Document:

Exhibit 10.4

 

HARTE HANKS, INC.
 PERFORMANCE STOCK UNIT AGREEMENT

 

	
To: Jon C. Biro
    	
Date of Grant:   November     , 2017
    

 

Number of PSUs:

 

HARTE HANKS, INC. (the “Company”), is pleased to grant you, as an inducement material to your entry into employment with the Company, a Performance Stock Unit Award (the “Performance Stock Unit Award”) with respect to a number of performance stock units (“PSUs”), subject to the terms and conditions set forth in this Performance Stock Unit Award Agreement (this “Agreement”).  Each PSU represents your right to receive one share of Stock (defined below) on the applicable settlement date set forth below, to the extent earned and vested in accordance with this Agreement, including Exhibit A attached hereto.  The grant of the Performance Stock Unit Award is specifically conditioned upon (i) the approval of this grant to you by the Board (as defined below), and (ii) the execution by you of this Agreement, agreeing to all of the terms and conditions set forth herein.  The Date of Grant and the number of PSUs subject to this Performance Stock Unit Award are stated above.  The Performance Stock Unit Award is not governed by the Harte-Hanks, Inc. 2013 Omnibus Incentive Plan, 2005 Omnibus Incentive Plan or by any other equity compensation plan of the Company (or of any of its affiliates).  Instead, this Performance Stock Unit Award is made outside of any equity compensation plan of the Company (or any of its affiliates), as an inducement contemplated by Section 303A.08 of the New York Stock Exchange Listed Company Manual.  No payment is required for the Stock that you receive pursuant to this Performance Stock Unit Award.

 

This Agreement sets forth the terms of the agreement between you and the Company with respect to the Performance Stock Unit Award.  By accepting this Agreement, you agree to be bound by all of the terms hereof.

 

1.                                     Definitions.  Unless otherwise defined herein, as used in this Agreement, the following terms have the meanings set forth below:

 

(a)                                 “Board” means the board of directors of the Company.

 

(b)                                “Change in Control” means the first day that any one or more of the following conditions shall have been satisfied:

 

(i)                                     the acquisition of any outstanding voting securities by any person, after which such person (as the term is used for purposes of Section 13(d) or 14(d) of the Exchange Act) has beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more of the then outstanding voting securities of the Company; provided, however, that for purposes of this definition, the following acquisitions shall not constitute a Change in Control: (A) any acquisition directly from the Company, (B) any acquisition by the Company, (C) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any company controlled by,

 

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controlling or under common control with the Company, or (D) any acquisition by any corporation  pursuant to a transaction that complies with Sections (iii)(A) and (iii)(B) of this definition;

 

(ii)                                  individuals who, as of the Date of Grant, constitute the Board of Directors (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual becoming a director subsequent to the Date of Grant, whose election, or nomination for election by the Company’s stockholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of an actual or threatened election contest with respect to the election or removal of directors or other actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board;

 

(iii)                               consummation of a reorganization, merger, statutory share exchange or consolidation or similar corporate transaction involving the Company, or the acquisition of assets or stock of another entity by the Company or any of its subsidiaries (each, a “Business Combination”), in each case unless (A) the stockholders of the Company immediately prior to such Business Combination beneficially own, directly or indirectly, more than 50% of the combined voting power of the outstanding voting securities of the entity resulting from such Business Combination (including, without limitation, an entity that, as a result of such transaction, owns the Company or all or substantially all of the Company’s assets either directly or through one or more subsidiaries), and (B) at least a majority of the members of the board of directors of the corporation resulting from such Business Combination were members of the Incumbent Board at the time of the execution of the initial agreement or of the action of the Board providing for such Business Combination; or

 

(iv)                              approval by the stockholders of the Company of a complete liquidation or dissolution of the Company.

 

(c)                                 “Change in Control Severance Agreement” means that certain Change in Control Severance Agreement by and between the Company and you, effective on or about the date you commenced employment with the Company, as may be amended from time to time with your consent.

 

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

 

(e)                                 “Committee” means the Compensation Committee of the Board.

 

(f)                                   “Date of Grant” means the date designated as such on the first page of this Agreement.

 

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

 

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(h)                                 “Fair Market Value” means with respect to Stock, as of any date, the closing price of a share of Stock on the New York Stock Exchange for the last trading day  prior to that date.  If no such prices are reported, then Fair Market Value shall mean the average of the high and low sale prices for the Stock (or if no sale prices are reported, the average of the high and low bid prices) as reported by the principal regional stock exchange, or if not so reported, as reported by Nasdaq or a quotation system of general circulation to brokers and dealers; provided, however, that with respect to same day sales, Fair Market Value shall mean the per share price actually paid for shares of Stock in connection with such sale.

 

(i)                                     “Stock” means the Company’s $1.00 par value per share voting common stock, or any other securities that are substituted therefor.

 

2.                                     Vesting.  The PSUs subject to this Performance Stock Unit Award vest based on the attainment of the Performance Criteria used for PSUs awarded to other non-CEO executive officers of the Company in 2017, provided you are employed with the Company from the Date of Grant through February 15, 2020.  Other than pursuant to the terms of the Change in Control Severance Agreement, if your employment terminates prior to the date the PSUs vest, all unvested PSUs shall be forfeited at the time of such termination.  In addition, if you fail to satisfy the applicable requirements of the Change in Control Severance Agreement (including the delivery of an irrevocable release), PSUs which would otherwise vest pursuant to the Change in Control Severance Agreement shall be forfeited.

 

3.                                     Settlement.  Upon vesting, in settlement of each vested PSU (if any), you will receive one share of Stock on February 15, 2020.  Upon settlement of vested PSUs, the Stock will be held in a book entry account at the Company’s transfer agent, from whom you may request transfer or issuance of a certificate to you.

 

4.                                     Restrictions.  You may not sell, transfer, pledge or otherwise encumber or dispose of, make any short sale of, grant any option for the purchase of or enter into any hedging or similar transaction with the same economic effect as a sale of, any PSUs.  After settlement, as described above, PSUs that vest and are settled in accordance with the terms of this Agreement will no longer be considered PSUs.

 

5.                                     No Privileges of a Stockholder.  You will not have any privileges of a stockholder, including the right to vote the PSUs or to receive dividends (or dividend equivalents) thereon, until the PSUs vest and are settled in accordance with the terms of this Agreement.

 

6.                                     Conditions.  Notwithstanding any provision of this Agreement to the contrary, the issuance of Stock upon vesting and settlement of the PSUs will be subject to compliance with all applicable requirements of federal, state, or foreign law with respect to such securities and with the requirements of any stock exchange or market system upon which the Stock may then be listed.  No Stock will be issued hereunder if such issuance would constitute a violation of any applicable federal, state, or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed. The Company may require you, as a condition of receiving the Stock, to give written assurances in substance and form satisfactory to the Company and its counsel to the effect that you are acquiring the

 

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Stock subject to the Performance Stock Unit Award for your own account for investment and not with any present intention of selling or otherwise distributing the same, and to such  other effects as the Company deems necessary or appropriate to comply with federal and applicable state securities laws.

 

7.                                     Change in Capital Structure.  In the event that the Board determines that any dividend or other distribution (whether in the form of cash, Stock, other securities or other property), recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, liquidation, dissolution or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, or exchange of Stock or other securities of the Company, issuance of warrants or other rights to purchase Stock or other securities of the Company, or other similar corporate transaction or event including a Change in Control, in the Board’s sole discretion, affects the Stock such that an adjustment is determined by the Board to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, then the Board shall direct the Committee to, in such manner as it determines is equitable, adjust any or all of the number and kind of shares of Stock (or other securities or property) underlying the PSUs subject to the Performance Stock Unit Award; provided that no such adjustment shall be affected if it would cause the Performance Stock Unit Award to become subject to, and not compliant with, Section 409A of the Code.  This Agreement shall not in any way affect or restrict the right or power of the Company or the stockholders of the Company to make or authorize any adjustment, recapitalization, reorganization or other change in the Company’s capital structure or its business, any merger or consolidation of the Company, any issue of stock or of options, warrants or rights to purchase stock or of bonds, debentures, preferred or prior preference stocks whose rights are superior to or affect the Stock or the rights thereof or which are convertible into or exchangeable for Stock, or the dissolution or liquidation of the Company, or any sale or transfer of all or any part of its assets or business, or any other corporate act or proceeding, whether of a similar character or otherwise.

 

8.                                     Extraordinary Events.  In the event of any transaction or event described in Section 7 or any unusual or nonrecurring transaction or event affecting the Company, any affiliate of the Company or the financial statements of the Company or any affiliate, or of changes in applicable laws, regulations or accounting principles occurs, including any Change in Control, the Board, in its sole and absolute discretion, and on such terms and conditions as it deems appropriate, is hereby authorized to direct the Committee to take any one or more of the following actions whenever the Board determines that such action is appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under this Agreement, to facilitate such transactions or events or to give effect to such changes in laws, regulations or principles:

 

(a)                                 To provide for the cancellation of the Performance Stock Unit Award in exchange for an amount of cash equal to the amount that could have been attained upon the realization of your rights had the Performance Stock Unit Award been fully vested and settled (including an amount equal to zero if no cash could have been so attained or realized);

 

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(b)                                To provide that the Performance Stock Unit Award cannot vest or be settled after such event; provided, however, that no action shall be taken pursuant to this clause (b) without your consent, which consent shall not be unreasonably withheld;

 

(c)                                 To provide that such Performance Stock Unit Award shall be vested and settled as to all PSUs covered thereby and that all restrictions with respect thereto shall lapse, notwithstanding anything to the contrary herein;

 

(d)                                To provide that the Performance Stock Unit Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares subject to the award; and

 

(e)                                 To make such other adjustments in the number and type of shares of Stock (or other securities or property) underlying the PSUs subject to the Performance Stock Unit Award; provided that no such adjustment shall be affected if it would cause the Performance Stock Unit Award to become subject to, and not compliant with, Section 409A of the Code.

 

9.                                     Authority of the Committee.  This Agreement and the Performance Stock Unit Award granted hereunder shall be administered by the Committee except to the extent the Board elects to administer this Agreement and the PSUs granted hereunder, in which case references herein to the “Committee” shall be deemed to include references to the “Board.”  The Committee shall have the authority, in its sole and absolute discretion, to (i) adopt, amend, and rescind administrative and interpretive rules and regulations relating to this Agreement; (ii) determine whether and to what extent the Performance Criteria set forth on Exhibit A attached hereto have been attained; (iii) accelerate the time of vesting and settlement of the PSUs; (iv) construe this Agreement and the Performance Stock Unit Award; (v) make determinations of the Fair Market Value of the Stock underlying the PSUs subject to this Agreement; (vi) delegate its duties under this Agreement to such agents as it may appoint from time to time; (vii) terminate, modify, or amend this Agreement, provided that, no amendment or termination may decrease your rights inherent in the Performance Stock Unit Award prior to such amendment without your express written permission except to the extent such amendment is necessary to comply with applicable laws and regulations and to conform the provisions of this Agreement to any change thereto; and (viii) make all other determinations, perform all other acts, and exercise all other powers and authority necessary or advisable for administering this Agreement, including the delegation of those ministerial acts and responsibilities as the Committee deems appropriate.  The Committee may correct any defect, supply any omission, or reconcile any inconsistency in this Agreement in the manner and to the extent it deems necessary or desirable to carry the Agreement into effect, and the Committee shall be the sole and final judge of that necessity or desirability.  The determinations of the Committee on the matters referred to in this Section 9 shall be final and conclusive.

 

10.                              Section 16.  Notwithstanding any other provisions of this Agreement, the grant of this Performance Stock Unit Award shall comply with the applicable provisions of Rule 16b-3 promulgated under the Exchange Act and shall be subject to any additional limitations set forth in any applicable exemptive rule under Section 16 of the

 

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Exchange Act (including any amendment to Rule 16b-3) that are requirements for the application of such exemptive rule.  To the extent permitted by applicable law, the Performance Stock Unit Award shall be deemed amended to the extent necessary to conform to such applicable exemptive rule.

 

11.                              Withholding Taxes.  No shares of Stock will be released to you upon settlement of the PSUs unless you have made acceptable arrangements to pay any withholding taxes that may be due upon settlement of the PSUs subject to this Performance Stock Unit Award.  These arrangements may include withholding of shares of Stock that otherwise would be issued to you when the PSUs are settled.  The Fair Market Value of the Stock withheld (determined as of the date when the taxes otherwise would have been withheld in cash) will be applied as a credit against the taxes. Notwithstanding any action the Company takes with respect to any or all income tax, social insurance, payroll tax or other tax-related withholding (“Tax Related Items”), the ultimate liability for all Tax Related Items is and remains your responsibility and the Company (a) makes no representation or undertakings regarding the treatment of any Tax Related Items in connection with the granting, vesting or settlement of the PSUs or the subsequent sale of any shares of such Stock that you receive upon settlement of the PSUs and (b) does not commit to structure the Performance Stock Unit Award to reduce or eliminate your liability for Tax Related Items.

