Document:

Employment Agreement between Riddell Bell Holdings, Inc. and William N. Fry

 EMPLOYMENT AGREEMENT 
  
 THIS EMPLOYMENT AGREEMENT (this “Agreement”) is between WILLIAM N. FRY (the
“Executive”) and RIDDELL BELL HOLDINGS, INC., a Delaware corporation (the “Company”). 
  
 WHEREAS, prior to the acquisition of Bell Sports Corp. pursuant to the Agreement and Plan of Merger by and among the Company, Riddell Holdings,
LLC, Bell Sports Corp. and certain other parties named therein (the “Merger Agreement”), Riddell Holdings, LLC was engaged primarily in the business of designing, producing, distributing, marketing, advertising and selling football
helmets, football accessories and related products; 
  
 WHEREAS, prior to said acquisition, the Executive was employed as the President and Chief Executive Officer of Bell Sports Corp., a corporation engaged primarily in the business of designing, producing, distributing, marketing,
advertising and selling bicycle helmets, bicycle accessories and related products; and 
  
 WHEREAS, the Company and the Executive desire to enter into this Agreement to provide for the employment of the Executive by the Company following the Closing Date (as that term is defined in the Merger
Agreement) upon the terms and subject to the conditions set forth herein. 
  
 NOW, THEREFORE, in consideration of the premises and the mutual agreements contained herein, the parties hereby agree as follows: 
  
 1. Employment; Term. The Company hereby employs the Executive and the Executive hereby agrees to be employed by the
Company upon the terms and subject to the conditions contained in this Agreement. Subject to earlier termination as provided in Section 4 hereof, this Agreement shall have an initial term of two (2) years, commencing on the Closing Date, September
30, 2004, (the “Effective Date”), immediately following the Closing (as that term is defined in the Merger Agreement), and shall automatically be renewed thereafter for successive terms of two (2) years each. As used herein, the
term “Employment Period” shall mean the period from the Effective Date until the termination of the Executive’s employment hereunder pursuant to Section 4 hereof. 
  
 2. Position; Duties: Responsibilities. 
  
 2.1 Position; Duties and Responsibilities. During the Employment Period, the Company shall employ the
Executive as its President and Chief Executive Officer, reporting to the Board of Directors of the Company (the “Board”) or such designee as it shall determine in good faith. The Executive shall faithfully and loyally perform to the best
of his abilities all the duties and responsibilities reasonably assigned to him by the Board or such designee; shall devote such business time, attention and effort to the affairs of the Company as is reasonably necessary for the proper performance
of such duties and responsibilities; and shall use his reasonable best efforts to promote the interests of the Company and its Affiliates. The Executive’s duties and responsibilities shall include those he was performing for Bell Sports Inc.
and its Affiliates (collectively “Bell”) immediately prior to the Closing as well as duties for the Company and the affiliated Riddell entities (collectively, including the Company, “Riddell”). 

  

 
Notwithstanding the foregoing, the Executive may serve as a director or officer of business corporations other than the Company or civic or community
organizations or entities, provided that such activities do not violate the terms of any of the covenants set forth in Sections 6, 7 and 8 hereof and do not interfere with his duties and responsibilities hereunder. Current activities of the
Executive coming within the scope of the immediately preceding sentence are listed on Schedule 2.1 hereto. 
  
 2.2 Directorship. The Company shall take all actions reasonably necessary to elect the Executive to the Board during the Employment
Period. At the request of the Board, upon his termination of employment with the Company for any reason, the Executive shall resign as a member of the Board and as an officer of the Company and shall resign from any other position he may have with
the Company or any of its Affiliates. 
  
 3. Compensation.

  
 3.1 Base Salary. During the Employment
Period, the Company shall pay to the Executive an annual base salary at the rate of $450,000 per annum, payable in accordance with the payroll policies of the Company for its executives. Commencing January 1, 2006, (January 1 being the first day of
the Company’s fiscal year), such base salary shall be reviewed annually at the beginning of each fiscal year during the Employment Period (each, a “Fiscal Year”) by the Compensation Committee of the Board and may be increased
(but shall not be decreased) in the sole discretion of the Board or, at its designation, the Compensation Committee. The Executive’s base salary, as such base salary may be increased during the Employment Period, is referred to hereafter as the
“Base Salary.” 
  
 3.2 Annual
Performance Bonus. 
  
 (a) Beginning on the
Effective Date, for each Fiscal Year, the Executive shall be eligible to receive, in addition to the Base Salary, a bonus (the “Bonus”) for services rendered during such Fiscal Year in accordance with this Section 3.2. For Fiscal
Year 2004, the Bonus will be based on the Bell Sports, Inc. annual cash bonus plan covering the Executive at the time the Merger Agreement was signed, and shall be payable in the second quarter of 2005. 
  
 (b) For each Fiscal Year after Fiscal Year 2004 during the
Employment Period, the Executive shall be eligible to participate in the Company’s executive incentive plan for the combined business of Riddell and Bell (as those terms are defined in Section 2.1 above) in accordance with the terms of that
plan. The Executive shall have a target bonus under that plan equal to 80 % of Base Salary and shall be entitled to additional bonus compensation equal to 25% of such target bonus for performance of 10% or more above plan (i.e., a total bonus
opportunity equal to 100% of Base Salary). Compensation awarded the Executive under the executive incentive plan is referred to hereafter as the “Annual Bonus.” The amount of the Annual Bonus shall be determined by the Board or, if so
delegated, the Compensation Committee, based on its assessment of the achievement of reasonable agreed targets appropriately adjusted to account for any agreed long-term investments by the Company. 
  

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 (c) Each Annual Bonus to which the Executive becomes entitled, other than the Fiscal Year
2004 Bonus, shall be paid 30 days following the rendering of audited financial statements for the relevant Fiscal Year (the “Payment Date”). For the avoidance of doubt, except as otherwise provided in Section 4 of this Agreement,
the Executive shall be entitled to receive Annual Bonuses referred to in this Section 3.2 only if he was employed by the Company at the time of the Company’s distribution of bonuses to executives of the Company for the applicable year.

  
 3.3 Equity Participation. 

 
 (a) During the Employment Period, the Executive shall be
eligible to participate in the Riddell Holdings, LLC 2003 Equity Incentive Plan, as amended (the “Equity Incentive Plan”), in accordance with the terms thereof. The Executive’s allocation is 5,073,655.035 Class B Common Units, subject
to the vesting terms set forth in the certificate granting him such units. 
  
 (b) If the Executive’s employment is terminated by the Company without Cause or if the Executive terminates his employment for Good Reason, in each case during the second-half of any calendar year, all of the
EBITDA Units and Earn-Back Units that were eligible for vesting in the year of such termination or resignation shall vest on the Release Date for such year if the respective EBITDA targets for such year are achieved, and otherwise shall expire and
terminate, and all of the Time Units that were eligible for vesting in such year shall vest upon such termination. 
  
 (c) In connection with any repurchase of the Executive’s vested Units by Riddell Holdings, LLC pursuant to the exercise of a Call
Option or Put Option, if the Executive provides the Board of Managers of Riddell Holdings, LLC with written notice of the Executive’s objection to the Board of Managers’ determination of the Fair Market Value of such Units, an independent
investment banking firm chosen in good faith by the Board of Managers shall be commissioned to determine the fair market value of such Units. If such investment banking firm’s determination of the fair market value of such Units is greater than
110% of the Board of Managers’ determination of the Fair Market Value of such Units, then the fees and expenses of such investment banking firm shall be paid by Riddell Holdings, LLC, and otherwise such fees and expenses shall be paid by the
Executive. 
  
 (d) Upon the termination of the
Executive’s employment by the Company other than for Cause or his termination of his employment for Good Reason or in the event of termination in accordance with Section 4 hereof as a result of death or disability, the Executive shall have the
right to sell to Riddell Holdings, LLC, in accordance with the terms and conditions of the Riddell Holdings, LLC Amended and Restated Limited Liability Company Agreement, as amended and in effect from time to time (the “LLC Agreement”),
the Executive’s vested Units at a price equal to the Fair Market Value of the Units; provided, that EBITDA for the Company for the most recently completed Fiscal Year preceding the date of 

  

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termination or resignation was at least Fifty-Five Million Dollars ($55,000,000) and EBITDA for the Company has been growing at a rate of at least 5% per
year following the 2005 Fiscal Year. 
  
 (e) Any
capitalized term contained in paragraphs (a) through (d) of this Section 3.3 or in Section 3.4 below, or in the definition of “Change of Control” set forth in Section 4.7 hereof, which is not defined in this Agreement shall have the
meaning ascribed to that term in the Equity Incentive Plan, the LLC Agreement or the certificate granting the Executive equity incentive units. Except as expressly provided in this Section 3.3, the Executive’s rights and obligations, and those
of Riddell Holdings, LLC and its Affiliates, with respect to its securities (including without limitation at the time the Executive’s employment is terminated under Section 4 hereof) shall be governed by the terms of the Equity Incentive Plan
and the LLC Agreement. 
  
 3.4 Equity
Purchase. On the Closing Date, the Executive invested not less than 27.5% of his after-tax proceeds in respect of his Management Incentive Plan (“MIP”) Units to the purchase of 652,307.621 Class A Units of Riddell Holdings, LLC
contemporaneous with the consummation of the merger contemplated by the Merger Agreement and at the same price paid by all other purchasers of Class A Units at that time. 
  
 3.5 Perquisites 
  
 (a) In the event that the Executive elects to lease or purchase an automobile during the Employment Period,
the Company will reimburse the Executive monthly an amount equal to the monthly lease payment the Company would have incurred under a standard three year lease of a BMW Five Series automobile (the “Car Allowance”). During the Employment
Period, the Company also shall reimburse the Executive’s normal operating costs with respect to the car he uses for business purposes. 
  
 (b) During the Employment Period, the Company will reimburse the annual dues for one country club membership for the Executive.

  
 3.6 Reimbursement of Expenses. During
the Employment Period, the Company shall reimburse the Executive for all expenses reasonably incurred by him in connection with the business of the Company and its Affiliates, upon presentation of proper receipts or other proof of expenditure and
subject to such reasonable guidelines or limitations provided to the Executive and applied prospectively, as established by the Company. 
  
 3.7 Vacation. During the Employment Period, the Executive shall be entitled to four (4) weeks of paid vacation and to sick leave,
each in accordance with Company policy and, with respect to vacation, with the timing of its use being subject to the reasonable business needs of the Company. 
  

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 3.8 Participation in Benefit Plans and Certain Reimbursements. 
  
 (a) During the Employment Period, the Executive shall be
entitled to participate in any and all employee benefit plans from time to time in effect for executives of the Company generally, except to the extent such plans are duplicative of a benefit otherwise provided to the Executive under this Agreement
(e.g., severance pay). Such participation shall be subject to the terms of the applicable plan documents and generally applicable Company policies. 
  
 (b) During the Employment Period, in addition to the benefits provided pursuant to Section 3.8(a) hereof, the Company will reimburse the
reasonable annual premium cost of term life insurance maintained by the Executive on his life to a maximum face amount of one times the Base Salary. The Executive shall be entitled to name the beneficiary of such life insurance. 
  
 (c) During the Employment Period, the Company will reimburse
deductibles, co-payments and like expenses not covered by the Company’s medical and dental plans incurred by the Executive and his eligible dependents participating in those plans (hereafter, collectively, “Uninsured Medical
Expenses”). The Company will also reimburse the Executive during the Employment Period for state and federal income taxes paid by him on reimbursements received hereunder for Uninsured Medical Expenses. 
  
 4. Termination. 
  
 4.1 Death. Upon the death of the Executive, the
Employment Period shall automatically terminate and all rights of the Executive and his heirs, executors and administrators to compensation and other benefits hereunder shall cease, except for the following: (i) The Company will pay to the
beneficiary designated by the Executive in writing or, if none, to his estate, an Annual Bonus for the Fiscal Year in which termination occurs, determined by multiplying the Annual Bonus the Executive would have received had he continued employment
through the last day of such Fiscal Year by a fraction, the numerator of which is the number of days he was employed during such Fiscal Year, through the date of termination, and the denominator of which is 365 (a “Pro-Rated Annual
Bonus”) or, if greater, an amount equal to the Annual Bonus paid to the Executive for the Fiscal Year preceding that in which termination occurs, with the applicable payment being due at the time annual bonuses are paid to Company
executives generally under its executive incentive plan for the Fiscal Year in which termination occurs. (ii) The Company will pay or reimburse the premium cost for continued participation of the Executive’s eligible dependents in the
Company’s group health and dental plans (as in effect for current executives’ dependents) under COBRA for twelve (12) months following the date of termination hereunder. (iii) The Company will provide to the Executive’s spouse for
twelve (12) months following the date of termination hereunder the perquisites set forth in Section 3.5 hereof. 
  
 4.2 Disability. 
  
 (a) The Company may, at its option, terminate the Employment Period upon written notice to the Executive if the Executive, because of
physical or mental incapacity or disability, fails in any material respect to perform the 

  

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services required of him hereunder for any one hundred eighty days (180) days in any 360 consecutive day period. During any such period of incapacity or
disability while the Executive’s employment hereunder continues, however, the Company shall continue to pay the Executive the Base Salary and shall continue his participation in Company benefit plans, reimbursement of Uninsured Medical Expenses
and reimbursement of term life insurance premiums in accordance with Section 3.8 hereof 
  
 (b) Upon termination hereunder, all obligations of the Company under this Agreement shall cease except for the following, which shall be
provided to the Executive, provided that he signs and returns an effective and timely release of claims in the form attached to this Agreement and marked Exhibit A (the “Release”): (i) The Company will pay or reimburse the premium
cost of continued participation by the Executive and his eligible dependents in the Company’s group health and dental plans (as in effect for current executives and their dependents) under COBRA for twelve (12) months following the date of
termination hereunder or, if less, until the Executive becomes eligible to participate in the health and/or dental plans of a new employer. (ii) The Company will continue to reimburse the premium cost of term life insurance described in Section
3.8(b) hereof for twelve (12) months following the date of termination hereunder or, if less, until the Executive becomes eligible for life insurance coverage through a new employer. (iii) For twelve (12) months following the date of termination
hereunder or, if less, until the Executive commences new employment, the Company will continue to reimburse Uninsured Medical Expenses; will continue the Car Allowance and reimbursement of his car operating expenses; and will continue to reimburse
dues of one country club membership for the Executive. (iv) The Company will pay the Executive a Pro-Rated Annual Bonus for the Fiscal Year in which termination occurs or, if greater, an amount equal to the Annual Bonus paid to the Executive for the
Fiscal Year preceding that in which termination occurs, with payment being due at the time the annual bonuses are paid to Company executives generally under its executive incentive plan. In the event that the Company has not offered the Executive
participation in a long-term disability plan, then, in the event of termination hereunder, the Company shall continue to pay the Executive the Base Salary until the earlier of the expiration of six (6) months from the date of termination hereunder
or the date he recovers from his incapacity or disability. Notwithstanding anything to the contrary herein, no payments or reimbursements shall be due hereunder until five (5) business days following the later of the effective date of the Release or
the date the Release, signed by the Executive, is received by the Chairman of the Board. 
  
