Document:

Exhibit 4.3 - 9.30.2014 10-Q

EXHIBIT 4.3

FIRST AMENDMENT TO LOAN AGREEMENT

                

On or as of December 18, 2012, PEOPLES BANCORP INC., an Ohio corporation (“Borrower”) and U.S. BANK NATIONAL ASSOCIATION, a national banking association (“Lender”) entered in a certain Loan Agreement (as amended from time to time, the “Agreement” or the “Loan Agreement”).  Borrower has made certain requests to Lender, including but not limited to that the maximum principal amount of the Revolving Credit Loan be increased from $5,000,000 to $10,000,000, that certain terms and conditions of the Loan Agreement be amended and that Lender consent to certain transactions involving Borrower.  Lender has agreed to such requests subject to certain terms and conditions, including but not limited to the execution of this First Amendment to Loan Agreement (the “First Amendment”), an amendment dated as of the date hereof to the Revolving Credit Note (the “Amendment to Revolving Credit Note”), and certain other documents required by Lender. Borrower has agreed to such terms, conditions and amendments. Borrower and Lender desire to amend the Loan Agreement as set forth below and effective as of the Effective Date (as defined below).

		
	1.
	Amendments.  By this First Amendment, the Loan Agreement hereby is amended as follows:

		
	1.1
	The maximum principal amount of the Revolving Credit Loan is increased from $5,000,000 to $10,000,000 and any and all references to the term “Maximum Revolving Loan Principal Amount” are hereby amended to mean the maximum principal amount of $10,000,000. 

		
	1.2
	Recital D of the Loan Agreement is amended to read as follows:

“D.    The proceeds from the Revolving Credit Loan shall be used by Borrower for any purpose permitted by the laws and regulations applicable to Borrower.”

		
	1.3
	Section 2.1.4 of the Loan Agreement is amended to read as follows:

“2.1.4    Unused Facility Fee.  In addition to all other fees and expenses required to be paid by Borrower to Lender, Borrower shall pay to Lender an unused facility fee (the “Unused Facility Fee”).  The Unused Facility Fee shall be calculated on the last day of each fiscal quarter and shall be due and payable on the fifth day after the end of each fiscal quarter.  The Unused Facility Fee shall be equal to twenty five basis points (25 bps) (0.25%) per annum, calculated quarterly by multiplying 0.0625% by and amount equal to (a) $10,000,000 less (b) the average daily aggregate unpaid balance on the Revolving Credit Note during the fiscal quarter immediately proceeding the Unused Facility Fee due date.  Such fee shall be fully earned when paid and shall not be refunded for any reason.  In the event the Revolving Credit Loan Maturity Date is not on the last day of a fiscal quarter, the Unused Facility Fee for the last fiscal quarter shall be due and payable on the fifth day after the Revolving Credit Loan Maturity Date and shall be equal to twenty five basis points (25 bps) (0.25%) per annum, calculated quarterly by multiplying 0.0625% by and amount equal to (a) $10,000,000 less (b) the average daily aggregate unpaid balance on the Revolving Credit Note during the period commencing on the first day of such fiscal quarter and ending on the Revolving Credit Loan Maturity Date.” 

		
	1.4
	The second sentence of Section 2.2.1 of the Loan Agreement is amended to read as follows:

“The full amount of the Term Loan shall be disbursed at Closing and shall, subject to the Default Rate not being applicable, bear interest at a fixed rate per annum equal to 3.80%, and shall commencing on the date of that certain First Amendment to Loan Agreement dated as of August __, 2014 by and between Borrower and Lender (the “First Amendment”), subject to the Default Rate not being applicable, bear interest at a fixed per annum rate equal to 3.50%.”

