Document:

breit-ex102_1026.htm

Exhibit 10.2

MEMORANDUM OF DESIGNATION AND UNDERSTANDING

 

This MEMORANDUM OF DESIGNATION AND UNDERSTANDING (“Agreement”) is entered into as of June 2, 2019, by and among (i) BRE Jupiter LLC (“Buyer”), Blackstone Real Estate Partners VIII L.P. (together with its parallel funds and applicable alternative investment vehicles, “BREP VIII”) and Blackstone Real Estate Partners IX L.P. (together with its parallel funds and applicable alternative investment vehicles, “BREP IX”; and, together with the Buyer and BREP VIII, the “BREP Parties”) on the one hand, and (ii) Blackstone Real Estate Income Trust, Inc., a Maryland corporation (“BREIT”) on the other hand, to memorialize the understanding of the BREP Parties and BREIT in respect of their acquisition of certain entities being sold pursuant to the Transaction Agreement, dated as of June 2, 2019, by and among the Buyer Parties, the Seller Parties, the Acquired Companies, Management Holdings and the Seller Representative (each as defined therein; the Seller Parties, the Acquired Companies, Management Holdings and the Seller Representative are collectively referred to herein as the “Sellers”), a copy of which is attached as Schedule I hereto (as it may be amended or supplemented from time to time in accordance with this Agreement, the “Transaction Agreement”).  Unless otherwise set forth on Annex A hereto, capitalized terms used but not defined herein have the meanings given to them in the Transaction Agreement; provided that the definition of “Affiliate” as used herein shall exclude the proviso to such definition set forth in the Transaction Agreement, and BREIT shall not be considered to be an Affiliate of the Other BREP Funds.

RECITALS:

 

A.Buyer is a Subsidiary of BREP VIII and BREP IX and, pursuant to that certain Guaranty dated as of June 2, 2019, Blackstone Real Estate Partners VIII L.P. has guaranteed certain of the obligations of the Buyer under the Transaction Agreement.

 

B.Subject to its rights under the Transaction Agreement, BREIT anticipates acquiring, or certain of BREIT’s Subsidiaries acquiring, the Acquired Companies specified on Schedule II attached hereto (the “BREIT Allocated Entities”) from the Sellers on the terms and conditions set forth in the Transaction Agreement.

 

C.Subject to its rights under the Transaction Agreement, the balance of the Acquired Companies not being acquired by BREIT (the “BREP Allocated Entities”) are intended to be acquired directly or indirectly by BREP VIII, BREP IX and/or their respective parallel funds, applicable alternative investment vehicles and/or Subsidiaries and certain other investment funds, vehicles (including certain co-investment vehicles), accounts, trusts or companies sponsored or managed by affiliates of BREP VIII and BREP IX, respectively (the “Other BREP Funds”). 

 

D.(i) The purchase price allocation relating to the acquisition of the BREIT Allocated Entities by BREIT has been reviewed by the Affiliate Transaction Committee of the Board of Directors of BREIT and its independent advisors and (ii) the determination of the allocation of the investment opportunity relating to the Acquired Companies and the BREIT Allocated Entities has been made by BREIT’s investment adviser and other Affiliates of The Blackstone Group L.P. (“Blackstone”) in good faith in accordance with Blackstone’s investment allocation policies and procedures and the Second Amended and Restated Advisory Agreement, dated as of March 16, 2018, by and between BREIT, BREIT Operating Partnership, L.P. and BX REIT Advisors L.L.C.

 

E.In connection with the foregoing, the parties desire to enter into this Agreement with respect to BREIT’s acquisition of the BREIT Allocated Entities, and certain other agreements with respect to the rights of the parties with respect to the transactions contemplated under the Transaction Agreement.

 

 

 

 

AGREEMENT:

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by each of the parties hereto, each of the parties hereto agree as follows:

 

1.Designation and Assignment.  

 

a.Pursuant to Section 10.3 of the Transaction Agreement, Buyer agrees to promptly assign its rights to acquire the BREIT Allocated Entities to BREIT, or such Subsidiary or Subsidiaries of BREIT as BREIT may designate (the “Buyer Party Designee”), and BREIT agrees to accept such assignment.  

 

b.In furtherance but not in limitation of the foregoing, prior to the Closing, Buyer hereby agrees to transfer (the “Merger Sub Transfer”) to BREIT or such Subsidiary or Subsidiaries of BREIT as BREIT may designate, free and clear of all Liens, all of the equity interests issued and outstanding in the Merger Subs set forth opposite the name of any BREIT Allocated Entity on Exhibit A to the Transaction Agreement (the “Assigned Merger Subs”), and BREIT hereby agrees to (or agrees to cause its applicable Subsidiaries to) accept such transfer.  Following the Merger Sub Transfer, BREIT or such Subsidiary or Subsidiaries of BREIT as BREIT may designate, will be the sole owner of each of the Assigned Merger Subs.  The parties further agree that BREIT’s execution and delivery of this Agreement provides adequate consideration for the Merger Sub Transfer. 

 

2.Purchase and Sale Agreement Obligations.

a.BREIT’s Performance of Obligations.  Except for obligations that BREIT is not reasonably capable of performing because Buyer and (prior to the Merger Sub Transfer) the applicable Merger Subs are the signatories under the Transaction Agreement (which obligations the BREP Parties agree to cause the Buyer Parties to timely perform as required under the Transaction Agreement), BREIT agrees (and following the Merger Sub Transfer agrees to cause each of the Assigned Merger Subs) to timely perform all of the obligations of the Buyer Parties under the Transaction Agreement with respect to the BREIT Allocated Entities in accordance with the terms and conditions of the Transaction Agreement, including, following the Closing, with respect to the payment of transfer taxes pursuant to Section 6.2 of the Transaction Agreement.  Without limiting the foregoing, and subject to the terms and conditions of the Transaction Agreement and BREIT’s rights under this Agreement, at the Closing, BREIT agrees to:

i.pay to the Paying Agent, by wire transfer of immediately available funds denominated in dollars (to an account or accounts specified no later than two (2) Business Days prior to the Closing Date by the Paying Agent), an amount equal to (A) the portion of the Estimated Purchase Price allocable to such BREIT Allocated Entities under the Transaction Agreement as set forth in the Allocation pursuant to Section 2.6 of the Transaction Agreement, minus (B) the BREIT Pro Rata Portion (as defined below) of the Adjustment Escrow Amount, plus (C) the amount of all Closing Payoff Indebtedness attributable to the BREIT Allocated Entities in accordance with the Pay-Off Letters in such amounts and to such accounts as specified in the Pay-Off Letters; and 

 

 

ii.pay to the Escrow Agent, by wire transfer of immediately available funds denominated in dollars (to an account or accounts specified no later than two (2) Business Days prior to the Closing Date by the Escrow Agent), the amount set forth in clause (B) of the preceding clause (i).

b.Buyer Parties’ Performance of Obligations.  Subject to the terms and conditions of the Transaction Agreement, the BREP Parties agree to cause the Buyer Parties (other than the Assigned Merger Subs following the Merger Sub Transfer) to timely perform all of their respective obligations under the Transaction Agreement with respect to the BREP Allocated Entities.  Without limiting the foregoing, and subject to the terms and conditions of the Transaction Agreement and the BREP Parties’ rights under this Agreement, at the Closing, the BREP Parties agree to cause Buyer to pay the remaining amounts required to be paid pursuant to Section 2.3(b) of the Transaction Agreement (after taking into account the payments to be made by BREIT pursuant to Section 2(a) hereof).