 (c) In the event of any dispute regarding the existence of the Executive’s incapacity or disability hereunder, the matter shall be
resolved by the determination of a majority of three physicians qualified to practice medicine in the state of the Executive’s residence, one to be selected by each of the Executive and the Board and the third to be selected by such two
designated physicians. For this purpose, the Executive shall submit to appropriate medical examinations reasonably necessary to determine his capacity to perform the services required to be performed by him hereunder. 
  

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 4.3 Cause. 
  
 (a) The Company may, at its option, terminate the Executive’s employment under this Agreement for
“Cause” (as hereinafter deemed). A termination for Cause shall not take effect until and unless the Company complies with this Section 4.3(a). The Executive shall be given written notice by the Board of the intention to terminate
his employment hereunder for Cause (the “Cause Notice”). The Cause Notice shall state in reasonable detail the nature of such Cause. 
  
 (b) As used in this Agreement, the term “Cause” shall mean any one or more of the following: 
  
 (i) the Executive’s refusal or willful failure to
substantially perform his duties within three (3) days after a written demand for performance is delivered to the Executive by the Board which references the potential for a “for Cause” termination and identifies the manner in which it is
believed that the Executive has failed to perform his duties hereunder; 
  
 (ii) the Executive’s gross negligence or willful misconduct with regard to the Company or any of its Affiliates, including but not limited to Bell and Riddell, which has a material adverse impact on the Company
or its Affiliates, whether economic or to reputation or otherwise, as determined by the Board; 
  
 (iii) the Executive’s conviction of, or pleading nolo contendere to, (A) a felony or any crime involving fraud or material
dishonesty or (B) any felony or crime involving moral turpitude that might be reasonably expected to adversely effect the Company or its Affiliates; 
  
 (iv) the Executive’s refusal or willful failure to follow a lawful, written direction of the Board or its designee within the scope
of the Executive’s duties hereunder within three (3) days after written notice has been given to the Executive by the Board that failure to follow the direction will be grounds for termination for Cause; 
  
 (v) Executive’s theft, fraud or any material act of
dishonesty related to the Company or any of its Affiliates; 
  
 (vi) any representations or warranties of the Executive hereunder that there is no legal impediment to employment, no disclosure of third party confidential information and no breach of any existing employment
agreement prove false in a material respect; provided that Executive has been provided with written notification of any of the foregoing and has been given five (5) days to present any mitigating, corrective or clarifying information to the Board;

  
 (vii) the Executive’s breach of a
fiduciary duty owed to the Company or any of its Affiliates, including but not limited to any breach or violation of those provisions of this Agreement setting forth the Executive’s obligations with respect to confidentiality, non-competition
and non-solicitation, unless such breach is determined 

  

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by the Board to be reasonably susceptible to correction and is corrected by the Executive within ten (10) days of the Company’s written notification to
Executive of such breach; 
  
 (viii) the
Executive’s breach of a material provision of this Agreement unless corrected by Executive within ten (10) days of the Company’s written notification to Executive of such breach or 
  
 (ix) any restatement of the Company’s audited
financial statements shall occur or the Company’s auditors shall require an adjustment to current year financials then being audited, which would result in a greater than 10% decrease to the Company’s EBITDA for any fiscal year and would
also require a waiver or amendment of the Company’s credit agreement with its senior lenders; provided, however, that no such reinstatement or adjustment shall be Cause hereunder to the extent that it pertains or results from Riddell business
conducted prior to the Closing. 
  
 No act or failure to act by the Executive
shall be deemed “willful” if done or omitted to be done by the Executive in good faith and in the reasonable belief that such action or omission was in the best interest of the Company and its Affiliates and/or permitted or required by
applicable law. 
  
 (c) The exercise of the right
of the Company to terminate this Agreement pursuant to this Section 4.3 shall not abrogate the rights or remedies of the Company in respect of the breach giving rise to such termination. 
  
 (d) If the Company terminates the Executive’s employment for Cause, or if the Executive terminates his
employment hereunder in accordance with Section 4.4, which termination shall not constitute a breach of this Agreement, he shall only be entitled to: (i) accrued Base Salary through the date of the termination of his employment and (ii) any amounts
owing but not yet paid pursuant to Sections 3.5, 3.6, 3.8(b) and 3.8(c).  
  
 4.4 Termination by the Executive other than for Good Reason. The Executive may termination his employment hereunder other than for
Good Reason upon sixty (60) days’ notice to the Company. The Board may elect to accept the Executive’s notice prior to the expiration of such notice period, but in that event the Executive shall be entitled to the Base Salary for the
notice period or any remaining portion thereof. In addition, the Executive shall be entitled to payments in accordance with Section 4.3(d), directly above. Following any termination of Executive’s employment pursuant to this Section 4.4, the
Company shall have no further obligation to the Executive hereunder. 
  

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 4.5 Termination by the Company other than for Cause. In the event the Company
terminates this Agreement and the Executive’s employment hereunder for any reason other than as provided in Sections 4.1, 4.2, 4.3 or 4.7 hereof, such termination shall not constitute a breach of this Agreement. Upon the occurrence of such
termination, and provided that the Executive executes and returns a timely and effective Release, the Company will provide the Executive the following: 
  
 (a) For twenty-four (24) months immediately following the date of termination, the Company will provide the Executive monthly severance
pay equal to one-twelfth of the Base Salary; provided, however, that during months 13 through 24 thereof, the Company shall be entitled to reduce such severance pay by the amount of any earnings and benefits to which the Executive is entitled from
other employment during that twelve month period. The Executive agrees to provide the Company monthly during the second year of severance pay hereunder sufficient information concerning his earnings and benefits from other employment for the Company
to determine its obligations to him hereunder. 
  
 (b) The Company will pay the Executive (i) an amount equal to the Annual Bonus paid to him for the Fiscal Year preceding that in which termination occurs, payable in twelve approximately equal monthly installments with his severance pay or,
if greater, (ii) a Pro-Rated Annual Bonus, payable in a single lump sum at the time annual bonuses are paid to Company executives generally under its executive incentive plan. 
  
 (c) The Company will pay or reimburse the premium cost for participation by the Executive and his eligible
dependents in its group health and dental plans (as in effect for current Company executives) under the federal law known as COBRA) for the earliest of (i) the expiration of twenty-four (24) months immediately following the date of termination, (ii)
until the date the Executive becomes eligible for participation in the health and/or dental plan of a new employer or (iii) until the date the Executive is no longer eligible for continuation of participation under COBRA. In the event, however, that
the termination of the Executive’s eligibility under COBRA is the earliest to occur, then, until the earlier to occur of the dates set forth in clause (i) and clause (ii) above, Company either will arrange for the Executive and his eligible
dependents to continue participation in its group health and dental plans and pay the premium cost of that participation or, if the Company determines that it is unable to arrange such participation, the Company will reimburse the Executive for the
reasonable premium cost of comparable coverage obtained by the Executive for himself and his eligible dependents. The Executive agrees to provide promptly information sufficient for the Company to determine its obligations hereunder. 
  
 (d) The Company will reimburse Uninsured Medical Expenses
during the twelve (12) months immediately following the date of termination or, if less, for so long as the Executive is entitled to payments under paragraph (c) directly above. 
  
 (e) The Company will continue the Car Allowance and its reimbursement of his car operating expenses and will
continue to reimburse the annual dues of one country club membership during the twelve (12) months immediately following the date of termination 
  
 (f) During the twenty-four (24) months immediately following the date of termination, the Company will continue the Executive’s
participation in its 

  

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group life insurance plan with the same coverage in effect immediately prior to the date of termination or, if the Company determines that such participation
is not available, it will pay the premium cost of an individual term life insurance policy with a face amount equal to his coverage under the group life insurance plan immediately prior to termination, provided that the Executive is insurable at
normal rates. The Executive agrees to cooperate with the Company in obtaining such individual term life insurance, including without limitation submission to any physical examinations required by the insurer. 
  
 Notwithstanding anything to the contrary contained in this Section 4.5, however, no payments
or reimbursements shall be due hereunder until five (5) business days following the later of the effective date of the Release or the date the Release, signed by the Executive, is received by the Chairman of the Board. 
  
 4.6 Termination for Good Reason. 
  
 (a) The Executive may terminate his employment under this
Agreement for Good Reason (as hereinafter defined) within sixty (60) days following the occurrence of an event giving rise to Good Reason, upon notice to the Company setting forth in reasonable detail the nature of such Good Reason. 
  
 (b) For purposes of this Agreement, “Good
Reason” shall mean, without the Executive’s express written consent, the occurrence of any one or more of the following events: 
  
 (i) the material breach of this Agreement by the Company which is not cured, if curable, within twenty (20) days after written notice to
the Company of such breach by the Executive; 
  
 (ii) a material diminution of any of the Executive’s significant duties or the assignment to the Executive of any duties inconsistent with his then existing duties or the material impairment of the Executive’s ability to function
in the positions described in Section 2.1 hereof, in each case only after the Company shall have had an opportunity to cure (any cure to be effected within twenty (20) days after appropriate written notice of the basis for Good Reason is given to
the Company by the Executive); 
  
 (iii) any
reduction in or failure to pay the Base Salary, any failure to pay any Annual Bonus to which the Executive is entitled pursuant to Section 3.2, any material reduction of any benefit or perquisite enjoyed by the Executive, or any failure to continue
the Executive’s participation in any incentive compensation plan unless a plan providing a substantially similar economic opportunity is substituted, in each case only after the Company has been given an opportunity to cure any such event
within twenty (20) days following the Executive’s written notice to the Company; or 
  
 (iv) any change in the location of the Executive’s principal place of employment with the Company in Irving, Texas to a location
more than fifty (50) miles from such location. 
  

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 (c) In the event the Executive terminates this Agreement for Good Reason, the Executive
shall be entitled to the payments and benefits specified in Sections 4.5(a) through 4.5(f), subject to the terms and conditions of Section 4.5, including without limitation the requirement that he execute and return a timely and effective Release.

  
 4.7 Termination Following a Change of
Control 
  
 (a) In the event that during the
period commencing on the day following the occurrence of a Change of Control and ending twenty-four (24) months thereafter the Executive terminates this Agreement for Good Reason in accordance with Section 4.6 hereof or the Company terminates the
Executive’s employment hereunder other than for Cause in accordance with Section 4.5, in either case by delivering to the other a notice of such termination (which termination shall not constitute a breach of this Agreement), the Executive,
provided he executes timely and effective Release, shall be entitled to the following, which shall be in lieu of any severance pay or other benefits under Section 4.5 or Section 4.6 hereof (other than as expressly provided in clause D and clause E
below): (A) a single lump sum payment equal to twenty-four (24) months of Base Salary, without offset for other earnings; (B) the greater of (y) an amount equal to the Annual Bonus paid for the Fiscal Year preceding that in which termination occurs,
included in the lump sum payment under clause (A) immediately above or (z) a Pro-Rated Annual Bonus for the Fiscal Year in which termination occurs, payable in a single lump sum at the time annual bonuses are paid to Company executives generally;
(C) continuation for twelve (12) months immediately following the date of termination the Car Allowance, reimbursement of his car operating expenses and reimbursement of the dues of one country club membership for the Executive; (D) medical and
dental plan premium payments (or, as applicable, reimbursements) in accordance with Section 4.5(c) above and subject to the Executive’s compliance with the final sentence thereof and (E) reimbursement of Uninsured Medical Expenses in accordance
with Section 4.5(d) above. Notwithstanding anything to the contrary herein, no payments or reimbursements shall be due hereunder until five (5) business days following the later of the effective date of the Release or the date the Release, signed by
the Executive, is received by the Chairman of the Board. 
  
 (b) For purposes of this Agreement, “Change of Control” shall mean (i) any change in the ownership of the equity capital of Riddell Holdings, LLC (the “Common Units”) if, immediately after
giving effect thereto, (A) the Investors and their Affiliates will hold, directly or indirectly, less than 50% of the Common Units with voting rights held by the Investors as of the Closing or (B) any Person other than the Investors and their
Affiliates will hold, directly or indirectly, greater than 50% of the outstanding Common Units with voting rights; or (ii) any sale or other disposition of all or substantially all of the assets of Riddell Holdings, LLC (including, without
limitation, by way of a merger or consolidation or through the sale of all or substantially all of the stock or membership interests of its direct and indirect subsidiaries (the “Subsidiaries”), or sale of all or substantially all
of the assets of Riddell Holdings LLC and its direct and indirect subsidiaries, taken as a whole) to 

  

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another Person (the “Change of Control Transferee”) if, immediately after giving effect thereto, any Person (or group of Persons acting in concert)
other than the Investors and their Affiliates will have the power to elect a majority of the members of the board of managers or board of directors (or other similar governing body) of the Change of Control Transferee. 
  
 (c) For purposes of this Section 4.7: A
“Person” shall have the meaning ascribed to that term in section 13(d)(3) or 14(d)(2) of the Securities Exchange Act of 1934. “Investors” shall mean all Unit-holders of Riddell Holdings, LLC as of the date of this
Agreement, including without limitation Fenway Partners, Inc., American Capital Strategies Ltd., Antares Capital Corporation, Bell Sports Holdings, LLC, Bell Sports 2001, LLC, Bell Sports 2001 Coinvestors, LLC and Bell Sports 2001 Investments, LLC.

  
 4.8 Execution of the Release. The
Release creates legally binding obligations and the Company and its Affiliates therefore advise the Executive to consult legal counsel before signing the Release. 
  
 5. Indemnification. To the fullest extent permitted by applicable law, the Executive (and his heirs, executors and
administrators) shall be indemnified by the Company and its successors and assigns for acts or failures to act which occurred during his employment. The Executive’s right to indemnification shall include the right to be paid by the Company the
expenses incurred in defending any proceeding in advance of its final disposition, provided that the Executive shall repay any advanced amounts if it shall be ultimately determined that the Executive is not entitled to be indemnified for such
expenses under this Agreement or otherwise. The obligations of the Company pursuant to this Section 5 shall survive the termination of the Employment Period. 
  
 6. Confidential Information. 
  
 6.1 The Executive acknowledges that the Company and its Affiliates continually develop Confidential Information (as hereinafter defined),
that the Executive may develop Confidential Information for the Company or its Affiliates and that the Executive may learn of Confidential Information during the course of employment. The Executive will comply with the policies and procedures of the
Company and its Affiliates for protecting Confidential Information and shall not disclose to any Person or use, other than as required by applicable law or for the proper performance of his duties and responsibilities to the Company and its
Affiliates, any Confidential Information obtained by the Executive incident to his employment or other association with the Company or any of its Affiliates. The Executive understands that this restriction shall continue to apply after his
employment terminates, regardless of the reason for such termination. 
  
