Document:

Exhibit 4.2

 

EXECUTION VERSION

AVERY DENNISON CORPORATION,

 

as Issuer

 

AND

 

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,

 

as Trustee

 

 

FOURTH SUPPLEMENTAL INDENTURE

 

Dated as of March 3, 2017

 

To

 

INDENTURE

 

Dated as of November 20, 2007

 

 

1.250% Senior Notes due 2025

 

 

FOURTH SUPPLEMENTAL INDENTURE (as hereinafter defined, the “Fourth Supplemental Indenture”), dated as of March 3, 2017, between AVERY DENNISON CORPORATION, a Delaware corporation (the “Company”), and THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., a national banking association, as Trustee (the “Trustee”).

 

WHEREAS, the Company and the Trustee executed and delivered an Indenture, dated as of November 20, 2007 (the “Base Indenture” and, together with the Fourth Supplemental Indenture, the “Indenture”), to provide for the issuance by the Company of unsecured debentures, notes, bonds or other evidences of indebtedness in an unlimited amount to be issued from time to time in one or more series as provided in the Base Indenture;

 

WHEREAS, pursuant to a Board Resolution, dated April 28, 2016, the Company authorized the creation and issuance of a series of its debt securities under the Indenture, designated as the “1.250% Senior Notes due 2025” in the initial aggregate principal amount of €500,000,000 (the “Notes”);

 

WHEREAS, Section 14.01 of the Base Indenture provides that the Company, when authorized by a Board Resolution, and the Trustee, from time to time and at any time, may enter into one or more supplemental indentures to establish the forms and terms of Securities as permitted in Section 3.01 of the Base Indenture;

 

WHEREAS, the Company desires to establish the form and terms of the Notes in accordance with Sections 2.01 and 3.01 of the Base Indenture;

 

WHEREAS, the Company has determined that this Fourth Supplemental Indenture is authorized and permitted by Section 14.01 of the Base Indenture and has delivered to the Trustee an Opinion of Counsel to that effect and an Officer’s Certificate pursuant to Section 3.03 of the Base Indenture to the effect that all conditions precedent provided for in the Base Indenture to the Trustee’s execution and delivery of this Fourth Supplemental Indenture have been complied with;

 

WHEREAS, the Indenture is subject to the provisions of the Trust Indenture Act that are required to be part of the Indenture and shall, to the extent applicable, be governed by such provisions; and

 

WHEREAS, all things necessary to make this Fourth Supplemental Indenture a valid agreement of the Company, in accordance with its terms, and to make the Notes, when executed by the Company and authenticated and delivered by the Trustee, the valid obligations of the Company, have been performed, and the execution and delivery of this Fourth Supplemental Indenture has been duly authorized in all respects.

 

NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

 

ARTICLE 1

 

DEFINITIONS

 

Section 1.1            Definition of Terms.  For all purposes of this Fourth Supplemental Indenture, except as otherwise expressly provided or unless the context requires otherwise:

 

(a)           a term defined in the Base Indenture and not otherwise defined herein has the same meaning when used in this Fourth Supplemental Indenture; and

 

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(b)           the following terms have the meanings given to them in this Section 1.1(b) and shall have the meaning set forth below for purposes of this Fourth Supplemental Indenture and the Base Indenture as it relates to the Notes created hereby:

 

“Additional Notes” shall have the meaning set forth in Section 6.1 hereof.

 

“Attributable Debt” means, as to any particular lease under which any Person is at the time liable and at any date as of which the amount thereof is to be determined, the total net amount of rent required to be paid by such Person under such lease during the remaining primary term thereof, discounted from the respective due dates to such date at the actual percentage rate inherent in such arrangement as the Company has determined in good faith. The net amount of rent required to be paid under any such lease for any such period shall be the aggregate amount of the rent payable by the lessee with respect to such period after excluding amounts required to be paid on account of maintenance and repairs, insurance, taxes, assessments, water rates and similar charges. In the case of any lease which is terminable by the lessee upon the payment of a penalty, such net amount shall also include the amount of such penalty, but no rent shall be considered as required to be paid under such lease subsequent to the first date upon which it may be so terminated.

 

“business day” means any day other than a Saturday or Sunday, (i) which is not a day on which banking institutions in the City of New York or London are authorized or required by law, regulation or executive order to close and, (ii) in the event that any payment by the Company of the principal of, premium, if any, interest and additional amounts, if any, on the Notes is to be made in Euro, on which the Trans-European Automated Real-Time Gross Settlement Express Transfer system (the TARGET2 system), or any successor thereto, is open.

 

“Change of Control” means the occurrence of any of the following:

 

(a)           the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or more series of related transactions, of all or substantially all of the Company’s assets and the Company’s Subsidiaries’ assets, taken as a whole, to any person, other than the Company or one of the Company’s Subsidiaries;

 

(b)           the consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any person becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the Company’s outstanding Voting Stock or other Voting Stock into which the Company’s Voting Stock is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares; or

 

(c)           the adoption of a plan relating to the Company’s liquidation or dissolution.

 

Notwithstanding the foregoing, a transaction will not be deemed to involve a Change of Control if (a) the Company becomes a direct or indirect wholly-owned Subsidiary of a holding company and (b)(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 the Company’s’ Voting Stock immediately prior to that transaction or (2) immediately following that transaction no person (other than a holding company satisfying the requirements of this sentence) is the beneficial owner, directly or indirectly, of more than 50% of the Voting Stock of such holding company. The term “person,” as used in this definition, has the meaning given thereto in Section 13(d)(3) of the Exchange Act.

 

“Change of Control Offer” shall have the meaning set forth in Section 3.2 hereof.

 

“Change of Control Payment” shall have the meaning set forth in Section 3.2 hereof.

 

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“Change of Control Payment Date” shall have the meaning set forth in Section 3.2 hereof.

 

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Rating Event.

 

“Comparable Government Bond” means, in relation to any Comparable Government Bond Rate calculation a German government bond (Bundesanleihe) whose maturity is closest to the maturity of the Notes, or if an independent investment bank selected by the Company in its discretion determines that such similar bond is not in issue, such other German government bond as such independent investment bank may, with the advice of three brokers of, and/or market makers in, German government bonds selected by such independent investment bank, determine to be appropriate for determining the Comparable Government Bond Rate.

 

“Comparable Government Bond Rate” means, with respect to any Redemption Date, the price, expressed as a percentage (rounded to three decimal places, with 0.0005 being rounded upwards), at which the gross redemption yield on the Notes, if they were to be purchased at such price on the third business day prior to the date fixed for redemption, would be equal to the gross redemption yield on such business day of the Comparable Government Bond on the basis of the middle market price of the Comparable Government Bond prevailing at 11:00 a.m. (London time) on such business day as determined by an independent investment bank selected by the Company.

 

“Consolidated Net Tangible Assets” means the aggregate amount of assets (less applicable reserves and other properly deductible items) less (i) all liabilities, other than deferred income taxes and Funded Debt, and (ii) goodwill, trade names, trademarks, patents, organizational expenses and other like intangibles owned by the Company as well as the Company’s consolidated Subsidiaries and computed in accordance with generally accepted accounting principles.

 

“Debt” means debt issued, assumed or guaranteed by the Company or a Subsidiary for money borrowed.

 

“Funded Debt” means (i) all indebtedness for money borrowed having a maturity of more than 12 months from the date as of which the determination is made or having a maturity of 12 months or less but by its terms being renewable or extendible beyond 12 months from such date at the option of the borrower and (ii) rental obligations payable more than 12 months from such date under leases which are capitalized in accordance with generally accepted accounting principles (such rental obligations to be included as Funded Debt at the amount so capitalized and to be included for the purposes of the definition of Consolidated Net Tangible Assets both as an asset and as Funded Debt at the amount so capitalized).

 

“Holder” means the Person in whose name a Registered Security is registered in the Register.

 

“Interest Period” shall have the meaning set forth in Section 2.3(b) hereof.

 

“Investment Grade” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, and the equivalent Investment Grade credit rating from any replacement Rating Agency or Rating Agencies selected by us.

 

“Lien” means any lien, mortgage or pledge.

 

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

 

“Optional Redemption Price” shall have the meaning set forth in Section 3.1(a) hereof.

 

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“Principal Property” means any real property the Company or any Subsidiaries own or hereafter acquire (including related land and improvements thereon and all machinery and equipment included therein without deduction of any depreciation reserves) of which on the date as of which the determination is being made exceeds 2% of Consolidated Net Tangible Assets other than (i) any property which in the Company’s determination is not of material importance to the total business conducted by the Company and its Subsidiaries as an entirety or (ii) any portion of a particular property which is similarly found not to be of material importance to the use or operation of such property.

 

“Prospectus Supplement” means the prospectus supplement relating to the Notes dated February 24, 2017 and filed by the Company with the SEC on February 27, 2017.

 

“Rating Agencies” means (a) each of Moody’s and S&P; and (b) if either Moody’s or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” within the meaning of Section 3(a)(62) of the Exchange Act selected by the Company (as certified by a resolution of the Company’s Board of Directors) as a replacement agency for Moody’s or S&P, or each of them, as the case may be.

 

“Rating Event” means the rating on the Notes is lowered by each of the Rating Agencies and the Notes are rated below Investment Grade by each of the Rating Agencies on any day within the 60-day period (which 60-day 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) after the earlier of (1) the occurrence of a Change of Control and (2) public notice of the occurrence of a Change of Control or our intention to effect a Change of Control; provided, however, that a Rating Event otherwise arising by virtue of a particular reduction in rating will not be deemed to have occurred in respect of a particular Change of Control (and thus will not be deemed a Rating Event for purposes of the definition of Change of Control Triggering Event) if the Rating Agencies making the reduction in rating to which this definition would otherwise apply do not announce or publicly confirm or inform the Company in writing that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control has occurred at the time of the Rating Event).

 

“Regular Record Date” means, with respect to any Interest Payment Date, the February 16 (whether or not a business day) preceding the relevant Interest Payment Date.

 

“Remaining Scheduled Payments” means the remaining scheduled payments of the principal and interest on the Notes to be redeemed that would be due after the related Redemption Date but for such redemption; provided, however, that if such Redemption Date is not an Interest Payment Date, the amount of the next scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to, but not including, such Redemption Date.

 

“S&P” means S&P Global Ratings, and its successors.

 

“Voting Stock” means, with respect to any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date, the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.

 

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ARTICLE 2

 

GENERAL TERMS AND CONDITIONS OF THE NOTES

 

Section 2.1            Designation and Principal Amount.  The Notes may be issued from time to time upon written order of the Company for the authentication and delivery of the Notes pursuant to Sections 3.01 and 3.03 of the Base Indenture.  There is hereby authorized a series of Securities designated as the “1.250% Senior Notes due 2025,” initially limited in aggregate principal amount to €500,000,000 (except upon registration of transfer of, or in exchange for, or in lieu of, other Notes pursuant to Sections 3.03, 3.04, 3.06, 4.06, 14.05 of the Base Indenture).

 

Section 2.2            Stated Maturity.  The date upon which the Notes shall become due and payable at final maturity, together with any accrued and unpaid interest, shall be March 3, 2025.

 

Section 2.3            Interest.

 

(a)           The Notes shall bear interest at the rate of 1.250% per annum.  The date from which interest shall accrue on the Notes shall be March 3, 2017.  Interest on the Notes shall be payable annually in arrears on March 3 of each year, beginning on March 3, 2018 to the Persons in whose name the respective Notes are registered at the close of business on the Regular Record Date for such Interest Payment Date, except as provided in Section 2.3(d) hereof.

 

(b)           Interest payable on any Interest Payment Date, the Stated Maturity or, if applicable, any Redemption Date or otherwise at Maturity shall be the amount of interest accrued from, and including, the immediately preceding Interest Payment Date in respect of which interest has been paid or duly provided for (or from and including the original issue date of March 3, 2017, if no interest has been paid or duly provided for with respect to the Notes) to, but excluding, such Interest Payment Date, Stated Maturity or, if applicable, Redemption Date or other Maturity, as the case may be (each, an “Interest Period”).

 

(c)           Interest on the Notes will be computed on the basis of the actual number of days in the Interest Period.  This payment convention is referred to as ACTUAL/ACTUAL (ICMA) as defined in the rulebook of the International Capital Market Association.  In the event that any scheduled Interest Payment Date for the Notes falls on a day that is not a business day, then payment of interest payable on such Interest Payment Date shall be postponed to the next succeeding day which is a business day (and no interest on such payment shall accrue for the period from and after such scheduled Interest Payment Date).

 

(d)           In the event that the Stated Maturity, any Redemption Date or other Maturity falls on a day that is not a business day, then the related payments of principal, premium, if any, and interest may be made on the next succeeding day that is a business day (and no additional interest shall accumulate on the amount payable for the period from and after the Stated Maturity or any Redemption Date or other Maturity).  Interest due on the Stated Maturity or any Redemption Date or other Maturity (in each case, whether or not an Interest Payment Date) on any of the Notes shall be paid to the Person to whom principal of the Notes is payable.

