Document:

Exhibit 4.1

 

EXECUTION VERSION

 

 

LADDER CAPITAL FINANCE HOLDINGS LLLP

 

AND

 

LADDER CAPITAL FINANCE CORPORATION

 

as Issuers,

 

AND

 

THE GUARANTORS PARTY HERETO

 

AND

 

WILMINGTON TRUST, NATIONAL ASSOCIATION,

 

as Trustee

 

$400,000,000 5.250% Senior Notes due 2025

 

 

INDENTURE

 

Dated as of September 25, 2017

 

 

 

TABLE OF CONTENTS

 

	
 
    	
 
    	
Page
    
	
 
    	
 
    	
 
    
	
Article I
    
	
 
    	
 
    	
 
    
	
DEFINITIONS AND   INCORPORATION BY REFERENCE
    
	
 
    	
 
    	
 
    
	
Section 1.1
    	
Definitions
    	
1
    
	
Section 1.2
    	
Other Definitions
    	
22
    
	
Section 1.3
    	
Inapplicability of   Trust Indenture Act
    	
23
    
	
Section 1.4
    	
Rules of   Construction
    	
23
    
	
 
    	
 
    	
 
    
	
Article II
    
	
 
    
	
THE NOTES
    
	
 
    	
 
    	
 
    
	
Section 2.1
    	
Form, Dating and Terms
    	
24
    
	
Section 2.2
    	
Execution and   Authentication
    	
31
    
	
Section 2.3
    	
Registrar and Paying   Agent
    	
32
    
	
Section 2.4
    	
Paying Agent to Hold   Money in Trust
    	
33
    
	
Section 2.5
    	
Holder Lists
    	
33
    
	
Section 2.6
    	
Transfer and Exchange
    	
33
    
	
Section 2.7
    	
[Reserved]
    	
37
    
	
Section 2.8
    	
Form of   Certificate to be Delivered in Connection with Transfers to IAIs
    	
37
    
	
Section 2.9
    	
Form of   Certificate to be Delivered in Connection with Transfers Pursuant to   Regulation S
    	
39
    
	
Section 2.10
    	
Form of   Certificate to be Delivered in Connection with Transfers to AIs
    	
40
    
	
Section 2.11
    	
Mutilated, Destroyed,   Lost or Stolen Notes
    	
42
    
	
Section 2.12
    	
Outstanding Notes
    	
43
    
	
Section 2.13
    	
Temporary Notes
    	
43
    
	
Section 2.14
    	
Cancellation
    	
44
    
	
Section 2.15
    	
Payment of Interest;   Defaulted Interest
    	
44
    
	
Section 2.16
    	
CUSIP and ISIN Numbers
    	
45
    
	
Section 2.17
    	
Joint and Several Liability
    	
45
    
	
 
    	
 
    	
 
    
	
Article III
    
	
 
    
	
COVENANTS
    
	
 
    	
 
    	
 
    
	
Section 3.1
    	
Payment of Notes
    	
46
    
	
Section 3.2
    	
Limitation on   Indebtedness
    	
46
    
	
Section 3.3
    	
Maintenance of Total   Unencumbered Assets
    	
50
    
	
Section 3.4
    	
Limitation on   Guarantees
    	
50
    
	
Section 3.5
    	
Change of Control
    	
52
    
	
Section 3.6
    	
Reports
    	
55
    

 

 

	
Section 3.7
    	
Maintenance of Office   or Agency
    	
57
    
	
Section 3.8
    	
[Reserved]
    	
57
    
	
Section 3.9
    	
[Reserved]
    	
57
    
	
Section 3.10
    	
[Reserved]
    	
57
    
	
Section 3.11
    	
Compliance Certificate
    	
57
    
	
Section 3.12
    	
Further Instruments and   Acts
    	
57
    
	
Section 3.13
    	
Statement by Officers   as to Default
    	
58
    
	
Section 3.14
    	
Suspension of Certain   Covenants
    	
58
    
	
Section 3.15
    	
Designation of   Restricted and Unrestricted Subsidiaries
    	
59
    
	
 
    	
 
    	
 
    
	
Article IV
    
	
 
    
	
SUCCESSOR   ISSUERS; SUCCESSOR PERSON
    
	
 
    	
 
    	
 
    
	
Section 4.1
    	
Merger and   Consolidation
    	
59
    
	
 
    	
 
    	
 
    
	
Article V
    
	
 
    
	
REDEMPTION OF   SECURITIES
    
	
 
    	
 
    	
 
    
	
Section 5.1
    	
Notices to Trustee
    	
61
    
	
Section 5.2
    	
Selection of Notes to   Be Redeemed or Purchased
    	
61
    
	
Section 5.3
    	
Notice of Redemption
    	
61
    
	
Section 5.4
    	
Effect of Notice of   Redemption
    	
62
    
	
Section 5.5
    	
Deposit of Redemption   or Purchase Price
    	
63
    
	
Section 5.6
    	
Notes Redeemed or   Purchased in Part
    	
63
    
	
Section 5.7
    	
Optional Redemption
    	
63
    
	
Section 5.8
    	
Mandatory Redemption
    	
64
    
	
 
    	
 
    	
 
    
	
Article VI
    
	
 
    
	
DEFAULTS AND   REMEDIES
    
	
 
    	
 
    	
 
    
	
Section 6.1
    	
Events of Default
    	
64
    
	
Section 6.2
    	
Acceleration
    	
67
    
	
Section 6.3
    	
Other Remedies
    	
67
    
	
Section 6.4
    	
Waiver of Past Defaults
    	
68
    
	
Section 6.5
    	
Control by Majority
    	
68
    
	
Section 6.6
    	
Limitation on Suits
    	
68
    
	
Section 6.7
    	
[Reserved]
    	
69
    
	
Section 6.8
    	
Collection Suit by   Trustee
    	
69
    
	
Section 6.9
    	
Trustee May File   Proofs of Claim
    	
69
    
	
Section 6.10
    	
Priorities
    	
70
    
	
Section 6.11
    	
Undertaking for Costs
    	
70
    

 

ii

 

	
Article VII
    
	
 
    
	
TRUSTEE
    
	
 
    	
 
    	
 
    
	
Section 7.1
    	
Duties of Trustee
    	
70
    
	
Section 7.2
    	
Rights of Trustee.   Subject to Section 7.1:
    	
71
    
	
Section 7.3
    	
Individual Rights of   Trustee
    	
73
    
	
Section 7.4
    	
Trustee’s Disclaimer
    	
73
    
	
Section 7.5
    	
Notice of Defaults
    	
74
    
	
Section 7.6
    	
[Reserved]
    	
74
    
	
Section 7.7
    	
Compensation and   Indemnity
    	
74
    
	
Section 7.8
    	
Replacement of Trustee
    	
75
    
	
Section 7.9
    	
Successor Trustee by   Merger
    	
76
    
	
Section 7.10
    	
Eligibility;   Disqualification
    	
76
    
	
Section 7.11
    	
[Reserved]
    	
76
    
	
Section 7.12
    	
Trustee’s Application   for Instruction from the Issuers
    	
76
    
	
 
    	
 
    	
 
    
	
Article VIII
    
	
 
    
	
LEGAL DEFEASANCE   AND COVENANT DEFEASANCE
    
	
 
    	
 
    	
 
    
	
Section 8.1
    	
Option to Effect Legal   Defeasance or Covenant Defeasance; Defeasance
    	
76
    
	
Section 8.2
    	
Legal Defeasance and   Discharge
    	
77
    
	
Section 8.3
    	
Covenant Defeasance
    	
77
    
	
Section 8.4
    	
Conditions to Legal or   Covenant Defeasance
    	
78
    
	
Section 8.5
    	
Deposited Money and U.S.
    	
79
    
	
Section 8.6
    	
Repayment to the   Issuers
    	
80
    
	
Section 8.7
    	
Reinstatement
    	
80
    
	
 
    	
 
    	
 
    
	
Article IX
    
	
 
    
	
AMENDMENTS
    
	
 
    	
 
    	
 
    
	
Section 9.1
    	
Without Consent of   Holders
    	
80
    
	
Section 9.2
    	
With Consent of Holders
    	
81
    
	
Section 9.3
    	
[Reserved]
    	
83
    
	
Section 9.4
    	
Revocation and Effect   of Consents and Waivers
    	
83
    
	
Section 9.5
    	
Notation on or Exchange   of Notes
    	
83
    
	
Section 9.6
    	
Trustee to Sign   Amendments
    	
83
    
	
 
    	
 
    	
 
    
	
Article X
    
	
 
    
	
GUARANTEE
    
	
 
    	
 
    	
 
    
	
Section 10.1
    	
Guarantee
    	
84
    
	
Section 10.2
    	
Limitation on Liability;   Termination, Release and Discharge
    	
86
    
	
Section 10.3
    	
Right of Contribution
    	
86
    

 

iii

 

	
Section 10.4
    	
No Subrogation
    	
87
    
	
 
    	
 
    	
 
    
	
Article XI
    
	
 
    
	
SATISFACTION AND   DISCHARGE
    
	
Section 11.1
    	
Satisfaction and   Discharge
    	
87
    
	
Section 11.2
    	
Application of Trust   Money
    	
88
    
	
 
    	
 
    	
 
    
	
Article XII
    
	
 
    
	
MISCELLANEOUS
    
	
 
    	
 
    	
 
    
	
Section 12.1
    	
[Reserved]
    	
89
    
	
Section 12.2
    	
Notices
    	
89
    
	
Section 12.3
    	
[Reserved]
    	
90
    
	
Section 12.4
    	
Certificate and Opinion   as to Conditions Precedent
    	
90
    
	
Section 12.5
    	
Statements Required in   Certificate or Opinion
    	
90
    
	
Section 12.6
    	
When Notes Disregarded
    	
91
    
	
Section 12.7
    	
Rules by Trustee,   Paying Agent and Registrar
    	
91
    
	
Section 12.8
    	
Legal Holidays
    	
91
    
	
Section 12.9
    	
Governing Law
    	
91
    
	
Section 12.10
    	
Jurisdiction
    	
91
    
	
Section 12.11
    	
Waivers of Jury Trial
    	
91
    
	
Section 12.12
    	
USA PATRIOT Act
    	
92
    
	
Section 12.13
    	
No Recourse Against   Others
    	
92
    
	
Section 12.14
    	
Successors
    	
92
    
	
Section 12.15
    	
Multiple Originals
    	
92
    
	
Section 12.16
    	
[Reserved]
    	
92
    
	
Section 12.17
    	
Table of Contents;   Headings
    	
92
    
	
Section 12.18
    	
Force Majeure
    	
92
    
	
Section 12.19
    	
Severability
    	
93
    
	
Section 12.20
    	
[Reserved]
    	
93
    
	
Section 12.21
    	
[Reserved]
    	
93
    
	
Section 12.22
    	
Waiver of Immunities
    	
93
    
	
Section 12.23
    	
Judgment Currency
    	
93
    

 

	
EXHIBIT A
    	
Form of Global   Restricted Note
    	
 
    
	
EXHIBIT B
    	
Form of   Supplemental Indenture
    	
 
    

 

iv

 

INDENTURE dated as of September 25, 2017, among LADDER CAPITAL FINANCE HOLDINGS LLLP, a Delaware limited liability limited partnership (the “Company”), and LADDER CAPITAL FINANCE CORPORATION, a Delaware corporation (the “Co-Issuer” and, together with the Company, the “Issuers”), the guarantors from time to time parties hereto, and WILMINGTON TRUST, NATIONAL ASSOCIATION, a national banking association, as trustee (in such capacity, the “Trustee”).

 

W I T N E S S E T H:

 

WHEREAS, the Issuers have duly authorized the execution and delivery of this Indenture to provide for the issuance of (i) their $400,000,000 5.250% Senior Notes due 2025 (the “Initial Notes”), as issued on the date hereof, and (ii) any additional Notes (the “Additional Notes,” and together with the Initial Notes, the “Notes”) that may be issued after the Issue Date;

 

WHEREAS, the Issuers have duly authorized the execution and delivery of this Indenture; and

 

WHEREAS, all things necessary (i) to make the Notes, when executed and duly issued by the Issuers and authenticated and delivered hereunder, the valid obligations of the Issuers, and (ii) to make this Indenture a valid agreement of the Issuers have been done.

 

NOW, THEREFORE, in consideration of the premises and the purchase of the Notes by the Holders thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders, as follows:

 

ARTICLE I

 

DEFINITIONS AND INCORPORATION BY REFERENCE

 

Section 1.1            Definitions.

 

“Acquired Indebtedness” means Indebtedness (1) of a Person or any of its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary, or (2) assumed in connection with the acquisition of assets from such Person, in each case whether or not Incurred by such Person in connection with such Person becoming a Restricted Subsidiary of the Company or such acquisition or (3) of a Person at the time such Person merges with or into or consolidates or otherwise combines with the Company or any Restricted Subsidiary. Acquired Indebtedness shall be deemed to have been Incurred, with respect to clause (1) of the preceding sentence, on the date such Person becomes a Restricted Subsidiary and, with respect to clause (2) of the preceding sentence, on the date of consummation of such acquisition of assets and, with respect to clause (3) of the preceding sentence, on the date of the relevant merger, consolidation or other combination.

 

“Affiliate” of any specified Person means any other Person, directly or indirectly, controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any Person means the power to direct the management and policies of such Person, directly or indirectly,

 

 

whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

 

“AI” means an “accredited investor” as described in Rule 501(a)(4) under the Securities Act.

 

“Applicable Premium” means the greater of (A) 1.0% of the principal amount of such Note and (B) on any redemption date, the excess (to the extent positive) of:

 

(a)           the present value at such redemption date of (i) the redemption price of such Note at October 1, 2020 (such redemption price (expressed in percentage of principal amount) as set forth in Section 5.7(b) (excluding accrued but unpaid interest)), plus (ii) all required interest payments due on such Note to and including such date set forth in clause (i) (excluding accrued but unpaid interest), computed upon the redemption date using a discount rate equal to the Treasury Rate at such redemption date plus 50 basis points; over

 

(b)           the outstanding principal amount of such Note;

 

in each case, as calculated by the Company or on behalf of the Company by such Person as the Company shall designate.

 

“Associate” means (i) any Person engaged in a Similar Business of which the Company or its Restricted Subsidiaries are the legal and beneficial owners of between 20% and 50% of all outstanding Voting Stock and (ii) any Joint Venture entered into by the Company or any Restricted Subsidiary of the Company.

 

“Bankruptcy Law” means Title 11 of the United States Code or similar federal, state or foreign law for the relief of debtors.

 

“Board of Directors” means (1) with respect to any corporation, the board of directors or managers, as applicable, of the corporation, or any duly authorized committee thereof; (2) with respect to any partnership, the board of directors or other governing body of the general partner of the partnership or any duly authorized committee thereof; (3) with respect to a limited liability company, the managing member or members or any duly authorized controlling committee thereof; and (4) with respect to any other Person, the board or any duly authorized committee of such Person serving a similar function. Whenever any provision requires any action or determination to be made by, or any approval of, a Board of Directors, such action, determination or approval shall be deemed to have been taken or made if approved by a majority of the directors on any such Board of Directors (whether or not such action or approval is taken as part of a formal board meeting or as a formal board approval).

 

“Business Day” means each day that is not a Saturday, Sunday or other day on which banking institutions in New York, New York, United States or in the jurisdiction of the place of payment are authorized or required by law to close.

 

“Capital Stock” of any Person means any and all shares of, rights to purchase, warrants, options or depositary receipts for, or other equivalents of or partnership or other interests in

 

2

 

(however designated), equity of such Person, including any Preferred Stock, but excluding any debt securities convertible into, or exchangeable for, such equity.

 

“Capitalized Lease Obligations” means an obligation that is required to be classified and accounted for as a capitalized lease for financial reporting purposes on the basis of GAAP. The amount of Indebtedness represented by such obligation will be the capitalized amount of such obligation at the time any determination thereof is to be made as determined on the basis of GAAP, and the Stated Maturity thereof will be the date of the last payment of rent or any other amount due under such lease prior to the first date such lease may be terminated without penalty.

 

“Cash Equivalents” means:

 

(a)           (1) United States dollars, euro, or any national currency of any member state of the European Union; or (2) any other foreign currency held by the Company and the Restricted Subsidiaries in the ordinary course of business;

 

(b)           securities issued or directly and fully Guaranteed or insured by the United States or Canadian governments, a member state of the European Union or, in each case, any agency or instrumentality thereof (provided that the full faith and credit of such country or such member state is pledged in support thereof), having maturities of not more than two years from the date of acquisition;

 

(c)           certificates of deposit, time deposits, Eurodollar time deposits, overnight bank deposits or bankers’ acceptances having maturities of not more than one year from the date of acquisition thereof issued by any lender or by any bank or trust company (a) whose commercial paper is rated at least “A-2” or the equivalent thereof by S&P or at least “P-2” or the equivalent thereof by Moody’s (or if at the time neither is issuing comparable ratings, then a comparable rating of another Nationally Recognized Statistical Rating Organization) or (b) (in the event that the bank or trust company does not have commercial paper which is rated) having combined capital and surplus in excess of $100.0 million;

 

(d)           repurchase obligations for underlying securities of the types described in clauses (2) and (3) entered into with any bank meeting the qualifications specified in clause (3) above;

 

(e)           commercial paper rated at the time of acquisition thereof at least “A-2” or the equivalent thereof by S&P or “P-2” or the equivalent thereof by Moody’s or carrying an equivalent rating by a Nationally Recognized Statistical Rating Organization, if both of the two named rating agencies cease publishing ratings of investments or, if no rating is available in respect of the commercial paper, the issuer of which has an equivalent rating in respect of its long-term debt, and in any case maturing within one year after the date of acquisition thereof;

 

(f)            readily marketable direct obligations issued by any state of the United States of America, any province of Canada, any member of the European Union or any political subdivision, taxing authority or public instrumentality thereof, in each case, having one of the two highest rating categories obtainable from either Moody’s or S&P (or, if at the time, neither is issuing comparable ratings, then a comparable rating of another Nationally Recognized

 

3

 

Statistical Rating Organization selected by the Issuers) with maturities of not more than two years from the date of acquisition;

 

(g)           Indebtedness or Preferred Stock issued by Persons with a rating of “BBB-” or higher from S&P or “Baa3” or higher from Moody’s (or, if at the time, neither is issuing comparable ratings, then a comparable rating of another Nationally Recognized Statistical Rating Organization selected by the Issuers) with maturities of two years or less from the date of acquisition;

 

(h)           bills of exchange issued in the United States, Canada, a member state of the European Union or Japan eligible for rediscount at the relevant central bank and accepted by a bank (or any dematerialized equivalent); and

 

(i)            interests in any investment company, money market, enhanced high yield fund or other investment fund which invests 90% or more of its assets in instruments of the types specified in clauses (a) through (h) above.

 

Notwithstanding the foregoing, Cash Equivalents shall include amounts denominated in currencies other than those set forth in clause (a) above; provided that such amounts are converted into any currency listed in clause (a) as promptly as practicable and in any event within 10 Business Days following the receipt of such amounts.

 

“Cash Management Services” means any of the following to the extent not constituting a line of credit (other than an overnight draft facility that is not in default): ACH transactions, treasury, depository, credit or debit card, purchasing card, stored value card, electronic fund transfer services and/or cash management services, including, without limitation, controlled disbursement services, overdraft facilities, foreign exchange facilities, deposit and other accounts and merchant services or other cash management arrangements in the ordinary course or consistent with past practice.

 

“Change of Control” means:

 

(a)           the Company becomes aware of (by way of a report or any other filing pursuant to Section 13(d) of the Exchange Act, proxy, vote, written notice or otherwise) any “person” or “group” of related persons (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act as in effect on the Issue Date), other than one or more Permitted Holders, is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act as in effect on the Issue Date), directly or indirectly, of more than 50% of the total voting power of the Voting Stock of the Company other than in connection with any transaction or series of transactions in which the Company shall become the wholly owned subsidiary of a Parent of which no person or group, as noted above, holds more than 50% of the total voting power (other than a Permitted Holder); or

 

(b)           the sale, lease, transfer, conveyance or other disposition (other than by way of merger, consolidation or other business combination transaction), in one or a series of related transactions, of all or substantially all of the assets of the Company and its Restricted Subsidiaries, taken as a whole, other than any Required Asset Sale, to a Person, other than the Company or any of its Restricted Subsidiaries or one or more Permitted Holders.

 

4

 

Notwithstanding the foregoing, (i) a transaction will not be deemed to involve a Change of Control if the Company becomes a direct or indirect wholly owned subsidiary of a holding company and (1) the direct or indirect holders of the Voting Stock of such holding company immediately following that transaction are substantially the same as the holders of our Voting Stock immediately prior to that transaction or (2) immediately following that transaction no “person” or “group” of related persons (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act as in effect on the Issue Date), other than a holding company satisfying the requirements of this sentence or a Permitted Holder, is the beneficial owner, directly or indirectly, of more than 50% of the Voting Stock of such holding company and (b) the right to acquire Voting Stock (so long as such Person does not have the right to direct the voting of the Voting Stock subject to such right) or any veto power in connection with the acquisition or disposition of Voting Stock will not cause a party to be a beneficial owner.

 

“Change of Control Repurchase Event” means the occurrence of both a Change of Control and a Ratings Event.

 

“Co-Issuer” means Ladder Capital Finance Corporation, a Delaware corporation, and any successor thereto.

 

“Code” means the United States Internal Revenue Code of 1986, as amended.

 

“Company” means Ladder Capital Finance Holdings LLLP, a Delaware limited liability limited partnership, and any successor thereto.

 

“Consolidated Non-Funding Debt” means, with respect to any Person as of any determination date, an amount equal to the sum of (1) the aggregate amount of all outstanding Non-Funding Indebtedness for borrowed money and obligations in respect of Capitalized Lease Obligations of such Person and its Restricted Subsidiaries on a consolidated basis, plus (2) the aggregate liquidation preference of Disqualified Stock and Preferred Stock of Restricted Subsidiaries, less (3) up to $150.0 million aggregate amount of unrestricted cash of such Person and its Restricted Subsidiaries that is in excess of $50.0 million, in each case as of such determination date.

 

“Consolidated Non-Funding Debt to Equity Ratio” means, with respect to any Person on any determination date, the ratio of Consolidated Non-Funding Debt of such Person as of such determination date to the Consolidated Shareholders Equity of such Person as of such determination date. In the event that the Company or any Restricted Subsidiary Incurs, assumes, Guarantees, redeems, defeases, retires or extinguishes any Consolidated Non-Funding Debt (other than Consolidated Non-Funding Debt incurred under any revolving credit facility unless such Indebtedness has been permanently repaid and has not been replaced) or issues or redeems Disqualified Stock or Preferred Stock subsequent to the date of the most recent consolidated balance sheet for which the Consolidated Non-Funding Debt to Equity Ratio is being calculated but prior to or simultaneously with the event for which the calculation of the Consolidated Non-Funding Debt to Equity Ratio is made (the “Consolidated Non-Funding Debt to Equity Ratio Calculation Date”), then the Consolidated Non-Funding Debt to Equity Ratio shall be calculated giving pro forma effect to such Incurrence, assumption, guarantee, redemption, defeasance, retirement or extinguishment of Indebtedness, or such Issuance or redemption of Disqualified

 

5

 

Stock or Preferred Stock as if the same had occurred prior to such determination date; provided, however, that the pro forma calculation shall not give effect to any Indebtedness Incurred on such determination date pursuant to Section 3.2(b). For purposes of making the computation referred to above, any investments, acquisitions, dispositions, mergers, consolidations and disposed operations that have been made by the Company or any of its Restricted Subsidiaries on or prior to or simultaneously with the Consolidated Non-Funding Debt to Equity Ratio Calculation Date shall be calculated on a pro forma basis assuming that all such investments, acquisitions, dispositions, mergers, consolidations and disposed or discontinued operations had occurred prior to the Consolidated Non-Funding Debt to Equity Ratio Calculation Date. For purposes of this definition, whenever pro forma effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a responsible financial or chief accounting officer of the Company.

 

“Consolidated Shareholders Equity” means, with respect to any Person as of any determination date, the total equity (capital), shareholders’ equity or partners’ capital, as applicable, as shown on the most recent consolidated balance sheet of such Person and its Restricted Subsidiaries that is internally available, determined on a pro forma basis in a manner consistent with the pro forma basis contained in the definition of Consolidated Non-Funding Debt to Equity Ratio.

 

“Contingent Obligations” means, with respect to any Person, any obligation of such Person guaranteeing in any manner, whether directly or indirectly, any operating lease, dividend or other obligation that does not constitute Indebtedness (“primary obligations”) of any other Person (the “primary obligor”), including any obligation of such Person, whether or not contingent:

 

(a)           to purchase any such primary obligation or any property constituting direct or indirect security therefor;

 

(b)           to advance or supply funds:

 

(i)            for the purchase or payment of any such primary obligation; or

 

(ii)           to maintain the working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; or

 

(c)           to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation against loss in respect thereof.

 

“Credit Enhancement Agreements” means, collectively, any documents, instruments, guarantees or agreements entered into by the Company, any of its Restricted Subsidiaries or any Securitization Entity for the purpose of providing credit support (that is reasonably customary as determined by the Company) with respect to any Permitted Funding Indebtedness or Permitted Securitization Indebtedness.

 

“Credit Facility” means, with respect to the Company or any of its Subsidiaries, one or more debt facilities, indentures or other arrangements (including commercial paper facilities and

 

6

 

overdraft facilities) with banks, other financial institutions or investors providing for revolving credit loans, term loans, notes, receivables financing (including through the sale of receivables to such institutions or to special purpose entities formed to borrow from such institutions against such receivables), letters of credit or other Indebtedness, in each case, as amended, restated, modified, renewed, refunded, replaced, restructured, refinanced, repaid, increased or extended in whole or in part from time to time (and whether in whole or in part and whether or not with the original administrative agent and lenders or another administrative agent or agents or other banks or institutions and whether provided under one or more other credit or other agreements, indentures, financing agreements or otherwise) and in each case including all agreements, instruments and documents executed and delivered pursuant to or in connection with the foregoing (including any notes and letters of credit issued pursuant thereto and any Guarantee and collateral agreement, patent and trademark security agreement, mortgages or letter of credit applications and other Guarantees, pledges, agreements, security agreements and collateral documents). Without limiting the generality of the foregoing, the term “Credit Facility” shall include any agreement or instrument (1) changing the maturity of any Indebtedness Incurred thereunder or contemplated thereby, (2) adding Subsidiaries of the Company as additional borrowers or guarantors thereunder, (3) increasing the amount of Indebtedness Incurred thereunder or available to be borrowed thereunder or (4) otherwise altering the terms and conditions thereof.

 

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

 

“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; provided that any Default that results solely from the taking of an action that would have been permitted but for the continuation of a previous Default will be deemed to be cured if such previous Default is cured prior to becoming an Event of Default.

 

“Definitive Notes” means certificated Notes.

 

“Depositary” means, with respect to the Notes issuable or issued in whole or in part in global form, the Person specified in Section 2.3 hereof as the Depositary with respect to the Notes, and any and all successors thereto appointed as depositary hereunder and having become such pursuant to the applicable provision of this Indenture.

 

“Disqualified Stock” means, with respect to any Person, any Capital Stock of such Person which by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable) or upon the happening of any event:

 

(a)           matures or is mandatorily redeemable for cash or in exchange for Indebtedness pursuant to a sinking fund obligation or otherwise; or

 

(b)           is or may become (in accordance with its terms) upon the occurrence of certain events or otherwise redeemable or repurchasable for cash or in exchange for Indebtedness at the option of the holder of the Capital Stock in whole or in part,

 

in each case on or prior to the earlier of (a) the Stated Maturity of the Notes or (b) the date on which there are no Notes outstanding; provided, however, that (i) only the portion of Capital

 

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Stock which so matures or is mandatorily redeemable, is so convertible or exchangeable or is so redeemable at the option of the holder thereof prior to such date will be deemed to be Disqualified Stock and (ii) any Capital Stock that would constitute Disqualified Stock solely because the holders thereof have the right to require the Company to repurchase such Capital Stock upon the occurrence of a change of control or asset sale (howsoever defined or referred to) shall not constitute Disqualified Stock if any such redemption or repurchase obligation is subject to compliance by the relevant Person with Section 3.5 hereof; provided, however, that if such Capital Stock is issued to any plan for the benefit of employees of the Company or its Subsidiaries or by any such plan to such employees, such Capital Stock shall not constitute Disqualified Stock solely because it may be required to be repurchased by the Company or its Subsidiaries in order to satisfy applicable statutory or regulatory obligations.

 

“Domestic Subsidiary” means, with respect to any Person, any Restricted Subsidiary of such Person other than a Foreign Subsidiary.

 

“DTC” means The Depository Trust Company or any successor securities clearing agency.

 

“Equity Offering” means (x) a sale of Capital Stock of the Company (other than Disqualified Stock) other than sales to a Subsidiary of the Company or offerings registered on Form S-8 (or any successor form) under the Securities Act or any similar offering in other jurisdictions, or (y) the sale of Capital Stock or other securities by a Parent, the proceeds of which are contributed to the equity (other than through the issuance of Disqualified Stock or sales to the Company or a Subsidiary of the Company) of the Company or any of its Restricted Subsidiaries.

 

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC promulgated thereunder, as amended.

 

“Excluded Restricted Subsidiary” means any Subsidiary of the Company that is designated as a Restricted Subsidiary but prohibited, in the reasonable judgment of senior management of the Company, from guaranteeing the Notes by any applicable law, regulation or contractual restrictions existing at the time such Subsidiary becomes a Restricted Subsidiary and which, in the case of any such contractual restriction, in the reasonable judgment of senior management of the Company, cannot be removed through commercially reasonable efforts; provided that a Subsidiary shall be deemed to be an Excluded Restricted Subsidiary if, in the reasonable judgment of senior management of the Company, such a Subsidiary guaranteeing the Notes would require any of the Issuers or their Restricted Subsidiaries to register as an “investment company” (as that term is defined in the Investment Company Act of 1940, as amended), or from otherwise becoming subject to regulation under the Investment Company Act of 1940, as amended.

 

“fair market value” may be conclusively established by means of an Officer’s Certificate or resolutions of the Board of Directors of the Company setting out such fair market value as determined by such Officer or such Board of Directors in good faith.

 

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“Fitch” means Fitch Ratings, Inc. or any of its successors or assigns that is a Nationally Recognized Statistical Rating Organization.

 

“Foreign Subsidiary” means, with respect to any Person, (a) any Subsidiary of such Person that is not organized or existing under the laws of the United States, any state thereof or the District of Columbia, and any Subsidiary of such Subsidiary and (b) any Restricted Subsidiary of such Person that has no material assets other than Capital Stock of one or more Foreign Subsidiaries (or Subsidiaries thereof).

 

“GAAP” means generally accepted accounting principles in the United States of America as in effect on the date of any calculation or determination required hereunder. Except as otherwise set forth in this Indenture, all ratios and calculations based on GAAP contained in this Indenture shall be computed in accordance with GAAP; provided that for purposes of determining such ratios and calculations the Company shall make such adjustments as it determines in good faith are necessary to remove the impact of consolidating any variable interest entities under the requirements of ASC 810, as such ASC section is in effect on the Issue Date. At any time after the Issue Date, the Company may elect to establish that GAAP shall mean the GAAP as in effect on or prior to the date of such election; provided that any such election, once made, shall be irrevocable. At any time after the Issue Date, the Company may elect to apply IFRS accounting principles in lieu of GAAP and, upon any such election, references herein to GAAP shall thereafter be construed to mean IFRS (except as otherwise provided in this Indenture), including as to the ability of the Company to make an election pursuant to the previous sentence; provided that any such election, once made, shall be irrevocable; provided, further, that any calculation or determination in this Indenture that requires the application of GAAP for periods that include fiscal quarters ended prior to the Company’s election to apply IFRS shall remain as previously calculated or determined in accordance with GAAP; provided, further again, that the Company may only make such election if it also elects to report any subsequent financial reports required to be made by the Company, including pursuant to Section 13 or Section 15(d) of the Exchange Act and Section 3.6 hereof, in IFRS. The Company shall give notice of any such election made in accordance with this definition to the Trustee and the Holders.

 

“Guarantee” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person, including any such obligation, direct or indirect, contingent or otherwise, of such Person:

 

(a)           to purchase or pay (or advance or supply funds for the purchase or payment of) such Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services, to take-or-pay or to maintain financial statement conditions or otherwise); or

 

(b)           entered into primarily for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part);

 

provided, however, that the term “Guarantee” will not include endorsements for collection or deposit in the ordinary course of business or consistent with past practice, and provided further

 

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that the amount of any Guarantee shall be deemed to be the lower of (i) an amount equal to the stated or determinable amount of the primary obligation in respect of which such Guarantee is made and (ii) the maximum amount for which such guaranteeing Person may be liable pursuant to the terms of the instrument embodying such Guarantee or, if such Guarantee is not an unconditional Guarantee of the entire amount of the primary obligations and such maximum amount is not stated or determinable, the amount of such guaranteeing Person’s maximum reasonably anticipated liability in respect thereof as determined by such Person in good faith. The term “Guarantee” used as a verb has a corresponding meaning.

 

“Guarantor” means any Parent or any Restricted Subsidiary that Guarantees the Notes, until such Guarantee is released in accordance with the terms of this Indenture; provided that any Excluded Restricted Subsidiary and any Securitization Entities shall not be deemed Guarantors.

 

“Hedging Obligations” means, with respect to any Person, the obligations of such Person under any interest rate swap, cap or collar agreements, interest rate future or option contracts, commodity swap, cap or collar agreements, foreign exchange contracts, currency swap agreements, currency future or option contracts, credit-related derivatives and hedging instruments and other hedging agreements and transactions intended to hedge against financial risk.

 

“Holder” means each Person in whose name the Notes are registered on the Registrar’s books, which shall initially be the respective nominee of DTC.

 

“IAI” means an institutional “accredited investor” as described in Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

 

“IFRS”means International Financial Reporting Standards, as issued by the International Accounting Standards Board as in effect from time to time.

 

“Immaterial Subsidiary” means, at any date of determination, each Restricted Subsidiary that (i) has not guaranteed any other Indebtedness of the Company and (ii) has Total Assets together with all other Immaterial Subsidiaries (as determined in accordance with GAAP) and consolidated operating income of less than 5.0% of the Company’s Total Assets and consolidated operating income (measured, in the case of operating income, at the end of the most recent fiscal period for which internal financial statements are available and, in the case of operating income, for the four quarters ended most recently for which internal financial statements are available, in each case measured on a pro forma basis giving effect to any acquisitions or dispositions of companies, division or lines of business since such balance sheet date or the start of such four quarter period, as applicable, and on or prior to the date of acquisition of such Subsidiary).

 

“Incur” means issue, create, assume, enter into any Guarantee of, incur, extend or otherwise become liable for; provided, however, that any Indebtedness or Capital Stock of a Person existing at the time such Person becomes a Restricted Subsidiary (whether by merger, consolidation, acquisition or otherwise) will be deemed to be Incurred by such Restricted Subsidiary at the time it becomes a Restricted Subsidiary and the terms “Incurred” and “Incurrence” have meanings correlative to the foregoing and any Indebtedness pursuant to any

 

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revolving credit or similar facility shall only be “Incurred” at the time any funds are borrowed thereunder.

 

“Indebtedness” means, with respect to any Person on any date of determination (without duplication):

 

(a)           the principal of indebtedness of such Person for borrowed money;

 

(b)           the principal of obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;

 

(c)           all reimbursement obligations of such Person in respect of letters of credit, bankers’ acceptances or other similar instruments (the amount of such obligations being equal at any time to the aggregate then undrawn and unexpired amount of such letters of credit or other instruments plus the aggregate amount of drawings thereunder that have not been reimbursed) (except to the extent such reimbursement obligations relate to trade payables and such obligations are satisfied within 30 days of Incurrence);

 

(d)           the principal component of all obligations of such Person to pay the deferred and unpaid purchase price of property (except trade payables or similar obligations to a trade creditor), which purchase price is due more than one year after the date of placing such property in service or taking final delivery and title thereto;

 

(e)           Capitalized Lease Obligations of such Person;

 

(f)            the principal component of all obligations, or liquidation preference, of such Person with respect to any Disqualified Stock or, with respect to any Restricted Subsidiary, any Preferred Stock (but excluding, in each case, any accrued dividends);

 

(g)           the principal component of all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided, however, that the amount of such Indebtedness will be the lesser of (a) the fair market value of such asset at such date of determination (as determined in good faith by the Company) and (b) the amount of such Indebtedness of such other Persons;

 

(h)           Guarantees by such Person of the principal component of Indebtedness of other Persons to the extent Guaranteed by such Person; and

 

(i)            to the extent not otherwise included in this definition, net obligations of such Person under Hedging Obligations (the amount of any such obligations to be equal at any time to the net payments under such agreement or arrangement giving rise to such obligation that would be payable by such Person at the termination of such agreement or arrangement).

 

The term “Indebtedness” shall not include any lease, concession or license of property (or Guarantee thereof) which would be considered an operating lease under GAAP as in effect on the Issue Date, any prepayments of deposits received from clients or customers in the ordinary course of business or consistent with past practice, or obligations under any license, permit or other approval (or Guarantees given in respect of such obligations) Incurred prior to the Issue

 

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Date or in the ordinary course of business or consistent with past practice. For purposes of clarity, it is understood and agreed that, anything in this Indenture to the contrary notwithstanding, Indebtedness of variable interest entities (within the meaning of GAAP) shall not be deemed Indebtedness of any Person or any of its Subsidiaries.

 

The amount of Indebtedness of any Person at any time in the case of a revolving credit or similar facility shall be the total amount of funds borrowed and then outstanding. The amount of Indebtedness of any Person at any date shall be determined as set forth above or otherwise provided in this Indenture, and (other than with respect to letters of credit or Guarantees or Indebtedness specified in clause (7) above) shall equal the amount thereof that would appear on a balance sheet of such Person (excluding any notes thereto) prepared on the basis of GAAP.

 

Notwithstanding the above provisions, in no event shall the following constitute Indebtedness:

 

(i)            Contingent Obligations Incurred in the ordinary course of business or consistent with past practice;

 

(ii)           Cash Management Services;

 

(iii)          in connection with the purchase by the Company or any Restricted Subsidiary of any business, any post-closing payment adjustments to which the seller may become entitled to the extent such payment is determined by a final closing balance sheet or such payment depends on the performance of such business after the closing; provided, however, that, at the time of closing, the amount of any such payment is not determinable and, to the extent such payment thereafter becomes fixed and determined, the amount is paid in a timely manner; or

 

(iv)          for the avoidance of doubt, any obligations in respect of workers’ compensation claims, early retirement or termination obligations, pension fund obligations or contributions or similar claims, obligations or contributions or social security or wage Taxes.

 

“Indenture” means this Indenture as amended or supplemented from time to time.

 

“Initial Notes” has the meaning ascribed to it in the second introductory paragraph of this Indenture.

 

“Investment Grade” means (i) BBB- or higher by S&P, (ii) Baa3 or higher by Moody’s or (iii) the equivalent of such ratings by S&P or Moody’s, or of another Nationally Recognized Statistical Ratings Organization.

 

“Investment Grade Status” shall occur when the Notes receive two of the following:

 

(a)           a rating of “BBB-” or higher from S&P;

 

(b)           a rating of “Baa3” or higher from Moody’s; and

 

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(c)           a rating of “BBB-” or higher from Fitch.

 

or the equivalent of such rating by either such rating organization or, if no rating of S&P, Moody’s or Fitch then exists, the equivalent of such rating by any other Nationally Recognized Statistical Ratings Organization.

 

“Issue Date” means September 25, 2017.

 

“Issuers” means the Company and the Co-Issuer.

 

“Joint Venture” means, as to any Person, any other Person designated as a “joint venture” (1) that is not a Subsidiary of such Person, (2) in which such Person owns less than 100% of the equity or voting interests and (3) which Person is engaged in a Similar Business, including making investments in real estate and real estate related assets.

 

“Lien” means any mortgage, pledge, security interest, encumbrance, lien or charge of any kind (including any conditional sale or other title retention agreement or lease in the nature thereof).

 

“Management Advances” means loans or advances made to, or Guarantees with respect to loans or advances made to, directors, officers, employees or consultants of any Parent, the Company or any Restricted Subsidiary:

 

(a)           (a) in respect of travel, entertainment or moving related expenses Incurred in the ordinary course of business or consistent with past practice or (b) for purposes of funding any such person’s purchase of Capital Stock (or similar obligations) of the Company, its Subsidiaries or any Parent with (in the case of this sub-clause (b)) the approval of the Board of Directors;

 

(b)           in respect of moving related expenses Incurred in connection with any closing or consolidation of any facility or office; or

 

(c)           not exceeding $10.0 million in the aggregate outstanding at any time.

 

“Moody’s” means Moody’s Investors Service, Inc. or any of its successors or assigns that is a Nationally Recognized Statistical Rating Organization.

 

“Nationally Recognized Statistical Rating Organization” means a nationally recognized statistical rating organization within the meaning of Rule 436 under the Securities Act.

 

“Non-Funding Indebtedness” means Indebtedness other than Permitted Funding Indebtedness.

 

“Non-Guarantor” means any Restricted Subsidiary that is not a Guarantor.

 

“Non-Recourse Indebtedness” means Indebtedness for borrowed money of a Restricted Subsidiary (or group of Restricted Subsidiaries) of the Company, with respect to which recourse for payment is limited to investment assets of such Restricted Subsidiary (or such group of

 

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Restricted Subsidiaries) encumbered by a Lien securing such Indebtedness and/or the general credit of such Restricted Subsidiary (or group of Restricted Subsidiaries) but for which recourse shall not extend to the general credit of the Company or any other of its Restricted Subsidiaries, it being understood that the instruments governing such Indebtedness may include customary carve-outs to such limited recourse such as, for example, personal recourse to the Company or its Subsidiaries for breach of representations, fraud, misapplication or misappropriation of cash, voluntary or involuntary bankruptcy filings, violation of loan document prohibitions against transfer of assets or ownership interests therein, environmental liabilities, and liabilities and other circumstances customarily excluded by lenders from exculpation provisions and/or included in separate indemnification and/or guaranty agreements in financings of loan assets, unless, until and for so long as a claim for payment or performance has been made thereunder (which has not been satisfied) at which time the obligations with respect to any such customary carve-out shall not be considered Non-Recourse Indebtedness, to the extent that such claim is a liability of the Company for GAAP purposes.

 

“Non-U.S. Person” means a Person who is not a U.S. Person (as defined in Regulation S).

 

“Note Documents” means the Notes (including Additional Notes), the Guarantees and this Indenture.

 

“Notes” has the meaning ascribed to it in the second introductory paragraph of this Indenture.

 

“Notes Custodian” means the custodian with respect to the Global Notes (as appointed by DTC), or any successor Person thereto and shall initially be the Trustee.

 

“Offering Memorandum” means the final offering memorandum, dated September 11, 2017, relating to the offering by the Issuers of $400,000,000 aggregate principal amount of 5.250% senior notes due 2025 and any future offering memorandum relating to Additional Notes.

 

“Officer” means, with respect to any Person, (1) the Chief Executive Officer, the President, the Chief Investment Officer, the Chief Operating Officer, the Chief Financial Officer, any Vice President, the Treasurer, any Managing Director, the Secretary, the General Counsel,  the Head of Merchant Banking & Capital Markets or the Head of Asset Management (a) of such Person, (b) if such Person is owned or managed by a single entity, of such entity or (c) if such Person is serialized, of any series of such Person, or (2) any other individual designated as an “Officer” for the purposes of this Indenture by the Board of Directors of such Person.

 

“Officer’s Certificate” means, with respect to any Person, a certificate signed by one Officer of such Person and meeting the requirements of this Indenture.

 

“Opinion of Counsel” means a written opinion from legal counsel reasonably satisfactory to the Trustee. The counsel may be an employee of or counsel to the Company or its Subsidiaries.

 

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“Parent” means any Person of which the Company at any time is or becomes a Subsidiary after the Issue Date and any holding companies established by any Permitted Holder for purposes of holding its investment in any Parent.

 

“Paying Agent” means any Person authorized by the Company to pay the principal of (and premium, if any) or interest on any Note on behalf of the Company.

 

“Permitted Funding Indebtedness” means (i) any Indebtedness Incurred in connection with investment activities of a Similar Business, including Indebtedness to finance real estate and real estate related assets and Non-Recourse Indebtedness, as well as any Indebtedness Incurred by the Issuers and their Subsidiaries in the ordinary course of their respective businesses and (ii) any Refinancing of the Indebtedness under clause (i); provided, however that the excess (determined as of the most recent date for which internal financial statements are available), if any, of (x) the amount of any Indebtedness incurred in accordance with this clause (ii) for which the holder thereof has contractual recourse to the Company or its Restricted Subsidiaries to satisfy claims with respect thereto over (y) the aggregate (without duplication of amounts) Realizable Value of the assets that secure such Indebtedness shall not be Permitted Funding Indebtedness (but shall not be deemed to be a new incurrence of Indebtedness subject to the provisions of Section 3.2, except with respect to, and solely to the extent of, any such excess that exists upon the initial incurrence of such Indebtedness incurred under this clause (ii) which excess shall be entitled to be incurred pursuant to any other provision under Section 3.2). The amount of any Permitted Funding Indebtedness shall be determined in accordance with the definition of “Indebtedness.”

 

“Permitted Holders” means, collectively, (1) any Person who beneficially owns more than 10% of the total voting power of the Voting Stock of the Company or any of its Parents as of the Issue Date, together with such Persons’ Affiliates (other than an operating company with an existing business), (2) any one or more Persons, together with such Persons’ Affiliates, whose beneficial ownership constitutes or results in a Change of Control in respect of which a Change of Control Offer is made in accordance with the requirements of this Indenture, (3) Senior Management, (4) any Person who is acting as an underwriter in connection with a public or private offering of Capital Stock of any Parent or the Company, acting in such capacity, and (5) any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the foregoing are members; provided that, in the case of such group and without giving effect to the existence of such group or any other group and members of management, collectively, have beneficial ownership of more than 50% of the total voting power of the Voting Stock of the Company or any of its Parents held by such group.

 

“Permitted Securitization Indebtedness” means Securitization Indebtedness; provided that (i) in connection with any Securitization, any other Permitted Funding Indebtedness used to finance the purchase, origination or pooling of any Receivables subject to such Securitization is repaid in connection with such Securitization to the extent of the net proceeds received by the Company and its Restricted Subsidiaries from the applicable Securitization Entity, and (ii) the excess (determined as of the most recent date for which internal financial statements are available), if any, of (x) the amount of any such Securitization Indebtedness for which the holder thereof has contractual recourse to the Company or its Restricted Subsidiaries to satisfy claims with respect to such Securitization Indebtedness (excluding recourse for matters such as fraud,

 

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misappropriation, breaches of representations and warranties and misapplication) over (y) the aggregate (without duplication of amounts) Realizable Value of the assets that secure such Securitization Indebtedness shall not be Permitted Securitization Indebtedness (but shall not be deemed to be a new incurrence of Indebtedness subject to the provisions of Section 3.2 except with respect to, and solely to the extent of, any such excess that exists upon the initial incurrence of such Indebtedness which excess shall be entitled to be incurred pursuant to any other provisions of Section 3.2).

 

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

 

“Predecessor Note” of any particular Note means every previous Note evidencing all or a portion of the same debt as that evidenced by such particular Note; and, for the purposes of this definition, any Note authenticated and delivered under Section 2.11 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Note shall be deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Note.

 

“Preferred Stock,” as applied to the Capital Stock of any Person, means Capital Stock of any class or classes (however designated) which is preferred as to the payment of dividends or as to the distribution of assets upon any voluntary or involuntary liquidation or dissolution of such Person, over shares of Capital Stock of any other class of such Person.

 

“Purchase Money Obligations” means any Indebtedness Incurred to finance or refinance the acquisition, leasing, construction or improvement of property (real or personal) or assets (including Capital Stock), and whether acquired through the direct acquisition of such property or assets or the acquisition of the Capital Stock of any Person owning such property or assets, or otherwise.

 

“QIB” means any “qualified institutional buyer” as such term is defined in Rule 144A.

 

“Rating Agency” means (1) each of Moody’s and S&P and (2) if Moody’s or S&P ceases to rate the Notes for reasons outside of the Company’s control, a Nationally Recognized Statistical Rating Organization selected by the Company or any parent of the Company as a replacement agency for Moody’s or S&P, as the case may be.

 

“Ratings Decline Period” means the period that (i) begins on the earlier of (a) a Change of Control or (b) the first public notice of the intention by the Company to affect a Change of Control and (ii) ends 60 days following the consummation of such Change of Control; provided, that such period will be extended so long as the rating of the Notes is under publicly announced consideration for a possible downgrade by any of the Rating Agencies.

 

“Ratings Event” means (x) a downgrade by one or more gradations (including gradations within ratings categories as well as between categories) or withdrawal of the rating of the Notes within the Ratings Decline Period by one or more Rating Agencies if the applicable Rating Agency shall have put forth a statement to the effect that such downgrade is attributable in whole or in part to the applicable Change of Control and (y) the Notes do not have an Investment Grade Status from either Rating Agency.

 

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“Realizable Value” of an asset means the lesser of (x) if applicable, the face value of such asset and (y) the market value of such asset as determined by the Company in accordance with the agreement governing the applicable Permitted Funding Indebtedness, as the case may be, (or, if such agreement does not contain any related provision, as determined in good faith by management of the Company); provided, however, that the realizable value of any asset described above which an unaffiliated third party has a binding contractual commitment to purchase from the Company or any of its Restricted Subsidiaries shall be the minimum price payable to the Company or such Restricted Subsidiary for such asset pursuant to such contractual commitment.

 

“Receivables” means loans and other mortgage-related receivables (excluding and net interest margin securities) purchased or originated by the Company or any Restricted Subsidiary of the Company or otherwise arising in the ordinary course of business or consistent with past practice; provided, however, that for purposes of determining the amount of a Receivable at any time, such amount shall be determined in accordance with GAAP, consistently applied, as of the most recent practicable date.

 

“Refinance” means refinance, refund, replace, renew, repay, modify, restate, defer, substitute, supplement, reissue, resell, extend or increase (including pursuant to any defeasance or discharge mechanism) and the terms “refinances,” “refinanced” and “refinancing” as used for any purpose in this Indenture shall have a correlative meaning.

 

“Refinancing Indebtedness” means Indebtedness that is Incurred to refund, refinance, replace, exchange, renew, repay or extend (including pursuant to any defeasance or discharge mechanism) any Indebtedness existing on the date of this Indenture or Incurred in compliance with this Indenture (including Indebtedness of the Company that refinances Indebtedness of any Restricted Subsidiary and Indebtedness of any Restricted Subsidiary that refinances Indebtedness of the Company or another Restricted Subsidiary) including Indebtedness that refinances Refinancing Indebtedness; provided, however, that:

 

(a)           the Refinancing Indebtedness has a final Weighted Average Life to Maturity at the time such Refinancing Indebtedness is Incurred that is the same as or greater than the final Weighted Average Life to Maturity of the Indebtedness being refinanced or, if less, the Notes and if the Indebtedness being refinanced constitutes Subordinated Indebtedness, such Refinancing Indebtedness is subordinated to the Notes on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being refinanced;

 

(b)           if the Indebtedness being refinanced constituted Subordinated Indebtedness, such Refinancing Indebtedness is subordinated to the Notes or the applicable Guarantee on terms at least as favorable to the Holders as those contained in the documentation governing the Indebtedness being refinanced; and

 

(c)           Refinancing Indebtedness shall not include:

 

(i)            Indebtedness, Disqualified Stock or Preferred Stock of a Subsidiary of the Company that is not a Guarantor that refinances Indebtedness, Disqualified Stock or Preferred Stock of the Company or a Guarantor; or

 

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(ii)           Indebtedness, Disqualified Stock or Preferred Stock of the Company or a Restricted Subsidiary that refinances Indebtedness, Disqualified Stock or Preferred Stock of an Unrestricted Subsidiary.

 

Refinancing Indebtedness in respect of any Credit Facility or any other Indebtedness may be Incurred from time to time after the termination, discharge or repayment of any such Credit Facility or other Indebtedness.

 

“Regulation S” means Regulation S under the Securities Act.

 

“Regulation S-X” means Regulation S-X under the Securities Act.

 

“Restricted Notes” means Initial Notes and Additional Notes bearing one of the restrictive legends described in Section 2.1(d).

 

“Restricted Notes Legend” means the legend set forth in Section 2.1(d)(1) and, in the case of the Temporary Regulation S Global Note, the legend set forth in Section 2.1(d)(2).

 

“Required Asset Sale” means any asset sale that is a result of a repurchase right or obligation or a mandatory sale right or obligation related to Permitted Funding Indebtedness, which rights or obligations are either in existence on the Issue Date (or substantially similar in nature to such rights or obligations in existence on the Issue Date) or pursuant to the guidelines or regulations of a government-sponsored enterprise.

 

“Restricted Subsidiary” means any Subsidiary of the Company other than an Unrestricted Subsidiary.

 

“Rule 144A” means Rule 144A under the Securities Act.

 

“S&P” means Standard & Poor’s Investors Ratings Services or any of its successors or assigns that is a Nationally Recognized Statistical Rating Organization.

 

“SEC” means the U.S. Securities and Exchange Commission or any successor thereto.

 

“Secured Indebtedness” means any Indebtedness of the Company or any of its Restricted Subsidiaries secured by a Lien upon the property of the Company or any of its Restricted Subsidiaries.

 

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

 

“Securitization” means a public or private transfer, sale or financing of servicing advances, mortgage loans, installment contracts, other loans, accounts receivable, real estate assets, mortgage receivables and any other assets capable of being securitized (collectively, the “Securitization Assets”) by which the Company or any of its Restricted Subsidiaries directly or indirectly securitizes a pool of specified Securitization Assets including any such transaction involving the sale of specified servicing advances or mortgage loans to a Securitization Entity.

 

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“Securitization Asset” has the meaning set forth in the definition of “Securitization.”

 

“Securitization Entity” means (i) any Person (whether or not a Restricted Subsidiary of the Company) established for the purpose of issuing asset-backed or mortgage-backed or mortgage pass-through securities of any kind (including collateralized mortgage obligations and net interest margin securities), (ii) any special purpose Subsidiary established for the purpose of selling, depositing or contributing Securitization Assets into a Person described in clause (i) or holding securities in any related Securitization Entity, regardless of whether such person is an issuer of securities; provided that such person is not an obligor with respect to any Indebtedness of the Company or any Guarantor and (iii) any special purpose Subsidiary of the Company formed exclusively for the purpose of satisfying the requirements of Credit Enhancement Agreements and regardless of whether such Subsidiary is an issuer of securities; provided that such person is not an obligor with respect to any Indebtedness of the Company or any Guarantor other than under Credit Enhancement Agreements. As of the Issue Date, none of the Subsidiaries of the Company are Securitization Entities.

 

“Securitization Indebtedness” means (i) Indebtedness of the Company or any of its Restricted Subsidiaries incurred pursuant to on-balance sheet Securitizations treated as financings and (ii) any Indebtedness consisting of advances made to the Company or any of its Restricted Subsidiaries based upon securities issued by a Securitization Entity pursuant to a Securitization and acquired or retained by the Company or any of its Restricted Subsidiaries.

 

“Senior Management” means the officers, directors, and other members of senior management of the Company or any of its Subsidiaries on the Issue Date, who at any date beneficially own or have the right to acquire, directly or indirectly, Capital Stock of the Company or any of its Subsidiaries.

 

“Significant Subsidiary” means any Restricted Subsidiary that would be a “significant subsidiary” as defined in Article 1, Rule 1-02 of Regulation S-X, promulgated pursuant to the Securities Act, as such regulation is in effect on the Issue Date.

 

“Similar Business” means (a) any businesses, services or activities engaged in by the Issuers or any of their Subsidiaries or any Associates on the Issue Date and (b) any businesses, services and activities engaged in by the Issuers or any of their Subsidiaries or any Associates that are related, complementary, incidental, ancillary or similar to any of the foregoing or are extensions, expansions or developments of any thereof.

 

“Stated Maturity” means, with respect to any security, the date specified in such security as the fixed date on which the payment of principal of such security is due and payable, including pursuant to any mandatory redemption provision, but shall not include any contingent obligations to repay, redeem or repurchase any such principal prior to the date originally scheduled for the payment thereof.

 

“Subordinated Indebtedness” means, with respect to any person, any Indebtedness (whether outstanding on the Issue Date or thereafter Incurred) which is expressly subordinated in right of payment to the Notes pursuant to a written agreement.

 

“Subsidiary” means, with respect to any Person:

 

19

 

(a)           any corporation, association, or other business entity (other than a partnership, Joint Venture, limited liability company or similar entity) of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time of determination owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof; or

 

(b)           any partnership, Joint Venture, limited liability company or similar entity or series thereof of which:

 

(i)            more than 50% of the capital accounts, distribution rights, total equity and voting interests or general or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or a combination thereof whether in the form of membership, general, special or limited partnership interests or otherwise; and

 

(ii)           such Person or any Subsidiary of such Person is a controlling general partner or otherwise controls such entity.

 

For purposes of clarity, it is understood and agreed that, anything in this Indenture to the contrary notwithstanding, variable interest entities (within the meaning of GAAP) shall not be deemed to be Subsidiaries of any Person.

 

“Taxes” means all present and future taxes, levies, imposts, deductions, charges, duties and withholdings and any charges of a similar nature (including interest, penalties and other liabilities with respect thereto) that are imposed by any government or other taxing authority.

 

“Total Assets” mean, as of any date, the total assets of the Company and its Restricted Subsidiaries on a consolidated basis, as shown on the most recent consolidated balance sheet of the Company and its Restricted Subsidiaries that is internally available, determined on a pro forma basis in a manner consistent with the pro forma basis contained in the definition of Consolidated Non-Funding Debt to Equity Ratio.

 

“Total Unencumbered Assets” mean, as of any date, the sum of (1) those Undepreciated Real Estate Assets not securing any portion of Secured Indebtedness; and (2) all other assets (but excluding goodwill) of the Company and its Subsidiaries not securing any portion of Secured Indebtedness, determined on a consolidated basis for the Company and its Subsidiaries in accordance with GAAP. For the avoidance of doubt, Liens on the stock of the Subsidiaries of the Company required by the terms of any Credit Facility shall be disregarded for purposes of this definition and neither the stock of such Subsidiaries nor the assets held by such Subsidiaries shall be deemed to secure any portion of Secured Indebtedness solely as a result of such Liens.

 

“TIA” means the Trust Indenture Act of 1939, as amended.

 

“Treasury Rate” means, at the time of computation, the weekly average rounded to the nearest 1/100th of a percentage point (for the most recently completed week for which such information is available as of the date that is two business days prior to the redemption date) of the yield to maturity of United States Treasury Securities with a constant maturity (as compiled

 

20

 

and published in Federal Reserve Statistical Release H.15 with respect to each applicable day during such week or, if such Statistical Release is no longer published, any publicly available source of similar market data selected by the Company in good faith) most nearly equal to the period from the redemption date to October 1, 2020; provided, however, that if the period from the redemption date to October 1, 2020 is not equal to the constant maturity of a United States Treasury Security for which such a yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States Treasury Securities for which such yields are given, except that if the period from the redemption date to October 1, 2020 is less than one year, the weekly average yield on actually traded United States Treasury Securities adjusted to a constant maturity of one year shall be used.

 

“Trustee” means the party named as such in this Indenture until a successor replaces it and, thereafter, means the successor.

 

“Trust Officer” shall mean, when used with respect to the Trustee, any vice president, assistant vice president, any trust officer or any other officer of the Trustee, as applicable, who customarily performs functions similar to those performed by the Persons who at the time shall be such officers, respectively, or to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who, in each case, shall have direct responsibility for the administration of this Indenture.

 

“Undepreciated Real Estate Assets” means, as of any date, the cost (being the original cost to the Company or any of its Restricted Subsidiaries plus capital improvements) of real estate assets of the Company and its Restricted Subsidiaries on such date, before depreciation and amortization of such real estate assets determined on a consolidated basis in accordance with GAAP. For the avoidance of doubt, it is understood and agreed that, anything in the foregoing sentence to the contrary notwithstanding, the cost of real estate assets shall include any portion of such cost that may be allocated to intangible assets under GAAP.

 

“Unrestricted Subsidiary” means:

 

(a)           any Subsidiary of the Company that at the time of determination is an Unrestricted Subsidiary (as designated by the Company in the manner provided below); and

 

(b)           any Subsidiary of an Unrestricted Subsidiary.

 

The Company may designate any Subsidiary of the Company (including any newly acquired or newly formed Subsidiary or a Person becoming a Subsidiary through merger, consolidation or other business combination transaction, or investment therein) to be an Unrestricted Subsidiary only if such Subsidiary or any of its Subsidiaries does not own any Capital Stock or Indebtedness of, or own or hold any Lien on any property of, the Company or any other Subsidiary of the Company which is not a Subsidiary of the Subsidiary to be so designated or otherwise an Unrestricted Subsidiary.

 

“Unsecured Indebtedness” means Indebtedness of the Company or any of its Restricted Subsidiaries that is not Secured Indebtedness determined on a consolidated basis in accordance with GAAP.

 

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“U.S. Government Obligations” means securities that are (1) direct obligations of the United States of America for the timely payment of which its full faith and credit is pledged or (2) obligations of a Person controlled or supervised by and acting as an agency or instrumentality of the United States of America the timely payment of which is unconditionally Guaranteed as a full faith and credit obligation of the United States of America, which, in either case, are not callable or redeemable at the option of the Company thereof, and shall also include a depositary receipt issued by a bank (as defined in Section 3(a)(2) of the Securities Act), as custodian with respect to any such U.S. Government Obligations or a specific payment of principal of or interest on any such U.S. Government Obligations held by such custodian for the account of the holder of such depositary receipt; provided that (except as required by law) such custodian is not authorized to make any deduction from the amount payable to the holder of such depositary receipt from any amount received by the custodian in respect of the U.S. Government Obligations or the specific payment of principal of or interest on the U.S. Government Obligations evidenced by such depositary receipt.

 

“Voting Stock” of a Person means all classes of Capital Stock of such Person then outstanding and normally entitled to vote in the election of directors.

 

“Weighted Average Life to Maturity” means, when applied to any Indebtedness, Disqualified Stock or Preferred Stock, as the case may be, at any date, the quotient obtained by dividing:

 

(a)           the sum of the products of the number of years from the date of determination to the date of each successive scheduled principal payment of such Indebtedness or redemption or similar payment with respect to such Disqualified Stock or Preferred Stock multiplied by the amount of such payment, by

 

(b)           the sum of all such payments.

 

“Wholly Owned Domestic Subsidiary” means a Domestic Subsidiary of the Company, all of the Capital Stock of which is owned by the Company.

 

Section 1.2            Other Definitions.

 

	
Term
    	
 
    	
Defined   in Section
    
	
“Accredited Investor   Note”
    	
 
    	
2.1(b)
    
	
“Additional   Restricted Notes”
    	
 
    	
2.1(b)
    
	
“Affiliate   Transaction”
    	
 
    	
3.8(a)
    
	
“Agent Members”
    	
 
    	
2.1(g)(2)
    
	
“Authenticating   Agent”
    	
 
    	
2.2
    
	
“bankruptcy   provisions”
    	
 
    	
6.1(a)(5)(F)
    
	
“Change of Control   Offer”
    	
 
    	
3.5(a)
    
	
“Change of Control   Payment”
    	
 
    	
3.5(a)(2)
    
	
“Change of Control   Payment Date”
    	
 
    	
3.5(a)
    
	
“Clearstream”
    	
 
    	
2.1(b)
    
	
“Covenant Defeasance”
    	
 
    	
8.3
    
	
“cross acceleration   provision”
    	
 
    	
6.1(a)(4)(B)
    

 

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“Defaulted Interest”
    	
 
    	
2.15
    
	
“Defeasance Trust”
    	
 
    	
8.4(1)
    
	
“Euroclear”
    	
 
    	
2.1(b)
    
	
“Event of Default”
    	
 
    	
6.1(a)
    
	
“Global Notes”
    	
 
    	
2.1(b)
    
	
“Guaranteed   Obligations”
    	
 
    	
10.1
    
	
“Institutional   Accredited Investor Global Note”
    	
 
    	
2.1(b)
    
	
“Institutional   Accredited Investor Notes”
    	
 
    	
2.1(b)
    
	
“Issuers Order”
    	
 
    	
2.2
    
	
“judgment default provision”
    	
 
    	
6.1(a)(7)
    
	
“Legal Defeasance”
    	
 
    	
8.2
    
	
“Legal Holiday”
    	
 
    	
12.8
    
	
“New York Presence   Obligor”
    	
 
    	
12.21(b)
    
	
“New York Process   Agent”
    	
 
    	
12.21(b)
    
	
“Notes Register”
    	
 
    	
2.3
    
	
“payment default”
    	
 
    	
6.1(a)(4)(A)
    
	
“Permitted Debt”
    	
 
    	
3.2(b)
    
	
“Process Agent”
    	
 
    	
12.21(a)
    
	
“protected purchaser”
    	
 
    	
2.11
    
	
“Redemption Date”
    	
 
    	
5.7(a)
    
	
“Registrar”
    	
 
    	
2.3
    
	
“Regulation S Global   Note”
    	
 
    	
2.1(b)
    
	
“Regulation S Notes”
    	
 
    	
2.1(b)
    
	
“Resale Restriction   Termination Date”
    	
 
    	
2.6(b)
    
	
“Reversion Date”
    	
 
    	
3.14(b)
    
	
“Rule 144A   Global Note”
    	
 
    	
2.1(b)
    
	
“Rule 144A   Notes”
    	
 
    	
2.1(b)
    
	
“Special Interest   Payment Date”
    	
 
    	
2.15(a)
    
	
“Special Record Date”
    	
 
    	
2.15(a)
    
	
“Successor Company”
    	
 
    	
4.1(a)(1)
    
	
“Suspended Covenants”
    	
 
    	
3.14(a)
    
	
“Suspension Period”
    	
 
    	
3.14(b)
    
	
“Third Party Process   Agent”
    	
 
    	
12.21(c)
    

 

Section 1.3            Inapplicability of Trust Indenture Act.  No provisions of the TIA are incorporated by reference in or made a part of this Indenture.  No terms that are defined under the TIA have such meanings for the purposes of this Indenture.

 

Section 1.4            Rules of Construction. Unless the context otherwise requires:

 

(a)           a term has the meaning assigned to it;

 

(b)           an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

 

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(c)           “or” is not exclusive;

 

(d)           “including” means including without limitation;

 

(e)           words in the singular include the plural and words in the plural include the singular;

 

(f)            “will” shall be interpreted to express a command;

 

(g)           all amounts expressed in this Indenture or in any of the Notes in terms of money refer to the lawful currency of the United States of America;

 

(h)           the words “herein,” “hereof” and “hereunder” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision;

 

(i)            unless otherwise specifically indicated, the term “consolidated” with respect to any Person refers to such Person consolidated with its Restricted Subsidiaries, and excludes from such consolidation any Unrestricted Subsidiary as if such Unrestricted Subsidiary were not an Affiliate of such Person; and

 

(j)            For the purposes of Section 6.1(a)(vi)(4), in respect of Parent, the making of a declaration that the affairs of Parent are en etat de désastre shall be deemed to be similar relief granted under foreign law.

 

Notwithstanding anything to the contrary in this Indenture (other than as set forth in Sections 3.2(a) and 4.1(a)(iii)), covenants requiring the Company to maintain ratios will be tested only as of the last day of the most recent fiscal quarter for which financial statements of the Company are available.  In the event that a required ratio is not then satisfied but the Company does satisfy such ratio as of a later date, then the Company will be deemed to have satisfied its obligations with respect to such ratio at such time and any Default with respect to such ratio shall be deemed to have been cured.

 

ARTICLE II

 

THE NOTES

 

Section 2.1            Form, Dating and Terms.

 

(a)           The aggregate principal amount of Notes that may be authenticated and delivered under this Indenture is unlimited. The Initial Notes issued on the date hereof will be in an aggregate principal amount of $400,000,000. In addition, the Issuers may issue, from time to time in accordance with the provisions of this Indenture, Additional Notes (as provided herein). Furthermore, Notes may be authenticated and delivered upon registration of transfer, exchange or in lieu of, other Notes pursuant to Sections 2.2, 2.6, 2.11, 2.13, 5.6 or 9.5 or in connection with a Change of Control Offer pursuant to Section 3.5.

 

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Notwithstanding anything to the contrary contained herein, the Issuers may not issue any Additional Notes, unless such issuance is in compliance with Section 3.2.

 

With respect to any Additional Notes, the Issuers shall set forth in (i) an Officer’s Certificate or (ii) one or more indentures supplemental hereto, the following information:

 

(1)           the aggregate principal amount of such Additional Notes to be authenticated and delivered pursuant to this Indenture;

 

(2)           the issue price and the issue date of such Additional Notes, including the date from which interest shall accrue; and

 

(3)           whether such Additional Notes shall be Restricted Notes.

 

In authenticating and delivering Additional Notes, the Trustee shall be entitled to receive and shall be fully protected in relying upon, in addition to the Opinion of Counsel and Officer’s Certificate required by Section 12.4, an Opinion of Counsel as to the due authorization, execution, delivery, validity and enforceability of such Additional Notes.

 

The Initial Notes and the Additional Notes shall be considered collectively as a single class for all purposes of this Indenture. Holders of the Initial Notes and the Additional Notes will vote and consent together on all matters to which such Holders are entitled to vote or consent as one class, and none of the Holders of the Initial Notes or the Additional Notes shall have the right to vote or consent as a separate class on any matter to which such Holders are entitled to vote or consent.