 

12.                              Notices.  Any notice to be given under the terms of this Agreement shall be deemed to have been duly given or made only if (i) delivered personally or by overnight courier, (ii) delivered by facsimile transmission with answer back confirmation, (iii) mailed (postage prepaid by certified or registered mail, return receipt requested) (effective upon actual receipt), or (iv) delivered by electronic communication to the address below.  An electronic communication (“Electronic Notice”) shall be deemed written notice for purposes of this letter if sent with return receipt requested to the electronic mail address specified by the receiving party.  Electronic Notice shall be deemed received at the time the party sending Electronic Notice receives verification of receipt by the receiving party.  The party receiving Electronic Notice may request and shall be entitled to receive the notice on paper, in a non-electronic form (“Non-electronic Notice”) which shall be sent to the requesting party within five days after receipt of the written request for Non-electronic Notice.  Either party from time to time may change its address, facsimile number, electronic mail address, or other information for the purpose of notices to that party by giving written notice specifying such change to the other party hereto.

 

If to the Executive:  at the most recent address reflected in the payroll records of the Company

 

	
If to the Company:
    	
 
    	
Harte   Hanks, Inc.
    
	
 
    	
 
    	
9601   McAllister Freeway, Suite 610
    
	
 
    	
 
    	
San   Antonio, Texas 78216
    
	
 
    	
 
    	
Attention:   General Counsel
    
	
 
    	
 
    	
Email:   general.counsel@hartehanks.com
    

 

or to such other address as either party may furnish to the other in writing in accordance herewith, except that notices of changes of address shall be effective only upon receipt.

 

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13.                              No Guarantee of Continued Service.  You acknowledge and agree that the vesting and settlement of PSUs pursuant to this Agreement is earned only by continuing as an employee at the will of the Company (and not through the act of being hired or being granted this Performance Stock Unit Award).  You further acknowledge and agree that this Agreement, the transactions contemplated hereunder and the vesting and settlement schedule set forth herein do not constitute an express or implied promise  of continued employment through the applicable vesting and settlement period, for any period, or at all, and shall not interfere in any way with your right or the right of the Company or any affiliate to dismiss you from employment, free from any liability, or any claim under this Agreement, at any time with or without cause.

 

14.                              Protection of Goodwill.  You acknowledge that the Company is providing you with this Performance Stock Unit Award in connection with and in consideration for your promises and covenants contained herein.  Specifically, in consideration for the Performance Stock Unit Award, which you acknowledge provides a material incentive for you to grow, develop and protect the goodwill and confidential and proprietary information of the Company, you agree that the Performance Stock Unit Award (itself and in combination with any other awards made to you) constitutes independent and sufficient consideration for all non-competition, non-solicitation and confidentiality covenants between you and the Company, and agree and acknowledge that you will fully abide by each of such covenants.  You further acknowledge that your promise to fully abide by each of the protective covenants referenced above is a material inducement for the Company to provide you with the Performance Stock Unit Award.

 

15.                              Successors & Assigns.  Subject to the limitations on the transferability of this Performance Stock Unit Award and the PSUs, this Agreement shall be binding upon and inure to the benefit of the heirs, legal representatives, successors and assigns of the parties hereto.

 

16.                              Governing Law.  The interpretation, performance and enforcement of this Agreement shall be governed by the laws of the State of Delaware, without giving effect to any conflict of law provisions thereof, except to the extent Delaware law is preempted by federal law.  The obligation of the Company to sell and deliver Stock hereunder is subject to applicable laws and to the approval of any governmental authority required in connection with the authorization, issuance, sale, or delivery of such Stock.

 

17.                              Clawback.  Pursuant to the Dodd-Frank Wall Street Reform and Consumer Protection Act (the “Act”), the PSUs subject to this Agreement shall not be deemed fully earned or vested, even if Stock is distributed to you upon settlement of the PSUs, if this Performance Stock Unit Award or any portion thereof is deemed “incentive compensation” and subject to recovery, or “clawback,” by the Company pursuant to the provisions of the Act and any rules or regulations promulgated thereunder or by any stock exchange on which the Company’s securities are listed (the “Rules”).  In addition, you hereby acknowledge that this Agreement may be amended as necessary and/or shall be subject to any recoupment policies adopted by the Company to comply with the requirements and/or limitations under the Act and the Rules, or any other federal or stock exchange requirements, including by expressly permitting (or, if applicable, requiring) the Company to revoke, recover and/or clawback the shares of Stock issued pursuant hereto.

 

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18.                              Other Benefits.  The amount of any compensation deemed to be received by you as a result of the receipt, vesting or settlement of this Performance Stock Unit Award will not constitute “earnings” with respect to any other benefits provided to you by the Company or an affiliate, including without limitation benefits under any pension, profit sharing, life insurance or salary continuation plan.

 

19.                              Furnish Information.  You shall furnish to the Company all information requested by the Company to enable it to comply with any reporting or other requirements imposed upon the Company by or under any applicable statute or regulation.  From time to time, the Board and appropriate officers of the Company shall and are authorized to take whatever action is necessary to file required documents with governmental authorities and other appropriate persons to make shares of Stock available for issuance pursuant to this Agreement.

 

20.                              No Liability for Good Faith Determinations. The Company and the members of the Committee and the Board shall not be liable for any act, omission or determination taken or made in good faith with respect to this Agreement or the PSUs granted hereunder.

 

21.                              Execution of Receipts and Releases.  Any payment of cash or any issuance or transfer of shares of Stock or other property to you, or to your legal representative, heir, legatee or distributee, in accordance with the provisions hereof, shall, to the extent thereof, be in full satisfaction of all claims of such persons hereunder. The Company may require you or your legal representative, heir, legatee or distributee, as a condition precedent to such payment or issuance, to execute a release and receipt therefor in such form as it shall determine.

 

22.                              No Guarantee of Interests.  None of the Committee, the Board or the Company guarantees the Stock of the Company from loss or depreciation.

 

23.                              Company Records.  Records of the Company or its affiliates regarding your period of employment, termination of employment and the reason therefor, leaves of absence, re-employment, and other matters shall be conclusive for all purposes hereunder, unless determined by the Company to be incorrect.

 

24.                              Company Action.  Any action required of the Company shall be by resolution of its Board or by a person authorized to act by resolution of the Board.

 

25.                              Entire Agreement.  This Agreement constitutes the entire agreement of the parties with respect to the subject matter hereof and supersedes in their entirety all prior undertakings and agreements of the Company and you with respect to the subject matter hereof.  This Agreement may not be modified in a manner that impairs your rights heretofore granted, except with your consent or as necessary to comply with applicable law or stock exchange rules..

 

26.                              Counterparts. This Agreement may be executed in counterparts, each of which shall be deemed an original but all of which together will constitute one and the same instrument. Counterpart signature pages to this Agreement transmitted by facsimile transmission, by electronic mail in portable document format (.pdf), or by any other electronic means intended to preserve the original graphic and pictorial

 

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appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

 

27.                              Severability.  If any provision of this Agreement is held to be illegal or invalid for any reason, the illegality or invalidity shall not affect the remaining provisions  hereof, but such provision shall be fully severable and this Agreement shall be construed and enforced as if the illegal or invalid provision had never been included herein.

 

28.                              Headings; Word Usage.   The titles and headings of Sections are included for convenience of reference only and are not to be considered in construction of the provisions hereof.  Words used in the masculine shall apply to the feminine where applicable, and wherever the context of this Agreement dictates, the plural shall be read as the singular and the singular as the plural.

 

29.                              Fractional Shares.  In no event may the PSUs be adjusted for any fractional shares.  The Committee shall determine whether cash or other property shall be issued or paid in lieu of such fractional shares or whether such fractional shares or any rights thereto shall be forfeited or otherwise eliminated.

 

30.                              Section 409A.  This Agreement is intended to be exempt from Section 409A of the Code under the “short-term deferral” exception and to the extent this Agreement is subject to Section 409A of the Code, it will in all respects be administered in accordance with Section 409A of the Code, including the “six-month” delay, to the extent applicable.

 

31.                              Unfunded Obligation.  The Company’s obligation under this Agreement shall not be funded or secured in any manner or at any time (including in connection with the change of the Company’s financial health), and the Company shall not be required or permitted to establish any special or separate fund or to make any other segregation of funds or assets to insure payment under this Agreement against the claims of general creditors.

 

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its duly authorized officer as of the Date of Grant first above written.

 

	
 
    	
HARTE HANKS, INC.
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Robert L.   R. Munden
    
	
 
    	
 
    	
Senior Vice   President,
    
	
 
    	
 
    	
General   Counsel & Secretary
    
	
 
    	
 
    
	
ACKNOWLEDGED AND AGREED:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Jon C. Biro
    	
 
    

 

9Exhibit 4.4

 

EXECUTION VERSION

 

FIRST SUPPLEMENTAL INDENTURE

 

FIRST SUPPLEMENTAL INDENTURE, dated as of November 3, 2017 (this “Supplemental Indenture”), by and between SANTANDER UK PLC, a public limited company incorporated in England and Wales (the “Issuer”) and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association incorporated in the United States (the “Trustee”), as trustee, having its Corporate Trust Office at 150 East 42nd Street, 40th Floor, New York, NY 10017.

 

W I T N E S S E T H:

 

WHEREAS, the Issuer and Law Debenture Trust Company of New York (the “Former Trustee”) have executed and delivered an Indenture dated as of September 29, 2016 (the “Base Indenture”);

 

WHEREAS, Section 6.11(a) of the Base Indenture provides that any successor trustee appointed with respect to all Senior Debt Securities shall, in accordance with the Base Indenture execute, acknowledge and deliver to the Issuer and to the retiring trustee an instrument accepting such appointment under the Base Indenture, and thereupon the resignation of the retiring trustee shall become effective and such successor trustee, without any further act, deed or conveyance, shall become vested with all rights, powers, duties and obligations of the retiring trustee;

 

WHEREAS, in satisfaction of Section 6.11(a) of the Base Indenture, the Issuer, the Former Trustee and the Trustee entered into an Agreement of Resignation, Appointment and Acceptance, dated as of June 2, 2017, whereby the Former Trustee resigned as trustee, and the Trustee was appointed, and accepted its appointment, as trustee under the Indenture (as defined below);

 

WHEREAS, Section 9.01(d) of the Base Indenture provides that the Issuer and the Trustee may enter into a supplemental indenture to add to, change or eliminate any of the provisions of the Base Indenture, or any supplemental indenture, provided that any such change or elimination shall become effective only when there is no Senior Debt Security Outstanding of any series created prior to the execution of such supplemental indenture effecting such change or elimination which is entitled to the benefit of such provision, and adversely affected by such addition, change or elimination;

 

WHEREAS, Section 9.01(f) of the Base Indenture provides that the Issuer and the Trustee may enter into a supplemental indenture to establish the forms or terms of the Senior Debt Securities of any series without the consent of Holders as permitted under Sections 2.01 or 3.01 of the Base Indenture;

 

WHEREAS, the Issuer desires to issue $1,200,000,000 2.125% Notes due 2020 (such series of Senior Debt Securities, the “Fixed Rate Notes”) and $300,000,000 Floating Rate Notes due 2020 (such series of Senior Debt Securities, the “Floating Rate Notes,” and, together with the Fixed Rate Notes, the “Notes”) pursuant to the Base Indenture (as supplemented and amended by this Supplemental Indenture and together with the Base Indenture, the “Indenture”);

 

WHEREAS, all conditions and requirements necessary to make this Supplemental Indenture a valid and binding instrument in accordance with the terms of the Base Indenture have been performed and fulfilled and the execution and delivery hereof have been in all respects duly authorized;

 

NOW, THEREFORE, each party agrees as follows for the benefit of the other parties and the equal and ratable benefit of the Holders of the Notes.