 

Section 2.4            Place of Payment and Appointment.  Principal of, premium, if any, interest and additional amounts, if any, on the Notes shall be payable at the office or agency of the Company maintained for such purpose in London, England, which shall initially be a corporate trust office or agency of the Paying Agent in London, England; provided, however, that payment of interest may be made at the option of the Company by check mailed to the Person entitled thereto at such address as shall appear in the Security Register or by wire transfer to an account appropriately designated by the Person entitled to payment; and provided, further, the Company shall pay principal of, premium, if any, interest and additional amounts, if any, on the Notes in global form registered in the name of or held by The Bank of New York Depository (Nominees) Limited, or such other Depositary as any officer of the Company may from time to time designate, or its respective nominee, by wire in immediately available funds to such Depositary or its nominee, as the case may be, as the Holder of such Notes in global form. The transfer of the Notes shall be registrable and the Notes shall be exchangeable for Notes of a like aggregate 

 

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principal amount at the office or agency of the Company maintained for such purpose in New York, New York, which shall initially be a corporate trust office of the Trustee or its affiliate.

 

The transfer agent and Security Registrar for the Notes shall initially be the Trustee.  The Paying Agent for the Notes shall initially be The Bank of New York Mellon, London Branch pursuant to a Paying Agency Agreement, dated as of March 3, 2017, between the Company and The Bank of New York Mellon, London Branch.

 

Section 2.5            Defeasance.  The Company may elect, at its option at any time, to have Article XII of the Base Indenture apply to the Notes, except that, with respect to the Notes, Section 12.03(c) of the Base Indenture is replaced with the following: The Company shall have delivered to the Trustee an Opinion of Counsel to the effect that holders and beneficial owners of the Securities of such series will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the Company’s exercise of its option under this Section and will be subject to U.S. federal income tax on the same amounts and in the same manner and at the same times as would have been the case if such action had not been exercised and, in the case of the Securities of such series being Discharged, such Opinion of Counsel shall be based on either a change in applicable U.S. federal income tax law since the date of the Indenture or a ruling received by the Company from, or that is published by, the U.S. Internal Revenue Service.

 

Section 2.6            Denominations.  The Notes shall be issuable only in minimum denominations of €100,000 and integral multiples of €1,000 in excess thereof.

 

Section 2.7            Global Securities.  The Notes shall be issued initially by one or more registered notes in global form (“global notes”), but in certain limited circumstances may be represented by notes in the form of a permanent Global Security in registered form deposited with or for the account of The Bank of New York Mellon, London Branch, or such other Depositary as any officer of the Company may from time to time designate.  The Notes shall be registered in the name of the nominee of such Depositary, for, and in respect of interests held through, Euroclear Bank S.A./N.V. (“Euroclear”) and Clearstream Banking, société anonyme (“Clearstream”).  Unless and until each such Global Security is exchanged for Notes in certificated form, the Global Security may be transferred, in whole but not in part, only to a Depositary for Euroclear or Clearstream or their nominee.

 

If the applicable Depositary is at any time unwilling or unable to continue as Depositary for any of the global notes and a successor Depositary is not appointed by the Company within 90 days, or if the Company has been notified that both Clearstream and Euroclear have been closed for business for a continuous period of 14 days (other than by reason of holiday, statutory or otherwise) or have announced an intention permanently to cease business or have in fact done so and no successor clearing system is available, the Company will issue the Notes in definitive registered form in exchange for the applicable global notes. The Company will also issue the Notes in definitive registered form in exchange for the global notes if an Event of Default has occurred with regard to the Notes represented by the global notes and has not been cured or waived.

 

The Company may at any time and in its sole discretion determine not to have the Notes represented by the global notes and, in that event, will issue the Notes in definitive registered form in exchange for the global notes. In any such instance, an owner of a beneficial interest in the global notes will be entitled to physical delivery in definitive registered form of the Notes represented by the global notes equal in principal amount to such beneficial interest and to have such notes registered in its name. The Notes so issued in definitive form will be issued as registered in minimum denominations of €100,000 and integral multiples of €1,000 thereafter, unless otherwise specified by the Company. The Notes in definitive form can be transferred by presentation for registration to the registrar at the Company’s office or agency for such purpose and must be duly endorsed by the holder or his attorney duly authorized in writing, or accompanied by a written instrument or instruments of transfer in form

 

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satisfactory to us or the registrar duly executed by the holder or his attorney duly authorized in writing. The Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer of definitive notes.

 

Section 2.8            Form of the Notes.  The form of the Notes and the Trustee’s Certificate of Authentication to be endorsed thereon shall be substantially in the form attached as Exhibit A hereto, with such changes therein as the officers of the Company executing the Notes (by manual or facsimile signature) may approve, such approval to be conclusively evidenced by their execution thereof.

 

Section 2.9            No Sinking Fund.  The Notes shall not be entitled to the benefit of any sinking fund.

 

Section 2.10          Unavailability of Euros.  If the Euro is unavailable to the Company due to the imposition of exchange controls or other circumstances beyond the Company’s control or if the Euro is no longer being used by the then member states of the European Monetary Union that have previously adopted the Euro as their currency or for the settlement of transactions by public institutions of or within the international banking community, then all payments in respect of the Notes will be made in U.S. Dollars until the Euro is again available to the Company or so used.  The amount payable on any date in Euros will be converted to U.S. Dollars at the rate mandated by the U.S. Federal Reserve Board as of the close of business on the second business day prior to the relevant payment date or, in the event the U.S. Federal Reserve Board has not mandated a rate of conversion, on the basis of the most recent U.S. Dollar/Euro exchange rate published in The Wall Street Journal on or prior to the second business day prior to the relevant payment date, or in the event The Wall Street Journal has not published such exchange rate, such rate as determined in our sole discretion on the basis of the most recently available market exchange rate for the Euro.  Neither the Trustee nor the Paying Agent shall have any responsibility for monitoring exchange rates or effecting conversions.

 

Section 2.11          Additional Amounts.

 

(a)           All payments of principal and interest in respect of the Notes will be made free and clear of, and without deduction or withholding for or on account of, any present or future taxes, duties, assessments or other governmental charges of whatsoever nature required to be deducted or withheld by the United States or any political subdivision or taxing authority of or in the United States, unless such withholding or deduction is required by law or the official interpretation or administration thereof.

 

(b)           In the event any withholding or deduction on payments in respect of the Notes for or on account of any present or future tax, assessment or other governmental charge is required to be deducted or withheld by the United States or any political subdivision or taxing authority thereof or therein, the Company will pay such additional amounts on the Notes as will result in receipt by each Holder of a Note that is not a U.S. Person (as defined below) of such amounts (after all such withholding or deduction, including on any additional amounts) as would have been received by such Holder had no such withholding or deduction been required.  The Company will not be required, however, to make any payment of additional amounts for or on account of:

 

(i)            any tax, assessment or other governmental charge that would not have been imposed but for (A) the existence of any present or former connection (other than a connection arising solely from the ownership of those Notes or the receipt of payments in respect of those Notes) between a Holder of a Note (or the beneficial owner for whose benefit such Holder holds such Note), or between a fiduciary, settlor, beneficiary of, member or shareholder of, or possessor of a power over, that Holder or beneficial owner (if that Holder or beneficial owner is an estate, trust, partnership or corporation) and the United States, including that Holder or beneficial owner, or that fiduciary, settlor, beneficiary, member, shareholder or possessor, being or having been a

 

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citizen or resident or treated as a resident of the United States or being or having been engaged in a trade or business or present in the United States or having had a permanent establishment in the United States or (B) the presentation of a Note for payment on a date more than 30 days after the later of the date on which that payment becomes due and payable and the date on which payment is duly provided for;

 

(ii)           any estate, inheritance, gift, sales, transfer, capital gains, excise, personal property, wealth or similar tax, assessment or other governmental charge;

 

(iii)          any tax, assessment, or other governmental charge imposed by reason of the Holder’s or beneficial owner’s past or present status as a passive foreign investment company, a controlled foreign corporation, a foreign tax exempt organization or a personal holding company with respect to the United States or as a corporation that accumulates earnings to avoid U.S. federal income tax;

 

(iv)          any tax, assessment or other governmental charge which is payable otherwise than by withholding or deducting from payment of principal of or premium, if any, or interest on such Notes;

 

(v)           any tax, assessment or other governmental charge required to be withheld by any paying agent from any payment of principal of and premium, if any, or interest on any Note if that payment can be made without withholding by at least one other paying agent;

 

(vi)          any tax, assessment or other governmental charge which would not have been imposed but for the failure of a beneficial owner or any Holder of Notes to comply with a request to satisfy certification, information, documentation or other reporting requirements concerning the nationality, residence, identity or connections with the United States of the beneficial owner or any Holder of the Notes (including, but not limited to, the requirement to provide Internal Revenue Service Forms W-8BEN, W-8BEN-E, W-8ECI, or any subsequent versions thereof or successor thereto, and including, without limitation, any documentation requirement under an applicable income tax treaty), provided such beneficial owner or Holder is legally able to so comply and compliance is a precondition to exemption from such tax, assessment or other governmental charge;

 

(vii)         any tax, assessment or other governmental charge imposed on interest received by or on behalf of (A) a 10-percent shareholder (as defined in Section 871(h)(3)(B) of the U.S. Internal Revenue Code of 1986, as amended (the “Code”), and the regulations that may be promulgated thereunder) of the Company, (B) a controlled foreign corporation that is related to the Company within the meaning of Section 864(d)(4) of the Code, or (C) a bank receiving interest described in Section 881(c)(3)(A) of the Code, to the extent such tax, assessment or other governmental charge would not have been imposed but for the Holder’s or beneficial owner’s status as described in clauses (A) through (C) of this Section 2.11(b)(vii);

 

(viii)        any tax, assessment or other governmental charge required to be withheld or deducted under Sections 1471 through 1474 of the Code (or any amended or successor version of such Sections that is substantively comparable) (“FATCA”), any regulations or other guidance thereunder, or any agreement (including any intergovernmental agreement) entered into in connection therewith; or any law, regulation or other official guidance enacted in any jurisdiction implementing FATCA or an intergovernmental agreement in respect of FATCA; or

 

(ix)          any combination of items (i) through (viii) of this Section 2.11(b);

 

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nor will the Company  pay any additional amounts any Holder that is not the sole beneficial owner of such Notes, or a portion of such Notes, or that is  a fiduciary or partnership or a limited liability company, to the extent that a beneficiary or settlor with respect to that fiduciary or a member of that partnership or limited liability company or a beneficial owner thereof would not have been entitled to the payment of those additional amounts had that beneficiary, settlor, member or beneficial owner been the Holder of those Notes.

 

(c)           The Notes are subject in all cases to any tax, fiscal or other law or regulation or administrative or judicial interpretation applicable to the Notes. Except as specifically provided under this Section 2.11, the Company will not be required to make any payment for any tax, assessment or other governmental charge imposed by any government or a political subdivision or taxing authority of or in any government or political subdivision.

 

(d)           As used in this Section 2.11 and in Section 3.3 hereof, the term “United States” means the United States of America, the states of the United States, and the District of Columbia, and the term “U.S. Person” means any individual who is a citizen or resident of the United States for U.S. federal income tax purposes, a corporation, partnership or other entity created or organized in or under the laws of the United States, any state of the United States or the District of Columbia (other than a partnership that is not treated as a United States person under any applicable U.S. Treasury regulations), or any estate or trust the income of which is subject to United States federal income taxation regardless of its source.

 

(e)           Any reference in the terms of the Notes to any amounts in respect of the Notes shall be deemed also to refer to any additional amounts which may be payable under this Section 2.11.

 

ARTICLE 3

 

REDEMPTION OF THE NOTES

 

Section 3.1            Optional Redemption by Company.

 

(a)           Subject to the terms of the Indenture, the Notes shall be redeemable in whole or in part, at the Company’s option, at any time and from time to time at a redemption price (the “Optional Redemption Price”) equal to the greater of:

 

(i)            100% of the principal amount of the Notes to be redeemed; and

 

(ii)           the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date, not including any portion of any payments of interest accrued to the Redemption Date, on an annual basis (ACTUAL/ACTUAL (ICMA)) at the applicable Comparable Government Bond Rate, plus 25 basis points, plus accrued and unpaid interest thereon to, but not including, the Redemption Date; provided, however, that if the Company redeems any Notes on or after December 3, 2024 (the date falling three months prior to the Stated Maturity), the redemption price for the Notes will be equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon to, but not including, the Redemption Date.

 

(b)           Notice of any redemption shall be transmitted not less than 30 days and not more than 60 days prior to the Redemption Date to each Holder of Notes to be redeemed.  In connection with any redemption of Notes, any such redemption may, at the Company’s discretion, be subject to one or more conditions precedent.  In addition, if such redemption or notice is subject to satisfaction of one or more conditions precedent, such notice shall state that, in the Company’s discretion, the Redemption Date may be delayed until such time as any or all such conditions shall be satisfied (or waived by the Company in

 

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its sole discretion), 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 (or waived by the Company in its sole discretion) by the Redemption Date (whether the original Redemption Date or the Redemption Date so delayed).  In addition, the Company may provide in such notice that payment of the Optional Redemption Price and performance of the Company’s obligations with respect to such redemption may be performed by another person.

 

(c)           Unless the Company defaults in payment of the Optional Redemption Price, from and after the Redemption Date, interest shall cease to accrue on the Notes or portions thereof called for redemption. If less than all of the Notes are to be redeemed, the Notes to be redeemed shall be selected by lot and may provide for the selection for redemption of a portion of the principal amount of Notes held by a Holder equal to an authorized denomination. If the Company redeems less than all of the Notes and the Notes are then held in book-entry form, the redemption will be made in accordance with the Depositary’s customary procedures.

 

Section 3.2            Change of Control Triggering Event.