		
	1.5
	Section 5.2.1 of the Loan Agreement is amended to read as follows:

“5.2.1    Merger, Consolidation, Loans and Acquisitions.  Neither Borrower nor any Subsidiary shall, without Lender’s prior written consent which shall not be unreasonably withheld or delayed, (a) acquire any other entity; 

(b) consolidate with or merge into any other entity, or permit any other entity to consolidate with or merge into it; (c) make or grant any loan or advance to any officer or shareholder of Borrower and/or any of the Affiliates except in the ordinary course of business with full compliance of all applicable laws and regulations; or (d) pledge, encumber or lien any of its assets (other than to Lender); provided however, notwithstanding the foregoing, (x) Subsidiary Bank shall be permitted to acquire investment, trust and insurance businesses, and (y) Borrower shall be permitted to acquire banks and bank holding companies using its cash and its capital stock, or any combination thereof, if, in the case of such an acquisition by Borrower, all of the following conditions are met: (i) no Event of Default (or circumstance which would, with the passage of time or the giving of notice become an Event of Default) then exists or will exist after giving effect to the subject acquisition, with Borrower being required to submit to Lender a compliance certificate (in a form reasonably acceptable to Lender) dated as of the date of the subject acquisition and signed by Borrower's President or other officer reasonable acceptable to Lender, certifying that no Event of Default (or circumstance which would, with the passage of time or the giving of notice become an Event of Default) then exists or will exist after giving effect to the subject acquisition; (ii) the aggregate assets acquired during any twelve month period are less than $1,000,000,000.00, provided however, that the recent acquisitions or pending acquisitions of Midwest Bancshares, Ohio Heritage Bancorp and North Akron Savings Bank and the potential acquisition of NB&T Financial Group shall not be included in the foregoing $1,000,000,000.00 limitation; and (iii) the acquired banks and/or holding companies operate in the States of Ohio, Kentucky and/or West Virginia or in states contiguous to the States of Ohio, Kentucky and/or West Virginia.”

		
	1.6
	Section 5.8 of the Loan Agreement is amended to read as follows: 

“5.8    Dividends by Subsidiary Bank.  Borrower shall cause the Subsidiary Bank to not issue dividends in an amount greater than such amount permitted by law without requiring prior OCC or other regulatory approval.”
1.7    Section 5.9 of the Loan Agreement is amended to read as follows:

“5.9    Minimum Liquidity.    Borrower at all times shall maintain (on an unconsolidated basis and not including cash or cash equivalents of any Affiliate) a minimum of Two Million Dollars ($2,000,000) in cash and cash equivalents available, to be tested quarterly.”

		
	1.8
	Section 7.4 of the Loan Agreement is amended to read as follows: 

“7.4    Allowance for Loan Losses to Nonperforming Loans.    The Subsidiary Bank shall maintain, and Borrower shall cause the Subsidiary Bank to maintain, a ratio of the Allowances for Loan Losses to Nonperforming Loans (Allowance for Loan Losses divided by Nonperforming Loans) of not less than seventy percent (70%), measured as of the last day of each calendar quarter of the Subsidiary Bank commencing with the fiscal quarter ending December 31, 2012.  For purposes of this Agreement, “Nonperforming Loans” shall mean the sum of all non-accrual loans and loans on which any payment is ninety (90) or more days past due but which continue to accrue interest, but excluding any troubled debt restructurings (so long as any such troubled debt restructurings continue to accrue interest), and “Allowance for Loan Losses” shall have the meaning given to that term in Section 7.3 above.”
1.9    Section 7.5 of the Loan Agreement is amended to read as follows:

“7.5    Minimum Fixed Charge Coverage Ratio.    Borrower (on a consolidated basis) shall maintain a Fixed Charge Coverage Ratio in an amount that equals or exceeds 1.25 to 1.00, commencing with the quarter ending December 31, 2012 and for each quarter thereafter.  The items used in this ratio shall be determined on a trailing twelve (12) month basis.  For purposes of this Section, “Fixed Charge Coverage Ratio” shall mean with respect to the applicable period, the ratio of Borrower’s (i) the sum of net income plus interest expense plus non-cash expenses minus non-cash income minus dividends paid plus any material tax adjusted one time items related to any acquisitions permitted pursuant to Section 5.2.1 of this Agreement, to (ii) the sum of interest expense plus the amount of regularly scheduled principal payments due during the tested period on the Term Loan plus one-fifth (1/5) of the commitment amount of any other indebtedness of Borrower to Lender plus the amount of regularly scheduled principal payments due during the tested period on any indebtedness of Borrower due to any party or entity other than Lender (which, in all cases, shall be derived from the quarterly reports filed with the applicable primary federal regulator and shall be consistent with the financial information and reports contemplated in Section 6 hereof).”