 

 

ARTICLE 1
 DEFINITIONS

 

Section 1.01.                          Definition of Terms. For all purposes of this Supplemental Indenture:

 

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

 

(b)                                 all other terms used herein that are defined in the Trust Indenture Act, either directly or by reference therein, have the meanings assigned to them therein;

 

(c)                                  the terms defined in this Article have the meanings assigned to them in this Article and include the plural as well as the singular;

 

(d)                                 the section headings herein are for convenience only and shall not affect the construction of this Supplemental Indenture; and

 

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

 

Section 1.02.                          Supplemental Definitions. The following definitions shall apply to the Notes only:

 

(a)                                 “Accrued Interest Factor” has the meaning set forth in clause (d)(2) of Section 2.02 of this Supplemental Indenture.

 

(b)                                 “Base Indenture” has the meaning set forth in the recitals to this Supplemental Indenture.

 

(c)                                  “Business Day” means any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in the City of New York or London, England are authorized or required by law, regulation or executive order to close.

 

(d)                                 “Calculation Agent” means Wells Fargo Bank, National Association, or its successor appointed by the Issuer.

 

(e)                                  “Fixed Rate Interest Payment Date” has the meaning set forth in clause (d) of Section 2.01 of this Supplemental Indenture.

 

(f)                                   “Fixed Rate Notes” has the meaning set forth in the recitals to this Supplemental Indenture.

 

(g)                                  “Fixed Rate Notes Maturity Date” has the meaning set forth in clause (c) of Section 2.01 of this Supplemental Indenture.

 

(h)                                 “Floating Rate Interest Determination Date” means the second London Banking Day preceding the applicable Floating Rate Interest Reset Date.

 

(i)                                     “Floating Rate Interest Payment Date” has the meaning set forth in clause (d)(1) of Section 2.02 of this Supplemental Indenture.

 

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(j)                                    “Floating Rate Interest Reset Date” has the meaning set forth in clause (d)(3) of Section 2.02 of this Supplemental Indenture.

 

(k)                                 “Floating Rate Notes” has the meaning set forth in the recitals to this Supplemental Indenture.

 

(l)                                     “Floating Rate Notes Maturity Date” has the meaning set forth in clause (c) of Section 2.02 of this Supplemental Indenture.

 

(m)                             “Former Trustee” has the meaning set forth in the recitals to this Supplemental Indenture.

 

(n)                                 “Indenture” has the meaning set forth in the recitals to this Supplemental Indenture.

 

(o)                                 “Initial Floating Interest Rate” has the meaning set forth in clause (d)(1) of Section 2.02 of this Supplemental Indenture.

 

(p)                                 “Issue Date” has the meaning set forth in clause (c) of Section 2.01 of this Supplemental Indenture.

 

(q)                                 “Issuer” has the meaning set forth in the introduction to this Supplemental Indenture.

 

(r)                                    “LIBOR” shall mean, as of any Floating Rate Interest Determination Date:

 

(1) the offered quotation to leading banks in the London interbank market for three-month U.S. dollar deposits (i) as defined by (A) the ICE Benchmark Administration (“IBAM”), (B) its successor in such capacity, or (C) such other person assuming the responsibility of IBAM or its successor in calculating the London Inter-Bank Offered Rate in the event IBAM or its successor no longer do so, and (ii) as calculated by their appointed Calculation Agent and published, as such rate appears on either the Reuters Monitor Money Rates Service page LIBOR01 (or a successor page on such service) or, if such rate is not available, on such other information system that provides such information, in each case as of 11:00 a.m., London time, on such Floating Rate Interest Determination Date;

 

(2) if no such rate is so published on such Floating Rate Interest Determination Date due to a temporary disruption in service or the market, then the rate for such Floating Rate Interest Determination Date shall be the arithmetic mean (rounded to five decimal places, with 0.000005 being rounded upwards) of the rates for three-month U.S. dollar deposits quoted to the Calculation Agent by each of four major reference banks in the London interbank market (which may include affiliates of the underwriters), as selected by the Issuer as of 11:00 a.m., London time, on such Floating Rate Interest Determination Date (it being understood that at least two such quotes must have been so provided to the Calculation Agent); or

 

(3) if LIBOR cannot be determined under sub-paragraph (1) hereof due to the London Inter-Bank Offered Rate having been permanently discontinued or it

 

3

 

being unlawful for either the Calculation Agent or the Issuer to determine or use the London Inter-Bank Offered Rate, then the rate of interest for such Floating Rate Interest Determination Date will be the rate determined for or otherwise applicable during the last preceding interest period.

 

(s)                                   “London Banking Day” means any day on which dealings in U.S. dollars are transacted in the London interbank market.

 

(t)                                    “Notes” has the meaning set forth in the recitals to this Supplemental Indenture.

 

(u)                                 “Regular Record Date” means the fifteenth calendar day, whether or not a Business Day, that precedes the relevant Fixed Rate Interest Payment Date or Floating Rate Interest Payment Date, as applicable.

 

(v)                                 “Trustee” has the meaning set forth in the introduction to this Supplemental Indenture.

 

ARTICLE 2

THE NOTES

 

Section 2.01.                          The following terms relating to the Fixed Rate Notes are hereby established:

 

(a)                                 The title of the Fixed Rate Notes shall be “2.125% Notes due 2020”;

 

(b)                                 The principal amount of the Fixed Rate Notes that may be authenticated and delivered under the Indenture shall not initially exceed $1,200,000,000 (except as otherwise provided in the Indenture);

 

(c)                                  The Fixed Rate Notes shall be issued on November 3, 2017 (the “Issue Date”) and the principal on the Fixed Rate Notes shall be payable on November 3, 2020 (the “Fixed Rate Notes Maturity Date”);

 

(d)                                 Interest on the Fixed Rate Notes shall be payable semi-annually at a rate of 2.125% per annum. Interest will be payable in arrears on May 3 and November 3 of each year, beginning on May 3, 2018 (each, a “Fixed Rate Interest Payment Date”), and on the Fixed Rate Notes Maturity Date, to the person in whose name the Fixed Rate Notes are registered at the close of business on the Regular Record Date. Interest on the Fixed Rate Notes will be calculated as contemplated by Section 3.10 of the Base Indenture.  If any Fixed Rate Interest Payment Date or Redemption Date, or the Fixed Rate Notes Maturity Date, as the case may be, would fall on a day that is not a Business Day, then the Fixed Rate Interest Payment Date or Redemption Date, or the Fixed Rate Notes Maturity Date, as the case may be, will be postponed to the next succeeding Business Day, but no additional interest shall accrue and be paid unless the Issuer fails to make payment on such next succeeding Business Day;

 

(e)                                  No premium, upon redemption or otherwise, shall be payable by the Issuer on the Fixed Rate Notes;

 

(f)                                   Principal of, and any interest on, the Fixed Rate Notes shall be paid to the Holder through the Trustee, having offices in New York, New York;

 

4

 

(g)                                  The Fixed Rate Notes shall not be redeemable except as provided in Section 11.08 of the Base Indenture. The Fixed Rate Notes shall not be redeemable at the option of the Holders at any time;

 

(h)                                 The Issuer shall have no obligation to redeem or purchase the Fixed Rate Notes pursuant to any sinking fund or analogous provision;

 

(i)                                     The Fixed Rate Notes shall be issued only in denominations of $200,000 and integral multiples of $1,000 in excess thereof;

 

(j)                                    The Fixed Rate Notes shall be denominated in U.S. dollars;

 

(k)                                 The payment of principal of, and interest on, the Fixed Rate Notes shall be payable only in the coin or currency in which the Fixed Rate Notes are denominated which, pursuant to clause (j) above, shall be U.S. dollars;

 

(l)                                     The Fixed Rate Notes will be subject to, and each Holder (including each holder of a beneficial interest in the Fixed Rate Notes) acknowledges, accepts, agrees and consents that the Fixed Rate Notes will be subject to, the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority.  Each Holder of Fixed Rate Notes (including each holder of a beneficial interest in the Fixed Rate Notes) acknowledges, accepts, agrees to be bound by and consents to (i) the effect of the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority and (ii) the variation, if necessary, of the terms of the Fixed Rate Notes to give effect to the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority, pursuant to Article Twelve of the Base Indenture;

 

(m)                             The Fixed Rate Notes will be issued in the form of one or more Global Securities in registered form, without coupons attached, and the initial Holder with respect to each such Global Security shall be Cede & Co., as nominee of DTC;

 

(n)                                 Except in limited circumstances, the Fixed Rate Notes will not be issued in definitive form; and

 

(o)                                 The form of the Fixed Rate Notes shall be evidenced by one or more Global Securities in registered form substantially in the form of Exhibit A to this Supplemental Indenture.

 

Section 2.02.                The following terms relating to the Floating Rate Notes are hereby established:

 

(a)                                 The title of Floating Rate Notes shall be “Floating Rate Notes due 2020”;

 

(b)                                 The principal amount of the Floating Rate Notes that may be authenticated and delivered under the Indenture shall not initially exceed $300,000,000 (except as otherwise provided in the Indenture);

 

(c)                                  The Floating Rate Notes shall be issued on the Issue Date and the principal on the Floating Rate Notes shall be payable on November 3, 2020 (the “Floating Rate Notes Maturity Date”);

 

(d)                                 (1) Interest on the Floating Rate Notes shall be payable quarterly at a rate equal to LIBOR plus 0.300% per annum. Interest will be payable quarterly in arrears on February 3, May 3, August 3 and November 3, beginning on February 3, 2018 (each, a “Floating Rate Interest Payment Date”), and the Floating Rate Notes Maturity Date, to the person in whose name the Floating Rate Notes are registered at the close of business on the Regular Record Date. Interest on the Floating Rate Notes

 

5

 

will initially bear interest from and including November 3, 2017, to, but excluding, February 3, 2018 at a rate per year equal to LIBOR plus 0.300% per annum (the “Initial Floating Interest Rate”) as determined by the Calculation Agent. If any Floating Rate Interest Payment Date would fall on a day that is not a Business Day, the Floating Rate Interest Payment Date will be postponed to the next succeeding Business Day and interest thereon will continue to accrue to, but excluding, such succeeding Business Day, except that if that Business Day falls in the next succeeding calendar month, the Floating Rate Interest Payment Date will be the immediately preceding Business Day and interest shall accrue to, but excluding, such preceding Business Day. If the Floating Rate Notes Maturity Date or Redemption Date would fall on a day that is not a Business Day, the payment of interest and principal will be made on the next succeeding Business Day, but no additional interest shall accrue and be paid unless the Issuer fails to make payment on such next succeeding Business Day; (2) The amount of interest accrued on the Floating Rate Notes to each Floating Rate Interest Payment Date will be calculated by multiplying the principal amount of the Floating Rate Notes by an Accrued Interest Factor. The “Accrued Interest Factor” will be equal to the sum of the interest factors calculated for each day in the period for which interest is being paid. The interest factor for each day is equal to the interest rate applicable to that day divided by 360. The interest rate in effect on any Floating Rate Interest Reset Date will be the applicable rate as reset on that date. The interest rate applicable to any other day is the interest rate from the immediately preceding Floating Rate Interest Reset Date, or, if none, the Initial Floating Interest Rate; (3) The interest rate on the Floating Notes shall be reset quarterly on February 3, May 3, August 3 and November 3, beginning on February 3, 2018 (each, a “Floating Rate Interest Reset Date”); provided that the interest rate in effect from and including November 3, 2017, to, but excluding, the first Floating Rate Interest Reset Date, will be the Initial Floating Interest Rate;

 

(e)                                  No premium, upon redemption or otherwise, shall be payable by the Issuer on the Floating Rate Notes;

 

(f)                                   Principal of, and any interest on, the Floating Rate Notes shall be paid to the Holder through the Trustee, having offices in New York, New York;

 

(g)                                  The Floating Rate Notes shall not be redeemable except as provided in Section 11.08 of the Base Indenture. The Floating Rate Notes shall not be redeemable at the option of the Holders at any time;

 

(h)                                 The Issuer shall have no obligation to redeem or purchase the Floating Rate Notes pursuant to any sinking fund or analogous provision;

 

(i)                                     The Floating Rate Notes shall be issued only in denominations of $200,000 and integral multiples of $1,000 in excess thereof;

 

(j)                                    The Floating Rate Notes shall be denominated in U.S. dollars;

 

(k)                                 The payment of principal of, and interest on, the Floating Rate Notes shall be payable only in the coin or currency in which the Floating Rate Notes are denominated which, pursuant to clause (j) above, shall be U.S. dollars;

 

(l)                                     The Floating Rate Notes will be subject to, and each Holder (including each holder of a beneficial interest in the Floating Rate Notes) acknowledges, accepts, agrees and consents that the Floating Rate Notes will be subject to, the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority. Each Holder of Floating Rate Notes (including each holder of a beneficial interest in the Floating Rate Notes) acknowledges, accepts, agrees to be bound by and consents to (i) the effect of the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority and (ii) the variation, if

 

6

 

necessary, of the terms of the Floating Rate Notes to give effect to the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority, pursuant to Article Twelve of the Base Indenture;

 

(m)                             The Floating Rate Notes will be issued in the form of one or more Global Securities in registered form, without coupons attached, and the initial Holder with respect to each such Global Security shall be Cede & Co., as nominee of DTC;

 

(n)                                 Except in limited circumstances, the Floating Rate Notes will not be issued in definitive form; and

 

(o)                                 The form of the Floating Rate Notes shall be evidenced by one or more Global Securities in registered form substantially in the form of Exhibit B to this Supplemental Indenture.