 

(b)           The Initial Notes are being offered and sold by the Issuers pursuant to a Purchase Agreement, dated September 11, 2017, among the Issuers and the initial purchasers named therein. The Initial Notes and any Additional Notes (if issued as Restricted Notes) (the “Additional Restricted Notes”) will be resold initially only to (A) persons reasonably believed to be QIBs in reliance on Rule 144A and (B) Non-U.S. Persons in reliance on Regulation S. Such Initial Notes and Additional Restricted Notes may thereafter be transferred to, among others, persons reasonably believed to be QIBs, purchasers in reliance on Regulation S, AIs and IAIs in accordance with Rule 501 under the Securities Act, in each case, in accordance with the procedure described herein. Additional Notes offered after the date hereof may be offered and sold by the Issuers from time to time pursuant to one or more purchase agreements in accordance with applicable law.

 

Initial Notes and Additional Restricted Notes offered and sold to persons reasonably believed to be QIBs in the United States of America in reliance on Rule 144A (the “Rule 144A Notes”) will be issued in the form of a permanent global Note substantially in the form of Exhibit A, which is hereby incorporated by reference and made a part of this Indenture, including appropriate legends as set forth in Section 2.1(d) and (e) (the “Rule 144A Global Note”), deposited with the Trustee, as custodian for DTC, duly executed by the Issuers and authenticated by the Trustee as hereinafter provided. The Rule 144A Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principal amount of the

 

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Rule 144A Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.

 

Initial Notes and any Additional Restricted Notes offered and sold outside the United States of America (the “Regulation S Notes”) in reliance on Regulation S will be issued in the form of a global Note substantially in the form of Exhibit A, including appropriate legends as set forth in Section 2.1(d) and (e) (the “Regulation S Global Note”). Each Regulation S Global Note will be deposited upon issuance with, or on behalf of, the Trustee as custodian for DTC in the manner described in this Article II for credit to the respective accounts of the purchasers (or to such other accounts as they may direct), including, but not limited to, accounts at Euroclear Bank S.A./N.V. (“Euroclear”) or Clearstream Banking, société anonyme (“Clearstream”).

 

Investors may hold their interests in the Regulation S Global Note through organizations other than Euroclear or Clearstream that are participants in DTC’s system or directly through Euroclear or Clearstream, if they are participants in such systems, or indirectly through organizations which are participants in such systems. If such interests are held through Euroclear or Clearstream, Euroclear and Clearstream will hold such interests in the applicable Regulation S Global Note on behalf of their participants through customers’ securities accounts in their respective names on the books of their respective depositaries. Such depositaries, in turn, will hold such interests in the applicable Regulation S Global Note in customers’ securities accounts in the depositaries’ names on the books of DTC.

 

The Regulation S Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principal amount of the Regulation S Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.

 

Initial Notes and Additional Restricted Notes resold to IAIs (the “Institutional Accredited Investor Notes”) in the United States of America will be issued in the form of a permanent global Note substantially in the form of Exhibit A including appropriate legends as set forth in Section 2.1(d) and (e) (the “Institutional Accredited Investor Global Note”) deposited with the Trustee, as custodian for DTC, duly executed by the Issuers and authenticated by the Trustee as hereinafter provided. The Institutional Accredited Investor Global Note may be represented by more than one certificate, if so required by DTC’s rules regarding the maximum principal amount to be represented by a single certificate. The aggregate principal amount of the Institutional Accredited Investor Global Note may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for DTC or its nominee, as hereinafter provided.

 

Initial Notes and Additional Restricted Notes resold to AIs in the United States of America will be issued in the form of a Definitive Note substantially in the form of Exhibit A including the legend as set forth in Section 2.1(d) (an “Accredited Investor Note”).

 

The Rule 144A Global Note, the Regulation S Global Note, and the Institutional Accredited Investor Global Note are sometimes collectively herein referred to as the “Global Notes.”

 

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The principal of (and premium, if any) and interest on the Notes shall be payable at the office or agency of the Paying Agent designated by the Company maintained for such purpose (which shall initially be the office of the Trustee maintained for such purpose), or at such other office or agency of the Company as may be maintained for such purpose pursuant to Section 2.3; provided, however, that, at the option of the Paying Agent, each installment of interest may be paid by (i) check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Notes Register or (ii) wire transfer to an account located in the United States maintained by the payee, subject to the last sentence of this paragraph. Payments in respect of Notes represented by a Global Note (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by DTC. Payments in respect of Notes represented by Definitive Notes (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Notes represented by Definitive Notes will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion).

 

The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage, in addition to those set forth on Exhibit A and Exhibit B and in Section 2.1(d), (e) and (f). The Issuers shall approve any notation, endorsement or legend on the Notes. Each Note shall be dated the date of its authentication. The terms of the Notes set forth in Exhibit A and Exhibit B are part of the terms of this Indenture and, to the extent applicable, the Issuers and the Trustee, by their execution and delivery of this Indenture, expressly agree to be bound by such terms.

 

(c)                                  Denominations. The Notes shall be in minimum denominations of $2,000 and integral multiples of $1,000 in excess thereof.

 

(d)                                 Restrictive Legends. Unless and until (i) an Initial Note or an Additional Note issued as a Restricted Note is sold under an effective registration statement or (ii) the Trustee receives an Opinion of Counsel reasonably satisfactory to the Trustee and the Issuers to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act. The Rule 144A Global Note, the Regulation S Global Note, the Institutional Accredited Investor Global Note and the Accredited Investor Note shall each bear the following legend on the face thereof:

 

THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”), AND, ACCORDINGLY, MAY NOT BE OFFERED OR SOLD WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE HOLDER (1) REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT), (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT OR (C) IT IS AN ACCREDITED INVESTOR (AS DEFINED IN RULE 501(a)(1), (2), (3), OR (7) UNDER THE SECURITIES ACT) (AN “ACCREDITED

 

27

 

INVESTOR”), (2) AGREES THAT IT WILL NOT WITHIN ONE YEAR AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUERS OR ANY SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES ACT, (C) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR THAT, PRIOR TO SUCH TRANSFER, FURNISHES (OR HAS FURNISHED ON ITS BEHALF BY A U.S. BROKER-DEALER) TO THE TRUSTEE A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS RELATING TO THE RESTRICTIONS ON TRANSFER OF THIS SECURITY (THE FORM OF WHICH LETTER CAN BE OBTAINED FROM THE TRUSTEE FOR THIS SECURITY), (D) OUTSIDE THE UNITED STATES IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH RULE 904 UNDER THE SECURITIES ACT (IF AVAILABLE), (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), (F) IN ACCORDANCE WITH ANOTHER EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL IF THE ISSUERS SO REQUEST), OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN ONE YEAR AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY, IF THE PROPOSED TRANSFEREE IS AN ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUERS SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. AS USED HEREIN, THE TERMS “OFFSHORE TRANSACTION,” “UNITED STATES” AND “U.S. PERSON” HAVE THE MEANING GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES ACT.

 

(e)                                  Global Note Legend.

 

Each Global Note, whether or not an Initial Note, shall bear the following legend on the face thereof:

 

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

 

28

 

LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO DTC, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE INDENTURE REFERRED TO ON THE REVERSE HEREOF.

 

(f)                                   [Reserved]

 

(g)                                  Book-Entry Provisions. (i) This Section 2.1(g) shall apply only to Global Notes deposited with the Trustee, as custodian for DTC.

 

(i)                                     Each Global Note initially shall (x) be registered in the name of DTC or the nominee of DTC, (y) be delivered to the Notes Custodian for DTC and (z) bear legends as set forth in Section 2.1(e). Transfers of a Global Note (but not a beneficial interest therein) will be limited to transfers thereof in whole, but not in part, to the DTC, its successors or its respective nominees, except as set forth in Section 2.1(g)(4) and 2.1(h). If a beneficial interest in a Global Note is transferred or exchanged for a beneficial interest in another Global Note, the Notes Custodian will (x) record a decrease in the principal amount of the Global Note being transferred or exchanged equal to the principal amount of such transfer or exchange and (y) record a like increase in the principal amount of the other Global Note. Any beneficial interest in one Global Note that is transferred to a Person who takes delivery in the form of an interest in another Global Note, or exchanged for an interest in another Global Note, will, upon transfer or exchange, cease to be an interest in such Global Note and become an interest in the other Global Note and, accordingly, will thereafter be subject to all transfer and exchange restrictions, if any, and other procedures applicable to beneficial interests in such other Global Note for as long as it remains such an interest.

 

(ii)                                  Members of, or participants in, DTC (“Agent Members”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by DTC or by the Notes Custodian as the custodian of DTC or under such Global Note, and DTC may be treated by the Issuers, the Trustee and any agent of the Issuers or the Trustee as the absolute owner of such Global Note for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Issuers, the Trustee or any agent of the Issuers or the Trustee from giving effect to any written certification, proxy or other authorization furnished by DTC or impair, as between DTC and its Agent Members, the operation of customary practices of DTC governing the exercise of the rights of a holder of a beneficial interest in any Global Note.

 

(iii)                               In connection with any transfer of a portion of the beneficial interest in a Global Note pursuant to Section 2.1(h) to beneficial owners who are required to hold Definitive Notes, the Notes Custodian shall reflect on its books and records the date and a decrease in the principal amount of such Global Note in an amount equal to the principal amount of the beneficial interest in the Global Note to be transferred, and the Issuers shall execute, and the Trustee shall authenticate and make available for delivery, one or more Definitive Notes of like tenor and amount.

 

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(iv)                              In connection with the transfer of an entire Global Note to beneficial owners pursuant to Section 2.1(h), such Global Note shall be deemed to be surrendered to the Trustee for cancellation, and the Issuers shall execute, and the Trustee shall authenticate and make available for delivery, to each beneficial owner identified by DTC in exchange for its beneficial interest in such Global Note, an equal aggregate principal amount of Definitive Notes of authorized denominations.

 

(v)                                 The registered Holder of a Global Note may grant proxies and otherwise authorize any person, including Agent Members and persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Notes.

 

(vi)                              Any Holder of a Global Note shall, by acceptance of such Global Note, agree that transfers of beneficial interests in such Global Note may be effected only through a book-entry system maintained by (i) the Holder of such Global Note (or its agent) or (ii) any holder of a beneficial interest in such Global Note, and that ownership of a beneficial interest in such Global Note shall be required to be reflected in a book entry.

 

(h)                                 Definitive Notes. Except as provided below, owners of beneficial interests in Global Notes will not be entitled to receive Definitive Notes. Definitive Notes shall be transferred to all beneficial owners in exchange for their beneficial interests in a Global Note if (A) DTC notifies the Issuers that it is unwilling or unable to continue as Depositary for the Global Note and the Issuers fail to appoint a successor depositary within 90 days of such notice, (B) the Issuers, at their option, notify the Trustee that they elect to cause the issuance of Definitive Notes or (C) there shall have occurred and be continuing an Event of Default with respect to the Notes under this Indenture and DTC shall have requested the issuance of Definitive Notes. In the event of the occurrence of any of the events specified in the second preceding sentence or in clause (A), (B) or (C) of the preceding sentence, the Issuers shall promptly make available to the Trustee a reasonable supply of Definitive Notes. In addition, any Note transferred to an affiliate (as defined in Rule 405 under the Securities Act) of the Issuers or evidencing a Note that has been acquired by an affiliate in a transaction or series of transactions not involving any public offering must, until one year after the last date on which either the Issuers or any affiliate of the Issuers was an owner of the Note, be in the form of a Definitive Note and bear the legend regarding transfer restrictions in Section 2.1(d). If required to do so pursuant to any applicable law or regulation, beneficial owners may also obtain Definitive Notes in exchange for their beneficial interests in a Global Note upon written request in accordance with DTC’s and the Registrar’s procedures.

 

(i)                                     Any Definitive Note delivered in exchange for an interest in a Global Note pursuant to Section 2.1(g) shall, except as otherwise provided by Section 2.6(d), bear the applicable legend regarding transfer restrictions applicable to the Global Note set forth in Section 2.1(d).

 

(ii)                                  If a Definitive Note is transferred or exchanged for a beneficial interest in a Global Note, the Trustee will (x) cancel such Definitive Note, (y) record an increase in the principal amount of such Global Note equal to the principal amount of

 

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such transfer or exchange and (z) in the event that such transfer or exchange involves less than the entire principal amount of the canceled Definitive Note, the Issuers shall execute, and the Trustee shall authenticate and make available for delivery, to the transferring Holder a new Definitive Note representing the principal amount not so transferred.

 

(iii)                               If a Definitive Note is transferred or exchanged for another Definitive Note, (x) the Trustee will cancel the Definitive Note being transferred or exchanged, (y) the Issuers shall execute, and the Trustee shall authenticate and make available for delivery, one or more new Definitive Notes in authorized denominations having an aggregate principal amount equal to the principal amount of such transfer or exchange to the transferee (in the case of a transfer) or the Holder of the canceled Definitive Note (in the case of an exchange), registered in the name of such transferee or Holder, as applicable, and (z) if such transfer or exchange involves less than the entire principal amount of the canceled Definitive Note, the Issuers shall execute, and the Trustee shall authenticate and make available for delivery to the Holder thereof, one or more Definitive Notes in authorized denominations having an aggregate principal amount equal to the untransferred or unexchanged portion of the canceled Definitive Notes, registered in the name of the Holder thereof.

 

Section 2.2                                    Execution and Authentication. One Officer shall sign the Notes for the Issuers by manual, facsimile or PDF signature. If the Officer whose signature is on a Note no longer holds that office at the time the Trustee authenticates the Note, the Note shall be valid nevertheless.

 

A Note shall not be valid until an authorized officer of the Trustee manually authenticates the Note. The signature of the Trustee on a Note shall be conclusive evidence that such Note has been duly and validly authenticated and issued under this Indenture. A Note shall be dated the date of its authentication.

 

At any time and from time to time after the execution and delivery of this Indenture, the Trustee shall authenticate and make available for delivery: (1) Initial Notes for original issue on the Issue Date in an aggregate principal amount of $400,000,000, (2) subject to the terms of this Indenture, Additional Notes for original issue in an unlimited principal amount, in each case upon a written order of the Issuers signed by one Officer (the “Issuers Order”). Such Issuers Order shall specify whether the Notes will be in the form of Definitive Notes or Global Notes, the amount of the Notes to be authenticated, the date on which the original issue of Notes is to be authenticated, the holder of the Notes and whether the Notes are to be Initial Notes or Additional Notes.

 

The Trustee may appoint an agent (the “Authenticating Agent”) reasonably acceptable to the Issuers to authenticate the Notes. Any such appointment shall be evidenced by an instrument signed by a Trust Officer, a copy of which shall be furnished to the Issuers. Unless limited by the terms of such appointment, any such Authenticating Agent may authenticate Notes whenever the Trustee may do so. Each reference in this Indenture to authentication by the Trustee includes authentication by the Authenticating Agent. An Authenticating Agent has the same rights as any Registrar, Paying Agent or agent for service of notices and demands.

 

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In case the Issuers, pursuant to Article IV, shall be consolidated or merged with or into any other Person or shall convey, transfer, lease or otherwise dispose of its properties and assets substantially as an entirety to any Person, and the successor Person resulting from such consolidation, or surviving such merger, or into which the Issuers or any Guarantor shall have been merged, or the Person which shall have received a conveyance, transfer, lease or other disposition as aforesaid, shall have executed an indenture supplemental hereto with the Trustee pursuant to Article IV, any of the Notes authenticated or delivered prior to such consolidation, merger, conveyance, transfer, lease or other disposition may (but shall not be required), from time to time, at the request of the successor Person, be exchanged for other Notes executed in the name of the successor Person with such changes in phraseology and form as may be appropriate to reflect such successor Person, but otherwise in substance of like tenor as the Notes surrendered for such exchange and of like principal amount; and the Trustee, upon the Issuers Order of the successor Person, shall authenticate and make available for delivery Notes as specified in such order for the purpose of such exchange. If Notes shall at any time be authenticated and delivered in any new name of a successor Person pursuant to this Section 2.2 in exchange or substitution for or upon registration of transfer of any Notes, such successor Person, at the option of the Holders but without expense to them, shall provide for the exchange of all Notes at the time outstanding for Notes authenticated and delivered in such new name.

 

Section 2.3                                    Registrar and Paying Agent. The Issuers shall maintain an office or agency where Notes may be presented for registration of transfer or for exchange (the “Registrar”) and an office or agency where Notes may be presented for payment. The Registrar shall keep a register of the Notes and of their transfer and exchange (the “Notes Register”). The Issuers may have one or more co-registrars and one or more additional paying agents. The term “Paying Agent” includes any additional paying agent and the term “Registrar” includes any co-registrar.

 

The Issuers shall enter into an appropriate agency agreement with any Registrar or Paying Agent not a party to this Indenture. The agreement shall implement the provisions of this Indenture that relate to such agent. The Issuers shall notify the Trustee in writing of the name and address of each such agent. If the Issuers fail to maintain a Registrar or Paying Agent, the Trustee shall act as such and shall be entitled to appropriate compensation therefor pursuant to Section 7.7. The Issuers or any Guarantor may act as Paying Agent, Registrar or Transfer Agent.

 

The Issuers initially appoints The Depository Trust Company (“DTC”) to act as Depositary with respect to the Global Notes. The Issuers initially appoints the Trustee as the Registrar and Paying Agent for the Notes and the Issuers may remove any Registrar or Paying Agent without prior notice to the Holders, but upon written notice to such Registrar or Paying Agent and to the Trustee; provided, however, that no such removal shall become effective until (i) acceptance of any appointment by a successor as evidenced by an appropriate agreement entered into by the Issuers and such successor Registrar or Paying Agent, as the case may be, and delivered to the Trustee and the passage of any waiting or notice periods required by DTC procedures or (ii) written notification to the Trustee that the Trustee shall serve as Registrar or Paying Agent until the appointment of a successor in accordance with clause (i) above. The Registrar or Paying Agent may resign at any time upon written notice to the Issuers and the Trustee.

 

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Section 2.4                                    Paying Agent to Hold Money in Trust. Prior to 10:00 a.m. New York City time, on each due date of the principal of, premium, if any, or interest on any Note is due and payable, the Issuers shall deposit with the Paying Agent a sum sufficient in immediately available funds to pay such principal, premium or interest when due. The Issuers shall require the Paying Agent (other than the Trustee) to agree in writing that such Paying Agent shall hold in trust for the benefit of Holders or the Trustee all money held by such Paying Agent for the payment of principal of, premium, if any, or interest on the Notes (whether such assets have been distributed to it by the Issuers or other obligors on the Notes), shall notify the Trustee in writing of any default by the Issuers or any Guarantor in making any such payment and shall during the continuance of any default by the Issuers (or any other obligor upon the Notes) in the making of any payment in respect of the Notes, upon the written request of the Trustee, forthwith deliver to the Trustee all sums held in trust by such Paying Agent for payment in respect of the Notes together with a full accounting thereof. If the Issuers or a Subsidiary of the Issuers acts as Paying Agent, it shall segregate the money held by it as Paying Agent and hold it as a separate trust fund. The Issuers at any time may require a Paying Agent (other than the Trustee) to pay all money held by it to the Trustee and to account for any funds or assets disbursed by such Paying Agent. Upon complying with this Section 2.4, the Paying Agent (if other than the Issuers or a Subsidiary of the Issuers) shall have no further liability for the money delivered to the Trustee. Upon any bankruptcy, reorganization or similar proceeding with respect to the Issuers, the Trustee shall serve as Paying Agent for the Notes.

 

Section 2.5                                    Holder Lists. The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders. If the Trustee is not the Registrar, the Issuers, on their own behalf and on behalf of each of the Guarantors, shall furnish or cause the Registrar to furnish to the Trustee, in writing at least five Business Days before each interest payment date and at such other times as the Trustee may request in writing, a list in such form and as of such date as the Trustee may reasonably require of the names and addresses of Holders.

 

Section 2.6                                    Transfer and Exchange.

 

(a)                                 A Holder may transfer a Note (or a beneficial interest therein) to another Person or exchange a Note (or a beneficial interest therein) for another Note or Notes of any authorized denomination by presenting to the Registrar a written request therefor stating the name of the proposed transferee or requesting such an exchange, accompanied by any certification, opinion or other document required by this Section 2.6. The Registrar will promptly register any transfer or exchange that meets the requirements of this Section 2.6 by noting the same in the Notes Register maintained by the Registrar for the purpose, and no transfer or exchange will be effective until it is registered in such Notes Register. The transfer or exchange of any Note (or a beneficial interest therein) may only be made in accordance with this Section 2.6 and Section 2.1(g) and 2.1 (h), as applicable, and, in the case of a Global Note (or a beneficial interest therein), the applicable rules and procedures of DTC, Euroclear and Clearstream. The Registrar shall refuse to register any requested transfer or exchange that does not comply with this paragraph.

 

(b)                                 Transfers of Rule 144A Notes and Institutional Accredited Investor Notes. The following provisions shall apply with respect to any proposed registration of transfer of a

 

33

 

Rule 144A Note or an Institutional Accredited Investor Note prior to the date that is one year after the later of the date of its original issue and the last date on which the Issuers or any Affiliate of the Issuers was the owner of such Notes (or any predecessor thereto) (the “Resale Restriction Termination Date”):

 

(i)                                     a registration of transfer of a Rule 144A Note or an Institutional Accredited Investor Global Note or a beneficial interest therein to a QIB shall be made upon the representation of the transferee in the form as set forth on the reverse of the Note that it is purchasing for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Issuers as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A; provided that no such written representation or other written certification shall be required in connection with the transfer of a beneficial interest in the Rule 144A Global Note to a transferee in the form of a beneficial interest in that Rule 144A Global Note in accordance with this Indenture and the applicable procedures of DTC.

 

(ii)                                  a registration of transfer of a Rule 144A Note or an Institutional Accredited Investor Global Note or a beneficial interest therein to an IAI or an AI shall be made upon receipt by the Registrar or its agent of a certificate substantially in the form set forth in Section 2.8 or Section 2.10, respectively, from the proposed transferee and the delivery of an Opinion of Counsel, certification and/or other information satisfactory to it; and

 

(iii)                               a registration of transfer of a Rule 144A Note or an Institutional Accredited Investor Note or a beneficial interest therein to a Non-U.S. Person shall be made upon receipt by the Registrar or its agent of a certificate substantially in the form set forth in Section 2.9 from the proposed transferee and the delivery of an Opinion of Counsel, certification and/or other information satisfactory to it.

 

(c)                                  Transfers of Regulation S Notes. The following provisions shall apply with respect to any proposed transfer of a Regulation S Note:

 

(i)                                     a transfer of a Regulation S Note or a beneficial interest therein to a QIB shall be made upon the representation of the transferee, in the form of assignment on the reverse of the certificate, that it is purchasing the Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A, is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Issuers as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;

 

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(ii)                                  a transfer of a Regulation S Note or a beneficial interest therein to an IAI or an AI shall be made upon receipt by the Registrar or its agent of a certificate substantially in the form set forth in Section 2.8 or Section 2.10, respectively, from the proposed transferee and the delivery of an Opinion of Counsel, certification and/or other information satisfactory to the Issuers; and

 

(iii)                               a transfer of a Regulation S Note or a beneficial interest therein to a Non-U.S. Person shall be made upon receipt by the Registrar or its agent of a certificate substantially in the form set forth in Section 2.9 hereof from the proposed transferee and receipt by the Registrar or its agent of an Opinion of Counsel, certification and/or other information satisfactory to the Issuers.

 

(d)                                 Restricted Notes Legend. Upon the transfer, exchange or replacement of Notes not bearing a Restricted Notes Legend, the Registrar shall deliver Notes that do not bear a Restricted Notes Legend. Upon the transfer, exchange or replacement of Notes bearing a Restricted Notes Legend, the Registrar shall deliver only Notes that bear a Restricted Notes Legend unless (1) an Initial Note is being transferred pursuant to an effective registration statement, (2) Initial Notes are being exchanged for Notes that do not bear the Restricted Notes Legend in accordance with Section 2.6(e) or (3) there is delivered to the Registrar an Opinion of Counsel reasonably satisfactory to the Issuers and the Registrar stating that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act. Any Additional Notes sold in a registered offering shall not be required to bear the Restricted Notes Legend.

 

(e)                                  [Reserved]

 

(f)                                   Retention of Written Communications. The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.1 or this Section 2.6. The Issuers shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable prior written notice to the Registrar.

 

(g)                                  Obligations with Respect to Transfers and Exchanges of Notes. To permit registrations of transfers and exchanges, the Issuers shall, subject to the other terms and conditions of this Article II, execute and the Trustee shall authenticate Definitive Notes and Global Notes at the Issuers’ and Registrar’s written request.

 

No service charge shall be made to a Holder for any registration of transfer or exchange, but the Issuers may require the Holder to pay a sum sufficient to cover any transfer tax assessments or similar governmental charge payable in connection therewith (other than any such transfer taxes, assessments or similar governmental charges payable upon exchange or transfer pursuant to Sections 2.2, 2.6, 2.11, 2.13, 5.6 or 9.5).

 

The Issuers (and the Registrar) shall not be required to register the transfer of or exchange of any Note (A) for a period beginning (1) 15 calendar days before the mailing of a notice of an offer to repurchase or redeem Notes and ending at the close of business on the day of such mailing or (2) 15 calendar days before an interest payment date and ending on such

 

35

 

interest payment date or (B) called for redemption, except the unredeemed portion of any Note being redeemed in part.

 

Prior to the due presentation for registration of transfer of any Note, the Issuers, the Trustee, the Paying Agent or the Registrar may deem and treat the person in whose name a Note is registered as the owner of such Note for the purpose of receiving payment of principal of, premium, if any, and (subject to paragraph 2 of the forms of Notes attached hereto as Exhibits A, B and C) interest on such Note and for all other purposes whatsoever, including without limitation the transfer or exchange of such Note, whether or not such Note is overdue, and none of the Issuers, the Trustee, the Paying Agent or the Registrar shall be affected by notice to the contrary.

 

Any Definitive Note delivered in exchange for an interest in a Global Note pursuant to Section 2.1(h) shall, except as otherwise provided by Section 2.6(d), bear the applicable legend regarding transfer restrictions applicable to the Definitive Note set forth in Section 2.1(d).

 

All Notes issued upon any transfer or exchange pursuant to the terms of this Indenture shall evidence the same debt and shall be entitled to the same benefits under this Indenture as the Notes surrendered upon such transfer or exchange.

 

(h)           No Obligation of the Trustee. The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Note, a member of, or a participant in, DTC or other Person with respect to the accuracy of the records of DTC or its nominee or of any participant or member thereof, with respect to any ownership interest in the Notes or with respect to the delivery to any participant, member, beneficial owner or other Person (other than DTC) of any notice (including any notice of redemption or purchase) or the payment of any amount or delivery of any Notes (or other security or property) under or with respect to such Notes. All notices and communications to be given to the Holders and all payments to be made to Holders in respect of the Notes shall be given or made only to or upon the order of the registered Holders (which shall be DTC or its nominee in the case of a Global Note). The rights of beneficial owners in any Global Note shall be exercised only through DTC subject to the applicable rules and procedures of DTC. The Trustee may rely and shall be fully protected in relying upon information furnished by DTC with respect to its members, participants and any beneficial owners.

 

The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including any transfers between or among DTC participants, members or beneficial owners in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof. Neither the Trustee nor any of its agents shall have any responsibility for any actions taken or not taken by DTC.

 

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Section 2.7            [Reserved]

 

Section 2.8            Form of Certificate to be Delivered in Connection with Transfers to IAIs.

 

[Date]

 

Ladder Capital Finance Holdings LLLP
 Ladder Capital Finance Corporation
 345 Park Avenue, 8th Floor
 New York, New York 10154
 Attention: Marc Fox and Kelly Porcella
 Facsimile: (212) 715-3199

 

Wilmington Trust, National Association Global Capital Markets
 50 South Sixth Street, Suite 1290
 Minneapolis, MN 55402-1544
 Attention: Ladder Capital Administrator 
 Facsimile: (612) 217-5651

 

Re:                             Ladder Capital Finance Holdings LLLP and
 Ladder Capital Finance Corporation (the “Issuers”)

 

Ladies and Gentlemen:

 

This certificate is delivered to request a transfer of $[   ] principal amount of the 5.250% Senior Notes due 2025 (the “Notes”) of Ladder Capital Finance Holdings LLLP and Ladder Capital Finance Corporation (the “Issuers”).

 

Upon transfer, the Notes would be registered in the name of the new beneficial owner as follows:

 

	
Name:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Taxpayer ID Number:
    	
 
    	
 
    
					

 

The undersigned represents and warrants to you that:

 

1.              We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act of 1933, as amended (the “Securities Act”)) purchasing for our own account or for the account of such an institutional “accredited investor” of at least $250,000 principal amount of the Notes, and we are acquiring the Notes not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act. We have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risk of our investment in the Notes and we invest in or purchase securities similar to the Notes in the normal

 

37

 

course of our business. We and any accounts for which we are acting are each able to bear the economic risk of our or its investment.

 

2.              We understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold except as permitted in the following sentence. We agree on our own behalf and on behalf of any investor account for which we are purchasing Notes to offer, sell or otherwise transfer such Notes prior to the date that is one year after the later of the date of original issue and the last date on which the Issuers or any affiliate of the Issuers was the owner of such Notes (or any predecessor thereto) (the “Resale Restriction Termination Date”) only (a) to the Issuers or any Subsidiary thereof, (b) pursuant to an effective registration statement under the Securities Act, (c) in a transaction complying with the requirements of Rule 144A under the Securities Act, to a person we reasonably believe is a “qualified institutional buyer” under Rule 144A of the Securities Act (a “QIB”) that is purchasing for its own account or for the account of a QIB and to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales to non-U.S. persons that occur outside the United States within the meaning of Regulation S under the Securities Act, (e) to an institutional “accredited investor” within the meaning of Rule 501(a) (1), (2), (3) or (7) under the Securities Act that is purchasing for its own account or for the account of such an institutional “accredited investor,” in each case in a minimum principal amount of Notes of $250,000 for investment purposes and not with a view to or for offer or sale in connection with any distribution in violation of the Securities Act or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of our property or the property of such investor account or accounts be at all times within our or their control and in compliance with any applicable state securities laws. The foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date. If any resale or other transfer of the Notes is proposed to be made pursuant to clause (e) above prior to the Resale Restriction Termination Date, the transferor shall deliver a letter from the transferee substantially in the form of this letter to the Issuers and the Trustee, which shall provide, among other things, that the transferee is an institutional “accredited investor” (within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act) and that it is acquiring such Notes for investment purposes and not for distribution in violation of the Securities Act. Each purchaser acknowledges that the Issuers and the Trustee reserve the right prior to any offer, sale or other transfer prior to the Resale Termination Date of the Notes pursuant to clauses (d), (e) or (f) above to require the delivery of an opinion of counsel, certifications and/or other information satisfactory to the Issuers.

 

3.              We [are][are not] an Affiliate of the Issuers.

 

	
 
    	
TRANSFEREE:
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
BY:
    	
 
    
				

 

38

 

Section 2.9            Form of Certificate to be Delivered in Connection with Transfers Pursuant to Regulation S.

 

[Date]

 

Ladder Capital Finance Holdings LLLP
 Ladder Capital Finance Corporation
 345 Park Avenue, 8th Floor
 New York, New York 10154
 Attention: Marc Fox and Kelly Porcella
 Facsimile: (212) 715-3199

 

Wilmington Trust, National Association
 Global Capital Markets
 50 South Sixth Street, Suite 1290
 Minneapolis, MN 55402-1544
 Attention: Ladder Capital Administrator
 Facsimile: (612) 217-5651

 

Re:          Ladder Capital Finance Holdings LLLP and
 Ladder Capital Finance Corporation (the “Issuers”)

 

5.250% Senior Notes due 2025 (the “Notes”)

 

Ladies and Gentlemen:

 

In connection with our proposed sale of $[    ] aggregate principal amount of the Notes, we confirm that such sale has been effected pursuant to and in accordance with Regulation S under the United States Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, we represent that:

 

(a)           the offer of the Notes was not made to a person in the United States;

 

(b)           either (i) at the time the buy order was originated, the transferee was outside the United States or we and any person acting on our behalf reasonably believed that the transferee was outside the United States or (ii) the transaction was executed in, on or through the facilities of a designated off-shore securities market and neither we nor any person acting on our behalf knows that the transaction has been pre-arranged with a buyer in the United States;

 

(c)           no directed selling efforts have been made in the United States in contravention of the requirements of Rule 903(a)(2) or Rule 904(a)(2) of Regulation S, as applicable; and

 

(d)           the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act.

 

In addition, if the sale is made during a restricted period and the provisions of Rule 903(b)(2), Rule 903(b)(3) or Rule 904(b)(1) of Regulation S are applicable thereto, we confirm

 

39

 

that such sale has been made in accordance with the applicable provisions of Rule 903(b)(2), Rule 903(b)(3) or Rule 904(b)(1), as the case may be.

 

We also hereby certify that we [are][are not] an Affiliate of the Issuers and, to our knowledge, the transferee of the Notes [is][is not] an Affiliate of the Issuers.

 

The Trustee and the Issuers are entitled to conclusively rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby. Terms used in this certificate have the meanings set forth in Regulation S.

 

	
 
    	
 
    	
Very truly yours,
    
	
 
    	
 
    	
 
    
	
 
    	
[Name of Transferor]
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Authorized Signature
    
						

 

Section 2.10          Form of Certificate to be Delivered in Connection with Transfers to AIs.

 

[Date]

 

Ladder Capital Finance Holdings LLLP
 Ladder Capital Finance Corporation
 345 Park Avenue, 8th Floor
 New York, New York 10154
 Attention: Marc Fox and Kelly Porcella
 Facsimile: (212) 715-3199

 

Wilmington Trust, National Association
 Global Capital Markets
 50 South Sixth Street, Suite 1290
 Minneapolis, MN 55402-1544
 Attention: Ladder Capital Administrator
 Facsimile: (612) 217-5651

 

Re:          Ladder Capital Finance Holdings LLLP and
 Ladder Capital Finance Corporation (the “Issuers”)

 

Ladies and Gentlemen:

 

This certificate is delivered to request a transfer of $[  ] principal amount of the 5.250% Senior Notes due 2025 (the “Notes”) of Ladder Capital Finance Holdings LLLP and Ladder Capital Finance Corporation (the “Issuers”).

 

Upon transfer, the Notes would be registered in the name of the new beneficial owner as follows:

 

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Name:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Address:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Taxpayer ID Number:
    	
 
    	
 
    
					

 

The undersigned represents and warrants to you that:

 

4.              I am an “accredited investor” (as defined in Rule 501(a)(4) under the U.S. Securities Act of 1933, as amended (the “Securities Act”)) and I am acquiring the Notes not with a view to, or for offer or sale in connection with, any distribution in violation of the Securities Act. I have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risk of my investment in the Notes and I invest in or purchase securities similar to the Notes in the normal course of my business. I am able to bear the economic risk of my investment.

 

5.              I understand that the Notes have not been registered under the Securities Act and, unless so registered, may not be sold except as permitted in the following sentence. I agree on my own behalf to offer, sell or otherwise transfer such Notes prior to the date that is one year after the later of the date of original issue and the last date on which the Issuers or any affiliate of the Issuers was the owner of such Notes (or any predecessor thereto) (the “Resale Restriction Termination Date”) only (a) to the Issuers or any Subsidiary thereof, (b) pursuant to an effective registration statement under the Securities Act, (c) in a transaction complying with the requirements of Rule 144A under the Securities Act, to a person I reasonably believe is a “qualified institutional buyer” under Rule 144A of the Securities Act (a “QIB”) that is purchasing for its own account or for the account of a QIB and to whom notice is given that the transfer is being made in reliance on Rule 144A, (d) pursuant to offers and sales to non-U.S. persons that occur outside the United States within the meaning of Regulation S under the Securities Act, (e) to an institutional “accredited investor” within the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act that is purchasing for its own account or for the account of such an institutional “accredited investor,” in each case in a minimum principal amount of Notes of $200,000 for investment purposes and not with a view to or for offer or sale in connection with any distribution in violation of the Securities Act or (f) pursuant to any other available exemption from the registration requirements of the Securities Act, subject in each of the foregoing cases to any requirement of law that the disposition of my property be at all times within my control and in compliance with any applicable state securities laws. The foregoing restrictions on resale will not apply subsequent to the Resale Restriction Termination Date. Each purchaser acknowledges that the Issuers and the Trustee reserve the right prior to any offer, sale or other transfer prior to the Resale Termination Date of the Notes pursuant to clauses (d), (e) or (f) above to require the delivery of an opinion of counsel, certifications and/or other information satisfactory to the Issuers.

 

6.              I understand and acknowledge that upon the issuance thereof, and until such time as the same is no longer required under applicable requirements of the Securities Act or

 

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state securities laws, the Notes that I acquire will be certificated Notes that will bear, and all certificates issued in exchange therefor or in substitution thereof will bear, a restrictive legend set forth in Section 2.1(d) of the Indenture.

 

7.              I [am][am not] an Affiliate of the Issuers.

 

	
 
    	
TRANSFEREE:
    	
 
    
	
 
    	
BY:
    	
 
    
				

 

Section 2.11          Mutilated, Destroyed, Lost or Stolen Notes.

 

If a mutilated Note is surrendered to the Registrar or if the Holder of a Note claims that the Note has been lost, destroyed or wrongfully taken, the Issuers shall issue and the Trustee shall authenticate a replacement Note if the requirements of Section 8-405 of the Uniform Commercial Code are met, such that the Holder (a) satisfies the Issuers and the Trustee that such Note has been lost, destroyed or wrongfully taken within a reasonable time after such Holder has notice of such loss, destruction or wrongful taking and the Registrar has not registered a transfer prior to receiving such notification, (b) makes such request to the Issuers and the Trustee prior to the Note being acquired by a protected purchaser as defined in Section 8-303 of the Uniform Commercial Code (a “protected purchaser”) and (c) satisfies any other reasonable requirements of the Trustee; provided, however, if after the delivery of such replacement Note, a protected purchaser of the Note for which such replacement Note was issued presents for payment or registration such replaced Note, the Trustee and/or the Issuers shall be entitled to recover such replacement Note from the Person to whom it was issued and delivered or any Person taking therefrom, except a protected purchaser, and shall be entitled to recover upon the security or indemnity provided therefor to the extent of any loss, damage, cost or expense incurred by the Issuers or the Trustee in connection therewith. Such Holder shall furnish an indemnity bond sufficient in the judgment of the (i) Trustee to protect the Trustee and (ii) the Issuers to protect the Issuers, the Trustee, the Paying Agent and the Registrar, from any loss which any of them may suffer if a Note is replaced, and, in the absence of notice to the Issuers, any Guarantor or the Trustee that such Note has been acquired by a protected purchaser, the Issuers shall execute, and upon receipt of an Issuers Order, the Trustee shall authenticate and make available for delivery, in exchange for any such mutilated Note or in lieu of any such destroyed, lost or stolen Note, a new Note of like tenor and principal amount, bearing a number not contemporaneously outstanding.

 

In case any such mutilated, destroyed, lost or stolen Note has become or is about to become due and payable, the Issuers in its discretion may, instead of issuing a new Note, pay such Note.

 

Upon the issuance of any new Note under this Section 2.11, the Issuers may require that such Holder pay a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of counsel and of the Trustee) in connection therewith.

 

Subject to the proviso in the initial paragraph of this Section 2.11, every new Note issued pursuant to this Section 2.11, in lieu of any mutilated, destroyed, lost or stolen Note shall

 

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constitute an original additional contractual obligation of the Issuers, any Guarantor (if applicable) and any other obligor upon the Notes, whether or not the mutilated, destroyed, lost or stolen Note shall be at any time enforceable by anyone, and shall be entitled to all benefits of this Indenture equally and proportionately with any and all other Notes duly issued hereunder.

 

The provisions of this Section 2.11 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of mutilated, destroyed, lost or stolen Notes.

 

Section 2.12          Outstanding Notes. Notes outstanding at any time are all Notes authenticated by the Trustee except for those cancelled by it, those delivered to it for cancellation, those paid pursuant to Section 2.11 and those described in this Section as not outstanding. A Note does not cease to be outstanding in the event the Issuers or an Affiliate of the Issuers holds the Note; provided, however, that (i) for purposes of determining which are outstanding for consent or voting purposes hereunder, the provisions of Section 12.6 shall apply and (ii) in determining whether the Trustee shall be protected in making a determination whether the Holders of the requisite principal amount of outstanding Notes are present at a meeting of Holders of Notes for quorum purposes or have consented to or voted in favor of any request, demand, authorization, direction, notice, consent, waiver, amendment or modification hereunder, or relying upon any such quorum, consent or vote, only Notes which a Trust Officer of the Trustee actually knows to be held by the Issuers or an Affiliate of the Issuers shall not be considered outstanding.

 

If a Note is replaced pursuant to Section 2.11 (other than a mutilated Note surrendered for replacement), it ceases to be outstanding unless the Trustee and the Issuers receive proof satisfactory to them that the replaced Note is held by a protected purchaser. A mutilated Note ceases to be outstanding upon surrender of such Note and replacement pursuant to Section 2.11.

 

If the Paying Agent segregates and holds in trust, in accordance with this Indenture, on a Redemption Date or maturity date, money sufficient to pay all principal, premium, if any, and accrued interest payable on that date with respect to the Notes (or portions thereof) to be redeemed or maturing, as the case may be, and the Paying Agent is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture, then on and after that date such Notes (or portions thereof) cease to be outstanding and interest on them ceases to accrue.

 

Section 2.13          Temporary Notes. In the event that Definitive Notes are to be issued under the terms of this Indenture, until such Definitive Notes are ready for delivery, the Issuers may prepare and the Trustee shall authenticate temporary Notes. Temporary Notes shall be substantially in the form, and shall carry all rights, of Definitive Notes but may have variations that the Issuers consider appropriate for temporary Notes. Without unreasonable delay, the Issuers shall prepare and the Trustee shall authenticate Definitive Notes. After the preparation of Definitive Notes, the temporary Notes shall be exchangeable for Definitive Notes upon surrender of the temporary Notes at any office or agency maintained by the Issuers for that purpose and such exchange shall be without charge to the Holder. Upon surrender for cancellation of any one or more temporary Notes, the Issuers shall execute, and the Trustee shall, upon receipt of an Issuers Order, authenticate and make available for delivery in exchange therefor, one or more

 

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Definitive Notes representing an equal principal amount of Notes. Until so exchanged, the Holder of temporary Notes shall in all respects be entitled to the same benefits under this Indenture as a Holder of Definitive Notes.

 

Section 2.14          Cancellation. The Issuers at any time may deliver Notes to the Trustee for cancellation. The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered to them for registration of transfer, exchange or payment. The Trustee and no one else shall cancel all Notes surrendered for registration of transfer, exchange, payment or cancellation and dispose of such Notes in accordance with its internal policies and customary procedures (subject to the record retention requirements of the Exchange Act and the Trustee). If the Issuers or any Guarantor acquires any of the Notes, such acquisition shall not operate as a redemption or satisfaction of the Indebtedness represented by such Notes unless and until the same are surrendered to the Trustee for cancellation pursuant to this Section 2.14. The Issuers may not issue new Notes to replace Notes it has paid or delivered to the Trustee for cancellation for any reason other than in connection with a transfer or exchange.

 

At such time as all beneficial interests in a Global Note have either been exchanged for Definitive Notes, transferred, redeemed, repurchased or canceled, such Global Note shall be returned by DTC to the Trustee for cancellation or retained and canceled by the Trustee. At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for Definitive Notes, transferred in exchange for an interest in another Global Note, redeemed, repurchased or canceled, the principal amount of Notes represented by such Global Note shall be reduced and an adjustment shall be made on the books and records of the Trustee (if it is then the Notes Custodian for such Global Note) with respect to such Global Note, by the Trustee or the Notes Custodian, to reflect such reduction.

 

Section 2.15          Payment of Interest; Defaulted Interest. Interest on any Note which is payable, and is punctually paid or duly provided for, on any interest payment date shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered at the close of business on the regular record date for such payment at the office or agency of the Issuers maintained for such purpose pursuant to Section 2.3.

 

Any interest on any Note which is payable, but is not paid when the same becomes due and payable and such nonpayment continues for a period of 30 days shall forthwith cease to be payable to the Holder on the regular record date, and such defaulted interest and (to the extent lawful) interest on such defaulted interest at the rate borne by the Notes (such defaulted interest and interest thereon herein collectively called “Defaulted Interest”) shall be paid by the Issuers, at their election in each case, as provided in clause (a) or (b) below:

 

(a)           The Issuers may elect to make payment of any Defaulted Interest to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on a Special Record Date (as defined below) for the payment of such Defaulted Interest, which shall be fixed in the following manner. The Issuers shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Note and the date (not less than 30 days after such notice) of the proposed payment (the “Special Interest Payment Date”), and at the same time the Issuers shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make

 

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arrangements satisfactory to the Trustee for such deposit prior to the date of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this Section 2.15(a). Thereupon the Issuers shall fix a record date (the “Special Record Date”) for the payment of such Defaulted Interest, which date shall be not more than 20 calendar days and not less than 15 calendar days prior to the Special Interest Payment Date and not less than 10 calendar days after the receipt by the Trustee of the notice of the proposed payment. The Issuers shall promptly notify the Trustee in writing of such Special Record Date, and in the name and at the expense of the Issuers, the Trustee shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor to be given in the manner provided for in Section 12.2, not less than 10 calendar days prior to such Special Record Date. Notice of the proposed payment of such Defaulted Interest and the Special Record Date and Special Interest Payment Date therefor having been so given, such Defaulted Interest shall be paid on the Special Interest Payment Date to the Persons in whose names the Notes (or their respective predecessor Notes) are registered at the close of business on such Special Record Date and shall no longer be payable pursuant to the provisions in Section 2.15(b).

 

(b)           The Issuers may make payment of any Defaulted Interest in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, if, after written notice given by the Issuers to the Trustee of the proposed payment pursuant to this Section 2.15(b), such manner of payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section 2.15, each Note delivered under this Indenture upon registration of, transfer of or in exchange for or in lieu of any other Note shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Note.

 

Section 2.16          CUSIP and ISIN Numbers. The Issuers in issuing the Notes may use “CUSIP” and “ISIN” numbers and, if so, the Trustee shall use “CUSIP” and “ISIN” numbers in notices of redemption or purchase as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Notes or as contained in any notice of a redemption or purchase and that reliance may be placed only on the other identification numbers printed on the Notes, and any such redemption or purchase shall not be affected by any defect in or omission of such CUSIP and ISIN numbers. The Issuers shall promptly notify the Trustee in writing of any change in the CUSIP and ISIN numbers.

 

Section 2.17          Joint and Several Liability. Except as otherwise expressly provided herein, from and after the Issue Date, the Issuers shall be jointly and severally liable for the performance of all obligations and covenants under this Indenture and the Notes.

 

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ARTICLE III

 

COVENANTS

 

Section 3.1            Payment of Notes. The Issuers shall promptly pay the principal of, premium, if any, and interest on the Notes on the dates and in the manner provided in the Notes and in this Indenture. Principal, premium, if any, and interest shall be considered paid on the date due if by 10:00 a.m. Eastern time on such date the Trustee or the Paying Agent holds in accordance with this Indenture money sufficient to pay all principal, premium, if any, and interest then due and the Trustee or the Paying Agent, as the case may be, is not prohibited from paying such money to the Holders on that date pursuant to the terms of this Indenture.

 

The Issuers shall pay interest on overdue principal at the rate specified therefor in the Notes, and it shall pay interest on overdue installments of interest at the same rate to the extent lawful.

 

Notwithstanding anything to the contrary contained in this Indenture, the Issuers may, to the extent it is required to do so by law, deduct or withhold income or other similar taxes imposed by the United States of America from principal or interest payments hereunder.

 

Section 3.2            Limitation on Indebtedness.

 

(a)           The Company shall not, and shall not permit any of its Restricted Subsidiaries to, Incur any Indebtedness (including Acquired Indebtedness); provided, however, that the Company and any of its Restricted Subsidiaries may Incur Non-Funding Indebtedness, if on the date of such Incurrence and after giving pro forma effect thereto (including pro forma application of the proceeds thereof), (i) the Consolidated Non-Funding Debt to Equity Ratio of the Company and its Restricted Subsidiaries is not greater than 1.75 to 1.00 and (ii) the Company would have been in compliance with the covenant set forth in Section 3.3 as of the last day of the most recent fiscal quarter for which financial statements of the Company are available.

 

(b)           Section 3.2(a) will not prohibit the Incurrence of the following Indebtedness (collectively, “Permitted Debt”):

 

(i)            Indebtedness Incurred pursuant to any Credit Facility (including letters of credit or bankers’ acceptances issued or created under any Credit Facility), and any Refinancing Indebtedness in respect thereof and Guarantees in respect of such Indebtedness in a maximum aggregate principal amount at any time outstanding not exceeding (i) the greater of $225.0 million or 4.0% of Total Assets, plus (ii) in the case of any refinancing of any Indebtedness permitted under this clause or any portion thereof, the aggregate amount of fees, underwriting discounts, premiums and other costs and expenses Incurred in connection with such refinancing;

 

(ii)           Guarantees by the Company or any Restricted Subsidiary of Indebtedness of the Company or any Restricted Subsidiary so long as the Incurrence of such Indebtedness is not prohibited by the terms of this Indenture;

 

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(iii)          Indebtedness of the Company owing to and held by any Restricted Subsidiary or Indebtedness of a Restricted Subsidiary owing to and held by the Company or any Restricted Subsidiary; provided, however, that:

 

(1)           any subsequent issuance or transfer of Capital Stock or any other event which results in any such Indebtedness being beneficially held by a Person other than the Company or a Restricted Subsidiary of the Company; and

 

(2)           any sale or other transfer of any such Indebtedness to a Person other than the Company or a Restricted Subsidiary of the Company,

 

shall be deemed, in each case, to constitute an Incurrence of such Indebtedness by the Company or such Restricted Subsidiary, as the case may be;

 

(iv)          Indebtedness represented by (i) the Notes (other than any Additional Notes), including any Guarantee thereof, (ii) any Indebtedness (other than Indebtedness incurred pursuant to Section 3.2(b)(i) and (iii)) outstanding on the Issue Date, (iii) Refinancing Indebtedness (including, in the case of the Notes (other than any Additional Notes)) and any Guarantee thereof Incurred in respect of any Indebtedness described in this clause or clauses (v), (vi), (vii), (ix) or (xiv) of this Section 3.2(b) or Incurred pursuant to Section 3.2(a), and (iv) Management Advances;

 

(v)           Indebtedness of (x) the Company or any Restricted Subsidiary Incurred or issued to finance an acquisition or (y) Persons that are acquired by the Company or any Restricted Subsidiary or merged into or consolidated with the Company or a Restricted Subsidiary in accordance with the terms of this Indenture; provided that after giving effect to such acquisition, merger or consolidation, either

 

(1)           the Company would be permitted to Incur at least $1.00 of additional Indebtedness pursuant to the Consolidated Non-Funding Debt to Equity Ratio test set forth in Section 3.2(a);

 

(2)           the Consolidated Non-Funding Debt to Equity Ratio of the Company and its Restricted Subsidiaries would not be greater than immediately prior to such acquisition, merger or consolidation; or

 

(3)           such Indebtedness constitutes Acquired Indebtedness (other than Indebtedness Incurred in contemplation of the transaction or series of related transactions pursuant to which such Person became a Restricted Subsidiary or was otherwise acquired by the Company or a Restricted Subsidiary); provided that the only obligors with respect to such Indebtedness shall be those Persons who were obligors of such Indebtedness prior to such acquisition, merger or consolidation;

 

(vi)          Hedging Obligations (excluding Hedging Obligations entered into for speculative purposes);

 

(vii)         Indebtedness represented by Capitalized Lease Obligations or Purchase Money Obligations in an aggregate outstanding principal amount which, when

 

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taken together with the principal amount of all other Indebtedness Incurred pursuant to this clause and then outstanding and any Refinancing Indebtedness in respect thereof, does not exceed the greater of (i) $55.0 million and (ii) 1.0% of Total Assets at the time of Incurrence;

 

(viii)        Indebtedness in respect of (i) workers’ compensation claims, self-insurance obligations, performance, indemnity, surety, judgment, appeal, advance payment, customs, value added or other tax or other guarantees or other similar bonds, instruments or obligations and completion guarantees and warranties provided by the Company or a Restricted Subsidiary or relating to liabilities, obligations or guarantees Incurred in the ordinary course of business or consistent with past practice, (ii) the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business or consistent with past practice; provided, however, that such Indebtedness is extinguished within five Business Days of Incurrence; (iii) customer deposits and advance payments received in the ordinary course of business or consistent with past practice from customers for goods or services purchased in the ordinary course of business or consistent with past practice; (iv) letters of credit, bankers’ acceptances, guarantees or other similar instruments or obligations issued or relating to liabilities or obligations Incurred in the ordinary course of business or consistent with past practice, and (v) any customary treasury, depositary, cash management, automatic clearinghouse arrangements, overdraft protections, cash pooling or netting or setting off arrangements in the ordinary course of business or consistent with past practice;

 

(ix)          Indebtedness arising from agreements providing for guarantees, indemnification, obligations in respect of earn-outs or other adjustments of purchase price, in each case, or similar obligations, in each case, Incurred or assumed in connection with the acquisition or disposition of any business or assets or Person or any Capital Stock of a Subsidiary;

 

(x)           Indebtedness consisting of promissory notes issued by the Company or any of its Subsidiaries to any current or former employee, director or consultant of the Company, any of its Subsidiaries or any of its Parents (or permitted transferees, assigns, estates, or heirs of such employee, director or consultant), to finance the purchase or redemption of Capital Stock of the Company or any of its Parents;

 

(xi)          Indebtedness of the Company or any of its Restricted Subsidiaries consisting of (i) the financing of insurance premiums or (ii) take-or-pay obligations contained in supply arrangements, in each case Incurred in the ordinary course of business or consistent with past practice;

 

(xii)         Permitted Funding Indebtedness;

 

(xiii)        Permitted Securitization Indebtedness and Indebtedness under Credit Enhancement Agreements or arising out of or to fund purchases of all remaining outstanding asset-backed securities of any Securitization Entity for the purpose of

 

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relieving the Company or a Subsidiary of the Company of the administrative expense of servicing such Securitization Entity; and

 

(xiv)        Indebtedness in an aggregate outstanding principal amount which, when taken together with any Refinancing Indebtedness in respect thereof and the principal amount of all other Indebtedness Incurred pursuant to this clause and then outstanding, will not exceed the greater of (a) $165.0 million and (b) 3.0% of Total Assets.

 

(c)           For purposes of determining compliance with, and the outstanding principal amount of any particular Indebtedness Incurred pursuant to and in compliance with, this Section 3.2:

 

(i)            in the event that all or any portion of any item of Indebtedness meets the criteria of more than one of the types of Indebtedness described in Section 3.2(a) and (b), the Company, in its sole discretion, will classify, and may from time to time reclassify, such Indebtedness and only be required to include the amount and type of such Indebtedness in one of the clauses of Section 3.2(a) or (b);

 

(ii)           additionally, all or any portion of any item of Indebtedness may later be reclassified as having been Incurred pursuant to any type of Indebtedness described in Section 3.2(a) and (b) so long as such Indebtedness is permitted to be Incurred pursuant to such provision;

 

(iii)          Guarantees of, or obligations in respect of letters of credit, bankers’ acceptances or other similar instruments relating to, or Liens securing, Indebtedness that is otherwise included in the determination of a particular amount of Indebtedness shall not be included;

 

(iv)          if obligations in respect of letters of credit, bankers’ acceptances or other similar instruments are Incurred pursuant to any Credit Facility and are being treated as Incurred pursuant to clauses (i) or (vii) of Section 3.2(b) or Section 3.2(a) and the letters of credit, bankers’ acceptances or other similar instruments relate to other Indebtedness, then such other Indebtedness shall not be included;

 

(v)           the principal amount of any Disqualified Stock of the Company or a Restricted Subsidiary, or Preferred Stock of a Restricted Subsidiary, will be equal to the greater of the maximum mandatory redemption or repurchase price (not including, in either case, any redemption or repurchase premium) or the liquidation preference thereof;

 

(vi)          Indebtedness permitted by this Section 3.2 need not be permitted solely by reference to one provision permitting such Indebtedness but may be permitted in part by one such provision and in part by one or more other provisions of this Section 3.2 permitting such Indebtedness; and

 

(vii)         the amount of Indebtedness issued at a price that is less than the principal amount thereof will be equal to the amount of the liability in respect thereof determined on the basis of GAAP.

 

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(d)           Accrual of interest, accrual of dividends, the accretion of accreted value, the accretion or amortization of original issue discount, the payment of interest in the form of additional Indebtedness, the payment of dividends in the form of additional shares of Preferred Stock or Disqualified Stock or the reclassification of commitments or obligations not treated as Indebtedness due to a change in GAAP, will not be deemed to be an Incurrence of Indebtedness for purposes of this Section 3.2. The amount of any Indebtedness outstanding as of any date shall be (a) the accreted value thereof in the case of any Indebtedness issued with original issue discount and (b) the principal amount of the Indebtedness, or liquidation preference thereof, in the case of any other Indebtedness.

 

(e)           If at any time an Unrestricted Subsidiary becomes a Restricted Subsidiary, any Indebtedness of such Subsidiary shall be deemed to be Incurred by a Restricted Subsidiary of the Company as of such date (and, if such Indebtedness is not permitted to be Incurred as of such date under this Section 3.2, the Company shall be in default of this Section 3.2).

 

(f)            Notwithstanding any other provision of this Section 3.2, the maximum amount of Indebtedness that the Company or a Restricted Subsidiary may Incur pursuant to this Section 3.2 shall not be deemed to be exceeded solely as a result of fluctuations in the exchange rate of currencies. The principal amount of any Indebtedness Incurred to refinance other Indebtedness, if Incurred in a different currency from the Indebtedness being refinanced, shall be calculated based on the currency exchange rate applicable to the currencies in which such Refinancing Indebtedness is denominated that is in effect on the date of such refinancing.

 

(g)           The Company shall not, and shall not permit any Guarantor to, directly or indirectly, Incur any Indebtedness (including Acquired Indebtedness) that is subordinated or junior in right of payment to any Indebtedness of the Company or such Guarantor, as the case may be, unless such Indebtedness is expressly subordinated in right of payment to the Notes or such Guarantor’s Guarantee to the extent and in the same manner as such Indebtedness is subordinated to other Indebtedness of the Company or such Guarantor, as the case may be.

 

(h)           Unsecured Indebtedness shall not be treated as subordinated or junior to secured Indebtedness merely because such Indebtedness is unsecured. Senior Indebtedness shall not be treated as subordinated or junior to any other senior Indebtedness merely because it has a junior priority with respect to the same collateral or is secured by different collateral.

 

Section 3.3            Maintenance of Total Unencumbered Assets. The Company will maintain Total Unencumbered Assets of not less than 120% of the aggregate outstanding principal amount of the Unsecured Indebtedness of the Company and its Restricted Subsidiaries, in each case determined on a consolidated basis in accordance with GAAP.

 

Section 3.4            Limitation on Guarantees.

 

(a)           The Company will not permit any of its Wholly Owned Domestic Subsidiaries that are Restricted Subsidiaries (and non-Wholly Owned Domestic Subsidiaries if such non-Wholly Owned Domestic Subsidiaries Guarantee other loan facilities or debt securities (other than Permitted Funding Indebtedness) of the Company or any Restricted Subsidiary), other than (i) a Co-Issuer or a Guarantor, (ii) an Excluded Restricted Subsidiary or (iii) a

 

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Securitization Entity, to Incur any Non-Funding Indebtedness (other than Preferred Stock) or Guarantee the payment of any loan facilities or debt securities of the Company or any other Guarantor that are Non-Funding Indebtedness, in each case, unless:

 

(i)            such Restricted Subsidiary within 60 days executes and delivers a supplemental indenture to this Indenture providing for a senior Guarantee by such Restricted Subsidiary; provided that (a) if such Indebtedness is by its express terms subordinated in right of payment to the Notes or such Guarantor’s Guarantee, any such Guarantee by such Restricted Subsidiary with respect to such Indebtedness shall be subordinated in right of payment to such Guarantee with respect to the Notes substantially to the same extent as such Indebtedness is subordinated to the Notes or such Guarantor’s Guarantee of the Notes; and (b) if the Notes or such Guarantor’s Guarantee are subordinated in right of payment to such Indebtedness, the Guarantee under the supplemental indenture shall be subordinated to such Restricted Subsidiary’s Guarantee with respect to such Indebtedness substantially to the same extent as the Notes or the Guarantor’s Guarantee are subordinated to such Indebtedness; and

 

(ii)           such Restricted Subsidiary waives and will not in any manner whatsoever claim or take the benefit or advantage of, any rights of reimbursement, indemnity or subrogation or any other rights against the Company or any other Restricted Subsidiary as a result of any payment by such Restricted Subsidiary under its Guarantee until payment in full of obligations under this Indenture;

 

provided that this Section 3.4 shall not be applicable to any guarantee of any Restricted Subsidiary that existed at the time such Person became a Restricted Subsidiary and was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary.

 

(b)           The Company may elect, in its sole discretion, to cause any Subsidiary that is not otherwise required to be a Guarantor to become a Guarantor, in which case, such Subsidiary shall only be required to comply with the 60-day period described in this Section 3.4.

 

(c)           Any Guarantee will be limited to the maximum amount that would not render the Guarantor’s obligations subject to avoidance under applicable fraudulent conveyance provisions of the United States Bankruptcy Code or any comparable provision of foreign or state law to comply with corporate benefit, financial assistance and other laws. By virtue of this limitation, a Guarantor’s obligation under its Guarantee could be significantly less than amounts payable with respect to the Notes, or a Guarantor may have effectively no obligation under its Guarantee.

 

(d)           The Guarantee of a Guarantor will terminate upon:

 

(i)            a sale or other disposition (including by way of consolidation or merger) of the Capital Stock of such Guarantor or the sale or disposition of all or substantially all the assets of the Guarantor (other than to the Company or a Restricted Subsidiary) otherwise permitted by this Indenture;

 

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(ii)           the designation in accordance with this Indenture of the Guarantor as an Unrestricted Subsidiary or the occurrence of any event after which the Guarantor is no longer a Restricted Subsidiary;

 

(iii)          defeasance or discharge of the Notes, as provided in Article VIII and XI;

 

(iv)          to the extent that such Guarantor is not an Immaterial Subsidiary solely due to the operation of clause (i) of the definition of “Immaterial Subsidiary,” upon the release of the Guarantee referred to in such clause;

 

(v)           such Guarantor being released from all of its obligations under all of its Guarantees of payment by the Company of any Non-Funding Indebtedness of the Company under all loan facilities and debt securities of the Company (it being understood that a release subject to reinstatement is considered a release); or

 

(vi)          upon the achievement of Investment Grade Status by the Notes; provided that such Guarantee shall be reinstated upon the Reversion Date.

 

(e)           Claims of creditors of non-guarantor Subsidiaries, including trade creditors, secured creditors and creditors holding debt and guarantees issued by those Subsidiaries, and claims of preferred and minority shareholders (if any) of those Subsidiaries and claims against Joint Ventures generally will have priority with respect to the assets and earnings of those Subsidiaries and Joint Ventures over the claims of creditors of the Company, including Holders of the Notes. The Notes and each Guarantee therefore will be structurally subordinated to creditors (including trade creditors) and preferred and minority shareholders (if any) of Subsidiaries of the Company (other than the Guarantors) and Joint Ventures.

 

Section 3.5            Change of Control.

 

(a)           If a Change of Control Repurchase Event occurs, unless the Issuers have previously or concurrently delivered a redemption notice with respect to all the outstanding Notes under Section 5.7, the Issuers shall make an offer to purchase all of the Notes (the “Change of Control Offer”) at a price in cash (the “Change of Control Payment”) equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to but excluding the date of repurchase, subject to the right of Holders of the Notes of record on the relevant record date to receive interest due on the relevant interest payment date. Within 30 days following any Change of Control Repurchase Event, the Issuers will deliver notice of such Change of Control Offer electronically or by first-class mail, with a copy to the Trustee, to each Holder of Notes at the address of such Holder appearing in the security register or otherwise in accordance with the applicable procedures of DTC, describing the transaction or transactions that constitute the Change of Control Repurchase Event and with the following information:

 

(i)            that a Change of Control Offer is being made pursuant to this Section 3.5, and that all Notes properly tendered pursuant to such Change of Control Offer will be accepted for payment by the Issuers;

 

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(ii)           the purchase price and the purchase date, which will be no earlier than 30 days nor later than 60 days from the date such notice is delivered (the “Change of Control Payment Date”);

 

(iii)          that any Note not properly tendered will remain outstanding and continue to accrue interest;

 

(iv)          that unless the Issuers default in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer will cease to accrue interest, on the Change of Control Payment Date;

 

(v)           that Holders electing to have any Notes purchased pursuant to a Change of Control Offer will be required to surrender such Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of such Notes completed, to the Paying Agent specified in the notice at the address specified in the notice prior to the close of business on the third Business Day preceding the Change of Control Payment Date;

 

(vi)          that Holders will be entitled to withdraw their tendered Notes and their election to require the Issuers to purchase such Notes; provided that the Paying Agent receives, not later than the close of business on the second Business Day prior to the expiration date of the Change of Control Offer, a telegram, facsimile transmission or letter setting forth the name of the Holder of the Notes, the principal amount of Notes tendered for purchase, and a statement that such Holder is withdrawing its tendered Notes and its election to have such Notes purchased;

 

(vii)         that Holders whose Notes are being purchased only in part will be issued new Notes and such new Notes will be equal in principal amount to the unpurchased portion of the Notes surrendered. The unpurchased portion of the Notes must be equal to at least $2,000 or any integral multiple of $1,000 in excess of $2,000;

 

(viii)        if such notice is delivered prior to the occurrence of a Change of Control, stating that the Change of Control Offer is conditional on the occurrence of such Change of Control; and

 

(ix)          the other instructions, as determined by the Issuers, consistent with this Section 3.5, that a Holder must follow.

 

The Paying Agent will promptly deliver to each Holder of the Notes tendered the Change of Control Payment for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book-entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note will be in a minimum principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. The Issuers will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

 

If the Change of Control Payment Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest, if any, will be paid on

 

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the relevant interest payment date to the Person in whose name a Note is registered at the close of business on such record date.

 

(b)           On the Change of Control Payment Date, the Issuers will, to the extent permitted by law,

 

(i)            accept for payment all Notes issued by it or portions thereof properly tendered pursuant to the Change of Control Offer,

 

(ii)           deposit with the Paying Agent an amount equal to the aggregate Change of Control Payment in respect of all Notes or portions thereof so tendered, and

 

(iii)          deliver, or cause to be delivered, to the Trustee for cancellation the Notes so accepted together with an Officer’s Certificate to the Trustee stating that such Notes or portions thereof have been tendered to and purchased by the Issuers.

 

(c)           The Issuers will not be required to make a Change of Control Offer following a Change of Control if (i) a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the Issuers and purchases all Notes validly tendered and not withdrawn under such Change of Control Offer or (ii) a notice of redemption of all outstanding Notes has been given pursuant to Section 5.3 unless and until there is a default in the payment of the redemption price on the applicable redemption date or the redemption is not consummated due to a failure of a condition precedent contained in the applicable redemption notice to be satisfied. Notwithstanding anything to the contrary in this Section 3.5, a Change of Control Offer may be made in advance of a Change of Control, conditional upon such Change of Control, if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.

 

(d)           If Holders of not less than 90% in aggregate principal amount of the outstanding Notes validly tender and do not withdraw such Notes in a Change of Control Offer and the Issuers, or any third party making a Change of Control Offer in lieu of the Issuers as described in this Section 3.5, purchases all of the Notes validly tendered and not withdrawn by such Holders, the Issuers or such third party will have the right, upon not less than 15 nor more than 60 days’ prior notice, given not more than 30 days following such purchase pursuant to the Change of Control Offer, to redeem all Notes that remain outstanding following such purchase at a price in cash equal to 101% of the principal amount thereof plus accrued and unpaid interest to but excluding the date of redemption.

 

(e)           The Issuers will comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of Notes pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Indenture, the Issuers will comply with the applicable securities laws and regulations and shall not be deemed to have breached their obligations described in this Indenture by virtue thereof. The Issuers may rely on any no-action letters issued by the SEC

 

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indicating that the staff of the SEC will not recommend enforcement action in the event a tender offer satisfies certain conditions.

 

Section 3.6            Reports.

 

(a)           Notwithstanding that the Issuers may not be subject to the reporting requirements of Section 13 or 15(d) of the Exchange Act or otherwise report on an annual and quarterly basis on forms provided for such annual and quarterly reporting pursuant to rules and regulations promulgated by the SEC, the Issuers shall furnish to the Trustee and the Holders of Notes within 15 days after the time periods specified below:

 

(i)            within 90 days (120 days in the case of the first fiscal year ending after the Issue Date) after the end of each fiscal year, annual reports of the Company containing substantially all of the financial information that would have been required to be contained in an annual report on Form 10-K or any successor or comparable form under the Exchange Act if the Company had been a reporting company under the Exchange Act (but only to the extent similar information is included in the Offering Memorandum), including (A) “Management’s discussion and analysis of financial condition and results of operations” and (B) audited financial statements prepared in accordance with GAAP;

 

(ii)           within 45 days (60 days in the case of the first fiscal quarter ending after the Issue Date) after the end of each of the first three fiscal quarters of each fiscal year, quarterly reports of the Company containing substantially all of the financial information that would have been required to be contained in a Quarterly Report on Form 10-Q or any successor or comparable form under the Exchange Act if the Company had been a reporting company under the Exchange Act (but only to the extent similar information is provided in the Offering Memorandum), including (A) “Management’s discussion and analysis of financial condition and results of operations” and (B) unaudited quarterly financial statements prepared in accordance with GAAP; and

 

(iii)          within the time periods specified for filing current reports on Form 8-K, after the occurrence of each event that would have been required to be reported in a Current Report on Form 8-K or any successor or comparable form under the Exchange Act, if the Company had been a reporting company under the Exchange Act, current reports containing substantially all of the information that would have been required to be contained in a Current Report on Form 8-K under the Exchange Act if the Company had been a reporting company under the Exchange Act; provided, that the foregoing shall not obligate the Issuers to make available (i) any information otherwise required to be included on a Form 8-K regarding the occurrence of any such events if the Issuers determine in their good faith judgment that such event that would otherwise be required to be disclosed is not material to the Holders of the Notes or the business, assets, operations, financial positions or prospects of the Company and its Restricted Subsidiaries, taken as a whole, or (ii) a summary of the terms of any employment or compensatory arrangement, agreement, plan or understanding between the Company (or any of its Subsidiaries) and any director, manager or executive officer of the Company (or any of its Subsidiaries);

 

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provided, however, that the Issuers shall not be required to (i) comply with Regulation G under the Exchange Act or Item 10(e) of Regulation S-K with respect to any “non-GAAP” financial information contained therein, (ii) provide any information that is not otherwise similar to information currently included in the Offering Memorandum or (iii) provide the type of information contemplated by Rule 3-10 of Regulation S-X with respect to separate financial statements for Guarantors or any financial statements for unconsolidated subsidiaries or 50% or less owned persons contemplated by Rule 3-09 of Regulation S-X or any schedules required by Regulation S-X, or in each case any successor provisions. In addition, notwithstanding the foregoing, the Issuers will not be required to (i) comply with Sections 302, 906 and 404 of the Sarbanes-Oxley Act of 2002, as amended, or (ii) otherwise furnish any information, certificates or reports required by Items 307 or 308 of Regulation S-K.