		
	1.10
	Annex A to the form of Quarterly Compliance Certificate (which is attached as an exhibit to the Loan Agreement) is amended and set forth as Exhibit A to this Amendment.

		
	2.
	General.

		
	2.1
	Capitalized terms used herein and not otherwise defined will be given the definitions set forth in the Loan Agreement.

		
	2.2
	Borrower represents and warrants that Borrower has no claims, counterclaims, setoffs, actions or causes of actions, damages or liabilities of any kind or nature whatsoever whether at law or in equity, in contract or in tort, whether now accrued or hereafter maturing (collectively, “Claims”) against Lender, its direct or indirect parent corporation or any direct or indirect affiliates of such parent corporation, or any of the foregoing’s respective directors, officers, employees, agents, attorneys and legal representatives, or the heirs, administrators, successors or assigns of any of them (collectively, “Lender Parties”) that directly or indirectly arise out of, are based upon or are in any manner connected with any Prior Related Event.  As an inducement to Lender to enter into this Amendment, Borrower on behalf of itself, and all of its successors and assigns hereby knowingly and voluntarily releases and discharges all Lender Parties from any and all Claims, whether known or unknown, that directly or indirectly arise out of, are based upon or are in any manner connected with any Prior Related Event.  As used herein, the term “Prior Related Event” means any transaction, event, circumstance, action, failure to act, occurrence of any sort or type, whether known or unknown, which occurred, existed, was taken, permitted or begun at any time prior to the Effective Date (as defined below) or occurred, existed, was taken, was permitted or begun in accordance with, pursuant to or by virtue of any of the terms of the Loan Agreement or any documents executed in connection with the Loan Agreement or which was related to or connected in any manner, directly or indirectly to the extension of credit represented by the Loan Agreement.

		
	2.3
	Except as amended hereby and/or by the Amendment to Revolving Credit Note, the Loan Agreement, the Revolving Credit Note and the Loan Documents shall remain in full force and effect and are hereby ratified and confirmed as obligations of Borrower.  Nothing contained herein shall affect or impair any rights, remedies, or powers of Lender under the Loan Agreement or under any other Loan Document. It is the intent of Borrower and Lender that all Collateral previously granted by Borrower or any Guarantor to Lender under the Loan Documents or otherwise, to secure Borrower’s Obligations shall continue to secure Borrower’s obligations under the Loan Agreement, as amended hereby, and that the aforementioned Loan Documents shall remain in full force and effect.  Any references to the Loan Agreement and/or any Loan Document shall mean such documents as amended from time to time. It is the intent of the parties hereto that the execution and delivery of this Amendment, the Amendment to Revolving Credit Note, or any amendment to any of the Loan Documents in conjunction herewith shall not constitute a novation of the Revolving Credit Loan, the Term Loan or any other Obligations of Borrower to Lender nor shall it affect the priority of any security interest previously granted to Lender securing the obligations under the Loan Agreement or any other Obligation of Borrower to Lender. Except as is explicitly set forth in Section 1 of this Amendment, nothing contained herein shall be construed as obligating Lender to further lend additional funds, increase the principal amount of any Loan, release any Collateral, renew any maturity date or to further extend credit to any party, either now or in the future or to consent to any further modifications of the Loan Agreement.

		
	2.4
	Time is of the essence.

		
	2.5
	Borrower agrees to execute and deliver, or cause to be executed and delivered, in addition to this Amendment, the Amendment Revolving Credit Note and all other documents or instruments deemed necessary by Lender to perfect or continue the perfection of any security interest and Borrower further agrees to pay all fees and out of pocket expenses of Lender charged or incurred in connection with the negotiation, preparation and execution of this Amendment and all related documents and the failure of Borrower to make the aforementioned fees and costs and to execute and deliver, or have executed and delivered, the aforementioned documents shall render this Amendment null and void regardless of the fact that Lender and Borrower may have already executed the Amendment.