 

(a)           If a Change of Control Triggering Event occurs, unless the Company has exercised its option to redeem the Notes as described in Section 3.1 hereof, the Company shall be required to make an offer (a “Change of Control Offer”) to each Holder of the Notes to repurchase all or any part (equal to €100,000 or an integral multiple of €1,000 in excess thereof) of that Holder’s Notes on the terms set forth in the Notes. In a Change of Control Offer, the Company shall be required to offer payment in cash equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest, if any, on the Notes repurchased to, but not including, the repurchase date (a “Change of Control Payment”). Within 30 days following any Change of Control Triggering Event or, at the Company’s option, prior to any Change of Control, but after public announcement of the transaction that constitutes or may constitute the Change of Control, a notice shall be mailed to Holders of the Notes describing the transaction that constitutes or may constitute the Change of Control Triggering Event and offering to repurchase such Notes on the repurchase date specified in the applicable notice, which date shall be no earlier than 30 days and no later than 60 days from the date on which such notice is mailed (a “Change of Control Payment Date”).

 

(b)           The notice shall, if mailed prior to the date of consummation of the Change of Control, state that the Change of Control Offer is conditioned on the Change of Control Triggering Event occurring prior to or on the applicable Change of Control Payment Date specified in the notice.

 

(c)           On any applicable Change of Control Payment Date, the Company shall, to the extent lawful:

 

(i)            accept for payment all Notes or portions of Notes properly tendered pursuant to the applicable Change of Control Offer;

 

(ii)           deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered pursuant to the applicable Change of Control Offer; and

 

(iii)          deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officer’s Certificate stating the aggregate principal amount of Notes or portions of Notes being repurchased.

 

(d)           The Company shall not be required to make a Change of Control Offer upon the occurrence of a Change of Control Triggering Event if a third party makes such an offer in the manner, at

 

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the times and otherwise in compliance with the requirements for an offer made by the Company, and the third party repurchases all Notes properly tendered and not withdrawn under its offer. In addition, the Company shall not repurchase any Notes if there has occurred and is continuing on the Change of Control Payment Date an Event of Default under the Indenture, other than a default in the payment of the Change of Control Payment upon a Change of Control Triggering Event.

 

The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Triggering Event. To the extent that the provisions of any such securities laws or regulations conflict with the Change of Control Offer provisions of the Notes, the Company shall comply with those securities laws and regulations and shall not be deemed to have breached the Company’s obligations under the Change of Control Offer provisions of the Notes by virtue of any such conflict.

 

Section 3.3            Tax Redemption.  If, as a result of any change in, or amendment to, the laws (or any regulations or rulings promulgated under the laws) of the United States (or any political subdivision of or taxing authority in the United States), or any change in, or amendment to, an official position regarding the application or interpretation of such laws, regulations or rulings, which change or amendment is announced or becomes effective on or after the date of this Indenture, the Company becomes or, based upon a written opinion of independent counsel selected by the Company, there is a substantial probability that the Company will become, obligated to pay additional amounts pursuant to Section 2.11 with respect to the Notes, then the Company  may at any time at its option redeem, in whole, but not in part, the Notes on not less than 30 nor more than 60 days’ prior notice, at a redemption price equal to 100% of their principal amount, together with accrued and unpaid interest on the Notes to, but not including, the Redemption Date.

 

ARTICLE 4

 

COVENANTS

 

Section 4.1            Restriction on Secured Debt.  The Company will not, nor will it permit any of its Subsidiaries to, incur, issue, assume or guarantee any Debt secured by a Lien on any of its or any Subsidiary’s Principal Property, or on any share of capital stock or Debt of any Subsidiary, unless the Company secures or causes such Subsidiary to secure the Notes equally and ratably with (or, at the Company’s option, prior to) such secured Debt, for so long as such secured Debt is so secured; provided, however, that the foregoing restrictions will not apply to Debt secured by the following:

 

(a)           any Lien existing on the date of this Indenture;

 

(b)           Liens on property of, or on any shares of capital stock of or Debt of, any Person existing at the time such Person is merged with or into or consolidated with the Company or any Subsidiary or otherwise becomes a Subsidiary;

 

(c)           Liens in the Company’s favor or in favor of any Subsidiary;

 

(d)           Liens in favor of governmental bodies to secure progress, advance or other payments pursuant to any contract or provision of any statute;

 

(e)           Liens on property existing at the time of acquisition thereof by the Company or any Subsidiary;

 

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(f)            any Lien securing indebtedness incurred to finance the purchase price or cost of construction of property (or additions, substantial repairs, alterations or substantial improvements thereto), provided that such Lien and the indebtedness secured thereby are incurred within twelve months of the later of acquisition or completion of construction (or addition, repair, alteration or improvement) and full operation thereof;

 

(g)           Liens securing industrial revenue bonds, pollution control bonds or similar types of bonds;

 

(h)           mechanics and similar Liens arising in the ordinary course of business in respect of obligations not due or being contested in good faith;

 

(i)            Liens arising from deposits with, or the giving of any form of security to, any governmental agency required as a condition to the transaction of business or exercise of any privilege, franchise or license;

 

(j)            Liens for taxes, assessments or governmental charges or levies which are not then delinquent or are being contested in good faith;

 

(k)           Liens put on any property in contemplation of its disposition, provided the Company has a binding agreement to sell at the time the Lien is imposed and the Company disposes of the property within one year after the creation of the Liens and that any indebtedness secured by the Liens is without recourse to the Company or any of its Subsidiaries;

 

(l)            Liens (including judgment liens) arising from legal proceedings being contested in good faith (and, in the case of judgment liens, execution thereof is stayed); and

 

(m)          any amendment, extension, renewal or replacement of any Liens referred to in the foregoing clauses (a) through (l) inclusive or any Debt secured thereby, provided that such extension, renewal or replacement shall be limited to all or part of the same property, shares of capital stock or Debt that secured the Lien extended, renewed or replaced.

 

Notwithstanding the foregoing, the Company and its Subsidiaries may issue, assume or guarantee Debt secured by a Lien which would otherwise be subject to the restrictions described above, provided that the aggregate amount of all such secured Debt, together with all the Company’s and its Subsidiaries’ Attributable Debt with respect to sale and leaseback transactions involving Principal Properties (with the exception of such transactions which are excluded as described in clauses (a) through (e) of Section 4.2), may not exceed 15% of Consolidated Net Tangible Assets.

 

Section 4.2            Restriction on Sale and Leaseback Transactions.  The Company will not, nor will it permit any of its Subsidiaries to, enter into any arrangement with any Person (other than the Company or a Subsidiary), or to which any such Person is a party, providing for the leasing to the Company or a Subsidiary of any Principal Property that has been or is to be sold or transferred by the Company or such Subsidiary to such Person or to any other Person (other than the Company or a Subsidiary), to which the funds have been or are to be advanced by such Person on the security of the leased property (a “sale and leaseback transaction”) involving any Principal Property, provided, however, the Company or any of its Subsidiaries may enter into a sale and leaseback transaction if any of the following occurs:

 

(a)           the lease is for a period, including renewal rights, of not in excess of three years;

 

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(b)           the sale or transfer of the Principal Property is made at the time of, or within 360 days after, the later of its acquisition or completion of construction;

 

(c)           the lease secures or relates to industrial revenue bonds, pollution control bonds or other similar types of bonds;

 

(d)           the transaction is between the Company and a Subsidiary or between Subsidiaries;

 

(e)           the Company or a Subsidiary, within 360 days after the Company or a Subsidiary makes a sale or transfer, applies an amount equal to the greater of the net proceeds of the sale of the Principal Property leased pursuant to such arrangement or the fair market value of the Principal Property so leased at the time of entering into such arrangement (as determined in any manner approved by the board of directors) to:

 

(i)            the retirement of the Notes or the Company’s other Funded Debt ranking on a parity with or senior to the Notes, or the retirement of the securities or other Funded Debt of a Subsidiary; provided, however, that the amount to be applied to the retirement of the Company’s Funded Debt or a Subsidiary’s Funded Debt shall be reduced by (x) the principal amount of any Notes (or other notes or debentures constituting such Funded Debt) delivered within such 360-day period to the Trustee for retirement and cancellation and (y) the principal amount of such Funded Debt, other than items referred to in the preceding clause (x), voluntarily retired by the Company or a Subsidiary within 360 days after such sale; and provided further, that notwithstanding the foregoing, no retirement referred to in this subclause (i) may be effected by payment at maturity or pursuant to any mandatory sinking fund payment or any mandatory prepayment provision, or

 

(ii)           the purchase of other property which shall constitute a Principal Property having a fair market value, in the Company’s determination, at least equal to the fair market value of the Principal Property leased in such sale and leaseback transaction; or

 

(f)            after giving effect to the transaction, the aggregate amount of all Attributable Debt with respect to such transactions plus all Debt secured by Liens on Principal Properties, or on shares of capital stock or Debt of Subsidiaries (with the exception of secured Debt which is excluded as described in Section 4.1), would not exceed 15% of Consolidated Net Tangible Assets.

 

Section 4.3            Existence.  Except as otherwise permitted by Section 6.04 of the Base Indenture, the Company shall do or cause to be done all things necessary to preserve and keep in full force and effect its existence as a corporation or other Person.

 

ARTICLE 5

 

EVENTS OF DEFAULT

 

Section 5.1            Events of Default. The following “Events of Default” shall apply with respect to the Notes (notwithstanding Section 7.01 of the Base Indenture, which shall be deemed amended and restated, and superseded, by the following):

 

“Event of Default” means, with respect to the Notes, any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law, pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

 

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(1)           default in any payment of interest on the Notes when due and payable and the default continues for a period of 30 days;

 

(2)           default in the payment of principal of, and premium, if any, on the Notes when due and payable at Maturity, upon required repurchase, upon acceleration, by call for redemption or otherwise;

 

(3)           the failure of the Company for 90 days (or 120 days in the case of a breach of Section 10.02 of the Base Indenture) to comply with any of its other agreements contained in this Indenture or the Notes after written notice of such Default from the Trustee or Holders of at least 25% in principal amount of the Notes then Outstanding has been received by the Company;

 

(4)           the Company fails to pay at maturity or the acceleration of any of its or its Subsidiaries’ indebtedness, other than non-recourse indebtedness, at any one time in an amount in excess of $100 million, if the indebtedness is not discharged or the acceleration is not annulled within 30 days after written notice to the Company by the Trustee or the Holders of at least 25% in principal amount of the Outstanding Notes;

 

(5)           the entry by a court having jurisdiction in the premises of (A) a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law or (B) a decree or order adjudging the Company bankrupt or insolvent, or approving as properly filed a petition seeking reorganization, arrangement, adjustment or composition of or in respect of the Company under any applicable federal or state law, or appointing a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or ordering the winding-up or liquidation of its affairs, and the continuance of any such decree or order for relief or any such other decree or order unstayed and in effect for a period of 90 consecutive days; or

 

(6)           the commencement by the Company of a voluntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law or of any other case or proceeding to be adjudicated bankrupt or insolvent, or the consent by either the Company to the entry of a decree or order for relief in respect of the Company in an involuntary case or proceeding under any applicable federal or state bankruptcy, insolvency, reorganization or other similar law or to the commencement of any bankruptcy or insolvency case or proceeding against the Company, or the filing by the Company of a petition or answer or consent seeking reorganization or relief under any applicable federal or state law, or the consent by the Company to the filing of such petition or to the appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee, sequestrator or other similar official of the Company or of any substantial part of its property, or the making by the Company of an assignment for the benefit of creditors, or the admission by the Company in writing of its inability to pay its debts generally as they become due, or the authorization of any such action by the Board of Directors of the Company.

 

Section 5.2            Acceleration of Maturity Upon Certain Events of Default.  The following provision shall apply with respect to the Notes (notwithstanding Section 7.02(a) of the Base Indenture, which shall be deemed amended and restated, and superseded, by the following):

 

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If any one or more of the above-described Events of Default shall happen (other than an Event of Default specified in Sections 5.1(5) or (6) above) with respect to the Notes at the time Outstanding, then, and in each and every such case, during the continuance of any such Event of Default, the Trustee or the Holders of 25% or more in principal amount of the Notes then Outstanding may (and upon the written request of the Holders of a majority in principal amount of such Notes then Outstanding, the Trustee shall) declare the principal of and all accrued but unpaid interest on all the Notes then Outstanding, if not then due and payable, to be due and payable, and upon any such declaration the same shall become and be immediately due and payable, anything in this Indenture or in Notes contained to the contrary notwithstanding. If an Event of Default specified in Sections 5.1(5) or (6) above occurs, then the principal of and all accrued but unpaid interest on all the Notes then Outstanding will ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder. Upon payment of such amounts in the Currency in which the Notes are denominated (except as otherwise provided pursuant to Section 3.01 of the Base Indenture), all obligations of the Company in respect of the payment of principal of and interest on the Notes shall terminate.

 

ARTICLE 6

 

ADDITIONAL NOTES

 

Section 6.1            Additional Notes.  Subject to the terms and conditions contained herein, the Company may from time to time, without notice to or the consent of the existing Holders of the Notes, create and issue additional notes (the “Additional Notes”) ranking equally and ratably with the Notes in all respects (or in all respects except for the payment of interest accruing prior to the issue date of such Additional Notes or except, in some cases, for the first payment of interest following the issue date of such Additional Notes).  Any such Additional Notes, at the Company’s determination and in accordance with provisions of the Indenture, may be consolidated with and form a single series with the previously outstanding Notes for all purposes of the Indenture; provided, that if any such Additional Notes are not fungible with the previously outstanding Notes for U.S. federal income tax purposes, such Additional Notes will be issued under a different CUSIP number.