 

c.Purchase Price Adjustment. Promptly following the determination of the Final Purchase Price pursuant to the Transaction Agreement, (i) if the BREIT Base Adjustment Amount is a positive number, Buyer will pay, or cause to be paid, to BREIT or its designee, by wire transfer of immediately available funds, an amount equal to the BREIT Base Adjustment Amount, up to the amount of the BREIT Adjustment Cap, and (ii) if the BREIT Base Adjustment Amount is a negative number, BREIT will pay, or cause to be paid, to Buyer or its designee, by wire transfer of immediately available funds, an amount equal to the BREIT True-Up Payment; provided, that if the Seller Adjustment Amount is a positive number, then the foregoing amounts in clause (i) shall not be required to be paid until amounts from the Adjustment Escrow Fund are released to Buyer or its designee.

 

3. Other Rights and Obligations under Transaction Agreement. The parties hereto also agree as follows:

 

a.Amendments; Consents; Approvals.  Buyer agrees that, without the prior written consent of BREIT, which may be withheld in its sole discretion, Buyer shall not amend, supplement or modify the Transaction Agreement, grant consents or approvals or waive any conditions thereto, in each case to the extent the same affects the BREIT Allocated Entities or the rights or obligations of BREIT (or any Subsidiary of BREIT) as the Buyer Party Designee.   Buyer shall: (i) provide BREIT no less than  two (2) days’ advance written notice of any proposed amendments, modifications or supplements to the Transaction Agreement; (ii) promptly provide BREIT with copies of (A) any written materials received from the Sellers (including, without limitation, memoranda, summaries, complaints and any other materials provided to Buyer pursuant to the Transaction Agreement), and (B) written notices from or to the Sellers, the Buyer Parties, any third-parties or any Governmental Entity given to or received by the Buyer Parties, in each case relating to the BREIT Allocated Entities or the rights or obligations of BREIT (or any Subsidiary of BREIT) as a Buyer Party Designee; and (iii) keep BREIT reasonably informed of the transactions contemplated by the Transaction Agreement.

 

b.Exercise of Pre-Closing Rights.  Buyer agrees to deliver any notice or election to the Sellers with respect to the BREIT Allocated Entities or any of the Buyer Parties’ rights that relate to BREIT’s rights or obligations under the Transaction Agreement as directed by BREIT.

	
 
	
c.
	
Post-Closing Indemnification.

 

 

 

i.BREP Indemnification.  Subject to BREIT’s obligation to first seek recovery from the Sellers for any losses, damages, costs or expenses (“Losses”) recoverable from the Sellers under the Transaction Agreement, following the Closing, the BREP Parties shall (severally and not jointly based on their percentage ownership of Buyer) indemnify, defend and hold harmless BREIT and its Subsidiaries, Affiliates, consultants, contractors and subcontractors and their respective employees, agents and representatives (collectively, the “BREIT Indemnity Parties”) from and against any Losses arising from any litigation, arbitration, claim action or proceeding (an “Action”) made or brought by a third party (a “Third Party Claim”) to the extent such Losses arise directly or indirectly from, result from or relate to the BREP Allocated Entities; provided that the Losses were not the result of negligence or misconduct of any BREIT Indemnity Party.  

ii.BREIT Indemnification.  Subject to the BREP Parties’ obligation to first seek recovery from the Sellers for Losses recoverable from the Sellers under the Transaction Agreement, following the Closing, BREIT shall indemnify, defend and hold harmless each BREP Party and its Subsidiaries, Affiliates, consultants, contractors and subcontractors and their respective employees, agents and representatives (collectively, the “BREP Indemnity Parties”) from and against any Losses arising from any Third Party Claim to the extent such Losses arise directly or indirectly from, result from or relate to the BREIT Allocated Entities; provided that the Losses were not the result of negligence or misconduct of any BREP Indemnity Party and that such indemnification is otherwise permitted by BREIT’s charter.

iii.Notice of Claims.  Each Person entitled to indemnification pursuant to Sections 3(c)(i) and 3(c)(ii) (an “Indemnified Party”) shall give written notice to the indemnifying party or parties from whom the indemnity is sought (the “Indemnifying Party”) promptly after obtaining knowledge of any claims that it may have under Sections 3(c)(i) and 3(c)(ii), as applicable.  The notice shall set forth in reasonable detail the claim and the basis for indemnification.  Failure to give notice shall not release the Indemnifying Party from its obligations under Sections 3(c)(i) and 3(c)(ii), as applicable, except to the extent that the failure prejudices the ability of the Indemnifying Party to contest that claim.

iv.Defense of Third Party Claims.  At its election the Indemnifying Party may assume the defense of the Third Party Claim, which  defense shall be conducted by counsel chosen by the Indemnifying Party, who shall be reasonably acceptable to the Indemnified Party, provided that the Indemnified Party shall retain the right to employ its own counsel and participate in the defense of the Third Party Claim at its own expense (which shall not be recoverable from the Indemnifying Party under this Section 3 unless (1) the Indemnified Party is advised by counsel that (x) there may be one or more legal defenses available to the Indemnified Party which are not available to the Indemnifying Party, or available to the Indemnifying Party and the assertion of which would be adverse to or in conflict with the interests of the Indemnified Party, or (y) that representation of both parties by the same counsel would be otherwise inappropriate under applicable standards of professional conduct, (2) the Indemnifying Party shall not have employed counsel to represent the Indemnified Party within thirty (30) Business Days after notice of the assertion of any such claim or institution of any such Third Party Claim, or (3) the Indemnifying Party shall authorize the Indemnified Party in writing to employ separate counsel at the expense of the Indemnifying Party, in each of which cases the reasonable expenses of counsel to the Indemnified Party shall be reimbursed by the Indemnifying 

 

 

Party).  Notwithstanding the foregoing provisions of this Section 3(c)(iv), (1) no Indemnifying Party shall be entitled to settle any Third Party Claim for which indemnification is sought under Sections 3(c)(i) and 3(c)(ii) without the Indemnified Party’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed, unless it has assumed the defense of such Third Party Claim and as part of the settlement the Indemnified Party is released from all liability with respect to the Third Party Claim and the settlement does not impose any equitable remedy on the Indemnified Party or require the Indemnified Party to admit any fault, culpability or failure to act by or on behalf of the Indemnified Party, and (2) no Indemnified Party shall be entitled to settle any Third Party Claim for which indemnification is sought under Sections 3(c)(i) and 3(c)(ii) without the Indemnifying Party’s prior written consent, which shall not be unreasonably withheld, conditioned or delayed.  Notwithstanding the foregoing provisions of this Section 3(c)(iv), if the Indemnifying Party does not notify the Indemnified Party within thirty (30) Business Days after receipt of the Indemnified Party’s notice of a Third Party Claim of indemnity hereunder that it elects to assume the control of the defense of any Third Party Claim, the Indemnified Party shall have the right to contest the Third Party Claim but shall not thereby waive any right to indemnity therefor pursuant to this Agreement and the costs of such Actions by the Indemnified Party shall be paid by the Indemnifying Party.

v.Limitations on Third Party Claims Liability.  