 

(b)           To the extent any such information is not so filed or furnished, as applicable, within the time periods specified above and such information is subsequently filed or furnished, as applicable, the Company will be deemed to have satisfied its obligations with respect thereto at such time and any Default with respect thereto shall be deemed to have been cured; provided that such cure shall not otherwise affect the rights of the Holders under Section 6.1 if Holders of at least 30% in principal amount of the then total outstanding Notes have declared the principal, premium, if any, interest and any other monetary obligations on all the then outstanding Notes to be due and payable immediately and such declaration shall not have been rescinded or cancelled prior to such cure.

 

(c)           So long as the Notes are outstanding and the reports described above are not filed with the SEC, the Company will use commercially reasonable efforts to maintain a website (that may be password protected) to which Holders of Notes, prospective investors, broker-dealers and securities analysts are given access promptly and to which all of the reports and press releases required by this Section 3.6 are posted. The Company will hold a conference call for the Holders and securities analysts to discuss such financial information no later than 15 calendar days after filing the annual financial information described in Section 3.6(a)(1) and after filing the quarterly financial information described in Section 3.6(a)(2). The Company will announce any such conference call at least three business days in advance and not more than ten business days after filing of the foregoing financial information.

 

(d)           To the extent not satisfied by the reports referred to in Section 3.6(a), the Company shall furnish to noteholders, prospective investors, broker-dealers and securities analysts, upon their request, any information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act so long as the notes are not freely transferable under the Securities Act.

 

(e)           Notwithstanding anything to the contrary in this Section 3.6, if the Company or any Parent has furnished the Trustee and the Holders of Notes or filed with the SEC the reports described in the preceding paragraphs with respect to the Company or any Parent, the Company shall be deemed to be in compliance with the provisions of this Section 3.6.  The Trustee will have no responsibility to determine whether such filing has occurred.

 

(f)            For the purposes of this Section 3.6, the delivery of any reports, information and documents to the Trustee is for informational purposes only and the Trustee’s

 

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receipt of such shall not constitute actual or constructive knowledge or notice of any information contained therein.

 

Section 3.7            Maintenance of Office or Agency.

 

The Issuers will maintain an office or agency where the Notes will be payable at the office or agency of the Issuers maintained for such purpose and where, if applicable, the Notes may be surrendered for registration of transfer or exchange and where notices and demands to or upon the Issuers in respect of the Notes and this Indenture may be delivered. The corporate trust office of the Trustee, which initially shall be located at Wilmington Trust, National Association, Global Capital Markets, 50 South Sixth Street, Suite 1290, Minneapolis, MN 55402-1544, Attention: Ladder Capital Administrator, shall be such office or agency of the Issuers unless the Issuers shall designate and maintain some other office or agency for one or more of such purposes. The Issuers will give prompt written notice to the Trustee of any change in the location of any such office or agency. If at any time the Issuers shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations and surrenders may be made or delivered to the corporate trust office of the Trustee, and the Issuers hereby appoint the Trustee as its agent to receive all such presentations and surrenders.

 

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

 

Section 3.8            [Reserved].

 

Section 3.9            [Reserved].

 

Section 3.10          [Reserved].

 

Section 3.11          Compliance Certificate. The Issuers shall deliver to the Trustee within 120 days after the end of each fiscal year of the Issuers an Officer’s Certificate, which shall be signed by the Chief Executive Officer, Chief Financial Officer, the Treasurer, the Secretary or the General Counsel of each of the Issuers, stating that in the course of the performance by the signer of his or her duties as an Officer of the Issuers he or she would normally have knowledge of any Default or Event of Default and whether or not the signer knows of any Default or Event of Default that occurred during the previous fiscal year; provided that no such Officer’s Certificate shall be required for any fiscal year ended prior to the Issue Date. If such Officer does have such knowledge, the certificate shall describe the Default or Event of Default, its status and the action the Issuers is taking or proposes to take with respect thereto.

 

Section 3.12          Further Instruments and Acts. Upon request of the Trustee or as necessary to comply with future developments or requirements, the Issuers will execute and deliver such further instruments and do such further acts as may be reasonably necessary or proper to carry out more effectively the purpose of this Indenture.

 

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Section 3.13          Statement by Officers as to Default. The Issuers shall deliver to the Trustee, as soon as possible and in any event within 30 days after the Issuers become aware of the occurrence of any Default or Event of Default, an Officer’s Certificate setting forth the details of such Event of Default or Default, its status and the actions which the Issuers are taking or proposes to take with respect thereto.

 

Section 3.14          Suspension of Certain Covenants.

 

(a)           Following the first day: (1) the Notes have achieved Investment Grade Status; and (2) no Default or Event of Default has occurred and is continuing under this Indenture, then, beginning on that day and continuing until the Reversion Date (as defined below), the Company and its Restricted Subsidiaries will not be subject to Sections 3.2, 3.3, 3.4 and 4.1(a)(3) (collectively, the “Suspended Covenants”).

 

(b)           If at any time the Notes cease to have such Investment Grade Status, then the Suspended Covenants will thereafter be reinstated as if such covenants had never been suspended (the “Reversion Date”) and be applicable pursuant to the terms of this Indenture (including in connection with performing any calculation or assessment to determine compliance with the terms of this Indenture), unless and until the Notes subsequently attain Investment Grade Status is in existence (in which event the Suspended Covenants shall no longer be in effect for such time that the Notes maintain an Investment Grade Status is in existence); provided, however, that no Default, Event of Default or breach of any kind shall be deemed to exist under this Indenture, the Notes or the Guarantees with respect to the Suspended Covenants based on, and none of the Company or any of its Subsidiaries shall bear any liability for, any actions taken or events occurring during the Suspension Period (as defined below), or any actions taken at any time pursuant to any contractual obligation arising prior to the Reversion Date, regardless of whether such actions or events would have been permitted if the applicable Suspended Covenants remained in effect during such period. The period of time between the date of suspension of the covenants and the Reversion Date is referred to as the “Suspension Period.”

 

(c)           On the Reversion Date, all Indebtedness Incurred during the Suspension Period will be classified to have been Incurred pursuant to Section 3.2(b)(iv)(ii). During the Suspension Period, any future obligation to grant further Guarantees shall be released. All such further obligation to grant Guarantees shall be reinstated upon the Reversion Date. On and after each Reversion Date, the Issuers and their Subsidiaries will be permitted to consummate the transactions contemplated by any contract entered into during the Suspension Period, so long as such contract and such consummation would have been permitted during such Suspension Period.

 

(d)           The Issuers shall send prompt written notice to the Trustee if the conditions in Section 3.14(a) are satisfied or if a Reversion Date occurs. The Trustee shall not be deemed to have knowledge of any suspension of covenants or Reversion Date unless a Trust Officer has received the notice referred to in this Section 3.14(d).

 

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Section 3.15          Designation of Restricted and Unrestricted Subsidiaries.

 

(a)           The Company may designate any Restricted Subsidiary to be an Unrestricted Subsidiary if that designation would not cause a Default and the Restricted Subsidiary otherwise meets the definition of an Unrestricted Subsidiary. The Company may redesignate any Unrestricted Subsidiary to be a Restricted Subsidiary if that redesignation would not cause a Default.

 

(b)           Any designation of a Subsidiary of the Company as an Unrestricted Subsidiary will be evidenced to the Trustee by filing with the Trustee an Officer’s Certificate certifying that such designation complies with the preceding conditions. If, at any time, any Unrestricted Subsidiary would fail to meet the preceding requirements as an Unrestricted Subsidiary, it will thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of such Subsidiary will be deemed to be incurred by a Restricted Subsidiary of the Company as of such date and, if such Indebtedness is not permitted to be incurred as of such date under Section 3.2, the Company will be in default of Section 3.2.

 

(c)           The Company may at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary of the Company; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of the Company of any outstanding Indebtedness of such Unrestricted Subsidiary, and such designation will only be permitted if (1) such Indebtedness is permitted under Section 3.2 calculated on a pro forma basis as if such designation had occurred at the beginning of the applicable reference period; and (2) no Default or Event of Default would be in existence following such designation. Any such designation by the Company shall be evidenced to the Trustee by filing with the Trustee an Officer’s Certificate certifying that such designation complies with the preceding conditions.

 

ARTICLE IV

 

SUCCESSOR ISSUERS; SUCCESSOR PERSON

 

Section 4.1            Merger and Consolidation.

 

(a)           The Company will not consolidate with or merge with or into, or convey, transfer or lease all or substantially all its assets to, any Person, unless:

 

(i)            the resulting, surviving or transferee Person (the “Successor Company”) will be a Person organized and existing under the laws of the United States of America, any State of the United States or the District of Columbia and the Successor Company (if not the Company) will expressly assume, by supplemental indenture, executed and delivered to the Trustee, all the obligations of the Company under the Notes and this Indenture and if such Successor Company is not a corporation, a co-obligor of the Notes is a corporation organized or existing under such laws;

 

(ii)           immediately after giving effect to such transaction (and treating any Indebtedness that becomes an obligation of the Successor Company or any Subsidiary of the Successor Company as a result of such transaction as having been

 

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Incurred by the Successor Company or such Subsidiary at the time of such transaction), no Default or Event of Default shall have occurred and be continuing;

 

(iii)          immediately after giving effect to such transaction, (x) either (i) the Successor Company would be able to Incur at least an additional $1.00 of Indebtedness pursuant to Section 3.2(a) or (ii) the Consolidated Non-Funding Debt to Equity Ratio of the Company and its Restricted Subsidiaries would not be greater than it was immediately prior to giving effect to such transaction and (y) the Company would have been in compliance with Section 3.3 as of the last day of the most recent fiscal quarter for which financial statements of the Company are available; and

 

(iv)          the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such consolidation, merger or transfer and such supplemental indenture (if any) comply with this Indenture and an Opinion of Counsel stating that such supplemental indenture (if any) is a legal and binding agreement enforceable against the Successor Company; provided that in giving an Opinion of Counsel, counsel may rely on an Officer’s Certificate as to any matters of fact, including as to satisfaction of Section 4.1(a)(2) and (3).

 

(b)           For purposes of this Section 4.1, the sale, lease, conveyance, assignment, transfer, or other disposition of all or substantially all of the properties and assets of one or more Subsidiaries of the Company, which properties and assets, if held by the Company instead of such Subsidiaries, would constitute all or substantially all of the properties and assets of the Company on a consolidated basis, shall be deemed to be the transfer of all or substantially all of the properties and assets of the Company.

 

(c)           The Successor Company will succeed to, and be substituted for, and may exercise every right and power of, the Company under this Indenture but in the case of a lease of all or substantially all its assets, the predecessor company will not be released from its obligations under this Indenture or the Notes.

 

(d)           Notwithstanding Section 4.1(a)(2), (a)(3) and (a)(4) (which do not apply to transactions referred to in this sentence), (i) any Restricted Subsidiary of the Company may consolidate or otherwise combine with, merge into or transfer all or part of its properties and assets to the Company, (ii) any Restricted Subsidiary may consolidate or otherwise combine with, merge into or transfer all or part of its properties and assets to any other Restricted Subsidiary and (iii) the Company may consolidate or otherwise combine with or merge into an Affiliate incorporated or organized for the purpose of changing the legal domicile of the Company, reincorporating the Company in another jurisdiction, or changing the legal form of the Company.

 

(e)           The foregoing provisions (other than the requirements of Section 4.1(a)(2)) shall not apply to the creation of a new Subsidiary as a Restricted Subsidiary of the Company.

 

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ARTICLE V

 

REDEMPTION OF SECURITIES

 

Section 5.1            Notices to Trustee.

 

If the Issuers elect to redeem Notes pursuant to the optional redemption provisions of Section 5.7 hereof, it must furnish to the Trustee, at least 15 days but not more than 60 days before a redemption date, an Officer’s Certificate setting forth:

 

(i)            the clause of this Indenture pursuant to which the redemption shall occur;

 

(ii)           the redemption date;

 

(iii)          the principal amount of Notes to be redeemed; and

 

(iv)          the redemption price.

 

Any optional redemption referenced in such Officer’s Certificate may be cancelled by the Issuers at any time prior to notice of redemption being sent to any Holder and thereafter shall be null and void.

 

Section 5.2            Selection of Notes to Be Redeemed or Purchased.

 

If less than all of the Notes are to be redeemed at any time, the Trustee will select the applicable Notes for redemption in compliance with the requirements of the principal securities exchange, if any, on which such Notes are listed, as certified to the Trustee by the Issuers, and in compliance with the requirements of DTC, or if Notes are not so listed or such exchange prescribes no method of selection and such Notes are not held through DTC or DTC prescribes no method of selection, by lot or on a pro rata basis, subject to adjustments so that no Note in an unauthorized denomination is redeemed in part and further; provided, however, that no Note of $2,000 in aggregate principal amount or less shall be redeemed in part.

 

Section 5.3            Notice of Redemption.

 

(a)           At least 15 but not more than 60 days before a redemption date, the Issuers will send or cause to be sent, by electronic delivery, if held at DTC, or by first class mail postage prepaid, a notice of redemption to each Holder whose Notes are to be redeemed at the address of such Holder appearing in the security register or otherwise in accordance with the applicable procedures of DTC, except that redemption notices may be delivered electronically or mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction and discharge of this Indenture pursuant to Articles VIII or XI hereof.

 

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The notice will identify the Notes (including the CUSIP or ISIN number) to be redeemed and will state:

 

(i)            the redemption date;

 

(ii)           the redemption price;

 

(iii)          if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the redemption date upon surrender of such Note, a new Note or Notes in principal amount equal to the unredeemed portion will be issued upon cancellation of the original Note;

 

(iv)          the name and address of the Paying Agent;

 

(v)           that Notes called for redemption must be surrendered to the Paying Agent to collect the redemption price;

 

(vi)          that, unless the Issuers default in making such redemption payment, interest on Notes called for redemption ceases to accrue on and after the redemption date;

 

(vii)         the paragraph of the Notes and/or Section of this Indenture pursuant to which the Notes called for redemption are being redeemed; and

 

(viii)        that no representation is made as to the correctness or accuracy of the CUSIP or ISIN number, if any, listed in such notice or printed on the Notes.

 

At the Issuers’ request, the Trustee will give the notice of redemption in the Issuers’ name and at their expense; provided, however, that the Issuers have delivered to the Trustee, at least 35 days prior to the redemption date (or such shorter period as the Trustee may agree), an Officer’s Certificate requesting that the Trustee give such notice and setting forth the information to be stated in such notice as provided in the preceding paragraph.

 

(b)           If any Note is to be redeemed in part only, the notice of redemption that relates to that Note shall state the portion of the principal amount thereof to be redeemed, in which case a portion of the original Note will be issued in the name of the Holder thereof upon cancellation of the original Note. In the case of a Global Note, an appropriate notation will be made on such Note to decrease the principal amount thereof to an amount equal to the unredeemed portion thereof. Subject to the terms of the applicable redemption notice (including any conditions contained therein), Notes called for redemption become due on the date fixed for redemption. On and after the redemption date, unless the Issuers default in the payment of the redemption payment, interest ceases to accrue on Notes or portions of them called for redemption.

 

Section 5.4            Effect of Notice of Redemption. Once notice of redemption is sent in accordance with Section 5.3 hereof, Notes called for redemption become irrevocably due and payable on the redemption date at the redemption price. Notice of redemption may, at the Issuers’ option and discretion, be subject to one or more conditions precedent, including, but not

 

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limited to, completion of an Equity Offering (in the case of redemption pursuant to Section 5.7(c) hereof) or Change of Control (in the case of purchase pursuant to Section 3.5 hereof), as the case may be. If such redemption is so subject to satisfaction of one or more conditions precedent, such notice shall describe each such condition, and if applicable, shall state that, in the Issuers’ discretion, the redemption date may be delayed until such time as any or all such conditions shall be satisfied, or such redemption may not occur and such notice may be rescinded in the event that any or all such conditions shall not have been satisfied by the redemption date, or by the redemption date as so delayed. In addition, the Issuers may provide in such notice that payment of the redemption price and performance of the Issuers’ obligations with respect to such redemption may be performed by another Person, provided that any such payment or performance occurs in accordance with the Indenture.

 

Section 5.5            Deposit of Redemption or Purchase Price. Prior to 10:00 a.m. Eastern Time on the redemption or purchase date, the Issuers will deposit with the Trustee or with the Paying Agent money sufficient to pay the redemption or purchase price of and accrued interest, if any, on, all Notes to be redeemed or purchased on that date. The Trustee or the Paying Agent will promptly return to the Issuers any money deposited with the Trustee or the Paying Agent by the Issuers in excess of the amounts necessary to pay the redemption or purchase price of, and accrued interest, if any, on, all Notes to be redeemed or purchased.

 

If the Issuers comply with the provisions of the preceding paragraph, on and after the redemption or purchase date, interest will cease to accrue on the Notes or the portions of Notes called for redemption or purchase. If a Note is redeemed or purchased on or after an interest record date but on or prior to the related interest payment date, then any accrued and unpaid interest shall be paid to the Person in whose name such Note was registered at the close of business on such record date. If any Note called for redemption or purchase is not so paid upon surrender for redemption or purchase because of the failure of the Issuers to comply with the preceding paragraph, interest shall be paid on the unpaid principal, from the redemption or purchase date until such principal is paid, and to the extent lawful on any interest not paid on such unpaid principal, in each case at the rate provided in the Notes and in Section 3.1 hereof.

 

Section 5.6            Notes Redeemed or Purchased in Part. Upon surrender of a Note that is redeemed or purchased in part, the Issuers will issue and, upon receipt of an Issuers Order, the Trustee will authenticate for the Holder at the expense of the Issuers a new Note equal in principal amount to the unredeemed or unpurchased portion of the Note surrendered; provided, that each such new Note will be in a minimum principal amount of $2,000 or integral multiple of $1,000 in excess thereof.

 

Section 5.7            Optional Redemption.

 

(a)           At any time prior to October 1, 2020, the Issuers may redeem the Notes in whole or in part, at their option, upon not less than 15 nor more than 60 days’ prior notice by electronic delivery or by first class mail, postage prepaid, with a copy to the Trustee, to each Holder of Notes to the address of such Holder appearing in the Notes Register, at a redemption price equal to 100% of the principal amount of such Notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to but excluding the date of redemption

 

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(the “Redemption Date”), subject to the rights of holders of the Notes on the relevant record date to receive interest due on the relevant interest payment date.

 

(b)           At any time and from time to time on or after October 1, 2020, the Issuers may redeem the Notes, in whole or in part, at their option, upon not less than 15 nor more than 60 days’ prior notice at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, to, but not including, the Redemption Date, subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date, if redeemed during the twelve month period beginning on October 1 of the year set forth below:

 

	
Redemption period
    	
 
    	
Price
    	
 
    
	
2020
    	
 
    	
102.625
    	
%
    
	
2021
    	
 
    	
101.313
    	
%
    
	
2022 and   thereafter
    	
 
    	
100.000
    	
%
    

 

(c)           At any time and from time to time prior to October 1, 2020, the Issuers may redeem Notes with the net cash proceeds received by the Issuers from any Equity Offering at a redemption price equal to 105.250% plus accrued and unpaid interest, if any, to, but not including, the Redemption Date, in an aggregate principal amount for all such redemptions not to exceed 35% of the original aggregate principal amount of the Notes (including Additional Notes); provided that (1) in each case the redemption takes place not later than 180 days after the closing of the related Equity Offering, and (2) not less than 50% of the original aggregate principal amount of the Notes issued under this Indenture remains outstanding immediately thereafter (excluding Notes held by the Issuers or any of their Restricted Subsidiaries). The Trustee shall select the Notes to be purchased in the manner described under Sections 5.1 through 5.6.

 

(d)           Unless the Issuers default in the payment of the redemption price, interest will cease to accrue on the Notes or portions thereof called for redemption on the applicable Redemption Date.

 

(e)           Any redemption pursuant to this Section 5.7 shall be made pursuant to the provisions of Sections 5.1 through 5.6.

 

Section 5.8            Mandatory Redemption. The Issuers are not required to make mandatory redemption or sinking fund payments with respect to the Notes; provided however, that under certain circumstances, the Issuers may be required to offer to purchase Notes under Section 3.5. The Issuers may at any time and from time to time purchase Notes in open-market transactions, tender offers or otherwise.

 

ARTICLE VI

 

DEFAULTS AND REMEDIES

 

Section 6.1            Events of Default.

 

(a)           Each of the following is an “Event of Default”:

 

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(i)            default in any payment of interest, on any Note when due and payable, continued for 30 days;

 

(ii)           default in the payment of the principal amount of or premium, if any, on any Note issued under this Indenture when due at its Stated Maturity, upon optional redemption, upon required repurchase, upon declaration or otherwise;

 

(iii)          (a) failure to comply with Section 3.5 and Section 4.1 for 30 days after written notice by the Trustee on behalf of the Holders or by the Holders of 30% in principal amount of the outstanding Notes with any agreement or obligation contained in this Indenture and (b) failure to comply with the agreements or obligations contained in this Indenture for 60 days after written notice by the Trustee on behalf of the Holders or by the Holders of 30% in principal amount of the outstanding Notes, provided that in the case of a failure to comply with Section 3.6, such period of continuance of such default or breach shall be 120 days after written notice described in this clause (iii)(b) has been given;

 

(iv)          default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is Guaranteed by the Company any of its Restricted Subsidiaries) other than Indebtedness owed to the Company or a Restricted Subsidiary or Non-Recourse Indebtedness whether such Indebtedness or Guarantee now exists, or is created after the date hereof, which default:

 

(1)           is caused by a failure to pay principal of such Indebtedness, at its stated final maturity (after giving effect to any applicable grace periods) provided in such Indebtedness (“payment default”); or

 

(2)           results in the acceleration of such Indebtedness prior to its stated final maturity (the “cross acceleration provision”);

 

and, in each case, the principal amount of any such Indebtedness, together with the principal amount of any other such Indebtedness under which there has been a payment default or the maturity of which has been so accelerated, aggregates $40.0 million or more;

 

(v)           any Issuer:

 

(1)           commences a voluntary case or proceeding;

 

(2)           consents to the entry of an order for relief against it in an involuntary case or proceeding;

 

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

 

(4)           makes a general assignment for the benefit of its creditors;

 

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(5)                                 consents to or acquiesces in the institution of a bankruptcy or an insolvency proceeding against it; or

 

(6)                                 takes any comparable action under any foreign laws relating to insolvency (collectively, the “bankruptcy provisions”);

 

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

 

(1)                                 is for relief against Parent, the Issuers or a Significant Subsidiary or group of Restricted Subsidiaries that together (as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary, in an involuntary case;

 

(2)                                 appoints a Custodian of Parent, the Issuers or a Significant Subsidiary or group of Restricted Subsidiaries that together (as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary, for substantially all of its property;

 

(3)                                 orders the winding up or liquidation of Parent, the Issuers or a Significant Subsidiary or group of Restricted Subsidiaries that together (as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries), would constitute a Significant Subsidiary; or

 

(4)                                 or any similar relief is granted under any foreign laws and the order, decree or relief remains unstayed and in effect for 60 consecutive days;

 

(vii)                           failure by the Company or any Significant Subsidiary (or group of Restricted Subsidiaries that, taken together (as of the latest audited consolidated financial statements for the Company and its Restricted Subsidiaries) would constitute a Significant Subsidiary), to pay final judgments aggregating in excess of $40.0 million other than any judgments covered by indemnities provided by, or insurance policies issued by, reputable and creditworthy companies, which final judgments remain unpaid, undischarged and unstayed for a period of more than 60 days after such judgment becomes final, and in the event such judgment is covered by insurance, an enforcement proceeding has been commenced by any creditor upon such judgment or decree which is not promptly stayed (the “judgment default provision”); and

 

(viii)                        any Guarantee of the Notes by a Guarantor ceases to be in full force and effect, other than (1) in accordance with the terms of this Indenture, (2) as a result of such Guarantor denying or disaffirming its obligations under its Guarantee of the Notes in accordance with the terms thereof or upon release of such Guarantee in accordance with this Indenture or (3) in connection with the bankruptcy of such Guarantor where the aggregate assets of such Guarantor and any other Guarantor whose Guarantee ceased or ceases to be in full force as a result of a bankruptcy are less than $40.0 million.

 

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(b)                                 Notwithstanding the foregoing, a default under Section 6.1(a)(iii), (iv) or (vii) will not constitute an Event of Default until the Trustee or the Holders of 30% in principal amount of the outstanding Notes notify the Company of the default and, with respect to Section 6.1(a)(iii) or (vii) the Company does not cure such default within the time specified in Section 6.1(a)(iii) or (vii), as applicable, after receipt of such notice.

 

Section 6.2                                    Acceleration.

 

(a)                                 If an Event of Default (other than an Event of Default described in Section 6.1(a)(v) and (a)(vi)) occurs and is continuing, the Trustee by written notice to the Issuers or the Holders of at least 30% in principal amount of the outstanding Notes by written notice to the Issuers and the Trustee may declare the principal of and accrued and unpaid interest, if any, on all the Notes to be immediately due and payable. Upon such a declaration, such principal and accrued and unpaid interest, if any, will be due and payable immediately.

 

In the event of any Event of Default specified in Section 6.1(a)(iv), such Event of Default and all consequences thereof shall be annulled, waived and rescinded, automatically and without any action by the Trustee or the Holders, if within 30 days after such Event of Default arose:

 

(i)                                     (x)                                 the Indebtedness that gave rise to such Event of Default shall have been discharged in full; or

 

(y)                                 the holders thereof have rescinded or waived the acceleration, notice or action (as the case may be) giving rise to such Event of Default; or

 

(z)                                  if the default that is the basis for such Event of Default has been cured.

 

(b)                                 If an Event of Default described in Section 6.1(a)(v) and (a)(vi) occurs and is continuing, the principal of and accrued and unpaid interest, if any, on all the Notes will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders.

 

If a default for a failure to report or failure to deliver a required certificate in connection with another default (the “Initial Default”) occurs, then at the time such Initial Default is cured, such Default for a failure to report or failure to deliver a required certificate in connection with another default that resulted solely because of that Initial Default will also be cured without any further action and any Default or Event of Default for the failure to comply with the time periods prescribed in Section 3.6 or otherwise to deliver any notice or certificate pursuant to any other provision of this Indenture shall be deemed to be cured upon the delivery of any such report required by such covenant or such notice or certificate, as applicable, even though such delivery is not within the prescribed period specified in this Indenture.

 

Section 6.3                                    Other Remedies. If an Event of Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of, or premium, if any, or interest on the Notes or to enforce the performance of any provision of the Notes or this Indenture.

 

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The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding. A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon an Event of Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Event of Default. No remedy is exclusive of any other remedy. All available remedies are cumulative.

 

Section 6.4                                    Waiver of Past Defaults. The Holders of a majority in aggregate principal amount of the then outstanding Notes by written notice to the Trustee may, on behalf of all of the Holders, (a) waive, by their consent (including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes), an existing Default or Event of Default and its consequences under this Indenture except (i) a Default or Event of Default in the payment of the principal of or interest on a Note or (ii) a Default or Event of Default in respect of a provision that under Section 9.2 cannot be amended without the consent of each Holder affected and (b) rescind any acceleration with respect to the Notes and its consequences if (1) such rescission would not conflict with any judgment or decree of a court of competent jurisdiction, (2) all existing Events of Default have been cured or waived except nonpayment of principal, premium, if any, or interest that has become due solely because of the acceleration, (3) to the extent the payment of such interest is lawful, interest on overdue installments of interest, premium, if any, and overdue principal, which has become due otherwise than by such declaration of acceleration, has been paid, (4) the Issuers have paid the Trustee its compensation and reimbursed the Trustee for its reasonable expenses, disbursements and advances and (5) in the event of the cure or waiver of an Event of Default of the type described Section 6.1(a)(iv), the Trustee shall have received an Officer’s Certificate and an Opinion of Counsel stating that such Event of Default has been cured or waived. No such rescission shall affect any subsequent Default or impair any right consequent thereto. When a Default or Event of Default is waived, it is deemed cured, but no such waiver shall extend to any subsequent or other Default or Event of Default or impair any consequent right.

 

Section 6.5                                    Control by Majority.  The Holders of a majority in principal amount of the outstanding Notes may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or power conferred on the Trustee. However, the Trustee may refuse to follow any direction that conflicts with law or this Indenture or the Notes or, subject to Sections 7.1 and 7.2, that the Trustee determines is unduly prejudicial to the rights of other Holders or would involve the Trustee in personal liability; provided, however, that the Trustee may take any other action deemed proper by the Trustee that is not inconsistent with such direction. The Trustee will be under no obligation to exercise any of the rights or powers under this Indenture at the request or direction of any of the Holders unless such Holders have offered (and if requested, provided) to the Trustee indemnity or security satisfactory to the Trustee against any loss, liability or expense.

 

Section 6.6                                    Limitation on Suits. Subject to Section 6.7, no Holder may pursue any remedy with respect to this Indenture or the Notes unless:

 

(i)                                     such Holder has previously given the Trustee written notice that an Event of Default is continuing;

 

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(ii)                                  Holders of at least 30% in principal amount of the outstanding Notes have requested in writing the Trustee to pursue the remedy;

 

(iii)                               such Holders have offered in writing the Trustee security or indemnity satisfactory to the Trustee against any loss, liability or expense;

 

(iv)                              the Trustee has not complied with such request within 60 days after the receipt of the written request and the offer of security or indemnity; and

 

(v)                                 the Holders of a majority in principal amount of the outstanding Notes have not given the Trustee a written direction that, in the opinion of the Trustee, is inconsistent with such request within such 60-day period.

 

A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over another Holder (it being understood that the Trustee does not have an affirmative duty to ascertain whether or not such actions or forbearances are unduly prejudicial to such Holders).

 

Section 6.7                                    [Reserved].

 

Section 6.8                                    Collection Suit by Trustee. If an Event of Default specified in Section 6.1(a)(i) or (ii) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Issuers for the whole amount then due and owing (together with interest on any unpaid interest, if any, to the extent lawful) and the amounts provided for in Section 7.7.

 

Section 6.9                                    Trustee May File Proofs of Claim. The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relative to the Issuers, their Subsidiaries or its or their respective creditors or properties and, unless prohibited by law or applicable regulations, may be entitled and empowered to participate as a member of any official committee of creditors appointed in such matter and may vote on behalf of the Holders in any election of a trustee in bankruptcy or other Person performing similar functions, and any Custodian in any such judicial proceeding is hereby authorized by each Holder to make payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the compensation, expenses, disbursements and advances of the Trustee, its agents and its counsel, and any other amounts due the Trustee under Section 7.7.

 

No provision of this Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.

 

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Section 6.10                             Priorities.

 

(a)                                 If the Trustee collects any money or property pursuant to this Article VI, it shall pay out the money or property in the following order:

 

FIRST: to the Trustee for amounts due to it under Section 7.7;

 

SECOND: to Holders for amounts due and unpaid on the Notes for principal of, or premium, if any, and interest ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal of, or premium, if any, and interest, respectively; and

 

THIRD: to the Issuers, or to the extent the Trustee collects any amount for any Guarantor, to such Guarantor.

 

(b)                                 The Trustee may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10. At least 15 days before such record date, the Issuers shall send or cause to be sent to each Holder and the Trustee a notice that states the record date, the payment date and amount to be paid.

 

Section 6.11                             Undertaking for Costs. In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant. This Section 6.11 does not apply to a suit by the Trustee, a suit by the Issuers, a suit by a Holder pursuant to Section 6.7 or a suit by Holders of more than 10% in outstanding principal amount of the Notes.

 

ARTICLE VII

 

TRUSTEE

 

Section 7.1                                    Duties of Trustee.

 

(a)                                 If an Event of Default has occurred and is continuing, the Trustee shall exercise the rights and powers vested in it by this Indenture and use the same degree of care and skill in its exercise as a prudent Person would exercise or use under the circumstances in the conduct of such person’s own affairs.

 

(b)                                 Except during the continuance of an Event of Default:

 

(i)                                     the Trustee undertakes to perform such duties and only such duties as are specifically set forth as duties of the Trustee in this Indenture or the Notes and no implied covenants or obligations shall be read into this Indenture against the Trustee; and

 

(ii)                                  in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates, opinions or orders furnished to the Trustee and

 

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conforming to the requirements of this Indenture or the Notes, as the case may be. However, in the case of any such certificates or opinions which by any provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall examine such certificates and opinions to determine whether or not they conform to the requirements of this Indenture or the Notes, as the case may be (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

 

(c)                                  The Trustee may not be relieved from liability for its own grossly negligent action, its own grossly negligent failure to act or its own willful misconduct, except that:

 

(i)                                     this paragraph does not limit the effect of paragraph (b) of this Section 7.1;

 

(ii)                                  the Trustee shall not be liable for any error of judgment made in good faith by a Trust Officer unless it is proved that the Trustee was grossly negligent in ascertaining the pertinent facts;

 

(iii)                               the Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.5; and

 

(d)                                 No provision of this Indenture or the Notes shall require the Trustee to expend or risk its own funds or otherwise incur financial liability in the performance of any of its duties hereunder or thereunder or in the exercise of any of its rights or powers, if it shall have reasonable grounds to believe that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it.

 

(e)                                  Every provision of this Indenture that in any way relates to the Trustee is subject to paragraphs (a), (b), (c) and (d) of this Section 7.1.

 

(f)                                   The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Issuers.

 

(g)                                  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

 

(h)                                 Every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 7.1.

 

Section 7.2                                    Rights of Trustee. Subject to Section 7.1:

 

(i)                                     The Trustee may conclusively rely on and shall be fully protected in acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order or other paper or document (whether in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper Person. The Trustee need not investigate any

 

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fact or matter stated in the document. The Trustee shall receive and retain financial reports and statements of the Issuers as provided herein, but shall have no duty to review or analyze such reports or statements to determine compliance with covenants or other obligations of the Issuers.

 

(ii)                                  Before the Trustee acts or refrains from acting, it may require an Officer’s Certificate and/or an Opinion of Counsel. The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on an Officer’s Certificate or Opinion of Counsel.

 

(iii)                               The Trustee may execute any of the trusts and powers hereunder or perform any duties hereunder either directly or by or through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent or attorney appointed with due care by it hereunder.

 

(iv)                              The Trustee shall not be liable for any action it takes or omits to take in good faith which it believes to be authorized or within its rights or powers conferred upon it by this Indenture.

 

(v)                                 The Trustee may consult with counsel of its selection, and the advice or opinion of counsel relating to this Indenture or the Notes shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder or under the Notes in good faith and in accordance with the advice or opinion of such counsel.

 

(vi)                              The Trustee shall not be deemed to have notice of any Default or Event of Default or whether any entity or group of entities constitutes a Significant Subsidiary unless a Trust Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a Default or of any such Significant Subsidiary is received by the Trustee at the corporate trust office of the Trustee specified in Section 3.7, and such notice references the Notes and this Indenture.

 

(vii)                           The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder.

 

(viii)                        The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture or the Notes at the request, order or direction of any of the Holders pursuant to the provisions of this Indenture, unless such Holders shall have offered to the Trustee security or indemnity satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby.

 

(ix)                              The Trustee shall not be deemed to have knowledge of any fact or matter unless such fact or matter is actually known to a Trust Officer of the Trustee.

 

(x)                                 Whenever in the administration of this Indenture or the Notes the Trustee shall deem it desirable that a matter be proved or established prior to taking,

 

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suffering or omitting any action hereunder or thereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith or willful misconduct on its part, conclusively rely upon an Officer’s Certificate.

 

(xi)                              The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, report, notice, request, direction, consent, order, bond, debenture, coupon or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine, during business hours and upon reasonable notice, the books, records and premises of the Issuers and the Restricted Subsidiaries, personally or by agent or attorney at the sole cost of the Issuers and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation.

 

(xii)                           The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder.

 

(xiii)                        The Trustee may request that the Issuers deliver an Officer’s Certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture or the Notes.

 

(xiv)                       In no event shall the Trustee be liable to any Person for special, punitive, indirect, consequential or incidental loss or damage of any kind whatsoever (including, but not limited to, lost profits), even if the Trustee has been advised of the likelihood of such loss or damage.

 

(xv)                          Unless otherwise specifically provided in this Indenture, any demand, request, direction or notice from the Issuers shall be sufficient if signed by one Officer of each of the Issuers.

 

Section 7.3                                    Individual Rights of Trustee. The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuers, Guarantors or their Affiliates with the same rights it would have if it were not Trustee. Any Paying Agent, Registrar, co-registrar or co-paying agent may do the same with like rights. However, the Trustee must comply with Sections 7.10 and Section 7.11. In addition, the Trustee shall be permitted to engage in transactions with the Issuers and their Affiliates and Subsidiaries.

 

Section 7.4                                    Trustee’s Disclaimer. The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, shall not be accountable for the Issuers’ use of the proceeds from the sale of the Notes, shall not be responsible for the use or application of any money received by any Paying Agent other than the Trustee or any money paid to the Issuers pursuant to the terms of this Indenture and shall not be responsible for any statement of the Issuers in this Indenture or in any document issued in connection with the sale of the Notes or in the Notes other than the Trustee’s certificate of authentication.

 

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Section 7.5                                    Notice of Defaults. If a Default or Event of Default occurs and is continuing and if a Trust Officer has actual knowledge thereof, the Trustee shall send electronically or by first class mail to each Holder at the address set forth in the Notes Register notice of the Default or Event of Default within 60 days after it is actually known to a Trust Officer. Except in the case of a Default or Event of Default in payment of principal of, or premium, if any, or interest on any Note (including payments pursuant to the optional redemption or required repurchase provisions of such Note), the Trustee may withhold the notice if and so long as it in good faith determines that withholding the notice is in the interests of Holders.

 

Section 7.6                                    [Reserved].

 

Section 7.7                                    Compensation and Indemnity. The Issuers shall pay to the Trustee from time to time compensation for its services hereunder and under the Notes as the Issuers and the Trustee shall from time to time agree in writing. The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust. The Issuers shall reimburse the Trustee upon request for all reasonable out-of-pocket expenses incurred or made by it, including, but not limited to, costs of collection, costs of preparing reports, certificates and other documents, costs of preparation and mailing of notices to Holders. Such expenses shall include the reasonable compensation and expenses, disbursements and advances of the agents, counsel, accountants and experts of the Trustee. The Issuers shall indemnify the Trustee against any and all fees, loss, liability, damages, claims or expense, including taxes (other than taxes based upon the income of the Trustee) (including reasonable attorneys’ and agents’ fees and expenses) incurred by it without willful misconduct, gross negligence or bad faith, as determined by a court of competent jurisdiction, on its part in connection with the administration of this trust and the performance of its duties hereunder and under the Notes, including the fees, costs and expenses of enforcing this Indenture (including this Section 7.7) and the Notes and of defending itself against any claims (whether asserted by any Holder, the Issuers or otherwise). The Trustee shall notify the Issuers promptly of any claim for which it may seek indemnity of which it has received written notice. Failure by the Trustee to so notify the Issuers shall not relieve the Issuers of their obligations hereunder. The Issuers shall defend the claim and the Trustee shall provide reasonable cooperation at the Issuers’ expense in the defense. The Trustee may have separate counsel and the Issuers shall pay the fees and expenses of such counsel; provided that the Issuers shall not be required to pay the fees and expenses of such separate counsel if it assumes the Trustee’s defense, and, in the reasonable judgment of outside counsel to the Trustee, there is no conflict of interest between the Issuers and the Trustee in connection with such defense.

 

To secure the Issuers’ payment obligations in this Section 7.7, the Trustee shall have a lien prior to the Notes on all money or property held or collected by the Trustee. Such lien shall survive the satisfaction and discharge of this Indenture. The Trustee’s respective right to receive payment of any amounts due under this Section 7.7 shall not be subordinate to any other liability or Indebtedness of the Issuers.

 

The Issuers’ payment obligations pursuant to this Section 7.7 shall survive the discharge of this Indenture and any resignation or removal of the Trustee. Without prejudice to any other rights available to the Trustee under applicable law, when the Trustee incurs fees, expenses or renders services after the occurrence of a Default specified in Section 6.1(a)(v) or (a)(vi), the

 

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fees and expenses (including the reasonable fees and expenses of its counsel) are intended to constitute expenses of administration under any Bankruptcy Law.

 

Section 7.8                                    Replacement of Trustee. The Trustee may resign at any time by so notifying the Company in writing not less than 30 days prior to the effective date of such resignation. The Holders of a majority in principal amount of the Notes may remove the Trustee by so notifying the removed Trustee in writing not less than 30 days prior to the effective date of such removal and may appoint a successor Trustee with the Company’s written consent, which consent will not be unreasonably withheld. The Company shall remove the Trustee if:

 

(i)                                     the Trustee fails to comply with Section 7.10 hereof;

 

(ii)                                  the Trustee is adjudged bankrupt or insolvent;

 

(iii)                               a receiver or other public officer takes charge of the Trustee or its property; or

 

(iv)                              the Trustee otherwise becomes incapable of acting.

 

If the Trustee resigns or is removed by the Company or by the Holders of a majority in principal amount of the Notes and such Holders do not reasonably promptly appoint a successor Trustee as described in the preceding paragraph, or if a vacancy exists in the office of the Trustee for any reason (the Trustee in such event being referred to herein as the retiring Trustee), the Company shall promptly appoint a successor Trustee.

 

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Company. Thereupon the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture. The successor Trustee shall mail a notice of its succession to Holders. The retiring Trustee shall, at the expense of the Company, promptly transfer all property held by it as Trustee to the successor Trustee, subject to the lien provided for in Section 7.7.

 

If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee or the Holders of at least 10% in principal amount of the Notes may petition, at the Company’s expense, any court of competent jurisdiction for the appointment of a successor Trustee.

 

If the Trustee fails to comply with Section 7.10, any Holder, who has been a bona fide holder of a Note for at least six months, may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

 

Notwithstanding the replacement of the Trustee pursuant to this Section 7.8, the Company’s obligations under Section 7.7 shall continue for the benefit of the retiring Trustee. The predecessor Trustee shall have no liability for any action or inaction of any successor Trustee.

 

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Section 7.9            Successor Trustee by Merger. If the Trustee consolidates with, merges or converts into, or transfers all or substantially all its corporate trust business or assets to, another corporation or banking association, the resulting, surviving or transferee corporation without any further act shall be the successor Trustee.

 

In case at the time such successor or successors by merger, conversion or consolidation to the Trustee shall succeed to the trusts created by this Indenture, any of the Notes shall have been authenticated but not delivered, any such successor to the Trustee may adopt the certificate of authentication of any predecessor trustee, and deliver such Notes so authenticated; and in case at that time any of the Notes shall not have been authenticated, any successor to the Trustee may authenticate such Notes either in the name of any predecessor hereunder or in the name of the successor to the Trustee; provided that the right to adopt the certificate of authentication of any predecessor Trustee or authenticate Notes in the name of any predecessor Trustee shall only apply to its successor or successors by merger, consolidation or conversion.

 

Section 7.10          Eligibility; Disqualification. There shall at all times be a Trustee hereunder that is a Person organized and doing business under the laws of the United States of America or of any state thereof that is authorized under such laws to exercise corporate trustee power, that is subject to supervision or examination by federal or state authorities and that has a combined capital and surplus of at least $100.0 million (or a wholly-owned subsidiary of a bank or trust company, or of a bank holding company, the principal subsidiary of which is a bank or trust company having a combined capital and surplus of at least $100.0 million) as set forth in its most recent published annual report of condition.

 

Section 7.11          [Reserved].

 

Section 7.12          Trustee’s Application for Instruction from the Issuers. Any application by the Trustee for written instructions from the Issuers may, at the option of the Trustee, set forth in writing any action proposed to be taken or omitted by the Trustee under this Indenture and the date on and/or after which such action shall be taken or such omission shall be effective. The Trustee shall not be liable for any action taken by, or omission of, the Trustee in accordance with a proposal included in such application on or after the date specified in such application (which date shall not be less than three Business Days after the date any Officer of the Issuers actually receives such application, unless any such Officer shall have consented in writing to any earlier date) unless prior to taking any such action (or the effective date in the case of an omission), the Trustee shall have received written instructions in response to such application specifying the action to be taken or omitted.

 

ARTICLE VIII

 

LEGAL DEFEASANCE AND COVENANT DEFEASANCE

 

Section 8.1            Option to Effect Legal Defeasance or Covenant Defeasance; Defeasance. The Issuers may, at their option and at any time, elect to have either Section 8.2 or 8.3 hereof be applied to all outstanding Notes upon compliance with the conditions set forth in this Article VIII.

 

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Section 8.2            Legal Defeasance and Discharge. Upon the Issuers’ exercise under Section 8.1 hereof of the option applicable to this Section 8.2, the Issuers and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.4 hereof, be deemed to have been discharged from their obligations with respect to all outstanding Notes (including the Guarantees) on the date the conditions set forth in Section 8.4 are satisfied (hereinafter, “Legal Defeasance”). For this purpose, Legal Defeasance means that the Issuers and the Guarantors will be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes (including the Guarantees), which will thereafter be deemed to be “outstanding” only for the purposes of Section 8.5 hereof and the other Sections of this Indenture referred to in clauses (1) and (2) below, and to have satisfied all of their other obligations under such Notes, the Guarantees and this Indenture (and the Trustee, on written demand of and at the expense of the Issuers, shall execute such instruments reasonably requested by the Issuers acknowledging the same) and to have cured all then existing Events of Default, except for the following provisions which will survive until otherwise terminated or discharged hereunder:

 

(i)            the rights of Holders of Notes issued under this Indenture to receive payments in respect of the principal of, premium, if any, and interest on the Notes when such payments are due solely out of the trust referred to in Section 8.4 hereof;

 

(ii)           the Issuers’ obligations with respect to the Notes under Article II concerning issuing temporary Notes, registration of such Notes, mutilated, destroyed, lost or stolen Notes and Section 3.7 hereof concerning the maintenance of an office or agency for payment and money for security payments held in trust;

 

(iii)          the rights, powers, trusts, duties and immunities of the Trustee and the Issuers’ or Guarantors’ obligations in connection therewith; and

 

(iv)          this Article VIII with respect to provisions relating to Legal Defeasance.

 

Subject to compliance with this Section 8.2, the Issuers may exercise their option under Section 8.2 notwithstanding the prior exercise of its option under Section 8.3 hereof.

 

Section 8.3            Covenant Defeasance. Upon the Issuers’ exercise under Section 8.1 hereof of the option applicable to this Section 8.3, the Issuers and each of the Guarantors will, subject to the satisfaction of the conditions set forth in Section 8.4 hereof, be released from each of their obligations under the covenants contained in Section 3.2, 3.3, 3.4, 3.5, 3.6, 3.14, 3.15 and Section 4.1 (except Section 4.1(a)(1) and (a)(2)) hereof with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.4 hereof are satisfied (hereinafter, “Covenant Defeasance”), and the Notes will thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but will continue to be deemed “outstanding” for all other purposes hereunder. For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes and Guarantees, the Issuers and the Guarantors may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein

 

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or in any other document and such omission to comply shall not constitute a Default or an Event of Default under Section 6.1 hereof, but, except as specified in this Section, the remainder of this Indenture and such Notes and Guarantees will be unaffected thereby. In addition, upon the Company’s exercise under Section 8.1 hereof of the option applicable to this Section 8.3, subject to the satisfaction of the conditions set forth in Section 8.4 hereof, Sections 6.1(a)(iii) (solely with respect to the defeased covenants listed above), 6.1(a)(iv), 6.1(a)(v) (with respect only to the Company and a Guarantor that is a Significant Subsidiary or any group of Guarantors that taken together would constitute a Significant Subsidiary), 6.1(a)(vi) (with respect only to the Company and a Guarantor that is a Significant Subsidiary or any group of Guarantors that taken together would constitute a Significant Subsidiary), 6.1(a)(vii) and 6.1(a)(viii) hereof shall not constitute Events of Default.

 

Section 8.4            Conditions to Legal or Covenant Defeasance. In order to exercise either Legal Defeasance or Covenant Defeasance under either Section 8.2 or 8.3 hereof:

 

(i)            the Company must irrevocably deposit with the Trustee, in trust (the “Defeasance Trust”), for the benefit of the Holders, cash in dollars or U.S. Government Obligations or a combination thereof in such amounts as will be sufficient, in the opinion of a nationally recognized firm of independent public accountants, to pay the principal of and premium, if any, and interest due on the Notes issued under this Indenture on the stated maturity date or on the applicable redemption date, as the case may be, and the Company must specify whether such Notes are being defeased to maturity or to a particular redemption date;

 

(ii)           in the case of Legal Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States stating that, subject to customary assumptions and exclusions;

 

(1)           the Company has received from, or there has been published by, the United States Internal Revenue Service a ruling; or

 

(2)           since the issuance of such Notes, there has been a change in the applicable U.S. federal income tax law;

 

in either case stating that, and based thereon such Opinion of Counsel in the United States shall confirm that, subject to customary assumptions and exclusions, the Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred;

 

(iii)          in the case of Covenant Defeasance, the Company shall have delivered to the Trustee an Opinion of Counsel in the United States, subject to customary assumptions and exclusions, stating that, subject to customary assumptions and exclusions, the Holders, in their capacity as Holders of the Notes, will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the

 

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same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred;

 

(iv)          no Default or Event of Default (other than that resulting from borrowing funds to be applied to make such deposit and the granting of Liens in connection therewith) shall have occurred and be continuing on the date of such deposit;

 

(v)           such Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a default under the Credit Facilities or any other material agreement or instrument (other than this Indenture) to which, the Issuers or any Guarantor is a party or by which the Issuers or any Guarantor is bound;

 

(vi)          the Issuers shall have delivered to the Trustee an Officer’s Certificate stating that the deposit was not made by the Company with the intent of defeating, hindering, delaying, defrauding or preferring any creditors of the Company; and

 

(vii)         the Issuers shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and exclusions), each stating that all conditions precedent provided for or relating to Legal Defeasance or Covenant Defeasance, as the case may be, have been complied with.

 

Section 8.5            Deposited Money and U.S. Government Obligations to be Held in Trust; Other Miscellaneous Provisions. Subject to Section 8.6 hereof, all money and U.S. Government Obligations (including the proceeds thereof) deposited with the Trustee (or other qualifying trustee, collectively for purposes of this Section 8.5, the “Trustee”) pursuant to Section 8.4 hereof in respect of the outstanding Notes will be held in trust and applied by the Trustee, in accordance with the provisions of such Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Issuers acting as Paying Agent) as the Trustee may determine, to the Holders of such Notes of all sums due and to become due thereon in respect of principal, premium, if any, and interest, but such money need not be segregated from other funds except to the extent required by law.

 

The Issuers will pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the cash or U.S. Government Obligations deposited pursuant to Section 8.4 hereof or the principal and interest received in respect thereof other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.

 

Notwithstanding anything in this Article VIII to the contrary, the Trustee will deliver or pay to the Issuers from time to time upon the request of the Issuers any money or U.S. Government Obligations held by it as provided in Section 8.4 hereof which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee (which may be the opinion delivered under Section 8.4(1) hereof), are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

 

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Section 8.6            Repayment to the Issuers. Any money deposited with the Trustee or any Paying Agent, or then held by the Issuers, in trust for the payment of the principal of, premium, if any, or interest on, any Note and remaining unclaimed for two years after such principal, premium, if any, or interest has become due and payable shall be paid to the Issuers on its written request unless an abandoned property law designates another Person or (if then held by the Issuers) will be discharged from such trust; and the Holder of such Note will thereafter be permitted to look only to the Issuers for payment thereof unless an abandoned property law designates another Person, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Issuers as trustee thereof, will thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, shall at the expense of the Issuers cause to be published once, in The New York Times and The Wall Street Journal (national edition), notice that such money remains unclaimed and that, after a date specified therein, which will not be less than 30 days from the date of such notification or publication, any unclaimed balance of such money then remaining will be repaid to the Issuers.

 

Section 8.7            Reinstatement. If the Trustee or Paying Agent is unable to apply any money or U.S. dollars or U.S. Government Obligations in accordance with Section 8.2 or 8.3 hereof, as the case may be, by reason of any order or judgment of any court or Governmental Authority enjoining, restraining or otherwise prohibiting such application, then the Issuers’ and the Guarantors’ obligations under this Indenture and the Notes and the Guarantees will be revived and reinstated as though no deposit had occurred pursuant to Section 8.2 or 8.3 hereof until such time as the Trustee or Paying Agent is permitted to apply all such money in accordance with Section 8.2 or 8.3 hereof, as the case may be; provided, however, that, if the Issuers make any payment of principal of, premium, if any, or interest on, any Note following the reinstatement of its obligations, the Issuers will be subrogated to the rights of the Holders of such Notes to receive such payment from the money or U.S. Government Obligations held by the Trustee or Paying Agent.

 

ARTICLE IX

 

AMENDMENTS

 

Section 9.1            Without Consent of Holders. Notwithstanding Section 9.2 of this Indenture, the Issuers, any Guarantor (with respect to its Guarantee or this Indenture) and the Trustee may amend, supplement or modify this Indenture, any Guarantee and the Notes without the consent of any Holder:

 

(i)            to cure any ambiguity, omission, mistake, defect, error or inconsistency, conform any provision to any provision under the heading “Description of Notes,” in the Offering Memorandum or reduce the minimum denomination of the Notes;

 

(ii)           to provide for the assumption by a successor Person of the obligations of any Issuer or a Guarantor under any Note Document;

 

(iii)          to provide for uncertificated Notes in addition to or in place of certificated Notes;

 

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(iv)          to add to the covenants or provide for a Guarantee for the benefit of the Holders or surrender any right or power conferred upon the Company or any Restricted Subsidiary;

 

(v)           to make any change that does not adversely affect the rights of any Holder in any material respect;

 

(vi)          at the Company’s election, to comply with any requirement of the SEC in connection with the qualification of this Indenture under the Trust Indenture Act, if such qualification is required;

 

(vii)         to make such provisions as necessary (as determined in good faith by the Company) for the issuance of Additional Notes;

 

(viii)        to provide for any Restricted Subsidiary to provide a Guarantee in accordance with Section 3.2, to add Guarantees with respect to the Notes, to add security to or for the benefit of the Notes, or to confirm and evidence the release, termination, discharge or retaking of any Guarantee or Lien with respect to or securing the Notes when such release, termination, discharge or retaking is provided for under this Indenture;

 

(ix)          to evidence and provide for the acceptance and appointment under this Indenture of a successor Trustee pursuant to the requirements hereof or to provide for the accession by the Trustee to any Note Document; or

 

(x)           to make any amendment to the provisions of this Indenture relating to the transfer and legending of Notes as permitted by this Indenture, including, without limitation, to facilitate the issuance and administration of Notes; provided, however, that (i) compliance with this Indenture as so amended would not result in Notes being transferred in violation of the Securities Act or any applicable securities law and (ii) such amendment does not materially and adversely affect the rights of Holders to transfer Notes.

 

Subject to Section 9.2, upon the request of the Issuers, and upon receipt by the Trustee of the documents described in Sections 9.6 and 12.4 hereof, the Trustee will join with the Issuers and the Guarantors in the execution of such amended or supplemental indenture unless such amended or supplemental indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but will not be obligated to, enter into such amended or supplemental Indenture.

 

Section 9.2            With Consent of Holders.

 

(a)           Except as provided in this Section 9.2, the Issuers, the Guarantors and the Trustee may amend or supplement the Note Documents with the consent of the Holders of at least a majority in aggregate principal amount of the Notes then outstanding and issued under this Indenture, including, without limitation, consents obtained in connection with a purchase of, or tender offer or exchange offer for, Notes, and, subject to Sections 6.4 and 6.7 hereof, any existing Default or Event of Default (other than a Default or Event of Default in the payment of

 

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the principal of, premium, if any, or interest on the Notes, except a payment default resulting from an acceleration that has been rescinded) or compliance with any provision of the Note Documents may be waived with the consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes issued under this Indenture (including consents obtained in connection with a purchase of or tender offer or exchange offer for Notes). Section 2.12 hereof and Section 12.6 hereof shall determine which Notes are considered to be “outstanding” for the purposes of this Section 9.2.

 

Upon the request of the Issuers, and upon the filing with the Trustee of evidence of the consent of the Holders of Notes as aforesaid, and upon receipt by the Trustee of the documents described in Sections 9.6 and 12.4 hereof, the Trustee will join with the Issuers and the Guarantors in the execution of such amended or supplemental indenture unless such amended or supplemental indenture affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise, in which case the Trustee may in its discretion, but will not be obligated to, enter into such amended or supplemental Indenture.

 

(b)           Without the consent of each Holder of Notes affected, an amendment, supplement or waiver may not, with respect to any Notes issued thereunder and held by a nonconsenting Holder:

 

(i)            reduce the principal amount of such Notes whose Holders must consent to an amendment;

 

(ii)           reduce the stated rate of or extend the stated time for payment of interest on any such Note (other than provisions relating to Section 3.5);

 

(iii)          reduce the principal of or extend the Stated Maturity of any such Note;

 

(iv)          reduce the premium payable upon the redemption of any such Note or change the time at which any such Note may be redeemed, in each case as set forth in Section 5.7;

 

(v)           make any such Note payable in currency other than that stated in such Note;

 

(vi)          impair the right of any Holder to institute suit for the enforcement of any payment of principal of and interest on such Holder’s Notes on or after the due dates therefor;

 

(vii)         waive a Default or Event of Default with respect to the nonpayment of principal, premium or interest (except pursuant to a rescission of acceleration of the Notes by the Holders of at least a majority in aggregate principal amount of such Notes and a waiver of the payment default that resulted from such acceleration); or

 

(viii)        make any change in the amendment or waiver provisions which require the Holders’ consent described in this Section 9.2.

 

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It shall not be necessary for the consent of the Holders under this Indenture to approve the particular form of any proposed amendment, supplement or waiver, but it shall be sufficient if such consent approves the substance thereof. A consent to any amendment, supplement or waiver under this Indenture by any Holder of the Notes given in connection with a tender or exchange of such Holder’s Notes will not be rendered invalid by such tender or exchange.

 

Section 9.3            [Reserved].

 

Section 9.4            Revocation and Effect of Consents and Waivers. Until an amendment, supplement or waiver becomes effective, a consent to it by a Holder of a Note is a continuing consent by the Holder of a Note and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent or waiver is not made on any Note. However, any such Holder of a Note or subsequent Holder of a Note may revoke the consent or waiver as to such Holder’s Note or portion of its Note if the Trustee receives written notice of revocation before the date the amendment, supplement or waiver becomes effective. An amendment, supplement or waiver becomes effective in accordance with its terms and thereafter binds every Holder.

 

The Issuers may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to give their consent or take any other action described in this Section or required or permitted to be taken pursuant to this Indenture. If a record date is fixed, then notwithstanding the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to give such consent or to revoke any consent previously given or to take any such action, whether or not such Persons continue to be Holders after such record date. No such consent shall be valid or effective for more than 120 days after such record date.

 

Section 9.5            Notation on or Exchange of Notes. The Trustee may place an appropriate notation about an amendment, supplement or waiver on any Note thereafter authenticated. The Issuers in exchange for all Notes may issue and the Trustee shall, upon receipt of an Issuers Order, authenticate new Notes that reflect the amendment, supplement or waiver. Failure to make the appropriate notation or issue a new Note will not affect the validity and effect of such amendment, supplement or waiver.

 

Section 9.6            Trustee to Sign Amendments. The Trustee shall sign any amended or supplemental indenture authorized pursuant to this Article IX if the amendment or supplement does not adversely affect the rights, duties, liabilities or immunities of the Trustee. In executing any amended or supplemental indenture, the Trustee will be entitled to receive and (subject to Sections 7.1 and 7.2 hereof) shall be fully protected in conclusively relying upon, in addition to the documents required by Section 12.4 hereof, an Officer’s Certificate and an Opinion of Counsel stating that the execution of such amended or supplemental indenture is authorized or permitted by this Indenture and is valid, binding and enforceable against the Issuers or any Guarantor, as the case may be, in accordance with its terms.

 

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ARTICLE X

 

GUARANTEE

 

Section 10.1          Guarantee. Subject to the provisions of this Article X, each Guarantor hereby fully, unconditionally and irrevocably guarantees, as primary obligor and not merely as surety, jointly and severally with each other Guarantor, to each Holder of the Notes and the Trustee the full and punctual payment when due, whether at maturity, by acceleration, by redemption or otherwise, of the principal of, premium, if any, and interest on the Notes and all other obligations and liabilities of the Issuers under this Indenture (including without limitation interest accruing after the filing of any petition in bankruptcy, or the commencement of any insolvency, reorganization or like proceeding, relating to the Issuers or any Guarantor whether or not a claim for post-filing or post-petition interest is allowed in such proceeding and the obligations under Section 7.7) (all the foregoing being hereinafter collectively called the “Guaranteed Obligations”). Each Guarantor agrees that the Guaranteed Obligations will rank equally in right of payment with other Indebtedness of such Guarantor, except to the extent such other Indebtedness is subordinate to the Guaranteed Obligations, in which case the obligations of the Guarantors under the Guarantees will rank senior in right of payment to such other Indebtedness.

 

To evidence its Guarantee set forth in this Section 10.1, each Guarantor hereby agrees that this Indenture shall be executed on behalf of such Guarantor by an Officer of such Guarantor.

 

Each Guarantor hereby agrees that its Guarantee set forth in Section 10.1 hereof shall remain in full force and effect notwithstanding the absence of the endorsement of any notation of such Guarantee on the Notes.

 

If an Officer whose signature is on this Indenture no longer holds that office at the time the Trustee authenticates the Note, the Guarantee shall be valid nevertheless.

 

Each Guarantor further agrees (to the extent permitted by law) that the Guaranteed Obligations may be extended or renewed, in whole or in part, without notice or further assent from it, and that it will remain bound under this Article X notwithstanding any extension or renewal of any Guaranteed Obligation.

 

Each Guarantor waives presentation to, demand of payment from and protest to the Issuers of any of the Guaranteed Obligations and also waives notice of protest for nonpayment. Each Guarantor waives notice of any default under the Notes or the Guaranteed Obligations.

 

Each Guarantor further agrees that its Guarantee herein constitutes a Guarantee of payment when due (and not a Guarantee of collection) and waives any right to require that any resort be had by any Holder to any security held for payment of the Guaranteed Obligations.

 

Except as set forth in Section 10.2, the obligations of each Guarantor hereunder shall not be subject to any reduction, limitation, impairment or termination for any reason (other than payment of the Guaranteed Obligations in full), including any claim of waiver, release, surrender, alteration or compromise, and shall not be subject to any defense of setoff,

 

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counterclaim, recoupment or termination whatsoever or by reason of the invalidity, illegality or unenforceability of the Guaranteed Obligations or otherwise. Without limiting the generality of the foregoing, the Guaranteed Obligations of each Guarantor herein shall not be discharged or impaired or otherwise affected by (a) the failure of any Holder to assert any claim or demand or to enforce any right or remedy against the Issuers or any other person under this Indenture, the Notes or any other agreement or otherwise; (b) any extension or renewal of any thereof; (c) any rescission, waiver, amendment or modification of any of the terms or provisions of this Indenture, the Notes or any other agreement; (d) the release of any security held by any Holder for the Guaranteed Obligations; (e) the failure of any Holder to exercise any right or remedy against any other Guarantor; (f) any change in the ownership of the Issuers; (g) any default, failure or delay, willful or otherwise, in the performance of the Guaranteed Obligations; or (h) any other act or thing or omission or delay to do any other act or thing which may or might in any manner or to any extent vary the risk of any Guarantor or would otherwise operate as a discharge of such Guarantor as a matter of law or equity.

 

Each Guarantor agrees that its Guarantee herein shall remain in full force and effect until payment in full of all the Guaranteed Obligations or such Guarantor is released from its Guarantee in compliance with Section 10.2, Article VIII or Article XI. Each Guarantor further agrees that its Guarantee herein shall continue to be effective or be reinstated, as the case may be, if at any time payment, or any part thereof, of principal of, premium, if any, or interest on any of the Guaranteed Obligations is rescinded or must otherwise be restored by any Holder upon the bankruptcy or reorganization of the Issuers or otherwise.

 

In furtherance of the foregoing and not in limitation of any other right which any Holder has at law or in equity against any Guarantor by virtue hereof, upon the failure of the Issuers to pay any of the Guaranteed Obligations when and as the same shall become due, whether at maturity, by acceleration, by redemption or otherwise, each Guarantor hereby promises to and will, upon receipt of written demand by the Trustee, forthwith pay, or cause to be paid, in cash, to the Holders or the Trustee on behalf of the Holders an amount equal to the sum of (i) the unpaid amount of such Guaranteed Obligations then due and owing and (ii) accrued and unpaid interest on such Guaranteed Obligations then due and owing (but only to the extent not prohibited by law) (including interest accruing after the filing of any petition in bankruptcy or the commencement of any insolvency, reorganization or like proceeding relating to the Issuers or any Guarantor whether or not a claim for post-filing or post-petition interest is allowed in such proceeding).

 

Each Guarantor further agrees that, as between such Guarantor, on the one hand, and the Holders, on the other hand, (x) the maturity of the Guaranteed Obligations guaranteed hereby may be accelerated as provided in this Indenture for the purposes of its Guarantee herein, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the Guaranteed Obligations guaranteed hereby and (y) in the event of any such declaration of acceleration of such Guaranteed Obligations, such Guaranteed Obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantor for the purposes of this Guarantee.

 

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Each Guarantor also agrees to pay any and all fees, costs and expenses (including attorneys’ fees and expenses) incurred by the Trustee or the Holders in enforcing any rights under this Section.

 

Section 10.2          Limitation on Liability; Termination, Release and Discharge.

 

(a)           Any term or provision of this Indenture to the contrary notwithstanding, the obligations of each Guarantor hereunder will be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Guarantor and after giving effect to any collections from or payments made by or on behalf of any other Guarantor in respect of the obligations of such other Guarantor under its Guarantee or pursuant to its contribution obligations under this Indenture, result in the obligations of such Guarantor under its Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal, foreign or state law and not otherwise being void or voidable under any similar laws affecting the rights of creditors generally.

 

(b)           Any Guarantee of a Guarantor shall be automatically and unconditionally released and discharged upon:

 

(i)            other than in the case of Parent or any other direct or indirect parent of the Company, a sale or other disposition (including by way of consolidation or merger) of the Capital Stock of such Guarantor or the sale or disposition of all or substantially all the assets of the Guarantor (other than to the Company or a Restricted Subsidiary) otherwise permitted by this Indenture,

 

(ii)           the designation in accordance with this Indenture of the Guarantor as an Unrestricted Subsidiary or the occurrence of any event after which the Guarantor is no longer a Restricted Subsidiary,

 

(iii)          defeasance or discharge of the Notes, as provided in Articles VIII or XI, or

 

(iv)          to the extent that such Guarantor is not an Immaterial Subsidiary solely due to the operation of clause (i) of the definition of “Immaterial Subsidiary,” upon the release of the Guarantee referred to in such clause, or

 

(v)           such Guarantor being released from all of its obligations under all of its Guarantees of payment by the Company of any Non-Funding Indebtedness of the Company under all loan facilities and debt securities of the Company (it being understood that a release subject to reinstatement is considered a release); or

 

(vi)          upon the achievement of Investment Grade Status by the Notes; provided that such Guarantee shall be reinstated upon the Reversion Date.

 

Section 10.3          Right of Contribution. Each Guarantor hereby agrees that to the extent that any Guarantor shall have paid more than its proportionate share of any payment made on the obligations under the Guarantees, such Guarantor shall be entitled to seek and receive contribution from and against the Issuers or any other Guarantor who has not paid its

 

86

 

proportionate share of such payment. The provisions of this Section 10.3 shall in no respect limit the obligations and liabilities of each Guarantor to the Trustee and the Holders and each Guarantor shall remain liable to the Trustee and the Holders for the full amount guaranteed by such Guarantor hereunder.

 

Section 10.4          No Subrogation. Notwithstanding any payment or payments made by each Guarantor hereunder, no Guarantor shall be entitled to be subrogated to any of the rights of the Trustee or any Holder against the Issuers or any other Guarantor or any collateral security or guarantee or right of offset held by the Trustee or any Holder for the payment of the Guaranteed Obligations, nor shall any Guarantor seek or be entitled to seek any contribution or reimbursement from the Issuers or any other Guarantor in respect of payments made by such Guarantor hereunder, until all amounts owing to the Trustee and the Holders by the Issuers on account of the Guaranteed Obligations are paid in full. If any amount shall be paid to any Guarantor on account of such subrogation rights at any time when all of the Guaranteed Obligations shall not have been paid in full, such amount shall be held by such Guarantor in trust for the Trustee and the Holders, segregated from other funds of such Guarantor, and shall, forthwith upon receipt by such Guarantor, be turned over to the Trustee in the exact form received by such Guarantor (duly indorsed by such Guarantor to the Trustee, if required), to be applied against the Guaranteed Obligations.

