EXHIBIT A

 

THIS AMENDED AND RESTATED CREDIT AGREEMENT dated as of March 21, 2012, by and
among Public Storage, a real estate investment trust formed under the laws of
the State of Maryland (the “Borrower”), each of the financial institutions
initially a signatory hereto together with their assignees pursuant to
Section 13.5.(d), each of WELLS FARGO SECURITIES, LLC and MERRILL LYNCH, PIERCE,
FENNER & SMITH INCORPORATED, as the Joint Lead Arrangers (the “Joint Lead
Arrangers”) and as the Joint Bookrunners (the “Joint Bookrunners”), Wells Fargo
Bank, National Association, as Agent, and Bank of America, N.A., as Syndication
Agent (the “Syndication Agent”).

 

WHEREAS, certain of the Lenders and other financial institutions have made
available to the Borrower a revolving credit facility in the initial amount of
$300,000,000 on the terms and conditions contained in that certain Credit
Agreement dated as of March 27, 2007 (as at any time amended and as in effect
immediately prior to the date hereof, the “Existing Credit Agreement”) by and
among the Borrower, the Lenders, the other financial institutions party thereto
and the Agent;

 

WHEREAS, the Agent and the Lenders desire to amend and restate the terms of the
Existing Credit Agreement and to make available to the Borrower a revolving
credit facility in the initial amount of $300,000,000 which may be increased to
$600,000,000, and which will include a competitive bid loan subfacility, a
$75,000,000 swingline subfacility and a $50,000,000 letter of credit
subfacility, all on the terms and conditions contained herein.

 

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged by the parties hereto, the parties hereto agree
that the Existing Credit Agreement is amended and restated as follows:

 

Article I. Definitions

Section 1.1.  Definitions.

In addition to terms defined elsewhere herein, the following terms shall have
the following meanings for the purposes of this Agreement:

 

“Absolute Rate” has the meaning given that term in Section 2.2.(c)(ii)(C).

 

“Absolute Rate Auction” means a solicitation of Bid Rate Quotes setting forth
Absolute Rates pursuant to Section 2.2.

 

“Absolute Rate Loan” means a Bid Rate Loan, the interest rate on which is
determined on the basis of an Absolute Rate pursuant to an Absolute Rate
Auction.

 

“Accession Agreement” means an Accession Agreement substantially in the form of
Annex I to the Guaranty.

 

 

 

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“Additional Costs” has the meaning given that term in Section 5.1.

 

“Adjusted EBITDA” means, with respect to the Borrower for any period, EBITDA of
the Borrower and its Subsidiaries determined on a consolidated basis less the
aggregate of all dividends or distributions paid or accrued by such Persons on
any Preferred Stock of such Persons during such period plus, if during such
period any of PS Business Parks, Inc., PS Business Parks L.P., any Subsidiary of
PS Business Parks, Inc., Shurgard Europe or any Subsidiary of Shurgard Europe is
not a Subsidiary of the Borrower, the amount of dividends or other distributions
actually paid by each of foregoing Persons that is not a Subsidiary to the
Borrower or any of its Subsidiaries during such period.

“Administrative Questionnaire” means the Administrative Questionnaire completed
by each Lender and delivered to the Agent in the form delivered by the Agent to
the Lenders from time to time.

 

“Affected Lender” has the meaning given that term in Section 5.6.

 

“Affiliate” means any Person (other than the Agent or any Lender) directly or
indirectly controlling, controlled by, or under common control with, the
Borrower.  For purposes of this definition, “control” (including with
correlative meanings, the terms “controlling”, “controlled by” and “under common
control with”) means the possession directly or indirectly of the power to
direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities or by contract or
otherwise.  The Affiliates of a Person shall include any officer, trustee or
director of such Person. In no event shall the Agent or any Lender be deemed to
be an Affiliate of the Borrower.

 

“Agent” means Wells Fargo Bank, National Association, as contractual
representative for the Lenders under the terms of this Agreement, and any of its
successors.

 

“Agreement Date” means the date as of which this Agreement is dated.

 

“Applicable Facility Fee” means the percentage set forth in the table below
corresponding to the Level at which the “Applicable Margin” is determined in
accordance with the definition thereof:

 

Level

Facility Fee

1

0.1250.080%

2

0.1500.100%

3

0.125%

34

0.150%

45

0.200%

5

0.300%

6

0.3000.250%

 

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Any change in the applicable Level at which the Applicable Margin is determined
shall result in a corresponding and simultaneous change in the Applicable
Facility Fee. The provisions of this definition shall be subject to Section
2.5.(c).

 

“Applicable Law” means all applicable provisions of constitutions, statutes,
rules, regulations and orders of all governmental bodies and all orders and
decrees of all courts, tribunals and arbitrators.

 

“Applicable Margin” means the percentage set forth below corresponding to the
ratio of Total Indebtedness to Gross Asset Value as determined in accordance
with Section 10.1.(a):

 

 

Level

Ratio of Total Indebtedness to Gross Asset Value

Applicable Margin for LIBOR Loans

Applicable Margin for Base Rate Loans

1

Less than or equal to 0.10 to 1.00

0.9000.850%

0.000

2

Greater than 0.10 to 1.00 but less than or equal to 0.20 to 1.00

0.9500.875%

0.000

3

Greater than 0.20 to 1.00 but less than or equal to 0.25 to 1.00

1.0000.950%

0.000

4

Greater than 0.25 to 1.00 but less than or equal to 0.35 to 1.00

1.1001.050%

0.0500

5

Greater than 0.35 to 1.00 but less than or equal to 0.45 to 1.00

1.3001.250%

0.250

6

Greater than 0.45 to 1.00

1.5001.450%

0.450

 

The Applicable Margin for Loans shall be determined by the Agent from time to
time, based on the ratio of Total Indebtedness to Gross Asset Value as set forth
in the Compliance Certificate most recently delivered by the Borrower pursuant
to Section 9.3.  Any adjustment to the Applicable Margin shall be effective as
of the first day of the calendar month immediately following the month during
which the Borrower delivers to the Agent the applicable Compliance Certificate
pursuant to Section 9.1.  If the Borrower fails to deliver a Compliance
Certificate pursuant to Section 9.3. and such failure to deliver continues for
more than 15 days after it was due to have been delivered, the Applicable Margin
shall equal the percentages corresponding to Level 6 until the second Business
Day following delivery of the required Compliance Certificate.  Notwithstanding
the foregoing, for the period from the SecondThird Amendment Effective Date
through but excluding the date on which the Agent first determines the
Applicable Margin for Loans as set forth above, the Applicable Margin shall be
determined based on Level 1. Thereafter, such Applicable Margin shall be
adjusted from time to time as set forth in this definition.  The provisions of
this definition shall be subject to Section 2.5.(c).

 

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“Assignee” has the meaning given that term in Section 13.5.(d).

 

“Assignment and Acceptance Agreement” means an Assignment and Acceptance
Agreement among a Lender, an Assignee and the Agent, substantially in the form
of Exhibit A.

 

“Base Rate” means the LIBOR Market Index Rate; provided, that if for any reason
the LIBOR Market Index Rate is unavailable, Base Rate shall mean the per annum
rate of interest equal to the Federal Funds Rate plus one percent (1.0%).

 

“Base Rate Loan” means a Revolving Loan bearing interest at a rate based on the
Base Rate.

 

“Benefit Arrangement” means at any time an employee benefit plan within the
meaning of Section 3(3) of ERISA which is not a Plan or a Multiemployer Plan and
which is maintained or otherwise contributed to by any member of the ERISA
Group.

 

“Bid Rate Borrowing” has the meaning given that term in Section 2.2.(b).

 

“Bid Rate Loan” means a loan made by a Lender under Section 2.2.(f).

 

“Bid Rate Note” means a promissory note of the Borrower substantially in the
form of Exhibit K, payable to the order of a Lender as originally in effect and
otherwise duly completed.

 

“Bid Rate Quote” means an offer in accordance with Section 2.2.(c) by a Lender
to make a Bid Rate Loan with one single specified interest rate.

 

“Bid Rate Quote Request” has the meaning given that term in Section 2.2.(b).

 

“Borrower” has the meaning set forth in the introductory paragraph hereof and
shall include the Borrower’s successors and permitted assigns.

 

“Borrower Information” has the meaning given that term in Section 2.5.(c).

 

“Business Day” means (a) any day other than a Saturday, Sunday or other day on
which banks in San Francisco, California or New York, New York are authorized or
required to close, and (b) if such day relates to a LIBOR Loan any such day on
which dealings in deposits in Dollars are conducted by and between banks in the
London interbank eurodollar market.  Unless specifically referenced in this
Agreement as a Business Day, all references to “days” shall be calendar days.

 

“Capitalization Rate” means 7.00%.

 

“Capitalized EBITDA” means, with respect to a Person and as of a given date,
(a) such Person’s EBITDA for the twofour fiscal quarters most recently ended
times (b) 2 and divided by  (cb) 7.75%the Capitalization Rate.  In determining
Capitalized EBITDA, EBITDA attributable to

 

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real estate properties either acquired or disposed of by such Person during such
twofour fiscal quarters shall be disregarded; provided,  however, EBITDA
attributable to real estate properties acquired by the Borrower or any of its
Subsidiaries during the twofour immediately preceding fiscal quarters may, at
the Borrower’s option, be included in determinations of the Capitalized EBITDA
of the Borrower.

 

“Capitalized Lease Obligation” means obligations under a lease that is required
to be capitalized for financial reporting purposes in accordance with GAAP.  The
amount of a Capitalized Lease Obligation is the capitalized amount of such
obligation determined in accordance with GAAP.

 

“Capitalized Unencumbered NOI” means as of a given date (a) Unencumbered NOI for
the four fiscal quarters most recently ended divided by (b) the Capitalization
Rate.  In determining Capitalized Unencumbered NOI, Unencumbered NOI
attributable to Eligible Properties either acquired or disposed of by such
Person during such four fiscal quarters shall be disregarded; provided, however,
Unencumbered NOI attributable to Eligible Properties acquired by the Borrower or
any of its Subsidiaries during the four immediately preceding fiscal quarters
may, at the Borrower’s option, be included in determinations of the Capitalized
Unencumbered NOI.

 

“Cash Collateralize” means, to pledge and deposit with or deliver to the Agent,
for the benefit of the Agent or, the Issuing Banks and the Lenders, as
collateral for Letter of Credit Liabilities or obligations of Lenders to fund
participations in respect of Letter of Credit Liabilities, cash or deposit
account balances or, if the Agent and the applicable Issuing Bank shall agree in
itstheir sole discretion, other credit support, in each case pursuant to
documentation in form and substance satisfactory to the Agent and the applicable
Issuing Bank.  “Cash Collateral” shall have a meaning correlative to the
foregoing and shall include the proceeds of such cash collateral and other
credit support.

 

“Cash Equivalents” means (a) marketable direct obligations issued or
unconditionally guaranteed by the United States Government or issued by an
agency thereof and backed by the full faith and credit of the United States of
America, in each case maturing within one year after the date of acquisition
thereof, (b) marketable direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any public
instrumentality thereof, maturing within  90 days after the date of acquisition
thereof and, at the time of acquisition, having one of the two highest ratings
obtainable from S&P and Moody’s (or, if at any time either of the foregoing
shall not be rating such obligations, then from such other nationally recognized
rating services acceptable to the Agent) and not listed for possible down-grade
in Credit Watch published by S&P; (c) commercial paper, other than commercial
paper issued by any Loan Party or any of their respective Affiliates, maturing
no more than 90 days after the date of creation thereof and, at the time of
acquisition, having a rating of at least A-2 or P-2 from either S&P or Moody’s
(or, if at any time neither S&P nor Moody’s shall be rating such obligations,
then the highest rating from such other nationally recognized rating services
acceptable to the Agent); (d) domestic certificates of deposit, time deposits
and bankers’ acceptances which mature within one year after the date of
acquisition thereof; and (e)  overnight securities, repurchase agreements, or
reverse repurchase agreements secured by any of the

 

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foregoing types of Securities or debt instruments issued, in each case, by
(i) any commercial bank organized under the laws of the United States of America
or any state thereof or the District of Columbia or Canada having combined
capital and surplus of not less than $250,000,000 or (ii) any Lender.

 

“Change of Control” means the occurrence of any of the following events: (a) the
Borrower is merged or consolidated with or into another Person with the effect
that the common stockholders of Borrower immediately prior to such merger or
consolidation hold less than seventy-five percent (75%) of the ordinary voting
power of the outstanding securities of the survivor of such merger or the Person
resulting from such consolidation; (b) during any period of 12 consecutive
months ending after the Agreement Date, individuals who at the beginning of any
such 12‑month period constituted the Board of DirectorsTrustees of the Borrower
(together with any new directorstrustees whose election by such Board or whose
nomination for election by the shareholders of the Borrower was approved by a
vote of a majority of the directorstrustees then still in office who were either
directorstrustees at the beginning of such period or whose election or
nomination for election was previously so approved) cease for any reason to
constitute a majority of the Board of DirectorsTrustees of the Borrower then in
office; or (cb) any “person” or “group” (as such terms are used in Sections
13(d) and 14(d) of the Exchange Act) other than any Excluded Shareholder, is or
becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the
Exchange Act, except that a Person will be deemed to have “beneficial ownership”
of all securities that such Person has the right to acquire, whether such right
is exercisable immediately or only after the passage of time), directly or
indirectly, of more than 25.030.0% of the total voting power of the then
outstanding voting stock of the Borrower.

 

“Commitment” means, as to each Lender, such Lender’s obligation to make
Revolving Loans pursuant to Section 2.1. and to issue (in the case of the
Agentan Issuing Bank) or participate in (in the case of the other Lenders)
Letters of Credit pursuant to Section 2.3.(a) and 2.3.(i) respectively, in an
amount up to, but not exceeding, (but in the case of the Agentan Issuing Bank,
excluding the aggregate amount of participations in the Letters of Credit held
by other Lenders) the amount set forth for such Lender on Schedule I as such
Lender’s “Commitment Amount” or as set forth in the applicable Assignment and
Acceptance Agreement or an agreement executed by a Person becoming a Lender in
accordance with Section 2.17., as the same may be reduced from time to time
pursuant to Section 2.13. and or otherwise pursuant to the terms of this
Agreement or as appropriate to reflect any assignments to or by such Lender
effected in accordance with Section 13.5. or increased as appropriate to reflect
any increase effected in accordance with Section 2.17.

 

“Commitment Percentage” means, with respect to any Lender, the percentage
obtained by dividing (a) the amount of such Lender’s Commitment by (b) the
aggregate amount of Commitments of all the Lenders, or, if the Commitments have
been terminated (whether pursuant to Section 11.2. or otherwise), the percentage
obtained by dividing (i) the aggregate unpaid principal amount of Loans and
Letter of Credit Liabilities owing to such Lender by (ii) the aggregate unpaid
principal amount of all Loans and Letter of Credit Liabilities.

 

“Compliance Certificate” has the meaning given that term in Section 9.3.

 

 

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“Continue”, “Continuation” and “Continued” each refers to the continuation of a
LIBOR Loan from one Interest Period to another Interest Period pursuant to
Section 2.10.

 

“Convert”, “Conversion” and “Converted” each refers to the conversion of a
Revolving Loan of one Type into a Revolving Loan of another Type pursuant to
Section 2.11.

 

“Credit Event” means any of the following: (a) the making (or deemed making) of
any Loan, (b) the Conversion of a Revolving Loan, (c) the Continuation of a
LIBOR Loan and (d) the issuance of a Letter of Credit.

 

“Credit Rating” means the lowest rating or implied rating assigned and published
by a Rating Agency to each series of rated senior unsecured long term
indebtedness of the Borrower.

 

“Debtor Relief Laws” means the Bankruptcy Code of 1978, as amended, and all
other liquidation, conservatorship, bankruptcy, assignment for the benefit of
creditors, moratorium, rearrangement, receivership, insolvency, reorganization,
or similar Applicable Laws relating to the relief of debtors in the United
States of America or other applicable jurisdictions from time to time in effect.

 

“Default” means any of the events specified in Section 11.1., whether or not
there has been satisfied any requirement for the giving of notice, the lapse of
time, or both.

 

“Defaulting Lender” means, subject to Section 3.10.(f), any Lender that (a) has
failed to (i) fund all or any portion of its Loans within 2 Business Days of the
date such Loans were required to be funded hereunder unless such Lender notifies
the Agent and the Borrower in writing that such failure is the result of such
Lender’s determination that one or more conditions precedent to funding (each of
which conditions precedent, together with any applicable default, shall be
specifically identified in such writing) has not been satisfied, or (ii) pay to
the Agent, the Swingline Lender, any Issuing Bank or any other Lender any other
amount required to be paid by it hereunder (including in respect of its
participation in Letters of Credit or Swingline Loans) within 2 Business Days of
the date when due, (b) has notified the Borrower, the Agent, any Issuing Bank or
the Swingline Lender in writing that it does not intend to comply with its
funding obligations hereunder, or has made a public statement to that effect
(unless such writing or public statement relates to such Lender’s obligation to
fund a Loan hereunder and states that such position is based on such Lender’s
determination that a condition precedent to funding (which condition precedent,
together with any applicable default, shall be specifically identified in such
writing or public statement) cannot be satisfied), (c) has failed, within 3
Business Days after written request by the Agent or the Borrower, to confirm in
writing to the Agent and the Borrower that it will comply with its prospective
funding obligations hereunder (provided that such Lender shall cease to be a
Defaulting Lender pursuant to this clause (c) upon receipt of such written
confirmation by the Agent and the Borrower), or (d) has, or has a direct or
indirect parent company that has, (i) become the subject of a proceeding under
any Debtor Relief Law, or (ii) had appointed for it a receiver, custodian,
conservator, trustee, administrator, assignee for the benefit of creditors or
similar Person charged with reorganization or liquidation of its business or
assets, including the Federal Deposit Insurance Corporation or any other state
or federal regulatory authority acting in such a capacity; provided that a
Lender shall not be a Defaulting

 

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Lender solely by virtue of the ownership or acquisition of any equity interest
in that Lender or any direct or indirect parent company thereof by a
Governmental Authority so long as such ownership interest does not result in or
provide such Lender with immunity from the jurisdiction of courts within the
United States of America or from the enforcement of judgments or writs of
attachment on its assets or permit such Lender (or such Governmental Authority)
to reject, repudiate, disavow or disaffirm any contracts or agreements made with
such Lender.  Any determination by the Agent that a Lender is a Defaulting
Lender under any one or more of clauses (a) through (d) above shall be
conclusive and binding absent manifest error, and such Lender shall be deemed to
be a Defaulting Lender (subject to Section 3.10.(f)) upon delivery of written
notice of such determination to the Borrower, the Swingline Lender, the Issuing
Banks and each Lender.

 

“Derivatives Contract” means any and all rate swap transactions, basis swaps,
credit derivative transactions, forward rate transactions, commodity swaps,
commodity options, forward commodity contracts, equity or equity index swaps or
options, bond or bond price or bond index swaps or options or forward bond or
forward bond price or forward bond index transactions, interest rate options,
forward foreign exchange transactions, cap transactions, floor transactions,
collar transactions, currency swap transactions, cross-currency rate swap
transactions, currency options, spot contracts, or any other similar
transactions or any combination of any of the foregoing (including any options
to enter into any of the foregoing), whether or not any such transaction is
governed by or subject to any master agreement.  Not in limitation of the
foregoing, the term “Derivatives Contract” includes any and all transactions of
any kind, and the related confirmations, which are subject to the terms and
conditions of, or governed by, any form of master agreement published by the
International Swaps and Derivatives Association, Inc., any International Foreign
Exchange Master Agreement, or any other master agreement, including any such
obligations or liabilities under any such master agreement.

 

“Derivatives Termination Value” means, in respect of any one or more Derivatives
Contracts, after taking into account the effect of any legally enforceable
netting agreement relating to such Derivatives Contracts, (a) for any date on or
after the date such Derivatives Contracts have been closed out and termination
value(s) determined in accordance therewith, such termination value(s), and
(b) for any date prior to the date referenced in clause (a) the amount(s)
determined as the mark-to-market value(s) for such Derivatives Contracts, as
determined based upon one or more mid-market or other readily available
quotations provided by any recognized dealer in such Derivatives Contracts
(which may include the Agent or any Lender).

 

“Designated Account” means deposit account number 4648059228 of the Borrower
maintained with the Agent, or such other deposit account of the Borrower
maintained with the Agent and that the Borrower, in a written notice purportedly
signed by two of the Borrower’s corporate officers, one of which must be the
chief executive officer, the chief financial officer or the controller, may
designate to the Agent as the “Designated Account”.

 

“Development Property” means a Property currently under development on which the
improvements have not been completed, or a Property where development has been
completed as

 

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evidenced by a certificate of occupancy for the entire Property for the 30 month
period following the issuance of such certificate of occupancy (provided that
Borrower may at its option elect to remove a Property from the category of
Development Properties prior to the completion of the 30 month period, but any
such Property may not be reclassified as a Development Property).  The term
“Development Property” shall include real property of the type described in the
immediately preceding sentence to be (but not yet) acquired by the Borrower, any
Subsidiary or any Unconsolidated Affiliate upon completion of construction
pursuant to a contract in which the seller of such real property is required to
develop or renovate prior to, and as a condition precedent to, such acquisition.

 

“Dollars” or “$” means the lawful currency of the United States of America.

 

“EBITDA” means, with respect to any Person for any period and without
duplication: (a) net earnings (loss) of such Person for such period (including
equity in net earnings or net loss of Unconsolidated Affiliates) excluding the
impact of the following amounts with respect to any Person and the
Unconsolidated Affiliates (but only to the extent included in determining net
earnings (loss) for such period): (i) depreciation and amortization expense and
other non-cash charges of such Person for such period; (ii) interest expense of
such Person for such period; (iii) income tax expense of such Person in respect
of such period; (iv) extraordinary and nonrecurring gains and losses of such
Person for such period, including without limitation, gains and losses from the
sale of assets, write-offs and forgiveness of debt; and (v)
minoritynon-controlling interests, and (vi) distributions or other allocations
of income to holders of Preferred Stock; minus (b) the Reserve for
Replacements., and minus (c) if during such period any of PS Business Parks,
Inc., PS Business Parks L.P., any Subsidiary of PS Business Parks, Inc.,
Shurgard Europe or any Subsidiary of Shurgard Europe is not a Subsidiary of the
Borrower, the impact on EBITDA of each of the foregoing Persons that is not a
Subsidiary.

 

“Effective Date” means the later of (a) the Agreement Date and (b) the date on
which all of the conditions precedent set forth in Section 6.1.(a) shall have
been fulfilled or waived in writing by the Agent.

 

“Eligible Assignee” means any Person who is: (i) currently a Lender; (ii) a
commercial bank, trust company, insurance company, investment bank or pension
fund organized under the laws of the United States of America, or any state
thereof, or the District of Columbia, and having total assets in excess of
$5,000,000,000; or (iii) a commercial bank organized under the laws of any other
country which is a member of the Organization for Economic Cooperation and
Development (“OECD”), or a political subdivision of any such country, and having
total assets in excess of $10,000,000,000, provided that such bank is acting
through a branch or agency located in the United States of America.  If such
Person is not currently a Lender, such Person’s senior unsecured long term
indebtedness must be rated BBB or higher by S&P, Baa2 or higher by Moody’s, or
the equivalent or higher of either such rating by another Rating Agency
acceptable to the Agent. 

 

“Eligible Property” means a Property which satisfies all of the following
requirements: (a) such Property is owned in fee simple, or leased under a Ground
Lease, by the Borrower or a Wholly Owned Subsidiary and is located in a State of
the United States of America or in the

 

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District of Columbia; provided, that if a Subsidiary does not meet the
definition of “Wholly Owned Subsidiary” solely because such Subsidiary has
issued partnership interests that are or will be convertible at the option of
the holder of such partnership interest into the Equity Interests or Preferred
Stock of the Borrower, such Subsidiary shall be considered a “Wholly Owned
Subsidiary” for purposes of this clause (a); (b) regardless of whether such
Property  is owned in fee simple or leased under a Ground Lease by the Borrower
or a Wholly Owned Subsidiary, the Borrower has the right directly, or indirectly
through a Subsidiary, to take the following actions without the need to obtain
the consent of any Person: (i) to create Liens on such Property as security for
Indebtedness of the Borrower or such Subsidiary, as applicable and (ii) to sell,
transfer or otherwise dispose of such Property; (c) neither such Property, nor
if such Property is owned or leased under a Ground Lease by a Subsidiary, any of
the Borrower’s direct or indirect ownership interest in such Subsidiary, is
subject to (i) any Lien other than Permitted Liens or (ii) any Negative Pledge;
and (d) the Borrower has obtained a “Phase I” environmental assessment or other
appropriate environmental assessment with respect to such Property, and such
assessment does not indicate the existence of any condition that has, or could
reasonably expected to have, a materially adverse effect on the condition, fair
market value or net operating income of such Property.such Property is free of
all major structural defects or major architectural deficiencies, title defects,
environmental conditions or other adverse matters except for defects,
deficiencies, conditions or other matters which,  collectively, are not material
to the profitable operation of the Property.  In addition, any Property that is
owned by a Subsidiary of the Borrower is the subject of a bankruptcy proceeding
or other proceeding, event or condition of the types referred to in
Section 11.1.(e) or 11.1.(f) (and in the case of any case or proceeding
described in 11.1.(f), such case or proceeding has continued undismissed or
unstayed for a period of 60 consecutive calendar days or an order for relief
shall have been entered) shall cease to be an Eligible Property. 

“Environmental Laws” means any Applicable Law relating to environmental
protection or the manufacture, storage, disposal or clean‑up of Hazardous
Materials including, without limitation, the following: Clean Air Act, 42 U.S.C.
§ 7401 et seq.; Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.;
Solid Waste Disposal Act, 42 U.S.C. § 6901 et seq.; Comprehensive Environmental
Response, Compensation and Liability Act, 42 U.S.C. § 9601 et seq.; National
Environmental Policy Act, 42 U.S.C. § 4321 et seq.; regulations of the
Environmental Protection Agency and any applicable rule of common law and any
judicial interpretation thereof relating primarily to the environment or
Hazardous Materials.

 

“Equity Interest” means, with respect to any Person, any share of capital stock
of (or other ownership or profit interests in) such Person, any warrant, option
or other right for the purchase or other acquisition from such Person of any
share of capital stock of (or other ownership or profit interests in) such
Person, any security convertible into or exchangeable for any share of capital
stock of (or other ownership or profit interests in) such Person or warrant,
right or option for the purchase or other acquisition from such Person of such
shares (or such other interests), and any other ownership or profit interest in
such Person (including, without limitation, partnership, member or trust
interests therein), whether voting or nonvoting, and whether or not such share,
warrant, option, right or other interest is authorized or otherwise existing on
any date of determination.

 

 

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“Equity Issuance” means any issuance or sale by a Person of any Equity Interest.

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as in effect
from time to time.

 

“ERISA Group” means the Borrower, any Subsidiary and all members of a controlled
group of corporations and all trades or businesses (whether or not incorporated)
under common control which, together with the Borrower or any Subsidiary, are
treated as a single employer under Section 414 of the Internal Revenue Code.

 

“Event of Default” means any of the events specified in Section 11.1., provided
that any requirement for notice or lapse of time or any other condition has been
satisfied.

 

“Exchange Act” means the Securities Exchange Act of 1934, as amended from time
to time, together with all rules and regulations issued thereunder.

 

“Excluded Shareholder” means (a) any Hughes Family Member and (b) any Person
eligible to file a statement on Schedule 13G pursuant to Rule 13d‑1(b)(1) of the
Exchange Act.

 

“Existing Credit Agreement” has the meaning given that term in the first WHEREAS
clause of this Agreement.

 

“Existing Letters of Credit” has the meaning given that term in Section 2.3.(l).

 

“Fair Market Value” means, (a) with respect to a security listed (or an unlisted
convertible security that is convertible into a security listed) on The NASDAQ
Stock Market’s National Market System or have trading privileges on the New York
Stock Exchange, the American Stock Exchange, or another recognized national
United States securities exchange, the London Stock Exchange, Euronext or
another recognized European securities exchange, the price of such security as
reported on such exchange or market by any widely recognized reporting method
customarily relied upon by financial institutions and (b) with respect to any
other asset, the price which could be negotiated in an arm’s-length free market
transaction, for cash, between a willing seller and a willing buyer, neither of
which is under pressure or compulsion to complete the transaction. Except as
otherwise provided herein, Fair Market Value under clause (b) shall be
determined by the Board of DirectorsTrustees of the Borrower acting in good
faith conclusively evidenced by a board resolution thereof delivered to the
Agent or, with respect to any asset valued at up to $5,000,000, such
determination may be made by the chief financial officer or treasurer of the
Borrower evidenced by an officer’s certificate delivered to the Agent.

 

“Federal Funds Rate” means, for any day, the rate per annum (rounded upward to
the nearest 1/100th of 1%) equal to the weighted average of the rates on
overnight Federal funds transactions with members of the Federal Reserve System
arranged by Federal funds brokers on such day, as published by the Federal
Reserve Bank of New York on the Business Day next succeeding such day, provided
that (a) if such day is not a Business Day, the Federal Funds Rate for such day
shall be such rate on such transactions on the next preceding Business Day, and
(b)

 

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if no such rate is so published on such next succeeding Business Day, the
Federal Funds Rate for such day shall be the average rate quoted to the Agent by
federal funds dealers selected by the Agent on such day on such transaction as
determined by the Agent.

 

“Fees” means the fees and commissions provided for or referred to in
Section 3.6. and any other fees payable by the Borrower hereunder or under any
other Loan Document.

 

“Fixed Charges” means, with respect to a Person and for a given period, the sum
of (a) the Interest Expense of such Person for such period, plus (b) the
aggregate of all scheduled principal payments on Indebtedness made by such
Person during such period (excluding balloon, bullet or similar payments of
principal due upon the stated maturity of Indebtedness),  plus (c) the aggregate
of all dividends or distributions paid or accrued by such Person on any
Preferred Stock during such period. 

 

“Fronting Exposure” means, at any time there is a Defaulting Lender, (a) with
respect to the Agenteach Issuing Bank, such Defaulting Lender’s Commitment
Percentage of the outstanding Letter of Credit Liabilities attributable to such
Issuing Bank other than Letter of Credit Liabilities as to which such Defaulting
Lender’s participation obligation has been reallocated to other Lenders or Cash
Collateralized in accordance with the terms hereof, and (b) with respect to the
Swingline Lender, such Defaulting Lender’s Commitment Percentage of outstanding
Swingline Loans other than Swingline Loans as to which such Defaulting Lender’s
participation obligation has been reallocated to other Lenders.

 

“GAAP” means generally accepted accounting principles set forth in the opinions
and pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other statements by such other
entity as may be approved by a significant segment of the accounting profession,
which are applicable to the circumstances as of the date of determination.

 

“Governmental Approvals” means all authorizations, consents, approvals, licenses
and exemptions of, registrations and filings with, and reports to, all
Governmental Authorities.

 

“Governmental Authority” means any national, state or local government (whether
domestic or foreign), any political subdivision thereof or any other
governmental, quasi‑governmental, judicial, public or statutory instrumentality,
authority, body, agency, bureau or entity (including, without limitation, the
Federal Deposit Insurance Corporation, the Comptroller of the Currency or the
Federal Reserve Board, any central bank or any comparable authority) or any
arbitrator with authority to bind a party at law.

 

“Gross Asset Value” means, at a given time, the sum (without duplication) of
(a) Capitalized EBITDA of the Borrower and its Subsidiaries determined on a
consolidated basis, excluding Capitalized EBITDA attributable to Properties
acquired by the Borrower or such Subsidiary during the immediately preceding
four consecutive  fiscal quarters of the Borrower and Development Properties,
plus (b) all cash and cash equivalents (excluding tenant deposits and other cash
and cash equivalents the disposition of which is restricted) of the Borrower and
its

 

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Subsidiaries at such time, plus (c) the current book value of Development
Properties and all land held for development; provided,  however, any land which
is not appropriately entitled or zoned to permit the use of such Property as a
self-storageself-storage facility shall only be included at 50% of book value,
plus (d) with respect to each Unconsolidated Affiliate of the Borrower, the
Borrower’s respective Ownership Share of (i) the Capitalized EBITDA of each such
Unconsolidated Affiliate and (ii) the current book values of all real property
of each such Unconsolidated Affiliate upon which construction is in progress,
plus (e) at the Borrower’s option, the purchase price paid by the Borrower or
any Subsidiary (less any amounts paid to the Borrower or such Subsidiary as a
purchase price adjustment, held in escrow, retained as a contingency reserve, or
in connection with other similar arrangements, and without regard to allocations
of property purchase prices pursuant to Statement of Financial Accounting
Standards No. 141 or other provisions of GAAP) for any Property acquired by the
Borrower or such Subsidiary during the immediately preceding four consecutive
fiscal quarters of the Borrower, plus (f) the contractual purchase price of
Properties of the Borrower and its Subsidiaries subject to purchase obligations,
repurchase obligations, forward commitments and unfunded obligations to the
extent such obligations and commitments are included in determinations of Total
Liabilities of the Borrower, plus (g) the value (determined in accordance with
GAAP) of all promissory notes payable solely to the Borrower or any of its
Subsidiaries (excluding any such note where (i) the obligor is more than 30 days
past due with respect to any payment obligation or is the subject of a
bankruptcy proceeding or other proceeding, event or condition of the types
referred to in Section 11.1.(e) or (f) or (ii) the obligor is an Affiliate of
the Borrower (other than PS Business Parks, Inc. or, PS Business Parks, L.P.,
Shurgard Europe, or a Subsidiary of Shurgard Europe so long as any such note
issued by eitherany of PS Business Parks, Inc. or, PS Business Parks, L.P.,
Shurgard Europe or a Subsidiary of Shurgard Europe matures within six months of
issuance), plus (h) the value (determined in accordance with GAAP) of all
marketable securitiesFair Market Value of all Marketable Securities owned by the
Borrower and its Subsidiaries, andplus (i) all other assets of the Borrower and
its Subsidiaries (the value of which is determined in accordance with GAAP but
excluding assets classified as intangible under GAAP).  No more than 10.0% of
the Gross Asset Value may be attributable to the aggregate of the following (x)
the current book value of land held for development and (y) the value
attributable to the assets referenced in clauses (g) and (hi) above.  For the
avoidance of doubt, the value of the Equity Interests of PS Business Parks,
Inc., PS Business Parks, L.P., any Subsidiary of PS Business Parks, Inc.,
Shurgard Europe, or any Subsidiary of Shurgard Europe owned by the Borrower and
its Subsidiaries that constitute Marketable Securities shall be determined under
clause (a) of the definition of Fair Market Value.  The Borrower shall have the
option to include EBITDA under clause (a) above from Properties that are
otherwise subject to valuation under clause (e) above; provided, however, that
if such election is made, any value attributable to such Properties under clause
(e) above shall be excluded from the determination of the amount under clause
(e).

 

“Guarantor” means any Person that is party to the Guaranty as a “Guarantor”.

“Ground Lease” means a ground lease containing terms and conditions customarily
required by mortgagees making a loan secured by the interest of the holder of
the leasehold estate demised pursuant to a ground lease, including without
limitation, the following: (a) a remaining term (exclusive of any unexercised
extension options) of 40 years or more from the Third Amendment Effective Date;
(b) the right of the lessee to mortgage and encumber its

 

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interest in the leased property, and to amend the terms of any such mortgage or
encumbrance, in each case, without the consent of the lessor; (c) the obligation
of the lessor to give the holder of any mortgage Lien on such leased property
written notice of any defaults on the part of the lessee and agreement of such
lessor that such lease will not be terminated until such holder has had a
reasonable opportunity to cure or complete foreclosures, and fails to do so;
(d) acceptable transferability of the lessee’s interest under such lease,
including ability to sublease; (e) acceptable limitations on the use of the
leased property; and (f) clearly determinable rental payment terms which in no
event contain profit participation rights.

 

“Guaranty”, “Guaranteed” or to “Guarantee” as applied to any obligation means
and includes:  (a) a guaranty (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), directly or
indirectly, in any manner, of any part or all of such obligation, or (b) an
agreement, direct or indirect, contingent or otherwise, and whether or not
constituting a guaranty, the practical effect of which is to assure the payment
or performance (or payment of damages in the event of nonperformance) of any
part or all of such obligation whether by: (i) the purchase of securities or
obligations, (ii) the purchase, sale or lease (as lessee or lessor) of property
or the purchase or sale of services primarily for the purpose of enabling the
obligor with respect to such obligation to make any payment or performance (or
payment of damages in the event of nonperformance) of or on account of any part
or all of such obligation, or to assure the owner of such obligation against
loss, (iii) the supplying of funds to or in any other manner investing in the
obligor with respect to such obligation, (iv) repayment of amounts drawn down by
beneficiaries of letters of credit (including Letters of Credit), or (v) the
supplying of funds to or investing in a Person on account of all or any part of
such Person’s obligation under a Guaranty of any obligation or indemnifying or
holding harmless, in any way, such Person against any part or all of such
obligation.  As the context requires, “Guaranty” shall also mean the guaranty
executed and delivered pursuant to Section 6.1.(a) and substantially in the form
of Exhibit B.

 

 

“Hazardous Materials” means all or any of the following: (a) substances that are
defined or listed in, or otherwise classified pursuant to, any applicable
Environmental Laws as “hazardous substances”, “hazardous materials”, “hazardous
wastes”, “toxic substances” or any other formulation intended to define, list or
classify substances by reason of deleterious properties such as ignitability,
corrosivity, reactivity, carcinogenicity, reproductive toxicity, “TCLP”
toxicity, or “EP toxicity”; (b) oil, petroleum or petroleum derived substances,
natural gas, natural gas liquids or synthetic gas and drilling fluids, produced
waters and other wastes associated with the exploration, development or
production of crude oil, natural gas or geothermal resources; (c) any flammable
substances or explosives or any radioactive materials; (d) asbestos in any form;
and (e) electrical equipment which contains any oil or dielectric fluid
containing levels of polychlorinated biphenyls in excess of fifty parts per
million.

 

“Hughes Family Member” means any of the following: (a) B. Wayne Hughes, his
spouse, his children (natural or adopted) and the children (natural or adopted)
of his children; or (b) any foundation, trust, partnership, corporation or other
Person controlled by any of the individuals referred to in clause (a).

 

 

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“Indebtedness” means, with respect to a Person, at the time of computation
thereof, all of the following (without duplication): (a) all obligations of such
Person in respect of money borrowed; (b) all obligations of such Person (other
than trade debt incurred in the ordinary course of business), whether or not for
money borrowed (i) represented by notes payable, or drafts accepted, in each
case representing extensions of credit, (ii) evidenced by bonds, debentures,
notes or similar instruments, or (iii) constituting purchase money indebtedness,
conditional sales contracts, title retention debt instruments or other similar
instruments, upon which interest charges are customarily paid or that are issued
or assumed as full or partial payment for property; (c) Capitalized Lease
Obligations of such Person; (d) all reimbursement obligations of such Person
under any letters of credit or acceptances (whether or not the same have been
presented for payment); (e) all Off Balance Sheet Liabilities of such Person;
(f) net obligations under any Derivative Contract not entered into as a hedge
against interest rate risk in respect of existing Indebtedness in an amount
equal to the Derivatives Termination Value thereof; and (g) all Indebtedness of
other Persons which (i) such Person has Guaranteed or is otherwise recourse to
such Person or (ii) is secured by a Lien on any property of such Person.

 

“Intellectual Property” has the meaning given that term in Section 7.1.(s).

