Document:

Exhibit 4.10

 

NORTHSTAR REALTY FINANCE CORP.

 

as the Company

 

to

 

WILMINGTON TRUST, NATIONAL ASSOCIATION

 

as the Trustee

 

 

Indenture

 

Dated as of March    , 2014

 

 

$              

 

3.00% Senior Notes due September 30, 2014

 

 

CROSS REFERENCE TABLE(1)

 

	
Trust
   Indenture
   Act Section
    	
 
    	
 
    	
 
    	
Indenture
   Section
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
310(a)(1)
    	
 
    	
 
    	
 
    	
6.09
    
	
310(a)(2)
    	
 
    	
 
    	
 
    	
6.09
    
	
310(a)(3)
    	
 
    	
 
    	
 
    	
N.A.(2)
    
	
310(a)(4)
    	
 
    	
 
    	
 
    	
N.A.
    
	
310(a)(5)
    	
 
    	
 
    	
 
    	
N.A.
    
	
310(b)
    	
 
    	
 
    	
 
    	
6.08;   6.10
    
	
310(c)
    	
 
    	
 
    	
 
    	
N.A.
    
	
311(a)
    	
 
    	
 
    	
 
    	
6.13
    
	
311(b)
    	
 
    	
 
    	
 
    	
6.13
    
	
311(c)
    	
 
    	
 
    	
 
    	
N.A.
    
	
312(a)
    	
 
    	
 
    	
 
    	
7.01;   7.02
    
	
312(b)
    	
 
    	
 
    	
 
    	
7.02
    
	
312(c)
    	
 
    	
 
    	
 
    	
7.02
    
	
313(a)
    	
 
    	
 
    	
 
    	
7.03
    
	
313(b)
    	
 
    	
 
    	
 
    	
7.03
    
	
313(c)
    	
 
    	
 
    	
 
    	
1.06;   7.03
    
	
313(d)
    	
 
    	
 
    	
 
    	
7.03
    
	
314(a)
    	
 
    	
 
    	
 
    	
10.05
    
	
314(a)(4)
    	
 
    	
 
    	
 
    	
1.03;   10.04
    
	
314(b)
    	
 
    	
 
    	
 
    	
N.A.
    
	
314(c)(1)
    	
 
    	
 
    	
 
    	
1.03
    
	
314(c)(2)
    	
 
    	
 
    	
 
    	
1.03
    
	
314(c)(3)
    	
 
    	
 
    	
 
    	
N.A.
    
	
314(d)
    	
 
    	
 
    	
 
    	
N.A.
    
	
314(e)
    	
 
    	
 
    	
 
    	
1.03
    
	
314(f)
    	
 
    	
 
    	
 
    	
N.A.
    
	
315(a)
    	
 
    	
 
    	
 
    	
6.01
    
	
315(b)
    	
 
    	
 
    	
 
    	
6.02
    
	
315(c)
    	
 
    	
 
    	
 
    	
6.01
    
	
315(d)
    	
 
    	
 
    	
 
    	
6.01
    
	
315(e)
    	
 
    	
 
    	
 
    	
5.14
    
	
316(a)(1)(A)
    	
 
    	
 
    	
 
    	
5.12
    
	
316(a)(1)(B)
    	
 
    	
 
    	
 
    	
5.13
    
	
316(a)(2)
    	
 
    	
 
    	
 
    	
N.A.
    
	
316(a)(last   sentence)
    	
 
    	
 
    	
 
    	
1.01(3)
    
	
316(b)
    	
 
    	
 
    	
 
    	
5.07;   5.08
    
	
316(c)
    	
 
    	
 
    	
 
    	
1.04
    
	
317(a)(1)
    	
 
    	
 
    	
 
    	
5.03
    
	
317(a)(2)
    	
 
    	
 
    	
 
    	
5.03;   5.04
    
	
317(b)
    	
 
    	
 
    	
 
    	
10.03
    
	
318(a)
    	
 
    	
 
    	
 
    	
1.07
    

 

(1)   Note: This Cross Reference Table shall not, for any purpose, be deemed part of this Indenture.

(2)   Not Applicable.

(3)   Definition of “Outstanding.”

 

i

 

TABLE OF CONTENTS

 

	
 
    	
Page
    
	
 
    	
 
    
	
ARTICLE I
    
	
 
    
	
DEFINITIONS   AND OTHER PROVISIONS OF GENERAL APPLICATION
    
	
 
    	
 
    
	
Section 1.01 Definitions
    	
1
    
	
Section 1.02 Compliance Certificates and Opinions
    	
9
    
	
Section 1.03 Form of Documents Delivered to   Trustee
    	
10
    
	
Section 1.04 Acts of Holders; Record Dates
    	
10
    
	
Section 1.05 Notices to Trustee or the Company
    	
12
    
	
Section 1.06 Notice to Holders; Waiver
    	
12
    
	
Section 1.07 Conflict with Trust Indenture Act
    	
13
    
	
Section 1.08 Effect of Headings and Table of Contents
    	
13
    
	
Section 1.09 Successors and Assigns
    	
13
    
	
Section 1.10 Separability Clause
    	
13
    
	
Section 1.11 Benefits of Indenture
    	
13
    
	
Section 1.12 Governing Law
    	
13
    
	
Section 1.13 Legal Holidays
    	
13
    
	
Section 1.14 Waiver of Jury Trial
    	
13
    
	
Section 1.15 Force Majeure
    	
14
    
	
Section 1.16 Counterparts
    	
14
    
	
Section 1.17 U.S.A. Patriot Act
    	
14
    
	
 
    	
 
    
	
ARTICLE II
    
	
 
    
	
SECURITY   FORMS
    
	
 
    	
 
    
	
Section 2.01 Form and Dating
    	
14
    
	
Section 2.02 Authentication
    	
15
    
	
Section 2.03 Transfer and Exchange
    	
15
    
	
Section 2.04 Definitive Securities
    	
18
    
	
 
    	
 
    
	
ARTICLE III
    
	
 
    
	
THE   SECURITIES
    
	
 
    	
 
    
	
Section 3.01 Title and Terms
    	
19
    
	
Section 3.02 Denominations
    	
19
    
	
Section 3.03 Execution and Authentication
    	
19
    
	
Section 3.04 Temporary Securities
    	
20
    
	
Section 3.05 Registration, Registration of Transfer   and Exchange
    	
21
    
	
Section 3.06 Mutilated, Destroyed, Lost and Stolen   Securities
    	
21
    
	
Section 3.07 Payment of Interest; Rights Preserved
    	
22
    
	
Section 3.08 Persons Deemed Owners
    	
23
    
	
Section 3.09 Cancellation
    	
23
    

 

ii

 

	
Section 3.10 Computation of Interest
    	
23
    
	
Section 3.11 CUSIP Numbers
    	
24
    
	
Section 3.12 Deposits of Monies
    	
24
    
	
Section 3.13 Issuance of Additional Securities
    	
24
    
	
 
    	
 
    
	
ARTICLE IV
    
	
 
    
	
SATISFACTION   AND DISCHARGE
    
	
 
    	
 
    
	
Section 4.01 Satisfaction and Discharge of Indenture
    	
25
    
	
Section 4.02 Application of Trust Money
    	
25
    
	
Section 4.03 Paying Agent to Repay Monies Held
    	
26
    
	
Section 4.04 Reinstatement
    	
26
    
	
 
    	
 
    
	
ARTICLE V
    
	
 
    
	
REMEDIES
    
	
 
    	
 
    
	
Section 5.01 Events of Default
    	
26
    
	
Section 5.02 Acceleration of Maturity; Rescission and   Annulment
    	
28
    
	
Section 5.03 Collection of Indebtedness and Suits for   Enforcement by Trustee
    	
29
    
	
Section 5.04 Trustee May File Proofs of Claim
    	
29
    
	
Section 5.05 Trustee May Enforce Claims Without   Possession of Securities
    	
30
    
	
Section 5.06 Application of Money Collected
    	
30
    
	
Section 5.07 Limitation on Suits
    	
30
    
	
Section 5.08 Unconditional Right of Holders to Receive   Principal and Interest
    	
31
    
	
Section 5.09 Restoration of Rights and Remedies
    	
31
    
	
Section 5.10 Rights and Remedies Cumulative
    	
31
    
	
Section 5.11 Delay or Omission Not Waiver
    	
32
    
	
Section 5.12 Control by Holders
    	
32
    
	
Section 5.13 Waiver of Past Defaults
    	
32
    
	
Section 5.14 Undertaking for Costs
    	
32
    
	
Section 5.15 Waiver of Stay or Extension Laws
    	
33
    
	
 
    	
 
    
	
ARTICLE VI
    
	
 
    
	
THE   TRUSTEE
    
	
 
    	
 
    
	
Section 6.01 Certain Duties and Responsibilities
    	
33
    
	
Section 6.02 Notice of Defaults
    	
33
    
	
Section 6.03 Certain Rights of Trustee
    	
34
    
	
Section 6.04 Not Responsible for Recitals or Issuance   of Securities
    	
35
    
	
Section 6.05 May Hold Securities
    	
35
    
	
Section 6.06 Money Held in Trust
    	
36
    
	
Section 6.07 Compensation and Reimbursement
    	
36
    
	
Section 6.08 Conflicting Interests
    	
36
    
	
Section 6.09 Corporate Trustee Required; Eligibility
    	
36
    

 

iii

 

	
Section 6.10 Resignation and Removal; Appointment of   Successor
    	
37
    
	
Section 6.11 Acceptance of Appointment by Successor
    	
38
    
	
Section 6.12 Merger, Conversion, Consolidation or   Succession to Business
    	
38
    
	
Section 6.13 Preferential Collection of Claims Against   the Company
    	
39
    
	
Section 6.14 Appointment of Authenticating Agent
    	
39
    
	
 
    	
 
    
	
ARTICLE VII
    
	
 
    
	
HOLDERS’   LISTS AND REPORTS BY TRUSTEE
    
	
 
    	
 
    
	
Section 7.01 Company to Furnish Trustee Names and   Addresses of Holders
    	
40
    
	
Section 7.02 Preservation of Information;   Communications to Holders
    	
40
    
	
Section 7.03 Reports by Trustee
    	
41
    
	
 
    	
 
    
	
ARTICLE VIII
    
	
 
    
	
CONSOLIDATION,   MERGER, CONVEYANCE, TRANSFER OR LEASE
    
	
 
    	
 
    
	
Section 8.01 Company May Consolidate, Etc.,   Only on Certain Terms
    	
41
    
	
Section 8.02 Successor Substituted
    	
41
    
	
 
    	
 
    
	
ARTICLE IX
    
	
 
    
	
MODIFICATIONS;   AMENDMENTS; WAIVERS; SUPPLEMENTAL INDENTURES
    
	
 
    	
 
    
	
Section 9.01 Modifications and Amendments Without   Consent of Holders
    	
42
    
	
Section 9.02 Modifications and Amendments With Consent   of Holders
    	
43
    
	
Section 9.03 Execution of Supplemental Indentures
    	
44
    
	
Section 9.04 Effect of Supplemental Indentures
    	
44
    
	
Section 9.05 Conformity with Trust Indenture Act
    	
44
    
	
Section 9.06 Reference in Securities to Supplemental   Indentures
    	
44
    
	
Section 9.07 Waiver of Certain Covenants
    	
44
    
	
Section 9.08 No Liability for Certain Persons
    	
44
    
	
 
    	
 
    
	
ARTICLE X
    
	
 
    
	
COVENANTS
    
	
 
    	
 
    
	
Section 10.01 Payment of Principal and Interest
    	
45
    
	
Section 10.02 Maintenance of Office or Agency
    	
45
    
	
Section 10.03 Money for Security Payments to be Held   in Trust
    	
45
    
	
Section 10.04 Statement by Officers as to Default;   Compliance Certificates
    	
46
    
	
Section 10.05 Provision of Financial Information
    	
47
    

 

iv

 

	
ARTICLE XI
    
	
 
    
	
REDEMPTION   OF SECURITIES AND PURCHASES THEREUPON
    
	
 
    	
 
    
	
Section 11.01 Right of Redemption
    	
47
    
	
Section 11.02 Securities Purchased in Whole or in Part
    	
48
    
	
Section 11.03 Covenant to Comply With Applicable Laws   Upon Purchase of Securities
    	
49
    
	
Section 11.04 Sinking Fund
    	
49
    
	
 
    	
 
    
	
ARTICLE XII
    
	
 
    
	
SHARE   SETTLEMENT
    
	
 
    	
 
    
	
Section 12.01 Right to Settle in Shares
    	
49
    
	
Section 12.02 Share Settlement Procedures
    	
49
    
	
Section 12.03 Determination of Share Settlement Amount
    	
50
    
	
Section 12.04 Adjustment of Share Settlement Rate
    	
51
    
	
Section 12.05 Certain Other Adjustments
    	
57
    
	
Section 12.06 Taxes on Shares Issued
    	
57
    
	
Section 12.07 Responsibility of Trustee
    	
58
    
	
Section 12.08 Ownership Limit
    	
58
    
	
 
    	
 
    
	
ARTICLE XIII
    
	
 
    
	
REPURCHASE
    
	
 
    	
 
    
	
Section 13.01 Repurchase at Option of Holders upon a   Change in Control
    	
58
    
	
Section 13.02 Securities Purchased in Part
    	
61
    
	
Section 13.03 Purchase of Securities in Open Market
    	
61
    

 

Note: This table of contents shall not, for any purpose, be deemed to be a part of the Indenture.

 

v

 

INDENTURE, dated as of March     , 2014, between NORTHSTAR REALTY FINANCE CORP., a corporation duly organized and existing under the laws of the State of Maryland (herein called the “Company”), having its principal office at 399 Park Avenue, 18th Floor, New York, New York 10022, and Wilmington Trust, National Association, a national banking association having its principal corporate trust office at 50 South Sixth Street, Suite 1290, Minneapolis, Minnesota 55402, as trustee (herein called the “Trustee”).

 

RECITALS OF THE COMPANY

 

The Company has duly authorized the creation of an issue of 3.00% Senior Notes due September 30, 2014 of substantially the tenor and amount hereinafter set forth, and to provide therefor, the Company has duly authorized the execution and delivery of this Indenture.

 

All things necessary to make the Securities, when executed by the Company, authenticated and delivered hereunder and duly issued by the Company, the valid and legally binding obligations of the Company, and to make this Indenture a valid and legally binding agreement of the Company, in accordance with its terms, have been done.

 

NOW, THEREFORE, THIS INDENTURE WITNESSETH:

 

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

 

ARTICLE I

 

Definitions and Other Provisions of General Application

 

SECTION 1.01 Definitions.  For all purposes of this Indenture, except as otherwise expressly provided or unless the context otherwise requires:

 

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

 

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

 

(c)                                  all accounting terms not otherwise defined herein have the meanings assigned to them in accordance with U.S. generally accepted accounting principles as in effect on the Issue Date (whether or not such is indicated herein);

 

(d)                                 unless the context otherwise requires, any reference to an “Article” or a “Section” refers to an Article or Section, as the case may be, of this Indenture;

 

(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;

 

 

(f)                                   each reference herein to a rule or form of the Commission shall mean such rule or form and any rule or form successor thereto, in each case as amended from time to time;

 

(g)                                  “or” is not exclusive;

 

(h)                                 “including” means including without limitation; and

 

(i)                                     all references to the date the Securities were originally issued shall refer to the Issue Date, except as otherwise specified.

 

Except as may be otherwise specified herein, the Company will be responsible for making all calculations called for under this Indenture and the Securities.  These calculations include, but are not limited to, determinations of the market prices of the Securities and of the Company Common Shares, any accrued interest payable on the Securities, redemption prices and the Share Settlement Rate of the Securities.  The Company will make all these calculations in good faith and, absent manifest error, its calculations will be final and binding on holders of the Securities.  The Company will provide a schedule of its calculations to the Trustee and the Trustee is entitled to rely upon the accuracy of its calculations without independent verification.

 

“Act” when used with respect to any Holder, has the meaning specified in Section 1.04.

 

“Additional Securities” means 3.00% Senior Notes due 2014 issued from time to time after the Issue Date under the terms of this Indenture (other than pursuant to Section 3.04, 3.05 and 3.06)

 

“Affiliate” means, with respect to any specified Person, (i) any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person, (ii) any other Person that owns, directly or indirectly, 10% or more of such specified Person’s Capital Stock or (iii) any officer or director of (A) any such specified Person, (B) any Subsidiary of such specified Person or (C) any Person described in clauses (i) or (ii) above.

 

“Agent Member” has the meaning specified in Section 2.01(c).

 

“Applicable Procedures” has the meaning specified in Section 11.01(e).

 

“Applicable Share Settlement Rate” has the meaning specified in Section 12.03(a).

 

“Authenticating Agent” means any Person authorized by the Trustee pursuant to Section 6.14 hereof to act on behalf of the Trustee to authenticate Securities.

 

“Board of Directors” or “Board” means the board of directors of a company or its equivalent, including managers of a limited liability company, general partners of a partnership or trustees of a business trust, or any duly authorized committee thereof.

 

“Board Resolution” means a copy of a resolution certified by the Secretary or an Assistant Secretary of a company to have been duly adopted by the Board of Directors of such company and to be in full force and effect on the date of such certification, and delivered to the Trustee.

 

2

 

“Business Day” means any day other than a Saturday, a Sunday or a day on the Federal Reserve Bank of New York or the place of payment is authorized or required by law or executive order to close or be closed.

 

“Capital Stock” means, with respect to any Person, any and all shares, interests, participations, rights in or other equivalents (however designated) of such Person’s capital stock or equity participations, and any rights (other than debt securities convertible into capital stock), warrants or options exchangeable for or convertible into such capital stock and, including, without limitation, with respect to partnerships, limited liability companies or business trusts, ownership interests (whether general or limited) and any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, such partnerships, limited liability companies or business trusts.

 

“Change in Control” will be deemed to have occurred if any of the following occurs after the Issue Date:

 

(i)                                     consummation of any transaction or event (whether by means of a liquidation, share exchange, tender offer, consolidation, recapitalization, reclassification, combination, merger of us or any sale, lease or other transfer of all or substantially all of the consolidated assets of the Company and its consolidated subsidiaries) or a series of related transactions or events pursuant to which all of the Company Common Shares are exchanged for, converted into or constitute solely the right to receive cash, securities or other property more than 10% of which consists of cash, securities or other property that are not, or upon issuance will not be, traded on a national securities exchange;

 

(ii)                                  any “person” or “group” (as such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange Act, whether or not applicable), other than the Company, the Operating Partnership, Sub-REIT or any majority-owned subsidiary of the Company, the Operating Partnership or Sub-REIT, is or becomes the “beneficial owner” (as such term is defined for purposes of Section 13(d)(3) under the Exchange Act), directly or indirectly, of more than 50% of the total voting power in the aggregate of all classes of the Capital Stock of the Company then outstanding entitled to vote generally in elections of directors;

 

(iii)                               the Company Common Shares (or other Capital Stock or securities into which the Securities are then exchangeable) cease to be listed on a U.S. national securities exchange for 30 consecutive days;

 

(iv)                              the Company (or any successor thereto permitted pursuant to the terms of the indenture) ceases to directly or indirectly control the Operating Partnership; or

 

(v)                                 the stockholders of the Company approve any plan or proposal for the liquidation of the Company, the Operating Partnership or Sub-REIT.

 

However, a Change in Control will not be deemed to have occurred and the Company will not be required to deliver a Change in Control Notice incidental thereto if at least 90% of the consideration (excluding cash payments for fractional shares and cash payments made pursuant to dissenters’ appraisal rights) in a merger, consolidation or other transaction otherwise

 

3

 

constituting a Change in Control consists of Company Common Shares, depositary receipts or other certificates representing common equity interests traded on a national securities exchange in the United States (or will be so traded or quoted immediately following the merger, consolidation, or other transaction) and as a result of the merger, consolidation or other transaction the Securities can be settled for such Company Common Shares, depositary receipts or other certificates representing common equity interests.

 

For the avoidance of doubt, neither the spin-off of the Company’s asset management business that is proposed on the Issue Date or the consolidation or merger of the Company, the Operating Partnership and Sub-REIT into a single entity, regardless of which entity is the survivor thereof, shall constitute a Change in Control for purposes hereof.

 

For purposes of these provisions “person” includes any syndicate or group that would be deemed to be a “person” under Section 13(d)(3) of the Exchange Act.

 

“Change in Control Offer” has the meaning specified in Section 13.01(a).

 

“Change in Control Notice” has the meaning specified in Section 13.01(b).

 

“Change in Control Purchase Date” has the meaning specified in Section 13.01(b).

 

“Change in Control Purchase Notice” has the meaning specified in Section 13.01(c).

 

“Change in Control Purchase Price” means a purchase price equal to 100% of the principal amount of the Securities a Holder requires the Company to repurchase, plus accrued and unpaid interest on Securities to, but excluding, the Change in Control Purchase Date.

 

“Close of Business” means 5:00 p.m. (New York City time).

 

“Closing Sale Price” has the meaning specified in Section 12.03(f).

 

“Commission” means the Securities and Exchange Commission, as from time to time constituted, created under the Exchange Act, or, if at any time after the execution of this instrument such Commission is not existing and performing the duties now assigned to it under the Trust Indenture Act, then the body performing such duties at such time.

 

“Company Common Shares” means the shares of common stock, par value $0.01 per share, of the Company authorized at the date of this instrument as originally executed or as such stock may be constituted from time to time.  Company Common Shares issuable upon the Company’s election to provide Company Common Shares in lieu of cash at the Stated Maturity Date of the Securities shall include only Company Common Shares or shares of any class or classes of common stock resulting from any reclassification or reclassifications thereof; provided, however, that if at any time there shall be more than one such resulting class, the shares so issuable shall include shares of all such classes, and the shares of each such class then so issuable shall be substantially in the proportion which the total number of shares of such class resulting from all such reclassifications bears to the total number of shares of all such classes

 

4

 

resulting from all such reclassifications.  For the avoidance of doubt, the term Company Common Shares does not include any securities issued in connection with the proposed spin-off of the Company’s asset management business insofar as that spin-off takes place prior to the Share Settlement Measurement Period.

 

“Company” means the Person named as the “Company” in the first paragraph of this Indenture until a successor Person shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Company” shall mean such successor Person.

 

“Company Order” or “Company Request” means a written order or request signed in the name of the Company by its Chairman of the Board of Directors, its Chief Executive Officer, its Chief Financial Officer, its President or a Vice President, and by its Treasurer, an Assistant Treasurer, its Secretary or an Assistant Secretary, and delivered to the Trustee or Paying Agent, as applicable.