 

ARTICLE XI

 

SATISFACTION AND DISCHARGE

 

Section 11.1          Satisfaction and Discharge. This Indenture will be discharged and will cease to be of further effect as to all Notes issued hereunder, when:

 

(a)           either:

 

(i)            all Notes that have been authenticated and delivered except lost, stolen or destroyed Notes that have been replaced or paid and Notes for whose payment money has theretofore been deposited in trust, have been delivered to the Trustee for cancellation; or

 

(ii)           all such Notes not theretofore delivered to the Trustee for cancellation (i) have become due and payable by reason of the making of a notice of redemption or otherwise or (ii) will become due and payable within one year at their Stated Maturity or (iii) are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the Trustee in the name, and at the expense, of the Company;

 

(b)           the Company has deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the Holders, cash or U.S. Government Obligations, or a combination thereof, in an amount sufficient to pay and discharge the entire indebtedness on the Notes not previously delivered to the Trustee for cancellation, for principal, premium, if any, and interest to the date of deposit (in the case of Notes that have become due and payable), or to the Stated Maturity or redemption date, as the case may be;

 

87

 

(c)           no Default or Event of Default (other than that resulting from borrowing funds to be applied to make such deposit and the granting of Liens in connection therewith) with respect to this Indenture or the Notes issued hereunder shall have occurred and be continuing on the date of such deposit or shall occur as a result of such deposit and such deposit will not result in a breach or violation of, or constitute a default under the Credit Facilities or any other material agreement or instrument (other than this Indenture) to which an Issuer or any Guarantor is a party or by which an Issuer or any Guarantor is bound;

 

(d)           the Company has paid or caused to be paid all other sums payable under this Indenture;

 

(e)           the Company has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of such notes issued hereunder at maturity or the Redemption Date, as the case may be; and

 

(f)            the Company has delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel each stating that all conditions precedent under Article XI relating to the satisfaction and discharge of this Indenture have been complied with; provided that any such counsel may rely on any Officer’s Certificate as to matters of fact (including as to compliance with clauses (a), (b) and (c)).

 

Notwithstanding the satisfaction and discharge of this Indenture, the provisions of Section 7.7 shall survive, and if money or U.S. Government Obligations have been deposited with the Trustee pursuant to clause (b) of this Section 11.1, the provisions of Sections 11.2 and 8.6 hereof will survive.

 

Section 11.2          Application of Trust Money. Subject to the provisions of Section 8.6 hereof, all money deposited with the Trustee pursuant to Section 11.1 hereof shall be held in trust and applied by it, in accordance with the provisions of the Notes and this Indenture, to the payment, either directly or through any Paying Agent (including the Issuers acting as their own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal (and premium, if any) and interest for whose payment such money has been deposited with the Trustee; but such money need not be segregated from other funds except to the extent required by law.

 

If the Trustee or Paying Agent is unable to apply any money or U.S. Government Obligations in accordance with Section 11.1 hereof by reason of any legal proceeding or by reason of any order or judgment of any court or Governmental Authority enjoining, restraining or otherwise prohibiting such application, the Issuers’ and any Guarantor’s obligations under this Indenture and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to Section 11.1 hereof; provided that if the Issuers have made any payment of principal of, premium, if any, or interest on, any Notes because of the reinstatement of its obligations, the Issuers shall be subrogated to the rights of the Holders of such Notes to receive such payment from the money or U.S. Government Obligations held by the Trustee or Paying Agent.

 

88

 

ARTICLE XII

 

MISCELLANEOUS

 

Section 12.1          [Reserved].

 

Section 12.2          Notices. Any notice, request, direction, consent or communication made pursuant to the provisions of this Indenture or the Notes shall be in writing and delivered in person, sent by facsimile, sent by electronic mail in pdf format, delivered by commercial courier service or mailed by first-class mail, postage prepaid, addressed as follows:

 

if to the Issuers:

 

Ladder Capital Finance Holdings LLLP
 Ladder Capital Finance Corporation
 345 Park Avenue, 8th Floor
 New York, New York 10154
 Attention: Marc Fox and Kelly Porcella
 Facsimile: (212) 715-3199

 

with a copy to:

 

Kirkland & Ellis LLP
 601 Lexington Avenue
 New York, New York 10022
 Attention: Joshua N. Korff
 Facsimile: (212) 446-4900

 

if to the Trustee, at its corporate trust office, which corporate trust office for purposes of this Indenture is at the date hereof located at:

 

Wilmington Trust, National Association
 Global Capital Markets
 50 South Sixth Street, Suite 1290
 Minneapolis, MN 55402-1544
 Attention: Ladder Capital Administrator
 Facsimile: (612) 217-5651

 

The Issuers or the Trustee by written notice to each other may designate additional or different addresses for subsequent notices or communications.

 

Any notice or communication to the Issuers or the Guarantors shall be deemed to have been given or made as of the date so delivered if personally delivered or if delivered electronically, in pdf format; when receipt is acknowledged, if telecopied; and five calendar days after mailing if sent by registered or certified mail, postage prepaid (except that a notice of change of address shall not be deemed to have been given until actually received by the addressee). Any notice or communication to the Trustee shall be deemed delivered upon receipt.

 

89

 

Any notice or communication sent to a Holder shall be mailed to the Holder at the Holder’s address as it appears in the Notes Register and shall be sufficiently given if so sent within the time prescribed.

 

Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders. If a notice or communication is sent in the manner provided above, it is duly given, whether or not the addressee receives it, except that notices to the Trustee shall be effective only upon receipt.

 

Notwithstanding any other provision of this Indenture or any Note, where this Indenture or any Note provides for notice of any event (including any notice of redemption or purchase) to a Holder of a Global Note (whether by mail or otherwise), such notice shall be sufficiently given if given to DTC (or its designee) pursuant to the procedures of DTC or its designee.

 

Section 12.3          [Reserved].

 

Section 12.4          Certificate and Opinion as to Conditions Precedent. Upon any request or application by the Issuers or any of the Guarantors to the Trustee to take or refrain from taking any action under this Indenture or the Notes, the Issuers or such Guarantor, as the case may be, shall furnish to the Trustee:

 

(i)            an Officer’s Certificate (which shall include the statements set forth in Section 12.5 hereof) stating that, in the opinion of the signers, all conditions precedent, if any, provided for in this Indenture or the Notes relating to the proposed action have been satisfied; and

 

(ii)           an Opinion of Counsel (which shall include the statements set forth in Section 12.5 hereof) stating that, in the opinion of such counsel, all such conditions precedent have been satisfied and all covenants have been complied with.

 

Section 12.5          Statements Required in Certificate or Opinion. Each certificate or opinion with respect to compliance with a covenant or condition provided for in this Indenture or the Notes shall include:

 

(i)            a statement that the individual making such certificate or opinion has read such covenant or condition;

 

(ii)           a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

 

(iii)          a statement that, in the opinion of such individual, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with; and

 

(iv)          a statement as to whether or not, in the opinion of such individual, such covenant or condition has been complied with. In giving such Opinion of Counsel,

 

90

 

counsel may rely as to factual matters on an Officer’s Certificate or on certificates of public officials.

 

Section 12.6          When Notes Disregarded. In determining whether the Holders of the required aggregate principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Issuers, any Guarantor or any Affiliate of them shall be disregarded and deemed not to be outstanding, except that, for the purpose of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes which a Trust Officer of the Trustee actually knows are so owned shall be so disregarded. Also, subject to the foregoing, only Notes outstanding at the time shall be considered in any such determination.

 

Section 12.7          Rules by Trustee, Paying Agent and Registrar. The Trustee may make reasonable rules for action by, or at meetings of, Holders. The Registrar and the Paying Agent may make reasonable rules for their functions.

 

Section 12.8          Legal Holidays. A “Legal Holiday” is a Saturday, a Sunday or other day on which commercial banking institutions are authorized or required to be closed in New York, New York or the jurisdiction of the place of payment. If a payment date or redemption date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a regular record date is a Legal Holiday, the record date shall not be affected.

 

Section 12.9          Governing Law. THIS INDENTURE, THE NOTES AND THE GUARANTEES SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.

 

Section 12.10       Jurisdiction. The Issuers and the Guarantors agree that any suit, action or proceeding against the Issuers or any Guarantor brought by any Holder or the Trustee arising out of or based upon this Indenture, the Guarantee or the Notes may be instituted in any state or Federal court in the Borough of Manhattan, New York, New York, and any appellate court from any thereof, and each of them irrevocably submits to the non-exclusive jurisdiction of such courts in any suit, action or proceeding. The Issuers and the Guarantors irrevocably waive, to the fullest extent permitted by law, any objection to any suit, action, or proceeding that may be brought in connection with this Indenture, the Guarantee or the Notes, including such actions, suits or proceedings relating to securities laws of the United States of America or any state thereof, in such courts whether on the grounds of venue, residence or domicile or on the ground that any such suit, action or proceeding has been brought in an inconvenient forum. The Issuers and the Guarantors agree that final judgment in any such suit, action or proceeding brought in such court shall be conclusive and binding upon the Issuers or the Guarantors, as the case may be, and may be enforced in any court to the jurisdiction of which the Issuers or the Guarantors, as the case may be, are subject by a suit upon such judgment.

 

Section 12.11       Waivers of Jury Trial. EACH OF THE ISSUERS, THE GUARANTORS AND THE TRUSTEE HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR

 

91

 

RELATING TO THIS INDENTURE, THE NOTES OR THE GUARANTEES AND FOR ANY COUNTERCLAIM THEREIN.

 

Section 12.12       USA PATRIOT Act. The parties hereto acknowledge that in accordance with Section 326 of the USA PATRIOT Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify, and record information that identifies each person or legal entity that establishes a relationship or opens an account. The parties to this Indenture agree that they will provide the Trustee with such information as it may request in order to satisfy the requirements of the USA PATRIOT Act.

 

Section 12.13       No Recourse Against Others. No director, officer, employee, incorporator or shareholder of any Issuer or any of its Subsidiaries or Affiliates, or such (other than the Issuers and the Guarantors), shall have any liability for any obligations of the Issuers or the Guarantors under the Notes, the Guarantees or this Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy.

 

Section 12.14       Successors. All agreements of the Issuers and each Guarantor in this Indenture and the Notes shall bind their respective successors. All agreements of the Trustee in this Indenture shall bind its successors.

 

Section 12.15       Multiple Originals. The parties may sign any number of copies of this Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Indenture as to the parties hereto and may be used in lieu of the original Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

 

Section 12.16       [Reserved]

 

Section 12.17       Table of Contents; Headings. The table of contents, cross-reference table and headings of the Articles and Sections of this Indenture have been inserted for convenience of reference only, are not intended to be considered a part hereof and shall not modify or restrict any of the terms or provisions hereof.

 

Section 12.18       Force Majeure. In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services, it being understood that the Trustee shall use reasonable best efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

92

 

Section 12.19       Severability. In case any provision in this Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

Section 12.20       [Reserved]

 

Section 12.21       [Reserved]

 

Section 12.22       Waiver of Immunities. To the extent that Issuers or any Guarantor or any of its properties, assets or revenues may have or may hereafter become entitled to, or have attributed to them, any right of immunity, on the grounds of sovereignty, from any legal action, suit or proceeding, from set-off or counterclaim, from the jurisdiction of any court, from service of process, from attachment upon or prior to judgment, or from attachment in aid of execution of judgment, or from execution of judgment, or other legal process or proceeding for the giving of any relief or for the enforcement of any judgment, in any jurisdiction in which proceedings may at any time be commenced, with respect to their obligations, liabilities or any other matter under or arising out of or in connection with this Indenture, the Notes or the Guarantees, the Issuers and each Guarantor hereby irrevocably and unconditionally, to the extent permitted by applicable law, waives and agrees not to plead or claim any such immunity and consents to such relief and enforcement.

 

Section 12.23       Judgment Currency. The Issuers and each Guarantor agrees to indemnify the recipient against any loss incurred by such recipient as a result of any judgment or order being given or made against the Issuers or any Guarantor for any amount due hereunder and such judgment or order being expressed and paid in a currency (the “Judgment Currency”) other than United States dollars and as a result of any variation as between (i) the rate of exchange at which the United States dollar amount is converted into the Judgment Currency for the purpose of such judgment or order, and (ii) the rate of exchange in The City of New York at which such party on the date of payment of such judgment or order is able to purchase United States dollars with the amount of the Judgment Currency actually received by such party if such party had utilized such amount of Judgment Currency to purchase United States dollars as promptly as practicable upon such party’s receipt thereof. The foregoing indemnity shall constitute a separate and independent obligation of the Issuers and each Guarantor and shall continue in full force and effect notwithstanding any such judgment or order as aforesaid. The term “rate of exchange” shall include any premiums and costs of exchange payable in connection with the purchase of, or conversion into, the relevant currency.

 

[Signature on following pages]

 

93

 

IN WITNESS WHEREOF, the parties have caused this Indenture to be duly executed all as of the date and year first written above.

 

	
 
    	
LADDER CAPITAL FINANCE HOLDINGS   LLLP
    	
 

	
 
    	
 
    	
 

	
 
    	
 
    	
 
    
	
 
    	
By: 
    	
/s/ Pamela McCormack
    
	
 
    	
Name: 
    	
Pamela McCormack
    
	
 
    	
Title:
    	
Authorized Person
    
	
 
    	
 
    	
 

	
 
    	
 
    	
 

	
 
    	
LADDER CAPITAL FINANCE   CORPORATION
    	
 

	
 
    	
 
    	
 
    	
 

	
 
    	
 
    	
 
    	
 

	
 
    	
By: 
    	
/s/ Pamela McCormack
    	
 

	
 
    	
Name: 
    	
Pamela McCormack
    	
 

	
 
    	
Title:
    	
Secretary
    	
 

	
 
    	
 
    	
 

	
 
    	
 
    	
 

	
 
    	
LADDER CAPITAL CORP
    	
 

	
 
    	
 
    	
 

	
 
    	
 
    	
 

	
 
    	
By: 
    	
/s/ Pamela McCormack
    	
 

	
 
    	
Name: 
    	
Pamela McCormack
    	
 

	
 
    	
Title:
    	
President
    	
 

 

[Signature Page to Indenture]

 

 

	
 
    	
Each as a Guarantor:
    
	
 
    	
 
    
	
 
    	
LADDER MIDCO LLC
    
	
 
    	
LADDER MIDCO II LLC
    
	
 
    	
LADDER MEMBER CORPORATION
    
	
 
    	
LADDER CAPITAL FINANCE   PORTFOLIO LLC
    
	
 
    	
LCR INCOME I LP LLC
    
	
 
    	
LADDER CAPITAL REALTY II LLC
    
	
 
    	
LADDER CAPITAL FINANCE   PORTFOLIO II LLC
    
	
 
    	
LADDER CAPITAL FINANCE LLC
    
	
 
    	
LADDER CAPITAL CRE EQUITY LLC
    
	
 
    	
LADDER GRACE LAKE MEMBER LLC
    
	
 
    	
ONP JV MEMBER LLC
    
	
 
    	
LVT JV MEMBER LLC
    
	
 
    	
IOP JV MEMBER LLC
    
	
 
    	
ONP ROOFTOP JV MEMBER LLC
    
	
 
    	
LAFAYETTE PARK JV MEMBER LLC
    
	
 
    	
SERIES REIT OF LADDER MIDCO LLC
    
	
 
    	
SERIES TRS OF LADDER MIDCO LLC
    
	
 
    	
SERIES REIT OF LADDER MIDCO II   LLC
    
	
 
    	
SERIES TRS OF LADDER MIDCO II   LL
    
	
 
    	
SERIES REIT OF LADDER CAPITAL   FINANCE HOLDINGS LLLP
    
	
 
    	
SERIES TRS OF LADDER CAPITAL FINANCE   HOLDINGS LLLP
    
	
 
    	
LC TRS I LLC
    
	
 
    	
LC TRS III LLC
    
	
 
    	
LADDER CAPITAL INSURANCE LLC
    
	
 
    	
GRAND RAPIDS JV MEMBER LLC
    
	
 
    	
PELHAM JV MEMBER LLC
    
	
 
    	
TUEBOR TRS IV LLC
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By: 
    	
/s/ Kelly Porcella
    
	
 
    	
Name: 
    	
Kelly Porcella
    
	
 
    	
Title:
    	
General Counsel and/or   Authorized Person
    

 

[Signature Page to Indenture]

 

 

	
 
    	
WILMINGTON TRUST, NATIONAL   ASSOCIATION, AS TRUSTEE
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By: 
    	
/s/ Jane Y. Schweiger
    
	
 
    	
Name: 
    	
Jane Y. Schweiger
    
	
 
    	
Title:
    	
Vice President
    

 

[Signature Page to Indenture]

 

 

EXHIBIT A

 

[FORM OF FACE OF GLOBAL RESTRICTED NOTE]

 

[Applicable Restricted Notes Legend]

 

[Depository Legend, if applicable]

 

	
No. [   ]
    	
Principal Amount   $[           ]
    
	
 
    	
 
    
	
 
    	
(as revised by the Schedule of Increases and Decreases in Global Notes   attached hereto)
    
	
 
    	
 
    
	
 
    	
CUSIP NO.
    	
 
    

 

LADDER CAPITAL FINANCE HOLDINGS LLLP

 

and

 

LADDER CAPITAL FINANCE CORPORATION

 

5.250% Senior Notes due 2025

 

Ladder Capital Finance Holdings LLLP, a Delaware limited liability limited partnership, and Ladder Capital Finance Corporation, a Delaware corporation, jointly and severally, promise to pay to Cede & Co., or its registered assigns, the principal sum of                 dollars (as revised by the Schedule of Increases and Decreases in Global Notes attached hereto), on October 1, 2025.

 

Interest Payment Dates: April 1 and October 1, commencing on April 1, 2018

 

Record Dates: March 15 and September 15

 

Additional provisions of this Note are set forth on the other side of this Note.

 

 

IN WITNESS WHEREOF, the Issuers have caused this instrument to be duly executed.

 

	
 
    	
LADDER CAPITAL FINANCE HOLDINGS   LLLP
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
LADDER CAPITAL FINANCE   CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

A-2

 

TRUSTEE CERTIFICATE OF AUTHENTICATION

 

This Note is one of the Notes referred to in the within-mentioned Indenture.

 

	
 
    	
WILMINGTON TRUST, NATIONAL ASSOCIATION,
    
	
 
    	
as Trustee
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
Dated:
    	
 
    	
 
    
				

 

A-3

 

[FORM OF REVERSE SIDE OF NOTE]

 

LADDER CAPITAL FINANCE HOLDINGS LLLP
 and
 LADDER CAPITAL FINANCE CORPORATION

 

5.250% Senior Notes due 2025

 

Capitalized terms used herein and not defined herein have the meanings ascribed thereto in the Indenture.

 

1.                                      Interest

 

Ladder Capital Finance Holdings LLLP, a Delaware limited liability limited partnership, and Ladder Capital Finance Corporation, a Delaware corporation, jointly and severally, promise to pay interest on the principal amount of this Note at 5.250% per annum from September 25, 2017, until maturity. The Issuers will pay interest semi-annually in arrears every April 1 and October 1 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each, an “Interest Payment Date”). Interest on the Notes shall accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided, that the first Interest Payment Date shall be April 1, 2018. The Issuers shall pay interest on overdue principal at the rate specified herein, and it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace period) at the same rate to the extent lawful. Interest on the Notes will be computed on the basis of a 360-day year comprised of twelve 30-day months.

 

2.                                      Method of Payment

 

By no later than 10:00 a.m. (New York City time) on the date on which any principal of, premium, if any, or interest on any Note is due and payable, the Issuers shall deposit with the Paying Agent a sum sufficient in immediately available funds to pay such principal, premium and interest when due. Interest on any Note which is payable, and is timely paid or duly provided for, on any Interest Payment Date shall be paid to the Person in whose name such Note (or one or more Predecessor Notes) is registered at the close of business on the preceding March 15 and September 15 at the office or agency of the Issuers maintained for such purpose pursuant to Section 2.3 of the Indenture. The principal of (and premium, if any) and interest on the Notes shall be payable at the office or agency of Paying Agent or Registrar designated by the Issuers maintained for such purpose (which shall initially be the office of the Trustee maintained for such purpose), or at such other office or agency of the Issuers as may be maintained for such purpose pursuant to Section 2.3 of the Indenture; provided, however, that, at the option of the Paying Agent, each installment of interest may be paid by (i) check mailed to addresses of the Persons entitled thereto as such addresses shall appear on the Notes Register or (ii) wire transfer to an account located in the United States maintained by the payee, subject to the last sentence of this paragraph. Payments in respect of Notes represented by a Global Note (including principal, premium, if any, and interest) will be made by wire transfer of immediately available funds to the accounts specified by The Depository Trust Company or any successor depository. Payments in respect of Notes represented by Definitive Notes (including principal, premium, if any, and interest) held by a Holder of at least $1,000,000 aggregate principal amount of Notes represented by Definitive Notes will be made by wire transfer to a U.S. dollar account maintained by the payee with a bank in the United States if such Holder elects payment by wire transfer by giving written notice to the Trustee or the Paying Agent to such effect designating such account no later than 15 days immediately preceding the relevant due date for payment (or such other date as the Trustee may accept in its discretion). If an Interest Payment Date or a Redemption Date is a Legal Holiday, payment shall be made on the next succeeding day that is not a Legal Holiday, and no interest shall accrue for the intervening period. If a regular record date is a Legal Holiday, the record date shall not be affected.

 

3.                                      Paying Agent and Registrar

 

The Issuers initially appoint Wilmington Trust, National Association (the “Trustee”) as Registrar and Paying Agent for the Notes. The Issuers may change any Registrar or Paying Agent without prior notice to the Holders. The Issuers or any Guarantor may act as Paying Agent, Registrar or transfer agent.

 

A-4

 

4.                                      Indenture

 

The Issuers issued the Notes under an Indenture, dated as of September 25, 2017 (as it may be amended or supplemented from time to time in accordance with the terms thereof, the “Indenture”), among the Issuers and the Trustee. The terms of the Notes include those stated in the Indenture. The Notes are subject to all terms and provisions of the Indenture, and Holders are referred to the Indenture for a statement of those terms.  If any term in this Note conflicts with the Indenture, the terms of the Indenture shall govern and control.

 

5.                                      [Reserved]

 

6.                                      [Reserved]

 

7.                                      Redemption

 

(a)                                 At any time prior to October 1, 2020, the Issuers may redeem the Notes in whole or in part, at their option, upon not less than 15 nor more than 60 days’ prior notice by electronic delivery or by first class mail, postage prepaid, with a copy to the Trustee, to each Holder of Notes to the address of such Holder appearing in the Notes Register, at a redemption price equal to 100% of the principal amount of such Notes redeemed plus the Applicable Premium as of, and accrued and unpaid interest, if any, to, but not including, the date of redemption (the “Redemption Date”), subject to the rights of holders of the Notes on the relevant record date to receive interest due on the relevant interest payment date.

 

(b)                                 At any time and from time to time on or after October 1, 2020, the Issuers may redeem the Notes, in whole or in part, at their option, upon not less than 15 nor more than 60 days’ notice at the following redemption prices (expressed as a percentage of principal amount), plus accrued and unpaid interest, if any, to, but not including, the Redemption Date, subject to the right of holders of record on the relevant record date to receive interest due on the relevant interest payment date, if redeemed during the twelve month period beginning on October 1 of the year set forth below:

 

	
Redemption period
    	
 
    	
Price
    	
 
    
	
2020
    	
 
    	
102.625
    	
%
    
	
2021
    	
 
    	
101.313
    	
%
    
	
2022 and   thereafter
    	
 
    	
100.000
    	
%
    

 

(c)                                  At any time and from time to time prior to October 1, 2020, the Issuers may redeem Notes with the net cash proceeds received by the Issuers from any Equity Offering at a redemption price equal to 105.250% plus accrued and unpaid interest, if any, to, but not including, the Redemption Date, in an aggregate principal amount for all such redemptions not to exceed 35% of the original aggregate principal amount of the Notes (including Additional Notes); provided that (1) in each case the redemption takes place not later than 180 days after the closing of the related Equity Offering, and (2) not less than 50% of the original aggregate principal amount of the Notes issued under this Indenture remains outstanding immediately thereafter (excluding Notes held by the Issuers or any of their Restricted Subsidiaries). The Trustee shall select the Notes to be purchased in the manner described under Sections 5.1 through 5.6 of the Indenture.

 

(d)                                 Unless the Issuers default in the payment of the redemption price, interest will cease to accrue on the Notes or portions thereof called for redemption on the applicable Redemption Date.

 

(e)                                  Any redemption pursuant to this paragraph shall be made pursuant to the provisions of Sections 5.1 through 5.6 of the Indenture.

 

The Issuers are not required to make mandatory redemption or sinking fund payments with respect to the Notes; provided however, that under certain circumstances, the Issuers may be required to offer to purchase Notes under Section 3.5 of the Indenture. The Issuers may at any time and from time to time purchase Notes in open-market transactions, tender offers or otherwise.

 

A-5

 

8.                                      Repurchase Provisions

 

If a Change of Control Repurchase Event occurs, each Holder will have the right to require the Issuers to repurchase from each Holder all or any part (equal to a minimum of $2,000 or an integral multiple of $1,000 in excess thereof) of such Holder’s Notes at a purchase price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest, if any, to but excluding the date of purchase, subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date as provided in, and subject to the terms of, the Indenture.

 

9.                                      Denominations; Transfer; Exchange

 

The Notes shall be issuable only in fully registered form in denominations of minimum principal amount of $2,000 and any integral multiple of $1,000 in excess thereof. A Holder may transfer or exchange Notes in accordance with the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements or transfer documents and to pay a sum sufficient to cover any tax and fees required by law or permitted by the Indenture. Neither the Issuers nor the Registrar need register the transfer of or exchange of any Note (A) for a period beginning (1) 15 days before the mailing of a notice of an offer to repurchase or redeem Notes and ending at the close of business on the day of such mailing or (2) 15 days before an Interest Payment Date and ending on such Interest Payment Date or (B) called for redemption, except the unredeemed portion of any Note being redeemed in part.

 

10.                               Persons Deemed Owners

 

The registered Holder of this Note may be treated as the owner of it for all purposes.

 

11.                               [Reserved]

 

12.                               Discharge and Defeasance

 

Subject to certain exceptions and conditions set forth in the Indenture, the Issuers at any time may terminate some or all of its obligations under the Notes and the Indenture if the Issuers deposit with the Trustee money or U.S. Government Obligations for the payment of principal, premium, and interest on the Notes to redemption or maturity, as the case may be.

 

13.                               Amendment, Supplement, Waiver

 

Subject to certain exceptions contained in the Indenture, the Indenture and the Notes may be amended, or a Default thereunder may be waived, with the consent of the Holders of a majority in aggregate principal amount of the outstanding Notes. Without notice to or the consent of any Holder, the Issuers, the Guarantors and the Trustee may amend or supplement the Indenture and the Notes as provided in the Indenture.

 

14.                               Defaults and Remedies

 

If an Event of Default (other than an Event of Default relating to certain events of bankruptcy, insolvency or reorganization of the Issuers or certain Guarantors) occurs and is continuing, the Trustee by notice to the Issuers, or the Holders of at least 30% in principal amount of the outstanding Notes by notice to the Issuers and the Trustee, may declare the principal of, premium, if any, and accrued and unpaid interest, and any other monetary obligations on all the Notes to be due and payable immediately. Upon the effectiveness of such declaration, such principal, premium, interest, if any, and other monetary obligations will be due and payable immediately. If a bankruptcy, insolvency or reorganization of the Issuers or certain Guarantors occurs and is continuing, the principal of, premium, if any, and accrued and unpaid interest and any other monetary obligations on all the Notes will become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holders. Under certain circumstances, the Holders of a majority in principal amount of the outstanding Notes may rescind any such acceleration with respect to the Notes and its consequences.

 

A-6

 

15.                               Trustee Dealings with the Issuers

 

Subject to certain limitations set forth in the Indenture, the Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuers, Guarantors or their Affiliates with the same rights it would have if it were not Trustee. In addition, the Trustee shall be permitted to engage in transactions with the Issuers.

 

16.                               No Recourse Against Others

 

No director, officer, employee, incorporator or shareholder of the Issuers or any of its Subsidiaries or Affiliates, as such (other than the Issuers and the Guarantors), shall have any liability for any obligations of the Issuers or the Guarantors under the Notes, the Guarantees or the Indenture or for any claim based on, in respect of, or by reason of such obligations or their creation. Each Holder by accepting a note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes. Such waiver may not be effective to waive liabilities under the federal securities laws and it is the view of the SEC that such a waiver is against public policy.

 

17.                               Authentication

 

This Note shall not be valid until an authorized signatory of the Trustee (or an authenticating agent acting on its behalf) manually signs the certificate of authentication on the other side of this Note.

 

18.                               Abbreviations

 

Customary abbreviations may be used in the name of a Holder or an assignee, such as TEN COM (= tenants in common), TEN ENT (= tenants by the entirety), JT TEN (= joint tenants with rights of survivorship and not as tenants in common), CUST (= custodian) and U/G/M/A (= Uniform Gift to Minors Act).

 

19.                               CUSIP and ISIN Numbers

 

The Issuers have caused CUSIP and ISIN numbers, if applicable, to be printed on the Notes and have directed the Trustee to use CUSIP and ISIN numbers, if applicable, in notices of redemption or purchase as a convenience to Holders. No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption or purchase and reliance may be placed only on the other identification numbers placed thereon.

 

20.                               Governing Law

 

This Note shall be governed by, and construed in accordance with, the laws of the State of New York.

 

The Issuers will furnish to any Holder upon written request and without charge to the Holder a copy of the Indenture. Requests may be made to:

 

Ladder Capital Finance Holdings LLLP
 Ladder Capital Finance Corporation
 345 Park Avenue, 8th Floor
 New York, New York 10154
 Attention: Marc Fox and Kelly Porcella
 Facsimile: (212) 715-3199

 

A-7

 

ASSIGNMENT FORM

 

To assign this Note, fill in the form below:

 

I or we assign and transfer this Note to:

 

 

(Print or type assignee’s name, address and zip code)

 

 

(Insert assignee’s social security or tax I.D. No.)

 

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

 

	
Date:
    	
Your Signature:
    	
 
    

 

	
Signature Guarantee:
    	
 
    
	
 
    	
(Signature must be guaranteed)
    
	
 
    
	
Sign exactly as your name appears on the other side of this Note.
    

 

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17Ad-15.

 

The undersigned hereby certifies that it o is / o is not an Affiliate of the Issuers and that, to its knowledge, the proposed transferee o is / o is not an Affiliate of the Issuers.

 

In connection with any transfer or exchange of any of the Notes evidenced by this certificate occurring prior to the date that is one year after the later of the date of original issuance of such Notes and the last date, if any, on which such Notes were owned by the Issuers or any Affiliate of the Issuers, the undersigned confirms that such Notes are being:

 

CHECK ONE BOX BELOW:

 

(1)                                 o                                    acquired for the undersigned’s own account, without transfer; or

 

(2)                                 o                                    transferred to the Issuers; or

 

(3)                                 o                                    transferred pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”); or

 

(4)                                 o                                    transferred pursuant to an effective registration statement under the Securities Act; or

 

(5)                                 o                                    transferred pursuant to and in compliance with Regulation S under the Securities Act; or

 

(6)                                 o                                    transferred to an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) or an “accredited investor” (as defined in Rule 501(a)(4) under the Securities Act), that has furnished to the Trustee a signed letter containing certain representations and agreements (the form of which letter appears as Section 2.8 or 2.10 of the Indenture, respectively); or

 

A-8

 

(7)                                 o                                    transferred pursuant to another available exemption from the registration requirements of the Securities Act of 1933, as amended.

 

Unless one of the boxes is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if box (5), (6) or (7) is checked, the Issuers may require, prior to registering any such transfer of the Notes, in its sole discretion, such legal opinions, certifications and other information as the Issuers may reasonably request to confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act of 1933, as amended, such as the exemption provided by Rule 144 under such Act.

 

	
 
    	
 
    	
 
    
	
 
    	
 
    	
Signature
    
	
 
    	
 
    	
 
    
	
Signature Guarantee:

 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
(Signature must be guaranteed)
    	
 
    	
Signature
    

 

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17Ad-15.

 

TO BE COMPLETED BY PURCHASER IF BOX (1) OR (3) ABOVE IS CHECKED.

 

The undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act of 1933, as amended, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Issuers as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the exemption from registration provided by Rule 144A.

 

	
 
    	
 
    
	
 
    	
Dated:
    

 

A-9

 

SCHEDULE OF INCREASES OR DECREASES IN GLOBAL NOTES

 

The following increases or decreases in this Global Note have been made:

 

	
Date of Exchange
    	
 
    	
Amount of decrease

in Principal Amount

of this Global Note
    	
 
    	
Amount of increase

in Principal Amount

of this Global Note
    	
 
    	
Principal Amount of

this Global Note

following such

decrease or increase
    	
 
    	
Signature of

authorized signatory

of Trustee or Notes

Custodian
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

A-10

 

OPTION OF HOLDER TO ELECT PURCHASE

 

If you elect to have this Note purchased by the Issuers pursuant to Section 3.5 of the Indenture, check the box:

 

Section 3.5 o

 

If you want to elect to have only part of this Note purchased by the Issuers pursuant to Section 3.5 of the Indenture, state the amount in principal amount (must be in denominations of $2,000 or an integral multiple of $1,000 in excess thereof): $                                    and specify the denomination or denominations (which shall not be less than the minimum authorized denomination) of the Notes to be issued to the Holder for the portion of the within Note not being repurchased (in the absence of any such specification, one such Note will be issued for the portion not being repurchased):                  .

 

	
Date: 
    	
           
    	
 Your Signature
    	
 
    	
 
    
	
 
    	
(Sign exactly as your name appears on the other side of the Note)
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Signature Guarantee:
    	
 
    	
 
    
	
 
    	
(Signature must be guaranteed)
    	
 
    
							

 

The signature(s) should be guaranteed by an eligible guarantor institution (banks, stockbrokers, savings and loan associations and credit unions with membership in an approved signature guarantee medallion program), pursuant to Exchange Act Rule 17Ad-15.

 

A-11

 

EXHIBIT B

 

Form of Supplemental Indenture to Add Guarantors

 

SUPPLEMENTAL INDENTURE, (this “Supplemental Indenture”) dated as of               , 20   , by and among the parties that are signatories hereto as Guarantors (the “Guaranteeing Subsidiary”), and Wilmington Trust, National Association, as Trustee under the Indenture referred to below.

 

W I T N E S S E T H:

 

WHEREAS, each of the Issuers and the Trustee have heretofore executed and delivered an indenture dated as of September 25, 2017 (as amended, supplemented, waived or otherwise modified, the “Indenture”), providing for the issuance of an aggregate principal amount of $400.0 million of 5.250% Senior Notes due 2025 (the “Notes) of the Issuers (as defined in the Indenture);

 

WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture to which the Guaranteeing Subsidiary shall unconditionally guarantee, on a joint and several basis with the other Guarantors, all of the Issuers’ Obligations under the Notes and the Indenture on the terms and conditions set forth herein and under the Indenture (the “Guarantee”); and

 

WHEREAS, pursuant to Section 9.1 of the Indenture, the Issuers, any Guarantor and the Trustee are authorized to execute and deliver this Supplemental Indenture to amend or supplement the Indenture, without the consent of any Holder;

 

NOW, THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary, the Issuers, the other Guarantors and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows:

 

ARTICLE I

 

DEFINITIONS

 

SECTION 1.1.      Defined Terms. As used in this Supplemental Indenture, terms defined in the Indenture or in the preamble or recitals hereto are used herein as therein defined. The words “herein,” “hereof” and “hereby” and other words of similar import used in this Supplemental Indenture refer to this Supplemental Indenture as a whole and not to any particular section hereof.

 

ARTICLE II

 

AGREEMENT TO BE BOUND; GUARANTEE

 

SECTION 2.1.      Agreement to be Bound. The Guaranteeing Subsidiary hereby becomes a party to the Indenture as a Guarantor and as such will have all of the rights and be subject to all of the obligations and agreements of a Guarantor under the Indenture.

 

SECTION 2.2.      Guarantee. The Guaranteeing Subsidiary agrees, on a joint and several basis with all the existing Guarantors, to fully, unconditionally and irrevocably Guarantee to each Holder of the Notes and the Trustee the Guaranteed Obligations pursuant to Article X of the Indenture on a senior basis.

 

 

ARTICLE III

 

MISCELLANEOUS

 

SECTION 3.1.      Notices. All notices and other communications to the Guarantor shall be given as provided in the Indenture to the Guarantor, at its address set forth below, with a copy to the Issuers as provided in the Indenture for notices to the Issuers.

 

SECTION 3.2.      Merger and Consolidation. The Guaranteeing Subsidiary shall not sell or otherwise dispose of all or substantially all of its assets to, or consolidate with or merge with or into another Person (other than the Issuers or any Restricted Subsidiary that is a Guarantor or becomes a Guarantor concurrently with the transaction) except in accordance with Section 4.1(d) of the Indenture.

 

SECTION 3.3.      Release of Guarantee. This Guarantee shall be released in accordance with Section 10.2 of the Indenture.

 

SECTION 3.4.      Parties. Nothing expressed or mentioned herein is intended or shall be construed to give any Person, firm or corporation, other than the Holders and the Trustee, any legal or equitable right, remedy or claim under or in respect of this Supplemental Indenture or the Indenture or any provision herein or therein contained.

 

SECTION 3.5.      Governing Law. This Supplemental Indenture shall be governed by, and construed in accordance with, the laws of the State of New York.

 

SECTION 3.6.      Severability. In case any provision in this Supplemental Indenture shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby and such provision shall be ineffective only to the extent of such invalidity, illegality or unenforceability.

 

SECTION 3.7.      Benefits Acknowledged. The Guaranteeing Subsidiary’s Guarantee is subject to the terms and conditions set forth in the Indenture. The Guaranteeing Subsidiary acknowledges that it will receive direct and indirect benefits from the financing arrangements contemplated by the Indenture and this Supplemental Indenture and that the guarantee and waivers made by it pursuant to this Guarantee are knowingly made in contemplation of such benefits.

 

SECTION 3.8.      Ratification of Indenture; Supplemental Indentures Part of Indenture. Except as expressly amended hereby, the Indenture is in all respects ratified and confirmed and all the terms, conditions and provisions thereof shall remain in full force and effect. This Supplemental Indenture shall form a part of the Indenture for all purposes, and every Holder of Notes heretofore or hereafter authenticated and delivered shall be bound hereby.

 

SECTION 3.9.      The Trustee. The Trustee makes no representation or warranty as to the validity or sufficiency of this Supplemental Indenture or with respect to the recitals contained herein, all of which recitals are made solely by the other parties hereto.

 

SECTION 3.10.    Counterparts. The parties hereto may sign any number of copies of this Supplemental Indenture. Each signed copy shall be an original, but all of them together represent the same agreement. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture for all purposes. Signatures of the parties hereto transmitted by facsimile or PDF shall be deemed to be their original signatures for all purposes.

 

SECTION 3.11.    Execution and Delivery. The Guaranteeing Subsidiary agrees that the Guarantee shall remain in full force and effect notwithstanding any failure to endorse on each Note a notation of any such Guarantee.

 

B-2

 

SECTION 3.12.    Headings. The headings of the Articles and the Sections in this Supplemental Indenture are for convenience of reference only and shall not be deemed to alter or affect the meaning or interpretation of any provisions hereof.

 

B-3

 

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

 

	
 
    	
[SUBSIDIARY   GUARANTOR],
    
	
 
    	
as a Guarantor
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    	
 
    
	
 
    	
[ADDRESS   FOR NOTICES]
    

 

 

[Signature Page to Supplemental Indenture]

 

 

	
Acknowledged   by:
    	
 
    
	
 
    	
 
    
	
LADDER   CAPITAL FINANCE HOLDINGS LLLP
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
LADDER   CAPITAL FINANCE CORPORATION
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
				

 

[Signature Page to Supplemental Indenture]

 

 

	
 
    	
WILMINGTON   TRUST, NATIONAL ASSOCIATION,
    
	
 
    	
as   Trustee
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

[Signature Page to Supplemental Indenture]EX-4.6

 Exhibit 4.6 
  

 
  

BANCO BILBAO VIZCAYA ARGENTARIA, S.A., 

as Issuer 
 THE BANK OF NEW YORK
MELLON, 
 as Trustee, Paying and Conversion Agent and Principal Paying Agent 

THE BANK OF NEW YORK MELLON, 
 as
Contingent Convertible Preferred Security Registrar 
  

 
 INDENTURE 

 
  

Dated as of September 25, 2017 

Contingent Convertible Preferred Securities 
  

 
  

 

 Reconciliation and tie between 

Trust Indenture Act of 1939, as amended 

and this Contingent Convertible Preferred Securities Indenture 
  

			
	 Trust Indenture

Act Section
	  	 Contingent Convertible Preferred Securities

Indenture Section

	 §310 (a)(1)
	  	 7.10

	 (a)(2)
	  	 7.10

	 (a)(3)
	  	 Not Applicable

	 (a)(4)
	  	 Not Applicable

	 (b)
	  	 7.09, 7.11

	 §311(a)
	  	 7.14

	 (b)
	  	 7.14

	 §312(a)
	  	 8.01, 8.02(a)

	 (b)
	  	 8.02(b)

	 (c)
	  	 8.02(c)

	 §313(a)
	  	 8.03(a)

	 (b)
	  	 8.03(a)

	 (c)
	  	 1.06, 8.03(a)

	 (d)
	  	 8.03(b)

	 §314(a)
	  	 8.04, 11.06

	 (b)
	  	 Not Applicable

	 (c)(1)
	  	 1.02

	 (c)(2)
	  	 1.02

	 (c)(3)
	  	 Not Applicable

	 (d)
	  	 Not Applicable

	 (e)
	  	 1.02

	 (f)
	  	 Not Applicable

	 §315(a)
	  	 7.01

	 (b)
	  	 7.03, 8.03(a)

	 (c)
	  	 7.01

	 (d)
	  	 7.01

	 (d)(1)
	  	 7.01

	 (d)(2)
	  	 7.01

	 (d)(3)
	  	 7.01

	 (e)
	  	 6.15

	 §316(a)(1)(A)
	  	 6.14

	 (a)(l)(B)
	  	 6.16

	 (a)(2)
	  	 Not Applicable

	 (a)(last sentence)
	  	 1.01

	 (b)
	  	 6.10

	 (c)
	  	 Not Applicable

	 §317(a)(1)
	  	 6.04

	 (a)(2)
	  	 6.06

	 (b)
	  	 11.03

	 §318(a)
	  	 1.08

  

Note: This reconciliation and tie shall not, for any purpose, be deemed to be part of this Contingent Convertible Preferred
Securities Indenture. 

  
 i 

 TABLE OF CONTENTS 

 
  

 

					
	 	  	PAGE	 
	ARTICLE 1	  			
	DEFINITIONS AND OTHER PROVISIONS OF GENERAL APPLICATION	  			
		
	 Section 1.01. Definitions
	  	 	1	 
	 Section 1.02. Compliance Certificates and Opinions
	  	 	17	 
	 Section 1.03. Form of Documents Delivered to Trustee
	  	 	17	 
	 Section 1.04. Acts of Holders
	  	 	17	 
	 Section 1.05. Notices, Etc. to Trustee and Company
	  	 	19	 
	 Section 1.06. Notice to Holders; Waiver
	  	 	19	 
	 Section 1.07. Language of Notices, Etc.
	  	 	20	 
	 Section 1.08. Conflict with Trust Indenture Act
	  	 	20	 
	 Section 1.09. Effect of Headings and Table of Contents
	  	 	20	 
	 Section 1.10. Successors and Assigns
	  	 	20	 
	 Section 1.11. Separability Clause
	  	 	20	 
	 Section 1.12. Benefits of Contingent Convertible Preferred Securities
Indenture
	  	 	20	 
	 Section 1.13. Governing Law
	  	 	21	 
	 Section 1.14. Business Days
	  	 	21	 
	 Section 1.15. Appointment of Agent for Service
	  	 	21	 
	 Section 1.16. Calculation Agent
	  	 	21	 
	 Section 1.17. Waiver of Jury Trial
	  	 	21	 
	 Section 1.18. Judgment Currency
	  	 	22	 
		
	ARTICLE 2	  			
	CONTINGENT CONVERTIBLE PREFERRED SECURITY FORMS	  			
		
	 Section 2.01. Forms Generally
	  	 	22	 
	 Section 2.02. Form of Trustee’s Certificate of Authentication
	  	 	22	 
		
	ARTICLE 3	  			
	THE CONTINGENT CONVERTIBLE PREFERRED SECURITIES	  			
		
	 Section 3.01. Amount Unlimited; Issuable in Series
	  	 	23	 
	 Section 3.02. Denominations
	  	 	25	 
	 Section 3.03. Execution, Authentication, Delivery and Dating
	  	 	25	 
	 Section 3.04. Temporary Contingent Convertible Preferred Securities
	  	 	26	 
	 Section 3.05. Registration, Registration of Transfer and Exchange
	  	 	26	 
	 Section 3.06. Mutilated, Destroyed, Lost and Stolen Contingent Convertible Preferred
Securities
	  	 	29	 
	 Section 3.07. Distributions. Rights Preserved
	  	 	30	 
	 Section 3.08. Distributions Discretionary
	  	 	30	 
	 Section 3.09. Restrictions on Payments
	  	 	31	 
	 Section 3.10. Agreement to Distribution Cancellation
	  	 	31	 
	 Section 3.11. Notice of Distribution Cancellation
	  	 	32	 
	 Section 3.12. Persons Deemed Owners
	  	 	32	 
	 Section 3.13. Cancellation
	  	 	33	 
	 Section 3.14. Computation of Distributions
	  	 	33	 
	 Section 3.15. Cusip Numbers
	  	 	33	 
	 Section 3.16. Additional Parity Securities and Contingent Convertible Preferred
Securities
	  	 	34	 
	 Section 3.17. Correction of Minor Defects in or Amendment of Contingent Convertible
Preferred Securities
	  	 	34	 
	 Section 3.18. Payments Subject to Fiscal Laws
	  	 	34	 
	 Section 3.19. Undertakings
	  	 	35	 

  
 ii 

					
		
	ARTICLE 4	  			
	CONVERSION OF THE CONTINGENT CONVERTIBLE PREFERRED SECURITIES	  			
		
	 Section 4.01. Conversion upon Trigger Event
	  	 	35	 
	 Section 4.02. Conversion upon Capital Reduction
	  	 	36	 
	 Section 4.03. Upon conversion
	  	 	37	 
	 Section 4.04. Conversion Price
	  	 	38	 
	 Section 4.05. Anti-Dilution Adjustment of the Floor Price
	  	 	38	 
	 Section 4.06. Conversion Procedures. Common Shares
	  	 	47	 
	 Section 4.07. Agreement and Waiver with Respect to Conversion
	  	 	49	 
	 Section 4.08. Settlement Procedures
	  	 	50	 
	 Section 4.09. Failure to Deliver a Delivery Notice
	  	 	52	 
	 Section 4.10. Delivery of ADSs
	  	 	52	 
		
	ARTICLE 5	  			
	SATISFACTION AND DISCHARGE	  			
		
	 Section 5.01. Satisfaction and Discharge of Contingent Convertible Preferred Securities
Indenture
	  	 	53	 
		
	ARTICLE 6	  			
	REMEDIES	  			
		
	 Section 6.01. Enforcement Events
	  	 	53	 
	 Section 6.02. Liquidation Distribution
	  	 	54	 
	 Section 6.03. Limitation of Remedies Upon an Enforcement Event
	  	 	54	 
	 Section 6.04. No Other Remedies and Other Terms
	  	 	54	 
	 Section 6.05. Agreement with Respect to Limitation of Remedies for Breach of a Performance
Obligation
	  	 	55	 
	 Section 6.06. Trustee May File Proofs of Claim
	  	 	55	 
	 Section 6.07. Trustee May Enforce Claims Without Possession of Contingent Convertible
Preferred Securities
	  	 	56	 
	 Section 6.08. Application of Money Collected
	  	 	56	 
	 Section 6.09. Limitation on Suits
	  	 	56	 
	 Section 6.10. Unconditional Right of Holders to Receive Liquidation Preference (and
Premium, if any), Distributions and Additional Amounts
	  	 	57	 
	 Section 6.11. Restoration of Rights and Remedies
	  	 	57	 
	 Section 6.12. Rights and Remedies Cumulative
	  	 	57	 
	 Section 6.13. Delay or Omission Not Waiver
	  	 	57	 
	 Section 6.14. Control by Holders
	  	 	58	 
	 Section 6.15. Undertaking for Costs
	  	 	58	 
	 Section 6.16. Waiver of Past Enforcement Events
	  	 	58	 
		
	ARTICLE 7	  			
	THE TRUSTEE	  			
		
	 Section 7.01. Certain Duties and Responsibilities
	  	 	58	 
	 Section 7.02. Spanish Tax Procedures and Obligations of the Trustee
	  	 	59	 
	 Section 7.03. Notice of Enforcement Events
	  	 	60	 
	 Section 7.04. Certain Rights of Trustee
	  	 	60	 
	 Section 7.05. Not Responsible for Recitals or Issuance of Contingent Convertible Preferred
Securities
	  	 	61	 
	 Section 7.06. May Hold Contingent Convertible Preferred Securities
	  	 	62	 
	 Section 7.07. Money Held in Trust
	  	 	62	 
	 Section 7.08. Compensation and Reimbursement
	  	 	62	 
	 Section 7.09. Disqualification; Conflicting Interests
	  	 	63	 
	 Section 7.10. Corporate Trustee Required; Eligibility
	  	 	63	 

  
 iii 

					
	 Section 7.11. Resignation and Removal; Appointment of Successor
	  	 	63	 
	 Section 7.12. Acceptance of Appointment by Successor
	  	 	64	 
	 Section 7.13. Merger, Conversion, Consolidation or Succession to Business
	  	 	65	 
	 Section 7.14. Preferential Collection of Claims
	  	 	65	 
	 Section 7.15. Appointment of Authenticating Agent
	  	 	65	 
	 Section 7.16. Appointment of Additional Trustees
	  	 	66	 
	 Section 7.17. Tax Withholding
	  	 	67	 
		
	ARTICLE 8	  			
	HOLDERS LISTS AND REPORTS BY TRUSTEE AND COMPANY	  			
		
	 Section 8.01. Company to Furnish Trustee Names and Addresses of Holders
	  	 	67	 
	 Section 8.02. Preservation of Information; Communication to Holders
	  	 	67	 
	 Section 8.03. Reports by Trustee
	  	 	68	 
	 Section 8.04. Reports by Company
	  	 	68	 
		
	ARTICLE 9	  			
	CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER	  			
		
	 Section 9.01. Company May Consolidate, Etc., Only on Certain Terms
	  	 	69	 
	 Section 9.02. Successor Corporation Substituted
	  	 	69	 
	 Section 9.03. Assumption of Obligations
	  	 	70	 
		
	ARTICLE 10	  			
	SUPPLEMENTAL INDENTURES	  			
		
	 Section 10.01. Supplemental Indenture without Consent of Holders
	  	 	70	 
	 Section 10.02. Supplemental Indentures with Consent of Holders
	  	 	72	 
	 Section 10.03. Execution of Supplemental Indentures
	  	 	73	 
	 Section 10.04. Effect of Supplemental Indentures
	  	 	73	 
	 Section 10.05. Conformity with Trust Indenture Act
	  	 	73	 
	 Section 10.06. Reference in Contingent Convertible Preferred Securities to Supplemental
Indentures
	  	 	73	 
		
	ARTICLE 11	  			
	COVENANTS	  			
		
	 Section 11.01. Payment of Liquidation Preference and Distributions
	  	 	73	 
	 Section 11.02. Maintenance of Office or Agency
	  	 	73	 
	 Section 11.03. Money for Payments to be Held in Trust
	  	 	74	 
	 Section 11.04. Additional Amounts
	  	 	75	 
	 Section 11.05. Corporate Existence
	  	 	77	 
	 Section 11.06. Statement as to Compliance
	  	 	77	 
		
	ARTICLE 12	  			
	REDEMPTION AND PURCHASE OF CONTINGENT CONVERTIBLE PREFERRED SECURITIES	  			
		
	 Section 12.01. Applicability of Article
	  	 	77	 
	 Section 12.02. Election to Redeem; Notice to Trustee
	  	 	77	 
	 Section 12.03. [Reserved]
	  	 	77	 
	 Section 12.04. Redemption Procedures; Notice of Redemption
	  	 	77	 
	 Section 12.05. [Reserved.]
	  	 	79	 
	 Section 12.06. Contingent Convertible Preferred Securities Payable on Redemption
Date
	  	 	79	 
	 Section 12.07. [Reserved]
	  	 	79	 
	 Section 12.08. Optional Redemption
	  	 	79	 
	 Section 12.09. Optional Redemption Due To A Tax Event
	  	 	79	 

  
 iv 

					
	 Section 12.10. Optional Redemption Due To A Capital Event
	  	 	80	 
	 Section 12.11. Purchases of Contingent Convertible Preferred Securities
	  	 	80	 
	 Section 12.12. [Reserved]
	  	 	80	 
	 Section 12.13. Cancelled Distributions Not Payable Upon Redemption
	  	 	80	 
		
	ARTICLE 13	  			
	SUBORDINATION OF CONTINGENT CONVERTIBLE PREFERRED SECURITIES	  			
		
	 Section 13.01. Subordination
	  	 	80	 
	 Section 13.02. Waiver of Right of
Set-Off
	  	 	81	 
	 Section 13.03. [Reserved]
	  	 	82	 
	 Section 13.04. Trustee to Effectuate Subordination
	  	 	82	 
	 Section 13.05. Trustee Not Fiduciary for Senior Creditors
	  	 	82	 
	 Section 13.06. Rights of Trustee as Senior Creditor; Preservation of Trustee’s
Rights
	  	 	82	 
	 Section 13.07. Article Applicable to Paying Agents
	  	 	82	 
		
	ARTICLE 14	  			
	SPANISH BAIL-IN AND RESOLUTION ACTIONS	  			
		
	 Section 14.01. Agreement and Acknowledgment with Respect to the Exercise of the Spanish Bail-in Power
	  	 	82	 
	 Section 14.02. BRRD Liabilities
	  	 	84	 

  
 v 

 CONTINGENT CONVERTIBLE PREFERRED SECURITIES INDENTURE, dated as of September 25, 2017
between BANCO BILBAO VIZCAYA ARGENTARIA, S.A., a sociedad anónima organized under the laws of the Kingdom of Spain (the “Company”), having its principal executive office located at Calle Azul 4, Madrid, Spain, and The
Bank of New York Mellon, a New York banking corporation duly organized and existing under the laws of the State of New York, having its principal corporate trust office located at 101 Barclay Street, New York, New York 10286, United States, and
acting (except with respect to its role as Contingent Convertible Preferred Security Registrar) through its London Branch through its Corporate Trust Office located at One Canada Square, London E14 5AL, United Kingdom (in its capacity as trustee,
the “Trustee”, which term includes any successor Trustee). 
 RECITALS 

The Company has duly authorized the execution and delivery of this Contingent Convertible Preferred Securities Indenture to provide for the
issuance from time to time of its non-step-up non-cumulative contingent convertible preferred securities (the “Contingent
Convertible Preferred Securities”), to be issued in one or more series, represented by one or more Global Securities in registered form, or represented by definitive Contingent Convertible Preferred Securities in registered form, the amount
and terms of each such series to be determined as hereinafter provided. 
 All things necessary to make this Contingent Convertible
Preferred Securities Indenture a valid and binding agreement of the Company, in accordance with its terms, have been done. 
 This
Contingent Convertible Preferred Securities Indenture is subject to the provisions of the Trust Indenture Act of 1939, as amended, and the rules and regulations of the U.S. Securities and Exchange Commission promulgated thereunder that are required
to be part of this Contingent Convertible Preferred Securities Indenture and, to the extent applicable, shall be governed by such provisions. 

NOW, THEREFORE, THIS CONTINGENT CONVERTIBLE PREFERRED SECURITIES INDENTURE WITNESSETH: 

For and in consideration of the premises and the purchase of the Contingent Convertible Preferred Securities by the Holders (as defined herein)
thereof, it is mutually covenanted and agreed, for the equal and proportionate benefit of all Holders of Contingent Convertible Preferred Securities of any series, as follows: 

ARTICLE 1 

DEFINITIONS AND OTHER PROVISIONS OF GENERAL
APPLICATION 
 Section 1.01. Definitions. For all purposes of this Contingent Convertible Preferred Securities
Indenture, except as otherwise expressly provided or unless the context otherwise requires: 
 (a) the terms defined in this Article have the
meanings assigned to them in this Article and include the plural as well as the singular; 
 (b) all other terms used herein which are
defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein; 
 (c) all
accounting terms not otherwise defined herein have the meanings assigned to them in accordance with International Financial Reporting Standards as issued by the European Union; 

(d) the words “herein,” “hereof,” “hereto” and “hereunder” and other words
of similar import refer to this Contingent Convertible Preferred Securities Indenture as a whole and not to any particular Article, Section or other subdivision; 

(e) the term “including” means “including without limitation;” 

 (f) unless the context otherwise requires, any reference to an “Article” or a
“Section” refers to an Article or Section of this Contingent Convertible Preferred Securities Indenture; and 
 (g) the word
“or” is always used inclusively (for example, the phrase “A or B” means “A or B or both”, not “either A or B but not both”). 

Certain terms, used principally in certain Articles hereof, are defined in those Articles. 

References to any act or statute or any provision of any act or statute shall be deemed also to refer to any statutory modification or re-enactment thereof or any statutory instrument, order or regulation made in accordance therewith or under such modification or re-enactment. 

“Accounting Currency” means euro or such other primary currency used in the presentation of the Group’s accounts from
time to time. 
 “Act”, when used with respect to any Holder, has the meaning specified in Section 1.04. 

“Additional Amounts” has the meaning specified in Section 11.04. 

“Additional Common Shares” has the meaning specified in Section 4.05(d). 

“Additional Contingent Convertible Preferred Securities” has the meaning specified in Section 3.16. 

“Additional Tier 1 Capital” means Additional Tier 1 capital (capital de nivel 1 adicional) as provided under
Applicable Banking Regulations. 
 “Additional Tier 1 Instrument” means any contractually subordinated obligation of the
Company constituting an Additional Tier 1 instrument (instrumento de capital de nivel 1 adicional) in accordance with Applicable Banking Regulations. 

“ADR Deposit Agreement” means the Amended and Restated Deposit Agreement dated as of June 29, 2007, as may be further
amended from time to time, between the Company, The Bank of New York Mellon and the holders from time to time of American Depositary Receipts issued thereunder. 

“ADS” means an American Depository Share which is the subject of the ADR Deposit Agreement. 

“ADS Depositary” means The Bank of New York Mellon, as the depositary under the ADR Deposit Agreement or any successor ADS
depositary. 
 “Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled
by or under direct or indirect common control with such specified Person. For the purposes of this definition, “control” when used with respect to any specified Person means the power to direct the management and policies of such Person,
directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing. 

“Agents” means the agents appointed in accordance with this Contingent Convertible Preferred Securities Indenture or any
applicable supplemental indenture and shall include any Paying Agent, Contingent Convertible Preferred Security Registrar, Paying and Conversion Agent, Calculation Agent and Authenticating Agent. 

“Agent Member” means a member of, or participant in, any Depositary. 

“Amounts Due” with respect to the Contingent Convertible Preferred Securities of a series means the Liquidation Preference
(and premium, if any), together with any accrued but unpaid Distributions, and Additional Amounts, if any, due on the Contingent Convertible Preferred Securities of such series. References to such amounts will include amounts that have become due
and payable, but which have not been paid, prior to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority. 

  
 2 

 “Applicable Banking Regulations” means at any time the laws, regulations,
requirements, guidelines and policies relating to capital adequacy, resolution and/or solvency then applicable to the Company and/or the Group including, without limitation to the generality of the foregoing, CRD IV, the BRRD and those laws,
regulations, requirements, guidelines and policies relating to capital adequacy, resolution and/or solvency then in effect in Spain (whether or not such regulations, requirements, guidelines or policies have the force of law and whether or not they
are applied generally or specifically to the Company and/or the Group). 
 “Authenticating Agent” means, when used with
respect to the Contingent Convertible Preferred Securities of any series, any Person authorized by the Trustee pursuant to this Contingent Convertible Preferred Securities Indenture to act on behalf of the Trustee to authenticate Contingent
Convertible Preferred Securities of such series. Initially, and unless otherwise specified, The Bank of New York Mellon, acting through its principal corporate trust office in New York shall act as Authenticating Agent. 

“Authorized Newspaper” means a newspaper, in an official language of the place of publication or in the English language,
customarily published on each day that is a Business Day in the place of publication, whether or not published on days that are Legal Holidays in the place of publication, and of general circulation in each place in connection with which the term is
used or in the financial community of each such place. Where successive publications are required to be made in Authorized Newspapers, the successive publications may be made in the same or in different newspapers in the same city meeting the
foregoing requirements and in each case on any day that is a Business Day in the place of publication. 
 “Board of
Directors” means either the board of directors of the Company or any committee or Person duly authorized to act generally or in any particular respect for the Company hereunder. 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary or any Person duly
authorized by the Company to have been duly adopted by the relevant Board of Directors or an authorized committee thereof and to be in full force and effect on the date of such certification and delivered to the Trustee. 

“BRRD” means Directive 2014/59/EU of the European Parliament and the Council of the European Union of May 15, 2014
establishing a framework for the recovery and resolution of credit institutions and investment firms, as implemented into Spanish law, as amended or supplemented from time to time, or any such other directive as may come into effect in place
thereof, and including any other relevant implementing regulatory provisions. 
 “BRRD Liability” means any liability,
commitment, duty, responsibility, amount payable or contingency or other obligation arising from, or related to, this Contingent Convertible Preferred Securities Indenture which may be subject to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority. 
 “Business Day” means,
unless otherwise provided in the form of Contingent Convertible Preferred Securities for any particular series pursuant to the provisions of this Contingent Convertible Preferred Securities Indenture, any day, other than Saturday or Sunday, that is
neither a Legal Holiday nor a day on which banking institutions are authorized or required by law, regulation or executive order to close in the City of New York, London, Madrid or any other place or places where the Liquidation Preference (and
premium, if any) of, or any Distributions on, or any Additional Amounts with respect to the Contingent Convertible Preferred Securities of that series are payable. 

“Calculation Agent” means, when used with respect to the Contingent Convertible Preferred Securities of any series, any
Person authorized by the Company as the party responsible for making the calculations referred to in Section 1.16 herein. 

  
 3 

 “Capital Event” means, when used with respect to the Contingent Convertible
Preferred Securities of any series, a change (or any pending change which the Regulator considers to be sufficiently certain) in Spanish law or Applicable Banking Regulations that results (or would result) in any of the outstanding aggregate
Liquidation Preference of the Contingent Convertible Preferred Securities of such series ceasing to be included in, or counting towards, the Group’s or the Company’s Tier 1 Capital. 

“Capital Reduction” means the adoption, in accordance with Article 418.3 of the Spanish Companies Act, by a general
shareholders’ meeting of the Company of a resolution of capital reduction by reimbursement of cash contributions (restitución de aportaciones) to Shareholders by way of a reduction in the nominal value of the shares
of such Shareholders in the capital of the Company. A resolution of capital reduction for the redemption of any Common Shares previously repurchased by the Company will not be considered a Capital Reduction for the purposes of this Contingent
Convertible Preferred Securities Indenture. 
 “Capital Reduction Conversion” has the meaning specified in
Section 4.02(a). 
 “Capital Reduction Notice” has the meaning specified in Section 4.06(b), which notice shall
specify the Election Period and the procedures for Holders to deliver an Election Notice. 
 “Capital Reduction Notice
Date” means the date on which a Capital Reduction Notice is deemed to be given in accordance with Section 4.06(d). 

“Cash Dividend” means (i) any Dividend which is to be paid or made in cash (in whatever currency), but other than
falling within paragraph (b) of the definition of “Spin-Off” and (ii) any Dividend determined to be a Cash Dividend pursuant to paragraph (a) of the definition of “Dividend”,
but a Dividend falling within paragraph (c) or (d) of the definition of “Dividend” shall be treated as being a Non-Cash Dividend. 

“CET1 Capital” means, at any time, the common equity tier 1 capital of the Company or the Group, respectively, as calculated
by the Company in accordance with Chapter 2 (Common Equity Tier 1Capital) of Title I (Elements of Own Funds) of Part Two (Own Funds) of the CRR and/or Applicable Banking Regulations at such time, including any applicable transitional, phasing in or
similar provisions. 
 “CET1 ratio” means, at any time, with respect to the Company or the Group, as the case may be, the
reported ratio (expressed as a percentage) of the aggregate amount (in the Accounting Currency) of the CET1 Capital of the Company or the Group, respectively, at such time divided by the Risk Weighted Assets Amount of the Company or the Group,
respectively, at such time, all as calculated by the Company. 
 “Clearing System” means DTC or any of the European
Clearing Systems, as applicable. 
 “Closing Price” means, in respect of a Common Share and in relation to any dealing day,
the price per Common Share quoted by the Relevant Stock Exchange as the closing price or closing auction price of a Common Share on such dealing day. 

“CNMV” means the Spanish Securities Market Commission (Comisión Nacional del Mercado de Valores). 

“Commission” means the United States Securities and Exchange Commission, as from time to time constituted, created under the
Exchange Act, or, if at any time after the execution of this Contingent Convertible Preferred Securities Indenture such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing
such duties at such time. 
 “Common Shares” means ordinary shares in the capital of the Company, each of which confers on
the holder one vote at general meetings of the Company and is credited as fully paid up. 
 “Company” means the Person
named as the “Company” in the first paragraph of this Contingent Convertible Preferred Securities Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Contingent Convertible
Preferred Securities Indenture, and thereafter “Company” shall mean such successor Person, and any other obligor upon the Contingent Convertible Preferred Securities. 

  
 4 

 “Company Request” and “Company Order” mean, respectively, a
written request or order, as the case may be, signed in the name of the Company by any member of the Board of Directors, the Secretary or an Assistant Secretary of the Board of Directors, the President, a Vice President, the Treasurer, an Assistant
Treasurer or other representative of the Company empowered to do so by Board Resolution, and delivered to the Trustee, the Paying Agent or the Calculation Agent, as the case may be. 

“Contingent Convertible Preferred Securities” has the meaning specified in the recitals contained herein and more
particularly means any series of Contingent Convertible Preferred Securities issued, authenticated and delivered under this Contingent Convertible Preferred Securities Indenture; provided, however, that, if at any time there is more than one
Person acting as Trustee under this Contingent Convertible Preferred Securities Indenture, “Contingent Convertible Preferred Securities”, with respect to any such Person, shall mean Contingent Convertible Preferred Securities authenticated
and delivered under this Contingent Convertible Preferred Securities Indenture, exclusive, however, of Contingent Convertible Preferred Securities of any series as to which such Person is not acting as Trustee. 

“Contingent Convertible Preferred Securities Indenture” means this instrument as originally executed or as it may from time
to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof and, with respect to any Contingent Convertible Preferred Security, by the terms and provisions thereof
established pursuant to Section 3.01. 
 “Contingent Convertible Preferred Security” means one of the Contingent
Convertible Preferred Securities. 
 “Contingent Convertible Preferred Security Register” and “Contingent
Convertible Preferred Security Registrar” have the respective meanings specified in Section 3.05. 

“Conversion” means a Trigger Conversion or a Capital Reduction Conversion, as the case may be. 

“Conversion Event” means a Trigger Event or a Capital Reduction, as the case may be. 

“Conversion Notice” means a Trigger Event Notice or a Capital Reduction Notice, as the case may be. 

“Conversion Notice Date” means the Trigger Event Notice Date or the Capital Reduction Notice Date, as the case may be. 

“Conversion Price” has the meaning specified in Section 4.04. 

“Conversion Settlement Date” means the date on which the relevant Common Shares are to be delivered following Conversion,
which shall be as soon as practicable and in any event not later than one month following (or such other period as Applicable Banking Regulations may require) the relevant Conversion Notice Date. 

“Conversion Shares Depository” means, when used with respect to the Contingent Convertible Preferred Securities of any
series, a reputable independent financial institution, trust company or similar entity to be appointed by the Company on or prior to any date when a function ascribed to the Conversion Shares Depository is required to be performed to perform such
functions and who will hold Common Shares in Iberclear or any of its participating entities in a designated trust or custody account for the benefit of the Holders of the Contingent Convertible Preferred Securities of such series and otherwise on
terms consistent with the terms of the Contingent Convertible Preferred Securities of such series and the Contingent Convertible Preferred Securities Indenture. 

“Corporate Trust Office” means the corporate trust office of the Trustee at which, at any particular time, its corporate
trust business is principally administered, which, with respect to The Bank of New York Mellon, acting through its London Branch, is currently located at One Canada Square, London E14 5AL United Kingdom, and the Contingent Convertible Preferred
Securities Indenture shall be administered (except with respect to the role of Contingent Convertible Preferred Security Registrar) at such corporate trust office, or such other location as notified by the Trustee to the Company from time to time,
or, if a different Trustee is appointed for a particular series of Contingent Convertible Preferred Securities, the address set forth in the supplemental indenture naming the Trustee for that particular series of Contingent Convertible Preferred
Securities. 