 

“Interest Expense” means, with respect to a Person and for any period, (a) all
paid, accrued or capitalized interest expense (including, without limitation,
capitalized interest expense (other than capitalized interest funded from a
construction loan interest reserve account held by another lender and not
included in the calculation of cash for balance sheet reporting purposes) and
interest expense attributable to Capitalized Lease Obligations) of such Person
and in any event shall include all letter of credit fees and all interest
expense with respect to any Indebtedness in respect of which such Person is
wholly or partially liable whether pursuant to any repayment, interest carry,
performance Guarantee or otherwise, plus (b) to the extent not already included
in the foregoing clause (a) such Person’s Ownership Share of all paid, accrued
or capitalized interest expense for such period of Unconsolidated Affiliates of
such Person (other than any such interest expense paid or payable by
Unconsolidated Affiliates to such Person). 

 

“Interest Period” means:

 

(a)with respect to any LIBOR Loan, each period commencing on the date such LIBOR
Loan is made or the last day of the next preceding Interest Period for such
Loan, and ending on the numerically corresponding day in the first, second,
third or sixth calendar month thereafter, as the Borrower may select in a Notice
of Borrowing, Notice of Continuation or Notice of Conversion, as the case may
be, except that each Interest Period that commences on the last Business Day of
a calendar month (or on any day for which there is no numerically corresponding
day in the appropriate subsequent calendar month) shall end on the last Business
Day of the appropriate subsequent calendar month; and

 

(b)with respect to each Bid Rate Loan, the period commencing on the date such
Bid Rate Loan is made and ending on any Business Day not less than 7 nor more
than 180 days thereafter, as the Borrower may select as provided in
Section 2.2.(b).

 

 

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Notwithstanding the foregoing: (i) if any Interest Period for a Revolving Loan
would otherwise end after the Termination Date, such Interest Period shall end
on the Termination Date; and (ii) each Interest Period that would otherwise end
on a day which is not a Business Day shall end on the next succeeding Business
Day (or, if such next succeeding Business Day falls in the next succeeding
calendar month, on the next preceding Business Day).

 

“Interest Rate Agreement” means any interest rate swap agreement, interest rate
cap agreement, interest rate collar agreement or other similar Derivatives
Contract entered into with a nationally recognized financial institution then
having a credit rating of BBB- or higher by S&P or Baa3 or higher by Moody’s for
the purpose of protecting against fluctuations in interest rates.

 

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

 

“Investment” means, with respect to any Person, any acquisition or investment
(whether or not of a controlling interest) by such Person, whether by means of
(a) the purchase or other acquisition of any Equity Interest in another Person,
(b) a loan, advance or extension of credit to, capital contribution to, Guaranty
of Indebtedness of, or purchase or other acquisition of any Indebtedness of,
another Person, including any partnership or joint venture interest in such
other Person, or (c) the purchase or other acquisition (in one transaction or a
series of transactions) of assets of another Person that constitute the business
or a division or operating unit of another Person.  Any commitment or option to
make an Investment in any other Person shall constitute an Investment.  Except
as expressly provided otherwise, for purposes of determining compliance with any
covenant contained in a Loan Document, the amount or value of any Investment
shall be the amount actually invested, without adjustment for subsequent
increases or decreases in the value of such Investment.

 

“Investment Grade Rating” means a Credit Rating of BBB- or higher by S&P, Baa3
or higher by Moody’s, or the equivalent or higher of either such rating by
another Rating Agency.

 

“Issuing Bank” means each of Wells Fargo and Bank of America, N.A., in its
capacity as an issuer of Letters of Credit pursuant to Section 2.3., or any
successor issuer of Letters of Credit hereunder.

 

“L/C Commitment Amount”  equals an amount equal to $50,000,000 as such amount
may be reduced from time to time in accordance with the terms hereof.has the
meaning given to that term in Section 2.3.(a).

 

“Lender” means each financial institution from time to time party hereto as a
“Lender” together with its respective successors and assigns, and, as the
context requires, includes the Swingline Lender.

 

“Lending Office” means, for each Lender and for each Type of Loan, the office of
such Lender in such Lender’s Administrative Questionnaire or in the applicable
Assignment and Acceptance Agreement, or such other office of such Lender as such
Lender may notify the Agent in writing from time to time.

 

 

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“Letter of Credit” has the meaning given that term in Section 2.3.(a).

 

“Letter of Credit Collateral Account” means a special interest bearing deposit
account maintained by the Agent for the benefit of the Agent, the Issuing Banks
and the Lenders and under itsthe sole dominion and control of the Agent.

 

“Letter of Credit Documents” means, with respect to any Letter of Credit,
collectively, any application therefor, any certificate or other document
presented in connection with a drawing under such Letter of Credit and any other
agreement, instrument or other document governing or providing for (a) the
rights and obligations of the parties concerned or at risk with respect to such
Letter of Credit or (b) any collateral security for any of such obligations.

 

“Letter of Credit Liabilities” means, without duplication, at any time and in
respect of any Letter of Credit, the sum of (a) the Stated Amount of such Letter
of Credit plus (b) the aggregate unpaid principal amount of all Reimbursement
Obligations of the Borrower at such time due and payable in respect of all
drawings made under such Letter of Credit.  For purposes of this Agreement, a
Lender (other than the Agenta Lender in its capacity as suchan Issuing Bank of a
Letter of Credit) shall be deemed to hold a Letter of Credit Liability in an
amount equal to its participation interest under Section 2.3.(i) in the related
Letter of Credit, and the AgentLender that is the Issuing Bank of such Letter of
Credit shall be deemed to hold a Letter of Credit Liability in an amount equal
to its retained interest in the relatedsuch Letter of Credit after giving effect
to the acquisition by the Lenders (other than the AgentLender that is the
Issuing Bank of such Letter of Credit) of their participation interests under
such Section.

 

“LIBOR” means, with respect to any LIBOR Loan for any Interest Period, the rate
of interest obtained by dividing (i) the rate appearing on theof interest per
annum determined on the basis of the rate for deposits in Dollars for a period
equal to the applicable Interest Period which appears on Reuters Screen LIBOR01
page (or on any successor or substitute page of such service, or any successor
to or substitute for such service, providing rate quotations comparable to those
currently provided on such page, as determined by the Administrative Agent from
time to time for purposes of providing quotations of interest ratesPage (or any
applicable to Dollar deposits in the London interbank marketsuccessor page) at
approximately 11:00 a.m., (London time, on the date that is) two Business Days
prior to the first day of such Interest Period and having a maturity equal to
suchthe applicable Interest Period by (ii) a percentage equal to 1 minus the
stated maximum rate (stated as a decimal) of all reserves, if any, required to
be maintained with respect to Eurocurrency funding (currently referred to as
“Eurocurrency liabilities”) as specified in Regulation D of the Board of
Governors of the Federal Reserve System (or against any other category of
liabilities which includes deposits by reference to which the interest rate on
LIBOR Loans is determined or any applicable category of extensions of credit or
other assets which includes loans by an office of any Lender outside of the
United States of America).  If, for any reason, the rate referred to in the
preceding clause (i) does not appear on Reuters Screen LIBOR01 Page (or any
applicable successor page), then the rate to be used for such clause (i) shall
be determined by the Agent to be the arithmetic average of the rate per annum at
which deposits in Dollars would be offered by first class banks in the London
interbank market to the Agent at approximately 11:00 a.m. (London time) two
Business Days prior to the first day of the applicable Interest Period for a
period equal to such Interest Period.    

 

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Any change in suchthe maximum rate or reserves described in the preceding
clause (ii) shall result in a change in LIBOR on the date on which such change
in such maximum rate becomes effective.  If LIBOR determined as provided above
would be less than zero, LIBOR shall be deemed to be zero.

 

“LIBOR Auction” means a solicitation of Bid Rate Quotes setting forth LIBOR
Margin Loans based on LIBOR pursuant to Section 2.2.

 

“LIBOR Loan” means a Revolving Loan bearing interest at a rate based on LIBOR.

 

“LIBOR Margin” has the meaning given that term in Section 2.2.(c)(ii)(D).

 

“LIBOR Margin Loan” means a Bid Rate Loan the interest rate on which is
determined on the basis of LIBOR pursuant to a LIBOR Auction.

 

“LIBOR Market Index Rate” means, for any day, LIBOR as of that day for one-month
deposits in Dollars at approximately 9:00 a.m. Pacific time for such day (or if
such day is not a business day, the immediately preceding business day).  The
LIBOR Market Index Rate shall be determined on a daily basis.

 

“Lien” as applied to the property of any Person means:  (a) any security
interest, encumbrance, mortgage, deed to secure debt, deed of trust, pledge,
lien, charge or lease constituting a Capitalized Lease Obligation, conditional
sale or other title retention agreement, or other security title or encumbrance
of any kind in respect of any property of such Person, or upon the income or
profits therefrom; (b) any arrangement, express or implied, under which any
property of such Person is transferred, sequestered or otherwise identified for
the purpose of subjecting the same to the payment of Indebtedness or performance
of any other obligation in priority to the payment of the general, unsecured
creditors of such Person; (c) the filing of any financing statement under the
UCC or its equivalent in any jurisdiction; and (d) any agreement by such Person
to grant, give or otherwise convey any of the foregoing.

 

“Loan” means a Revolving Loan, a Bid Rate Loan or a Swingline Loan.

 

“Loan Document” means this Agreement, each Note, each Letter of Credit Document
and each other document or instrument now or hereafter executed and delivered by
a Loan Party in connection with, pursuant to or relating to this Agreement.

 

“Loan Party” means each of the Borrower, each other Person who guarantees all or
a portion of the Obligations and/or who pledges any collateral to secure all or
a portion of the Obligations.  Schedule 1.1. sets forth the Loan Parties in
addition to the Borrower as of the Agreement Date.

 

“Marketable Securities” means: (a) common or preferred Equity Interests of
Persons located in, and formed under the laws of, any State of the United States
or America or the District of Columbia, which Equity Interests are subject to
price quotations (quoted at least daily) on The NASDAQ Stock Market’s National
Market System or have trading privileges on the New

 

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York Stock Exchange, the American Stock Exchange or another recognized national
United States securities exchange, the London Stock Exchange, Euronext or
another recognized European securities exchange; (b) convertible securities
which can be converted at any time into common or preferred Equity Interests of
the type described in the immediately preceding clause (a); and (c) securities
evidencing Indebtedness issued by Persons located in, and formed under the laws
of, any State of the United States or America or the District of Columbia, which
Persons have a Credit Rating of BBB- or Baa3 or better.

 

“Material Adverse Effect” means a materially adverse effect on (a) the business,
assets, liabilities, financial condition, or results of operations or business
prospects of the Borrower and its Subsidiaries taken as a whole, (b) the ability
of the Borrower or any other Loan Party to perform its obligations under any
Loan Document to which it is a party, (c) the validity or enforceability of any
of the Loan Documents, (d) the rights and remedies of the Lenders, the Issuing
Banks and the Agent under any of the Loan Documents or (e) the timely payment of
the principal of or interest on the Loans or other amounts payable in connection
therewith.

 

“Material Contract” means any contract or other arrangement (other than Loan
Documents), whether written or oral, to which the Borrower, any Subsidiary or
any other Loan Party is a party as to which the breach, nonperformance,
cancellation or failure to renew by any party thereto could have a Material
Adverse Effect.

 

“Material Plan” means at any time a Plan or Plans having aggregate Unfunded
Liabilities in excess of $2,500,000.

 

“Material Subsidiary” means any Subsidiary to which $200,000,000500,000,000 or
more of Gross Asset Value is attributable on an individual basis.

 

“Moody’s” means Moody’s Investors Service, Inc.

 

“Mortgage” means a mortgage, deed of trust, deed to secure debt or similar
security instrument made by a Person owning an interest in real property
granting a Lien on such interest in real property as security for the payment of
Indebtedness of such Person.

 

“Multiemployer Plan” means at any time an employee pension benefit plan within
the meaning of Section 4001(a)(3) of ERISA to which any member of the ERISA
Group is then making or accruing an obligation to make contributions or has
within the preceding five plan years made contributions, including for these
purposes any Person which ceased to be a member of the ERISA Group during such
five year period.

 

“Negative Pledge” means, with respect to a given asset, any provision of a
document, instrument or agreement (other than any Loan Document) which prohibits
or purports to prohibit the creation of any Lien on such asset as security for
Indebtedness of the Person owning such asset or any other Person.

 

“Net Operating Income” means, for any Property and for a given period, the sum
(without duplication) of (a) rents and other revenues earned in the ordinary
course from such

 

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Property (excluding pre-paid rents and revenues and security deposits except to
the extent applied in satisfaction of tenants’ obligations for rent) minus
(b) all expenses paid or accrued related to the ownership, operation or
maintenance of such Property, including but not limited to, taxes, assessments
and the like, insurance, utilities, payroll costs, maintenance, repair and
landscaping expenses, marketing expenses, and general and administrative
expenses (including an appropriate allocation for legal, accounting,
advertising, marketing and other expenses incurred in connection with such
Property, but specifically excluding general overhead expenses of the Borrower
and its Subsidiaries and any property management fees) minus (c) the Reserve for
Replacements for such Property for such period minus (d) the actual property
management fee, if any, paid during such period with respect to such Property.

 

“Net Proceeds” means with respect to an Equity Issuance by a Person, the
aggregate amount of all cash or the Fair Market Value of all other property
received by such Person in respect of such Equity Issuance net of investment
banking fees, legal fees, accountants fees, underwriting discounts and
commissions and other customary fees and expenses actually incurred by such
Person in connection with such Equity Issuance.

 

“New Guarantor” has the meaning given that term in Section 8.14.

“Non-Domestic Property” means a Property located outside a state of the United
States of America or the District of Columbia.

 

“Non-Guarantor Entity” means: (a) any Subsidiary that is not required to become
a party to the Guaranty under Section 8.14.(a) or that has not become a party to
the Guaranty under Section 8.14.(b); (b) any Unconsolidated Affiliate of the
Borrower; and (c) any other Affiliate of the Borrower in which the Borrower
holds an Investment. 

 

“Nonrecourse Indebtedness” means, with respect to a Person, Indebtedness for
borrowed money in respect of which recourse for payment (except for customary
exceptions for fraud, misapplication of funds, environmental indemnities,
voluntary bankruptcy, collusive involuntary bankruptcy and other similar
customary exceptions to recoursenonrecourse liability in a form reasonably
acceptable to the Agent) is contractually limited to specific assets of such
Person encumbered by a Lien securing such Indebtedness.

 

“Note” means a Revolving Note, a Bid Rate Note or the Swingline Note.

 

“Notice of Borrowing” means a notice in the form of Exhibit C to be delivered to
the Agent pursuant to Section 2.1.(b) evidencing the Borrower’s request for a
borrowing of Revolving Loans.

 

“Notice of Continuation” means a notice in the form of Exhibit D to be delivered
to the Agent pursuant to Section 2.10. evidencing the Borrower’s request for the
Continuation of a LIBOR Loan.

 

“Notice of Conversion” means a notice in the form of Exhibit E to be delivered
to the Agent pursuant to Section 2.11. evidencing the Borrower’s request for the
Conversion of a Revolving Loan from one Type to another Type.

 

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“Notice of Swingline Borrowing” means a notice substantially in the form of
Exhibit F to be delivered to the Swingline Lender pursuant to Section 2.4.(b)
evidencing the Borrower’s request for a Swingline Loan.

 

“Obligations” means, individually and collectively: (a) the aggregate principal
balance of, and all accrued and unpaid interest on, all Loans; (b) all
Reimbursement Obligations and all other Letter of Credit Liabilities; and
(c) all other indebtedness, liabilities, obligations, covenants and duties of
the Borrower or any of the other Loan Parties owing to the Agent, any Issuing
Bank or any Lender of every kind, nature and description, under or in respect of
this Agreement or any of the other Loan Documents, including, without
limitation, the Fees and indemnification obligations, whether direct or
indirect, absolute or contingent, due or not due, contractual or tortious,
liquidated or unliquidated, and whether or not evidenced by any promissory note.

 

“Occupancy Rate” means, with respect to a Property at any time, the ratio,
expressed as a percentage, of (a) the net rentable square footage of such
Property actually occupied by tenants paying rent pursuant to binding leases as
to which no default exists to (b) the aggregate net rentable square footage of
such Property.

 

“Off Balance Sheet Liabilities” means, with respect to any Person, (a) any
repurchase obligation or liability, contingent or otherwise, of such Person with
respect to any accounts or notes receivable sold, transferred or otherwise
disposed of by such Person, (b) any repurchase obligation or liability,
contingent or otherwise, of such Person with respect to property or assets
leased by such Person as lessee and (c) all obligations, contingent or
otherwise, of such Person under any synthetic lease, tax retention operating
lease, off balance sheet loan or similar off balance sheet financing if the
transaction giving rise to such obligation (i) is considered indebtedness for
borrowed money for tax purposes but is classified as an operating lease or
(ii) does not (and is not required to pursuant to GAAP) appear as a liability on
the balance sheet of such Person.

 

“Ownership Share” means, with respect to any Subsidiary of a Person (other than
a Wholly Owned Subsidiary) or any Unconsolidated Affiliate of a Person, the
greater of (a) such Person’s relative nominal direct and indirect ownership
interest (expressed as a percentage) in such Subsidiary or Unconsolidated
Affiliate or (b) subject to compliance with Section 9.4.(l), such Person’s
relative direct and indirect economic interest (calculated as a percentage) in
such Subsidiary or Unconsolidated Affiliate determined in accordance with the
applicable provisions of the declaration of trust, articles or certificate of
incorporation, articles of organization, partnership agreement, joint venture
agreement or other applicable organizational document of such Subsidiary or
Unconsolidated Affiliate. 

 

“Participant” has the meaning given that term in Section 13.5. (c).

 

“Participant Register” has the meaning given that term in Section 13.5. (c).

 

“PBGC” means the Pension Benefit Guaranty Corporation and any successor agency.

 

 

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“Permitted Liens” means, with respect to any asset or property of a Person,
(a) Liens securing taxes, assessments and other charges or levies imposed by any
Governmental Authority (excluding any Lien imposed pursuant to any of the
provisions of ERISA or pursuant to any Environmental Laws) or the claims of
materialmen, mechanics, carriers, warehousemen or landlords for labor,
materials, supplies or rentals incurred in the ordinary course of business,
which are not at the time required to be paid or discharged under Section 8.6.;
(b) Liens consisting of deposits or pledges made, in the ordinary course of
business, in connection with, or to secure payment of, obligations under
workmen’s compensation, unemployment insurance or similar Applicable Laws;
(c) Liens consisting of encumbrances in the nature of zoning restrictions,
easements, and rights or restrictions of record on the use of real property,
which do not materially detract from the value of such property or impair the
use thereof in the business of such Person; and (d) the rights of tenants under
leases or subleases not interfering with the ordinary conduct of business of
such Person and (e) Liens in favor of the Agent for the benefit of the Issuing
Banks and the Lenders.

 

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

 

“Plan” means at any time an employee pension benefit plan (other than a
Multiemployer Plan) which is covered by Title IV of ERISA or subject to the
minimum funding standards under Section 412 of the Internal Revenue Code and
either (i) is maintained, or contributed to, by any member of the ERISA Group
for employees of any member of the ERISA Group or (ii) has at any time within
the preceding five years been maintained, or contributed to, by any Person which
was at such time a member of the ERISA Group for employees of any Person which
was at such time a member of the ERISA Group.

 

“Post‑Default Rate” means, in respect of any principal of any Loan or any other
Obligation, a rate per annum equal to four percent (4.0%) plus the Base Rate as
in effect from time to time plus the Applicable Margin.

 

“Preferred Stock” means, with respect to any Person, shares of capital stock of,
or other equity interests in, such Person which are entitled to preference or
priority over any other capital stock of, or other equity interest in, such
Person in respect of the payment of dividends or distributions, or distribution
of assets upon liquidation or both.

 

“Property” means a parcel (or group of related parcels) of real property
developed (or to be developed) for use as storage facility either as a
mini-warehouse or combination mini-warehouse and central warehouse for container
storage.

 

“Rating Agency” means S&P, Moody’s or Fitch, Inc.  Other nationally recognized
securities rating agencies selected by the Borrower shall be “Rating Agencies”
only upon written approval by the Agent.

 

“Recourse Indebtedness” means, with respect to a Person, all Indebtedness of
such Person that is not Nonrecourse Indebtedness.

 

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“Recurring Capital Expenditures” means capital expenditures made in respect of a
Property for maintenance of such Property and replacement of items due to
ordinary wear and tear including, but not limited to, expenditures made for
maintenance or replacement of carpeting, roofing materials, mechanical systems,
electrical systems and other structural systems and expenditures relating to
tenant improvements and leasing commissions.  “Recurring Capital Expenditures”
shall not include any of the following: (a) improvements to the appearance of
such Property or any other major upgrade or renovation of such Property not
necessary for proper maintenance or marketability of such Property; (b) capital
expenditures for seismic upgrades; or (c) capital expenditures for deferred
maintenance for such Property existing at the time such Property was acquired by
the Borrower or a Subsidiary.

 

“Register” has the meaning given that term in Section 13.5.(e).

 

“Regulatory Change” means, with respect to any Lender, any change effective
after the Agreement Date in Applicable Law (including without limitation,
Regulation D of the Board of Governors of the Federal Reserve System) or the
adoption or making after such date of any interpretation, directive or request
applying to a class of banks, including such Lender, of or under any Applicable
Law (whether or not having the force of law and whether or not failure to comply
therewith would be unlawful) by any Governmental Authority or monetary authority
charged with the interpretation or administration thereof or compliance by any
Lender with any request or directive regarding capital
adequacy.  Notwithstanding anything herein to the contrary: (a) the Dodd-Frank
Wall Street Reform and Consumer Protection Act and all requests, rules,
guidelines or directives thereunder or issued in connection therewith and
(b) all requests, rules, guidelines or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor or similar authority) or the United States or foreign regulatory
authorities, in each case pursuant to Basel III, shall in each case be deemed to
be a “Regulatory Change”, regardless of the date enacted, adopted or issued.

 

“Reimbursement Obligation” means the absolute, unconditional and irrevocable
obligation of the Borrower to reimburse the Agentan Issuing Bank for any drawing
honored by the Agentsuch Issuing Bank under a Letter of Credit.

 

“REIT” means a Person qualifying for treatment as a “real estate investment
trust” under the Internal Revenue Code.

 

“Requisite Lenders” means, as of any date, Lenders (which must include the
Lender then acting as Agent) whose combined Commitment Percentages equal or
exceed 51%, provided that (a) in determining such percentage at any given time,
all then existing Defaulting Lenders will be disregarded and excluded and (b) at
all times when two or more Lenders (excluding Defaulting Lenders) are party to
this Agreement, the term “Requisite Lenders” shall in no event mean less than
two Lenders.

 

“Reserve for Replacements” means, for any period and with respect to any
Property, an amount equal to (a) the aggregate net rentable square footage of
all completed space of such Property times (b) $0.35 times (c) the number of
days such Property was operated in such period

 

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divided by (d) 365.  If the term Reserve for Replacements is used without
reference to any specific Property, then it shall be determined on an aggregate
basis with respect to all Properties and a proportionate share of all real
propertythe applicable Ownership Shares with respect to all Properties of all
Unconsolidated Affiliates.

 

“Restricted Payment” means: (a) any dividend or other distribution, direct or
indirect, on account of any shares of any class of stock or other equity
interest of the Borrower or any of its Subsidiaries now or hereafter
outstanding, except a dividend payable solely in shares of that class of stock
to the holders of that class; (b) any redemption, conversion, exchange,
retirement, sinking fund or similar payment, purchase or other acquisition for
value, direct or indirect, of any shares of any class of stock or other equity
interest of the Borrower or any of its Subsidiaries now or hereafter
outstanding; (c) any payment or prepayment of principal of, premium, if any, or
interest on, redemption, conversion, exchange, purchase, retirement, defeasance,
sinking fund or similar payment with respect to, any Subordinated Debt; and (d)
any payment made to retire, or to obtain the surrender of, any outstanding
warrants, options or other rights to acquire shares of any class of stock of the
Borrower or any of its Subsidiaries now or hereafter outstanding.

 

“Revolving Credit Exposure” means, as to any Lender at any time, the aggregate
principal amount at such time of its outstanding Revolving Loans and such
Lender’s participation in Letter of Credit Liabilities and Swingline Loans at
such time.

 

“Revolving Loan” means a loan made by a Lender to the Borrower pursuant to
Section 2.1.(a).

 

“Revolving Note” has the meaning given that term in Section 2.12.

 

“Second Amendment Effective Date” means July 17, 2013.

“SEC” means the Securities and Exchange Commission, or any Governmental
Authority succeeding to any of its principal functions.

 

“Secured Indebtedness” means, with respect to any Person, (a) all Indebtedness
of such Person that is secured in any manner by any Lien on any property plus
(b) such Person’s Ownership Share of the Secured Indebtedness of any of such
Person’s Unconsolidated Affiliates.

 

“Securities Act” means the Securities Act of 1933, as amended from time to time,
together with all rules and regulations issued thereunder.

 

“Shurgard Europe” means Shurgard European Holdings LLC.

 

“Solvent” means, when used with respect to any Person, that (a) the fair value
and the fair salable value of its assets (excluding any Indebtedness due from
any affiliate of such Person) are each in excess of the fair valuation of its
total liabilities (including all contingent liabilities); (b) such Person is
able to pay its debts or other obligations in the ordinary course as they
mature; and (c) such Person has capital not unreasonably small to carry on its
business and all business in which it proposes to be engaged.

 

 

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“S&P” means Standard & Poor’s RatingRatings Services, a division of The
McGraw-Hill Companies, IncStandard & Poor’s Financial Services LLC business, or
any successor.

 

“Stated Amount” means the amount available to be drawn by a beneficiary under a
Letter of Credit from time to time, as such amount may be increased or reduced
from time to time in accordance with the terms of such Letter of Credit.

 

“Subordinated Debt” means Indebtedness for money borrowed of the Borrower or any
of its Subsidiaries that is subordinated in right of payment and otherwise to
the Loans and the other Obligations in a manner satisfactory to the Agent in its
sole and absolute discretion.

 

“Subsidiary” means, for any Person, any corporation, partnership, limited
liability company or other entity of which at least a majority of the securities
or other ownership interests having by the terms thereof ordinary voting power
to elect a majority of the Board of DirectorsTrustees or other persons
performing similar functions of such corporation, partnership, limited liability
company or other entity (without regard to the occurrence of any contingency) is
at the time directly or indirectly owned or controlled by such Person or one or
more Subsidiaries of such Person or by such Person and one or more Subsidiaries
of such Person.

 

“Substantial Amount” means, at the time of determination thereof, an amount in
excess of 10.0% of total assets (exclusive of depreciation) at such time of the
Borrower and its Subsidiaries determined on a consolidated basis.

 

“Swingline Commitment” means the Swingline Lender’s obligation to make Swingline
Loans pursuant to Section 2.4. in an amount up to, but not exceeding,
$75,000,000, as such amount may be reduced from time to time in accordance with
the terms hereof.

 

“Swingline Lender” means Wells Fargo Bank, National Association, together with
its respective successors and assigns.

 

“Swingline Loan” means a loan made by the Swingline Lender to the Borrower
pursuant to Section 2.4.(a).

 

“Swingline Note” means a promissory note of the Borrower substantially in the
form of Exhibit G, payable to the order of the Swingline Lender in a principal
amount equal to the amount of the Swingline Commitment as originally in effect
and otherwise duly completed.

 

“Swingline Termination Date” means the date which is 7 Business Days prior to
the Termination Date.

 

“Taxes” has the meaning given that term in Section 3.11.

 

“Termination Date” means March 2131,  20172020. 

“Third Amendment Effective Date” means March 31, 2015.

 

 

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“Total Budgeted Cost” means, with respect to a Development Property, and at any
time, the aggregate amount of all costs budgeted to be paid, incurred or
otherwise expended or accrued by the Borrower, a Subsidiary or an Unconsolidated
Affiliate with respect to such Property to achieve an Occupancy Rate such that
the Property is achieving breakeven or positive operating cash flow, including
without limitation, all amounts budgeted with respect to all of the
following:  (a) acquisition of land and any related improvements; (b) a
reasonable and appropriate reserve for construction interest; (c) a reasonable
and appropriate operating deficit reserve; (d) tenant improvements; (e) leasing
commissions; and (f) other hard and soft costs associated with the development
or redevelopment of such Property.  With respect to any Property to be developed
in more than one phase, the Total Budgeted Cost shall exclude budgeted costs
(other than costs relating to acquisition of land and related improvements) to
the extent relating to any phase for which (i) construction has not yet
commenced and (ii) a binding construction contract has not been entered into by
the Borrower, any Subsidiary or any Unconsolidated Affiliate, as the case may
be.

 

“Total Indebtedness” means, without duplication, (a) Total Liabilities of the
Borrower and its Subsidiaries on a consolidated basis minus (b) (i) all accounts
payable and accrued expenses of the Borrower and its Subsidiaries and
(ii) obligations in respect of preferred partnership units or other preferred
Equity Interest issued by any Subsidiary (excluding obligations in respect of
any such preferred Equity Interests beneficially owned by the Borrower or any
Subsidiary).

 

“Total Liabilities” means, as to any Person as of a given date, all liabilities
which would, in conformity with GAAP, be properly classified as a liability on
the balance sheet of such Person as of such date, and in any event shall include
(without duplication): (a) all Indebtedness of such Person (whether or not
Nonrecourse Indebtedness and whether or not secured by a Lien), including
without limitation, Capitalized Lease Obligations; (b) all accounts payable and
accrued expenses of such Person; (c) all purchase and repurchase obligations and
forward commitments of such Person to the extent such obligations or commitments
are evidenced by a binding purchase agreement (forward commitments shall include
without limitation (i) forward equity commitments and (ii) commitments to
purchase any real property under development, redevelopment or renovation);
(d) all unfunded obligations of such Person; (e) all lease obligations of such
Person (including ground leases) to the extent required under GAAP to be
classified as a liability on the balance sheet of such Person; (f) all
contingent obligations of such Person including, without limitation, all
Guarantees of Indebtedness by such Person; (g) all liabilities of any
Unconsolidated Affiliate of such Person, which liabilities such Person has
Guaranteed or is otherwise obligated on a recourse basis; (h) such Person’s
Ownership Share of the Indebtedness of any Unconsolidated Affiliate of such
Person, including Nonrecourse Indebtedness of such Person (but excluding
Indebtedness of such Unconsolidated Affiliate owing to such Person); and (i) in
the case of the Borrower, obligations in respect of preferred partnership units
or other preferred Equity Interest issued by any Subsidiary (excluding
obligations in respect of any such preferred Equity Interests beneficially owned
by the Borrower or any Subsidiary).  For purposes of clauses (c) and (d) of this
definition, the amount of Total Liabilities of a Person at any given time in
respect of (x) a contract to purchase or otherwise acquire unimproved or
developed real property shall be equal to the total purchase price payable by
such Person under the contract if, at such time, the seller of such real
property would be

 

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entitled to specifically enforce the contract against such Person, and (y) a
contract relating to the acquisition of real property which the seller is
required to develop or renovate prior to, and as a condition precedent to, such
acquisition, shall equal the maximum amount reasonably estimated to be payable
by such Person under the contract assuming performance by the seller of its
obligations under the contract, which amount shall include, without limitation,
any amounts payable after consummation of such acquisition which may be based on
certain performance levels or other related criteria. 

 

“Type” with respect to any Revolving Loan, refers to whether such Loan is a
LIBOR Loan or a Base Rate Loan.

 

“UCC” means the Uniform Commercial Code as in effect in any applicable
jurisdiction.

 

“Unconsolidated Affiliate” shall mean, with respect to any Person, any other
Person (other than PS Business Parks, Inc., PS Business Parks L.P., Subsidiaries
of PS Business Parks, Inc., Shurgard Europe and Subsidiaries of Shurgard Europe)
in whom such Person holds an Investment, which Investment is accounted for in
the financial statements of such Person on an equity basis of accounting and
whose financial results would not be consolidated under GAAP with the financial
results of such Person on the consolidated financial statements of such Person.

 

“Unencumbered Asset” means a promissory note or a Marketable Security which
satisfies all of the following requirements: (a) such property is wholly owned
by the Borrower or a Wholly Owned Subsidiary provided, that if a Subsidiary does
not meet the definition of “Wholly Owned Subsidiary” solely because such
Subsidiary has issued partnership interests that are or will be convertible at
the option of the holder of such partnership interest into the Equity Interests
or Preferred Stock of the Borrower, such Subsidiary shall be considered a
“Wholly Owned Subsidiary” for purposes of this clause (a); and (b) neither such
property, nor if such asset is owned by a Subsidiary, any of the Borrower’s
direct or indirect ownership interest in such Subsidiary, is subject to (i) any
Lien other than Permitted Liens of the types described in clauses (a), (b), and
(e) of the definition thereof or (ii) any Negative Pledge.

 

“Unencumbered Asset Value” means, at a given time, the sum (without duplication)
of (a) Capitalized Unencumbered NOI, excluding Capitalized Unencumbered NOI
attributable to Properties acquired by the Borrower or such Subsidiary during
the immediately preceding four consecutive fiscal quarters of the Borrower and
Development Properties, plus (b) all cash and cash equivalents (excluding tenant
deposits and other cash and cash equivalents the disposition of which is
restricted) of the Borrower or any Wholly Owned Subsidiary so long as such cash
and cash equivalents are not subject to any Liens (other than Permitted Liens of
the types described in clauses (a), (b), and (e) of the definition thereof) or
to any Negative Pledge, plus (c) the current book value of Development
Properties  and all land held for development that, in each case, constitute
Eligible Properties; provided, however, any land which is not appropriately
entitled or zoned to permit the use of such Property as a self-storage facility
shall only be included at 50% of book value, plus (d) at the Borrower’s option,
the purchase price paid by the Borrower or any Subsidiary (less any amounts paid
to the Borrower or such Subsidiary as a purchase price adjustment, held in
escrow, retained as a contingency reserve, or in connection with other similar
arrangements, and without regard to allocations of property purchase prices

 

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pursuant to Statement of Financial Accounting Standards No. 141 or other
provisions of GAAP) for any Eligible Property acquired by the Borrower or such
Subsidiary during the immediately preceding four consecutive fiscal quarters of
the Borrower, plus (e) the contractual purchase price of Eligible Properties of
the Borrower and its Subsidiaries subject to purchase obligations, repurchase
obligations, forward commitments and unfunded obligations to the extent such
obligations and commitments are included in determinations of  Unsecured
Indebtedness of the Borrower and its Subsidiaries, plus (f) the value
(determined in accordance with GAAP) of all promissory notes that are also
Unencumbered Assets and payable solely to the Borrower or any of its Wholly
Owned Subsidiaries (excluding any such note where (i) the obligor is more than
30 days past due with respect to any payment obligation or is the subject of a
bankruptcy proceeding or other proceeding, event or condition of the types
referred to in Section 11.1.(e) or (f) or (ii) the obligor is an Affiliate of
the Borrower (other than PS Business Parks, Inc., PS Business Parks, L.P.,
Shurgard Europe or a Subsidiary of Shurgard Europe, so long as any such note
issued by any of PS Business Parks, Inc., PS Business Parks, L.P., Shurgard
Europe or a Subsidiary of Shurgard Europe matures within six months of
issuance), plus (g) the Fair Market Value of all Marketable Securities that are
also Unencumbered Assets.  To the extent that the amount of Unencumbered Asset
Value attributable to Properties leased pursuant to Ground Leases would
constitute more than 10.0% of Unencumbered Asset Value, such excess shall be
excluded.  To the extent that the amount of Unencumbered Asset Value
attributable to Non-Domestic Properties would constitute more than 10.0% of
Unencumbered Asset Value, such excess shall be excluded.  To the extent that the
amount of Unencumbered Asset Value attributable to (x) the current book value of
land held for development and (y) the value attributable to the assets
referenced in clause (f) above, would exceed 10.0% of Unencumbered Asset Value,
such excess shall be excluded.  For the avoidance of doubt, the value of the
Equity Interests of PS Business Parks, Inc., PS Business Parks, L.P., any
Subsidiary of PS Business Parks, Inc., Shurgard Europe, or any Subsidiary of
Shurgard Europe owned by the Borrower and its Subsidiaries that constitute
Marketable Securities shall be determined under clause (a) of the definition of
Fair Market Value.  The Borrower shall have the option to include NOI under
clause (a) above from Properties that are otherwise subject to valuation under
clause (d) above; provided, however, that if such election is made, any value
attributable to such Properties under clause (d ) above shall be excluded from
the determination of the amount under clause (d). Further, no Property or any of
the other assets described in clauses (a) through (g) owned or held (or in the
case of any Eligible Property subject to a Ground Lease, leased) by a Subsidiary
shall be included in the calculation of Unencumbered Asset Value, if such
Subsidiary has incurred, acquired or suffered to exist any Recourse
Indebtedness. 

 

“Unencumbered NOI” means, for any period, the aggregate Net Operating Income for
such period of all Eligible Properties.

 

“Unfunded Liabilities” means, with respect to any Plan at any time, the amount
(if any) by which (a) the value of all benefit liabilities under such Plan,
determined on a plan termination basis using the assumptions prescribed by the
PBGC for purposes of Section 4044 of ERISA, exceeds (b) the fair market value of
all Plan assets allocable to such liabilities under Title IV of ERISA (excluding
any accrued but unpaid contributions), all determined as of the then most recent
valuation date for such Plan, but only to the extent that such excess represents
a potential

 

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liability of a member of the ERISA Group to the PBGC or any other Person under
Title IV of ERISA.

 

“Unsecured LiabilitiesIndebtedness” means, aswith respect to any Person as of a
given date, the sum of the following (without duplication): (a) all liabilities
which would, in conformity with GAAP, be properly classified as a liability on
the balance sheet of such Person as at such date; plus (b) all Indebtedness of
such Person;  minus (c) all that is not Secured Indebtedness of such Person;
provided, however, that any Indebtedness that is secured only by a pledge of
Equity Interests shall be deemed to be Unsecured Indebtedness.

 

“Wells Fargo” means Wells Fargo Bank, National Association, and its successors
and permitted assigns.

 

“Wholly Owned Subsidiary” means any Subsidiary of a Person which all of the
equity securities or other ownership interests (other than, in the case of a
corporation, directors’ qualifying shares or, in the case of a trust, trustees’
qualifying shares) are at the time directly or indirectly owned or controlled by
such Person or one or more other Subsidiaries of such Person or by such Person
and one or more other Subsidiaries of such Person. In the case of the Borrower,
the term “Wholly Owned Subsidiary” shall also include any Subsidiary of the
Borrower (a) of which the Borrower owns or controls, directly, or indirectly
through one or more other Subsidiaries, at least 95% of the equity securities or
other ownership interests of such Subsidiary and (b) the remaining the equity
securities or other ownership interests of such Subsidiary are owned by Hughes
Family Members.

 

Section 1.2.  General; References to San Francisco Time.