		
	2.6
	The representations and warranties of Borrower contained in the Loan Documents are deemed to have been made again on and as of the date of execution of this Amendment, except as such representation and warranties are expressly amended hereby. 

		
	2.7
	Borrower warrants and represents that no Event of Default (as such term is defined in the Loan Agreement) or event or condition which with the lapse of time or giving of notice or both would constitute an Event of Default exists on the date hereof.

		
	2.8
	Lender hereby consents to Borrower’s potential acquisition of NB&T Financial Group and in connection therewith, Borrower incurring indebtedness in the form of Trust Preferred Securities previously issued by NB&T Financial Group.  

		
	2.9
	Nothing contained herein will be construed as waiving any default or Event of Default under the Loan Agreement or any document execution in connection therewith, or will effect or impair any right, power of remedy of Lender under or with respect to any Loan, the Loan Agreement, any Note or any agreement or instrument guaranteeing, securing or otherwise relating to any of the Loans.  Additionally, no course of dealings shall exist or be created by virtue of Lender’s willingness provide its written consent to the waiver of certain terms and conditions of the Loan Agreement and to amend the Loan Agreement, and the fact that Lender may at any time agree to grant certain limited forbearances to Borrower with respect to events of defaults under the Loan Agreement, any Note or any other Loan Document shall not constitute any form of a waiver, modification, amendment, consent by Lender or give rise to any claim or defense of a course of dealings existing between Borrower and Lender.  Any consents, waivers, amendments or modifications of the Loan Agreement, any Note or any other document execution in connection with the Loan Agreement, any Loan or any Note shall be in a writing expressly and specifically stating that it is amending the respective document, agreement or instrument and which shall be fully executed by Borrower and Lender.

		
	2.10
	All representations and warranties made by Borrower herein will survive the execution and delivery of this Amendment.

		
	2.11
	This Amendment will be binding upon and inure to the benefit of Borrower and Lender and their respective successors and assigns. 

		
	2.12
	This Amendment will in all respects be governed and construed in accordance with the laws of the State of Ohio, without regard to Ohio’s conflict of law principles.

    
		
	2.13
	Borrower reaffirms the waiver of jury trial provision contained in the Loan Agreement.

Executed as of August 4, 2014 (the “Effective Date”) and accepted by Lender at Cincinnati, Ohio.

PEOPLES BANCORP INC.

By: ________________________________
Print Name: _________________________
Title: _______________________________

ACCEPTED:

U.S. BANK NATIONAL ASSOCIATION

By:                         
Print Name: Brad Clark
Title: Vice President

EXHIBIT A

Form of Annex A to Quarterly Compliance Certificate

ANNEX A

TO

QUARTERLY COMPLIANCE CERTIFICATE

A.     Capitalization.  (Section 7.1)
(as of the last day of the fiscal quarter ended ___________, 201_)
1.    Borrower
(FRB Capital Guidelines)                 In Compliance         Not In Compliance

2.    Subsidiary Bank 
(Primary Federal Regulator Capital Guidelines)     In Compliance         Not In Compliance

[minimum capital category required: “well capitalized”]

B.    Total Risk‐Based Capital Ratio of Subsidiary Bank.  (Section 7.2)
(as of the last day of the fiscal quarter ended _________, 201__)

1.    Total Capital                                $_____________

2.    Total Risk-Based Assets                            $_____________

3.    Total Capital divided by Total Risk-Based Assets [B.1 divided by B.2]        _____________%

[minimum required total risk‐based capital ratio: 12.5%]

		
	C.
	Nonperforming Assets to the sum of Tangible Capital plus Allowance for Loan Losses Ratio of Subsidiary Bank.  (Section 7.3)

(as of the last day of the fiscal quarter ended _________, 201__)

1.    Total Nonperforming Assets (“NPAs”)                    $    

2.     Tangible Capital (“TC”)                            $    

3.    Allowance for Loan Losses (“ALLs”)                        $_____________

		
	4.
	NPAs divided by the sum of TC plus ALLs 

[C.1 divided by the sum of C.2 plus C.3]                        %

[maximum permitted ‐ 20%]