1.Notwithstanding the indemnifications set forth in Sections 3(c)(i) and 3(c)(ii), the Buyer shall not have any obligation or liability to the BREIT Indemnity Parties and BREIT shall not have any obligation or liability to the BREP Indemnity Parties with respect to any indirect, incidental, consequential, special or punitive damages.

2.An Indemnified Party shall first seek full recovery for any indemnifiable claims under this Agreement from the Sellers pursuant to and to the extent available under the Transaction Agreement.  The Indemnifying Party’s obligation under this Agreement shall be reduced by the amount of any such recovery under the Transaction Agreement, to the extent collected.   If the amount of any Losses suffered by any Indemnified Party is reduced by recovery from the Sellers under the Transaction Agreement, an amount equal to the amount of such reduction (not to exceed, in any event, the amount so previously paid in respect thereof by the Indemnifying Party) shall promptly be repaid by the Indemnified Party to the Indemnifying Party.

vi.The provisions of this Section 3 shall be the sole and exclusive remedies available to a party with respect to any Third Party Claim following the Closing. 

d.Efforts; HSR Act; Expenses. 

i.BREIT and Buyer each agree to comply with the provisions of Section 6.4 of the Transaction Agreement. 

ii.Subject to Section 5 below, the BREP Parties agree to reimburse BREIT, and BREIT agrees to reimburse the BREP Parties, so that (A) BREIT and the BREP Parties will bear 28.37% (the “BREIT Pro Rata Portion”) and 71.63% (the “BREP Pro Rata Portion”), respectively, of all Joint Transaction Expenses, (B) BREIT will bear 

 

 

100% of all BREIT Transaction Expenses and (C) the BREP Parties will collectively bear 100% of all BREP Transaction Expenses.  In this Agreement, “Joint Transaction Expenses” means any actual out-of-pocket costs or expenses incurred by a BREP Party or BREIT in connection with this Agreement, the Transaction Agreement, the Guaranty and/or the Transactions, including any amounts required to be paid pursuant to the penultimate sentence of Section 6.3(b) or Section 6.8(b) of the Transaction Agreement; provided, that Joint Transaction Expenses shall exclude any (1) cost or expense that solely relates to a BREIT Allocated Entity (a “BREIT Transaction Expense”) and (2) cost or expense that solely relates to a BREP Allocated Entity (a “BREP Transaction Expense”); provided that the Buyer Termination Fee shall not be included as a Joint Transaction Expense, a BREIT Transaction Expense or a BREP Transaction Expense except to the extent provided in Section 5(c) below.

iii.In furtherance but not in limitation of Section 3(d)(ii) above, to the extent that Buyer is entitled to receive the Seller Expense Reimbursement pursuant to the Transaction Agreement, then Buyer shall reimburse BREIT, by wire transfer of immediately available funds promptly following the receipt of the Seller Expense Reimbursement, an amount equal to the lesser of (A) the sum of (x) the BREIT Pro Rata Portion of the Joint Transaction Expenses and (y) any BREIT Transaction Expenses and (B) the amount of the Seller Expense Reimbursement together with any other fees or amounts actually received by Buyer from the Sellers in connection with the termination of the Transaction Agreement (the “Received Amount”); provided that if the aggregate Joint Transaction Expenses, BREP Transaction Expenses and BREIT Transaction Expenses (the “Aggregate Transaction Expenses”) exceed the Received Amount, then Buyer shall instead reimburse BREIT for an amount equal to (1) the amount set forth in the preceding clause (A) divided by (2) the Aggregate Transaction Expenses multiplied by (3) the Received Amount.

4.Confidentiality.   BREIT acknowledges and agrees to be bound by the confidentiality and press release provisions of the Transaction Agreement, as if such provisions were set forth herein in their entirety.  In addition, neither the BREP Parties nor BREIT shall disclose any information with respect to the transaction contemplated under this Agreement nor the existence of this Agreement to any person or entity without the written consent of the other party, other than: (a) their respective officers, directors, employees, agents, attorneys, accountants, advisors; (b) as required by any law, rule or regulation or judicial process or as necessary for the enforcement of this Agreement; (c) as requested or required by any state, federal or foreign authority or examiner regulating Buyer or BREIT; and (d) to the Sellers.  The BREP Parties and BREIT agree to seek the other’s prior written consent (not to unreasonably withheld, conditioned or delayed) prior to issuing any press release with respect to the transactions contemplated by the Transaction Agreement.  Notwithstanding the foregoing, but otherwise subject to the terms of this Agreement and the Transaction Agreement, the parties hereto agree that BREIT may release information concerning the transactions contemplated by this Agreement and the Transaction Agreement to comply with any applicable Laws, including pursuant to governmental regulations and statutes as required by Law for publicly filing entities, and may further publicly disclose the transactions contemplated by this Agreement and the Transaction Agreement consistent with any statements previously made in compliance with this Agreement or the Transaction Agreement.

5.Remedies.

a.In the event the Transaction Agreement is terminated as a result of BREIT’s default in the performance of its obligations under this Agreement or the Transaction Agreement (a “BREIT Purchase Default”) and no BREP Purchase Default (as defined below) has occurred, 

 

 

BREIT shall (i) indemnify, defend and hold harmless the BREP Indemnity Parties from and against any Losses (including under the Guaranty or the Buyer Termination Fee, if applicable, which, for the avoidance of doubt, shall not be considered to be a Joint Transaction Expense) to the extent such Losses directly or indirectly arise or result from such BREIT Purchase Default and (ii) to the extent not included in the preceding clause (i) or previously reimbursed pursuant to Section 3(d)(ii), reimburse the BREP Parties for the amount of all Aggregate Transaction Expenses incurred by a BREP Party; provided that BREIT shall not have any obligation or liability to the BREP Indemnity Parties under this Section 5(a) (A) for any amounts in excess of the sum of the Cap (as defined in the Guaranty) and the amounts referred to in the preceding clause (ii) or (B) with respect to any indirect, incidental, consequential, special or punitive damages. 