 

Section 6.2            Additional Notes Terms.  With respect to any Additional Notes, the Company shall set forth in a Board Resolution and in an Officer’s Certificate, a copy of each of which shall be delivered to the Trustee, the following information:

 

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

 

(b)           the issue price, the issue date and the CUSIP number of such Additional Notes and the amount of interest payable on the first payment date applicable thereto.

 

For the avoidance of doubt, in addition to the Officer’s Certificate, the Trustee shall also receive an Opinion of Counsel regarding the enforceability of the Additional Notes, together with the Opinion of Counsel required under Sections 14.01 and 16.01 of the Base Indenture.

 

ARTICLE 7

 

SUPPLEMENTAL INDENTURES

 

Section 7.1            Supplemental Indentures Without Consent of Holders. The following provisions relating to supplemental indentures shall apply with respect to the Notes (notwithstanding

 

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Section 14.01 of the Base Indenture, which shall be deemed amended and restated, and superseded, by the following):

 

The Company (when authorized by a Board Resolution) 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 one or more of or all the following purposes:

 

(1)           to add to the covenants and agreements of the Company to be observed thereafter and during the period, if any, in such supplemental indenture or indentures expressed, and to add Events of Defaults, in each case for the protection or benefit of the Holders, or to surrender any right or power herein conferred upon the Company;

 

(2)           to add to or change any of the provisions of this Indenture to change or eliminate any restrictions on the payment of principal of, or premium, if any, on the Notes; provided that any such action shall not adversely affect the interests of the Holders in any material respect, or to permit or facilitate the issue of the Notes in uncertificated form;

 

(3)           to change or eliminate any of the provisions of this Indenture; provided that any such change or elimination shall become effective only when there are no Notes then outstanding created prior to the execution of such supplemental indenture that are entitled to the benefit of such provision and as to which such supplemental indenture would apply;

 

(4)           to evidence the succession of another corporation to the Company, or successive successions, and the assumption by such successor of the covenants and obligations of the Company contained in the Notes and in this Indenture or any supplemental indenture;

 

(5)           to evidence and provide for the acceptance of appointment hereunder by a successor trustee with respect to the Notes and to add to or change any of the provisions of this Indenture as shall be necessary for or facilitate the administration of the trusts hereunder by more than one Trustee, pursuant to the requirements of Section 11.06(c) of the Base Indenture;

 

(6)           to secure the Notes;

 

(7)           to cure any ambiguity or to correct or supplement any provision contained herein or in any indenture supplemental hereto which may be defective or inconsistent with any other provision contained herein or in any supplemental indenture;

 

(8)           to comply with the requirements of the Trust Indenture Act or the rules and regulations of the SEC thereunder in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act, as contemplated by this Indenture or otherwise;

 

(9)           to add guarantors or co-obligors with respect to the Notes;

 

(10)         to make any change in the Notes that does not adversely affect in any material respect the interests of the Holders; provided that no such change shall be

 

16

 

deemed to adversely affect the Holders if such change is made to conform the terms of the Notes to the terms described in the Prospectus Supplement;

 

(11)         to prohibit the authentication and delivery of additional series of Notes; or

 

(12)         to establish the form and terms of the Notes as permitted in this Indenture or to authorize the issuance of additional debt securities previously authorized or to add to the conditions, limitations or restrictions on the authorized amount, terms or purposes of issue, authentication or delivery of the Notes, as set forth in this Indenture, or other conditions, limitations or restrictions thereafter to be observed.

 

Section 7.2            Supplemental Indentures With Consent of Holders. The following provisions relating to supplemental indentures shall apply with respect to the Notes (notwithstanding Section 14.02 of the Base Indenture, which shall be deemed amended and restated, and superseded, by the following):

 

With the consent of the Holders of not less than a majority in principal amount of the Outstanding Notes, the Company (when authorized by a Board Resolution) and the Trustee may, from time to time and at any time, enter into an indenture or indentures supplemental to this Indenture for the purpose of adding any provisions to or changing in any manner or eliminating any provisions of this Indenture or modifying in any manner the rights of the Holders; provided, however, that no such supplemental indenture will, without the consent of each Holder:

 

(1)           extend the Stated Maturity of the principal of, or any installment of interest on, the Notes, or reduce the principal amount thereof or the interest thereon or any premium payable upon redemption thereof, or change the Currency in which the principal of, premium, if any, or interest on the Notes is denominated or payable, or impair the right to institute suit for the enforcement of any payment on or after the Stated Maturity thereof (or, in the case of redemption, on or after the Redemption Date);

 

(2)           reduce the percentage in principal amount of the Notes, the consent of whose Holders is required for any supplemental indenture, or the consent of whose Holders is required for any waiver of compliance with certain provisions of this Indenture or certain Default hereunder and their consequences provided for in this Indenture;

 

(3)           modify any of the provisions of this Section or Section 6.06 or 7.06 of the Base Indenture, except to increase any of the respective percentages referred to therein or to provide that certain other provisions of this Indenture cannot be modified or waived without the consent of the Holder affected thereby; provided, however, that this clause shall not be deemed to require the consent of any Holder with respect to changes in the references to “the Trustee” and concomitant changes or the deletion of this proviso, in accordance with the requirements of Section 11.06 and 14.01(f) of the Base Indenture; or

 

(4)           modify, without the written consent of the Trustee, the rights, duties or immunities of the Trustee; it being understood that in no event shall the Trustee be obligated to enter into any amendment or supplemental indenture that affects its own rights, duties or immunities under this Indenture or otherwise.

 

17

 

It will not be necessary for any act of Holders under the preceding paragraph to approve the particular form of any proposed supplemental indenture, but it will be sufficient if such act will approve the substance thereof.

 

Section 7.3            Effect of Supplemental Indentures. A supplemental indenture which changes or eliminates any covenant or other provision of this Indenture with respect to the Notes or which modifies the rights of the Holders with respect to such covenant or other provision, will be deemed not to affect the rights under the Indenture of Holders of other series of Securities. A supplemental indenture which changes or eliminates any covenant or other provision of the Indenture with respect to Securities of any other series or which modifies the rights of the Holders of Securities of any other series with respect to such covenant or other provision, will be deemed not to affect the rights under the Indenture of Holders of the Notes.

 

ARTICLE 8

 

MISCELLANEOUS

 

Section 8.1            Confirmation of Base Indenture.  The Base Indenture, as supplemented by this Fourth Supplemental Indenture, is in all respects ratified and confirmed, and this Fourth Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided.

 

Section 8.2            Responsibility of Recitals, Etc.  The Trustee assumes no responsibility for the correctness of the recitals. The Trustee makes no representations as to the validity or the sufficiency of this Fourth Supplemental Indenture or of the Notes. The Trustee shall not be accountable for the use or application by the Company of the Notes or the proceeds thereof.

 

Section 8.3            Concerning the Trustee.  The Trustee does not assume any duties, responsibility or liabilities by reason of this Fourth Supplemental Indenture other than as set forth in the Indenture and, in carrying out its responsibilities hereunder, the Trustee shall have all of the rights, powers, privileges, protections and immunities which it possesses under the Indenture.  In no event shall the Trustee be responsible or liable for special, indirect, punitive or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

 

The Trustee agrees to accept and act upon instructions or directions pursuant to this Indenture sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods (including pdf files).  If the party elects to give the Trustee e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee in its discretion elects to act upon such instructions, the Trustee’s understanding of such instructions shall be deemed controlling.  The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction.  The party providing electronic instructions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk or interception and misuse by third parties.

 

Section 8.4            Governing Law.  This Fourth Supplemental Indenture and the Notes shall be governed by, and construed in accordance with, the laws of the State of New York.

 

Section 8.5            Severability.  In case any one or more of the provisions contained in this Fourth Supplemental Indenture or in the Notes shall for any reason be held to be invalid, illegal or unenforceable

 

18

 

in any respect, then, to the extent permitted by law, such invalidity, illegality or unenforceability shall not affect any other provisions of this Fourth Supplemental Indenture, or of the Notes, but this Fourth Supplemental Indenture and the Notes shall be construed as if such invalid or illegal or unenforceable provision had never been contained herein or therein.

 

Section 8.6            Counterparts.  This Fourth Supplemental Indenture may be executed in any number of counterparts each of which shall be an original, but such counterparts shall together constitute but one and the same instrument.

 

Section 8.7            Conflict with Trust Indenture Act.  If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture Act which is required to be a part of and govern this Fourth Supplemental Indenture, the provision of the Trust Indenture Act shall control.  If any provision of this Fourth Supplemental Indenture modifies or excludes any provision of the Trust Indenture Act which may be so modified or excluded, the latter provision shall be deemed to apply to this Fourth Supplemental Indenture, as so modified or excluded, as the case may be.

 

Section 8.8            Effect of Headings.  The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

 

Section 8.9            Waiver of Jury Trial.  EACH OF THE COMPANY AND THE TRUSTEE 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 INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

Section 8.10          Reports.  Delivery of reports, information and documents to the Trustee pursuant to Article X of the Indenture is for informational purposes only and the Trustee’s receipt of such shall not constitute 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 Officers’ Certificates).

 

Section 8.11          Submission to Jurisdiction.  The Company hereby irrevocably submits to the jurisdiction of any New York State court sitting in the Borough of Manhattan in the City of New York or any federal court sitting in the Borough of Manhattan in the City of New York in respect of any suit, action or proceeding arising out of or relating to this Indenture and the Notes, and irrevocably accepts for itself and in respect of its property, generally and unconditionally, jurisdiction of the aforesaid courts.

 

Section 8.12          Foreign Account Tax Compliance Act (FATCA).  In order to comply with applicable tax laws, rules and regulations (inclusive of directives, guidelines and interpretations promulgated by competent authorities) in effect from time to time (“Applicable Law”), the Company agrees (i) to provide to The Bank of New York Mellon Trust Company, N.A. sufficient information about holders or other applicable parties and/or transactions (including any modification to the terms of such transactions) so The Bank of New York Mellon Trust Company, N.A. can determine whether it has tax related obligations under Applicable Law, (ii) that The Bank of New York Mellon Trust Company, N.A. shall be entitled to make any withholding or deduction from payments under the Indenture to the extent necessary to comply with Applicable Law for which The Bank of New York Mellon Trust Company, N.A. shall not have any liability, and (iii) to hold harmless The Bank of New York Mellon Trust Company, N.A. for any losses it may suffer due to the actions it takes to comply with such Applicable Law.  The terms of this section shall survive the termination of this Indenture.

 

[Remainder of page intentionally left blank]

 

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

 

	
 
    	
AVERY DENNISON CORPORATION
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Greg Lovins
    
	
 
    	
Name:
    	
Greg Lovins
    
	
 
    	
Title:
    	
Vice President and Treasurer
    

 

[Signature Page to the Fourth Supplemental Indenture]

 

 

	
 
    	
THE BANK OF NEW YORK MELLON TRUST   COMPANY,

N.A., as Trustee
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ Lawrence M. Kusch
    
	
 
    	
Name:
    	
Lawrence M. Kusch
    
	
 
    	
Title:
    	
Vice President
    

 

[Signature Page to the Fourth Supplemental Indenture]

 

 

EXHIBIT A

 

[To be included in Global Securities — THIS NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITARY OR A NOMINEE THEREOF.  THIS NOTE MAY NOT BE EXCHANGED IN WHOLE OR IN PART FOR A NOTE REGISTERED, AND NO TRANSFER OF THIS NOTE IN WHOLE OR IN PART MAY BE REGISTERED, IN THE NAME OF ANY PERSON OTHER THAN SUCH DEPOSITARY OR A NOMINEE THEREOF, EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

 

UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR THE INDIVIDUAL SECURITIES REPRESENTED HEREBY, THIS GLOBAL SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE OR SUCH SUCCESSOR DEPOSITARY.]

 

AVERY DENNISON CORPORATION

 

1.250% Senior Notes due 2025

 

	
 
    	
CUSIP: 053611 AH2

ISIN: XS1533922263
    

 

	
No.
    	
€
    

 

Avery Dennison Corporation, a corporation duly organized and existing under the laws of Delaware (herein called the “Company,” which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to THE BANK OF NEW YORK DEPOSITORY (NOMINEES) LIMITED, as nominee of The Bank of New York Mellon (London Branch) as common depositary for Euroclear and Clearstream or registered assigns, the principal sum of [           ] EUROS (€[           ]) on March 3, 2025 and to pay interest thereon from March 3, 2017 or from the most recent Interest Payment Date to which interest has been paid or duly provided for, annually on March 3 of each year, beginning on March 3, 2018, at the rate of 1.250% per annum, until the principal hereof is paid or made available for payment.  The interest so payable, and punctually paid or duly provided for, on any Interest Payment Date shall, as provided in such Indenture, be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on the Regular Record Date for such interest, which shall be, as the case may be, the February 16 (whether or not a business day) next preceding such Interest Payment Date.  Any such interest not so punctually paid or duly provided for shall forthwith cease to be payable to the Holder on such Regular Record Date and may either be paid to the Person in whose name this Note (or one or more predecessor Notes) is registered at the close of business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Trustee, notice whereof shall be given to Holders of Notes not more than 30 days and not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Notes may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.