D.    Allowance for Loan Losses to Nonperforming Loans Ratio of Subsidiary Bank.  (Section 7.4)
(as of the last day of the fiscal quarter ended _________, 201__)

1.    Allowance for Loan Losses (“ALLs”)                    $    

2.     Nonperforming Loans (NPLs”)                        $    

3.    ALLs divided by NPLs [D.1 divided by D.2]                            %

[minimum required ALL: 70% of NPLs]

E.    Fixed Charge Coverage Ratio of Borrower on a consolidated basis  (Section 7.5)
(tested on the last day of the fiscal quarter ended __________, 201_, on a trailing twelve (12) month basis)

1.    Net Income                             $    
2.    Interest expense                            $___________
3.    Non-cash expenses                        $    
4.    Non-cash income                            $    
5    Dividends paid                            $    
6.    Material tax adjusted one time items related to permitted acquisitions    $____________
7.    [E.1. plus E.2. plus E.3. minus E.4 minus E.5. plus E.6.        $    
8.    Interest expense                            $    
9.    Required principal payments on the Term Loan            $    
10.    1/5 of the commitment amount of other indebtedness of Borrower
 to Lender                            $___________
11.    Required principal payments on indebtedness of Borrower to 3rd parties    $___________
12.    [E.8. plus E.8. plus E.10. plus E.11.]                    $    
13.    Fixed Charge Coverage Ratio [E.7. divided by E.12.]                ______ to 1.00
    
[minimum required fixed charge coverage ratio (rolling four quarter basis ‐ 1.25 to 1.00]

G.    Minimum Liquidity  (Section 5.9)
(as of the last day of the fiscal quarter ended __________, 201_)    $_____________

[minimum required is $2,000,000]EX-10.1

 Exhibit 10.1 

PERFORMANCE SHARE UNIT GRANT NOTICE 

UNDER THE 
 LA QUINTA
HOLDINGS INC. 
 2014 OMNIBUS INCENTIVE PLAN 

La Quinta Holdings Inc. (the “Company”), pursuant to its 2014 Omnibus Incentive Plan (the “Plan”), hereby
grants to the Participant set forth below a Performance Share Unit with a Target Value as set forth below. The Performance Share Unit is subject to all of the terms and conditions as set forth herein, in the Performance Share Unit Agreement
(attached hereto or previously provided to the Participant in connection with a prior grant), and in the Plan, all of which are incorporated herein in their entirety. Capitalized terms not otherwise defined herein (including Exhibit A,
attached hereto) shall have the meaning set forth in the Plan. 
  

	 Participant: 
	[Insert Participant Name] 

  

	 Date of Grant: 
	[Insert Date of Grant] 

  

	 Performance Period: 
	The period commencing on          and ending on 

  

	 Target Value: 
	[Insert Participant’s Target Award expressed as a $ value] 

  

	 Actual Value: 
	The Actual Value of the Performance Share Unit granted hereunder shall be determined and, to the extent vested, settled in accordance with, and subject to, the terms and conditions set forth on Exhibit A, attached hereto.

  

	 Vesting: 
	Provided a Participant has not undergone a Termination, the Performance Share Unit shall vest upon the date on which the Committee certifies the achievement of the applicable performance targets set forth on Exhibit A, attached hereto,
which shall occur no later than sixty (60) days following the end of the Performance Period (the “Regular Vesting Date”). 

  

	 	Notwithstanding the foregoing: 

  

	 	(i) in the event of the Participant’s Qualifying Termination prior to the Regular Vesting Date, a portion of the Performance Share Unit shall vest in an amount equal to (x) a fraction the numerator of which equals
the number of elapsed days from the commencement of the Performance Period through the date of Termination, and the denominator of which equals 999, multiplied by (y) the Actual Value, determined on such date of Termination, with the
applicable performance targets being measured as if the last day of the Performance Period was the date of Termination; and 

  

	 	(ii) in the event of a Change in Control prior to the Regular Vesting Date, the Performance Share Unit shall vest in an amount equal to the Actual Value, determined on the date of Termination, with the applicable
performance targets being measured as if the last day of the Performance Period was the date of the Change in Control. 