b.In the event the Transaction Agreement is terminated as a result of a BREP Party’s default in the performance of its obligations under this Agreement or the Transaction Agreement (a “BREP Purchase Default”) and no BREIT Purchase Default has occurred, the BREP Parties shall (i) indemnify, defend and hold harmless the BREIT Indemnity Parties from and against any Losses (including under the Guaranty or the Buyer Termination Fee, if applicable, which, for the avoidance of doubt, shall not be considered to be a Joint Transaction Expense) to the extent such Losses directly or indirectly arise or result from such BREP Purchase Default and (ii) to the extent not included in the preceding clause (i) or previously reimbursed pursuant to Section 3(d)(ii), reimburse the BREIT Parties for the amount of all Aggregate Transaction Expenses incurred by BREIT; provided that the BREP Parties shall not have any obligation or liability to the BREIT Indemnity Parties under this Section 5(b) (A) for any amounts in excess of the sum of the Cap (as defined in the Guaranty) and the amounts referred to in the preceding clause (ii) or (B) with respect to any indirect, incidental, consequential, special or punitive damages.

c.In the event that there is both a BREP Purchase Default and a BREIT Purchase Default, then the amount of the Buyer Termination Fee shall be deemed to be a Joint Transaction Expense for purposes of Section 3(d)(ii).

d.The provisions of this Section 5 shall be the sole and exclusive remedies available to a party in the event of a BREIT Purchase Default or BREP Purchase Default. 

6.Further Assurances.  Buyer and BREIT shall use commercially reasonable efforts to execute such instruments, documents, approvals and consents as are reasonably necessary or proper in order to complete and ensure the transactions contemplated hereby.

7.Effect of Agreement. This Agreement memorializes the understanding and agreement of the parties hereto with respect to the subject matter hereof, and each of the parties hereto hereby represents and warrants as of the date hereof that (i) this Agreement has been duly authorized, executed and delivered thereby and is the valid and legally binding obligation thereof in accordance with and subject to the terms and conditions of this Agreement  and (ii) the execution, delivery and performance of this Agreement by such party and the consummation of the transactions contemplated hereby will not, with or without the giving of notice or the lapse of time, or both violate any provision of law, statute, rule, regulation or executive order to which such party is subject; violate any judgment, order, writ or decree of any court applicable to such party; or result in the breach of or conflict with any term, covenant, condition or provision of, or constitute a default under, any material contract or other agreement or instrument, to which such party is or may be bound or affected.

 

 

8.Successors and Assigns.  This Agreement shall be binding upon and inure to the benefit of the respective permitted successors, assigns, and legal representatives of the parties hereto.  Nothing in this Agreement, express or implied, is intended to confer upon any person, other than the parties hereto or their respective successors and assigns, any rights or benefits under or by reason of this Agreement.  Neither this Agreement, nor any of the rights, obligations under this Agreement, may be assigned or delegated, in whole or in part, by operation of law or otherwise by any of the parties without the prior written consent of the other party.  

9.Entire Agreement.  It is expressly understood and agreed that this Agreement contains the entire agreement and understanding concerning the subject matter herein, and supersedes and replaces all prior negotiations and agreements between the parties hereto, whether written or oral.  The parties hereto acknowledge that they have read this Agreement and have executed it without relying upon any statements, representations, or warranties, written, or oral, not expressly set forth herein or incorporated herein by reference.

10.Waiver, Modification and Amendment.  No provision herein may be waived unless in writing signed by the party whose rights are thereby waived.  Waiver of any one provision herein shall not be deemed to be a waiver of any other provision herein.  This Agreement may be modified or amended only by written agreement executed by all of the parties hereto.

11.Governing Law.  This Agreement shall be governed by, and construed in accordance with, the laws of the State of New York.

12.Severability.  In the event that one or more of the provisions or portions thereof of this Agreement is determined to be illegal or unenforceable, the remainder of this Agreement shall not be affected thereby, and each of the remaining provisions or portion thereof shall remain, continue to be valid and effective and be enforceable to the fullest extent permitted by law.

13.No Third Party Beneficiaries.  This Agreement shall not confer any rights or remedies upon any Person other than the parties hereto, the Persons entitled to indemnification hereunder, and in each case their respective successors, heirs, legal representatives, and permitted assigns.

14.Counterparts.  This Agreement may be executed in any number of counterparts, each of which shall be deemed an original, and all when taken together shall constitute the Agreement.  This Agreement may be executed by facsimile signature or in portable document format (PDF).

 

***

 

 

 

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

 

 

BRE JUPITER LLC

 

 

By: _/s/ Tyler Henritze______________________

	
 
	

	
Name:  Tyler Henritze

	
 
	

	
Title:    Senior Managing Director and Vice President

 

 

BLACKSTONE REAL ESTATE PARTNERS VIII L.P. on behalf of itself and/or one or more of its parallel funds, alternative investment vehicles and/or subsidiaries

 

	
 
	
By: 
	
Blackstone Real Estate Associates VIII L.P., its general partner

 

	
 
	
By:
	
BREA VIII L.L.C., its general partner

 

By: _/s/ Tyler Henritze______________________

	
 
	

	
Name:  Tyler Henritze

Title:    Senior Managing Director and Vice President   

 

BLACKSTONE REAL ESTATE PARTNERS IX L.P. on behalf of itself and/or one or more of its parallel funds, alternative investment vehicles and/or subsidiaries

 

	
 
	
By: 
	
Blackstone Real Estate Associates IX L.P., its general partner

 

	
 
	
By:
	
BREA IX L.L.C., its general partner

 

By: _/s/ Tyler Henritze______________________

	
 
	

	
Name:  Tyler Henritze

Title:    Senior Managing Director and Vice President  

 

 

BLACKSTONE real estate income trust, INC.

	

	
 

By:__/s/ A.J. Agarwal_________________________

Name:  A.J. Agarwal

Title:  President and Director

[Signature Page to Designation Agreement]

 

Schedule I 

Transaction Agreement

 

(See attached)

 

 

Schedule II

BREIT Allocated Entities

 

	
•
	
Icon Newco Pool 5 GA/FL, LLC

	
•
	
Harvest A REIT LLC

	
•
	
Icon Newco Pool 4 Northeast/Midwest, LLC

	
•
	
Harvest C REIT LLC

	
•
	
Icon Newco Pool 6 West/Southwest, LLC

	
•
	
Icon Newco Pool 3 Midwest/Southeast, LLC

	
•
	
Harvest B REIT LLC

	
•
	
Icon Newco Pool 6 El Paso, LLC

	
•
	
Icon Newco Pool 4 DC/VA, LLC

	
•
	
Icon Newco Pool 2, LLC

	
•
	
Icon Newco Pool 3 Midwest, LLC

	
•
	
Icon Newco Pool 2 Northeast/Southwest, LLC

 

 

		
Annex A

Definitions

“Action” has the meaning set forth in Section 3(c)(i).

“Aggregate Transaction Expenses” has the meaning set forth in Section 3(d)(iii).

“Agreement” has the meaning set forth in the preamble hereto.

“Assigned Merger Subs” has the meaning set forth in Section 1(b).

“BREIT” has the meaning set forth in the preamble hereto.