  
 5 

 The term “corporation” includes corporations, associations, companies,
partnerships and business trusts. 
 “CRD IV” means any or any combination of the CRD IV Directive, the CRR, and any CRD IV
Implementing Measures. 
 “CRD IV Directive” means Directive 2013/36/EU of the European Parliament and of the Council of
June 26, on access to the activity of credit institutions and the prudential supervision of credit institutions and investment firms, amending Directive 2002/87/EC and repealing Directives 2006/48/EC and 2006/49/EC, as amended or supplemented
from time to time, or such other directive as may come into effect in place thereof. 
 “CRD IV Implementing Measures”
means any regulatory capital rules implementing the CRD IV Directive or the CRR which may from time to time be introduced, including, but not limited to, delegated or implementing acts (regulatory technical standards) adopted by the European
Commission, national laws and regulations, and regulations and guidelines issued by the Regulator, the European Banking Authority or any other relevant authority, which are applicable to the Company (on a standalone basis) or the Group (on a
consolidated basis), including, without limitation, Law 10/2014 and any other regulation, circular or guidelines implementing or developing Law 10/2014. 

“CRR” means Regulation (EU) No. 575/2013 of the European Parliament and of the Council of June 26, on the
prudential requirements for credit institutions and investment firms and amending Regulation (EU) No. 648/2012, as amended or supplemented from time to time, or such other regulation as may come into effect in place thereof. 

“Current Market Price” means, in respect of a Common Share at a particular date, the average of the daily Volume Weighted
Average Price of a Common Share on each of the five consecutive dealing days ending on the dealing day immediately preceding such date (the “Relevant Period”) (rounded if necessary to the nearest cent with 0.5 cents being rounded
upwards); provided that if at any time during the Relevant Period the Volume Weighted Average Price shall have been based on a price ex-Dividend (or ex-any other
entitlement) and during some other part of that period the Volume Weighted Average Price shall have been based on a price cum-Dividend (or cum-any other entitlement),
then: 
  

	 	(a)	if the Common Shares to be issued and delivered are not entitled to receive the Dividend (or entitlement) in question, the Volume Weighted Average Price on the dates on which the Common Shares shall have been based on a
price cum-Dividend (or cum-any other entitlement) shall for the purposes of this definition be deemed to be the amount thereof reduced by an amount equal to the Fair
Market Value of any such Dividend or entitlement per Common Share as at the date of the first public announcement relating to such Dividend or entitlement, in any such case, determined on a gross basis and disregarding any withholding or deduction
required to be made for or on account of tax, and disregarding any associated tax credit; or 

  

	 	(b)	if the Common Shares to be issued and delivered are entitled to receive the Dividend (or entitlement) in question, the Volume Weighted Average Price on the dates on which the Common Shares shall have been based on a
price ex-Dividend (or ex-any other entitlement) shall for the purposes of this definition be deemed to be the amount thereof increased by an amount equal to the Fair
Market Value of any such Dividend or entitlement per Common Share as at the date of the first public announcement relating to such Dividend or entitlement, in any such case, determined on a gross basis and disregarding any withholding or deduction
required to be made for or on account of tax, and disregarding any associated tax credit, 

 and provided further that: 

  
 6 

	 	(i)	if on each of the dealing days in the Relevant Period the Volume Weighted Average Price shall have been based on a price cum-Dividend (or
cum-any other entitlement) in respect of a Dividend (or other entitlement) which has been declared or announced but the Common Shares to be issued and delivered are not entitled to receive that Dividend (or
other entitlement) the Volume Weighted Average Price on each of such dates shall for the purposes of this definition be deemed to be the amount thereof reduced by an amount equal to the Fair Market Value of any such Dividend or entitlement per
Common Share as at the date of first public announcement relating to such Dividend or entitlement; and 

  

	 	(ii)	if the Volume Weighted Average Price of a Common Share is not available on one or more of the dealing days in the Relevant Period (disregarding for this purpose the proviso to the definition of Volume Weighted Average
Price), then the average of such Volume Weighted Average Prices which are available in the Relevant Period shall be used (subject to a minimum of two such prices) and if only one, or no, such Volume Weighted Average Price is available in the
Relevant Period the Current Market Price shall be determined in good faith by an Independent Financial Adviser. 

 In making
any calculation or determination of Current Market Price or Volume Weighted Average Price, such adjustments (if any) shall be made as an Independent Financial Adviser determines in good faith appropriate to reflect any consolidation or sub-division of the Common Shares or any issue of Common Shares by way of capitalization of profits or reserves, or any like or similar event. 

“dealing day” means a day on which the Relevant Stock Exchange or relevant stock exchange or securities market is open for
business and on which Common Shares, Securities, Spin-Off Securities, options, warrants or other rights (as the case may be) may be dealt in (other than a day on which the Relevant Stock Exchange or relevant
stock exchange or securities market is scheduled to or does close prior to its regular weekday closing time). 
 “Delivery
Notice” means a notice in the form for the time being currently available from the specified office of any Paying and Conversion Agent which contains the relevant account and related details for the delivery of any Common Shares (or ADSs)
and such other information as is set forth in Section 4.08(c), and which is required to be delivered in connection with a Conversion of the Contingent Convertible Preferred Securities and the delivery of the Common Shares (or ADSs). 

“Depositary” means, with respect to any series of Contingent Convertible Preferred Securities, a clearing agency that is
designated to act as Depositary for the Global Securities evidencing all or part of such Contingent Convertible Preferred Securities as contemplated by Section 3.01. 

“Distributable Items” shall have the meaning given to such term in CRD IV, as interpreted and applied in accordance with
Applicable Banking Regulations. 
 “Distribution” means the non-cumulative cash
distribution, if any, in respect of the Contingent Convertible Preferred Securities in a Distribution Period, determined in accordance with Section 3.07. 

“Distribution Payment Date” shall have the meaning as determined pursuant to Section 3.01. 

“Distribution Period” means the period from and including one Distribution Payment Date (or, in the case of the first
Distribution Period, the date of issuance) to but excluding the next Distribution Payment Date. 
 “Distribution Rate”
means the rate at which the Contingent Convertible Preferred Securities accrue Distributions in accordance with Section 3.07. 

“Dividend” means any dividend or distribution to Shareholders in respect of the Common Shares (including a Spin-Off) whether of cash, assets or other property (and for these purposes a distribution of assets includes without limitation an issue of Common Shares or other Securities credited as fully or partly paid up by
way of capitalization of profits or reserves), and however described and whether payable out of share premium account, profits, retained earnings or any other capital or revenue reserve or account, and including a distribution or payment to
Shareholders upon or in connection with a reduction of capital, provided that: 

  
 7 

	 	(a)	where: 

  

	 	(i)	a Dividend in cash is announced which is to be, or may at the election of a Shareholder or Shareholders be, satisfied by the issue or delivery of Common Shares or other property or assets, or where a capitalization of
profits or reserves is announced which is to be, or may at the election of a Shareholder or Shareholders be, satisfied by the payment of cash, then the Dividend in question shall be treated as a Cash Dividend of an amount equal to the greater of
(A) the Fair Market Value of such cash amount and (B) the Current Market Price of such Common Shares as at the first date on which the Common Shares are traded ex-the relevant Dividend on the
Relevant Stock Exchange or, as the case may be, the record date or other due date for establishment of entitlement in respect of the relevant capitalization or, as the case may be, the Fair Market Value of such other property or assets as at the
date of the first public announcement of such Dividend or capitalization or, in any such case, if later, the date on which the number of Common Shares (or amount of such other property or assets, as the case may be) which may be issued and delivered
is determined; or 

  

	 	(ii)	there shall be any issue of Common Shares by way of capitalization of profits or reserves (including any share premium account or capital redemption reserve) where such issue is, or is expressed to be, in lieu of a
Dividend (whether or not a Cash Dividend equivalent or amount is announced or would otherwise be payable to Shareholders, whether at their election or otherwise), the Dividend in question shall be treated as a Cash Dividend of an amount equal to the
Current Market Price of such Common Shares as at the first date on which the Common Shares are traded ex-the relevant Dividend on the Relevant Stock Exchange or, as the case may be, the record date or other
due date for establishment of entitlement in respect of the relevant capitalization or, in any such case, if later, the date on which the number of Common Shares to be issued and delivered is determined; 

 

	 	(b)	any issue of Common Shares falling within Section 4.05(a)(i) and Section 4.05(a)(ii) shall be disregarded; 

  

	 	(c)	 a purchase or redemption or buy back of share capital of the Company by or on behalf of the Company in accordance
with any general authority for such purchases or buy backs approved by a general meeting of Shareholders and otherwise in accordance with the limitations prescribed under the Spanish Companies Act for dealings generally by a company in its own
shares shall not constitute a Dividend and any other purchase or redemption or buy back of share capital of the Company by or on behalf of the Company or any member of the Group shall not constitute a Dividend unless, in the case of a purchase or
redemption or buy back of Common Shares by or on behalf of the Company or any member of the Group, the weighted average price per Common Share (before expenses) on any one day (a “Specified Share Day”) in respect of such purchases
or redemptions or buy backs (translated, if not in the Share Currency, into the Share Currency at the Prevailing Rate on such day) exceeds by more than 5% the average of the daily Volume Weighted Average Price of a Common Share on the five dealing
days immediately preceding the Specified Share Day or, where an announcement (excluding, for the avoidance of doubt for these purposes, any general authority for such purchases, redemptions or buy backs approved by a general meeting of Shareholders
or any notice convening such a meeting of Shareholders) has been made of the intention to purchase, redeem or buy back Common Shares at some future date at a specified price or where a tender offer is made, on the five dealing days immediately
preceding the date of such announcement or the date of first public announcement of such tender offer (and regardless of whether or not a price per Common Share, a minimum price per Common Share or a price range or a formula for the determination
thereof is or is not announced at such time), as the case may be, in which case such purchase, redemption or buy back shall be deemed to constitute a Dividend in the Share Currency in an amount equal to the amount by which the aggregate price paid
(before 

  
 8 

	 	
expenses) in respect of such Common Shares purchased, redeemed or bought back by the Company or, as the case may be, any member of the Group (translated where appropriate into the Share Currency
as provided above) exceeds the product of (i) 105% of the daily Volume Weighted Average Price of a Common Share determined as aforesaid and (ii) the number of Common Shares so purchased, redeemed or bought back; 

 

	 	(d)	if the Company or any member of the Group shall purchase, redeem or buy back any depositary or other receipts or certificates representing Common Shares, the provisions of paragraph (c) above shall be applied in
respect thereof in such manner and with such modifications (if any) as shall be determined in good faith by an Independent Financial Adviser; and 

  

	 	(e)	where a dividend or distribution is paid or made to Shareholders pursuant to any plan implemented by the Company for the purpose of enabling Shareholders to elect, or which may require Shareholders, to receive dividends
or distributions in respect of the Common Shares held by them from a person other than (or in addition to) the Company, such dividend or distribution shall for the purposes of these Contingent Convertible Preferred Securities of any series be
treated as a dividend or distribution made or paid to Shareholders by the Company, and the provisions of the Contingent Convertible Preferred Securities and the Contingent Convertible Preferred Securities Indenture, including references to the
Company paying or making a dividend, shall be construed accordingly. 

 “DTC” means The Depository Trust
Company or its nominee or its or their respective successor. 
 “Election Notice” has the meaning specified in
Section 4.02(b). 
 “Election Period” has the meaning specified in Section 4.02(b). 

“equity share capital” means, in relation to any entity, its issued share capital excluding any part of that capital which,
in respect of dividends and capital, does not carry any right to participate beyond a specific amount in a distribution. 

“Enforcement Event” has the meaning specified in Section 6.01. 

“EUR”, “€” and “euro” means currency of the member states of the European Union
(“EU”) that, from time to time, have adopted the single currency in accordance with the treaty establishing the European Community, as amended from time to time. 

“European Clearing System” means Euroclear Bank S.A./N.V. (“Euroclear Bank”), as operator of the Euroclear
System (“Euroclear”), and/or Clearstream Banking, société anonyme (“Clearstream Luxembourg”). 

“Exchange Act” means the United States Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated
by the Commission thereunder. 
 “Existing Shareholders” has the meaning specified in the definition of “Newco
Scheme”. 
 “Fair Market Value” means, with respect to any property on any date, the fair market value of that
property as determined by an Independent Financial Adviser in good faith provided that (a) the Fair Market Value of a Cash Dividend shall be the amount of such Cash Dividend; (b) the Fair Market Value of any other cash amount shall
be the amount of such cash; (c) where Securities, Spin-Off Securities, options, warrants or other rights are publicly traded on a stock exchange or securities market of adequate liquidity (as determined
by an Independent Financial Adviser in good faith), the Fair Market Value (i) of such Securities or Spin-Off Securities shall equal the arithmetic mean of the daily Volume Weighted Average Prices of such
Securities or Spin-Off Securities and (ii) of such options, warrants or other rights shall equal the arithmetic mean of the daily closing prices of such options, warrants or other rights, in the case of
both (i) and (ii) above during the period of five dealing days on the relevant stock exchange or securities market commencing on such date (or, if later, the first such dealing day such Securities,

  
 9 

 
Spin-Off Securities, options, warrants or other rights are publicly traded) or such shorter period as such Securities,
Spin-Off Securities, options, warrants or other rights are publicly traded; and (d) where Securities, Spin-Off Securities, options, warrants or other rights are not
publicly traded on a stock exchange or securities market of adequate liquidity (as aforesaid), the Fair Market Value of such Securities, Spin-Off Securities, options, warrants or other rights shall be
determined by an Independent Financial Adviser in good faith, on the basis of a commonly accepted market valuation method and taking account of such factors as it considers appropriate, including the market price per Common Share, the dividend yield
of a Common Share, the volatility of such market price, prevailing interest rates and the terms of such Securities, Spin-Off Securities, options, warrants or other rights, including as to the expiry date and
exercise price (if any) thereof. Such amounts shall, in the case of (a) above, be translated into the Share Currency (if such Cash Dividend is declared or paid or payable in a currency other than the Share Currency) at the rate of exchange used
to determine the amount payable to Shareholders who were paid or are to be paid or are entitled to be paid the Cash Dividend in the Share Currency; and in any other case, shall be translated into the Share Currency (if expressed in a currency other
than the Share Currency) at the Prevailing Rate on that date. In addition, in the case of (a) and (b) above, the Fair Market Value shall be determined on a gross basis and disregarding any withholding or deduction required to be made for or on
account of tax, and disregarding any associated tax credit. 
 “Floor Price” means the price determined pursuant to
Section 3.01, subject to adjustment in accordance with Section 4.04. 
 “Foreign Currency” means the euro or any
currency issued by the government of any country (or a group of countries or participating member states) other than the United States of America which as at the time of payment is legal tender for the payment of public and private debts. 

“Further Contingent Convertible Preferred Securities” means any instruments or securities which are similar to the Contingent
Convertible Preferred Securities and are contingently convertible into Common Shares other than at the option of the holders thereof. 

“Global Security” means one or more global certificates evidencing all or part of a series of Contingent Convertible
Preferred Securities, authenticated and delivered to or on behalf of the Holder and registered in the name of the Holder or its nominee. 

“Group” means the Company and its consolidated subsidiaries. 

“Holder” means a Person in whose name a Contingent Convertible Preferred Security is registered in the Contingent Convertible
Preferred Security Register. 
 “Iberclear” means the Spanish clearing and settlement system (Sociedad de Gestión
de los Sistemas de Registro, Compensación y Liquidación de Valores, S.A.U.). 
 “Independent Financial
Adviser” means an independent financial institution or financial adviser of international repute appointed by the Company at its own expense. 

“Law 10/2014” means Law 10/2014 of June 26, on the organization, supervision and solvency of credit institutions (Ley
10/2014, de 26 de junio, de ordenación, supervisión y solvencia de entidades de crédito), as amended, replaced or supplemented from time to time. 

“Law 11/2015” means Law 11/2015, of June 18, on the recovery and resolution of credit institutions and investment firms
(Ley 11/2015, de 18 de junio, de recuperación y resolución de entidades de crédito y empresas de servicios de inversión), as amended, replaced or supplemented from time to time. 

“Legal Holiday”, with respect to any Place of Payment or other location, means a Saturday, a Sunday or a day on which banking
institutions in such Place of Payment or other location are not authorized or obligated to be open. 

  
 10 

 “Liquidation Distribution” means the Liquidation Preference per Contingent
Convertible Preferred Security plus, if applicable, where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09, an amount equal to accrued and unpaid
Distributions for the then current Distribution Period to (but excluding) the date of payment of the Liquidation Distribution. 

“Liquidation Event” has the meaning specified in Section 6.01. 

“Liquidation Preference” has the meaning specified in Section 3.01. 

“Maximum Distributable Amount” means, at any time, any maximum distributable amount required to be calculated at such time in
accordance with (a) Article 48 of Law 10/2014 and any provision developing Article 48 of Law 10/2014, and any other provision of Spanish law transposing or implementing Article 141 of the CRD IV Directive and/or (b) Applicable Banking
Regulations. 
 “Newco Scheme” means a scheme of arrangement or analogous proceeding (“Scheme of
Arrangement”) which effects the interposition of a limited liability company (“Newco”) between the Shareholders of the Company immediately prior to the Scheme of Arrangement (the “Existing Shareholders”)
and the Company, provided that: 
  

	 	(a)	only ordinary shares of Newco or depositary or other receipts or certificates representing ordinary shares of Newco are issued to Existing Shareholders; 

 

	 	(b)	immediately after completion of the Scheme of Arrangement the only shareholders of Newco or, as the case may be, the only holders of depositary or other receipts or certificates representing ordinary shares of Newco,
are Existing Shareholders and the Voting Rights in respect of Newco are held by Existing Shareholders in the same proportions as their respective holdings of such Voting Rights immediately prior to the Scheme of Arrangement; 

 

	 	(c)	immediately after completion of the Scheme of Arrangement, Newco is (or one or more wholly-owned Subsidiaries of Newco are) the only ordinary shareholder (or shareholders) of the Company; 

 

	 	(d)	all Subsidiaries of the Company immediately prior to the Scheme of Arrangement (other than Newco, if Newco is then a Subsidiary) are Subsidiaries of the Company (or of Newco) immediately after completion of the Scheme
of Arrangement; and 

  

	 	(e)	immediately after completion of the Scheme of Arrangement, the Company (or Newco) holds, directly or indirectly, the same percentage of the ordinary share capital and equity share capital of those Subsidiaries as was
held by the Company immediately prior to the Scheme of Arrangement. 

“Non-Cash Dividend” means any Dividend which is not a Cash Dividend, and shall
include a Spin-Off. 
 “Notice Cut-off
Date” has the meaning specified in Section 4.06(c). 
 “Officer’s Certificate” means a
certificate signed by the Chairman or the Vice Chairman of the Board of Directors, the Secretary or an Assistant Secretary of the Board of Directors, the President, a Vice President, the Treasurer, an Assistant Treasurer or any other Person duly
authorized by the Company and that, if required by the Trust Indenture Act, complies with the requirements of Section 314(e) of the Trust Indenture Act. 

“Opinion of Counsel” means a written opinion of legal advisors, who may be an employee of or legal advisors for the Company,
or other legal advisors who shall be reasonably acceptable to the Trustee and that, if required by the Trust Indenture Act, complies with the requirements of Section 314(e) of the Trust Indenture Act. 

  
 11 

 “Outstanding”, when used with respect to Contingent Convertible Preferred
Securities or any series of Contingent Convertible Preferred Securities means (except as otherwise specified pursuant to Section 3.01), as of the date of determination, all Contingent Convertible Preferred Securities or all Contingent
Convertible Preferred Securities of such series, as the case may be, theretofore authenticated and delivered under this Contingent Convertible Preferred Securities Indenture, except: 

 

	 	(i)	Contingent Convertible Preferred Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation; 

  

	 	(ii)	Contingent Convertible Preferred Securities in respect of which the Trustee acknowledges satisfaction and discharge of this Contingent Convertible Preferred Securities Indenture pursuant to Article 5; and

  

	 	(iii)	Contingent Convertible Preferred Securities for which the Redemption Price has been deposited pursuant to Section 12.04 (except as set forth in Section 12.04(d)(ii)) or in exchange for or in lieu of which
other Contingent Convertible Preferred Securities have been authenticated and delivered pursuant to this Contingent Convertible Preferred Securities Indenture, other than any such Contingent Convertible Preferred Securities in respect of which there
shall have been presented to the Trustee proof satisfactory to it that such Contingent Convertible Preferred Securities are held by a protected purchaser in whose hands such Contingent Convertible Preferred Securities are valid obligations of the
Company; 

 provided, however, that in determining whether the Holders of the requisite Liquidation Preference of the Outstanding
Contingent Convertible Preferred Securities of any series have given any request, demand, authorization, direction, notice, consent or waiver hereunder, (i) the Liquidation Preference of a Contingent Convertible Preferred Security denominated
in a Foreign Currency shall be the U.S. dollar equivalent, determined based on the Prevailing Rate on the date of original issuance of such Contingent Convertible Preferred Security, of the Liquidation Preference of such Contingent Convertible
Preferred Security; and (ii) Contingent Convertible Preferred Securities beneficially owned by the Company or any other obligor upon the Contingent Convertible Preferred Securities or any Affiliate of the Company or of such other obligor, shall
be disregarded and deemed not to be Outstanding except that, in determining whether the Trustee shall be protected in making any such determination or relying upon any such request, demand, authorization, direction, notice, consent or waiver, only
Contingent Convertible Preferred Securities which a Responsible Officer of the Trustee actually knows to be so beneficially owned shall be so disregarded; provided, further, however, that Contingent Convertible Preferred Securities so beneficially
owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Contingent Convertible Preferred Securities and that the
pledgee is not the Company or any other obligor upon the Contingent Convertible Preferred Securities or any Affiliate of the Company or of such other obligor. 

“Parity Securities” means any instrument issued or guaranteed by the Company (including the guarantee thereof), which
instrument or guarantee ranks pari passu with the Contingent Convertible Preferred Securities. 
 “Paying Agent”,
when used with respect to the Contingent Convertible Preferred Securities of any series, means any Person (which may include the Company) authorized by the Company to pay the Liquidation Preference (and premium, if any) of, or Distributions on, or
any Additional Amounts with respect to, the Contingent Convertible Preferred Securities of such series on behalf of the Company, which expression shall include the Principal Paying Agent. Except as otherwise specified as contemplated by
Section 3.01 hereof, The Bank of New York Mellon, acting through its London Branch (or a successor thereof) will act as Paying Agent in respect of the Contingent Convertible Preferred Securities of any series. 

“Paying and Conversion Agent” means, when used with respect to the Contingent Convertible Preferred Securities of any series,
the Principal Paying Agent and any other paying and conversion agent appointed in accordance with the Contingent Convertible Preferred Securities Indenture or any supplemental indenture with respect to such series and includes any successors thereto
appointed from time to time in accordance with the Contingent Convertible Preferred Securities Indenture or any such supplemental indenture. 

  
 12 

 “Payment Business Day” means (i) a day on which commercial banks and
foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in New York City and London and (ii) in the case of Contingent Convertible Preferred Securities in
definitive form only, a day on which commercial banks and foreign exchange markets settle payments and are open for general business (including dealing in foreign exchange and foreign currency deposits) in the relevant Place of Payment. 

“Payment Statement” means the statement to be delivered to the Company by the Trustee or the Paying Agent, as the case may
be, substantially in the form set forth in Exhibit I to Appendix 1, pursuant to Section 7.02. 
 “Performance
Obligation” has the meaning specified in Section 6.01. 
 “Person” means any individual, corporation,
partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivision thereof. 

“Place of Payment”, when used with respect to the Contingent Convertible Preferred Securities of any series, means the place
or places where the Liquidation Preference (and premium, if any) of and Distributions on, and any Additional Amounts with respect to, the Contingent Convertible Preferred Securities of that series are payable as specified pursuant to
Section 3.01 or, if not so specified, as specified in Section 11.02. 
 “Predecessor Security” of any particular
Contingent Convertible Preferred Security means every previous Contingent Convertible Preferred Security evidencing all or a portion of the same debt as that evidenced by such particular Contingent Convertible Preferred Security; and, for the
purposes of this definition, any Contingent Convertible Preferred Security authenticated and delivered under Section 3.06 in exchange for or in lieu of a mutilated, destroyed, lost or stolen Contingent Convertible Preferred Security shall be
deemed to evidence the same debt as the mutilated, destroyed, lost or stolen Contingent Convertible Preferred Security. 

“Prevailing Rate” means, in respect of any currencies on any day, the spot rate of exchange between the relevant currencies
prevailing as at 12 noon (London time) on that date as appearing on or derived from Reuters page ECB37 or, if not available, from any other Reference Page or, if such a rate cannot be determined at such time, the rate prevailing as at 12 noon
(London time) on the immediately preceding day on which such rate can be so determined or, if such rate cannot be so determined by reference to the Reference Page, the rate determined in such other manner as an Independent Financial Adviser in good
faith shall prescribe. 
 “Principal Paying Agent”, when used with respect to the Contingent Convertible Preferred
Securities of any series, means The Bank of New York Mellon, acting through its London Branch (or a successor thereof) except as otherwise specified as contemplated by Section 3.01 hereof. 

“RD 1012/2015” means Royal Decree 1012/2015 of November 6, by virtue of which Law 11/2015 is developed and Royal Decree
2606/1996 of December 20 on credit entities’ deposit guarantee fund is amended, as amended, replaced or supplemented from time to time. 

“Recognized Stock Exchange” means an organized, regularly operating, recognized stock exchange or securities market in a
country that is a member of the Organization for Economic Co-operation and Development (OECD). 

“Redemption Date”, when used with respect to any Contingent Convertible Preferred Security to be redeemed, means the date
fixed for such redemption by or pursuant to this Contingent Convertible Preferred Securities Indenture. 
 “Redemption
Price” means, per Contingent Convertible Preferred Security, the Liquidation Preference plus, if applicable, where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in
Section 3.08 and Section 3.09, an amount equal to any accrued and unpaid Distributions for the then current Distribution Period to (but excluding) the Redemption Date of the Contingent Convertible Preferred Securities of the relevant
series. 
 “Reference Date” means, in relation to a Retroactive Adjustment, the date as of which the relevant Retroactive
Adjustment takes effect or, if that date is not a dealing day, the succeeding dealing day. 

  
 13 

 “Reference Market Price” means, in respect of a Common Share at a particular
date, the arithmetic mean of the Closing Price per Common Share on each of the five consecutive dealing days on which such Closing Price is available ending on the dealing day immediately preceding such date, rounding the resulting figure to the
nearest cent (with 0.5 cents being rounded upwards). 
 “Reference Page” means the relevant page or any successor page on
Bloomberg or Reuters or any successor service or such other information service provider that displays the relevant information. 

“Regular Record Date” for the Distribution payable on any Distribution Payment Date on Contingent Convertible Preferred
Securities of any series means the date specified for such purpose pursuant to Section 3.01. 
 “Regulator” means the
European Central Bank or the Bank of Spain (Banco de España), as applicable, or such other or successor authority having primary bank supervisory authority, in each case, with respect to prudential matters in relation to the Company
and/or the Group from time to time. 
 “Relevant Spanish Resolution Authority” means the Spanish Fund for the Orderly
Restructuring of Banks (Fondo de Restructuración Ordenada Bancaria), the European Single Resolution Mechanism and, as the case may be, according to Law 11/2015, the Bank of Spain and the CNMV, and any other entity with the authority to
exercise the Spanish Bail-in Power from time to time. 
 “Relevant Stock Exchange”
means the Spanish Stock Exchanges or if at the relevant time the Common Shares are not at that time listed and admitted to trading on the Spanish Stock Exchanges, the principal stock exchange or securities market on which the Common Shares are then
listed, admitted to trading or quoted or accepted for dealing. 
 “Responsible Officer”, when used with respect to the
Trustee, means any officer of the Trustee who shall have direct responsibility for the administration of this Contingent Convertible Preferred Securities Indenture and, for the purposes of Section 7.01(c)(ii), shall also include any other
officer of the Trustee to whom any corporate trust matter is referred because of such officer’s knowledge of and familiarity with the particular subject. 

“Retroactive Adjustment” has the meaning specified in Section 4.05(d). 

“Risk Weighted Assets Amount” means at any time, with respect to the Company or the Group, as the case may be, the aggregate
amount (in the Accounting Currency) of the risk weighted assets of the Company or the Group, respectively, calculated in accordance with CRR and/or Applicable Banking Regulations at such time. 

“Scheme of Arrangement” has the meaning specified in the definition of “Newco Scheme”. 

“Securities” means any securities including, without limitation, shares in the capital of the Company, or options, warrants
or other rights to subscribe for or purchase or acquire shares in the capital of the Company. 
 “Securities Act” means the
United States Securities Act of 1933, as amended. 
 “Selling Agent” has the meaning specified in Section 4.09. 

“Share Currency” means euro or such other currency in which the Common Shares are quoted or dealt in on the Relevant Stock
Exchange at the relevant time or for the purposes of the relevant calculation or determination. 
 “Shareholders” means the
holders of Common Shares. 
 “Spanish Bail-in Power” means any write-down,
conversion, transfer, modification, or suspension power existing from time to time under: (a) any law, regulation, rule or requirement applicable from time to time in the Kingdom of Spain, relating to the transposition or development of the
BRRD, including, but not limited to (i) Law 11/2015, (ii) RD 1012/2015; and (iii) the SRM Regulation; or (b) any other law, regulation, rule or requirement applicable from time to time in the Kingdom of Spain pursuant to which
(i) obligations or liabilities of banks, investment firms or other financial institutions or their affiliates can be reduced, cancelled, modified, transferred or converted into shares, other securities, or other obligations of such Persons or
any other Person (or suspended for a temporary period or permanently) or (ii) any right in a contract governing such obligations may be deemed to have been exercised. 

  
 14 

 “Spanish Companies Act” means the Royal Legislative Decree 1/2010, of
July 2, approving the consolidated text of the Spanish Companies Act (Ley de Sociedades de Capital), as amended, replaced or supplemented from time to time. 

“Spanish Insolvency Law” means Law 22/2003 (Ley Concursal) of July 9, regulating insolvency proceedings in Spain,
as amended or supplemented from time to time, or an equivalent legal provision which replaces it in the future. 
 “Spanish Stock
Exchanges” means the Madrid, Barcelona, Bilbao and Valencia stock exchanges and the Automated Quotation System -Continuous Market (Sistema de Interconexión Bursátil Español (SIBE) - Mercado Continuo). 

“Spin-Off” means: 

 

	 	(a)	a distribution of Spin-Off Securities by the Company to Shareholders as a class; or 

  

	 	(b)	any issue, transfer or delivery of any property or assets (including cash or shares or other securities of or in or issued or allotted by any entity) by any entity (other than the Company) to Shareholders as a class or,
in the case of or in connection with a Newco Scheme, Existing Shareholders as a class (but excluding the issue and allotment of ordinary shares (or depositary or other receipts or certificates representing such ordinary shares) by Newco to Existing
Shareholders as a class), pursuant in each case to any arrangements with the Company or any member of the Group. 

 “Spin-Off Securities” means equity share capital of an entity other than the Company or options, warrants or other rights to subscribe for or purchase equity share capital of an entity other than the
Company. 
 “SRM Regulation” means Regulation (EU) No. 806/2014 of the European Parliament and of the Council of
July 15, establishing uniform rules and a uniform procedure for the resolution of credit institutions and certain investment firms in the framework of the Single Resolution Mechanism and the Single Resolution Fund and amending Regulation (EU)
No. 1093/2010, as amended, replaced or supplemented from time to time. 
 “SSM Regulation” means Council Regulation
(EU) No. 1024/2013 of October 15, conferring specific tasks on the European Central Bank concerning policies relating to the prudential supervision of credit institutions. 

“Subsidiary” means any entity over which the Company may have, directly or indirectly, control in accordance with Article 42
of the Spanish Commercial Code (Código de Comercio) and/or Applicable Banking Regulations. 
 “successor
corporation” has the meaning specified in Section 9.02. 
 “successor entity” has the meaning specified in
Section 9.03. 
 “successor Person” means a successor corporation or a successor entity, as the case may be. 

“Tax Event” in respect of any series of Contingent Convertible Preferred Securities, means that as a result of any change in,
or amendment to, the laws or regulations applicable in the Kingdom of Spain (except as provided in Section 9.02 and Section 9.03), or any change in the application or binding official interpretation or administration of any such laws
or regulations which change or amendment, or change in the application or binding official interpretation or administration, becomes effective on or after the date of issue of the Contingent Convertible Preferred Securities of such series
(a) the Company would not be entitled to claim a deduction in computing its 

  
 15 

 taxation liabilities in Spain (or, following any of the transactions referred to in Section 9.01 or an
assumption of obligations pursuant to Section 9.03, the successor Person’s jurisdiction of incorporation or tax residence) in respect of any Distribution to be made on the next Distribution Payment Date or the value of such deduction to
the Company would be materially reduced, or (b) the Company would be required to pay Additional Amounts pursuant to Section 11.04, or (c) the applicable tax treatment of the Contingent Convertible Preferred Securities of such series
would be materially affected. 
 “Tier 1 Capital” means at any time, with respect to the Company or the Group, as the case
may be, the Tier 1 capital of the Company or the Group, respectively, as calculated by the Company in accordance with Chapters 1, 2 and 3 (Tier 1 capital, Common Equity Tier 1 capital and Additional Tier 1 capital) of Title I (Elements of own funds)
of Part Two (Own Funds) of the CRR and/or Applicable Banking Regulations at such time, including any applicable transitional, phasing in or similar provisions. 

“Trigger Conversion” has the meaning specified in Section 4.01. 

“Trigger Event” in respect of any series of Contingent Convertible Preferred Securities, means if, at any time, as determined
by the Company, the CET1 ratio of the Company or the Group is less than 5.125%. 
 “Trigger Event Notice” has the meaning
specified in Section 4.06(a). 
 “Trigger Event Notice Date” means the date on which a Trigger Event Notice is deemed
to be given in accordance with Section 4.06(d). 
 “Trustee” means the Person named as the “Trustee” in the
first paragraph of this Contingent Convertible Preferred Securities Indenture until a successor trustee shall have become such pursuant to the applicable provisions of this Contingent Convertible Preferred Securities Indenture, and thereafter
“Trustee” shall mean the Person who is then the Trustee hereunder, or, if a different Trustee is appointed for a particular series of Contingent Convertible Preferred Securities, the Trustee named in the relevant indenture supplemental
hereto as the Trustee for that particular series of Contingent Convertible Preferred Securities and if at any time there is more than one such Person, “Trustee” shall mean and include each such Person; and “Trustee” as used with
respect to the Contingent Convertible Preferred Securities of any series shall mean the Trustee with respect to the Contingent Convertible Preferred Securities of such series; provided that the Trustee shall not be the Company or any other
obligor of the Contingent Convertible Preferred Securities or any Affiliate of the Company or such other obligor. 
 “Trust
Indenture Act” means the Trust Indenture Act of 1939, as amended, and any reference herein to the Trust Indenture Act or a particular provision thereof shall mean such Act or provision, as the case may be, as amended, replaced or
supplemented from time to time by rules or regulations adopted by the Commission under or in furtherance of the purposes of such Act or provision, as the case may be. 

“United States” and “U.S.” mean the United States of America (including the states thereof and the
District of Columbia) and, except in the case of Sections 7.10 and 7.15, its territories and possessions (including Puerto Rico, the U.S. Virgin Islands, Guam, American Samoa, Wake Island and the Northern Mariana Islands). 

“U.S.$” and “U.S. dollars” means the lawful currency of the United States of America which as at the time of
payment is legal tender for the payment of public and private debts. 
 “Volume Weighted Average Price” means, in respect
of a Common Share, Security or, as the case may be, a Spin-Off Security on any dealing day, the order book volume-weighted average price of a Common Share, Security or, as the case may be, a Spin-Off Security published by or derived (in the case of a Common Share) from the Reference Page or (in the case of a Security (other than Common Shares) or Spin-Off
Security) from the principal stock exchange or securities market on which such Securities or Spin-Off Securities are then listed or quoted or dealt in, if any or, in any such case, such other source as shall
be determined in good faith to be appropriate by an Independent Financial Adviser on such dealing day, provided that if on any such dealing day such price is not available or cannot otherwise be determined as provided above, the Volume
Weighted Average Price of a Common Share, Security or a Spin-Off Security, as the case may be, in respect of such dealing day shall be the Volume Weighted Average Price, determined as provided above, on the
immediately preceding dealing day on which the same can be so determined or as an Independent Financial Adviser might otherwise determine in good faith to be appropriate. 

  
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 In making any calculation or determination of Current Market Price or Volume Weighted Average
Price, such adjustments (if any) shall be made as an Independent Financial Adviser determines in good faith appropriate to reflect any consolidation or sub-division of the Common Shares or any issue of Common
Shares by way of capitalization of profits or reserves, or any like or similar event. 
 “Voting Rights” means the right
generally to vote at a general meeting of Shareholders of the Company (irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency). 

Section 1.02. Compliance Certificates and Opinions. Except as otherwise expressly provided for in this Contingent Convertible
Preferred Securities Indenture, upon any application or request by the Company to the Trustee to take any action under any provision of this Contingent Convertible Preferred Securities Indenture, the Company shall furnish to the Trustee an
Officer’s Certificate stating that all conditions precedent, if any, provided for in this Contingent Convertible Preferred Securities Indenture relating to the proposed action have been complied with and an Opinion of Counsel stating that, in
the opinion of the legal advisor rendering such opinion, all such conditions precedent, if any, have been complied with, except that in the case of any such application or request as to which the furnishing of such documents or any of them is
specifically required by any provision of this Contingent Convertible Preferred Securities Indenture relating to such particular application or request, no additional certificate or opinion need be furnished. 

Section 1.03. Form of Documents Delivered to Trustee. In any case where several matters are required to be certified by, or
covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may
certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents. 

Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion
of, or representations by, legal advisors, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based
are erroneous. Any such certificate or opinion of, or representations by, legal advisors may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating
that the information with respect to such factual matters is in the possession of the Company, unless such legal advisors know, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to
such matters are erroneous. 
 Where any Person is required to make, give or execute two or more applications, requests, consents,
certificates, statements, opinions or other instruments under this Contingent Convertible Preferred Securities Indenture or any Contingent Convertible Preferred Security, they may, but need not, be consolidated and form one instrument. 

Section 1.04. Acts of Holders. 

(a) Except as otherwise provided under this Contingent Convertible Preferred Securities Indenture or the Trust Indenture Act, any request,
demand, authorization, direction, notice, consent, waiver or other action provided by or pursuant to this Contingent Convertible Preferred Securities Indenture to be given or taken by Holders of Contingent Convertible Preferred Securities of a
series may be embodied in and evidenced by one or more written instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing; and, except as herein otherwise expressly provided, such action
shall become effective when such instrument or instruments are delivered to the Trustee and, when it is hereby expressly required, to the Company. Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein 

  
 17 

 sometimes referred to as the “Act” of the Holders signing such instrument or instruments. Proof
of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Contingent Convertible Preferred Securities Indenture and (subject to Section 7.01) conclusive in favor of the Trustee,
the Company and any agent of the Trustee or the Company, if made in the manner provided in this Section. 
 (b) The fact and date of the
execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the
individual signing such instrument or writing acknowledged to him the execution thereof. Where such execution is by a signer acting in a capacity other than his individual capacity, such certificate or affidavit shall also constitute sufficient
proof of his authority. The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient. 

(c) The ownership, principal amount and serial numbers of Contingent Convertible Preferred Securities held by any Person, and the date of the
commencement and the date of the termination of holding the same, shall be proved by the Contingent Convertible Preferred Security Register. 

(d) Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Contingent Convertible Preferred
Security shall bind every future Holder of the same Contingent Convertible Preferred Security and the Holder of every Contingent Convertible Preferred Security issued upon the registration of transfer thereof or in exchange therefor or in lieu
thereof in respect of anything done, omitted or suffered to be done by the Trustee, any Contingent Convertible Preferred Security Registrar, any Paying Agent, any Authenticating Agent, any Calculation Agent, any Paying and Conversion Agent or the
Company in reliance thereon, whether or not notation of such request, demand, authorization, direction, notice, consent, waiver or other action is made upon such Contingent Convertible Preferred Security. 

(e) The Company may set any day as a record date for the purpose of determining the Holders of Outstanding Contingent Convertible Preferred
Securities of a series entitled to give, make or take any request, demand, authorization, direction, notice, consent, waiver or other action (including an Act) provided or permitted by this Contingent Convertible Preferred Securities Indenture to be
given, made or taken by Holders of Contingent Convertible Preferred Securities of such series; provided that the Company may not set a record date for, and the provisions of this Section 1.04(e) shall not apply with respect to, the
giving or making of any notice, declaration, request or direction referred to in Section 1.04(f). If any record date is set pursuant to this Section 1.04(e), the Holders of Outstanding Contingent Convertible Preferred Securities of the
relevant series on such record date, and no other Holders, shall be entitled to take the relevant action, whether or not such Holders remain Holders after such record date; provided that no such action shall be effective hereunder unless
taken on or prior to the applicable Expiration Date (as defined below) by Holders of the requisite principal amount of Outstanding Contingent Convertible Preferred Securities of such series on such record date. Nothing in this Section 1.04(e)
shall be construed to prevent the Company from setting a new record date for any action for which a record date has previously been set pursuant to this Section 1.04(e) (whereupon the record date previously set shall automatically and with no
action by any Person be cancelled and of no effect), and nothing in this Section 1.04(e) shall be construed to render ineffective any action taken by Holders of the requisite principal amount of Outstanding Contingent Convertible Preferred
Securities of the relevant series on the date such action is taken. Promptly after any record date is set pursuant to this Section 1.04(e), the Company, at its own expense, shall cause notice of such record date, the proposed action by Holders
and the applicable Expiration Date to be given to the Trustee in writing and to each Holder of Contingent Convertible Preferred Securities of the relevant series in the manner set forth in Section 1.06. 

(f) The Trustee may set any day as a record date for the purpose of determining the Holders of Outstanding Contingent Convertible Preferred
Securities of any series entitled to join in the giving or making of: (i) any Liquidation Distribution referred to in Section 6.02; (ii) any request to institute proceedings referred to in Section 6.09(b); or (iii) any direction
referred to in Section 6.14, in each case with respect to Contingent Convertible Preferred Securities of such series. If any record date is set pursuant to this Section 1.04(f), the Holders of Outstanding Contingent Convertible Preferred
Securities of such series on such record date, and no other Holders, shall be entitled to join in such notice, declaration, request or direction, whether or not such Holders remain Holders after such record date; provided that no such action
shall be effective hereunder unless taken on or prior to the 

  
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 applicable Expiration Date by Holders of the requisite principal amount of Outstanding Contingent Convertible
Preferred Securities of such series on such record date. Nothing in this Section 1.04(f) shall be construed to prevent the Trustee from setting a new record date for any action for which a record date has previously been set pursuant to this
Section 1.04(f) (whereupon the record date previously set shall automatically and with no action by any Person be cancelled and of no effect), and nothing in this Section 1.04(f) shall be construed to render ineffective any action taken by
Holders of the requisite principal amount of Outstanding Contingent Convertible Preferred Securities of the relevant series on the date such action is taken. Promptly after any record date is set pursuant to this Section 1.04(f), the Trustee,
at the expense of the Company, shall cause notice of such record date, the proposed action by Holders and the applicable Expiration Date to be given to the Company in writing and to each Holder of Contingent Convertible Preferred Securities of the
relevant series in the manner set forth in Section 1.06. 
 (g) With respect to any record date set pursuant to this Section with
respect to the Contingent Convertible Preferred Securities of a series, the party or parties hereto which set such record date may designate any day as the “Expiration Date” and from time to time may change the Expiration Date to
any earlier or later day; provided that no such change shall be effective unless notice of the proposed new Expiration Date is given to the other party or parties hereto in writing, and to each Holder of Contingent Convertible Preferred
Securities of the relevant series in the manner set forth in Section 1.06, on or prior to the existing Expiration Date. Notwithstanding the foregoing, no Expiration Date shall be designated later than the 180th day after the applicable record
date and, if an Expiration Date is not designated, with respect to any record date set pursuant to this Section, the party or parties hereto which set such record date shall be deemed to have designated the 180th day after such record date as the
Expiration Date with respect thereto. 
 Section 1.05. Notices, Etc. to Trustee and Company. 

(a) Any request, demand, authorization, direction, notice, consent, waiver or record of an Act of Holders or other document provided or
permitted by this Contingent Convertible Preferred Securities Indenture to be made upon, given or furnished to, or filed with, the Trustee by any Holder, or any request, demand, authorization, direction, notice, consent or waiver by the Company,
shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing to or with the Trustee at its Corporate Trust Office. 

(b) Any record of an Act of Holders or other document provided or permitted by this Contingent Convertible Preferred Securities Indenture to be
made upon, given or furnished to, or filed with, the Company by the Trustee or any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the
Company addressed to the attention of Financial Department at Calle Azul 4, 28050 Madrid, Spain (finance.department@bbva.com), or at any other address previously furnished in writing to the Trustee by the Company. 

Notwithstanding the above, the Trustee agrees to accept and act upon instructions or directions pursuant to this Contingent Convertible
Preferred Securities Indenture sent by unsecured e-mail, portable document format (PDF), facsimile transmission or other similar unsecured electronic methods, provided, however, that the Trustee shall
have received from the Company an incumbency certificate listing persons designated to give such instructions or directions and containing the titles and specimen signatures of such designated persons, which such incumbency certificate shall be
amended and replaced whenever a person is to be added or deleted from the listing. 
 Notwithstanding the above, any notice, communication
or other document delivered pursuant to the procedures set forth in Appendix 1, including a Payment Statement, shall be given in accordance with the procedures set forth in such Appendix 1. 

Section 1.06. Notice to Holders; Waiver. 

(a) Except as otherwise expressly provided in or pursuant to this Contingent Convertible Preferred Securities Indenture, where this Contingent
Convertible Preferred Securities Indenture provides for notice to Holders of Contingent Convertible Preferred Securities of any event, such notice shall be sufficiently given to Holders of Contingent Convertible Preferred Securities if in writing
and mailed, first-class postage prepaid, to each Holder of a Contingent Convertible Preferred Security affected by such event, at his address as it appears in the Contingent Convertible Preferred Security Register, not later than the latest date,
and not earlier than the earliest date, prescribed for the giving of such notice. Notwithstanding the foregoing, any notice given to the Holder of a Global Security shall be sufficiently given if such notice is given in accordance with the
applicable procedures of the relevant Depositary. 

  
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 (b) Any notice which is given in the manner provided in this Section 1.06 shall be
conclusively presumed to have been duly given or provided, whether or not such Holder receives the notice. Without limiting the generality of the foregoing, in any case where notice to Holders of Contingent Convertible Preferred Securities is given
by mail as provided by this Section 1.06, neither the failure to mail such notice, nor any defect in any notice so mailed, to any particular Holder of a Contingent Convertible Preferred Security shall affect the sufficiency of such notice with
respect to other Holders of Contingent Convertible Preferred Securities. In the case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as
shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder. 
 (c) Where this
Contingent Convertible Preferred Securities Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of
such notice. Waivers of notice by Holders of Contingent Convertible Preferred Securities shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver. 

Section 1.07. Language of Notices, Etc. Any request, demand, authorization, direction, notice, consent, election or waiver
required or permitted under this Contingent Convertible Preferred Securities Indenture shall be in the English language, except that, if the Company so elects, any published notice may be in an official language of the country of publication. 

Section 1.08. Conflict with Trust Indenture Act. If any provision hereof limits, qualifies or conflicts with a provision of the
Trust Indenture Act that is required under the Trust Indenture Act to be a part of and govern this Contingent Convertible Preferred Securities Indenture, the provision of the Trust Indenture Act shall control. If at any future time any provision
required to be included herein by the Trust Indenture Act as in force at the date as of which this Contingent Convertible Preferred Securities Indenture was executed or any limitation imposed by the Trust Indenture Act at such date on any provision
otherwise included herein would not be so required or imposed (in whole or in part) if this Contingent Convertible Preferred Securities Indenture were executed at such future time, the Company and the Trustee may enter into one or more indentures
supplemental hereto pursuant to Section 10.01 to change or eliminate (in whole or in part) such provision or limitation of this Contingent Convertible Preferred Securities Indenture in conformity with the requirements of the Trust Indenture Act
as then in force, except that (subject to Article 10) no provision or limitation required to be included herein by Sections 310(a)(1) and (a)(2), 315(a), (c), (d)(l), (d)(2), (d)(3) and (e), 316(a)(1)(A), (a)(l)(B), (a)(2), (a) (last sentence) and
(b) of the Trust Indenture Act as in force at the date as of which this Contingent Convertible Preferred Securities Indenture was executed may be so changed or eliminated. 

Section 1.09. Effect of Headings and Table of Contents. The Article and Section headings herein and the Table of Contents are for
convenience only and shall not affect the construction hereof. 
 Section 1.10. Successors and Assigns. All covenants and
agreements in this Contingent Convertible Preferred Securities Indenture made by the Company shall bind its successors and assigns, whether so expressed or not. 

Section 1.11. Separability Clause. In case any provision in this Contingent Convertible Preferred Securities Indenture or in any
Contingent Convertible Preferred Security shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby. 

Section 1.12. Benefits of Contingent Convertible Preferred Securities Indenture. Nothing in this Contingent Convertible Preferred
Securities Indenture or in any Contingent Convertible Preferred Security, express or implied, shall give to any Person, other than the parties hereto and any Contingent Convertible Preferred Security Registrar, Paying Agent, Paying and Conversion
Agent or Calculation Agent with respect to any Contingent Convertible Preferred Security and their successors hereunder, and the Holders of Contingent Convertible Preferred Securities, any benefit or any legal or equitable right, remedy or claim
under this Contingent Convertible Preferred Securities Indenture. 

  
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 Section 1.13. Governing Law. This Contingent Convertible Preferred Securities
Indenture and the Contingent Convertible Preferred Securities (except as set forth herein and therein) shall be governed by and construed in accordance with the laws of the State of New York applicable to agreements made or instruments entered into
and, in each case, performed in said state, except that the authorization and execution by the Company of this Contingent Convertible Preferred Securities Indenture, the authorization, issuance and execution by the Company of the Contingent
Convertible Preferred Securities and Section 13.01(a) hereof shall be governed by and construed in accordance with the laws of the Kingdom of Spain. 

Section 1.14. Business Days. In any case where any Distribution Payment Date or Redemption Date of a Contingent Convertible
Preferred Security shall not be a Business Day at any Place of Payment, then (notwithstanding any other provision of this Contingent Convertible Preferred Securities Indenture or the Contingent Convertible Preferred Securities other than a provision
in the Contingent Convertible Preferred Securities that specifically states that such provision shall apply in lieu of this Section) payments of Liquidation Preference (and premium, if any), Distributions and/or Additional Amounts, as the case may
be, need not be made at such Place of Payment on such date, but may be made on the next succeeding Business Day at such Place of Payment (or such other Business Day as shall be provided in such Contingent Convertible Preferred Security) with the
same force and effect as if made on such Distribution Payment Date or Redemption Date, provided that no interest shall accrue on such payment for the period from and after such Distribution Payment Date or Redemption Date, as the case may be.

 Section 1.15. Appointment of Agent for Service. The Company has designated and appointed Banco Bilbao Vizcaya Argentaria,
S.A., New York Branch, 1345 Avenue of the Americas, 45th Floor, New York, New York 10105, as its authorized agent (the “Authorized Agent”), upon which process may be served in any suit or proceeding in any U.S. Federal or State
court in the Borough of Manhattan, The City of New York arising out of or relating to the Contingent Convertible Preferred Securities or this Contingent Convertible Preferred Securities Indenture, but for that purpose only, and agrees that service
of process upon said Authorized Agent shall be deemed in every respect effective service of process upon it in any such suit or proceeding in any U.S. Federal or State court in the Borough of Manhattan, The City of New York, New York. Such
appointment shall be irrevocable so long as any of the Contingent Convertible Preferred Securities remain Outstanding until the appointment of a successor by the Company and such successor’s acceptance of such appointment. Upon such acceptance,
the Company shall notify the Trustee of the name and address of such successor. The Company further agrees to take any and all action, including the execution and filing of any and all such documents and instruments, as may be necessary to continue
such designation and appointment of said Authorized Agent in full force and effect so long as any of the Contingent Convertible Preferred Securities shall be Outstanding. The Trustee shall not be obligated and shall have no responsibility with
respect to any failure by the Company to take any such action. The Company hereby submits (for the purposes of any such suit or proceeding) to the jurisdiction of any such court in which any such suit or proceeding is so instituted, and waives, to
the extent it may effectively do so, any objection it may have now or hereafter to the laying of the venue of any such suit or proceeding. 

Section 1.16. Calculation Agent. Any determination of the Distribution Rate on, or other amounts in relation to, a series of
Contingent Convertible Preferred Securities to be calculated in accordance with the terms of such series of Contingent Convertible Preferred Securities by the Calculation Agent shall (in the absence of manifest error, bad faith or willful
misconduct) be binding on the Company, the Paying Agent, the Trustee and all Holders and (in the absence of manifest error, bad faith or willful misconduct) no liability to the Holders shall attach to the Calculation Agent in connection with the
exercise or non-exercise by it of its powers, duties and discretions. 
 Section 1.17.
Waiver of Jury Trial. EACH OF THE PARTIES HERETO, AND EACH HOLDER OF A CONTINGENT CONVERTIBLE PREFERRED SECURITY BY ITS ACCEPTANCE THEREOF, HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO
TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS CONTINGENT CONVERTIBLE PREFERRED SECURITIES INDENTURE, THE CONTINGENT CONVERTIBLE PREFERRED SECURITIES OR ANY TRANSACTION CONTEMPLATED HEREBY. 

  
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 Section 1.18. Judgment Currency. Any payment on account of an amount that is payable
in U.S. dollars (the “Required Currency”) which is made to or for the account of any Holder or the Trustee in lawful currency of any other jurisdiction (the “Judgment Currency”), whether as a result of any judgment
or order or the enforcement thereof or the liquidation of the Company shall constitute a discharge of the Company obligation under this Contingent Convertible Preferred Securities Indenture and the Contingent Convertible Preferred Securities only to
the extent of the amount of the Required Currency such Holder or the Trustee, as the case may be, could purchase in the London foreign exchange markets with the amount of the Judgment Currency in accordance with normal banking procedures at the rate
of exchange prevailing on the first Business Day following receipt of the payment in the Judgment Currency. If the amount of the Required Currency that could be so purchased is less than the amount of the Required Currency originally due to such
Holder or the Trustee, as the case may be, the Company shall indemnify and hold harmless the Holder or the Trustee, as the case may be, from and against all loss or damage arising out of, or as a result of, such deficiency. This indemnity shall
constitute an obligation separate and independent from the other obligations contained in this Contingent Convertible Preferred Securities Indenture or the Contingent Convertible Preferred Securities, shall give rise to a separate and independent
cause of action, shall apply irrespective of any indulgence granted by any Holder or the Trustee from time to time and shall continue in full force and effect notwithstanding any judgment or order for a liquidated sum in respect of an amount due
hereunder or under any judgment or order. 
 ARTICLE 2 

CONTINGENT CONVERTIBLE PREFERRED SECURITY FORMS 

Section 2.01. Forms Generally. The Contingent Convertible Preferred Securities of each series shall be issuable in registered form
and in such forms as shall be established by or pursuant to a Board Resolution, an Officer’s Certificate, or in one or more indentures supplemental hereto, pursuant to Section 3.01, in each case with such insertions, omissions,
substitutions and other variations as are required or permitted by this Contingent Convertible Preferred Securities Indenture, and may have such letters, numbers or other marks of identification and such legends or endorsements placed thereon as may
be required to comply with any applicable law or rule or regulation made pursuant thereto or with the rules of any securities exchange or Depositary therefor, or as may, consistently herewith, be determined by the officers executing such Contingent
Convertible Preferred Securities, all as evidenced by any such execution. 
 Section 2.02. Form of Trustee’s
Certificate of Authentication. The Trustee’s certificate of authentication shall be in substantially the following form: 

CERTIFICATE OF AUTHENTICATION 

This is one of the Contingent Convertible Preferred Securities of the series designated herein referred to in the within-mentioned Contingent
Convertible Preferred Securities Indenture. 
  

			
	 Dated:
	 	  

	  
 THE BANK OF NEW
YORK MELLON, as Trustee
  

	By:	 	  

		 	Authorized Signatory

  
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 ARTICLE 3 

THE CONTINGENT CONVERTIBLE PREFERRED SECURITIES 

Section 3.01. Amount Unlimited; Issuable in Series. The aggregate Liquidation Preference of Contingent Convertible Preferred
Securities which may be authenticated and delivered under this Contingent Convertible Preferred Securities Indenture is unlimited. The Contingent Convertible Preferred Securities may be issued in one or more series. The Contingent Convertible
Preferred Securities shall be subordinated in right of payment as provided in Article 13. 
 There shall be established by or pursuant to a
Board Resolution, an Officer’s Certificate or in one or more indentures supplemental hereto, prior to the initial issuance of Contingent Convertible Preferred Securities of any series, 

(a) the title of the Contingent Convertible Preferred Securities of the series (which shall distinguish the Contingent Convertible Preferred
Securities of the series from all other Contingent Convertible Preferred Securities); 
 (b) any limit upon the aggregate Liquidation
Preference of the Contingent Convertible Preferred Securities of the series which may be authenticated and delivered under this Contingent Convertible Preferred Securities Indenture (except for Contingent Convertible Preferred Securities
authenticated and delivered upon registration of transfer of, or in exchange for, or in lieu of, other Contingent Convertible Preferred Securities of the series pursuant to Section 3.04, Section 3.05, Section 3.06 or
Section 10.06 and except for any Contingent Convertible Preferred Securities which, pursuant to Section 3.03 are deemed never to have been authenticated and delivered hereunder); 

(c) the date or dates, if any, on which the Liquidation Preference of the Contingent Convertible Preferred Securities of the series is payable;

 (d) the rate or rates, if any, at which Distributions on the Contingent Convertible Preferred Securities of the series shall accrue or the
manner of calculation of such rate or rates, if any, the terms or circumstances under which any such Distributions may be cancelled, if any, the date or dates from which such Distributions shall accrue, the Distribution Payment Dates on which such
Distributions, if any, shall be payable or the manner of determination of such Distribution Payment Dates and the Regular Record Date for the Distributions, if any, payable on any Distribution Payment Date; 

(e) whether any premium, upon redemption or otherwise, shall be payable by the Company on Contingent Convertible Preferred Securities of the
series; 
 (f) the place or places where the Liquidation Preference (and premium, if any) of and any Distributions on Contingent Convertible
Preferred Securities of the series shall be payable, and the paying agent, if other than the Principal Paying Agent, who shall be authorized to pay Liquidation Preference (and premium, if any) of and any Distributions on Contingent Convertible
Preferred Securities of such series, at least one such paying agent having an office or agency in the Borough of Manhattan, The City of New York;  

(g) other than with respect to any redemption of the Contingent Convertible Preferred Securities pursuant to Sections 12.08, 12.09 or 12.10,
whether or not such series of Contingent Convertible Preferred Securities are to be redeemable, in whole or in part, at the Company’s option and, if so redeemable, the period or periods within which, the price or prices at which and the terms
and conditions upon which, Contingent Convertible Preferred Securities of the series may be redeemed; and any modification to the terms set forth in Sections 12.08, 12.09 or 12.10; 

(h) the obligation, if any, of the Company to redeem or purchase Contingent Convertible Preferred Securities of the series pursuant to any
sinking fund or analogous provisions or at the option of a Holder thereof and the period or periods within which, the price or prices at which, and the terms and conditions upon which Contingent Convertible Preferred Securities of the series shall
be redeemed or purchased, in whole or in part, pursuant to such obligation; 

  
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 (i) the denominations in which Contingent Convertible Preferred Securities of the series in each
applicable form shall be issuable and any provisions relating to redenomination of any Contingent Convertible Preferred Securities; 
 (j) if
Additional Amounts, pursuant to Section 11.04, shall not be payable, or any modification to the conditions under which Additional Amounts are payable; 

(k) if other than U.S. dollars, provisions, if any, for the Contingent Convertible Preferred Securities of the series to be denominated, and
payments thereon to be made, in Foreign Currencies and specifying the Place of Payment and the manner of payment thereon and any other terms with respect thereto; 

(l) if other than the coin or currency in which the Contingent Convertible Preferred Securities of that series are denominated, the coin or
currency in which payment of the Liquidation Preference (and premium, if any) of and Distributions on the Contingent Convertible Preferred Securities of such series shall be payable; 

(m) if the Liquidation Preference (and premium, if any) of and Distributions on the Contingent Convertible Preferred Securities of such series
are to be payable, at the election of the Company or a Holder thereof, in a coin or currency other than that in which the Contingent Convertible Preferred Securities are denominated, the period or periods within which, and the terms and conditions
upon which, such election may be made; 
 (n) whether the Contingent Convertible Preferred Securities of the series shall be issued in whole
or in part in the form of one or more Global Securities and the initial Holder with respect to such Global Security or Contingent Convertible Preferred Securities; 

(o) if the Contingent Convertible Preferred Securities of such series are to be issuable in definitive form (whether upon original issue or
upon exchange of a temporary Contingent Convertible Preferred Security of such series or otherwise) only upon receipt of certain certificates or other documents or satisfaction of other conditions, then the form and terms of such certificates,
documents or conditions; 
 (p) if the amounts of payments of the Liquidation Preference (and premium, if any) of or Distributions on the
Contingent Convertible Preferred Securities of the series may be determined with reference to an index or are otherwise not fixed on the original issue date thereof, the manner in which such amounts shall be determined and the Calculation Agent, if
any, who shall be appointed and authorized to calculate such amounts; 
 (q) the forms of Contingent Convertible Preferred Securities of the
series; 
 (r) the relevant Floor Price with respect to such series of Contingent Convertible Preferred Securities and any deletions from,
modifications of or additions to the anti-dilution adjustments applicable to such Floor Price; 
 (s) the Trustee for such series of
Contingent Convertible Preferred Securities who shall also be named in an indenture supplemental hereto for a particular series of Contingent Convertible Preferred Securities if the Trustee for such series is not the Trustee named in the first
paragraph of this Contingent Convertible Preferred Securities Indenture; 
 (t) any deletions from, modifications of or additions to the
Enforcement Events, Conversion terms, terms applicable to the assumption of the Company’s obligations by a successor Person or covenants of the Company with respect to such series of Contingent Convertible Preferred Securities; and 

(u) any other terms of such series of Contingent Convertible Preferred Securities which the Company may establish in accordance with Article
10. 

  
 24 

 All Contingent Convertible Preferred Securities of any one series shall be substantially
identical except as to denomination and except as may otherwise be provided in or pursuant to such Board Resolution or in any such Officer’s Certificate or indenture supplemental hereto pertaining to such series. The terms of the Contingent
Convertible Preferred Securities of any series may provide, without limitation, that such Contingent Convertible Preferred Securities shall be authenticated and delivered by the Trustee on original issue from time to time upon written order of
persons designated in the Officer’s Certificate or supplemental indenture and that such persons are authorized to determine, consistent with such Officer’s Certificate or any applicable supplemental indenture, such terms and conditions of
the Contingent Convertible Preferred Securities of such series as are specified in such Officer’s Certificate or supplemental indenture. All Contingent Convertible Preferred Securities of any one series need not be issued at the same time and,
unless otherwise so provided by the Company, a series may be reopened for issuances of additional Contingent Convertible Preferred Securities of such series or to establish additional terms of such series of Contingent Convertible Preferred
Securities. 
 If the forms of Contingent Convertible Preferred Securities of any series, or any of the terms thereof, are established by
action taken pursuant to a Board Resolution of the Company, a copy of the Board Resolution in respect thereof shall be delivered to the Trustee at or prior to the delivery of the Company Order pursuant to Section 3.03 for the authentication and
delivery of such Contingent Convertible Preferred Securities. 
 Section 3.02. Denominations. The Contingent Convertible
Preferred Securities of each series shall be issuable in such denominations as shall be specified as contemplated by Section 3.01. 

Section 3.03. Execution, Authentication, Delivery and Dating. The Contingent Convertible Preferred Securities shall be executed on
behalf of the Company by any of the representatives of the Company authorized to do so by Board Resolution or by any member of the Board of Directors. The signature of any of these authorized representatives on the Contingent Convertible Preferred
Securities may be manual or facsimile. 
 At any time and from time to time after the execution and delivery of this Contingent Convertible
Preferred Securities Indenture, the Company may deliver Contingent Convertible Preferred Securities of any series executed by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such
Contingent Convertible Preferred Securities and, if applicable, the Board Resolution specified in the final paragraph of Section 3.01, and the Trustee in accordance with the Company Order shall authenticate and deliver such Contingent
Convertible Preferred Securities. In authenticating such Contingent Convertible Preferred Securities and accepting the additional responsibilities under this Contingent Convertible Preferred Securities Indenture in relation to such Contingent
Convertible Preferred Securities the Trustee shall be entitled to receive, and (subject to Section 7.01) shall be fully protected in relying upon, an Opinion of Counsel and an Officer’s Certificate stating that the form and terms thereof
have been established in conformity with the provisions of this Contingent Convertible Preferred Securities Indenture. 
 If all the
Contingent Convertible Preferred Securities of any series are not to be issued at one time, it shall not be necessary to deliver an Opinion of Counsel and an Officer’s Certificate at the time of issuance of each Contingent Convertible Preferred
Security, but such opinion and certificate, with appropriate modifications, shall be delivered at or before the time of issuance of the first Contingent Convertible Preferred Security of such series. After any such first delivery, any separate
request by the Company that the Trustee authenticate Contingent Convertible Preferred Securities of such series for original issue will be deemed to be a certification by the Company that all conditions precedent provided for in this Contingent
Convertible Preferred Securities Indenture relating to authentication and delivery of such Contingent Convertible Preferred Securities continue to have been complied with. 

The Trustee shall not be required to authenticate such Contingent Convertible Preferred Securities if the issue of such Contingent Convertible
Preferred Securities pursuant to this Contingent Convertible Preferred Securities Indenture will affect the Trustee’s own rights, duties or immunities under the Contingent Convertible Preferred Securities and this Contingent Convertible
Preferred Securities Indenture or otherwise be in a manner which is not reasonably acceptable to the Trustee. 
 Each Contingent Convertible
Preferred Security shall be dated the date of its authentication. 

  
 25 

 No Contingent Convertible Preferred Security shall be entitled to any benefit under this
Contingent Convertible Preferred Securities Indenture or be valid or obligatory for any purpose unless there appears on such Contingent Convertible Preferred Security a certificate of authentication substantially in the form provided for herein
executed by or on behalf of the Trustee by manual signature, and such certificate upon any Contingent Convertible Preferred Security shall be conclusive evidence, and the only evidence, that such Contingent Convertible Preferred Security has been
duly authenticated and delivered hereunder and that such Contingent Convertible Preferred Security is entitled to the benefits of this Contingent Convertible Preferred Securities Indenture. Notwithstanding the foregoing, if any Contingent
Convertible Preferred Security shall have been authenticated and delivered hereunder but never issued and sold by the Company, and the Company shall deliver such Contingent Convertible Preferred Security to the Trustee for cancellation as provided
in Section 3.13, for all purposes of this Contingent Convertible Preferred Securities Indenture, such Contingent Convertible Preferred Security shall be deemed never to have been authenticated and delivered hereunder and shall never be entitled
to the benefit of this Contingent Convertible Preferred Securities Indenture. 
 Section 3.04. Temporary Contingent Convertible
Preferred Securities. Pending the preparation of definitive Contingent Convertible Preferred Securities of any series, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Contingent Convertible
Preferred Securities substantially of the tenor of the definitive Contingent Convertible Preferred Securities in lieu of which they are issued, which Contingent Convertible Preferred Securities may be printed, lithographed, typewritten, photocopied
or otherwise produced. Temporary Contingent Convertible Preferred Securities may be issued as registered Contingent Convertible Preferred Securities in any authorized denomination, and with such appropriate insertions, omissions, substitutions and
other variations as the officers executing such Contingent Convertible Preferred Securities may determine, all as evidenced by such execution. 

If temporary Contingent Convertible Preferred Securities of any series are issued, the Company will cause, if so required by the terms of such
temporary Contingent Convertible Preferred Securities, definitive Contingent Convertible Preferred Securities of such series to be prepared without unreasonable delay. After the preparation of definitive Contingent Convertible Preferred Securities
of such series, the temporary Contingent Convertible Preferred Securities of such series shall be exchangeable for definitive Contingent Convertible Preferred Securities of such series containing identical terms and provisions upon surrender of the
temporary Contingent Convertible Preferred Securities of such series at the office or agency of the Company in a Place of Payment for that series, without charge to the Holder. Upon surrender for cancellation of any one or more temporary Contingent
Convertible Preferred Securities of any series the Company shall execute, and the Trustee shall authenticate and deliver in exchange therefor, a like aggregate Liquidation Preference of definitive Contingent Convertible Preferred Securities of the
same series of authorized denominations containing identical terms and provisions. Until so exchanged, unless otherwise provided therein or in a supplemental indenture relating thereto, the temporary Contingent Convertible Preferred Securities of
any series shall in all respects be entitled to the same benefits (but shall be subject to all the limitations of rights) under this Contingent Convertible Preferred Securities Indenture as definitive Contingent Convertible Preferred Securities of
such series. 
 Section 3.05. Registration, Registration of Transfer and Exchange. 

(a) Global Securities. This Section 3.05(a) shall apply to Global Securities unless otherwise specified, as contemplated by
Section 3.01. 
 Except as otherwise specified as contemplated by Section 3.01 hereof, the Contingent Convertible Preferred
Securities shall be initially issued and represented by one or more Global Securities in registered form, which shall be authenticated as contemplated by this Contingent Convertible Preferred Securities Indenture. 