 

ARTICLE 3
 AMENDMENTS TO THE BASE INDENTURE APPLICABLE TO ALL SERIES OF NOTES ISSUED ON OR AFTER THE DATE OF THIS SUPPLEMENTAL INDENTURE

 

Section 3.01.                Section 3.12 of the Base Indenture is amended and restated in its entirety, as follows:

 

Section 3.12.  Additional Senior Debt Securities.  The Issuer may, from time to time, without the consent of the Holders of the Senior Debt Securities of any series, issue additional Senior Debt Securities (“Additional Senior Debt Securities”) of one or more of the series of Senior Debt Securities issued under this Senior Debt Securities Indenture, having the same ranking and same interest rate, Stated Maturity, redemption terms and other terms, except for the price to the public and issue date and first Interest Payment Date, as the Senior Debt Securities; provided however that such Additional Senior Debt Securities shall be issued under a separate CUSIP, Common Code and/or ISIN number unless the Additional Senior Debt Securities are issued pursuant to a “qualified reopening” of the original series, are otherwise treated as part of the same “issue” of debt instruments as the original series, or the original series was issued with no more than a de minimis amount of original issue discount and the Additional Senior Debt Securities are issued with no more than a de minimis amount of original issue discount, in each case for U.S. federal income tax purposes. Any such Additional Senior Debt Securities, together with the Senior Debt Securities of the applicable series, will constitute a single series of Senior Debt Securities under this Senior Debt Securities Indenture and shall be included in the definition of “Senior Debt Securities” in this Senior Debt Securities Indenture where the context requires.

 

Section 3.02.                Article Six of the Base Indenture is amended by amending and restating Section 6.07 in its entirety, which shall read as follows:

 

Section 6.07.  Compensation and Reimbursement.

 

(a)               The Issuer agrees:

 

(i)                   to pay to the Trustee from time to time compensation for all services rendered by it hereunder as agreed upon in writing by the Issuer from time to time (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust);

 

(ii)                except as otherwise expressly provided herein, to reimburse the Trustee upon its request for all reasonable expenses, disbursements and advances incurred or made by the Trustee in accordance with any provision of this Senior Debt Securities Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such

 

7

 

expense, disbursement or advance as shall be determined by a court of competent jurisdiction to have been caused by its own negligence or willful misconduct; and

 

(iii)             to indemnify the Trustee for, and to hold it harmless against, any and all loss, liability, claim, damage or expense (including legal fees and expenses) incurred without negligence or willful misconduct on its part, arising out of or in connection with the acceptance or administration of the trust or trusts hereunder including the costs and expenses of defending itself against any claim (whether asserted by the Issuer, a Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder but excluding any tax liabilities of the Trustee in respect of its income, profits or gains.

 

The Trustee shall notify the Issuer in writing of the commencement of any action or claim in respect of which indemnification may be sought promptly after a Responsible Officer of the Trustee becomes aware of such commencement (provided that the failure to make such notification shall not affect the Trustee’s rights hereunder) and the Issuer shall be entitled to participate in, and to the extent it shall wish, to assume the defense thereof, including the employment of counsel reasonably satisfactory to the Trustee.  If the Issuer and the Trustee are being represented by the same counsel and the Issuer has assumed the defense of the claim, the Trustee shall not be authorized to settle a claim without the written consent of the Issuer, which consent shall not be unreasonably withheld.

 

If the Trustee is represented by separate counsel due to a conflict of interest or its need for separate representation due to a need to assert defenses which are different from the Issuer’s, in the Trustee’s sole discretion, the Trustee shall be entitled to enter into any settlement without the written consent of the Issuer and any and all fees, costs and expenses of such separate legal representation of the Trustee will be paid by the Issuer.

 

As security for the performance of the obligations of the Issuer under this Section, the Trustee shall have a senior lien to which the Senior Debt Securities are hereby made subordinate, upon all property and funds held or collected by the Trustee as such, except funds held in trust for the payment of principal of (or premium, if any) or interest, if any, on the Senior Debt Securities.

 

The provisions of this Section 6.07 shall survive the termination of this Senior Debt Securities Indenture or the earlier resignation or removal of the Trustee.

 

(b)              To the extent that (x) the Issuer’s obligations to reimburse and indemnify the Trustee (and each agent, custodian and other Person employed to act hereunder) pursuant to this Section 6.07 (or any other agreement entered into in connection with the Senior Debt Securities) are liabilities under the Banking Act 2009 that are not excluded liabilities or otherwise excluded from bail-in by legislation, rule, regulation or regulatory technical standard or any other exemption therefrom or amendment thereto and (y) the Relevant UK Resolution Authority has exercised any UK Bail-in Power in whole or in part with respect to such liabilities, notwithstanding any other term of the Senior Debt Securities or this Senior Debt Securities Indenture or any other agreements, arrangements or understandings between the Issuer and the Trustee (and each agent, custodian and other Person employed to act hereunder), the Trustee (and each agent, custodian and other Person employed to act hereunder) acknowledge, agree to be bound by and consent to the effect of the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority in relation to the obligations of the Issuer to the Trustee (and each agent, custodian and other Person employed to act hereunder) under this Section 6.07 (or any other agreement entered into in connection with the Senior Debt Securities).

 

8

 

To the extent that the Issuer’s obligations to reimburse and indemnify the Trustee are liabilities of the type listed in section 48B(7A) of the Banking Act 2009 or in any other exemption or amendment thereto, the Issuer’s obligations to reimburse and indemnify the Trustee in accordance with this Section 6.07 shall survive any exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

(c)               Other than in circumstances where the Relevant UK Resolution Authority has exercised the UK Bail-in Power, in whole or in part with respect to the Senior Debt Securities, the accrued obligations of the Issuer under this Section 6.07 to compensate and indemnify the Trustee for expenses, losses, claims damages, liabilities, disbursements and advances shall survive the termination, satisfaction and discharge of this Senior Debt Securities Indenture, including any termination under any applicable bankruptcy or similar law or the removal or resignation of the Trustee.

 

(d)              It is the intention of the parties hereto that the Issuer’s obligations to indemnify the Trustee in accordance with this Section 6.07 shall survive any exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

Section 3.03.                          Section 8.01 of the Base Indenture is amended by amending and restating Section 8.01(a) in its entirety, which shall read as follows:

 

(a)               the corporation formed by such consolidation or amalgamation or into which the Issuer is merged or the Person which acquires by conveyance or transfer the properties and assets of the Issuer substantially as an entirety (i) shall be a company organized and existing under the laws of England and Wales, the laws of any member state of the European Union (as the same may be constituted from time to time), the laws of any state of the United States, the laws of any province of Canada, the laws of Australia or the laws of New Zealand, and (ii) shall expressly assume, by an indenture supplemental hereto, executed and delivered to the Trustee, in form satisfactory to the Trustee, the due and punctual payment of the principal of (and premium, if any) and interest, if any, on all the Securities in accordance with the provisions of such Securities and this Securities Indenture and the performance of every covenant of this Securities Indenture on the part of the Issuer to be performed or observed;

 

ARTICLE 4
 MISCELLANEOUS

 

Section 4.01.                                    Effect of this Supplemental Indenture; Ratification and Integral Part.  This Supplemental Indenture shall become effective upon its execution and delivery.

 

Except as hereby expressly amended with respect to the Notes only, the Base Indenture is in all respects ratified and confirmed and all the terms, provisions and conditions thereof shall be and remain in full force and effect. This Supplemental Indenture shall be deemed an integral part of the Base Indenture in the manner and to the extent herein and therein provided.

 

Section 4.02.                                    Responsibility for Recitals, Etc.  The recitals herein shall be taken as the statements of the Issuer, and the Trustee assumes no responsibility for the correctness thereof. The Trustee makes no representations as to the validity or sufficiency of this Supplemental Indenture.

 

9

 

Section 4.03.                                    Priority.  This Supplemental Indenture shall be deemed part of the Base Indenture in the manner and to the extent herein and therein provided. The provisions of this Supplemental Indenture shall, with respect to the Notes and subject to the terms hereof, supersede the provisions of the Base Indenture to the extent the Base Indenture is inconsistent herewith.

 

Section 4.04.                                    Governing Law.  This Supplemental Indenture shall be governed by, and construed in accordance with, the laws of the State of New York, except that the authorization and execution of this Supplemental Indenture shall be governed (in addition to the laws of the State of New York relevant to execution) by the respective jurisdictions of the Issuer and the Trustee, as the case may be.

 

Section 4.05.                                    Counterparts.  This 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. The exchange of copies of this Supplemental Indenture and of signature pages by facsimile or PDF transmission shall constitute effective execution and delivery of this Supplemental Indenture as to the parties hereto and may be used in lieu of the original Supplemental Indenture and signature pages for all purposes.

 

Section 4.06.                                    Entire Agreement.  This Supplemental Indenture constitutes the entire agreement of the parties hereto with respect to the amendments to the Base Indenture set forth herein.

 

Section 4.07.                          U.S.A. Patriot Act.  The parties hereto acknowledge that in accordance with Section 326 of the U.S.A. Patriot Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee.  The parties to this Supplemental Indenture agree that they will provide the Trustee with such information as it may request in order for the Trustee to satisfy the requirements of the U.S.A. Patriot Act.

 

[Remainder of page intentionally left blank]

 

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

 

	
 
    	
SANTANDER UK PLC
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
/s/ J Wainwright 
    
	
 
    	
 
    	
Name: J Wainwright
    
	
 
    	
 
    	
Title: Authorised Signatory
    
	
 
    	
 
    	
 
    
	
 
    	
WELLS FARGO BANK, NATIONAL ASSOCIATION, as Trustee
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/ Stefan Victory 
    
	
 
    	
 
    	
Name: Stefan Victory
    
	
 
    	
 
    	
Title: Vice President
    

 

11

 

EXHIBIT A

 

FORM OF FIXED RATE NOTE

 

This Security is in global form within the meaning of the Senior Debt Securities Indenture hereinafter referred to and is registered in the name of The Depository Trust Company, a New York corporation (“DTC”), or a nominee of DTC, which may be treated by the Issuer, the Trustee and any agent thereof as owner and holder of this Security for all purposes.

 

Notwithstanding any other term of the Securities represented by this Global Security or the Senior Debt Securities Indenture (as defined herein) or any other agreements, arrangements or understandings between the Issuer and any Holder (including for these purposes each holder of a beneficial interest in the Securities), by its acquisition of the Securities, each Holder of the Securities acknowledges, accepts, agrees to be bound by and consents to:  (a) the effect of the exercise of any UK Bail-in Power (as defined herein) by the Relevant UK Resolution Authority (as defined herein), whether or not imposed with prior notice, that may include and result in:  (i) the reduction of all, or a portion, of the Amounts Due (as defined herein); (ii) the conversion of all, or a portion, of the Amounts Due on the Securities into the Issuer’s or another Person’s shares, other securities or other obligations (and the issue to or conferral on the Holder of the Securities of such shares, other securities or other obligations) including by means of an amendment, modification or variation of the terms of the Securities; (iii) the cancellation of the Securities; and/or (iv) the amendment or alteration of the maturity of the Securities or the amount of interest payable on the Securities, or the date on which the interest becomes payable, including by suspending payment for a temporary period; and (b) the variation, if necessary, of the terms of the Senior Debt Securities Indenture or the Securities to give effect to the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

Unless this certificate is presented by an authorized representative of DTC to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

 

Unless and until it is exchanged in whole or in part for Securities in definitive form in the limited circumstances referred to in the Senior Debt Securities Indenture, this Global Security may not be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC or any such nominee to a successor depositary or a nominee of such successor depositary.