 

“control” when used with respect to any specified Person means the power to direct the management and policies of such Person, directly or indirectly, whether through ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

 

“Corporate Trust Office” means the office of the Trustee at which at any particular time its corporate trust business shall be administered, which address as of the date of this Indenture is located at 50 South Sixth Street, Suite 1290, Minneapolis, MN 55402, Attention: Northstar Realty Finance Corp. Administrator or such other address as the Trustee may designate from time to time by notice to the Holders and the Company, or the principal corporate trust office of any successor Trustee (or such other address as a successor Trustee may designate from time to time by notice to the Holders and the Company).

 

“corporation” means (except in the definition of “Subsidiary”) a corporation, association, company, joint stock company or business trust.

 

“Daily VWAP” has the meaning specified in Section 12.03(d).

 

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

 

“Defaulted Interest” has the meaning specified in Section 3.07

 

“Definitive Security” means a certificated Security that does not include the Global Securities Legend.

 

“Depositary” means The Depository Trust Company, a New York corporation, or its successor.

 

“Event of Default” has the meaning specified in Section 5.01.

 

“Exchange Act” means the Securities Exchange Act of 1934 and any successor statute thereto, in each case as amended.

 

5

 

“Ex-Dividend Date” means, in respect of any dividend or distribution, the first date upon which the Company Common Shares trade on the applicable exchange or in the applicable market (used to determine the Closing Sale Price), regular way, without the right to receive such dividend or distribution.

 

“Expiration Time” has the meaning in Section 12.04(e).

 

“Federal Bankruptcy Code” means Title 11, U.S. Code.

 

“Global Security” has the meaning specified in Section 2.01(b).

 

“Global Securities Legend” means the legend set forth under that caption in Exhibit A to this Indenture.

 

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

 

“Indenture” means this instrument as originally executed or as it may from time to time be supplemented or amended by one or more indentures supplemental hereto entered into pursuant to the applicable provisions hereof, including, for all purposes of this instrument and any such supplemental indenture, the provisions of the Trust Indenture Act that are deemed to be a part of and govern this instrument and any such supplemental indenture, respectively.

 

“Issue Date” means March    , 2014.

 

“legal holiday” means, with respect to the Securities, a Saturday, Sunday, or a day on which federally chartered banking institutions in The City of New York or the place of payment are authorized or obligated to close.

 

“Market Disruption Event” means the occurrence or existence for more than a one-half hour period in the aggregate on any scheduled trading day for the Company Common Shares of any suspension or limitation imposed on trading (by reason of movements in price exceeding limits permitted by the securities exchange or otherwise) in the Company Common Shares or in any options, contracts or futures contracts relating to the Company Common Shares, and such suspension or limitation occurs or exists at any time before 1:00 p.m. (New York City time) on such day.

 

“Notice of Default” means a written notice of the kind specified in Section 5.02.

 

“Officers’ Certificate” means a certificate signed by the Chairman of the Board of Directors, the Chief Executive Officer, the President or a Vice President, the Chief Financial Officer, the Treasurer, an Assistant Treasurer, the Secretary or an Assistant Secretary, of the Company, and delivered to the Trustee.  One of the officers signing an Officers’ Certificate given pursuant to Section 10.04 shall be the principal executive, financial or accounting officer of the Company.

 

“open of business” means 9:00 a.m. (New York City time).

 

“Operating Partnership” means NorthStar Realty Finance Limited Partnership, a Delaware limited partnership.

 

6

 

“Opinion of Counsel” means a written opinion of counsel reasonably acceptable to the Trustee, who may be counsel for the Company.

 

“Outstanding” when used with respect to Securities, means, as of the date of determination, all Securities theretofore authenticated and delivered under this Indenture, except:

 

(i)                                     Securities theretofore cancelled by the Trustee or delivered to the Trustee for cancellation;

 

(ii)                                  Securities for whose payment or purchase money or securities in the necessary amount has been theretofore deposited with the Trustee or any Paying Agent (other than the Company) in trust or set aside and segregated in trust by the Company (if the Company shall act as its own Paying Agent) for the Holders of such Securities; and

 

(iii)                               Securities which have been paid pursuant to Section 3.06 or in exchange for or in lieu of which other Securities have been authenticated and delivered pursuant to this Indenture, other than any such Securities in respect of which there shall have been presented to the Trustee proof satisfactory to it that such Securities are held by a bona fide purchaser in whose hands such Securities are valid obligations of the Company;

 

provided, however, that in determining whether the Holders of the requisite principal amount of the Outstanding Securities have given, made or taken any request, demand, authorization, direction, notice, consent, waiver or other action hereunder as of any date, Securities owned by the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor shall be disregarded and deemed not to be Outstanding (it being understood that Securities to be acquired by the Company pursuant to an offer to purchase shall not be deemed to be owned by the Company until legal title to such Securities passes to the Company), except that, in determining whether the Trustee shall be protected in relying upon any such request, demand, authorization, direction, notice, consent, waiver or other action, only Securities which a Responsible Officer of the Trustee actually knows to be so owned shall be so disregarded.  Securities so owned which have been pledged in good faith may be regarded as Outstanding if the pledgee establishes to the satisfaction of the Trustee the pledgee’s right so to act with respect to such Securities and that the pledgee is not the Company or any other obligor upon the Securities or any Affiliate of the Company or of such other obligor.

 

“Paying Agent” means any Person authorized by the Company to pay the principal of or interest on any Securities on behalf of the Company.  The Company has initially appointed the Trustee as its Paying Agent pursuant to Section 10.02 hereof.

 

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

 

“principal” of a Security means the principal of the Security plus the premium, if any, payable on that Security which is due or overdue or is to become due at the relevant time.

 

“Record Expiration Date” has the meaning specified in Section 1.04.

 

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“Responsible Officer” when used with respect to the Trustee, means any officer within the Corporate Trust Office, including, any vice president, any assistant vice president, any assistant secretary, any assistant treasurer, or any other officer of the Trustee customarily performing functions similar to those performed by any of the above designated officers and also means, with respect to a particular corporate trust matter, any other officer to whom such matter is referred because of his knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

 

“scheduled trading day” means a day that is scheduled to be a trading day on the principal U.S. securities exchange on which the Company Common Shares are listed or admitted for trading.

 

“Securities” means the 3.00% Senior Notes due September 30, 2014 issued on the Issue Date and any Additional Securities.

 

“Securities Act” means the Securities Act of 1933 and any statute successor thereto, in each case, as amended from time to time.

 

“Securities Custodian” means the custodian with respect to a Global Security (as appointed by the Depositary) or any successor person thereto, who shall initially be the Trustee.

 

“Security Register” or “Registrar” has the meaning specified in Section 3.05.

 

“Share Settlement” has the meaning specified in Section 12.01.

 

“Share Settlement Election Date” has the meaning specified in Section 12.02(a)

 

“Share Settlement Election Notice” has the meaning specified in Section 12.02(a).

 

“Share Settlement Measurement Period” has the meaning specified in Section 12.03(b).

 

“Share Settlement Rate” has the meaning specified in Section 12.03(a).

 

“Special Record Date” for the payment of any Defaulted Interest means a date fixed by the Company pursuant to Section 3.07.

 

“Spin-Off” has the meaning specified in Section 12.04(c).

 

“Stated Maturity Date” means, when used with respect to any Security and the payment of principal and interest thereon, September 30, 2014.

 

“Subsidiary” means, with respect to any Person, (i) a corporation a majority of whose Voting Stock is at the time, directly or indirectly, owned by such Person, by one or more Subsidiaries of such Person or by such Person and one or more Subsidiaries thereof and (ii) any other Person (other than a corporation), including, without limitation, a partnership, limited liability company, business trust or joint venture, in which such Person, one or more Subsidiaries thereof or such Person and one or more Subsidiaries thereof, directly or indirectly, at the date of determination thereof, has at least majority ownership interest entitled to vote in the election of

 

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directors, managers or trustees thereof (or other Person performing similar functions).  For purposes of this definition, any directors’ qualifying shares or investments by foreign nationals mandated by applicable law shall be disregarded in determining the ownership of a Subsidiary.

 

“Sub-REIT” means NRFC Sub-REIT, a Maryland corporation.

 

“trading day” has the meaning specified in Section 12.03(c).

 

“Trust Indenture Act” means the Trust Indenture Act of 1939 as in force at the date as of which this Indenture was executed; provided, however, that in the event the Trust Indenture Act of 1939 is amended after such date, “Trust Indenture Act” means, to the extent required by any such amendment, the Trust Indenture Act of 1939 as so amended.

 

“Trustee” means the Person named as the “Trustee” in the first paragraph of this instrument until a successor Trustee shall have become such pursuant to the applicable provisions of this Indenture, and thereafter “Trustee” shall mean such successor Trustee.

 

“Vice President” when used with respect to the Company or the Trustee, means any vice president, whether or not designated by a number or a word or words added before or after the title “vice president.”

 

“Voting Stock” means any class or classes of Capital Stock pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of any Person (irrespective of whether or not, at the time, stock of any other class or classes shall have, or might have, voting power by reason of the happening of any contingency).

 

SECTION 1.02 Compliance Certificates and Opinions.  Upon any application or request by the Company to the Trustee to take any action under any provision of this Indenture, the Company shall furnish to the Trustee such certificates and opinions as may be required under the Trust Indenture Act.  Each such certificate or opinion shall be given in the form of an Officers’ Certificate, if to be given by an officer of the Company, or an Opinion of Counsel, if to be given by counsel, and shall comply with the requirements of the Trust Indenture Act and any other requirement set forth in this Indenture.

 

Every certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture shall include:

 

(a)                                 a statement that each individual signing such certificate or opinion has read such covenant or condition and the definitions herein relating thereto;

 

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

 

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

 

(d)                                 a statement as to whether, in the opinion of each such individual, such condition or covenant has been complied with.

 

SECTION 1.03 Form of Documents Delivered to Trustee.  In any case where several matters are required to be certified by, or covered by an opinion of, any specified Person, it is not necessary that all such matters be certified by, or covered by the opinion of, only one such Person, or that they be so certified or covered by only one document, but one such Person may certify or give an opinion with respect to some matters and one or more other such Persons as to other matters, and any such Person may certify or give an opinion as to such matters in one or several documents.

 

Any certificate or opinion of an officer of the Company may be based, insofar as it relates to legal matters, upon a certificate or opinion of, or representations by, counsel, unless such officer knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to the matters upon which his certificate or opinion is based are erroneous.  Any such certificate or opinion of counsel may be based, insofar as it relates to factual matters, upon a certificate or opinion of, or representations by, an officer or officers of the Company stating that the information with respect to such factual matters is in the possession of the Company, unless such counsel knows, or in the exercise of reasonable care should know, that the certificate or opinion or representations with respect to such matters are erroneous.

 

Where any Person is required to make, give or execute two or more applications, requests, consents, certificates, statements, opinions or other instruments under this Indenture, they may, but need not, be consolidated and form one instrument.

 

SECTION 1.04 Acts of Holders; Record Dates.  Any request, demand, authorization, direction, notice, consent, waiver or other action provided or permitted by this Indenture to be given or taken by Holders may be embodied in and evidenced by one or more instruments of substantially similar tenor signed by such Holders in person or by an agent duly appointed in writing; and, except as herein otherwise expressly provided, such action shall become effective when such instrument or instruments are delivered to the Trustee and, where it is hereby expressly required, to the Company.  Such instrument or instruments (and the action embodied therein and evidenced thereby) are herein sometimes referred to as the “Act” of the Holders signing such instrument or instruments.  Proof of execution of any such instrument or of a writing appointing any such agent shall be sufficient for any purpose of this Indenture and (subject to Section 6.01) conclusive in favor of the Trustee and the Company, if made in the manner provided in this Section.

 

The fact and date of the execution by any Person of any such instrument or writing may be proved by the affidavit of a witness of such execution or by a certificate of a notary public or other officer authorized by law to take acknowledgments of deeds, certifying that the individual signing such instrument or writing acknowledged to him the execution thereof.  Where such execution is by a signer acting in a capacity other than his individual

 

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capacity, such certificate or affidavit shall also constitute sufficient proof of his authority.  The fact and date of the execution of any such instrument or writing, or the authority of the Person executing the same, may also be proved in any other manner which the Trustee deems sufficient.

 

The ownership of Securities shall be proved exclusively by the Security Register for all purposes.

 

Any request, demand, authorization, direction, notice, consent, waiver or other Act of the Holder of any Security shall bind every future Holder of the same Security and the Holder of every Security issued upon the registration of transfer thereof or in exchange therefor or in lieu thereof in respect of anything done, omitted or suffered to be done by the Trustee, the Company in reliance thereon, whether or not notation of such action is made upon such Security.

 

The Company may set any day as a record date for the purpose of determining the Holders of Outstanding Securities entitled to give or take any request, demand, authorization, direction, notice, consent, waiver or other action provided or permitted by this Indenture to be given or taken by Holders of Securities, provided, however, that the Company may not set a record date for, and the provisions of this paragraph shall not apply with respect to, the giving or making of any notice, declaration, request or direction referred to in the next paragraph.  If any record date is set pursuant to this paragraph, the Holders of Outstanding Securities on such record date, and no other Holders, shall be entitled to take the relevant action, whether or not such Holders remain Holders after such record date; provided, however, that no such action shall be effective hereunder unless taken on or prior to the applicable Record Expiration Date by Holders of the requisite principal amount of Outstanding Securities on such record date.  Nothing in this paragraph shall prevent the Company from setting a new record date for any action for which a record date has previously been set pursuant to this paragraph (whereupon the record date previously set shall automatically and with no action by any Person be cancelled and of no effect), nor shall anything in this paragraph be construed to render ineffective any action taken pursuant to or in accordance with any other provision of this Indenture by Holders of the requisite principal amount of Outstanding Securities on the date such action is taken.  Promptly after any record date is set pursuant to this paragraph, the Company, at its own expense, shall cause notice of such record date, the proposed action by Holders and the applicable Record Expiration Date to be given to the Trustee in writing and to each Holder of Securities in the manner set forth in Section 1.06.

 

The Trustee may but need not set any day as a record date for the purpose of determining the Holders of Outstanding Securities entitled to join in the giving or making of (i) any Notice of Default, (ii) any declaration of acceleration referred to in Section 5.02, (iii) any request to institute proceedings referred to in Section 5.07(ii) or (iv) any direction referred to in Section 5.12.  If any record date is set pursuant to this paragraph, the Holders of Outstanding Securities on such record date, and no other Holders, shall be entitled to join in such notice, declaration, request or direction, whether or not such Holders remain Holders after such record date; provided, however, that no such action shall be effective hereunder unless taken on or prior to the applicable Record Expiration Date by Holders of the requisite principal amount of Outstanding Securities on such record date.  Nothing in this paragraph shall be construed to prevent the Trustee from setting a new record date for any action (whereupon the record date previously set shall automatically and without any action by any Person be cancelled and of no

 

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effect), nor shall anything in this paragraph be construed to render ineffective any action taken pursuant to or in accordance with any other provision of this Indenture by Holders of the requisite principal amount of Outstanding Securities on the date such action is taken.  Promptly after any record date is set pursuant to this paragraph, the Trustee, at the Company’s expense, shall cause notice of such record date, the matter(s) to be submitted for potential action by Holders and the applicable Record Expiration Date to be given to the Company in writing and to each Holder of Securities in the manner set forth in Section 1.06.

 

With respect to any record date set pursuant to this Section, the party hereto that sets such record date may designate any day as the “Record Expiration Date” and from time to time may change the Record Expiration Date to any earlier or later day, provided, however, that no such change shall be effective unless notice of the proposed new Record Expiration Date is given to the other party hereto in writing, and to each Holder of Securities in the manner set forth in Section 1.06, on or before the existing Record Expiration Date.  If a Record Expiration Date is not designated with respect to any record date set pursuant to this Section, the party hereto that set such record date shall be deemed to have initially designated the 180th day after such record date as the Record Expiration Date with respect thereto, subject to its right to change the Record Expiration Date as provided in this paragraph.  Notwithstanding the foregoing, no Record Expiration Date shall be later than the 180th day after the applicable record date.

 

Without limiting the foregoing, a Holder entitled hereunder to take any action hereunder with regard to any particular Security may do so with regard to all or any part of the principal amount of such Security or by one or more duly appointed agents each of which may do so pursuant to such appointment with regard to all or any part of such principal amount.

 

SECTION 1.05 Notices to Trustee or the Company.  Any request, demand, authorization, direction, notice, consent, waiver or Act of Holders or other document provided or permitted by this Indenture to be made upon, given or furnished to, or filed with,

 

(a)                                 the Trustee by any Holder or by the Company shall be sufficient for every purpose hereunder if made, given, furnished or filed in writing and mailed, first-class postage prepaid, to or with the Trustee at its Corporate Trust Office, 

 

(b)                                 the Company by the Trustee or by any Holder shall be sufficient for every purpose hereunder (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to the Company addressed to it at the address of the Company’s principal office specified in the first paragraph of this instrument, or at any other address previously furnished in writing to the Trustee by the Company.

 

SECTION 1.06 Notice to Holders; Waiver.  Where this Indenture provides for notice to Holders of any event, such notice shall be sufficiently given (unless otherwise herein expressly provided) if in writing and mailed, first-class postage prepaid, to each Holder affected by such event, at his address as it appears in the Security Register, not later than the latest date (if any), and not earlier than the earliest date (if any), prescribed for the giving of such notice.  In any case where notice to Holders is given by mail, neither the failure to mail or receive such notice, nor any defect in any such notice, to any particular Holder shall affect the sufficiency or

 

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validity of such notice.  Where this Indenture provides for notice in any manner, such notice may be waived in writing by the Person entitled to receive such notice, either before or after the event, and such waiver shall be the equivalent of such notice.  Waivers of notice by Holders shall be filed with the Trustee, but such filing shall not be a condition precedent to the validity of any action taken in reliance upon such waiver.

 

In case by reason of the suspension of regular mail service or by reason of any other cause it shall be impracticable to give such notice by mail, then such notification as shall be made with the approval of the Trustee shall constitute a sufficient notification for every purpose hereunder.

 

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

 

SECTION 1.07 Conflict with Trust Indenture Act.  If any provision hereof limits, qualifies or conflicts with a provision of the Trust Indenture Act that is required under the Trust Indenture Act to be part of and govern this Indenture, such provision of the Trust Indenture Act shall control.  If any provision of this Indenture modifies or excludes any provision of the Trust Indenture Act that may be so modified or excluded, such provision shall be deemed to be so modified or excluded, as the case may be.

 

SECTION 1.08 Effect of Headings and Table of Contents.  The Article and Section headings herein and the Table of Contents are for convenience only and shall not affect the construction hereof.

 

SECTION 1.09 Successors and Assigns.  Without limiting Article VIII hereof, all covenants and agreements in this Indenture by the Company shall bind its respective successors and assigns, whether so expressed or not.

 

SECTION 1.10 Separability Clause.  In case any provision in this Indenture or in the Securities shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

 

SECTION 1.11 Benefits of Indenture.  Nothing in this Indenture or in the Securities, express or implied, shall give to any Person, other than the parties hereto and their successors hereunder and the Holders of Securities, any benefit or any legal or equitable right, remedy or claim under this Indenture.

 

SECTION 1.12 GOVERNING LAW.  THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

 

SECTION 1.13 Legal Holidays.  If the Stated Maturity Date or redemption date of a Security would fall on a day that is a legal holiday, then (notwithstanding any other provision of this Indenture or of the Securities) the required payment of interest, if any, and principal will be made on the next succeeding day that is not a legal holiday and no interest on such payment will accrue for the period from and after the Stated Maturity Date or redemption date to such next succeeding day that is not a legal holiday.

 

SECTION 1.14 Waiver of Jury Trial.  EACH OF THE COMPANY AND THE TRUSTEE HEREBY IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED

 

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BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE OR THE SECURITIES OR THE TRANSACTION CONTEMPLATED HEREBY.

 

SECTION 1.15 Force Majeure.  In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

 

SECTION 1.16 Counterparts.  This Indenture may be executed in any number of counterparts, each of which so executed shall be deemed to be an original, but all such counterparts shall together constitute but one and the same instrument.

 

SECTION 1.17 USA PATRIOT Act.  The parties hereto acknowledge that in accordance with Section 326 of the USA PATRIOT Act, the Trustee, like all financial institutions and in order to help fight the funding of terrorism and money laundering, is required to obtain, verify and record information that identifies each person or legal entity that establishes a relationship or opens an account with the Trustee. The parties to this 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 USA PATRIOT Act

 

ARTICLE II

 

Security Forms

 

SECTION 2.01 Form and Dating.  The Securities and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A hereto, which is hereby incorporated in and expressly made a part of this Indenture.  The Securities may have notations, legends or endorsements required by law, stock exchange rule, agreements to which the Company is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company).  Each Security shall be dated the date of its authentication.

 

(a)                                 Securities and Additional Securities.  The Securities issued on the date hereof will be offered and sold by the Company pursuant to the Company’s exchange offer for the outstanding 7.50% Exchangeable Senior Notes of the Operating Partnership settled on the date hereof.  Additional Securities offered after the date hereof may be offered and sold by the Company from time to time in accordance with applicable law.

 

(b)                                 Global Securities.  The Securities shall be issued initially in the form of one or more global Securities in definitive, fully registered form (each, a “Global Security”) without interest coupons and bearing the Global Securities Legend, which shall be deposited on behalf of the Holders of the Securities represented thereby with the Securities Custodian, and registered in the name of the Depositary or a nominee of the Depositary, duly executed by the Company and authenticated by the Trustee as provided in this Indenture.  The aggregate principal amount of any Global Securities may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depositary or its nominee and on the schedules thereto as hereinafter provided.  Notwithstanding the foregoing, the Company may, at any time and its sole discretion, determine not to have the Securities represented by a Global Security and, in such event, will issue the Securities in definitive form in exchange for the entire Global Security relating to the Securities.

 

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(c)                                  Book-Entry Provisions.  This Section 2.01(c) shall apply only to a Global Security deposited with or on behalf of the Depositary.

 

The Company shall execute and the Trustee shall, in accordance with this Section 2.01(c) and Section 2.02 and pursuant to an order of the Company signed by one officer of the Company, authenticate and deliver initially one or more Global Securities that (i) shall be registered in the name of the Depositary for such Global Security or Global Securities or the nominee of such Depositary and (ii) shall be delivered by the Trustee to such Depositary or pursuant to such Depositary’s instructions or held by the Trustee as Securities Custodian.

 

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

 

(d)                                 Definitive Securities. Except as provided in Section 2.03 or 2.04, owners of beneficial interests in Global Securities will not be entitled to receive physical delivery of certificated Securities.