Each Global Security authenticated under this Contingent Convertible Preferred Securities Indenture shall be registered in the name of the
Depositary designated for such Global Security or a nominee thereof and delivered to such Depositary or a nominee thereof or custodian therefor, and each such Global Security shall constitute a single Contingent Convertible Preferred Security for
all purposes of this Contingent Convertible Preferred Securities Indenture. Except as otherwise specified as contemplated by Section 3.01 hereof, each Global Security authenticated under this Contingent Convertible Preferred Securities
Indenture shall be initially registered in the name of the relevant Depositary or its nominee only. 

  
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 Unless the Global Security is presented by an authorized representative of the Holder to the
Company or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of a nominee of the Holder or the Holder and any payment is made to such nominee or Holder, any transfer, pledge or other
use of the Global Security for value or otherwise shall be wrongful since the registered owner of such Global Security has an interest in such Global Security. 

Except as otherwise specified as contemplated by Section 3.01 hereof, any Global Security shall be exchangeable for definitive Contingent
Convertible Preferred Securities only as provided in this paragraph. A Global Security shall be exchangeable pursuant to this Section only (i) if the relevant Depositary notifies the Company that it is unwilling or unable to continue to act as
Depositary and a successor depositary is not appointed by the Company within 120 days of such notification, (ii) if, in the event of a winding-up of the Company, the Company fails to make a payment on the
Contingent Convertible Preferred Securities when due and payable or (iii) at any time if the Company at its option and in its sole discretion determines that the Global Securities of a particular series should be exchanged for definitive
Contingent Convertible Preferred Securities of that series. Any Global Security that is exchangeable pursuant to the preceding sentence shall be exchangeable for, unless otherwise specified or contemplated by Section 3.01, definitive Contingent
Convertible Preferred Securities bearing Distributions (if any) at the same rate or pursuant to the same formula, having the same date of issuance, the same date or dates from which such Distributions shall accrue, the same Distribution Payment
Dates or manner of determination of such Distribution Payment Dates, redemption provisions, if any, specified currency and other terms and of differing denominations aggregating a like amount as the Global Security so exchangeable. Definitive
Contingent Convertible Preferred Securities shall be registered in the names of the owners of the beneficial interests in such Global Securities as such names are from time to time provided by the Holder to the Trustee. 

Any Global Security that is exchangeable pursuant to the preceding paragraph, unless otherwise specified as contemplated by Section 3.01,
shall be exchangeable for Contingent Convertible Preferred Securities issuable in authorized denominations of a like aggregate Liquidation Preference and tenor. 

No Global Security may be transferred except as a whole by the Holder to a nominee of the Holder or by the Holder or any such nominee to a
successor of the Holder or a nominee of such successor. Except as provided above, owners solely of beneficial interests in a Global Security shall not be entitled to receive physical delivery of Contingent Convertible Preferred Securities in
definitive form and will not be considered the Holders thereof for any purpose under this Contingent Convertible Preferred Securities Indenture. 

In the event that a Global Security is surrendered for redemption in part pursuant to its terms, the Company shall execute, and the Trustee
shall authenticate and deliver to the Holder of such Global Security, without service charge, a new Global Security in a denomination equal to and in exchange for the unredeemed or unexchanged portion of the Liquidation Preference of the Global
Security so surrendered. 
 In the event that a Global Security is surrendered for conversion in part pursuant to its terms, the Company
shall execute, and the Trustee shall authenticate and deliver to the Holder of such Global Security, without service charge, a new Global Security in a denomination equal to and in exchange for the unconverted portion of the Liquidation Preference
of the Global Security so surrendered. 
 The Agent Members and any beneficial owners shall have no rights under this Contingent Convertible
Preferred Securities Indenture with respect to any Global Security held on their behalf by a Holder, and such Holder may be treated by the Company, the Trustee, and any agent of the Company or the Trustee as the owner of such Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall (i) prevent the Company, the Trustee, or any agent of the Company or the Trustee, from giving effect to any written certification, proxy or other authorization furnished
by a Holder or (ii) impair, as between any such Holder or other clearance service and its Agent Members and beneficial holders, the operation of customary practices governing the exercise of the rights of a holder of any security, including
without limitation the granting of proxies or other authorization of participants to give or take any request, demand, authorization, direction, notice, consent, waiver or other action which a Holder is entitled to give or take under this Contingent
Convertible Preferred Securities Indenture. 

  
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 In connection with any exchange of interests in a Global Security for definitive Contingent
Convertible Preferred Securities of another authorized form, as provided in this Section 3.05(a), then without unnecessary delay but in any event not later than the earliest date on which such interests may be so exchanged, the Company shall
deliver to the Trustee definitive Contingent Convertible Preferred Securities in aggregate Liquidation Preference equal to the Liquidation Preference of such Global Security or the portion to be exchanged, executed by the Company. On or after the
earliest date on which such interests may be so exchanged, such Global Security shall be surrendered by the Holder to the Trustee, as the Company’s agent for such purpose, to be exchanged, in whole or from time to time in part, for definitive
Contingent Convertible Preferred Securities without charge (in which case the Company or Trustee may require payment of any taxes or governmental charges arising) and the Trustee shall authenticate and deliver, in exchange for each portion of such
Global Security, an equal aggregate Liquidation Preference of definitive Contingent Convertible Preferred Securities of authorized denominations as the portion of such Global Security to be exchanged. Any Global Security that is exchangeable
pursuant to this Section 3.05 shall be exchangeable for Contingent Convertible Preferred Securities issuable in the denominations specified as contemplated by Section 3.01 and registered in such names as the Holder of such Global Security
shall direct. If a definitive Contingent Convertible Preferred Security is issued in exchange for any portion of a Global Security after the close of business at the office or agency where such exchange occurs on any record date and before the
opening of business at such office or agency on the relevant Distribution Payment Date, Distributions will not be payable on such Distribution Payment Date in respect of such definitive Contingent Convertible Preferred Security, but will be payable
(where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) on such Distribution Payment Date only to the Person to whom Distributions in respect of
such portion of such Global Security are payable. 
 A Depositary may grant proxies and otherwise authorize any Person, including Agent
Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Contingent Convertible Preferred Securities Indenture with respect to the Contingent Convertible Preferred
Securities. 
 (b) Except as otherwise specified pursuant to Section 3.01, Contingent Convertible Preferred Securities of any series
may only be exchanged for a like aggregate Liquidation Preference of Contingent Convertible Preferred Securities of such series of other authorized denominations containing identical terms and provisions. Contingent Convertible Preferred Securities
to be exchanged shall be surrendered at an office or agency of the Company designated pursuant to Section 11.02 for such purpose, and the Company shall execute, and the Trustee shall authenticate and deliver, in exchange therefor the Contingent
Convertible Preferred Security or Contingent Convertible Preferred Securities of the same series which the Holder making the exchange shall be entitled to receive. 

Except as otherwise specified pursuant to Section 3.01, the Company shall cause to be kept a register in the Contingent Convertible
Preferred Security Registrar’s principal corporate trust office in New York (the register being herein sometimes referred to as the “Contingent Convertible Preferred Security Register”) in which, subject to such reasonable
regulations as it may prescribe, the Company shall provide for the registration of Contingent Convertible Preferred Securities and of transfers of such Contingent Convertible Preferred Securities. Except as otherwise specified pursuant to
Section 3.01, The Bank of New York Mellon, acting through its principal corporate trust office in New York, is hereby appointed “Contingent Convertible Preferred Security Registrar” for the purpose of registering Contingent
Convertible Preferred Securities and transfers of Contingent Convertible Preferred Securities as herein provided. 
 Contingent Convertible
Preferred Securities shall be transferable only on the Contingent Convertible Preferred Security Register. Upon surrender for registration of transfer of any Contingent Convertible Preferred Security of any series, together with the form of transfer
endorsed on it, duly completed and executed at an office or agency of the Company designated pursuant to Section 11.02 for such purpose, the Company shall execute, and the Trustee shall authenticate and deliver to the address specified in the
form of transfer, within three Business Days, in the name of the designated transferee or transferees, one or more new Contingent Convertible Preferred Securities of the same series of any authorized denominations containing identical terms and
provisions, of a like aggregate Liquidation Preference. If only part of a Contingent Convertible Preferred Security is transferred, a new Contingent Convertible Preferred Security of an aggregate Liquidation Preference equal to the amount not being
transferred shall be executed by the Company, and authenticated and delivered by the Trustee to the transferor, in the name of the transferor, within three Business Days of receiving the Contingent Convertible Preferred Security. The new Contingent
Convertible Preferred Security will be delivered to the transferor by uninsured post at the risk of the 

  
 28 

 
transferor to the address of the transferor appearing in the Contingent Convertible Preferred Security Register. A new Contingent Convertible Preferred Security of an aggregate Liquidation
Preference equal to the amount being transferred shall be delivered by the Trustee to the transferee, in the name of the transferee, within three Business Days of receiving the Contingent Convertible Preferred Security. The new Contingent
Convertible Preferred Security will be delivered to the transferee by uninsured post at the risk of the transferee to the address of the transferee specified in the form of transfer. 

All Contingent Convertible Preferred Securities issued upon any registration of transfer or exchange of Contingent Convertible Preferred
Securities shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Contingent Convertible Preferred Securities Indenture, as the Contingent Convertible Preferred Securities surrendered
upon such registration of transfer or exchange. 
 Every Contingent Convertible Preferred Security presented or surrendered for registration
of transfer or for exchange shall (if so required by the Company or the Contingent Convertible Preferred Security Registrar) be duly endorsed, or be accompanied by a written instrument of transfer in form satisfactory to the Company and the
Contingent Convertible Preferred Security Registrar duly executed, by the Holder thereof or his attorney duly authorized in writing. 
 No
service charge shall be made for any registration of transfer or exchange of Contingent Convertible Preferred Securities, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge and any other expense
(including fees and expenses of the Trustee) that may be imposed in connection with any registration of transfer or exchange of Contingent Convertible Preferred Securities, other than exchanges pursuant to Section 3.04 or 10.06 not involving
any transfer. 
 The Company shall not be required (i) if the Contingent Convertible Preferred Security of a series are to be redeemed
in part, to issue, register the transfer of or exchange any Contingent Convertible Preferred Security of such series during a period beginning at the opening of business 15 days before the day of the giving of a notice of redemption of Contingent
Convertible Preferred Securities of such series selected for redemption and ending at the close of business on the day of the giving of such notice, or (ii) to register the transfer of or exchange any Contingent Convertible Preferred Security
so selected for redemption in whole or in part, or any Contingent Convertible Preferred Security surrendered for redemption, except, where applicable, the unredeemed portion of any Contingent Convertible Preferred Securities being redeemed in part.

 Section 3.06. Mutilated, Destroyed, Lost and Stolen Contingent Convertible Preferred Securities. If any mutilated Contingent
Convertible Preferred Security (including any Global Security) is surrendered to the Trustee, the Company may execute and the Trustee shall, in the case of a Contingent Convertible Preferred Security, authenticate and deliver, in exchange therefor a
new Contingent Convertible Preferred Security of the same series containing identical terms and provisions and of like amount, and bearing a number not contemporaneously outstanding. 

If there shall be delivered to the Company and to the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any
Contingent Convertible Preferred Security (including any Global Security), and (ii) such security or indemnity as may be required by them to save each of them and any agent of any of them harmless, then, in the absence of notice to the Company
or the Trustee that such Contingent Convertible Preferred Security has been acquired by a protected purchaser, the Company shall execute and upon the Company’s request the Trustee shall authenticate and deliver, in exchange for or in lieu of,
as the case may be, any such mutilated, destroyed, lost or stolen Contingent Convertible Preferred Security, a new Contingent Convertible Preferred Security of the same series containing identical terms and provisions and of like amount, and bearing
a number not contemporaneously outstanding. 
 In case any such mutilated, destroyed, lost or stolen Contingent Convertible Preferred
Security has become or is about to become due and payable, the Company in its discretion may, instead of issuing a new Contingent Convertible Preferred Security, pay such Contingent Convertible Preferred Security. 

  
 29 

 Upon the issuance of any new Contingent Convertible Preferred Security under this Section, the
Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith. 

Every new Contingent Convertible Preferred Security of any series issued pursuant to this Section in lieu of any mutilated, destroyed, lost or
stolen Contingent Convertible Preferred Security shall constitute an original additional contractual obligation of the Company, whether or not the mutilated, destroyed, lost or stolen Contingent Convertible Preferred Security shall be at any time
enforceable by anyone, and shall be entitled to all the benefits of this Contingent Convertible Preferred Securities Indenture equally and proportionately with any and all other Contingent Convertible Preferred Securities of that series duly issued
hereunder. 
 The provisions of this Section are exclusive and shall preclude (to the extent lawful) all other rights and remedies with
respect to the replacement or payment of mutilated, destroyed, lost or stolen Contingent Convertible Preferred Securities. 

Section 3.07. Distributions. Rights Preserved. 

Except as otherwise provided in a supplemental indenture: 

(a) The Company will make any payments of Distributions on any particular series of Contingent Convertible Preferred Securities on the dates
that are determined pursuant to Section 3.01. 
 (b) The Contingent Convertible Preferred Securities of any series will accrue non-cumulative cash Distributions as may be specified in, or determined in accordance with Section 3.01. 

(c) The Company has no obligation to make Distributions with respect to any series of Contingent Convertible Preferred Securities. 

(d) Except as otherwise provided as contemplated by Section 3.01 with respect to any series of Contingent Convertible Preferred
Securities, Distributions, if any, on any Contingent Convertible Preferred Securities which are payable, and are paid or duly provided for, on any Distribution Payment Date shall be paid to the Person in whose name such Contingent Convertible
Preferred Security (or one or more Predecessor Securities) is registered at the close of business on the Regular Record Date for such Distributions. 

(e) In the case of Contingent Convertible Preferred Securities where payment is to be made in U.S. dollars, payment at the Principal Paying
Agent’s office outside The City of New York will be made in U.S. dollars by check drawn on or, at the request of the Holder, by transfer to a U.S. dollar account maintained by the payee with a bank in The City of New York. 

(f) In the case of Contingent Convertible Preferred Securities where payment is to be made in a Foreign Currency, payment will be made as
established pursuant to Section 3.01. 
 (g) Subject to the foregoing provisions of this Section 3.07, each Contingent Convertible
Preferred Security delivered under this Contingent Convertible Preferred Securities Indenture upon registration of transfer of or in exchange for or in lieu of any other Contingent Convertible Preferred Security shall carry the rights to accrued and
unpaid Distributions (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09), if any, and to accrue Distributions, which were carried by such other
Contingent Convertible Preferred Security. 
 Section 3.08. Distributions Discretionary. 

(a) The Company may elect, in its sole and absolute discretion, to cancel the payment of any Distribution on any particular series of
Contingent Convertible Preferred Securities in whole or in part at any time and for any reason. 

  
 30 

 (b) Distributions on the Contingent Convertible Preferred Securities will be non-cumulative. Accordingly, if any Distribution (or any part thereof) is not paid in respect of the Contingent Convertible Preferred Securities of any series as a result of any election of the Company to cancel
such Distribution pursuant to this Section 3.08 or the limitations on payment set out in Section 3.09 then the right of the Holders to receive the relevant Distribution (or such part thereof) in respect of the relevant Distribution Period
will be extinguished and the Company will have no obligation to pay such Distribution (or such part thereof) accrued for such Distribution Period or to pay any interest thereon, whether or not Distributions on the Contingent Convertible Preferred
Securities of such series are paid in respect of any future Distribution Period. 
 (c) No such election to cancel the payment of any
Distribution (or any part thereof) pursuant to this Section 3.08 or non-payment of any Distribution (or any part thereof) as a result of the limitations on payment set out in Section 3.09 will
constitute an event of default, an Enforcement Event or the occurrence of any event related to the insolvency of the Company or entitle Holders to take any action to cause such Distribution (or part thereof) to be paid or the liquidation,
dissolution or winding-up of the Company or in any way limit or restrict the Company from making any distribution or equivalent payment in connection with any instrument ranking junior to the Contingent
Convertible Preferred Securities of such series (including, without limitation, any CET1 Capital of the Company or the Group) or in respect of any Parity Security or other Security, except to the extent Applicable Banking Regulations otherwise
provide. 
 Section 3.09. Restrictions on Payments. 

(a) Payments of Distributions on the Contingent Convertible Preferred Securities of a series shall be made only out of Distributable Items of
the Company. 
 (b) To the extent that (i) the Company has insufficient Distributable Items to make Distributions on the Contingent
Convertible Preferred Securities of such series scheduled for payment in the then current financial year and any interest payments or distributions that have been paid or made or are scheduled or required to be paid or made out of
Distributable Items of the Company in the then current financial year, in each case excluding any portion of such payments already accounted for in determining the Distributable Items of the Company, and/or (ii) the Regulator, in accordance
with Article 68 of Law 10/2014 and/or Article 16 of the SSM Regulation and/or with Applicable Banking Regulations then in force, requires the Company to cancel the relevant Distribution in whole or in part, then the Company will, without prejudice
to the right set forth in Section 3.08 to cancel at its discretion the payment of any such Distributions on the Contingent Convertible Preferred Securities of such series at any time, make partial or, as the case may be, no payment of the
relevant Distribution on the Contingent Convertible Preferred Securities of such series. 
 (c) No payments will be made on the Contingent
Convertible Preferred Securities of any series (whether by way of a repayment of the Liquidation Preference, the payment of any Distribution or otherwise) if and to the extent that such payment would cause a breach of any regulatory restriction or
prohibition on payments on Additional Tier 1 Instruments pursuant to Applicable Banking Regulations (including, without limitation, any such restriction or prohibition relating to any Maximum Distributable Amount applicable to the Company and/or the
Group). 
 Section 3.10. Agreement to Distribution Cancellation. 

(a) By acquiring Contingent Convertible Preferred Securities of any series, Holders (which, for the purposes of this Section 3.10,
includes holders of a beneficial interest in the Contingent Convertible Preferred Securities) acknowledge and agree that: 

(i) Distributions are payable solely at the Company’s discretion, and no amount of Distribution shall become or remain due
and payable in respect of the relevant Distribution Period to the extent that it has been cancelled or deemed cancelled by the Company pursuant to Section 3.08 hereof and/or as a result of the limitations on payment set forth in
Section 3.09; and 

  
 31 

 (ii) a cancellation or deemed cancellation of any Distribution (in whole or in
part) in accordance with the terms of this Contingent Convertible Preferred Securities Indenture and the Contingent Convertible Preferred Securities shall not constitute an Enforcement Event or other default under the terms of the Contingent
Convertible Preferred Securities or this Contingent Convertible Preferred Securities Indenture or the occurrence of any event related to the insolvency of the Company or entitle Holders to take any action to cause such Distribution to be paid or the
liquidation, dissolution or winding-up of the Company or in any way limit or restrict the Company from making any distribution or equivalent payment in connection with any instrument ranking junior to the
Contingent Convertible Preferred Securities of such series (including, without limitation, any CET1 Capital of the Company or the Group) or in respect of any Parity Security or other Security, except to the extent Applicable Banking Regulations
otherwise provide. 
 (b) Distributions will only be due and payable on a Distribution Payment Date to the extent they are not cancelled or
deemed cancelled previously or thereafter in accordance with Section 3.08, Section 3.09, Section 3.10, Section 6.02 and Article 4. Any Distributions cancelled or deemed cancelled (in each case, in whole or in part) in the
circumstances described herein shall not be due and shall not accumulate or be payable at any time thereafter, and Holders of the Contingent Convertible Preferred Securities shall have no rights thereto or to receive any additional Distributions or
compensation as a result of such cancellation or deemed cancellation. 
 Section 3.11. Notice of Distribution Cancellation. If
practicable, the Company will provide notice of any cancellation or deemed cancellation of Distributions on any particular series of Contingent Convertible Preferred Securities (in each case, in whole or in part) to the Holders of the Contingent
Convertible Preferred Securities of such series through the relevant Depositary (or, if the Contingent Convertible Preferred Securities are held in definitive form, to the Holders of the Contingent Convertible Preferred Securities directly at their
addresses shown on the Contingent Convertible Preferred Security Register) and to the Trustee directly on or prior to the relevant Distribution Payment Date. Failure to provide such notice will have no impact on the effectiveness of, or otherwise
invalidate, any such cancellation or deemed cancellation of Distributions (and accordingly, such Distributions will not be due and payable), will not constitute an Enforcement Event with respect to such series of Contingent Convertible Preferred
Securities, or give the Holders or beneficial owners of the Contingent Convertible Preferred Securities of such series any rights as a result of such failure. 

Section 3.12. Persons Deemed Owners. Prior to due presentment of a Contingent Convertible Preferred Security for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee may treat the Person in whose name such Contingent Convertible Preferred Security is registered as the owner of such Contingent Convertible Preferred Security for the
purpose of receiving payment of Liquidation Preference (and premium, if any) of, (subject to Section 3.05 and Section 3.07) any Distribution on and Additional Amounts, if any, on such Contingent Convertible Preferred Security and for all
other purposes whatsoever, whether or not such Contingent Convertible Preferred Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary. The aggregate
Liquidation Preference of the Contingent Convertible Preferred Securities of any series shall be reflected on the books and records of the Contingent Convertible Preferred Security Registrar. 

None of the Company, the Trustee, the Paying Agent or the Contingent Convertible Preferred Security Registrar shall have any responsibility or
obligation to any beneficial owner in a Global Security, any Agent Member or any other Person with respect to the accuracy of the records of the Depositary or its nominee or of any Agent Member, with respect to any ownership interest in the
Contingent Convertible Preferred Securities or with respect to the delivery to any Agent Member, beneficial owner or other Person (other than the Depositary) of any notice (including any notice of redemption) or the payment of any amount, under or
with respect to such Contingent Convertible Preferred Securities. All notices and communications to be given to the Holders and all payments to be made to Holders under the Contingent Convertible Preferred Securities and this Contingent Convertible
Preferred Securities Indenture shall be given or made only to or upon the order of the Holders (which shall be the Depositary or its nominee in the case of the Global Security). The rights of beneficial owners in the Global Security shall be
exercised only through the Depositary subject to the applicable procedures. The Company, the Trustee, the Paying Agent and the Contingent Convertible Preferred Security Registrar shall be entitled to rely and shall be fully protected in relying upon
information furnished by the Depositary with respect to its Agent Members and any beneficial owners. The Company, the Trustee, the Paying Agent and the Contingent Convertible Preferred Security Registrar shall be entitled to deal with the
Depositary, and any nominee thereof, that is the Holder of any Global 

  
 32 

 
Security for all purposes of this Contingent Convertible Preferred Securities Indenture relating to such Global Security (including the payment of Liquidation Preference and Distributions and
Additional Amounts, if any, and the giving of instructions or directions by or to the owner or holder of a beneficial ownership interest in such Global Security) as the sole Holder and shall have no obligations to the beneficial owners thereof. None
of the Company, the Trustee, the Paying Agent or the Contingent Convertible Preferred Security Registrar shall have any responsibility or liability for any acts or omissions of the Depositary with respect to such Global Security, for the records of
any such Depositary, including records in respect of beneficial ownership interests in respect of any such Global Security, for any transactions between the Depositary and any Agent Member or between or among the Depositary, any such Agent Member
and/or any holder or owner of a beneficial interest in such Global Security, or for any transfers of beneficial interests in any such Global Security. 

Notwithstanding the foregoing, with respect to any Global Security, nothing herein shall prevent the Company, the Trustee, or any agent of the
Company or the Trustee from giving effect to any written certification, proxy or other authorization furnished by any Depositary (or its nominee), as a Holder, with respect to such Global Security or shall impair, as between such Depositary and
owners of beneficial interests in such Global Security, the operation of customary practices governing the exercise of the rights of such Depositary (or its nominee) as Holder of such Global Security. 

Each Holder and beneficial owner that acquires its Contingent Convertible Preferred Security in the secondary market shall be deemed to
acknowledge and agree to be bound by and consent to the same provisions specified in this Contingent Convertible Preferred Securities Indenture and the Contingent Convertible Preferred Securities to the same extent as the Holders and beneficial
owners of the Contingent Convertible Preferred Securities that acquire the Contingent Convertible Preferred Securities upon their initial issuance, including, without limitation, with respect to the acknowledgment and agreement to be bound by and
consent to the terms of the Contingent Convertible Preferred Securities, including, without limitation, in relation to Distribution cancellation, the Conversion, the Spanish Bail-in Power and the limitations
on remedies specified in the Contingent Convertible Preferred Security and Section 6.03. 
 Section 3.13. Cancellation. All
Contingent Convertible Preferred Securities surrendered for payment, redemption, registration of transfer, exchange or Conversion shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee, and any such Contingent
Convertible Preferred Securities, as well as Contingent Convertible Preferred Securities surrendered directly to the Trustee for any such purpose, shall be promptly cancelled by the Trustee. The Company may at any time deliver to the Trustee for
cancellation any Contingent Convertible Preferred Securities previously authenticated and delivered hereunder, and all Contingent Convertible Preferred Securities so delivered shall be promptly cancelled by the Trustee. No Contingent Convertible
Preferred Securities shall be authenticated in lieu of or in exchange for any Contingent Convertible Preferred Securities cancelled as provided in this Section, except as expressly permitted by the provisions of the Contingent Convertible Preferred
Securities of any series or pursuant to the provisions of this Contingent Convertible Preferred Securities Indenture. The Trustee shall deliver to the Company all cancelled Contingent Convertible Preferred Securities held by the Trustee. 

Section 3.14. Computation of Distributions. Except as otherwise specified pursuant to Section 3.01 for Contingent Convertible
Preferred Securities of any series, Distributions on the Contingent Convertible Preferred Securities of each series shall be computed on the basis of a 360-day year of twelve
30-day months. 
 Section 3.15. Cusip Numbers. The Company in issuing any series of the
Contingent Convertible Preferred Securities may use “CUSIP”, “ISIN” and/or “Common Code” and/or other similar numbers (if then generally in use) or any successor to such numbers with respect to such series, and, if so,
the Trustee shall use “CUSIP”, “ISIN” and/or “Common Code” and/or other similar numbers or successor numbers in notices of redemption as a convenience to Holders; provided that any such notice may state that no
representation is made as to the correctness of such numbers either as printed on the Contingent Convertible Preferred Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers
printed on the Contingent Convertible Preferred Securities, and any such redemption shall not be affected by any defect in or omission of such numbers. The Company will promptly notify the Trustee of any change in the “CUSIP”,
“ISIN” and/or “Common Code” and/or other similar numbers or successor numbers. 

  
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 Section 3.16. Additional Parity Securities and Contingent Convertible Preferred
Securities. (a) The Company may, from time to time, without the consent or sanction of the Holders of the Contingent Convertible Preferred Securities of any series: (i) take any action required to issue additional Parity Securities or
authorize, create and issue one or more series of Parity Securities ranking equally with the Contingent Convertible Preferred Securities of any such series, as to the participation in the profits and/or assets of the Company, without limit as to the
amount; or (ii) take any action required to authorize, create and issue one or more classes or series of shares of the Company or securities mandatorily convertible into Common Shares of the Company ranking junior or senior to the Contingent
Convertible Preferred Securities of any such series, as to the participation in the profits and/or assets of the Company. 
 (b) By
acquiring a Contingent Convertible Preferred Security of any series, Holders and beneficial owners of Contingent Convertible Preferred Securities agree to renounce any rights of seniority or preference that may be conferred upon it (if any) under
applicable Spanish law (to the extent permitted under applicable Spanish law) over any holder of such Parity Securities issued by the Company from time to time. 

(c) The Contingent Convertible Preferred Securities of any series do not grant the Holders of the Contingent Convertible Preferred Securities
of such series pre-emption rights in respect of any possible future issues of Parity Securities or any other securities by the Company or any Subsidiary. 

(d) The Company may, from time to time, without the consent of the Holders of the Contingent Convertible Preferred Securities of any series,
issue additional Contingent Convertible Preferred Securities (“Additional Contingent Convertible Preferred Securities”) of one or more of the series of Contingent Convertible Preferred Securities issued under this Contingent
Convertible Preferred Securities Indenture having the same ranking and same Distribution Rate, redemption terms and other terms as the Contingent Convertible Preferred Securities of such series except for the price to the public, original
Distribution accrual date, issue date and first Distribution Payment Date. Any such Additional Contingent Convertible Preferred Securities, together with the Contingent Convertible Preferred Securities of the relevant series, will constitute a
single series of Contingent Convertible Preferred Securities under this Contingent Convertible Preferred Securities Indenture and shall be included in the definition of “Contingent Convertible Preferred Securities” in this Contingent
Convertible Preferred Securities Indenture where the context so requires. 
 Section 3.17. Correction of Minor Defects in or
Amendment of Contingent Convertible Preferred Securities. If, after issuance of any Contingent Convertible Preferred Security (including any Global Security), (i) the Company or the Trustee shall become aware of any ambiguity, defect or
inconsistency in any term of a Contingent Convertible Preferred Security or Global Security, as the case may be, or, (ii) with respect to any Contingent Convertible Preferred Security (including any Global Security) issued on or after the date
hereof, the Company and the Trustee agree to amend such Contingent Convertible Preferred Security as contemplated by Section 10.01 and subject to Section 10.03, the parties hereto shall provide for the execution, authentication, delivery
and dating of one or more replacement Contingent Convertible Preferred Securities or Global Securities, as the case may be, pursuant to Section 3.03 hereto, provided, however, that changes made in such Contingent Convertible Preferred
Securities or Global Securities are not materially adverse to Holders of such Contingent Convertible Preferred Securities. 

Section 3.18. Payments Subject to Fiscal Laws. All payments in respect of the Contingent Convertible Preferred Securities will be
subject in all cases to any fiscal or other laws and regulations applicable thereto (including FATCA, any regulations or agreements thereunder, any official interpretation thereof, any intergovernmental agreements with respect thereto, or any law
implementing an intergovernmental agreement or any regulations or official interpretations relating thereto), but without prejudice to the Company’s obligation to pay Additional Amounts to the extent required under Section 11.04. 

  
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 Section 3.19. Undertakings. So long as any Contingent Convertible Preferred Security
of a series remains Outstanding, the Company shall, unless approved by a majority in aggregate Liquidation Preference of such series: 
 (a)
not make any issue, grant or distribution or take or omit to take any other action if the effect thereof would be that, on Conversion, Common Shares could not, under any applicable law then in effect, be legally issued as fully paid; 

(b) if any offer is made to all (or as nearly as may be practicable all) Shareholders (or all (or as nearly as may be practicable all) such
Shareholders other than the offeror and/or any associates of the offeror) to acquire all or a majority of the issued Common Shares, or if a scheme is proposed with regard to such acquisition (other than a Newco Scheme), give notice of such offer or
scheme to the Holders at the same time as any notice thereof is sent to the Shareholders (or as soon as practicable thereafter) that details concerning such offer or scheme may be obtained from the specified offices of the Paying and Conversion
Agent and, where such an offer or scheme has been recommended by the Board of Directors, or where such an offer has become or been declared unconditional in all respects or such scheme has become effective, use all commercially reasonable endeavors
to procure that a like offer or scheme is extended to the holders of any Common Shares issued during the period of the offer or scheme arising out of any Conversion and/or to Holders; 

(c) in the event of a Newco Scheme, take (or shall procure that there is taken) all necessary action to ensure that such amendments are made to
the Contingent Convertible Preferred Securities Indenture immediately after completion of the Scheme of Arrangement as are necessary to ensure that the Contingent Convertible Preferred Securities may be converted into or exchanged for ordinary
shares in Newco (or depositary or other receipts or certificates representing ordinary shares of Newco) mutatis mutandis in accordance with and subject to the Contingent Convertible Preferred Securities Indenture and the ordinary shares of Newco
are: 
 (i) admitted to the Relevant Stock Exchange; or 

(ii) listed and/or admitted to trading on another Recognized Stock Exchange, 

and the Holders of the Contingent Convertible Preferred Securities of the relevant series (which, for this purpose, includes holders of a beneficial interest
in the Contingent Convertible Preferred Securities of such series) irrevocably authorize the Company to make such amendments to the Contingent Convertible Preferred Securities Indenture without the need for any further authorization from the Holders
of the Contingent Convertible Preferred Securities of such series; 
 (d) issue, allot and deliver Common Shares upon Conversion subject to
and as provided in Article 4 below; 
 (e) use all reasonable endeavors to ensure that its issued and outstanding Common Shares and any
Common Shares issued upon Conversion will be admitted to listing and trading on the Relevant Stock Exchange or will be listed and/or admitted to trading on another Recognized Stock Exchange; 

(f) at all times keep in force the relevant resolutions needed for issue, free from pre-emptive rights,
sufficient authorized but unissued Common Shares to enable Conversion of the Contingent Convertible Preferred Securities, and all rights of subscription and exchange for Common Shares, to be satisfied in full; and 

(g) where the provisions of Article 4 require or provide for a determination by an Independent Financial Adviser or a role to be performed by a
Conversion Shares Depository or a Paying and Conversion Agent, the Company shall use all reasonable endeavors promptly to appoint such persons for such purposes. 

ARTICLE 4 

CONVERSION OF THE CONTINGENT CONVERTIBLE PREFERRED
SECURITIES 
 Section 4.01. Conversion upon Trigger Event. 

(a) If the Trigger Event occurs at any time on or after the issue date of any series of Contingent Convertible Preferred Securities, then the
Company will: 

  
 35 

 (i) not pay any Distribution on the Contingent Convertible Preferred Securities
of such series, including any accrued and unpaid Distributions, which shall be deemed to be cancelled by the Company in accordance with Section 3.08 and/or Section 3.09; and 

(ii) irrevocably and mandatorily (and without any requirement for the consent or approval of the Holders or beneficial owners
of Contingent Convertible Preferred Securities of such series) convert all the Contingent Convertible Preferred Securities of such series into Common Shares (the “Trigger Conversion”) to be delivered on the relevant Conversion
Settlement Date. If the Trigger Event occurs, the Contingent Convertible Preferred Securities of any series will be converted in whole and not in part. 

(b) For the purposes of determining whether the Trigger Event has occurred, the Company will (i) calculate the CET1 ratio based on
information (whether or not published) available to management of the Company, including information internally reported within the Company pursuant to its procedures for ensuring effective ongoing monitoring of the capital ratios of the Company and
the Group and (ii) calculate and publish the CET1 ratio on at least a quarterly basis. The Company’s calculation shall be binding on the Trustee and the Holders and beneficial owners of the relevant series of Contingent Convertible
Preferred Securities. 
 (c) A Trigger Event will not constitute an event of default, an Enforcement Event or the occurrence of any event
related to the insolvency of the Company or entitle Holders to take any action to cause the liquidation, dissolution or winding-up of the Company. 

Section 4.02. Conversion upon Capital Reduction. 

(a) Subject as provided in Section 12.04(g), if a Capital Reduction occurs at any time on or after the issue date of any series of
Contingent Convertible Preferred Securities, then the Company will, subject as provided in Section 4.02(b), irrevocably and mandatorily (and without any requirement for the consent or approval of the Holders or beneficial owners of Contingent
Convertible Preferred Securities of such series) convert all the Contingent Convertible Preferred Securities of such series into Common Shares (a “Capital Reduction Conversion”) to be delivered on the relevant Conversion Settlement
Date and on such Conversion Settlement Date pay to the Holders, as applicable, where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09, an amount
equal to the accrued and unpaid Distributions for the then current Distribution Period up to (but excluding) such Conversion Settlement Date.  

(b) Notwithstanding Section 4.02(a), if a Capital Reduction occurs at any time on or after the issue date of any series of Contingent
Convertible Preferred Securities, each Holder of the Contingent Convertible Preferred Securities of such series will have the right to elect that all (but not part) of its Contingent Convertible
Preferred Securities shall not be converted in accordance with Section 4.02(a), in which case all Contingent Convertible Preferred Securities of such Holder shall remain outstanding and no payment of any accrued and unpaid Distributions on such
Contingent Convertible Preferred Securities shall be made in respect of such Contingent Convertible Preferred Securities to that Holder on the relevant Conversion Settlement Date pursuant to Section 4.02(a) (without prejudice to any payment of
such Distributions or any other Distributions that may accrue in respect of those Contingent Convertible Preferred Securities pursuant to Section 3.01). To exercise such right, a Holder must complete, sign and deposit at the specified office of
any Paying and Conversion Agent a duly completed and signed notice of election (an “Election Notice”), in the form then obtainable from the specified office of such Paying and Conversion Agent on or before the tenth Business Day
immediately following the Capital Reduction Notice Date (the period from (and including) the Capital Reduction Notice Date to (and including) such tenth Business Day, the “Election Period”). In the case of any Contingent Convertible
Preferred Securities represented by a Global Security held by or on behalf of a Clearing System, an Election Notice may be delivered within the Election Period by the Holder giving notice to the Principal Paying Agent of such election in accordance
with the standard procedures of the relevant Clearing System (which may include notice being given on such Holder’s instruction by the relevant Clearing System to the Principal Paying Agent by electronic means) in a form acceptable to such
Clearing System from time to time. 
 An Election Notice shall be irrevocable. Each Paying and Conversion Agent shall inform the Principal
Paying Agent within two Business Days of the end of such Election Period of the Election Notices received during the Election Period and the Principal Paying Agent shall notify the Company of the details of the relevant Holders that have duly
submitted an Election Notice within the Election Period (including the aggregate Liquidation Preference of Contingent Convertible Preferred Securities held by such Holders) by no later than the immediately following Business Day. 

  
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 Any relevant Contingent Convertible Preferred Securities in respect of which a duly completed and
signed Election Notice is not received during the Election Period in accordance with this Section 4.02 shall be converted into Common Shares. 

Any Contingent Convertible Preferred Securities not converted upon a Capital Reduction as a result of Holders delivering a duly completed and
signed Election Notice during the Election Period in accordance with Section 4.02 shall remain Outstanding and, notwithstanding any of the above, may be the subject of Conversion on the occurrence of a Trigger Event pursuant to
Section 4.01. 
 (c) A Capital Reduction will not constitute an event of default, an Enforcement Event or the occurrence of any event
related to the insolvency of the Company or entitle Holders to take any action to cause the liquidation, dissolution or winding-up of the Company. 

Section 4.03. Upon conversion. 

(a) Subject as provided in this Section 4.03(a) with respect to fractions, the number of Common Shares to be issued on Conversion in
respect of each Contingent Convertible Preferred Security of any series to be converted shall be determined by dividing the Liquidation Preference of such Contingent Convertible Preferred Security by the relevant Conversion Price in effect on the
relevant Conversion Notice Date rounded down to the nearest whole number of Common Shares. Fractions of Common Shares will not be issued on Conversion or pursuant to Section 4.05(d) and no cash payment or other adjustment will be made in
lieu thereof. Without prejudice to the generality of the foregoing, if one or more Delivery Notices and the related Contingent Convertible Preferred Securities are received by or on behalf of a Paying and Conversion Agent such that the Common Shares
to be delivered by or on behalf of the Conversion Shares Depository are to be registered in the same name or delivered to the same Clearing System participant account, the number of such Common Shares to be delivered in respect thereof shall be
calculated on the basis of the aggregate Liquidation Preference of such Contingent Convertible Preferred Securities being so converted and rounded down to the nearest whole number of Common Shares. 

(b) Upon any Trigger Conversion of any series of Contingent Convertible Preferred Securities, Holders (and beneficial owners) of any Contingent
Convertible Preferred Securities shall have no claim against the Company in respect of (i) any Liquidation Preference (and premium, if any) of such series of Contingent Convertible Preferred Securities converted into Common Shares or
(ii) any accrued and unpaid Distributions cancelled or otherwise unpaid in respect of Contingent Convertible Preferred Securities of such series, and the Contingent Convertible Preferred Securities of such series shall cease to represent any
right other than the right to receive Common Shares from or on behalf of the Conversion Shares Depository. 
 (c) Upon any Capital Reduction
Conversion of any series of Contingent Convertible Preferred Securities, Holders (and beneficial owners) of any Contingent Convertible Preferred Securities, other than Holders of Contingent Convertible Preferred Securities in respect of which such
Holders have elected not to convert such Contingent Convertible Preferred Securities in accordance with Section 4.02(b), shall have no claim against the Company in respect of any Liquidation Preference (and premium, if any) of such series of
Contingent Convertible Preferred Securities, and the Contingent Convertible Preferred Securities of such series converted into Common Shares, other than Contingent Convertible Preferred Securities in respect of which Holders have elected not to
convert such Contingent Convertible Preferred Securities in accordance with Section 4.02(b), shall cease to represent any right other than the right to receive Common Shares from or on behalf of the Conversion Shares Depository. Nothing in this
Section 4.03(c) shall affect the Company’s obligation upon any Capital Reduction Conversion to pay to the Holders, as applicable, where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set
out in Section 3.08 and Section 3.09, and except as provided in Section 4.02(b), an amount equal to the accrued and unpaid Distributions for the then current Distribution Period up to (but excluding) the Conversion Settlement Date.

  
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 (d) On or prior to the Conversion Settlement Date, the Company shall deliver to the Conversion
Shares Depository such number of Common Shares (subject as provided in Section 4.03(a) with respect to fractions) as is required to satisfy in full the Company’s obligation to deliver Common Shares (i) in respect of a Trigger
Conversion, of the aggregate Liquidation Preference of Contingent Convertible Preferred Securities of such series outstanding on the Trigger Event Notice Date, and (ii) in respect of a Capital Reduction Conversion, of the aggregate Liquidation
Preference of Contingent Convertible Preferred Securities of such series Outstanding on the Capital Reduction Notice Date, other than Contingent Convertible Preferred Securities in respect of which such Holders have elected not to convert such
Contingent Convertible Preferred Securities in accordance with Section 4.02(b). 
 (e) The obligation of the Company to issue and
deliver Common Shares to a Holder of Contingent Convertible Preferred Securities of any series on the relevant Conversion Settlement Date shall be satisfied by the delivery of such Common Shares to the Conversion Shares Depository. Receipt of the
relevant Common Shares by the Conversion Shares Depository shall discharge the Company’s obligations in respect of the Contingent Convertible Preferred Securities converted, other than, in the case of a Capital Reduction, as provided under
Section 4.02(a) with respect to the payment of accrued and unpaid Distributions for the then current Distribution Period up to (but excluding) the Conversion Settlement Date (where not cancelled or deemed cancelled pursuant to, or otherwise
subject to the limitations on payment set out in Section 3.08 and Section 3.09) except as provided in Section 4.02(b). 
 (f)
Except as set forth in the immediately succeeding paragraph with respect to a Capital Reduction, if a Conversion Event occurs, Holders shall have recourse to the Company only for the issue and delivery of the relevant Common Shares to the Conversion
Shares Depository. After such delivery by the Company of the relevant Common Shares to the Conversion Shares Depository, Holders of any series of Contingent Convertible Preferred Securities so converted shall have recourse to the Conversion Shares
Depository only for the delivery to them of such Common Shares, in the circumstances described in Section 4.08. 
 In the case of a
Capital Reduction, Holders shall also have recourse to the Company as provided under Section 4.02(a) with respect to the payment of accrued and unpaid Distributions for the then current Distribution Period up to (but excluding) the Conversion
Settlement Date (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) except as provided in Section 4.02(b). 

Section 4.04. Conversion Price. 

“Conversion Price” means, in respect of a Conversion Notice Date, if the Common Shares are: 

(a) then admitted to trading on a Relevant Stock Exchange, the higher of: 

(i) the Reference Market Price of a Common Share (translated into U.S. dollars at the Prevailing Rate, if applicable); 

(ii) the Floor Price (translated into U.S. dollars at the Prevailing Rate, if applicable); and 

(iii) the nominal value of a Common Share (translated into U.S. dollars at the Prevailing Rate, if applicable); or 

(b) not then admitted to trading on a Relevant Stock Exchange, the higher of (ii) and (iii) above. 

Section 4.05. Anti-Dilution Adjustment of the Floor Price. For the purposes of this Section 4.05 only (a) references to
the “issue” of Common Shares or Common Shares being issued shall, if not otherwise expressly specified in this Contingent Convertible Preferred Securities Indenture, include the transfer and/or delivery of Common Shares, whether
newly issued and allotted or previously existing or held by or on behalf of the Company or any member of the Group, and (b) Common Shares held by or on behalf of the Company or any member of the Group (and which, in the case of
Section 4.05(a)(iv) and Section 4.05(a)(vi), are not entitled to receive the relevant right or other entitlement) shall not be considered as or treated as in issue or issued or entitled to receive any Dividend, right or other entitlement.

  
 38 

 References to any issue or offer or grant to Shareholders or Existing Shareholders “as a
class” or “by way of rights” shall be taken to be references to an issue or offer or grant to all or substantially all Shareholders or Existing Shareholders, as the case may be, other than Shareholders or Existing
Shareholders, as the case may be, to whom, by reason of the laws of any territory or requirements of any recognized regulatory body or any other stock exchange or securities market in any territory or in connection with fractional entitlements, it
is determined not to make such issue or offer or grant. 
 (a) Upon the happening of any of the events described below and unless otherwise
provided in connection with a series of Contingent Convertible Preferred Securities, the Floor Price of any series of Contingent Convertible Preferred Securities shall be adjusted from time to time as follows: 

(i) If and whenever there shall be a consolidation, reclassification, redesignation or subdivision affecting the number of
Common Shares, the Floor Price shall be adjusted by multiplying the Floor Price in force immediately prior to such consolidation, reclassification, redesignation or subdivision by the following fraction: 

A 
 B 

where: 
  

	 	A	is the aggregate number of Common Shares in issue immediately before such consolidation, reclassification, redesignation or subdivision, as the case may be; and 

 

	 	B	is the aggregate number of Common Shares in issue immediately after, and as a result of, such consolidation, reclassification, redesignation or subdivision, as the case may be. 

Such adjustment shall become effective on the date the consolidation, reclassification, redesignation or subdivision, as the
case may be, takes effect. 
 (ii) If and whenever the Company shall issue any Common Shares credited as fully paid to
Shareholders by way of capitalization of profits or reserves (including any share premium account or capital redemption reserve) other than (i) where any such Common Shares are or are to be issued instead of the whole or part of a Dividend in
cash which Shareholders would or could otherwise have elected to receive, (ii) where Shareholders may elect to receive a Dividend in cash in lieu of such Common Shares or (iii) where any such Common Shares are or are expressed to be issued
in lieu of a Dividend (whether or not a cash Dividend equivalent or amount is announced or would otherwise be payable to Shareholders, whether at their election or otherwise), the Floor Price shall be adjusted by multiplying the Floor Price in force
immediately prior to such issue by the following fraction: 
 A 

B 
 where: 

 

	 	A	is the aggregate number of Common Shares in issue immediately before such issue; and 

  

	 	B	is the aggregate number of Common Shares in issue immediately after such issue. 

Such adjustment shall become effective on the date of issue of such Common Shares. 

  
 39 

 (iii) (A) If and whenever the Company shall pay any Extraordinary Dividend
to its Shareholders, the Floor Price shall be adjusted by multiplying the Floor Price in force immediately prior to the Effective Date by the following fraction: 

A – B 

    A 
 where:

  

	 	A	is the Current Market Price of one Common Share on the Effective Date; and 

  

	 	B	is the portion of the Fair Market Value of the aggregate Extraordinary Dividend attributable to one Common Share, with such portion being determined by dividing the Fair Market Value of the aggregate Extraordinary
Dividend by the number of Common Shares entitled to receive the relevant Dividend. 

 Such adjustment shall
become effective on the Effective Date or, if later, the first date upon which the Fair Market Value of the relevant Extraordinary Dividend can be determined. 

“Effective Date” means, in respect of this Section 4.05(a)(iii)(A), the first date on which the Common
Shares are traded ex-the relevant Cash Dividend on the Relevant Stock Exchange. 

“Extraordinary Dividend” means any Cash Dividend which is expressly declared by the Company to be a capital
distribution, extraordinary dividend, extraordinary distribution, special dividend, special distribution or return of value to its Shareholders or any analogous or similar term (including any distribution made as a result of any Capital Reduction),
in which case the Extraordinary Dividend shall be such Cash Dividend. 
 (B) If and whenever the Company shall pay or make
any Non-Cash Dividend to Shareholders, the Floor Price shall be adjusted by multiplying the Floor Price in force immediately prior to the Effective Date by the following fraction: 

A – B 

    A 
 where:

  

	 	A	is the Current Market Price of one Common Share on the Effective Date; and 

  

	 	B	is the portion of the Fair Market Value of the aggregate Non-Cash Dividend attributable to one Common Share, with such portion being determined by dividing the Fair Market Value
of the aggregate Non-Cash Dividend by the number of Common Shares entitled to receive the relevant Non-Cash Dividend (or, in the case of a purchase, redemption or buy
back of Common Shares or any depositary or other receipts or certificates representing Common Shares by or on behalf of the Company or any member of the Group, by the number of Common Shares in issue immediately following such purchase, redemption
or buy back, and treating as not being in issue any Common Shares, or any Common Shares represented by depositary or other receipts or certificates, purchased, redeemed or bought back). 

Such adjustment shall become effective on the Effective Date or, if later, the first date upon which the Fair Market Value of
the relevant Non-Cash Dividend is capable of being determined as provided herein. 

  
 40 

 “Effective Date” means, in respect of this
Section 4.05(a)(iii)(B), the first date on which the Common Shares are traded ex-the relevant Dividend on the Relevant Stock Exchange or, in the case of a purchase, redemption or buy back of Common Shares
or any depositary or other receipts or certificates representing Common Shares by or on behalf of the Company or any member of the Group, the date on which such purchase, redemption or buy back is made (or, in any such case if later, the first date
upon which the Fair Market Value of the relevant Dividend is capable of being determined as provided herein) or in the case of a Spin-Off, the first date on which the Common Shares are traded ex-the relevant Spin-Off on the Relevant Stock Exchange. 

(C) For the purposes of this Section 4.05(a)(iii), Fair Market Value shall (subject as provided in paragraph (a) of
the definition of “Dividend” and in the definition of “Fair Market Value”) be determined as at the Effective Date. 

(D) In making any calculations for the purposes of this Section 4.05(a)(iii), such adjustments (if any) shall be made as
an Independent Financial Adviser may determine in good faith to be appropriate to reflect (A) any consolidation or sub-division of any Common Shares or (B) the issue of Common Shares by way of
capitalization of profits or reserves (or any like or similar event) or (C) any increase in the number of Common Shares in issue in the Company’s financial year in question. 

(iv) If and whenever the Company shall issue Common Shares to its Shareholders as a class by way of rights, or the Company or
any member of the Group or (at the direction or request or pursuant to any arrangements with the Company or any member of the Group) any other company, person or entity shall issue or grant to the Shareholders as a class by way of rights, any
options, warrants or other rights to subscribe for or purchase or otherwise acquire any Common Shares, or any Securities which by their terms of issue carry (directly or indirectly) rights of conversion into, or exchange or subscription for, or the
right to acquire, any Common Shares (or shall grant any such rights in respect of existing Securities so issued), in each case at a price per Common Share which is less than 95% of the Current Market Price per Common Share on the Effective Date, the
Floor Price shall be adjusted by multiplying the Floor Price in force immediately prior to the Effective Date by the following fraction: 

A + B 
 A + C 

where: 
  

	 	A	is the number of Common Shares in issue on the Effective Date; 

  

	 	B	is the number of Common Shares which the aggregate consideration (if any) receivable for the Common Shares issued by way of rights, or for the Securities issued by way of rights, or for the options or warrants or other
rights issued or granted by way of rights and for the total number of Common Shares deliverable on the exercise thereof, would purchase at such Current Market Price per Common Share; and 

 

	 	C	is the number of Common Shares to be issued or, as the case may be, the maximum number of Common Shares which may be issued upon exercise of such options, warrants or rights calculated as at the date of issue of such
options, warrants or rights or upon conversion or exchange or exercise of rights of subscription or purchase or other rights of acquisition in respect thereof at the initial conversion, exchange, subscription, purchase or acquisition price or rate,

 provided that if at the Effective Date such number of Common Shares is to be determined by reference
to the application of a formula or other variable feature or the occurrence of any event at some subsequent time, then for the purposes of this Section 4.05(a)(iv), “C” shall be determined by the application of such formula or
variable feature or as if the relevant event occurs or had occurred as at the Effective Date and as if such conversion, exchange, subscription, purchase or acquisition had taken place on the Effective Date. 

Such adjustment shall become effective on the Effective Date. 

  
 41 

 “Effective Date” means, in respect of this
Section 4.05(a)(iv), the first date on which the Common Shares are traded ex-rights, ex-options or ex-warrants on the
Relevant Stock Exchange. 
 (v) If and whenever the Company or any member of the Group or (at the direction or request or
pursuant to any arrangements with the Company or any member of the Group) any other company, person or entity shall issue any Securities (other than Common Shares or options, warrants or other rights to subscribe for or purchase or otherwise acquire
any Common Shares or Securities which by their terms carry (directly or indirectly) rights of conversion into, or exchange or subscription for, or rights to otherwise acquire, Common Shares) to the Shareholders as a class by way of rights or grant
to the Shareholders as a class by way of rights any options, warrants or other rights to subscribe for or purchase or otherwise acquire any Securities (other than Common Shares or options, warrants or other rights to subscribe for or purchase or
otherwise acquire Common Shares or Securities which by their term carry (directly or indirectly) rights of conversion into, or exchange or subscription for, rights to otherwise acquire, Common Shares), the Floor Price shall be adjusted by
multiplying the Floor Price in force immediately prior to the Effective Date by the following fraction: 
 A – B 

    A 

where: 
  

	 	A	is the Current Market Price of one Common Share on the Effective Date; and 

  

	 	B	is the Fair Market Value on the Effective Date of the portion of the rights attributable to one Common Share. 

Such adjustment shall become effective on the Effective Date. 

“Effective Date” means, in respect of this Section 4.05(a)(v), the first date on which the Common Shares
are traded ex-the relevant Securities or ex-rights, ex-option or ex-warrants on the
Relevant Stock Exchange. 
 (vi) If and whenever the Company shall issue (otherwise than as mentioned in
Section 4.05(a)(iv) above) wholly for cash or for no consideration any Common Shares (other than Common Shares issued on conversion of any series of Contingent Convertible Preferred Securities or on the exercise of any rights of conversion
into, or exchange or subscription for or purchase of, or right to otherwise acquire Common Shares) or if and whenever the Company or any member of the Group or (at the direction or request or pursuance to any arrangements with the Company or any
member of the Group) any other company, person or entity shall issue or grant (otherwise than as mentioned in Section 4.05(a)(iv) above) wholly for cash or for no consideration any options, warrants or other rights to subscribe for or purchase
or otherwise acquire any Common Shares (other than the Contingent Convertible Preferred Securities of any series, which term shall for this purpose include any Further Contingent Convertible Preferred Securities), in each case at a price per Common
Share which is less than 95% of the Current Market Price per Common Share on the date of the first public announcement of the terms of such issue or grant, the Floor Price shall be adjusted by multiplying the Floor Price in force immediately prior
to the Effective Date by the following fraction: 
 A + B 

A + C 
 where: 

 

	 	A	is the number of Common Shares in issue immediately before the issue of such Common Shares or the grant of such options, warrants or rights; 

  
 42 

	 	B	is the number of Common Shares which the aggregate consideration (if any) receivable for the issue of such Common Shares or, as the case may be, for the Common Shares to be issued or otherwise made available upon the
exercise of any such options, warrants or rights, would purchase at such Current Market Price per Common Share on the Effective Date; and 

  

	 	C	is the number of Common Shares to be issued pursuant to such issue of such Common Shares or, as the case may be, the maximum number of Common Shares which may be issued upon exercise of such options, warrants or rights
calculated as at the date of issue of such options, warrants or rights, provided that if at the Effective Date, such number of Common Shares is to be determined by reference to the application of a formula or other variable feature or the
occurrence of any event at some subsequent time, then for the purposes of this Section 4.05(a)(vi), “C” shall be determined by the application of such formula or variable feature or as if the relevant event occurs or had occurred as
at the Effective Date and as if such conversion, exchange, subscription, purchase or acquisition had taken place on the Effective Date. 

Such adjustment shall become effective on the Effective Date. 

“Effective Date” means, in respect of this Section 4.05(a)(vi), the date of issue of such Common Shares
or, as the case may be, the grant of such options, warrants or rights. 
 (vii) If and whenever the Company or any member of
the Group or (at the direction or request of or pursuant to any arrangements with the Company or any member of the Group) any other company, person or entity (otherwise than as mentioned in Section 4.05(a)(iv), Section 4.05(a)(v) or
Section 4.05(a)(vi)) shall issue wholly for cash or for no consideration any Securities (other than Contingent Convertible Preferred Securities of any series, which term for this purpose shall include any Further Contingent Convertible
Preferred Securities) which by their terms of issue carry (directly or indirectly) rights of conversion into, or exchange or subscription for, purchase of, or rights to otherwise acquire, Common Shares (or shall grant any such rights in respect of
existing Securities so issued) or Securities which by their terms might be reclassified/redesignated as Common Shares, and the consideration per Common Share receivable upon conversion, exchange, subscription, purchase, acquisition or redesignation
is less than 95% of the Current Market Price per Common Share on the date of the first public announcement of the terms of issue of such Securities (or the terms of such grant), the Floor Price shall be adjusted by multiplying the Floor Price in
force immediately prior to the Effective Date by the following fraction: 
 A + B 

A + C 
 where: 

 

	 	A	is the number of Common Shares in issue immediately before such issue or grant (but where the relevant Securities carry rights of conversion into or rights of exchange or subscription for, purchase of, or rights to
otherwise acquire Common Shares which have been issued, purchased or acquired by the Company or any member of the Group (or at the direction or request or pursuant to any arrangements with the Company or any member of the Group) for the purposes of
or in connection with such issue, less the number of such Common Shares so issued, purchased or acquired); 

  

	 	B	is the number of Common Shares which the aggregate consideration (if any) receivable for the Common Shares to be issued or otherwise made available upon conversion or exchange or upon exercise of the right of
subscription, purchase or acquisition attached to such Securities or, as the case may be, for the Common Shares to be issued or to arise from any such reclassification/redesignation would purchase at such Current Market Price per Common Share; and

  
 43 

	 	C	is the maximum number of Common Shares to be issued or otherwise made available upon conversion or exchange of such Securities or upon the exercise of such right of subscription attached thereto at the initial
conversion, exchange, subscription, purchase or acquisition price or rate or, as the case may be, the maximum number of Common Shares which may be issued or arise from any such reclassification/redesignation; 

provided that if at the Effective Date such number of Common Shares is to be determined by reference to the application
of a formula or other variable feature or the occurrence of any event at some subsequent time (which may be when such Securities are converted or exchanged or rights of subscription, purchase or acquisition are exercised or, as the case may be, such
Securities are reclassified/redesignated or at such other time as may be provided), then for the purposes of this Section 4.05(a)(vii), “C” shall be determined by the application of such formula or variable feature or as if the
relevant event occurs or had occurred as at the Effective Date and as if such conversion, exchange, subscription, purchase or acquisition or, as the case may be, reclassification/redesignation had taken place on the Effective Date. 

Such adjustment shall become effective on the Effective Date. 

“Effective Date” means, in respect of this Section 4.05(a)(vii), the date of issue of such Securities or,
as the case may be, the grant of such rights. 
 (viii) If and whenever there shall be any modification of the rights of
conversion, exchange, subscription, purchase or acquisition attaching to any Securities (other than the Contingent Convertible Preferred Securities of any series, which term shall for this purpose include any Further Contingent Convertible Preferred
Securities) pursuant to Section 4.05(a)(vii) above (other than in accordance with the terms (including terms as to adjustment) applicable to such Securities upon issue) so that following such modification the consideration per Common Share
receivable has been reduced and is less than 95% of the Current Market Price per Common Share on the date of the first public announcement of the proposals for such modification, the Floor Price shall be adjusted by multiplying the Floor Price in
force immediately prior to the Effective Date by the following fraction: 
 A + B 

A + C 
 where: 

 

	 	A	is the number of Common Shares in issue immediately before such modification (but where the relevant Securities carry rights of conversion into or rights of exchange or subscription for, or purchase or acquisition of,
Common Shares which have been issued, purchased or acquired by the Company or any member of the Group (or at the direction or request or pursuant to any arrangements with the Company or any member of the Group) for the purposes of or in connection
with such Securities, less the number of such Common Shares so issued, purchased or acquired); 

  

	 	B	is the number of Common Shares which the aggregate consideration (if any) receivable for the Common Shares to be issued or otherwise made available upon conversion or exchange or upon exercise of the right of
subscription, purchase or acquisition attached to the Securities so modified would purchase at such Current Market Price per Common Share or, if lower, the existing conversion, exchange, subscription, purchase or acquisition price or rate of such
Securities; and 

  

	 	C	is the maximum number of Common Shares which may be issued or otherwise made available upon conversion or exchange of such Securities or upon the exercise of such rights of subscription, purchase or acquisition attached
thereto at the modified conversion, exchange, subscription, purchase or acquisition price or rate but giving credit in such manner as an Independent Financial Adviser in good faith shall consider appropriate for any previous adjustment under this
Section 4.05(a)(viii) or Section 4.05(a)(vii); 

  
 44 

 provided that if at the Effective Date such number of Common Shares is to
be determined by reference to the application of a formula or other variable feature or the occurrence of any event at some subsequent time (which may be when such Securities are converted or exchanged or rights of subscription, purchase or
acquisition are exercised or at such other time as may be provided) then for the purposes of this Section 4.05(a)(viii), “C” shall be determined by the application of such formula or variable feature or as if the relevant event occurs
or had occurred as at the Effective Date and as if such conversion, exchange, subscription, purchase or acquisition had taken place on the Effective Date. 

Such adjustment shall become effective on the Effective Date. 

“Effective Date” means, in respect of this Section 4.05(a)(viii), the date of modification of the rights
of conversion, exchange, subscription, purchase or acquisition attaching to such Securities. 
 (ix) If and whenever the
Company or any member of the Group or (at the direction or request of or pursuant to any arrangements with the Company or any member of the Group) any other company, person or entity shall offer any Securities in connection with which the
Shareholders as a class are entitled to participate in arrangements whereby such Securities may be acquired by them (except where the Floor Price falls to be adjusted under Section 4.05(a)(ii), Section 4.05(a)(iii),
Section 4.05(a)(iv), Section 4.05(a)(v), Section 4.05(a)(vi) or Section 4.05(a)(x) (or would fall to be so adjusted if the relevant issue or grant was at less than 95% of the Current Market Price per Common Share on the relevant
dealing day under Section 4.05(a)(v) above)) the Floor Price shall be adjusted by multiplying the Floor Price in force immediately before the Effective Date by the following fraction: 

A – B 

    A 

where: 
  

	 	A	is the Current Market Price of one Common Share on the Effective Date; and 

  

	 	B	is the Fair Market Value on the Effective Date of the portion of the relevant offer attributable to one Common Share. 

Such adjustment shall become effective on the Effective Date. 

“Effective Date” means, in respect of this Section 4.05(a)(ix), the first date on which the Common Shares
are traded ex-rights on the Relevant Stock Exchange. 
 (x) If the Company determines
that a reduction to the Floor Price should be made for whatever reason, the Floor Price will be reduced (either generally or for a specified period as notified to Holders of the Contingent Convertible Preferred Securities of such relevant series) in
such manner and with effect from such date as the Company shall determine and notify to the Holders of the relevant series of Contingent Convertible Preferred Securities. 

(b) Notwithstanding Section 4.05(a): 

(i) where the events or circumstances giving rise to any adjustment of the Floor Price have already resulted or will result in
an adjustment to the Floor Price or where the events or circumstances giving rise to any adjustment arise by virtue of any other events or circumstances which have already given or will give rise to an adjustment to the Floor Price or where more
than one event which gives rise to an adjustment to the Floor Price occurs within such a short period of time that, in the opinion of the Company, a modification to the operation of the adjustment provisions is required to give the intended result,
such modification shall be made to the operation of the adjustment provisions as may be determined in good faith by an Independent Financial Adviser to be in its opinion appropriate to give the intended result; and 

  
 45 

 (ii) such modification shall be made to the operation of this Section 4.05
as may be determined in good faith by an Independent Financial Adviser to be in its opinion appropriate (A) to ensure that an adjustment to the Floor Price or the economic effect thereof shall not be taken into account more than once and
(B) to ensure that the economic effect of a Dividend is not taken into account more than once; 
 and in each case, any such
modification shall be conclusive and binding on all parties (including the Holders and beneficial owners of any Contingent Convertible Preferred Security) save in the case of manifest error. 

(c) For the purpose of any calculation of the consideration receivable or price pursuant to Section 4.05(a)(iv), Section 4.05(a)(vi),
Section 4.05(a)(vii) and Section 4.05(a)(viii) above, the following provisions shall apply: 
 (i) the aggregate
consideration receivable or price for Common Shares issued for cash shall be the amount of such cash; 
 (ii) (A) the
aggregate consideration receivable or price for Common Shares to be issued or otherwise made available upon the conversion or exchange of any Securities shall be deemed to be the consideration or price received or receivable for any such Securities
and (B) the aggregate consideration receivable or price for Common Shares to be issued or otherwise made available upon the exercise of rights of subscription attached to any Securities or upon the exercise of any options, warrants or rights
shall be deemed to be that part (which may be the whole) of the consideration or price received or receivable for such Securities or, as the case may be, for such options, warrants or rights which are attributed by the Company to such rights of
subscription or, as the case may be, such options, warrants or rights or, if no part of such consideration or price is so attributed, the Fair Market Value of such rights of subscription or, as the case may be, such options, warrants or rights as at
the relevant Effective Date as referred to in Section 4.05(a)(iv), Section 4.05(a)(vi), Section 4.05(a)(vii) or Section 4.05(a)(viii) above, as the case may be, plus in the case of each of (A) and (B) above, the additional
minimum consideration receivable or price (if any) upon the conversion or exchange of such Securities, or upon the exercise of such rights of subscription attached thereto or, as the case may be, upon exercise of such options, warrants or rights and
(C) the consideration receivable or price per Common Share upon the conversion or exchange of, or upon the exercise of such rights of subscription attached to, such Securities or, as the case may be, upon the exercise of such options, warrants
or rights shall be the aggregate consideration or price referred to in (A) or (B) above (as the case may be) divided by the number of Common Shares to be issued upon such conversion or exchange or exercise at the initial conversion, exchange or
subscription price or rate; 
 (iii) if the consideration or price determined pursuant to (i) or (ii) above (or any
component thereof) shall be expressed in a currency other than the Share Currency, it shall be converted into the Share Currency at the Prevailing Rate on the relevant Effective Date (in the case of (i) above) or the relevant date of first
public announcement (in the case of (ii) above); 
 (iv) in determining the consideration or price pursuant to the
above, no deduction shall be made for any commissions or fees (howsoever described) or any expenses paid or incurred for any underwriting, placing or management of the issue of the relevant Common Shares or Securities or options, warrants or rights,
or otherwise in connection therewith; and 
 (v) the consideration or price shall be determined as provided above on the
basis of the consideration or price received, receivable, paid or payable regardless of whether all or part thereof is received, receivable, paid or payable by or to the Company or another entity. 

(d) If the Conversion Settlement Date in relation to the Conversion of any Contingent Convertible Preferred Security of any series shall be
after the record date in respect of any consolidation, reclassification, redesignation or sub-division as is mentioned in Section 4.05(a)(i), or after the record date or other due date for the
establishment of entitlement for any such issue, distribution, grant or offer (as the case may be) as is mentioned in Section 4.05(a)(ii), Section 4.05(a)(iii), Section 4.05(a)(iv), Section 4.05(a)(v) or Section 4.05(a)(ix),
or after the date of the first public announcement of the terms of any such issue or grant as is mentioned in Section 4.05(a)(vi) 

  
 46 

 
and Section 4.05(a)(vii) or of the terms of any such modification as is mentioned in Section 4.05(a)(viii) above, but before the relevant adjustment to the Floor Price (if applicable)
becomes effective under Section 4.05 above (such adjustment, a “Retroactive Adjustment”), then the Company shall (conditional upon the relevant adjustment becoming effective) procure that there shall be delivered to the
Conversion Shares Depository, for onward delivery to the Holders of the relevant Contingent Convertible Preferred Securities, in accordance with the instructions contained in the Delivery Notices received by the Conversion Shares Depository, such
additional number of Common Shares (if any) (the “Additional Common Shares”) as, together with the Common Shares issued on Conversion of the Contingent Convertible Preferred Securities (together with any fraction of a Common Share
not so delivered to any relevant Holder pursuant to Section 4.03(a)), is equal to the number of Common Shares which would have been required to be issued and delivered on such Conversion if the relevant adjustment to the Floor Price had been
made and become effective immediately prior to the relevant Conversion Notice Date (subject as provided in Section 4.03(a) with respect to fractions), provided that, where applicable, if the Conversion Shares Depository and/or the
Holders, as the case may be, shall be entitled to receive the relevant Dividend in respect of the Common Shares to be issued or delivered to them, then no such Retroactive Adjustment shall be made in relation to such Dividend and Additional Common
Shares shall not be issued and delivered to the Conversion Shares Depository and Holders in relation thereto. If Additional Common Shares are required under this Contingent Convertible Preferred Securities Indenture, all references to the issue
and/or delivery of Common Shares in this Contingent Convertible Preferred Securities Indenture shall be construed accordingly. 
 (e) If any
doubt shall arise as to whether an adjustment is required to be made to the Floor Price or as to the appropriate adjustment to the Floor Price, the Company may at its discretion appoint an Independent Financial Adviser and, following consultation
between the Company and such Independent Financial Adviser, a written determination of such Independent Financial Adviser in respect thereof shall be conclusive and binding on all parties (including the Holders and beneficial owners of any
Contingent Convertible Preferred Security), save in the case of manifest error. 
 (f) No adjustment will be made to the Floor Price where
Common Shares or other Securities (including rights, warrants and options) are issued, offered, exercised, allotted, purchased, appropriated, modified or granted to, or for the benefit of, employees or former employees (including directors holding
or formerly holding executive or non-executive office or the personal service company of any such person) or their spouses or relatives, in each case, of the Company or any member of the Group or any
associated company or to a trustee or trustees or intermediary to be held for the benefit of any such person, in any such case pursuant to any share or option or similar scheme. 