 

A-1

 

	
Registered   No. [  ]
    	
Principal Amount: $[  ]
    
	
CUSIP:   80283L AP8  
    	
 
    
	
ISIN:   US80283LAP85
    	
 
    

 

SANTANDER UK PLC

 

2.125% Notes due 2020

 

Santander UK plc, a public limited company incorporated in England and Wales (hereinafter called the “Issuer,” which term shall include any successor entity under the Senior Debt Securities Indenture), for value received, hereby promises to pay to Cede & Co., as nominee for DTC, or registered assigns, upon presentation, the principal sum of [    ] ($[    ] [    ]) on November 3, 2020 (the “Maturity Date”) and to pay interest thereon from November 3, 2017, or from the most recent interest payment date to which interest has been paid or duly provided for, semi-annually in arrears on May 3 and November 3 in each year (each, an “Interest Payment Date”), and on the Maturity Date, commencing on May 3, 2018, at the rate of 2.125% per annum, until the entire 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 will, as provided in the Senior Debt Securities Indenture, be paid to the Person in whose name this Security is registered at the close of business on the Regular Record Date for such interest, which shall be the fifteenth calendar day (whether or not a Business Day) preceding the related 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 Security is registered at the close of business on a Special Record Date for the payment of Defaulted Interest to be fixed by the Issuer, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Senior Debt Securities Indenture.

 

Payment of the principal of and interest on and any Additional Amounts in respect of this Global Security will be paid to DTC for the purpose of permitting DTC to credit the principal and interest received by it in respect of this Global Security to the accounts of the beneficial owners thereof; provided, however, that if this Security is not a Global Security, payment of the principal of, interest on and Additional Amounts, if any, in respect of this Security will be made at the office or agency of the Trustee in The City of New York, or elsewhere as provided in the Senior Debt Securities Indenture, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; and provided, further, that at the option of the Issuer payment of interest may be made by (a) check mailed to the address of the Person entitled thereto as such address shall appear in the Register or (b) transfer to an account of the Person entitled thereto located inside the United States.

 

If an Interest Payment Date or Redemption Date, or the Maturity Date, as the case may be, would fall on a day that is not a Business Day, then the Interest Payment Date, Redemption Date or the Maturity Date, as the case may be, will be postponed to the next succeeding Business Day, but no additional interest shall be paid unless the Issuer fails to make payment on such next succeeding Business Day.

 

All amounts of principal, and premium, if any, and interest, on the Securities will be paid by the Issuer without deduction or withholding for, or on account of, any and all present and future income, stamp and other taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“Taxes”) now or hereafter imposed, levied, collected, withheld or assessed by or on behalf of the country in which the Issuer is organized or any political subdivision or authority thereof or therein having the power to tax (the “Taxing Jurisdiction”), unless such deduction or withholding is required 

 

A-2

 

by fiscal or other laws, regulations and directives.  For the purposes of this Security, the phrase “fiscal or other laws, regulations and directives” shall include any obligation of the Issuer to withhold or deduct from a payment pursuant to an agreement described in Section 1471(b) of the Internal Revenue Code of 1986, as amended (the “Code”) or otherwise imposed pursuant to Sections 1471 through 1474 of the Code, any regulations thereunder or official interpretations thereof or any law implementing an intergovernmental approach thereto (collectively, “FATCA”).  If deduction or withholding of any such Taxes shall at any time be required by the Taxing Jurisdiction, the Issuer will pay such additional amounts of, or in respect of, the principal amount of, premium, if any, and interest, on the Securities (“Additional Amounts”) as may be necessary in order that the net amounts paid to the Holders of the Securities, after such deduction or withholding, shall equal the respective amounts of principal, premium, if any, and interest, which would have been payable in respect of the Securities had no such deduction or withholding been required; provided, however, that the foregoing will not apply to any such Tax which would not have been payable or due but for the fact that:

 

(i) the Holder or the beneficial owner of this Security is a domiciliary, national or resident of, or engaging in business or maintaining a permanent establishment or physically present in, the Taxing Jurisdiction or otherwise has some connection with the Taxing Jurisdiction other than the holding or ownership of this Security, or the collection of any payment of (or in respect of) principal of, premium, if any, or interest, on this Security;

 

(ii) except in the case of a winding-up of the Issuer in the United Kingdom, this Security is presented (where presentation is required) for payment in the United Kingdom;

 

(iii) this Security is presented (where presentation is required) for payment more than 30 days after the date payment became due or was provided for, whichever is later, except to the extent that the Holder would have been entitled to such Additional Amount on presenting (where presentation is required) the same for payment at the close of such 30-day period;

 

(iv) the Holder or the beneficial owner of this Security or the beneficial owner of any payment of (or in respect of) principal of, premium, if any, or interest on, this Security failed to comply with a request of the Issuer or its liquidator or other authorized person addressed to the Holder (x) to provide information concerning the nationality, residence or identity of the Holder or such beneficial owner or (y) to make any declaration or other similar claim to satisfy any information requirement, which in the case of (x) or (y), is required or imposed by a statute, treaty, regulation or administrative practice of the Taxing Jurisdiction as a precondition to exemption from all or part of such tax, assessment or other governmental charge; or

 

(v) any combination of subclauses (i) through (iv) above;

 

nor shall Additional Amounts be paid with respect to the principal of, premium, if any, and interest on, the Securities to any holder who is a fiduciary or partnership or settlor with respect to such fiduciary or a member of such partnership other than the sole beneficial owner of such payment to the extent such payment would be required by the laws of any Taxing Jurisdiction to be included in the income for tax purposes of a beneficiary or partner or settlor with respect to such fiduciary or a member of such partnership or a beneficial owner who would not have been entitled to such Additional Amounts, had it been the holder.  For the avoidance of doubt, all payments in respect of the Securities will be made subject to any withholding or deduction required pursuant to any fiscal or other laws, regulations and directives, including FATCA, and the Issuer shall not be required to pay Additional Amounts with respect to the principal of, interest and any other payments on, the Securities on account of any such deduction or withholding required pursuant to FATCA.

 

Whenever in this Security there is mentioned, in any context, the payment of the principal of (and premium, if any) or interest, on, or in respect of, the Securities such mention shall be deemed to include mention of the payment of Additional Amounts provided for herein to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the

 

A-3

 

provisions hereof and as if express mention of the payment of Additional Amounts (if applicable) were made in any provisions hereof where such express mention is not made.

 

A “Business Day” is any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in the City of New York or London, England are authorized or required by law, regulation or executive order to close.

 

Additional provisions of this Security are set forth following the signature page hereof, which 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 or on behalf of the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Senior Debt Securities Indenture or be valid or obligatory for any purpose.

 

[The remainder of this page has been left blank intentionally]

 

A-4

 

IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed this 3rd day of November, 2017

 

	
 
    	
SANTANDER UK PLC
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

CERTIFICATE OF AUTHENTICATION

 

This is one of the Senior Debt Securities of the series designated herein referred to in the within-mentioned Senior Debt Securities Indenture.

 

Dated:

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Trustee

 

	
By:
    	
 
    	
 
    
	
 
    	
Authorized Signatory
    	
 
    

 

A-5

 

2.125% Notes due 2020

 

This Security is one or all of a duly authorized issue of securities of the Issuer (herein called the “Securities”), initially limited in aggregate principal amount to $1,200,000,000, issued and to be issued in one or more series under an Indenture, dated as of September 29, 2016 between the Issuer and Wells Fargo Bank, National Association, as trustee (the “Trustee,” which term includes any successor trustee under the Senior Debt Securities Indenture (as defined below), as successor to Law Debenture Trust Company of New York pursuant to an Agreement of Resignation, Appointment and Acceptance dated as of June 2, 2017 among the Issuer, the Trustee and Law Debenture Trust Company of New York) (the “Original Securities Indenture”), as supplemented and amended by the First Supplemental Indenture, dated as of November 3, 2017 (the “First Supplemental Indenture” and, together with the Original Securities Indenture, the “Senior Debt Securities Indenture”) between the Issuer and the Trustee, to which Senior Debt Securities Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitation of rights, duties and immunities thereunder of the Issuer, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one or all of the series designated as the “2.125% Notes due 2020.” All terms used in this Security that are defined in the Senior Debt Securities Indenture and not otherwise defined herein shall have the meanings assigned to them in the Senior Debt Securities Indenture.

 

As provided in and subject to the provisions of the Senior Debt Securities Indenture, the Issuer will have the option to redeem the Securities in whole on any Interest Payment Date, at a redemption price equal to 100% of the principal amount, together with accrued but unpaid interest, if any, in respect of the Securities to the date fixed for redemption (or, in the case of Original Issue Discount Securities, the accreted face amount thereof, together with accrued interest, if any), if, at any time, the Issuer shall determine that as a result of a change in or amendment to the laws or regulations of the Taxing Jurisdiction (including any treaty to which such Taxing Jurisdiction is a party), or, based upon a written legal opinion of independent United Kingdom counsel of recognized standing as set forth in the Senior Debt Securities Indenture, any change in the official application or interpretation of such laws or regulations (including a decision of any court or tribunal) which change or amendment becomes effective on or after a date included in the terms of such Securities:

 

(a) in making payment under the Securities in respect of principal or premium, if any, or interest, if any, it has or will or would on the next Interest Payment Date become obligated to pay Additional Amounts;

 

(b) any payment of Interest on an Interest Payment Date in respect of the Securities has been treated as a “distribution”, or the payment of interest on the next Interest Payment Date in respect of any of the Securities would be treated as a “distribution,” in each case within the meaning of Section 1000 of the Corporation Tax Act 2010 of the United Kingdom (or any statutory modification or re-enactment thereof for the time being); or

 

(c) on an Interest Payment Date the Issuer was not entitled, or on the next Interest Payment Date the Issuer would not be entitled, to claim a deduction in respect of such payment of interest in computing its United Kingdom taxation liabilities (or the value of such deduction to the Issuer would be materially reduced).

 

In the event of a redemption as described in the paragraphs above, notice of such redemption to the Holders of the Securities of any series to be redeemed in whole but not in part at the option of the Issuer shall be given by mailing notice of such redemption by first class mail, postage prepaid, at least 30 days and not more than 60 days prior to the date fixed for redemption to such Holders of the Securities of such series at their last addresses as they shall appear upon the Register of the Issuer.

 

A-6

 

The Senior Debt Securities Indenture contains provisions for satisfaction and discharge of the Senior Debt Securities Indenture applicable to the Issuer upon compliance by the Issuer with certain conditions set forth in the Senior Debt Securities Indenture, which provisions apply to this Security.

 

If an Event of Default with respect to the Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Senior Debt Securities Indenture.

 

As provided in and subject to the provisions of the Senior Debt Securities Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Senior Debt Securities Indenture or for the appointment of an administrator, receiver or trustee or for any other remedy thereunder, unless such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to such Security specifying such Event of Default and stating that such notice is a “Notice of Default” under the Senior Debt Securities Indenture; the Holders of not less than 25% in aggregate principal amount of such Security shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name, as Trustee hereunder; such Holders have offered to the Trustee reasonable indemnity or security satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request; the Trustee for 60 days after its receipt of such notice, request and offer of indemnity or security has failed to institute any such proceeding; and no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of such Security.  The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or interest hereon on or after the respective due dates expressed herein.

 

The Senior Debt Securities Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Securities under the Senior Debt Securities Indenture at any time by the Issuer and the Trustee with the consent of the Holders of not less than a majority in principal amount of the outstanding Securities affected by such amendment.  The Senior Debt Securities Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities at the time outstanding, on behalf of the Holders of all Securities, to waive compliance by the Issuer with certain provisions of the Senior Debt Securities Indenture and certain past defaults under the Senior Debt Securities Indenture and their consequences.  Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security 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 Security.

 

No reference herein to the Senior Debt Securities Indenture and no provision of this Security or of the Senior Debt Securities Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

The Issuer may, from time to time, without the consent of the Holders of the Securities, issue additional Securities of this series having the same ranking and same interest rate, Stated Maturity, redemption terms and other terms, except for the price to the public and issue date and first Interest Payment Date, as this Security; provided however that such additional Securities shall be issued under a separate CUSIP, Common Code and/or ISIN number unless the additional Securities are issued pursuant to a “qualified reopening” of the original series, are otherwise treated as part of the same “issue” of debt instruments as the original series, or the original series was issued with no more than a de minimis amount of original issue discount and the additional Securities are issued with no more than a de minimis amount of original issue discount, in each case for U.S. federal income tax purposes. Any such additional Securities, together with this Security, will constitute a single series of Senior Debt Securities under the Senior Debt Securities Indenture.

