held or represented by him; provided, however, that no vote shall be cast or counted at any meeting in respect of any Note challenged as not outstanding and ruled by the chairman of the meeting to be not outstanding.  The chairman of the meeting shall have no right to vote, except as a Holder or proxy.

 

(d)       Any meeting of Holders duly called pursuant to Section 9.2 hereof at which a quorum is present may be adjourned from time to time by persons entitled to vote a majority in principal amount of the outstanding Notes represented at the meeting; and the meeting may be held as so adjourned without further notice.

 

Section 9.6.     Counting Votes and Recording Action of Meetings.  The vote upon any resolution submitted to any meeting of Holders shall be by written ballots on which shall be subscribed the signatures of the Holders or of their representatives by proxy and the principal amounts and serial numbers of the outstanding Notes held or represented by them.  The permanent chairman of the meeting shall appoint two (2) inspectors of votes who shall count all votes cast at the meeting for or against any resolution and who shall make and file with the secretary of the meeting their verified written reports in triplicate of all votes cast at the meeting.  A record, at least in triplicate, of the proceedings of each meeting of Holders shall be prepared by the secretary of the meeting and there shall be attached to said record the original reports of the inspectors of votes on any vote by ballot taken thereat and affidavits by one or more persons having knowledge of the facts setting forth a copy of the notice of the meeting and showing that said notice was given as provided in Section 9.2 hereof and, if applicable, Section 9.4 hereof.  Each copy shall be signed and verified by the affidavits of the permanent chairman and secretary of the meeting and one (1) such copy shall be delivered to the Company and the Guarantor, and another to the Trustee to be preserved by the Trustee, the latter to have attached thereto the ballots voted at the meeting.  Any record so signed and verified shall be conclusive evidence of the matters therein stated.

 

ARTICLE X

 

MISCELLANEOUS PROVISIONS

 

Section 10.1.   Ratification of Indenture.  Except as expressly modified or amended hereby, the Indenture continues in full force and effect and is in all respects confirmed and preserved.

 

- 28 -

 

Section 10.2.   Governing Law.  This Second Supplemental Indenture shall be governed by and construed in accordance with the laws of the State of New York.  This Second Supplemental Indenture is subject to the provisions of the Trust Indenture Act and shall, to the extent applicable, be governed by such provisions.

 

Section 10.3.   Counterparts.  This Second Supplemental Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.  Delivery of executed signature pages by facsimile, email in PDF format or other electronic means shall be effective as delivery of manual signature pages.

 

Section 10.4.   Notices to Holders.  Except as otherwise provided in the Indenture, notices to Holders of the Notes will be given by mail to the addresses of Holders of the Notes as they appear in the Note register; provided that notices given to Holders holding Notes in book-entry form may be given electronically through the facilities of the Depository or any successor depository.

 

Section 10.5.   Successors and Assigns.  This Second Supplemental Indenture shall be binding upon the Company and each Guarantor, and their respective successors and assigns and inure to the benefit of the respective successors and assigns of the Trustee and the Holders.

 

Section 10.6.   Time of the Essence.  Time is of the essence with regard to the Company’s and the Guarantors’ performance of their respective obligations hereunder.

 

Section 10.7.   Rights of Holders Limited.  Notwithstanding anything herein to the contrary, the rights of Holders with respect to this Second Supplemental Indenture and the Guarantee shall be limited in the manner and to the extent the rights of Holders are limited under the Indenture with respect to the Indenture and the Securities.

 

Section 10.8.   Rights and Duties of Trustee.  The rights and duties of the Trustee shall be determined by the express provisions of the Base Indenture and, except as expressly set forth in this Second Supplemental Indenture, nothing in this Second Supplemental Indenture shall in any way modify or otherwise affect the Trustee’s rights and duties thereunder.  The Trustee makes no representation or warranty, express or implied, as to the validity of this Second Supplemental Indenture and, except insofar as relates to the validity hereof with respect to the Trustee specifically, the Trustee shall not be liable in connection therewith.  The Trustee makes no representation or warranty, express or implied, as to the accuracy or completeness of any information contained in any offering or disclosure document related to the sale of the Notes, except for such information that specifically pertains to the Trustee itself, or any information incorporated therein by reference as it relates specifically to the Trustee.  If and when the Trustee shall be or become a creditor of the Company (or any other obligor upon the Notes), excluding any creditor relationship listed in Trust Indenture Act Section 311(b), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company (or any such other obligor).  If the Trustee has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and the Indenture.

