Document:

EX-10.20

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

   

  Execution Version

   

  Exhibit 10.20

   

  Amendment No. 2 to CREDIT, SECURITY AND GUARANTY AGREEMENT (REVOLVING LOAN)

  	This AMENDMENT NO. 2 TO CREDIT, SECURITY AND GUARANTY AGREEMENT (REVOLVING  LOAN) (this “Agreement”) is made as of 23 day of December, 2021, by and among CERUS CORPORATION, a Delaware corporation (“Borrower”), MidCap FUNDING IV Trust, a Delaware statutory trust, as Agent (in such capacity, together with its successors and assigns, “Agent”) and the other financial institutions or other entities from time to time parties to the Credit Agreement referenced below, each as a Lender.

  RECITALS

  A.Agent, Lenders and Borrowers have entered into that certain Credit, Security and Guaranty Agreement (Revolving Loan), dated as of March 29, 2019 (as amended by that certain Amendment No. 1 to Credit, Security and Guaranty Agreement (Revolving Loan), dated as of December 31, 2020 and as further amended, restated, supplemented or otherwise modified prior to the date hereof, the “Existing Credit Agreement” and, as the same is amended hereby and as it may be further amended, modified, supplemented and restated from time to time, the “Credit Agreement”), pursuant to which the Lenders have agreed to make certain advances of money and to extend certain financial accommodations to Borrower in the amounts and manner set forth in the Credit Agreement.

   

  B.Borrower has requested, and Agent and Lenders have agreed, on and subject to the terms and conditions set forth in this Agreement and the other Financing Documents, to (i) increase the Revolving Loan Commitments as set forth in this Agreement and (ii) amend certain other terms of the Existing Credit Agreement in accordance with the terms and conditions set forth in this Agreement.  

  AGREEMENT

  NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set forth in this Agreement, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Agent, Lenders and Borrower hereby agree as follows:

  1.Recitals.  This Agreement shall constitute a Financing Document and the Recitals and each reference to the Credit Agreement, unless otherwise expressly noted, will be deemed to reference the Credit Agreement as amended hereby.  The Recitals set forth above shall be construed as part of this Agreement as if set forth fully in the body of this Agreement and capitalized terms used but not otherwise defined herein shall have the meanings ascribed to them in the Credit Agreement (including those capitalized terms used in the Recitals hereto).

  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  2.Amendment to Existing Credit Agreement.  Subject to the terms and conditions of this Agreement, including, without limitation, the conditions to effectiveness set forth in Section 4 below, the Existing Credit Agreement is hereby amended as follows:

  (a)The definition of “Additional Tranche” set forth in Section 1.1 of the Existing Credit Agreement is hereby amended and restated in its entirety to read as follows: 

  ““Additional Tranche” means an additional amount of Revolving Loan Commitments equal to $5,000,0000 (it being acknowledged that multiple Additional Tranches are permitted pursuant to Section 2.1(c) in minimum amounts of $[*] each, up to, in the aggregate, the amount of the Additional Tranche).”

  (b)Section 1.1 of the Existing Credit Agreement is amended by adding the following defined terms in the appropriate alphabetical order therein:

  “Second Amendment” means that certain Amendment No. 2 to Credit, Security and Guaranty Agreement (Revolving Loan), dated as of December 23, 2021, by and among the Borrower, the Lenders and Agent.”

   

  “Second Amendment Effective Date” means December 23, 2021.”

   

  (c)The last sentence of the definition of “Revolving Loan Commitment Amount” in Section 1.1 of the Existing Credit Agreement is amended by deleting such sentence in its entirety and replacing it with the following: 

  “For the avoidance of doubt, the aggregate Revolving Loan Commitment Amount of all Lenders on the Closing Date shall be $5,000,000, as of the First Amendment Effective Date shall be $10,000,000 and as of the Second Amendment Effective Date shall be $15,000,000 and if the Additional Tranche is fully activated by Borrowers pursuant to the terms of the Agreement such amount shall increase to $20,000,000.”