 

SECTION 2.02 Authentication. The Trustee shall authenticate and make available for delivery upon a written order of the Company signed by an officer of the Company (a) Securities for original issue on the date hereof in an aggregate principal amount of $                   and (b) subject to the terms of this Indenture, Additional Securities in an unlimited aggregate principal amount.  Such order shall specify the amount of the Securities to be authenticated, the date on which the original issue of Securities is to be authenticated and, in the case of an issuance of Additional Securities pursuant to Section 3.13 of this Indenture after the Issue Date, shall certify that such issuance is in compliance with this Indenture.

 

SECTION 2.03 Transfer and Exchange. (a) Transfer and Exchange of Definitive Securities.  When Definitive Securities are presented to the Security Registrar with a request:

 

(i)                                     to register the transfer of such Definitive Securities; or

 

(ii)                                  to exchange such Definitive Securities for an equal principal amount of Definitive Securities of other authorized denominations,

 

the Security Registrar shall register the transfer or make the exchange as requested if its reasonable requirements for such transaction are met; provided, however, that the Definitive Securities surrendered for transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in form reasonably satisfactory to the Company and the Security Registrar, duly executed by the Holder thereof or his attorney duly authorized in writing.

 

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(b)                                 Restrictions on Transfer of a Definitive Security for a Beneficial Interest in a Global Security.  A Definitive Security may not be exchanged for a beneficial interest in a Global Security except upon satisfaction of the requirements set forth below.  Upon receipt by the Trustee of a Definitive Security, duly endorsed or accompanied by a written instrument of transfer in form reasonably satisfactory to the Company and the Security Registrar, together with written instructions directing the Trustee to make, or to direct the Securities Custodian to make, an adjustment on its books and records with respect the applicable Global Security to reflect an increase in the aggregate principal amount of the Securities represented by such Global Security, such instructions to contain information regarding the Depositary account to be credited with such increase, then the Trustee shall cancel such Definitive Security and cause, or direct the Securities Custodian to cause, in accordance with the standing instructions and procedures existing between the Depositary and the Securities Custodian, the aggregate principal amount of Securities represented by such Global Security to be increased by the aggregate principal amount of the Definitive Security to be exchanged and shall credit or cause to be credited to the account of the Person specified in such instructions a beneficial interest in such Global Security equal to the principal amount of the Definitive Security so canceled.  If no applicable Global Securities are then outstanding and the applicable Global Security has not been previously exchanged for certificated securities pursuant to Section 2.04, the Company shall issue and the Trustee shall authenticate, upon written order of the Company in the form of an Officers’ Certificate, a new applicable Global Security in the appropriate principal amount.

 

(c)                                  Transfer and Exchange of Global Securities.

 

(i)                                     The transfer and exchange of Global Securities or beneficial interests therein shall be effected through the Depositary, in accordance with this Indenture (including applicable restrictions on transfer set forth herein, if any) and the procedures of the Depositary therefor.  A transferor of a beneficial interest in a Global Security shall deliver a written order given in accordance with the Depositary’s procedures containing information regarding the participant account of the Depositary to be credited with a beneficial interest in such Global Security or another Global Security and such account shall be credited in accordance with such order with a beneficial interest in the applicable Global Security and the account of the Person making the transfer shall be debited by an amount equal to the beneficial interest in the Global Security being transferred.

 

(ii)                                  If the proposed transfer is a transfer of a beneficial interest in one Global Security to a beneficial interest in another Global Security, the Security Registrar shall reflect on its books and records the date and an increase in the principal amount of the Global Security to which such interest is being transferred in an amount equal to the principal amount of the interest to be so transferred, and the Security Registrar shall reflect on its books and records the date and a corresponding decrease in the principal amount of Global Security from which such interest is being transferred.

 

(iii)                               Notwithstanding any of the foregoing provisions (other than the provisions set forth in Section 2.04), a Global Security may not be transferred as a whole except by the Depositary to a nominee of the Depositary or by a nominee of the Depositary to the Depositary or another nominee of the Depositary or by the Depositary

 

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or any such nominee to a successor Depositary or a nominee of such successor Depositary.

 

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

 

(e)                                  Obligations with Respect to Transfers and Exchanges of Securities.

 

(i)                                     To permit registrations of transfers and exchanges, the Company shall execute and the Trustee shall authenticate, Definitive Securities and Global Securities at the Security Registrar’s request.

 

(ii)                                  No service charge shall be made for any registration of transfer or exchange of Securities except as provided in Section 3.06 of this Indenture, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Section 3.04 or 9.06 of this Indenture, and in any such case not involving any transfer.

 

(iii)                               Prior to the due presentation for registration of transfer of any Security, the Company, the Trustee, the Paying Agent or the Security Registrar may deem and treat the person in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest on such Security and for all other purposes whatsoever, whether or not such Security is overdue, and none of the Company, the Trustee, the Paying Agent or the Security Registrar shall be affected by notice to the contrary.

 

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

 

(f)                                   No Obligation of the Trustee.

 

(i)                                     The Trustee shall have no responsibility or obligation to any beneficial owner of a Global Security, a member of, or a participant in the Depositary or any other Person with respect to the accuracy of the records of the Depositary or its nominee or of any participant or member thereof, with respect to any ownership interest in the Securities or with respect to the delivery to any participant, member, beneficial owner or other Person (other than the Depositary) of any notice or the payment of any

 

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amount, under or with respect to such Securities.  All notices and communications to be given to the Holders and all payments to be made to Holders under the Securities shall be given or made only to the registered Holders (which shall be the Depositary or its nominee in the case of a Global Security).  The rights of beneficial owners in any Global Security shall be exercised only through the Depositary subject to the applicable rules and procedures of the Depositary.  The Trustee may rely and shall be fully protected in relying upon information furnished by the Depositary with respect to its members, participants and any beneficial owners.

 

(ii)                                  The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Security (including any transfers between or among Depositary participants, members or beneficial owners in any Global Security) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by, the terms of this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

 

(iii)                               Notwithstanding anything contained herein to the contrary, neither the Trustee nor the Security Registrar shall be responsible for ascertaining whether any transfer complies with the registration provisions of or exemptions from the Securities Act, applicable state securities laws, ERISA (or, in the case of a governmental plan or a church plan (as described in ERISA Sections 3(32) and 3(33), respectively) any substantially similar federal, state or local law), the Code or the Investment Company Act.

 

SECTION 2.04 Definitive Securities. (a) A Global Security deposited with the Depositary or with the Trustee as Securities Custodian pursuant to Section 2.01 shall be transferred to the beneficial owners thereof in the form of Definitive Securities in an aggregate principal amount equal to the principal amount of such Global Security, in exchange for such Global Security, only if such transfer complies with Section 2.03 and (i) the Depositary notifies the Company that it is unwilling or unable to continue as a Depositary for such Global Security or if at any time the Depositary ceases to be a “clearing agency” registered under the Exchange Act, and a successor depositary is not appointed by the Company within 90 days of such notice or after the Company becomes aware of such cessation or (ii) an Event of Default has occurred and is continuing.

 

(b)                                 Any Global Security that is transferable to the beneficial owners thereof pursuant to this Section 2.04 shall be surrendered by the Depositary to the Trustee, to be so transferred, in whole or from time to time in part, without charge, and the Trustee shall authenticate and deliver, upon such transfer of each portion of such Global Security, an equal aggregate principal amount of Definitive Securities of authorized denominations.  Any portion of a Global Security transferred pursuant to this Section shall be executed, authenticated and delivered only in denominations of $1,000 and any integral multiple thereof and registered in such names as the Depositary shall direct.

 

(c)                                  Subject to the provisions of Section 2.04(b), the registered Holder of a Global Security may grant proxies and otherwise authorize any Person, including Agent Members and Persons that may hold interests through Agent Members, to take any action which a Holder is entitled to take under this Indenture or the Securities.

 

(d)                                 In the event of the occurrence of any of the events specified in Section 2.04(a)(i) or (ii), the Company will promptly make available to the Trustee a reasonable supply of Definitive Securities in fully registered form without interest coupons.

 

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ARTICLE III

 

The Securities

 

SECTION 3.01 Title and Terms.  The aggregate principal amount of Securities which may be authenticated and delivered under this Indenture on the Issue Date is limited to $                   principal amount.  Additional Securities may be issued, authenticated and delivered pursuant to Section 3.13, and Securities may be authenticated and delivered upon registration or transfer of, or in exchange for, or in lieu of, other Securities pursuant to Sections 3.04, 3.05, 3.06 or 9.06.

 

The Securities shall be known and designated as the “3.00% Senior Notes due 2014” of the Company.  The Stated Maturity Date for payment of principal and interest shall be September 30, 2014.  Interest on the Securities shall accrue at the rate of 3.00% per annum and shall be payable on the Stated Maturity Date. Payment of interest will include interest accrued for the period, commencing on and including the date of original issuance of the Securities to but excluding the Stated Maturity Date.  Interest on the Securities will be computed on the basis of a 360-day year comprised of twelve 30-day months. Accrued and unpaid interest on the Securities will be payable in cash.

 

The Company shall pay the principal of and interest on any Global Security in immediately available funds to the Depositary or its nominee, as the case may be, as the registered Holder of such Global Security.  The Company has initially designated the Trustee as its Paying Agent and Security Registrar in respect of the Securities. The Company may, however, change the Paying Agent or Security Registrar for the Securities without prior notice to the Holders thereof and the Company may act as Paying Agent or Security Registrar for the Securities.

 

The Company may, at its option, on not less than 25 scheduled trading days’ notice prior to the Stated Maturity Date, elect to satisfy its obligation to repay, in whole but not in part, the principal amount of the Securities at the Stated Maturity Date by delivering Company Common Shares to Holders of the Securities in lieu of cash in accordance with Article XII hereof, unless (i) an Event of Default (as hereinafter defined) has occurred and is continuing or (ii) the Company Common Shares (including, for the avoidance of doubt, any security either issued in exchange for Company Common Shares or received by holders of Company Common Shares in a merger or consolidation involving the Company) have ceased to be listed on the New York Stock Exchange or another U.S. national securities exchange.

 

SECTION 3.02  Denominations.  The Securities shall be issuable only in registered form without coupons and only in denominations of $1,000 principal amount and any integral multiple of $1,000 thereof.

 

SECTION 3.03 Execution and Authentication.  The terms and provisions contained in the Form of Securities annexed hereto as Exhibit A shall constitute, and are hereby expressly made, a part of this Indenture and, to the extent applicable, the Company and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.  The Securities shall be executed on behalf of the Company

 

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by its Chief Executive Officer, Chief Financial Officer, General Counsel, Treasurer or any Executive or Senior Vice President.  The signature of any of these officers on the Securities may be manual or facsimile (including electronic).

 

Securities bearing the manual or facsimile signatures of individuals who were at any time the proper officers of the Company shall bind the Company, notwithstanding that such individuals or any of them have ceased to hold such offices prior to the authentication and delivery of such Securities or did not hold such offices at the date of such Securities.

 

At any time and from time to time after the execution and delivery of this Indenture, the Company may deliver Securities executed by the Company to the Trustee for authentication, together with a Company Order for the authentication and delivery of such Securities, which shall specify the amount of the Securities to be authenticated and the date on which the original issue of Securities is to be authenticated and, in the case of an issuance of Additional Securities pursuant to Section 3.13 after the Issue Date, shall certify that such issuance is in compliance with this Indenture; and the Trustee in accordance with such Company Order shall authenticate and deliver such Securities as provided in this Indenture and not otherwise.

 

Each Security shall be dated the date of its authentication.

 

No Security shall be entitled to any benefit under this Indenture or be valid or obligatory for any purpose unless there appears on such Security a certificate of authentication substantially in the form provided for herein executed by the Trustee by manual signature, and such certificate upon any Security shall be conclusive evidence, and the only evidence, that such Security has been duly authenticated and delivered hereunder.

 

Authentication by counterpart shall satisfy the requirements of this Section 3.03 and the requirements of the Securities.

 

SECTION 3.04 Temporary Securities.  Pending the preparation of Definitive Securities, the Company may execute, and upon Company Order the Trustee shall authenticate and deliver, temporary Securities which are printed, lithographed, typewritten, mimeographed or otherwise produced, in any authorized denomination, substantially of the tenor of the Definitive Securities in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other variations as the officers executing such Securities may determine, as evidenced by their execution of such Securities.

 

If temporary Securities are issued, the Company will cause Definitive Securities to be prepared without unreasonable delay.  After the preparation of Definitive Securities, the temporary Securities shall be exchangeable for Definitive Securities upon surrender of the temporary Securities at any office or agency of the Company designated pursuant to Section 10.02, without charge to the Holder.  Upon surrender for cancellation of any one or more temporary Securities, the Company shall execute and the Trustee shall authenticate and deliver in exchange therefor a like principal amount of Definitive Securities of authorized denominations and of a like tenor.  Until so exchanged, the temporary Securities shall in all respects be entitled to the same benefits under this Indenture as Definitive Securities.

 

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SECTION 3.05 Registration, Registration of Transfer and Exchange.  The Company shall cause to be kept at the Corporate Trust Office of the Trustee a register (the register maintained in such office and in any other office or agency designated pursuant to Section 10.02 being herein sometimes collectively referred to as the “Security Register”) in which, subject to such reasonable regulations as the Company may prescribe, the Company shall provide for the registration of Securities and of transfers of Securities.  The Trustee is hereby appointed (a) the initial “Security Registrar” for the purpose of registering Securities and transfers of Securities as herein provided and (b) the Securities Custodian with respect to the Global Securities.

 

The Securities shall be issued in registered form and shall be transferable only upon the surrender of a Security for registration of transfer and in compliance with Article II.  When a Security is presented to the Security Registrar with a request to register a transfer, the Security Registrar shall register the transfer as requested if its requirements therefor are met.  When Securities are presented to the Security Registrar with a request to exchange them for an equal principal amount of Securities of other denominations, the Security Registrar shall make the exchange as requested if the same requirements are met.  To permit registration of transfers and exchanges, the Company shall execute and the Trustee shall authenticate Securities at the Security Registrar’s request.

 

All Securities issued upon any registration of transfer or exchange pursuant to the terms of this Indenture shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under this Indenture, as the Securities surrendered upon such registration of transfer or exchange.

 

No service charge shall be made for any registration of transfer or exchange of Securities except as provided in Section 3.06, but the Company may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Securities, other than exchanges pursuant to Sections 3.04 and 9.06, and in any such case not involving any transfer.

 

Prior to the due presentation for registration of transfer of any Security, the Company, the Trustee, the Paying Agent, and the Security Registrar may deem and treat the Person in whose name a Security is registered as the absolute owner of such Security for the purpose of receiving payment of principal of and interest, if any, on such Security and for all other purposes whatsoever, whether or not such Security is overdue, and none of the Company, the Trustee, the Paying Agent, or the Security Registrar shall be affected by notice to the contrary.

 

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

 

SECTION 3.06 Mutilated, Destroyed, Lost and Stolen Securities.  If any mutilated Security is surrendered to the Trustee, the Company shall execute and the Trustee shall

 

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authenticate and deliver in exchange therefor a new Security of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

If there shall be delivered to the Company and the Trustee (i) evidence to their satisfaction of the destruction, loss or theft of any Security and (ii) such security or indemnity as may be required by them to save each of them and any agent of each of them harmless, then, in the absence of notice to the Company or the Trustee that such Security has been acquired by a bona fide purchaser, the Company shall execute, and upon its request the Trustee shall authenticate and deliver, in lieu of any such destroyed, lost or stolen Security, a new Security of like tenor and principal amount and bearing a number not contemporaneously outstanding.

 

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

 

Upon the issuance of any new Security under this Section, the Company may require the payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in relation thereto and any other expenses (including the fees and expenses of the Trustee) connected therewith.

 

Every new Security issued pursuant to this Section in lieu of any destroyed, lost or stolen Security shall constitute an original additional contractual obligation of the Company, whether or not the destroyed, lost or stolen Security shall be at any time enforceable by anyone, and shall be entitled to all the benefits of this Indenture equally and proportionately with any and all other Securities duly issued hereunder.

 

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

 

SECTION 3.07 Payment of Interest; Rights Preserved.  Interest on any Security which is payable, and is punctually paid or duly provided for, on the Stated Maturity Date shall be paid to the Person in whose name that Security (or one or more predecessor securities) is registered at the Close of Business on the Stated Maturity Date.

 

Any interest on any Security which is payable, but is not punctually paid or duly provided for, on the Stated Maturity Date (herein called “Defaulted Interest”) shall forthwith cease to be payable to the Holder, and such Defaulted Interest may be paid by the Company, at its election in each case, as provided in paragraph (a) or (b) below:

 

(a)                                 the Company may elect to make payment of any Defaulted Interest to the Persons in whose names the Securities (or their respective predecessor Securities) are registered at the Close of Business on a Special Record Date for the payment of such Defaulted Interest, which shall be fixed in the following manner:  the Company shall notify the Trustee in writing of the amount of Defaulted Interest proposed to be paid on each Security and the date of the proposed payment, and at the same time the Company shall deposit with the Trustee an amount of money equal to the aggregate amount proposed to be paid in respect of such Defaulted Interest or shall make arrangements satisfactory to the Trustee for such deposit prior to the date

 

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of the proposed payment, such money when deposited to be held in trust for the benefit of the Persons entitled to such Defaulted Interest as in this clause provided.  Thereupon the Company shall fix a Special Record Date for the payment of such Defaulted Interest which shall be not more than 15 days and not less than 10 days prior to the date of the proposed payment and not less than 15 days after the receipt by the Trustee of the notice of the proposed payment.  The Company shall promptly notify the Trustee of such Special Record Date and shall cause notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor to be given to each Holder in the manner specified in Section 1.06, not less than 10 days prior to such Special Record Date.  Notice of the proposed payment of such Defaulted Interest and the Special Record Date therefor having been so mailed, such Defaulted Interest shall be paid to the Persons in whose names the Securities (or their respective predecessor Securities) are registered at the Close of Business on such Special Record Date and shall no longer be payable pursuant to the following clause (b).

 

(b)                                 the Company may make payment of any Defaulted Interest 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, if, after notice given by the Company to the Trustee of the proposed payment pursuant to this clause (b), such manner of payment shall be deemed practicable by the Trustee.

 

Subject to the foregoing provisions of this Section and Section 3.05, each Security delivered under this Indenture upon registration of transfer of or in exchange for or in lieu of any other Security shall carry the rights to interest accrued and unpaid, and to accrue, which were carried by such other Security.

 

The Company is permitted to withhold from interest payments otherwise payable to a Holder for any amounts the Company is required to withhold by law.

 

SECTION 3.08 Persons Deemed Owners.  Prior to due presentment of a Security for registration of transfer, the Company, the Trustee and any agent of the Company or the Trustee shall treat the Person in whose name such Security is registered as the owner of such Security for the purpose of receiving payment of principal of and (subject to Section 3.07) interest on such Security and for all other purposes whatsoever, whether or not such Security be overdue, and neither the Company, the Trustee nor any agent of the Company or the Trustee shall be affected by notice to the contrary.

 

SECTION 3.09 Cancellation.  All Securities surrendered for payment, redemption, registration of transfer or exchange shall, if surrendered to any Person other than the Trustee, be delivered to the Trustee and shall be promptly cancelled by it.  The Company shall promptly deliver to the Trustee for cancellation any Securities previously authenticated and delivered hereunder which the Company may have acquired in any manner whatsoever, and all Securities so delivered shall be promptly cancelled by the Trustee.  No Securities shall be authenticated in lieu of or in exchange for any Securities cancelled as provided in this Section, except as expressly permitted by this Indenture.  All cancelled Securities held by the Trustee shall be disposed of by the Trustee in its customary manner.

 

SECTION 3.10 Computation of Interest.  Interest on the Securities shall be computed on the basis of a 360-day year comprised of twelve 30-day months.

 

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SECTION 3.11 CUSIP Numbers.  The Company in issuing the Securities may use “CUSIP” and the Trustee shall use the CUSIP numbers in notices of redemption as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness of such numbers either as printed on the Securities or as contained in any notice of a redemption and that reliance may be placed only on the other identification numbers printed on the Securities, and any such redemption shall not be affected by any defect in or omission of such numbers.  The Company shall promptly notify the Trustee of any change in the CUSIP numbers.

 

SECTION 3.12 Deposits of Monies.  Except to the extent payment is made by the Company’s check or wire transfer pursuant to the terms of the Securities, prior to 11:00 a.m., New York City time, on the Stated Maturity Date, the Company shall deposit with the Paying Agent in immediately available funds money sufficient to make cash payments due on the Stated Maturity Date in a timely manner which permits the Paying Agent to remit payment to the Holders on such Stated Maturity Date.

 

SECTION 3.13 Issuance of Additional Securities.  The Company shall be entitled, subject to its compliance with this Indenture, to issue Additional Securities under this Indenture which shall have identical terms as the Securities issued on the Issue Date, other than with respect to the date of issuance and issue price provided, however, that no Additional Securities shall be issued that are not fungible for U.S.  Federal income tax purposes, with any other securities issued under this Indenture.  The Securities issued on the Issue Date and any Additional Securities shall be treated as a single class for all purposes under this Indenture.

 

With respect to any Additional Securities, the Company shall set forth in a resolution of its Board of Directors and an Officers’ Certificate, a copy of each which shall be delivered to the Trustee, the following information:

 

(a)                                 whether such Additional Securities shall be issued as part of a new or existing series of Securities and the title of such Additional Securities (which shall distinguish the Additional Securities of the series from Securities of any other series);

 

(b)                                 the aggregate principal amount of such Additional Securities which may be authenticated and delivered under this Indenture, which may be in an unlimited aggregate principal amount;

 

(c)                                  the issue price and issuance date of such Additional Securities, including the date from which interest on such Additional Securities shall accrue; and

 

(d)                                 if applicable, that such Additional Securities shall be issuable in whole or in part in the form of one or more Global Securities and, in such case, the respective depositaries for such Global Securities, the form of any legend or legends which shall be borne by such Global Securities in addition to or in lieu of those set forth in Exhibit A hereto and any circumstances in addition to or in lieu of those set forth in Section 2.04 in which any such Global Security may be exchanged in whole or in part for Additional Securities registered, or any transfer of such Global Security in whole or in part may be registered, in the name or names of Persons other than the depositary for such Global Security or a nominee thereof.