 

Payment of the principal of, premium, if any, and interest on this Note shall be made at the office or agency of the Company maintained for that purpose in New York, New York, in Euros as at the time of payment is legal tender for payment of public and private debts; and provided, however, that at the option of the Company, payment of interest may be made by check mailed to the address of the Person entitled thereto as such address shall appear in the Security Register or by wire transfer to an account maintained

 

A-1

 

by the Person entitled thereto as specified in the Security Register; and provided, further, the Company shall pay principal of, premium, if any, and interest on this Note in global form registered in the name of or held by Euroclear, Clearstream or such other Depositary as any officer of the Company may from time to time designate, or its respective nominee, by wire in immediately available funds to such Depositary or its nominee, as the case may be, as the Holder of this Note in global form.

 

Reference is hereby made to the further provisions of this Note set forth on the reverse hereof, which further provisions shall for all purposes have the same effect as if set forth at this place.

 

Unless the certificate of authentication hereon has been executed by the Trustee referred to on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the Indenture or be valid or obligatory for any purpose.

 

[Remainder of page intentionally left blank]

 

A-2

 

IN WITNESS WHEREOF, the Company has caused this instrument to be duly executed as of the date first written above.

 

	
 
    	
AVERY DENNISON CORPORATION
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    
	
 
    	
 
    
	
ATTESTED:
    	
 
    
	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:
    	
 
    	
 
    

 

A-3

 

This is one of the Securities issued referred to in the within-mentioned Indenture.

 

	
Dated: March [  ], 2017
    	
 
    
	
 
    	
 
    
	
 
    	
THE BANK OF NEW YORK   MELLON

TRUST COMPANY, N.A., as Trustee
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Authorized Signatory
    

 

A-4

 

[Reverse of Note]

 

This Note is one of a duly authorized series of Securities of the Company (herein called the “Note” or the “Notes,” as the case may be), issued and to be issued in one or more series under an Indenture, dated as of November 20, 2007 (herein called the “Base Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., as amended and supplemented by the Fourth Supplemental Indenture, dated as of March 3, 2017 (the “Fourth Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), between the Company and The Bank of New York Mellon Trust Company, N.A., a national banking association, as trustee (the “Trustee”).  Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Notes, and of the terms upon which the Notes are, and are to be authenticated and delivered.

 

The Notes shall be redeemable in whole or in part, at the Company’s option, at any time and from time to time at a redemption price (the “Optional Redemption Price”) equal to the greater of: (1) 100% of the principal amount of such Notes Outstanding to be redeemed; and (2) the sum of the present values of the Remaining Scheduled Payments discounted to the Redemption Date, not including any portion of any payments of interest accrued to the Redemption Date, on an annual basis (ACTUAL/ACTUAL (ICMA)) at the applicable Comparable Government Bond Rate, plus 25 basis points, plus accrued and unpaid interest thereon to, but not including, the Redemption Date; provided, however, that if the Company redeems any Notes on or after December 3, 2024 (the date falling three months prior to the Stated Maturity), the redemption price for the Notes will be equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon to, but not including, the Redemption Date.

 

Interest installments whose Stated Maturity is on or prior to such Redemption Date shall be payable to the Holders of such Notes, or one or more Predecessor Securities, of record at the close of business on the relevant Record Dates referred to on the face hereof, all as provided in the Indenture. Notice of any such redemption shall be mailed not less than 30 days and not more than 60 days prior to the Redemption Date to each Holder of the Notes to be redeemed.

 

For purposes of the redemption provisions, the following terms are applicable:

 

“Comparable Government Bond” means, in relation to any Comparable Government Bond Rate calculation a German government bond (Bundesanleihe) whose maturity is closest to the maturity of the Notes, or if such independent investment bank in its discretion determines that such similar bond is not in issue, such other German government bond as such independent investment bank may, with the advice of three brokers of, and/or market makers in, German government bonds selected by such independent investment bank, determine to be appropriate for determining the Comparable Government Bond Rate.

 

“Comparable Government Bond Rate” means, with respect to any Redemption Date, the price, expressed as a percentage (rounded to three decimal places, with 0.0005 being rounded upwards), at which the gross redemption yield on the Notes, if they were to be purchased at such price on the third business day prior to the date fixed for redemption, would be equal to the gross redemption yield on such business day of the Comparable Government Bond on the basis of the middle market price of the Comparable Government Bond prevailing at 11:00 a.m. (London time) on such business day as determined by an independent investment bank selected by the Company.

 

“Remaining Scheduled Payments” means the remaining scheduled payments of the principal and interest on the Notes to be redeemed that would be due after the related Redemption Date but for such redemption; provided, however, that if such Redemption Date is not an Interest Payment Date, the amount

 

A-5

 

of the next scheduled interest payment thereon will be reduced by the amount of interest accrued thereon to, but not including, such Redemption Date.

 

In the event of redemption of the Notes in part only, a new Note or Notes for the unredeemed portion hereof shall be issued in the name of the Holder hereof upon the cancellation hereof.

 

If a Change of Control Triggering Event occurs, unless the Company has exercised its option to redeem the Notes as described above, the Company shall be required to make an offer (the “Change of Control Offer”) to each Holder of the Notes to repurchase all or any part (equal to €100,000 or an integral multiple of €1,000 in excess thereof) of that Holder’s Notes on the terms set forth herein. In a Change of Control Offer, the Company shall be required to offer payment in cash equal to 101% of the aggregate principal amount of Notes repurchased, plus accrued and unpaid interest, if any, on the Note repurchased to, but not including, the repurchase date (the “Change of Control Payment”). Within 30 days following any Change of Control Triggering Event or, at the Company’s option, prior to any Change of Control, but after public announcement of the transaction that constitutes or may constitute the Change of Control, a notice shall be mailed to Holders of Notes describing the transaction that constitutes or may constitute the Change of Control Triggering Event and offering to repurchase the Notes on the repurchase date specified in the applicable notice, which date shall be no earlier than 30 days and no later than 60 days from the date on which such notice is mailed (the “Change of Control Payment Date”) pursuant to the procedures described in such notice and in conformity with the Indenture.

 

The notice shall, if mailed prior to the date of the consummation of the Change of Control, state that the Change of Control Offer is conditioned on the Change of Control Triggering Event occurring prior to or on the applicable Change of Control Payment Date specified in the notice.

 

On any applicable Change of Control Payment Date, the Company shall, to the extent lawful: (a) accept for payment all Notes or portions of Notes properly tendered pursuant to the Change of Control Offer; (b) deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions of Notes properly tendered pursuant to the applicable Change of Control Offer; and (c) deliver or cause to be delivered to the Trustee the Notes properly accepted together with an Officer’s Certificate stating the aggregate principal amount of Notes or portions of Notes being repurchased.

 

The Company shall not be required to make the Change of Control Offer upon the Change of Control Triggering Event if a third party makes such an offer in the manner, at the times and otherwise in compliance with the requirements for an offer made by the Company, and the third party repurchases all Notes properly tendered and not withdrawn under its offer. In addition, the Company shall not repurchase any Notes if there has occurred and is continuing on the Change of Control Payment Date an Event of Default under the Indenture, other than a default in the payment of the Change of Control Payment upon a Change of Control Triggering Event.

 

The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with the repurchase of the Notes as a result of a Change of Control Triggering Event. To the extent that the provisions of any securities laws or regulations conflict with the Change of Control Offer provisions of the Notes, the Company shall comply with those securities laws and regulations and shall not be deemed to have breached the Company’s obligations under the Change of Control Offer provisions of the Notes by virtue of any such conflict.

 

For purposes of the Change of Control Offer provisions, the following terms are applicable:

 

“Change of Control” means the occurrence of any of the following:

 

A-6

 

(a)                                 the direct or indirect sale, transfer, conveyance or other disposition (other than by way of merger or consolidation), in one or more series of related transactions, of all or substantially all of the Company’s assets and the Company’s Subsidiaries’ assets, taken as a whole, to any person, other than the Company or one of the Company’s Subsidiaries;

 

(b)                                 the consummation of any transaction (including, without limitation, any merger or consolidation), the result of which is that any person becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than 50% of the Company’s outstanding Voting Stock or other Voting Stock into which the Company’s Voting Stock is reclassified, consolidated, exchanged or changed, measured by voting power rather than number of shares; or

 

(c)                                  the adoption of a plan relating to the Company’s liquidation or dissolution.

 

Notwithstanding the foregoing, a transaction shall not be deemed to involve a Change of Control if (a) the Company becomes a direct or indirect wholly-owned Subsidiary of a holding company and (b)(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 the Company’s Voting Stock immediately prior to that transaction or (2) immediately following that transaction no person (other than a holding company satisfying the requirements of this sentence) is the beneficial owner, directly or indirectly, of more than 50% of the Voting Stock of such holding company. The term “person,” as used in this definition, has the meaning given thereto in Section 13(d)(3) of the Exchange Act.

 

“Change of Control Triggering Event” means the occurrence of both a Change of Control and a Rating Event.

 

“Investment Grade” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, and the equivalent Investment Grade credit rating from any replacement Rating Agency or Rating Agencies selected by the Company.

 

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

 

“Person” means an individual, a corporation, a limited liability company, a partnership, a joint-stock company, a trust, an unincorporated organization or a government or an agency or political subdivision thereof.

 

“Rating Agencies” means (a) each of Moody’s and S&P; and (b) if either of Moody’s or S&P ceases to rate the Notes or fails to make a rating of the Notes publicly available for reasons outside of the Company’s control, a “nationally recognized statistical rating organization” within the meaning of Section 3(a)(62) of the Exchange Act selected by the Company (as certified by a resolution of the Company’s Board of Directors) as a replacement agency for Moody’s or S&P, or both of them, as the case may be.

 

“Rating Event” means the rating on the Notes is lowered by each of the Rating Agencies and the Notes are rated below Investment Grade by each of the Rating Agencies on any day within the 60-day period (which 60-day 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) after the earlier of (1) the occurrence of a Change of Control and (2) public notice of the occurrence of a Change of Control or the Company’s intention to effect a Change of Control; provided, however, that a Rating Event otherwise arising by virtue of a particular reduction in rating will not be deemed to have occurred in respect of a particular Change of Control (and thus will not be deemed a Rating Event for purposes of the definition of Change of Control Triggering Event) if the Rating Agencies making the reduction in rating to which this

 

A-7

 

definition would otherwise apply do not announce or publicly confirm or inform the Company in writing that the reduction was the result, in whole or in part, of any event or circumstance comprised of or arising as a result of, or in respect of, the applicable Change of Control (whether or not the applicable Change of Control has occurred at the time of the Rating Event).

 

“S&P” means S&P Global Ratings and its successors.

 

“Voting Stock” means, with respect to any specified “person” (as that term is used in Section 13(d)(3) of the Exchange Act) as of any date, the capital stock of such person that is at the time entitled to vote generally in the election of the board of directors of such person.

 

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

 

The Indenture contains provisions for defeasance and discharge at any time of (1) the entire indebtedness of the Notes or (ii) certain restrictive covenants and Events of Default with respect to the Notes, in each case upon compliance with certain conditions set forth in the Indenture.

 

If an Event of Default with respect to the Notes shall occur and be continuing, the principal of the Notes may be declared or shall become due and payable in the manner and with the effect provided in the Indenture.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Notes to be affected under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in principal amount of the Notes at the time Outstanding to be affected.  The Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Notes at the time Outstanding, on behalf of the Holders of all Notes, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this Note shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of any Notes issued upon the registration of transfer hereof or in exchange herefor or in lieu hereof, whether or not notation of such consent or waiver is made upon this Note.

 

As provided in and subject to the provisions of the Indenture, no Holder shall have any right to institute any action, suit or proceeding at law or in equity for the execution of any trust under the Indenture or for the appointment of a receiver or for any other remedy hereunder, in each case with respect to an Event of Default with respect to the Notes, unless such Holder previously shall have given to the Trustee written notice of the happening of one or more of the Events of Default, and unless also the Holders of 25% in principal amount of the Notes than Outstanding shall have requested the Trustee in writing to take action in respect of the matter complained of, and unless also there shall have been offered to the Trustee security and indemnity satisfactory to it against the costs, expenses and liabilities to be incurred therein or thereby, and the Trustee, for 60 days after receipt of such notification, request and offer of indemnity, shall have neglected or refused to institute any such action, suit or proceeding; and such notification, request and offer of indemnity are hereby declared in every such case to be conditions precedent to any such action, suit or proceeding by any Holder; it being understood and intended that no one or more of the Holders shall have any right in any manner whatsoever by his, her, its or their action to enforce any right under the Indenture, except in the manner therein provided, and that every action, suit or proceeding at law or in equity shall be instituted, had and maintained in the manner provided in the Indenture and for the equal benefit of all Holders of the Outstanding Notes.

 

A-8

 

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

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of the Notes is registrable in the Security Register, upon surrender of the Notes for registration of transfer at the office or agency of the Company in any place where the principal of, premium, if any, and interest on the Notes are payable, duly endorsed by or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Notes and of like tenor, of authorized denominations and for the same aggregate principal amount, shall be issued to the designated transferee or transferees.

 

The Notes are issuable only in registered form without coupons in minimum denominations of €100,000 and integral multiple of €1,000 in excess thereof.  As provided in the Indenture and subject to certain limitations therein set forth, the Notes are exchangeable for a like aggregate principal amount of Notes and of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.

 

No service charge shall be made for any such registration of transfer or exchange, but the Company or the Trustee may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

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

 

All capitalized terms used, but not defined, in the Notes shall have the meanings assigned to them in the Indenture.