 

- 29 -

 

Section 10.9.   Notices.  Any notice or communication by the Company, the Guarantor or the Trustee made pursuant to the provisions of the Indenture or the Notes shall be in writing and delivered in person, delivered by commercial courier service or mailed by first-class mail, postage prepaid, addressed as follows:

 

if to the Company or the Guarantor:

 

Alexandria Real Estate Equities, Inc.
 385 Colorado Boulevard, Suite 299 
 Pasedena, California 91101 
 Attention:  General Counsel 
 Telephone:  (626) 578-0777 
 Facsimile:  (626) 578-0770

 

if to the Trustee:

 

Wilmington Trust, National Association
 50 South Sixth Street, Suite 1290

Minneapolis, Minnesota 55402

Attention:  Alexandria Real Estate Equities Administrator
 Telephone:  (612) 217-5644 
 Facsimile:  (612) 217-5651

 

Any notice or communication by the Company, the Guarantor or the Trustee to the Company or the Guarantor, or by a Holder of the Notes to the Company or the Guarantor, shall be deemed given or made as of the date delivered if delivered in the manner provided above.  Notwithstanding any other provision herein, any notice or communication to the Trustee shall only be deemed delivered upon receipt.

 

The Company, the Guarantor or the Trustee by written notice to the other may designate additional or different addresses for subsequent notices or communications.

 

Any notice or communication to a Holder of the Notes shall be delivered to his address shown on the register kept by the Security Registrar.  Failure to mail a notice or communication to a Holder of the Notes or any defect in it shall not affect its sufficiency with respect to other Holders of the Notes or any other series of Securities.

 

If a notice or communication is delivered in the manner provided above, within the time prescribed, it is duly given, whether or not the Holder receives it.  If a notice or communication is delivered in person, by courier, telexed or by facsimile transmission (with confirmation of receipt) within the time prescribed, it is duly given.

 

If the Company or the Guarantor mails a notice or communication to Holders, it shall mail a copy to the Trustee at the same time.

 

Section 10.10. Headings, etc.  The headings of the Articles and Sections of this Second Supplemental Indenture have been inserted for convenience of reference only, are not to be

 

- 30 -

 

considered a part hereof, and shall in no way modify or restrict any of the terms or provisions hereof.

 

Section 10.11. Conflicts.  In the event of any conflict between the terms of this Second Supplemental Indenture and the terms of the Indenture, the terms of this Second Supplemental Indenture shall control.

 

Section 10.12. Trust Indenture Act Controls.  If any provision of this Second Supplemental Indenture limits, qualifies, or conflicts with another provision which is required or deemed to be included in this Second Supplemental Indenture by the Trust Indenture Act, such required or deemed provision shall control.

 

- 31 -

 

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

 

	
 
    	
ALEXANDRIA REAL   ESTATE EQUITIES, INC.,

Issuer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Dean A. Shigenaga
    
	
 
    	
 
    	
Name:  Dean A. Shigenaga
    
	
 
    	
 
    	
Title:  Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
ALEXANDRIA REAL   ESTATE EQUITIES, L.P.,

Guarantor
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
ARE-QRS Corp.,
    
	
 
    	
 
    	
its General Partner
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Dean A. Shigenaga
    
	
 
    	
 
    	
Name:  Dean A. Shigenaga
    
	
 
    	
 
    	
Title:  Chief Financial Officer
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
WILMINGTON   TRUST, NATIONAL ASSOCIATION,
    
	
 
    	
as Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Hallie E. Field
    
	
 
    	
 
    	
Name: Hallie E.   Field
    
	
 
    	
 
    	
Title:  Assistant Vice President
    

 

 

 

 

 

 

[Signature Page to Second Supplemental Indenture]

 

 

EXHIBIT A

 

THIS GLOBAL NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE BASE INDENTURE GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (1) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO SECTION 3.12 OF THE SECOND SUPPLEMENTAL INDENTURE, (2) THIS GLOBAL NOTE MAY BE EXCHANGED IN WHOLE OR IN PART PURSUANT TO SECTION 3.12 OF THE SECOND SUPPLEMENTAL INDENTURE, (3) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION 3.9 OF THE BASE INDENTURE AND (4) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY.