 6.2 For purposes of this Agreement, “Confidential Information” means any and all information of the Company and its Affiliates that is not generally known by those with whom the Company or any of its
Affiliates competes or does business, or with whom the Company or any of its Affiliates plans to compete or do business, including without limitation (i) information related to the Products, technical data, methods, processes, know-how and 

  

 12 

 
inventions of the Company and its Affiliates, (ii) the development, research, testing, marketing and financial activities and strategic plans of the Company
and its Affiliates, (iii) the manner in which the Company and its Affiliates operate, (iv) their costs and sources of supply, (v) the identity and special needs of the customers and prospective customers of the Company and its Affiliates and (vi)
the persons and entities with whom the Company and its Affiliates have business relationships and the nature and substance of those relationships. Confidential Information also includes any information that the Company or any of its Affiliates may
receive or has received from customers, subcontractors, suppliers or others with any understanding, express or implied, that the information would not be disclosed. Confidential Information does not include information that enters the public domain,
other than through a breach by the Executive or another Person of an obligation of confidentiality to the Company or one of its Affiliates. 
  
 6.3 All documents, records, tapes and other media of every kind and description relating to the business, present or otherwise, of the
Company or its Affiliates and any copies, in whole or in part, thereof (the “Documents”), whether or not prepared by the Executive, shall be the sole and exclusive property of the Company and its Affiliates. The Executive shall
safeguard all Documents and shall surrender to the Company at the time his employment terminates, or at such earlier time or times as the Board or its designee may specify, all Documents and all other property of the Company and its Affiliates then
in the Executive’s possession or control. 
  
 7.
Restricted Activities. 
  
 7.1 The
Executive agrees that some restrictions on his activities during and after his employment are necessary to protect the goodwill, Confidential Information and other legitimate interests of the Company and its Affiliates: 
  
 (a) While the Executive is employed by the Company and for
the greater of the period of twenty-four (24) months following termination of his employment with the Company or the period specified in the Merger Agreement (in either case, the “Non-Competition Period”), the Executive shall not,
directly or indirectly, whether as owner, partner, investor, consultant, agent, employee, co-venturer or otherwise, compete with the Company or any of the Serviced Affiliates (as hereafter defined) anywhere in the world. Specifically, but without
limiting the foregoing, the Executive agrees not to engage in any manner in any activity that is directly or indirectly competitive or potentially competitive with the business of the Company or any of its Affiliates as conducted or under
consideration at any time during the Executive’s employment and not to provide advice or any other services, with or without compensation, to any Person who directly or indirectly competes or plans to compete with the Company or any of its
Affiliates. For the purposes of this Section 7, the business of the Company and its Affiliates shall include all of Products, and the Executive’s undertaking shall encompass all items, products and services that may be used in substitution for
Products. The “Serviced Affiliates” are those Affiliates of the Company as to which the Executive has provided services or had access to the employees, customers, vendors or Confidential Information. 
  

 13 

 (b) While the Executive is employed by the Company and during the Non-Competition Period,
the Executive will not hire or attempt to hire any employee of the Company or any of the Serviced Affiliates, assist in such hiring by any Person, encourage any such employee to terminate his or her employment relationship with the Company or any of
the Serviced Affiliates, or solicit or encourage any customer of, or vendor to, the Company or any of the Serviced Affiliates to terminate or diminish its relationship with them, or, in the case of a customer, to conduct with any Person any business
or activity which such customer conducts or could conduct with the Company or any of its Affiliates. 
  
 8. Inventions. The Executive hereby assigns to the Company his entire right, title and interest in and to all discoveries and improvements,
patentable or otherwise, trade secrets and ideas, writings and copyrightable material, which may be conceived by the Executive or developed or acquired by him prior to and during the term of the Employment Period (but only while employed by the
Company or its Subsidiaries or any of their predecessors, successors or assigns, all of which entities, with the Company, are hereafter termed the “Riddell-Bell Group”), which pertain to the business of the Riddell-Bell Group, make
use of the Confidential Information or the facilities or equipment of the Riddell-Bell Group or were suggested by any of his work for the Riddell-Bell Group (the “Intellectual Property”). The Executive agrees to disclose promptly,
fully and in writing all Intellectual Property to the Company. The Executive shall, upon the Company’s request and at the Company’s sole expense, execute, acknowledge and deliver to the Company all instruments and do all other acts which
are necessary or desirable to enable the Company to file and prosecute applications for, and to acquire, maintain and enforce, all patents, trademarks and copyrights in all countries in respect of the Intellectual Property. 
  
 9. Relief, Reformation, Severability. The Executive acknowledges that
he has carefully read and considered all terms and conditions of this Agreement, including the restraints imposed by Sections 6, 7 and 8 hereof. The Executive acknowledges that there is no adequate remedy at law for a breach of Sections 6, 7 and 8
and that, in the event of such a breach or attempted breach, the Company shall be entitled to injunctive or other equitable relief to prevent any such breach, attempted breach or continuing breach, without prejudice to any other remedies for damages
or otherwise. The Executive agrees that the covenants contained in this Agreement are separate and are reasonable in their nature, subject matter, geographic limitation, scope and duration and that the Executive shall not raise any issue of
reasonableness as a defense in any proceeding to enforce any of such covenants. Notwithstanding the foregoing, in the event that a covenant contained in this Agreement shall be deemed by any court to be unreasonably broad in any respect, the parties
agree that the court may modify such covenant for the purpose of making such covenant reasonable in geographic limitation, scope and duration. The validity, legality or enforceability of the remaining provisions of this Agreement shall not be
affected by any such modification. 
  
 10. Conflicting
Agreements. The Executive hereby represents and warrants that the execution of this Agreement and the performance of his obligations hereunder will not breach or be in conflict with any other agreement to which the Executive is a party or is
bound and that the Executive is not now subject to any covenants against competition or similar covenants or any court order or other legal obligation that would affect the performance of his obligations 

  

 14 

 
hereunder. The Executive will not disclose to or use on behalf of the Company any proprietary information of a third party without such party’s consent.

  
 11. Insurance. The Company may, at its election and for
its benefit, insure the Executive against disability, accidental loss or death and the Executive shall submit to such physical examinations and supply such information as may be reasonably required in connection therewith. 
  
 12. Expenses. The Company will reimburse the Executive for his
reasonable out of pocket costs and expenses of obtaining independent legal advice relating to the negotiation of the agreement between the Company and the Executive which he executed on September 24, 2004 (the “Binding Term Sheet”), this
Agreement and the Executive’s related equity participation in the Company; provided, that, the maximum payment under this Section 12 shall not exceed $7,500. 
  
 13. Definitions. Words or phrases which are initially capitalized or are within quotation marks shall have the
meanings provided in this Section and as provided elsewhere herein. For purposes of this Agreement, the following definitions apply. 
  
 13.1 “Affiliates” means all persons and entities directly or indirectly controlling, controlled by or under common
control with a specified person or entity, where control may be by management authority, contract or equity interest. 
  
 13.2 “Person” means an individual, a corporation, a limited liability company, an association, a partnership, an estate,
a trust and any other entity or organization, other than the Company or any of its Affiliates. 
  
 13.3 “Products” means all products planned, researched, developed, tested, manufactured, sold, licensed, leased or
otherwise distributed or put into use by the Company or any of its Affiliates, together with all services provided or planned by the Company or any of its Affiliates, during the Executive’s employment. 
  
 14. Assignment. The rights and benefits of the Executive hereunder
shall not be assignable, whether by voluntary or involuntary assignment or transfer. This Agreement shall be binding upon, and inure to the benefit of, the successors and assigns of the Company, and the heirs, executors and administrators of the
Executive, and shall be assignable by the Company to any entity acquiring substantially all of the assets of the Company, whether by merger, consolidation, sale of assets or similar transactions. 
  
 15. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and effective when personally delivered or deposited in the United States mail, certified or registered, or consigned to an overnight courier service and addressed as follows: if to the Executive, to his
address as set forth in the records of the Company and, if to the Company, to it c/o Mark R. Genender, Fenway Partners, Inc., 11111 Santa Monica Boulevard, Suite 1470, Los Angeles, CA 90025, with a copy to Aron Schwartz, Fenway Partners, Inc., 152
W. 57th St., 59th Floor, New York, NY 10019, or to any other address designated by any party hereto by notice to the other actually received. 
  

 15 

 16. Waiver of Breach. A waiver by the Company or the Executive of any breach of any provision of
this Agreement by the other party shall not operate or be construed as a waiver of any other or subsequent breach by the other party. No waiver of any provision hereof shall be effective unless made in writing and signed by the waiving party.

  
 17. Entire Agreement. This Agreement contains the
entire agreement of the parties, and supersedes all prior agreements, with respect to the Executive’s employment and all related matters, including without limitation the Bell Agreement, as hereinafter defined, and the Binding Term Sheet (other
than as expressly provided hereafter), but excluding the following, which shall remain in full force and effect in accordance with their terms: (a) any and all agreements between the Executive and Riddell Holdings, LLC regarding his equity
participation therein (other than to the extent inconsistent with the provisions of Section 3.3 hereof) and (b) the following provision of the Binding Term Sheet: “By signing this Agreement, Executive expressly and irrevocably waives any and
all rights he might now have, or hereafter acquire under the Bell Agreement or this Agreement as a result of the signing of the Merger Agreement or the consummation of the merger contemplated by the Merger Agreement or any event related thereto
being a “Change of Control” as that term is defined in the Bell Agreement or in this Agreement. Without limiting the generality of the foregoing, it is agreed specifically that Executive will be entitled to no termination pay or other
benefits of any kind as a result of such a “Change of Control,” whether under Section 4.7 of the Bell Agreement or otherwise.” For purposes of the foregoing provision, “Bell Agreement” means the agreement between the
Executive and Bell Sports, Inc. dated as of April 30, 2001, as amended as of July 11, 2002 and again in 2003. 
  
 18. Amendments. This Agreement may be modified only by an agreement in writing signed by the parties hereto and expressly approved by the Board.

  
 19. Validity. The invalidity or unenforceability of any
provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect. 
  
 20. Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an
original but all of which together will constitute one and the same instrument. 
  
 21. Withholding. All payments hereunder shall be subject to any required withholding of federal, state and local taxes pursuant to any applicable law or regulation. 
  
 22. Section Headings. The section headings in this Agreement are for
convenience of reference only, and they form no part of this Agreement and shall not affect its interpretation. 
  
 23. Applicable Law. The terms of this Agreement shall be governed by and construed in accordance with the internal laws (as opposed to the conflict
of laws provisions) of the State of Texas. 
  
 24.
Survival. The respective rights and obligations of the parties under this Agreement shall survive the Executive’s termination of employment and the termination of this Agreement to the extent necessary for the preservation of such rights
and obligations, including, 

  

 16 

 
without limitations, the rights and obligations under Sections 3.3, 4, 5, 6, 7, 8, 9, 10, 15 and 24 of this Agreement. 
  
 [Signature page immediately follows] 
  

 17 

 IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the Effective Date. 

 

			
	 RIDDELL BELL HOLDINGS, INC.

		
	By:	 	 /s/ Mark R. Genender

	
	 Name: Mark R. Genender

	
	 Title: Vice President

  

	
	EXECUTIVE:
	
	 /s/ William N. Fry

	 William N. Fry

  
 Riddell Holdings, LLC shall be a
party to this Agreement, but solely for the purposes of Section 3.3 hereof. 
  

			
	 RIDDELL HOLDINGS, LLC

		
	By:	 	 /s/ Mark R. Genender

	
	 Name: Mark R. Genender

	
	 Title: Vice President

  

 18 

  
 Schedule 2.1

  
 Pursuant to Section 2.1 of the Agreement, the following is a list of the
Executive’s activities as of the date this Schedule was prepared: 
  
 Bikes
Belong Coalition 
 University of Mississippi Business School Board of Advisors 
 Glenveigh Pharmaceuticals 
  
 Dated as of March
31, 2005 
  

 19 

  
 EXHIBIT A 

 
 RELEASE OF CLAIMS 
  
 FOR AND IN CONSIDERATION OF the benefits to be provided me in connection with
the termination of my employment, as set forth in the employment agreement between me and Riddell Bell Holdings, Inc. (the “Company”) effective as of September 30, 2004 (the “Agreement”), which are conditioned on my signing this
Release of Claims and to which I am not otherwise entitled, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, I, on my own behalf and on behalf of my heirs, executors, administrators,
beneficiaries, representatives and assigns, and all others connected with me, hereby release and forever discharge the Company and its Affiliates (as defined in the Agreement) and all of their respective past, present and future officers, directors,
trustees, shareholders, employees, agents, general and limited partners, members, managers, joint venturers, representatives, successors and assigns, and all others connected with any of them, both individually and in their official capacities, from
any and all causes of action, rights and claims of any type or description, known or unknown, which I have had in the past, now have, or might now have, through the date of my signing of this Release of Claims, including without limitation any
causes of action, rights or claims in any way resulting from, arising out of or connected with my employment by the Company or any of its Affiliates or the termination of that employment or pursuant to any federal, state or local law, regulation or
other requirement (including without limitation Title VII of the Civil Rights Act of 1964, the Age Discrimination in Employment Act, the Americans with Disabilities Act and the fair employment practices laws of the state or states in which I have
been employed by the Company or any of its Affiliates, each as amended from time to time). 
  
 Excluded from the scope of this Release of Claims is (i) any claim arising under the terms of the Agreement after the effective date of this Release of Claim and (ii) any right of indemnification or contribution that
I have pursuant to the Articles of Incorporation or By-Laws of the Company or any of its Subsidiaries (as defined in the Agreement). 
  
 In signing this Release of Claims, I acknowledge my understanding that I may not sign it prior to the termination of my employment, but that I may consider the terms of
this Release of Claims for up to twenty-one (21) days (or such longer period as the Company may specify) from the later of the date my employment with the Company terminates. I also acknowledge that I am advised by the Company and its Affiliates to
seek the advice of an attorney prior to signing this Release of Claims; that I have had sufficient time to consider this Release of Claims and to consult with an attorney, if I wished to do so, or to consult with any other person of my choosing
before signing; and that I am signing this Release of Claims voluntarily and with a full understanding of its terms. 
  
 I further acknowledge that, in signing this Release of Claims, I have not relied on any promises or representations, express or implied, that are not set forth expressly
in the Agreement. I understand that I may revoke this Release of Claims at any time within seven (7) days of the date of my signing by written notice to the Company c/o Mark R. Genender, Fenway Partners, Inc., 

  

 20 

 
11111 Santa Monica Boulevard, Suite 1470, Los Angeles, CA 90025, with a copy to Aron Schwartz, Fenway Partners, Inc., 152 W. 57th St., 59th Floor, New York,
NY 10019, and that this Release of Claims will take effect only upon the expiration of such seven-day revocation period and only if I have not timely revoked it. 
  