 

A-9EX-10.1

Exhibit 10.1

EASTGROUP PROPERTIES, INC.

2013 EQUITY INCENTIVE PLAN

1. Introduction.

EastGroup Properties, Inc., (the “Company”) establishes the EastGroup Properties, Inc. 2013
Equity Incentive Plan (the “Plan”), effective May 29, 2013 as amended and restated as of March 3,
2017.

2. Purposes.

The purposes of the Plan are to provide incentive for Employees and Directors to exert their
best efforts on behalf of the Company, and to further the identity of the interests of Employees
and Directors with those of the Company’s shareholders by encouraging Employees’ and Directors’
ownership of Shares in the Company. To serve these purposes the Plan offers equity-based incentive
awards.

3. Definitions.

As used in this Plan:

(a) “Award Agreement” means a written agreement entered into between the Company and a
Participant or other documentation issued by the Company, in either case setting forth the terms of
an award granted under the Plan. An Award Agreement shall be subject to the terms of the Plan.

(b) “Board of Directors” or “Board” means the Board of Directors of the Company.

(c) “Cause” has the meaning given in Section 13(b).

(d) “Change in Control” has the meaning given in Section 13(b).

(e) “Committee” means a committee of the Board of Directors of the Company designated by the
Board, which committee shall be composed of those members of the Compensation Committee of the
Board of Directors who are non-employee directors as that term is defined under Securities and
Exchange Commission Rule 16b-3 and outside directors as that term is defined for the purposes of
the Internal Revenue Code section 162(m), provided that, should there be fewer than two members of
the Compensation Committee who are both non-employee directors and outside directors, the Committee
shall be composed of two or more members of the Board of Directors designated by the Board who are
non-employee directors and outside directors, including anyone who is a member of the Compensation
Committee.

(f) “Common Shares” or “Shares” means the shares of common stock, $0.0001 par value per Share,
of the Company.

(g) “Director” means a member of the Board of Directors of the Company.

(h) “Employee” means an employee of the Company or a Subsidiary.

(i) “Exchange Act” means the Securities Exchange Act of 1934, as amended from time to time.

(j) “Fair Market Value” of a Common Share means, on a given date, (i) if the Common Shares are
traded in the over-the-counter market, the mean between the closing bid and asked prices of a Share
on that date, or, if no prices are so quoted on that date, on the next preceding date on which such
prices are so quoted, or, (ii) if the Common Shares are traded on a national securities exchange,
the closing price of a Share as reported on such exchange on that date, or, if no prices are so
reported on that date, on the next preceding date on which such prices are so reported; provided,
however, in either case, that if Shares shall not have been publicly traded for more than ten days
immediately preceding such date, then the Fair Market Value of a Share shall be determined by the
Committee in such manner as it may find appropriate.

(k) “Good Reason” has the meaning given in Section 13(b).

1

(l) “Internal Revenue Code” or “Code” means the Internal Revenue Code of 1986, as amended from
time to time.

(m) “Misconduct” means conduct of a Participant that, in the Committee’s judgment,
constitutes:

(i) a commission of an act of theft, embezzlement, fraud, dishonesty, or other criminal act,
harmful to the Company or a Subsidiary,

(ii) a breach of a fiduciary duty owed to the Company or a Subsidiary,

(iii) a deliberate and serious disregard of rules of the Company or a Subsidiary,

(iv) an unauthorized disclosure of any of the trade secrets or confidential information of the
Company or a Subsidiary, or

(v) competition with the Company or a Subsidiary.

(n) “Participant” means an Employee or Director who holds an outstanding award under the Plan.

(o) “Performance Goal” means an objective test of performance based on one or more of the
following criteria: revenue; earnings; net earnings; operating earnings; earnings before taxes;
earnings before income tax expense, interest expense, and depreciation and amortization expense
(“EBITDA”); earnings per Share; stock price; costs; return on equity; return on assets; assets
management; asset quality; asset growth; budget achievement; net operating income (“NOI”); average
occupancy; year-end occupancy; funds from operations (“FFO”); adjusted funds from operations
(“AFFO”); funds available for distribution (“FAD”); dividend or FAD payment; total shareholder
return on an absolute basis or a relative basis measured against comparable peers or a real estate
index; leverage ratios; capital expenditures; customer satisfaction survey results; property
operating expense savings; design, development, permitting, or other progress on designated
properties; third-party fee generation; leasing goals; goals relating to acquisitions or
divestitures, targeted financing, or capital market objectives; lease retention; liability
management; credit management; certain levels of operating expense; growth in assets, unit volume,
revenue, sales, or market share; or strategic business criteria consisting of one or more
objectives based on meeting specified revenue goals, market penetration goals, geographic business
expansion goals, or cost targets. Performance Goals may differ from Participant to Participant and
award to award and may be established for the Company as a whole, on a per Share basis, or for the
Company’s various properties, groups, divisions, or Subsidiaries, or a combination of them.
Performance Goals may be based on absolute performance or on performance relative to performance of
unrelated businesses specified by the Committee, on other external measures of the selected
performance criteria, or on comparison to any prior period or to budget or target. All
calculations and financial accounting matters relevant to this Plan and to which GAAP applies shall
be determined in accordance with GAAP as in effect on the date of an award, except as otherwise
specified by the Committee. For example, the Committee may specify that the measurement of
performance shall include or exclude particular items, such as losses from discontinued operations,
debt prepayment penalties, extraordinary gains or losses, the cumulative effect of accounting
changes, acquisitions or divestitures, or nonrecurring gains or loss.

(p) “Permanent Disability” means a medically determinable physical or mental impairment that
may be expected to result in death or to last at least a year and that renders an Employee
incapable of performing that Employee’s duties with the Company. A determination of disability
shall be made by the Committee in a uniform, nondiscriminatory manner on the basis of medical
evidence. Notwithstanding the foregoing, in the case of a determination that would accelerate
payment of Restricted Share Units or other awards or amounts that are deferred compensation subject
to Code section 409A, a Participant shall be considered to have a “Permanent Disability” only if
the Participant is “disabled” within the meaning of Code section 409A or the regulations issued
under that section.

(q) “Restricted Period” means the period described in Section 8(b)(i) or Section 9(b)(i).

(r) “Restricted Share” means an award granted pursuant to Section 8.

2

(s) “Restricted Share Unit” or “RSU” means an award granted pursuant to Section 9.

(t) “Retirement” means the termination of a Participant’s employment with the Company and its
Subsidiaries after the Participant has attained age 65, or after the Participant has attained age
55 and completed at least six years of employment.

(u) “Subsidiary” means a corporation, partnership, joint venture, or other entity in which the
Company has an equity, profit, or voting interest of at least 50 percent.

4. Administration.

The Committee shall administer the Plan. The Committee shall have all the powers and
authority vested in it by the terms of the Plan. The Committee shall have full power and authority
to interpret the Plan and Award Agreements, to prescribe, amend, and rescind rules and regulations
relating to the Plan, and to make any determinations it finds necessary or advisable for the
administration of the Plan. The Committee may correct any defect or supply any omission or
reconcile any inconsistency in the Plan or in any Award Agreement in the manner and to the extent
the Committee in its discretion deems desirable. The Committee shall have complete discretion in
the exercise of its powers and authority under the Plan, and the Committee’s interpretations,
determinations, and decisions in the administration of the Plan shall be final and conclusive. The
Committee may act only by a majority of its members in office, except that:

(a) The Committee may authorize any one or more of its members or any officer of the Company
to execute and deliver documents on behalf of the Committee.

(b) The Committee may delegate ministerial duties and authority to interpret the Plan and
respond to claims to an officer of the Company. The Committee may not delegate authority with
respect to (i) nonministerial actions affecting Participants subject to the reporting requirements
of the Exchange Act, (ii) nonministerial actions with respect to awards intended to qualify for the
performance based exception under Code section 162(m), or (iii) the certification of the
satisfaction of Performance Goals.

(c) The Committee may delegate to the Chief Executive Officer or his or her delegate some or
all of the Committee’s discretion and authority with respect to the granting of specified forms of
awards and with respect to the granting of awards to specified categories of Employees, subject to
paragraph (b) above and to any limits the Committee may provide. By way of example, the Committee
may delegate to the Chief Executive Officer discretion and authority to determine when and under
what terms the Company shall grant awards Units to newly-hired or newly-promoted officers, and the
Committee may provide limits on the form and number of such awards.

No Committee member and no delegate of the Committee shall be liable for any determination
made in good faith with respect to the Plan, an award, or a Participant.

5. Shares Subject to Plan and Limits on Awards.

(a) Share Available. Subject to adjustment pursuant to Section 12, the maximum number
of Common Shares with respect to which awards may be granted under the Plan is 2,000,000.

(b) Limits on Awards. Subject to adjustment pursuant to Section 12, the following
additional limits shall apply to awards under the Plan:

(i) The aggregate number of Common Shares that may be made subject to Restricted Share and
Restricted Share Unit awards granted under the Plan to any individual Participant during any one
calendar year may not exceed 100,000.

(ii) The aggregate number of Common Shares that may be made subject to awards granted under
the Plan to any individual Participant during any one calendar year may not exceed 100,000.

This limit shall apply regardless of whether awards are to be or may be paid in cash rather
than Shares.

3

(c) Cancellation or Expiration of Awards; Payment in Common Shares.

(i) General. If all or a portion of an award under the Plan is cancelled or expires
for any reason before having been fully vested, is settled in cash in lieu of Common Shares, or is
exchanged for other awards, all Common Shares covered by the portion of any such award that is
cancelled or expires, is settled in cash, or is exchanged for other awards shall again become
available for award under the Plan.

(ii) Payments in Shares. Common Shares tendered or withheld to satisfy the Company’s
tax withholding obligation shall again become available for award under the Plan;
provided, however, that for purposes of this Section 5(c)(ii), only those Common Shares having
a Fair Market Value equal to the minimum statutory amount required to be withheld to satisfy the
tax withholding obligations related to an Award will become available for future award under the
Plan (that is, the number of Common Shares that could have been withheld by the Company prior to
the effectiveness of the amendments to FASB Accounting Standards Codification Topic 718,
Compensation – Stock Compensation, as amended by FASB Accounting Standards Update No. 2016-09,
Improvements to Employee Share-Based Payment Accounting, to avoid adverse financial accounting
consequences with respect to any such tax withholding relating to an Award).

6. Eligibility.

Employees and Directors shall be eligible to receive awards under the Plan, provided that no
Employee or Director shall be entitled to an award except as determined by the Committee or as
provided by any Independent Director Compensation Policy described in Section 11.

7. Awards.

(a) Types of Awards. Awards under the Plan may be in the form of: Restricted Shares,
Restricted Share Units, and other Share based awards (as described in Section 10).

(b) Award Agreements. The Committee shall set forth the terms of each award in an
Award Agreement. An Award Agreement may contain any provision approved by the Committee, subject
to the terms of the Plan. An Award Agreement may make provision for any matter that is within the
discretion of the Committee or may reserve for the Committee discretion to approve or authorize any
action with respect to the award.

(c) Nonuniform Determinations. The Committee’s determinations under the Plan or Award
Agreements, including, without limitation, the selection of Participants to receive awards, the
type, form, amount, and timing of awards, and the terms of specific Award Agreements, need not be
uniform, regardless of whether Participants are similarly situated.

(d) Qualification for Section 162(m) Exception.

(i) Committee’s Certification of Satisfaction of Performance Goals. If the
exercisability, payment, or vesting of an award is conditioned upon the satisfaction of Performance
Goals, and the award is intended to qualify for the exception under Code section 162(m) for
performance-based pay, the condition shall not be considered satisfied, and the award shall not be
exercisable, payable, or vest, as applicable, unless the Committee certifies that the Performance
Goal has been satisfied.

(ii) Satisfaction of Other Requirements. To the extent an award is intended to
qualify for the exception under Code section 162(m) for performance-based pay, the Committee shall
make such provisions in Award Agreements and follow such procedures as may be required to satisfy
the conditions of the exception. By way of example, the Committee shall establish any Performance
Goal associated with such an award by the time within the performance period required for such
exception, and the payment terms for such an award shall conform to the requirements of the
exception.

(e) Discretion. The Committee shall have no discretion to increase the amount of an
outstanding award but may reserve discretion to decrease the amount of an outstanding award or the
extent to which it is exercisable or payable.

(f) Provisions Governing All Awards. All awards shall be subject to the following
provisions:

4

(i) Transferability. An award shall not be transferable other than by will or the
laws of descent and distribution. During the lifetime of the Participant awards requiring exercise
shall be exercisable only by the Participant or, in the event the Participant becomes legally
incompetent, by the Participant’s guardian or legal representative.

(ii) Employment Rights. Neither the adoption of the Plan nor the grant of an award
shall confer on a Participant the right to continue employment with the Company or a Subsidiary,
nor shall it interfere with the right of the Company or a Subsidiary to terminate a Participant’s
employment at any time for any reason, with or without cause.

(iii) Section 83(b) Election. No Participant may make an election under Code
section 83(b) with respect to any award under the Plan without the consent of the Committee, which
the Committee may grant or withhold in its sole discretion. If, with the consent of the Committee,
a Participant makes an election under Code section 83(b) to be taxed with respect to an award as of
the date of transfer of the award rather than as of the date or dates upon which the award would
otherwise be taxable under Code section 83(a), the Participant shall be required to deliver a copy
of such election to the Company promptly after filing such election with the Internal Revenue
Service.