   

  (d)The Commitment Annex attached as Annex A to the Existing Credit Agreement is hereby amended by deleting such annex in its entirety and replacing it with the Commitment Annex attached hereto as Exhibit A. 

  3.Representations and Warranties; Reaffirmation of Security Interest.  

  (a)Each Borrower hereby confirms that all of the representations and warranties set forth in the Credit Agreement are true and correct in all material respects (without duplication of any materiality qualifier in the text of such representation or warranty) with respect to such Borrower as of the date hereof except to the extent that any such representation or warranty relates to a specific date in which case such representation or warranty shall be true and correct as of such earlier date.  Without limiting the foregoing, each Borrower represents and warrants that prior to and after giving effect to the agreements set forth herein, no Default or Event of Default shall exist under any of the Financing Documents. Nothing herein is intended to impair or limit the validity, priority or extent of Agent’s security interests in and Liens, including, without limitation, the Dutch Deeds of Pledge (Cerus), on the Collateral.  Each Borrower acknowledges and agrees that the Credit Agreement, the other Financing Documents and this Agreement constitute the legal, valid and binding obligation of such Borrower, and are enforceable against such Borrower in accordance with its terms, except as the enforceability thereof may be limited by bankruptcy, insolvency or other similar laws relating to the enforcement of creditors’ rights generally and by general equitable principles.  Each 

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  Borrower hereby confirms that the Collateral will (i) not be affected by this Agreement and will continue to be in full force and effect and (ii) extend to the liabilities and obligations of the Credit Parties under the Existing Credit Agreement as amended by this Agreement, including any increase of any liabilities or obligations of any Credit Party thereunder.

  (b)Attached hereto as Schedule 1 is a true and correct copy of the Credit Parties’ corporate organizational chart, as in effect on the date of this Agreement.

  (c)Attached hereto as Schedule 2 is a true and correct list of each Deposit Account and Securities Account of the Credit Parties, as of the date of this Agreement.

   

  4.Conditions to Effectiveness.  This Agreement shall become effective as of the date on which each of the following conditions has been satisfied: 

  (a)Agent shall have received (including by way electronic transmission) a duly authorized, executed and delivered counterpart of the signature page to this Agreement from each Borrower, Agent and each Lender;

  (b)Agent shall have received a certificate from an officer (or another authorized person) of the Borrower certifying as to (i) the names and signatures of each officer or authorized signatories of the Borrower authorized to execute and deliver this Agreement and all documents executed in connection therewith or confirming the certifications delivered to Agent on the Closing Date, (ii) the Organizational Documents (as defined in the Credit Agreement) of the Borrower attached to such certificate are complete and correct copies of such Organizational Documents as in effect on the date of such certification, (iii) the resolutions of the Borrower’s board of directors or other appropriate governing body approving and authorizing the execution, deliver and performance of this Agreement and the other documents executed in connection therewith, and (iv) certificates attesting to the good standing of Borrower in each applicable jurisdiction, together with, if applicable, related tax certificates;

  (c)Agent shall have received reasonably satisfactory results in respect of searches run against the Credit Parties in accordance with Section 7.3 of the Credit Agreement, as Agent may determine reasonably necessary; 

  (d)all representations and warranties of Credit Parties contained herein shall be true and correct in all material respects (without duplication of any materiality qualifier in the text of such representation or warranty) as of the date hereof except to the extent that any such representation or warranty relates to a specific date in which case such representation or warranty shall be true and correct in all material respects as of such earlier date (and such parties’ delivery of their respective signatures hereto shall be deemed to be its certification thereof); and

  (e)immediately prior to and after giving effect to this Agreement, no Default or Event of Default exists under any of the Financing Documents.

  5.Additional Covenants.  Borrower hereby covenants and agrees that it shall, by the date that is forty-five (45) days following the Second Amendment Effective Date (or such later date as Agent may agree in its sole discretion in writing), execute and deliver such agreements, powers of attorney, certificates, and other documents, including, without limitation, next ranking Dutch security documents, reasonably requested by Agent in order to maintain and perfect any security interest (subject to Permitted Liens) in favor of the Agent, for the ratable benefit of the Lenders, in the Collateral.  