(g) On any adjustment, if the resultant Floor Price has more decimal places than the initial Floor Price, it shall be rounded down to the same
number of decimal places as the initial Floor Price. No adjustment shall be made to the Floor Price where such adjustment (rounded down if applicable) would be less than 1% of the Floor Price then in effect. Any adjustment not required to be made
pursuant to the above, and/or any amount by which the Floor Price has been rounded down, shall be carried forward and taken into account in any subsequent adjustment, and such subsequent adjustment shall be made on the basis that the adjustment not
required to be made had been made at the relevant time and/or, as the case may be, that the relevant rounding down had not been made. 
 (h)
Notice of any adjustments to the Floor Price shall be given by the Company to Holders of the Contingent Convertible Preferred Securities of any series through the filing of a relevant information (información relevante)
announcement with the CNMV and its publication in accordance with the rules and regulations of any applicable stock exchange or other relevant authority and in accordance with Section 1.06 promptly after the determination thereof. 

Section 4.06. Conversion Procedures. Common Shares. 

(a) If a Trigger Event occurs at any time on or after the issue date of any series of Contingent Convertible Preferred Securities, then the
Company will notify the Regulator and the Holders of such series of Contingent Convertible Preferred Securities immediately upon the Company’s determination that a Trigger Event has occurred (i) through the filing of a relevant information
(información relevante) announcement with the CNMV and its publication in accordance with the rules and regulations of any applicable stock exchange or other relevant authority and (ii) in accordance with
Section 1.06 (together, the “Trigger Event Notice”). Any failure by the Company to give a Trigger Event Notice or otherwise notify the Holders of a Trigger Event will have no impact on

  
 47 

 
the effectiveness of, or otherwise invalidate, any Trigger Conversion, will not constitute an Enforcement Event with respect to such series of Contingent Convertible Preferred Securities, or give
the Holders or beneficial owners of the Contingent Convertible Preferred Securities of such series any rights as a result of such failure. 

(b) If a Capital Reduction occurs at any time on or after the issue date of any series of Contingent Convertible Preferred Securities, then the
Company will notify the Regulator and the Holders of such series of Contingent Convertible Preferred Securities immediately (i) through the filing of a relevant information (información relevante) announcement with
the CNMV and its publication in accordance with the rules and regulations of any applicable stock exchange or other relevant authority and (ii) in accordance with Section 1.06 (together, the “Capital Reduction Notice”).
Any failure by the Company to give a Capital Reduction Notice or otherwise notify the Holders of a Capital Reduction will have no impact on the effectiveness of, or otherwise invalidate, any Capital Reduction, will not constitute an Enforcement
Event with respect to such series of Contingent Convertible Preferred Securities, or give the Holders or beneficial owners of the Contingent Convertible Preferred Securities of such series any rights as a result of such failure. 

(c) A Conversion Notice shall be a written notice specifying the following: 

(i) that a Trigger Event or a Capital Reduction has occurred, as the case may be; 

(ii) in the case of a Capital Reduction Notice, the Conversion Price; 

(iii) in the case of a Capital Reduction Notice, the Election Period and the procedures Holders must follow with respect to
timely submission of Election Notices; 
 (iv) in the case of a Capital Reduction Notice, the expected Conversion Settlement
Date, which shall be as soon as practicable and in any event not later than one month following (or such other period as Applicable Banking Regulations may require) the Conversion Notice Date; 

(v) the contact details of the Conversion Shares Depository and Paying and Conversion Agent and the procedures Holders of the
Contingent Convertible Preferred Securities must follow to obtain delivery of the Common Shares; 
 (vi) that the Contingent
Convertible Preferred Securities (other than, in the case of a Capital Reduction, Contingent Convertible Preferred Securities which Holders elect not to convert in accordance with Section 4.02(b)) shall remain in existence for the sole purposes
of evidencing the Holder’s right to receive Common Shares from or on behalf of the Conversion Shares Depository and, in the case of a Capital Reduction, of evidencing the Holder’s right to receive payment of accrued and unpaid
Distributions for the then current Distribution Period up to (but excluding) the Conversion Settlement Date as provided under Section 4.02(a), where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on
payment set out in Section 3.08 and Section 3.09; and 
 (vii) a request that Holders and beneficial owners
(or the custodian, broker, nominee or other representative thereof) of such Contingent Convertible Preferred Securities complete a Delivery Notice to be delivered, together with the relevant Contingent Convertible Preferred Securities
held by them (other than, in the case of a Capital Reduction, Contingent Convertible Preferred Securities which Holders elect not to convert in accordance with Section 4.02(b)), to the specified office of the Paying and Conversion Agent, with a
copy of such Delivery Notice to the Trustee, no later than five Business Days (in the relevant place of delivery) prior to the relevant Conversion Settlement Date (the “Notice Cut-off Date”).

 In the case of a Trigger Event, the Company shall further notify the Holders of the relevant series of Contingent Convertible Preferred
Securities of the expected Conversion Settlement Date and of the Conversion Price within ten (10) Business Days of the Conversion Notice Date, in accordance with Section 1.06. 

  
 48 

 (d) The Conversion Notice Date shall be deemed to be the date on which the Trigger Event Notice
or the Capital Reduction Notice, as the case may be, containing the information set forth in Section 4.06(c) (except, in the case of a Trigger Event, for its last paragraph) is communicated through the filing of a relevant information
(información relevante) announcement with the CNMV and is published in accordance with the rules and regulations of any applicable stock exchange or other relevant authority in accordance with Section 4.06(a) or 4.06(b), as the
case may be. 
 (e) Notwithstanding Sections 4.06(a) and 4.06(b), upon the Company’s determination that a Trigger Event has occurred or
upon the Company’s adoption of a Capital Reduction measure, it shall, prior to giving a Conversion Notice, deliver to the Trustee a certificate stating that a Conversion Event has occurred, which the Trustee shall accept without any further
enquiry as sufficient evidence of such matters, and such certificate will be conclusive and binding on the Trustee, the Holders and beneficial owners of the Contingent Convertible Preferred Securities of such series. The Company shall provide a copy
of the Conversion Notice to the Trustee as soon as it is available. 
 (f) Within two (2) Business Days after its receipt of the
Conversion Notice, the Trustee shall transmit the Conversion Notice to the Depositary. 
 (g) If a Trigger Event occurs, the Contingent
Convertible Preferred Securities of any series will be converted in whole and not in part pursuant to this Article 4, and if a Capital Reduction occurs, the Contingent Convertible Preferred Securities of any series will be converted in whole and not
in part pursuant to this Article 4 except for Contingent Convertible Preferred Securities in respect of which such Holders have elected not to convert such Contingent Convertible Preferred Securities in accordance with Section 4.02(b). 

(h) Notwithstanding anything set forth in this Contingent Convertible Preferred Securities Indenture to the contrary, except in the case of a
Capital Reduction with respect to any Contingent Convertible Preferred Securities in respect of which the Holders have elected not to convert such Contingent Convertible Preferred Securities in accordance with Section 4.02(b) (as the case may
be), upon a Conversion, (i) subject to the right of Holders of the Contingent Convertible Preferred Securities relating to a breach of the Performance Obligation in the event of a failure by the Company to issue and deliver any Common Shares to
the Conversion Shares Depository on the Conversion Settlement Date and, in the case of a Capital Reduction, the right of Holders to receive payment of accrued and unpaid Distributions for the then current Distribution Period up to (but excluding)
the Conversion Settlement Date provided under Section 4.02(a) (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09 and except as provided in
Section 4.02(b)), the Contingent Convertible Preferred Securities Indenture shall impose no duties upon the Trustee whatsoever with regard to a Conversion (other than as provided in Section 3.05(a) if a Global Security is surrendered for
conversion in part upon a Capital Reduction), and the Holders of the Contingent Convertible Preferred Securities converted or to be converted shall have no rights whatsoever under the Contingent Convertible Preferred Securities Indenture or such
Contingent Convertible Preferred Securities to instruct the Trustee to take any action whatsoever and (ii) as of the Conversion Notice Date, except for any indemnity and/or security provided by any Holders of such Contingent Convertible
Preferred Securities in such direction or related to such direction, any direction previously given to the Trustee by any Holders of such Contingent Convertible Preferred Securities shall cease automatically and shall be null and void and of no
further effect. 
 (i) The Company’s obligations to indemnify the Trustee in accordance with the Contingent Convertible Preferred
Securities Indenture shall survive any Conversion. 
 Section 4.07. Agreement and Waiver with Respect to Conversion. The
Contingent Convertible Preferred Securities of any series are not convertible into Common Shares at the option of Holders of Contingent Convertible Preferred Securities of any series at any time and are not redeemable in cash as a result of a
Conversion Event. Notwithstanding any other provision herein, by its acquisition of the Contingent Convertible Preferred Securities of any series, each Holder and beneficial owner shall be deemed to have (i) agreed to all the terms and
conditions of the Contingent Convertible Preferred Securities of such series, including, without limitation, those related to (x) Conversion following a Trigger Event or Capital Reduction, as the case may be, and (y) the appointment of the
Conversion Shares Depository, the issuance of the Common Shares to the Conversion Shares Depository (or to the relevant recipient in accordance with the terms of the Contingent Convertible Preferred Securities of such series or the Conversion
Notice), and acknowledged that such events in (x) and (y) may occur without any further action on the part of the Holders or beneficial owners of the Contingent Convertible Preferred 

  
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Securities of such series or the Trustee, (ii) agreed that effective upon, and following, the Conversion, no amount shall be due and payable to the Holders of the Contingent Convertible
Preferred Securities so converted (other than any accrued and unpaid Distributions to be paid upon a Capital Reduction Conversion in accordance with Section 4.02(a) (where not cancelled or deemed cancelled pursuant to, or otherwise subject to
the limitations on payment set out in Section 3.08 and Section 3.09 and except as provided in Section 4.02(b))), and the Company’s liability to pay any such amounts (including the Liquidation Preference (and premium, if any) of,
or any Distribution in respect of (other than any accrued and unpaid Distributions to be paid upon a Capital Reduction Conversion in accordance with Section 4.02(a) (where not cancelled or deemed cancelled pursuant to, or otherwise subject to
the limitations on payment set out in Section 3.08 and Section 3.09 and except as provided in Section 4.02(b))), except as noted under Section 4.08(g) with respect to certain stamp and similar taxes, shall be automatically
released, and the Holders of the Contingent Convertible Preferred Securities so converted shall not have the right to give a direction to the Trustee with respect to the Conversion Event and any related Conversion, (iii) waived, to the extent
permitted by the Trust Indenture Act, any claim against the Trustee arising out of its acceptance of its trusteeship under, and the performance of its duties, powers and rights in respect of, the Contingent Convertible Preferred Securities Indenture
and in connection with the Contingent Convertible Preferred Securities so converted or to be converted, including, without limitation, claims related to or arising out of or in connection with a Conversion Event and/or any Conversion and
(iv) authorized, directed and requested DTC, the European Clearing Systems and any direct participant in DTC, the European Clearing Systems or other intermediary or depositary through which it holds such Contingent Convertible Preferred
Securities to be converted to take any and all necessary action, if required, to implement the Conversion without any further action or direction on the part of such Holder or beneficial owner of such Contingent Convertible Preferred Securities or
the Trustee. 
 Section 4.08. Settlement Procedures. 

(a) Delivery of the Common Shares to the Holders of converted Contingent Convertible Preferred Securities upon a Conversion Event shall be made
in accordance with the procedures set forth in this Section 4.08. The Company may make changes to these procedures to the extent such changes are reasonably necessary, in the opinion of the Company, including to reflect changes in clearing
system practices. 
 (b) Holders of any series of Contingent Convertible Preferred Securities cleared and settled through DTC may elect to
have their Common Shares delivered in the form of Common Shares or ADSs in accordance with the procedures set forth in this Section 4.08. The obligation to deliver ADSs if a Holder elects to have its Common Shares delivered in such form will
apply only if on the relevant Conversion Settlement Date the Company continues to maintain an ADS depositary facility. 
 (c) In order to
obtain delivery of the relevant Common Shares, or, if indicated in the relevant Delivery Notice, ADSs, upon any Conversion from the Conversion Shares Depository, the relevant Holder or beneficial owner (or the custodian, broker, nominee or other
representative thereof) must deliver its Contingent Convertible Preferred Securities (other than, in the case of a Capital Reduction, Contingent Convertible Preferred Securities which Holders elect not to convert in accordance with
Section 4.02(b)) and a duly completed Delivery Notice to the specified office of the Paying and Conversion Agent, with a copy of such Delivery Notice to the Trustee, on or before the Notice Cut-off Date.
The Delivery Notice shall contain: (i) the name of the Holder or beneficial owner (or the custodian, broker, nominee or other representative thereof) of the Contingent Convertible Preferred Securities to be converted; (ii) the aggregate
Liquidation Preference held by such Holder or beneficial owner (or the custodian, broker, nominee or other representative thereof) of such converted Contingent Convertible Preferred Securities on the date of such notice; (iii) the name in which
the Common Shares or ADSs, as applicable, are to be registered, if applicable; (iv) whether Common Shares or ADSs are to be delivered to the Holder or beneficial owner of such Contingent Convertible Preferred Securities; (v) the details of
the DTC, Iberclear or other clearing system account (subject to the limitations set out below) to which the Common Shares or ADSs are to be credited (or, if the Common Shares are not a participating security in Iberclear or another clearing system,
the address to which the Common Shares should be delivered; and, as the case may be, details of the registered account in the Company’s ADS facility if direct registration ADSs are to be issued); (vi) any relevant certifications and/or
representations as may be required by applicable law and regulations; and (vii) such other details as may be required by the Paying and Conversion Agent or any relevant Clearing System. 

  
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 (d) If the Contingent Convertible Preferred Securities are held through DTC, the Delivery Notice
must be given and the Contingent Convertible Preferred Securities delivered in accordance with the applicable procedures of DTC (which may include the notice being given to the Paying and Conversion Agent by electronic means) and in a form
acceptable to DTC and the Paying and Conversion Agent. With respect to any Contingent Convertible Preferred Securities held in definitive form, the Delivery Notice must be delivered to the specified office of the Paying and Conversion Agent together
with the relevant Contingent Convertible Preferred Securities, except as otherwise indicated in the relevant Conversion Notice. 
 (e)
Subject to satisfaction of the requirements and limitations set forth in this Section 4.08 and provided that the relevant Contingent Convertible Preferred Securities and a duly completed Delivery Notice have been delivered not later than
the Notice Cut-off Date, the Paying and Conversion Agent shall give instructions to the Conversion Shares Depository that the Conversion Shares Depository shall deliver the relevant Common Shares (as rounded
down to the nearest whole number of Common Shares in accordance with Section 4.03(a) and, where applicable, Section 4.05(d)) to, or shall deposit part or all of such Common Shares with the ADS Depositary on behalf of, the Holder or
beneficial owner (or the custodian, broker, nominee or other representative thereof) of the relevant Contingent Convertible Preferred Securities completing such Delivery Notice or its nominee in accordance with the instructions given in such
Delivery Notice on the applicable Conversion Settlement Date. 
 (f) Any Delivery Notice shall be irrevocable. Failure properly to complete
and deliver a Delivery Notice and deliver the relevant Contingent Convertible Preferred Securities may result in such Delivery Notice being treated as null and void and the Company shall be entitled to procure the sale of any applicable Common
Shares to which the relevant Holder may be entitled in accordance with Section 4.09. Any determination as to whether any Delivery Notice has been properly completed and delivered as provided in this Section 4.08 shall be made by the
Company in its sole discretion, acting in good faith, and shall, in the absence of manifest error, be conclusive and binding on the relevant Holders and beneficial owners (and any custodian, broker, nominee or other representative thereof). 

(g) A Holder of the Contingent Convertible Preferred Securities of any series or Selling Agent (as defined in Section 4.09) must pay (in
the case of the Selling Agent by means of deduction from the net proceeds of sale set forth in Section 4.09) any taxes and capital, stamp, issue, registration and transfer taxes or duties arising on Conversion (other than any capital, stamp,
issue, registration and transfer taxes or duties payable in Spain by the Company in respect of the issue and delivery of the Common Shares in accordance with a Delivery Notice delivered pursuant to the Contingent Convertible Preferred Securities
Indenture which shall be paid by the Company) and such Holder or the Selling Agent (as the case may be) must pay (in the case of the Selling Agent, by way of deduction from the net proceeds of sale as aforesaid) all, if any, taxes or duties arising
by reference to any disposal or deemed disposal of a Contingent Convertible Preferred Security or interest therein. 
 (h) Any costs incurred
by the Conversion Shares Depository or any parent, subsidiary or affiliate of the Conversion Shares Depository in connection with the holding by the Conversion Shares Depository of any Common Shares and any amount received in respect thereof
shall be deducted by the Conversion Shares Depository from such amount (or, if such deduction is not possible, paid to the Conversion Shares Depository, by the relevant Holder) prior to the delivery of such Common Shares and/or payment of such
amount to the relevant Holder. 
 (i) If the Company shall fail to pay any capital, stamp, issue, registration and transfer taxes or duties
for which it is responsible as provided in Section 4.08(g), the Holder or Selling Agent, as the case may be, shall be entitled (but shall not be obliged) to tender and pay the same and the Company as a separate and independent obligation,
undertakes to reimburse and indemnify each Holder or Selling Agent, as the case may be, in respect of any payment thereof and any penalties payable in respect thereof. 

(j) The Common Shares issued on Conversion will be fully paid and will in all respects rank pari passu with the fully paid Common Shares
in issue on the relevant Conversion Notice Date, except in any such case for any right excluded by mandatory provisions of applicable law and except that such Common Shares will not rank for (or, as the case may be, the relevant Holder shall not be
entitled to receive) any rights, distributions or payments the record date or other due date for the establishment of entitlement for which falls prior to the Conversion Settlement Date. 

  
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 Section 4.09. Failure to Deliver a Delivery Notice. 

(a) If a duly completed Delivery Notice and the relevant Contingent Convertible Preferred Securities are not delivered to the Paying and
Conversion Agent as provided in the Contingent Convertible Preferred Securities Indenture and the Conversion Notice on or before the Notice Cut-off Date, then at any time following the Notice Cut-off Date and prior to the tenth Business Day after the Conversion Settlement Date, the Company may in its sole and absolute discretion (and the relevant Holders and beneficial owners of such Contingent
Convertible Preferred Securities shall be deemed to agree thereto), elect to appoint a person (the “Selling Agent”) to procure that all Common Shares held by the Conversion Shares Depository in respect of which the applicable
Contingent Convertible Preferred Securities and duly completed Delivery Notice have not been delivered on or before the Notice Cut-off Date as aforesaid be sold by or on behalf of the Selling Agent as soon as
reasonably practicable. 
 (b) Subject to the deduction by or on behalf of the Selling Agent of any amount payable in respect of its
liability to taxation and the payment of any capital, stamp, issue, registration and/or transfer taxes and duties (if any) and any fees or costs incurred by or on behalf of the Selling Agent in connection with the issue, allotment and sale of any
Common Shares pursuant to Section 4.09(a), and the conversion of any proceeds of such sale into U.S. dollars, the net proceeds of such sale, converted into U.S. dollars at the Prevailing Rate on the Notice
Cut-off Date, if necessary, shall as soon as reasonably practicable be distributed ratably to the relevant Holders in such manner and at such time as the Company shall determine and notify to the relevant
Holders. Such payment shall for all purposes discharge the obligations of the Company, the Conversion Shares Depository, the Paying and Conversion Agent and the Selling Agent to such Holders in respect of the relevant Conversion. The Company, the
Conversion Shares Depository, the Paying and Conversion Agent and the Selling Agent shall have no liability in respect of the exercise or non-exercise of any discretion or power pursuant to this
Section 4.09 or in respect of any sale of any Common Shares, whether for the timing of any such sale or the price at or manner in which any such Common Shares are sold or the inability to sell any such Common Shares. Furthermore, the Company,
the Conversion Shares Depository, the Paying and Conversion Agent and the Selling Agent shall have no liability to any Holder or beneficial owner of the Contingent Convertible Preferred Securities for any loss resulting from such Holder’s or
beneficial owner’s failure to receive any Common Shares or ADSs, or from any delay in the receipt thereof, in each case as a result of such Holder or beneficial owner (or custodian, nominee, broker or other representative thereof) failing to
duly submit a Delivery Notice and the relevant Contingent Convertible Preferred Securities on a timely basis or at all. 
 (c) If the
applicable Contingent Convertible Preferred Securities and Delivery Notice are not delivered to the Paying and Conversion Agent on or before the Notice Cut-off Date and the Company does not appoint the Selling
Agent by the 10th Business Day after the Conversion Settlement Date, or if any Common Shares are not sold by the Selling Agent in accordance with this Section 4.09, the Conversion Shares Depository shall continue to hold any Common Shares not
sold by the Selling Agent until a duly completed Delivery Notice and the relevant Contingent Convertible Preferred Securities are so delivered. However, any Holder or beneficial owner (or custodian, broker, nominee or other representative thereof)
of such Contingent Convertible Preferred Securities delivering a Delivery Notice after the Notice Cut-off Date will have to provide evidence of its entitlement to the relevant Common Shares, or if the Holder
so elects, ADSs, satisfactory to the Conversion Shares Depository in its sole and absolute discretion in order to receive delivery of such Common Shares or ADSs (if so elected to be deposited with the ADS Depositary on its behalf). 

Section 4.10. Delivery of ADSs. In respect of any Common Shares that Holders elect to receive in the form of ADSs as specified in
the Delivery Notice, the Conversion Shares Depository shall deposit with the custodian for the ADS Depositary the relevant number of Common Shares to be issued upon Conversion of the relevant Contingent Convertible Preferred Securities, and the ADS
Depositary shall issue the corresponding number of ADSs to the DTC Participant account or registered ADS facility account specified by such Holders (per the
ADS-to-Common Share ratio in effect on the Conversion Settlement Date). However, the issuance of the ADSs by the ADS Depositary may be delayed until the depositary bank
or the custodian receives confirmation that all required approvals have been given and that the Common Shares have been duly transferred to the custodian and that all applicable depositary fees and payments have been paid to the ADS Depositary. 

  
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 ARTICLE 5 

SATISFACTION AND DISCHARGE 

Section 5.01. Satisfaction and Discharge of Contingent Convertible Preferred Securities Indenture. This Contingent Convertible
Preferred Securities Indenture shall upon Company Request cease to be of further effect with respect to the Contingent Convertible Preferred Securities of any series (except as to any surviving rights of registration of transfer or exchange of the
Contingent Convertible Preferred Securities of such series herein expressly provided for), and the Trustee, at the direction and expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Contingent
Convertible Preferred Securities Indenture with respect to the Contingent Convertible Preferred Securities of such series when (a) all Contingent Convertible Preferred Securities of such series theretofore authenticated and delivered (other
than Contingent Convertible Preferred Securities which have been mutilated, destroyed, lost or stolen and which have been replaced or paid as provided in Section 3.06 and Contingent Convertible Preferred Securities for whose payment money has
theretofore been deposited in trust with the Trustee or segregated and held in trust by the Company and thereafter repaid to the Company or discharged from such trust, as provided in Section 11.03) have been delivered to the Trustee for
cancellation; (b) the Company has paid or caused to be paid all other sums payable hereunder by the Company with respect to the Outstanding Contingent Convertible Preferred Securities of such series; and (c) the Company has delivered to
the Trustee an Officer’s Certificate and an Opinion of Counsel. each stating that all conditions precedent herein provided for relating to the satisfaction and discharge of this Contingent Convertible Preferred Securities Indenture with respect
to the Contingent Convertible Preferred Securities of such series have been complied with. 
 In addition, upon the exercise of a Spanish Bail-in Power with respect to a series of Contingent Convertible Preferred Securities which results in the redemption, cancellation, or the conversion into other securities, of all the Amounts Due on such Contingent
Convertible Preferred Securities or such Contingent Convertible Preferred Securities otherwise ceasing to be outstanding, the Contingent Convertible Preferred Securities Indenture shall be deemed satisfied and discharged as to such series of
Contingent Convertible Preferred Securities. 
 Notwithstanding any satisfaction and discharge of this Contingent Convertible Preferred
Securities Indenture with respect to any series of Contingent Convertible Preferred Securities, the obligations of the Company to the Trustee under Section 7.08 of this Contingent Convertible Preferred Securities Indenture and the obligations
of the Company to any Authenticating Agent under Section 7.15 of this Contingent Convertible Preferred Securities Indenture shall survive such satisfaction and discharge. 

ARTICLE 6 
 REMEDIES

 Section 6.01. Enforcement Events. 

(a) Each of the following events is an “Enforcement Event” with respect to any series of Contingent Convertible Preferred
Securities: 
 (i) the breach of any term, obligation or condition binding on the Company under the Contingent Convertible
Preferred Securities of such series (other than any of the Company’s payment obligations under or arising from the Contingent Convertible Preferred Securities of such series, including payment of any Liquidation Preference (and premium, if
any), Distributions or Additional Amounts (including upon a Capital Reduction), payment of the Redemption Price or payment of any damages awarded for breach of any obligations)) (a “Performance Obligation”); or 

(ii) the occurrence of any voluntary or involuntary liquidation or winding-up of the
Company (a “Liquidation Event”). 
 (b) Neither the exercise of the Spanish Bail-in
Power nor the exercise of any other resolution tool by the Relevant Spanish Resolution Authority or any action in compliance therewith shall constitute an Enforcement Event or other default under the terms of the Contingent Convertible Preferred
Securities or this Contingent Convertible Preferred Securities Indenture. 

  
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 Section 6.02. Liquidation Distribution. (a) Subject as provided in
Section 6.02(b) below, in the event of any Liquidation Event, Holders of the Contingent Convertible Preferred Securities of any series (unless previously converted into Common Shares pursuant to Article 4) shall be entitled to receive out of
the assets of the Company available for distribution to Holders of such series, the Liquidation Distribution. Such entitlement will arise before any distribution of assets is made to holders of Common Shares or any other instrument of the Company
ranking junior to the Contingent Convertible Preferred Securities of such series. 
 (b) If, before the occurrence of a Liquidation Event, a
Conversion Event occurs but the relevant conversion of the Contingent Convertible Preferred Securities of such series into Common Shares pursuant to Article 4 is still to take place, Holders of the Contingent Convertible Preferred Securities of such
series will be entitled to receive out of the relevant assets of the Company a monetary amount equal to that which Holders of such Contingent Convertible Preferred Securities of such series would have received on any distribution of the assets of
the Company if such conversion had taken place immediately prior to such Liquidation Event. 
 (c) After payment of the relevant entitlement
in respect of a Contingent Convertible Preferred Security as described in this Section 6.02, such Contingent Convertible Preferred Security will confer no further right or claim to any of the remaining assets of the Company. 

Section 6.03. Limitation of Remedies Upon an Enforcement Event. 

The sole remedies of the Holders of the Contingent Convertible Preferred Securities of a series and the Trustee under the Contingent
Convertible Preferred Securities of such series or this Contingent Convertible Preferred Securities Indenture upon the occurrence of an Enforcement Event shall be: 

(a) with respect to the Enforcement Event set forth in Section 6.01(a)(i), to seek enforcement of the relevant Performance Obligation; and

 (b) with respect to the Enforcement Event set forth in Section 6.01(a)(ii), to enforce the entitlement set forth in
Section 6.02. 
 Section 6.04. No Other Remedies and Other Terms. 

(a) Other than the limited remedies specified in this Article 6, and subject to paragraph (c) below, no remedy against the Company shall
be available to the Trustee (acting on behalf of the Holders) or to the Holders of the Contingent Convertible Preferred Securities of any series, whether for the recovery of amounts owing in respect of such Contingent Convertible Preferred
Securities or under the Contingent Convertible Preferred Securities Indenture, or in respect of any breach by the Company of any of the Company’s obligations under or in respect of the terms of such Contingent Convertible Preferred Securities
or under the Contingent Convertible Preferred Securities Indenture in relation thereto; provided, however, that the Company’s obligations to the Trustee under, and the Trustee’s lien provided for in Section 7.08 of the
Contingent Convertible Preferred Securities Indenture and the Trustee’s rights to have money collected applied first to pay amounts due to it under such Section pursuant to Section 6.08 of the Contingent Convertible Preferred Securities
Indenture shall not be limited or impaired by this Article 6 and expressly survive any Enforcement Event and are not subject to the subordination provisions of Section 13.01. 

(b) Notwithstanding the limitations on remedies specified in this Article 6, (i) the Trustee shall have such powers as are required to be
authorized to it under the Trust Indenture Act in respect of the rights of the Holders under the provisions of the Contingent Convertible Preferred Securities Indenture, and (ii) nothing shall impair the rights of a Holder of the Contingent
Convertible Preferred Securities under the Trust Indenture Act, absent such Holder’s consent, to sue for any payment due but unpaid with respect to the Contingent Convertible Preferred Securities as provided for in Section 6.10;
provided that, in the case of (i) and (ii) above, any payments in respect of, or arising from, the Contingent Convertible Preferred Securities, including any payments or amounts resulting or arising from the enforcement of any rights
under the Trust Indenture Act in respect of the Contingent Convertible Preferred Securities, shall be subject to the subordination provisions set forth in Section 13.01. 

  
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 (c) In furtherance of Section 7.01 of the Contingent Convertible Preferred Securities
Indenture: 
 (i) For purposes of Sections 315(a) and 315(c) of the Trust Indenture Act, the term “default” is
hereby defined to mean an Enforcement Event which has occurred and is continuing. 
 (ii) Notwithstanding anything contained
in the Contingent Convertible Preferred Securities Indenture to the contrary, the duties and responsibilities of the Trustee under this Contingent Convertible Preferred Securities Indenture shall be subject to the protections, exculpations and
limitations on liability afforded to an indenture trustee under the provisions of the Trust Indenture Act. 
 Section 6.05.
Agreement with Respect to Limitation of Remedies for Breach of a Performance Obligation. By its acquisition of the Contingent Convertible Preferred Securities of any series, each Holder and beneficial owner of the Contingent Convertible
Preferred Securities of such series acknowledges and agrees that such Holder and beneficial owner will not seek, and will not direct the Trustee to seek, a claim for damages against the Company in respect of a breach by the Company of a Performance
Obligation and that the sole and exclusive remedy that such Holder, beneficial owner and the Trustee may seek under the Contingent Convertible Preferred Securities of such series and the Contingent Convertible Preferred Securities Indenture for a
breach by the Company of a Performance Obligation is specific performance. 
 Section 6.06. Trustee May File Proofs of Claim. In
case of the pendency of any receivership, insolvency, liquidation, bankruptcy, reorganization, arrangement, adjustment, composition, winding-up or other similar judicial proceeding relative to the Company or
any other obligor upon the Contingent Convertible Preferred Securities of any series or to the property of the Company or such other obligor or their creditors (other than under or in connection with a proceeding not involving bankruptcy or
insolvency), the Trustee (irrespective of whether the Liquidation Preference of the Contingent Convertible Preferred Securities of such series shall then be due and payable as therein expressed or by declaration or otherwise and irrespective of
whether the Trustee shall have made any demand on the Company for the payment of any overdue Liquidation Preference (and premium, if any), Distributions (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on
payment set out in Section 3.08 and Section 3.09) or Additional Amounts) shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act in accordance
with this Contingent Convertible Preferred Securities Indenture in order to have claims of the Holders and the Trustee (including any claim for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents or
counsel) allowed in any such proceeding; provided that the Company shall not, as a result of the bringing of such proceedings, be obliged to pay any sum representing or measured by reference to Liquidation Preference (and premium, if any),
Distributions (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) or Additional Amounts on the Contingent Convertible Preferred Securities
sooner than the same would otherwise have been payable by it. In particular, and subject as aforesaid, the Trustee shall be authorized to collect and receive any moneys and other property payable or deliverable on any such claims and to distribute
the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial proceeding is hereby authorized by each Holder and beneficial owner of a Contingent Convertible Preferred Security to
make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to such Holders or beneficial owners, to pay to the Trustee any amount due to it for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel, and any other amounts due to the Trustee under Section 7.08. 

Subject to Article 9 and Section 10.02, nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder or beneficial owner of any Contingent Convertible Preferred Security any plan of reorganization, arrangement, adjustment, or composition affecting any Contingent Convertible Preferred Securities or the rights
of any Holder or beneficial owner of any Contingent Convertible Preferred Security or to authorize the Trustee to vote in respect of the claim of any such Holder or beneficial owner in any such proceeding. 

The provisions of this Section 6.06 are subject to the provisions of Section 13.01. 

  
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 Section 6.07. Trustee May Enforce Claims Without Possession of Contingent Convertible
Preferred Securities. All rights of action and claims under this Contingent Convertible Preferred Securities Indenture or the Contingent Convertible Preferred Securities, if any, may be prosecuted and enforced by the Trustee without the
possession of any of the Contingent Convertible Preferred Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and
any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel (subject, with regard to the Company, to the provisions of Article 13) be for
the ratable benefit of the Holders of the Contingent Convertible Preferred Securities in respect of which such judgment has been recovered. 

Section 6.08. Application of Money Collected. Any money collected by the Trustee pursuant to this Article or, after an Enforcement
Event, any money or other property distributable in respect of the Company’s obligations under this Contingent Convertible Preferred Securities Indenture in respect of any series of Contingent Convertible Preferred Securities shall, subject to
the provisions of Section 13.02 in relation to waiver of rights of set-off and Section 13.01 in relation to the subordination of the Contingent Convertible Preferred Securities, be applied in the
following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of Liquidation Preference (and premium, if any), Distributions (where not cancelled or deemed cancelled pursuant to, or otherwise
subject to the limitations on payment set out in Section 3.08 and Section 3.09) or Additional Amounts upon presentation of such Contingent Convertible Preferred Securities and the notation thereon of the payment if only partially paid and
upon surrender thereof if fully paid: 
 FIRST: To the payment of all amounts applicable to such series of Contingent Convertible Preferred
Securities in respect of which or for the benefit of which such money has been collected and is due and owing to the Trustee (including any predecessor Trustee) under Section 7.08; 

SECOND: To the payment of the amounts then due and unpaid for Liquidation Preference (and premium, if any) of, Distributions (where not
cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) on and Additional Amounts with respect to, such series of Contingent Convertible Preferred Securities
in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the aggregate amounts due and payable on such Contingent Convertible Preferred Securities for
Liquidation Preference (and premium, if any), Distributions (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) and Additional Amounts, if any,
respectively; and 
 THIRD: To the payment of the balance, if any, to the Company or any other Person or Persons entitled thereto. 

Section 6.09. Limitation on Suits. No Holder (which, for the purposes of this Section 6.09, includes each holder of a
beneficial interest in the Contingent Convertible Preferred Securities of any series) of any Contingent Convertible Preferred Security of any series shall have any right to institute any proceeding, judicial or otherwise, with respect to such
Contingent Convertible Preferred Security, this Contingent Convertible Preferred Securities Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless 

(a) such Holder has previously given written notice to the Trustee of a continuing Enforcement Event with respect to Contingent Convertible
Preferred Securities of the same series specifying such Enforcement Event and stating that such notice is a “Notice of Enforcement Event” hereunder; 

(b) the Holders of not less than 25% in aggregate Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of such
series shall have made written request to the Trustee to institute proceedings in respect of such Enforcement Event in its own name, as Trustee hereunder; 

(c) such Holder of a Contingent Convertible Preferred Security has offered to the Trustee reasonable indemnity satisfactory to the Trustee
against the costs, expenses and liabilities to be incurred in compliance with such request; 

  
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 (d) the Trustee for 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 a majority in Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of such series; 

it being understood and intended that no one or more Holders of Contingent Convertible Preferred Securities of a particular series shall have any right in any
manner whatever by virtue of, or by availing of, any provision of this Contingent Convertible Preferred Securities Indenture or any Contingent Convertible Preferred Security to affect, disturb or prejudice the rights of any other such Holder or
Holders of any Contingent Convertible Preferred Security, or to obtain or to seek to obtain priority or preference over any other such Holder or Holders or to enforce any right under this Contingent Convertible Preferred Securities Indenture, except
in the manner herein provided and for the equal and ratable benefit of all Holders of Contingent Convertible Preferred Securities of such series or Holders of any other Contingent Convertible Preferred Security. 

Section 6.10. Unconditional Right of Holders to Receive Liquidation Preference (and Premium, if any), Distributions and Additional
Amounts. Notwithstanding any other provision in this Contingent Convertible Preferred Securities Indenture, and subject to as otherwise provided in this Article 6, Article 13 in relation to the subordination of the Contingent Convertible
Preferred Securities of any series and Article 14 on the exercise of the Spanish-Bail in Power, the Holder of any Contingent Convertible Preferred Security shall have the right, which is absolute and unconditional, to receive payment of the
Liquidation Preference (and premium, if any) of, any Distribution (where not cancelled or deemed cancelled pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) on and any Additional
Amounts with respect to such Contingent Convertible Preferred Security when due and payable in accordance with the provisions of the Contingent Convertible Preferred Securities Indenture (including Article 3, Article 6, Article 13 and Article 14
hereof) and as expressed in such Contingent Convertible Preferred Security (or, in the case of redemption, on the Redemption Date, as the case may be) and to institute suit for the enforcement of any such payment, and such rights shall not be
impaired without the consent of such Holder. 
 Section 6.11. Restoration of Rights and Remedies. If the Trustee or any
Holder of any Contingent Convertible Preferred Security has instituted any proceeding to enforce any right or remedy under this Contingent Convertible Preferred Securities Indenture and such proceeding has been discontinued or abandoned for any
reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders of Contingent Convertible Preferred Securities shall be
restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders of Contingent Convertible Preferred Securities shall continue as though no such proceeding had been
instituted. 
 Section 6.12. Rights and Remedies Cumulative. Subject to the limitations on remedies provided for in this Article
6, except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Contingent Convertible Preferred Securities in the last paragraph of Section 3.06, no right or remedy herein conferred upon or
reserved to the Trustee or to the Holders of Contingent Convertible Preferred Securities is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to
every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise. The assertion or employment of any right or remedy hereunder, or otherwise, shall not, subject as aforesaid, prevent the concurrent assertion
or employment of any other appropriate right or remedy. 
 Section 6.13. Delay or Omission Not Waiver. No delay or omission of
the Trustee or of any Holder of any Contingent Convertible Preferred Security to exercise any right or remedy accruing upon any Enforcement Event shall impair any such right or remedy or constitute a waiver of any such Enforcement Event or an
acquiescence therein. Every right and remedy given by this Article or by law to the Trustee or to the Holders of Contingent Convertible Preferred Securities may be exercised from time to time, and as often as may be deemed expedient, by the Trustee
or by the Holders of Contingent Convertible Preferred Securities, as the case may be. 

  
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 Section 6.14. Control by Holders. The Holders of a majority in aggregate Liquidation
Preference of the Outstanding Contingent Convertible Preferred Securities of any series shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee hereunder, or exercising any trust
or power conferred on the Trustee hereunder, with respect to the Contingent Convertible Preferred Securities of such series, provided that: 

(a) such direction shall not be in conflict with any rule of law or with this Contingent Convertible Preferred Securities Indenture or with the
Contingent Convertible Preferred Securities of any series; 
 (b) the Trustee shall not determine that the action so directed would be
unjustly prejudicial to the Holders of any Contingent Convertible Preferred Securities of any series not taking part in such direction with respect to which the Trustee is acting as the Trustee; and 

(c) the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction. 

Section 6.15. Undertaking for Costs. All parties to this Contingent Convertible Preferred Securities Indenture agree, and each
Holder and beneficial owner of any Contingent Convertible Preferred Security by his acceptance thereof shall be deemed to have agreed, that any court may in its discretion require, in any suit for the enforcement of any right or remedy under this
Contingent Convertible Preferred Securities Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, the filing by any party litigant to such suit of an undertaking to pay the costs of such suit, and
that such court may in its discretion assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in such suit, having due regard to the merits and good faith of the claims or defenses made by such
party litigant; but the provisions of this Section shall not apply to any suit instituted by the Trustee, to any suit instituted by any Holder or group of Holders holding in the aggregate more than 10% in Liquidation Preference of the Outstanding
Contingent Convertible Preferred Securities of any series, or to any suit instituted by any Holder for the enforcement of the payment of the Liquidation Preference (and premium, if any) of, any Distribution (where not cancelled or deemed cancelled
pursuant to, or otherwise subject to the limitations on payment set out in Section 3.08 and Section 3.09) on or any Additional Amounts with respect to any Contingent Convertible Preferred Security on or after the dates upon which such
amounts become due and payable pursuant to the terms hereof or the terms expressed in such Contingent Convertible Preferred Security (or, in the case of redemption on or after the Redemption Date). 

Section 6.16. Waiver of Past Enforcement Events. (a) Holders of not less than a majority in aggregate Liquidation Preference
of the Outstanding Contingent Convertible Preferred Securities of any series may on behalf of the Holders of all of the Contingent Convertible Preferred Securities of such series waive any past Enforcement Event that results from a breach by the
Company of a Performance Obligation. Holders of a majority of the aggregate Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of any series shall not be entitled to waive (i) any past Enforcement Event that
results from a Liquidation Event and (ii) any Enforcement Event in respect of a covenant or provision hereof which under Article 10 cannot be modified or amended without the consent of the Holder of each Outstanding Contingent Convertible
Preferred Security of such series affected. 
 (b) Upon the occurrence of any waiver permitted by paragraph (a) above, such Enforcement
Event shall cease to exist, and any Enforcement Event with respect to the Contingent Convertible Preferred Securities arising therefrom shall be deemed to have been cured and not to have occurred for every purpose of the Contingent Convertible
Preferred Securities Indenture, but no such waiver shall extend to any subsequent or other Enforcement Event or impair any right consequent thereon. 

ARTICLE 7 
 THE
TRUSTEE 
 Section 7.01. Certain Duties and Responsibilities. 

(a) Except during the continuance of an Enforcement Event, 

  
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 (i) the Trustee undertakes to perform such duties and only such duties as are
specifically set forth in this Contingent Convertible Preferred Securities Indenture and the Trust Indenture Act, and no implied covenants or obligations shall be read into this Contingent Convertible Preferred Securities Indenture against the
Trustee, except as otherwise required by the Trust Indenture Act; and 
 (ii) the Trustee may rely and shall be protected in
acting or refraining from acting upon any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, or other paper or document reasonably believed by it to be genuine and to
have been signed or presented by the proper party or parties. 
 (b) In case an Enforcement Event has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Contingent Convertible Preferred Securities Indenture, and use the same degree of care and skill in their exercise, as a prudent person would exercise or use under the circumstances
in the conduct of his or her own affairs. 
 (c) No provision of this Contingent Convertible Preferred Securities Indenture shall be
construed to relieve the Trustee from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that 

(i) this Section 7.01(c) shall not be construed to limit the effect of subsection (a)(i) or subsection (d) of this
Section; 
 (ii) the Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer,
unless the Trustee was negligent in ascertaining the pertinent facts; and 
 (iii) the Trustee shall not be liable with
respect to any action taken, suffered or omitted to be taken by it in good faith in accordance with the direction of the Holders of a majority in Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of any series,
determined as provided herein, relating to the time, method and place of conducting any proceeding for any remedy available to the Trustee, or exercising any trust or power conferred upon the Trustee, under this Contingent Convertible Preferred
Securities Indenture with respect to the Contingent Convertible Preferred Securities of such series; 
 (d) No provision of this Contingent
Convertible Preferred Securities Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers, if
it shall have reasonable grounds for believing that repayment of such funds or adequate indemnity against such risk or liability is not reasonably assured to it; and 

(e) Whether or not therein expressly so provided, every provision of this Contingent Convertible Preferred Securities Indenture relating to the
conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section. 

Section 7.02. Spanish Tax Procedures and Obligations of the Trustee. In connection with each payment made on any Payment Date (as
defined in Appendix 1 attached hereto) in respect of the issued Contingent Convertible Preferred Securities hereunder, the Trustee or Paying Agent (as the Company may determine in connection with the establishment of each series of Contingent
Convertible Preferred Securities) shall comply with the tax procedures set forth in Appendix 1 hereto. The Trustee or Paying Agent shall have no duty or responsibility to comply with other Spanish tax obligations arising out of this Contingent
Convertible Preferred Securities Indenture. The Company shall be responsible for the payment of any and all amounts due under the Contingent Convertible Preferred Securities. Therefore, the Trustee or Paying Agent shall not be liable for any amounts
owed to any person due to its failure to properly comply with the tax procedures referred to in this Section 7.02 and Appendix 1 hereto, except such as may result from the negligence, willful misconduct or fraud of the Trustee or 

  
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Paying Agent or any of its employees. The Trustee or Paying Agent may request and rely conclusively upon any instructions from the Company in respect of any action necessary or required to be
taken by the Trustee or Paying Agent pursuant to this Section 7.02 and Appendix 1 hereto; provided, however, in no event shall the Trustee or Paying Agent be required to expend or risk its own funds in the performance of any of its
duties pursuant to this Section 7.02 and Appendix 1 hereto, or be obligated to take any legal or other action which might in its judgment involve or cause it to incur any expense or liability unless it shall have been furnished with acceptable
indemnification and security. 
 Section 7.03. Notice of Enforcement Events. Within 90 days after the occurrence of any
Enforcement Event hereunder with respect to Contingent Convertible Preferred Securities of any series of which a Responsible Officer of the Trustee has received written notice, the Trustee shall transmit in the manner and to the extent provided in
Section 1.06 to Holders of Contingent Convertible Preferred Securities of such series notice of such Enforcement Event hereunder of which the Trustee has received written notice, unless such Enforcement Event shall have been cured or waived;
provided, however, that the Trustee shall be protected in withholding such notice if it determines in good faith that the withholding of such notice is in the interest of the Holders of Contingent Convertible Preferred Securities of such
series. 
 Section 7.04. Certain Rights of Trustee. Subject to the provisions of Section 7.01 and Sections 315(a) through
315(d) of the Trust Indenture Act:  
 (a) the Trustee may rely and shall be protected in acting or refraining from acting upon any
resolution, Officer’s Certificate, or any other certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, coupon or other evidence of indebtedness or other paper or document (whether
in its original or facsimile form) reasonably believed by it to be genuine and to have been signed or presented by the proper party or parties; 

(b) any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any
resolution of the Board of Directors of the Company may be sufficiently evidenced by a Board Resolution; 
 (c) whenever in the
administration of this Contingent Convertible Preferred Securities Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence
be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officer’s Certificate and/or an Opinion of Counsel; 

(d) the Trustee may consult with counsel and the written advice of such counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon; 

(e) the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Contingent Convertible Preferred
Securities Indenture at the request or direction of any of the Holders pursuant to this Contingent Convertible Preferred Securities Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to the
Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction; 
 (f) the
Trustee shall not be bound to make any investigation or inquiry into (i) the performance of the Company of any of its covenants set forth in this Contingent Convertible Preferred Securities Indenture and (ii) the facts or matters stated in
any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such
facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled to examine, during business hours and upon reasonable notice, the books, records and premises of the Company,
personally or by agent or attorney; provided that the Trustee shall not be entitled to such information which the Company is prevented from disclosing as a matter of law or contract; 

  
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 (g) the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder
either directly or by or through agents or attorneys and the Trustee shall not be responsible for any misconduct or negligence on the part of any third-party agent or attorney appointed with due care by it hereunder; 

(h) anything in this Contingent Convertible Preferred Securities Indenture notwithstanding, in no event shall the Trustee be liable to the
Company for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including but not limited to loss of profit), even if the Trustee has been advised as to the likelihood of such loss or damage and regardless of whether
the claim for loss or damage is made in negligence or otherwise; 
 (i) the Trustee shall not be liable for any action taken, suffered, or
omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Contingent Convertible Preferred Securities Indenture, unless the Trustee was negligent in
ascertaining the pertinent facts; 
 (j) the Trustee shall not be deemed to have notice of any Enforcement Event unless a Responsible Officer
of the Trustee has received, at the Corporate Trust Office of the Trustee, written notice of such an Enforcement Event and such notice references the Contingent Convertible Preferred Securities and/or this Contingent Convertible Preferred Securities
Indenture and is given in the manner required by Section 1.05(a) hereof; 
 (k) the rights, privileges, protections, immunities and
benefits given to the Trustee pursuant to this Contingent Convertible Preferred Securities Indenture, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and each agent, custodian and other Person employed by the Company to act hereunder, provided, however, that each such Person shall be deemed to have acknowledged, accepted and agreed to be bound, and will be bound, by
Section 14.02 hereof, on the same terms as the Trustee, with respect to any BRRD Liability of the Company to any such Person; 
 (l) the
Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Contingent Convertible Preferred Securities Indenture,
which certificate may be signed by any person authorized to sign an Officer’s Certificate, including any person specified as so authorized in any such certificate previously delivered and not superseded; 

(m) the permissive rights of the Trustee enumerated herein shall not be construed as duties; and 

(n) the Trustee shall not be liable for any failure or delay in the performance of its obligations hereunder arising out of, or caused by,
directly or indirectly, forces beyond its control, including, but not limited to, acts of God, flood, war (whether declared or undeclared), terrorism, civil or military disturbances, strikes, work stoppages, accidents, nuclear or natural
catastrophes or fire; it being understood that the Trustee shall use reasonable best efforts which are consistent with generally accepted practices in the banking industry to resume performance as soon as practicable under the circumstances. 

Section 7.05. Not Responsible for Recitals or Issuance of Contingent Convertible Preferred Securities. The recitals contained
herein and in the Contingent Convertible Preferred Securities, except the Trustee’s and any Authenticating Agent’s certificates of authentication, shall be taken as the statements of the Company, and neither the Trustee nor any
Authenticating Agent assumes any responsibility for their correctness. The Trustee makes no representations as to the validity or sufficiency of this Contingent Convertible Preferred Securities Indenture or of the Contingent Convertible Preferred
Securities, except that the Trustee represents and warrants that it is duly authorized to execute and deliver this Contingent Convertible Preferred Securities Indenture, authenticate the Contingent Convertible Preferred Securities and perform its
obligations hereunder and that the statements made by it in a Statement of Eligibility and Qualification on Form T-1 supplied to the Company are true and accurate, subject to the qualifications set forth
therein. Neither the Trustee nor any Authenticating Agent shall be accountable for the use or application by the Company of Contingent Convertible Preferred Securities or the proceeds thereof. 

  
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 Section 7.06. May Hold Contingent Convertible Preferred Securities. The Trustee, any
Authenticating Agent, any Paying Agent, any Contingent Convertible Preferred Security Registrar and any Calculation Agent or any other agent of the Company, in its individual or any other capacity, may become the owner or pledgee of Contingent
Convertible Preferred Securities and, subject to Section 7.11 and Section 7.15 and Sections 310(b) and 311 of the Trust Indenture Act, may otherwise deal with the Company with the same rights it would have if it were not Trustee,
Authenticating Agent, Paying Agent, Contingent Convertible Preferred Security Registrar, Calculation Agent or such other agent. 

Section 7.07. Money Held in Trust. Money held by the Trustee in trust hereunder need not be segregated from other funds except to
the extent required by law. Moneys received by the Trustee shall be held uninvested and the Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed in writing with the Company. 

Section 7.08. Compensation and Reimbursement. The Company agrees: 

(a) to pay to the Trustee from time to time reasonable compensation for all services rendered by it hereunder as agreed upon in writing by the
Company and the Trustee from time to time (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); 

(b) except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and
advances incurred or made by the Trustee in accordance with any provision of this Contingent Convertible Preferred Securities Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any
such expense, disbursement or advance as may be attributable to the Trustee’s negligence or bad faith; and 
 (c) to indemnify the
Trustee (which for the purposes of this Section 6.07(a)(iii) shall include its officers, directors, employees and agents acting on behalf of the Trustee) for, and to hold it harmless against, any loss, liability or expense (other than taxes
based upon, measured by or determined by the income of the Trustee) incurred without negligence or bad faith on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder, including the costs and
expenses of defending itself against any claim or liability in connection with the exercise or performance of any of its powers or duties hereunder, except to the extent that any such loss, liability or expense may be attributable to its negligence
or bad faith. 
 In addition to, but without prejudice to its other rights under this Contingent Convertible Preferred Securities Indenture,
when the Trustee incurs expenses or renders services in connection with an Enforcement Event specified in Section 6.01, the fees, costs and expenses (including the charges and expenses of its counsel) and the compensation for the services are
intended, to the extent permitted under applicable law, to constitute expenses of administration under any applicable bankruptcy, insolvency or other similar law. 

The Trustee shall notify the Company in writing of the commencement of any action or claim in respect of which indemnification may be sought
promptly after a Responsible Officer of the Trustee becomes aware of such commencement (provided that the failure to make such notification shall not affect the Trustee’s rights hereunder) and the Company shall be entitled to participate
therein. The Trustee shall not be authorized to settle a claim without the written consent of the Company, which consent shall not be unreasonably withheld. 

As security for the performance of the obligations of the Company under this Section, the Trustee shall have a senior lien to which the
Contingent Convertible Preferred Securities are hereby made subordinate, upon all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of Liquidation Preference (or premium, if any), Distributions
or Additional Amounts on the Contingent Convertible Preferred Securities. 
 “Trustee” for purposes of this Section shall
include any predecessor Trustee; provided, however, that the negligence, willful misconduct or bad faith of any Trustee hereunder shall not affect the rights of any other Trustee hereunder. 

  
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 The Trustee’s rights to payment of its fees, reimbursement and indemnity under this
Section 7.08 shall survive the payment in full of the Contingent Convertible Preferred Securities, the satisfaction and discharge of this Contingent Convertible Preferred Securities Indenture, the resignation or removal of the Trustee, the
termination for any reason of this Contingent Convertible Preferred Securities Indenture and (without prejudice to Section 14.02 of this Indenture if, and to the extent applicable, as set out therein) any exercise of the Spanish Bail-in Power with respect to the Contingent Convertible Preferred Securities of any series. 

Section 7.09. Disqualification; Conflicting Interests. 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, Section 310(b) of the Trust Indenture Act and this Contingent
Convertible Preferred Securities Indenture. 
 Section 7.10. Corporate Trustee Required; Eligibility. There shall at all times
be a Trustee hereunder with respect to each series of Contingent Convertible Preferred Securities which shall be a Person organized and doing business under the laws of the United States of America or of any state or territory or of the District of
Columbia (or a corporation or other person permitted to act as Trustee by the Commission), eligible under Sections 310(a)(1), 310(a)(5) and 310(b) of the Trust Indenture Act to act as trustee under an indenture qualified under the Trust Indenture
Act and that has a combined capital and surplus (computed in accordance with Section 310(a)(2) of the Trust Indenture Act) of at least $50,000,000 subject to supervision or examination by a U.S. federal or state authority. If at any time the
Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article 7. 

Section 7.11. Resignation and Removal; Appointment of Successor. 

(a) No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until
the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 7.12. 
 (b) The
Trustee may resign at any time with respect to the Contingent Convertible Preferred Securities of one or more series by giving written notice thereof to the Company. If the instrument of acceptance by a successor Trustee required by
Section 7.12 shall not have been delivered to the Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition any court of competent jurisdiction for the appointment of a successor Trustee with
respect to the Contingent Convertible Preferred Securities of such series. 
 (c) The Trustee may be removed at any time with respect to the
Contingent Convertible Preferred Securities of any series by Act of the Holders of a majority in Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of such series delivered to the Trustee and to the Company. If the
instrument of acceptance by a successor Trustee required by Section 7.12 shall not have been delivered to the Trustee within 30 days after the giving of such notice of removal, the Trustee may petition at the expense of the Company any court of
competent jurisdiction for the appointment of a successor Trustee with respect to the Contingent Convertible Preferred Securities of such series. 

(d) If at any time: 

(i) the Trustee shall fail to comply with Section 7.09 after written request therefor by the Company or by any Holder who
has been a bona fide Holder of a Contingent Convertible Preferred Security of the series as to which the Trustee has a conflicting interest for at least six months, or 

(ii) the Trustee shall cease to be eligible under Section 7.10 and shall fail to resign after written request therefor by
the Company or by any Holder, or 
 (iii) the Trustee shall become incapable of acting or shall be adjudged a bankrupt or
insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge, or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation, 

  
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 then, in any such case, (i) the Company, by
or pursuant to a Company Order, may remove the Trustee with respect to any or all series of Contingent Convertible Preferred Securities or (ii) subject to Section 6.15, any Holder who has been a bona fide Holder of a Contingent
Convertible Preferred Security for at least six months (and, in the case of (i) above, who is a Holder of a Contingent Convertible Preferred Security of the series as to which the Trustee has a conflicting interest) may, on behalf of himself
and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee with respect to all Contingent Convertible Preferred Securities of such series and the appointment of a successor Trustee or Trustees with
respect to such series of Contingent Convertible Preferred Securities. 
 (e) If the Trustee shall resign, be removed or become incapable of
acting, or if a vacancy shall occur in the office of Trustee for any cause, with respect to the Contingent Convertible Preferred Securities of one or more series, the Company, by or pursuant to a
Company Order, shall promptly appoint a successor Trustee or Trustees with respect to the Contingent Convertible Preferred Securities of such series (it being understood that any successor Trustee may be appointed with respect to the Contingent
Convertible Preferred Securities of one or more or all of such series and that at any time there shall be only one Trustee with respect to the Contingent Convertible Preferred Securities of any particular series), and shall comply with the
applicable requirements of Section 7.12. If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee with respect to the Contingent Convertible Preferred Securities of any series
shall be appointed by Act of the Holders of a majority in Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of such series delivered to the Company and the retiring Trustee, the successor Trustee so appointed
shall, forthwith upon its acceptance of such appointment in accordance with the applicable requirements of Section 7.12, become the successor Trustee with respect to the Contingent Convertible Preferred Securities of such series and to that
extent supersede the successor Trustee appointed by the Company. If no successor Trustee with respect to the Contingent Convertible Preferred Securities of any series shall have been so appointed by the Company or the Holders of Contingent
Convertible Preferred Securities of such series and accepted appointment in the manner hereinafter required by Section 7.12, any Holder who has been a bona fide Holder of a Contingent Convertible Preferred Security of such series for at least
six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee with respect to the Contingent Convertible Preferred Securities of such series. 

(f) The Company shall give notice to Holders of the Contingent Convertible Preferred Securities of any series of each resignation and each
removal of the Trustee with respect to the Contingent Convertible Preferred Securities of such series and each appointment of a successor Trustee with respect to the Contingent Convertible Preferred Securities of such series in the manner and to the
extent provided in Section 1.06. Each notice shall include the name of the successor Trustee with respect to the Contingent Convertible Preferred Securities of such series and the address of its Corporate Trust Office. 

Section 7.12. Acceptance of Appointment by Successor. 

(a) In case of the appointment hereunder of a successor Trustee with respect to all Contingent Convertible Preferred Securities, every such
successor Trustee so appointed shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and
such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on request of the Company or the successor Trustee, such retiring Trustee shall,
upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee, all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and
money held by such retiring Trustee hereunder, subject nevertheless to its claim, if any, provided for in Section 7.08. 
 (b) In case
of the appointment hereunder of a successor Trustee with respect to the Contingent Convertible Preferred Securities of one or more (but not all) series, the Company, the retiring Trustee and each successor Trustee with respect to the Contingent
Convertible Preferred Securities of each such series shall execute and deliver an indenture supplemental hereto wherein each successor Trustee shall accept such appointment and which (i) shall contain such provisions as shall be necessary or
desirable to transfer and confirm to, and to vest in, each successor Trustee all the rights, powers, trusts and duties of the retiring Trustee with respect to the Contingent Convertible Preferred Securities of such series to which the appointment of
such successor Trustee relates, (ii) if the 

  
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retiring Trustee is not retiring with respect to all Contingent Convertible Preferred Securities, shall contain such provisions as shall be deemed necessary or desirable to confirm that all the
rights, powers, trusts and duties of the retiring Trustee with respect to the Contingent Convertible Preferred Securities of such series as to which the retiring Trustee is not retiring shall continue to be vested in the retiring Trustee, and
(iii) shall add to or change any of the provisions of this Contingent Convertible Preferred Securities Indenture as shall be necessary to provide for or facilitate the administration of the trusts hereunder by more than one Trustee, it being
understood that nothing herein or in such supplemental indenture shall constitute such Trustees co-trustees of the same trust and that each such Trustee shall be trustee of a trust or trusts hereunder separate
and apart from any trust or trusts hereunder administered by any other such Trustee; and upon the execution and delivery of such supplemental indenture the resignation or removal of the retiring Trustee shall become effective to the extent provided
therein and each such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee with respect to the Contingent Convertible Preferred Securities of such
series to which the appointment of such successor Trustee relates; but, on request of the Company or any successor Trustee, such retiring Trustee, upon payment of its charges with respect to the Contingent Convertible Preferred Securities of such
series to which the appointment of such successor relates shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder with respect to the Contingent Convertible Preferred
Securities of such series to which the appointment of such successor Trustee relates, subject to its claim, if any, provided for in Section 7.08. 

(c) Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and
confirming to such successor Trustee all such rights, powers and trusts referred to in paragraph (a) or (b) of this Section 7.12, as the case may be. 

(d) No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and
eligible under this Article 7. 
 Section 7.13. Merger, Conversion, Consolidation or Succession to Business. Any Person into
which the Trustee may be merged or converted or with which it may be consolidated, or any Person resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any Person succeeding to all or substantially all the
corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided such Person shall be otherwise qualified and eligible under this Article, without the execution or filing of any paper or any further act on the part
of any of the parties hereto. In case any Contingent Convertible Preferred Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating
Trustee may adopt such authentication and deliver the Contingent Convertible Preferred Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Contingent Convertible Preferred Securities. 

Section 7.14. Preferential Collection of Claims. If and when the Trustee shall be or become a creditor of the Company (or any
other obligor upon the Contingent Convertible Preferred Securities of a series), 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). 

Section 7.15. Appointment of Authenticating Agent. The Trustee may at any time appoint an Authenticating Agent or Agents
acceptable to the Company with respect to one or more series of Contingent Convertible Preferred Securities which shall be authorized to act on behalf of the Trustee to authenticate Contingent Convertible Preferred Securities of such series upon
original issue, or issued upon exchange, registration of transfer or partial redemption or Conversion thereof or in lieu of mutilated, destroyed, lost or stolen Contingent Convertible Preferred Securities, and Contingent Convertible Preferred
Securities so authenticated shall be entitled to the benefits of this Contingent Convertible Preferred Securities Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder. Wherever reference is made
in this Contingent Convertible Preferred Securities Indenture to the authentication and delivery of Contingent Convertible Preferred Securities by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to
include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent. Notwithstanding any other provision of this Contingent
Convertible Preferred Securities Indenture, the Contingent Convertible Preferred Securities shall be issued and authenticated in New York. 

  
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 Each Authenticating Agent shall be acceptable to the Company and, except as provided in or
pursuant to this Contingent Convertible Preferred Securities Indenture, shall at all times be a Person that would be permitted by the Trust Indenture Act to act as trustee under an indenture qualified under the Trust Indenture Act, is authorized
under applicable law and by its charter to act as an Authenticating Agent and has a combined capital and surplus (computed in accordance with Section 310(a)(2) of the Trust Indenture Act) of at least $50,000,000. If at any time an
Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect specified in this Section. 

Any Person into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any Person resulting from
any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any Person succeeding to the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent,
provided such Person shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent. 

An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company. The Trustee may at any time
terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company. Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating
Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be acceptable to the Company and shall give notice to the Holders of Contingent Convertible
Preferred Securities in the manner and to the extent provided in Section 1.06. Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor
hereunder, with like effect as if originally named as an Authenticating Agent. No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section. 

The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this
Section 7.15. 
 If an appointment with respect to one or more series is made pursuant to this Section, the Contingent Convertible
Preferred Securities of such series may have endorsed thereon, in lieu of the Trustee’s certificate of authentication, an alternate certificate of authentication in substantively the following form: 

This is one of the Contingent Convertible Preferred Securities referred to in the within-mentioned Contingent Convertible Preferred Securities
Indenture. 
  

			
	THE BANK OF NEW YORK MELLON, as Trustee
		
	By:	 	  

		 	as Authenticating Agent
		
	By:	 	  

		 	Authorized Signatory

 Section 7.16. Appointment of Additional Trustees. The Company may appoint a Trustee for a
particular series of Contingent Convertible Preferred Securities other than the Trustee named in the first paragraph of this Contingent Convertible Preferred Securities Indenture by executing and delivering an indenture supplemental hereto where
such Trustee accepts such appointment as contemplated by Section 10.01(l) (it being understood that at any time there shall be only one Trustee with respect to the Contingent Convertible Preferred Securities of any particular series);
provided that, at the time of such acceptance, such Trustee shall be qualified and eligible under this Article 7. Upon such acceptance, such Trustee shall be vested with all the rights, powers, trusts and duties of a Trustee under this
Contingent Convertible Preferred Securities Indenture with respect to the Contingent Convertible Preferred Securities of such series. 

  
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 Section 7.17. Tax Withholding. Any amounts to be paid by the Company on the
Contingent Convertible Preferred Securities shall be paid net of any deduction or withholding imposed or required pursuant to Sections 1471 through 1474 of the U.S. Internal Revenue Code of 1986, as amended (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 (or any law implementing such an intergovernmental agreement) (a “FATCA Withholding Tax”), and the Company shall not be required to pay Additional
Amounts on account of any FATCA Withholding Tax. 
 In order to enable the Trustee and the Paying Agent to comply with applicable tax laws
(inclusive of rules, regulations and interpretations promulgated by competent authorities) in effect from time to time, including, without limitation FATCA Withholding Tax (“Applicable Tax Law”) that the Company, Trustee or any
Paying Agent is subject to, the Company agrees (i) to cooperate in good faith with the Trustee and each Paying Agent by providing information, to the extent within the Company’s possession, and to the extent permitted by applicable law,
about the parties and/or Contingent Convertible Preferred Securities (including any modification to the terms of such Contingent Convertible Preferred Securities) that is reasonably necessary for such entity to determine whether it has tax related
obligations under Applicable Tax Law and (ii) that the Trustee and each Paying Agent shall be entitled to make any withholding or deduction from payments to the extent necessary to comply with Applicable Tax Law. For the avoidance of doubt,
neither the Trustee nor any Paying Agent shall have any obligation to gross up any payment hereunder or pay any additional amount or otherwise indemnify a Holder as a result of such withholding tax. The terms of this section shall survive the
termination of this Contingent Convertible Preferred Securities Indenture or the resignation or removal of the Trustee or any Paying Agent. 

ARTICLE 8 
 HOLDERS
LISTS AND REPORTS BY TRUSTEE AND COMPANY 

Section 8.01. Company to Furnish Trustee Names and Addresses of Holders. The Company, with respect to any series of Contingent
Convertible Preferred Securities, will furnish or cause to be furnished to the Trustee: 
 (a) not more than 15 days after each Regular
Record Date (except if the Distribution payable on the Distribution Payment Date relating to such Regular Record Date is cancelled or deemed cancelled pursuant to Section 3.08 or Section 3.09), and in any event at intervals of not more
than six months, a list, in such form as the Trustee may reasonably require, of the names and addresses of the Holders of Contingent Convertible Preferred Securities as of such Regular Record Date, and 

(b) at such other times as the Trustee may request in writing, within 30 days after the receipt by the Company of any such request, a list of
similar form and content as of a date not more than 15 days prior to the time such list is furnished. 
 The Company need not furnish or
cause to be furnished to the Trustee pursuant to this Section 8.01 the names and addresses of Holders of Contingent Convertible Preferred Securities so long as the Trustee acts as Contingent Convertible Preferred Security Registrar with respect
to such series of Contingent Convertible Preferred Securities. 
 Section 8.02. Preservation of Information; Communication to
Holders. 
 (a) The Trustee shall comply with the obligations imposed upon it pursuant to Section 312 of the Trust Indenture Act.
The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders (i) contained in the most recent list furnished to the Trustee as provided in Section 8.01 and (ii) received by the
Trustee in its capacity as Paying Agent or Contingent Convertible Preferred Security Registrar (if so acting). The Trustee may dispose of any list furnished to it as provided in Section 8.01 upon receipt of a new list so furnished. 

  
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 (b) The rights of the Holders of Contingent Convertible Preferred Securities of any series to
communicate with other Holders with respect to their rights under this Contingent Convertible Preferred Securities Indenture or under the Contingent Convertible Preferred Securities, and the corresponding rights and privileges of the Trustee, shall
be as provided by the Trust Indenture Act. 
 (c) Every Holder, by receiving and holding a Contingent Convertible Preferred Security, agrees
with the Company and the Trustee that neither the Company nor the Trustee nor any agent of any of them shall be held accountable by reason of the disclosure of any such information as to the names and addresses of the Holders in accordance with this
Section 8.02 or otherwise made pursuant to the Trust Indenture Act. 
 Section 8.03. Reports by Trustee. 

(a) On or before May 15 in each year following the date hereof, so long as any Contingent Convertible Preferred Securities are Outstanding
hereunder, the Trustee shall transmit to Holders as provided in the Trust Indenture Act a brief report dated as of a date required by and in compliance with Section 313(a) of the Trust Indenture Act. The Trustee shall transmit reports required
by Section 313(b) of the Trust Indenture Act at the times specified therein. 
 (b) A copy of each such report shall, at the time of
such transmission to Holders, be filed by the Trustee with each securities exchange upon which the Trustee has been notified that the Contingent Convertible Preferred Securities are listed, with the Commission and with the Company. The Company will
notify the Trustee when Contingent Convertible Preferred Securities are listed on any securities exchange. 
 Section 8.04. Reports
by Company. 
 So long as any Contingent Convertible Preferred Securities are Outstanding, the Company shall: 

(a) file with the Trustee, within 15 days after the Company files the same with the Commission, copies of the annual reports and of the
information, documents and other reports (or copies of such portions of any of the foregoing as the Commission may from time to time by rules and regulations prescribe) which the Company may be required to file with the Commission pursuant to
Section 13 or Section 15(d) of the Exchange Act; or, if the Company is not required to file information, documents or reports pursuant to either of such Sections, then it shall file with the Trustee and the Commission, in accordance with
rules and regulations prescribed from time to time by the Commission, such of the supplementary and periodic information, documents and reports which may be required pursuant to Section 13 or 15(d) of the Exchange Act in respect of a security
listed and registered on a national securities exchange as may be prescribed from time to time in such rules and regulations. Delivery of such reports, information and documents to the Trustee is for informational purposes only and the
Trustee’s receipt of such shall not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder
(as to which the Trustee is entitled to rely exclusively on an Officer’s Certificate); 
 (b) file with the Trustee and the Commission,
in accordance with rules and regulations prescribed from time to time by the Commission, such additional information, documents and reports with respect to compliance by the Company with the conditions and covenants of this Contingent Convertible
Preferred Securities Indenture as may be required from time to time by such rules and regulations. Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not
constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to
rely exclusively on an Officer’s Certificate); and 

  
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 (c) transmit to Holders, in the manner and to the extent required by the Trust Indenture Act,
within 30 days after the filing thereof with the Trustee, such summaries of any information, documents and reports required to be filed by the Company pursuant to paragraphs 8.04(a) and 8.04(b) of this Section as may be required by rules and
regulations prescribed from time to time by the Commission. 
 ARTICLE 9 

CONSOLIDATION, MERGER, CONVEYANCE OR TRANSFER 

Section 9.01. Company May Consolidate, Etc., Only on Certain Terms. 