Unless otherwise indicated, all accounting terms, ratios and measurements shall
be interpreted or determined in accordance with GAAP in effect as of the
Agreement Date. References in this Agreement to “Sections”, “Articles”,
“Exhibits” and “Schedules” are to sections, articles, exhibits and schedules
herein and hereto unless otherwise indicated.  references in this Agreement to
any document, instrument or agreement (a) shall include all exhibits, schedules
and other attachments thereto, (b) shall include all documents, instruments or
agreements issued or executed in replacement thereof, to the extent permitted
hereby and (c) shall mean such document, instrument or agreement, or replacement
or predecessor thereto, as amended, supplemented, restated or otherwise modified
from time to time to the extent permitted hereby and in effect at any given
time.  Wherever from the context it appears appropriate, each term stated in
either the singular or plural shall include the singular and plural, and
pronouns stated in the masculine, feminine or neuter gender shall include the
masculine, the feminine and the neuter.  Unless explicitly set forth to the
contrary, a reference to “Subsidiary” means a Subsidiary of the Borrower or a
Subsidiary of such Subsidiary and a reference to an “Affiliate” means a
reference to an Affiliate of the Borrower.  Titles and captions of Articles,
Sections, subsections and clauses in this Agreement are for convenience only,
and neither limit nor amplify the provisions of this Agreement.  Unless
otherwise indicated, all references to time are references to San Francisco,
California time.

 

 

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Article II. Credit Facilities

Section 2.1.  Revolving Loans.

(a)Generally.  Subject to the terms and conditions hereof, including without
limitation, Section 2.18., during the period from the Effective Date to but
excluding the Termination Date, each Lender severally and not jointly agrees to
make Revolving Loans in Dollars to the Borrower in an aggregate principal amount
at any one time outstanding up to, but not to exceed, the amount of such
Lender’s Commitment.  Subject to the terms and conditions of this Agreement,
during the period from the Effective Date to but excluding the Termination Date,
the Borrower may borrow, repay and reborrow Revolving Loans hereunder. 

 

(b)Requesting Revolving Loans.  The Borrower shall give the Agent notice
pursuant to a Notice of Borrowing of each borrowing of Revolving Loans.  Each
Notice of Borrowing shall be delivered to the Agent before 10:00 a.m. (i) in the
case of LIBOR Loans on the date three Business Days prior to the proposed date
of such borrowing and (ii) in the case of Base Rate Loans, on the date one
Business Day prior to the proposed date of such borrowing. The Agent will
transmit by telecopy, electronic mail or other form of transmission the Notice
of Borrowing (or the information contained in such Notice of Borrowing) to each
Lender promptly upon receipt by the Agent.  Each Notice of Borrowing shall be
irrevocable once given and binding on the Borrower. 

 

(c)Disbursements of Revolving Loan Proceeds.  No later than 10:00 a.m. on the
date specified in the Notice of Borrowing, each Lender will make available for
the account of its applicable Lending Office to the Agent, in immediately
available funds, the proceeds of the Revolving Loan to be made by such
Lender.  With respect to Revolving Loans to be made after the Effective Date,
unless the Agent shall have been notified by any Lender prior to the specified
date of borrowing that such Lender does not intend to make available to the
Agent the Revolving Loan to be made by such Lender on such date, the Agent may
assume that such Lender will make the proceeds of such Revolving Loan available
to the Agent on the date of the requested borrowing as set forth in the Notice
of Borrowing and the Agent may (but shall not be obligated to), in reliance upon
such assumption, make available to the Borrower the amount of such Revolving
Loan to be provided by such Lender.  Subject to satisfaction of the applicable
conditions set forth in Article VI. for such borrowing, the Agent will make the
proceeds of such borrowing available to the Borrower no later than 12:00 noon on
the date specified by the Borrower in such Notice of Borrowing by depositing
such proceeds in the  applicable Designated Account.

 

Section 2.2.  Bid Rate Loans.

(a)Bid Rate Loans.  At any time during the period from the Effective Date to but
excluding the Revolving Termination Date, and so long as the Borrower continues
to maintain an Investment Grade Rating, the Borrower may, as set forth in this
Section, request the Lenders to make offers to make Bid Rate Loans to the
Borrower in Dollars.  The Lenders may, but shall have no obligation to, make
such offers and the Borrower may, but shall have no obligation to, accept any
such offers in the manner set forth in this Section.

 

 

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(b)Requests for Bid Rate Loans.  When the Borrower wishes to request from the
Lenders offers to make Bid Rate Loans, it shall give the Agent notice (a “Bid
Rate Quote Request”) so as to be received no later than 9:00 a.m. Pacific time
on (x) the Business Day immediately preceding the date of borrowing proposed
therein, in the case of an Absolute Rate Auction and (y) the date four (4)
Business Days prior to the proposed date of borrowing, in the case of a LIBOR
Auction.  The Agent shall deliver to each Lender a copy of each Bid Rate Quote
Request promptly upon receipt thereof by the Agent.  The Borrower may request
offers to make Bid Rate Loans for up to 3 different Interest Periods in any one
Bid Rate Quote Request; provided that if granted each separate Interest Period
shall be deemed to be a separate borrowing (a “Bid Rate Borrowing”).  Each Bid
Rate Quote Request shall be substantially in the form of Exhibit M and shall
specify as to each Bid Rate Borrowing all of the following:

 

(i)the proposed date of such Bid Rate Borrowing, which shall be a Business Day;

 

(ii)the aggregate amount of such Bid Rate Borrowing which shall be in a minimum
amount of $10,000,000 and integral multiples of $1,000,000 in excess thereof
which shall not cause any of the limits specified in Section 2.18. to be
violated;

 

(iii)whether the Bid Rate Quote Request is for LIBOR Margin Loans or Absolute
Rate Loans; and

 

(iv)the duration of the Interest Period applicable thereto, which shall not
extend beyond the Revolving Termination Date.

 

The Borrower shall not deliver any Bid Rate Quote Request within five Business
Days of the giving of any other Bid Rate Quote Request and the Borrower shall
not deliver more than one Bid Rate Quote Request in any calendar month.

 

(c)Bid Rate Quotes.

 

(i)Each Lender may submit one or more Bid Rate Quotes, each containing an offer
to make a Bid Rate Loan in response to any Bid Rate Quote Request; provided
that, if the Borrower’s request under Section 2.2.(b) specified more than one
Interest Period, such Lender may make a single submission containing only one
Bid Rate Quote for each such Interest Period.  Each Bid Rate Quote must be
submitted to the Agent not later than 8:30 a.m. Pacific time (x) on the proposed
date of borrowing, in the case of an Absolute Rate Auction and (y) on the date
three (3) Business Days prior to the proposed date of borrowing, in the case of
a LIBOR Auction, and in either case the Agent shall disregard any Bid Rate Quote
received after such time; provided that the Lender then acting as the Agent may
submit a Bid Rate Quote only if it notifies the Borrower of the terms of the
offer contained therein not later than 30 minutes prior to the latest time by
which the Lenders must submit applicable Bid Rate Quotes.  Any Bid Rate Quote so
made shall be irrevocable except with the consent of the Agent given at the
request of the Borrower.  Such Bid Rate Loans may be funded by a Lender’s SPC
(if any) as provided in

 

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Section 13.5.(k); however, such Lender shall not be required to specify in its
Bid Rate Quote whether such Bid Rate Loan will be funded by such SPC.

 

(ii)Each Bid Rate Quote shall be substantially in the form of Exhibit M and
shall specify:

 

(A)the proposed date of borrowing and the Interest Period therefor;

 

(B)the principal amount of the Bid Rate Loan for which each such offer is being
made; provided that the aggregate principal amount of all Bid Rate Loans for
which a Lender submits Bid Rate Quotes (x) may be greater or less than the
Commitment of such Lender but (y) shall not exceed the principal amount of the
Bid Rate Borrowing for a particular Interest Period for which offers were
requested; provided further that any Bid Rate Quote shall be in a minimum amount
of $5,000,000 and integral multiples of $1,000,000 in excess thereof;

 

(C)in the case of an Absolute Rate Auction, the rate of interest per annum
(rounded upwards, if necessary, to the nearest 1/1,000th of 1%) offered for each
such Absolute Rate Loan (the “Absolute Rate”);

 

(D)in the case of a LIBOR Auction, the margin above or below applicable LIBOR
(the “LIBOR Margin”) offered for each such LIBOR Margin Loan, expressed as a
percentage (rounded upwards, if necessary, to the nearest 1/1,000th of 1%) to be
added to (or subtracted from) the applicable LIBOR; and

 

(E)the identity of the quoting Lender.

 

Unless otherwise agreed by the Agent and the Borrower, no Bid Rate Quote shall
contain qualifying, conditional or similar language or propose terms other than
or in addition to those set forth in the applicable Bid Rate Quote Request and,
in particular, no Bid Rate Quote may be conditioned upon acceptance by the
Borrower of all (or some specified minimum) of the principal amount of the Bid
Rate Loan for which such Bid Rate Quote is being made.

 

(d)Notification by Agent.  The Agent shall, as promptly as practicable after the
Bid Rate Quotes are submitted (but in any event not later than 9:30 a.m. Pacific
time (x) on the proposed date of borrowing, in the case of an Absolute Rate
Auction or (y) on the date three (3) Business Days prior to the proposed date of
borrowing, in the case of a LIBOR Auction), notify the Borrower of the terms (i)
of any Bid Rate Quote submitted by a Lender that is in accordance with
Section 2.2.(c) and (ii) of any Bid Rate Quote that amends, modifies or is
otherwise inconsistent with a previous Bid Rate Quote submitted by such Lender
with respect to the same Bid Rate Quote Request.  Any such subsequent Bid Rate
Quote shall be disregarded by the Agent unless such subsequent Bid Rate Quote is
submitted solely to correct a manifest error in such former Bid Rate Quote.  The
Agent’s notice to the Borrower shall specify (A) the aggregate principal amount
of the Bid Rate Borrowing for which offers have been received and (B) the

 

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principal amounts and Absolute Rates or LIBOR Margins, as applicable, so offered
by each Lender (identifying the Lender that made such Bid Rate Quote).

 

(e)Acceptance by Borrower.

 

(i)Not later than 10:30 a.m. Pacific time (x) on the proposed date of borrowing,
in the case of an Absolute Rate Auction and (y) on the date three (3) Business
Days prior to the proposed date of borrowing, in the case of a LIBOR Auction,
the Borrower shall notify the Agent of its acceptance or nonacceptance of the
Bid Rate Quotes so notified to it pursuant to Section 2.2.(d). which notice
shall be in the form of Exhibit N.  In the case of acceptance, such notice shall
specify the aggregate principal amount of Bid Rate Quotes for each Interest
Period that are accepted.  The failure of the Borrower to give such notice by
such time shall constitute nonacceptance.  The Borrower may accept any Bid Rate
Quote in whole or in part; provided that:

 

(A)the aggregate principal amount of each Bid Rate Borrowing may not exceed the
applicable amount set forth in the related Bid Rate Quote Request;

 

(B)the aggregate principal amount of each Bid Rate Borrowing shall comply with
the provisions of Section 2.2.(b)(ii) and together with all other Bid Rate Loans
then outstanding shall not cause the limits specified in Section 2.18. to be
violated;

 

(C)acceptance of Bid Rate Quotes may be made only in ascending order of Absolute
Rates or LIBOR Margins, as applicable, in each case beginning with the lowest
rate so offered;

 

(D)any acceptance in part by the Borrower shall be in a minimum amount of
$5,000,000 and integral multiples of $1,000,000 in excess thereof; and

 

(E)the Borrower may not accept any Bid Rate Quote that fails to comply with
Section 2.2.(c) or otherwise fails to comply with the requirements of this
Agreement.

 

(ii)If Bid Rate Quotes are made by two or more Lenders with the same Absolute
Rates or LIBOR Margins, as applicable, for a greater aggregate principal amount
than the amount in respect of which Bid Rate Quotes are permitted to be accepted
for the related Interest Period, the principal amount of Bid Rate Loans in
respect of which such Bid Rate Quotes  are accepted shall be allocated by the
Agent among such Lenders in proportion to the aggregate principal amount of such
Bid Rate Quotes.  Determinations by the Agent of the amounts of Bid Rate Loans
shall be conclusive in the absence of manifest error.

 

(f)Obligation to Make Bid Rate Loans.  The Agent shall promptly (and in any
event not later than (x) 11:30 a.m. Pacific time on the proposed date of
borrowing of Absolute Rate Loans and (y) on the date three (3) Business Days
prior to the proposed date of borrowing of

 

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LIBOR Margin Loans) notify each Lender as to whose Bid Rate Quote has been
accepted and the amount and rate thereof.  A Lender who is notified that it has
been selected to make a Bid Rate Loan may designate its SPC (if any) to fund
such Bid Rate Loan on its behalf, as described in Section 13.5.(k).  Any SPC
which funds a Bid Rate Loan shall on and after the time of such funding become
the obligee in respect of such Bid Rate Loan and be entitled to receive payment
thereof when due.  No Lender shall be relieved of its obligation to fund a Bid
Rate Loan, and no SPC shall assume such obligation, prior to the time the
applicable Bid Rate Loan is funded.  Any Lender whose offer to make any Bid Rate
Loan has been accepted shall, not later than 12:30 p.m. Pacific time on the date
specified for the making of such Loan, make the amount of such Loan available to
the Agent at its Principal Office in immediately available funds, for the
account of the Borrower.  The amount so received by the Agent shall, subject to
the terms and conditions of this Agreement, be made available to the Borrower
not later than 1:30 p.m. Pacific time on such date by depositing the same, in
immediately available funds, in an account of the Borrower designated by the
Borrower.

 

(g)No Effect on Commitment.  Except for the purpose and to the extent expressly
stated in Section 2.13. and 2.18., the amount of any Bid Rate Loan made by any
Lender shall not constitute a utilization of such Lender’s Commitment.

 

Section 2.3.  Letters of Credit.

(a)Letters of Credit.  Subject to the terms and conditions of this Agreement,
including without limitation, Section 2.18., the AgentIssuing Banks, on behalf
of the Lenders, agreesagree to issue for the account of the Borrower during the
period from and including the Effective Date to, but excluding, the date 30 days
prior to the Termination Date, one or more letters of credit (each a “Letter of
Credit”) up to a maximum aggregate Stated Amount at any one time outstanding not
to exceed $50,000,000 as such amount may be reduced from time to time in
accordance with the terms hereof (the “L/C Commitment Amount”); provided, that
an Issuing Bank shall not be obligated to issue any Letter of Credit if, after
giving effect to such issuance, the aggregate Stated Amount of outstanding
Letters of Credit issued by such Issuing Bank would exceed the lesser of (i)
one-half of the L/C Commitment Amount and (ii) the Commitment of such Issuing
Bank in its capacity as a Lender hereunder.

 

(b)Terms of Letters of Credit.  At the time of issuance, the amount, form, terms
and conditions of each Letter of Credit, and of any drafts or acceptances
thereunder, shall be subject to approval by the Agentapplicable Issuing Bank and
the Borrower.  Notwithstanding the foregoing, in no event may (i) the expiration
date of any Letter of Credit extend beyond the Termination Date, (ii) any Letter
of Credit have an initial duration in excess of one year, or (iii) any Letter of
Credit contain an automatic renewal provision (other than renewal provisions
which are automatic in the absence of a notice of non-renewalnon-renewal from
the Agentapplicable Issuing Bank so long as any such renewal provision does not
provide for a renewal period that extends beyond the Termination Date). 

 

(c)Requests for Issuance of Letters of Credit.  The Borrower shall give the
applicable Issuing Bank and the Agent written notice at least 5 Business Days
prior to the requested date of issuance of a Letter of Credit, such notice to
describe in reasonable detail the proposed terms of such Letter of Credit and
the nature of the transactions or obligations proposed to be supported

 

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by such Letter of Credit, and in any event shall set forth with respect to such
Letter of Credit (i) the requested initial Stated Amount, (ii) the proposed
beneficiary, (iii) whether such Letter of Credit is to be a standby or
commercial letter of credit, and (iv) the requested expiration date.  The
Borrower shall also execute and deliver such customary applications and
agreements for standby letters of credit, and other forms as requested from time
to time by the Agentapplicable Issuing Bank.  Provided the Borrower has given
the notice prescribed by the first sentence of this subsection and delivered
such application and agreements referred to in the preceding sentence, subject
to the other terms and conditions of this Agreement, including the satisfaction
of any applicable conditions precedent set forth in Article VI., the
Agentapplicable Issuing Bank shall issue the requested Letter of Credit on the
requested date of issuance for the benefit of the stipulated beneficiary but in
no event prior to the date 5 Business Days following the date after which the
Agentapplicable Issuing Bank has received all of the items required to be
delivered to it under this subsection.  No Issuing Bank shall at any time be
obligated to issue any Letter of Credit if such issuance would conflict with, or
cause such Issuing Bank or any Lender to, exceed any limits imposed by any
Applicable Law.  References to “issue” and derivations thereof with respect to
Letters of Credit shall also include extensions or modifications of any
outstanding Letters of Credit, unless the context otherwise requires.  Upon the
written request of the Borrower, the Agentapplicable Issuing Bank shall deliver
to the Borrower a copy of (i) any Letter of Credit proposed to be issued by such
Issuing Bank hereunder prior to the issuance thereof and (ii) each issued Letter
of Credit by such Issuing Bank within a reasonable time after the date of
issuance thereof.  To the extent any term of a Letter of Credit Document is
inconsistent with a term of any Loan Document, the term of such Loan Document
shall control.

 

(d)Reimbursement Obligations.  Upon receipt by the Agentan Issuing Bank from the
beneficiary of a Letter of Credit issued by such Issuing Bank of any demand for
payment under such Letter of Credit, the Agent and such Issuing Bank’s
determination that such demand for payment complies with the requirements of
such Letter of Credit, such Issuing Bank shall promptly notify the Borrower and
the Agent of the amount to be paid by the Agentsuch Issuing Bank as a result of
such demand and the date on which payment is to be made by the Agentsuch Issuing
Bank to such beneficiary in respect of such demand.  The Borrower hereby
absolutely, unconditionally and irrevocably agrees to pay and reimburse the
Agenteach applicable Issuing Bank for the amount of each demand for payment
under such Letter of Credit at or prior to the date on which payment is to be
made by the Agentsuch Issuing Bank to the beneficiary thereunder, without
presentment, demand, protest or other formalities of any kind.  Upon receipt by
the Agentan Issuing Bank of any payment in respect of any Reimbursement
Obligation, the Agent in respect of a Letter of Credit issued by such Issuing
bank, such Issuing Bank shall promptly pay to each Lender that has acquired a
participation therein under the second sentence of Section 2.3.(i) such Lender’s
Commitment Percentage of such payment.

 

(e)Manner of Reimbursement.  Upon its receipt of a notice referred to in the
immediately preceding subsection (d), the Borrower shall advise the Agent and
the applicable Issuing Bank whether or not the Borrower intends to borrow
hereunder to finance its obligation to reimburse the Agentapplicable Issuing
Bank  for the amount of the related demand for payment and, if it does, the
Borrower shall submit a timely request for such borrowing as provided in the
applicable provisions of this Agreement.  If the Borrower fails to so advise the
Agent and such Issuing Bank, or if the Borrower fails to reimburse the
Agentapplicable Issuing

 

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Bank for a demand for payment under a Letter of Credit issued by such Issuing
Bank by the date of such payment (the failure of which the applicable Issuing
Bank shall promptly notify the Administrative Agent), then (i) if the applicable
conditions contained in Article VI. would permit the making of Revolving Loans,
the Borrower shall be deemed to have requested a borrowing of Revolving Loans
(which shall be Base Rate Loans) in an amount equal to the unpaid Reimbursement
Obligation and the Agent shall give each Lender prompt notice of the amount of
the Revolving Loan to be made available to the Agent not later than 11:00 a.m.
and (ii) if such conditions would not permit the making of Revolving Loans, the
provisions of subsection (j) of this Section shall apply. The amount limitations
set forth in the second sentence of Section 3.5.(a) shall not apply to any
borrowing of Base Rate Loans under this subsection.

 

(f)Effect of Letters of Credit on Commitments.  Upon the issuance by the Agentan
Issuing Bank of any Letter of Credit and until such Letter of Credit shall have
expired or been terminated, the Commitment of each Lender shall be deemed to be
utilized for all purposes of this Agreement in an amount equal to the product of
(i) such Lender’s Commitment Percentage and (ii) the sum of (A) the Stated
Amount of such Letter of Credit plus (B) any related Reimbursement Obligations
then outstanding.

 

(g)Agent’sIssuing Banks’ Duties Regarding Letters of Credit; Unconditional
Nature of Reimbursement Obligations.  In examining documents presented in
connection with drawings under Letters of Credit and making payments under such
Letters of Credit against such documents, the Agenteach Issuing Bank shall only
be required to use the same standard of care as it uses in connection with
examining documents presented in connection with drawings under letters of
credit in which it has not sold participations and making payments under such
letters of credit.  The Borrower assumes all risks of the acts and omissions of,
or misuse of the Letters of Credit by, the respective beneficiaries of such
Letters of Credit.  In furtherance and not in limitation of the foregoing,
neithernone of the Issuing Banks, the Agent noror any of the Lenders shall be
responsible for, and Borrower’s obligations in respect of Letters of Credit
shall not be affected in any manner by, (i) the form, validity, sufficiency,
accuracy, genuineness or legal effects of any document submitted by any party in
connection with the application for and issuance of or any drawing honored under
any Letter of Credit even if itsuch document should in fact prove to be in any
or all respects invalid, insufficient, inaccurate, fraudulent or forged;
(ii) the validity or sufficiency of any instrument transferring or assigning or
purporting to transfer or assign any Letter of Credit, or the rights or benefits
thereunder or proceeds thereof, in whole or in part, which may prove to be
invalid or ineffective for any reason; (iii) failure of the beneficiary of any
Letter of Credit to comply fully with conditions required in order to draw upon
such Letter of Credit; (iv) errors, omissions, interruptions or delays in
transmission or delivery of any messages, by mail, cable, telex, telecopy,
electronic mail or otherwise, whether or not they be in cipher; (v) errors in
interpretation of technical terms; (vi) any loss or delay in the transmission or
otherwise of any document required in order to make a drawing under any Letter
of Credit, or of the proceeds thereof; (vii) the misapplication by the
beneficiary of any such Letter of Credit, or of the proceeds of any drawing
under suchany Letter of Credit; or (viii) any consequences arising from causes
beyond the control of the Issuing Banks, the Agent or the Lenders.  None of the
above shall affect, impair or prevent the vesting of any of the Issuing Banks’
or the Agent’s rights or powers hereunder.  Any action taken or omitted to be
taken by the Agentan Issuing Bank under or in connection with any Letter of
Credit issued by

 

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such Issuing Bank, if taken or omitted in the absence of gross negligence or
willful misconduct, shall not create against the Agentsuch Issuing Bank any
liability to the Borrower, the Agent, any other Issuing Bank or any Lender.  In
this connection, the obligation of the Borrower to reimburse the Agentapplicable
Issuing Bank for any drawing made under any Letter of Credit issued by such
Issuing Bank, and to repay any Revolving Loan made pursuant to the second
sentence of the immediately preceding subsection (e), shall be absolute,
unconditional and irrevocable and shall be paid strictly in accordance with the
terms of this Agreement orand any other applicable Letter of Credit Document
under all circumstances whatsoever, including without limitation, the following
circumstances: (A) any lack of validity or enforceability of any Letter of
Credit Document or any term or provisions therein; (B) any amendment or waiver
of or any consent to departure from all or any of the Letter of Credit
Documents; (C) the existence of any claim, setoff, defense or other right which
the Borrower may have at any time against any Issuing Bank, the Agent, any
Lender, any beneficiary of a Letter of Credit or any other Person, whether in
connection with this Agreement, the transactions contemplated hereby or in the
Letter of Credit Documents or any unrelated transaction; (D) any breach of
contract or dispute between the Borrower, any Issuing Bank the Agent, any Lender
or any other Person; (E) any demand, statement or any other document presented
under a Letter of Credit proving to be forged, fraudulent, invalid or
insufficient in any respect or any statement therein or made in connection
therewith being untrue or inaccurate in any respect whatsoever; (F) any
non‑application or misapplication by the beneficiary of a Letter of Credit or of
the proceeds of any drawing under such Letter of Credit; (G) payment by the
Agentan Issuing Bank under theany Letter of Credit issued by it against
presentation of a draft or certificate which does not strictly comply with the
terms of thesuch Letter of Credit; and (H) any other act, omission to act, delay
or circumstance whatsoever that might, but for the provisions of this Section,
constitute a legal or equitable defense to or discharge of the Borrower’s
Reimbursement Obligations.

 

(h)Amendments, Etc.  The issuance by the Agentan Issuing Bank of any amendment,
supplement or other modification to any Letter of Credit issued by it shall be
subject to the same conditions applicable under this Agreement to the issuance
of new Letters of Credit (including, without limitation, that the request
therefor be made through the applicable Issuing Bank and the Agent), and no such
amendment, supplement or other modification shall be issued unless either
(i) the respective Letter of Credit affected thereby would have complied with
such conditions had it originally been issued hereunder in such amended,
supplemented or modified form or (ii) the Requisite Lenders shall have consented
thereto.  In connection with any such amendment, supplement or other
modification, the Borrower shall pay the fees, if any, payable under the last
sentence of Section 3.6.(b).

 

(i)Lenders’ Participation in Letters of Credit.  Immediately upon the issuance
by the Agentapplicable Issuing Bank of any Letter of Credit (or in the case of
Existing Letters of Credit, upon the Agreement Date) each Lender shall be deemed
to have absolutely, irrevocably and unconditionally purchased and received from
the Agentsuch Issuing Bank, without recourse or warranty, an undivided interest
and participation to the extent of such Lender’s Commitment Percentage of the
liability of the Agentsuch Issuing Bank with respect to such Letter of Credit
and each Lender thereby shall absolutely, unconditionally and irrevocably
assume, as primary obligor and not as surety, and shall be unconditionally
obligated to the Agentsuch Issuing Bank to pay and discharge when due, such
Lender’s Commitment Percentage of the Agent’ssuch

 

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Issuing Bank’s liability under such Letter of Credit.  In addition, upon the
making of each payment by a Lender to the Agent in respect of any Letter of
Credit for the account of an Issuing Bank pursuant to the immediately following
subsection (j), such Lender shall, automatically and without any further action
on the part of any Issuing Bank, the Agent or such Lender, acquire (i) a
participation in an amount equal to such payment in the Reimbursement Obligation
owing to the Agentsuch Issuing Bank by the Borrower in respect of such Letter of
Credit and (ii) a participation in a percentage equal to such Lender’s
Commitment Percentage in any interest or other amounts payable by the Borrower
in respect of such Reimbursement Obligation (other than the Fees payable to the
Agentsuch Issuing Bank pursuant to the second and last sentences of
Section 3.6.(b)).

 

(j)Payment Obligation of Lenders.  Each Lender severally agrees to pay to the
Agent, for the account of the applicable Issuing Bank, on demand in immediately
available funds the amount of such Lender’s Commitment Percentage of each
drawing paid by the Agentsuch Issuing Bank under each Letter of Credit issued by
such Issuing Bank to the extent such amount is not reimbursed by the Borrower
pursuant to Section 2.3.(d).  Each such Lender’s obligation to make such
payments to the Agent under this subsection, and the Agent’s right to receive
the same for the account of the applicable Issuing Bank, shall be absolute,
irrevocable and unconditional and shall not be affected in any way by any
circumstance whatsoever, including without limitation, (i) the failure of any
other Lender to make its payment under this subsection, (ii) the financial
condition of the Borrower or any other Loan Party, (iii) the existence of any
Default or Event of Default, including any Event of Default described in
Section 11.1.(e) or 11.1.(f) or (iv) the termination of the Commitments.  Each
such payment to the Agent for the account of any Issuing Bank shall be made
without any offset, abatement, withholding or deduction whatsoever. 

 

(k)Information to Lenders.  Promptly following any change in Lettersany Letter
of Credit outstanding, the Agentapplicable Issuing Bank shall deliver to the
Agent, who shall promptly deliver the same to each Lender and the Borrower a
notice describing the aggregate amount of all Letters of Credit issued by such
Issuing Bank and outstanding at such time.  Upon the request of any Lender from
time to time, the Agenteach Issuing Bank shall deliver any other information
reasonably requested by such Lender with respect to each Letter of Credit issued
by such Issuing Bank and then outstanding.  Other than as set forth in this
subsection, the AgentIssuing Banks shall have no duty to notify the Lenders
regarding the issuance or other matters regarding Letters of Credit issued
hereunder.  The failure of the Agentany Issuing Bank to perform its requirements
under this subsection shall not relieve any Lender from its obligations under
Section 2.3.(j).

 

(l)Existing Letters of Credit.  The Borrower, the Issuing Banks, the Agent and
the Lenders agree that each of the letters of credit described on
Schedule 2.3.(l) (the “Existing Letters of Credit”) shall, from and after the
Effective Date, be deemed to be a Letter of Credit issued under this Agreement
and shall be subject to and governed by the terms and conditions of this
Agreement and the other Loan Documents.

 

 

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Section 2.4.  Swingline Loans.

(a)Swingline Loans.  Subject to the terms and conditions hereof, including
without limitation, Section 2.18., if necessary to meet the various funding
deadlines of the Borrower, the Swingline Lender agrees to make Swingline Loans
in Dollars to the Borrower, during the period from the Effective Date to but
excluding the Swingline Termination Date, in an aggregate principal amount at
any one time outstanding up to, but not exceeding, the amount of the Swingline
Commitment.  If at any time the aggregate principal amount of the Swingline
Loans outstanding at such time exceeds the Swingline Commitment in effect at
such time, the Borrower shall immediately pay the Agent for the account of the
Swingline Lender the amount of such excess.  Subject to the terms and conditions
of this Agreement, the Borrower may borrow, repay and reborrow Swingline Loans
hereunder.

 

(b)Procedure for Borrowing Swingline Loans.  The Borrower shall give the Agent
and the Swingline Lender notice pursuant to a Notice of Swingline Borrowing
delivered to the Swingline Lender no later than 1:00 p.m. on the proposed date
of such borrowing.  Any such telephonic notice shall include all information to
be specified in a written Notice of Swingline Borrowing.  Not later than 3:00
p.m. on the date of the requested Swingline Loan and subject to satisfaction of
the applicable conditions set forth in Article VI. for such borrowing, the
Swingline Lender will make the proceeds of such Swingline Loan available to the
Borrower in Dollars, in immediately available funds, by depositing them in the
applicable Designated Account.

 

(c)Interest.  Swingline Loans shall bear interest at the Base Rate or such other
rates as the Borrower and the Swingline Lender may agree from time to time in
writing.  Interest payable on Swingline Loans is solely for the account of the
Swingline Lender.  All accrued and unpaid interest on Swingline Loans shall be
payable on the dates and in the manner provided in Section 2.5. with respect to
interest on Base Rate Loans (except as the Swingline Lender and the Borrower may
otherwise agree in writing in connection with any particular Swingline Loan). 

 

(d)Swingline Loan Amounts, Etc.  Each Swingline Loan shall be in the minimum
amount of $500,000, or such other minimum amounts agreed to by the Swingline
Lender and the Borrower.  Any voluntary prepayment of a Swingline Loan must be
in the minimum amount of $100,000 or, if less, the aggregate principal amount of
all outstanding Swingline Loans (or such other minimum amounts upon which the
Swingline Lender and the Borrower may agree) and in connection with any such
prepayment, the Borrower must give the Swingline Lender prior written notice
thereof no later than 10:00 a.m. on the day prior to the date of such
prepayment.  The Swingline Loans shall, in addition to this Agreement, be
evidenced by the Swingline Notes.

 

(e)Repayment and Participations of Swingline Loans.  The Borrower agrees to
repay each Swingline Loan borrowed by it within one Business Day of demand
therefor by the Swingline Lender and in any event, within 5 Business Days after
the date such Swingline Loan was made.  Notwithstanding the foregoing, the
Borrower shall repay the entire outstanding principal amount of, and all accrued
but unpaid interest on, the Swingline Loans borrowed by it on the Swingline
Termination Date (or such earlier date as the Swingline Lender and the Borrower
may agree in writing).  In lieu of demanding repayment of any outstanding
Swingline Loan from the Borrower, the Swingline Lender may, on behalf of the
Borrower (which hereby irrevocably directs the Swingline Lender to act on its
behalf), request a borrowing of Revolving

 

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Loans (which shall be Base Rate Loans) from the Lenders in an amount equal to
the principal balance of such Swingline Loan.  The amount limitations contained
in Section 3.5.(a) shall not apply to any borrowing of Base Rate Loans made
pursuant to this subsection.  The Swingline Lender shall give notice to the
Agent of any such borrowing of Base Rate Loans not later than 10:00 a.m. at
least one Business Day prior to the proposed date of such borrowing.  Each
Lender will make available to the Agent at the Principal Office for the account
of Swingline Lender, in immediately available funds, the proceeds of the Base
Rate Loan to be made by such Lender.  The Agent shall pay the proceeds of such
Base Rate Loans to the Swingline Lender, which shall apply such proceeds to
repay such Swingline Loan.  If the Lenders are prohibited from making Loans
required to be made under this subsection for any reason whatsoever, including
without limitation, the occurrence of any of the Defaults or Events of Default
described in Sections 11.1.(e) or 11.1.(f), each Lender shall purchase from the
Swingline Lender, without recourse or warranty, an undivided interest and
participation to the extent of such Lender’s Commitment Percentage of such
Swingline Loan, by directly purchasing a participation in such Swingline Loan in
such amount and paying the proceeds thereof to the Agent for the account of the
Swingline Lender in Dollars and in immediately available funds.  A Lender’s
obligation to purchase such a participation in a Swingline Loan shall be
absolute and unconditional and shall not be affected by any circumstance
whatsoever, including without limitation, (i) any claim of setoff, counterclaim,
recoupment, defense or other right which such Lender or any other Person may
have or claim against the Agent, the Swingline Lender or any other Person
whatsoever, (ii) the occurrence or continuation of a Default or Event of Default
(including without limitation, any of the Defaults or Events of Default
described in Sections 11.1.(e) or 11.1.(f)) or the termination of the
Commitments of any Lender, (iii) the existence (or alleged existence) of an
event of condition which has had or could have a Material Adverse Effect,
(iv) any breach of any Loan Document by the Agent, any Lender, the Borrower or
any other Loan Party or (v) any other circumstance, happening or event
whatsoever, whether or not similar to any of the foregoing.  If such amount is
not in fact made available to the Swingline Lender by any Lender, the Swingline
Lender shall be entitled to recover such amount on demand from such Lender,
together with accrued interest thereon for each day from the date of demand
thereof, at the Federal Funds Rate.  If such Lender does not pay such amount
forthwith upon the Swingline Lender’s demand therefor, and until such time as
such Lender makes the required payment, the Swingline Lender shall be deemed to
continue to have outstanding Swingline Loans in the amount of such unpaid
participation obligation for all purposes of the Loan Documents (other than
those provisions requiring the other Lenders to purchase a participation
therein).  Further, such Lender shall be deemed to have assigned any and all
payments made of principal and interest on its Loans, and any other amounts due
to it hereunder, to the Swingline Lender to fund Swingline Loans in the amount
of the participation in Swingline Loans that such Lender failed to purchase
pursuant to this Section until such amount has been purchased (as a result of
such assignment or otherwise).

 

Section 2.5.  Rates and Payment of Interest on Loans.

(a)Rates.  The Borrower promises to pay to the Agent for the account of each
Lender interest on the unpaid principal amount of each Loan made by such Lender
for the period from and including the date of the making of such Loan to but
excluding the date such Loan shall be paid in full, at the following per annum
rates:

 

 

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(i)during such periods as such Loan is a Base Rate Loan, at the Base Rate (as in
effect from time to time), plus the Applicable Margin for Base Rate Loans;

 

(ii)during such periods as such Loan is a LIBOR Loan, at LIBOR for such Loan for
the Interest Period therefor, plus the Applicable Margin for LIBOR Loans;

 

(iii)if such Loan is an Absolute Rate Loan, at the Absolute Rate for such Loan
for the Interest Period therefor quoted by the Lender making such Loan in
accordance with Section 2.2.; and

 

(iv)if such Loan is a LIBOR Margin Loan, at LIBOR for such Loan for the Interest
Period therefor plus the LIBOR Margin quoted by the Lender making such Loan in
accordance with Section 2.2.

 

Notwithstanding the foregoing, during the continuance of an Event of Default,
the Borrower shall pay to the Agent for the account of each Lender and each
Issuing Bank interest at the Post-Default Rate on the outstanding principal
amount of any Loan made by such Lender, on all Reimbursement Obligations and on
any other amount payable by the Borrower hereunder or under the Notes held by
such Lender to or for the account of such Lender (including without limitation,
accrued but unpaid interest to the extent permitted under Applicable Law). 

 

(b)Payment of Interest. All accrued and unpaid interest on the outstanding
principal amount of each Loan shall be payable (i) in the case of Base Rate
Loans, monthly in arrears on the first day of each month, (ii) in the case of a
LIBOR Loan or a Bid Rate Loan, on the last day of each Interest Period therefor
and, if such Interest Period is longer than three months, at three-month
intervals following the first day of such Interest Period, and (iii) for all
Loans, (A) on the Termination Date and (B) on any date on which the principal
balance of such Loan is due and payable in full (whether at maturity, due to
acceleration or otherwise).  Interest payable at the Post-Default Rate shall be
payable from time to time on demand.  All determinations by the Agent of an
interest rate hereunder shall be conclusive and binding on the Lenders and the
Borrower for all purposes, absent manifest error.

 

(c)Borrower Information Used to Determine Applicable Interest Rates.  The
parties understand that the applicable interest rate for the Obligations and
certain fees set forth herein may be determined and/or adjusted from time to
time based upon certain financial ratios and/or other information to be provided
or certified to the Lenders by the Borrower (the “Borrower Information”).  If it
is subsequently determined that any such Borrower Information was incorrect (for
whatever reason, including without limitation because of a subsequent
restatement of earnings by the Borrower) at the time it was delivered to the
Agent, and if the applicable interest rate or fees calculated for any period
were lower than they should have been had the correct information been timely
provided, then, such interest rate and such fees for such period shall be
automatically recalculated using correct Borrower Information.  The Agent shall
promptly notify the Borrower in writing of any additional interest and fees due
because of such recalculation, and the Borrower shall pay such additional
interest or fees due to the Agent, for the account of each Lender, within 5
Business Days of receipt of such written notice.  Any recalculation of interest
or fees required by this provision shall survive the termination of this

 

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Agreement, and this provision shall not in any way limit any of the Agent’s or
any Lender’s other rights under this Agreement.

 

Section 2.6.  Number of Interest Periods.

There may be no more than 8 different Interest Periods with respect to LIBOR
Loans outstanding at the same time and no more than 5 different Interest Periods
with respect to Bid Rate Loans outstanding at the same time.

 

Section 2.7.  Repayment of Loans.

(a)Revolving Loans.  The Borrower shall repay the aggregate outstanding
principal balance of all Revolving Loans in full on the Termination Date.

 

(b)Bid Rate Loans.  The Borrower shall repay the entire outstanding principal
amount of, and all accrued interest on, each Bid Rate Loan on the last day of
the Interest Period of such Bid Rate Loan.

Section 2.8.  Prepayments.

(a)Optional.  Subject to Section 5.4., the Borrower may prepay any Revolving
Loan at any time without premium or penalty.  The Borrower shall give the Agent
at least one Business Days prior written notice of the prepayment of any
Revolving Loan.  A Bid Rate Loan may only be prepaid with the prior written
consent of the Lender holding such Bid Rate Loan.

 

(b)Mandatory. 