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  6.No Waiver or Novation.  The execution, delivery and effectiveness of this Agreement shall not, except as expressly provided in this Agreement, operate as a waiver of any right, power or remedy of Agent, nor constitute a waiver of any provision of the Credit Agreement, the Financing Documents or any other documents, instruments and agreements executed or delivered in connection with any of the foregoing.  Nothing herein is intended or shall be construed as a waiver of any existing Defaults or Events of Default under the Credit Agreement or the other Financing Documents or any of Agent’s rights and remedies in respect of such Defaults or Events of Default.  This Agreement (together with any other document executed in connection herewith) is not intended to be, nor shall it be construed as, a novation of the Credit Agreement.

  7.Affirmation.  Except as specifically amended pursuant to the terms hereof, each Borrower hereby acknowledges and agrees that the Credit Agreement and all other Financing Documents (and all covenants, terms, conditions and agreements therein) shall remain in full force and effect, and are hereby ratified and confirmed in all respects by such Borrower.  Each Borrower covenants and agrees to comply with all of the terms, covenants and conditions of the Credit Agreement and the Financing Documents, notwithstanding any prior course of conduct, waivers, releases or other actions or inactions on Agent’s or any Lender’s part which might otherwise constitute or be construed as a waiver of or amendment to such terms, covenants and conditions.

  8.Miscellaneous.

  (a)Reference to the Effect on the Credit Agreement.  Upon the effectiveness of this Agreement, each reference in the Credit Agreement to “this Agreement,” “hereunder,” “hereof,” “herein,” or words of similar import shall mean and be a reference to the Credit Agreement, as amended by this Agreement.  Except as specifically amended above, the Credit Agreement, and all other Financing Documents (and all covenants, terms, conditions and agreements therein), shall remain in full force and effect, and are hereby ratified and confirmed in all respects by each Borrower.   

  (b)GOVERNING LAW.  THIS AGREEMENT AND ALL DISPUTES AND OTHER MATTERS RELATING HERETO OR THERETO OR ARISING THEREFROM (WHETHER SOUNDING IN CONTRACT LAW, TORT LAW OR OTHERWISE), SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES (OTHER THAN SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW). 

  (c)WAIVER OF JURY TRIAL.   EACH BORROWER, AGENT AND THE LENDERS PARTY HERETO HEREBY IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.  EACH BORROWER, AGENT AND EACH LENDER ACKNOWLEDGES THAT THIS WAIVER IS A MATERIAL INDUCEMENT TO ENTER INTO A BUSINESS RELATIONSHIP, THAT EACH HAS RELIED ON THE WAIVER IN ENTERING INTO THIS AGREEMENT, AND THAT EACH WILL CONTINUE TO RELY ON THIS WAIVER IN THEIR RELATED FUTURE DEALINGS.  EACH BORROWER, AGENT AND EACH LENDER WARRANTS AND REPRESENTS THAT IT HAS HAD THE OPPORTUNITY OF REVIEWING THIS JURY WAIVER WITH LEGAL COUNSEL, AND THAT IT KNOWINGLY AND VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS.

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  (d)Incorporation of Credit Agreement Provisions.  The provisions contained in Section 11.6 (Indemnification), and Section 13.8 (Governing Law; Submission to Jurisdiction) of the Credit Agreement are incorporated herein by reference to the same extent as if reproduced herein in their entirety.

  (e)Headings.  Section headings in this Agreement are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.