The Company may, without the consent of Holders of any Contingent Convertible Preferred Securities of any series Outstanding under this
Contingent Convertible Preferred Securities Indenture, consolidate or amalgamate with or merge into any other Person or Persons (whether or not affiliated with the Company) or sell, convey or transfer or lease its properties and assets as an
entirety or substantially as an entirety to any Person (whether or not affiliated with the Company), provided that: 
 (a) any Person
formed by any consolidation, amalgamation or merger, or any transferee or lessee of the Company’s assets shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee,
all obligations of the Company under this Contingent Convertible Preferred Securities Indenture; 
 (b) immediately after giving effect to
such consolidation, amalgamation, merger, conveyance, transfer or lease, no Enforcement Event and no event which, after notice or lapse of time or both, would become an Enforcement Event, shall have occurred and be continuing; 

(c) the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such
consolidation, amalgamation, merger, conveyance, transfer or lease and such supplemental indenture comply with this Article and that all conditions precedent herein provided for relating to such transaction have been complied with; and 

(d) immediately prior to such assumption, the successor entity shall have ratings for long-term senior debt assigned by Standard &
Poor’s Ratings Services or Moody’s Investors Service, Inc. (or their respective successors) which are the same as, or higher than, the credit rating for long-term senior debt of the Company (or, if applicable, the previous successor
entity) assigned by Standard & Poor’s Ratings Services or Moody’s Investors Service, Inc. (or their respective successors). 

Section 9.02. Successor Corporation Substituted. In the event of any merger, consolidation, amalgamation, conveyance, transfer or
lease permitted by Section 9.01 above, Additional Amounts under the Contingent Convertible Preferred Securities of a series will thereafter be payable in respect of taxes imposed by the successor corporation’s (as defined below)
jurisdiction of incorporation or tax residence (subject to exceptions equivalent to those that apply to the obligation to pay Additional Amounts pursuant to Section 11.04 in respect of taxes imposed in the Kingdom of Spain) rather than taxes
imposed by the Kingdom of Spain. Additional Amounts with respect to payments of Distributions due prior to the date of such merger, consolidation, amalgamation, conveyance, transfer or lease will be payable only in respect of taxes imposed by the
Kingdom of Spain.  
 The successor corporation will also be entitled to redeem the Contingent Convertible Preferred Securities in
the circumstances described in, and in accordance with, Section 12.09, except that if such successor corporation is not incorporated or tax resident in the Kingdom of Spain (i) references to Spain or the Kingdom of Spain in the definition
of “Tax Event” shall be deemed to refer to the successor corporation’s jurisdiction of incorporation or tax residence, and (ii) the change in, or amendment to, the laws or regulations of such jurisdiction of incorporation or tax
residence or of any political subdivision thereof or any authority or agency therein or thereof having power to tax, or the change in the application or binding official interpretation or administration of any such laws or regulations giving rise to
a Tax Event shall become effective subsequent to the date of any merger, consolidation, amalgamation, conveyance, transfer or lease permitted by Section 9.01. 

  
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 In the event of assumption of the Company’s obligations in connection with a merger,
consolidation, amalgamation, conveyance, transfer or lease of substantially all of its assets, the Company shall be released from all obligations and covenants under this Contingent Convertible Preferred Securities Indenture or the Contingent
Convertible Preferred Securities, as the case may be, and the acquiring or resulting successor corporation (the “successor corporation”) formed by such consolidation or amalgamation or into which the Company is merged or to which
such conveyance, transfer or lease is made shall succeed to and be substituted for, and may exercise every right and power of, the Company under this Contingent Convertible Preferred Securities Indenture with the same effect as if such successor
corporation had been named as the Company. 
 Section 9.03. Assumption of Obligations. Any holding company of the Company or any
wholly-owned subsidiary of the Company (the “successor entity”) may without the consent of the Holders of the Contingent Convertible Preferred Securities of any series, assume the obligations of the Company (or of any Person
which shall have previously assumed the obligations of the Company) under the Contingent Convertible Preferred Securities of such series, provided that: 

(a) the successor entity shall expressly assume such obligations by an amendment to the Contingent Convertible Preferred Securities Indenture,
executed by the Company and such successor entity, if applicable, and delivered to the Trustee, in form satisfactory to the Trustee; 
 (b)
immediately after giving effect to such assumption of obligations, no Enforcement Event and no event which, after notice or lapse of time or both, would become an Enforcement Event, shall have occurred and be continuing; and 

(c) the Company shall have delivered to the Trustee an Officer’s Certificate and an Opinion of Counsel, each stating that such assumption
complies with this Article 9 and that all conditions precedent herein provided for relating to such assumption have been complied with. 

Upon any such assumption, the successor entity shall succeed to, and be substituted for, and may exercise every right and power of, the
Company under this Contingent Convertible Preferred Securities Indenture with respect to any such Contingent Convertible Preferred Securities with the same effect as if such successor entity had been named as the Company in this Contingent
Convertible Preferred Securities Indenture, and the Company or any legal and valid successor entity which shall theretofore have become such in the manner prescribed herein, shall be released from all liability as obligor upon any such Contingent
Convertible Preferred Securities. 
 In the event of any assumption, Additional Amounts under the Contingent Convertible Preferred
Securities of a series will thereafter be payable in respect of taxes imposed by the successor entity’s jurisdiction of incorporation or tax residence (subject to exceptions equivalent to those that apply to the obligation to pay Additional
Amounts pursuant to Section 11.04 in respect of taxes imposed in the Kingdom of Spain) rather than taxes imposed by the Kingdom of Spain. Additional Amounts with respect to payments of Distributions due prior to the date of such assumption will
be payable only in respect of taxes imposed by the Kingdom of Spain. 
 The successor entity will also be entitled to redeem the Contingent
Convertible Preferred Securities in the circumstances described in, and in accordance with, Section 12.09, except that if such successor entity is not incorporated or tax resident in the Kingdom of Spain (i) references to Spain or the
Kingdom of Spain in the definition of “Tax Event” shall be deemed to refer to the successor entity’s jurisdiction of incorporation or tax residence, and (ii) the change in, or amendment to, the laws or regulations of such
jurisdiction of incorporation or tax residence or of any political subdivision thereof or any authority or agency therein or thereof having power to tax, or the change in the application or binding official interpretation or administration of any
such laws or regulations giving rise to a Tax Event shall become effective subsequent to the date of such assumption. 
 ARTICLE 10 

SUPPLEMENTAL INDENTURES 

Section 10.01. Supplemental Indenture without Consent of Holders. Without the consent of any Holders, the Company and the Trustee,
at any time and from time to time, may enter into one or more indentures supplemental hereto, in form satisfactory to the Trustee, for any of the following purposes: 

  
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 (a) to evidence the assumption by a successor Person of the covenants of the Company herein and
in the Contingent Convertible Preferred Securities of any series; 
 (b) to add to the covenants of the Company for the benefit of the
Holders of all or any series of Contingent Convertible Preferred Securities (and, if such covenants are to be for the benefit of less than all series of Contingent Convertible Preferred Securities, stating that such covenants are expressly being
included solely for the benefit of such series) or to surrender any right or power herein conferred upon the Company; 
 (c) to add any
additional Enforcement Events; 
 (d) to make changes to procedures relating to Conversion, delivery of the Common Shares, or ADSs, as
applicable; provided, however, that, unless such changes are made as a result of any change in, or amendment to, any relevant laws or regulations, no such change shall adversely affect the interests of the Holders of Contingent Convertible
Preferred Securities of any series in any material respect; 
 (e) to add to, change or eliminate any of the provisions of this Contingent
Convertible Preferred Securities Indenture, or any supplemental indenture, provided, however, that any such addition, change or elimination shall become effective only when there is no Outstanding Contingent Convertible Preferred Security of
any series created prior to the execution of such supplemental indenture effecting such addition, change or elimination which would be adversely affected by such addition, change or elimination and in respect of which such supplemental indenture
would apply; 
 (f) to establish the form or terms of Contingent Convertible Preferred Securities of any series as permitted under Sections
2.01 or 3.01 and 10.01(e); 
 (g) to change any Place of Payment, so long as the Place of Payment as required by Section 3.01 (if any)
is maintained; 
 (h) to cure any ambiguity or to correct or supplement any provision herein which may be defective or inconsistent with any
other provision herein or in any supplemental indenture; 
 (i) to vary, substitute or change specified terms of any series of Contingent
Convertible Preferred Securities subject to the conditions set forth under Section 3.01, provided such action shall not adversely affect the interests of the Holders of Contingent Convertible Preferred Securities of any series in any material
respect; 
 (j) to evidence and provide for the acceptance of appointment hereunder by a successor Trustee with respect to the Contingent
Convertible Preferred Securities of one or more series and to add to or change any of the provisions of this Contingent Convertible Preferred Securities Indenture as shall be necessary to provide for or facilitate the administration of the trusts
hereunder by more than one Trustee, pursuant to the requirements of Section 7.12(b); 
 (k) to change or eliminate any provision of this
Contingent Convertible Preferred Securities Indenture as permitted by Section 1.08; 
 (l) to name a Trustee for a particular series of
Contingent Convertible Preferred Securities other than the Trustee named in the first paragraph of this Contingent Convertible Preferred Securities Indenture and to provide for the appropriate changes related to such appointment for a particular
series of Contingent Convertible Preferred Securities; 
 (m) to delete, amend or supplement any provision contained herein or in any
supplemental indenture as a result of, and to the extent required by, the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority; 

(n) to delete, amend or supplement any provision contained herein or in any supplemental indenture as a result of, and to the extent required
by, Applicable Banking Regulations; 

  
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 (o) with respect to any Contingent Convertible Preferred Security (including a Global Security)
issued on or after the date hereof, to amend any such Contingent Convertible Preferred Security to conform to the description of the terms of such Contingent Convertible Preferred Security in the prospectus, prospectus supplement, product
supplement, pricing supplement or any other similar offering document related to the offering of such Contingent Convertible Preferred Security; or 

(p) to change or modify any provision of the Contingent Convertible Preferred Securities Indenture as necessary to ensure that the Contingent
Convertible Preferred Securities of any series shall be convertible into ordinary shares of Newco in the event of a Newco Scheme. 

Section 10.02. Supplemental Indentures with Consent of Holders. With the consent of the Holders of not less than a majority in
aggregate Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of each series affected by such supplemental Contingent Convertible Preferred Securities Indenture (voting as a class), by Act of said Holders delivered
to the Company and the Trustee, the Company and the Trustee may enter into an indenture or indentures supplemental hereto for the purpose of adding any provisions to or changing in any manner or eliminating any of the provisions of this
Contingent Convertible Preferred Securities Indenture or of modifying in any manner the rights of the Holders of Contingent Convertible Preferred Securities of such series under this Contingent Convertible Preferred Securities Indenture;
provided, however, that no such supplemental indenture may, without the consent of the Holder of each Outstanding Contingent Convertible Preferred Security affected thereby, 

(a) change the terms of any Contingent Convertible Preferred Security to reduce the Liquidation Preference (or premium, if any) payable upon
the redemption of, or the Distributions payable on any Contingent Convertible Preferred Security (without prejudice to the provisions of Article 3, including, without limitation, the right of the Company to cancel the payment of any Distributions on
any Contingent Convertible Preferred Securities), or change the obligation of the Company (or its successor) to pay Additional Amounts pursuant to Section 11.04 (except as permitted by Section 9.01(a), Section 9.03(a) and
Section 10.01(a)) on the Contingent Convertible Preferred Securities, or the currency in which payments under the Contingent Convertible Preferred Securities are to be made, or impair the right to institute suit for the enforcement of any such
payment when due and payable on or with respect to any Contingent Convertible Preferred Security, or modify the calculation of and any adjustment to, the Conversion Price; 

(b) reduce the percentage in aggregate Liquidation Preference of the Outstanding Contingent Convertible Preferred Securities of any series, the
consent of whose Holders is required for any such supplemental indenture, or the consent of whose Holders is required for any waiver (of compliance with certain provisions of this Contingent Convertible Preferred Securities Indenture or of certain
defaults hereunder and their consequences) provided for in this Contingent Convertible Preferred Securities Indenture or reduce the requirements for a quorum or voting; 

(c) modify any of the provisions of this Section 10.02 or Section 6.16 except to increase any such percentage or to provide that
certain other provisions of this Contingent Convertible Preferred Securities Indenture cannot be modified or waived without the consent of the Holder of each Outstanding Contingent Convertible Preferred Security affected thereby; or 

(d) change in any manner adverse to the interests of the Holders of any Contingent Convertible Preferred Securities the subordination
provisions of the Contingent Convertible Preferred Securities or the terms and conditions of the obligations of the Company in respect of the due and punctual payment of any amounts due and payable on the Contingent Convertible Preferred Securities,
except in each case with respect to any modification or amendment of the Contingent Convertible Preferred Securities Indenture pursuant to a supplemental indenture which is entered into as a result of, and to the extent required by, the exercise of
the Spanish Bail-in Power by the Relevant Spanish Resolution Authority or Applicable Banking Regulations, as the case may be (in which case neither the consent nor the affirmative vote of any Holder of an
Outstanding Contingent Convertible Preferred Security affected shall be required). 

  
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 It shall not be necessary for any Act of Holders under this Section to approve the particular
form of any proposed supplemental indenture, but it shall be sufficient if such Act shall approve the substance thereof. 
 A supplemental
indenture which changes or eliminates any covenant or other provision of this Contingent Convertible Preferred Securities Indenture which has expressly been entered into solely for the benefit of one or more particular series of Contingent
Convertible Preferred Securities, or which modifies the rights of the Holders of Contingent Convertible Preferred Securities of such series with respect to such covenant or other provision, shall be deemed not to affect the rights under this
Contingent Convertible Preferred Securities Indenture, or the interests, of the Holders of Contingent Convertible Preferred Securities of any other series. 

Section 10.03. Execution of Supplemental Indentures. In executing, or accepting the additional trusts created by, any supplemental
indenture permitted by this Article or the modifications thereby of the trusts created by this Contingent Convertible Preferred Securities Indenture, the Trustee shall be entitled to receive, and (subject to Section 7.01) shall be fully
protected in relying upon, an Opinion of Counsel stating that the execution of such supplemental indenture is authorized or permitted by this Contingent Convertible Preferred Securities Indenture and constitutes a legal, valid and binding obligation
of the Company, subject to customary exceptions. The Trustee may, but shall not be obliged to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties or immunities under this Contingent Convertible Preferred
Securities Indenture or otherwise. 
 Section 10.04. Effect of Supplemental Indentures. Upon the execution of any supplemental
indenture under this Article, this Contingent Convertible Preferred Securities Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Contingent Convertible Preferred Securities Indenture for
all purposes; and every Holder of a Contingent Convertible Preferred Security theretofore or thereafter authenticated and delivered hereunder shall be bound thereby, except as otherwise expressed therein. 

Section 10.05. Conformity with Trust Indenture Act. Every supplemental indenture executed pursuant to this Article shall conform
to the requirements of the Trust Indenture Act as then in effect. 
 Section 10.06. Reference in Contingent Convertible Preferred
Securities to Supplemental Indentures. Contingent Convertible Preferred Securities of any series authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee,
bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture. If the Company shall so determine, new Contingent Convertible Preferred Securities of any series so modified as to conform, in the opinion
of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and such Contingent Convertible Preferred Securities may be authenticated and delivered by the Trustee in exchange for Outstanding
Contingent Convertible Preferred Securities of such series. 
 ARTICLE 11 

COVENANTS 

Section 11.01. Payment of Liquidation Preference and Distributions. Except and to the extent as may be limited by the exercise of
the Spanish Bail-in Power by the Relevant Spanish Resolution Authority, the Company covenants and agrees for the benefit of each series of Contingent Convertible Preferred Securities that it will duly and
punctually pay, to the extent required by this Contingent Convertible Preferred Securities Indenture, the Liquidation Preference (and premium, if any) of and Distributions on, if any (subject to the subordination provisions of Section 13.01 and
Section 3.01) the Contingent Convertible Preferred Securities of that series when due and payable in accordance with the terms of the Contingent Convertible Preferred Securities and this Contingent Convertible Preferred Securities Indenture.
Except as otherwise specified, as contemplated by Section 3.01 hereof, the Trustee shall act as Principal Paying Agent with respect to any series of Contingent Convertible Preferred Securities. 

Section 11.02. Maintenance of Office or Agency. The Company will maintain in each Place of Payment for any series of Contingent
Convertible Preferred Securities an office or agency where Contingent Convertible Preferred Securities of that series may be presented or surrendered for payment, where Contingent Convertible Preferred Securities of that series may be surrendered
for registration of transfer or exchange and where notices and 

  
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demands to or upon the Company in respect of the Contingent Convertible Preferred Securities of that series and this Contingent Convertible Preferred Securities Indenture may be served;
provided, however, that at the option of the Company in the case of definitive Contingent Convertible Preferred Securities of such series, payment of any Distributions thereon may be made by check mailed to the address of the Person entitled
herein as such address shall appear in the Contingent Convertible Preferred Security Register. With respect to the Contingent Convertible Preferred Securities of any series, such office or agency in each Place of Payment shall be specified as
contemplated by Section 3.01, and if not so specified, initially shall be the principal corporate trust office of The Bank of New York Mellon in New York. Unless otherwise specified pursuant to Section 3.01, the Company will maintain in
the Borough of Manhattan, The City of New York, an office or agency where notices and demands to or upon the Company in respect of Contingent Convertible Preferred Securities of any series and this Contingent Convertible Preferred Securities
Indenture may be served. The Company will give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency. 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 principal corporate trust office of the Trustee in New York. The Company hereby initially appoints The Bank
of New York Mellon, located at 101 Barclay Street, New York, NY 10286, United States, as its agent to receive all presentations, surrenders, notices and demands. 

The Company may also from time to time designate one or more other offices or agencies (in or outside the Borough of Manhattan, The City of
New York) where the Contingent Convertible Preferred Securities of one or more series may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such
designation or rescission shall in any manner relieve the Company of any obligation to maintain an office or agency in each Place of Payment (except as otherwise indicated in this Section) for Contingent Convertible Preferred Securities of any
series for such purposes. The Company shall 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. 

Unless otherwise specified with respect to any Contingent Convertible Preferred Securities pursuant to Section 3.01, if and so long as
the Contingent Convertible Preferred Securities of any series (i) are denominated in a Foreign Currency or (ii) may be payable in a Foreign Currency, then the Company will maintain with respect to each such series of Contingent Convertible
Preferred Securities, or as so required, at least one exchange rate agent. 
 Section 11.03. Money for Payments to be Held in
Trust. If the Company shall at any time act as Paying Agent with respect to the Contingent Convertible Preferred Securities of any series, it shall, on or before each due date, if any, for payment of the Liquidation Preference (and premium, if
any) of, Distributions on or Additional Amounts with respect to, any of the Contingent Convertible Preferred Securities of that series, segregate and hold in trust for the benefit of the Persons entitled thereto a sum in the currency or currencies,
currency unit or units or composite currency or currencies in which the Contingent Convertible Preferred Securities of such series are payable (except as otherwise specified pursuant to Section 3.01 for the Contingent Convertible Preferred
Securities of such series) sufficient to pay the Liquidation Preference (and premium, if any), Distributions or Additional Amounts so becoming due until such sums shall be paid to such Persons or otherwise disposed of as herein provided and shall
promptly notify the Trustee of its action or failure so to act. 
 Whenever the Company shall have one or more Paying Agents for any series
of Contingent Convertible Preferred Securities, it shall prior to any due date for payment of the Liquidation Preference (and premium, if any) of, Distributions on or Additional Amounts with respect to, any Contingent Convertible Preferred
Securities of that series, deposit with any Paying Agent a sum (in the currency or currencies, currency unit or units or composite currency or currencies described in the preceding paragraph) sufficient to pay the Liquidation Preference (and
premium, if any), Distributions or Additional Amounts so becoming due, such sum to be held in trust for the benefit of the Persons entitled thereto, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its
action or its failure so to act. The obligation of the Company to pay any such Liquidation Preference (and premium, if any) of, Distributions on or Additional Amounts with respect to, any Contingent Convertible Preferred Securities of a series,
shall be satisfied upon the deposit referred to in this paragraph. Receipt of the relevant sum by the Paying Agent shall discharge the Company’s obligations in respect of the relevant payment. 

  
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 The Company will cause each Paying Agent for any series of Contingent Convertible Preferred
Securities (unless such Paying Agent is the Trustee) to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent shall: 

(a) hold all sums held by it for the payment of the Liquidation Preference (and premium, if any), Distributions on or Additional Amounts with
respect to Contingent Convertible Preferred Securities of that series in trust for the benefit of the Persons entitled thereto until such sums shall be paid to such Persons or otherwise disposed of as herein provided; 

(b) give the Trustee notice of any default by the Company (or any other obligor upon the Contingent Convertible Preferred Securities of that
series) in the making of any payment, when due and payable, of Liquidation Preference (and premium, if any), Distributions or Additional Amounts on Contingent Convertible Preferred Securities of that series; and 

(c) at any time during the continuance of any such default, upon the written request of the Trustee, forthwith pay to the Trustee all sums so
held in trust by such Paying Agent. 
 The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this
Contingent Convertible Preferred Securities Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by the Company or such Paying Agent, such sums to be held by the Trustee
upon the same terms as those upon which such sums were held by the Company or such Paying Agent; and, upon such payment by any Paying Agent to the Trustee such Paying Agent shall be released from all further liability with respect to such sums. 

Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the Liquidation Preference
(and premium, if any) of, Distributions on or any Additional Amounts with respect to any Contingent Convertible Preferred Security of any series and remaining unclaimed for two years after such Liquidation Preference (and premium, if any),
Distributions or Additional Amounts have become due and payable shall be paid to the Company on Company Request (or if then held by the Company shall be discharged from such trust); and the Holder of such Contingent Convertible Preferred Security
shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall
thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published at least once, in an Authorized Newspaper, notice that such
money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be paid to the Company. 

The Trustee and any Paying Agent promptly shall deliver or pay to the Company upon Company Request any excess money, as applicable, held by
them at any time with respect to any series of Contingent Convertible Preferred Securities. 
 Section 11.04. Additional
Amounts.  
 (a) Unless otherwise specified herein or unless otherwise specified as contemplated by Section 3.01, all
payments of Distributions payable in respect of Contingent Convertible Preferred Securities by the Company will be made free and clear of and without withholding or deduction for or on account of any present or future taxes, duties, assessments or
governmental charges (collectively “Taxes”) of whatever nature imposed or levied by or on behalf of Spain or any political subdivision thereof or any authority or agency therein or thereof having power to tax, unless the withholding
or deduction of such taxes, duties, assessments or governmental charges is required by law. In that event, the Company shall (to the extent such payment can be made out of Distributable Items of the Company on the same basis as for payment of any
Distribution in accordance with Article 3) pay, in respect of any withholding or deduction imposed on payments of Distributions only (and not Liquidation Preference (and premium, if any) or other amount), such additional amounts (“Additional
Amounts”) as will result in Holders of any series of Outstanding Contingent Convertible Preferred Securities receiving such amounts as they would have received in respect of such Distributions had no such withholding or deduction been
required. 

  
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 (b) The Company shall not be required to pay any Additional Amounts in relation to any payment in
respect of any Contingent Convertible Preferred Security: 
 (i) to, or to a third party on behalf of, a Holder if the Holder
or the beneficial owner of Contingent Convertible Preferred Securities of any series is liable for such Taxes in respect of such Contingent Convertible Preferred Security by reason of his having some connection with Spain other than the mere holding
of such Contingent Convertible Preferred Security; or 
 (ii) to, or to a third party on behalf of, a Holder if the Holder or
the beneficial owner of Contingent Convertible Preferred Securities fails to provide the Company or the Trustee or Paying Agent (as the Company may determine in connection with each series of Contingent Convertible Preferred Securities) acting on
behalf of the Company the information concerning such Holder or beneficial owner as may be required in order to comply with any procedures that may be implemented to comply with any interpretation of Royal Decree 1065/2007, as amended, made by the
Spanish Tax Authorities; or 
 (iii) to, or to a third party on behalf of, a Holder if the Holder or the beneficial owner of
Contingent Convertible Preferred Securities of any series failed to make any necessary claim or to comply with any certification, identification or other requirements concerning the nationality, residence, identity or connection with the taxing
jurisdiction of such Holder or beneficial owner, if such claim or compliance is required by statute, regulation or administrative practice of the taxing jurisdiction of the Company as a condition to relief or exemption from such taxes; or 

(iv) presented for payment (where presentation is required) more than 30 days after the Relevant Date, except to the extent
that the relevant Holder would have been entitled to such Additional Amounts on presenting the same for payment on the expiry of such period of 30 days; or 

(v) to, or to a third party on behalf of, individuals resident for tax purposes in the Kingdom of Spain; or 

(vi) to, or to a third party on behalf of, a Spanish-resident legal entity subject to Spanish corporation tax if the Spanish
tax authorities determine that the Contingent Convertible Preferred Securities of any series do not comply with exemption requirements specified in the Reply to a Consultation of the Directorate General for Taxation
(Dirección General de Tributos) dated July 27, 2004, and require a withholding to be made; or 

(vii) where the withholding or deduction is required pursuant to an agreement described in Section 1471(b) of the Code or
otherwise imposed pursuant to Sections 1471 through 1474 of the Code (“FATCA”), any regulations or agreements thereunder, any official interpretations thereof, any intergovernmental agreements with respect thereto (including the
intergovernmental agreement between the United States and Spain on the implementation of FATCA), or any law implementing an intergovernmental agreement or any regulations or official interpretations relating thereto. 

(c) In addition, Additional Amounts will not be payable with respect to any Taxes that are imposed in respect of any combination of the items
listed in (b)(i) through (b)(vii) set forth above. 
 (d) Additional Amounts will also not be paid with respect to any payment to a Holder
who is a fiduciary, a partnership, a limited liability company or person other than the sole beneficial owner of that payment, to the extent that payment would be required by the laws of Spain (or any political subdivision thereof) to be included in
the income, for tax purposes, of a beneficiary or settlor with respect to the fiduciary, a member of that partnership, an interest holder in that limited liability company or a beneficial owner who would not have been entitled to the Additional
Amounts had it been the Holder. 
 For the purposes of this Section 11.04, “Relevant Date” means, in respect of any
payment, the date on which such payment first becomes due and payable, except that, if the full amount of the moneys payable has not been duly received by the Principal Paying Agent on or prior to such due date, it means the date on which, the full
amount of such moneys having been so received and being available for payment to Holders, notice to that effect is duly given to the Holders in accordance with Section 1.06. 

  
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 Whenever in this Contingent Convertible Preferred Securities Indenture there is mentioned, in any
context, the payment of Distributions on, or in respect of, any Contingent Convertible Preferred Security of any series, such mention shall be deemed to include mention of the payment of Additional Amounts provided by the terms of such series
established hereby or pursuant hereto to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to such terms, and express mention of the payment of Additional Amounts (if applicable) in any
provision hereof shall not be construed as excluding Additional Amounts in those provisions hereof where such express mention is not made. 

Section 11.05. Corporate Existence. Subject to Article 9, the Company shall do or cause to be done all things necessary to
preserve and keep in full force and effect its corporate existence, provided, however, that the foregoing shall not obligate the Company to preserve any such right or franchise if the Company shall determine that the preservation thereof is
no longer desirable in the conduct of its business and that the loss thereof is not disadvantageous in any material respect to any Holder. 

Section 11.06. Statement as to Compliance. The Company will deliver to the Trustee, within 120 days after the end of each fiscal
year, a certificate in compliance with Section 314(a)(4) of the Trust Indenture Act. 
 ARTICLE 12 

REDEMPTION AND PURCHASE OF CONTINGENT CONVERTIBLE
PREFERRED SECURITIES 
 Section 12.01. Applicability of Article. Contingent Convertible Preferred
Securities of any series shall be redeemable (except as otherwise specified pursuant to Section 3.01 for Contingent Convertible Preferred Securities of any series) in accordance with this Article. Contingent Convertible Preferred Securities of
any series may not be redeemed except in accordance with provisions of the Applicable Banking Regulations. The Contingent Convertible Preferred Securities of any series shall not be redeemable at the option of the Holder thereof. Except as otherwise
specified pursuant to Section 3.01 for Contingent Convertible Preferred Securities of any series, the Contingent Convertible Preferred Securities of any series shall be redeemable in whole and not in part.  

Section 12.02. Election to Redeem; Notice to Trustee. The election of the Company to redeem any Contingent Convertible Preferred
Securities shall be evidenced by a Board Resolution or approved by a person authorized to make such election pursuant to a Board Resolution. Unless otherwise provided as contemplated by Section 3.01 with respect to any series of Contingent
Convertible Preferred Securities, the Company shall, at least 30 calendar days prior, but not more than 60 calendar days prior to the Redemption Date fixed by the Company (unless a shorter notice shall be satisfactory to the Trustee), notify the
Trustee of such Redemption Date and of the Liquidation Preference of Contingent Convertible Preferred Securities of such series to be redeemed (which shall not be less than all). 

Section 12.03. [Reserved] 

Section 12.04. Redemption Procedures; Notice of Redemption. 

(a) The decision to redeem the Contingent Convertible Preferred Securities of a series must be irrevocably notified by the Company to Holders
of the Contingent Convertible Preferred Securities of such series upon not less than 30 nor more than 60 calendar days’ notice prior to the relevant Redemption Date (unless a shorter period is specified in the Contingent Convertible Preferred
Securities to be redeemed) (i) through the filing of a relevant information (información relevante) announcement with the CNMV and its publication in accordance with the rules and regulations of any applicable stock
exchange or other relevant authority and (ii) in the manner and to the extent required by Section 1.06 (in which case, such notice may be given at the Company’s request by the Trustee in the name and at the expense of the Company,
provided the Company has requested the Trustee to so give notice in writing accompanied by a copy of the form of notice, and the Trustee shall give such notice by the fifth Business Day following its receipt of such request). 

  
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 Failure to give notice in the manner herein provided to the Holder of any Contingent Convertible
Preferred Securities designated for redemption, or any defect in the notice to any such Holder, shall not affect the validity of the proceedings for the redemption of any other Contingent Convertible Preferred Securities. 

(b) Any notice of redemption will state: the Redemption Date; the Redemption Price; that on the Redemption Date the Redemption Price will,
subject to the satisfaction of the conditions set forth in this Contingent Convertible Preferred Securities Indenture, become due and payable upon each Contingent Convertible Preferred Security being redeemed and that Distributions will cease to
accrue on or after that date; the place or places where the Contingent Convertible Preferred Securities are to be surrendered for payment of the Redemption Price; and the CUSIP, Common Code and/or ISIN number or numbers, if any, with respect to the
Contingent Convertible Preferred Securities being redeemed. 
 (c) If the Company gives notice of redemption of the Contingent Convertible
Preferred Securities of any series, then on or prior to the relevant Redemption Date, the Company will (except as provided in Section 12.04(f) and Section 12.06): 

(i) irrevocably deposit with the Principal Paying Agent funds (in the currency in which the Contingent Convertible Preferred
Securities to be redeemed are payable) sufficient to pay the Redemption Price; and 
 (ii) give the Principal Paying Agent
irrevocable instructions and authority to pay the Redemption Price to the Holders thereof. 
 (d) If the notice of redemption has been given
on any series of Contingent Convertible Preferred Securities, and the funds deposited and instructions and authority to pay given as required above, then on the date of such deposit: 

(i) Distributions on the Contingent Convertible Preferred Securities of such series shall cease to accrue (unless such deposit
is made prior to the Redemption Date, in which case Distributions on the Contingent Convertible Preferred Securities of such series shall cease to accrue on the Redemption Date); 

(ii) such Contingent Convertible Preferred Securities of such series will no longer be considered Outstanding (except as
provided in Section 12.04(f), if there is a Trigger Event prior to the Redemption Date, and Section 12.04(h), if the Relevant Spanish Resolution Authority exercises its Spanish Bail-in Power with
respect to such Contingent Convertible Preferred Securities prior to the payment of the Redemption Price to the Holders); and 

(iii) the Holders of Contingent Convertible Preferred Securities of such series will no longer have any rights as Holders
except the right to receive the Redemption Price (except as provided in Section 12.04(f) if there is a Trigger Event prior to the Redemption Date). 

(e) Subject to Section 12.04(f), if in connection with any series of Contingent Convertible Preferred Securities the Company improperly
withholds or refuses to pay the Redemption Price of the Contingent Convertible Preferred Securities of such series, Distributions will continue to accrue, subject as provided in Section 3.08 and Section 3.09, at the rate specified from
(and including) the Redemption Date to (but excluding) the date on which the Redemption Price is deposited with the Principal Paying Agent. 

(f) The Company may not give a notice of redemption pursuant to this Section 12.04 with respect to the Contingent Convertible Preferred
Securities of a series if a Trigger Event Notice has been given with respect to such series. If any notice of redemption of any series of Contingent Convertible Preferred Securities has been given pursuant to this Section 12.04 and a Trigger
Event with respect to such series occurs prior to the Redemption Date, 

  
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the relevant redemption notice shall be automatically rescinded and shall be of no force and effect, there shall be no redemption of the relevant Contingent Convertible Preferred Securities on
such Redemption Date and, instead, the Trigger Conversion of the Contingent Convertible Preferred Securities shall take place as provided under Article 4. 

(g) If a Capital Reduction Notice has been given with respect to the Contingent Convertible Preferred Securities of a series, the Company may
not give a notice of redemption pursuant to this Section 12.04 with respect to such series until the end of the Election Period. If a redemption notice is given by the Company after the end of the Election Period, unless otherwise provided as
contemplated by Section 3.01 with respect to the relevant series of Contingent Convertible Preferred Securities, the Company may redeem all (but not part) of the aggregate Liquidation Preference of Contingent Convertible Preferred Securities of
such series which remains outstanding following the Capital Reduction Conversion. If any notice of redemption of any series of Contingent Convertible Preferred Securities has been given pursuant to this Section 12.04 and a Capital Reduction
with respect to such series occurs prior to the Redemption Date, such Capital Reduction will be disregarded for all purposes of this Contingent Convertible Preferred Securities Indenture with respect to such series of Contingent Convertible
Preferred Securities and there shall be no conversion of such series of Contingent Convertible Preferred Securities pursuant to Section 4.02 and, instead, the redemption of the relevant Contingent Convertible Preferred Securities shall take
place as provided under this Article 12. Accordingly, the provisions of Section 4.02 shall not apply to such series of Contingent Convertible Preferred Securities with respect to any such Capital Reduction and Holders and beneficial owners of
such series of Contingent Convertible Preferred Securities shall be deemed to have irrevocably waived their rights under Article 418 of the Spanish Companies Act. 

(h) If the Company has elected to redeem the Contingent Convertible Preferred Securities of any series but, prior to the payment of the
Redemption Price to Holders, the Relevant Spanish Resolution Authority exercises its Spanish Bail-in Power with respect to such series of Contingent Convertible Preferred Securities, the relevant redemption
notice shall be automatically rescinded and shall be of no force and effect, there shall be no redemption and consequently no payment of the Redemption Price (and any other amounts payable in accordance with this Article 12) will be due and payable.

 Section 12.05. [Reserved.] 

Section 12.06. Contingent Convertible Preferred Securities Payable on Redemption Date. Notice of redemption having been given as
set forth in Section 12.04, and subject to Section 12.04(f), the Contingent Convertible Preferred Securities so to be redeemed shall, on the Redemption Date, become due and payable at the Redemption Price therein specified, and from and
after such date (unless the Company shall default in the payment of the Redemption Price as described in Section 12.04(e)) such Contingent Convertible Preferred Securities shall cease to accrue Distributions. Upon surrender of any such
Contingent Convertible Preferred Security for redemption in accordance with the notice of redemption, such Contingent Convertible Preferred Security shall be paid by the Company at the Redemption Price. Contingent Convertible Preferred Securities in
definitive form shall be presented for redemption to the Principal Paying Agent. 
 Section 12.07. [Reserved] 

Section 12.08. Optional Redemption. Subject to Sections 12.09 and 12.10 and unless otherwise provided as contemplated by
Section 3.01 with respect to the Contingent Convertible Preferred Securities of any series, any series of Contingent Convertible Preferred Securities shall not be redeemable prior to the fifth anniversary of the date of issuance of the relevant
Contingent Convertible Preferred Securities (or such other period as Applicable Banking Regulations may require). All, and not only some, of the Contingent Convertible Preferred Securities of any series may be redeemed at the option of the Company
at any time on or after the fifth anniversary of the date of issuance of such Contingent Convertible Preferred Securities at the Redemption Price, in accordance with Articles 77 and 78 of CRR, Article 29 of the Commission Delegated Regulation (EU)
No 241/2014 and/or any other Applicable Banking Regulations then in force. 
 Section 12.09. Optional Redemption Due To A Tax
Event. Unless otherwise provided as contemplated by Section 3.01 with respect to the Contingent Convertible Preferred Securities of any series, if, on or after the date of issuance of any series of Contingent Convertible Preferred
Securities, there is a Tax Event, the Contingent Convertible Preferred Securities of such series may be redeemed, in whole but not in part, at the option of the Company at any time at the Redemption Price, in accordance with Articles 77 and 78 of
CRR, Article 29 of the Commission Delegated Regulation (EU) No 241/2014 and/or any other Applicable Banking Regulations then in force. 

  
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 Prior to any notice of redemption of such Contingent Convertible Preferred Securities pursuant to
Section 12.04, the Company shall provide the Trustee with (i) an Officer’s Certificate of the Company stating that the Company is entitled to effect such redemption and setting forth in reasonable detail a statement of circumstances
showing that a Tax Event has occurred; and (ii) an Opinion of Counsel to the effect that a Tax Event has occurred. 

Section 12.10. Optional Redemption Due To A Capital Event. Unless otherwise provided as contemplated by Section 3.01 with
respect to the Contingent Convertible Preferred Securities of any series, if, on or after the issue date of the Contingent Convertible Preferred Securities of any series, there is a Capital Event, the Contingent Convertible Preferred Securities of
such series may be redeemed, in whole but not in part, at the option of the Company at any time at the Redemption Price, in accordance with Articles 77 and 78 of CRR, Article 29 of the Commission Delegated Regulation (EU) No 241/2014 and/or any
other Applicable Banking Regulations then in force. 
 Section 12.11. Purchases of Contingent Convertible Preferred Securities.
(a) Unless otherwise provided as contemplated by Section 3.01 with respect to the Contingent Convertible Preferred Securities of any series, the Company or any member of the Group may purchase or otherwise acquire any of the Outstanding
Contingent Convertible Preferred Securities of any series at any price in the open market or otherwise, in accordance with Articles 77 and 78 of CRR, Article 29 of the Commission Delegated Regulation (EU) No 241/2014 and/or any other Applicable
Banking Regulations in force at the relevant time. 
 (b) Notwithstanding any other provision of this Contingent Convertible Preferred
Securities Indenture and subject to compliance with the provisions of any applicable law (including the Spanish Companies Act and the Applicable Banking Regulations), the Company or any member of the Group may exercise such rights as it may from
time to time enjoy to purchase or redeem or buy back any shares of the Company (including Common Shares) or any depositary or other receipts or certificates representing the same without the consent of the Holders. 

Section 12.12. [Reserved] 

Section 12.13. Cancelled Distributions Not Payable Upon Redemption. Any Distributions that have been cancelled or deemed cancelled
pursuant to Sections 3.08 or 3.09 hereof shall not be payable if the Contingent Convertible Preferred Securities are redeemed pursuant to Sections 12.08, 12.09 or 12.10. 

ARTICLE 13 

SUBORDINATION OF CONTINGENT CONVERTIBLE PREFERRED
SECURITIES 
 Section 13.01. Subordination. (a) Unless previously converted into Common Shares pursuant to
Article 4, the obligations of the Company under the Contingent Convertible Preferred Securities of any series will constitute direct, unconditional, unsecured and subordinated obligations of the Company and, in case of insolvency (concurso de
acreedores) of the Company, in accordance with Additional Provision 14.3 of Law 11/2015 and the Spanish Insolvency Law but only to the extent permitted by the Spanish Insolvency Law or any other applicable laws relating to or affecting the
enforcement of creditors’ rights in Spain and subject to any other ranking that may apply as a result of any mandatory provision of law (or otherwise), for so long as the obligations of the Company in respect of the Contingent Convertible
Preferred Securities of such series constitute an Additional Tier 1 Instrument of the Company, such Contingent Convertible Preferred Securities will rank with respect to claims for any Liquidation Preference of such Contingent Convertible Preferred
Securities: 
 (i) junior to: 

(A) any unsubordinated obligations of the Company (including where those obligations subsequently become subordinated pursuant
to Article 92.1o of the Spanish Insolvency Law); and 

  
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 (B) any claim for principal in respect of any other contractually subordinated
obligations of the Company, present and future, not constituting Additional Tier 1 Capital of the Company for the purposes of Section 3.(a) of Additional Provision 14 of Law 11/2015 (other than, to the extent permitted by law, any Parity
Securities, whether so ranking by law or their terms); 
 (ii) pari passu with: 

(A) each other claim for any Liquidation Preference of Contingent Convertible Preferred Securities; 

(B) all other claims in respect of any liquidation preference or otherwise for principal in respect of contractually
subordinated obligations of the Company under any outstanding Additional Tier 1 Instruments, present and future; and 
 (C)
any other Parity Securities (whether so ranking by law or their terms), to the extent permitted by law; and 
 (iii) senior
to the Common Shares or any other subordinated obligations of the Company which by law rank junior to the Contingent Convertible Preferred Securities (including, to the extent permitted by law, any contractually subordinated obligations of the
Company expressed by their terms to rank junior to the Contingent Convertible Preferred Securities). 
 The obligations of the Company under
the Contingent Convertible Preferred Securities are subject to, and may be limited by, the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority. 

(b) The Company agrees with respect to any series of Contingent Convertible Preferred Securities and each Holder and beneficial owner of
Contingent Convertible Preferred Securities of any series, by his or her acquisition of a Contingent Convertible Preferred Security, will be deemed to have agreed to the subordination as described in this Section 13.01. To the extent permitted
by Spanish law, each such Holder and beneficial owner will be deemed to have irrevocably waived his or her rights of priority which would otherwise be accorded to him or her under the laws of Spain, to the extent necessary to effectuate the
subordination provisions of the Contingent Convertible Preferred Security. In addition, each Holder and beneficial owner of Contingent Convertible Preferred Securities of any series by his or her acquisition of the securities, to the extent
permitted by Spanish law, authorizes and directs the applicable trustee on his or her behalf to take such action as may be necessary or appropriate to effectuate the subordination of the relevant Contingent Convertible Preferred Securities as
provided in the Contingent Convertible Preferred Securities Indenture and as summarized herein and appoints the Trustee his attorney-in-fact for any and all such
purposes. 
 Section 13.02. Waiver of Right of Set-Off. Subject to applicable law,
neither any Holder or beneficial owner of the Contingent Convertible Preferred Securities of any series nor the Trustee acting on behalf of the Holders of the Contingent Convertible Preferred Securities of such series may exercise, claim or plead
any right of set-off, compensation or retention in respect of any amount owed to it by the Company in respect of, or arising under, or in connection with, the Contingent Convertible Preferred Securities of
such series or the Contingent Convertible Preferred Securities Indenture and each Holder and beneficial owner of the Contingent Convertible Preferred Securities of such series, by virtue of its holding of any Contingent Convertible Preferred
Securities of such series or any interest therein, and the Trustee acting on behalf of the Holders of the Contingent Convertible Preferred Securities of such series, shall be deemed to have waived all such rights of
set-off, compensation or retention. If, notwithstanding the above, any amounts due and payable to any Holder or beneficial owner of a Contingent Convertible Preferred Security of any series or any interest
therein by the Company in respect of, or arising under, the Contingent Convertible Preferred Securities of such series are discharged by set-off, such Holder or beneficial owner shall, subject to applicable
law, immediately pay an amount equal to the amount of such discharge to the Company (or, if a Liquidation Event shall have occurred, the liquidator or administrator of the Company, as the case may be) and, until such time as payment is made, shall
hold an amount equal to such amount in trust (where possible) or otherwise for the Company (or the liquidator or administrator of the Company, as the case may be) and, accordingly, any such discharge shall be deemed not to have taken place. 

  
 81 

 Section 13.03. [Reserved] 

Section 13.04. Trustee to Effectuate Subordination. Each Holder and beneficial owner of a Contingent Convertible Preferred
Security by his acceptance thereof, to the extent permitted by Spanish law, authorizes and directs the Trustee on his behalf to take such action as may be necessary or appropriate to effectuate the subordination of the Contingent Convertible
Preferred Securities provided in this Article 13 and appoints the Trustee his attorney-in-fact for any and all such purposes. 

Section 13.05. Trustee Not Fiduciary for Senior Creditors. With respect to the senior creditors, the Trustee undertakes to perform
or to observe only such of its covenants and obligations as are specifically set forth in this Contingent Convertible Preferred Securities Indenture, and no implied covenants or obligations with respect to the Senior Creditors shall be read into
this Contingent Convertible Preferred Securities Indenture against the Trustee. Unless otherwise provided in any applicable law, the Trustee shall not be deemed to owe any fiduciary duty to the Senior Creditors and shall not be liable to any such
holders if it shall in good faith mistakenly pay over or distribute to Holders of Contingent Convertible Preferred Securities of the series or to the Company or to any other Person cash, property or securities to which any Senior Creditors shall be
entitled by virtue of this Article or otherwise. 
 Section 13.06. Rights of Trustee as Senior Creditor; Preservation of
Trustee’s Rights. To the extent permitted by any applicable law, the Trustee in its individual capacity shall be entitled to all the rights set forth in this Article with respect to any claims of senior creditors which may at
any time be held by it, to the same extent as any other Senior Creditor, and nothing in this Contingent Convertible Preferred Securities Indenture or the Trust Indenture Act shall deprive the Trustee of any of its rights as such holder. 

Nothing in this Article shall apply to claims of, or payments to, the Trustee under or pursuant to Section 6.08 and Section 7.08.

 Section 13.07. Article Applicable to Paying Agents. At all times when a Paying Agent other than the Trustee shall have been
appointed by the Company and be then acting hereunder, the term “Trustee” as used in this Article shall in such case (unless the context otherwise requires) be construed as extending to and including such Paying Agent within its
meaning as fully for all intents and purposes as if such Paying Agent were named in this Article in addition to or in place of the Trustee; provided, however, that Section 13.06 shall not apply to the Company or any Affiliate of the
Company if it or such Affiliate acts as Paying Agent. 
 ARTICLE 14 

SPANISH BAIL-IN AND
RESOLUTION ACTIONS 
 Section 14.01. Agreement and Acknowledgment with Respect to the Exercise of the
Spanish Bail-in Power. 
 (a) Notwithstanding any other term of the Contingent Convertible
Preferred Securities of any series, the Contingent Convertible Preferred Securities Indenture or any other agreements, arrangements, or understandings between the Company and any Holder of the Contingent Convertible Preferred Securities of any
series, by its acquisition of the Contingent Convertible Preferred Securities of any series, each Holder (which, for the purposes of this Article 14, includes each holder of a beneficial interest in the Contingent Convertible Preferred Securities of
any series) acknowledges, accepts, consents to and agrees to be bound by: (i) the exercise and effect of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority, which may be imposed with
or without any prior notice with respect to the Contingent Convertible Preferred Securities of any series, and may include and result in any of the following, or some combination thereof: (A) the reduction or cancellation of all, or a portion,
of the Amounts Due on the Contingent Convertible Preferred Securities of any series; (B) the conversion of all, or a portion, of the Amounts Due on the Contingent Convertible Preferred Securities of any series into shares, other securities or
other obligations of the Company or another Person (and the issue to or conferral on the Holder of any such shares, securities or obligations), including by means of an amendment, modification or variation of the terms of the Contingent Convertible
Preferred Securities; (C) the cancellation of the Contingent Convertible Preferred Securities of any series; (D) the amendment or alteration of the maturity, if any, of the Contingent Convertible Preferred

  
 82 

 
Securities of any series or amendment of the Liquidation Preference or Distributions payable on the Contingent Convertible Preferred Securities of any series, or the date on which Distributions
become payable, including by suspending payment for a temporary period; and (ii) the variation of the terms of the Contingent Convertible Preferred Securities of any series or the rights of the Holders thereunder or under the Contingent
Convertible Preferred Securities Indenture, if necessary, to give effect to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority. 

(b) By its acquisition of the Contingent Convertible Preferred Securities of any series, each Holder acknowledges and agrees that neither a
reduction or cancellation, in part or in full, of the Amounts Due on the Contingent Convertible Preferred Securities of any series or the conversion thereof into another security or obligation of the Company or another Person, in each case as a
result of the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority with respect to the Company, nor the exercise of the Spanish Bail-in
Power by the Relevant Spanish Resolution Authority with respect to the Contingent Convertible Preferred Securities of a series shall: (i) give rise to a default or event of default for purposes of Section 315(b) (Notice of Defaults) and
Section 315(c) (Duties of the Trustee in Case of Default) of the Trust Indenture Act; or (ii) be a default or an Enforcement Event with respect to the Contingent Convertible Preferred Securities or under this Contingent Convertible
Preferred Securities Indenture. By its acquisition of the Contingent Convertible Preferred Securities of any series, each Holder further acknowledges and agrees that no repayment or payment of Amounts Due on the Contingent Convertible Preferred
Securities of any series shall become due and payable or be paid after the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority if, and to the extent that, such amounts have been
reduced, converted, cancelled, amended or altered as a result of such exercise. 
 (c) By its acquisition of the Contingent Convertible
Preferred Securities of any series, each Holder, to the extent permitted by the Trust Indenture Act, waives any and all claims, in law and/or in equity, against the Trustee for, agrees not to initiate a suit against the Trustee in respect of, and
agrees that the Trustee shall not be liable for, any action that the Trustee takes, or abstains from taking, in either case in accordance with the exercise of the Spanish Bail-in Power by the Relevant Spanish
Resolution Authority with respect to the Contingent Convertible Preferred Securities of such series. Additionally, by its acquisition of the Contingent Convertible Preferred Securities of any series, each Holder acknowledges and agrees that, upon
the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority with respect to the Contingent Convertible Preferred Securities of such series: (i) the Trustee shall not be required
to take any further directions from the Holders with respect to any portion of the Contingent Convertible Preferred Securities of such series that is written down, converted to equity and/or cancelled under Section 6.14 of this Contingent
Convertible Preferred Securities Indenture; and (ii) this Contingent Convertible Preferred Securities Indenture shall not impose any duties upon the Trustee whatsoever with respect to the exercise of the Spanish
Bail-in Power by the Relevant Spanish Resolution Authority; provided, however, that notwithstanding the exercise of the Spanish Bail-in Power by the Relevant
Spanish Resolution Authority with respect to the Contingent Convertible Preferred Securities of a series, so long as any Contingent Convertible Preferred Securities of such series remain outstanding, there shall at all times be a trustee for the
Contingent Convertible Preferred Securities of such series in accordance with the Contingent Convertible Preferred Securities Indenture, and the resignation and/or removal of the Trustee and the appointment of a successor trustee shall continue to
be governed by this Contingent Convertible Preferred Securities Indenture, including to the extent no additional supplemental indenture or amendment is agreed upon in the event the Contingent Convertible Preferred Securities of such series remain
outstanding following the completion of the exercise of the Spanish Bail-in Power. 
 (d) By its
acquisition of the Contingent Convertible Preferred Securities of any series, each Holder shall be deemed to have authorized, directed and requested the relevant Depositary, Clearing Systems and any direct participant in any relevant Clearing System
or other intermediary through which it holds such Contingent Convertible Preferred Securities to take any and all necessary action, if required, to implement the exercise of the Spanish Bail-in Power with
respect to the Contingent Convertible Preferred Securities as it may be imposed, without any further action or direction on the part of such Holder. 

(e) Upon the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority with
respect to the Contingent Convertible Preferred Securities of any series, the Company or the Relevant Spanish Resolution Authority (as the case may be) shall provide a written notice to the relevant Depositary as soon as practicable regarding such
exercise of the Spanish Bail-in Power for purposes of notifying the Holders of such Contingent Convertible Preferred Securities. The Company shall also deliver a copy of such notice to the Trustee for
information purposes. 

  
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 (f) If the Company has elected to redeem the Contingent Convertible Preferred Securities of any
series but, prior to the payment of the Redemption Price to Holders, the Relevant Spanish Resolution Authority exercises its Spanish Bail-in Power with respect to such series of Contingent Convertible
Preferred Securities, the relevant redemption notice shall be automatically rescinded and shall be of no force and effect, there shall be no redemption and consequently no payment of the Redemption Price (and any other amounts payable in accordance
with Article 12) will be due and payable. 
 (g) By its acquisition of the Contingent Convertible Preferred Securities of any series, each
Holder acknowledges, accepts, consents to and agrees to be bound by (i) the exercise and effect of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority, which may be imposed with or
without any prior notice, with respect to any Common Shares that may be delivered to it upon the Conversion (if any) of the Contingent Convertible Preferred Securities of any series, and (ii) the variation of the terms of such Common Shares to
give effect to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority. 

(h) Each Holder that acquires Contingent Convertible Preferred Securities of any series in the secondary market or otherwise shall be deemed to
acknowledge and agree to be bound by and consent to the same provisions specified in this Contingent Convertible Preferred Securities Indenture to the same extent as the Holders that acquire the Contingent Convertible Preferred Securities upon their
initial issuance, including, without limitation, with respect to this Article 14. 
 Section 14.02. BRRD Liabilities.
Notwithstanding and to the exclusion of any other term of this Contingent Convertible Preferred Securities Indenture or any other agreements, arrangements, or understandings between the Company and the Trustee, the Trustee acknowledges and
accepts that a BRRD Liability arising under this Contingent Convertible Preferred Securities Indenture may be subject to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority,
and acknowledges, accepts, and agrees to be bound by: 
 (a) the effect of the exercise of the Spanish
Bail-in Power by the Relevant Spanish Resolution Authority in relation to any BRRD Liability of the Company to the Trustee, which (without limitation) may include and result in any of the following, or some
combination thereof: 
 (i) the reduction of all, or a portion, of such BRRD Liability or outstanding amounts due thereon;

 (ii) the conversion of all, or a portion, of such BRRD Liability into shares, other securities or other obligations of the
Company or another Person, and the issue to or conferral on the Trustee of such shares, securities or obligations; 
 (iii)
the cancellation of such BRRD Liability; and/or 
 (iv) the amendment or alteration of any interest, if applicable, on such
BRRD Liability, and the maturity or the dates on which any payments on such BRRD Liability are due, including by suspending payment for a temporary period; and 

(b) the variation of the terms of this Contingent Convertible Preferred Securities Indenture, as deemed necessary by the Relevant Spanish
Resolution Authority, to give effect to the exercise of the Spanish Bail-in Power by the Relevant Spanish Resolution Authority. 

The terms of this section shall survive the payment in full of the Contingent Convertible Preferred Securities, the satisfaction and discharge
of this Contingent Convertible Preferred Securities Indenture with respect to any series of Contingent Convertible Preferred Securities, the resignation or removal of the Trustee and the termination for any reason of this Contingent Convertible
Preferred Securities Indenture. 

  
 84 

 This instrument 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. The exchange of copies of this Contingent Convertible Preferred Securities Indenture and of signature pages by facsimile or electronic
format (i.e., “pdf” or “tiff”) transmission shall constitute effective execution and delivery of this Contingent Convertible Preferred Securities Indenture as to the parties hereto and may be used in lieu of the original
Indenture for all purposes permitted under applicable law. 

  
 85 

 IN WITNESS WHEREOF, the Company and the Trustee have caused this Contingent Convertible Preferred
Securities Indenture to be duly executed, all as of the day and year first above written. 
  

			
	BANCO BILBAO VIZCAYA ARGENTARIA, S.A.
		
	By:	 	 /s/ Antonio Joaquín Borraz Peralta

		 	Name: Antonio Joaquín Borraz Peralta
		 	Title: Authorized Representative
	
	THE BANK OF NEW YORK MELLON, AS TRUSTEE, PAYING AND CONVERSION AGENT AND PRINCIPAL PAYING AGENT
		
	By:	 	 /s/ Maria Bertolin

		 	Name: Maria Bertolin
		 	Title: Authorized Signatory
	
	THE BANK OF NEW YORK MELLON, AS CONTINGENT CONVERTIBLE PREFERRED SECURITY REGISTRAR
		
	By:	 	 /s/ Maria Bertolin

		 	Name: Maria Bertolin
		 	Title: Authorized Signatory

 APPENDIX 1: PROCEDURES FOR COMPLIANCE WITH SPANISH TAX LEGISLATION 

Information Procedures and Certification Obligations of the Paying Agent in respect of payments under the Contingent Convertible Preferred
Securities 
 These procedures set forth the steps to be followed by the Company and the Paying Agent in respect of the Contingent
Convertible Preferred Securities of a series, pursuant to Section 7.02 of the Contingent Convertible Preferred Securities Indenture to which this Appendix 1 is appended. Terms used but not defined herein shall have the meanings assigned
to them in the Contingent Convertible Preferred Securities Indenture to which this Appendix 1 is appended. 
 “Payment
Amount” means (i) with respect to a Distribution Payment Date, the aggregate Distribution payable on such date, and (ii) with respect to a Redemption Date, the aggregate amount of the difference, if any, between the aggregate
Redemption Price of the Contingent Convertible Preferred Securities being redeemed on such date and the aggregate Liquidation Preference of such Contingent Convertible Preferred Securities provided that such difference corresponds to a Distribution
or a premium paid by the Company. 
 “Payment Date” means a Distribution Payment Date or a Redemption Date, as applicable.

 “Payment Statement” means the statement to be delivered to the Company by the Paying Agent, substantially in the form set
forth in Annex I to this Appendix 1, pursuant to Section 7.02 of the Contingent Convertible Preferred Securities Indenture. 
  

	(1)	In the case of a Redemption Date, no later than 5:00 p.m. New York time on the Business Day prior to such Redemption Date, the Company shall notify the Paying Agent of the Payment Amount. 

 

	(2)	On or before each Payment Date, the Company shall deposit with the Paying Agent an amount of funds sufficient to pay the applicable Payment Amount gross of Spanish withholding tax, in accordance with the Contingent
Convertible Preferred Securities Indenture, together with any other amounts to be deposited thereunder. 

  

	(3)	No later than 11:00 p.m. New York time on the business day immediately preceding the relevant Payment Date (“PD-1”), the Paying Agent shall deliver an executed
Payment Statement to the Company, which the Paying Agent shall reasonably believe to be duly completed, substantially in the form set forth in Annex I hereto, setting forth certain details relating to the Contingent Convertible Preferred Securities,
including the relevant Payment Date, the Payment Amount to be paid by the Company on such Payment Date, and the portion of the Payment Amount corresponding to each clearing agency located outside Spain (including DTC). 

 

	(4)	The Payment Statement shall be dated as of PD-1, shall set forth information as of the close of business of PD-1 and shall be executed
after the close of business of PD-1. 

  

	(5)	The Company shall review the Payment Statement submitted by the Paying Agent as soon as practicable. If the Company believes that the information contained in the Payment Statement is incomplete or inaccurate or that
the Payment Statement is otherwise not in compliance with the applicable regulation, it will notify the Paying Agent no later than 5:30 a.m., New York time, on the relevant Payment Date and state the reasons for such belief. Following such
notification, the Paying Agent shall deliver to the Company a further executed Payment Statement, revised, if necessary, as reasonably determined by the Paying Agent and which the Paying Agent shall reasonably believe to be duly completed, as soon
as practicable but in any event no later than 9:30 a.m. New York time on the relevant Payment Date (the “First Statement Deadline”).

Procedures applicable if the Paying Agent does not deliver a duly executed and completed Payment Statement to the Company by the First
Statement Deadline 
  

	(6)	 If the Paying Agent fails or for any reason is unable to deliver a duly executed and completed Payment Statement
to the Company by the First Statement Deadline, the Paying Agent undertakes to make all reasonable efforts to provide an executed Payment Statement to the Company which the Paying Agent shall

	 	
reasonably believe to be duly completed, as soon as practicable but no later than 9:00 a.m. New York time on the 10th calendar day of the month immediately following the relevant Payment Date (or
if such day is not a Business Day, the first Business Day immediately preceding such day). The Payment Statement shall be dated as of PD-1 and shall set forth information as of the close of business of PD-1. 

  

	(7)	The Company shall review the Payment Statement submitted by the Paying Agent as soon as practicable. If the Company believes that the information contained in the Payment Statement is incomplete or inaccurate or that
the Payment Statement is otherwise not in compliance with the applicable regulation, it will notify the Paying Agent no later than 11:00 a.m., New York time, on the 10th calendar day of the month immediately following the relevant Payment Date (or
if such day is not a Business Day, the first Business Day immediately preceding such day) and state the reasons for such belief. Following such notification, the Paying Agent shall deliver to the Company a further executed Payment Statement,
revised, if necessary, as reasonably determined by the Paying Agent and which the Paying Agent shall reasonably believe to be duly completed, as soon as practicable but in any event no later than 5:00 p.m. New York time on the 10th calendar day of
the month immediately following the relevant Payment Date (or if such day is not a Business Day, the first Business Day immediately preceding such day). 

Original copies 
  

	(8)	The Paying Agent must deliver an original copy of any duly executed and completed Payment Statement issued hereunder to the Company no later than the 15th calendar day of the month immediately following the relevant
Payment Date. 

 Notices, etc. 

Except as otherwise provided pursuant to Section 3.01 with respect to the Contingent Convertible Preferred Securities of a particular
series, any notice, statement or other paper, document or communication made or given by the Company to the Paying Agent pursuant to the procedures set forth in this Appendix 1 shall be sent by email or fax or communicated by telephone, as
follows (or as the Paying Agent shall have notified the Company in writing): c/o The Bank of New York Mellon, London Branch, One Canada Square, London E14 5AL, United Kingdom (Attention: Global Corporate Trust), telephone: +44 1202689787, fax: + 44
(0)20 7163 2536; email address: corpsov4@bnymellon.com. Any notice, statement or other paper, document or communication made or given by the Paying Agent to the Company pursuant to the procedures set forth in this Appendix 1, other than a
Payment Statement, shall be sent by email or fax or communicated by telephone, as follows (or as the Company shall have notified the Paying Agent in writing): Attention: Finance Department, telephone: +34 (91) 5377253 and +34 (91) 5378195, email
address: finance.deparment@bbva.com. Non-original copies of a Payment Statement shall be sent by email or fax to the Company. The original copy of a duly executed and completed Payment Statement shall
be sent by posted mail or courier to the Company, at the following address: Calle Azul 4, 28050 Madrid, Spain (Attention: Raúl Moreno and Cristina Cortadi). 

  
 2 

 Annex I 

FORM OF PAYMENT STATEMENT TO BE DELIVERED BY THE PAYING AGENT 

[English translation provided for informational purposes only] 

Modelo de declaración a que se refieren los apartados 3, 4 y 5 del artículo 44 del Reglamento General de las actuaciones y los
procedimientos de gestión e inspección tributaria y de desarrollo de las normas comunes de los procedimientos de aplicación de los tributos3 

Model declaration form referred to in paragraphs 3, 4 and 5 of section 44 of the General Regulations of conduct and procedures relating to tax administration
and inspection and the development of general rules of procedures for the enforcement of taxes 
 Don (nombre), con número de
identificación fiscal (1) (...), en nombre y representación de (entidad declarante), con número de identificación fiscal (1) (....) y domicilio en (...) en calidad de (marcar la letra que proceda): 

Mr. (name), with tax identification number (1) (...), in the name and on behalf of (declaring entity), with tax identification number (1) (...), with
domicile in (address) acting in its capacity as (check as appropriate) 
  

	(a)	Entidad Gestora del Mercado de Deuda Pública en Anotaciones 

  

	(a)	Managing Entity of the Public Debt Book-Entry Market 

  

	(b)	Entidad que gestiona el sistema de compensación y liquidación de valores con sede en el extranjero 

  

	(b)	Clearing and settlement entity located outside Spain 

  

	(c)	Otras entidades que mantienen valores por cuenta de terceros en entidades de compensación y liquidación de valores domiciliadas en territorio español 

 

	(c)	Other entities that hold securities on behalf of third parties in clearing and settlement systems domiciled in Spain 

  

	(d)	Agente de pagos designado por el emisor 

  

	(d)	Paying Agent appointed by the issuer 

 Formula la siguiente declaración, de acuerdo
con lo que consta en sus propios registros: 
 Files the following statement, in accordance with the information set forth in its own
records: 
  

	1.	En relación con los apartados 3 y 4 del artículo 44: 

  

	1.	Regarding sections 3 and 4 of section 44: 

  

	1.1	Identificación de los valores 

  

	1.1.	Identification of the securities 

  

	1.2	Fecha de pago de los rendimientos (o de reembolso si son valores emitidos al descuento o segregados) 

  

	1.2.	Date on which payment will be made (or reimbursement date in case of securities issued at a discount or segregated securities) 

  

 

	3 	The Paying Agent will only need to provide responses to the questions set forth in Section 2 of this form (i.e., questions 2.1 to 2.6). 

  
 3 

	1.3	Importe total de los rendimientos (o importe total a reembolsar, en todo caso, si son valores emitidos al descuento o segregados) 

 

	1.3	Total amount of payment (or total amount to be reimbursed, in any event, in case of securities issued at a discount or segregated securities) 

 

	1.4	Importe de los rendimientos correspondiente a contribuyentes del Impuesto sobre la Renta de las Personas Físicas, excepto cupones segregados y principales segregados en cuyo reembolso intervenga una Entidad
Gestora 

  

	1.4.	Amount of payment corresponding to Spanish Individual Income Tax taxpayers, except with respect to segregated coupons and segregated principal the payment of which is handled by a Managing Entity 

 

	1.5	Importe de los rendimientos que conforme al apartado 2 del artículo 44 debe abonarse por su importe íntegro (o importe total a reembolsar si son valores emitidos al descuento o segregados)

  

	1.5.	Amount of payment that, pursuant to section 2 of section 44, must be paid in full (or the total amount to be reimbursed in the case of securities issued at a discount or segregated securities) 

 

	2.	En relación con el apartado 5 del artículo 44: 

  

	2.	Regarding section 5 of section 44: 

  

	2.1	Identificación de los valores 

  

	2.1.	Identification of the securities 

  

	2.2	Fecha de pago de los rendimientos (o de reembolso si son valores emitidos al descuento o segregados) 

  

	2.2.	Date on which payment will be made (or reimbursement date in case of securities issued at a discount or segregated securities) 

  

	2.3	Importe total de los rendimientos (o importe total a reembolsar si son valores emitidos al descuento o segregados) 

  

	2.3	Total amount of payment4 (or total amount to be reimbursed, in any event, in case of securities issued at a discount or segregated securities) 

 

	2.4	Importe correspondiente a la entidad que gestiona el sistema de compensación y liquidación de valores con sede en el extranjero A 

 

	2.4.	Amount of payment2 corresponding to clearing and settlement entity “A”5 located outside Spain

  

	2.5	Importe correspondiente a la entidad que gestiona el sistema de compensación y liquidación de valores con sede en el extranjero B 

 

	2.5.	Amount of payment2 corresponding to clearing and settlement entity “B”4 located outside Spain

  

	2.6	Importe correspondiente a la entidad que gestiona el sistema de compensación y liquidación de valores con sede en el extranjero C 

 

	4 	Refers to: (i) with respect to a Distribution Payment Date, the aggregate Distribution payable on such date, and (ii) with respect to a Redemption Date, the aggregate amount of the difference between the
Redemption Price and the Liquidation Preference of the Securities being redeemed on such date provided that such difference corresponds to a Distribution or a premium paid by the Company. 

	5 	References to A, B and C, respectively, shall be replaced by the complete name of the relevant foreign clearing and settlement entity (such as The Depository Trust Company). If there is a single foreign clearing and
settlement entity, only question 2.4 need be completed. 

  
 4 

	2.6.	Amount of payment2 corresponding to clearing and settlement entity “C”4 located outside Spain6 

 Lo que declaro en ......................a .... de ......................de
.... 
 I declare the above in [location] on the [day] of [month] of [year]. 

Name:                    , on behalf of The Bank of New
York Mellon, as Paying Agent with respect to the securities. 
  

	(1)	En caso de personas, físicas o jurídicas, no residentes sin establecimiento permanente se hará constar el número o código de identificación que corresponda de conformidad con su
país de residencia. 

  

	(1)	In case of individuals or corporations that are not resident in Spain and do not act through a permanent establishment in Spain, please include the identification number or code that corresponds in accordance with the
laws of their country of residence. 

  
  

	6 	To be complemented as appropriate if the relevant payment is made through more than three different clearing and settlement entities outside Spain. 

  
 5

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