 

A-7

 

As provided in the Senior Debt Securities Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Register, upon surrender of this Security for registration of transfer at the office or agency of the Issuer in any place of payment where the principal of and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Registrar duly executed by the registered Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities of this series, of authorized denominations containing identical terms and provisions, of a like aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Securities of this series are issuable only in registered form without coupons in denominations of $200,000 and integral multiples of $1,000 in excess thereof.  As provided in the Senior Debt Securities Indenture and subject to certain limitations set forth therein, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series 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, subject to certain exceptions set forth in the Senior Debt Securities Indenture, the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of this Security for registration of transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and none of the Issuer, the Trustee or any such agent shall be affected by notice to the contrary.

 

The obligations of the Issuer under the Senior Debt Securities Indenture and this Security and all documents delivered in the name of the Issuer in connection herewith and therewith do not and shall not constitute personal obligations of the directors, officers, employees, agents or shareholders of the Issuer or any of them, and shall not involve any claim against or personal liability on the part of any of them, and all persons including the Trustee shall look solely to the assets of the Issuer for the payment of any claim thereunder or for the performance thereof and shall not seek recourse against such directors, officers, employees, agents or shareholders of the Issuer or any of them or any of their personal assets for such satisfaction.  The performance of the obligations of the Issuer under the Senior Debt Securities Indenture and this Security and all documents delivered in the name of the Issuer in connection therewith shall not be deemed a waiver of any rights or powers of the Issuer or its directors or shareholders under the Issuer’s Memorandum and Articles of Association.

 

Notwithstanding any other term of the Securities or the Senior Debt Securities Indenture or any other agreements, arrangements or understandings between the Issuer and any Holder of the Securities (including for these purposes each holder of a beneficial interest in the Securities), by its acquisition of the Securities, each Holder of the Securities acknowledges, accepts, agrees to be bound by and consents to:

 

(a) the effect of the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority, whether or not imposed with prior notice, that may include and result in:  (i) the reduction of all, or a portion, of the Amounts Due; (ii) the conversion of all, or a portion, of the Amounts Due on the Securities into the Issuer’s or another Person’s shares, other securities or other obligations (and the issue to or conferral on the Holder of the Securities of such shares, other securities or other obligations) including by means of an amendment, modification or variation of the terms of the Securities; (iii) the cancellation of the Securities; and/or (iv) the amendment or alteration of the maturity of the Securities or the amount of interest payable on the Securities, or the date on which the interest becomes payable, including by suspending payment for a temporary period; and

 

(b) the variation, if necessary, of the terms of the Senior Debt Securities Indenture or the Securities to give effect to the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

A-8

 

No Amounts Due on the Securities will become due and payable or be paid after the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority if and to the extent such Amounts Due have been reduced, converted, cancelled, amended or altered as a result of such exercise.

 

Notwithstanding any other provision of the Senior Debt Securities Indenture or the Securities, neither a reduction or cancellation, in part or in full, of the Amounts Due, the conversion thereof into another security or obligation of the Issuer or another Person, as a result of the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Issuer, nor the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities will be an Event of Default.

 

By its acquisition of the Securities, each Holder of the Securities (which for these purposes includes each holder of a beneficial interest in the Securities):

 

(i) to the extent permitted by the Trust Indenture Act, waives any and all claims, in law and/or in equity, against the Trustee for, agrees not to initiate a suit against the Trustee in respect of, and agrees that the Trustee will not be liable for, any action that the Trustee takes, or abstains from taking, in either case in accordance with the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities;

 

(ii) acknowledges and agrees that neither a cancellation or deemed cancellation of the principal or interest (in each case, in whole or in part), nor the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities will give rise to a default for purposes of Section 315(b) (Notice of Default) and Section 315(c) (Duties of the Trustee in Case of Default) of the Trust Indenture Act; and

 

(iii) acknowledges and agrees that, upon the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority:

 

(A) the Trustee shall not be required to take any further directions from the Holders of the Securities with respect to any portion of the Securities that are written-down, converted to equity and/or cancelled under Section 5.12 of the Senior Debt Securities Indenture, and

 

(B) the Senior Debt Securities Indenture shall not impose any duties upon the Trustee whatsoever with respect to the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

Notwithstanding clauses (i) - (iii) above, if, following the completion of the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority, the Securities remain Outstanding (for example, if the exercise of the UK Bail-in Power results in only a partial write-down of the principal of the Securities), then the Trustee’s duties under the Senior Debt Securities Indenture shall remain applicable with respect to such Securities following such completion to the extent the Issuer and the Trustee shall agree pursuant to a supplemental indenture or an amendment to the Senior Debt Securities Indenture; provided, however, that, notwithstanding the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority, so long as the Securities remain Outstanding, there will at all times be a Trustee for the Securities in accordance with, Section 6.09 of the Senior Debt Securities Indenture, and the resignation and/or removal of the Trustee and the appointment of a successor Trustee will continue to be governed by Sections 6.10 and 6.11 of the Senior Debt Securities Indenture, respectively, including to the extent no additional supplemental indenture or amendment is agreed upon in the event the Securities remain Outstanding following the completion of the exercise of the Bail-in Power.

 

Upon the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities, the Issuer will provide a written notice to DTC as soon as practicable regarding such exercise of the UK Bail-in Power for the purposes of notifying the Holders of such

 

A-9

 

occurrence. The Issuer will also deliver a copy of such notice to the Trustee for information purposes. Each Holder of the Securities (including for these purposes each holder of a beneficial interest in the Securities) shall be deemed to have authorized, directed and requested DTC and any direct participant in DTC or other intermediary through which it holds the Securities to take any and all necessary action, if required, to implement the exercise of the UK Bail-in Power with respect to the Securities as it may be imposed, without any further action or direction on the part of such Holder, the Trustee or the Paying Agent.

 

“UK Bail-in Power” means any write-down, conversion, transfer, modification or suspension power existing from time to time under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in the United Kingdom, relating to the transposition of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms as amended from time to time (“BRRD”), including but not limited to the UK Banking Act 2009, as the same may be amended from time to time including by the Financial Services (Banking Reform) Act 2013 and the instruments, rules and standards created thereunder, pursuant to which: (i) any obligation of a Regulated Entity (or other affiliate of such Regulated Entity) can be reduced, cancelled, modified, or converted into shares, other securities or other obligations of such Regulated Entity or any other Person (or suspended for a temporary period); and (ii) any right in a contract governing an obligation of a Regulated Entity may be deemed to have been exercised.

 

“Regulated Entity” means any BRRD undertaking as such term is defined under the PRA Rulebook promulgated by the United Kingdom Prudential Regulation Authority, as amended from time to time, which includes, certain credit institutions, investment firms, and certain of their parent or holding companies.

 

“Relevant UK Resolution Authority” means the Bank of England or any other authority with the ability to exercise a UK Bail-in Power.

 

“Amounts Due” means the principal amount of, and accrued but unpaid interest, including any Additional Amounts due on, the debt securities. References to principal and interest will include payments of principal and interest that have become due and payable but which have not been paid, prior to the exercise of any UK bail-in power by the Relevant UK Resolution Authority.

 

The Senior Debt Securities Indenture and the Securities, including this Security, shall be governed by and construed in accordance with the law of the State of New York.

 

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused “CUSIP” numbers to be printed on the Securities as a convenience to the Holders of the Securities.  No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be placed only on the other identification numbers printed hereon.

 

A-10

 

ASSIGNMENT FORM

 

FOR VALUE RECEIVED, the undersigned hereby
 sells, assigns and transfers unto

 

PLEASE INSERT SOCIAL

SECURITY OR OTHER IDENTIFYING

NUMBER OF ASSIGNEE

 

	
 
    	
 
    
	
 
    	
 
    
	
 
    	
 
    

(Please Print or Typewrite Name and Address, including Zip Code, of Assignee)

 

	
 
    

the within Security of the company and                          hereby does irrevocably constitute and appoint

 

	
 
    

attorney to transfer said Security on the books of the within-named company with full power of substitution in the premises.

	
 
    	
 
    
	
Dated:
    	
 
    
	
 
    	
 
    
	
Signature
    	
 
    
			

 

NOTICE: The signature to this assignment must correspond with the name as it appears on the first page of the within Security in every particular, without alteration or enlargement or any change whatever.

 

	
Signature Guaranteed:
    	
 
    

 

NOTICE: Signature(s) must be guaranteed by an “eligible guarantor institution” that is a member or participant in a “signature guarantee program” (e.g., the Securities Transfer Agents Medallion Program, the Stock Exchange Medallion Program and the New York Stock Exchange Medallion Program).

 

A-11

 

EXHIBIT B

 

FORM OF FLOATING RATE NOTE

 

This Security is in global form within the meaning of the Senior Debt Securities Indenture hereinafter referred to and is registered in the name of The Depository Trust Company, a New York corporation (“DTC”), or a nominee of DTC, which may be treated by the Issuer, the Trustee and any agent thereof as owner and holder of this Security for all purposes.

 

Notwithstanding any other term of the Securities represented by this Global Security or the Senior Debt Securities Indenture (as defined herein) or any other agreements, arrangements or understandings between the Issuer and any Holder (including for these purposes each holder of a beneficial interest in the Securities), by its acquisition of the Securities, each Holder of the Securities acknowledges, accepts, agrees to be bound by and consents to: (a) the effect of the exercise of any UK Bail-in Power (as defined herein) by the Relevant UK Resolution Authority (as defined herein), whether or not imposed with prior notice, that may include and result in: (i) the reduction of all, or a portion, of the Amounts Due (as defined herein); (ii) the conversion of all, or a portion, of the Amounts Due on the Securities into the Issuer’s or another Person’s shares, other securities or other obligations (and the issue to or conferral on the Holder of the Securities of such shares, other securities or other obligations) including by means of an amendment, modification or variation of the terms of the Securities; (iii) the cancellation of the Securities; and/or (iv) the amendment or alteration of the maturity of the Securities or the amount of interest payable on the Securities, or the date on which the interest becomes payable, including by suspending payment for a temporary period; and (b) the variation, if necessary, of the terms of the Senior Debt Securities Indenture or the Securities to give effect to the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

Unless this certificate is presented by an authorized representative of DTC to the Issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or in such other name as is requested by an authorized representative of DTC (and any payment is made to Cede & Co. or to such other entity as is requested by an authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

 

Unless and until it is exchanged in whole or in part for Securities in definitive form in the limited circumstances referred to in the Senior Debt Securities Indenture, this Global Security may not be transferred except as a whole by DTC to a nominee of DTC or by a nominee of DTC to DTC or another nominee of DTC or by DTC or any such nominee to a successor depositary or a nominee of such successor depositary.

 

B-1

 

	
Registered No. [      ]
    	
 
    	
Principal Amount: $[    ]
    
	
CUSIP: 80283L AQ6
    ISIN: US80283LAQ68
    	
 
    	
 
    

 

SANTANDER UK PLC

 

Floating Rate Notes due 2020

 

Santander UK plc, a public limited company incorporated in England and Wales (hereinafter called the “Issuer,” which term shall include any successor entity under the Senior Debt Securities Indenture), for value received, hereby promises to pay to Cede & Co., as nominee for DTC, or registered assigns, upon presentation, the principal sum of [   ] ($[   ]) on November 3, 2020 (the “Maturity Date”) and to pay interest thereon from November 3, 2017, or from the most recent interest payment date to which interest has been paid or duly provided for, quarterly in arrears on February 3, May 3, August 3 and November 3 in each year (each, an “Interest Payment Date”), and on the Maturity Date, commencing on February 3, 2018 to, but excluding, the next Interest Payment Date or Maturity Date, as the case may be.  This Security will bear interest from November 3, 2017, to, but excluding, February 3, 2018, at an initial interest rate of LIBOR (as defined on the reverse hereof) plus 0.300% per annum and thereafter at an interest rate that will be reset quarterly on February 3, May 3, August 3 and November 3 of each year (each, an “Interest Reset Date”), commencing February 3, 2018, equal to LIBOR plus 0.300% per annum, until the entire 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 will, as provided in the Senior Debt Securities Indenture, be paid to the Person in whose name this Security is registered at the close of business on the Regular Record Date for such interest, which shall be the fifteenth calendar day (whether or not a Business Day) preceding the related 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 Security is registered at the close of business on a Special Record Date for the payment of Defaulted Interest to be fixed by the Issuer, or may be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, all as more fully provided in the Senior Debt Securities Indenture.