 Intending to be legally bound, I have signed this Release of Claims under seal as of the date written below. 
  

			
	 	 	 
		
	 Signature: 
	 	  
	 William N. Fry

  

			
	 	 	 
		
	 Date Signed: 
	 	  

  

 21Deposit Agreement

 Exhibit 4.1 
  

PS BUSINESS PARKS, INC. 
  
 AMERICAN STOCK TRANSFER & TRUST 
 COMPANY, AS DEPOSITARY 
  
 AND 

 
 THE HOLDERS FROM TIME TO TIME OF 
 THE DEPOSITARY RECEIPTS DESCRIBED HEREIN 
 RELATING TO SERIES M PREFERRED STOCK 
  
 DEPOSIT
AGREEMENT 
  
 Dated as of April 27, 2005 

 Table of Contents 
  

					
	 	  	 	  	Page

	 ARTICLE I
  

	 Definitions
  

	 ARTICLE II
  

	 Form of Receipts, Deposit of Stock,
 Execution and Delivery, Transfer,
 Surrender and Redemption of Receipts
  

	 SECTION 2.1
	  	Form and Transfer of Receipts	  	2
	 SECTION 2.2
	  	Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof	  	3
	 SECTION 2.3
	  	Registration of Transfer of Receipts	  	4
	 SECTION 2.4
	  	Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock	  	4
	 SECTION 2.5
	  	Limitations on Execution and Delivery, Transfer, Surrender and Exchange of Receipts	  	5
	 SECTION 2.6
	  	Lost Receipts, etc	  	5
	 SECTION 2.7
	  	Cancellation and Destruction of Surrendered Receipts	  	5
	 SECTION 2.8
	  	Redemption of Stock	  	6
	
	ARTICLE III
	
	Certain Obligations of Holders of Receipts and the Company
			
	 SECTION 3.1
	  	Filing Proofs, Certificates and Other Information	  	7
	 SECTION 3.2
	  	Payment of Taxes or Other Governmental Charges	  	7
	 SECTION 3.3
	  	Warranty as to Stock	  	8
	
	ARTICLE IV
	
	The Deposited Securities; Notices
			
	 SECTION 4.1
	  	Cash Distributions	  	8
	 SECTION 4.2
	  	Distributions Other than Cash, Rights, Preferences or Privileges	  	8
	 SECTION 4.3
	  	Subscription Rights, Preferences or Privileges	  	9
	 SECTION 4.4
	  	Notice of Dividends, etc.; Fixing Record Date for Holders of Receipts	  	10
	 SECTION 4.5
	  	Voting Rights	  	10
	 SECTION 4.6
	  	Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, etc	  	10
	 SECTION 4.7
	  	Delivery of Reports	  	11
	 SECTION 4.8
	  	List of Receipt Holders	  	11

  

 i 

 Table of Contents 
 (continued) 

					
	 	  	 	  	Page

	 ARTICLE V
  
 Depositary, the Depositary’s Agents, the Registrar and the Company
  

	 SECTION 5.1
	  	Maintenance of Offices, Agencies and Transfer Books by the Depositary; Registrar	  	11
	 SECTION 5.2
	  	Prevention of or Delay in Performance by the Depositary, the Depositary’s Agents, the Registrar or the Company	  	12
	 SECTION 5.3
	  	Obligation of the Depositary, the Depositary’s Agents, the Registrar and the Company	  	12
	 SECTION 5.4
	  	Resignation and Removal of the Depositary; Appointment of Successor Depositary	  	14
	 SECTION 5.5
	  	Corporate Notices and Reports	  	14
	 SECTION 5.6
	  	Indemnification by the Company	  	15
	 SECTION 5.7
	  	Charges and Expenses	  	15
	 SECTION 5.8
	  	Tax Compliance	  	15
	  
 ARTICLE VI
  

	 Amendment and Termination
  

	 SECTION 6.1
	  	Amendment	  	16
	 SECTION 6.2
	  	Termination	  	16
	  
 ARTICLE VII
  

	 Miscellaneous
  

	 SECTION 7.1
	  	Counterparts	  	16
	 SECTION 7.2
	  	Exclusive Benefit of Parties	  	17
	 SECTION 7.3
	  	Invalidity of Provisions	  	17
	 SECTION 7.4
	  	Notices	  	17
	 SECTION 7.5
	  	Appointment of Registrar	  	18
	 SECTION 7.6
	  	Holders of Receipts Are Parties	  	18
	 SECTION 7.7
	  	Governing Law	  	18
	 SECTION 7.8
	  	Inspection of Deposit Agreement	  	18
	 SECTION 7.9
	  	Headings	  	18

  
  

 ii 

 DEPOSIT AGREEMENT, dated as of April 27, 2005, among PS BUSINESS PARKS, INC., a California corporation
(the “Company”), American Stock Transfer & Trust Company (the “Depositary”), and the holders from time to time of the Receipts described herein. 
  
 WHEREAS, it is desired to provide, as hereinafter set forth in this Deposit Agreement, for the deposit of shares of Series M
Preferred Stock of the Company with the Depositary for the purposes set forth in this Deposit Agreement and for the issuance hereunder of Receipts evidencing Depositary Shares in respect of the Stock so deposited; and 
  
 WHEREAS, the Receipts are to be substantially in the form of Exhibit A
annexed hereto, with appropriate insertions, modifications and omissions, as hereinafter provided in this Deposit Agreement; 
  
 NOW, THEREFORE, in consideration of the promises contained herein, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby
agree as follows: 
  
 ARTICLE I 
  
 Definitions 
  
 The following definitions shall, for all purposes, unless otherwise
indicated, apply to the respective terms used in this Deposit Agreement: 
  
 “Certificate” shall mean the Certificate of Determination filed with the Secretary of State of the State of California establishing the Stock as a series of preferred stock of the Company. 
  
 “Deposit Agreement” shall mean this Deposit Agreement, as amended
or supplemented from time to time. 
  
 “Depositary”
shall mean American Stock Transfer & Trust Company and any successor as Depositary hereunder. 
  
 “Depositary Shares” shall mean Depositary Shares, each representing 1/1,000 of a share of Stock and evidenced by a Receipt. 
  
 “Depositary’s Agent” shall mean an agent appointed by the
Depositary pursuant to Section 5.1 and shall include the Registrar if such Registrar is not the Depositary. 
  
 “Depositary’s Office” shall mean the principal office of the Depositary at which at any particular time its depositary receipt business
shall be administered. 
  
 “Receipt” shall mean one of
the Depositary Receipts, substantially in the form set forth as Exhibit A hereto, issued hereunder, whether in definitive or temporary form and 
  

 - 1 - 

 evidencing the number of Depositary Shares held of record by the record holder of such Depositary Shares. 
  
 “record holder” or “holder” as applied to a Receipt shall
mean the person in whose name a Receipt is registered on the books of the Depositary maintained for such purpose. 
  
 “Registrar” shall mean the Depositary or such other bank or trust company which shall be appointed to register ownership and transfers of
Receipts as herein provided. 
  
 “Securities Act” shall
mean the Securities Act of 1933, as amended. 
  
 “Stock”
shall mean shares of the Company’s 7.20% Cumulative Preferred Stock, Series M, stated value $25,000 per share. 
  
 ARTICLE II 
  
 Form of Receipts, Deposit of Stock, 
 Execution and Delivery, Transfer, 
 Surrender and Redemption of Receipts 
  
 SECTION 2.1 Form and Transfer of Receipts. Definitive Receipts shall be engraved or printed or lithographed on steel-engraved borders, with
appropriate insertions, modifications and omissions, as hereinafter provided, if and to the extent required by any securities exchange on which the Receipts are listed. Pending the preparation of definitive Receipts or if definitive Receipts are not
required by any securities exchange on which the Receipts are listed, the Depositary, upon the written order of the Company or any holder of Stock, as the case may be, delivered in compliance with Section 2.2, shall execute and deliver temporary
Receipts which are printed, lithographed, typewritten, mimeographed or otherwise substantially of the tenor of the definitive Receipts in lieu of which they are issued and with such appropriate insertions, omissions, substitutions and other
variations as the persons executing such Receipts may determine, as evidenced by their execution of such Receipts. If temporary Receipts are issued, the Company and the Depositary will cause definitive Receipts to be prepared without unreasonable
delay. After the preparation of definitive Receipts, the temporary Receipts shall be exchangeable for definitive Receipts upon surrender of the temporary Receipts at the Depositary’s Office or at such other place or places as the Depositary
shall determine, without charge to the holder. Upon surrender for cancellation of any one or more temporary Receipts, the Depositary shall execute and deliver in exchange therefor definitive Receipts representing the same number of Depositary Shares
as represented by the surrendered temporary Receipt or Receipts. Such exchange shall be made at the Company’s expense and without any charge to the holder therefor. Until so exchanged, the temporary Receipts shall in all respects be entitled to
the same benefits under this Agreement, and with respect to the Stock, as definitive Receipts. 
  
 Receipts shall be executed by the Depositary by the manual and/or facsimile signature of a duly authorized officer of the Depositary. No Receipt shall be entitled to any benefits under this Deposit Agreement or be
valid or obligatory for any purpose unless it shall have been executed in accordance with the foregoing sentence. The Depositary shall record on its books each Receipt so signed and delivered as hereinafter provided. 
  

 - 2 - 

 Receipts shall be in denominations of any number of whole Depositary Shares. The Company shall deliver to
the Depositary from time to time such quantities of Receipts as the Depositary may request to enable the Depositary to perform its obligations under this Deposit Agreement. 
  
 Receipts may be endorsed with or have incorporated in the text thereof such legends or recitals or changes not inconsistent
with the provisions of this Deposit Agreement as may be required by the Depositary or required to comply with any applicable law or any regulation thereunder or with the rules and regulations of any securities exchange upon which the Stock, the
Depositary Shares or the Receipts may be listed or to conform with any usage with respect thereto, or to indicate any special limitations or restrictions to which any particular Receipts are subject. 
  
 Title to Depositary Shares evidenced by a Receipt, which is properly endorsed
or accompanied by a properly executed instrument of transfer, shall be transferable by delivery with the same effect as in the case of a negotiable instrument; provided, however, that until transfer of a Receipt shall be registered on
the books of the Depositary as provided in Section 2.3, the Depositary may, notwithstanding any notice to the contrary, treat the record holder thereof at such time as the absolute owner thereof for the purpose of determining the person entitled to
distributions of dividends or other distributions or to any notice provided for in this Deposit Agreement and for all other purposes. 
  
 SECTION 2.2 Deposit of Stock; Execution and Delivery of Receipts in Respect Thereof. Subject to the terms and conditions of this Deposit Agreement,
the Company may from time to time deposit shares of Stock under this Deposit Agreement by delivery to the Depositary of a certificate or certificates for the Stock to be deposited, properly endorsed or accompanied, if required by the Depositary, by
a duly executed instrument of transfer or endorsement, in form satisfactory to the Depositary, together with all such certifications as may be required by the Depositary in accordance with the provisions of this Deposit Agreement, and together with
a written order of the Company directing the Depositary to execute and deliver to, or upon the written order of, the person or persons stated in such order a Receipt or Receipts for the number of Depositary Shares representing such deposited Stock.

  
 Deposited Stock shall be held by the Depositary at the
Depositary’s Office or at such other place or places as the Depositary shall determine. 
  
 Upon receipt by the Depositary of a certificate or certificates for Stock deposited in accordance with the provisions of this Section, together with the other documents required as above specified, and upon
recordation of the Stock on the books of the Company in the name of the Depositary or its nominee, the Depositary, subject to the terms and conditions of this Deposit Agreement, shall execute and deliver, to or upon the order of the person or
persons named in the written order delivered to the Depositary referred to in the first paragraph of this Section, a Receipt or Receipts for the whole number of Depositary Shares representing, in the aggregate, 
  

 - 3 - 

 the Stock so deposited and registered in such name or names as may be requested by such person or persons. The Depositary
shall execute and deliver such Receipt or Receipts at the Depositary’s Office or such other offices, if any, as the Depositary may designate. Delivery at other offices shall be at the risk and expense of the person requesting such delivery.

  
 SECTION 2.3 Registration of Transfer of Receipts.
Subject to the terms and conditions of this Deposit Agreement, the Depositary shall register on its books from time to time transfers of Receipts upon any surrender thereof by the holder in person or by a duly authorized attorney, properly endorsed
or accompanied by a properly executed instrument of transfer. Thereupon, the Depositary shall execute a new Receipt or Receipts evidencing the same aggregate number of Depositary Shares as those evidenced by the Receipt or Receipts surrendered and
deliver such new Receipt or Receipts to or upon the order of the person entitled thereto. 
  
 SECTION 2.4 Split-ups and Combinations of Receipts; Surrender of Receipts and Withdrawal of Stock. Upon surrender of a Receipt or Receipts at the Depositary’s Office or at such other offices as it may
designate for the purpose of effecting a split-up or combination of such Receipt or Receipts, and subject to the terms and conditions of this Deposit Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in the authorized
denomination or denominations requested, evidencing the aggregate number of Depositary Shares evidenced by the Receipt or Receipts surrendered; provided, however, that the Depositary shall not issue any Receipt evidencing a fractional
Depositary Share. 
  
 Any holder of a Receipt or Receipts
representing any number of whole shares of Stock may (unless the related Depositary Shares have previously been called for redemption) withdraw the Stock and all money and other property, if any, represented thereby by surrendering such Receipt or
Receipts at the Depositary’s Office or at such other offices as the Depositary may designate for such withdrawals and paying any unpaid amount due the Depositary. Thereafter, without unreasonable delay, the Depositary shall deliver to such
holder or to the person or persons designated by such holder as hereinafter provided, the number of whole shares of Stock and all money and other property, if any, represented by the Receipt or Receipts so surrendered for withdrawal, but holders of
such whole shares of Stock will not thereafter be entitled to deposit such Stock hereunder or to receive Depositary Shares therefor. If a Receipt delivered by the holder to the Depositary in connection with such withdrawal shall evidence a number of
Depositary Shares in excess of the number of Depositary Shares representing the number of whole shares of Stock to be so withdrawn, the Depositary shall at the same time, in addition to such number of whole shares of Stock and such money and other
property, if any, to be so withdrawn, deliver to such holder, or upon his order, a new Receipt evidencing such excess number of Depositary Shares; provided, however, that the Depositary shall not issue any Receipt evidencing a
fractional Depositary Share. Delivery of the Stock and money and other property being withdrawn may be made by the delivery of such certificates, documents of title and other instruments as the Depositary may deem appropriate which, if required by
the Depositary, shall be properly endorsed or accompanied by proper instruments of transfer. 
  