 

(i)Commitment Overadvance.  If at any time the aggregate principal amount of all
outstanding Loans, together with the aggregate amount of all Letter of Credit
Liabilities, exceeds the aggregate amount of the Commitments, the Borrower
shall, within three calendar days after notice of the occurrence of such excess,
pay to the Agent for the account of the Issuing Banks and/or the Lenders, as
applicable, the amount of such excess.  All payments under this subsection (i)
shall be applied to pay all amounts of excess principal outstanding on the
applicable Revolving Loans and any applicable Reimbursement Obligations in
accordance with Section 3.2., and the remainder, if any, shall be deposited into
the Letter of Credit Collateral Account for application to any Reimbursement
Obligations as and when due.

 

(ii)Bid Rate Facility Overadvance.  If at any time the aggregate principal
amount of all outstanding Bid Rate Loans exceeds one‑half of the aggregate
amount of all Commitments at such time, then the Borrower shall, within three
calendar days after notice of the occurrence of such excess, pay to the Agent
for the accounts of the applicable Lenders the amount of such excess.  All
payments under this subsection (ii) shall be applied in accordance with
Section 3.2.(f).

 

 

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Section 2.9.  Late Charges[Intentionally Omitted].

If the Borrower fails to pay any interest payable under this Agreement on or
prior to the expiration of 10 days after such interest first becomes due and
payable, the Borrower shall pay to the Agent for the benefit of the Lenders a
late charge equal to four percent (4.0%) of the amount of such unpaid interest
payment. The Borrower acknowledges and agrees that an accurate determination of
the Lenders’ damages as a result of the Borrower’s failure to pay interest as
and when due hereunder is not reasonably practicable, and the late charge
provided for herein is a reasonable estimate of the amount of additional cost
and the value of the loss of use of funds that will be suffered by the Lenders
if an interest payment is not paid when due.

 

Section 2.10.  Continuation.

So long as no Default or Event of Default exists, the Borrower may on any
Business Day, with respect to any LIBOR Loan, elect to maintain such LIBOR Loan
or any portion thereof as a LIBOR Loan by selecting a new Interest Period for
such LIBOR Loan.  Each new Interest Period selected under this Section shall
commence on the last day of the immediately preceding Interest Period.  Each
selection of a new Interest Period shall be made by the Borrower giving to the
Agent a Notice of Continuation not later than 10:00 a.m. on the third Business
Day prior to the date of any such Continuation of LIBOR Loans.  Such notice by
the Borrower of a Continuation shall be by telecopy, electronic mail or other
form of communication in the form of a Notice of Continuation, specifying
(a) the proposed date of such Continuation, (b) the LIBOR Loan and portion
thereof subject to such Continuation and (c) the duration of the selected
Interest Period, all of which shall be specified in such manner as is necessary
to comply with all limitations on Loans outstanding hereunder.  Each Notice of
Continuation shall be irrevocable by and binding on the Borrower once
given.  Promptly after receipt of a Notice of Continuation, the Agent shall
notify each Lender by telecopy, electronic mail or other similar form of
transmission of the proposed Continuation.  If the Borrower shall fail to select
in a timely manner a new Interest Period for any LIBOR Loan in accordance with
this Section, such Loan will automatically, on the last day of the current
Interest Period therefor, Convert into a Base Rate Loan notwithstanding the
failure of the Borrower to comply with Section 2.11.  

 

Section 2.11.  Conversion.

So long as no Default or Event of Default exists, the Borrower may on any
Business Day, upon the Borrower’s giving of a Notice of Conversion to the Agent,
Convert all or a portion of a Revolving Loan of one Type into a Revolving Loan
of another Type.  Any Conversion of a LIBOR Loan into a Base Rate Loan shall be
made on, and only on, the last day of an Interest Period for such LIBOR Loan
and, upon Conversion of a Base Rate Loan into a LIBOR Loan, the Borrower shall
pay accrued interest to the date of Conversion on the principal amount so
Converted.  Each such Notice of Conversion shall be given not later than
10:00 a.m. (i) one Business Day prior to the date of any proposed Conversion
into Base Rate Loans, and (ii) three Business Days prior to the date of any
proposed Conversion into LIBOR Loans.  Promptly after receipt of a Notice of
Conversion, the Agent shall notify each Lender by telecopy, electronic mail or
other similar form of transmission of the proposed Conversion.  Subject to the
restrictions specified above, each Notice of Conversion shall be by telecopy in
the form of a Notice of Conversion specifying (a) the requested date of such
Conversion, (b) the Type of

 

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Revolving Loan to be Converted, (c) the portion of such Type of Loan to be
Converted, (d) the Type of Revolving Loan such Loan is to be Converted into, and
(e) if such Conversion is into a LIBOR Loan, the requested duration of the
Interest Period of such Loan.  Each Notice of Conversion shall be irrevocable by
and binding on the Borrower once given. 

 

Section 2.12.  Notes.

The Revolving Loans made by each Lender shall, in addition to this Agreement,
also be evidenced by a promissory note of the Borrower substantially in the form
of Exhibit J (each a “Revolving Note”), payable to the order of such Lender and
duly completed.  The Bid Rate Loans made by a Lender to the Borrower shall, in
addition to this Agreement, also be evidenced by a Bid Rate Note payable to the
order of such Lender.

 

Section 2.13.  Voluntary Reductions of the Commitment.

The Borrower shall have the right to terminate or reduce the aggregate unused
amount of the Commitments (for which purpose use of the Commitments shall be
deemed to include the aggregate principal amount of all outstanding Swingline
Loans and Bid Rate Loans and the aggregate amount of Letter of Credit
Liabilities) at any time and from time to time without penalty or premium upon
not less than 5 Business Days prior written notice to the Agent of each such
termination or reduction, which notice shall specify the effective date thereof
and the amount of any such reduction and shall be irrevocable once given and
effective only upon receipt by the Agent; provided,  however, that if the
Borrower seeks to reduce the aggregate amount of the Commitments below
$75,000,000, then, unless the Agent and all Lenders have otherwise previously
agreed in writing, the Commitments shall be reduced to zero and, except as
otherwise provided herein, the provisions of this Agreement shall
terminate.  The Agent will promptly transmit such notice to each Lender.  The
Commitments, once terminated or reduced may not be increased or reinstated.  Any
reduction in the aggregate amount of the Commitments shall result in a
proportionate reduction (rounded to the next lowest integral multiple of
$100,000) in each of the L/C Commitment Amount and the Swingline Commitment. 

 

Section 2.14.  [Intentionally Omitted].

Section 2.15.  [Intentionally Omitted].

Section 2.16.  Expiration or Maturity Date of Letters of Credit Past Termination
of Facility.

If on the date the Commitments are terminated in full (whether voluntarily, by
reason of the occurrence of an Event of Default or otherwise), there are any
Letters of Credit outstanding hereunder, the Borrower shall, on such date, pay
to the Agent, for the benefit of the Issuing Banks, the Agent, and the Lenders,
an amount of money equal to the Stated Amount of such Letter(s) of Credit and in
the applicable Designated Currencies of such Letters of Credit for deposit into
the Letter of Credit Collateral Account.  If a drawing pursuant to any such
Letter of Credit occurs on or prior to the expiration date of such Letter of
Credit, the Borrower authorizes the Agent to use the monies deposited in the
Letter of Credit Collateral Account to make payment to the beneficiary with
respect to such drawing or the payee with respect to such

 

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presentment.  If no drawing occurs on or prior to the expiration date of such
Letter of Credit, the Agent shall pay to the Borrower (or to whomever else may
be legally entitled thereto) the monies deposited in the Letter of Credit
Collateral Account with respect to such outstanding Letter of Credit on or
before the date 30 days after the expiration date of such Letter of Credit.

 

Section 2.17.  Increase in Commitments.

At any time and from time to time beginning on the Effective Date to but
excluding the Termination Date, the Borrower shall have the right to request an
increase in the aggregate amount of the Commitments by providing written notice
to the Agent, which notice shall be irrevocable once given; provided,  however,
that after giving effect to such increase the aggregate amount of the
Commitments shall not exceed $600,000,000800,000,000. The Agent shall promptly
notify each Lender of any such request.  No Lender shall be obligated in any way
whatsoever to increase its Commitment.  If a new Lender becomes a party to this
Agreement, or if any existing Lender agrees to increase its Commitment, such
Lender shall on the date it becomes a Lender hereunder (or in the case of an
existing Lender, increases its Commitment) (and as a condition thereto) purchase
from the other Lenders its Commitment Percentage (determined with respect to the
Lenders’ relative Commitments and after giving effect to the increase of
Commitments) of any outstanding Revolving Loans, by making available to the
Agent for the account of such other Lenders, in immediately available funds, an
amount equal to the sum of (A) the portion of the outstanding principal amount
of such Revolving Loans to be purchased by such Lender plus (B) interest accrued
and unpaid to and as of such date on such portion of the outstanding principal
amount of such Loans.  The Borrower shall pay to the Lenders amounts payable, if
any, to such Lenders under Section 5.4. as a result of the prepayment of any
such Loans.  An increase of the aggregate amount of the Commitments may not be
effected under this Section if either (x) a Default or Event of Default shall be
in existence on the effective date of such increase or (y) any representation or
warranty made or deemed made by the Borrower or any other Loan Party in any Loan
Document to which such Loan Party is a party is not (or would not be) true or
correct on the effective date of such increase except to the extent that such
representations and warranties expressly relate solely to an earlier date (in
which case such representations and warranties shall have been true and accurate
on and as of such earlier date) and except for changes in factual circumstances
specifically and expressly permitted hereunder.  In connection with an increase
in the aggregate amount of the Commitments pursuant to this Section (a) any
Lender becoming a party hereto shall execute such documents and agreements as
the Agent may reasonably request, and (b) the Borrower shall make appropriate
arrangements so that each new Lender, and any existing Lender increasing its
Commitment, receives a new or replacement Note, as appropriate, in the amount of
such Lender’s Commitment at the time of the effectiveness of the increase in the
aggregate amount of Commitments.

 

Section 2.18.  Amount Limitations.

Notwithstanding any other term of this Agreement, no Lender shall be required to
make any Loan, no Lender shall make any Bid Rate Loan, and the Agentno Issuing
Bank shall not be required to issue any Letter of Credit if, immediately after
the making of such Loan or issuance of such Letter of Credit (a) the aggregate
principal amount of all outstanding Loans, together with the aggregate amount of
all Letter of Credit Liabilities, would exceed the aggregate amount

 

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of the Commitments, or (b) the aggregate principal amount of all outstanding Bid
Rate Loans would exceed one-half of the aggregate amount of the Commitments at
such time.

 

Article III. Payments, Fees and Other General Provisions

Section 3.1.  Payments.

All payments to be made by the Borrower shall be made without condition or
deduction for any counterclaim, defense, recoupment or setoff.  Except to the
extent otherwise provided herein, all payments of principal, interest and other
amounts to be made by the Borrower under this Agreement or any other Loan
Document shall be made in Dollars, in immediately available funds.  The Borrower
shall make each payment of any amount due under this Agreement not later than
11:00 a.m. on the date on which such payment shall become due (each such payment
made after such time on such due date to be deemed to have been made on the next
succeeding Business Day).  The Borrower shall, at the time of making each
payment under this Agreement or any Note, specify to the Agent the amounts
payable by the Borrower hereunder to which such payment is to be applied.  Each
payment received by the Agent for the account of a Lender or an Issuing Bank
under this Agreement or any Note of such Lender shall be paid to such Lender or
Issuing Bank, by wire transfer of immediately available funds in accordance with
the wiring instructions provided by such Lender or Issuing Bank to the Agent
from time to time, for the account of such Lender at the applicable Lending
Office of such Lenderor Issuing Bank.  If the Agent fails to pay such amount to
a Lender or an Issuing Bank within one Business Day of receipt thereof by the
Agent, the Agent shall pay interest on such amount until paid at a rate per
annum equal to the Federal Funds Rate from time to time in effect.  If the due
date of any payment under this Agreement or any other Loan Document would
otherwise fall on a day which is not a Business Day such date shall be extended
to the next succeeding Business Day and interest shall be payable for the period
of such extension.

 

Section 3.2.  Pro Rata Treatment.

Except to the extent otherwise provided herein: (a) each borrowing from the
Lenders under Section 2.1.(a) shall be made from the Lenders, each payment of
the Fees under Section 3.6.(a) and the first sentence of Section 3.6.(b) shall
be made for the account of the Lenders, and each termination or reduction of the
amount of the Commitments under Section 2.13. or otherwise pursuant to this
Agreement shall be applied to the respective Commitments of the Lenders, pro
rata according to the amounts of their respective Commitments; (b) each payment
or prepayment of principal of Revolving Loans by the Borrower shall be made for
the account of the Lenders pro rata in accordance with the respective unpaid
principal amounts of the Revolving Loans held by them, provided that, subject to
Section  3.10.,if immediately prior to giving effect to any such payment in
respect of any Revolving Loans the outstanding principal amount of the Revolving
Loans shall not be held by the Lenders pro rata in accordance with their
respective Commitments in effect at the time such Loans were made, then such
payment shall be applied to the Revolving Loans in such manner as shall result,
as nearly as is practicable, in the outstanding principal amount of the
Revolving Loans being held by the Lenders pro rata in accordance with their
respective Commitments; (c) each payment of interest on Revolving Loans by the
Borrower shall be made for the account of the Lenders pro rata in accordance
with the amounts of interest on such Loans then due and

 

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payable to the respective Lenders; (d) the making, Conversion and Continuation
of Revolving Loans of a particular Type (other than Conversions provided for by
Section 5.5.) shall be made pro rata among the Lenders according to the amounts
of their respective Commitments (in the case of making of Loans) or their
respective Revolving Loans (in the case of Conversions and Continuations of
Revolving Loans) and the then current Interest Period for each Lender’s portion
of each Loan of such Type shall be coterminous; (e) the Lenders’ participation
in, and payment obligations in respect of, Letters of Credit under Section 2.3.
and Swingline Loans under Section 2.4., shall be pro rata in accordance with
their respective Commitments.  All payments of principal, interest, fees and
other amounts in respect of the Swingline Loans shall be for the account of the
Swingline Lender only (except to the extent any Lender shall have acquired a
participating interest in any such Swingline Loan pursuant to Section 2.4.(e));
and (f) each prepayment of principal of Bid Rate Loans by the Borrower pursuant
to Section 2.8.(b)(ii) shall be made for account of the Lenders then owed Bid
Rate Loans pro rata in accordance with the respective unpaid principal amounts
of the Bid Rate Loans then owing to each such Lender.

 

Section 3.3.  Sharing of Payments, Etc.

If a Lender shall obtain payment of any principal of, or interest on, any Loan
made by it to the Borrower under this Agreement, or shall obtain payment on any
other Obligation owing by the Borrower or a Loan Party through the exercise of
any right of set‑off, banker’s lien or counterclaim or similar right or
otherwise or through voluntary prepayments directly to a Lender or other
payments made by the Borrower or any other Loan Party to a Lender not in
accordance with the terms of this Agreement and such payment should be
distributed to the Lenders pro rata in accordance with Section 3.2. or
Section 11.5., as applicable, such Lender shall promptly purchase from the other
Lenders participations in (or, if and to the extent specified by such Lender,
direct interests in) the Loans made by the other Lenders or other Obligations
owed to such other Lenders in such amounts, pay such amounts to the other
Lenders and make such other adjustments from time to time as shall be equitable,
so that all the Lenders shall share the benefit of such payment (net of any
reasonable expenses which may be incurred by such Lender in obtaining or
preserving such benefit) pro rata in accordance with Section 3.2. or
Section 11.5.  To such end, all the Lenders shall make appropriate adjustments
among themselves (by the resale of participations sold or otherwise) if such
payment is rescinded or must otherwise be restored.  The Borrower agrees that
any Lender so purchasing a participation (or direct interest) in the Loans or
other Obligations owed to such other Lenders may exercise all rights of set‑off,
banker’s lien, counterclaim or similar rights with respect to such participation
as fully as if such Lender were a direct holder of Loans in the amount of such
participation.  Nothing contained herein shall require any Lender to exercise
any such right or shall affect the right of any Lender to exercise, and retain
the benefits of exercising, any such right with respect to any other
indebtedness or obligation of the Borrower.

 

Section 3.4.  Several Obligations.

No Lender shall be responsible for the failure of any other Lender to make a
Loan or to perform any other obligation to be made or performed by such other
Lender hereunder, and the failure of any Lender to make a Loan or to perform any
other obligation to be made or performed by it hereunder shall not relieve the
obligation of any other Lender to make any Loan or to perform any other
obligation to be made or performed by such other Lender.

 

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Section 3.5.  Minimum Amounts.

(a)Borrowings.  Each borrowing of Base Rate Loans shall be in an aggregate
minimum amount of $5,000,000.  Each borrowing of and Continuation of, and each
Conversion of Base Rate Loans into, LIBOR Loans shall be in an aggregate minimum
amount of $5,000,000. 

 

(b)Prepayments.  Each voluntary prepayment of Revolving Loans shall be in an
aggregate minimum amount of $100,000, or if less, the entire outstanding balance
of Revolving Loans. 

 

(c)Reductions of Commitments.  Each reduction of the Commitments under
Section 2.13. shall be in an aggregate minimum amount of $5,000,000 and integral
multiples of $100,000 in excess thereof.

 

Section 3.6.  Fees.

(a)Facility Fees. During the period from the Effective Date to but excluding the
Termination Date, the Borrower agrees to pay to the Agent for the account of the
Lenders a facility fee equal to the daily aggregate amount of the Commitments
(whether or not utilized) times a rate per annum equal to the Applicable
Facility Fee. Such fee shall be payable quarterly in arrears on the last day of
each March, June, September and December during the term of this Agreement and
on the Termination Date. 

 

(b)Letter of Credit Fees.  The Borrower agrees to pay to the Agent for the
account of each Lender a letter of credit fee at a rate per annum equal to the
Applicable Margin times the daily average Stated Amount of each Letter of Credit
for the period from and including the date of issuance of such Letter of Credit
(x) to and including the date such Letter of Credit expires or is terminated or
(y) to but excluding the date such Letter of Credit is drawn in full; provided,
 however, in no event shall the aggregate amount of such fee be less than $500. 
The Agent shall be entitled to deduct from such Letter of Credit fees, and
retain In addition, the Borrower shall pay to each Issuing Bank, for its own
account and not for the account of any Lender, a fronting fee in respect of each
Letter of Credit issued by such Issuing Bank at the rate equal to one‑eighth of
one percent (0.125%) per annum on the daily average Stated Amount of such Letter
of Credit.  The fees provided for in the immediately preceding two sentencesthis
subsection shall be nonrefundable and payable in the case of the fee provided
for in the first sentence  in arrears (i) quarterly on the last day of March,
June, September and December, (ii) on the Termination Date, (iii) on the date
the Commitments are terminated or reduced to zero and (iv) thereafter from time
to time on demand of the Agent, and in the case of the fee provided for in the
second sentence, at the time of issuance of such Letter of Credit.  The Borrower
shall pay directly to the Agenteach Issuing Bank from time to time on demand all
commissions, charges, costs and expenses in the amounts customarily charged by
the Agentsuch Issuing Bank from time to time in like circumstances with respect
to the issuance by such Issuing Bank of each Letter of Credit, drawings,
amendments and other transactions relating thereto.

 

 

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(c)Other Fees.  The Borrower agrees to pay such other fees of the Agent, the
Issuing Banks and the Lenders as may be agreed to in writing from time to time
between the Borrower and the Agent, any Issuing Bank or any Lenders, as the case
may be.

 

Section 3.7.  Computations.

Unless otherwise expressly set forth herein, any accrued interest on any Loan,
any Fees or other Obligations due hereunder shall be computed on the basis of a
year of 360 days and the actual number of days elapsed.

 

Section 3.8.  Usury.

In no event shall the amount of interest due or payable on the Loans or other
Obligations exceed the maximum rate of interest allowed by Applicable Law and,
if any such payment is paid by the Borrower or received by any Lender, then such
excess sum shall be credited as a payment of principal, unless the Borrower
shall notify the respective Lender in writing that the Borrower elects to have
such excess sum returned to it forthwith.  It is the express intent of the
parties hereto that the Borrower not pay and the Lenders not receive, directly
or indirectly, in any manner whatsoever, interest in excess of that which may be
lawfully paid by the Borrower under Applicable Law.  The parties hereto hereby
agree and stipulate that the only charge imposed upon the Borrower for the use
of money in connection with this Agreement is and shall be the interest
specifically described in subsections (i) through (iv) of Section 2.5.(a) and in
Section 2.4.(c).  Notwithstanding the foregoing, the parties hereto further
agree and stipulate that all agency fees, syndication fees, facility fees,
letter of credit fees, underwriting fees, default charges, late charges, funding
or “breakage” charges, increased cost charges, attorneys’ fees and reimbursement
for costs and expenses paid by the Agent or any Lender to third parties or for
damages incurred by the Agent or any Lender, are charges made to compensate the
Agent or any such Lender for underwriting or administrative services and costs
or losses performed or incurred, and to be performed or incurred, by the Agent
and the Lenders in connection with this Agreement and shall under no
circumstances be deemed to be charges for the use of money.  All charges other
than charges for the use of money shall be fully earned and nonrefundable when
due.

 

Section 3.9.  Statements of Account.

The Agent will account to the Borrower monthly with a statement of Loans,
Letters of Credit, accrued interest and Fees, charges and payments made pursuant
to this Agreement and the other Loan Documents, and such account rendered by the
Agent shall be deemed conclusive upon the Borrower absent manifest error.  The
Agent will account to the Borrower on changes in Letters of Credit in accordance
with Section 2.3.(k).  The failure of the Agent to deliver such a statement of
accounts shall not relieve or discharge the Borrower from any of its obligations
hereunder.

 

 

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Section 3.10.  Defaulting Lenders.

Notwithstanding anything to the contrary contained in this Agreement, if any
Lender becomes a Defaulting Lender, then, until such time as such Lender is no
longer a Defaulting Lender, to the extent permitted by Applicable Law:

 

(a)Waivers and Amendments.  Such Defaulting Lender’s right to approve or
disapprove any amendment, waiver or consent with respect to this Agreement shall
be restricted as set forth in the definition of Requisite Lenders.

 

(b)Defaulting Lender Waterfall.  Any payment of principal, interest, Fees or
other amounts received by the Agent for the account of such Defaulting Lender
(whether voluntary or mandatory, at maturity, pursuant to Article XI. or
otherwise) shall be applied at such time or times as may be determined by the
Agent as follows: first, to the payment of any amounts owing by such Defaulting
Lender to the Agent (other than in respect of Letters of Credit) hereunder;
second, to the payment on a pro rata basis of any amounts owing by such
Defaulting Lender to the Agenteach Issuing Bank (in respect of Letters of
Credit) or the Swingline Lender hereunder; third, to Cash Collateralize the
Agent’sIssuing Banks’ Fronting ExposureExposures with respect to such Defaulting
Lender in accordance with subsection (e) below; fourth, as the Borrower may
request (so long as no Default or Event of Default exists), to the funding of
any Loan in respect of which such Defaulting Lender has failed to fund its
portion thereof as required by this Agreement, as determined by the Agent;
fifth, if so determined by the Agent and the Borrower, to be held in a deposit
account and released pro rata in order to (x) satisfy such Defaulting Lender’s
potential future funding obligations with respect to Loans under this Agreement
and (y) Cash Collateralize the Agent’sIssuing Banks’ future Fronting
ExposureExposures with respect to such Defaulting Lender with respect to future
Letters of Credit issued under this Agreement, in accordance with subsection (e)
below; sixth, to the payment of any amounts owing to the Lenders, the Issuing
Banks, the Agent or the Swingline Lender as a result of any judgment of a court
of competent jurisdiction obtained by any Lender, any Issuing Bank, the Agent or
the Swingline Lender against such Defaulting Lender as a result of such
Defaulting Lender’s breach of its obligations under this Agreement; seventh, so
long as no Default or Event of Default exists, to the payment of any amounts
owing to the Borrower as a result of any judgment of a court of competent
jurisdiction obtained by the Borrower against such Defaulting Lender as a result
of such Defaulting Lender’s breach of its obligations under this Agreement; and
eighth, to such Defaulting Lender or as otherwise directed by a court of
competent jurisdiction; provided that if (x) such payment is a payment of the
principal amount of any Loans or amounts owing by such Defaulting Lender under
Section 2.3.(j) in respect of Letters of Credit (such amounts
“L/C Disbursements”), in respect of which such Defaulting Lender has not fully
funded its appropriate share, and (y) such Loans were made or the related
Letters of Credit were issued at a time when the conditions set forth in
Article VI. were satisfied or waived, such payment shall be applied solely to
pay the Loans of, and L/C Disbursements owed to, all non-Defaulting Lenders on a
pro rata basis prior to being applied to the payment of any Loans of, or L/C
Disbursements owed to, such Defaulting Lender until such time as all Loans and
funded and unfunded participations in Letter of Credit Liabilities and Swingline
Loans are held by the Lenders pro rata in accordance with their respective
Commitment Percentages (determined without giving effect to the immediately
following subsection (d)).  Any payments, prepayments or other amounts paid or
payable to a Defaulting Lender that are applied (or held) to pay

 

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amounts owed by a Defaulting Lender or to post Cash Collateral pursuant to this
subsection shall be deemed paid to and redirected by such Defaulting Lender, and
each Lender irrevocably consents hereto.

 

(c)Certain Fees.

 

(i)No Defaulting Lender shall be entitled to receive any Fee payable under
Section 3.6.(a) for any period during which that Lender is a Defaulting Lender,
and the Borrower shall not be required to pay any such fee to a Defaulting
Lender that otherwise would have been required to have been paid to that
Defaulting Lender.

 

(ii)Each Defaulting Lender shall be entitled to receive the Fee payable under
Section 3.6.(b) for any period during which that Lender is a Defaulting Lender
only to the extent allocable to its Commitment Percentage of the stated amount
of Letters of Credit for which it has provided Cash Collateral pursuant to the
immediately following subsection (e).

 

(iii)With respect to any Fee not required to be paid to any Defaulting Lender
pursuant to the immediately preceding clauses (i) or (ii), the Borrower shall
(x) pay to each non‑Defaulting Lender that portion of any such Fee otherwise
payable to such Defaulting Lender with respect to such Defaulting Lender’s
participation in Letter of Credit Liabilities or Swingline Loans that has been
reallocated to such non‑Defaulting Lender pursuant to the immediately following
subsection (d), (y) pay to the Agenteach Issuing Bank and the Swingline Lender,
as applicable, the amount of any such Fee otherwise payable to such Defaulting
Lender to the extent allocable to the Agent’ssuch Issuing Bank’s or Swingline
Lender’s Fronting Exposure to such Defaulting Lender, and (z) not be required to
pay the remaining amount of any such Fee.

 

(d)Reallocation of Participations to Reduce Fronting Exposure.  All or any part
of such Defaulting Lender’s participation in Letter of Credit Liabilities and
Swingline Loans shall be reallocated among the non-Defaulting Lenders in
accordance with their respective Commitment Percentages (determined without
regard to such Defaulting Lender’s Commitment) but only to the extent that
(x) the conditions set forth in Article VI. are satisfied at the time of such
reallocation (and, unless the Borrower shall have otherwise notified the Agent
at such time, the Borrower shall be deemed to have represented and warranted
that such conditions are satisfied at such time), and (y) such reallocation does
not cause the aggregate Revolving Credit Exposure of any non-Defaulting Lender
to exceed such non-Defaulting Lender’s Commitment.  No reallocation hereunder
shall constitute a waiver or release of any claim of any party hereunder against
a Defaulting Lender arising from that Lender having become a Defaulting Lender,
including any claim of a non-Defaulting Lender as a result of such
non-Defaulting Lender’s increased exposure following such reallocation.

 

(e)Cash Collateral, Repayment of Swingline Loans.

 

(i)If the reallocation described in the immediately preceding subsection (d)
above cannot, or can only partially, be effected, the Borrower shall, without
prejudice to

 

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any right or remedy available to it hereunder or under law, (x) first, prepay
Swingline Loans in an amount equal to the Swingline Lender’s Fronting Exposure
and (y) second, Cash Collateralize the Agent’sIssuing Banks’ Fronting
ExposureExposures in accordance with the procedures set forth in this
subsection.

 

(ii)At any time that there shall exist a Defaulting Lender, within 1 Business
Day following the written request of the Agent or any Issuing Bank, the Borrower
shall Cash Collateralize the Agent’ssuch Issuing Bank’s Fronting Exposure with
respect to such Defaulting Lender (determined after giving effect to the
immediately preceding subsection (d) and any Cash Collateral provided by such
Defaulting Lender) in an amount not less than the aggregate Fronting Exposure of
the Agentsuch Issuing Bank with respect to Letters of Credit issued by such
Issuing Bank and outstanding at such time.

 

(iii)The Borrower, and to the extent provided by any Defaulting Lender, such
Defaulting Lender, hereby grant to the Agent, for itsthe benefit of the Issuing
Banks, and agree to maintain, a first priority security interest in all such
Cash Collateral as security for the Defaulting Lenders’ obligation to fund
participations in respect of Letter of Credit Liabilities, to be applied
pursuant to the immediately following clause (iv).  If at any time the Agent
determines that Cash Collateral is subject to any right or claim of any Person
other than the Agent and the Issuing Banks as herein provided, or that the total
amount of such Cash Collateral is less than the aggregate Fronting Exposure of
the AgentIssuing Banks with respect to Letters of Credit issued and outstanding
at such time, the Borrower will, promptly upon demand by the Agent, pay or
provide to the Agent, for the account of the Issuing Banks, additional Cash
Collateral in an amount sufficient to eliminate such deficiency (after giving
effect to any Cash Collateral provided by the Defaulting Lender).

 

(iv)Notwithstanding anything to the contrary contained in this Agreement, Cash
Collateral provided under this Section in respect of Letters of Credit shall be
applied to the satisfaction of the Defaulting Lender’s obligation to fund
participations in respect of Letter of Credit Liabilities (including, as to Cash
Collateral provided by a Defaulting Lender, any interest accrued on such
obligation) for which the Cash Collateral was so provided, prior to any other
application of such property as may otherwise be provided for herein.

 

(v)Cash Collateral (or the appropriate portion thereof) provided to reduce the
Agent’sIssuing Banks’ Fronting ExposureExposures shall no longer be required to
be held as Cash Collateral pursuant to this subsection following (x) the
elimination of the applicable Fronting Exposure (including by the termination of
Defaulting Lender status of the applicable Lender), or (y) the determination by
the Agent and the Issuing Banks that there exists excess Cash Collateral;
provided that, subject to the immediately preceding subsection (b), the Person
providing Cash Collateral and the AgentIssuing Banks may (but shall not be
obligated to) agree that Cash Collateral shall be held to support future
anticipated Fronting Exposure or other obligations and provided further that to
the extent that such Cash Collateral was provided by the Borrower, such Cash

 

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Collateral shall remain subject to the security interest granted pursuant to the
Loan Documents.

 

(f)Defaulting Lender Cure.  If the Borrower, the Agent, the Issuing Banks and
the Swingline Lender agree in writing that a Lender is no longer a Defaulting
Lender, the Agent will so notify the parties hereto, whereupon as of the
effective date specified in such notice and subject to any conditions set forth
therein (which may include arrangements with respect to any Cash Collateral),
that Lender will, to the extent applicable, purchase at par that portion of
outstanding Loans of the other Lenders or take such other actions as the Agent
may determine to be necessary to cause the Loans and funded and unfunded
participations in Letters of Credit and Swingline Loans to be held pro rata by
the Lenders in accordance with their respective Commitment Percentages
(determined without giving effect to the immediately preceding subsection (d)),
whereupon such Lender will cease to be a Defaulting Lender; provided that no
adjustments will be made retroactively with respect to Fees accrued or payments
made by or on behalf of the Borrower while that Lender was a Defaulting Lender;
and provided,  further, that except to the extent otherwise expressly agreed by
the affected parties, no change hereunder from Defaulting Lender to Lender will
constitute a waiver or release of any claim of any party hereunder arising from
that Lender’s having been a Defaulting Lender.

 

(g)New Swingline Loans/Letters of Credit.  So long as any Lender is a Defaulting
Lender, (i) the Swingline Lender shall not be required to fund any Swingline
Loans unless it is satisfied that it will have no Fronting Exposure after giving
effect to such Swingline Loan and (ii) the Agentno Issuing Bank shall not be
required to issue, extend, renew or increase any Letter of Credit unless it is
satisfied that it will have no Fronting Exposure after giving effect thereto.

 

(h)Purchase of Defaulting Lender’s Commitment.  During any period that a Lender
is a Defaulting Lender, the Borrower may, by the Borrower giving written notice
thereof to the Agent, such Defaulting Lender and the other Lenders, demand that
such Defaulting Lender assign its Commitment and Loans to an Eligible Assignee
subject to and in accordance with the provisions of Section 13.5.(b).  No party
hereto shall have any obligation whatsoever to initiate any such replacement or
to assist in finding an Eligible Assignee.  In addition, any Lender who is not a
Defaulting Lender may, but shall not be obligated, in its sole discretion, to
acquire the face amount of all or a portion of such Defaulting Lender’s
Commitment and Loans via an assignment subject to and in accordance with the
provisions of Section 13.5.(d).  In connection with any such assignment, such
Defaulting Lender shall promptly execute all documents reasonably requested to
effect such assignment, including an appropriate Assignment and Acceptance
Agreement and, notwithstanding Section 13.5.(b), shall pay to the Agent an
assignment fee in the amount of $7,500.  The exercise by the Borrower of its
rights under this Section shall be at the Borrower’s sole cost and expense and
at no cost or expense to the Agent or any of the Lenders.

 

Section 3.11.  Taxes.

(a)Taxes Generally.  All payments by the Borrower of principal of, and interest
on, the Loans and all other Obligations shall be made free and clear of and
without deduction for any present or future excise, stamp or other taxes, fees,
duties, levies, imposts, charges, deductions, withholdings or other charges of
any nature whatsoever imposed by any taxing authority, but

 

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excluding (i) franchise taxes, (ii) any taxes (other than withholding taxes)
that would not be imposed but for a connection between the Agent or a Lender and
the jurisdiction imposing such taxes (other than a connection arising solely by
virtue of the activities of the Agent or such Lender pursuant to or in respect
of this Agreement or any other Loan Document), (iii)  any taxes imposed on or
measured by any Lender’s assets, net income, receipts or branch profits,
(iv) any taxes arising after the Agreement Date solely as a result of or
attributable to a Lender changing its designated Lending Office after the date
such Lender becomes a party hereto and (v) any taxes imposed by Sections 1471
through 1474 of the Internal Revenue Code (including any official
interpretations thereof, collectively “FATCA”) on any “withholdable payment”
payable to such recipient as a result of the failure of such recipient to
satisfy the applicable requirements as set forth in FATCA after December 31,
2012 (such non‑excluded items being collectively called “Taxes”).  If any
withholding or deduction from any payment to be made by the Borrower hereunder
is required in respect of any Taxes pursuant to any Applicable Law, then the
Borrower will:

 

(i)pay directly to the relevant Governmental Authority the full amount required
to be so withheld or deducted;

 

(ii)promptly forward to the Agent an official receipt or other documentation
satisfactory to the Agent evidencing such payment to such Governmental
Authority; and

 

(iii)pay to the Agent for its account or the account of the applicable Lender,
as the case may be, such additional amount or amounts as is necessary to ensure
that the net amount actually received by the Agent or such Lender will equal the
full amount that the Agent or such Lender would have received had no such
withholding or deduction been required.

 

A Lender that is entitled to an exemption from or reduction of withholding Tax
with respect to payments made under any Loan Document shall deliver to the
Borrower and the Agent, at the time or times reasonably requested by the
Borrower or the Agent, such properly completed and executed documentation
reasonably requested by the Borrower or the Agent as will permit such payments
to be made without withholding or at a reduced rate of withholding.   If
reasonably requested by the Borrower or the Agent, a Lender shall deliver such
other documentation prescribed by applicable law or reasonably requested by the
Borrower or the Agent as will enable the Borrower or the Agent to determine
whether or not such Lender is subject to backup withholding or information
reporting requirements.

 

(b)Tax Indemnification.  If the Borrower fails to pay any Taxes when due to the
appropriate Governmental Authority or fails to remit to the Agent, for its
account or the account of the respective Lender, as the case may be, the
required receipts or other required documentary evidence, the Borrower shall
indemnify the Agent and the Lenders for any incremental Taxes, interest or
penalties that may become payable by the Agent or any Lender as a result of any
such failure.  For purposes of this Section, a distribution hereunder by the
Agent or any Lender to or for the account of any Lender shall be deemed a
payment by the Borrower.

 

 

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(c)Tax Forms.  Prior to the date that any Lender or Participant organized under
the laws of a jurisdiction outside the United States of America becomes a party
hereto, such Person shall deliver to the Borrower and the Agent such
certificates, documents or other evidence, as required by the Internal Revenue
Code or Treasury Regulations issued pursuant thereto (including Internal Revenue
Service Forms W-8ECI and W-8BEN, as applicable, or appropriate successor forms),
properly completed, currently effective and duly executed by such Lender or
Participant establishing that payments to it hereunder and under the Notes are
(i) not subject to United States Federal backup withholding tax and (ii) not
subject to United States Federal withholding tax under the Code.  Each Lender
shall (x) deliver further copies of such forms or other appropriate
certifications on or before the date that any such forms expire or become
obsolete and after the occurrence of any event requiring a change in the most
recent form delivered to the Borrower and (y) obtain such extensions of the time
for filing, and renew such forms and certifications thereof as may be reasonably
requested by the Borrower or the Agent.  The Borrower shall not be required to
pay any amount pursuant to the second sentence of subsection (a) above to any
Lender or Participant that is organized under the laws of a jurisdiction outside
of the United States of America or the Agent, if it is organized under the laws
of a jurisdiction outside of the United States of America, if such Lender,
Participant or the Agent, as applicable, fails to comply with the requirements
of this subsection.

 

Article IV.  [Intentionally omitted].

Article V. Yield Protection, Etc.

Section 5.1.  Additional Costs; Capital Adequacy.

(a)Additional Costs.  The Borrower shall promptly pay to the Agent for the
account of a Lender from time to time such amounts as such Lender may reasonably
determine to be necessary to compensate such Lender for any costs incurred by
such Lender that it determines are attributable to its making or maintaining of
any LIBOR Loans or LIBOR Margin Loans or its obligation to make any LIBOR Loans
or LIBOR Margin Loans hereunder, any reduction in any amount receivable by such
Lender under this Agreement or any of the other Loan Documents in respect of any
of such Loans or such obligation or the maintenance by such Lender of capital in
respect of its Loans or its Commitments (such increases in costs and reductions
in amounts receivable being herein called “Additional Costs”), resulting from
any Regulatory Change that:  (i) changes the basis of taxation of any amounts
payable to such Lender under this Agreement or any of the other Loan Documents
in respect of any of such Loans or its Commitments (other than taxes imposed on
or measured by the overall net income of such Lender or of its Lending Office
for any of such Loans by the jurisdiction in which such Lender has its principal
office or such Lending Office); or (ii) imposes or modifies any reserve, special
deposit or similar requirements (excluding Regulation D of the Board of
Governors of the Federal Reserve System or other similar reserve requirement
applicable to any other category of liabilities or category of extensions of
credit or other assets by reference to which the interest rate on LIBOR Loans or
LIBOR Margin Loans is determined to the extent utilized when determining LIBOR
for such Loan) relating to any extensions of credit or other assets of, or any
deposits with or other liabilities of, such Lender, or any commitment of such
Lender (including, without limitation, the Commitments of such Lender
hereunder); or (iii) has or would have the effect of reducing the rate of return
on capital of such Lender to a level below that which such Lender could have

 

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achieved but for such Regulatory Change (taking into consideration such Lender’s
policies with respect to capital adequacy).