*        *        * 

 THE UNDERSIGNED PARTICIPANT ACKNOWLEDGES RECEIPT OF THIS PERFORMANCE SHARE UNIT GRANT NOTICE, THE PERFORMANCE
SHARE UNIT AGREEMENT AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF PERFORMANCE SHARE UNIT HEREUNDER, AGREES TO BE BOUND BY THE TERMS OF THIS PERFORMANCE SHARE UNIT GRANT NOTICE, THE PERFORMANCE SHARE UNIT AGREEMENT AND THE PLAN.

  

									
	LA QUINTA HOLDINGS INC.	 		 	PARTICIPANT
			
	  
	 		 	  

	By:	 		 		 		 	
	Title:	 		 		 		 	

 [Signature Page to Performance Share Unit Award] 

 PERFORMANCE SHARE UNIT AGREEMENT 

UNDER THE 
 LA QUINTA
HOLDINGS INC. 
 2014 OMNIBUS INCENTIVE PLAN 

Pursuant to the Performance Share Unit Grant Notice (the “Grant Notice”) delivered to the Participant (as defined in the
Grant Notice), and subject to the terms of this Performance Share Unit Agreement (this “Performance Share Unit Agreement”) and the La Quinta Holdings Inc. 2014 Omnibus Incentive Plan (the “Plan”), La Quinta Holdings
Inc. (the “Company”) and the Participant agree as follows. Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan. 

1. Grant of Performance Share Unit. Subject to the terms and conditions set forth herein and in the Plan, the Company hereby
grants to the Participant the Performance Share Unit as provided in the Grant Notice. The Company may make one or more additional grants of Performance Share Units to the Participant under this Performance Share Unit Agreement by providing the
Participant with a new Grant Notice, which may also include any terms and conditions differing from this Performance Share Unit Agreement to the extent provided therein. The Company reserves all rights with respect to the granting of additional
Performance Share Units hereunder and makes no implied promise to grant additional Performance Share Units. 
 2. Vesting.
Subject to the conditions contained herein and the Plan, the Performance Share Unit shall vest as provided in the Grant Notice. 
 3.
Company; Participant.  
 (a) The term “Company” as used in this Agreement with reference to employment shall
include the Company and its subsidiaries. 
 (b) Whenever the word “Participant” is used in any provision of this Agreement under
circumstances where the provision should logically be construed to apply to the executors, the administrators, or the person or persons to whom the Performance Share Unit may be transferred by will or by the laws of descent and distribution, the
word “Participant” shall be deemed to include such person or persons. 
 4. Non-Transferability. The Performance
Share Unit is not transferable by the Participant except to Permitted Transferees in accordance with Section 14(b) of the Plan. Except as otherwise provided herein, no assignment or transfer of the Performance Share Unit, or of the rights
represented thereby, whether voluntary or involuntary, by operation of law or otherwise, shall vest in the assignee or transferee any interest or right herein whatsoever, but immediately upon such assignment or transfer the Performance Share Unit
shall terminate and become of no further effect. 
 5. Rights as Stockholder. The Participant or a permitted transferee of the
Performance Share Unit shall have no rights as a stockholder with respect to any share of Common Stock underlying the Performance Share Unit unless and until the Participant shall have become the holder of record or the beneficial owner of such
Common Stock, and no adjustment shall be made for dividends or distributions or other rights in respect of such share of Common Stock for which the record date is prior to the date upon which the Participant shall become the holder of record or the
beneficial owner thereof. 
 6. Tax Withholding. The provisions of Section 14(d) of the Plan are incorporated
herein by reference and made a part hereof. 