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 If the Stock and the money and other property being withdrawn are to be delivered to a person or persons
other than the record holder of the Receipt or Receipts being surrendered for withdrawal of Stock, such holders shall execute and deliver to the Depositary a written order so directing the Depositary and the Depositary may require that the Receipt
or Receipts surrendered by such holder for withdrawal of such shares of Stock be properly endorsed in blank or accompanied by a properly executed instrument of transfer in blank. 
  
 Delivery of the Stock and the money and other property, if any, represented by Receipts surrendered for withdrawal shall be
made by the Depositary at the Depositary’s Office, except that, at the request, risk and expense of the holder surrendering such Receipt or Receipts and for the account of the holder thereof, such delivery may be made at such other place as may
be designated by such holder. 
  
 SECTION 2.5 Limitations on
Execution and Delivery, Transfer, Surrender and Exchange of Receipts. As a condition precedent to the execution and delivery, registration of transfer, split-up, combination, surrender or exchange of any Receipt, the Depositary, any of the
Depositary’s Agents or the Company may require payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such payment, the reimbursement to it) of any charges or expenses payable by
the holder of a Receipt pursuant to Sections 3.2 and 5.7, may require the production of evidence satisfactory to it as to the identity and genuineness of any signature, and may also require compliance with such regulations, if any, as the Depositary
or the Company may establish consistent with the provisions of this Deposit Agreement. 
  
 The deposit of Stock may be refused, the delivery of Receipts against Stock may be suspended, the registration of transfer of Receipts may be refused and the registration of transfer, surrender or exchange of
outstanding Receipts may be suspended (i) during any period when the register of stockholders of the Company is closed, or (ii) if any such action is deemed necessary or advisable by the Depositary, any of the Depositary’s Agents or the Company
at any time or from time to time because of any requirement of law or of any government or governmental body or commission, stock exchange or the NASD or under any provision of this Deposit Agreement. 
  
 SECTION 2.6 Lost Receipts, etc. In case any receipt shall be
mutilated, destroyed, lost or stolen, the Depositary in its reasonable discretion may execute and deliver a Receipt of like form and tenor in exchange and substitution for such mutilated Receipt, or in lieu of and in substitution for such destroyed,
lost or stolen Receipt, upon (i) the filing by the holder thereof with the Depositary of evidence reasonably satisfactory to the Depositary of such destruction or loss or theft of such Receipt, of the authenticity thereof and of his or her ownership
thereof, (ii) the furnishing of the Depositary with indemnification reasonably satisfactory to it and the Company and (iii) the payment of any reasonable expense (including reasonable fees, charges and expenses of the Depositary) in connection with
such execution and delivery. 
  
 SECTION 2.7 Cancellation and
Destruction of Surrendered Receipts. All Receipts surrendered to the Depositary or any Depositary’s Agent shall be cancelled by the Depositary. Except as prohibited by applicable law or regulation, the Company is authorized to destroy all
Receipts so cancelled. 
  
  

 - 5 - 

 SECTION 2.8 Redemption of Stock. Whenever the Company shall be permitted and shall elect to redeem
shares of Stock in accordance with the provisions of the Certificate, it shall (unless otherwise agreed to in writing with the Depositary) give or cause to be given to the Depositary not less than 60 days’ notice of the date of such proposed
redemption or exchange of Stock and of the number of such shares held by the Depositary to be so redeemed and the applicable redemption price, as set forth in the Certificate, which notice shall be accompanied by a certificate from the Company
stating that such redemption of Stock is in accordance with the provisions of the Certificate. Notice of redemption of Stock will also be given by the Company by publication in a newspaper of general circulation in the County of Los Angeles and the
City of New York, such publication to be made once a week for two successive weeks commencing not less than 30 nor more than 60 days prior to the redemption date, and the Depositary will publish a notice of redemption of the Depositary Shares
containing the same type of information and in the same manner as the Company’s notice of redemption. On the date of such redemption, provided that the Company shall then have paid or caused to be paid in full to the Depositary the redemption
price of the Stock to be redeemed, plus an amount equal to any accrued and unpaid dividends thereon to the date fixed for redemption, in accordance with the provisions of the Certificate, the Depositary shall redeem the number of Depositary Shares
representing such Stock. The Depositary shall mail notice of the Company’s redemption of Stock and the proposed simultaneous redemption of the number of Depositary Shares representing the Stock to be redeemed by first-class mail, postage
prepaid, promptly upon receipt of the Company’s notice to redeem shares of Stock and not less than 30 and not more than 60 days prior to the date fixed for redemption of such Stock and Depositary Shares (the “Redemption Date”) to the
record holders of the Receipts evidencing the Depositary Shares to be so redeemed, at the address of such holders as they appear on the records of the Depositary; but neither failure to mail any such notice of redemption of Depositary Shares to one
or more such holders nor any defect in any notice of redemption of Depositary Shares to one or more such holders shall affect the sufficiency of the proceedings for redemption as to the other holders. The Company will provide the Depositary with the
information necessary for the Depositary to prepare such notice and each such notice shall state: (i) the Redemption Date; (ii) the number of Depositary Shares to be redeemed and, if less than all the Depositary Shares held by any such holder are to
be redeemed, the number of such Depositary Shares held by such holder to be so redeemed; (iii) the redemption price per Depositary Share; (iv) the place or places where Receipts evidencing Depositary Shares are to be surrendered for payment of the
redemption price; and (v) that dividends in respect of the Stock represented by the Depositary Shares to be redeemed will cease to accrue on such Redemption Date. In case less than all the outstanding Depositary Shares are to be redeemed, the
Depositary Shares to be so redeemed shall be determined pro rata or by lot in a manner determined by the Board of Directors of the Company. 
  
 Notice having been mailed by the Depositary as aforesaid, from and after the Redemption Date (unless the Company shall have failed to provide the funds
necessary to redeem the Stock evidenced by the Depositary Shares called for redemption) (i) dividends on the shares of Stock so called for redemption shall cease to accrue from and after such date, (ii) the Depositary Shares being redeemed from such
proceeds shall be deemed no longer to be 
  

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 outstanding, (iii) all rights of the holders of Receipts evidencing such Depositary Shares (except the right to receive
the redemption price) shall, to the extent of such Depositary Shares, cease and terminate, and (iv) upon surrender in accordance with such redemption notice of the Receipts evidencing any such Depositary Shares called for redemption (properly
endorsed or assigned for transfer, if the Depositary or applicable law shall so require), such Depositary Shares shall be redeemed by the Depositary at a redemption price per Depositary Share equal to the same fraction of the redemption price per
share paid with respect to the shares of Stock as the fraction each Depositary Share represents of a share of Stock plus the same fraction of all money and other property, if any, represented by such Depositary Shares, including all amounts paid by
the Company in respect of dividends which on the Redemption Date have accumulated on the shares of Stock to be so redeemed and have not theretofore been paid. Any funds deposited by the Company with the Depositary for any Depositary Shares that the
holders thereof fail to redeem will be returned to the Company after a period of five years from the date such funds are so deposited. 
  
 If fewer than all of the Depositary Shares evidenced by a Receipt are called for redemption, the Depositary will deliver to the holder of such Receipt
upon its surrender to the Depositary, together with the redemption payment, a new Receipt evidencing the Depositary Shares evidenced by such prior Receipt and not called for redemption; provided, however, that the Depositary shall not
issue any Receipt evidencing a fractional Depositary Share. 
  
 ARTICLE III 
  
 Certain Obligations of 

Holders of Receipts and the Company 
  
 SECTION 3.1 Filing Proofs, Certificates and Other Information. Any holder of a Receipt may be required from time to time to file such proof of
residence, or other matters or other information, to execute such certificates and to make such representations and warranties as the Depositary or the Company may reasonably deem necessary or proper or otherwise reasonably request. The Depositary
or the Company may withhold the delivery, or delay the registration of transfer, redemption or exchange, of any Receipt or the withdrawal or conversion of the Stock represented by the Depositary Shares evidenced by any Receipt or the distribution of
any dividend or other distribution or the sale of any rights or of the proceeds thereof until such proof or other information is filed or such certificates are executed or such representations and warranties are made. 
  
 SECTION 3.2 Payment of Taxes or Other Governmental Charges. Holders of
Receipts shall be obligated to make payments to the Depositary of certain charges and expenses, as provided in Section 5.7. Registration of transfer of any Receipt or any withdrawal of Stock and all money or other property, if any, represented by
the Depositary Shares evidenced by such Receipt may be refused until any such payment due is made, and any dividends, interest payments or other distributions may be withheld or any part or all of the Stock or other property represented by the
Depositary Shares evidenced by such Receipt and not theretofore sold may be sold for the account of the holder thereof (after attempting by reasonable means to notify such holder prior to such sale), and such dividends, interest payments or other
distributions or the proceeds of any such sale may be applied to any payment of such charges or expenses, the holder of such Receipt remaining liable for any deficiency. 
  

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 SECTION 3.3 Warranty as to Stock. The Company hereby represents and warrants that the Stock, when
issued, will be duly authorized, validly issued, fully paid and nonassessable. Such representation and warranty shall survive the deposit of the Stock and the issuance of Receipts. 
  
 ARTICLE IV 
  
 The Deposited Securities; Notices 
  
 SECTION 4.1 Cash Distributions. Whenever the Depositary shall receive any cash dividend or other cash distribution on Stock, the Depositary shall,
subject to Sections 3.1 and 3.2, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.4 such amounts of such dividend or distribution as are, as nearly as practicable, in proportion to the respective numbers of
Depositary Shares evidenced by the Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required to withhold and shall withhold from any cash dividend or other cash distribution in
respect of the Stock an amount on account of taxes or as otherwise required by law, regulation or court process, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly. In the event
that the calculation of any such cash dividend or other cash distribution to be paid to any record holder on the aggregate number of Receipts held by such holder results in an amount which is a fraction of a cent, the amount the Depositary shall
distribute to such record holder shall be rounded to the next highest whole cent if such fraction of a cent is equal to or greater than $.005, otherwise such fractional interest shall be disregarded; and upon request of the Depositary, the Company
shall pay the additional amount to the Depositary for distribution. 
  
 SECTION 4.2 Distributions Other than Cash, Rights, Preferences or Privileges. Whenever the Depositary shall receive any distribution other than cash, rights, preferences or privileges upon Stock, the Depositary shall, subject to
Sections 3.1 and 3.2, distribute to record holders of Receipts on the record date fixed pursuant to Section 4.4 such amounts of the securities or property received by it as are, as nearly as practicable, in proportion to the respective numbers of
Depositary Shares evidenced by the Receipts held by such holders, in any manner that the Depositary may deem equitable and practicable for accomplishing such distribution. If in the opinion of the Depositary, after consultation with the Company,
such distribution cannot be made proportionately among such record holders, or if for any other reason (including any requirement that the Company or the Depositary withhold an amount on account of taxes) the Depositary, after consultation with the
Company, deems such distribution not to be feasible, the Depositary may, with the approval of the Company, adopt such method as it deems equitable and practicable for the purpose of effecting such distribution, including the sale (at public or
private sale) of the securities or property thus received, or any part thereof, at such place or places and upon such terms as it may deem equitable and appropriate. The net proceeds of any such sale shall, subject to Sections 3.1 and 3.2, be
distributed or made available for distribution, as the case may be, by the Depositary to record holders of Receipts as provided by Section 4.1 in the case of a distribution received in cash. 
  

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 SECTION 4.3 Subscription Rights, Preferences or Privileges. If the Company shall at any time offer
or cause to be offered to the persons in whose names Stock is recorded on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature,
such rights, preferences or privileges shall in each such instance be made available by the Depositary to the record holders of Receipts in such manner as the Depositary may determine, either by the issue to such record holders of warrants
representing such rights, preferences or privileges or by such other method as may be approved by the Depositary in its discretion with the approval of the Company; provided, however, that (i) if at the time of issue or offer of any
such rights, preferences or privileges the Depositary determines that it is not lawful or (after consultation with the Company) not feasible to make such rights, preferences or privileges available to holders of Receipts by the issue of warrants or
otherwise, or (ii) if and to the extent so instructed by holders of Receipts who do not desire to execute such rights, preferences or privileges, then the Depositary, in its discretion (with approval of the Company, in any case where the Depositary
has determined that it is not feasible to make such rights, preferences or privileges available), may, if applicable laws or the terms of such rights, preferences or privileges permit such transfer, sell such rights, preferences or privileges at
public or private sale, at such place or places and upon such terms as it may deem proper. The net proceeds of any such sale shall, subject to Sections 3.1 and 3.2, be distributed by the Depositary to the record holders of Receipts entitled thereto
as provided by Section 4.1 in the case of a distribution received in cash. 
  
 If registration under the Securities Act of the securities to which any rights, preferences or privileges relate is required in order for holders of Receipts to be offered or sold the securities to which such rights,
preferences or privileges relate, the Company will file promptly a registration statement pursuant to the Securities Act with respect to such rights, preferences or privileges and securities and use its best efforts and take all steps available to
it to cause such registration statement to become effective sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or privileges. In no event shall the
Depositary make available to the holders of Receipts any right, preference or privilege to subscribe for or to purchase any securities unless and until it has received written notice from the Company that such registration statement shall have
become effective, or that the offering and sale of such securities to such holders are exempt from registration under the provisions of the Securities Act and the Company shall have provided to the Depositary an opinion of counsel reasonably
satisfactory to the Depositary to such effect. 
  
 If any other
action under the laws of any jurisdiction or any governmental or administrative authorization, consent or permit is required in order for such rights, preferences or privileges to be made available to holders of Receipts, the Company will use its
reasonable best efforts to take such action or obtain such authorization, consent or permit sufficiently in advance of the expiration of such rights, preferences or privileges to enable such holders to exercise such rights, preferences or
privileges. 
  

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 SECTION 4.4 Notice of Dividends, etc.; Fixing Record Date for Holders of Receipts. Whenever any
cash dividend or other cash distribution shall become payable or any distribution other than cash shall be made, or if rights, preferences or privileges shall at any time be offered, with respect to Stock, or whenever the Depositary shall receive
notice of any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice, or whenever the Depositary and the Company shall decide it is appropriate, the Depositary shall in each such instance fix a
record date (which shall be the same date as the record date fixed by the Company with respect to or otherwise in accordance with the terms of the Stock) for the determination of the holders of Receipts who shall be entitled to receive such
dividend, distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or to give instructions for the exercise of voting rights at any such meeting, or who shall be entitled to notice of such meeting or for any other
appropriate reasons. 
  