“BREIT Adjustment Cap” means the greater of (a) the BREIT Escrow Amount plus the BREP True-Up Payment, and (b) the BREIT Available Escrow Amount; provided that in no event shall the BREIT Adjustment Cap exceed the Adjustment Escrow Amount. 

“BREIT Allocated Entities” has the meaning set forth in the recitals hereto.

“BREIT Available Escrow Amount” means the Adjustment Escrow Amount minus any positive BREP Base Adjustment Amount; provided that, for the avoidance of doubt, if the BREP Base Adjustment Amount is not a positive number, then the BREIT Available Escrow Amount shall equal the Adjustment Escrow Amount.

“BREIT Base Adjustment Amount” means an amount, which may be a positive or negative number, equal to (a) the portion of the Estimated Purchase Price allocable to the BREIT Allocated Entities under the Transaction Agreement as set forth in the Allocation pursuant to Section 2.6 of the Transaction Agreement minus (b) the portion of the Final Purchase Price allocable to the BREIT Allocated Entities under the Transaction Agreement as set forth in the Allocation pursuant to Section 2.6 of the Transaction Agreement.

“BREIT Escrow Amount” means an amount equal to $28,370,000.

“BREIT Indemnity Parties” has the meaning set forth in Section 3(c)(i).

“BREIT Pro Rata Portion” has the meaning set forth in Section 3(d)(ii).

“BREIT Purchase Default” has the meaning set forth in Section 5(b).

“BREIT Transaction Expense” has the meaning set forth in Section 3(d)(ii).

“BREIT True-Up Payment” means the absolute value of any BREIT Base Adjustment Amount that is a negative number; provided that the BREIT True-Up Payment shall not exceed the Adjustment Escrow Amount minus the Seller Adjustment Amount.  For the avoidance of doubt, (a) the BREIT True-Up Payment shall equal $0 if the BREIT Base Adjustment Amount is a positive number, and (b) it is intended that, if the Seller Adjustment Amount is a negative number, the amount of the proviso will be higher than the Adjustment Escrow Amount, and if the Seller Adjustment Amount is a positive number, the amount of the proviso will be lower than the Adjustment Escrow Amount.

 

“BREP Allocated Entities” has the meaning set forth in the recitals hereto.

 

 

“BREP Base Adjustment Amount” means an amount, which may be a positive or negative number, equal to (a) the portion of the Estimated Purchase Price allocable to the BREP Allocated Entities under the Transaction Agreement as set forth in the Allocation pursuant to Section 2.6 of the Transaction Agreement minus (b) the portion of the Final Purchase Price allocable to the BREP Allocated Entities under the Transaction Agreement as set forth in the Allocation pursuant to Section 2.6 of the Transaction Agreement.

“BREP Indemnity Parties” has the meaning set forth in Section 3(c)(ii).

“BREP IX” has the meaning set forth in the preamble hereto.

“BREP Parties” has the meaning set forth in the preamble hereto.

“BREP Pro Rata Portion” has the meaning set forth in Section 3(d)(ii).

“BREP Purchase Default” has the meaning set forth in Section 5(a).

“BREP Transaction Expense” has the meaning set forth in Section 3(d)(ii).

“BREP True-Up Payment” means the absolute value of any BREP Base Adjustment Amount that is a negative number; provided that the BREP True-Up Payment shall not exceed the Adjustment Escrow Amount minus the Seller Adjustment Amount.  For the avoidance of doubt, (a) the BREP True-Up Payment shall equal $0 if the BREP Base Adjustment Amount is a positive number, and (b) it is intended that, if the Seller Adjustment Amount is a negative number, the amount of the proviso will be higher than the Adjustment Escrow Amount, and if the Seller Adjustment Amount is a positive number, the amount in the proviso will be lower than the Adjustment Escrow Amount.

“BREP VIII” has the meaning set forth in the preamble hereto.

“Buyer” has the meaning set forth in the preamble hereto.

“Buyer Party Designee” has the meaning set forth in Section 1(a).

“Indemnified Party” has the meaning set forth in Section 3(c)(iii).

“Indemnifying Party” has the meaning set forth in Section 3(c)(iii).

“Joint Transaction Expenses” has the meaning set forth in Section 3(d)(ii).

“Merger Sub Transfer” has the meaning set forth in Section 1(b).

“Other BREP Funds” has the meaning set forth in the recitals hereto.

“Received Amount” has the meaning set forth in Section 3(d)(iii).

“Seller Adjustment Amount” means an amount, which may be a positive or a negative number, equal to the Estimated Purchase Price minus the Final Purchase Price, in each case as determined pursuant to the Transaction Agreement.

“Third Party Claim” has the meaning set forth in Section 3(c)(i).

“Transaction Agreement” has the meaning set forth in the preamble hereto.EXHIBIT
4.3

 

FORM
OF 2022 SENIOR GLOBAL NOTE

 

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

 

CUSIP
No. 53944VAS8

ISIN No. US53944VAS88

Common Code: 203192002

 

LLOYDS BANK
plc

 

2.250% SENIOR
NOTE DUE 2022

 

	No. [1]	$500,000,000

 

 

LLOYDS BANK
plc (herein called the “Company,” which term includes any successor person under the Indenture (as defined on the
reverse hereof)), for value received, hereby promises to pay to CEDE & CO., or registered assigns, the principal sum of $500,000,000
(five hundred million dollars) on August 14, 2022 or on such earlier date as the principal hereof may become due in accordance
with the terms hereof and to pay interest thereon semi-annually in arrears on February 14 and August 14 of each year (each, an
“Interest Payment Date”), commencing on February 14, 2020, and ending on August 14, 2022. Interest so payable on any
Interest Payment Date shall be paid to the Holder in whose name this Senior Note is registered on the 15th calendar
day immediately preceding the relevant Interest Payment Date, whether or not such day is a Business Day, as defined in the Indenture
(each a “Regular Record Date”). Any interest which is payable, but is not punctually paid or duly provided for, on
any Interest Payment Date is herein called “Default Interest”. Default Interest shall cease to be payable to the registered
Holder on the relevant Regular Record Date by virtue then of having been such Holder, and such Default Interest may be paid by
the Company, at its election in each case, as provided in clause (x) or (y) below: (x) the Company may elect to make payment of
any Default Interest to registered Holders at the close of business on a Special Record Date (a “Special Record Date”)
for the payment of such Default Interest, such Special Record Date to be fixed in accordance with Section 3.07(a) of the Indenture
or, (y) the

 

     

     

    

Company
may make payment of any Default Interest to the Persons in whose names such Senior Note is registered in the Senior Debt Security
Register in any other lawful manner not inconsistent with the requirements of any securities exchange on which this Note 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, such manner of payment shall be deemed practicable by the Trustee.

 

Interest
shall accrue on this Senior Note from day to day from the date of issuance hereof or from the most recent Interest Payment Date
at the rate of 2.250% per annum, until the principal amount hereof is paid or made available for payment.