(g) Misconduct. Should the Committee determine that a Participant has committed
Misconduct, the Participant shall forfeit all rights under outstanding awards and all further
benefits under or attributable to the Plan, so neither the Participant nor his or her estate or
successors shall be entitled to become vested in Restricted Shares and Restricted Share Units, be
paid any Shares or amounts remaining to be paid upon settlement of an award or due under a deferred
payment arrangement with respect to an award, or otherwise be entitled to any further benefit under
or attributable to the Plan. Before making such a determination, the Committee shall give the
Participant a reasonable opportunity to be heard.

(h) Recoupment of Awards. The Committee may provide in an Award Agreement or in a
policy applicable to an award under this Plan that, under conditions specified in the Award
Agreement or policy, the Participant shall forfeit all rights under the award and all further
benefits under or attributable to the award or the Plan, and the Participant shall be obliged to
pay back or return to the Company amounts or Shares previously paid, distributed, or vested under
the award, including dividends and dividend equivalents. Such conditions may include, by way of
illustration and not by way of limitation, the occurrence of an error in financial statements that
results in the payment of a greater amount of performance-based compensation than would have been
paid based on correct financial statements. This paragraph and Paragraph 7(g) shall be construed
independently of each other; one shall not limit the application of the other.

8. Restricted Shares.

(a) Grant of Restricted Shares. The Company shall grant Restricted Shares to
Participants under the Plan at such times, in such numbers, and upon such terms as the Committee
shall determine.

(b) Terms of Restricted Shares. The Award Agreement for a grant of Restricted Shares
shall set forth such terms, conditions, restrictions, and limits on the Restricted Shares as the
Committee shall determine and as are consistent with the Plan, including the following:

(i) Conditions on Vesting. The Participant’s interest in a Restricted Share award
shall be forfeitable when the award is granted. In the Award Agreement, the Committee shall
prescribe conditions that must be satisfied and the time by which, or time period during which, the
conditions must be satisfied, in order for the Participant’s interest to become vested. The
conditions may include one or more of the following:

(1) the satisfaction of specified Performance Goals by a specified time or during a specified
period,

(2) the continuance of the Participant’s employment or service for a specified period, or

(3) the satisfaction of other specified conditions.

5

The Award Agreement may provide that the extent of the Participant’s vested interest shall be
determined by the extent to which a condition is satisfied. The limited period of time provided
for the satisfaction of the conditions on an award shall be referred to as the “Restricted Period”.
If the only vesting condition to be satisfied is the continuance of the Participant’s employment
or service, the Restricted Period shall not be shorter than three years, provided that the award
may vest ratably over that period.

(ii) Vesting. Upon the satisfaction, within the Restricted Period, of the conditions
established by the Committee, or as provided in paragraph (vi), the Participant’s interest in the
Restricted Shares shall become vested to the extent provided in the Award Agreement. The
restrictions applicable to those vested Restricted Shares shall lapse at that time, and the Company
shall deliver a certificate for those vested Shares to the Participant or the Participant’s estate
or the person to whom the Participant’s rights are transferred by will or under the laws of descent
and distribution, as the case may be, free of all restrictions, subject to the satisfaction of the
Company’s withholding obligations as described in Section 18(c).

(iii) Forfeiture. Except as provided by the Committee in accordance with paragraph
(vi), the Participant shall forfeit Restricted Shares upon the expiration of the Restricted Period,
to the extent the conditions prescribed by the Committee have not been satisfied. Upon such a
forfeiture, all of the Participant’s interest in the forfeited Restricted Shares shall
automatically revert to the Company.

(iv) Retention of Certificate. The Company shall issue, for the benefit of the
Participant, the number of Common Shares subject to a Restricted Shares award, but the Company
shall retain custody of any certificate for such Shares during the Restricted Period.

(v) Voting and Dividend Rights. Unless otherwise provided by the Committee in the
Award Agreement, the Participant to whom Restricted Shares have been granted shall be entitled,
during the Restricted Period, to vote those Shares and to receive the dividends payable with
respect to those Shares. If the vesting of an award is conditioned on the satisfaction of a
Performance Goal or other performance-related condition, the Committee shall provide in the Award
Agreement that no dividends shall be payable with respect to the Restricted Shares during the
Restricted Period, but the Committee may make provision for dividend equivalents under Paragraph
10(b)(vii).

(vi) Death or Disability; Termination Without Cause. The Committee may provide that
upon the termination of the Participant’s employment or service during the Restricted Period by
reason of death or Permanent Disability or by the Company without Cause, the conditions and
restrictions on all or a portion of the Restricted Shares shall lapse and the Participant’s
interest in those Shares shall become vested.

(vii) Dividend Equivalents. The Committee may provide in the Award Agreement that the
Participant shall receive, rather than the dividends payable with respect to specified Restricted
Shares, a credit equivalent to the amount of such dividends, which shall be payable to the
Participant only if the Participant’s interest in the specified Restricted Shares becomes vested;
if the Employee forfeits the specified Restricted Shares, the Employee shall simultaneously forfeit
the dividend equivalents attributable to such Restricted Shares. The Award Agreement shall specify
the time for payment of dividend equivalents, which shall not be later than March 15th following
the calendar year in which the Restricted Shares to which the dividend equivalents are attributable
become vested, subject to Section 18(b) with respect to deferrals. Section 9(c)(ii) and (iii)
shall apply to dividend equivalents under Restricted Shares as well as under Restricted Share
Units.

9. Restricted Share Units.

(a) Grant of Restricted Share Units. A Restricted Share Unit shall entitle a
Participant to a Share, the Fair Market Value of a Share in cash, or a combination of the two, at a
future date, subject to the satisfaction of any terms and conditions specified by the Committee.
The Company shall grant Restricted Share Units to Participants under the Plan at such times, in
such numbers, and upon such terms as the Committee shall determine.

(b) Terms of Restricted Share Units. The Award Agreement for Restricted Share Units
shall set forth such terms, conditions, restrictions, and limits on the Units as the Committee
shall determine and as are consistent with the provisions of the Plan, including the following:

6

(i) Conditions on Vesting. The Participant’s interest in a Restricted Share Unit
award shall be forfeitable when the award is granted. In the Award Agreement, the Committee shall
prescribe conditions that must be satisfied and the time by which, or time period during which, the
conditions must be satisfied, in order for the Participant’s interest to become vested. The
conditions may include one or more of the following:

(1) the satisfaction of specified Performance Goals by a specified time or during a specified
period,

(2) the continuance of the Participant’s employment or service for a specified period, or

(3) the satisfaction of other specified conditions.

The Award Agreement may provide that the extent of the Participant’s vested interest shall be
determined by the extent to which a condition is satisfied. The limited period of time provided
for the satisfaction of the conditions on an award shall be referred to as the “Restricted Period”.
If the only vesting condition to be satisfied is the continuance of the Participant’s employment
or service, the Restricted Period shall not be shorter than three years, provided that the award
may vest ratably over that period.

(ii) Vesting. Upon the satisfaction, within the Restricted Period, of the conditions
established by the Committee, or as provided in paragraph (v), the Participant’s interest in the
Restricted Share Units shall become vested to the extent provided in the Award Agreement.

(iii) Forfeiture. Except as provided by the Committee in accordance with paragraph
(v), the Participant shall forfeit Restricted Share Units upon the expiration of the Restricted
Period, to the extent the conditions prescribed by the Committee have not been satisfied. Upon
such a forfeiture, all of the Participant’s interest in the forfeited Restricted Share Units shall
automatically revert to the Company.

(iv) No Dividends or Voting Rights. A Restricted Share Unit shall carry with it no
voting or dividend or other rights associated with Common Share ownership.

(v) Death or Disability; Termination Without Cause; Retirement. The Committee may
provide that upon the Participant’s Retirement, or the termination of the Participant’s employment
or service during the Restricted Period by reason of death or Permanent Disability or by the
Company without Cause, the conditions and restrictions on all or a portion of the Restricted Share
Units shall lapse and the Restricted Period with respect to those Units shall expire.

(vi) Dividend Equivalents. Notwithstanding paragraph (iv), the Committee may but
need not provide that a bookkeeping account established for a Participant shall be credited with an
amount equivalent to the amount of dividends that would be payable with respect to a number of
Shares equal to the number of Restricted Share Units awarded to the Participant. The Committee may
provide for the crediting of interest on any dividend equivalents credited to a Participant’s
account or may provide that the dividend equivalent credit be adjusted for hypothetical investment
experience in such manner as the Committee may determine. If the Participant forfeits his or her
interest in a Restricted Share Unit, the Participant shall simultaneously forfeit any dividend
equivalents (as adjusted) attributable to those Restricted Share Units.

(c) Payment of Vested Restricted Share Units.

(i) Payment of vested Restricted Share Units and other amounts credited to a Participant’s
account shall be made at such time or times after the expiration of the Restricted Period as the
Committee may establish. The Committee may but need not provide that a Participant may elect to
defer payment until such time or times as the Committee may allow. The Committee may provide for
payments in lump sums or installments or both. The Committee shall establish procedures for its
establishment of the time of payment and for the form and timing of a Participant’s deferral and
payment elections. All elections shall conform to the Committee’s procedures. The Committee’s
procedures shall conform to the requirements of Code section 409A for the deferral (until payment)
of the inclusion of compensation in gross income.

7

(ii) The Company shall not establish any special fund with respect to a Participant’s account.
Any credit entries made to a Participant’s account shall constitute a mere promise by the Company
to make payments to the Participant, subject to and in accordance with the Plan, from the general
assets of the Company, when the payments become due.

(iii) To the extent that any person acquires a right to receive payments from the Company
under this Plan, such right shall be no greater than the right of any unsecured general creditor of
the Company.

10. Other Awards. The Committee may determine, subject to the terms of the Plan, that
the Company shall grant awards that are not described in Section 8 or 9, but that provide for the
issuance of Common Shares, or that are denominated in or measured by the Fair Market Value of a
Share, or that provide for payment in the form of Shares rather than cash under any Company
compensation, bonus, or incentive program. The Committee shall determine the terms and conditions
of any such other awards and the Participants to whom and the numbers in which such other awards
shall be granted. The Committee may condition the exercisability, vesting, and payment of such
other awards upon the satisfaction of Performance Goals.

11. Awards to Independent Directors. Notwithstanding any other provision of the Plan,
the grant of any award to a Director who is not also an Employee (an “Independent Director”) shall
be made by the Board only pursuant to a written nondiscretionary formula established by the Board
(an “Independent Director Compensation Policy”). An Independent Director Compensation Policy
shall set forth the type of awards to be granted to Independent Directors, the number of Shares to
be subject to Independent Director awards, the conditions on which such awards shall be granted,
become exercisable, payable, and expire, and such other terms and conditions as the Board
determines in its discretion. Awards granted to Independent Directors shall be subject to all of
the limits set forth in this Plan.

12. Required Adjustments in Authorized Shares. In the event of any change in corporate
capitalization, such as a stock split, or a corporate transaction, such as a merger, consolidation,
separation, including a spin off, or other distribution of stock or property of the Company, any
reorganization (whether or not such reorganization comes within the definition of such term in Code
section 368), or any partial or complete liquidation of the Company, such adjustment shall be made
in the number and class of Shares available for awards under Section 5, in the number of Shares
subject to outstanding awards, and in the limits on awards and the issuance of Shares set forth in
Section 5, as determined by the Committee to be appropriate and equitable to prevent dilution or
enlargement of the benefits available under the Plan and of the rights of Participants, provided,
however, that the number of Shares subject to an award shall always be a whole number. In a
stock-for-stock acquisition of the Company, the Committee may, in its discretion, substitute
securities of another issuer for any Shares subject to outstanding awards.

Except as expressly provided in this Section, the issuance by the Company of shares of any
class or securities convertible into shares of any class, for cash, property, labor or services,
upon direct sale, upon the exercise of rights or warrants, or upon the conversion of shares or
obligations of the Company convertible into such shares or other securities, and in any case
whether or not for fair value, shall not affect, and no adjustment shall be made with respect to,
the number of Shares subject to awards previously granted.

13. Change in Control.

(a) Impact of Event. Notwithstanding any provision of the Plan to the contrary, in
the event of a Change in Control, the provisions of this Section 13 shall apply:

(i) If and to the extent that outstanding awards under the Plan (A) are continued or assumed
by the successor corporation (or an affiliate of the successor) or continued or (B) are replaced
with equity awards that preserve the existing value of the awards at the time of the Change in
Control and provide for subsequent payout in accordance with a vesting schedule and Performance
Goals, as applicable, that are the same or more favorable to the Participants than the vesting
schedule and Performance Goals applicable to the awards, then all such awards or such substitutes
for them shall remain outstanding and be governed by their respective terms and the provisions of
the Plan subject to Section 13(a)(v).

8

(ii) If and to the extent that outstanding awards under the Plan are not continued, assumed,
or replaced in accordance with Section 13(a)(i), then upon the Change in Control the following
treatment (referred to as “Change-in-Control Treatment”) shall apply to such awards:  the
restrictions and other conditions applicable to outstanding Restricted Shares, Restricted Share
Units, and other Share-based Awards, including vesting requirements, shall immediately lapse, and
any Performance Goals relevant to such awards shall be deemed to have been achieved at the target
performance level; such Awards shall be free of all restrictions and fully vested; and, with
respect to Restricted Share Units, shall be payable immediately in accordance with their terms or,
if later, as of the earliest date permissible under Code section 409A.