 SECTION 4.5 Voting Rights. Upon
receipt of notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Receipts as of the record date for such meeting a notice which shall contain
(i) such information as is contained in such notice of meeting, (ii) a statement that the holders may, subject to any applicable restrictions, instruct the Depositary as to the exercise of the voting rights pertaining to the amount of Stock
represented by their respective Depositary Shares (including an express indication that instructions may be given to the Depositary to give a discretionary proxy to a person designated by the Company), and (iii) a brief statement as to the manner in
which such instructions may be given. Upon the written request of the holders of Receipts on the relevant record date, the Depositary shall use its best efforts to vote or cause to be voted, in accordance with the instructions set forth in such
requests, the maximum number of whole shares of Stock represented by the Depositary Shares evidenced by all Receipts as to which any particular voting instructions are received. The Company hereby agrees to take all action which may be deemed
necessary by the Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of a Receipt, the Depositary will abstain from voting to the extent of the
Stock represented by the Depositary Shares evidenced by such Receipt. 
  
 SECTION 4.6 Changes Affecting Deposited Securities and Reclassifications, Recapitalizations, etc. Upon any change in par value or liquidation preference, split-up, combination or any other reclassification of the Stock, or upon any
recapitalization, reorganization, merger or consolidation affecting the Company or to which it is a party, the Depositary may in its discretion with the approval (not to be unreasonably withheld) of, and shall upon the instructions of, the Company,
and (in either case) in such manner as the Depositary may deem equitable, (i) make such adjustments in the fraction of an interest in one share of Stock represented by one Depositary Share as may be necessary (as certified by the Company) fully to
reflect the effects of such change in par value or liquidation preference, split-up, combination or other reclassification of Stock, or of such recapitalization, reorganization, merger or consolidation and (ii) treat any securities which shall be
received by the Depositary in exchange for or upon conversion of or in respect of the Stock as new deposited securities so received in exchange for or upon conversion or in respect of such Stock. In any such case, the Depositary may in its
discretion, with the approval of the Company, execute and deliver additional Receipts or may call for the surrender of all outstanding Receipts to be exchanged for new Receipts 
  

 - 10 - 

 specifically describing such new deposited securities. Anything to the contrary herein notwithstanding, holders of
Receipts shall have the right from and after the effective date of any such change in par value or liquidation preference, split-up, combination or other reclassification of the Stock or any such recapitalization, reorganization, merger or
consolidation to surrender such Receipts to the Depositary with instructions to convert, exchange or surrender the Stock represented thereby only into or for, as the case may be, the kind and amount of shares of stock and other securities and
property and cash into which the Stock represented by such Receipts would have been converted or for which such Stock would have been exchanged or surrendered had such Receipt been surrendered immediately prior to the effective date of such
transaction. 
  
 SECTION 4.7 Delivery of Reports. The
Depositary shall furnish to holders of Receipts any reports and communications received from the Company which are received by the Depositary as the holder of Stock. In addition, the Depositary will make available for inspection by holders of
Receipts at the Depository’s Office, and at such other places as it may from time to time deem advisable, any reports and communications received from the Company which are received by the Depositary as the holder of Stock. 
  
 SECTION 4.8 List of Receipt Holders. Promptly upon request from time
to time by the Company, the Depositary shall furnish to it a list, as of the most recent practicable date, of the names, addresses and holdings of Depositary Shares of all record holders of Receipts. The Company shall be entitled to receive such
list four times annually without charge. 
  
 ARTICLE V 

 
 The Depositary, the Depositary’s 
 Agents, the Registrar and the Company 
  
 SECTION 5.1 Maintenance of Offices, Agencies and Transfer Books by the Depositary; Registrar. Upon execution of this Deposit Agreement, the
Depositary shall maintain at the Depositary’s Office facilities for the execution and delivery, registration and registration of transfer, surrender and exchange of Receipts, and at the offices of the Depositary’s Agents, if any,
facilities for the delivery, registration of transfer, surrender and exchange of Receipts, all in accordance with the provisions of this Deposit Agreement. 
  
 The Depositary shall keep books at the Depositary’s Office for the registration and registration of transfer of Receipts, which books during normal
business hours shall be open for inspection by the record holders of Receipts; provided that any such holder requesting to exercise such right shall certify to the Depositary that such inspection shall be for a proper purpose reasonably related to
such person’s interest as an owner of Depositary Shares evidenced by the Receipts. 
  
 The Depositary may close such books, at any time or from time to time, when deemed expedient by it in connection with the performance of its duties hereunder. 
  
 The Depositary may, with the approval of the Company, appoint a Registrar for
registration of the Receipts or the Depositary Shares evidenced thereby. If the Receipts or the 
  

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 Depositary Shares evidenced thereby or the Stock represented by such Depositary Shares shall be listed on one or more
national securities exchanges, the Depositary will appoint a Registrar (acceptable to the Company) for registration of such Receipts or Depositary Shares in accordance with any requirements of such exchange. Such Registrar (which may be the
Depositary if so permitted by the requirements of any such exchange) may be removed and a substitute registrar appointed by the Depositary upon the request or with the approval of the Company. If the Receipts, such Depositary Shares or such Stock
are listed on one or more other stock exchanges, the Depositary will, at the request and at the expense of the Company, arrange such facilities for the delivery, registration, registration of transfer, surrender and exchange of such Receipts, such
Depositary Shares or such Stock as may be required by law or applicable securities exchange regulation. 
  
 The Depositary may from time to time appoint Depositary’s Agents to act in any respect for the Depositary for the purposes of this Deposit Agreement
and may at any time appoint additional Depositary’s Agents and vary or terminate the appointment of such Depositary’s Agents. The Depositary will notify the Company of any such action. 
  
 SECTION 5.2 Prevention of or Delay in Performance by the Depositary, the
Depositary’s Agents, the Registrar or the Company. Neither the Depositary nor any Depositary’s Agent nor the Registrar nor the Company shall incur any liability to any holder of any Receipt if by reason of any provision of any present
or future law, or regulation thereunder, of the United States of America or of any other governmental authority or, in the case of the Depositary, the Depositary’s Agent or the Registrar, by reason of any provision, present or future, of the
Company’s Articles of Incorporation or by reason of any act of God or war or other circumstance beyond the control of the relevant party, the Depositary, the Depositary’s Agent, the Registrar or the Company shall be prevented, delayed or
forbidden from, or subjected to any penalty on account of, doing or performing any act or thing which the terms of this Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary’s Agent, the Registrar or the
Company incur liability to any holder of a Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing which the terms of this Deposit Agreement shall provide shall or may be done or performed,
or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in this Deposit Agreement except, in the case of any such exercise or failure to exercise discretion not caused as aforesaid, if caused by the gross
negligence, willful misconduct or bad faith of the party charged with such exercise or failure to exercise. 
  
 SECTION 5.3 Obligation of the Depositary, the Depositary’s Agents, the Registrar and the Company. Neither the Depositary nor any
Depositary’s Agent nor the Registrar nor the Company assumes any obligation or shall be subject to any liability under this Deposit Agreement or any Receipt to holders of Receipts other than for its gross negligence, willful misconduct or bad
faith. 
  
 Neither the Depositary nor any Depositary’s Agent
nor the Registrar nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding in respect of the Stock, the Depositary Shares or the Receipts which in its reasonable opinion may involve it in
expense or liability unless indemnity reasonably satisfactory to it against expense and liability be furnished as often as may be reasonably required. 
  

 - 12 - 

 Neither the Depositary nor any Depositary’s Agent nor the Registrar nor the Company shall be liable
for any action or any failure to act by it in reliance upon the written advice of legal counsel or accountants, or information from any holder of a Receipt or any other person believed by it in good faith to be competent to give such information.
The Depositary, any Depositary’s Agent, the Registrar and the Company may each rely and shall each be protected in acting upon any written notice, request, direction or other document reasonably believed by it to be genuine and to have been
signed or presented by the proper party or parties. 
  
 The
Depositary shall not be responsible for any failure to carry out any instruction to vote any of the shares of Stock or for the manner or effect of any such vote made, as long as any such action or non-action is in good faith. The Depositary will
indemnify the Company and hold it harmless from any loss, liability or expense (including the reasonable costs and expenses of defending itself) which may arise out of acts performed or omitted by the Depositary, including when such Depositary acts
as Registrar, or the Depositary’s Agents in connection with this Agreement due to its or their gross negligence, willful misconduct or bad faith. The indemnification obligations of the Depositary set forth in this Section 5.3 shall survive any
termination of this Agreement and any succession of any Depositary. 
  
 The Depositary, its parent, affiliates or subsidiaries, the Depositary’s Agents, and the Registrar may own, buy, sell and deal in any class of securities of the Company and its affiliates and in Receipts or Depositary Shares or become
pecuniarily interested in any transaction in which the Company or its affiliates may be interested or contract with or lend money to or otherwise act as fully or as freely as if it were not the Depositary, parent, affiliate or subsidiary or
Depositary’s Agent or Registrar hereunder. The Depositary may also act as trustee, transfer agent or registrar of any of the securities of the Company and its affiliates. 
  
 It is intended that neither the Depositary nor any Depositary’s Agent nor the Registrar, acting as the
Depositary’s Agent or Registrar, as the case may be, shall be deemed to be an “issuer” of the securities under the federal securities laws or applicable state securities laws, it being expressly understood and agreed that the
Depositary, any Depositary’s Agent and the Registrar are acting only in a ministerial capacity as Depositary or Registrar for the Stock. 
  
 Neither the Depositary (or its officers, directors, employees or agents) nor any Depositary’s Agent nor the Registrar makes any representation or has
any responsibility as to the validity of the registration statement pursuant to which the Depositary Shares are registered under the Securities Act, the Stock, the Depositary Shares or the Receipts (except for its counter-signatures thereon) or any
instruments referred to therein or herein, or as to the correctness of any statement made therein or herein. 
  
 The Depositary assumes no responsibility for the correctness of the description that appears in the Receipts, which can be taken as a statement of the
Company summarizing certain provisions of this Deposit Agreement. Notwithstanding any other provision herein or in the Receipts, the Depositary makes no warranties or representations as to the validity or 
  

 - 13 - 

 genuineness of any Stock at any time deposited with the Depositary hereunder or of the Depositary Shares, as to the
validity or sufficiency of this Deposit Agreement, as to the value of the Depositary Shares or as to any right, title or interest of the record holders of Receipts in and to the Depositary Shares. The Depositary shall not be accountable for the use
or application by the Company of the Depositary Shares or the Receipts or the proceeds thereof. 
  
 SECTION 5.4 Resignation and Removal of the Depositary; Appointment of Successor Depositary. The Depositary may at any time resign as Depositary
hereunder by delivering notice of its election to do so to the Company, such resignation to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided. 
  
 The Depositary may at any time be removed by the Company by notice of such
removal delivered to the Depositary, such removal to take effect upon the appointment of a successor Depositary and its acceptance of such appointment as hereinafter provided. 
  
 In case at any time the Depositary acting hereunder shall resign or be removed, the Company shall, within 60 days after the
delivery of the notice of resignation or removal, as the case may be, appoint a successor Depositary, which shall be a bank or trust company having its principal office in the United States of America and having a combined capital and surplus of at
least $150,000,000. If no successor Depositary shall have been so appointed and have accepted appointment within 60 days after delivery of such notice, the resigning or removed Depositary may petition any court of competent jurisdiction for the
appointment of a successor Depositary. Every successor Depositary shall execute and deliver to its predecessor and to the Company an instrument in writing accepting its appointment hereunder, and thereupon such successor Depositary, without any
further act or deed, shall become fully vested with all the rights, powers, duties and obligations of its predecessor and for all purposes shall be the Depositary under this Deposit Agreement, and such predecessor, upon payment of all sums due it
and on the written request of the Company, shall execute and deliver an instrument transferring to such successor all rights and powers of such predecessor hereunder, shall duly assign, transfer and deliver all right, title and interest in the Stock
and any moneys or property held hereunder to such successor, and shall deliver to such successor a list of the record holders of all outstanding Receipts and such records, books and other information in its possession relating thereto. Any successor
Depositary shall promptly mail notice of its appointment to the record holders of Receipts. 
  
 Any corporation into or with which the Depositary may be merged, consolidated or converted shall be the successor of such Depositary without the execution or filing of any document or any further act, and notice
thereof shall not be required hereunder. Such successor Depositary may authenticate the Receipts in the name of the predecessor Depositary or in the name of the successor Depositary. 
  
 SECTION 5.5 Corporate Notices and Reports. The Company agrees that it will deliver to the Depositary, and the
Depositary will, promptly after receipt thereof, transmit to the record holders of Receipts, in each case at the addresses recorded in the Depositary’s books, copies of all notices and reports (including without limitation financial statements)
required by 
  

 - 14 - 

 law or by the rules of any national securities exchange upon which the Stock, the Depositary Shares or the Receipts are
listed, to be furnished to the record holders of Receipts. Such transmission will be at the Company’s expense and the Company will provide the Depositary with such number of copies of such documents as the Depositary may reasonably request.

  
 SECTION 5.6 Indemnification by the Company. The Company
shall indemnify the Depositary, any Depositary’s Agent and the Registrar against, and hold each of them harmless from, any loss, liability or expense (including the reasonable costs and expenses of defending itself) which may arise out of acts
performed or omitted in connection with this Deposit Agreement and the Receipts by the Depositary, any Registrar or any of their respective agents (including any Depositary’s Agent), except for any liability arising out of gross negligence,
willful misconduct or bad faith on the respective parts of any such person or persons. The obligations of the Company set forth in this Section 5.6 shall survive any succession of any Depositary or Depositary’s Agent. 
  
 SECTION 5.7 Charges and Expenses. The Company shall pay all transfer
and other taxes and governmental charges arising solely from the existence of the depositary arrangements. The Company shall pay charges of the Depositary in connection with the initial deposit of the Stock and the initial issuance of the Depositary
Shares, all withdrawals of shares of the Stock by owners of Depositary Shares, and any redemption of the Stock at the option of the Company. All other transfer and other taxes and governmental charges shall be at the expense of holders of Depositary
Shares. If, at the request of a holder of Receipts, the Depositary incurs charges or expenses for which it is not otherwise liable hereunder, such holder will be liable for such charges and expenses. All other charges and expenses of the Depositary
and any Depositary’s Agent hereunder (including, in each case, reasonable fees and expenses of counsel) incident to the performance of their respective obligations hereunder will be paid upon consultation and agreement between the Depositary
and the Company as to the amount and nature of such charges and expenses. The Depositary shall present its statement for charges and expenses to the Company at such intervals as the Company and the Depositary may agree. 
  
 SECTION 5.8 Tax Compliance. The Depositary, on its own behalf and on
behalf of the Company, will comply with all applicable certification, information reporting and withholding (including “backup” withholding) requirements imposed by applicable tax laws, regulations or administrative practice with respect
to (i) any payments made with respect to the Depositary Shares or (ii) the issuance, delivery, holding, transfer, redemption or exercise of rights under the Receipts or the Depositary Shares. Such compliance shall include, without limitation, the
preparation and timely filing of required returns and the timely payment of all amounts required to be withheld to the appropriate taxing authority or its designated agent. 
  