 

Payments
of interest on this Senior Note shall be computed on the basis of a 360-day year divided into twelve months of 30 days each and,
in the case of an incomplete month, the actual number of days elapsed in such period.

 

Payment
of the principal amount of (and premium, if any) and any interest on, this Senior Note will be made in such coin or currency of
the United States of America as at the time of payment is legal tender for payment of public and private debts. Such payment shall
be made to the Holder. If the date for payment of the principal amount hereof (and premium, if any) or interest thereon is not
a Business Day, then (subject as provided in the Indenture) such payment shall be made on the next succeeding Business Day with
the same force and effect as if made on such date for payment and without any interest or other payment in respect of such delay.

 

Prior
to due presentment of this Senior Note 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 Senior Note is registered as the owner of such Senior Note for the purpose
of receiving payment of principal and interest, if any, on such Senior Note and for all other purposes whatsoever, whether or
not such Senior Note 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.

 

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

 

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

 

Notwithstanding
any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial Owner of this Senior Note,
by purchasing or acquiring this Senior Note, each Holder (including each Beneficial Owner) of this Senior Note acknowledges, accepts,
agrees to be bound by and consents to the exercise of any U.K. bail-in power (as defined below) by the relevant U.K. resolution
authority that may result in (i) the reduction or cancellation of all, or a portion, of the principal amount of, or interest on,
this Senior Note; (ii) the conversion of all, or a portion, of the principal

 

     

     

    

amount
of, or interest on, this Senior Note into shares or other securities or other obligations of the Company or another person; and/or
(iii) the amendment or alteration of the maturity of this Senior Note, or amendment of the amount of interest due on this Senior
Note, or the dates on which interest becomes payable, including by suspending payment for a temporary period; which U.K. bail-in
power may be exercised by means of variation of the terms of this Senior Note solely to give effect to the exercise by the relevant
U.K. resolution authority of such U.K. bail-in power. Each Holder and Beneficial Owner of this Senior Note further acknowledges
and agrees that the rights of the Holders and/or Beneficial Owners under this Senior Note are subject to, and will be varied,
if necessary, solely to give effect to, the exercise of any U.K. bail-in power by the relevant U.K. resolution authority.

 

For
these purposes, a “U.K. bail-in power” is any write-down, conversion, transfer, modification or suspension power existing
from time to time under any laws, regulations, rules or requirements relating to the resolution of banks, banking group companies,
credit institutions and/or investment firms incorporated in the United Kingdom in effect and applicable in the United Kingdom
to Lloyds Banking Group plc or its affiliates, including but not limited to any such laws, regulations, rules or requirements
which are implemented, adopted or enacted within the context of a European Union directive or regulation of the European Parliament
and of the Council establishing a framework for the recovery and resolution of credit institutions and investment firms and/or
within the context of a U.K. resolution regime under the U.K. Banking Act 2009 as the same has been or may be amended from time
to time (whether pursuant to the U.K. Financial Services (Banking Reform) Act 2013, secondary legislation or otherwise), pursuant
to which any obligations of a bank, banking group company, credit institution or investment firm or any of its affiliates can
be reduced, cancelled, modified, transferred and/or converted into shares or other securities or obligations of the obligor or
any other person (or suspended for a temporary period) or pursuant to which any right in a contract governing such obligations
may be deemed to have been exercised. A reference to the “relevant U.K. resolution authority” is to any authority
with the ability to exercise a U.K. bail-in power.

 

[The rest
of this page is intentionally left blank]

 

 

 

 

 

 

 

 

 

 

 

     

     

    

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

 

Dated: August 14, 2019

 

 

 

 

	 	LLOYDS BANK PLC
	 	
	 	 
	 	 	 
	 	By:	    
	 	 	Name:
	 	 	Title:

 

 

 

 

 

 

 

 

 

 

 

 

 

[[Fixed
Rate] Global Note Signature Page]

 

     

     

    

CERTIFICATE
OF AUTHENTICATION

 

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

 

Dated: August 14, 2019

 

 

	 	THE BANK OF NEW YORK MELLON, LONDON BRANCH, as Trustee
	 	
	 	 
	 	 	 
	 	By:	    
	 	 	Authorized Signatory

 

 

 

 

 

 

 

 

 

 

 

 

 

[[Fixed
Rate] Global Note Signature Page]

 

     

     

    

[REVERSE
OF SECURITY]

 

This
Senior Note is one of a duly authorized issue of securities of the Company (herein called the “Senior Notes”) issued
and to be issued in one or more series under a Senior Debt Securities Indenture, dated as of August 14, 2019 (herein called the
“Senior Indenture”), among the Company, as issuer, and The Bank of New York Mellon, acting through its London Branch
as trustee (herein called the “Trustee,” which term includes any successor trustee under the Senior Indenture), as
supplemented by the First Supplemental Indenture dated as of August 14, 2019, between the Company and the Trustee (the “First
Supplemental Indenture” and, together with the Senior Indenture, the “Indenture”) to which Indenture and all
indentures supplemental thereto reference is hereby made for a statement of the respective rights, limitations of rights, duties
and immunities thereunder of the Company, the Trustee and the Holders of the Senior Notes and of the terms upon which the Senior
Notes are, and are to be, authenticated and delivered.

 

This
Senior Note is one of the series designated on the face hereof, initially limited in aggregate principal amount to $1,500,000,000.
The Company may, without the consent of the Holders of the Senior Notes, issue additional notes having the same ranking and interest
rate, maturity date, redemption terms and other terms as the Senior Notes except for the price to the public, issue date and first
interest payment date, provided that such additional notes must be fungible with the outstanding Senior Notes for U.S. federal
income tax purposes. Any such Senior Notes, together with this Senior Note, will constitute a single series of securities under
the Indenture. The Senior Notes will initially be issued in the form of one or more global Senior Notes (each, a “Global
Senior Note”). Except as provided in the Indenture, a Global Senior Note shall not be exchangeable for one or more definitive
Senior Notes.

 

The
Senior Notes of this series will constitute unsecured and unsubordinated obligations of the Company, as described herein, and
will rank pari passu without any preference among themselves and at least pari passu with all of the Company’s
other outstanding unsecured and unsubordinated obligations, present and future, subject to such exceptions as may be provided
by mandatory provisions of applicable law.

 

If
an Event of Default with respect to the Senior Notes of this series shall have occurred and be continuing, the Trustee or the
Holder or Holders of not less than 25% in aggregate principal amount of the Outstanding Senior Notes of this series may declare
the principal amount of, and any accrued interest on, all the Senior Notes to be due and payable immediately, in the manner, with
the effect and subject to the conditions provided in the Indenture.

 

If
an Event of Default with respect to the Senior Notes of this series shall have occurred and be continuing, the Trustee may in
its discretion proceed to protect and enforce its rights and the rights of Holders of Senior Notes by such appropriate judicial
proceedings as the Trustee shall deem most effectual to protect and enforce any such rights, whether for the specific enforcement
of any covenant or agreement in the Indenture or in aid of the exercise of any power granted thereon, or to enforce any other

 

     

     

    

proper
remedy, including the institution of proceedings in England (but not elsewhere) for the winding up of the Company.