 

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ARTICLE IV

 

Satisfaction and Discharge

 

SECTION 4.01 Satisfaction and Discharge of Indenture.  This Indenture shall cease to be of further effect (except as to any surviving rights of registration of transfer or exchange of Securities herein expressly provided for), and the Trustee, on demand of and at the expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture, when:

 

(i)                                     the Company shall deliver to the Security Registrar for cancellation all Securities theretofore authenticated (other than any Securities that have been destroyed, lost or stolen and in lieu of or in substitution for which other Securities shall have been authenticated and delivered) and not theretofore canceled; or

 

(ii)                                  all Securities not theretofore canceled or delivered to the Trustee for cancellation shall have become due and payable at the Stated Maturity Date for the payment of the principal amount thereof or on any Change in Control Purchase Date,

 

and the Company shall deposit with the Trustee, in trust, or deliver to the Holders cash funds or Company Common Shares, as applicable, sufficient to pay all amounts due on all of such Securities (other than any Securities that shall have been mutilated, destroyed, lost or stolen and in lieu of or in substitution for which other Securities shall have been authenticated and delivered) not theretofore canceled or delivered to the Trustee for cancellation, including principal and interest due, accompanied, except in the event the Securities are due and payable solely in cash or Company Common Shares at the Stated Maturity Date or upon an earlier Change in Control Purchase Date, by a verification report as to the sufficiency of the deposited amount from an independent certified accountant or other financial professional reasonably satisfactory to the Trustee, and if the Company shall also pay or cause to be paid all other sums payable hereunder by the Company, then this Indenture shall cease to be of further effect (except as to (A) rights hereunder of Holders of the Securities to receive all amounts owing upon the Securities and the other rights, duties and obligations of Holders of the Securities, as beneficiaries hereof with respect to the amounts, if any, so deposited with the Trustee and (B) the rights, obligations and immunities of the Trustee hereunder), and the Trustee, on written demand of the Company accompanied by an Officers’ Certificate and an Opinion of Counsel and at the cost and expense of the Company, shall execute proper instruments acknowledging satisfaction and discharge of this Indenture.

 

Notwithstanding the satisfaction and discharge of this Indenture pursuant to this Article IV, the obligations of the Company to the Trustee under Section 6.07, the obligations of the Company to any Authenticating Agent under Section 6.14 and, if money shall have been deposited with the Trustee pursuant to the preceding paragraph of this Section 4.01, the obligations of the Trustee under Section 4.02 and the last paragraph of Section 10.03 shall survive such satisfaction and discharge.

 

SECTION 4.02 Application of Trust Money.  Subject to the provisions of the last paragraph of Section 10.03, all money deposited with the Trustee pursuant to Section 4.01 shall 

 

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be held in trust and applied by it, in accordance with the provisions of the Securities and this Indenture, to the payment, either directly or through any Paying Agent (including the Company acting as its own Paying Agent) as the Trustee may determine, to the Persons entitled thereto, of the principal and interest for whose payment such money has been deposited with the Trustee

 

SECTION 4.03 Paying Agent to Repay Monies Held.  Upon the satisfaction and discharge of this Indenture, all monies then held by any Paying Agent (if other than the Trustee) shall, upon written request of the Company, be repaid to it or paid to the Trustee, and thereupon such Paying Agent shall be released from all further liability with respect to such monies.

 

SECTION 4.04 Reinstatement.  If the Trustee or the Paying Agent is unable to apply any money in accordance with Section 4.02 by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, the Company’s obligations under the Indenture and the Securities shall be revived and reinstated as though no deposit had occurred pursuant to Section 4.01 until such time as the Trustee or the Paying Agent is permitted to apply all such money in accordance with Section 4.02; provided, however, that if the Company makes any payment of interest on or principal of any Security following the reinstatement of its obligations, the Company shall be subrogated to the rights of the Holders of such Securities to receive such payment from the money held by the Trustee or Paying Agent.

 

ARTICLE V

 

Remedies

 

SECTION 5.01 Events of Default. “Event of Default,” wherever used herein, means any one of the following events (whatever the reason for such Event of Default and whether it shall be voluntary or involuntary or be effected by operation of law or pursuant to any judgment, decree or order of any court or any order, rule or regulation of any administrative or governmental body):

 

(a)                                 default in the payment of the principal of the Securities (at Stated Maturity Date or otherwise) or, if the Company has elected Share Settlement pursuant to Article XII, the Company does not deliver Company Common Shares, in accordance with the terms of Article XII; or

 

(b)                                 default in the payment of interest on any of the Securities, when due and payable, for 30 days; or

 

(c)                                  default in the performance, or breach, of any covenant or agreement of the Company under this Indenture and such default or breach shall continue for a period of 60 days after written notice has been given, by registered or certified mail:

 

(x)                                 to the Company by the Trustee; or

 

(y)                                 to the Company and the Trustee by the holders of at least 25% in aggregate principal amount of the Securities;

 

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Such written notice shall specify such default or breach and require it to be remedied, stating that such notice is a “Notice of Default” hereunder.

 

(d)                                 default by the Company, the Operating Partnership or Sub-REIT, as the case may be, under any bond, debenture, note or other evidence of indebtedness for money borrowed by the Company, the Operating Partnership or Sub-REIT, as the case may be, having an aggregate principal amount outstanding of at least $50,000,000, or under any mortgage, indenture or instrument (including this Indenture) under which there may be issued or by which there may be secured or evidenced any indebtedness for money borrowed by the Company, the Operating Partnership or Sub-REIT, as the case may be, having an aggregate principal amount outstanding of at least $50,000,000, whether such indebtedness now exists or shall hereafter be created, which default, after the expiration of any grace period, (A) shall constitute a failure to pay any portion of the principal of such indebtedness when due and payable after the expiration of any applicable grace period with respect thereto or (B) shall have resulted in such indebtedness becoming or being declared due and payable prior to the date on which it would otherwise have become due and payable, without, in the case of Clause (A), such indebtedness having been discharged or without, in the case of Clause (B), such indebtedness having been discharged or such acceleration having been rescinded or annulled, in each such case after there shall have been given, by registered or certified mail, to the Company by the Trustee or to the Company and the Trustee by the Holders of at least 25% in principal amount of the Securities a written notice specifying such default and requiring the Company, the Operating Partnership or Sub-REIT, as the case may be, to cause such indebtedness to be discharged or cause such acceleration to be rescinded or annulled, as the case may be, and stating that such notice is a “Notice of Default” hereunder; provided, that, the Trustee shall not be deemed to have knowledge of such default unless either (A) a Responsible Officer of the Trustee shall have knowledge of such default or (B) the Trustee shall have received written notice thereof from the Company, from any Holder, from the holder of any such indebtedness or from the trustee under any such mortgage, indenture or other instrument; or

 

(e)                                  the Company, the Operating Partnership or Sub-REIT, as the case may be, shall fail to pay a final, non-appealable judgment entered by a court of competent jurisdiction against the Company, the Operating Partnership or Sub-REIT, as the case may be, in excess of $50,000,000, which judgment is not paid, discharged or stayed within 60 days after such judgment becomes final and non-appealable; or

 

(f)                                   the institution by the Company, the Operating Partnership or Sub-REIT of a voluntary case or proceeding under the Federal Bankruptcy Code or any other similar federal, state or foreign law or any other case or proceedings to be adjudicated a bankrupt or insolvent, or the consent by the Company, the Operating Partnership or Sub-REIT to the entry of a decree or order for relief in respect of the Company, the Operating Partnership or Sub-REIT in any involuntary case or proceeding under the Federal Bankruptcy Code or any other similar federal, state or foreign law or to the institution of bankruptcy or insolvency proceedings against the Company, the Operating Partnership or Sub-REIT, or the filing by the Company, the Operating Partnership or Sub-REIT of a petition or answer or consent seeking reorganization or relief under the Federal Bankruptcy Code or any other similar federal, state or foreign law, or the consent by it to the filing of any such petition or to the 

 

27

 

appointment of or taking possession by a custodian, receiver, liquidator, assignee, trustee or sequestrator (or other similar official) of any of the Company, the Operating Partnership or Sub-REIT or of any substantial part of its property, or the making by it of an assignment for the benefit of creditors, or the admission by it in writing of its inability to pay its debts generally as they become due or the taking of corporate action by the Company, the Operating Partnership or Sub-REIT in furtherance of any such action.

 

SECTION 5.02 Acceleration of Maturity; Rescission and Annulment.  If an Event of Default (other than those covered by clause (f) of Section 5.01 with respect to the Company) shall occur and be continuing, the Trustee, by written notice to the Company (and to the Trustee if given by the Holders), or the Holders of at least 25% in aggregate principal amount of the Securities then Outstanding, by notice to the Trustee and the Company, may declare the principal of and accrued and unpaid interest, if any, on all of the Outstanding Securities due and payable immediately, upon which declaration, all amounts payable in respect of the Securities shall be due and payable as of the date which is five Business Days after the giving of such notice.  If an Event of Default specified in clause (f) of Section 5.01 with respect to the Company occurs and is continuing, then the principal of and accrued and unpaid interest, if any, on all the Outstanding Securities shall ipso facto become and be immediately due and payable without any declaration or other act on the part of the Trustee or any Holder of Securities.

 

After a declaration of acceleration under this Indenture, but before a judgment or decree for payment of the money due has been obtained by the Trustee, the Holders of a majority in aggregate principal amount of the Outstanding Securities, by written notice to the Company and the Trustee, may rescind such declaration if:

 

(a)                                 the Company has paid or deposited with the Trustee a sum sufficient to pay:

 

(i)                                     all sums paid or advanced by the Trustee under this Indenture and the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel;

 

(ii)                                  all overdue interest on all Securities;

 

(iii)                               the principal of any Securities which have become due otherwise than by such declaration of acceleration and interest thereon at the rate borne by the Securities; and

 

(iv)                              to the extent that payment of such interest is lawful, interest upon overdue interest and overdue principal at the rate set forth in the Securities which has become due otherwise than by such declaration of acceleration;

 

(b)                                 the rescission would not conflict with any judgment or decree of a court of competent jurisdiction; and

 

(c)                                  all Events of Default, other than the non-payment of principal of and interest on the Securities that have become due solely by such declaration of acceleration, have been cured or waived.

 

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No such rescission shall affect any subsequent default or impair any right consequent thereto.

 

SECTION 5.03 Collection of Indebtedness and Suits for Enforcement by Trustee.  The Company covenants that if:

 

(a)                                 default is made in the payment of any interest on any Security when such interest becomes due and payable and such default continues for a period of 30 days, or

 

(b)                                 default is made in the payment of the principal of any Security on the due date for payment thereof, including with respect to any Security required to have been purchased pursuant to a Change in Control Offer, on the Change in Control Purchase Date

 

the Company will, upon demand of the Trustee, pay to it, for the benefit of the Holders of such Securities, the whole amount then due and payable on such Securities for principal and interest, and, to the extent that payment of such interest shall be legally enforceable, interest on any overdue principal and on any overdue interest, at the rate provided by the Securities, and, in addition thereto, such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

 

In addition to the rights and powers set forth in Section 317(a) of the Trust Indenture Act, the Trustee shall be entitled to file such other papers or documents as may be necessary or advisable in order to have the claims of the Trustee and of the Holders of the Securities allowed in any judicial proceeding relative to the Company or any other obligor upon the Securities, its creditors, or its property, and to collect and receive any moneys or other property payable or deliverable on any such claims, and to distribute the same after the deduction of its charges and expenses; and any receiver, assignee or trustee in bankruptcy or reorganization is hereby authorized by each of the Holders to make such payments to the Trustee, and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for compensation and expenses, including counsel fees incurred by it up to the date of such distribution.

 

If an Event of Default occurs and is continuing, the Trustee may in its discretion proceed to protect and enforce its rights and the rights of the Holders by such appropriate judicial proceedings as the Trustee shall deem necessary to protect and enforce any such rights, whether for the specific enforcement of any covenant or agreement in this Indenture or in aid of the exercise of any power granted herein, or to enforce any other proper remedy.

 

SECTION 5.04 Trustee May File Proofs of Claim.  In case of any judicial proceeding relative to the Company (or any other obligor upon the Securities), any of its property or any of its creditors, the Trustee shall be entitled and empowered, by intervention in such proceeding or otherwise, to take any and all actions authorized under the Trust Indenture Act in order to have claims of the Holders and the Trustee allowed in any such proceeding.  In particular, the Trustee shall be authorized to collect and receive any moneys or other property payable or deliverable on any such claims and to distribute the same; and any custodian, receiver, assignee, trustee, liquidator, sequestrator or other similar official in any such judicial 

 

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proceeding is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel, and any other amounts due the Trustee under Section 6.07.

 

No provision of this Indenture shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Securities or the rights of any Holder thereof or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding; provided, however, that the Trustee may, on behalf of the Holders, vote for the election of a trustee in bankruptcy or similar official and be a member of a creditors’ or other similar committee.

 

SECTION 5.05 Trustee May Enforce Claims Without Possession of Securities.  All rights of action and claims under this Indenture or the Securities may be prosecuted and enforced by the Trustee without the possession of any of the Securities or the production thereof in any proceeding relating thereto, and any such proceeding instituted by the Trustee shall be brought in its own name as trustee of an express trust, and any recovery of judgment shall, after provision for the payment of the reasonable compensation, expenses, distributions and advances of the Trustee, its agents and counsel, be for the ratable benefit of the Holders of the Securities in respect of which such judgment has been recovered.

 

SECTION 5.06 Application of Money Collected.  Any money collected by the Trustee pursuant to this Article shall be applied in the following order, at the date or dates fixed by the Trustee and, in case of the distribution of such money on account of principal or interest, upon presentation of the Securities and the notation thereon of the payment if only partially paid and upon surrender thereof if fully paid:

 

FIRST: To the payment of all amounts due the Trustee hereunder;

 

SECOND: To the payment of the amounts then due and unpaid for principal of and interest on the Securities in respect of which or for the benefit of which such money has been collected, ratably, without preference or priority of any kind, according to the amounts due and payable on such Securities for principal and interest, respectively;

 

THIRD: To the payment of any and all other amounts due under this Indenture or the Securities; and

 

FOURTH: To the Company (or such other Person as a court of competent jurisdiction may direct).

 

SECTION 5.07 Limitation on Suits.  Subject to Section 5.08, no Holder of any Security shall have any right to institute any proceeding, judicial or otherwise, with respect to this Indenture, or for the appointment of a receiver or trustee, or for any other remedy hereunder, unless:

 

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

 

(b)                                 the Holders of not less than 25% in principal amount of the Outstanding Securities shall have made written request to the Trustee to institute proceedings in respect of such Event of Default in its own name as Trustee hereunder;

 

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

 

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

 

(e)                                  no direction inconsistent with such written request has been given to the Trustee during such 60-day period by the Holders of a majority in principal amount of the Outstanding Securities; it being understood and intended that no one or more Holders shall have any right in any manner whatever by virtue of, or by availing of, any provision of this Indenture to affect, disturb or prejudice the rights of any other Holders, or to obtain or to seek to obtain priority or preference over any other Holders or to enforce any right under this Indenture, except in the manner herein provided and for the equal and ratable benefit of all the Holders.

 

SECTION 5.08 Unconditional Right of Holders to Receive Principal and Interest.  Notwithstanding any other provision in this Indenture, the Holder of any Security shall have the right, which is absolute and unconditional, to receive payment of the principal of and (subject to Section 3.07) interest on such Security on the Stated Maturity Date expressed in such Security and to institute suit for the enforcement of any such payment, and such rights shall not be impaired without the consent of such Holder.

 

SECTION 5.09 Restoration of Rights and Remedies.  If the Trustee or any Holder has instituted any proceeding to enforce any right or remedy under this Indenture and such proceeding has been discontinued or abandoned for any reason, or has been determined adversely to the Trustee or to such Holder, then and in every such case, subject to any determination in such proceeding, the Company, the Trustee and the Holders shall be restored severally and respectively to their former positions hereunder and thereafter all rights and remedies of the Trustee and the Holders shall continue as though no such proceeding had been instituted, subject to the determination in such proceeding.

 

SECTION 5.10 Rights and Remedies Cumulative.  Except as otherwise provided with respect to the replacement or payment of mutilated, destroyed, lost or stolen Securities in the last paragraph of Section 3.06, no right or remedy herein conferred upon or reserved to the Trustee or to the Holders is intended to be exclusive of any other right or remedy, and every right and remedy shall, to the extent permitted by law, be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other appropriate right or remedy.

 

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SECTION 5.11 Delay or Omission Not Waiver.  No delay or omission of the Trustee or of any Holder of any Security to exercise any right or remedy accruing upon any Event of Default shall impair any such right or remedy or constitute a waiver of any such Event of Default or an acquiescence therein.  Every right and remedy given by this Article or by law to the Trustee or to the Holders may be exercised from time to time, and as often as may be deemed expedient, by the Trustee or by the Holders, as the case may be.

 

SECTION 5.12 Control by Holders.  The Holders of a majority in principal amount of the Outstanding Securities shall have the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on the Trustee, provided that:

 

(a)                                 such direction shall not be in conflict with any rule of law or with this Indenture, and

 

(b)                                 the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

 

SECTION 5.13 Waiver of Past Defaults.  The Holders of not less than a majority in principal amount of the Outstanding Securities may on behalf of the Holders of all the Securities waive any past default hereunder and its consequences, except a default:

 

(a)                                 in the payment of the principal of or interest on any Security (including any Security required to have been purchased pursuant to a Change in Control Offer) or

 

(b)                                 in respect of a covenant or provision hereof which under Article IX cannot be modified or amended without the consent of the Holder of each Outstanding Security affected.

 

Upon any such waiver, such default shall cease to exist, and any Event of Default arising therefrom shall be deemed to have been cured, for every purpose of this Indenture; but no such waiver shall extend to any subsequent or other default or impair any right consequent thereon.

 

SECTION 5.14 Undertaking for Costs.  In any suit for the enforcement of any right or remedy under this Indenture, or in any suit against the Trustee for any action taken, suffered or omitted by it as Trustee, a court may require any party litigant in such suit to file an undertaking to pay the costs of such suit (including reasonable counsel fees and expenses), and may assess costs against any such party litigant, in the manner and to the extent provided in the Trust Indenture Act; provided, that neither this Section nor the Trust Indenture Act shall be deemed to authorize any court to require such an undertaking or to make such an assessment in any suit instituted by the Company, in any suit instituted by the Trustee, in any suit instituted by any Holder or group of Holders, holding in the aggregate more than 10% in principal amount of the Outstanding Securities, or in any suit instituted by any Holder for the enforcement of the payment of the principal of or interest on any Security on or after the Stated Maturity Date expressed in such Security (or, in the case of a Change in Control Offer, on or after the Change in Control Purchase Date).

 

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SECTION 5.15 Waiver of Stay or Extension Laws.  The Company covenants (to the extent that it may lawfully do so) that it will not at any time insist upon, or plead, or in any manner whatsoever claim or take the benefit or advantage of, any usury, stay or extension law wherever enacted, now or at any time hereafter in force, which may affect the covenants or the performance of this Indenture; and the Company (to the extent that it may lawfully do so) hereby expressly waives all benefit or advantage of any such law and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

 

ARTICLE VI

 

The Trustee

 

SECTION 6.01 Certain Duties and Responsibilities. (a) Except during the continuance of an Event of Default,

 

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

 

(ii)                                  in the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates or opinions furnished to the Trustee and conforming to the requirements of this Indenture; but in the case of any such certificates or opinions which by the provisions hereof are specifically required to be furnished to the Trustee, the Trustee shall be under a duty to examine the same to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

 

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

 

(c)                                  No provision of this Indenture shall be construed to relieve the Trustee from liability for its own negligent misconduct, except that no provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder, or in the exercise of any of its rights or powers under this Indenture, unless the Trustee has received security and indemnity satisfactory to it against any loss, liability or expense.  The Trustee shall not be liable for any error of judgment unless it is proved that the Trustee was negligent in the performance of its duties hereunder.

 

(d)                                 Whether or not therein expressly so provided, every provision of this Indenture relating to the conduct or affecting the liability of or affording protection to the Trustee shall be subject to the provisions of this Section 6.01.

 

SECTION 6.02 Notice of Defaults.  If a Default or an Event of Default occurs and is known to the Trustee, the Trustee shall transmit by mail to all Holders, as their names and 

 

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addresses appear in the Security Register, notice of such Default or Event of Default hereunder known to the Trustee within 90 days after a Default or Event of Default, or, if later, within 15 days after it becomes known to the Trustee, unless such Default shall have been cured or waived; provided, however, that, except in the case of a Default or an Event of Default in the payment of the principal of or interest on any Security, the Trustee shall be protected in withholding such notice if and so long as the board of directors, the executive committee or a trust committee of directors or Responsible Officers of the Trustee in good faith determines that the withholding of such notice is in the interest of the Holders.

 

SECTION 6.03 Certain Rights of Trustee.  Subject to the provisions of Section 6.01:

 

(a)                           the Trustee may conclusively rely as to the truth of the statements and correctness of the opinions expressed therein and shall be fully protected in acting or refraining from acting upon any resolution, Officers’ Certificate, certificate of auditors or any other certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document believed by it to be genuine and to have been signed or presented by the proper party or parties;

 

(b)                                 any request or direction of the Company mentioned herein shall be sufficiently evidenced by a Company Request or Company Order and any resolution of the Board of Directors of the Company may be sufficiently evidenced by a Board Resolution of the Company;

 

(c)                                  whenever in the administration of this Indenture the Trustee shall deem it desirable that a matter be proved or established prior to taking, suffering or omitting any action hereunder, the Trustee (unless other evidence be herein specifically prescribed) may, in the absence of bad faith on its part, rely upon an Officers’ Certificate;

 

(d)                                 the Trustee may consult with counsel of its selection and the advice of such counsel or any Opinion of Counsel shall be full and complete authorization and protection in respect of any action taken, suffered or omitted by it hereunder in good faith and in reliance thereon;

 

(e)                                  the Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request or direction of any of the Holders pursuant to this Indenture, unless such Holders shall have offered to the Trustee security or indemnity reasonably satisfactory to the Trustee against the costs, expenses and liabilities which might be incurred by it in compliance with such request or direction;

 

(f)                                   the Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate, statement, instrument, opinion, report, notice, request, direction, consent, order, bond, debenture, note, other evidence of indebtedness or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit, and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled (subject to reasonable confidentiality arrangements as may be proposed by the Company) to make reasonable

 

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examination (upon prior notice and during regular business hours) of the books, records and premises of the Company, personally or by agent or attorney at the sole cost of the Company and shall incur no liability or additional liability of any kind by reason of such inquiry or investigation;

 

(g)                                  the Trustee may execute any of the trusts or powers hereunder or perform any duties hereunder either directly or by or through agents or attorneys or custodians or nominees and the Trustee shall not be responsible for the supervision of, or any misconduct or negligence on the part of, any agent or attorney appointed with due care by it hereunder;

 

(h)                                 the Trustee shall not be liable for any action taken, suffered, or omitted to be taken by it in good faith and reasonably believed by it to be authorized or within the discretion or rights or powers conferred upon it by this Indenture;

 

(i)                                     in the event that the Trustee is also acting as Authenticating Agent, Paying Agent, Security Registrar or Securities Custodian hereunder, the rights and protections afforded to the Trustee pursuant to this Article VI, including its right to be indemnified, shall also be afforded to such Authenticating Agent, Paying Agent, Security Registrar and Securities Custodian;

 

(j)                                    the Trustee shall not be deemed to have notice of any Default or Event of Default unless a Responsible Officer of the Trustee has actual knowledge thereof or unless written notice of any event which is in fact such a default and stating such notice is a “Notice of Default” is received by the Trustee at the Corporate Trust Office of the Trustee, and such notice references the Securities and this Indenture;

 

(k)                                 in no event shall the Trustee be responsible or liable for punitive, special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action; and

 

(l)                                     the Trustee may request that the Company deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture.