 The Depositary shall comply with any direction received from the Company with respect to the application of such
requirements to particular payments or holders or in other particular circumstances, and may for purposes of this Agreement rely on any such direction in accordance with the provisions of Section 5.3 hereof. 
  

 - 15 - 

 The Depositary shall maintain all appropriate records documenting compliance with such requirements, and
shall make such records available on request to the Company or to its authorized representatives. 
  
 ARTICLE VI 
  
 Amendment and Termination 
  
 SECTION 6.1
Amendment. The form of the Receipts and any provisions of this Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect which they may deem necessary or desirable;
provided, however, that no such amendment (other than any change in the fees of any Depositary or Registrar, which shall go into effect not sooner than three months after notice thereof to the holders of the Receipts) which shall
materially adversely alter the rights of the holders of Receipts shall be effective unless such amendment shall have been approved by the holders of at least a majority of the Depositary Shares then outstanding. Every holder of an outstanding
Receipt at the time any such amendment becomes effective shall be deemed, by continuing to hold such Receipt, to be bound by the Deposit Agreement as amended thereby. Notwithstanding the foregoing, in no event may any amendment impair the right of
any holder of any Depositary Shares, upon surrender of the Receipts evidencing such Depositary Shares and subject to any conditions specified in this Deposit Agreement, to receive shares of Stock and any money or other property represented thereby,
except in order to comply with mandatory provisions of applicable law. 
  
 SECTION 6.2 Termination. This Deposit Agreement may be terminated by the Company or the Depositary after (i) all outstanding Depositary Shares have been redeemed pursuant to Section 2.8 or (ii) there shall have been made a final
distribution in respect of the Stock in connection with any liquidation, dissolution or winding up of the Company and such distribution shall have been distributed to the holders of Receipts pursuant to Section 4.1 or 4.2, as applicable. 

 
 Upon the termination of this Deposit Agreement, the Company shall be
discharged from all obligations under this Deposit Agreement except for its obligations to the Depositary, the Registrar and any Depositary’s Agent under Sections 5.6 and 5.7. 
  
 ARTICLE VII 
  
 Miscellaneous 
  
 SECTION 7.1 Counterparts. This Deposit Agreement may be executed in any number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall be deemed an original, but all such counterparts taken together shall constitute one and the same instrument. 
  

 - 16 - 

 SECTION 7.2 Exclusive Benefit of Parties. This Deposit Agreement is for the exclusive benefit of
the parties hereto, and their respective successors hereunder, and shall not be deemed to give any legal or equitable right, remedy or claim to any other person whatsoever. 
  
 SECTION 7.3 Invalidity of Provisions. In case any one or more of the provisions contained in this Deposit Agreement
or in the Receipts should be or become invalid, illegal or unenforceable in any respect, the validity, legality and enforceability of the remaining provisions contained herein or therein shall in no way be affected, prejudiced or disturbed thereby.

  
 SECTION 7.4 Notices. Any and all notices to be given to
the Company hereunder or under the Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to the Company at:

  
 PS Business Parks, Inc. 
 701 Western Avenue, 2nd Floor 
 Glendale,
California 91201-2397 
 Facsimile No.: (818) 242-0566 
  
 or at any other address of which the Company shall have notified the Depositary in writing. 
  
 Any and all notices to be given to the Depositary hereunder or under the
Receipts shall be in writing and shall be deemed to have been duly given if personally delivered or sent by mail or by telegram or facsimile transmission confirmed by letter, addressed to the Depositary at the Depositary’s Office, at:

  
 American Stock Transfer & Trust Company 
 59 Maiden Lane 
 Plaza Level 
 New York, NY 10038 
 Attention: Corporate
Trust Department 
 Facsimile No.: 718-236-4588 
  
 or at any other address of which the Depositary shall have notified the Company in writing. 
  
 Any and all notices to be given to any record holder of a Receipt hereunder or under the Receipts shall be in writing and
shall be deemed to have been duly given if personally delivered or sent by mail, or by telegram or facsimile transmission confirmed by letter, addressed to such record holder at the address of such record holder as it appears on the books of the
Depositary, or if such holder shall have filed with the Depositary a written request that notices intended for such holder be mailed to some other address, at the address designated in such request. 
  
 Delivery of a notice sent by mail or by telegram or facsimile transmission
shall be deemed to be effected at the time when a duly addressed letter containing the same (or a confirmation thereof in the case of a telegram or facsimile transmission) is deposited for mailing by first class mail, postage prepaid. The Depositary
or the Company may, however, act upon 
  

 - 17 - 

 any telegram or facsimile transmission received by it from the other or from any holder of a Receipt, notwithstanding
that such telegram or facsimile transmission shall not subsequently be confirmed by letter or as aforesaid. 
  
 SECTION 7.5 Appointment of Registrar. The Company hereby also appoints the Depositary as Registrar in respect of the Receipts and the Depositary
hereby accepts such appointment. 
  
 SECTION 7.6 Holders of
Receipts Are Parties. The holders of Receipts from time to time shall be parties to this Deposit Agreement and shall be bound by all of the terms and conditions hereof and of the Receipts by acceptance of delivery thereof. 
  
 SECTION 7.7 Governing Law. THIS DEPOSIT AGREEMENT AND THE RECEIPTS AND
ALL RIGHTS HEREUNDER AND THEREUNDER AND PROVISIONS HEREOF AND THEREOF SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS APPLICABLE TO CONTRACTS MADE IN AND TO BE PERFORMED IN THE STATE OF NEW YORK, INCLUDING WITHOUT LIMITATION SECTION
5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW. 
  
 SECTION 7.8
Inspection of Deposit Agreement. Copies of this Deposit Agreement shall be filed with the Depositary and the Depositary’s Agent and shall be open to inspection during business hours at the Depositary’s Office or respective offices
of the Depositary’s Agent, if any, by any holder of a Receipt. 
  
 SECTION 7.9 Headings. The headings of articles and sections in this Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereto have been inserted for convenience only and are not to be regarded as a part of this
Deposit Agreement or the Receipts or to have any bearing upon the meaning or interpretation of any provision contained herein or in the Receipts. 
  

 - 18 - 

 IN WITNESS WHEREOF, the Company and the Depositary have duly executed this Agreement as of the day and
year first above set forth, and all holders of Receipts shall become parties hereto by and upon acceptance by them of delivery of Receipts issued in accordance with the terms hereof. 
  

							
	Attested by:	 	PS BUSINESS PARKS, INC.
		
	 /s/ Edward A. Stokx

	 	 /s/ David Goldberg

	Name:	 	Edward A. Stokx	 	Name:	 	David Goldberg
	Title:	 	Secretary	 	Title:	 	Vice President
		
	Attested by:	 	AMERICAN STOCK TRANSFER & TRUST COMPANY
		
	 /s/ Paula Caroppoli

	 	 /s/ Herbert J. Lemmer

	Name:	 	Paula Caroppoli	 	Name:	 	Herbert J. Lemmer
	Title:	 	Vice President	 	Title:	 	Vice President

  
  

 - 19 - 

 EXHIBIT A 
  
 The Shares represented by this Depositary Receipt are subject to restrictions on ownership and transfer for the purpose of assisting this Company to maintain its status
as a Real Estate Investment Trust under the Internal Revenue Code of 1986, as amended. Except as set forth in Article IV of this Company’s Articles of Incorporation, no person may Beneficially Own (i) more than 7.0% of the outstanding shares of
Common Stock of this Company, or (ii) more than 9.9% of the outstanding shares of any series of Preferred Stock or Equity Stock of this Company, with certain further restrictions and exceptions as are set forth in this Company’s Articles of
Incorporation. Any Person who attempts to own or Beneficially Own Shares in excess of the above limitations must notify this Company in writing at least 15 days prior to such attempt. If any of the restrictions on transfer or ownership set forth in
Article IV of the Articles of Incorporation are violated, the Shares represented hereby will be automatically transferred to the Charitable Trustee of a Charitable Trust for the benefit of a Charitable Beneficiary pursuant to the terms of Article IV
of the Articles of Incorporation. In addition, attempted transfers of Shares in violation of the limitations described above (as modified or expanded upon in Article IV of the Articles of Incorporation), may be void ab initio. All
capitalized terms in this legend have the meanings defined in this Company’s Articles of Incorporation, as the same may be amended from time to time. This Company will furnish to the holder hereof, upon request and without charge, a complete
written statement of the terms and conditions of Article IV of the Articles of Incorporation. Requests for such documents may be directed to the corporate secretary. 
  
 DEPOSITARY SHARES 
 THIS DEPOSITARY RECEIPT 
 IS TRANSFERABLE IN 
 NEW YORK, NY 
 SEE REVERSE FOR 
 CERTAIN DEFINITIONS 
 CUSIP 69360J 78 4

  
 DEPOSITARY RECEIPT FOR DEPOSITARY 
 SHARES EACH REPRESENTING 1/1,000th OF A 
 SHARE OF 7.20% CUMULATIVE PREFERRED STOCK, 
 SERIES M OF 
 PS BUSINESS PARKS, INC. 
 INCORPORATED UNDER
THE 
 LAWS OF THE STATE OF CALIFORNIA 
  

 A-1 

 American Stock Transfer & Trust Company, as Depositary (the “Depositary”), hereby certifies that

  
 is the registered owner of
                                        
                                        
                                        
DEPOSITARY SHARES 
  
 (“Depositary Shares”), each Depositary Share
representing a 1/1,000 interest in one share of 7.20% Cumulative Preferred Stock, Series M (the “Stock”), of PS Business Parks, Inc., a California corporation (the “Company”), on deposit with the Depositary, subject to the terms
and entitled to the benefits of the Deposit Agreement dated as of April 27, 2005 (the “Deposit Agreement”), between the Company, the Depositary and the holders from time to time of Depositary Receipts. By accepting this Depositary Receipt,
the holder hereof becomes a party to and agrees to be bound by all the terms and conditions of the Deposit Agreement. This Depositary Receipt shall not be valid or obligatory for any purpose or be entitled to any benefits under the Deposit Agreement
unless it shall have been executed by the Depositary by the manual and/or facsimile signature of a duly authorized officer or, if executed in facsimile by the Depositary, countersigned by a Registrar in respect of the Depositary Receipts by a duly
authorized officer. 
  
 The Company is authorized to issue Common Stock, one or
more series of Preferred Stock, one or more series of Equity Stock and Depositary Shares. The Company will furnish without charge to each receiptholder, who so requests in writing, a statement of the rights, preferences, privileges and restrictions
granted to or imposed upon the respective classes of shares and upon the holders thereof, a copy of the Company’s Bylaws and a copy of the Deposit Agreement. Any such request shall be made to the Company at the principal office of the Company
at 701 Western Avenue, Glendale, California 91201-2397, Attention: Secretary. 
  
 This Depositary Receipt is continued on the reverse hereof and the additional provisions set forth therein (including, without limitation, those relating to redemption) for all purposes have the same effect as if set forth at this place.

  
 Dated: 
  

			
	 Countersigned

	
	 AMERICAN STOCK TRANSFER & TRUST COMPANY

	
	 Depositary, Transfer Agent and

	 Registrar

		
	 By:
	 	  

	 	 	Authorized Officer

  

 A-2 

 THE SHARES REPRESENTED BY THIS DEPOSITARY RECEIPT ARE SUBJECT TO THE PROVISIONS OF THE ARTICLES OF
INCORPORATION OF THE COMPANY, INCLUDING BUT NOT LIMITED TO (1) SECTION (C) OF THE CERTIFICATE OF DETERMINATION RELATING TO THE STOCK, WHICH CONFERS UPON THE BOARD THE RIGHT, ON OR AFTER MAY 2, 2010, TO CALL FOR REDEMPTION THE STOCK AND (2) THE
OWNERSHIP LIMITATION PROVISIONS DESIGNED TO MAINTAIN THE COMPANY’S QUALIFICATION AS A “REAL ESTATE INVESTMENT TRUST” UNDER THE INTERNAL REVENUE CODE OF 1986, AS AMENDED. 
  
 1. The Deposit Agreement. Depositary receipts (“Depositary Receipts”), of which this Depositary Receipt is
one, are made available upon the terms and conditions set forth in the Deposit Agreement, dated as of April 27, 2005 (the “Deposit Agreement”), among the Company, the Depositary and all holders from time to time of Depositary Receipts. The
Deposit Agreement (copies of which are on file at the principal office maintained by the Depositary which at the time of the execution of the Deposit Agreement is located at American Stock Transfer & Trust Company, 59 Maiden Lane, Plaza Level,
New York, NY 10038, Attention: Corporate Trust Department (the “Depositary’s Office”) and at the office of any agent of the Depositary) sets forth the rights of holders of Depositary Receipts and the rights and duties of the
Depositary. The statements made on the face and the reverse of this Depositary Receipt are summaries of certain provisions of the Deposit Agreement and are subject to the detailed provisions thereof, to which reference is hereby made. In the event
of any conflict between the provisions of this Depositary Receipt and the provisions of the Deposit Agreement, the provisions of the Deposit Agreement will govern. 
  
 2. Definitions. Unless otherwise expressly herein provided, all defined terms used in this summary of the Deposit
Agreement shall have the meanings ascribed thereto in the Deposit Agreement. 
  
 3. Redemption of Stock. Whenever the Company shall elect to redeem shares of Stock, it shall (unless otherwise agreed in writing with the Depositary) give the Depositary not less than 60 days’ notice of
the date of such proposed redemption and of the number of such shares of Stock held by the Depositary to be so redeemed and the applicable redemption price. The Depositary shall mail, first-class postage prepaid, notice of the redemption of Stock
and the proposed simultaneous redemption of Depositary Shares representing the Stock to be redeemed, promptly upon receipt of the Company’s notice to redeem shares of Stock and not less than 30 and not more than 60 days prior to the date fixed
for redemption of such Stock and Depositary Shares, to the record holders of the Depositary Receipts evidencing the Depositary Shares to be so redeemed, at the addresses of such holders as the same appear on the records of the Depositary. Any such
notice shall also be published in the same manner as notices of redemption of the Stock are required to be published by the Company. On the date of such redemption, the Depositary shall redeem the number of Depositary Shares representing such
redeemed Stock; provided, that the Company shall then have paid or caused to be paid in full to the Depositary the redemption price of the Stock to be redeemed, plus any accrued and unpaid dividends payable with respect thereto to the date of
any such redemption. In case fewer than all the outstanding Depositary Shares are to be redeemed, the Depositary Shares to be redeemed shall be determined pro rata or by lot in a manner determined by the Board of Directors of the Company. Notice
having been mailed as aforesaid, from and after the Redemption Date (unless the Company shall have failed to provide the funds necessary to redeem the shares of Stock evidenced by the Depositary Shares called for redemption), dividends on the shares
of Stock so called for redemption shall cease to accrue, the Depositary Shares called for redemption shall be deemed no longer to be outstanding and all rights of the holders of Depositary Receipts evidencing such Depositary Shares (except the right
to receive the redemption price) shall, to the extent of such Depositary Shares, cease and terminate. Upon surrender in accordance 
  

 A-3 

 with said notice of the Depositary Receipts evidencing such Depositary Shares (properly endorsed or assigned for
transfer, if the Depositary or applicable law shall so require), such Depositary Shares shall be redeemed at a redemption price per Depositary Share equal to the same fraction of the redemption price per share paid with respect to the shares of
Stock as the fraction each Depositary Share represents of a share of Stock plus the same fraction of all money and other property, if any, represented by such Depositary Shares, including all amounts paid by the Company in respect of dividends which
on the Redemption Date have accumulated on the shares of Stock to be so redeemed and have not theretofore been paid. The foregoing is subject further to the terms and conditions of the Certificate of Determination. If fewer than all of the
Depositary Shares evidenced by this Depositary Receipt are called for redemption, the Depositary will deliver to the holder of this Depositary Receipt upon its surrender to the Depositary, together with the redemption payment, a new Depositary
Receipt evidencing the Depositary Shares evidenced by such prior Depositary Receipt and not called for redemption. 
  