 

Subject
to applicable law, no Holder may exercise or claim any right of set-off, counterclaim, combination of accounts, compensation or
retention in respect of any amount owed to it by the Company arising under or in connection with the Senior Notes. The Holders
of Senior Notes by their acceptance thereof will be deemed to have waived any right of set-off, counterclaim, combination of accounts,
compensation and retention with respect to the Senior Notes or the Senior Indenture (or between the obligations under or in respect
of any Senior Notes and any liability owed by a Holder to the Company) that they might otherwise have against the Company.

 

Amounts
to be paid on the Senior Notes of this series will be made without deduction or withholding for, or on account of, any and all
present and future income, stamp and other taxes, levies, imposts, duties, charges or fees, levied, collected, withheld or assessed
by or on behalf of the United Kingdom or any political subdivision or authority thereof or therein having the power to tax (the
“Taxing Jurisdiction”), unless such deduction or withholding is required by law. If at any time a Taxing Jurisdiction
requires the Company to make such deduction or withholding, the Company will pay additional amounts with respect to the principal
of, and interest and any other payments on, the Senior Notes of this series (“Additional Amounts”) that are necessary
in order that the net amounts paid to the Holders, after the deduction or withholding, shall equal the amounts which would have
been payable on the Senior Notes if the deduction or withholding had not been required. However, this will not apply to
any such tax, levy, impost, duty, charge or fee, which would not have been deducted or withheld but for the fact that:

 

(i)
the Holder or the Beneficial Owner of the Senior Note is a domiciliary, national or resident of, or engaging in business or maintaining
a permanent establishment or is physically present in, the Taxing Jurisdiction or otherwise has some connection with the Taxing
Jurisdiction other than the holding or ownership of a Senior Note, or the collection of any payment of (or in respect of) principal
of, or interest or other payments on, any Senior Note,

 

(ii)
except in the case of winding-up in the United Kingdom, the relevant Senior Note is presented (where presentation is required)
for payment in the United Kingdom,

 

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

 

(iv)
the Holder or the Beneficial Owner of the relevant Senior Note or the Beneficial Owner of any payment of (or in respect of) principal
of, or interest or other payments on, the Senior Note failed to comply with a request of the Company or its liquidator or other
authorized person addressed to the Holder (x) to provide information

 

     

     

    

concerning
the nationality, residence or identity of the Holder or such Beneficial Owner or (y) to make any declaration or other similar
claim to satisfy any requirement, which in the case of (x) or (y), is required or imposed by a statute, treaty, regulation or
administrative practice of the Taxing Jurisdiction as a precondition to exemption from all or part of the tax, levy, impost, duty,
charge or fee,

 

(v)
the deduction or withholding is imposed by reason of any agreement with the U.S. Internal Revenue Service in connection with Sections
1471-1474 of the U.S. Internal Revenue Code and the U.S. Treasury regulations thereunder (“FATCA”), any intergovernmental
agreement between the United States and the United Kingdom or any other jurisdiction with respect to FATCA, or any law, regulation
or other official guidance enacted in any jurisdiction implementing, or relating to, FATCA or any intergovernmental agreement;
or

 

(vi)
any combination of clauses (i) through (v) above,

 

nor shall
Additional Amounts be paid with respect to the principal of, or any interest or other payments on, the Senior Note to any Holder
who is a fiduciary or partnership or any person other than the sole Beneficial Owner of such payment to the extent such payment
would be required by the laws of any Taxing Jurisdiction to be included in the income for tax purposes of a beneficiary or partner
or settlor with respect to such fiduciary or a member of such partnership or a Beneficial Owner who would not have been entitled
to such Additional Amounts, had it been the Holder.

 

References
herein to the payment of the principal of or interest or other payments on any Senior Note shall be deemed to include mention
of the payment of Additional Amounts provided for in the foregoing paragraph to the extent that, in such context, Additional Amounts
are, were or would be payable under the foregoing provisions.

 

In
the event that any withholding or deduction for or on account of any taxes is required, at least 10 days prior to each date of
payment of principal of or interest on this series of Senior Notes, or any other period of time as agreed between the Company
and the Trustee and the Paying Agent, if other than the Trustee, the Company will furnish to the Trustee and the Paying Agent,
if other than the Trustee, an Officer’s Certificate specifying the amount required to be withheld or deducted on such payments
to such Holders, certifying that the Company shall pay such amounts required to be withheld to the appropriate Taxing Jurisdiction
and certifying to the fact that the Additional Amounts will be payable and the amounts so payable to each Holder, and that the
Company will pay to the Trustee or the Paying Agent the Additional Amounts required to be paid; provided that no such Officer’s
Certificate will be required prior to any date of payment of principal of or interest on these Senior Notes if there has been
no change with respect to the matters set forth in a prior Officer’s Certificate. The Trustee and Paying Agent may rely
on the fact that any Officer’s Certificate contemplated by this paragraph has not been furnished as evidence of the fact
that no withholding or deduction for or on account of any taxes is required.

 

     

     

    

The
Senior Notes of this series are redeemable, as a whole but not in part, at the option of the Company, on not less than 30 nor
more than 60 days’ notice, on any Interest Payment Date, at a redemption price equal to 100% of the principal amount, together
with accrued but unpaid interest, in respect of the Senior Notes to the date fixed for redemption, if, at any time, the Company
shall determine that as a result of a change in or amendment to the laws or regulations of the Taxing Jurisdiction (including
any treaty to which such Taxing Jurisdiction is a party), or any change in the application or interpretation of such laws or regulations
(including a decision of any court or tribunal), which change or amendment becomes effective on or after the Issue Date:

 

(a)
in making payment under the Senior Notes the Company has or will or would on the next Interest Payment Date become obligated to
pay Additional Amounts;

 

(b)
the payment of interest on the next Interest Payment Date in respect of any of the Senior Notes would be treated as a “distribution”
within the meaning of Chapter 2 of Part 23 of the Corporation Tax Act 2010 of the United Kingdom (or any statutory modification
or re-enactment thereof for the time being); or

 

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

 

In any case
where the Company shall determine that as a result of any change in the application or interpretation of any laws or regulations
it is entitled to redeem the Senior Notes of this series, the Company shall be required to deliver to the Trustee prior to the
giving of any notice of redemption (i) a written legal opinion of independent United Kingdom counsel of recognized standing (selected
by the Company) in a form satisfactory to the Trustee confirming that the relevant change in the application or interpretation
of such laws or regulations has occurred and that the Company is entitled to exercise its right of redemption; and (ii) an Officer’s
Certificate, evidencing compliance with such provisions and stating that it is entitled to redeem the Senior Notes pursuant to
the terms of the Senior Notes.

 

If
the Company elects to redeem the Senior Notes of this series, the Senior Notes will cease to accrue interest from the date of
redemption, provided the redemption price has been paid in accordance with the Indenture.