  (f)Counterparts.  This Agreement may be signed in any number of counterparts, each of which shall be deemed an original and all of which when taken together shall constitute one and the same instrument.  Delivery of an executed counterpart of this Agreement by facsimile or by electronic mail delivery of an electronic version (e.g., .pdf or .tif file) of an executed signature page shall be effective as delivery of an original executed counterpart hereof and shall bind the parties hereto.   Signatures by facsimile or by electronic mail delivery of an electronic version of any executed signature page shall bind the parties hereto.  In furtherance of the foregoing, the words “execution”, “signed”, “signature”, “delivery” and words of like import in or relating to any document to be signed in connection with this Agreement and the transactions contemplated hereby or thereby shall be deemed to include Electronic Signatures, deliveries or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature, physical delivery thereof or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.  As used herein, “Electronic Signature” means an electronic sound, symbol, or process attached to, or associated with, a contract or other record and adopted by a Person with the intent to sign, authenticate or accept such contract or other record.

  (g)Entire Agreement.	This Agreement constitutes the entire agreement and understanding among the parties hereto and supersedes any and all prior agreements and understandings, oral or written, relating to the subject matter hereof.

  (h)Severability.  In case any provision of or obligation under this Agreement shall be invalid, illegal or unenforceable in any applicable jurisdiction, the validity, legality and enforceability of the remaining provisions or obligations, or of such provision or obligation in any other jurisdiction, shall not in any way be affected or impaired thereby.

  (i) Successors/Assigns.  This Agreement shall bind, and the rights hereunder shall inure to, the respective successors and assigns of the parties hereto, subject to the provisions of the Credit Agreement and the other Financing Documents.

  [SIGNATURES APPEAR ON FOLLOWING PAGES]

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  IN WITNESS WHEREOF, intending to be legally bound, the undersigned have executed this Agreement as of the day and year first hereinabove set forth.

   

   

  AGENT:		MIDCAP FUNDING IV TRUST 

  	 

  By: 	Apollo Capital Management, L.P.,

  its investment manager

   

  By:	Apollo Capital Management GP, LLC,

  its general partner

   

  By:_/s/ Maurice Amsellem_______________________
Name: Maurice Amsellem
Title: Authorized Signatory 

   

   

   

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  LENDER:		MIDCAP FUNDING IV TRUST

   

  By: 	Apollo Capital Management, L.P., 	

  its investment manager

   

  By: 	Apollo Capital Management GP, LLC, 

  its general partner

   

  	 

  By: /s/ Maurice Amsellem________________

  		Name: Maurice Amsellem

  		Title:   Authorized Signatory

   

   

   

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  LENDER:		APOLLO INVESTMENT CORPORATION

   

  		By: Apollo Investment Management, L.P., as Advisor

By: ACC Management, LLC, as its General Partner

By: /s/ Joseph D. Glatt					 
Name: Joseph D. Glatt					
Title: Vice President 					

   

   

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  		
	BORROWERS:
 
 
 
 
	CERUS CORPORATION

By: /s/ Kevin Green	
Name: Kevin Green	
Title: VP, Finance and Chief Financial Officer
 
 
 

   

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  EXHIBIT A

  Annex A to Credit Agreement (Commitment Annex)

   

   

   

  			
	Lender
	Revolving Loan Commitment Amount
	Revolving Loan Commitment Percentage

	MidCap Funding IV Trust
	$[*]
	[*]%

	Apollo Investment Corporation
	$[*]
	[*]%

	TOTALS
	$15,000,000
	100%

   

  		 

   

  10

  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

  SCHEDULE 1

   

  Organizational Chart

   

  [see attached]

  [*]

   

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)

    

  

  [*] = Certain confidential information contained in this document, marked by brackets, has been omitted because it is both (i) not material and (ii) is the type that the registrant treats as private or confidential. 

   

   

  SCHEDULE 2

   

  Deposit Accounts and Securities Accounts

   

  [see attached]

  [*]

   

   

   

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  MidCap / Cerus / Amendment No. 2 (Revolving Loan)psb-20211231 10K (EX-10.20)

		

			Exhibit 10.20

		

		
			
		

		
			October 5, 2021
		

		
			VIA EMAIL
		

		
			﻿
		

		
			Adeel Khan
		

		
			﻿
		

		
			﻿
		

		
			Dear Adeel,
		

		
			﻿
		

		
			It is our pleasure to offer you the position of Executive Vice President, Chief Financial Officer, and Corporate Secretary of PS Business Parks, Inc. (the “Company”).  Your employment and compensation package will be as follows:
		

		
			﻿
		

		
			Title, Duties, Authority: Executive Vice President, Chief Financial Officer, and Corporate Secretary.
		