 

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR NOTES IN DEFINITIVE FORM, THIS NOTE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY OR BY THE DEPOSITORY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITORY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITORY.  UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”), TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

 

A-1

 

ALEXANDRIA REAL ESTATE EQUITIES, INC. 
  3.95% SENIOR NOTES DUE 2027

 

No. 0001

 

CUSIP No.:  015271 AJ8

 

ISIN:  US015271AJ82

 

$350,000,000

 

Alexandria Real Estate Equities, Inc., a Maryland corporation (herein called the “Company,” which term includes any successor entity under the Indenture referred to on the reverse hereof), for value received hereby promises to pay to Cede & Co., or its registered assigns, the principal sum of THREE HUNDRED FIFTY MILLION DOLLARS ($350,000,000), or such lesser amount as is set forth in the Schedule of Exchanges of Interests in the Global Note on the other side of this Note, on January 15, 2027 at the office or agency of the Company maintained for that purpose in accordance with the terms of the Indenture, in such coin or currency of the United States of America as at the time of payment shall be legal tender for the payment of public and private debts, and to pay interest, semi-annually on January 15 and July 15 of each year, commencing January 15, 2017, on said principal sum at said office or agency, in like coin or currency, at the rate per annum of 3.95%, from the January 15 or July 15, as the case may be, next preceding the date of this Note to which interest has been paid or duly provided for, unless no interest has been paid or duly provided for on the Notes, in which case from June 10, 2016 until payment of said principal sum has been made or duly provided for.  The Company shall pay interest to Holders of record of the Notes on the January 1 or July 1 preceding the applicable January 15 or July 15 interest payment date, respectively, in accordance with the terms of the Indenture.  The Company shall pay interest on any Notes in certificated form by check mailed to the address of the person entitled thereto as it appears in the register; provided, however, that a Holder of any Notes in certificated form in the aggregate principal amount of more than $2.0 million may specify by written notice to the Company that it pay interest by wire transfer of immediately available funds to the account specified by the Holder in such notice, or on any Global Note by wire transfer of immediately available funds to the account of the Depository or its nominee.

 

The Company promises to pay interest on overdue principal, premium, if any, and (to the extent that payment of such interest is enforceable under applicable law) interest at the rate of 1% per annum above the rate borne by the Notes.

 

Reference is made to the further provisions of this Note set forth on the reverse hereof and the Indenture governing this Note.  Such further provisions shall for all purposes have the same effect as though fully set forth at this place.

 

This Note shall not be valid or become obligatory for any purpose until the certificate of authentication hereon shall have been signed manually by the Trustee or a duly authorized authenticating agent under the Indenture.

 

A-2

 

IN WITNESS WHEREOF, the Company has caused this Note to be duly executed.

 

Dated: _______, 2016

 

 

	
 
    	
ALEXANDRIA REAL   ESTATE EQUITIES, INC.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:  Dean A. Shigenaga
    
	
 
    	
 
    	
Title:  Chief Financial Officer
    

 

A-3

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

 

 

This is one of the Notes described in the within-named Indenture.

 

Dated: _______, 2016

 

 

	
 
    	
Wilmington   Trust, National Association, as Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Authorized   Signatory
    

 

A-4

 

[FORM OF REVERSE SIDE OF NOTE]

 

ALEXANDRIA REAL ESTATE EQUITIES, INC. 
  3.95% SENIOR NOTES DUE 2027

 

This Note is one of a duly authorized issue of Securities of the Company, designated as its 3.95% Senior Notes due 2027 (herein called the “Notes”), issued under and pursuant to an Indenture dated as of November 17, 2015 (herein called the “Base Indenture”), among the Company, the Guarantor and Wilmington Trust, National Association, as trustee (herein called the “Trustee”), as supplemented by the Supplemental Indenture No. 2, dated as of June 10, 2016 (herein called the “Second Supplemental Indenture,” and together with the Base Indenture, the “Indenture”), to which Indenture and any indentures supplemental thereto reference is hereby made for a description of the rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the Company, the Guarantor and the Holders of the Notes.  Capitalized terms used but not otherwise defined in this Note shall have the respective meanings ascribed thereto in the Indenture.  In the event of any conflict between the terms of this Note and the terms of the Indenture, the terms of the Indenture control.