 

Upon
payment of (i) the amount of principal (and premium, if any) so declared due and payable and (ii) accrued and unpaid interest,
all of the Company’s obligations in respect of the payment of the principal of (and premium, if any), and accrued and unpaid
interest on, the Senior Notes of this series shall terminate.

 

Notwithstanding
any other agreements, arrangements, or understandings between the Company and any Holder or Beneficial Owner of this Senior Note,
by purchasing or acquiring this Senior Note, each Holder (including each Beneficial Owner) of this Senior Note acknowledges, accepts,
agrees to be bound by and consents to the exercise of any

 

     

     

    

U.K.
bail-in power by the relevant U.K. resolution authority that may result in (i) the reduction or cancellation of all, or a portion,
of the principal amount of, or interest on, the Senior Notes; (ii) the conversion of all, or a portion, of the principal amount
of, or interest on, the Senior Notes into shares or other securities or other obligations of the Company or another person; and/or
(iii) the amendment or alteration of the maturity of the Senior Notes, or amendment of the amount of interest due on the Senior
Notes, or the dates on which interest becomes payable, including by suspending payment for a temporary period; which U.K. bail-in
power may be exercised by means of variation of the terms of the Senior Notes solely to give effect to the exercise by the relevant
U.K. resolution authority of such U.K. bail-in power. Each Holder and Beneficial Owner of the Senior Notes further acknowledges
and agrees that the rights of the Holders and/or Beneficial Owners under the Senior Notes are subject to, and will be varied,
if necessary, solely to give effect to, the exercise of any U.K. bail-in power by the relevant U.K. resolution authority.

 

By
purchasing or acquiring the Senior Notes, each Holder and Beneficial Owner of the Securities:

 

(i)
acknowledges and agrees that the exercise of the U.K. bail-in power by the relevant U.K. resolution authority in respect of the
Senior Notes shall not give rise to a default or an Event of Default for purposes of Section 315(b) (Notice of Default)
and Section 315(c) (Duties of the Trustee in Case of Default) of the Trust Indenture Act;

 

(ii)
to the extent permitted by the Trust Indenture Act, waives any and all claims against the Trustee for, agrees not to initiate
a suit against the Trustee in respect of, and agrees that the Trustee shall not be liable for, any action that the Trustee takes,
or abstains from taking, in either case in accordance with the exercise of the U.K. bail-in power by the relevant U.K. resolution
authority with respect to the Senior Notes; and

 

(iii)
acknowledges and agrees that, upon the exercise of any U.K. bail-in power by the relevant U.K. resolution authority, (a) the Trustee
shall not be required to take any further directions from Holders of the Senior Notes under Section 5.12 of the Senior Indenture,
and (b) neither the Senior Indenture nor the First Supplemental Indenture shall impose any duties upon the Trustee whatsoever
with respect to the exercise of any U.K. bail-in power by the relevant U.K. resolution authority. Notwithstanding the foregoing,
if, following the completion of the exercise of the U.K. bail-in power by the relevant U.K. resolution authority, the Senior Notes
remain outstanding (for example, if the exercise of the U.K. bail-in power results in only a partial write-down of the principal
of the Senior Notes), then the Trustee’s duties under the Indenture shall remain applicable with respect to the Senior Notes
following such completion to the extent that the Company and the Trustee shall agree pursuant to a supplemental indenture or an
amendment to the First Supplemental Indenture.

 

     

     

    

By
purchasing or acquiring the Senior Notes, each Holder and Beneficial Owner that acquires its Senior Notes in the secondary market
shall be deemed to acknowledge and agree to be bound by and consent to the same provisions specified in the Indenture to the same
extent as the Holders and Beneficial Owners of the Senior Notes that acquire the Senior Notes upon their initial issuance, including,
without limitation, with respect to the acknowledgement and agreement to be bound by and consent to the terms of the Senior Notes
related to the U.K. bail-in power.

 

By
purchasing or acquiring the Senior Notes, each Holder and Beneficial Owner shall be deemed to have (i) consented to the exercise
of any U.K. bail-in power as it may be imposed without any prior notice by the relevant U.K. resolution authority of its decision
to exercise such power with respect to the Senior Notes and (ii) authorized, directed and requested DTC and any direct participant
in DTC or other intermediary through which it holds such Senior Notes to take any and all necessary action, if required, to implement
the exercise of any U.K. bail-in power with respect to the Senior Notes as it may be imposed, without any further action or direction
on the part of such Holder or Beneficial Owner.

 

No
repayment of the principal amount of the Senior Notes or payment of interest on the Senior Notes shall become due and payable
after the exercise of any U.K. bail-in power by the relevant U.K. resolution authority unless, at the time that such repayment
or payment, respectively, is scheduled to become due, such repayment or payment would be permitted to be made by the Company under
the laws and regulations of the United Kingdom and the European Union applicable to the Company and the Group.

 

Upon
the exercise of the U.K. bail-in power by the relevant U.K. resolution authority with respect to the Senior Notes, the Company
shall provide a written notice to DTC as soon as practicable regarding such exercise of the U.K. bail-in power for purposes of
notifying Holders of such occurrence. The Company shall also deliver a copy of such notice to the Trustee for information purposes.

 

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 Senior Notes of each series to be affected thereby by the Company and the
Trustee with the consent of the Holders of not less than a majority in principal amount of the Senior Notes at the time outstanding
of each such series. The Indenture also contains provisions permitting the Holders of a majority in aggregate principal amount
of the outstanding Senior Notes of each series, on behalf of the Holders of all Senior Notes of such series, 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 Senior Note shall be conclusive and binding upon such Holder and upon all future
Holders of this Senior Note and of any Senior Note issued in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Senior Note.

 

No
reference herein to the Indenture and no provision of this Senior Note or of the Indenture shall alter or impair the obligation
of the Company, which is absolute and

 

     

     

    

unconditional,
to pay, if and when due and payable, the principal of (and premium, if any) and interest on, this Senior Note at the times, place
and rate, and in the coin or currency, herein prescribed.

 

As
set forth in, and subject to, the provisions of the Indenture, no Holder of any Senior Note of this series will have the right
to institute any proceeding with respect to the Indenture, this Senior Note or any remedy thereunder; provided, however,
that such limitations do not apply to a suit instituted by the Holder hereof for the enforcement of payment of the principal or
interest as and when the same shall have become due and payable in accordance with the terms hereof and the Indenture.

 

No
reference herein to the Indenture and no provision of this Senior Note or of the Indenture shall alter or impair the right of
the Holder of this Senior Note, which is absolute and unconditional, to receive payment of the principal of (and premium, if any)
and interest on, this Senior Note when due and payable in accordance with the provisions of this Senior Note and the Indenture.

 

This
Senior Note will be governed by the laws of the State of New York.

 

Unless
otherwise defined herein, all terms used in this Senior Note which are defined in the Indenture shall have the meanings assigned
to them in the Indenture.

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