 

SECTION 6.04 Not Responsible for Recitals or Issuance of Securities.  The recitals contained herein and in the Securities, except the Trustee’s certificates of authentication, shall be taken as the statements of the Company, and the Trustee or any Authenticating Agent assumes no responsibility for their correctness.  The Trustee makes no representations as to the validity or sufficiency of this Indenture or of the Securities.  The Trustee shall not be accountable for the use or application by the Company of Securities or the proceeds thereof.

 

SECTION 6.05 May Hold Securities.  The Trustee, any Authenticating Agent, any Paying Agent, any Security Registrar, any Securities Custodian or any other agent of the Company, in its individual or any other capacity, may become the owner or pledgee of Securities and, subject to Sections 6.08 and 6.13, may otherwise deal with the Company with the same rights it would have if it were not Trustee, Authenticating Agent, Paying Agent, Security Registrar, Securities Custodian or such other agent.

 

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SECTION 6.06 Money Held in Trust.  Money held by the Trustee in trust hereunder need not be segregated from other funds except to the extent required by law.  The Trustee shall be under no liability for interest on any money received by it hereunder except as otherwise agreed in writing with the Company.

 

SECTION 6.07 Compensation and Reimbursement.  The Company agrees (1) to pay to the Trustee from time to time such compensation as the Company and the Trustee shall from time to time agree in writing for all services rendered by it hereunder (which compensation shall not be limited by any provision of law in regard to the compensation of a trustee of an express trust); (2) to promptly 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 Indenture (including the reasonable compensation and the expenses and disbursements of its agents and counsel), except any such expense, disbursement or advance as may have been caused by its negligence or willful misconduct; and (3) to indemnify the Trustee, its directors, officers, agents and employees for, and to hold them harmless against, any and all loss, damage, claim, liability or expense incurred without negligence or bad faith on its part, including taxes (other than taxes based upon, measured by or determined by the revenue or income of the Trustee), arising out of or in connection with the acceptance or administration of this trust, including the costs and expenses of defending itself against any claim (whether asserted by the Company, a Holder or any other Person) or liability in connection with the exercise or performance of any of its powers or duties hereunder.

 

The Trustee shall have a lien prior to the Securities as to all property and funds held by it hereunder for any amount owing to it pursuant to this Section 6.07, except with respect to funds held in trust for the benefit of the Holders of particular Securities.

 

When the Trustee incurs expenses or renders services in connection with an Event of Default specified in Section 5.01(f), the expenses (including the reasonable charges and expenses of its counsel) and the compensation for the services are intended to constitute expenses of administration under any applicable federal or state bankruptcy, insolvency or other similar law.

 

Notwithstanding any provisions of this Indenture, the provisions of this Section shall survive the resignation or removal of the Trustee and any satisfaction and discharge of this Indenture.

 

SECTION 6.08 Conflicting Interests.  If the Trustee has or shall acquire a conflicting interest within the meaning of the Trust Indenture Act, the Trustee shall either eliminate such interest or resign, to the extent and in the manner provided by, and subject to the provisions of, the Trust Indenture Act and this Indenture.

 

SECTION 6.09 Corporate Trustee Required; Eligibility.  There shall at all times be a Trustee hereunder which shall be a Person that is eligible pursuant to the Trust Indenture Act to act as such and has, or is a wholly owned subsidiary of a bank holding company that has, a combined capital and surplus of at least $50,000,000 and a Corporate Trust Office in the United States.  If such Person publishes reports of condition at

 

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least annually, pursuant to law or to the requirements of a Federal or State supervising or examining authority, then for the purposes of this Section and to the extent permitted by the Trust Indenture Act, the combined capital and surplus of such Person shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published. If at any time the Trustee shall cease to be eligible in accordance with the provisions of this Section, it shall resign immediately in the manner and with the effect hereinafter specified in this Article.

 

SECTION 6.10 Resignation and Removal; Appointment of Successor.  No resignation or removal of the Trustee and no appointment of a successor Trustee pursuant to this Article shall become effective until the acceptance of appointment by the successor Trustee in accordance with the applicable requirements of Section 6.11.

 

(a)                                 The Trustee may resign at any time by giving written notice thereof to the Company.  If an instrument of acceptance by a successor Trustee in accordance with the applicable requirements of Section 6.11 shall not have been delivered to the Company and the resigning Trustee within 30 days after the giving of such notice of resignation, the resigning Trustee may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee.

 

(b)                                 The Trustee may be removed at any time by Act of the Holders of a majority in principal amount of the Outstanding Securities, delivered to the Trustee and to the Company.  If an instrument of acceptance by a successor Trustee in accordance with the applicable requirements of Section 6.11 shall not have been delivered to the Company and the Trustee being removed within 30 days after the giving of such notice of removal, the Trustee being removed may petition, at the expense of the Company, any court of competent jurisdiction for the appointment of a successor Trustee.

 

(c)                                  If at any time:

 

(i)                                     the Trustee shall fail to comply with Section 6.08 after written request therefor by the Company or by any Holder who has been a bona fide Holder of a Security for at least six months, or

 

(ii)                                  the Trustee shall cease to be eligible under Section 6.09 and shall fail to resign after written request therefor by the Company or by any such Holder, or

 

(iii)                               the Trustee shall become incapable of acting or shall be adjudged a bankrupt or insolvent or a receiver of the Trustee or of its property shall be appointed or any public officer shall take charge or control of the Trustee or of its property or affairs for the purpose of rehabilitation, conservation or liquidation,

 

then, in any such case, (A) the Company, by a Board Resolution, may remove the Trustee, or (B) subject to Section 5.14, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

 

(d)                                  If the Trustee shall resign, be removed or become incapable of acting, or if a vacancy shall occur in the office of Trustee for any cause, the Company, by a Board

 

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Resolution, shall promptly appoint a successor Trustee.  If, within one year after such resignation, removal or incapability, or the occurrence of such vacancy, a successor Trustee shall be appointed by Act of the Holders of a majority in principal amount of the Outstanding Securities delivered to the Company and the retiring Trustee, the successor Trustee so appointed shall, forthwith upon its acceptance of such appointment in accordance with the applicable requirements of Section 6.11, become the successor Trustee and supersede the successor Trustee appointed by the Company.  If no successor Trustee shall have been so appointed by the Company or the Holders and accepted appointment in accordance with the applicable requirements of Section 6.11, any Holder who has been a bona fide Holder of a Security for at least six months may, on behalf of himself and all others similarly situated, petition any court of competent jurisdiction for the appointment of a successor Trustee.

 

(e)                                  The Company shall give notice of each resignation and each removal of the Trustee and each appointment of a successor Trustee to all Holders in the manner provided in Section 1.06.  Each notice shall include the name of the successor Trustee and the address of its Corporate Trust Office.

 

(f)                                   The resignation or removal of the Trustee pursuant to this Section 6.10 shall not affect the obligation of the Company to indemnify the Trustee pursuant to Section 6.07(3) in connection with the exercise or performance by the Trustee prior to its resignation or removal of any of its powers or duties hereunder.

 

(g)                                  No Trustee under this Indenture shall be liable for any action or omission of any successor Trustee.

 

SECTION 6.11 Acceptance of Appointment by Successor.  Every successor Trustee appointed hereunder shall execute, acknowledge and deliver to the Company and to the retiring Trustee an instrument accepting such appointment, and thereupon the resignation or removal of the retiring Trustee shall become effective and such successor Trustee, without any further act, deed or conveyance, shall become vested with all the rights, powers, trusts and duties of the retiring Trustee; but, on request of the Company or the successor Trustee, such retiring Trustee shall, upon payment of its charges, execute and deliver an instrument transferring to such successor Trustee all the rights, powers and trusts of the retiring Trustee and shall duly assign, transfer and deliver to such successor Trustee all property and money held by such retiring Trustee hereunder.  Upon request of any such successor Trustee, the Company shall execute any and all instruments for more fully and certainly vesting in and confirming to such successor Trustee all such rights, powers and trusts.

 

No successor Trustee shall accept its appointment unless at the time of such acceptance such successor Trustee shall be qualified and eligible under this Article.

 

SECTION 6.12 Merger, Conversion, Consolidation or Succession to Business.  Any corporation into which the Trustee may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which the Trustee shall be a party, or any corporation succeeding to all or substantially all the corporate trust business of the Trustee, shall be the successor of the Trustee hereunder, provided, however, that such corporation shall be otherwise qualified and eligible under this Article, without the

 

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execution or filing of any paper or any further act on the part of any of the parties hereto.  In case any Securities shall have been authenticated, but not delivered, by the Trustee then in office, any successor by merger, conversion or consolidation to such authenticating Trustee may adopt such authentication and deliver the Securities so authenticated with the same effect as if such successor Trustee had itself authenticated such Securities.

 

SECTION 6.13 Preferential Collection of Claims Against the Company.  If and when the Trustee shall be or become a creditor of the Company (or any other obligor upon the Securities), the Trustee shall be subject to the provisions of the Trust Indenture Act regarding the collection of claims against the Company (or any such other obligor).

 

SECTION 6.14 Appointment of Authenticating Agent.  The Trustee may appoint an Authenticating Agent or Agents which shall be authorized to act on behalf of the Trustee to authenticate Securities issued upon original issue and upon exchange or registration of transfer or partial purchase or pursuant to Section 3.06, and Securities so authenticated shall be entitled to the benefits of this Indenture and shall be valid and obligatory for all purposes as if authenticated by the Trustee hereunder.  Wherever reference is made in this Indenture to the authentication and delivery of Securities by the Trustee or the Trustee’s certificate of authentication, such reference shall be deemed to include authentication and delivery on behalf of the Trustee by an Authenticating Agent and a certificate of authentication executed on behalf of the Trustee by an Authenticating Agent.  Each Authenticating Agent shall be acceptable to the Company and shall at all times be a corporation organized and doing business under the laws of the United States of America, any State thereof or the District of Columbia, authorized under such laws to act as Authenticating Agent, having a combined capital and surplus of not less than $50,000,000 and subject to supervision or examination by federal or state authority.  If such Authenticating Agent publishes reports of condition at least annually, pursuant to law or to the requirements of said supervising or examining authority, then for the purposes of this Section, the combined capital and surplus of such Authenticating Agent shall be deemed to be its combined capital and surplus as set forth in its most recent report of condition so published.  If at any time an Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, such Authenticating Agent shall resign immediately in the manner and with the effect specified in this Section.

 

Any corporation into which an Authenticating Agent may be merged or converted or with which it may be consolidated, or any corporation resulting from any merger, conversion or consolidation to which such Authenticating Agent shall be a party, or any corporation succeeding to all or substantially all of the corporate agency or corporate trust business of an Authenticating Agent, shall continue to be an Authenticating Agent, provided that such corporation shall be otherwise eligible under this Section, without the execution or filing of any paper or any further act on the part of the Trustee or the Authenticating Agent.

 

An Authenticating Agent may resign at any time by giving written notice thereof to the Trustee and to the Company.  The Trustee may at any time terminate the agency of an Authenticating Agent by giving written notice thereof to such Authenticating Agent and to the Company.  Upon receiving such a notice of resignation or upon such a termination, or in case at any time such Authenticating Agent shall cease to be eligible in accordance with the provisions of this Section, the Trustee may appoint a successor Authenticating Agent which shall be

 

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acceptable to the Company and shall give notice of such appointment in the manner provided in Section 1.06, to all Holders as their names and addresses appear in the Security Register.  Any successor Authenticating Agent upon acceptance of its appointment hereunder shall become vested with all the rights, powers and duties of its predecessor hereunder, with like effect as if originally named as an Authenticating Agent.  No successor Authenticating Agent shall be appointed unless eligible under the provisions of this Section.

 

The Company agrees to pay to each Authenticating Agent from time to time reasonable compensation for its services under this Section.

 

If an appointment is made pursuant to this Section, the Securities may have endorsed thereon, in addition to the Trustee’s certificate of authentication, an alternative certificate of authentication in the following form:

 

This is one of the Securities described in the within-mentioned Indenture.

 

	
Dated:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Wilmington   Trust, National Association, as Trustee
    
	
 
    	
 
    	
By
    
	
 
    	
 
    	
As   Authentication Agent
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
By
    
	
 
    	
 
    	
Authorized   Signatory
    

 

ARTICLE VII

 

Holders’ Lists and Reports by Trustee

 

SECTION 7.01 Company to Furnish Trustee Names and Addresses of Holders.  The Company will furnish or cause to be furnished to the Trustee a list of the names and addresses of the Holders in such form as the Trustee may reasonably request in writing, within 30 days after the receipt by the Company of any such request, as of a date not more than 15 days prior to the time such list is furnished; excluding from any such list names and addresses received by the Trustee in its capacity as Security Registrar.

 

SECTION 7.02 Preservation of Information; Communications to Holders. The Trustee shall preserve, in as current a form as is reasonably practicable, the names and addresses of Holders contained in the most recent list furnished to the Trustee as provided in Section 7.01 and the names and addresses of Holders received by the Trustee in its capacity as Security Registrar, if so acting.

 

(a)                                 The rights of Holders to communicate with other Holders with respect to their rights under this Indenture or under the Securities, and the corresponding rights and duties of the Trustee, shall be as provided by the Trust Indenture Act.

 

(b)                                 Every Holder of Securities, by receiving and holding the same, agrees with the Company and the Trustee that neither the Company nor the Trustee nor any agent of

 

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any of them shall be held accountable by reason of any disclosure of information as to the names and addresses of Holders made pursuant to the Trust Indenture Act.

 

SECTION 7.03 Reports by Trustee.  Within 60 days after March 15, 2015, if the Securities remain Outstanding, the Trustee shall transmit to Holders such reports concerning the Trustee and its actions under this Indenture to the extent required pursuant to the Trust Indenture Act at the times and in the manner provided pursuant thereto.

 

(a)                                 A copy of each such report shall, at the time of such transmission to Holders, be filed by the Trustee with each stock exchange upon which the Securities are listed (if any), with the Commission and with the Company.  The Company will promptly notify the Trustee when the Securities are listed on any stock exchange and of any delisting thereof.

 

ARTICLE VIII

 

Consolidation, Merger, Conveyance, Transfer or Lease

 

SECTION 8.01 Company May Consolidate, Etc., Only on Certain Terms. The Company shall not (1) consolidate with or merge with or into any other Person or sell, convey, lease or transfer the Company’s properties and assets substantially as an entirety to any other Person in any one transaction or series of related transactions, or (2) permit any Person to consolidate with or merge into the Company unless:

 

(a)                                 in the case of a merger or consolidation, the Company is the surviving person or if the Company is not the surviving person, the surviving person formed by such consolidation or into which the Company is merged or the person to which the Company’s properties and assets are so transferred shall be an entity organized and existing under the laws of the United States of America, any state thereof or the District of Columbia and shall execute and deliver to the Trustee a supplemental indenture expressly assuming, in the case of a transaction involving the Company, the payment when due of the principal of and interest on the Securities and the performance of the Company’s other covenants under this Indenture; and

 

(b)                                 in either case, (i) immediately after giving effect to such transaction, no Default or Event of Default shall have occurred and be continuing, and (ii) an Officers’ Certificate and legal opinion concerning the conditions precedent shall have been delivered to the Trustee.

 

In the event that the Company is not the continuing entity, then, for purposes of above, the references to the Company shall be deemed to refer to the successor entity.

 

SECTION 8.02 Successor Substituted.  Upon any consolidation or merger, or any sale, assignment, conveyance, transfer, lease or disposition of all or substantially all of the properties and assets of the Company in accordance with Section 8.01, the successor Person formed by such consolidation or into which the Company is merged  or the successor Person to which such sale, assignment, conveyance, transfer, lease or disposition is made shall succeed to, and be substituted for, and may exercise every right and power of the Company under the Securities and this Indenture, as applicable, with the same effect as if such successor had been named as the Company in the Securities and this Indenture, as the case may be, and, except in

 

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the case of a lease, the Company shall be released and discharged from its obligations thereunder, except for obligations that the predecessor Person may have under the supplemental indenture that evidences the assignment of rights and obligations under the Indenture upon such consolidation, merger, sale, assignment, conveyance, transfer, lease or disposition.

 

ARTICLE IX

 

Modifications; Amendments; Waivers; Supplemental Indentures

 

SECTION 9.01 Modifications and Amendments Without Consent of Holders.  Without the consent of any Holders, when authorized by a Board Resolution, the Company and the Trustee, at any time and from time to time, may together amend, waive or supplement this Indenture or the Securities, for any of the following purposes:

 

(a)                                 to evidence the succession of another Person as obligor pursuant to this Indenture and the assumption by any such successor of the covenants of the Company herein and in the Securities and to evidence the assumption of obligations under this Indenture;

 

(b)                                 to add to the covenants of the Company for the benefit of the Holders, or to surrender any right or power herein conferred upon the Company;

 

(c)                                  to add any additional Events of Default for the benefit of the Holders of all the Securities;

 

(d)                                 to amend or supplement any provisions of this Indenture; provided that no amendment or supplement shall adversely affect the interests of the Holders of any Securities then Outstanding in any material respect;

 

(e)                                  to permit or facilitate the issuance of the Securities in uncertificated form; provided that such action shall not adversely affect the interests of the Holders of the Securities in any material respect;

 

(f)                                   to secure the Securities or to add guarantees;

 

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

 

(h)                                 to evidence and provide for the acceptance of appointment by a successor Trustee and to or change any of the provisions of this Indenture as is necessary to provide for or facilitate the administration of the trusts under this Indenture by more than one Trustee;

 

(i)                                     to provide for rights of Holders if any reclassification or change of Company Common Shares or any consolidation, merger or sale of substantially all of the property or assets of the Company occurs;

 

(j)                                     to cure any ambiguity, to correct or supplement any provision herein which may be defective or inconsistent with any other provision herein, or to make any other provisions with respect to matters or questions arising under this Indenture which shall not be inconsistent with the provisions of this Indenture; provided that this action shall not adversely affect the interests of Holders of the Securities in any material respect;

 

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(k)                                 to supplement any of the provisions of this Indenture to the extent necessary to defease and/or discharge the Securities under this Indenture; provided that the action shall not adversely affect the interests of the Holders of the Securities in any material respect;

 

(l)                                     to modify this Indenture and the Securities to increase the Share Settlement Rate; provided that the increase is in accordance with the terms of the Securities or will not adversely affect the interests of the Holders of the Securities; or

 

(m)                             to conform the text of this Indenture or the Securities to any corresponding provision of the “Description of Notes” section of the prospectus dated March 17, 2014, as part of the Company’s Registration Statement on Form S-4 (File No. 333-194245), pursuant to which the Securities were offered;

 

provided, however, that the Company shall have delivered to the Trustee an Opinion of Counsel and Officers’ Certificate stating that such action pursuant to clauses (a) to (m) above is permitted by this Indenture.  The Trustee shall not be obligated to enter into any such amendment, waiver or supplemental indenture that adversely affects its own rights, duties or immunities under this Indenture or otherwise.

 

SECTION 9.02 Modifications and Amendments With Consent of Holders.  With the written consent of the Holders of not less than a majority in principal amount of the Outstanding Securities affected by such modification or amendment (voting together as a single class), modification or amendment of the Indenture may be made; provided, however, that no such modification or amendment may, without the written consent of the Holder of each Security affected thereby:

 

(a)                                 change the Stated Maturity Date for any principal or interest payment on the Securities;

 

(b)                                 reduce the principal amount or the interest rate payable upon the redemption of the Securities;

 

(c)                                  change the timing for, or reduce any amount (including accrued interest) payable upon, the redemption of the Securities;

 

(d)                                 change the currency of any payment on the Securities;

 

(e)                                  change the place of payment on the Securities;

 

(f)                                   impair a Holder’s right to sue for the enforcement of any payment on or with respect to Securities as required by this Indenture;

 

(g)                                  reduce the percentage of principal amount of outstanding Securities necessary to modify or amend this Indenture or waive compliance with certain provisions or certain defaults and consequences under the Indenture; or

 

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(h)                                 modify any of the foregoing provisions or any of the provisions relating to the waiver of certain past defaults or certain covenants, except to increase the required percentage to effect the action or to provide that certain other provisions may not be modified or waived without the consent of the Holders of the Securities.

 

provided, however, that the Company shall have delivered to the Trustee an Opinion of Counsel and Officers’ Certificate stating that such action pursuant to clauses (a) to (m) above is permitted by this Indenture.  The Trustee shall not be obligated to enter into any such amendment, waiver or supplemental indenture that adversely affects its own rights, duties or immunities under this Indenture or otherwise.

 

SECTION 9.03 Execution of Supplemental Indentures.  In executing, or accepting the additional trusts created by, any supplemental indenture permitted by this Article or the modifications thereby of the trusts created by this Indenture, the Trustee shall be given, and (subject to Section 6.01) shall be fully protected in relying upon, an Opinion of Counsel and an Officers’ Certificate stating that the execution of such supplemental indenture is authorized or permitted by this Indenture and that all conditions precedent thereto are satisfied.  The Trustee may, but shall not be obligated to, enter into any such supplemental indenture which affects the Trustee’s own rights, duties or immunities under this Indenture or otherwise; provided that the Trustee shall enter into and execute all other supplemental indentures which satisfy all applicable conditions under this Article IX.

 

SECTION 9.04 Effect of Supplemental Indentures.  Upon the execution of any supplemental indenture under this Article, this Indenture shall be modified in accordance therewith, and such supplemental indenture shall form a part of this Indenture for all purposes; and every Holder of Securities theretofore or thereafter authenticated and delivered hereunder shall be bound thereby.