 

Payment of the principal of and interest on and any Additional Amounts in respect of this Global Security will be paid to DTC for the purpose of permitting DTC to credit the principal and interest received by it in respect of this Global Security to the accounts of the beneficial owners thereof; provided, however, that if this Security is not a Global Security, payment of the principal of, interest on and Additional Amounts, if any, in respect of this Security will be made at the office or agency of the Trustee in The City of New York, or elsewhere as provided in the Senior Debt Securities Indenture, in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts; and provided, further, that at the option of the Issuer payment of interest may be made by (a) check mailed to the address of the Person entitled thereto as such address shall appear in the Register or (b) transfer to an account of the Person entitled thereto located inside the United States.

 

If any Interest Payment Date for this Security would fall on a day that is not a Business Day, then the Interest Payment Date will be postponed to the next succeeding Business Day and interest thereon will continue to accrue to but excluding such succeeding Business Day, except that if that Business Day falls in the next succeeding calendar month, the Interest Payment Date will be the immediately preceding Business Day and interest thereon will accrue to but excluding such preceding Business Day.  If the Maturity Date or Redemption Date would fall on a day that is not a Business 

 

B-2

 

Day, then the payment of interest and principal will be made on the next succeeding Business Day,  but no additional interest shall be paid unless the Issuer fails to make payment on such next succeeding Business Day.

 

If any Interest Reset Date would fall on a day that is not a Business Day, the Interest Reset Date will be postponed to the next succeeding Business Day, except that if that Business Day falls in the next succeeding calendar month, the Interest Reset Date will be the immediately preceding Business Day.

 

All amounts of principal, and premium, if any, and interest, on the Securities will be paid by the Issuer without deduction or withholding for, or on account of, any and all present and future income, stamp and other taxes, levies, imposts, duties, charges, fees, deductions or withholdings (“Taxes”) now or hereafter imposed, levied, collected, withheld or assessed by or on behalf of the country in which the Issuer is organized or any political subdivision or authority thereof or therein having the power to tax (the “Taxing Jurisdiction”), unless such deduction or withholding is required by fiscal or other laws, regulations and directives.  For the purposes of this Security, the phrase “fiscal or other laws, regulations and directives” shall include any obligation of the Issuer to withhold or deduct from a payment pursuant to an agreement described in Section 1471(b) of the Internal Revenue Code of 1986, as amended (the “Code”) or otherwise imposed pursuant to Sections 1471 through 1474 of the Code, any regulations thereunder or official interpretations thereof or any law implementing an intergovernmental approach thereto (collectively, “FATCA”).  If deduction or withholding of any such Taxes shall at any time be required by the Taxing Jurisdiction, the Issuer will pay such additional amounts of, or in respect of, the principal amount of, premium, if any, and interest, on the Securities (“Additional Amounts”) as may be necessary in order that the net amounts paid to the Holders of the Securities, after such deduction or withholding, shall equal the respective amounts of principal, premium, if any, and interest, which would have been payable in respect of the Securities had no such deduction or withholding been required; provided, however, that the foregoing will not apply to any such Tax which would not have been payable or due but for the fact that:

 

(i) the Holder or the beneficial owner of this Security is a domiciliary, national or resident of, or engaging in business or maintaining a permanent establishment or physically present in, the Taxing Jurisdiction or otherwise has some connection with the Taxing Jurisdiction other than the holding or ownership of this Security, or the collection of any payment of (or in respect of) principal of, premium, if any, or interest, on this Security;

 

(ii) except in the case of a winding-up of the Issuer in the United Kingdom, this Security is presented (where presentation is required) for payment in the United Kingdom;

 

(iii) this Security is presented (where presentation is required) for payment more than 30 days after the date payment became due or was provided for, whichever is later, except to the extent that the Holder would have been entitled to such Additional Amount on presenting (where presentation is required) the same for payment at the close of such 30-day period;

 

(iv) the Holder or the beneficial owner of this Security or the beneficial owner of any payment of (or in respect of) principal of, premium, if any, or interest on, this Security failed to comply with a request of the Issuer or its liquidator or other authorized person addressed to the Holder (x) to provide information concerning the nationality, residence or identity of the Holder or such beneficial owner or (y) to make any declaration or other similar claim to satisfy any information requirement, which in the case of (x) or (y), is required or imposed by a statute, treaty, regulation or administrative practice of the Taxing Jurisdiction as a precondition to exemption from all or part of such tax, assessment or other governmental charge; or

 

(v) any combination of subclauses (i) through (iv) above;

 

B-3

 

nor shall Additional Amounts be paid with respect to the principal of, premium, if any, and interest on, the Securities to any holder who is a fiduciary or partnership or settlor with respect to such fiduciary or a member of such partnership other than the sole beneficial owner of such payment to the extent such payment would be required by the laws of any Taxing Jurisdiction to be included in the income for tax purposes of a beneficiary or partner or settlor with respect to such fiduciary or a member of such partnership or a beneficial owner who would not have been entitled to such Additional Amounts, had it been the holder.  For the avoidance of doubt, all payments in respect of the Securities will be made subject to any withholding or deduction required pursuant to any fiscal or other laws, regulations and directives, including FATCA, and the Issuer shall not be required to pay Additional Amounts with respect to the principal of, interest and any other payments on, the Securities on account of any such deduction or withholding required pursuant to FATCA.

 

Whenever in this Security there is mentioned, in any context, the payment of the principal of (and premium, if any) or interest, on, or in respect of, the Securities such mention shall be deemed to include mention of the payment of Additional Amounts provided for herein to the extent that, in such context, Additional Amounts are, were or would be payable in respect thereof pursuant to the provisions hereof and as if express mention of the payment of Additional Amounts (if applicable) were made in any provisions hereof where such express mention is not made.

 

A “Business Day” is any day, other than a Saturday or Sunday, that is neither a legal holiday nor a day on which banking institutions in the City of New York or London, England are authorized or required by law, regulation or executive order to close.

 

Additional provisions of this Security are set forth following the signature page hereof, which 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 or on behalf of the Trustee referred to on the reverse hereof by manual signature, this Security shall not be entitled to any benefit under the Senior Debt Securities Indenture or be valid or obligatory for any purpose.

 

[The remainder of this page has been left blank intentionally]

 

B-4

 

IN WITNESS WHEREOF, the Issuer has caused this instrument to be duly executed this 3rd  day of November, 2017

 

	
 
    	
SANTANDER UK PLC
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
Name:
    	
 
    
	
 
    	
Title:
    	
 
    

 

CERTIFICATE OF AUTHENTICATION

 

This is one of the Securities of the series designated herein referred to in the within-mentioned Securities Indenture.

 

Dated:

 

WELLS FARGO BANK, NATIONAL ASSOCIATION,

as Trustee

 

	
By:
    	
 
    	
 
    
	
 
    	
Authorized Signatory
    	
 
    

 

B-5

 

Floating Rate Notes due 2020

 

This Security is one or all of a duly authorized issue of securities of the Issuer (herein called the “Securities”), initially limited in aggregate principal amount to $300,000,000, issued and to be issued in one or more series under an Indenture, dated as of September 29, 2016 between the Issuer and Wells Fargo Bank, National Association, as trustee (the “Trustee,” which term includes any successor trustee under the Senior Debt Securities Indenture (as defined below), as successor to Law Debenture Trust Company of New York pursuant to an Agreement of Resignation, Appointment and Acceptance dated June 2, 2017 among the Issuer, the Trustee and Law Debenture Trust Company of New York) (the “Original Securities Indenture”), as supplemented and amended by the First Supplemental Indenture, dated as of November 3, 2017 (the “First Supplemental Indenture” and, together with the Original Securities Indenture, the “Senior Debt Securities Indenture”) between the Issuer and the Trustee, to which Senior Debt Securities Indenture and all indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitation of rights, duties and immunities thereunder of the Issuer, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered. This Security is one or all of the series designated as the “Floating Rate Notes due 2020.” All terms used in this Security that are defined in the Senior Debt Securities Indenture and not otherwise defined herein shall have the meanings assigned to them in the Senior Debt Securities Indenture.

 

The calculation agent, who shall be Wells Fargo Bank, National Association, or its successor appointed by the Issuer, will determine the initial interest rate by reference to LIBOR on the second London Banking Day preceding the issue date and the interest rate for each succeeding Interest Reset Date by reference to LIBOR on the second London Banking Day preceding the applicable Interest Reset Date (each, a “Floating Rate Interest Determination Date”).  Promptly upon such determination, the calculation agent will notify the Issuer and the Trustee (if the calculation agent is not the same entity as the Trustee) of the new interest rate.  Upon the request of a holder of this Security, the calculation agent will provide the interest rate then in effect and, if determined, the interest rate that will become effective on the next Interest Reset Date.

 

A “London Banking Day” means any day on which dealings in U.S. Dollars are transacted in the London interbank market.

 

“LIBOR” shall mean, as of any Floating Rate Interest Determination Date:

 

(1) the offered quotation to leading banks in the London interbank market for three-month U.S. dollar deposits (i) as defined by (A) the ICE Benchmark Administration (“IBAM”), (B) its successor in such capacity, or (C) such other person assuming the responsibility of IBAM or its successor in calculating the London Inter-Bank Offered Rate in the event IBAM or its successor no longer do so, and (ii) as calculated by their appointed Calculation Agent and published, as such rate appears on either the Reuters Monitor Money Rates Service page LIBOR01 (or a successor page on such service) or, if such rate is not available, on such other information system that provides such information, in each case as of 11:00 a.m., London time, on such Floating Rate Interest Determination Date;

 

(2) if no such rate is so published on such Floating Rate Interest Determination Date due to a temporary disruption in service or the market, then the rate for such Floating Rate Interest Determination Date shall be the arithmetic mean (rounded to five decimal places, with 0.000005 being rounded upwards) of the rates for three-month U.S. dollar deposits quoted to the Calculation Agent by each of four major reference banks in the London interbank market (which may include affiliates of the underwriters), as selected by the Issuer, as of 11:00 a.m., London time, on such Floating Rate Interest Determination Date (it being understood that at least two such quotes must have been so provided to the Calculation Agent); or

 

B-6

 

(3) if LIBOR cannot be determined under sub-paragraph (1) hereof due to the London Inter-Bank Offered Rate having been permanently discontinued or it being unlawful for either the Calculation Agent or the Issuer to determine or use the London Inter-Bank Offered Rate, then the rate of interest for such Floating Rate Interest Determination Date will be the rate determined for or otherwise applicable during the last preceding interest period.

 

The amount of interest accrued on this Security to each Interest Payment Date will be calculated by multiplying the principal amount of this Security by an accrued interest factor.  The accrued interest factor will be equal to the sum of the interest factors calculated for each day in the period for which interest is being paid.  The interest factor for each day is equal to the interest rate applicable to that day divided by 360.  The interest rate in effect on any Interest Reset Date will be the applicable rate as reset on that date.  The interest rate applicable to any other day is the interest rate from the immediately preceding Interest Reset Date, or, if none, the initial interest rate.

 

As provided in and subject to the provisions of the Senior Debt Securities Indenture, the Issuer will have the option to redeem the Securities in whole on any Interest Payment Date, at a redemption price equal to 100% of the principal amount, together with accrued but unpaid interest, if any, in respect of the Securities to the date fixed for redemption (or, in the case of Original Issue Discount Securities, the accreted face amount thereof, together with accrued interest, if any), if, at any time, the Issuer shall determine that as a result of a change in or amendment to the laws or regulations of the Taxing Jurisdiction (including any treaty to which such Taxing Jurisdiction is a party), or, based upon a written legal opinion of independent United Kingdom counsel of recognized standing as set forth in the Senior Debt Securities Indenture, any change in the official application or interpretation of such laws or regulations (including a decision of any court or tribunal) which change or amendment becomes effective on or after a date included in the terms of such Securities:

 

(a)  in making payment under the Securities in respect of principal or premium, if any, or interest, if any, it has or will or would on the next Interest Payment Date become obligated to pay Additional Amounts;

 

(b)  any payment of Interest on an Interest Payment Date in respect of the Securities has been treated as a “distribution,” or the payment of interest on the next Interest Payment Date in respect of any of the Securities would be treated as a “distribution,” in each case within the meaning of Section 1000 of the Corporation Tax Act 2010 of the United Kingdom (or any statutory modification or re-enactment thereof for the time being); or

 

(c)  on an Interest Payment Date the Issuer was not entitled, or on the next Interest Payment Date the Issuer  would not be entitled, to claim a deduction in respect of such payment of interest in computing its United Kingdom taxation liabilities (or the value of such deduction to the Issuer would be materially reduced).

 

In the event of a redemption as described in the paragraphs above, notice of such redemption to the Holders of the Securities of any series to be redeemed in whole but not in part at the option of the Issuer shall be given by mailing notice of such redemption by first class mail, postage prepaid, at least 30 days and not more than 60 days prior to the date fixed for redemption to such Holders of the Securities of such series at their last addresses as they shall appear upon the Register of the Issuer.