 7. Notice. Every notice or other communication relating to this Agreement between
the Company and the Participant shall be in writing, and shall be mailed to or delivered to the party for whom it is intended at such address as may from time to time be designated by it in a notice mailed or delivered to the other party as herein
provided; provided that, unless and until some other address be so designated, all notices or communications by the Participant to the Company shall be mailed or delivered to the Company at its principal executive office, to the attention of
the Company Secretary, and all notices or communications by the Company to the Participant may be given to the Participant personally or may be mailed to the Participant at the Participant’s last known address, as reflected in the
Company’s records. Notwithstanding the above, all notices and communications between the Participant and any third-party plan administrator shall be mailed, delivered, transmitted or sent in accordance with the procedures established by such
third-party plan administrator and communicated to the Participant from time to time. 
 8. No Right to Continued Service.
This Agreement does not confer upon the Participant any right to continue as an employee or service provider to the Company. 
 9.
Binding Effect. This Agreement shall be binding upon the heirs, executors, administrators and successors of the parties hereto. 

10. Waiver and Amendments. Except as otherwise set forth in Section 13 of the Plan, any waiver, alteration, amendment or
modification of any of the terms of this Agreement shall be valid only if made in writing and signed by the parties hereto; provided, however, that any such waiver, alteration, amendment or modification is consented to on the Company’s
behalf by the Committee. No waiver by either of the parties hereto of their rights hereunder shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it
is to be construed as a continuing waiver. 
 11. Governing Law. This Agreement shall be construed and interpreted in
accordance with the laws of the State of Delaware, without regard to the principles of conflicts of law thereof. Notwithstanding anything contained in this Performance Share Unit Agreement, the Grant Notice or the Plan to the contrary, if any suit
or claim is instituted by the Participant or the Company relating to this Performance Share Unit Agreement, the Grant Notice or the Plan, the Participant hereby submits to the exclusive jurisdiction of and venue in the courts of Delaware. 

12. Plan. The terms and provisions of the Plan are incorporated herein by reference. In the event of a conflict or inconsistency
between the terms and provisions of the Plan and the provisions of this Agreement, the Plan shall govern and control. 
 13.
Section 409A. It is intended that the Performance Share Unit granted hereunder shall be compliant with Section 409A of the Code and shall be interpreted as such. 

  
 4 

 Exhibit A 

1. Determination of Actual Value of the Performance Share Unit. The Actual Value of the Performance Share Unit Award, if any, for the
Performance Period shall be determined based on the Absolute CAGR TSR and Relative TSR, as set forth in Sections 2 and 3 of this Exhibit A, as further adjusted to reflect dividends declared and paid during the Performance Period (if any), as set
forth in Section 4 of this Exhibit A. 
 2. Total Shareholder Return. For purposes of calculating Total Shareholder Return
(“TSR”), the Company’s TSR performance is calculated as the compounded annual growth rate (“CAGR”), expressed as a percentage (rounded to the nearest tenth of a percentage (0.1%)), in the value per share of
Common Stock during the Performance Period due to the appreciation in the price per share of Common Stock and dividends paid during the Performance Period (assuming dividends are reinvested). 

(a) Absolute CAGR TSR. The Absolute CAGR TSR shall be calculated as follows, expressed as a percentage: 

Cumulative TSR = ((1+TSR Year 1)*(1+TSR Year 2)*(1+TSR Year 3)-1) 

TSR for a given year shall be calculated as: 

TSR = (((Ending Share Price + D)/Beginning Share Price) – 1) 

D = amount of dividends paid to a shareholder of record with respect to one share of Common Stock during the Performance Period. 

Ending Share Price = closing price of a share of Common Stock on the last day of the applicable calendar year, based on the 20-day trailing
average closing price of such Common Stock. 
 Beginning Share Price = closing price of a share of Common Stock on the first day of the
applicable calendar year, based on the 20-day trailing average closing price of such Common Stock; provided that with respect to the portion of the Performance Period relating to April 8, 2014 through December 31, 2014, the
Beginning Share Price shall be the Offering Price. 
 (b) Relative TSR. The Relative TSR shall be calculated in the same manner as
described above in Section 1(a) of this Exhibit A and the relative comparison, expressed in terms of relative percentile ranking, shall be applied to the table set forth below in Section 3 of this Exhibit A. The Relative TSR comparison
shall include the following lodging/hospitality companies; provided, that only companies in the below table that are public throughout the entire Performance Period shall be included for purposes of calculating Relative TSR: 