 

SECTION 9.05 Conformity with Trust Indenture Act.  Every supplemental indenture executed pursuant to this Article shall conform to the requirements of the Trust Indenture Act as then in effect.

 

SECTION 9.06 Reference in Securities to Supplemental Indentures.  Securities authenticated and delivered after the execution of any supplemental indenture pursuant to this Article may, and shall if required by the Trustee, bear a notation in form approved by the Trustee as to any matter provided for in such supplemental indenture, provided that any failure by the Trustee to make such notation shall not affect the validity of the matter provided for in such supplemental indenture or any Security hereunder. If the Company shall so determine, new Securities so modified as to conform, in the opinion of the Trustee and the Company, to any such supplemental indenture may be prepared and executed by the Company and authenticated and delivered by the Trustee in exchange for Outstanding Securities.

 

SECTION 9.07 Reserved.

 

SECTION 9.08 No Liability for Certain Persons.  No director, officer, employee, or stockholder of the Company, as such, shall have any liability for any obligations of the

 

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Company under the Securities or this Indenture based on or by reason of such obligations or their creation.  Each Holder by accepting a Security waives and releases all such liability.  The foregoing waiver and release are an integral part of the consideration for the issuance of the Securities.

 

ARTICLE X

 

Covenants

 

SECTION 10.01 Payment of Principal and Interest.  The Company shall duly and punctually pay the principal of and interest on the Securities in accordance with the terms of the Securities and this Indenture.  The Company will deposit or cause to be deposited with the Trustee or its nominee, no later than the opening of business on the Stated Maturity Date of all payments so due, which payments shall be in immediately available funds on the Stated Maturity Date.

 

SECTION 10.02 Maintenance of Office or Agency.  The Company shall maintain an office or agency where Securities may be presented or surrendered for payment, where Securities may be surrendered for registration of transfer or exchange. The Company shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency.  If at any time the Company shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations and surrenders may be made at a Corporate Trust Office of the Trustee, and the Company hereby appoints the Trustee as its agent to receive all such presentations, surrenders, notices and demands.  In the event any such notice or demands are so made or served on the Trustee, the Trustee shall promptly forward copies thereof to the Company.

 

The Company may also from time to time designate one or more other offices or agencies (in or outside the Borough of Manhattan, The City of New York) where the Securities may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Company of its obligation to maintain an office or agency in the Borough of Manhattan, The City of New York, for such purposes.  The Company shall give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

 

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

 

SECTION 10.03 Money for Security Payments to be Held in Trust.  If the Company shall at any time act as its own Paying Agent, it will, on or before each due date of the principal of or interest on any of the Securities, segregate and hold in trust for the benefit of the Persons entitled thereto a sum sufficient to pay the principal or interest so becoming due until

 

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such sums shall be paid to such Persons or otherwise disposed of as herein provided and will promptly notify the Trustee of its action or failure so to act.

 

Whenever the Company shall have one or more Paying Agents, the Company will, prior to 11:00 a.m., New York City time, on each due date of the principal of or interest on any Securities, deposit with a Paying Agent a sum sufficient to pay the principal or interest so becoming due, such sum to be held as provided by the Trust Indenture Act, and (unless such Paying Agent is the Trustee) the Company will promptly notify the Trustee of its action or failure so to act.

 

The Company shall cause each Paying Agent other than the Trustee to execute and deliver to the Trustee an instrument in which such Paying Agent shall agree with the Trustee, subject to the provisions of this Section, that such Paying Agent will:  (i) comply with the provisions of the Trust Indenture Act applicable to it as Paying Agent and (ii) during the continuance of any default by the Company (or any other obligor upon the Securities) in the making of any payment in respect of the Securities, upon the written request of the Trustee, forthwith pay to the Trustee all sums held in trust by such Paying Agent as such.

 

The Company may at any time, for the purpose of obtaining the satisfaction and discharge of this Indenture or for any other purpose, pay, or by Company Order direct any Paying Agent to pay, to the Trustee all sums held in trust by such Paying Agent, such sums to be held by the Trustee upon the same trusts as those upon which such sums were held by such Paying Agent; and, upon such payment by any Paying Agent (other than the Company) to the Trustee, such Paying Agent shall be released from all further liability with respect to such money.

 

Any money deposited with the Trustee or any Paying Agent, or then held by the Company, in trust for the payment of the principal of or interest on any Security and remaining unclaimed for two years after such principal or interest has become due and payable shall be paid to the Company on Company Request, or (if then held by the Company) shall be discharged from such trust; and the Holder of such Security shall thereafter, as an unsecured general creditor, look only to the Company for payment thereof, and all liability of the Trustee or such Paying Agent with respect to such trust money, and all liability of the Company as trustee thereof, shall thereupon cease; provided, however, that the Trustee or such Paying Agent, before being required to make any such repayment, may at the expense of the Company cause to be published once, in a newspaper published in the English language, customarily published on each Business Day and of general circulation in The City of New York, notice that such money remains unclaimed and that, after a date specified therein, which shall not be less than 30 days from the date of such publication, any unclaimed balance of such money then remaining will be repaid to the Company.

 

SECTION 10.04 Statement by Officers as to Default; Compliance Certificates.  The Company shall deliver to the Trustee, prior to March 31 in each year commencing with the year beginning on January 1, 2015 (if the Securities remain Outstanding), an Officers’ Certificate, stating whether or not to the best knowledge of the signers thereof the Company is in default in the performance and observance of any of the terms, provisions and conditions of this Indenture (without regard to any period of grace or requirement of notice provided hereunder),

 

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and if the Company shall be in default, specifying all such defaults and the nature and status thereof of which he may have knowledge.

 

(a)           The Company shall deliver to the Trustee, as soon as possible and in any event within five days after the Company becomes aware of the occurrence of a Default or an Event of Default, an Officers’ Certificate setting forth the details of such Default or Event of Default, and the action which the Company proposes to take with respect thereto.

 

SECTION 10.05  Provision of Financial Information. The Company shall provide the Trustee, within 15 days after the Company is required to file the same with the Commission, copies of the annual reports and information, documents and other reports (or copies of such portions any of the foregoing as the Commission may prescribe) which the Company is required to file with the Commission pursuant to Section 13 or Section 15(d) of the Exchange Act. If the Company is not required to file information, documents or reports pursuant to either of those sections, then the Company shall provide to the Trustee and to the Commission such reports as may be prescribed to be filed by the Company by the Commission at such time. To the extent that the Company has filed such information with the Commission through the Commission’s EDGAR system, or any successor system employed by the Commission, the Company shall be deemed to have complied with the requirement of this Section 10.05.

 

Delivery of such reports, information and documents to the Trustee is for informational purposes only and the Trustee’s receipt of such shall not constitute actual or constructive notice of any information contained therein or determinable from information contained therein, including the Company’s compliance with any of its covenants hereunder (as to which the Trustee is entitled to rely exclusively on Officers’ Certificates).

 

ARTICLE XI

 

Redemption of Securities and Purchases Thereupon

 

SECTION 11.01 Right of Redemption.  The Securities are redeemable at the election of the Company prior to the Stated Maturity Date.

 

(a)           The Company shall have the right, at any time or from time to time, prior to the Stated Maturity Date, upon not less than 10 nor more than 60 days’ prior written notice delivered to the Holders (with a copy to the Trustee), to redeem any or all of the Securities for cash at a redemption price equal to the sum of (x) 100% of the principal amount of the Securities to be redeemed; plus (y) the present value of the scheduled interest payment on the Securities that would be due on the Stated Maturity Date, discounted to the date of redemption (assuming a 360-day year consisting of twelve 30-day months) at a rate of 1% per annum.

 

(b)           In the event that the Company shall redeem fewer than all Securities then Outstanding, the Trustee will select the Securities redeemed on a pro rata basis, by lot, or by such other method the Trustee considers fair and appropriate or is required by the Depositary for the Securities.  The Trustee shall make the selection at least 15 days before the redemption date from Outstanding Securities not previously called for redemption.  Securities and portions 

 

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of the principal amount thereof selected for redemption shall be in integral multiples of $1,000.  The Trustee shall notify the Company promptly of the Securities or portions of the principal amount thereof to be redeemed.

 

(c)           In the event of any redemption in part, the Company shall not be required to:  (i) issue or register the transfer or exchange of any Security during a period beginning at the opening of business five days before any selection of Securities for redemption and ending at the Close of Business on the earliest date on which the relevant notice of redemption is deemed to have been given to all Holders of Securities to be so redeemed, or (ii) register the transfer or exchange of any Security so selected for redemption, in whole or in part, except the unredeemed portion of any Security being redeemed in part.

 

(d)           A notice of redemption sent to the Holders of Securities to be redeemed in accordance with the provisions of this Section 11.01 shall state:

 

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

 

(ii)           If the Paying Agent holds funds sufficient to pay the redemption price of the Securities on the redemption date, then on and after such date:

 

(A)                               such Securities will cease to be Outstanding;

 

(B)                               interest on such Securities will cease to accrue; and

 

(C)                               all rights of Holders of such Securities will terminate except the right to receive the redemption price.

 

(e)           Any Security which is to be redeemed only in part shall be surrendered at an office or agency of the Company designated for that purpose (with, if the Company or the Trustee so requires, due endorsement by, or a written instrument of transfer in form satisfactory to the Trustee duly executed by, the Holder thereof or its attorney duly authorized in writing), and the Company shall execute, and the Trustee shall authenticate and make available for delivery to the Holder of such Security without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder, in aggregate principal amount equal to and in exchange for the unredeemed portion of the principal of the Security so surrendered.  Upon redemption, interests in Global Securities shall be reduced in accordance with the applicable procedures of the Depositary (the “Applicable Procedures”).

 

SECTION 11.02 Securities Purchased in Whole or in Part.  Any Security that is to be purchased, whether in whole or in part, shall be surrendered at the office of the Paying Agent (with, if the Company or the Trustee so requires in the case of Definitive Securities, due endorsement by, or a written instrument of transfer in form satisfactory to the Company and the Trustee duly executed by, the Holder thereof or such Holder’s attorney duly authorized in writing) and the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities, of any authorized denomination as requested by such Holder in aggregate principal amount equal to, and in 

 

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exchange for, the portion of the principal amount of the Security so surrendered that is not purchased.

 

SECTION 11.03 Covenant to Comply With Applicable Laws Upon Purchase of Securities.  In connection with any offer to purchase Securities under Section 11.02 hereof, the Company shall, in each case if required, (i) comply with Rule 13e-4, Rule 14e-1 and any other tender offer rules under the Exchange Act that may then be applicable, (ii) file a Schedule TO or any other required schedule under the Exchange Act and (iii) otherwise comply with all federal and state securities laws so as to permit the rights and obligations under Section 11.02 to be exercised in the time and in the manner specified in Section 11.02.

 

SECTION 11.04 Sinking Fund.  No sinking fund is provided for the Securities.

 

ARTICLE XII

 

Share Settlement

 

SECTION 12.01 Right to Settle in Shares.  Subject to and upon compliance with the provisions of this Indenture, the Company, at its election, may satisfy its obligation to repay the principal amount of the Securities at the Stated Maturity Date, in whole and not in part, by delivering Company Common Shares in lieu of cash (such shares, the “Share Settlement”). Notwithstanding the foregoing sentence, if any calculation required in order to determine the number of Company Common Shares that must be delivered in respect of the Securities is based on data that will not be available to the Company on the Stated Maturity Date, the Company will delay delivery of Company Common Shares until the first business day after such data becomes available; provided that, if the Company cannot complete such delivery within ten Business Days following the Stated Maturity Date, each Holder will have the right, at its option, to require the Company to deliver the principal amount of such Securities in cash, rather than Company Common Shares, in an amount equal to 100% of the principal amount of Securities held by such Holder. If the Company fails to deliver the Share Settlement Amount within seven business days after the Stated Maturity Date, the Company will provide the Trustee a notice with an election form attached thereto to be delivered by Holders who elect to receive cash in such circumstances, which the Trustee shall transmit to Holders in accordance with the notice provisions of this Indenture no later than the tenth business day after the Stated Maturity Date.  Any Holder making such an election shall, in addition to complying with the Applicable Procedures, deliver such completed election form to the Company and the Trustee.  Promptly after such completed election form is received, the Company shall make a cash payment to such electing Holder to the account specified in such completed election form, and direct the Trustee to cancel the related notes held by such Holder.   For the avoidance of doubt, the Company is not permitted to pay interest by delivering Company Common Shares in lieu of cash.  Subject to Section 3.07, interest shall cease to accrue on the Securities following the Stated Maturity Date, unless the Company defaults in making payment of the principal amount of the Securities either in cash or via Share Settlement, as the case may be.

 

SECTION 12.02 Share Settlement Procedures.

 

(a)           Company Common Shares may be delivered in lieu of cash in accordance with the provisions of this Article XII and, if applicable, in accordance with the procedures of the Depositary.

 

In order to deliver Company Common Shares with respect to any interest in a Global Security, the Company shall (i) deliver written notice of its election to (1) the Trustee not less than 30 scheduled trading days prior to the Stated Maturity Date and (2) the Depositary not less than 25 scheduled trading days prior to the Stated Maturity Date (in each case, the “Share Settlement Election Notice”), (ii) comply with the Applicable Procedures, and (iii) pay any taxes or duties if required pursuant to Section 12.06. In order to deliver Company Common Shares in lieu of cash at the Stated Maturity Date with respect to any Definitive Securities, the Company shall (i) deliver a Share Settlement Election Notice to (1) the Trustee not less than 30 scheduled trading days prior to the Stated Maturity Date and (2) Holders of Definitive Securities not less than 25 scheduled trading days prior to the Stated Maturity Date, 

 

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(ii) if required, furnish appropriate endorsements and transfer documents, and (iii) if required, pay all transfer or similar taxes as set forth in Section 12.06.

 

The date on which the Company satisfies all of the applicable requirements set forth above is the Share Settlement Election Date (the “Share Settlement Election Date”).  The Trustee shall, as promptly as practicable, in any event no later than five Business Days of the receipt thereof, provide Holders of the Securities with the Company’s Share Settlement Election Notice. As promptly as practicable, such Holders shall provide to the Trustee in writing the name or names (with corresponding address or addresses) in which any certificate or certificates for Company Common Shares shall be issued. All corresponding Securities shall, unless the Company Common Shares issuable on the Stated Maturity Date are to be issued in the same name as the registration of such Securities, be duly endorsed by, or be accompanied by instruments of transfer in form satisfactory to the Company duly elected by, the Holder or his duly authorized attorney.

 

SECTION 12.03 Determination of Share Settlement Amount.  If the Company makes a Share Settlement election, for each of the 20 consecutive trading days during the Share Settlement Measurement Period (as defined below), the Company will deliver a number of Company Common Shares equal to the Applicable Share Settlement Rate (as defined below) divided by 20.

 

(a)           The “Applicable Share Settlement Rate” or the “Share Settlement Rate”, as of any trading day (as defined below), means the amount determined by dividing $1,000 principal amount of the Securities by the Daily VWAP (as defined below) of the Company Common Shares on such trading day.  With respect to each day in the Share Settlement Measurement Period (as defined below), if an event happens that would give rise to an adjustment provided for pursuant to Section 12.04, then the Applicable Share Settlement Rate for each trading day during the Share Settlement Measurement Period that is prior to the trading day on which such adjustment is made shall be retroactively adjusted to give effect to such adjustment with respect to each such prior trading day.

 

(b)           The “Share Settlement Measurement Period” means the 20 consecutive trading-day period beginning on the 23rd scheduled trading day prior to the Stated Maturity Date.

 

(c)           A “trading day” means a day during which: (i) trading in securities generally occurs on the New York Stock Exchange or, if the subject securities are not then listed on the New York Stock Exchange, on the principal national securities exchange on which such securities are then listed and (ii) there is no Market Disruption Event.

 

(d)           “Daily VWAP” for the Company Common Shares means, for each trading day, the per share volume-weighted average price as displayed under the heading “Bloomberg VWAP” on Bloomberg (or any successor service) page NRF UN <equity>AQR (or its equivalent successor if such page is not available or the equivalent page, as determined by the Company, for each other security for which Daily VWAP must be determined) in respect of the period from the scheduled open of trading until the scheduled close of trading of the primary trading session on such trading day (or if such volume-weighted average price is unavailable, 

 

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the market value of one Company Common Share on such trading day as determined by the Company’s Board in good faith using a volume-weighted method or by a nationally recognized independent investment banking firm retained by the Company for this purpose).

 

(e)           If the Company makes a Share Settlement election, the Company will not deliver fractional Company Common Shares.  The  number  of  full  shares  of  Company  Common  Shares  that  shall  be  issuable  pursuant  to  Share Settlement  shall  be  computed  on  the  basis  of  the  aggregate  principal  amount  of  the  Securities outstanding  on  the  Scheduled  Maturity  Date.  In  determining  whether  any  fractional  Company Common  Shares  are  required  to  be  issued,  the  beneficial  ownership  of  Securities  by  Agent Members  (or,  if  such  information  is  made  available  by  the  Agent  Members  in  their  discretion, the  beneficial  owners  of  the  Securities  beneficially  owned  by  such  Agent  Members)  shall  be taken  into  account  to  the  extent  commercially  reasonable  and  then  permitted  by,  or  possible under,  the  Applicable  Procedures.  If  any  fractional  Company  Common  Shares  would  be  issuable upon  settlement  of  the  Securities,  the  Company  shall  made  an  adjustment  and  payment  therefor and  deliver  to  the  Holder  (or  such  Agent  Members,  as  applicable) cash in lieu of any fractional Company Common Shares issuable in connection with payment of the shares based upon the Closing Sale Price (as defined below) of the Company Common Shares on the last day of the applicable Share Settlement Measurement Period.

 

(f)            “Closing Sale Price” of the Company Common Shares or other Capital Stock or similar equity interests or other publicly traded securities on any date means the Closing Sale Price per share (or, if no Closing Sale Price is reported, the average of the closing bid and ask prices or, if more than one in either case, the average of the average closing bid and the average closing ask prices) on such date as reported on the principal U.S. securities exchange on which such securities are listed or, if such securities are not listed on a United States securities exchange by OTC Markets Group Inc. or another established over-the-counter trading market in the United States.  The Closing Sale Price will be determined without regard to after-hours trading or extended market making.  In the absence of the foregoing, the Company will determine the Closing Sale Price on such basis as it considers appropriate.

 

SECTION 12.04 Adjustment of Share Settlement Rate.  If the Company makes a Share Settlement election, then with respect to any trading day that falls between the first day of the Share Settlement Measurement Period and the settlement date on which the Company delivers Company Common Shares to Holders, if any event that would give rise to a Share Settlement Rate adjustment pursuant to the following provisions occurs, then for each prior trading day in the Share Settlement Measurement Period (or, if such adjustment occurs after the end of the Share Settlement Measurement Period, for each day in such period), the Share Settlement Rate for such prior trading day(s) shall be adjusted by the Company as follows:

 

(a)           If the Company issues Company Common Shares as a dividend or other distribution on Company Common Shares to all holders of Company Common Shares, or if the Company effects a share split or share combination of Company Common Shares, the Share Settlement Rate will be adjusted based on the following formula:

 

ER1  =    ER0 x OS1/OS0

 

where

 

ER0 =              the Share Settlement Rate in effect immediately prior to the Ex-Dividend Date for such dividend or other distribution or the effective date of such share split or share combination, as applicable;

 

ER1  =             the Share Settlement Rate in effect on and immediately after the Ex-Dividend Date for such dividend or other distribution or the effective date of such share split or share combination, as applicable;

 

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OS0 =                 the number of Company Common Shares outstanding on the Ex-Dividend Date for such dividend or other distribution or the effective date of such share split or share combination, as applicable; and

 

OS1 =                 the number of Company Common Shares outstanding on the Ex-Dividend Date for such dividend or other distribution or the effective date of such share split or share combination, as applicable, as if such dividend, distribution, split or combination occurred at that time.

 

If any dividend or other distribution described in this paragraph (a) is declared but not so paid or made, the Share Settlement Rate shall be readjusted to the Share Settlement Rate that would then be in effect if such dividend or other distribution had not been declared.

 

(b)           If the Company issues to all holders of Company Common Shares any rights, warrants, options or other securities entitling them for a period of not more than 45 days after the date of issuance thereof to subscribe for or purchase Company Common Shares or securities convertible into Company Common Shares within 45 days after the issuance thereof, in either case at an exercise price per share or a conversion price per share less than the Closing Sale Price of Company Common Shares on the business day immediately preceding the time of announcement of such issuance, the Share Settlement Rate will be adjusted based on the following formula (provided that the Share Settlement Rate will be readjusted to the extent that such rights, warrants, options, or other securities or convertible securities are not exercised or converted prior to the expiration of the exercisability or convertibility thereof):

 

ER1 =      ER0 x (OS0+X)/(OS0+Y)

 

where

 

ER0 =                the Share Settlement Rate in effect immediately prior to the Ex-Dividend Date for such issuance;

 

ER1=                   the Share Settlement Rate in effect on and immediately after the Ex-Dividend Date for such issuance;

 

OS0 =                 the number of Company Common Shares outstanding immediately prior to the Ex-Dividend Date for such issuance;

 

X =                             the number of Company Common Shares issuable pursuant to such rights, warrants, options, other securities or convertible securities; and

 

Y =                             the number of Company Common Shares equal to the quotient of (A) the aggregate price payable to exercise such rights, warrants, options, other securities or convertible securities and (B) the average of the Closing Sale Prices of the Company Common Shares for the 10 consecutive trading days prior to the business day immediately preceding the date of announcement for the issuance of such rights, warrants, options, other securities or convertible securities.

 

52

 

For purposes of this paragraph (b), in determining whether any rights, warrants, options, other securities or convertible securities entitle the holders to subscribe for or purchase or exercise a conversion right for Company Common Shares at less than the average Closing Sale Price of Company Common Shares, and in determining the aggregate exercise or conversion price payable for such Company Common Shares, there shall be taken into account any consideration received by the Company for such rights, warrants, options, other securities or convertible securities and any amount payable on exercise or conversion thereof, with the value of such consideration, if other than cash, to be determined by the Company’s Board of Directors.

 

If any right, warrant, option, other security or convertible security described in this paragraph (b) is not exercised or converted prior to the expiration of the exercisability or convertibility thereof, the new Share Settlement Rate shall be readjusted to the Share Settlement Rate that would then be in effect if such right, warrant, option, other security or convertible security had not been so issued.