 

If an Event of Default (other than an Event of Default specified in Sections 7.1(f), 7.1(g) and 7.1(h) of the Second Supplemental Indenture) occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest on all Notes may be declared to be due and payable by either the Trustee or the Holders of at least 25%  in aggregate principal amount of the Notes then outstanding, and, upon said declaration the same shall be immediately due and payable.  If an Event of Default specified in Sections 7.1(f), 7.1(g) and 7.1(h) of the Second Supplemental Indenture occurs, the principal of and premium, if any, and interest accrued and unpaid on all the Notes shall be immediately and automatically due and payable without necessity of further action.

 

The Indenture contains provisions permitting the Company and the Trustee, with the consent of the Holders of not less than a majority in aggregate principal amount of the Notes at the time outstanding, to execute supplemental indentures adding any provisions to or changing in any manner or eliminating any of the provisions of the Indenture or of any supplemental indenture or modifying in any manner the rights of the Holders of the Notes, subject to exceptions set forth in Section 9.2 of the Base Indenture.  Subject to the provisions of the Indenture, the Holders of not less than a majority in aggregate principal amount of the Notes at the time outstanding may, on behalf of the Holders of all of the Notes, waive any past Default or Event of Default, subject to exceptions set forth in the Indenture.

 

No reference herein to the Indenture and no provision of this Note or of the Indenture shall impair, as among the Company and the Holder of the Notes, the obligation of the Company, which is absolute and unconditional, to pay the principal of, premium, if any, on and interest on this Note at the place, at the respective times, at the rate and in the coin or currency prescribed herein and in the Indenture.

 

Interest on the Notes shall be computed on the basis of a 360-day year of twelve 30-day months.

 

A-5

 

The Notes are issuable in fully registered book-entry form, without coupons, in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.  At the office or agency of the Company referred to on the face hereof, and in the manner and subject to the limitations provided in the Indenture, without payment of any service charge but with payment of a sum sufficient to cover any tax, assessment or other governmental charge that may be imposed in connection with any registration or exchange of Notes, Notes may be exchanged for a like aggregate principal amount of Notes of any other authorized denominations.

 

The Company shall have the right to redeem the Notes under certain circumstances as set forth in Article IV of the Second Supplemental Indenture.

 

The Notes are not subject to redemption through the operation of any sinking fund.

 

Except as expressly provided in Article V of the Second Supplemental Indenture, no recourse for the payment of the principal of or any premium or interest on this Note, or for any claim based hereon or otherwise in respect hereof, and no recourse under or upon any obligation, covenant or agreement of the Company in the Indenture or any supplemental indenture or in any Note, or because of the creation of any indebtedness represented thereby, shall be had against any incorporator, stockholder, limited partner, member, manager, employee, agent, officer, director or subsidiary, as such, past, present or future, of the Guarantor, the Company or any of the Company’s Subsidiaries or of any successor thereto, either directly or through the Guarantor, the Company or any of the Company’s Subsidiaries or of any successor thereto, whether by virtue of any constitution, statute or rule of law, or by the enforcement of any assessment or penalty or otherwise; it being expressly understood that all such liability is hereby expressly waived and released as a condition of, and as consideration for, the execution of the Indenture and the issue of this Note.

 

A-6

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

	
(I) or (we) assign and transfer this Note to:
    	
 
    
	
 
    	
(Insert assignee’s legal name)
    
	
 
    	
 
    
	
 
    
	
(Insert assignee’s soc. sec. or tax I.D. no.)
    
	
 
    	
 
    
	
 
    
	
(Print or type assignee’s name, address and zip   code)
    

 

	
and
    	
 
    
	
irrevocably
    	
 
    
	
appoint
    	
 
    
	
to transfer this Note on   the books of the Company.  The agent   may substitute another to act for him.
    

 

Date:

 

 

	
 
    	
Your 
    
	
 
    	
Signature:
    	
 
    
	
 
    	
(Sign exactly as your   name appears on the face of this Note)
    
	
 
    	
 
    	
 
    
	
Signature Guarantee*:
    	
 
    	
 
    

 

 

 

 

____________

*                  Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor acceptable to the Trustee).