 

(b)Lender’s Suspension of LIBOR Loans and LIBOR Margin Loans.  Without limiting
the effect of the provisions of the immediately preceding subsection (a), if by
reason of any Regulatory Change, any Lender either (i) incurs Additional Costs
based on or measured by the excess above a specified level of the amount of a
category of deposits or other liabilities of such Lender that includes deposits
by reference to which the interest rate on LIBOR Loans or LIBOR Margin Loans is
determined as provided in this Agreement or a category of extensions of credit
or other assets of such Lender that includes LIBOR Loans or LIBOR Margin Loans
or (ii) becomes subject to restrictions on the amount of such a category of
liabilities or assets that it may hold, then, if such Lender so elects by notice
to the Borrower (with a copy to the Agent), the obligation of such Lender to
make or Continue, or to Convert any other Type of Loans into, LIBOR Loans and/or
the obligation of a Lender that has outstanding a Bid Rate Quote hereunder shall
be suspended until such Regulatory Change ceases to be in effect (in which case
the provisions of Section 5.5. shall apply).

 

(c)Additional Costs in Respect of Letters of Credit.  Without limiting the
obligations of the Borrower under the preceding subsections of this Section (but
without duplication), if as a result of any Regulatory Change or any risk-based
capital guideline or other requirement heretofore or hereafter issued by any
Governmental Authority there shall be imposed, modified or deemed applicable any
tax, reserve, special deposit, capital adequacy or similar requirement against
or with respect to or measured by reference to Letters of Credit and the result
shall be to increase the cost to the Agentan Issuing Bank of issuing (or any
Lender purchasing participations in) or maintaining its obligation hereunder to
issue (or purchase participations in) any Letter of Credit or reduce any amount
receivable by the Agentan Issuing Bank or any Lender hereunder in respect of any
Letter of Credit, then, upon demand by the Agentsuch Issuing Bank or such
Lender, the Borrower shall pay promptly, and in any event within three Business
Days of demand, to such Issuing Bank, or in the case of a Lender, to the Agent
for its account or the account of such Lender, as applicable, from time to time
as specified by the Agentsuch Issuing Bank or a Lender, such additional amounts
as shall be sufficient to compensate the Agentsuch Issuing Bank or such Lender
for such increased costs or reductions in amount. 

 

(d)Notification and Determination of Additional Costs.  Each of the Agent, each
Issuing Bank and each Lender agrees to notify the Borrower of any event
occurring after the Agreement Date entitling the Agent, such Issuing Bank or
such Lender to compensation under any of the preceding subsections of this
Section as promptly as practicable; provided, however, the failure of the Agent,
any Issuing Bank or any Lender to give such notice shall not release the
Borrower from any of its obligations hereunder; provided, further, that the
Borrower shall not be required to compensate a Lender or the Agent pursuant to
this Section for any increased costs incurred or reductions suffered more than
six months prior to the date that such Lender or Agent, as the case may be,
notifies the Borrower of the event entitling the Agent or Lender to compensation
giving rise to such increased costs or reductions, and of such Lender’s or
Agent’s intention to claim compensation thereof (except that, if such event
giving rise to such increased cots or reductions is retroactive, then the
six-month period referred to above shall be extended to include the period of
retroactive effect thereof). The Agent, such Issuing Bank or such Lender

 

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agrees to furnish to the Borrower a certificate setting forth the basis and
amount of each request by the Agentsuch Issuing Bank or such Lender for
compensation under this Section.  Absent manifest error, determinations by the
Agent, any Issuing Bank or any Lender of the effect of any Regulatory Change
shall be conclusive, provided that such determinations are made on a reasonable
basis and in good faith.

 

Section 5.2.  Suspension of LIBOR Loans and LIBOR Margin Loans.

Anything herein to the contrary notwithstanding, if, on or prior to the
determination of LIBOR for any Interest Period:

 

(a)the Agent reasonably determines (which determination shall be conclusive)
that by reason of circumstances affecting the relevant market, adequate and
reasonable means do not exist for ascertaining LIBOR for such Interest Period;
or

 

(b)the Agent reasonably determines (which determination shall be conclusive)
that LIBOR will not adequately and fairly reflect the cost to the Lenders of
making or maintaining LIBOR Loans for such Interest Period; or

 

(c)the Agent reasonably determines (which determination shall be conclusive)
that deposits are not being offered to banks in the applicable offshore
interbank market for such currency of the applicable amount and the Interest
Period of such LIBOR Loan; or

 

(d)any Lender that has outstanding a Bid Rate Quote with respect to a LIBOR
Margin Loan reasonably determines (which determination shall be conclusive) that
LIBOR will not adequately and fairly reflect the cost to such Lender of making
or maintaining such LIBOR Margin Loan;

 

then the Agent shall give the Borrower and each Lender prompt notice thereof
and, so long as such condition remains in effect, (x) in the case of clauses (a)
and (b), the Lenders shall be under no obligation to, and shall not, make
additional LIBOR Loans, Continue LIBOR Loans or Convert Loans into LIBOR Loans
and the Borrower shall, on the last day of each current Interest Period for each
outstanding LIBOR Loan, either repay such Loan or Convert such Loan into a Base
Rate Loan, and (y) in the case of clause (c) above, no Lender that has
outstanding a Bid Rate Quote with respect to a LIBOR Margin Loan shall be under
any obligation to make such Loan.

 

Section 5.3.  Illegality.

Notwithstanding any other provision of this Agreement, if it becomes unlawful
for any Lender to honor its obligation to make or maintain LIBOR Loans hereunder
and/or if any Lender that has an outstanding Bid Rate Quote shall determine that
it is unlawful for such Lender to honor its obligation to make or maintain LIBOR
Margin Loans hereunder, then such Lender shall promptly notify the Borrower
thereof (with a copy to the Agent) and such Lender’s obligation to make or
Continue, or to Convert Loans of any other Type into, LIBOR Loans shall be
suspended and/or such Lender’s obligation to make LIBOR Margin Loans shall be
suspended,

 

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as applicable, until such time as such Lender may again make and maintain LIBOR
Loans (in which case the provisions of Section 5.5. shall be applicable).

 

Section 5.4.  Compensation.

The Borrower shall pay to the Agent for the account of a Lender, upon the
request of such Lender through the Agent, such amount or amounts as Agent shall
reasonably determine in its sole discretion to be sufficient to compensate such
Lender for any yield‑maintenance loss, cost or expense that the Agent determines
is attributable to:  (a) any payment or prepayment (whether mandatory or
optional) of a LIBOR Loan or a Bid Rate Loan, or Conversion of a LIBOR Loan,
made by such Lender for any reason (including, without limitation, acceleration)
on a date other than the last day of the Interest Period for such Loan; or (b)
any failure by the Borrower for any reason (including, without limitation, the
failure of any of the applicable conditions precedent specified in Article VI.
to be satisfied) to borrow a LIBOR Loan or a Bid Rate Loan from such Lender on
the date for such borrowing, or to Convert a Revolving Loan into a LIBOR Loan or
Continue a LIBOR Loan on the requested date of such Conversion or
Continuation.  Upon the Borrower’s request, the Agent shall provide the Borrower
with a statement setting forth in reasonable detail the basis for requesting
such compensation and the method for determining the amount thereof.  Any such
statement shall be conclusive absent manifest error, provided that such
determinations are made on a reasonable basis and in good faith.

 

Section 5.5.  Treatment of Affected Loans.

If the obligation of any Lender to make LIBOR Loans or to Continue, or to
Convert Base Rate Loans into, LIBOR Loans shall be suspended pursuant to
Section 5.1.(b), 5.2. or 5.3., then such Lender’s LIBOR Loans shall be
automatically Converted into Base Rate Loans on the last day(s) of the then
current Interest Period(s) for LIBOR Loans (or, in the case of a Conversion
required by Section 5.1.(b) or 5.3., on such earlier date as such Lender may
specify to the Borrower with a copy to the Agent) and, unless and until such
Lender gives notice as provided below that the circumstances specified in
Section 5.1., 5.2. or 5.3. that gave rise to such Conversion no longer exist:

 

(i)to the extent that such Lender’s LIBOR Loans have been so Converted, all
payments and prepayments of principal that would otherwise be applied to such
Lender’s LIBOR Loans shall be applied instead to its Base Rate Loans; and

 

(ii)all Loans that would otherwise be made or Continued by such Lender as LIBOR
Loans shall be made or Continued instead as Base Rate Loans, and all Base Rate
Loans of such Lender that would otherwise be Converted into LIBOR Loans shall
remain as Base Rate Loans.

 

If such Lender gives notice to the Borrower (with a copy to the Agent) that the
circumstances specified in Section 5.1. or 5.3. that gave rise to the Conversion
of such Lender’s LIBOR Loans pursuant to this Section no longer exist (which
such Lender agrees to do promptly upon such circumstances ceasing to exist) at a
time when LIBOR Loans made by other Lenders are outstanding, then such Lender’s
Base Rate Loans shall be automatically Converted, on the first

 

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day(s) of the next succeeding Interest Period(s) for such outstanding LIBOR
Loans, to the extent necessary so that, after giving effect thereto, all Loans
held by the Lenders holding LIBOR Loans and by such Lender are held pro rata (as
to principal amounts, Types and Interest Periods) in accordance with their
respective Commitments.

 

Section 5.6.  Affected Lenders.

If (a) a Lender requests compensation pursuant to Section 3.11. or 5.1., and the
Requisite Lenders are not also doing the same, (b) the obligation of any Lender
to make LIBOR Loans or to Continue, or to Convert Base Rate Loans into, LIBOR
Loans shall be suspended pursuant to Section 5.1.(b) or 5.3. but the obligation
of the Requisite Lenders shall not have been suspended under such Sections or
(c) a Lender does not vote in favor of any amendment, modification or waiver to
this Agreement which, pursuant to Section 12.1013.6. requires the vote of all of
the Lenders, and the Requisite Lenders shall have voted in favor of such
amendment, modification or waiver, then, so long as there does not then exist
any Default or Event of Default, the Borrower may either (i) demand that such
Lender (the “Affected Lender”), and upon such demand the Affected Lender shall
promptly, assign its Commitments to an Eligible Assignee subject to and in
accordance with the provisions of Section 13.5.(d) for a purchase price equal to
the aggregate principal balance of Loans then owing to the Affected Lender plus
any accrued but unpaid interest thereon and accrued but unpaid fees owing to the
Affected Lender, or (ii) pay to the Affected Lender the aggregate principal
balance of Loans then owing to the Affected Lender plus any accrued but unpaid
interest thereon and accrued but unpaid fees owing to the Affected Lender or any
other amount as may be mutually agreed upon by such Affected Lender and Eligible
Assignee, whereupon the Affected Lender shall no longer be a party hereto or
have any rights or obligations hereunder or under any of the other Loan
Documents.  Each of the Agent and the Affected Lender shall reasonably cooperate
in effectuating the replacement of such Affected Lender under this Section, but
at no time shall the Agent, such Affected Lender nor any other Lender be
obligated in any way whatsoever to initiate any such replacement or to assist in
finding an Eligible Assignee.  The exercise by the Borrower of its rights under
this Section shall be at the Borrower’s sole cost and expenses and at no cost or
expense to the Agent, the Affected Lender or any of the other Lenders; provided,
however, the Borrower shall not be obligated to reimburse or otherwise pay an
Affected Lender’s administrative or legal costs incurred as a result of the
Borrower’s exercise of its rights under this Section.  The terms of this Section
shall not in any way limit the Borrower’s obligation to pay to any Affected
Lender compensation owing to such Affected Lender pursuant to Section 3.11. or
5.1.

 

Section 5.7.  Change of Lending Office.

Each Lender agrees that it will use reasonable efforts (consistent with its
internal policy and legal and regulatory restrictions) to designate an alternate
Lending Office with respect to any of its Loans affected by the matters or
circumstances described in Sections 3.11., 5.1. or 5.3. to reduce the liability
of the Borrower or avoid the results provided thereunder, so long as such
designation is not disadvantageous to such Lender as determined by such Lender
in its sole discretion, except that such Lender shall have no obligation to
designate a Lending Office located in the United States of America.

 

 

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Section 5.8.  Assumptions Concerning Funding of LIBOR Loans.

Calculation of all amounts payable to a Lender under this Article V. shall be
made as though such Lender had actually funded LIBOR Loans through the purchase
of deposits in the relevant market bearing interest at the rate applicable to
such LIBOR Loans in an amount equal to the amount of the LIBOR Loans and having
a maturity comparable to the relevant Interest Period; provided, however, that
each Lender may fund each of its LIBOR Loans in any manner it sees fit and the
foregoing assumption shall be used only for calculation of amounts payable under
this Article V.

 

Article VI. Conditions Precedent

Section 6.1.  Initial Conditions Precedent.

The obligation of the Lenders to effect or permit the occurrence of the first
Credit Event hereunder, whether as the making of a Loan or the issuance of a
Letter of Credit, is subject to the following conditions precedent:

 

(a)The Agent shall have received each of the following, in form and substance
satisfactory to the Agent:

 

(i)counterparts of this Agreement executed by each of the parties hereto;

 

(ii)Revolving Notes payable to each Lender that was not a party to the Existing
Credit Agreement and to each Lender that was party to the Existing Credit
Agreement that is changing the amount of its Commitment, Bid Rate Notes executed
by the Borrower payable to each Lender, and the Swingline Note executed by the
Borrower;

 

(iii)a Guaranty executed by each of the Borrower’s Subsidiaries and
Unconsolidated Affiliates initially required to be a party thereto pursuant to
Section 8.14.;

 

(iv)an opinion of Stephanie G. Heim, Vice President, Corporate Counsel and
Secretary of the Borrower and the other Loan Parties regarding those matters
covered in the opinion delivered in connection with the Existing Credit
Agreement, and addressed to the Agent and the Lenders, and an opinion of an
outside law firm that is counsel to the Borrower and the other Loan Parties,
regarding those matters covered in the opinion delivered in connection with the
Existing Credit Agreement but not including any opinion with respect to usury
laws, and addressed to the Agent and the Lenders;

 

(v)the articles of incorporation of the Borrower certified as of a recent date
by the Secretary of State of the State of formation of such Person;

 

(vi)a certificate of good standing (or certificate of similar meaning) with
respect to the Borrower issued as of a recent date by the Secretary of State of
the State of formation of the Borrower and of each state in which the Borrower
owns Properties and is required to be qualified to transact business and where
failure to be so qualified could reasonably be expected to have a Material
Adverse Effect;

 

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(vii)a certificate of incumbency signed by the Secretary or Assistant Secretary
(or other individual performing similar functions) of each Loan Party with
respect to each of the officers of such Person authorized to execute and deliver
the Loan Documents to which such Person is a party, and in the case of the
Borrower, authorized to execute and deliver on behalf of the Borrower Notices of
Borrowing, Notices of Swingline Borrowing, requests for Letters of Credit,
Notices of Conversion, Notices of Continuation, Bid Rate Quote Requests and
notices of acceptance of Bid Rate Quotes;

 

(viii)copies certified by the Secretary or Assistant Secretary of the Borrower
(or other individual performing similar functions) of (i) the by-laws of such
Person and (ii) all corporate action taken by such Person to authorize the
execution, delivery and performance of the Loan Documents to which it is a
party;

 

(ix)a Compliance Certificate calculated on a pro forma basis for the Borrower’s
fiscal year ended December 31, 2011;

 

(x)all tax forms and other documents required to be provided by a Lender under
Section 3.11.; and

 

(xi)such other documents and instruments as the Agent, or any Lender through the
Agent, may reasonably request; and

 

(b)In the good faith judgment of the Agent:

 

(i)There shall not have occurred or become known to the Agent or the Lenders any
event, condition, situation or status since the date of the information
contained in the financial and business projections, budgets, pro forma data and
forecasts concerning the Borrower and its Subsidiaries delivered to the Agent
and the Lenders prior to the Agreement Date that has had or could reasonably be
expected to result in a Material Adverse Effect;

 

(ii)No litigation, action, suit, investigation or other arbitral, administrative
or judicial proceeding shall be pending or threatened which could reasonably be
expected to (A) result in a Material Adverse Effect or (B) restrain or enjoin,
impose materially burdensome conditions on, or otherwise materially and
adversely affect the ability of any Loan Party to fulfill its obligations under
the Loan Documents to which it is a party;

 

(iii)The Borrower and the other Loan Parties shall have received all approvals,
consents and waivers, and shall have made or given all necessary filings and
notices as shall be required to consummate the transactions contemplated hereby
without the occurrence of any default under, conflict with or violation of
(A) any Applicable Law or (B) any agreement, document or instrument to which any
Loan Party is a party or by which any of them or their respective properties is
bound, except for such approvals, consents, waivers, filings and notices the
receipt, making or giving of which, or the failure to make, give or receive
which, would not reasonably be likely to (1) have a

 

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Material Adverse Effect, or (2) restrain or enjoin, impose materially burdensome
conditions on, or otherwise materially and adversely affect the ability of the
Borrower or any other Loan Party to fulfill its obligations under the Loan
Documents to which it is a party; and

 

(iv)There shall not have occurred or exist any other material disruption of
financial or capital markets that could reasonably be expected to materially and
adversely affect the transactions contemplated by the Loan Documents.

 

Section 6.2.  Conditions Precedent to All Loans and Letters of Credit.

The obligation of the Lenders to make any Loans and of the AgentIssuing Banks to
issue Letters of Credit is subject to the further condition precedent that:
(a) no Default or Event of Default shall exist as of the date of the making of
such Loan or date of issuance of such Letter of Credit or would exist
immediately after giving effect thereto, and none of the conditions described in
Section 2.18. would exist after giving effect thereto; (b) the representations
and warranties made or deemed made by the Borrower and each other Loan Party in
the Loan Documents to which any of them is a party, shall be true and correct in
all material respects on and as of the date of the making of such Loan or date
of issuance of such Letter of Credit with the same force and effect as if made
on and as of such date except to the extent that such representations and
warranties expressly relate solely to an earlier date (in which case such
representations and warranties shall have been true and accurate in all material
respects on and as of such earlier date) and except for changes in factual
circumstances specifically and expressly permitted hereunder and (c) except as
otherwise provided herein, in the case of the borrowing of Loans (other than Bid
Rate Loans), the Borrower shall have delivered a timely Notice of Borrowing or
Notice of Swingline Borrowing, as the case may be.  Each Credit Event shall
constitute a certification by the Borrower to the effect set forth in the
preceding sentence (both as of the date of the giving of notice relating to such
Credit Event and, unless the Borrower otherwise notifies the Agent prior to the
date of such Credit Event, as of the date of the occurrence of such Credit
Event).  In addition, the Borrower shall be deemed to have represented to the
Agent, the Issuing Banks and the LenderLenders at the time such Loan is made or
such Letter of Credit is issued that all conditions to the making of such Loan
or issuing of such Letter of Credit contained in Article VI. have been
satisfied.

 

Section 6.3. [Intentionally Omitted]. 

Section 6.4.  Conditions as Covenants.

If the Lenders effect or permit the occurrence of the first Credit Event
hereunder, whether the making of a Loan or the issuance of a Letter of Credit,
prior to the satisfaction of all conditions precedent set forth in Sections 6.1.
and 6.2., the Borrower shall nevertheless cause such condition or conditions to
be satisfied within 5 Business Days after the date of the making of such Loans
or the issuance of such Letter of Credit.  Unless set forth in writing to the
contrary, the making of its initial Loan by a Lender shall constitute a
confirmation by such Lender to the Agent, the Issuing Banks and the other
Lenders that insofar as such Lender is concerned the Borrower has satisfied the
conditions precedent for initial Loans set forth in Sections 6.1. and 6.2.

 

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Article VII. Representations and Warranties

Section 7.1.  Representations and Warranties.

In order to induce the Agent and each Lender to enter into this Agreement and to
make Loans and, in the case of the AgentIssuing Banks, to issue Letters of
Credit, and, in the case of the Lenders, to acquire participations in Letters of
Credit, the Borrower represents and warrants to the Agent, the Issuing Banks and
each Lender as follows:

 

(a)Organization; Power; Qualification.  Each of the Loan Parties and the other
Subsidiaries is a corporation, partnership or other legal entity, duly organized
or formed, validly existing and in good standing under the jurisdiction of its
incorporation or formation, has the power and authority to own or lease its
respective properties and to carry on its respective business as now being and
hereafter proposed to be conducted and is duly qualified and is in good standing
as a foreign corporation, partnership or other legal entity, and authorized to
do business, in each jurisdiction in which the character of its properties or
the nature of its business requires such qualification or authorization and
where the failure to be so qualified or authorized could reasonably be expected
to have, in each instance, a Material Adverse Effect.

 

(b)Ownership Structure.  Part I of Schedule 7.1.(b) is, as of the Agreement
Date, a complete and correct list of all Subsidiaries of the Borrower, setting
forth for each such Subsidiary, (i) the type of legal entity which such
Subsidiary is and (ii) the jurisdiction of organization of such
Subsidiary.  Part II of Schedule 7.1.(b) correctly sets forth, as of the
Agreement Date, all Unconsolidated Affiliates of the Borrower, including the
correct legal name of such Person, the type of legal entity which each such
Person is, and the jurisdiction of organization of such Person. 

 

(c)Authorization of Agreement, Notes, Loan Documents and Borrowings.  The
Borrower has the right and power, and has taken all necessary action to
authorize it, to borrow hereunder.  The Borrower and each other Loan Party has
the right and power, and has taken all necessary action to authorize it, to
execute, deliver and perform each of the Loan Documents to which it is a party
in accordance with their respective terms and to consummate the transactions
contemplated hereby and thereby.  The Loan Documents to which the Borrower or
any other Loan Party is a party have been duly executed and delivered by the
duly authorized officers of such Person and each is a legal, valid and binding
obligation of such Person enforceable against such Person in accordance with its
respective terms, except as the same may be limited by bankruptcy, insolvency,
and other similar laws affecting the rights of creditors generally and the
availability of equitable remedies for the enforcement of certain obligations
contained herein or therein may be limited by equitable principles generally.

 

(d)Compliance of Agreement, Etc. with Laws.  The execution, delivery and
performance of this Agreement and the other Loan Documents to which the Borrower
or any other Loan Party is a party in accordance with their respective terms and
the borrowings hereunder do not and will not, by the passage of time, the giving
of notice, or both:  (i) require any Governmental Approval or violate any
Applicable Law (including all Environmental Laws) relating to the Borrower or
any other Loan Party; (ii) conflict with, result in a breach of or

 

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constitute a default under the Borrower’s articles of incorporation or bylaws
(including without limitation, Section 2 of Article IV and Section 2(a) of
Article VIII of the Borrower’s bylaws), or any resolution adopted by the
Borrower’s Board of DirectorsTrustees in connection with the designation of any
series of Preferred Stock of the Borrower, or the organizational documents of
any other Loan Party, or any indenture, agreement or other instrument to which
the Borrower or any other Loan Party is a party or by which it or any of its
respective properties may be bound; or (iii) result in or require the creation
or imposition of any Lien upon or with respect to any property now owned or
hereafter acquired by the Borrower or any other Loan Party other than in favor
of the Agent for the benefit of the Lenders.

 

(e)Compliance with Law; Governmental Approvals.  The Borrower, each other Loan
Party and each other Subsidiary is in compliance with each Governmental Approval
and all other Applicable Laws relating to it except for noncompliances which,
and Governmental Approvals the failure to possess which, could not, individually
or in the aggregate, reasonably be expected to cause a Default or Event of
Default or have a Material Adverse Effect.

 

(f)Title to Properties.  Each of the Borrower and the other Loan Parties and all
other Subsidiaries has good, marketable and legal title to, or a valid leasehold
interest in, its respective material assets. 

 

(g)Existing Indebtedness.  Schedule 7.1.(g) is, as of December 31, 2011, a
complete and correct listing of any Indebtedness of the Borrower, its
Subsidiaries and all of its Unconsolidated Affiliates having an outstanding
principal balance of $5,000,000 or more. 

 

(h)[Intentionally Omitted].

 

(i)Litigation.  Except as disclosed in writing to the Agent and the Lenders or
as disclosed in the borrower’sBorrower’s periodic filings with the SEC, there
are no actions, suits or proceedings pending (nor, to the knowledge of the
Borrower, are there any actions, suits or proceedings threatened, nor is there
any basis therefor) against or in any other way relating adversely to or
affecting the Borrower, any other Loan Party, any other Subsidiary or any of
their respective property in any court or before any arbitrator of any kind or
before or by any other Governmental Authority which, if adversely determined,
could reasonably be expected to have a Material Adverse Effect.  There are no
strikes, slow downs, work stoppages or walkouts or other labor disputes in
progress or threatened relating to the Borrower, any other Loan Party or any
other Subsidiary which could reasonably be expected to have a Material Adverse
Effect.

 

(j)Taxes.  All federal, material state and other material tax returns of the
Borrower, each other Loan Party and each other Subsidiary required by Applicable
Law to be filed have been duly filed, and all federal, state and other material
taxes, assessments and other governmental charges or levies upon the Borrower,
each other Loan Party and each other Subsidiary and their respective properties,
income, profits and assets which are due and payable have been paid, except any
such nonpayment which is at the time permitted under Section 8.6.  As of the
Agreement Date, none of the United States income tax returns of the Borrower,
any other Loan Party or any other Subsidiary is under audit.  All charges,
accruals and reserves on

 

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the books of the Borrower and each of its Subsidiaries in respect of any taxes
or other governmental charges are in accordance with GAAP in all material
respects.

 

(k)Financial Statements.  The Borrower has furnished to each Lender copies of
the audited consolidated balance sheet of the Borrower and its Subsidiaries for
the fiscal years ended December 31, 2010 and December 31, 2011 and the related
consolidated statements of operations, stockholders’ equity and cash flow for
the fiscal years ended on such dates, with the opinion thereon of Ernst & Young
LLP.  Such balance sheets and statements (including in each case related
schedules and notes) present fairly, in all material respects, the consolidated
financial position of the Borrower and its Subsidiaries as at their respective
dates and the results of operations and the cash flow for such periods (subject,
as to interim statements, to changes resulting from normal year‑end audit
adjustments) in conformity with GAAP.  Neither the Borrower nor any of its
Subsidiaries has on the Agreement Date any material contingent liabilities,
liabilities, liabilities for taxes, unusual or long-term commitments or
unrealized or forward anticipated losses from any unfavorable commitments,
except as referred to or reflected or provided for in said financial
statements. 

 

(l)No Material Adverse Change.  Since December 31, 2010, there has been no
material adverse change in the consolidated financial condition, results of
operations, business or prospects of the Borrower and its Subsidiaries taken as
a whole.  Each of the Borrower and the other Loan Parties is Solvent.

 

(m)ERISA.  Each member of the ERISA Group has fulfilled its obligations under
the minimum funding standards of ERISA and the Internal Revenue Code with
respect to each Plan and is in compliance in all material respects with the
presently applicable provisions of ERISA and the Internal Revenue Code with
respect to each Plan.  No member of the ERISA Group has (i) sought a waiver of
the minimum funding standard under Section 412 of the Internal Revenue Code in
respect of any Plan, (ii) failed to make any contribution or payment to any Plan
or Multiemployer Plan or in respect of any Benefit Arrangement, or made any
amendment to any Plan or Benefit Arrangement, which has resulted or could result
in the imposition of a Lien or the posting of a bond or other security under
ERISA or the Internal Revenue Code or (iii) incurred any liability under Title
IV of ERISA other than a liability to the PBGC for premiums under Section 4007
of ERISA.

 

(n)Absence of Defaults.  None of the Borrower, the other Loan Parties or the
other Subsidiaries is in default under its articles of incorporation, bylaws,
partnership agreement or other similar organizational documents, and no event
has occurred, which has not been remedied, cured or waived:  (i) which
constitutes a Default or an Event of Default; or (ii) which constitutes, or
which with the passage of time, the giving of notice, or both, would constitute,
a default or event of default by the Borrower, any other Loan Party or any other
Subsidiary under any agreement (other than this Agreement) or judgment, decree
or order to which any such Person is a party or by which any such Person or any
of its respective properties may be bound where such default or event of default
could, individually or in the aggregate, have a Material Adverse Effect.

 

 

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(o)Environmental Laws.  In the ordinary course of business and from time to time
each of the Loan Parties and the other Subsidiaries conducts reviews of the
effect of Environmental Laws on its respective business, operations and
properties, including without limitation, its respective Properties, in the
course of which such Loan Party or such Subsidiary identifies and evaluates
associated liabilities and costs (including, without limitation, determining
whether any capital or operating expenditures are required for clean-up or
closure of properties presently or previously owned, determining whether any
capital or operating expenditures are required to achieve or maintain compliance
in all material respects with Environmental Laws or required as a condition of
any Governmental Approval, any contract, or any related constraints on operating
activities, determining whether any costs or liabilities exist in connection
with off-site disposal of wastes or Hazardous Materials, and determining whether
any actual or potential liabilities to third parties, including employees, and
any related costs and expenses exist).  Each of the Loan Parties and the other
Subsidiaries is in compliance with all applicable Environmental Laws and has
obtained all Governmental Approvals which are required under Environmental Laws
and is in compliance with all terms and conditions of such Governmental
Approvals, where with respect to each of the foregoing the failure to obtain or
to comply with could be reasonably expected to have a Material Adverse
Effect.  Except for any of the following matters that could not be reasonably
expected to have a Material Adverse Effect, the Borrower is not aware of, nor
has either received notice of, any past or present events, conditions,
circumstances, activities, practices, incidents, actions, or plans which, with
respect to any Loan Party or any other Subsidiary, may unreasonably interfere
with or prevent compliance or continued compliance with Environmental Laws, or
may give rise to any common‑law or legal liability, based on or related to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling or the emission, discharge, release or threatened release
into the environment, of any Hazardous Material.  There is no civil, criminal,
or administrative action, suit, demand, claim, hearing, notice, or demand
letter, notice of violation, investigation, or proceeding pending or, to the
Borrower’s knowledge after due inquiry, threatened, against any Loan Party or
any other Subsidiary relating in any way to Environmental Laws which, if
determined adversely to such Loan Party or Subsidiary, could be reasonably
expected to have a Material Adverse Effect.

 

(p)Investment Company; Etc.  Neither the Borrower, any other Loan Party, nor any
other Subsidiary is (i) an “investment company” or a company “controlled” by an
“investment company” within the meaning of the Investment Company Act of 1940,
as amended, or (ii) subject to any other Applicable Law which purports to
regulate or restrict its ability to borrow money or to consummate the
transactions contemplated by this Agreement or to perform its obligations under
any Loan Document to which it is a party.

 

(q)Margin Stock.  None of the Borrower, any other Loan Party nor any other
Subsidiary is engaged principally, or as one of its important activities, in the
business of extending credit for the purpose, whether immediate, incidental or
ultimate, of buying or carrying “margin stock” within the meaning of
Regulation U of the Board of Governors of the Federal Reserve System.

 

 

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(r)Affiliate Transactions.  Except as permitted by Section 10.9., none of the
Borrower, any other Loan Party nor any other Subsidiary is a party to or bound
by any agreement or arrangement (whether oral or written) with any Affiliate.

 

(s)Intellectual Property.  The Borrower and each Subsidiary owns or has the
right to use, under valid license agreements or otherwise, all patents,
licenses, franchises, trademarks, trademark rights, trade names, trade name
rights, trade secrets and copyrights (collectively, “Intellectual Property”)
material to the conduct of its businesses, without known conflict with any
patent, license, franchise, trademark, trade secret, trade name, copyright, or
other proprietary right of any other Person.  All such Intellectual Property is
fully protected and/or duly and properly registered, filed or issued in the
appropriate office and jurisdictions for such registrations, filing or
issuances.  No material claim has been asserted by any Person with respect to
the use of any such Intellectual Property, or challenging or questioning the
validity or effectiveness of any such Intellectual Property.

 

(t)Business.  As of the Agreement Date, the principal business activities of the
Borrower and its Subsidiaries are the acquisition, development, ownership and
operation of storage facilities which offer storage spaces, usually on a
month-to-month basis, for personal and business use and related activities. 

 

(u)Broker’s Fees.  Except for the various fees payable to the Agent and the
Lenders in connection with the Loan Documents, no broker’s or finder’s fee,
commission or similar compensation will be payable with respect to the
transactions contemplated hereby.  No other similar fees or commissions will be
payable by any Loan Party for any other services rendered to the Borrower or any
of its Subsidiaries ancillary to the transactions contemplated hereby.

 

(v)Not Plan Assets; No Prohibited Transactions.  None of the assets of any Loan
Party or any other Subsidiary constitutes “plan assets” within the meaning of
ERISA, the Internal Revenue Code and the respective regulations promulgated
thereunder, of any ERISA Plan.  The execution, delivery and performance of the
Loan Documents by the Loan Parties, and the borrowing and repayment of amounts
thereunder, do not and will not constitute “prohibited transactions” under ERISA
or the Internal Revenue Code.

 

(w)[Intentionally Omitted]. 

 

(x)Accuracy and Completeness of Information.  All written information, reports
and other papers and data (excluding financial projections) furnished to the
Agent or any Lender by, on behalf of, or at the direction of, the Borrower, any
other Loan Party or any other Subsidiary were, at the time the same were so
furnished, complete and correct in all material respects or, in the case of
financial statements, present fairly, in all material respects, the financial
position of the Borrower and its consolidated subsidiaries as at the date
thereof and the results of operations for such periods (subject, as to interim
statements, to changes resulting from normal year‑end audit adjustments) in
conformity with GAAP.  No fact is known to the Borrower which has had, as of the
Effective Date, or may in the future have (so far as the Borrower can reasonably
foresee), a Material Adverse Effect which has not been set forth in the
financial statements

 

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referred to in Section 7.1.(k) or in such information, reports or other papers
or data or otherwise disclosed in writing to the Agent and the Lenders
(excluding financial projections or as otherwise agreed) prior to the Effective
Date.  All financial projections have been prepared in good faith based on
reasonable assumptions (it being understood that assumptions as to future
results are inherently subject to uncertainty and contingencies, many of which
are beyond the control of the Borrower, any other Loan Party or any other
Subsidiary and that no assurance can be given that any particular projections
will be realized).  No document furnished or written statement made to the Agent
or any Lender in connection with the negotiation, preparation or execution of
this Agreement or any of the other Loan Documents contains or will contain any
untrue statement of a fact material to the creditworthiness of the Borrower, any
other Loan Party or any other Subsidiary or omits or will omit to state a
material fact necessary in order to make the statements contained therein not
misleading in light of the circumstances under which they were made.

(y)OFAC.  None of the Borrower, any of the other Loan Parties, any of the other
Subsidiaries, or any other Affiliate of the Borrower: (i) is a person named on
the list of Specially Designated Nationals or Blocked Persons maintained by the
U.S. Department of the Treasury’s Office of Foreign Assets Control (“OFAC”)
available at http://www.treas.gov/offices/enforcement/ofac/index.shtml, or as
otherwise published from time to time; (ii) is (A) an agency of the government
of a country, (B) an organization controlled by a country, or (C) a person
resident in a country that is subject to a sanctions program identified on the
list maintained by OFAC and available at
http://www.treas.gov/offices/enforcement/ofac/index.shtml, or as otherwise
published from time to time, as such program may be applicable to such agency,
organization or person; or (iii) derives any of its assets or operating income
from investments in or transactions with any such country, agency, organization
or person; and none of the proceeds from the Loan will be used to finance any
operations, investments or activities in, or make any payments to, any such
country, agency, organization, or person.

(z)REIT Status.  For the fiscal year ended December 31, 2014, the Borrower
qualified as a REIT and intends to continue to qualify as a REIT.

 

Section 7.2.  Survival of Representations and Warranties, Etc.

All statements contained in any certificate, financial statement or other
instrument delivered by or on behalf of the Borrower, any other Loan Party or
any other Subsidiary to the Agent or any Lender pursuant to or in connection
with this Agreement or any of the other Loan Documents (including, but not
limited to, any such statement made in or in connection with any amendment
thereto or any statement contained in any certificate, financial statement or
other instrument delivered by or on behalf of the Borrower prior to the
Agreement Date and delivered to the Agent or any Lender in connection with
closing the transactions contemplated hereby) shall constitute representations
and warranties made by the Borrower under this Agreement.  All representations
and warranties made under this Agreement and the other Loan Documents shall be
deemed to be made at and as of the Agreement Date, the Effective Date and at and
as of the date of the occurrence of any Credit Event, except to the extent that
such representations and warranties expressly relate solely to an earlier date
(in which case such representations and warranties shall have been true and
accurate on and as of such earlier date) and except for changes in factual
circumstances specifically permitted hereunder.  All such representations and

 

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warranties shall survive the effectiveness of this Agreement, the execution and
delivery of the Loan Documents and the making of the Loans and the issuance of
the Letters of Credit.

 

Article VIII. Affirmative Covenants

For so long as this Agreement is in effect, unless the Requisite Lenders (or, if
required pursuant to Section 13.6., all of the Lenders) shall otherwise consent
in the manner provided for in Section 13.6., the Borrower shall comply with the
following covenants:

 

Section 8.1.  Preservation of Existence and Similar Matters.

Except as otherwise permitted under Section 10.5., the Borrower shall, and shall
cause each other Loan Party and each other Subsidiary to, (i) preserve and
maintain its respective existence, in the jurisdiction of its incorporation or
formation, (ii) preserve and maintain its respective rights, franchises,
licenses and privileges in the jurisdiction of its incorporation or formation
and, except where the failure to preserve and maintain such rights, franchises,
licenses and privileges could not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect and (iii) qualify and remain
qualified and authorized to do business in each jurisdiction in which the
character of its properties or the nature of its business requires such
qualification and authorization and, except where the failure to be so
authorized and qualified could not reasonably be expected to have, individually
or in the aggregate, a Material Adverse Effect.

 

Section 8.2.  Compliance with Applicable Law.

The Borrower shall, and shall cause each other Loan Party and each other
Subsidiary to, comply with all Applicable Law, including the obtaining of all
Governmental Approvals, the failure with which to comply could reasonably be
expected to have a Material Adverse Effect.

 

Section 8.3.  Maintenance of Property.

In addition to the requirements of any of the other Loan Documents, the Borrower
shall, and shall cause each other Loan Party and each other Subsidiary to,
(a) protect and preserve all of its material properties, including, but not
limited to, all Intellectual Property, and maintain in good repair, working
order and condition all material tangible properties, ordinary wear and tear
excepted, and (b) from time to time make or cause to be made all needed and
appropriate repairs, renewals, replacements and additions to such properties, so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times in all material respects.

 

Section 8.4.  Conduct of Business.

The Borrower shall, and shall cause the other Loan Parties and each other
Subsidiary to, carry on its respective businesses as described in
Section 7.1.(t) and not enter into any line of business not otherwise engaged in
by any such Person as of the Agreement Date except (a) for lines of business
incidental or related thereto and (b) other lines of business so long as the
Investment in such lines of business is permitted under Section 10.1.(j).

 

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Section 8.5.  Insurance.

The Borrower shall, and shall cause each Subsidiary to, maintain insurance with
financially sound and reputable insurance companies against such risks and in
such amounts as is customarily maintained by similar businesses or as may be
required by Applicable Law. The Borrower shall from time to time deliver to the
Agent upon request a detailed list, together with copies of all policies of the
insurance then in effect if requested, stating the names of the insurance
companies, the amounts and rates of the insurance, the dates of the expiration
thereof and the properties and risks covered thereby.

 

Section 8.6.  Payment of Taxes and Claims.