 

(c)           If the Company distributes shares of Capital Stock, evidences of indebtedness or other assets or property of the Company to all holders of Company Common Shares, excluding:

 

(i)            dividends or other distributions, rights, warrants, options, other securities or convertible securities referred to in paragraphs (a) or (b) above;

 

(ii)           dividends or other distributions paid exclusively in cash; and

 

(iii)          spin-offs described below in this paragraph (c);

 

then the Share Settlement Rate will be adjusted based on the following formula:

 

ER1  =    ER0 x SP0/(SP0-FMV)

 

where

 

ER0 =                the Share Settlement Rate in effect immediately prior to the Ex-Dividend Date for such distribution;

 

ER1 =                the Share Settlement Rate in effect on and immediately after the Ex-Dividend Date for such distribution;

 

SP0 =                   the average of the Closing Sale Prices of the Company Common Shares for the ten consecutive trading days prior to the business day immediately preceding the Ex-Dividend Date for such distribution; and

 

FMV=             the fair market value (as determined in good faith by the Company’s Board of Directors) of the shares of Capital Stock, evidences of indebtedness, assets or property distributed with respect to each outstanding Company Common Share on the Ex-Dividend Date for such distribution.

 

53

 

With respect to an adjustment pursuant to this paragraph (c) where there has been a payment of a dividend or other distribution on Company Common Shares or shares of Capital Stock of any class or series, or similar equity interest, of or relating to a subsidiary or other business unit of the Company (such transaction, a “Spin-Off”), the Share Settlement Rate will be adjusted based on the following formula:

 

ER1 =     ER0 x (FMV0+MP0)/MP0 where

 

ER0 =                the Share Settlement Rate in effect immediately prior to the effective date of the Spin-Off;

 

ER1 =                the Share Settlement Rate in effect on and immediately after the effective date of the Spin-Off;

 

FMV0 =     the average of the Closing Sale Prices of the Capital Stock or similar equity interest distributed to holders of Company Common Shares applicable to one share of Company Common Share over the first 10 consecutive trading days after the effective date of the Spin-Off; and

 

MP0 =              the average of the Closing Sale Prices of Company Common Shares over the first 10 consecutive trading days after the effective date of the Spin-Off.

 

If any such dividend or other distribution described in paragraph (c) is declared but not paid or made, the Share Settlement Rate shall be readjusted to be the Share Settlement Rate that would then be in effect if such dividend or other distribution had not been declared.

 

(d)           If the Company makes any cash dividend or other distribution to all holders of Company Common Shares, the Share Settlement Rate will be adjusted based on the following formula:

 

ER1  =    ER0 x (SP0)/(SP0-C)

 

where

 

ER0 =                the Share Settlement Rate in effect immediately prior to the Ex-Dividend Date for such distribution;

 

ER1  =             the Share Settlement Rate in effect on and immediately after the Ex-Dividend Date for such distribution;

 

SP0 =                   the average of the Closing Sale Prices of the Company Common Shares over the period of the five consecutive trading days ending on the business day immediately preceding the Ex-Dividend Date for such distribution; and

 

C =                             the amount in cash per share that the Company distributes to holders of the Company Common Shares.

 

54

 

If any dividend or other distribution described in this paragraph (d) is declared but not so paid or made, the Share Settlement Rate shall be readjusted to the Share Settlement Rate that would then be in effect if such dividend or distribution had not been declared.

 

(e)                                  If the Company or any of its subsidiaries makes a payment in respect of a tender offer or exchange offer for Company Common Shares to the extent that the cash and value of any other consideration included in the payment per share exceeds the Closing Sale Price of a Company Common Share on the trading day next succeeding the last date on which tenders or exchanges may be made pursuant to such tender offer or exchange offer (the “Expiration Time”), the Share Settlement Rate will be adjusted based on the following formula:

 

ER1 = ER0 x (AC + (SP1 x OS1))/(SP1 x OS0)

 

where

 

ER0 = the Share Settlement Rate in effect on the date such tender offer or exchange offer expires;

 

ER1 = the Share Settlement Rate in effect on the day next succeeding the date such tender offer or exchange offer expires;

 

AC = the aggregate value of all cash and any other consideration (as determined by the Company’s Board of Directors) paid or payable for shares purchased in such tender offer or exchange offer;

 

OS0 = the number of Company Common Shares outstanding immediately prior to the date such tender offer or exchange offer expires;

 

OS1 = the number of Company Common Shares outstanding immediately after such tender offer or exchange offer expires (after giving effect to the purchase or exchange of Company Common Shares pursuant to such tender offer or exchange offer); and

 

SP1 = the average of the Closing Sale Prices of the Company Common Shares for the five consecutive trading days commencing on the trading day next succeeding the date such tender offer or exchange offer expires.

 

If the application of the foregoing formula would result in a decrease in the Share Settlement Rate, no adjustment to the Share Settlement Rate will be made.

 

If the Company or one of its subsidiaries is obligated to purchase Company Common Shares pursuant to any such tender offer or exchange offer, but it or such subsidiary is permanently prevented by applicable law from effecting any such purchases or all such purchases are rescinded, the Share Settlement Rate shall be readjusted to be the Share Settlement Rate that would be in effect if such tender or exchange offer had not been made.

 

55

 

(f)                                   If the Company adopts a stockholder rights plan while any Securities remain Outstanding, Holders of Securities will receive, upon delivery of Company Common Shares upon settlement of the Securities, in addition to Company Common Shares, rights under such stockholder rights plan unless, prior to settlement, the rights have expired, terminated or been redeemed or unless the rights have separated from the Company Common Shares.  If the rights provided for in the rights plan adopted by the Company have separated from the Company Common Shares in accordance with the provisions of the applicable stockholder rights agreement so that Holders of Securities would not be entitled to receive any rights in respect of Company Common Shares issuable upon settlement of the Securities, the Share Settlement Rate will be adjusted at the time of separation as if the Company had distributed, to all holders of Company Common Shares, shares of Capital Stock, evidences of indebtedness or other assets or property pursuant to paragraph (c) above, subject to readjustment upon the subsequent expiration, termination or redemption of the rights.  In lieu of any such adjustment, the Company may amend such applicable stockholder rights agreement to provide that upon settlement of the Securities for Company Common Shares, the holders will receive, in addition to the Company Common Shares issuable upon such settlement, the rights which would have attached to such Company Common Shares if the rights had not become separated from the Company Common Shares under such shareholder rights plan.

 

(g)                                  In addition to the adjustments pursuant to paragraphs (a) through (f) above, the Company may increase the Share Settlement Rate in order to avoid or diminish any income tax to holders of the Company Capital Stock resulting from any dividend or other distribution of Capital Stock (or rights to acquire Company Common Shares) or from any event treated as such for income tax purposes.  The Company may also, from time-to-time, to the extent permitted by applicable law, increase the Share Settlement Rate by any amount for any period if the Company has determined that such increase would be in its best interests.  If the Company makes such determination, it will be conclusive and the Company will mail to Holders a notice of the increase at least five days prior to the date the increased Share Settlement Rate takes effect in accordance with applicable law and such notice shall state the increased Share Settlement Rate and the period during which it will be in effect.

 

(h)                                 All calculations under this Article XII shall be made by the Company and shall be made to the nearest one ten-thousandth of a share (including, in the case of any adjustment to the Share Settlement Rate, the resulting adjustment to the Share Settlement).

 

(i)                                     Notwithstanding anything to the contrary in this Article XII, no adjustment to the Share Settlement Rate shall be made:

 

(i)                                     if Holders are permitted to participate in the dividend, distribution or transaction, as applicable, on an as settled basis, in the transactions set forth above in this Section 12.04;

 

(ii)                                  the issuance of any Company Common Shares pursuant to any present or future plan providing for the reinvestment of dividends or interest payable on the securities of the Company or any of its subsidiaries and the investment of additional optional amounts in Company Common Shares under any plan;

 

56

 

(iii)                               the issuance of any Company Common Shares or units of the Operating Partnership or options or rights to purchase those shares or units pursuant to any present or future employee, directors trustee or consultant benefit plan, employee agreement or arrangement or program of the Company or any of its subsidiaries;

 

(iv)                              the issuance of any Company Common Shares or units of the Operating Partnership pursuant to any option, warrant, right, or exercisable, exchangeable or convertible security outstanding as of the date the Securities were first issued;

 

(v)                                 a change in the par value of the Company Common Shares;

 

(vi)                              accumulated and unpaid dividends or other distributions;

 

(vii)                           as a result of a tender offer solely to holders of less than 100 Company Common Shares; and

 

(viii)                        for the avoidance of doubt, except as specifically described above, the issuance of Company Common Shares, limited partnership units by the Operating Partnership or equity interests in any subsidiary or by the Company or the Operating Partnership or, in any case, the payment of cash upon redemption thereof.

 

Except as specifically described above, the Share Settlement Rate shall not be subject to adjustment in the case of the issuance of any Company Common Shares or shares of preferred stock of the Company or securities exchangeable for or convertible into Company Common Shares or shares of preferred stock of the Company.

 

SECTION 12.05 Certain Other Adjustments. Whenever a provision of this Indenture requires the calculation of Closing Sale Prices, Daily VWAPs, Share Settlement Rates or other amounts over a span of multiple days, the Board of Directors will make appropriate adjustments consistent with the provisions described in Section 12.04 to account for any adjustment to the Share Settlement Rate that becomes effective, or any event requiring an adjustment to the Share Settlement Rate where the Record Date or Ex-Dividend Date of the event occurs, at any time during the period from which such Closing Sale Prices, Daily VWAPs, Share Settlement Rates or other amounts are to be calculated.

 

For purposes hereof, the number of Company Common Shares at any time outstanding shall include shares issuable in respect of scrip certificates issued in lieu of fractions of shares.

 

For purposes hereof, “Record Date” shall mean, with respect to any dividend, distribution or other transaction or event in which the holders of Company Common Shares have the right to receive any cash, securities or other property or into which the Company Common Shares (or other applicable security) is exchanged or converted into any combination of cash, securities or other property, the date fixed for determination or stockholders entitled to receive such cash, security or other property.

 

SECTION 12.06 Taxes on Shares Issued. The Company will pay any documentary, stamp or similar issue or transfer tax due on the issue or delivery of Company

 

57

 

Common Shares pursuant hereto; provided, however, that if such documentary, stamp or similar issue or transfer tax is due because the Holder of such Securities has requested that Company Common Shares be issued in a name other than that of the Holder of the Securities converted, then such taxes will be paid by the Holder, and the Company shall not be required to issue or deliver any stock certificate evidencing such shares unless and until the Holder shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.

 

SECTION 12.07 Responsibility of Trustee. The Trustee shall not at any time be under any duty or responsibility to any Holder of Securities to determine or calculate the Share Settlement Rate, to determine whether any facts exist which may require any adjustment of the Share Settlement Rate, or to confirm the accuracy of any such adjustment when made or the appropriateness of the method employed, or herein or in any supplemental indenture provided to be employed, in making the same. The Trustee shall not be accountable with respect to the validity or value (or the kind or amount) of any Company Common Shares delivered in lieu of cash at the Stated Maturity Date; and the Trustee makes no representations with respect thereto. The Trustee shall not be responsible for any failure of the Company to issue, transfer or deliver any Company Common Shares or to comply with any of the duties, responsibilities or covenants of the Company contained in this Article XII. The rights, privileges, protections, immunities and benefits given to the Trustee, including without limitation its right to be compensated, reimbursed, and indemnified, are extended to, and shall be enforceable by, the Trustee in each of its capacities hereunder.

 

SECTION 12.08 Ownership Limit. Notwithstanding any other provision of the Securities, the Company shall not deliver Company Common Shares to a Holder of Securities if receipt of such shares would cause such Holder (together with such Holder’s Affiliates) to exceed the ownership limit contained in the Company’s charter, unless such Person has been exempted from such limits in the Company’s Board’s sole discretion in accordance with its charter. In any such instance, and notwithstanding any election the Company has made to deliver Company Common Shares at the Stated Maturity Date in lieu of cash, the Company shall deliver to such Holder (i) the maximum number of shares that it may deliver to such Holder in compliance with such ownership limit, and (ii) an amount of cash equal to (1) the principal amount of Securities held by such Holder, minus (2) the number of Company Common Shares to be delivered to such Holder multiplied by the Closing Sale Price of the Company Common Shares on the business day prior to the day on which the shares are delivered to such Holder.

 

ARTICLE XIII

 

Repurchase

 

SECTION 13.01 Repurchase at Option of Holders upon a Change in Control.

 

(a)                                 If a Change in Control occurs at any time prior to the Stated Maturity Date, a Holder of Securities shall have the right, at its option, to require the Company to repurchase all of such Holder’s Securities not previously called for redemption, in whole or in part (in principal amounts of $1,000 or an integral multiple thereof) for cash equal to the

 

58

 

Change in Control Purchase Price (such repurchase, the “Change in Control Offer”), subject to satisfaction by or on behalf of the Holder of the requirements set forth below.

 

(b)                                 Within 15 days after the occurrence of a Change in Control, the Company shall provide written notification to the Holders of the Change in Control and of the repurchase right arising as a result of the Change in Control (the “Change in Control Notice”).  The Change in Control Notice shall also be delivered to the Trustee. The Company is required to repurchase the Securities on the date that is neither less than 30 nor more than 60 business days after the date of the Change in Control Notice (such date, the “Change in Control Purchase Date”). The Change in Control Notice shall include a form of Change in Control Purchase Notice to be completed by the Holder containing the information contemplated by Section 13.01(c) and shall state:

 

(i)                                     the date of such Change in Control;

 

(ii)                                  the date by which the Change in Control Purchase Notice must be delivered to the Paying Agent;

 

(iii)                               the Change in Control Purchase Date;

 

(iv)                              the Change in Control Purchase Price;

 

(v)                                 the name and address of the Trustee and the Paying Agent;

 

(vi)                              that Securities must be surrendered to the Paying Agent (which surrender may, if applicable, be effected through the facilities of the Depositary) to collect payment of the Change in Control Purchase Price;

 

(vii)                           that the Change in Control Purchase Price for any Security as to which a Change in Control Purchase Notice has been duly given will be paid within five Business Days after the later of the Change in Control Purchase Date or the time at which such Securities are surrendered for repurchase;

 

(viii)                        that, unless the Company defaults in making payment of the Change in Control Purchase Price, such Securities shall cease to be Outstanding and interest on such Securities shall cease to accrue and all rights of the Holders of such Securities shall terminate on and after the Change in Control Purchase Date; and

 

(ix)                              the CUSIP number of the Securities.

 

(c)                                  A Holder may exercise its rights specified in this Section 13.01 upon delivery of a written notice of such Holder’s exercise of its repurchase right (a “Change in Control Purchase Notice”) to any Paying Agent or depositary specified in the Change in Control Purchase Notice at any time prior to the Close of Business on the second Business Day prior to the Change in Control Purchase Date, stating:

 

(i)                                     if such Securities are in certificated form, the certificate number(s) of the Securities which the Holder will deliver to be repurchased (if such Securities are

 

59

 

Global Securities, the Change in Control Purchase Notice shall comply with Applicable Procedures);

 

(ii)                                  the portion of the principal amount of the Securities to be repurchased, in multiples of $1,000, provided that the remaining principal amount of Securities is in an authorized denomination; and

 

(iii)                               that such Security shall be repurchased pursuant to the applicable provisions hereof and of the Securities.

 

The Trustee (or any Paying Agent) shall promptly notify the Company in writing of the receipt by it of any Change in Control Purchase Notice.

 

Transfers of interests in a Global Security in compliance with the Applicable Procedures or delivery of Securities in certificated form (together with all necessary endorsements) to the Paying Agent at the offices of the Paying Agent and delivery of such Security shall be conditions to the receipt by the Holder of the Change in Control Purchase Price therefor.  Holders electing to require the Company to repurchase Securities must effect such transfer or delivery to the Paying Agent prior to the Change in Control Purchase Date to receive payment of the Change in Control Purchase Price.

 

(d)                                 A Change in Control Purchase Notice is irrevocable and may not be withdrawn.

 

(e)                                  On or before 11:59 a.m. (New York City time) on the Change in Control Purchase Date, the Company shall deposit with the Paying Agent money sufficient to pay the aggregate Change in Control Purchase Price of the Securities to be purchased pursuant to this Section 13.01.  If the Paying Agent holds, in accordance with the terms of the Indenture, money sufficient to pay the Change in Control Purchase Price of such Securities on the Change in Control Purchase Date or the Business Day following the Change in Control Purchase Date, then, on and after such date, such Securities shall cease to be Outstanding and interest on such Securities shall cease to accrue and all rights of the Holders of such Securities shall terminate (other than the right to receive the Change in Control Purchase Price after delivery or transfer of the Securities).  Such will be the case whether or not book entry transfer of the Securities in book entry form is made and whether or not Securities in certificated form, together with the necessary endorsements, are delivered to the Paying Agent.

 

(f)                                   Notwithstanding the foregoing, no Securities may be repurchased by the Company in accordance with the provisions of this Section 13.01 if there has occurred and is continuing an Event of Default with respect to the Securities and the principal amount of the Securities has been accelerated and such acceleration has not been rescinded on or prior to such dates.

 

(g)                                  The Paying Agent will promptly return to the respective Holders thereof any Securities with respect to which a Change in Control Purchase Notice has been withdrawn in compliance with this Indenture.

 

60

 

To the extent that the aggregate amount of cash deposited by the Company pursuant to Section 3.01 exceeds the aggregate Change in Control Purchase Price or portions thereof that the Company is obligated to purchase, then promptly after the Change in Control Purchase Date, the Trustee or a Paying Agent, as the case may be, shall return any such excess cash to the Company.

 

SECTION 13.02 Securities Purchased in Part. Any Global Security that is to be purchased only in part shall be adjusted to reflect the amount of any decrease in the amount of Securities then Outstanding represented thereby by the Trustee in accordance with instructions given by a Company Order and shall be made on the records of the Trustee and the Depositary.  Any Security issued in certificated form that is to be purchased only in part shall be surrendered at the office of a Paying Agent, and promptly after the Change in Control Purchase Date, the Company shall execute and the Trustee shall authenticate and deliver to the Holder of such Security, without service charge, a new Security or Securities, of such authorized denomination or denominations as may be requested by such Holder (which must be equal to $1,000 principal amount or any integral thereof), in aggregate principal amount equal to, and in exchange for, the portion of the principal amount of the Security so surrendered that is not purchased.

 

SECTION 13.03 Purchase of Securities in Open Market. The Company may from time to time repurchase the Securities in open market purchases or negotiated transactions at varying prices without prior notice to Holders.  Any Security that the Company purchases or a third party purchases may, to the extent permitted by applicable law, be reissued or resold or may, at the Company’s or such third party’s option, be surrendered to the Trustee for cancellation. Any Securities surrendered for cancellation may not be reissued or resold and will be canceled promptly in accordance with Section 3.09.

 

61

 

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

 

	
 
    	
NORTHSTAR   REALTY FINANCE CORP.
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
[·]
    
	
 
    	
 
    	
Title:
    	
[·]
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
WILMINGTON   TRUST, NATIONAL
   ASSOCIATION, as Trustee,
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
[·]
    
	
 
    	
 
    	
Title:
    	
[·]
    

 

62

 

EXHIBIT A

 

[FORM OF SECURITY]

 

[Global Securities Legend]

 

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

 

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

 

NorthStar Realty Finance Corp.

 

3.00% Senior Notes due 2014

 

	
No.           
    	
 
    	
$
    
	
 
    	
 
    	
CUSIP   66704RAA8
    

 

NorthStar Realty Finance Corp., a corporation duly organized and existing under the laws of the State of Maryland (herein called the “Company”, which term includes any successor Person under the Indenture hereinafter referred to), for value received, hereby promises to pay to CEDE & CO., or registered assigns, $                                   (                                   DOLLARS on September 30, 2014 and to pay interest thereon from March   , 2014 at the rate of 3.00% per annum, until the principal hereof is paid or duly provided for, provided, however, that any principal and any such installment of interest, which is overdue shall bear interest at the rate of 3.00% per annum (to the extent that the payment of such interest shall be legally enforceable), from the dates such amounts are due until they are paid or duly provided for.  The interest so payable and punctually paid or duly provided for, on the Stated Maturity Date will, as provided in such Indenture, be paid to the Person in whose name this Security (or one or more predecessor Securities) is registered at the Close of Business on the Stated Maturity Date. Any such interest not so punctually paid or duly provided for will forthwith cease to be payable to the Holder on the Stated Maturity Date and may either be paid to the Person in whose name this Security (or one or more predecessor Securities) is registered at the Close of Business on a Special Record Date for the payment of such Defaulted Interest to be fixed by the Company, notice whereof shall be given

 

A-1

 

to Holders of securities not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful manner not inconsistent with the requirements of any securities exchange on which the Securities may be listed, and upon such notice as may be required by such exchange, all as more fully provided in said Indenture.

 

The Company shall pay the principal of and interest on any Global Security in immediately available funds to the Depositary or its nominee, as the case may be, as the registered Holder of such Global Security.  The Company shall pay the principal of any Definitive Security at the office or agency designated by the Company for that purpose.  The Company has initially designated the Trustee as its Paying Agent and Security Registrar in respect of the Securities as a place where Securities may be presented for payment or for registration of transfer.  The Company may, however, change the Paying Agent or Security Registrar for the Securities without prior notice to the Holders thereof and the Company may act as Paying Agent or Security Registrar for the Securities.  Payments on any Definitive Securities may be made, at the Company’s option (i) to Holders of Definitive Securities having an aggregate principal amount of Securities of $5,000,000 or less, by check mailed to the Holders of such Securities as their address in the Security Register and (ii) to Holders having an aggregate principal amount of Definitive Securities in excess of $5,000,000, by either check mailed to each Holder at its address in the Security Register or, upon application by a Holder to the Registrar not later than the relevant Regular Record Date, by wire transfer in immediately available funds to that Holder’s account within the United States, which application shall remain in effect until that Holder notifies, in writing, the Registrar to the contrary.