		
			Reporting to: Dan “Mac” Chandler, III, President and Chief Executive Officer (the “CEO”).
		

		
			Start Date: To be mutually agreed upon, but in no event later than January 10, 2022.
		

		
			Place of Employment: Glendale, California.
		

		
			Base Salary: $425,000 annual base salary (the annual base salary as adjusted from time to time, the “Base Salary”).   The Base Salary will be payable in accordance with the Company’s normal payroll practices (no less frequently than bi-monthly), with such deductions and withholdings as are required by law.
		

		
			Target Annual Cash Incentive: You will be eligible to participate in our annual cash incentive program, with an annual target award level equal to 100% of your Base Salary.  Except as set forth herein, your participation in our annual cash incentive program will be subject to the provisions of the program for the relevant performance period as approved annually by the Compensation Committee of the Board.   The Company’s annual cash incentive program is discretionary, and the Company has the right to modify the program unilaterally.  The Company will pay any annual cash incentive award in accordance with the Company’s normal payroll practices with respect to such annual cash incentive, and with such deductions and withholdings as are required by law.
		

		
			Annual Equity Incentive Plan Target: You will be eligible to participate in our annual performance equity incentive plan, as approved by the Compensation Committee, beginning in the 2022 performance year.   Your annual target award will be no less than the share-equivalent number of restricted stock units (“RSUs”) equal to $800,000, based on the trailing 90-day closing share price average on December 31 prior to the performance year.  RSUs earned on satisfaction 
		

		 

 

		

			 

		

		of performance conditions will vest in five equal installments, with the first installment vesting on the date the Compensation Committee determines the RSUs have been earned or otherwise designates (after the end of the performance year) and annually thereafter, provided you remain employed through the applicable vesting dates.  The annual equity award grant of RSUs will be subject to the terms of (a) the applicable performance equity incentive plan for the relevant performance period as approved by the Compensation Committee of the Board; (b) the PS Business Parks, Inc. 2012 Equity and Performance-Based Incentive Compensation Plan (“2012 Plan”) (or any applicable equity plan then in effect); and (c) the Company’s related standard award agreements.  You will also receive dividend-equivalent rights on earned RSUs.  The Company’s performance equity incentive plan is discretionary, and the Company has the right to modify the plan unilaterally.
		

		
			One-time Sign-on Equity Award: Upon your Start Date (or promptly thereafter), you will receive a one-time RSU award having a value on the grant date equal to $500,000 (the “Sign-On Award”), based on the trailing 90-day closing share price average on the grant date.  The Sign-On Award will vest ratably over 5 years, beginning on the first anniversary of your Start Date, provided you remain employed through the applicable vesting dates.  You will receive dividend-equivalent rights on these RSUs.  These RSUs will be subject to the terms of the 2012 Plan and the Company’s related standard award agreement.
		

		
			Payments upon Termination: You agree that your employment is “at will.”  Either you or the Company may terminate your employment at any time with cause or without cause, for any reason or no reason, for your convenience or for PSBP's convenience, and without prior notice. 
		

		
			Upon termination of your employment for any reason, you will receive payment for any unpaid Base Salary through the date of termination;  reimbursement for any unreimbursed business expenses incurred through the date of termination; any accrued but unused vacation time; and all other payments, benefits or fringe benefits to which you may be entitled under the terms of any applicable compensation arrangement or benefit, equity or fringe benefit plan or program or grant or hereunder or as required by applicable law.
		

		
			Benefits: The Company offers a comprehensive benefits package to its employees including medical, dental, vision, life insurance, disability insurance, a flexible spending plan, and 401(k). You are eligible for participation in these plans on the 1st of the month following thirty (30) days of employment. You will receive standard benefits as provided to you separately.
		