The Borrower shall, and shall cause each other Loan Party and each other
Subsidiary to, pay and discharge when due (a) all material taxes, assessments
and governmental charges or levies imposed upon it or upon its income or profits
or upon any material properties belonging to it, and (b) all lawful and material
claims of materialmen, mechanics, carriers, warehousemen and landlords for
labor, materials, supplies and rentals which, if unpaid, might become a Lien on
any material properties of such Person; provided, however, that this Section
shall not require the payment or discharge of any such tax, assessment, charge,
levy or claim which is being contested in good faith by appropriate proceedings
which operate to suspend the collection thereof and for which adequate reserves
have been established on the books of such Person in accordance with GAAP.

 

Section 8.7.  Books and Records; Inspections.

The Borrower shall, and shall cause each other Loan Party and each other
Subsidiary to, keep proper books of record and account in which full, true and
correct entries in all material respects shall be made of all dealings and
transactions in relation to its respective business and activities.  The
Borrower shall, and shall cause each other Loan Party and each other Subsidiary
to, permit representatives of the Agent or any Lender to visit and inspect any
of their respective properties, to examine and make abstracts from any of their
respective books and records and to discuss their respective affairs, finances
and accounts with their respective officers, employees and independent public
accountants (in the Borrower’s presence if an Event of Default does not then
exist), all at such reasonable times during business hours and as often as may
reasonably be requested and so long as no Event of Default exists, with
reasonable prior notice and, at any time while an Event of Default exists, all
at the Borrower’s sole cost and expense.

 

Section 8.8.  Use of Proceeds.

The Borrower shall use the proceeds of Loans only (a) for the payment of
pre-development and development costs incurred in connection with Properties
owned by the Borrower or any Subsidiary; (b) to finance acquisitions otherwise
permitted under this Agreement; (c) to finance capital expenditures and the
repayment of Indebtedness of the Borrower and its Subsidiaries; and (d) to
provide for the general working capital needs of the Borrower and its
Subsidiaries and for other general corporate purposes of the Borrower and its
Subsidiaries, including redemptions or repurchases of Equity Interests of the
Borrower and its

 

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Subsidiaries permitted under this Agreement.  The Borrower shall only use
Letters of Credit for the same purposes for which it may use the proceeds of
Loans.  The Borrower shall not, and shall not permit any Subsidiary to, use any
part of such proceeds to purchase or carry, or to reduce or retire or refinance
any credit incurred to purchase or carry, any margin stock (within the meaning
of Regulation U of the Board of Governors of the Federal Reserve System) or to
extend credit to others for the purpose of purchasing or carrying any such
margin stock if, in any such case, such use might result in any of the Loans
being consider to be “purpose credit” directly or indirectly secured by margin
stock within the meaning of Regulation U or Regulation X of the Board of
Governors of the Federal Reserve System.

 

Section 8.9.  Environmental Matters.

The Borrower shall, and shall cause each other Loan Party and each other
Subsidiary to, comply with all Environmental Laws the failure with which to
comply could reasonably be expected to have a Material Adverse Effect.  If the
Borrower, any other Loan Party or any other Subsidiary shall (a) receive notice
that any violation of any Environmental Law may have been committed or is about
to be committed by such Person, (b) receive notice that any administrative or
judicial complaint or order has been filed or is about to be filed against any
such Person alleging violations of any Environmental Law or requiring any such
Person to take any action in connection with the release of Hazardous Materials
or (c) receive any notice from a Governmental Authority or private party
alleging that any such Person may be liable or responsible for costs associated
with a response to or cleanup of a release of Hazardous Materials or any damages
caused thereby, and the matters covered by such notices, individually or in the
aggregate, could reasonably be expected to have a Material Adverse Effect, the
Borrower shall provide the Agent with a copy of such notice within 10 days after
the receipt thereof by the Borrower, such other Loan Party or such other
Subsidiary.  The Borrower shall, and shall cause each other Loan Party and each
other Subsidiary to, promptly take all actions necessary to prevent the
imposition of any Liens on any of their respective properties arising out of or
related to any Environmental Laws.

 

Section 8.10.  Further Assurances.

At the Borrower’s cost and expense and upon request of the Agent, the Borrower
shall duly execute and deliver or cause to be duly executed and delivered, to
the Agent such further instruments, documents and certificates, and do and cause
to be done such further acts that may be reasonably necessary or advisable in
the reasonable opinion of the Agent to carry out more effectively the provisions
and purposes of this Agreement and the other Loan Documents.

 

Section 8.11.  [Intentionally Omitted].

Section 8.12.  REIT Status[Intentionally Omitted].

The Borrower shall maintain its status as a REIT.

 

 

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Section 8.13.  Exchange Listing.

The Borrower shall maintain at least one class of common shares of the Borrower
having trading privileges on the New York Stock Exchange or the American Stock
Exchange or which is subject to price quotations on The NASDAQ Stock Market’s
National Market System.

 

Section 8.14.  Guarantors; Release of Guarantors.[Intentionally Omitted] 

(a)Generally.  The Borrower shall cause any Subsidiary and any Unconsolidated
Affiliate that is not already a Guarantor and to which any of the following
conditions apply (each a “New Guarantor”) to execute and deliver to the Agent an
Accession Agreement, together with the other items required to be delivered
under the subsection (c) below:

 

(i)In the case of a Subsidiary, such Subsidiary is both a Material Subsidiary
and a Wholly Owned Subsidiary (other than any Subsidiary not incorporated under
the laws of any state of the United States or District of Columbia or any
Subsidiary primarily engaged in the business of providing re-insurance in
connection with persons who rent storage units from the Borrower or any of its
Subsidiaries); or

 

(ii)In the case of any Material Subsidiary, such Person shall Guarantee, or
otherwise become obligated in respect of, any Indebtedness of the Borrower, any
Subsidiary or any Non‑Guarantor Entity.

 

Any such Accession Agreement and the other items required under subsection (c)
below must be delivered to the Agent no later than the date the Borrower is
required to deliver financial statements under Section 9.1. for the fiscal
quarter (or Section 9.2. for the fourth fiscal quarter) during which any of the
above conditions first applies to a New Guarantor.

 

(b)Other Guarantors.  The Borrower may, at its option, cause any other Person
that is not already a Guarantor to become a Guarantor by causing such Person to
execute and deliver to the Agent an Accession Agreement, together with the other
items required to be delivered under the subsection (c) below.

 

(c)Required Deliveries.  Each Accession Agreement delivered by a New Guarantor
under the immediately preceding subsections (a) or (b) shall be accompanied by
each of the following in form and substance satisfactory to the Agent:

 

(i)a certificate of incumbency signed by the Secretary or Assistant Secretary
(or other individual performing similar functions) of such New Guarantor with
respect to each of the officers of such New Guarantor authorized to execute and
deliver the Loan Documents to which such New Guarantor is a party;

 

(ii)copies certified by the Secretary or Assistant Secretary (or other
individual performing similar functions) such New Guarantor of (A) the
certificate or articles of incorporation, articles of organization, certificate
of limited partnership, declaration of trust or other comparable organizational
instrument (if any) of such New Guarantor, (B) the by-laws of such new
Guarantor, if a corporation, the operating agreement, if a limited

 

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liability company, the partnership agreement, if a limited or general
partnership, or other comparable document in the case of any other form of legal
entity and (C) all corporate, partnership, member or other necessary action
taken by such New Guarantor to authorize the execution, delivery and performance
of the Loan Documents to which it is a party; and

 

(iii)such other documents and instruments as the Agent, or any Lender through
the Agent, may reasonably request.

 

(d)Release of Guarantor.  The Borrower may request in writing that the Agent
release, and upon receipt of such request the Agent shall release, a Guarantor
from its obligations under the Guaranty if, and only if: (i) such Guarantor is
not required to be a party to the Guaranty under this Section; and (ii) no
Default or Event of Default shall then be in existence or would occur as a
result of such release.

 

Article IX. Information

For so long as this Agreement is in effect, unless the Requisite Lenders (or, if
required pursuant to Section 13.6., all of the Lenders) shall otherwise consent
in the manner set forth in Section 13.6., the Borrower shall furnish to each
Lender (or to the Agent if so provided below) at its Lending Office:

 

Section 9.1.  Quarterly Financial Statements.

As soon as available and in any event within 50 days after the close of each of
the first, second and third fiscal quarters of the Borrower, the unaudited
consolidated balance sheet of the Borrower and its Subsidiaries as at the end of
such period and the related unaudited consolidated statements of income,
shareholders’ equity and cash flows of the Borrower and its Subsidiaries for
such period, setting forth in each case in comparative form the figures for the
corresponding periods of the previous fiscal year, all of which shall be
certified by the chief financial officer or other corporate officer of the
Borrower, in his or her opinion, to present fairly, in accordance with GAAP, the
consolidated financial position of the Borrower and its Subsidiaries as at the
date thereof and the results of operations for such period (subject to normal
year‑end audit adjustments).

 

Section 9.2.  Year‑End Statements.

As soon as available and in any event within 120 days after the end of each
fiscal year of the Borrower, the audited consolidated balance sheet of the
Borrower and its Subsidiaries as at the end of such fiscal year and the related
audited consolidated statements of income, shareholders’ equity and cash flows
of the Borrower and its Subsidiaries for such fiscal year, setting forth in
comparative form the figures as at the end of and for the previous fiscal year,
all of which shall be certified by (a) the chief financial officer or other
corporate officer of the Borrower, in his or her opinion, to present fairly, in
accordance with GAAP, the financial position of the Borrower and its
Subsidiaries as at the date thereof and the result of operations for such period
and (b) either (i) Ernst & Young LLP or (ii) any other independent certified
public accountants of recognized national standing acceptable to the Requisite
Lenders, whose

 

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certificate shall be unqualified and in scope and substance satisfactory to the
Requisite Lenders and who shall have authorized the Borrower to deliver such
financial statements and certification thereof to the Agent and the Lenders
pursuant to this Agreement.  Such financial statements shall be accompanied by a
statement of the accountants which reported on such statements indicating
whether anything has come to their attention to cause them to believe that any
Default or Event of Default existed on the date of such statements.

 

Section 9.3.  Compliance Certificate.

At the time the financial statements are furnished pursuant to Sections 9.1. and
9.2., a certificate substantially in the form of Exhibit K (a “Compliance
Certificate”) executed on behalf of the Borrower by the chief financial officer
or other corporate officer of the Borrower (a) setting forth as of the end of
such quarterly accounting period or fiscal year, as the case may be, the
calculations required to establish whether the Borrower was in compliance with
the covenants contained in Section 10.1.; and (b) stating that no Default or
Event of Default exists, or, if such is not the case, specifying such Default or
Event of Default and its nature, when it occurred and the steps being taken by
the Borrower with respect to such event, condition or failure.

 

Section 9.4.  Other Information.

(a)Credit Rating.  Prompt notice to the Agent of any change in the Borrower’s
Credit Rating;

 

(b)Securities Filings.  Within 5 Business Days of the filing thereof, copies of
all reports on Forms 10‑K, 10‑Q and 8‑K (or their equivalents) which the
Borrower, any other Loan Party or any other Subsidiary shall file with the
Securities and Exchange Commission (or any Governmental Authority substituted
therefor)SEC or any national securities exchange;

 

(c)Accountants’ Reports. Promptly upon receipt thereof, copies of all reports,
if any, submitted to the Borrower or its Board of DirectorsTrustees by its
independent public accountants including, without limitation, any management
report;

 

(d)Reports to Shareholders.  Promptly upon the mailing thereof to the
shareholders of the Borrower generally, copies of all financial statements,
reports and proxy statements so mailed;

 

(e)[Intentionally omitted].

 

(f)Budgets.  No later than November 30th of each calendar year, projected
balance sheets, income statements and cash flow budgets (including projected
sources and uses of funds) of the Borrower and its Subsidiaries on a
consolidated basis for each quarter of the next succeeding fiscal year, all
itemized in reasonable detail. The foregoing shall be accompanied by pro forma
calculations, together with detailed assumptions, required to establish whether
or not the Borrower will be in compliance with the covenants contained in
Sections 10.1. at the end of each fiscal quarter of the next succeeding fiscal
year;[Intentionally omitted].

 

 

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(g)ERISA.  If and when any member of the ERISA Group (i) gives or is required to
give notice to the PBGC of any “reportable event” (as defined in Section 4043 of
ERISA) with respect to any Plan which might constitute grounds for a termination
of such Plan under Title IV of ERISA, or knows that the plan administrator of
any Plan has given or is required to give notice of any such reportable event, a
copy of the notice of such reportable event given or required to be given to the
PBGC; (ii) receives notice of complete or partial withdrawal liability under
Title IV of ERISA or notice that any Multiemployer Plan is in reorganization, is
insolvent or has been terminated, a copy of such notice; (iii) receives notice
from the PBGC under Title IV of ERISA of an intent to terminate, impose
liability (other than for premiums under Section 4007 of ERISA) in respect of,
or appoint a trustee to administer any Plan, a copy of such notice; (iv) applies
for a waiver of the minimum funding standard under Section 412 of the Internal
Revenue Code, a copy of such application; (v) gives notice of intent to
terminate any Plan under Section 4041(c) of ERISA, a copy of such notice and
other information filed with the PBGC; (vi) gives notice of withdrawal from any
Plan pursuant to Section 4063 of ERISA, a copy of such notice; or (vii) fails to
make any payment or contribution to any Plan or Multiemployer Plan or in respect
of any Benefit Arrangement or makes any amendment to any Plan or Benefit
Arrangement which has resulted or could result in the imposition of a Lien or
the posting of a bond or other security, a certificate of the controller of the
Borrower setting forth details as to such occurrence and action, if any, which
the Borrower or applicable member of the ERISA Group is required or proposes to
take;

 

(h)Governmental Actions.  To the extent the Borrower or any Subsidiary is aware
of the same, prompt notice of the commencement of any proceeding or
investigation by or before any Governmental Authority and any action or
proceeding in any court or other tribunal or before any arbitrator against or in
any other way relating adversely to, or adversely affecting, the Borrower or any
Subsidiary or any of their respective properties, assets or businesses which, if
determined or resolved adversely to such Person, could reasonably be expected to
have a Material Adverse Effect, and prompt notice of the receipt of notice that
any United States income tax returns of the Borrower or any of its Subsidiaries
are being audited;

 

(i)Changes in Financial Condition, Etc.  Prompt notice of any change in the
business, assets, liabilities, financial condition, results of operations or
business prospects of the Borrower or any Subsidiary which in either event has
had or could reasonably be expected to have a Material Adverse Effect;

 

(j)Defaults.  Prompt notice of the occurrence of any Default or Event of Default
or any event which constitutes or which with the passage of time, the giving of
notice, or otherwise, would constitute a default or event of default by the
Borrower, any other Loan Party or any other Subsidiary under any Material
Contract to which any such Person is a party or by which any such Person or any
of its respective properties may be bound;

 

(k)Judgments, Etc.  Prompt notice of any order, judgment or decree in excess of
$50,000,000 having been entered against the Borrower, any other Loan Party or
any other Subsidiary or any of their respective properties or assets;

 

 

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(l)Ownership Share Calculation.  Promptly upon the request of the Agent,
evidence of the Borrower’s calculation of the Ownership Share with respect to a
Subsidiary or an Unconsolidated Affiliate, such evidence to be in form and
detail satisfactory to the Agent;

 

(m)Other Information.  From time to time and promptly upon each request, such
data, certificates, reports, statements, opinions of counsel, documents or
further information regarding any Property or the business, assets, liabilities,
financial condition, results of operations or business prospects of the Borrower
or any of its Subsidiaries as the Agent or any Lender may request and which is
reasonably available to the Borrower or any such Subsidiary; and.

 

Article X. Negative Covenants

For so long as this Agreement is in effect, unless the Requisite Lenders (or, if
required pursuant to Section 13.6., all of the Lenders) shall otherwise consent
in the manner set forth in Section 13.6., the Borrower shall comply with the
following covenants:

 

Section 10.1.  Financial Covenants.

(a)Ratio of Total Indebtedness to Gross Asset Value.  The Borrower shall not
permit the ratio of (i) Total Indebtedness of the Borrower and its Subsidiaries
determined on a consolidated basis to (ii) Gross Asset Value, at the end of any
fiscal quarter, to exceed 0.550.60 to 1.00 at any time.

 

(b)[Intentionally Omitted].Ratio of Secured Indebtedness to Gross Asset Value. 
The Borrower shall not permit the ratio of (i) Secured Indebtedness of the
Borrower and its Subsidiaries on a consolidated basis to (ii) Gross Asset
Value of the Borrower and its Subsidiaries to exceed 0.40 to 1:00 at any time.

 

(c)[Intentionally Omitted].Ratio of Unencumbered Asset Value to Unsecured
Indebtedness.  The Borrower shall not permit the ratio of (i) Unencumbered Asset
Value to (ii)  Unsecured Indebtedness of the Borrower and its Subsidiaries on a
consolidated basis to be less than 1.50 to 1:00 at any time.

 

(d)Ratio of Adjusted EBITDA to Fixed Charges.  The Borrower shall not permit the
ratio of (i) Adjusted EBITDA of the Borrower and its Subsidiaries determined on
a consolidated basis for the four fiscal‑quarter period most recently ended to
(ii) Fixed Charges of the Borrower and its Subsidiaries determined on a
consolidated basis for such four-quarterfour fiscal‑quarter period, to be less
than 1.501.5 to 1.0 at the end of each fiscal quarter.

 

(e)Ratio of Unencumbered NOI to Unsecured Interest Expense.  The Borrower shall
not permit the ratio of (i) Unencumbered NOI of the Borrower and its
Subsidiaries determined on a consolidated basis to (ii) Interest Expense on
Indebtedness (other than Secured Indebtedness) of the Borrower and its
Subsidiaries determined on a consolidated basis, for any fiscal quarter to be
less than 1.75 to 1.00 for such fiscal quarter.[Intentionally Omitted]

 

(f)[Intentionally Omitted].

 

 

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(g)[Intentionally Omitted].

 

(h)Distributions.  If any Event of Default specified in Section 11.1.(a) exists,
the Borrower shall not, and shall not permit any Subsidiary to, declare or make
any Restricted Payment other than cash distributions to its shareholders during
any fiscal year in an aggregate amount not to exceed the minimum amount
necessary for the Borrower to remain in compliance with Section 8.12. and to
avoid payment for any federal income taxes or federal excise taxes imposed under
Sections 857(b)(1), 857(b)(3), and 4981 of the Internal Revenue Code.  If an
Event of Default specified in Section 11.1.(e) or Section 11.1.(f) exists, or if
as a result of the occurrence of any other Event of Default the Obligations have
been accelerated, the Borrower shall not, and shall not permit any Subsidiary
to, make any Restricted Payments to any Person whatsoever other than to the
Borrower or any Subsidiary.[Intentionally Omitted].

 

(i)Investments Generally. The Borrower shall not, and shall not permit any
Subsidiary to, directly or indirectly, acquire, make or purchase any Investment,
or permit any Investment of such Person to be outstanding on and after the
Agreement Date, other than the following:

(i)[Intentionally Omitted].

 

(i)Investments in cash, Cash Equivalents or institutional money market funds
organized under the laws of the United States of America or any state thereof
that invest solely in Cash Equivalents;

 

(ii)(x) trade credit extended on usual and customary terms in the ordinary
course of business, and (y) advances to employees for moving, relocation and
travel expenses, drawing accounts and similar expenditures in the ordinary
course of business;

 

(iii)Investments in Subsidiaries in existence on December 31, 2011 and disclosed
on Part I of Schedule 7.1.(b), whether such Investment was made on such date or
thereafter;

 

(iv)Investments to acquire Equity Interests of a Subsidiary or any other Person
who after giving effect to such acquisition would be a Subsidiary, so long as in
each case (x) immediately prior to such Investment, and after giving effect
thereto, no Default or Event of Default is or would be in existence and (y) if
such Subsidiary is (or immediately after giving effect to such Investment would
be) required to be a party to the Guaranty, the terms and conditions set forth
in Section 8.14. are satisfied; and

 

(v)other Investments subject to the immediately following subsection (j).

 

(j)Limitations on Certain Investments. 

 

(i)The Borrower shall not, and shall not permit any Subsidiary to, make an
Investment in or otherwise own the following items in clauses (A) through (D)
which would cause the aggregate value of such holdings of such Persons to exceed
the following percentages35.0% of Gross Asset Value at any time:  

 

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(iA)unimproved real estate, such that the aggregate value of all such unimproved
real estate, calculated on the basis of the lower of cost or market value,
exceeds 10.0 % of Gross Asset Value at any time (a Property that is a
Development Property shall not be considered to be unimproved real estate for
purposes of this clause);

 

(iiB)(x) Equity Interests in Persons (other than Subsidiaries, Unconsolidated
Affiliates and Persons that are REITs), calculated on the basis of the lower of
cost or market, and (y) Indebtedness secured by Mortgages in favor of the
Borrower or any Subsidiary, based on book value and determined on a consolidated
basis, such that the aggregate value of such Equity Interests and Indebtedness
exceeds 20.0% of Gross Asset Value;  

 

(iii)Investments in Unconsolidated Affiliates, such that the aggregate value of
such Investments exceeds 35.0% of Gross Asset Value, with the “value” of any
such Investment in an Unconsolidated Affiliate to be determined with respect to
the Borrower’s Ownership Share of such Unconsolidated Affiliate;

 

(ivC)other commercial real estate not developed for use as storage facilities,
such that the aggregate book value of such commercial real estate exceeds 15.0%
of Gross Asset Value.; and

 

(kD)Development Limits.  The Borrower shall not permit the aggregate amount of
the Total Budgeted Cost with respect to all Development Properties of the
Borrower, its Subsidiaries and all of the Borrower’s Unconsolidated Affiliates
to exceed 15.0% of Gross Asset Value at any time.  For purposes of this
subsection, the Total Budgeted Cost with respect to any Development Property
owned by an Unconsolidated Affiliate of the Borrower shall equal the greater of
(i) the product of (x) the Borrower’s Ownership Share in such Unconsolidated
Affiliate and (y) the Total Budgeted Cost for such Development Property or
(ii) the recourse obligations of the Borrower and its Subsidiaries relating to
the Indebtedness of such Unconsolidated Affiliate.

 

(l)[Intentionally Omitted].

(ii)The Borrower shall not, and shall not permit any Subsidiary to,
make Investments in Unconsolidated Affiliates, such that the aggregate value of
such Investments exceeds 50.0% of Gross Asset Value, with the “value” of any
such Investment in an Unconsolidated Affiliate to be determined in accordance
with GAAP.

(m)Gross Assets Value of Non-Guarantors.  The Borrower shall not permit Gross
Asset Value determined with respect to the Non-Guarantor Entities described in
clause (a) of the definition thereof obligated in respect of any Indebtedness
other than Nonrecourse Indebtedness to exceed 25.0% of the Gross Asset Value of
the Borrower and its Subsidiaries.

 

 

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Section 10.2.  Indebtedness.

The Borrower will not, and will not permit any other Loan Party or any other
Subsidiary to, incur, assume or otherwise become obligated in respect of any
Indebtedness after the Agreement Date if immediately after incurring, assuming
or otherwise becoming obligated in respect of such Indebtedness, a Default or
Event of Default would existresult therefrom, including without limitation, a
Default or Event of Default resulting from a violation of any of the covenants
contained in Section 10.1. determined after giving proforma effect thereto.

 

Section 10.3.  [Intentionally Omitted].

Section 10.4.  Restrictions on Intercompany Transfers[Intentionally Omitted].

Except for the encumbrances or restrictions described on Schedule 10.4., the
Borrower shall not, and shall not permit any Subsidiary either (a) having assets
whose book value is in excess of 5% of Gross Asset Value or (b) owning any
Eligible Property, to, create or otherwise cause or suffer to exist or become
effective any consensual encumbrance or restriction of any kind on the ability
of any such Subsidiary to:  (i) pay dividends or make any other distribution on
any Equity Interests issued by such Subsidiary and owned by the Borrower or any
other Subsidiary; (ii) pay any Indebtedness owed to the Borrower or any other
Subsidiary; (iii) make loans or advances to the Borrower or any other
Subsidiary; or (iv) transfer any of its property or assets to the Borrower or
any other Subsidiary. 

 

Section 10.5.  Merger, Consolidation, Sales of Assets, Acquisitions and Other
Arrangements.

The Borrower shall not, and shall not permit any other Loan Party or any other
Subsidiary to, (a) enter into any transaction of merger or consolidation;
(b) liquidate, wind‑up or dissolve itself (or suffer any liquidation or
dissolution); (c) convey, sell, lease, sublease, transfer or otherwise dispose
of, in one transaction or a series of transactions, all or any substantial part
of its business or assets, or the capital stock of or other Equity Interests in
any of its Subsidiaries, whether now owned or hereafter acquired; or (d) acquire
(whether by purchase, acquisition of Equity Interests of a Person, or as a
result of a merger or consolidation) a Substantial Amount of the assets of, or
make an Investment of a Substantial Amount in, any other Person; provided,
however, that:

 

(i) the Borrower and its Subsidiaries may lease and sublease its respective
assets, as lessor or sublessor (as the case may be), in the ordinary course of
their business;

 

(ii)any of the actions described in the immediately preceding clauses (a)
through (c) may be taken with respect to any Subsidiary or any other Loan Party
(other than the Borrower) so long as immediately prior to the taking of such
action, and immediately thereafter and after giving effect thereto, no Default
or Event of Default is or would be in existence; notwithstanding the foregoing,
any such Loan Party (other than the Borrower) may enter into a transaction of
merger pursuant to which such Loan Party is not the survivor of such merger only
if the Borrower shall have given the Agent and

 

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the Lenders at least 10 Business Days’ prior written notice of such merger, such
notice to include a certification to the effect that immediately after and after
giving effect to such action, no Default or Event of Default is or would be in
existence; and

 

(iii)the Borrower, any other Loan Party and any other Subsidiary may, directly
or indirectly, (A) acquire (whether by purchase, acquisition of Equity Interests
of a Person, or as a result of a merger or consolidation) a Substantial Amount
of the assets of, or make an Investment of a Substantial Amount in, any other
Person and (B) sell, lease or otherwise transfer, whether by one or a series of
transactions, a Substantial Amount of assets (including capital stock or other
securities of Subsidiaries) to any other Person, so long as, in each case,
(1) the Borrower shall have given the Agent and the Lenders at least 15 days
prior written notice of such consolidation, merger, acquisition, Investment,
sale, lease or other transfer; (2) immediately prior thereto, and immediately
thereafter and after giving effect thereto, no Default or Event of Default is or
would be in existence; and  (32) in the case of a consolidation or merger
involving the Borrower or a Loan Party which owns an Eligible Property, such
Person shall be the survivor thereof and (4) at the time the Borrower gives
notice pursuant to clause (1) of this subsection, the Borrower shall have
delivered to the Agent and the Lenders a Compliance Certificate, calculated on a
pro forma basis, evidencing the continued compliance by the Borrower with the
terms and conditions of this Agreement and the other Loan Documents, including
without limitation, the financial covenants contained in Section 10.1., after
giving effect to such consolidation, merger, acquisition, Investment, sale,
lease or other transfer..

 

Section 10.6.  Plans[Intentionally Deleted].

The Borrower shall not, and shall not permit any other Loan Party or any other
Subsidiary to, permit any of its respective assets to become or be deemed to be
“plan assets” within the meaning of ERISA, the Internal Revenue Code and the
respective regulations promulgated thereunder.

 

Section 10.7.  Fiscal Year.

The Borrower shall not, and shall not permit any other Loan Party or any other
Subsidiary to, change its fiscal year from that in effect as of the Agreement
Date.

 

Section 10.8.  Modifications of Organizational Documents; Material Contracts. 

The Borrower shall not, and shall not permit any other Loan Party or other
Subsidiary to, amend, supplement, restate or otherwise modify its articles of
incorporation, by-laws, partnership agreement or other similar organizational
document if such amendment, supplement, restatement or other modification could
have a Material Adverse Effect.  The Borrower shall not, and shall not permit
any other Loan Party or any other Subsidiary to, enter into any amendment or
modification to any Material Contract that could reasonably be expected to have
a Material Adverse Effect or default in the performance of any obligations of
such Person in any Material Contract or permit any Material Contract to be
canceled or terminated prior to its stated maturity.

 

 

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Section 10.9.  Transactions with Affiliates[Intentionally Omitted]. 

Except for transactions described on Schedule 10.9., the Borrower shall not, and
shall not permit any Subsidiary to, permit to exist or enter into any
transaction (including the purchase, sale, lease or exchange of any property or
the rendering of any service) with any Affiliate of the Borrower or with any
director, officer or employee of any Subsidiary, except transactions in the
ordinary course of and pursuant to the reasonable requirements of the business
of the Borrower or any of its Subsidiaries and upon fair and reasonable terms
and are no less favorable to the Borrower or such Subsidiary than would be
obtained in a comparable arm’s length transaction with a Person that is not an
Affiliate. 

 

Article XI. Default

Section 11.1.  Events of Default.

Each of the following shall constitute an Event of Default, whatever the reason
for such event and whether it shall be voluntary or involuntary or be effected
by operation of Applicable Law or pursuant to any judgment or order of any
Governmental Authority:

 

(a)Default in Payment.  The Borrower shall fail to pay when due under this
Agreement or any other Loan Document (whether upon demand, at maturity, by
reason of acceleration or otherwise) (i) the principal of any Loan or any
Reimbursement Obligation or (ii) any interest on any of the Loans, or any of the
other payment Obligations owing by the Borrower under this Agreement or any
other Loan Document, or any other Loan Party shall fail to pay when due any
payment obligation owing by such Loan Party under any Loan Document to which it
is a party, and solely in the case of this clause (ii) such failure shall
continue for a period of 5 Business Days.

 

(b)Default in Performance. The Borrower or any other Loan Party shall fail to
perform or observe any term, covenant, condition or agreement contained (i) in
Section 10.1. or (ii) elsewhere in this Agreement or any other Loan Document to
which it is a party and not otherwise mentioned in this Section and solely in
the case of this clause (ii) such failure shall continue for a period of 30
calendar days after the earlier of (x) the date upon which the Borrower obtains
knowledge of such failure or (y) the date upon which the Borrower has received
written notice of such failure from the Agent; provided, however, if such
violation is capable of cure but cannot be cured within such 30-day period and
such Loan Party in good faith commenced to cure such failure within such 30-day
period and continues diligently to prosecute such cure, no Event of Default
shall be deemed to have occurred unless such failure has not been cured within
30 calendar days after the last day of the initial 30-day period.

 

(c)Misrepresentations.  Any written statement, representation or warranty made
or deemed made by or on behalf of the Borrower or any other Loan Party under
this Agreement or under any other Loan Document, or any amendment hereto or
thereto, or in any other writing or statement at any time furnished by, or at
the direction of, the Borrower or any other Loan Party to the Agent, any Issuing
Bank or any Lender, shall at any time prove to have been incorrect or misleading
in any material respect when furnished or made.

 

 

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(d)Indebtedness Cross‑Default.

 

(i)The Borrower or any Subsidiary shall fail to pay when due and payable the
principal of, or interest on, any Recourse Indebtedness (other than the Loans)
having an aggregate outstanding principal amount of $50,000,000100,000,000 or
more (“Material Indebtedness”) and such failure shall continue beyond any
applicable cure periods; or

 

(ii)(x) The maturity of any Material Indebtedness shall have been accelerated in
accordance with the provisions of any indenture, contract or instrument
evidencing, providing for the creation of or otherwise concerning such Material
Indebtedness or (y) any Material Indebtedness shall have been required to be
prepaid or repurchased prior to the stated maturity thereof; or

 

(iii)Any other event shall have occurred and be continuing (including the
expiration of any applicable cure periods) which permits any holder or holders
of any Recourse Indebtedness (other than the Loans) having an aggregate
outstanding principal amount of $50,000,000100,000,000 or more (“Other Material
Indebtedness”), any trustee or agent acting on behalf of such holder or holders
or any other Person, to accelerate the maturity of Other Material Indebtedness
or require any Other Material Indebtedness to be prepaid or repurchased prior to
its stated maturity.

 

Notwithstanding the foregoing subsection (d), with respect to
Nonrecourse  Indebtedness, this subsection (d) shall apply only to Nonrecourse
Indebtedness having an outstanding aggregate principal balance of $50,000,000 or
more.

 

(e)Voluntary Bankruptcy Proceeding.  The Borrower, any other Loan Party or any
other Material Subsidiary shall:  (i) commence a voluntary case under the
Bankruptcy Code of 1978, as amended or other federal bankruptcy laws (as now or
hereafter in effect); (ii) file a petition seeking to take advantage of any
other Applicable Laws, domestic or foreign, relating to bankruptcy, insolvency,
reorganization, winding‑up, or composition or adjustment of debts; (iii) consent
to, or fail to contest in a timely and appropriate manner, any petition filed
against it in an involuntary case under such bankruptcy laws or other Applicable
Laws or consent to any proceeding or action described in the immediately
following subsection; (iv) apply for or consent to, or fail to contest in a
timely and appropriate manner, the appointment of, or the taking of possession
by, a receiver, custodian, trustee, or liquidator of itself or of a substantial
part of its property, domestic or foreign; (v) admit in writing its inability to
pay its debts as they become due; (vi) make a general assignment for the benefit
of creditors; (vii) make a conveyance fraudulent as to creditors under any
Applicable Law; or (viii) take any corporate or partnership action for the
purpose of effecting any of the foregoing.

 

(f)Involuntary Bankruptcy Proceeding.  A case or other proceeding shall be
commenced against the Borrower, any other Loan Party or any other Material
Subsidiary in any court of competent jurisdiction seeking:  (i) relief under the
Bankruptcy Code of 1978, as amended or other federal bankruptcy laws (as now or
hereafter in effect) or under any other Applicable Laws, domestic or foreign,
relating to bankruptcy, insolvency, reorganization,

 

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winding‑up, or composition or adjustment of debts; or (ii) the appointment of a
trustee, receiver, custodian, liquidator or the like of such Person, or of all
or any substantial part of the assets, domestic or foreign, of such Person, and
in the case of either clause (i) or (ii) such case or proceeding shall continue
undismissed or unstayed for a period of 60 consecutive calendar days, or an
order granting the relief requested in such case or proceeding (including, but
not limited to, an order for relief under such Bankruptcy Code or such other
federal bankruptcy laws) shall be entered.

 

(g)Revocation of Loan Documents.  The Borrower or any other Loan Party shall (or
shall attempt to) disavow, revoke or terminate any Loan Document to which it is
a party or shall otherwise challenge or contest in any action, suit or
proceeding in any court or before any Governmental Authority the validity or
enforceability of any Loan Document.

 

(h)Judgment.   A judgment or order for the payment of money shall be entered
against the Borrower or any Subsidiary, by any court or other tribunal and
(i) such judgment or order shall continue for a period of 30 days without being
paid stayed or dismissed through appropriate appellate proceedings and
(ii) either (A) the amount for which insurance has not been acknowledged in
writing by the applicable insurance carrier (or the amount as to which the
insurer has denied liability) exceeds, individually or together with all other
such judgments or orders entered against the Borrower and its Subsidiaries,
$100,000,000 or (B) such judgment or order could reasonably be expected to have
a Material Adverse Effect.

 

(i)Attachment.  A warrant, writ of attachment, execution or similar process
shall be issued against any property of the Borrower or any Subsidiary, which
exceeds, individually or together with all other such warrants, writs,
executions and processes, $100,000,000 in amount and such warrant, writ,
execution or process shall not be paid, discharged, vacated, stayed or bonded
for a period of 30 days.

 

(j)ERISA.  Any member of the ERISA Group shall fail to pay when due an amount or
amounts aggregating in excess of $2,500,000 which it shall have become liable to
pay under Title IV of ERISA; or notice of intent to terminate a Material Plan
shall be filed under Title IV of ERISA by any member of the ERISA Group, any
plan administrator or any combination of the foregoing; or the PBGC shall
institute proceedings under Title IV of ERISA to terminate, to impose liability
(other than for premiums under Section 4007 of ERISA) in respect of, or to cause
a trustee to be appointed to administer any Material Plan; or a condition shall
exist by reason of which the PBGC would be entitled to obtain a decree
adjudicating that any Material Plan must be terminated; or there shall occur a
complete or partial withdrawal from, or a default, within the meaning of Section
4219(c)(5) of ERISA, with respect to, one or more Multiemployer Plans which
could cause one or more members of the ERISA Group to incur a current payment
obligation in excess of $2,500,000.

 

(k)Loan Documents.  An Event of Default (as defined therein) shall occur under
any of the other Loan Documents;

 

(l)Change of Control.  A Change of Control shall occur.

 

 

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Section 11.2.  Remedies Upon Event of Default.

Upon the occurrence of an Event of Default the following provisions shall apply:

 

(a)Acceleration; Termination of Facilities.

 

(i)Automatic.  Upon the occurrence of an Event of Default specified in
Sections 11.1.(e) or 11.1.(f), (1)(A) the principal of, and all accrued interest
on, the Loans and the Notes at the time outstanding, (B) an amount equal to the
Stated Amount of all Letters of Credit outstanding as of the date of the
occurrence of such Event of Default and (C) all of the other Obligations of the
Borrower, including, but not limited to, the other amounts owed to the Lenders,
the Issuing Banks and the Agent under this Agreement, the Notes or any of the
other Loan Documents shall become immediately and automatically due and payable
by the Borrower without presentment, demand, protest, or other notice of any
kind, all of which are expressly waived by the Borrower and (2) the Commitments
and the Swingline Commitment, the obligation of the Lenders to make Loans
hereunder, and the obligation of the AgentIssuing Banks to issue Letters of
Credit hereunder, shall all immediately and automatically terminate.

 

(ii)Optional.  If any other Event of Default shall exist, the Agent may, and at
the direction of the Requisite Lenders shall:  (1) declare (A) the principal of,
and accrued interest on, the Loans and the Notes at the time outstanding, (B) an
amount equal to the Stated Amount of all Letters of Credit outstanding as of the
date of the occurrence of such Event of Default and (C) all of the other
Obligations, including, but not limited to, the other amounts owed to the
Lenders, the Issuing Banks and the Agent under this Agreement, the Notes or any
of the other Loan Documents to be forthwith due and payable, whereupon the same
shall immediately become due and payable without presentment, demand, protest or
other notice of any kind, all of which are expressly waived by the Borrower and
(2) terminate the Commitments and the obligation of the Lenders to make Loans
hereunder and the obligation of the AgentIssuing Banks to issue Letters of
Credit hereunder.  If the Agent has exercised any of the rights provided under
the preceding sentence, the Swingline Lender shall:  (x) declare the principal
of, and accrued interest on, the Swingline Loans and the Swingline Notes at the
time outstanding, and all of the other Obligations owing to the Swingline
Lender, to be forthwith due and payable, whereupon the same shall immediately
become due and payable without presentment, demand, protest or other notice of
any kind, all of which are expressly waived by the Borrower and (y) terminate
the Swingline Commitment and the obligation of the Swingline Lender to make
Swingline Loans.

 

(b)Loan Documents.  The Requisite Lenders may direct the Agent to, and the Agent
if so directed shall, exercise any and all of its rights under any and all of
the other Loan Documents.

 

(c)Applicable Law.  The Requisite Lenders may direct the Agent to, and the Agent
if so directed shall, exercise all other rights and remedies it may have under
any Applicable Law.

 

 

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(d)Appointment of Receiver.  To the extent permitted by Applicable Law, the
Agent and the Lenders shall be entitled to the appointment of a receiver for the
assets and properties of the Borrower and its Subsidiaries, without notice of
any kind whatsoever and without regard to the adequacy of any security for the
Obligations or the solvency of any party bound for its payment, to take
possession of all or any portion of the of the business operations of the
Borrower and its Subsidiaries and to exercise such power as the court shall
confer upon such receiver.