 

The Senior Debt Securities Indenture contains provisions for satisfaction and discharge of the Senior Debt Securities Indenture applicable to the Issuer upon compliance by the Issuer with certain conditions set forth in the Senior Debt Securities Indenture, which provisions apply to this Security.

 

If an Event of Default with respect to the Securities of this series shall occur and be continuing, the principal of the Securities of this series may be declared due and payable in the manner and with the effect provided in the Senior Debt Securities Indenture.

 

B-7

 

As provided in and subject to the provisions of the Senior Debt Securities Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Senior Debt Securities Indenture or for the appointment of an administrator, receiver or trustee or for any  other remedy thereunder, unless such Holder has previously given written notice to the Trustee of a continuing Event of Default with respect to such Security specifying such Event of Default and stating that such notice is a “Notice of Default” under the Senior Debt Securities Indenture; the Holders of not less than 25% in aggregate principal amount of such Security shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name, as Trustee hereunder; such Holders have offered to the Trustee reasonable indemnity or security satisfactory to it against the costs, expenses and liabilities to be incurred in compliance with such request; the Trustee for 60 days after its receipt of such notice, request and offer of indemnity or security has failed to institute any such proceeding; and no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of such Security.  The foregoing shall not apply to any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or interest hereon on or after the respective due dates expressed herein.

 

The Senior Debt Securities Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Issuer and the rights of the Holders of the Securities under the Senior Debt Securities Indenture at any time by the Issuer and the Trustee with the consent of the Holders of not less than a majority in principal amount of the outstanding Securities affected by such amendment.  The Senior Debt Securities Indenture also contains provisions permitting the Holders of specified percentages in principal amount of the Securities at the time outstanding, on behalf of the Holders of all Securities, to waive compliance by the Issuer with certain provisions of the Senior Debt Securities Indenture and certain past defaults under the Senior Debt Securities Indenture and their consequences.  Any such consent or waiver by the Holder of this Security shall be conclusive and binding upon such Holder and upon all future Holders of this Security and of any Security 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 Security.

 

No reference herein to the Senior Debt Securities Indenture and no provision of this Security or of the Senior Debt Securities Indenture shall alter or impair the obligation of the Issuer, which is absolute and unconditional, to pay the principal of and interest on this Security at the times, place and rate, and in the coin or currency, herein prescribed.

 

The Issuer may, from time to time, without the consent of the Holders of the Securities, issue additional Securities of this series having the same ranking and same interest rate, Stated Maturity, redemption terms and other terms, except for the price to the public and issue date and first Interest Payment Date, as this Security; provided however that such additional Securities shall be issued under a separate CUSIP, Common Code and/or ISIN number unless the additional Securities are issued pursuant to a “qualified reopening” of the original series, are otherwise treated as part of the same “issue” of debt instruments as the original series, or the original series was issued with no more than a de minimis amount of original issue discount and the additional Securities are issued with no more than a de minimis amount of original issue discount, in each case for U.S. federal income tax purposes. Any such additional Securities, together with this Security, will constitute a single series of Senior Debt Securities under the Senior Debt Securities Indenture.

 

As provided in the Senior Debt Securities Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Register, upon surrender of this Security for registration of transfer at the office or agency of the Issuer in any place of payment where the principal of and interest on this Security are payable, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Registrar duly executed by the registered Holder hereof or his attorney duly authorized in writing, and thereupon one or more new

 

B-8

 

Securities of this series, of authorized denominations containing identical terms and provisions, of a like aggregate principal amount, will be issued to the designated transferee or transferees.

 

The Securities of this series are issuable only in registered form without coupons in denominations of $200,000 and integral multiples of $1,000 in excess thereof.  As provided in the Senior Debt Securities Indenture and subject to certain limitations set forth therein, Securities of this series are exchangeable for a like aggregate principal amount of Securities of this series 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, subject to certain exceptions set forth in the Senior Debt Securities Indenture, the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge payable in connection therewith.

 

Prior to due presentment of this Security for registration of transfer, the Issuer, the Trustee and any agent of the Issuer or the Trustee may treat the Person in whose name this Security is registered as the owner hereof for all purposes, whether or not this Security be overdue, and none of the Issuer, the Trustee or any such agent shall be affected by notice to the contrary.

 

The obligations of the Issuer under the Senior Debt Securities Indenture and this Security and all documents delivered in the name of the Issuer in connection herewith and therewith do not and shall not constitute personal obligations of the directors, officers, employees, agents or shareholders of the Issuer or any of them, and shall not involve any claim against or personal liability on the part of any of them, and all persons including the Trustee shall look solely to the assets of the Issuer for the payment of any claim thereunder or for the performance thereof and shall not seek recourse against such directors, officers, employees, agents or shareholders of the Issuer or any of them or any of their personal assets for such satisfaction.  The performance of the obligations of the Issuer under the Senior Debt Securities Indenture and this Security and all documents delivered in the name of the Issuer in connection therewith shall not be deemed a waiver of any rights or powers of the Issuer or its directors or shareholders under the Issuer’s Memorandum and Articles of Association.

 

Notwithstanding any other term of the Securities or the Senior Debt Securities Indenture or any other agreements, arrangements or understandings between the Issuer and any Holder of the Securities (including for these purposes each holder of a beneficial interest in the Securities), by its acquisition of the Securities, each Holder of the Securities acknowledges, accepts, agrees to be bound by and consents to:

 

(a) the effect of the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority, whether or not imposed with prior notice, that may include and result in:  (i) the reduction of all, or a portion, of the Amounts Due; (ii) the conversion of all, or a portion, of the Amounts Due on the Securities into the Issuer’s or another Person’s shares, other securities or other obligations (and the issue to or conferral on the Holder of the Securities of such shares, other securities or other obligations) including by means of an amendment, modification or variation of the terms of the Securities; (iii) the cancellation of the Securities; and/or (iv) the amendment or alteration of the maturity of the Securities or the amount of interest payable on the Securities, or the date on which the interest becomes payable, including by suspending payment for a temporary period; and

 

(b) the variation, if necessary, of the terms of the Senior Debt Securities Indenture or the Securities to give effect to the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

No Amounts Due on the Securities will become due and payable or be paid after the exercise of any UK Bail-in Power by the Relevant UK Resolution Authority if and to the extent such Amounts Due have been reduced, converted, cancelled, amended or altered as a result of such exercise.

 

B-9

 

Notwithstanding any other provision of the Senior Debt Securities Indenture or the Securities, neither a reduction or cancellation, in part or in full, of the Amounts Due, the conversion thereof into another security or obligation of the Issuer or another Person, as a result of the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Issuer, nor the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities will be an Event of Default.

 

By its acquisition of the Securities, each Holder of the Securities (which for these purposes includes each holder of a beneficial interest in the Securities):(i) to the extent permitted by the Trust Indenture Act, waives any and all claims, in law and/or in equity, against the Trustee for, agrees not to initiate a suit against the Trustee in respect of, and agrees that the Trustee will not be liable for, any action that the Trustee takes, or abstains from taking, in either case in accordance with the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities;

 

(ii) acknowledges and agrees that neither a cancellation or deemed cancellation of the principal or interest (in each case, in whole or in part), nor the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities will give rise to a default for purposes of Section 315(b) (Notice of Default) and Section 315(c) (Duties of the Trustee in Case of Default) of the Trust Indenture Act; and

 

(iii) acknowledges and agrees that, upon the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority:

 

(A) the Trustee shall not be required to take any further directions from the Holders of the Securities with respect to any portion of the Securities that are written-down, converted to equity and/or cancelled under Section 5.12 of the Senior Debt Securities Indenture, and

 

(B) the Senior Debt Securities Indenture shall not impose any duties upon the Trustee whatsoever with respect to the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority.

 

Notwithstanding clauses (i)-(iii), if, following the completion of the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority, the Securities remain Outstanding (for example, if the exercise of the UK Bail-in Power results in only a partial write-down of the principal of the Securities), then the Trustee’s duties under the Senior Debt Securities Indenture shall remain applicable with respect to such Securities following such completion to the extent the Issuer and the Trustee shall agree pursuant to a supplemental indenture or an amendment to the Senior Debt Securities Indenture; provided, however, that, notwithstanding the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority, so long as the Securities remain Outstanding, there will at all times be a Trustee for the Securities in accordance with, Section 6.09 of the Senior Debt Securities Indenture, and the resignation and/or removal of the Trustee and the appointment of a successor Trustee will continue to be governed by Sections 6.10 and 6.11 of the Senior Debt Securities Indenture, respectively, including to the extent no additional supplemental indenture or amendment is agreed upon in the event the Securities remain Outstanding following the completion of the exercise of the Bail-in Power.

 

Upon the exercise of the UK Bail-in Power by the Relevant UK Resolution Authority with respect to the Securities, the Issuer will provide a written notice to DTC as soon as practicable regarding such exercise of the UK Bail-in Power for the purposes of notifying the Holders of such occurrence. The Issuer will also deliver a copy of such notice to the Trustee for information purposes. Each Holder of the Securities (including for these purposes each holder of a beneficial interest in the Securities) shall be deemed to have authorized, directed and requested DTC and any direct participant in DTC or other intermediary through which it holds the Securities to take any and all necessary action, if required, to implement the exercise of the UK Bail-in Power with respect to the Securities as it may be imposed, without any further action or direction on the part of such Holder, the Trustee or the Paying Agent.

 

B-10

 

“UK Bail-in Power” means any write-down, conversion, transfer, modification, or suspension power existing from time to time under, and exercised in compliance with, any laws, regulations, rules or requirements in effect in the United Kingdom, relating to the transposition of Directive 2014/59/EU establishing a framework for the recovery and resolution of credit institutions and investment firms as amended from time to time (“BRRD”), including but not limited to the UK Banking Act 2009, as the same may be amended from time to time including by the Financial Services (Banking Reform) Act 2013and the instruments, rules and standards created thereunder, pursuant to which: (i) any obligation of a Regulated Entity (or other affiliate of such Regulated Entity) can be reduced, cancelled, modified, or converted into shares, other securities, or other obligations of such Regulated Entity or any other Person (or suspended for a temporary period); and (ii) any right in a contract governing an obligation of a Regulated Entity may be deemed to have been exercised.

 

“Regulated Entity” means any BRRD undertaking as such term is defined under the PRA Rulebook promulgated by the United Kingdom Prudential Regulation Authority, as amended from time to time, which includes, certain credit institutions, investment firms, and certain of their parent or holding companies.

 

“Relevant UK Resolution Authority” means the Bank of England or any other authority with the ability to exercise a UK Bail-in Power.

 

“Amounts Due” means the principal amount of, and accrued but unpaid interest, including any Additional Amounts due on, the debt securities. References to principal and interest will include payments of principal and interest that have become due and payable but which have not been paid, prior to the exercise of any UK bail-in power by the Relevant UK Resolution Authority.

 

The Senior Debt Securities Indenture and the Securities, including this Security, shall be governed by and construed in accordance with the law of the State of New York.

 

Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused “CUSIP” numbers to be printed on the Securities as a convenience to the Holders of the Securities.  No representation is made as to the correctness or accuracy of such CUSIP numbers as printed on the Securities, and reliance may be placed only on the other identification numbers printed hereon.

 

B-11

 

ASSIGNMENT FORM

 

FOR VALUE RECEIVED, the undersigned hereby
 sells, assigns and transfers unto

 

PLEASE INSERT SOCIAL

SECURITY OR OTHER IDENTIFYING

NUMBER OF ASSIGNEE

 

	
 
    	
 
    

 

	
 
    
	
(Please Print or Typewrite Name and Address, including Zip Code, of   Assignee)
    

 

	
 
    

the within Security of the company and                          hereby does irrevocably constitute and appoint

 

	
 
    

attorney to transfer said Security on the books of the within-named company with full power of substitution in the premises.

 

	
Dated:
    	
 
    
	
 
    
	
Signature
    	
 
    
			

 

NOTICE: The signature to this assignment must correspond with the name as it appears on the first page of the within Security in every particular, without alteration or enlargement or any change whatever.

 

	
Signature Guaranteed:
    	
 
    

 

NOTICE: Signature(s) must be guaranteed by an “eligible guarantor institution” that is a member or participant in a “signature guarantee program” (e.g., the Securities Transfer Agents Medallion Program, the Stock Exchange Medallion Program and the New York Stock Exchange Medallion Program).

 

B-12

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