 

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

 

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

 

A-2

 

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

 

	
 
    	
NORTHSTAR   REALTY FINANCE CORP.,
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    	
[·]
    
	
 
    	
 
    	
Title:
    	
[·]
    
	
 
    	
 
    
	
 
    	
Attest:
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Name:
    	
[·]
    
	
 
    	
 
    	
Title:
    	
[·]
    

 

A-3

 

TRUSTEE’S CERTIFICATE OF AUTHENTICATION

 

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

 

Dated:

 

	
 
    	
WILMINGTON   TRUST, NATIONAL ASSOCIATION, AS TRUSTEE
    
	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
By
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    

 

A-4

 

FORM OF REVERSE OF SECURITY

 

This Security is one of a duly authorized issue of Securities of the Company designated as 3.00%  Senior Notes due 2014 (herein called the “Securities”), limited in aggregate principal amount on the Issue Date to $                           issued and to be issued under an Indenture, dated as of March   , 2014 (herein called the “Indenture,” which term shall have the meaning assigned to it in such instrument), between the Company and Wilmington Trust, National Association, as Trustee (herein called the “Trustee,” which term includes any successor trustee under the Indenture), and reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and immunities thereunder of the Company, the Trustee and the Holders of the Securities and of the terms upon which the Securities are, and are to be, authenticated and delivered.  The Company shall be entitled, subject to its compliance with the terms of the Indenture, to issue Additional Securities pursuant to Section 3.13 of the Indenture.  The Securities include the Securities issued on the Issue Date and any Additional Securities.  The Securities issued on the Issue Date and any Additional Securities are treated as a single class of securities under the Indenture.  In the event there is any conflict between the terms of this Note and of the Indenture, the Indenture shall govern.

 

The terms of the Securities include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939 (15 U.S.C. 7aaa-77bbbb (the “TIA”), as in effect on the date of the Indenture.  Notwithstanding anything to the contrary herein, the Securities are subject to all such terms, and Holders of Securities are referred to the Indenture and the TIA for a statement of such terms.

 

This Security is redeemable at the election of the Company prior to the Stated Maturity Date subject to the provisions of the Indenture.

 

Upon the occurrence of a Change in Control, the Holder has the right, at such Holder’s option, to require the Company to repurchase all of the Holder’s Securities or any portions thereof (in principal amounts of $1,000 or integral multiples in excess thereof) on the Change in Control Purchase Date at a price equal to the Change in Control Purchase Price.

 

As provided in and subject to the provisions of the Indenture, the Company, upon providing notice to Holders not later than 25 scheduled trading days prior to the Stated Maturity Date, has the right, at its election, to deliver to Holders of the Securities Company Common Shares in lieu of cash at the Stated Maturity Date of the Securities.

 

If an Event of Default shall occur and be continuing, there may be declared due and payable the principal of and accrued and unpaid interest, if any, on all of the outstanding Securities, in the manner and with the effect provided in the Indenture.

 

The Indenture permits, with certain exceptions as therein provided, the amendment thereof and the modification of the rights and obligations of the Company and the rights of the Holders of the Securities under the Indenture at any time by the Company and the Trustee with the consent of the Holders of a majority in aggregate principal amount of the Securities at the time Outstanding.  The Indenture also contains provisions permitting the Holders

 

A-5

 

of specified percentages in aggregate principal amount of the Securities at the time Outstanding, on behalf of the Holders of all the Securities, to waive compliance by the Company with certain provisions of the Indenture and certain past defaults under the Indenture and their consequences.  Any such consent or waiver by the Holder of this 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.

 

As provided in and subject to the provisions of the Indenture, the Holder of this Security shall not have the right to institute any proceeding with respect to the Indenture or for the appointment of a receiver or trustee or for any other remedy thereunder, unless such Holder shall have previously given the Trustee written notice of a continuing Event of Default with respect to the Securities, the Holders of not less than 25% in principal amount of the Securities at the time Outstanding shall have made written request to the Trustee to institute proceedings in respect of such Event of Default as Trustee and offered the Trustee indemnity satisfactory to the Trustee and the Trustee shall not have received from the Holders of a majority in principal amount of Securities at the time Outstanding a direction inconsistent with such request, and shall have failed to institute any such proceeding for 60 days after receipt of such notice, request and offer of indemnity.  The foregoing shall not apply to certain suits described in the Indenture, including any suit instituted by the Holder of this Security for the enforcement of any payment of principal hereof or any interest hereon on or after the respective due dates expressed herein.

 

No reference herein to the Indenture and no provision of this Security or of the Indenture shall alter or impair the obligation of the Company, 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.

 

As provided in the Indenture and subject to certain limitations therein set forth, the transfer of this Security is registrable in the Security Register, upon surrender of this Security for registration of transfer at the office or agency of the Company, duly endorsed by, or accompanied by a written instrument of transfer in form satisfactory to the Company and the Security Registrar duly executed by, the Holder hereof or his attorney duly authorized in writing, and thereupon one or more new Securities, of authorized denominations and for the same aggregate principal amount, will be issued to the designated transferee or transferees.

 

This Security is issuable only in registered form without coupons in denominations of $1,000 and any integral multiple thereof.  As provided in the Indenture and subject to certain limitations therein set forth, Securities are exchangeable for a like aggregate principal amount of Securities of like tenor of a different authorized denomination, as requested by the Holder surrendering the same.

 

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

 

A-6

 

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

 

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

 

All terms used in this Security which are defined in the Indenture shall have the meanings assigned to them in the Indenture.

 

The Indenture and this Security shall be governed by the laws of the State of New York, without regard to the principle of the conflicts of laws.

 

A-7

 

ASSIGNMENT FORM

 

To assign this Security, fill in the form below:

 

I or we assign and transfer this Security to

 

	
 
    
	
(Print or type assignee’s name, address and zip code)
    
	
 
    
	
 
    
	
(Insert assignee’s soc. sec. or tax I.D. No.)
    

 

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

 

	
Date:
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
Your Signature:     
    	
 
    
	
 
    	
 
    	
Sign exactly as your name appears on the other side of this Security.
    

 

A-8

 

TO BE ATTACHED TO GLOBAL SECURITIES SCHEDULE 
 OF INCREASES OR DECREASES IN GLOBAL SECURITY

 

The initial principal amount of this Global Security is $              .  The following increases or decreases in this Global Security have been made:

 

	
Date of Exchange
    	
 
    	
Amount of
   decrease in
   Principal Amount
   of this Global
   Security
    	
 
    	
Amount of increase
   in Principal
   Amount of this
   Global Security
    	
 
    	
Principal amount
   of this Global
   Security following
   such decrease or
   increase
    	
 
    	
Signature of
   authorized
   signatory of
   Trustee or
   Securities
   Custodian
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    

 

A-9Exhibit 10.10

 

Execution Copy

 

AMENDMENT NO. 3 TO MASTER REPURCHASE AND SECURITIES CONTRACT

 

AMENDMENT NO. 3 TO MASTER REPURCHASE AND SECURITIES CONTRACT, dated as of November 8, 2013 (this “Amendment”), between ACRC LENDER W LLC, a Delaware limited liability company (“Seller”), and WELLS FARGO BANK, NATIONAL ASSOCIATION, a national banking association (“Buyer”).  Capitalized terms used but not otherwise defined herein shall have the meanings given to them in the Repurchase Agreement (as defined below).

 

RECITALS

 

WHEREAS, Seller and Buyer are parties to that certain Master Repurchase and Securities Contract, dated as of December 14, 2011 (as amended by Buyer, Seller and Guarantor pursuant to Amendment No. 1 to Master Repurchase and Securities Contract dated as of May 22, 2012 (“Amendment No. 1”), and as amended by Buyer and Seller pursuant to Amendment No. 2 to Master Repurchase and Securities Contract dated as of June 27, 2013 (“Amendment No. 2”), and as amended, restated, supplemented or otherwise modified and in effect from time to time, the “Repurchase Agreement”); and

 

WHEREAS, Seller and Buyer have agreed to further amend certain provisions of the Repurchase Agreement in the manner set forth herein.

 

Therefore, in consideration of the premises and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Seller and Buyer each hereby agree as follows:

 

SECTION 1.                                     Amendments to Repurchase Agreement.

 

(a)                                 The defined terms “Future Funding Amount”, “Future Funding Date”, “Future Funding Request Package”, and “Future Funding Transaction”, as set forth in Article 2 of the Repurchase Agreement, are hereby amended and restated in their entirety to read as follows:

 

“Future Funding Amount”:  With respect to any Purchased Asset for which a Future Funding Transaction has been requested by Seller and approved by Buyer pursuant to Section 3.11, the product of (a) the amount that Seller is funding as a post-closing advance on the related Future Funding Date as required by the Underlying Loan Documents relating to such Purchased Asset, provided, in no event shall the aggregate amount so requested by Seller exceed the amount of future funding set forth on the related Confirmation for the initial Transaction relating to such Purchased Asset, minus all previous Future Funding Amounts funded by Buyer relating to such Purchased Asset, and (b) the Applicable Percentage for such Purchased Asset.

 

“Future Funding Date”:  With respect to any Purchased Asset for which a Future Funding Transaction has been requested by Seller and approved by Buyer,

 

 

the date on which Seller is required to fund a Future Funding Amount pursuant to the Underlying Loan Documents relating to such Purchased Asset.

 

“Future Funding Request Package”:  With respect to one or more Future Funding Transactions, the following, to the extent applicable and available, unless any such items were previously delivered to Buyer and have not been modified since the date of each such delivery:  (a) the related request for advance, executed by the related Underlying Obligor (which shall include evidence of Seller’s approval of the related Future Funding Transaction); (b) the related affidavit executed by the related Underlying Obligor; (c) the executed escrow agreement, if funding through escrow; (d) copies of all relevant trade contracts; (e) the title policy endorsement for the advance; (f) copies of any tenant leases; (g) copies of any service contracts; (h) updated financial statements, operating statements and rent rolls; (i) evidence of required insurance; (j) updates to the engineering report, if required pursuant to the related Underlying Loan Documents; and (k) copies of any additional documentation as required in connection therewith pursuant to the related Underlying Loan Documents.

 

“Future Funding Transaction”:  Any Transaction approved by Buyer pursuant to Section 3.11 where the funded amounts are to be applied for the funding of a post-closing advance with respect to either (a) any Securitized Purchased Asset, or (b) any Non-Securitized Purchased Asset, but only to the extent identified by Seller and approved by Buyer in the related Confirmation as a Purchased Asset for which Future Funding Transactions are permitted.

 

(b)                                 The initial, introductory paragraph of the definition of “Material Modification”, as set forth in Article 2 of the Repurchase Agreement, is hereby amended and restated in its entirety to read as follows:

 

“Material Modification”: Any material extension, amendment, waiver, termination, rescission, cancellation, release or other modification to the terms of, or any collateral, guaranty or indemnity for, or any other action, direction or decision that could adversely affect the value or collectability of any amounts due with respect to the Purchased Assets, as determined by Buyer.  Notwithstanding the foregoing, so long as no Material Facility Default or Event of Default has occurred, Seller (or Servicer, on its behalf) shall have the right without the consent of Buyer in each instance to enter into any amendment, deferral, extension, modification, increase, decrease, renewal, replacement, consolidation, supplement or waiver of, or to exercise any rights of a holder under (collectively, a “Loan Modification”), the Mortgage Loan Documents and such Loan Modification shall not constitute a Material Modification provided that either (I) if the related Loan Modification is being made in connection with a Securitized Purchased Asset, such Loan Modification satisfies all of the applicable terms, conditions and requirements which are set forth in the related participation agreement (it being understood, for the avoidance of doubt, that modifications to any such participation agreement are expressly prohibited under Section 8.03), or (II) the same does not:

 

2

 

(c)                                  The following, new defined terms are hereby added to Article 2 of the Repurchase Agreement in correct alphabetical order:  “Securitized Purchased Asset” and “Non-Securitized Purchased Asset”.

 

“Securitized Purchased Asset”:  Any Purchased Asset described on Schedule 4 hereto.

 

“Non-Securitized Purchased Asset”:  Any Purchased Asset other than those described on Schedule 4 hereto.

 

(d)                                 Section 3.11 of the Repurchase Agreement is hereby amended and restated in its entirety to read as follows:

 

SECTION 3.11              Future Funding Transactions.  Buyer’s agreement to enter into any Future Funding Transaction is subject to the satisfaction of the following conditions precedent, both immediately prior to entering into such Future Funding Transaction and also after giving effect to the consummation thereof:

 

(i)                           Seller shall give Buyer written notice of each Future Funding Transaction, together with a signed, written confirmation in the form of Exhibit J attached hereto prior to the related Future Funding Date (each, a “Future Funding Confirmation”), signed by a Responsible Officer of Seller.  Each Future Funding Confirmation shall identify the related Whole Loan and/or Senior Interest, shall identify Buyer and Seller and shall be executed by both Buyer and Seller; provided, however, that Buyer shall not be liable to Seller if it inadvertently acts on a Future Funding Confirmation that has not been signed by a Responsible Officer of Seller.  Each Future Funding Confirmation, together with this Agreement, shall be conclusive evidence of the terms of the Future Funding Transaction covered thereby, and shall be construed to be cumulative to the extent possible.  If terms in a Future Funding Confirmation are inconsistent with terms in this Agreement with respect to a particular Future Funding Transaction, other than with respect to the Applicable Percentage and Maximum Applicable Percentage set forth in such Future Funding Confirmation, this Agreement shall prevail.

 

(ii)                        For each proposed Future Funding Transaction, no less than seven (7) Business Days prior to the proposed Future Funding Date, Seller shall deliver to Buyer a Future Funding Request Package.  Buyer shall have the right to conduct an additional due diligence investigation of the Future Funding Request Package and/or the related Whole Loan and/or Senior Interest as Buyer determines.  Prior to the approval of each proposed Future Funding Transaction by Buyer, Buyer shall have determined, in its sole and absolute discretion, that all of the applicable conditions precedent for a Transaction, as described in Section 6.02(b), (e), (f) and (h) have been met by Seller and that the consummation of the

 

3

 

related Future Funding Transaction would not otherwise cause Seller to breach the Minimum Portfolio Debt Yield Test.  In addition thereto, for each proposed Future Funding Transaction which relates to a Non-Securitized Purchased Asset, the related Non-Securitized Purchased Asset shall, immediately before each Future Funding Transaction and immediately after giving effect thereto, satisfy both the Debt Yield Test and the PPV Test.  So long as all such conditions have been satisfied, no Default or Event of Default then-currently exist and Buyer has determined, in its sole and absolute discretion, that, if Buyer has not purchased from Seller a complete ownership interest in the entire related Whole Loan, that all of the terms and conditions relating to the splitting of such Whole Loan into multiple interests are satisfactory to Buyer in all respects, then Buyer shall be required to approve the related Future Funding Transaction on a timely basis.

 

(iii)                     Upon the approval by Buyer of a particular Future Funding Transaction, Buyer shall deliver to Seller a signed copy of the related Future Funding Confirmation described in clause (i) above, on or before the related Future Funding Date.  On the related Future Funding Date, which shall occur no later than three (3) Business Days after the final approval of the Future Funding Transaction by Buyer (a) if an escrow agreement has been established in connection with such Future Funding Transaction, Buyer shall remit the related Future Funding Amount to the related escrow account, (b) if the terms of the Underlying Loan Documents provide for a reserve account in connection with future advances, Buyer shall remit the related Future Funding Amount to the applicable reserve account, (c) if Seller has previously paid to the related Underlying Obligor the entire amount that Seller was then-currently required to pay to such Underlying Obligor, then Buyer shall remit the related Future Funding Amount directly to Seller, and (d) otherwise, Buyer shall remit the related Future Funding Amount directly to the related Underlying Obligor.

 

(e)                                  The fifth full sentence of Section 8.03 of the Repurchase Agreement is hereby amended and restated in its entirety to read as follows:

 

Seller shall not, or permit Interim Servicer to, make any Material Modification to any Purchased Asset, Senior Interest Document or Mortgage Loan Document, or to amend any participation agreement executed in connection with any Securitized Purchased Asset.

 

(f)                                   Exhibit J to the Repurchase Agreement is hereby amended, restated and replaced in its entirety with the attached Exhibit J hereto.

 

SECTION 2.                                     Conditions Precedent.  This Amendment and its provisions shall become effective on the first date on which this Amendment is executed and delivered by a duly authorized officer of each of Seller and Buyer (the “Amendment Effective Date”).

 

4

 

SECTION 3.                                     Representations, Warranties and Covenants.  Seller hereby represents and warrants to Buyer, as of the date hereof and as of the Amendment Effective Date, that (i) Seller is in compliance in all material respects with all of the terms and provisions set forth in each Repurchase Document to which it is a party on its part to be observed or performed, and (ii) no Default or Event of Default has occurred or is continuing.  Seller hereby confirms and reaffirms its representations, warranties and covenants contained in the Repurchase Agreement, except that Seller has changed its location in the past twelve (12) months.

 

SECTION 4.                                     Acknowledgement.  Seller hereby acknowledges that Buyer is in compliance with its undertakings and obligations under the Repurchase Agreement and the other Repurchase Documents.

 

SECTION 5.                                     Limited Effect.  Except as expressly amended and modified by this Amendment, Amendment No. 2 to the Guarantee Agreement by and between Seller and Guarantor dated as of June 27, 2013, Amendment No. 1 to the Fee Letter by and between Seller and Buyer dated as of June 27, 2013, Amendment No. 1 and Amendment No. 2, the Repurchase Agreement, the Fee Letter, and each of the other Repurchase Documents shall continue to be, and shall remain, in full force and effect in accordance with their respective terms; provided, however, that upon the Amendment Effective Date, (w) each reference therein and herein to the “Repurchase Documents” shall be deemed to include, in any event, this Amendment, (x) each reference to the “Repurchase Agreement” in any of the Repurchase Documents shall be deemed to be a reference to the Repurchase Agreement as amended hereby, and as previously amended by Amendment No. 1 and Amendment No. 2, (y) each reference to the “Fee Letter” in any of the Repurchase Documents shall be deemed to be a reference to the Fee Letter as amended by Amendment No. 1 to the Fee Letter, and (z) each reference in the Repurchase Agreement to “this Agreement”, this “Repurchase Agreement”, “hereof”, “herein” or words of similar effect in referring to the Repurchase Agreement shall be deemed to be references to the Repurchase Agreement as amended by this Amendment.

 

SECTION 6.                                     Counterparts.  This Amendment may be executed by each of the parties hereto on any number of separate counterparts, each of which shall be an original and all of which taken together shall constitute one and the same instrument.  Delivery of an executed counterpart of a signature page to this Amendment in Portable Document Format (PDF) or by facsimile transmission shall be effective as delivery of a manually executed original counterpart thereof.

 

SECTION 7.                                     Expenses.  Seller agrees to pay and reimburse Buyer for all out-of-pocket costs and expenses incurred by Buyer in connection with the preparation, execution and delivery of this Amendment, including, without limitation, the reasonable fees and disbursements of Cadwalader, Wickersham & Taft LLP, counsel to Buyer.

 

SECTION 8.                                     GOVERNING LAW.

 

THIS AMENDMENT AND ANY CLAIM, CONTROVERSY OR DISPUTE ARISING UNDER OR RELATED TO OR IN CONNECTION WITH THIS AMENDMENT, THE RELATIONSHIP OF THE PARTIES, AND/OR THE INTERPRETATION AND ENFORCEMENT OF THE RIGHTS AND DUTIES OF THE PARTIES WILL BE

 

5

 

GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO ANY CHOICE OR CONFLICT OF LAW PROVISION OR RULE (OTHER THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW) THAT WOULD CAUSE THE APPLICATION OF THE LAWS OF ANY OTHER JURISDICTION.

 

[SIGNATURES FOLLOW]

 

6

 

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

 

 

	
 
    	
SELLER
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ACRC LENDER W LLC, a Delaware   limited liability company
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   Thomas A. Jaekel
    
	
 
    	
 
    	
Name:   Thomas A. Jaekel
    
	
 
    	
 
    	
Title:   Vice President
    
	
 
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
BUYER
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
WELLS   FARGO BANK, N.A., a national banking association
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
/s/   John Nelson
    
	
 
    	
 
    	
Name:   John Nelson
    
	
 
    	
 
    	
Title:   Managing Director
    

 

 

EXHIBIT J

 

FORM OF FUTURE FUNDING CONFIRMATION

 

[    ] [  ], 20[   ]

 

Wells Fargo Bank, N.A.
 One Wells Fargo Center
 301 South College Street
 MAC D1053-125, 12th Floor
 Charlotte, North Carolina  28202

 

Attention:  Karen Whittlesey

 

Re:                             Master Repurchase and Securities Contract dated as of December 14, 2011, (the “Agreement”) between ACRC Lender W LLC (“Seller”) and Wells Fargo Bank, N.A. (“Buyer”)

 

Ladies and Gentlemen:

 

This is a Future Funding Confirmation (as this and other terms used but not defined herein are defined in the Agreement) executed and delivered by Seller and Buyer pursuant to Section 3.11 of the Agreement.  Seller and Buyer hereby confirm and agree that as of the Future Funding Date and upon the other terms specified below, shall advance funds to Seller, or at the request of Seller, to the borrower identified below related to the Purchased Assets listed identified below.

 

	
Related   Purchased Asset:
    	
                                                  
    
	
 
    	
 
    
	
Market   Value: (1)
    	
$                                               
    
	
 
    	
 
    
	
Applicable   Percentage: (2)
    	
           %
    
	
 
    	
 
    
	
Maximum   Applicable Percentage:
    	
          %
    
	
 
    	
 
    
	
Mortgage   Loan Documents:
    	
As   described in Appendix 1 hereto
    
	
 
    	
 
    
	
Future   Funding Date:
    	
[    ]   [  ], 20[   ]
    
	
 
    	
 
    
	
Purchase   Price:
    	
$                                              (1) x (2)
    
	
 
    	
 
    
	
Pricing   Margin:
    	
                                                
    
	
 
    	
 
    
	
Seller   Current Loan Amount:
    	
$                                              
    

 

 

	
Current   Approved Future Funding Amount:
    	
$                                              
    
	
 
    	
 
    
	
Seller’s   Remaining Future Funding Amount:
    	
$                                              
    

 

Seller hereby certifies as follows, on and as of the above Future Funding Date with respect to the Purchased Asset described in this Confirmation:

 

1.                                      All of the conditions precedent in Section 3.11 of the Agreement have been satisfied.

 

2.                                      Seller will make all of the representations and warranties contained in the Agreement (including Schedule 1 to the Agreement as applicable to the Class of such Asset) that it can make with respect to such Asset and specifying on the attached Exhibit 1 of their Future Funding Confirmation which representations and warranties Seller will be unable to make with respect to such Asset.

 

	
 
    	
Seller:
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
ACRC   LENDER W LLC
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    
	
 
    	
 
    	
Name:
    
	
 
    	
 
    	
Title:
    
	
 
    	
 
    
	
 
    	
 
    
	
Buyer:
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
Acknowledged   and Agreed:
    	
 
    
	
 
    	
 
    
	
Wells   Fargo Bank, N.A.
    	
 
    
	
By:
    	
 
    	
 
    
	
Name:
    	
 
    	
 
    
	
Title:

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