 

Section 11.3.  Remedies Upon Default.

Upon the occurrence of a Default specified in Sections 11.1.(e) or 11.1.(f), the
Commitments and the obligation of the Issuing Banks to issue Letters of Credit
shall immediately and automatically terminate. 

 

Section 11.4.  Marshaling; Payments Set Aside.

Neither the Agent nor any Lender shall be under any obligation to marshal any
assets in favor of any Loan Party or any other party or against or in payment of
any or all of the Obligations.  To the extent that any Loan Party makes a
payment or payments to the Agent, any Issuing Bank and/or any Lender, or the
Agent, any Issuing Bank and/or any Lender enforce their security interests or
exercise their rights of setoff, and such payment or payments or the proceeds of
such enforcement or setoff or any part thereof are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law or equitable cause, then to the extent of such
recovery, the Obligations or part thereof originally intended to be satisfied,
and all Liens, rights and remedies therefor, shall be revived and continued in
full force and effect as if such payment had not been made or such enforcement
or setoff had not occurred.

 

Section 11.5.  Allocation of Proceeds.

If an Event of Default exists and maturity of any of the Obligations has been
accelerated, all payments received by the Agent under any of the Loan Documents,
in respect of any principal of or interest on the Obligations or any other
amounts payable by the Borrower hereunder or thereunder, shall be applied in the
following order and priority:

 

(a)amounts due to the Agent and the Lenders in respect of Fees and expenses due
under Section 13.2.;

(a)payment of that portion of the Obligations constituting fees, indemnities,
expenses and other amounts, including attorney fees, payable to the Agent in its
capacity as such, each Issuing Bank in its capacity as such and the Swingline
Lender in its capacity as such, ratably among the Agent, the Issuing Banks and
the Swingline Lender in proportion to the respective amounts described in this
clause (a) payable to them;

 

(b)payment of that portion of the Obligations constituting fees, indemnities and
other amounts (other than principal and interest) payable to the Lenders under
the Loan Documents, including attorney fees, ratably among the Lenders, in
proportion to the respective amounts described in this clause (b) payable to
them;

 

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(bc)payments ofpayment of that portion of the Obligations constituting accrued
and unpaid interest on the Swingline Loans;

 

(c)payments of interest on all other Loans, to be applied for the ratable
benefit of the Lenders, in such order as the Lenders may determine in their sole
discretion;

(d)payment of that portion of the Obligations constituting accrued and unpaid
interest on the Loans and Reimbursement Obligations, ratably among the Lenders
and the Issuing Banks in proportion to the respective amounts described in this
clause (d) payable to them;

 

(de)payment of principal on Swingline Loans;

 

(ef)payments of principal of all other Loans and of all Reimbursement
Obligations, to be applied for the ratable benefit ofratably among the Lenders,
in such order as the Lenders may determine in their sole discretion;

 and the Issuing Banks in proportion to the respective amounts described in this
clause (f) payable to them; provided, however, to the extent that any 

(f)amounts to be depositedavailable for distribution pursuant to this clause are
attributable to the issued but undrawn amount of an outstanding Letter of
Credit, such amounts shall be paid to the Agent for deposit into the Letter of
Credit collateralCollateral Account in respect of Letters of Credit;  

 

(g)amounts due to the Agent and the Lenders pursuant to Sections 12.7. and
13.9.;

 

(hg)payments of all other amounts due under any of the Loan Documents, if any,
to be applied for the ratable benefit of the Lenders and Issuing Banks, as
applicable; and

 

(ih)any amount remaining after application as provided above, shall be paid to
the Borrower or whomever else may be legally entitled thereto.

 

Section 11.6.  Letter of Credit Collateral Account.

(a)As collateral security for the prompt payment in full when due of all Letter
of Credit Liabilities, the Borrower hereby pledges and grants to the Agent, for
the benefit of the AgentIssuing Banks and the Lenders as provided herein, a
security interest in all of its right, title and interest in and to the Letter
of Credit Collateral Account and the balances from time to time in the Letter of
Credit Collateral Account (including the investments and reinvestments therein
provided for below).  The balances from time to time in the Letter of Credit
Collateral Account shall not constitute payment of any Letter of Credit
Liabilities until applied by the Agent as provided herein.  Anything in this
Agreement to the contrary notwithstanding, funds held in the Letter of Credit
Collateral Account shall be subject to withdrawal only as provided in this
Section and in Section 2.16.

 

 

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(b)Amounts on deposit in the Letter of Credit Collateral Account shall be
invested and reinvested by the Agent in such Cash Equivalents as the Agent shall
determine in its sole discretion.  All such investments and reinvestments shall
be held in the name of and be under the sole dominion and control of the Agent
for the ratable benefit of the Issuing Banks and the Lenders,  provided, that
all earnings on such investments will be credited to and retained in the Letter
of Credit Collateral Account.  The Agent shall exercise reasonable care in the
custody and preservation of any funds held in the Letter of Credit Collateral
Account and shall be deemed to have exercised such care if such funds are
accorded treatment substantially equivalent to that which the Agent accords
other funds deposited with the Agent, it being understood that the Agent shall
not have any responsibility for taking any necessary steps to preserve rights
against any parties with respect to any funds held in the Letter of Credit
Collateral Account.

 

(c)If an Event of Default exists, the Agent may (and, if instructed by the
Requisite Lenders, shall) in its (or their) discretion at any time and from time
to time elect to liquidate any such investments and reinvestments and credit the
proceeds thereof to the Letter of Credit Collateral Account and apply or cause
to be applied such proceeds and any other balances in the Letter of Credit
Collateral Account to reimburse the applicable Issuing Bank for the payment made
by such Issuing bank or otherwise to the payment of any of the Letter of Credit
Liabilities due and payable.

 

(d)So long as no Default or Event of Default exists, the Agent shall, from time
to time, at the request of the Borrower, deliver to the Borrower, against
receipt but without any recourse, warranty or representation whatsoever, such of
the balances in the Letter of Credit Collateral Account as exceed the aggregate
amount of Letter of Credit Liabilities at such time.  When all of the
Obligations shall have been indefeasibly paid in full and no Letters of Credit
remain outstanding, the Agent shall deliver to the Borrower, against receipt but
without any recourse, warranty or representation whatsoever, the balances
remaining in the Letter of Credit Collateral Account.

 

(e)The Borrower shall pay to the Agent from time to time such fees as the Agent
normally charges for similar services in connection with the Agent’s
administration of the Letter of Credit Collateral Account and investments and
reinvestments of funds therein.

 

Section 11.7.  Performance by Agent.

If the Borrower shall fail to perform any covenant, duty or agreement contained
in any of the Loan Documents, the Agent may perform or attempt to perform such
covenant, duty or agreement on behalf of the Borrower after the expiration of
any cure or grace periods set forth herein.  In such event, the Borrower shall,
at the request of the Agent, promptly pay any amount reasonably expended by the
Agent in such performance or attempted performance to the Agent, together with
interest thereon at the applicable Post‑Default Rate from the date of such
expenditure until paid.  Notwithstanding the foregoing, neither the Agent nor
any Lender shall have any liability or responsibility whatsoever for the
performance of any obligation of the Borrower under this Agreement or any other
Loan Document.

 

 

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Section 11.8.  Rights Cumulative.

The rights and remedies of the Agent, the Issuing Banks and the Lenders under
this Agreement and each of the other Loan Documents shall be cumulative and not
exclusive of any rights or remedies which any of them may otherwise have under
Applicable Law.  In exercising their respective rights and remedies the Agent,
the Issuing Banks and the Lenders may be selective and no failure or delay by
the Agent, any Issuing Bank or any of the Lenders in exercising any right shall
operate as a waiver of it, nor shall any single or partial exercise of any power
or right preclude its other or further exercise or the exercise of any other
power or right.

 

Article XII. The Agent

Section 12.1.  Authorization and Action.

Each Lender and Issuing Bank hereby appoints and authorizes the Agent to take
such action as contractual representative on such Lender’s behalf and to
exercise such powers under this Agreement and the other Loan Documents as are
specifically delegated to the Agent by the terms hereof and thereof, together
with such powers as are reasonably incidental thereto. Not in limitation of the
foregoing, each and Issuing Bank  Lender authorizes and directs the Agent to
enter into the Loan Documents for the benefit of the Lenders.  Each Lender
hereby agrees that, except as otherwise set forth herein, any action taken by
the Requisite Lenders in accordance with the provisions of this Agreement or the
Loan Documents, and the exercise by the Requisite Lenders of the powers set
forth herein or therein, together with such other powers as are reasonably
incidental thereto, shall be authorized and binding upon all of the
Lenders.  Nothing herein shall be construed to deem the Agent a trustee or
fiduciary for any Issuing Bank or any Lender nor to impose on the Agent duties
or obligations other than those expressly provided for herein.  At the request
of a Lender, the Agent will forward to such Lender copies or, where appropriate,
originals of the documents delivered to the Agent pursuant to this Agreement or
the other Loan Documents.  The Agent will also furnish to any Lender, upon the
request of such Lender, a copy of any certificate or notice furnished to the
Agent by the Borrower, any Loan Party or any other Affiliate of the Borrower,
pursuant to this Agreement or any other Loan Document not already delivered to
such Lender pursuant to the terms of this Agreement or any such other Loan
Document.  As to any matters not expressly provided for by the Loan Documents
(including, without limitation, enforcement or collection of any of the
Obligations), the Agent shall not be required to exercise any discretion or take
any action, but shall be required to act or to refrain from acting (and shall be
fully protected in so acting or refraining from acting) upon the instructions of
the Requisite Lenders (or all of the Lenders if explicitly required under any
other provision of this Agreement), and such instructions shall be binding upon
all Lenders and all holders of any of the Obligations; provided, however, that,
notwithstanding anything in this Agreement to the contrary, the Agent shall not
be required to take any action which exposes the Agent to personal liability or
which is contrary to this Agreement or any other Loan Document or Applicable
Law.  Not in limitation of the foregoing, the Agent shall not exercise any right
or remedy it or the Lenders may have under any Loan Document upon the occurrence
of a Default or an Event of Default unless the Requisite Lenders have so
directed the Agent to exercise such right or remedy.

 

 

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Section 12.2.  Agent’s Reliance, Etc.

Notwithstanding any other provisions of this Agreement or any other Loan
Documents, neither the Agent nor any of its directors, officers, agents,
employees or counsel shall be liable for any action taken or omitted to be taken
by it or them under or in connection with this Agreement, except for its or
their own gross negligence or willful misconduct as determined by a court of
competent jurisdiction in a nonappealable judgment.  Without limiting the
generality of the foregoing, the Agent: (a) may treat the payee of any Note as
the holder thereof until the Agent receives written notice of the assignment or
transfer thereof signed by such payee and in form satisfactory to the Agent;
(b) may consult with legal counsel (including its own counsel or counsel for the
Borrower or any other Loan Party), independent public accountants and other
experts selected by it and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts; (c) makes no warranty or representation to any Lender or
any other Person and shall not be responsible to any Lender or any other Person
for any statements, warranties or representations made by any Person in or in
connection with this Agreement or any other Loan Document; (d) shall not have
any duty to ascertain or to inquire as to the performance or observance of any
of the terms, covenants or conditions of any of this Agreement or any other Loan
Document or the satisfaction of any conditions precedent under this Agreement or
any Loan Document on the part of the Borrower or other Persons or inspect the
property, books or records of the Borrower or any other Person; (e) shall not be
responsible to any Lender or any Issuing Bank for the due execution, legality,
validity, enforceability, genuineness, sufficiency or value of this Agreement or
any other Loan Document, or any other instrument or document furnished pursuant
thereto; and (f) shall incur no liability under or in respect of this Agreement
or any other Loan Document by acting upon any notice, consent, certificate or
other instrument or writing (which may be by telephone or telecopy) believed by
it to be genuine and signed, sent or given by the proper party or parties.

 

Section 12.3.  Notice of Defaults.

The Agent shall not be deemed to have knowledge or notice of the occurrence of a
Default or Event of Default unless the Agent has received notice from a Lender,
an Issuing Bank or the Borrower referring to this Agreement, describing with
reasonable specificity such Default or Event of Default and stating that such
notice is a “notice of default.”  If any Lender (excluding the Lender which is
also serving as the Agent) becomes aware of any Default or Event of Default, it
shall promptly send to the Agent such a “notice of default.”  Further, if the
Agent receives such a “notice of default”, the Agent shall give prompt notice
thereof to the Lenders.

 

Section 12.4.  Wells Fargo as Lender.

Wells Fargo, as a “Lender”, shall have the same rights and powers under this
Agreement and any other Loan Document as any other Lender and may exercise the
same as though it were not the Agent; and the term “Lender” or “Lenders” shall,
unless otherwise expressly indicated, include Wells Fargo in each case in its
individual capacity.  Wells Fargo and its affiliates may each accept deposits
from, maintain deposits or credit balances for, invest in, lend money to, act as
trustee under indentures of, serve as financial advisor to, and generally engage
in any kind of business with the Borrower, any other Loan Party or any other
affiliate thereof as if it were any other bank and without any duty to account
therefor to the other Lenders.  Further, the Agent and

 

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any affiliate may accept fees and other consideration from the Borrower for
services in connection with this Agreement and otherwise without having to
account for the same to the other Lenders.

 

Section 12.5.  Approvals of Lenders.

All communications from the Agent to any Lender requesting such Lender’s
determination, consent, approval or disapproval (a) shall be given in the form
of a written notice to such Lender, (b) shall be accompanied by a description of
the matter or issue as to which such determination, approval, consent or
disapproval is requested, or shall advise such Lender where information, if any,
regarding such matter or issue may be inspected, or shall otherwise describe the
matter or issue to be resolved, (c) shall include, if reasonably requested by
such Lender and to the extent not previously provided to such Lender, written
materials and a summary of all oral information provided to the Agent by the
Borrower in respect of the matter or issue to be resolved, and (d) shall include
the Agent’s recommended course of action or determination in respect
thereof.  Each Lender shall reply promptly, but in any event within 10 Business
Days (or such lesser or greater period as may be specifically required under the
express terms of the Loan Documents) of receipt of such communication.  Except
as otherwise expressly provided in this Agreement, unless a Lender shall give
written notice to the Agent that it specifically objects to the recommendation
or determination of the Agent (together with a written explanation of the
reasons behind such objection) within the applicable time period for reply, such
Lender shall be deemed to have conclusively approved of or consented to such
recommendation or determination (other than in respect of any consent required
under the second sentence of Section 13.6.(b)).

 

Section 12.6.  Lender Credit Decision, Etc.

Each Lender and Issuing Bank expressly acknowledges and agrees that neither the
Agent nor any of its officers, directors, employees, agents, counsel,
attorneys‑in‑fact or other affiliates has made any representations or warranties
as to the financial condition, operations, creditworthiness, solvency or other
information concerning the business or affairs of the Borrower, any other Loan
Party, any Subsidiary or any other Person to such Lender or Issuing Bank and
that no act by the Agent hereafter taken, including any review of the affairs of
the Borrower, shall be deemed to constitute any such representation or warranty
by the Agent to any Lender or Issuing Bank.  Each Lender and Issuing Bank
acknowledges that it has, independently and without reliance upon the Agent, any
other Lender or counsel to the Agent, or any of their respective officers,
directors, employees and agents, and based on the financial statements of the
Borrower, the Subsidiaries or any other Affiliate thereof, and inquiries of such
Persons, its independent due diligence of the business and affairs of the
Borrower, the Loan Parties, the Subsidiaries and other Persons, its review of
the Loan Documents, the legal opinions required to be delivered to it hereunder,
the advice of its own counsel and such other documents and information as it has
deemed appropriate, made its own credit and legal analysis and decision to enter
into this Agreement and the transaction contemplated hereby.  Each Lender and
Issuing Bank also acknowledges that it will, independently and without reliance
upon the Agent, any other Lender, any other Issuing Bank or counsel to the Agent
or any of their respective officers, directors, employees and agents, and based
on such review, advice, documents and information as it shall deem appropriate
at the time, continue to make its own decisions in taking or not taking action
under the Loan Documents.  Except for notices, reports and other documents and

 

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information expressly required to be furnished to the Lenders and/or the Issuing
Banks by the Agent under this Agreement or any of the other Loan Documents, the
Agent shall have no duty or responsibility to provide any Lender or Issuing Bank
with any credit or other information concerning the business, operations,
property, financial and other condition or creditworthiness of the Borrower, any
other Loan Party or any other Affiliate thereof which may come into possession
of the Agent or any of its officers, directors, employees, agents,
attorneys‑in‑fact or other Affiliates.  Each Lender and Issuing Bank
acknowledges that the Agent’s legal counsel in connection with the transactions
contemplated by this Agreement is only acting as counsel to the Agent and is not
acting as counsel to such Lender or Issuing Bank.

 

Section 12.7.  Indemnification of Agent.

Each Lender agrees to indemnify the Agent (to the extent not reimbursed by the
Borrower and without limiting the obligation of the Borrower to do so) pro rata
in accordance with such Lender’s respective Commitment Percentage, from and
against any and all liabilities, obligations, losses, damages, penalties,
actions, judgments, suits, costs, expenses or disbursements of any kind or
nature whatsoever which may at any time be imposed on, incurred by, or asserted
against the Agent (in its capacity as Agent but not as a “Lender”) in any way
relating to or arising out of the Loan Documents, any transaction contemplated
hereby or thereby or any action taken or omitted by the Agent under the Loan
Documents (collectively, “Indemnifiable Amounts”); provided, however, that no
Lender shall be liable for any portion of such Indemnifiable Amounts to the
extent resulting from the Agent’s gross negligence or willful misconduct or if
the Agent fails to follow the written direction of the Requisite Lenders unless
such failure is pursuant to the advice of counsel of which the Lenders have
received notice.  Without limiting the generality of the foregoing, each Lender
agrees to reimburse the Agent (to the extent not reimbursed by the Borrower and
without limiting the obligation of the Borrower to do so) promptly upon demand
for its ratable share of any out‑of‑pocket expenses (including counsel fees of
the counsel(s) of the Agent’s own choosing) incurred by the Agent in connection
with the preparation, negotiation, execution, administration, or enforcement of,
or legal advice with respect to the rights or responsibilities of the parties
under, the Loan Documents, any suit or action brought by the Agent to enforce
the terms of the Loan Documents and/or collect any Obligations, any “lender
liability” suit or claim brought against the Agent and/or the Lenders, and any
claim or suit brought against the Agent and/or the Lenders arising under any
Environmental Laws.  Such out‑of‑pocket expenses (including counsel fees) shall
be advanced by the Lenders on the request of the Agent notwithstanding any claim
or assertion that the Agent is not entitled to indemnification hereunder upon
receipt of an undertaking by the Agent that the Agent will reimburse the Lenders
if it is actually and finally determined by a court of competent jurisdiction
that the Agent is not so entitled to indemnification.  The agreements in this
Section shall survive the payment of the Loans and all other amounts payable
hereunder or under the other Loan Documents and the termination of this
Agreement.  If the Borrower shall reimburse the Agent for any Indemnifiable
Amount following payment by any Lender to the Agent in respect of such
Indemnifiable Amount pursuant to this Section, the Agent shall share such
reimbursement on a ratable basis with each Lender making any such payment.

 

 

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Section 12.8.  Successor Agent.

The Agent may resign at any time as Agent under the Loan Documents by giving
written notice thereof to the Lenders and the Borrower.  In the event of a
material breach of its duties hereunder, the Agent may be removed as Agent under
the Loan Documents at any time by all Lenders (other than the Lender then acting
as Agent) and the Borrower upon 30‑day’s prior notice.  Upon any such
resignation or removal, the Requisite Lenders (which, in the case of the removal
of the Agent as provided in the immediately preceding sentence, shall be
determined without regard to the Commitment of the Lender then acting as Agent)
shall have the right to appoint a successor Agent which appointment shall,
provided no Default or Event of Default exists, be subject to the Borrower’s
approval, which approval shall not be unreasonably withheld or delayed (except
that the Borrower shall, in all events, be deemed to have approved each Lender
as a successor Agent).  If no successor Agent shall have been so appointed in
accordance with the immediately preceding sentence, and shall have accepted such
appointment, within 30 days after the resigning Agent’s giving of notice of
resignation or the Lenders’ removal of the resigning Agent, then the resigning
or removed Agent may, on behalf of the Lenders, appoint a successor Agent, which
shall be a Lender, if any Lender shall be willing to serve, and otherwise shall
be a commercial bank having total combined assets of at least
$10,000,000,000.  Upon the acceptance of any appointment as Agent hereunder by a
successor Agent, such successor Agent shall thereupon succeed to and become
vested with all the rights, powers, privileges and duties of the retiring Agent,
and the retiring Agent shall be discharged from its duties and obligations under
the Loan Documents.  After any Agent’s resignation or removal hereunder as
Agent, the provisions of this Article XII. shall continue to inure to its
benefit as to any actions taken or omitted to be taken by it while it was Agent
under the Loan Documents.

 

Section 12.9.  Titled Agents.

Each of the Joint Lead Arrangers, Joint Bookrunners, the Syndication Agent and
any other Person awarded a similar title (each a “Titled Agent”) in each such
respective capacity, assumes no responsibility or obligation hereunder,
including, without limitation, for servicing, enforcement or collection of any
of the Loans, nor any duties as an agent hereunder for the Lenders.  The titles
given to the Titled Agents are solely honorific and imply no fiduciary
responsibility on the part of the Titled Agents to the Agent, any Lender, the
Borrower or any other Loan Party and the use of such titles does not impose on
the Titled Agents any duties or obligations greater than those of any other
Lender or entitle the Titled Agents to any rights other than those to which any
other Lender is entitled.

 

Section 12.10.  Approvals and Other Actions by LendersIntentionally Omitted.

(a)Requisite Lenders.  Each of the following shall require the approval of, or
may be taken at the request of, the Requisite Lenders:

 

(i)Termination of the Commitments and acceleration of the Obligations upon the
occurrence of an Event of Default as provided in Section 11.2.(a)(ii);

 

(ii)Approving of a replacement Agent as provided in Section 12.8.;

 

 

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(iii)Except as specifically provided otherwise in Section 13.6., any consent or
approval regarding, any waiver of the performance or observance by the Borrower
of and the waiver of the continuance of any Default or Event of Default in
respect of, any term of this Agreement or any other Loan Document.

 

(b)All Lenders.  Each of the following shall require the approval of, or may be
taken only at the request of, all of the Lenders:

 

(i)Agreeing that the Borrower’s reduction of the aggregate amount of Commitments
below the amount set forth in Section 2.13. will not result in a termination of
this Agreement;

 

(ii)Consenting to extensions of the Termination Date as provided in Section
2.14.;

 

(iii)Removing the Agent for good cause as provided in Section 12.8.;

 

(iv)Consenting to the assignment by the Borrower to another Person of the
Borrower’s rights and obligations under this Agreement as provided in Section
13.5.(a); and

 

(v)Any consent or approval regarding, any waiver of the performance or
observance by the Borrower of and the waiver of the continuance of any Default
or Event of Default in respect of, any term of this Agreement or any other Loan
Document described in Section 13.6.(a) through (k).

 

(c)Conflict with Terms of Loan Documents.  To the extent any provision of this
Section conflicts with any other provision of this Agreement, including without
limitation, Section 13.6., or any other Loan Document, such other provision
shall control.

 

Article XIII. Miscellaneous

Section 13.1.  Notices.

Unless otherwise provided herein, communications provided for hereunder shall be
in writing and shall be mailed, telecopied or delivered as follows:

 

If to the Borrower:

 

Public Storage

701 Western Avenue

Glendale, California  91201-2349

Attention:  Chief Financial Officer

Telecopy Number:(818) 244-9267

Telephone Number:(818) 244-8080

 

with a copy to: 

 

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Public Storage

701 Western Avenue

Glendale, California  91201-2349

Attention:  Chief Legal Officer

Telecopy Number:(818) 548-9288

Telephone Number:(818) 244-8080

 

 

If to the Agent:

 

Wells Fargo Bank, National Association

1000 Lakes Drive401 B Street, Suite 2501100

West CovinaSan Diego, California  9179092101

Attention: Catherine AbeDale Northup

Telecopy Number:(626619)  919699-29093105

Telephone Number:(626619)  919699-66283025

 

If to a Lender:

 

To such Lender’s address or telecopy number, as applicable, set forth in the
applicable Administrative Questionnaire or Assignment and Acceptance Agreement.

 

If to Wells Fargo, in its capacity as Issuing Bank:

 

Wells Fargo Bank, National Association

401 B Street, Suite 1100

San Diego, California  92101

Attention: Dale Northup

Telecopy Number:(619) 699-3105

Telephone Number:(619) 699-3025

 

 

 

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If to Bank of America, N.A., in its capacity as Issuing Bank:

 

Bank of America, N.A.

1 Fleet Way

Scranton, Pennsylvania  18507

 

Letter of Credit Coordinators:

 

John Yzeik

Telecopy Number:  1-800-755-8743

Telephone Number: 570-496-9588

 

Jennifer Whitlock

Telecopy Number:  1-800-755-8743

Telephone Number: 570-496-9586

 

Charles Herron (Late Shift Coordinator from 11:30 a.m. – 8:00 p.m. Eastern)

Telecopy Number:  1-800-755-8743

Telephone Number: 570-496-9564

 

or, as to each party at such other address as shall be designated by such party
in a written notice to the other parties delivered in compliance with this
Section.  All such notices and other communications shall be effective (i) if
mailed, when received; (ii) if telecopied, when transmitted; or (iii) if hand
delivered, when delivered.  Notwithstanding the immediately preceding sentence,
all notices or communications to the Agent, any Issuing Bank or any Lender under
Article II. shall be effective only when actually received.  NeitherNone of the
Agent nor, any Issuing Bank or any Lender shall incur any liability to the
Borrower (nor shall the Agent incur any liability to the Lenders or the Issuing
Banks) for acting upon any telephonic notice referred to in this Agreement which
the Agent, such Issuing Bank or such Lender, as the case may be, believes in
good faith to have been given by a Person authorized to deliver such notice or
for otherwise acting in good faith hereunder.

 

Section 13.2.  Expenses.

The Borrower agrees (a) to pay or reimburse the Agent for all of its reasonable
out-of-pocket costs and expenses incurred in connection with the preparation,
negotiation, execution and delivery of, and any amendment, supplement or
modification to, any of the Loan Documents (including reasonable due diligence
expense and reasonable travel expenses related to closing), and the arrangement,
underwriting, syndication, consummation and administration of the transactions
contemplated thereby, including the reasonable fees and disbursements of counsel
to the Agent (but excluding any cost of in-house counsel), (b) to pay or
reimburse the Agent, the Issuing Banks and the Lenders for all their costs and
expenses incurred in connection with the enforcement or preservation of any
rights under the Loan Documents, including the reasonable fees and disbursements
of their respective counsel (including the reasonable allocated cost of in-house
counsel) and any payments in indemnification or otherwise payable by the Lenders
to the Agent pursuant to the Loan Documents, (c) to pay, and indemnify and hold
harmless the Agent, the Issuing Banks and the Lenders from, any and all
recording and filing fees and any and all

 

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liabilities with respect to, or resulting from any failure to pay or delay in
paying, documentary, stamp, excise and other similar taxes, if any, which may be
payable or determined to be payable in connection with the execution and
delivery of any of the Loan Documents, or consummation of any amendment,
supplement or modification of, or any waiver or consent under or in respect of,
any Loan Document and (d) to the extent not already covered by any of the
preceding subsections, to pay the reasonable fees and disbursements of counsel
to the Agent, any Issuing Bank and any Lender incurred in connection with the
representation of the Agent, such Issuing Bank or such Lender in any matter
relating to or arising out of any bankruptcy or other proceeding of the type
described in Sections 11.1.(e) or 11.1.(f), including, without limitation
(i) any motion for relief from any stay or similar order, (ii) the negotiation,
preparation, execution and delivery of any document relating to the Obligations
and (iii) the negotiation and preparation of any debtor‑in‑possession financing
or any plan of reorganization of the Borrower or any other Loan Party, whether
proposed by the Borrower, such Loan Party, the Lenders or any other Person, and
whether such fees and expenses are incurred prior to, during or after the
commencement of such proceeding or the confirmation or conclusion of any such
proceeding.

 

Section 13.3.  Setoff.

Subject to Section 3.3. and in addition to any rights now or hereafter granted
under Applicable Law and not by way of limitation of any such rights, the Agent,
each Issuing Bank, each Lender and each Participant is hereby authorized by the
Borrower, at any time or from time to time while an Event of Default exists,
without notice to the Borrower or to any other Person, any such notice being
hereby expressly waived, but in the case of an Issuing Bank, a Lender or a
Participant subject to receipt of the prior written consent of the Agent
exercised in its sole discretion, to set off and to appropriate and to apply any
and all deposits (general or special, including, but not limited to,
indebtedness evidenced by certificates of deposit, whether matured or unmatured)
and any other indebtedness at any time held or owing by the Agent, such Issuing
Bank, such Lender or any affiliate of the Agent, such Issuing Bank or such
Lender, to or for the credit or the account of the Borrower against and on
account of any of the Obligations, irrespective of whether or not any or all of
the Loans and all other Obligations have been declared to be, or have otherwise
become, due and payable as permitted by Section 11.2., and although such
obligations shall be contingent or unmatured.

 

Section 13.4.  Litigation; Jurisdiction; Other Matters; Waivers. 

(a)[Intentionally Omitted].

 

(b)EACH OF THE BORROWER, THE AGENT, EACH ISSUING BANK AND EACH LENDER HEREBY
AGREES THAT THE FEDERAL DISTRICT COURTS OF THE NORTHERN AND THE SOUTHERN
DISTRICTS OF CALIFORNIA AND THE STATE COURTS OF CALIFORNIA SHALL HAVE EXCLUSIVE
JURISDICTION TO HEAR AND DETERMINE ANY CLAIMS OR DISPUTES BETWEEN OR AMONG THE
BORROWER, THE AGENT, ANY ISSUING BANK OR ANY OF THE LENDERS, PERTAINING DIRECTLY
OR INDIRECTLY TO THIS AGREEMENT, THE LOANS AND LETTERS OF CREDIT, THE NOTES OR
ANY OTHER LOAN DOCUMENT OR TO ANY MATTER ARISING HEREFROM OR THEREFROM.  THE
BORROWER AND EACH OF THE LENDERS EXPRESSLY SUBMITS AND CONSENTS IN ADVANCE TO
SUCH

 

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JURISDICTION IN ANY ACTION OR PROCEEDING COMMENCED IN SUCH COURTS.  EACH PARTY
FURTHER WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF
ANY SUCH ACTION OR PROCEEDING IN ANY SUCH COURT OR THAT SUCH ACTION OR
PROCEEDING WAS BROUGHT IN AN INCONVENIENT FORUM AND EACH AGREES NOT TO PLEAD OR
CLAIM THE SAME.  THE CHOICE OF FORUM SET FORTH IN THIS SECTION SHALL NOT BE
DEEMED TO PRECLUDE THE ENFORCEMENT BY THE AGENT OR ANY LENDER OF ANY JUDGMENT
OBTAINED IN SUCH FORUM IN ANY OTHER APPROPRIATE JURISDICTION.

 

(c)THE PROVISIONS OF THIS SECTION HAVE BEEN CONSIDERED BY EACH PARTY WITH THE
ADVICE OF COUNSEL AND WITH A FULL UNDERSTANDING OF THE LEGAL CONSEQUENCES
THEREOF, AND SHALL SURVIVE THE PAYMENT OF THE LOANS AND ALL OTHER AMOUNTS
PAYABLE HEREUNDER OR UNDER THE OTHER LOAN DOCUMENTS, THE TERMINATION OR
EXPIRATION OF ALL LETTERS OF CREDIT AND THE TERMINATION OF THIS AGREEMENT.

 

Section 13.5.  Successors and Assigns.

(a)The provisions of this Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns, and except as otherwise permitted under Section 10.5.(iv), the Borrower
may not assign or otherwise transfer any of its rights or obligations under this
Agreement or as of the other Loan Documents without the prior written consent of
all Lenders (and any such assignment or other transfer to which all of the
Lenders have not so consented shall be null and void).

 

(b)Any Lender may make, carry or transfer Loans at, to or for the account of,
any of its branch offices or the office of an affiliate of such Lender except to
the extent such transfer would result in increased costs to the Borrower.

 

(c)Any Lender may at any time grant to one or more banks or other financial
institutions (each a “Participant”) participating interests in its Commitment or
the Obligations owing to such Lender; provided, however, any such participating
interest must be for a constant and not a varying percentage interest.  Except
as otherwise provided in Section 13.3., no Participant shall have any rights or
benefits under this Agreement or any other Loan Document.  In the event of any
such grant by a Lender of a participating interest to a Participant, such Lender
shall remain responsible for the performance of its obligations hereunder, and
the Borrower, the Issuing Banks and the Agent shall continue to deal solely and
directly with such Lender in connection with such Lender’s rights and
obligations under this Agreement.  Any agreement pursuant to which any Lender
may grant such a participating interest shall provide that such Lender shall
retain the sole right and responsibility to enforce the obligations of the
Borrower hereunder including, without limitation, the right to approve any
amendment, modification or waiver of any provision of this Agreement; provided,
however, such Lender may agree with the Participant that it will not, without
the consent of the Participant, agree to (i) increase, or extend the term or
extend the time or waive any requirement for the reduction or termination of,
such Lender’s Commitment, (ii) extend the date fixed for the payment of
principal of or interest on the

 

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Loans or portions thereof owing to such Lender, (iii) reduce the amount of any
such payment of principal, (iv) reduce the rate at which interest is payable
thereon or (v) release any Guarantor from its obligations under the
Guaranty.  An assignment or other transfer which is not permitted by
subsection (d) or (f) below shall be given effect for purposes of this Agreement
only to the extent of a participating interest granted in accordance with this
subsection (c).  The selling Lender shall notify the Agent and the Borrower of
the sale of any participation hereunder and the terms thereof.  Each Lender that
sells a participation shall, acting solely for this purpose as a non-fiduciary
agent of the Borrower, maintain a register on which it enters the name and
address of each Participant and the principal amounts (and stated interest) of
each Participant’s interest in the Loans or other obligations under the Loan
Documents (the “Participant Register”); provided that no Lender shall have any
obligation to disclose all or any portion of the Participant Register (including
the identity of any Participant or any information relating to a Participant’s
interest in any commitments, loans, letters of credit or its other obligations
under any Loan Document) to any Person except to the extent that such disclosure
is necessary to establish that such commitment, loan, letter of credit or other
obligation is in registered form under Section 5f.103-1(c) of the United States
Treasury Regulations.  The entries in the Participant Register shall be
conclusive absent manifest error, and such Lender shall treat each Person whose
name is recorded in the Participant Register as the owner of such participation
for all purposes of this Agreement notwithstanding any notice to the
contrary.  For the avoidance of doubt, the Agent (in its capacity as Agent)
shall have no responsibility for maintaining a Participant Register.

 

(d)Any Lender may with the prior written consent of the Agent (such consent not
to be unreasonably withheld or delayed) and, subject to the immediately
following clause (i), the Borrower assign to one or more Eligible Assignees
(each an “Assignee”) all or a portion of its Commitment and its other rights and
obligations under this Agreement and the Notes; provided, however, (i) so long
as no Default or Event of Default shall exist, the Borrower shall have consented
to such assignment (which consent, in each case, shall not be unreasonably
withheld or delayed) (it being agreed that the Borrower’s withholding of consent
to an assignment which would result in the Borrower having to pay amounts under
Section 3.11. shall be deemed to be reasonable)); (ii) no such consent by the
Borrower shall be required in the case of any assignment to another Lender or
any affiliate of such Lender or another Lender; (iii) no such consent by the
Agent shall be required in the case of any assignment by a Lender to any
affiliate of such Lender; (iv) any partial assignment shall be in an amount at
least equal to $10,000,000 and after giving effect to such assignment the
assigning Lender retains a Commitment, or if the Commitments have been
terminated, holds Notes having an aggregate outstanding principal balance, of at
least $10,000,000; and (v) each such assignment shall be effected by means of an
Assignment and Acceptance Agreement.  Upon execution and delivery of such
instrument and payment by such Assignee to such transferor Lender of an amount
equal to the purchase price agreed between such transferor Lender and such
Assignee, such Assignee shall be deemed to be a Lender party to this Agreement
as of the effective date of the Assignment and Acceptance Agreement and shall
have all the rights and obligations of a Lender with a Commitment as set forth
in such Assignment and Acceptance Agreement, and the transferor Lender shall be
released from its obligations hereunder to a corresponding extent, and no
further consent or action by any party shall be required.  Upon the consummation
of any assignment pursuant to this subsection, the transferor Lender, the Agent
and the Borrower shall make appropriate arrangements so that new Notes are
issued to the Assignee and such transferor Lender, as appropriate.  In
connection

 

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with any such assignment, the transferor Lender shall pay to the Agent an
administrative fee for processing such assignment in the amount of $4,500.

 

(e)The Agent shall maintain a copy of each Assignment and Acceptance Agreement
delivered to and accepted by it and a register for the recordation of the names
and addresses of the Lenders and the Commitment of each Lender from time to time
(the “Register”).  The Agent shall give each Lender and the Borrower notice of
the assignment by any Lender of its rights as contemplated by this Section.  The
Borrower, the Agent and the Lenders may treat each Person whose name is recorded
in the Register as a Lender hereunder for all purposes of this Agreement and the
other Loan Documents.  The Register and copies of each Assignment and Acceptance
Agreement shall be available for inspection by the Borrower or any Lender at any
reasonable time and from time to time upon reasonable prior notice to the
Agent.  Upon its receipt of an Assignment and Acceptance Agreement executed by
an assigning Lender, together with each Note subject to such assignment, the
Agent shall, if such Assignment and Acceptance Agreement has been completed and
if the Agent receives the processing and recording fee described in subsection
(d) above, (i) accept such Assignment and Acceptance Agreement, (ii) record the
information contained therein in the Register and (iii) give prompt notice
thereof to the Borrower. 

 

(f)[Intentionally Omitted.]

 

(g)In addition to the assignments and participations permitted under the
foregoing provisions of this Section, any Lender may assign and pledge all or
any portion of its Loans and its Notes to any Federal Reserve Bank as collateral
security.  No such assignment shall release the assigning Lender from its
obligations hereunder.

 

(h)A Lender may furnish any information concerning the Borrower, any other Loan
Party or any of their respective Subsidiaries in the possession of such Lender
from time to time to Assignees and Participants (including prospective Assignees
and Participants) subject to compliance with Section 13.8.

 

(i)Anything in this Section to the contrary notwithstanding, no Lender may
assign or participate any interest in any Loan held by it hereunder to the
Borrower, any other Loan Party or any of their respective Affiliates or
Subsidiaries.

 

(j)Each Lender agrees that, without the prior written consent of the Borrower
and the Agent, it will not make any assignment hereunder in any manner or under
any circumstances that would require registration or qualification of, or
filings in respect of, any Loan or Note under the Securities Act or any other
securities laws of the United States of America or of any other jurisdiction.