(iii) However, unless the Change in Control is a change in the ownership or effective control
or of ownership of a substantial portion of the assets of the Company (within the meaning of Code
section 409A), a Change in Control shall not accelerate the time of payment of Restricted Share
Units and other awards and amounts payable under the Plan that are deferred compensation subject to
Code section 409A.

(iv) If and to the extent that outstanding awards under the Plan are not continued, assumed,
or replaced in accordance with Section 13(a)(i) above, then in connection with the application of
the Change-in-Control Treatment set forth in Section 13(a)(ii) above, the Board may, in its sole
discretion, provide for cancellation of such outstanding awards at the time of the Change in
Control in which case a payment of cash, property, or a combination of cash and property shall be
made to each such Participant upon the consummation of the Change in Control that is determined by
the Board in its sole discretion and that is at least equal to the value of the consideration that
would be received in such Change in Control by the holders of the Company’s securities for such
awards.

(v) If and to the extent that (A) outstanding awards are continued, assumed, or replaced in
accordance with Section 13(a)(i) above and (B) a Participant’s employment with, or performance of
services for, the Company is terminated by the Company for any reasons other than Cause or by such
Participant for Good Reason, in each case, within the two-year period commencing on the Change in
Control, then, as of the date of such Participant’s termination, the Change-in-Control Treatment
set forth in Section 13(a)(ii) above shall apply to all assumed or replaced awards of such
Participant then outstanding.

(b) Definitions.

(i) For the purposes of this Plan, a “Change in Control” of the Company means a change in
control of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Securities and Exchange Act of 1934, as amended (the
“Exchange Act”), whether or not the Company is then subject to such reporting requirements;
provided that, without limitation, such a Change in Control shall be deemed to have occurred if (A)
any “person” (as such term is used in section 13(d) and 14(d) of the Exchange Act) is or becomes
“beneficial owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing 30 percent or more of the combined voting power of the
Company’s then outstanding securities; or (B) during any period of two consecutive years, the
following persons (the “Continuing Directors”) cease for any reason to constitute a majority of the
Board: individuals who at the beginning of such period constitute the Board and new Directors each
of whose election to the Board or nomination for election to the Board by the Company’s security
holders was approved by a vote of at least two-thirds of the Directors then still in office who
either were Directors at the beginning of the period or whose election or nomination for election
was previously so approved; or (C) the consummation of a merger or consolidation of the Company
with any other corporation, other than (1) a merger or consolidation that would result in the
voting securities of the Company outstanding immediately before the merger or consolidation
continuing to represent (either by remaining outstanding or by being converted into voting
securities of such surviving entity) more than 50 percent of the combined voting power of the
voting securities of the Company or of such surviving entity outstanding immediately after such
merger or consolidation or (2) a merger or consolidation that is approved by a Board having a
majority of its members persons who are Continuing Directors, of which Continuing Directors not
less than two-thirds have approved the merger or consolidation; or (D) the security holders of the
Company approve a plan of complete liquidation of the Company or an agreement for the sale or
disposition by the Company of all or substantially all of the Company’s assets.

(ii) For the purposes of this Section 13, “Cause” means (A) the continued failure by the
Participant to perform his or her material responsibilities and duties toward the Company (other
than

9

any such failure resulting from the Participant’s incapacity due to physical or mental illness),
(B) the engaging by the Participant in willful or reckless conduct that is demonstrably injurious
to the Company monetarily or otherwise, (C) the Participant’s conviction, entry of a plea of nolo
contendere, or admission of guilt, for any felony or any lesser crime if such lesser crime involves
fraud or dishonesty, moral turpitude, or any conduct that adversely affects the business or
reputation of the Company, (iv) the commission or omission of any act by the Executive that
constitutes on the part of the Executive fraud, dishonesty, or malfeasance, misfeasance, or
nonfeasance of duty toward the Company; or (v) any other action or conduct by the Executive that is
injurious to the Company, its business, or its reputation; provided, however, that
“Cause” shall not include the Executive’s lack of professional qualifications. For purposes of
this Agreement, an act, or failure to act, on the Executive’s part shall be considered “willful” or
“reckless” only if done, or omitted, by him not in good faith and without reasonable belief that
his action or omission was in the best interest of the Company.

(iii) For the purposes of this Section 13, “Good Reason” means:

(1) the assignment to the Participant after the Change in Control of any duties materially
inconsistent with the Participant’s position (including status, offices, titles, and reporting
requirements, authority, duties or responsibilities), or any other action that results in a
material diminution in such position, authority, duties, or responsibilities;

(2) a material reduction by the Company in the Participant’s base salary in effect immediately
before the Change in Control or as subsequently increased;

(3) a material reduction by the Company in the Participant’s annual bonus opportunity or in
the target level for such bonus or in the level of the Participant’s long term equity incentive, as
compared to such opportunity or level in effect immediately before the Change in Control; or

(4) the Company’s requiring the Participant, without the Participant’s written consent, to be
based at any office or location materially distant from the Participant’s office location
immediately before the Change in Control, except for travel reasonably required in the performance
of the Participant’s responsibilities.

A termination for Good Reason must be communicated by the Participant to the Company by written
notice that specifies the event or events claimed to provide a basis for termination for Good
Reason; provided that the Participant’s written notice must be tendered within ninety days of the
occurrence of such event or events and provided further that the Company shall have failed to
remedy such act or omission within thirty days following its receipt of such notice. A
Participant’s continued employment shall not constitute consent to, or a waiver of rights with
respect to, any act or failure to act constituting Good Reason if the Participant actually
terminates employment within fourteen days after the Company’s failure to timely remedy or, if
earlier, prior to the second anniversary of the Change in Control.

14. Term of Plan. The Plan shall take effect on May 29, 2013. Unless terminated
earlier by the Board of Directors, the Plan shall terminate on May 28, 2023, provided that awards
outstanding on that date shall survive in accordance with their terms.

15. Amendment of Awards. The Committee may at any time unilaterally amend any
outstanding award to the extent the Committee determines necessary or desirable, provided, however,
that an amendment that would be adverse to the interests of the Participant shall not be effective
without the holder’s consent.

16. Amendment and Termination of Plan. The Board may amend, suspend, or terminate the
Plan or any portion of the Plan at any time, provided no amendment may be made without stockholder
approval if such approval is required by applicable law or the requirements of an applicable stock
exchange, or if such amendment would increase the Shares available under the Plan or the limits on
award provided under Section 5, except as provided in Section 12.

10

17. Restrictions on Acceleration of Payment Date; Deferrals; Delay of Payment to Specified
Employee.

(a) Acceleration or Deferral. Notwithstanding any contrary provision of Section 15
or 16, an action by the Board or Committee shall not accelerate or defer a payment of an award that
is deferred compensation within the meaning of Code section 409A except as follows:

(i) An action may accelerate the payment of all or part of an award upon the following events:
the termination and liquidation of the Plan or any other event the Commissioner of Internal
Revenue may prescribe in generally applicable guidance under Code section 409A, provided, in any
event, that the terms and conditions of the acceleration would not cause the Plan to fail to meet
the requirements of section 409A and of any generally applicable guidance published by the
Commissioner of Internal Revenue under section 409A for the deferral (until payment) of the
inclusion of awards in gross income.

(ii) An action may defer a payment date for all or a part of an award under the following
circumstances:

(1) The Board or Committee reasonably anticipates that, if an award were to be paid as
scheduled, the Company’s deduction with respect to such payment would not be permitted under Code
section 162(m), provided such scheduled payment is then made during the Participant’s first taxable
year in which the Board or Committee reasonably anticipates that the Company’s deduction will not
be barred by application of Code section 162(m).

(2) The Board or Committee reasonably anticipates that the payment of an award as scheduled
will violate federal securities laws or other applicable law; provided that the scheduled payment
is then made at the earliest date on which the Board or Committee reasonably determines that making
the scheduled payment will not cause such a violation.

(3) Such other events or conditions as the Commissioner of Internal Revenue may prescribe in
generally applicable guidance that the Board or Committee, in its discretion, chooses to apply
under the Plan; provided, however, that a Participant shall have no direct or indirect election as
to the application of such events or conditions to his or her individual circumstances, and further
provided, in any event under this paragraph (ii), that the terms and conditions of the deferral
would not cause the Plan to fail to meet the requirements of section 409A for the deferral (until
payment) of the inclusion of awards in gross income.

(b) Delay of Payment to Specified Employee. If an award is payable to a Participant
on account of separation from service (within the meaning of Code section 409A), and the
Participant is a specified employee, the payment may not be made before the date that is six months
after the Participant’s separation from service (or, if earlier, the Participant’s death).
“Specified employee” means, with respect to the relevant 12-month period beginning on an April 1
and during which the Company remains publicly traded, a Participant who was a “key employee” within
the meaning of Code section 416(i), without regard to section 416(i)(5), at any time during the
calendar year preceding the applicable April 1.

18. Miscellaneous.

(a) Beneficiary Designation. Each Participant may, from time to time, name any
beneficiary or beneficiaries (who may be named contingently or successively) to whom any benefit
under the Plan is to be paid in case of the Participant’s death before the Participant receives any
or all of such benefit. A designation shall automatically revoke all prior designations by the
same Participant with respect to such benefit, shall be in a form prescribed by the Company, and
shall be effective only when filed by the Participant in writing with the Committee or its delegate
during the Participant’s lifetime. In the absence of any such designation, any benefits remaining
payable under the Plan at the Participant’s death shall be paid when due to the Participant’s
estate unless otherwise provided in the Award Agreement.

(b) Deferrals. Pursuant to the applicable requirements of Code section 409A, the
Committee may permit or require a Participant to defer receipt of the payment of cash or the
delivery of Shares that would otherwise be due pursuant to the lapse or waiver of restrictions with
respect to Restricted Stock or Restricted Stock Units, or in connection with any other awards. If
any such deferral is required or permitted, the Committee shall establish rules and procedures for
such deferrals in compliance with the requirements of Code section 409A.

11

(c) Satisfaction of Tax Liabilities.

(i) The Company and its Subsidiaries shall have the power and the right to deduct or withhold,
or to require a Participant to remit to the Company or to a Subsidiary, an amount that the Company
or a Subsidiary reasonably determines to be required to comply with federal, state, local, or
foreign tax withholding requirements with respect to the settlement or vesting of an award. The
Company or a Subsidiary may require the payment of such taxes before Shares deliverable pursuant to
such award are transferred to the holder of the award.

(ii) The Committee, in its sole discretion and pursuant to such procedures as it may specify
from time to time, may permit a Participant to satisfy such tax withholding obligation with respect
to an award to be settled in Shares, in whole or in part by (without limitation) (1) paying cash,
(2) electing to have the Company withhold otherwise deliverable cash or Shares having a Fair Market
Value equal to the minimum statutory amount required to be withheld or an amount up to the maximum
statutory rate in a particular jurisdiction if that would not result in adverse financial
accounting treatment as determined by the Company (and in particular in connection with the
effectiveness of the amendments to FASB Accounting Standards Codification Topic 718, Compensation –
Stock Compensation, as amended by FASB Accounting Standards Update No. 2016-09, Improvements to
Employee Share-Based Payment Accounting), or (3) delivering to the Company already-owned Shares
having a Fair Market Value equal to the minimum statutory amount required to be withheld. The
value of each Share withheld, or delivered, shall be the Fair Market Value of a Share on the date
an award becomes taxable.

(d) No Alienation. Except to the extent required by law, the right of a Participant
or beneficiary to payment under this Plan shall not be subject to anticipation, alienation, sale,
transfer, assignment, pledge, encumbrance, attachment, or garnishment by creditors of the
Participant or beneficiary.

19. Restrictions on Issuance of Common Shares.

Should the Board of Directors determine that the listing, registration, or qualification of
Common Shares upon any securities exchange or under any state or federal law or the consent or
approval of any governmental regulatory body is necessary or desirable as a condition to or in
connection with the issuance or delivery of Common Shares under the Plan, no such Common Shares
shall be issued or delivered unless such listing, registration, qualification, consent, or approval
has been effected or obtained free of any conditions not acceptable to the Board of Directors.

The certificates representing Common Shares issued by the Company under the Plan may bear a
legend describing any restrictions on resale of such Common Shares under applicable securities
laws, and stop transfer orders with respect to such certificates may be entered on the Company’s
stock transfer records.

20. Construction.

(a) In General. The Plan shall be construed in accordance with the law of the State
of Maryland. With respect to awards granted under the Plan that are intended to qualify for the
exception under Code section 162(m) for performance-based pay, the terms of the Plan and the Award
Agreement shall be construed and administered to give effect to such intention, unless the
Committee determines to waive the application of such exception. With respect to awards granted
under the Plan that provide for the payment of deferred compensation (within the meaning of Code
section 409A), the terms of the Plan and the Award Agreement shall be construed to conform to the
requirements of Code section 409A for the deferral (until payment) of the inclusion of the
compensation in gross income.

(b) REIT Status. The Plan shall be construed in a manner consistent with the
Company’s status as a real estate investment trust (“REIT”). No award shall be granted, and with
respect to any award granted under the Plan, such award shall not vest, be exercisable, or be
settled:

(i) to the extent that the grant, vesting, or settlement of such award could cause the
Participant or any other person to be in violation of the ownership limit or any other provision of
the Company’s organizing documents; or

(ii) if, in the discretion of the Committee, the grant, vesting, or settlement of such award
could impair the Company’s status as a REIT.

12

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