 

A-7

 

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE

 

The following exchanges of a part of this Global Note for an interest in another Global Note or for a Definitive Note, or exchanges of a part of another Global Note or Definitive Note for an interest in this Global Note, have been made:

 

	
Date of Exchange
    	
 
    	
Amount of decrease in
   principal amount at
   maturity of this Global
   Note
    	
 
    	
Amount of increase in
   principal amount at
   maturity of this Global
   Note
    	
 
    	
Principal amount at
   maturity of this Global
   Note following such
   decrease (or increase)
    	
 
    	
Signature of authorized
   officer of Trustee or
   Custodian
    

 

A-8

 

EXHIBIT B

 

NOTATION OF GUARANTEE

 

The Guarantor listed below (hereinafter referred to as the “Guarantor,” which term includes any successors or assigns under the Indenture, dated the date hereof, among the Guarantor, the Company and Wilmington Trust, National Association, as trustee (the “Base Indenture”), as supplemented by the Supplemental Indenture No. 2, dated the date hereof (the “Second Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), has fully, unconditionally and absolutely guaranteed on a senior basis the Guarantee Obligations (as defined in Section 5.1 of the Second Supplemental Indenture), which include (i) the due and punctual payment of the principal of, premium, if any, and interest, if any, on the 3.95% Senior Notes due 2027 (the “Notes”) to which this notation is affixed, whether at maturity, by acceleration, call for redemption or otherwise, the due and punctual payment of interest on the overdue principal and premium, if any, and (to the extent permitted by law) interest on any interest on the Notes, and the due and punctual performance of all other obligations of the Company, to the Holders of the Notes or the Trustee all in accordance with the terms set forth in Article V of the Second Supplemental Indenture, and (ii) in case of any extension of time of payment or renewal of any Notes or any such other obligations, that the same shall be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at maturity, by acceleration, call for redemption or otherwise.

 

The obligations of such Guarantor to the Holders of Notes to which this notation is affixed and to the Trustee pursuant to the Guarantee and the Indenture are expressly set forth in Article V of the Second Supplemental Indenture and reference is hereby made to the Indenture for the precise terms of the Guarantee.

 

No past, present or future director, officer, limited partner, employee, incorporator or stockholder (direct or indirect) of the Guarantor (or any such successor entity), as such, shall have any liability for any obligations of the Guarantor under this Guarantee or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.

 

The Guarantor hereby waives diligence, presentment, demand of payment, filing of claims with a court in the event of merger or bankruptcy of the Company, any right to require a proceeding first against the Company, the benefit of discussion, protest or notice with respect to the Notes and all demands whatsoever.

 

This is a continuing Guarantee and shall remain in full force and effect and shall be binding upon the Guarantor and its successors and assigns until full and final payment of all of the Company’s obligations under the Notes and Indenture or until legally discharged in accordance with the Indenture and shall inure to the benefit of the successors and assigns of the Trustee and the Holders of the Notes, and, in the event of any transfer or assignment of rights by any Holder of the Notes or the Trustee, the rights and privileges herein conferred upon that party shall automatically extend to and be vested in such transferee or assignee, all subject to the terms and conditions hereof.  This is a Guarantee of payment and performance and not of collectability.

 

B-1

 

This Guarantee shall not be valid or obligatory for any purpose until the certificate of authentication on the Note upon which this Guarantee is noted shall have been executed by the Trustee under the Indenture by the manual signature of one of its authorized officers.

 

The obligations of the Guarantor under this Guarantee shall be limited to the extent necessary to insure that it does not constitute a fraudulent conveyance under applicable law.  This Guarantee shall be governed by and construed in accordance with the laws of the State of New York.

 

THE TERMS OF ARTICLE V OF THE SECOND SUPPLEMENTAL INDENTURE ARE INCORPORATED HEREIN BY REFERENCE.

 

Capitalized terms used herein have the same meanings given in the Indenture unless otherwise indicated.

 

	
 
    	
ALEXANDRIA REAL   ESTATE EQUITIES, L.P.
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:   ARE-QRS Corp., its general partner
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Dated: _______, 2016
    	
By:
    	
 
    
	
 
    	
 
    	
Name:  Dean A. Shigenaga
    
	
 
    	
 
    	
Title:  Chief Financial Officer
    

 

B-2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00259-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00259-of-00352.parquet"}]]