 4. Surrender of Depositary Receipts and Withdrawal of Stock. Upon surrender of this Depositary Receipt to the Depositary at the Depositary’s
Office or at such other offices as the Depositary may designate, and subject to the provisions of the Deposit Agreement, the holder hereof is entitled to withdraw, and to obtain delivery, without unreasonable delay, to or upon the order of such
holder, any or all of the Stock (but only in whole shares of Stock) and all money and other property, if any, at the time represented by the Depositary Shares evidenced by this Depositary Receipt; provided, however, that, in the event
this Depositary Receipt shall evidence a number of Depositary Shares in excess of the number of Depositary Shares representing the whole number of shares of Stock to be withdrawn, the Depositary shall, in addition to such whole number of shares of
Stock and such money and other property, if any, to be withdrawn, deliver, to or upon the order of such holder, a new Depositary Receipt or Depositary Receipts evidencing such excess number of whole Depositary Shares. 
  
 5. Transfers, Split-ups, Combinations. Subject to the Deposit
Agreement, this Depositary Receipt is transferable on the books of the Depositary upon surrender of this Depositary Receipt to the Depositary, properly endorsed or accompanied by a properly executed instrument of transfer, and upon such transfer the
Depositary shall sign and deliver a Depositary Receipt or Depositary Receipts to or upon the order of the person entitled thereto, all as provided in and subject to the Deposit Agreement. This Depositary Receipt may be split into other Depositary
Receipts or combined with other Depositary Receipts into one Depositary Receipt evidencing the same aggregate number of Depositary Shares evidenced by the Depositary Receipt or Depositary Receipts surrendered; provided, however, that the
Depositary shall not issue any Depositary Receipt evidencing a fractional Depositary Share. 
  
 6. Conditions to Signing and Delivery, Transfer, etc., of Depositary Receipts. Prior to the execution and delivery, registration of transfer, split-up, combination, surrender or exchange of this Depositary
Receipt, the Depositary, any of the Depositary’s Agents or the Company may require any or all of the following: (i) payment to it of a sum sufficient for the payment (or, in the event that the Depositary or the Company shall have made such
payment, the reimbursement to it) of any tax or other governmental charge with respect thereto; (ii) production of proof satisfactory to it as to the identity and genuineness of any signature; and (iii) compliance with such reasonable regulations,
if any, as the Depositary or the Company may establish not inconsistent with the Deposit Agreement. 
  
 7. Suspension of Delivery, Transfer, etc. The deposit of Stock may be refused, the delivery of this Depositary Receipt against Stock may be
suspended, the registration of transfer of Depositary Receipts may be refused and the registration of transfer, surrender or exchange of this Depositary Receipt may be suspended (i) during 
  

 A-4 

 any period when the register of stockholders of the Company is closed or (ii) if any such action is deemed necessary or
advisable by the Depositary, any of the Depositary’s Agents or the Company at any time or from time to time because of any requirement of law or of any government or governmental body or commission, stock exchange or the NASD or under any
provision of the Deposit Agreement. 
  
 8. Amendment. The
form of the Depositary Receipts and any provision of the Deposit Agreement may at any time and from time to time be amended by agreement between the Company and the Depositary in any respect that they may deem necessary or desirable; provided,
however, that no such amendment (other than any changes in the fees of any Depositary or Registrar which shall go into effect not sooner than three months after notice thereof to the holders of the Depositary Receipts) which shall materially
adversely alter the rights of holders of Depositary Receipts shall be effective unless such amendment shall have been approved by the holders of at least a majority of the Depositary Shares then outstanding. The holder of this Depositary Receipt at
the time any such amendment becomes effective shall be deemed, by continuing to hold this Depositary Receipt, to be bound by the Deposit Agreement as amended thereby. In no event shall any amendment impair the right of the owner of the Depositary
Shares evidenced by this Depositary Receipt to surrender this Depositary Receipt with instructions to the Depositary to deliver to the holder the Stock and all money and other property, if any, represented thereby, except in order to comply with
mandatory provisions of applicable law. 
  
 9. Charges and
Expenses. The Company will pay all transfer and other taxes and governmental charges arising solely from the existence of the depositary arrangement, except such charges as are expressly provided in the Deposit Agreement to be at the expense of
holders of Depositary Receipts. 
  
 10. Title to Depositary
Receipts. Title to this Depositary Receipt, when properly endorsed or accompanied by a properly executed instrument of transfer, is transferable by delivery with the same effect as in the case of a negotiable instrument; provided,
however, that until transfer of this Depositary Receipt has been registered on the books of the Depositary, the Depositary may, notwithstanding any notice to the contrary, treat the record holder hereof at such time as the absolute owner hereof
for the purpose of determining the person entitled to distribution of dividends or other distributions or to any notice provided for in the Deposit Agreement and for all other purposes. 
  
 11. Dividends and Distributions. Whenever the Depositary shall receive any cash dividend or other cash distribution
on the Stock, the Depositary shall, subject to the provisions of the Deposit Agreement, distribute to record holders of Depositary Receipts such amounts of such sums as are, as nearly as practicable, in proportion to the respective numbers of
Depositary Shares evidenced by the Depositary Receipts held by such holders; provided, however, that in case the Company or the Depositary shall be required by law to withhold and does withhold from any cash dividend or other cash
distribution in respect of the Stock an amount on account of taxes or as otherwise required by law, regulation or court process, the amount made available for distribution or distributed in respect of Depositary Shares shall be reduced accordingly.
In the event that the calculation of any such cash dividend or other cash distribution to be paid to any record holder on the aggregate number of Depositary Receipts held by such holder results in an amount which is a fraction of a cent, the amount
the Depositary shall distribute to such record holder shall be rounded to the next highest whole cent if such fraction of a cent is equal to or greater than $.005, otherwise such fractional interest shall be disregarded; and upon request of the
Depositary, the Company shall pay the additional amount to the Depositary for distribution. 
  

 A-5 

 12. Subscription Rights, Preferences or Privileges. If the Company shall at any time offer or
cause to be offered to the persons in whose name Stock is registered on the books of the Company any rights, preferences or privileges to subscribe for or to purchase any securities or any rights, preferences or privileges of any other nature, such
rights, preferences or privileges shall in each such instance, subject to the provisions of the Deposit Agreement, be made available by the Depositary to the record holders of Depositary Receipts in such manner as the Depositary shall determine.

  
 13. Notice of Dividends, Fixing of Record Date.
Whenever (i) any cash dividend or other cash distribution shall become payable, or any distribution other than cash shall be made, or any rights, preferences or privileges shall at any time be offered, with respect to the Stock, or (ii) the
Depositary shall receive notice of any meeting at which holders of Stock are entitled to vote or of which holders of Stock are entitled to notice or whenever the Depositary and the Company shall decide it is appropriate, the Depositary shall in each
such instance fix a record date (which shall be the same date as the record date fixed by the Company with respect to the Stock) for the determination of the holders of Depositary Receipts (x) who shall be entitled to receive such dividend,
distribution, rights, preferences or privileges or the net proceeds of the sale thereof, or (y) who shall be entitled to give instructions for the exercise of voting rights at any such meeting or to receive notice of such meeting or for any other
appropriate reasons. 
  
 14. Voting Rights. Upon receipt of
notice of any meeting at which the holders of Stock are entitled to vote, the Depositary shall, as soon as practicable thereafter, mail to the record holders of Depositary Receipts as of the record date for such meeting a notice, which shall contain
(i) such information as is contained in such notice of meeting, (ii) a statement that the holders may, subject to any applicable restrictions, instruct the Depositary as to the exercise of the voting rights pertaining to the Stock represented by
their respective Depositary Shares, and (iii) a brief statement as to the manner in which such instructions may be given. Upon the written request of a holder of this Depositary Receipt on such record date, the Depositary shall use its best efforts
to vote or cause to be voted the Stock represented by the Depositary Shares evidenced by this Depositary Receipt in accordance with the instructions set forth in such request. The Company shall take all action that may be deemed necessary by the
Depositary in order to enable the Depositary to vote such Stock or cause such Stock to be voted. In the absence of specific instructions from the holder of this Depositary Receipt, the Depositary will abstain from voting to the extent of the Stock
represented by the Depositary Shares evidenced by this Depositary Receipt. 
  
 15. Reports, Inspection of Transfer Books. The Depositary shall transmit to the record holders of Depositary Receipts copies of all reports and communications received from the Company that are received by the
Depositary as the holder of Stock. In addition, the Depositary will make available for inspection to the record holders of Depositary Receipts at the Depositary’s Office any reports and communications received from the Company that are received
by the Depositary as the holder of Stock. The Depositary shall keep books at the Depositary’s Office for the registration and transfer of Depositary Receipts, which books at all reasonable times will be open for inspection by the record holders
of Depositary Receipts; provided that any such holder requesting to exercise such right shall certify to the Depositary that such inspection shall be for a proper purpose reasonably related to such person’s interest as an owner of
Depositary Shares. 
  
 16. Liability of the Depositary, the
Depositary’s Agents, the Registrar and the Company. Neither the Depositary nor any Depositary’s Agent nor the Registrar nor the Company shall incur any liability to any holder of this Depositary Receipt, if by reason of any provision
of any present or future law or regulation thereunder of any 
  

 A-6 

 governmental authority or, in the case of the Depositary, the Depositary’s Agent or the Registrar, by reason of any
provision, present or future, of the Company’s Articles of Incorporation or by reason of any act of God or war or other circumstances beyond the control of the relevant party, the Depositary, any Depositary’s Agent, the Registrar or the
Company shall be prevented or forbidden from, or subjected to any penalty on account of, doing or performing any act or thing that the terms of the Deposit Agreement provide shall be done or performed; nor shall the Depositary, any Depositary’s
Agent, the Registrar or the Company incur any liability to any holder of this Depositary Receipt (i) by reason of any nonperformance or delay, caused as aforesaid, in the performance of any act or thing that the terms of the Deposit Agreement
provide shall or may be done or performed, or (ii) by reason of any exercise of, or failure to exercise, any discretion provided for in the Deposit Agreement except, in the case of any such exercise or failure to exercise discretion not caused as
aforesaid, if caused by the gross negligence, willful misconduct or bad faith of the party charged with such exercise or failure to exercise. 
  
 17. Obligations of the Depositary, the Depositary’s Agents, the Registrar and the Company. Neither the Depositary nor any Depositary’s
Agent nor the Registrar nor the Company assumes any obligation or shall be subject to any liability under the Deposit Agreement or this Depositary Receipt to the holder hereof, other than for its gross negligence, willful misconduct or bad faith.

  
 Neither the Depositary nor any Depositary’s Agent nor the
Registrar nor the Company shall be under any obligation to appear in, prosecute or defend any action, suit or other proceeding with respect to the Stock, the Depositary Shares or the Depositary Receipts that in its reasonable opinion may involve it
in expense or liability, unless indemnity reasonably satisfactory to it against expense and liability be furnished as often as may be reasonably required. 
  
 Neither the Depositary nor any Depositary’s Agent nor the Registrar nor the Company will be liable for any action or failure to act by it in reliance
upon the written advice of or information from legal counsel, accountants, any holder of this Depositary Receipt or any other person believed by it in good faith to be competent to give such information. 
  
 18. Termination of Deposit Agreement. The Deposit Agreement may be
terminated by the Company or the Depositary after (i) all outstanding Depositary Shares have been redeemed or (ii) there shall have been made a final distribution in respect of the Stock in connection with any liquidation, dissolution or winding up
of the Company and such distribution shall have been distributed to the holders of Depositary Receipts. 
  
 19. Governing Law. The Deposit Agreement and this Depositary Receipt and all rights thereunder and hereunder and provisions thereof and hereof
shall be governed by, and construed in accordance with, the law of the State of New York, including without limitation Section 5-1401 of the New York General Obligations Law. 
  

 A-7 

 The following abbreviations, when used in the inscription on the face of this Depositary Receipt, shall be construed as
though they were written out in full according to applicable laws or regulations: 
  

			
	   TEN COM - as tenants in common
   TEN ENT - as tenants by the entireties
   JT TEN - as joint tenants with right
                     of survivorship and not as
                     tenants in common
	 	 UNIF GIFT MIN ACT -             Custodian
            
                                        
         (Cust)                (Minor)
                                        
         under Uniform Gifts to Minors
                                        
         Act                     
                                        
                     (State)

		
	 	 	 UNIF TRF MIN ACT -             Custodian (until age
    )
                                        
         (Cust)
                                        
                      under Uniform Transfers
                                        
         (Minor)
                                        
         to Minors Act                     
                                        
                                     (State)

  
 Additional
abbreviations may also be used though not in the above list. 
  

 A-8 

 For Value Received,
                                        
hereby sell, assign and transfer unto 
  
 PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE 
  
 __________________________________ 

 
 __________________________________ 
  
 __________________________________ 
  
 ____________________________________________________________________ 
  
 ____________________________________________________________________ 
  
 PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE 

 
                                       
   Depositary Shares represented by the within Depositary Receipt, and do hereby irrevocably constitute and appoint
                                        
Attorney to transfer the said Depositary Shares on the books of the within named Depositary with full power of substitution in the premises. 
  

					
	 Dated
                    
	 	 Signed
	 	  

  
 NOTICE: THE SIGNATURE TO THIS
ASSIGNMENT MUST CORRESPOND WITH THE NAME AS WRITTEN UPON THE FACE OF THIS DEPOSITARY RECEIPT IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR ANY CHANGE WHATEVER. 
  
 SIGNATURE(S) GUARANTEED 
  

			
	By	 	  

	 	 	THE SIGNATURE(S) SHOULD BE GUARANTEED BY AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM), PURSUANT TO S.E.C. RULE 17Ad-15.

  

 A-9

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