		
			Vacation: You will be entitled to three weeks of paid vacation per year (as prorated for partial years), sick time, and holidays pursuant to the terms of the Company’s vacation policy as may exist from time to time. 
		

		
			Business Expenses: Subject to applicable Company policies, you will be reimbursed for all out-of-pocket business, travel, marketing, entertainment and other similar expenses incurred in the performance of your duties on behalf of the Company, consistent with Company policies. 
		

		
			Code Section 409A: This letter agreement is intended to comply with Internal Revenue Code Section 409A and the regulations promulgated thereunder (“Section 409A”) or an exemption thereunder and shall be construed and administered in accordance with Section 409A. Notwithstanding any other provision hereof, payments provided under hereunder may only be made in a manner that complies with Section 409A or an applicable exemption. Any payments under this letter agreement that may be excluded from Section 409A either as separation pay due to an involuntary separation from service or as a short-term deferral shall be excluded from 
		

		 

		

			2

		

 

		

			 

		

		Section 409A to the maximum extent possible. For purposes of Section 409A, each installment payment provided under this letter agreement shall be treated as a separate payment. Any payments to be made under this letter agreement upon a termination of employment that are considered “nonqualified deferred compensation” for purposes of Section 409A shall only be made upon a “separation from service” under Section 409A. Notwithstanding any other provision of this letter agreement, if any payment or benefit provided to you in connection with your termination of employment is determined to constitute “nonqualified deferred compensation” within the meaning of Section 409A and you are determined to be a “specified employee” as defined in Section 409A(a)(2)(b)(i), then such payment or benefit shall not be paid until the first payroll date to occur following the six-month anniversary of the date of your termination of employment or, if earlier, on your death (the “Specified Employee Payment Date”). The aggregate of any payments that would otherwise have been paid before the Specified Employee Payment Date and interest on such amounts calculated based on the applicable federal rate published by the Internal Revenue Service for the month of your termination of employment shall be paid to you in a lump sum on the Specified Employee Payment Date and thereafter, any remaining payments shall be paid without delay in accordance with their original schedule. To the extent required by Section 409A, each reimbursement or in-kind benefit provided under this letter agreement shall be provided in accordance with the following (a) the amount of expenses eligible for reimbursement, or in-kind benefits provided, during each calendar year cannot affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other calendar year; (b) any reimbursement of an eligible expense shall be paid to you on or before the last day of the calendar year following the calendar year in which the expense was incurred; and (c) any right to reimbursements or in-kind benefits under this letter agreement shall not be subject to liquidation or exchange for another benefit.
		

		
			Outside Service: You shall devote all necessary working time, ability, and attention to the business of the Company during your employment and you shall not, directly or indirectly, render any material services to any business, corporation, or organization, whether for compensation or otherwise, that potentially interferes or conflicts with your service or fiduciary duties to the Company, without the prior knowledge and consent of the CEO and the Board of Directors.
		

		
			Governing Law: This Agreement and the rights and obligations of the parties hereto shall be construed in accordance with the laws of the State of California, without giving effect to the principles of conflict of laws.
		

		
			Amendment: The parties agree that the terms of this letter may not be amended, modified or waived, in whole or in part, except in a writing executed by both parties and subject to any necessary or prudent approvals as the Company may deem necessary in its sole discretion.
		

		
			Contingent Offer: This offer is contingent upon completion of a satisfactory background investigation, drug screen (to the extent permitted by law), and appointment by the Board of Directors.
		

		

		

		 

		

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			We look forward to welcoming you to the Company. Your qualifications and leadership will be a valuable addition to our team. Please contact me if you have any questions.
		

		
			Regards,
		

		
			/s/ Dan M. Chandler, III
		

		
			Dan M. Chandler, III
		

		
			President and Chief Executive Officer
		

		
			PS Business Parks, Inc.
		

		
			Accepted:
		

		
			October 5, 2021/s/ Adeel Khan
		

		
			DateAdeel Khan
		

		 

		

			4

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