 

			
	 Choice Hotels International
	  	InterContinental Hotels Group
	 DiamondRock Hospitality Co.
	  	LaSalle Hotel Properties
	 Extended Stay America
	  	Marriott International, Inc.
	 Hersha Hospitality Trust
	  	RLJ Lodging Trust
	 Hilton
	  	Starwood Hotels & Resorts
	 Host Hotels & Resorts, Inc.
	  	Summit Hotel Properties, Inc.
	 Hyatt Hotels Corporation
	  	

 3. Performance Criteria. The performance criteria for the Performance Share Unit shall be
as follows: 
  

											
	 Performance Metric
	  	Weighting	 	 	Threshold
0.33x	  	Target
1.0x	  	Maximum
1.67x
	 Relative TSR v. Peer Group
	  	 	70	% 	 		  		  	
	 Absolute CAGR TSR
	  	 	30	% 	 		  		  	

 In the table above, x = the Target Award. To the extent that the Company’s performance falls between two levels set forth
on the table above, linear interpolation shall apply. In the event that the Company’s performance does not meet the “Threshold” requirements in the table above, no award shall be earned with respect to such Performance Metric. If the
Company’s performance for the Performance Period exceeds the “Maximum” for a Performance Metric, such Performance Metric shall be capped at the “Maximum” amount. 

The resulting value of the Performance Share Unit based on actual performance of the Company during the Performance Period, based on the table set forth in
this Section 3 is hereinafter referred to as the “Initial Actual Value”. 
 4. Adjustments for Dividends. The Actual
Value of the Performance Share Units shall equal the sum of (i) Initial Actual Value, plus (ii) the per share dollar value of any dividends declared and paid on Common Stock during the Performance Period multiplied by
(A) the Initial Actual Value divided by (B) the Offering Price. 
 5. Settlement of Performance Share Unit. As soon
as practicable, but in no event later than thirty (30) days following, the earliest to occur of: (i) the Regular Vesting Date; (ii) the date of Participant’s Qualifying Termination; and (iii) a Change in Control, the Company
will issue shares of Common Stock to the Participant in settlement of the Performance Share Unit; provided, however, that in the event that a Change in Control is the first event to occur, the Committee shall, have the sole discretion
to settle such Performance Share Unit in cash or shares of Common Stock on the date of such Change in Control. The number of shares of Common Stock to be delivered to the Participant in settlement of the Performance Share Unit will be equal to
(x) Actual Value divided by (y) the Offering Price. 
 6. Definitions. 

(a) “Good Reason” shall, in the case of any Participant who is party to an agreement between the Participant and the Company
that contains a definition of “Good Reason”, mean and refer to the definition set forth in such agreement, and in the case of any other Participant, “Good Reason” shall mean: (A) a diminution in Participant’s base
salary or material diminution in Participant ‘s annual bonus opportunity; (B) any material diminution in Participant’s authority, duties or responsibilities; or (C) the relocation of Participant’s principal work location by
more than fifty (50) miles; provided that none of these events shall constitute Good Reason unless the Company fails to cure such event within thirty (30) days after receipt from Participant of written notice of the event which constitutes
Good Reason; provided, further, that “Good Reason” shall cease to exist for an event on the sixtieth (60th) day following the later of its occurrence or Participant’s knowledge thereof, unless Participant has given the
Company’s written notice thereof prior to such date. Notwithstanding anything herein to the contrary, for purposes of the last proviso of the immediately foregoing sentence, a series of related events shall be deemed to have occurred on the
date upon which the last event in such series of related events has occurred. 

  
 6 

 (b) “Offering Price” shall mean the price of a share of Common Stock at which
shares were initially offered to the public in connection with the initial public offering of the Company. 
 (c) “Qualifying
Termination” shall mean Participant’s Termination, prior to a Change in Control, (i) as a result of Participant’s death or Disability; (ii) by the Service Recipient without Cause; or (iii) by the Participant for
Good Reason. 

  
 7

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