 

(k)Notwithstanding anything to the contrary contained herein, any Lender (for
purposes of this subsection, a “Granting Lender”) may grant to a special purpose
funding vehicle organized under the laws of the United States of America or any
state thereof and affiliated or sponsored by such Granting Lender or one of its
affiliates (for the purposes of this subsection, an “SPC”) the option to make,
on behalf of such Granting Lender, all or a portion of the Loans

 

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which such Granting Lender is obligated or permitted to make (a “Funding
Obligation”) hereunder, such option to be exercisable in the sole discretion of
the SPC, provided, however, that

(i)such Granting Lender’s obligations under this Agreement and the Loan
Documents shall remain unchanged, including without limitation the
indemnification obligations of the Granting Lender pursuant to Section 12.7.
hereof;

(ii)such Granting Lender shall remain solely responsible to the other parties
hereto for the performance of all Funding Obligations;

(iii)the Borrower, the Lenders and the Agent shall continue to deal solely and
directly with such Granting Lender in connection with such Granting Lender’s
rights and obligations under this Agreement, and the Agent shall continue to
deal solely and directly with the Granting Lender as agent for the SPC with
respect to distribution of payment of principal, interest and fees, Notices of
Conversion and Continuation and all other matters;

(iv)such Granting Lender shall retain the sole right to enforce the obligations
of the Borrower relating to its Loans and its Notes and to approve any
amendment, modification, or waiver of any provisions of this Agreement;

(v)the granting of such option shall not constitute an assignment to or
participation of such SPC of or in the Granting Lender’s Commitment and
Obligations owing thereto;

(vi)such SPC shall not become a Lender nor acquire any rights hereunder as a
result of the granting of such option;

(vii)such SPC shall not become obligated or committed to make Loans as a result
of the granting of such option;

(viii)if such SPC elects not to exercise such option or otherwise fails to make
all or any part of any Loan, the Granting Lender shall retain its Funding
Obligation and be obligated to make the entire Loan or any portion of such Loan
not made by such SPC;

(ix)Loans made by an SPC hereunder shall be deemed to satisfy the Funding
Obligation and utilize the Commitment of the Granting Lender as if, and to the
same extent, such Loans were made by such Granting Lender;

(x)Each party hereto agrees that no SPC shall be liable for any indemnity or
payment under this Agreement for which a Granting Lender would otherwise be
liable so long as, and to the extent, such Loans were made by such Granting
Lender; and

(xi)Each party hereto agrees that, prior to the date that is one year and one
day after the payment in full of all outstanding commercial paper or other
senior indebtedness of any SPC, it will not institute against, or join any other
person in instituting against, such SPC any bankruptcy, reorganization,
arrangement, insolvency or liquidation proceedings under the laws of the United
States or any state thereof.

 

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Section 13.6.  Amendments.

(a)Generally.  Except as otherwise expressly provided in this Agreement, (i) any
consent or approval required or permitted by this Agreement or in any other Loan
Document to be given by the Lenders may be given, and(ii) any term of this
Agreement or of any other Loan Document (other than any fee letter solely
between the Borrower and the Agent) may be amended, and(iii) the performance or
observance by the Borrower, any other Loan Party or any other Subsidiary of any
terms of this Agreement or such other Loan Document (other than any fee letter
solely between the Borrower and the Agentmay be waived, and (iv)  or the
continuance of any Default or Event of Default may be waived (either generally
or in a particular instance and either retroactively or prospectively) with, but
only with, the written consent of the Requisite Lenders (or the Agent at the
written direction of the Requisite Lenders), and, in the case of an amendment to
any Loan Document, the written consent of each Loan Party which is party
thereto).  Notwithstanding the foregoing, no amendment, waiver or consent shall,
unless in writing, and signed by all of the Lenders (or the Agent at the written
direction of the Lenders), do any of the following: (a) increase the Commitments
of the Lenders or subject the Lenders to any additional obligations;

   

(b)Additional Lender Consents.  In addition to the foregoing requirements, no
amendment, waiver or consent shall:

 

(i)increase (or reinstate) the Commitments of a Lender or subject a Lender to
any additional obligations without the written consent of such Lender;

 

(bii)reduce the principal of, or interest rates that havehas accrued or the
rates of interest that will be charged on the outstanding principal amount of,
any Loans or other Obligations; (c) reduce the amount of any Fees payable to the
Lenders hereunder; (d) postpone any date fixed for any payment of any principal
of, interest on, or Fees with respect to, any Loans or any other Obligations;
(e) change the Commitment Percentages (excluding any change as a result of an
assignment of Commitments permitted under Section 13.5.(d) or an increase of
Commitments effected pursuant to Section 2.17.); (f) modify thewithout the
written consent of each Lender directly affected thereby; provided, however,
only the written consent of the Requisite Lenders shall be required for the
waiver of interest payable at the Post-Default Rate, retraction of the
imposition of interest at the Post-Default Rate and amendment of the definition
of the terms “Termination Date” or “Termination DatePost-Default Rate”;

 

(iii)reduce the amount of any Fees payable to a Lender without the written
consent of such Lender;

 

(iv)modify the definition of “Commitment Percentage” without the written consent
of each Lender;

 

(v)modify the definition of “Termination Date”, otherwise postpone any date
fixed for, or forgive, any payment of principal of, or interest on, any Loans or
for the payment of Fees or any other Obligations owing to the Issuing Banks or
the Lenders, or

 

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extend the expiration date of any Letter of Credit beyond the Termination Date,
in each case, without the consent of each Issuing Bank and/or Lender directly
affected thereby;

 

(gvi)amend this Section or amend the definitions of the terms used in this
Agreement or the other Loan Documents insofar as such definitions affect the
substance of this Section without the written consent of each Lender;

 

(hvii)modify the definition of the term “Requisite Lenders” or modify in any
other manner the number or percentage of the Lenders required to make any
determinations or waive any rights hereunder or to modify any provision hereof;
(i) release any Guarantor from its obligations under the Guaranty without the
written consent of each Lender; or

 

(viii)amend, or waive the Borrower’s compliance with, Section 2.18. without the
written consent of each Lender.

 

(except for releases permitted under Sections 8.14.(d)); and (j) waive a Default
or Event of Default under Section 11.1.(a)c)Amendment of Agent’s Duties,
Etc.  No amendment, waiver or consent unless in writing and signed by the Agent,
in addition to the Lenders required hereinabove to take such action, shall
affect the rights or duties of the Agent under this Agreement or any of the
other Loan Documents.  Any amendment, waiver or consent relating to Section 2.4.
or the obligations of the Swingline Lender under this Agreement or any other
Loan Document shall, in addition to the Lenders required hereinabove to take
such action, require the written consent of the Swingline Lender.  Any
amendment, waiver or consent relating to Section 2.3. or the obligations of the
Issuing Banks under this Agreement or any other Loan Document shall, in addition
to the Lenders required hereinabove to take such action, require the written
consent of each Issuing Bank.    Notwithstanding anything to the contrary
herein, no Defaulting Lender shall have any right to approve or disapprove any
amendment, waiver or consent hereunder (and any amendment, waiver or consent
which by its terms requires the consent of all Lenders or each affected Lender
may be effected with the consent of the applicable Lenders other than Defaulting
Lenders), except that (x) the Commitments of any Defaulting Lender may not be
increased, reinstated or extended without the written consent of such Defaulting
Lender and (y) any waiver, amendment or modification requiring the consent of
all Lenders or each affected Lender that by its terms affects any Defaulting
Lender more adversely than other affected Lenders shall require the written
consent of such Defaulting Lender.  No waiver shall extend to or affect any
obligation not expressly waived or impair any right consequent thereon and any
amendment, waiver or consent shall be effective only in the specific instance
and for the specific purpose set forth therein.  No course of dealing or delay
or omission on the part of the Agent or any Lender in exercising any right shall
operate as a waiver thereof or otherwise be prejudicial thereto.  Any Event of
Default occurring hereunder shall continue to exist until such time as such
Event of Default is waived in writing in accordance with the terms of this
Section, notwithstanding any attempted cure or other action by the Borrower, any
other Loan Party or any other Person subsequent to the occurrence of such Event
of Default.  Except as otherwise explicitly provided for herein or in any other
Loan Document, no notice to or demand upon the Borrower shall entitle the
Borrower to other or further notice or demand in similar or other circumstances.
 Notwithstanding anything to the contrary in this Section 13.6. the Agent

 

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shall be authorized, on behalf of the Lenders, to waive the imposition of late
fees in Section 2.9. up to a maximum of 3 times per year.

 

(d)Technical Amendments.    Notwithstanding anything to the contrary in this
Section 13.6., if the Agent and the Borrower have jointly identified an
ambiguity, omission, mistake or defect in any provision of this Agreement or an
inconsistency between provisions of this Agreement, the Agent and the Borrower
shall be permitted to amend such provision or provisions to cure such ambiguity,
omission, mistake, defect or inconsistency so long as to do so would not
adversely affect the interests of the Lenders and the Issuing Banks.  Any such
amendment shall become effective without any further action or consent of any of
other party to this Agreement.

 

Section 13.7.  Nonliability of Agent and Lenders.

The relationship between the Borrower, on the one hand, and the Lenders and the
Agent, on the other hand, shall be solely that of borrower and lender. 
NeitherNone of the Agent nor, the Issuing Banks or any Lender shall have any
fiduciary responsibilities to the Borrower and no provision in this Agreement or
in any of the other Loan Documents, and no course of dealing between or among
any of the parties hereto, shall be deemed to create any fiduciary duty owing by
the Agent, any Issuing Bank or any Lender to any Lender, any other Issuing Bank,
the Borrower, any Subsidiary or any other Loan Party.  NeitherNone of the Agent
nor, any Issuing Bank or any Lender undertakes any responsibility to the
Borrower to review or inform the Borrower of any matter in connection with any
phase of the Borrower’s business or operations.

 

Section 13.8.  Confidentiality.

Except as otherwise provided by Applicable Law, the Agent, each Issuing Bank and
each Lender shall utilize all non‑public information obtained pursuant to the
requirements of this Agreement which has been identified as confidential or
proprietary by the Borrower in accordance with its customary procedure for
handling confidential information of this nature and in accordance with safe and
sound banking practices but in any event may make disclosure: (a) to any of
their respective affiliates, agents or advisors (provided any such affiliate,
agent or advisor shall agree to keep such information confidential in accordance
with the terms of this Section); (b) as reasonably requested by any bona fide
actual or potential Assignee, Participant or other transferee in connection with
the contemplated transfer of any Commitment or participations therein as
permitted hereunder (provided they shall agree to keep such information
confidential in accordance with the terms of this Section); (c) as required or
requested by any Governmental Authority or representative thereof or pursuant to
legal process or in connection with any legal proceedings; (d) to the Agent’s,
such Issuing Bank’s or such Lender’s independent auditors and other professional
advisors (provided they shall be notified of the confidential nature of the
information); (e) if an Event of Default exists, to any other Person, in
connection with the exercise by the Agent, the Issuing Banks or the Lenders of
rights hereunder or under any of the other Loan Documents; and (f) to the extent
such information (x) becomes publicly available other than as a result of a
breach of this Section or (y) becomes available to the Agent, any Issuing Bank
or any Lender on a nonconfidential basis from a source other than the Borrower
or any Affiliate, and (g) with the consent of the Borrower.

 

 

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Section 13.9.  Indemnification.

(a)The Borrower shall and hereby agrees to indemnify, defend and hold harmless
the Agent and each Issuing Bank, any affiliate of the Agent or such Issuing
Bank, and each of the Lenders and their respective affiliates, parents,
directors, officers, shareholders, agents, employees and counsel (each referred
to herein as an “Indemnified Party”) from and against any and all losses, costs,
claims, damages, liabilities, deficiencies, judgments or expenses of every kind
and nature (including, without limitation, amounts paid in settlement, court
costs and the fees and disbursements of counsel incurred in connection with any
litigation, investigation, claim or proceeding or any advice rendered in
connection therewith, but excluding losses, costs, claims, damages, liabilities,
deficiencies, judgments or expenses indemnification in respect of which is
specifically covered by Section 3.11. or 5.1. or expressly excluded from the
coverage of such Sections) incurred by an Indemnified Party in connection with,
arising out of, or by reason of, any suit, cause of action, claim, arbitration,
investigation or settlement, consent decree or other proceeding (the foregoing
referred to herein as an “Indemnity Proceeding”) which is in any way related
directly or indirectly to: (i) this Agreement or any other Loan Document or the
transactions contemplated thereby; (ii) the making of any Loans or issuance of
Letters of Credit hereunder; (iii) any actual or proposed use by the Borrower of
the proceeds of the Loans or Letters of Credit; (iv) the Agent’s, any Issuing
Bank’s or any Lender’s entering into this Agreement; (v) the fact that the
Agent, the Issuing Banks and the Lenders have established the credit facility
evidenced hereby in favor of the Borrower; (vi) the fact that the Agent, the
Issuing Banks and the Lenders are creditors of the Borrower and have or are
alleged to have information regarding the financial condition, strategic plans
or business operations of the Borrower and the Subsidiaries; (vii) the fact that
the Agent, the Issuing Banks and the Lenders are material creditors of the
Borrower and are alleged to influence directly or indirectly the business
decisions or affairs of the Borrower and the Subsidiaries or their financial
condition; (viii) the exercise of any right or remedy the Agent, the Issuing
Banks or the Lenders may have under this Agreement or the other Loan Documents;
provided, however, that the Borrower shall not be obligated to indemnify any
Indemnified Party for any acts or omissions of such Indemnified Party in
connection with matters described in this clause (viii) that constitute gross
negligence or willful misconduct; or (ix) any violation or non‑compliance by the
Borrower or any Subsidiary of any Applicable Law (including any Environmental
Law) including, but not limited to, any Indemnity Proceeding commenced by
(A) the Internal Revenue Service or state taxing authority or (B) any
Governmental Authority or other Person under any Environmental Law, including
any Indemnity Proceeding commenced by a Governmental Authority or other Person
seeking remedial or other action to cause the Borrower or its Subsidiaries (or
its respective properties) (or the Agent, the Issuing Banks and/or the Lenders
as successors to the Borrower) to be in compliance with such Environmental
Laws.; provided, however, that the Borrower shall not be obligated to indemnify
any Indemnified Party for any acts or omissions of such Indemnified Party in
connection with matters described in this clause (a) that constitute gross
negligence or willful misconduct of such Indemnified Party.

 

(b)The Borrower’s indemnification obligations under this Section shall apply to
all Indemnity Proceedings arising out of, or related to, the foregoing whether
or not an Indemnified Party is a named party in such Indemnity Proceeding.  In
this connection, this indemnification shall cover all costs and expenses of any
Indemnified Party in connection with any deposition of any Indemnified Party or
compliance with any subpoena (including any subpoena requesting the

 

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production of documents).  This indemnification shall, among other things, apply
to any Indemnity Proceeding commenced by other creditors of the Borrower or any
Subsidiary, any shareholder of the Borrower or any Subsidiary (whether such
shareholder(s) are prosecuting such Indemnity Proceeding in their individual
capacity or derivatively on behalf of the Borrower), any account debtor of the
Borrower or any Subsidiary or by any Governmental Authority.

 

(c)This indemnification shall apply to any Indemnity Proceeding arising during
the pendency of any bankruptcy proceeding filed by or against the Borrower
and/or any Subsidiary.

 

(d)All out‑of‑pocket fees and expenses of, and all amounts required to be paid
to third‑persons by, an Indemnified Party in connection with this Agreement or
any of the other Loan Documents shall be advanced by the Borrower at the request
of such Indemnified Party notwithstanding any claim or assertion by the Borrower
that such Indemnified Party is not entitled to indemnification hereunder upon
receipt of an undertaking by such Indemnified Party that such Indemnified Party
will reimburse the Borrower if it is actually and finally determined by a court
of competent jurisdiction in a nonappealable judgment that such Indemnified
Party is not so entitled to indemnification hereunder.

 

(e)An Indemnified Party may conduct its own investigation and defense of, and
may formulate its own strategy with respect to, any Indemnity Proceeding covered
by this Section and, as provided above, all costs and expenses incurred by such
Indemnified Party shall be reimbursed by the Borrower.  No action taken by legal
counsel chosen by an Indemnified Party in investigating or defending against any
such Indemnity Proceeding shall vitiate or in any way impair the obligations and
duties of the Borrower hereunder to indemnify and hold harmless each such
Indemnified Party; provided, however, that (i) if the Borrower is required to
indemnify an Indemnified Party pursuant hereto and (ii) the Borrower has
provided evidence reasonably satisfactory to such Indemnified Party that the
Borrower has the financial wherewithal to reimburse such Indemnified Party for
any amount paid by such Indemnified Party with respect to such Indemnified
Proceeding, such Indemnified Party shall not settle or compromise any such
Indemnified Proceeding without the prior written consent of the Borrower (which
consent shall not be unreasonably withheld or delayed).

 

(f)If and to the extent that the obligations of the Borrower hereunder are
unenforceable for any reason, the Borrower hereby agrees to make the maximum
contribution to the payment and satisfaction of such obligations which is
permissible under Applicable Law.

 

(g)The Borrower’s obligations hereunder shall survive any termination of this
Agreement and the other Loan Documents and the payment in full in cash of the
Obligations, and are in addition to, and not in substitution of, any other of
their obligations set forth in this Agreement or any other Loan Document to
which it is a party.

 

Section 13.10.  Termination; Survival.

At such time as (a) all of the Commitments have been terminated, (b) none of the
Lenders is obligated any longer under this Agreement to make any Loans and
(c) all Obligations (other than obligations which survive as provided in the
following sentence) have been paid and satisfied in full, this Agreement shall
terminate. The indemnities to which the Agent, the Issuing

 

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Banks and the Lenders are entitled under the provisions of Sections 3.12., 5.1.,
5.4., 12.7., 13.2. and 13.9. and any other provision of this Agreement and the
other Loan Documents, and the provisions of Section 13.4., shall continue in
full force and effect and shall protect the Agent, the Issuing Banks and the
Lenders (i) notwithstanding any termination of this Agreement, or of the other
Loan Documents, against events arising after such termination as well as before
and (ii) at all times after any such party ceases to be a party to this
Agreement with respect to all matters and events existing on or prior to the
date such party ceased to be a party to this Agreement.

 

Section 13.11.  Severability of Provisions.

Any provision of this Agreement which is prohibited or unenforceable in any
jurisdiction shall, as to such jurisdiction, be ineffective only to the extent
of such prohibition or unenforceability without invalidating the remainder of
such provision or the remaining provisions or affecting the validity or
enforceability of such provision in any other jurisdiction.

 

Section 13.12.  GOVERNING LAW.

THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS
OF THE STATE OF CALIFORNIA APPLICABLE TO CONTRACTS EXECUTED, AND TO BE FULLY
PERFORMED, IN SUCH STATE.

 

Section 13.13.  Counterparts.

This Agreement and any amendments, waivers, consents or supplements may be
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of which when so executed and delivered shall be
deemed an original, but all of which counterparts together shall constitute but
one and the same instrument.

 

Section 13.14.  Obligations with Respect to Loan Parties.

The obligations of the Borrower to direct or prohibit the taking of certain
actions by the other Loan Parties as specified herein shall be absolute and not
subject to any defense the Borrower may have that the Borrower does not control
such Loan Parties.

 

Section 13.15.  Marshaling; Payments Set Aside.

NeitherNone of the Agent nor, any Issuing Bank or any Lender shall be under any
obligation to marshal any assets in favor of any Loan Party or any other party
or against or in payment of any or all of the Obligations.  To the extent that
any Loan Party makes a payment or payments to the Agent, any Issuing Bank and/or
any Lender, or the Agent, any Issuing Bank and/or any Lender enforce their
security interests or exercise their rights of setoff, and such payment or
payments or the proceeds of such enforcement or setoff or any part thereof are
subsequently invalidated, declared to be fraudulent or preferential, set aside
and/or required to be repaid to a trustee, receiver or any other party under any
bankruptcy law, state or federal law, common law or equitable cause, then to the
extent of such recovery, the Obligations or part thereof originally intended to
be satisfied, and all Liens, rights and remedies therefor, shall be

 

-  106  -

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revived and continued in full force and effect as if such payment had not been
made or such enforcement or setoff had not occurred.

 

Section 13.16.  Independence of Covenants.

All covenants hereunder shall be given in any jurisdiction independent effect so
that if a particular action or condition is not permitted by any of such
covenants, the fact that it would be permitted by an exception to, or be
otherwise within the limitations of, another covenant shall not avoid the
occurrence of a Default or an Event of Default if such action is taken or
condition exists.

 

Section 13.17.  Limitation of Liability.

NeitherNone of the Agent nor, any Issuing Bank or any Lender, nor any affiliate,
officer, director, employee, attorney, or agent of the Agent, any Issuing Bank
or any Lender shall have any liability with respect to, and the Borrower hereby
waives, releases, and agrees not to sue any of them upon, any claim for any
special, indirect, incidental, or consequential damages suffered or incurred by
the Borrower in connection with, arising out of, or in any way related to, this
Agreement or any of the other Loan Documents, or any of the transactions
contemplated by this Agreement or any of the other Loan Documents.  The Borrower
hereby waives, releases, and agrees not to sue the Agent, any Issuing Bank or
any Lender or any of the Agent’s, any Issuing Bank’s or any Lender’s affiliates,
officers, directors, employees, attorneys, or agents for punitive damages in
respect of any claim in connection with, arising out of, or in any way related
to, this Agreement or any of the other Loan Documents, or any of the
transactions contemplated by this Agreement or financed hereby.

 

Section 13.18.  Entire Agreement.

This Agreement, the Notes, and the other Loan Documents referred to herein
embody the final, entire agreement among the parties hereto and supersede any
and all prior commitments, agreements, representations, and understandings,
whether written or oral, relating to the subject matter hereof and thereof and
may not be contradicted or varied by evidence of prior, contemporaneous, or
subsequent oral agreements or discussions of the parties hereto.  There are no
oral agreements among the parties hereto.

 

Section 13.19.  Construction.

The Agent, the Borrower, each Issuing Bank and each Lender acknowledge that each
of them has had the benefit of legal counsel of its own choice and has been
afforded an opportunity to review this Agreement and the other Loan Documents
with its legal counsel and that this Agreement and the other Loan Documents
shall be construed as if jointly drafted by the Agent, the Issuing Banks, the
Borrower and each Lender.

 

Section 13.20.  Electronic Document Delivery.

(a)Documents required to be delivered pursuant to the Loan Documents shall be
delivered by electronic communication and delivery, including, the Internet,
e-mail or intranet

 

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websites to which the Agent and each Lender have access (including a commercial,
third-party website such as www.sec.gov <http://www.sec.gov> or a website
sponsored or hosted by the Agent or the Borrower) provided that (A) the
foregoing shall not apply to notices to any Lender, any Issuing Bank or the
Agent pursuant to Article II. and (B) the applicable Lender or Issuing Bank has
not notified the Agent or Borrower that it cannot or does not want to receive
electronic communications.  The Agent or the Borrower may, in its discretion,
agree to accept notices and other communications to it hereunder by electronic
delivery pursuant to procedures approved by it for all or particular notices or
communications.  Documents or notices delivered electronically shall be deemed
to have been delivered twenty-four (24) hours after the date and time on which
the Agent or Borrower posts such documents or the documents become available on
a commercial website and the Agent or Borrower notifies each Lender of said
posting and provides a link thereto provided if such notice or other
communication is not sent or posted during the normal business hours of the
recipient, said posting date and time shall be deemed to have commenced as
of  9:00 a.m. on the opening of business on the next business day for the
recipient.  Notwithstanding anything contained herein, in every instance the
Borrower shall be required to provide paper copies of the certificate required
by Section 9.3. to the Agent and shall deliver paper copies of any documents to
the Agent, any Issuing Bank or to any Lender that requests such paper copies
until a written request to cease delivering paper copies is given by the Agent,
such Issuing Bank or such Lender.  Except for the certificates required by
Section 9.3., the Agent shall have no obligation to request the delivery of or
to maintain paper copies of the documents delivered electronically, and in any
event shall have no responsibility to monitor compliance by the Borrower with
any such request for delivery.  Each Lender and each Issuing Bank shall be
solely responsible for requesting delivery to it of paper copies and maintaining
its paper or electronic documents.

 

(b)The Borrower agrees that the Agent may make any material delivered by the
Borrower to the Agent, as well as any amendments, waivers, consents, and other
written information, documents, instruments and other materials relating to the
Borrower, any of its Subsidiaries, or any other materials or matters relating to
this Agreement, the Notes or any of the transactions contemplated hereby
(collectively, the “Communications”) available to the Issuing Banks and the
Lenders by posting such notices on an electronic delivery system (which may be
provided by the Agent, an affiliate of the Agent, or any Person that is not an
affiliate of the Agent), such as IntraLinks, or a substantially similar
electronic system (the “Platform”).  The Borrower acknowledges that (i) the
distribution of material through an electronic medium is not necessarily secure
and that there are confidentiality and other risks associated with such
distribution, (ii) the Platform is provided “as is” and “as available” and (iii)
neither the Agent nor any of its affiliates warrants the accuracy, completeness,
timeliness, sufficiency, or sequencing of the Communications posted on the
Platform.  The Agent and its affiliates expressly disclaim with respect to the
Platform any liability for errors in transmission, incorrect or incomplete
downloading, delays in posting or delivery, or problems accessing the
Communications posted on the Platform and any liability for any losses, costs,
expenses or liabilities that may be suffered or incurred in connection with the
Platform.  No warranty of any kind, express, implied or statutory, including,
without limitation, any warranty of merchantability, fitness for a particular
purpose, non-infringement of third party rights or freedom from viruses or other
code defects, is made by the Agent or any of its affiliates in connection with
the Platform.

 

 

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(c)Each Lender and each Issuing Bank agrees that notice to it (as provided in
the next sentence) (a “Notice”) specifying that any Communication has been
posted to the Platform shall for purposes of this Agreement constitute effective
delivery to such Lender or such Issuing Bank of such information, documents or
other materials comprising such Communication.  Each Lender and each Issuing
Bank agrees (i) to notify, on or before the date such Lender becomes a party to
this Agreement, the Agent in writing of such Lender’s or such Issuing Bank’s
e-mail address to which a Notice may be sent (and from time to time thereafter
to ensure that the Agent has on record an effective e-mail address for such
Lender) and (ii) that any Notice may be sent to such e-mail address.

 

(d)Notwithstanding anything to the contrary herein, documents and notices
required to be delivered by the Loan Parties pursuant to the Loan Documents
shall be deemed delivered by, and delivery effective at the time of, the public
filing of the same in electronic format with the SEC or by posting the same on
the Borrower’s website to which the Agent, each Issuing Bank and each Lender
have access.

 

Section 13.21.  Patriot Act.

The USA Patriot Act of 2001 (Public Law 107-56) and federal regulations issued
with respect thereto require all financial institutions to obtain, verify and
record certain information that identifies individuals or business entities
which open an “account” with such financial institution. Consequently, theeach
Lender hereunder may from time to time request, and the Borrower shall provide
to thesuch Lender, the Borrower’s name, address, tax identification number
and/or such other identification information as shall be necessary for thesuch
Lender to comply with federal law. An “account” for this purpose may include,
without limitation, a deposit account, cash management service, a transaction or
asset account, a credit account, a loan or other extension of credit, and/or
other financial services product.

 

Section 13.22.  Effect of Existing Credit Agreement.

(a)Existing Credit Agreement.  Upon satisfaction of the conditions precedent set
forth in Sections 6.1. and 6.2. of this Agreement, this Agreement shall
exclusively control and govern the mutual rights and obligations of the parties
hereto with respect to the Existing Credit Agreement, and the Existing Credit
Agreement shall be superseded by this Agreement in all respects, in each case,
on a prospective basis only. 

 

(b)NO NOVATION.  THE PARTIES HERETO HAVE ENTERED INTO THIS AGREEMENT SOLELY TO
AMEND AND RESTATE THE TERMS OF, AND THE OBLIGATIONS OWING UNDER AND IN
CONNECTION WITH, THE EXISTING CREDIT AGREEMENT.  THE PARTIES DO NOT INTEND THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY TO BE, AND THIS AGREEMENT AND
THE TRANSACTIONS CONTEMPLATED HEREBY SHALL NOT BE CONSTRUED TO BE, A NOVATION OF
ANY OF THE OBLIGATIONS OWING BY THE BORROWER UNDER OR IN CONNECTION WITH THE
EXISTING CREDIT AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS (AS DEFINED IN THE
EXISTING CREDIT AGREEMENT).

 

 

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[Signatures on Following Pages]

 

 

-  110  -

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IN WITNESS WHEREOF, the parties hereto have caused this Amended and Restated
Credit Agreement to be executed by their authorized officers all as of the day
and year first above written.

 

Borrower:

 

PUBLIC STORAGE

 

 

By:___________________________________________________________________________________________

    Name:___________________________________________________________________________________

    Title:_____________________________________________________________________________________

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signatures Continued on Next Page]

 

 

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Signature Page to Amended and Restated Credit Agreement with Public Storage

 

 

WELLS FARGO BANK, NATIONAL ASSOCIATION, as the Agent, as the Swingline Lender
and as a Lender

 

 

By:___________________________________________________________________________________________

    Name:___________________________________________________________________________________

    Title:_____________________________________________________________________________________

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[Signatures Continued on Next Page]

 

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Signature Page to Amended and Restated Credit Agreement with Public Storage

 

 

BANK OF AMERICA, N.A.

 

 

By:___________________________________________________________________________________________

    Name:___________________________________________________________________________________

    Title:_____________________________________________________________________________________

 

 

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Signature Page to Amended and Restated Credit Agreement with Public Storage

 

 

MORGAN STANLEY BANK, N.A.

 

 

By:___________________________________________________________________________________________

    Name:___________________________________________________________________________________

    Title:_____________________________________________________________________________________

 

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Signature Page to Amended and Restated Credit Agreement with Public Storage

 

 

UBS LOAN FINANCE LLC

 

 

By:___________________________________________________________________________________________

    Name:___________________________________________________________________________________

    Title:_____________________________________________________________________________________

 

 

 

By:___________________________________________________________________________________________

    Name:___________________________________________________________________________________

    Title:_____________________________________________________________________________________

 

 

 

 

 

 

 

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EXECUTION COPY

Picture 8 [psa-20150402ex101b87553g001.jpg]

 

 

 

 

 

CREDIT AGREEMENT

 

 

Dated as of March 21, 2012

 

 

by and among

 

PUBLIC STORAGE,

as Borrower,

 

The financial institutions party hereto

and their assignees under Section 13.5.,

       as Lenders,

 

WELLS FARGO SECURITIES, LLC

and

MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED,

as Joint Lead Arrangers and

       Joint Bookrunners,

 

WELLS FARGO Bank, National Association,

      as Administrative Agent,

 

and

BANK OF AMERICA, N.A.

as Syndication Agent

 

 

 

 

 

 

 

 

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TABLE OF CONTENTS

 

Article I.
Definitions.....................................................................................................1

Section 1.1.  Definitions................................................................................................1

Section 1.2.  General; References to San Francisco
Time......................................................28

Article II. Credit
Facilities...........................................................................................29

Section 2.1.  Revolving
Loans......................................................................................29

Section 2.2.  Bid Rate
Loans......................................................................................30

Section 2.3.  Letters of
Credit......................................................................................33

Section 2.4.  Swingline
Loans......................................................................................38

Section 2.5.  Rates and Payment of Interest on
Loans..........................................................40

Section 2.6.  Number of Interest
Periods........................................................................41

Section 2.7.  Repayment of
Loans................................................................................41

Section 2.8.  Prepayments..........................................................................................41

Section 2.9.  [Intentionally
Omitted]..............................................................................42

Section 2.10.  Continuation........................................................................................42

Section 2.11.  Conversion..........................................................................................43

Section 2.12.  Notes................................................................................................43

Section 2.13.  Voluntary Reductions of the
Commitment......................................................43

Section 2.14.  [Intentionally
Omitted]............................................................................44

Section 2.15.  [Intentionally
Omitted]............................................................................44

Section 2.16.  Expiration or Maturity Date of Letters of Credit Past Termination
of Facility..............44

Section 2.17.  Increase in
Commitments..........................................................................44

Section 2.18.  Amount
Limitations................................................................................45

Article III. Payments, Fees and Other General
Provisions.....................................................45

Section 3.1.  Payments..............................................................................................45

Section 3.2.  Pro Rata
Treatment..................................................................................46

Section 3.3.  Sharing of Payments,
Etc............................................................................46

Section 3.4.  Several
Obligations..................................................................................47

Section 3.5.  Minimum
Amounts..................................................................................47

Section 3.6.  Fees....................................................................................................47

Section 3.7.  Computations........................................................................................48

Section 3.8.  Usury..................................................................................................48

Section 3.9.  Statements of
Account..............................................................................49

Section 3.10.  Defaulting
Lenders..................................................................................49

Section 3.11.  Taxes................................................................................................53

Article IV.  [Intentionally
omitted]..................................................................................54

Article V. Yield Protection,
Etc....................................................................................54

Section 5.1.  Additional Costs; Capital
Adequacy..............................................................54

Section 5.2.  Suspension of LIBOR Loans and LIBOR Margin
Loans......................................56

Section 5.3.  Illegality................................................................................................57

Section 5.4.  Compensation........................................................................................57

 

 

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Section 5.5.  Treatment of Affected
Loans......................................................................58

Section 5.6.  Affected
Lenders....................................................................................58

Section 5.7.  Change of Lending
Office..........................................................................59

Section 5.8.  Assumptions Concerning Funding of LIBOR
Loans............................................59

Article VI. Conditions
Precedent.................................................................................59

Section 6.1.  Initial Conditions
Precedent........................................................................59

Section 6.2.  Conditions Precedent to All Loans and Letters of
Credit......................................61

Section 6.3. [Intentionally
Omitted]................................................................................62

Section 6.4.  Conditions as
Covenants............................................................................62

Article VII. Representations and
Warranties.....................................................................62

Section 7.1.  Representations and
Warranties....................................................................62

Section 7.2.  Survival of Representations and Warranties,
Etc................................................68

Article VIII. Affirmative
Covenants...............................................................................68

Section 8.1.  Preservation of Existence and Similar
Matters..................................................69

Section 8.2.  Compliance with Applicable
Law..................................................................69

Section 8.3.  Maintenance of
Property............................................................................69

Section 8.4.  Conduct of
Business................................................................................69

Section 8.5.  Insurance..............................................................................................69

Section 8.6.  Payment of Taxes and
Claims......................................................................70

Section 8.7.  Books and Records;
Inspections..................................................................70

Section 8.8.  Use of
Proceeds......................................................................................70

Section 8.9.  Environmental
Matters..............................................................................71

Section 8.10.  Further
Assurances................................................................................71

Section 8.11.  [Intentionally
Omitted]............................................................................71

Section 8.12.  [Intentionally
Omitted]............................................................................71

Section 8.13.  Exchange
Listing....................................................................................71

Section 8.14.  [Intentionally
Omitted].............................................................................71

Article IX.
Information.............................................................................................72

Section 9.1.  Quarterly Financial
Statements....................................................................72

Section 9.2.  Year‑End
Statements..................................................................................72

Section 9.3.  Compliance
Certificate..............................................................................72

Section 9.4.  Other
Information....................................................................................73

Article X. Negative
Covenants.....................................................................................74

Section 10.1.  Financial
Covenants................................................................................74

Section 10.2.  Indebtedness........................................................................................76

Section 10.3.  [Intentionally
Omitted]............................................................................76

Section 10.4.  [Intentionally
Omitted]............................................................................76

Section 10.5.  Merger, Consolidation, Sales of Assets, Acquisitions and Other
Arrangements..........76

Section 10.6.  [Intentionally
Deleted]..............................................................................77

Section 10.7.  Fiscal
Year..........................................................................................77

Section 10.8.  Modifications of Organizational
Documents....................................................77

-2-

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Section 10.9.  [Intentionally
Omitted]............................................................................77

Article XI.
Default...................................................................................................78

Section 11.1.  Events of
Default....................................................................................78

Section 11.2.  Remedies Upon Event of
Default................................................................80

Section 11.3.  Remedies Upon
Default............................................................................82

Section 11.4.  Marshaling; Payments Set
Aside..................................................................82

Section 11.5.  Allocation of
Proceeds............................................................................82

Section 11.6.  Letter of Credit Collateral
Account..............................................................83

Section 11.7.  Performance by
Agent............................................................................84

Section 11.8.  Rights
Cumulative..................................................................................84

Article XII. The
Agent...............................................................................................84

Section 12.1.  Authorization and
Action..........................................................................84

Section 12.2.  Agent’s Reliance,
Etc..............................................................................85

Section 12.3.  Notice of
Defaults..................................................................................86

Section 12.4.  Wells Fargo as
Lender............................................................................86

Section 12.5.  Approvals of
Lenders..............................................................................86

Section 12.6.  Lender Credit Decision,
Etc......................................................................87

Section 12.7.  Indemnification of
Agent..........................................................................87

Section 12.8.  Successor
Agent....................................................................................88

Section 12.9.  Titled
Agents........................................................................................89

Section 12.10.  Intentionally
Omitted..............................................................................89

Article XIII.
Miscellaneous.........................................................................................89

Section 13.1.  Notices..............................................................................................89

Section 13.2.  Expenses............................................................................................91

Section 13.3.  Setoff................................................................................................92

Section 13.4.  Litigation; Jurisdiction; Other Matters;
Waivers................................................92

Section 13.5.  Successors and
Assigns............................................................................93

Section 13.6.  Amendments........................................................................................97

Section 13.7.  Nonliability of Agent and
Lenders................................................................99

Section 13.8.  Confidentiality......................................................................................99

Section 13.9.  Indemnification..................................................................................100

Section 13.10.  Termination;
Survival..........................................................................101

Section 13.11.  Severability of
Provisions....................................................................102

Section 13.12.  GOVERNING
LAW........................................................................102

Section 13.13.  Counterparts....................................................................................102

Section 13.14.  Obligations with Respect to Loan
Parties..................................................102

Section 13.15.  Marshaling; Payments Set
Aside............................................................102

Section 13.16.  Independence of
Covenants..................................................................103

Section 13.17.  Limitation of
Liability..........................................................................103

Section 13.18.  Entire
Agreement..............................................................................103

Section 13.19.  Construction....................................................................................103

Section 13.20.  Electronic Document
Delivery................................................................104

Section 13.21.  Patriot
Act......................................................................................105

Section 13.22.  Effect of Existing Credit
Agreement........................................................105

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SCHEDULE 1.1List of Loan Parties

SCHEDULE 2.3(l)Existing Letters of Credit

SCHEDULE 7.1(b)Ownership Structure

SCHEDULE 7.1(g)Existing Indebtedness

SCHEDULE 10.4Restrictions on Intercompany Transfers

SCHEDULE 10.9Transactions with Affiliates

 

EXHIBIT AForm of Assignment and Acceptance Agreement

EXHIBIT BForm of Guaranty

EXHIBIT CForm of Notice of Borrowing

EXHIBIT DForm of Notice of Continuation

EXHIBIT EForm of Notice of Conversion

EXHIBIT FForm of Notice of Swingline Borrowing

EXHIBIT GForm of Swingline Note

EXHIBIT H[Reserved]

EXHIBIT IForm of Revolving Note

EXHIBIT JForm of Compliance Certificate

EXHIBIT KForm of Bid Rate Note

EHXIBIT LForm of Bid Rate Quote Request

EXHIBIT MForm of Bid Rate Quote

EXHIBIT N    Form of Bid Rate Quote Acceptance

 

 

 

 

-4-

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SCHEDULE I

Commitments

Lender

Commitment Amount

Wells Fargo Bank, National Association

$130,000,000

Bank of America, N.A.

$90,000,000

Morgan Stanley Bank, N.A.

$40,000,000

UBS Loan Finance LLC

$40,000,000

Total

$300,000,000

 

 

 

 

 

 

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