Document:

sacqexhibit.htm

    
      
        
        

      

      
        
        

        
        

      

      
        
        

      

    

    

    

    

    

    

    _______________________________________

    

    

    TERM
      LOAN AGREEMENT

    

    

    -
      Between -

    

    

    SOVRAN
      SELF STORAGE, INC. and SOVRAN ACQUISITION LIMITED

    PARTNERSHIP

    

    

    -And-

    

    

    MANUFACTURERS
      AND TRADERS TRUST COMPANY

    

    

    

    Dated
      As Of September 12,2007

    

    

    _______________________________________

    

    
      
              

                         
    

        
        

      

      
        
        

        
        

      

      
        
        

      

    

              TERM
      LOAN AGREEMENT ("Agreement") made as of September 12,2007 by and
      between SOVRAN SELF STORAGE, INC., a Maryland corporation ("Sovran") and SOVRAN
      ACQUISITION LIMITED PARTNERSHIP, a Delaware limited partnership ("SALP", and
      together with Sovran, collectively referred to herein as the "Borrowers" and
      individually as a "Borrower"), each with a principal place of business at 6467
      Main Street, Buffalo, New York 14221 and MANUFACTURERS AND TRADERS TRUST
      COMPANY, a New York State banking corporation, with a principal banking
      office at One M&T Plaza, Buffalo, New York 14203 (the "Bank").

    

    

    WITNESSETH

    

    ARTICLE
      1.  Definitions

    

              1.01     Defnitions.  As
      used in this Agreement, unless otherwise specified, the following terms shall
      have the following respective meanings:

    

              ''Affiliate''
      With reference to any Person, (i) any director or executive officer of that
      Person, (ii) any other Person controlling, controlled by or under direct or
      indirect common , control of that Person, (iii) any other Person directly or
      indirectly holding 10% or more of any class of the capital stock or other equity
      interests (including options, warrants, convertible securities and similar
      rights) of that Person and (iv) any other Person 10% or more of any class of
      whose capital stock or other equity interests (including options, warrants,
      convertible securities and similar rights) is held directly or indirectly by
      that Person.

    

              "Agreement"
      As defined in the preamble hereto, and sometimes referred to herein as "Term
      Loan Agreement".

    

              "Bank"
      As defined in the preamble hereto.

    

              "Borrower"
      or "Borrowers" As defined in the preamble hereto.

    

              "Borrower
      Representative" Sovran, acting on behalf of both of the
      Borrowers.  The Bank shall be entitled to rely, and the Borrowers
      hereby agree, that the Bank may so rely on any notice given or received or
      action taken or not taken by Sovran as being authorized by each of the
      Borrowers.

    

              "Borrowing
      Dates" A Business Day on which the Bank advances a Term Loan to
      the

    Borrowers
      in accordance with Section 2.01.

    "Breakage
      Pee" A fee equal to any loss, cost, expense, including lost profits,
      suffered

    or
      incurred by the Bank as the result of the payment of a LIBOR Rate Loan before
      the end of the

    applicable
      LIBOR Period. The Bank shall provide the Borrowers with a statement setting
      forth

    the
      determination of the Breakage Fee, which determination shall be binding on
      the
      Borrowers if

    computed
      in good faith and without computational error.

    "Business
      Day" (a) Any day excluding Saturday, Sunday and any day on which
      banks

    in
      Buffalo, New York are required or authorized by law or other governmental action
      to close,

    
      
        
        

      

      
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    and
      (b) with respect to LIBOR Rate Loans, any day which is also a Business Day
      described in clause (a) hereof and which is also a day for trading by and
      between banks in U.S. Dollar deposits in the London Interbank Eurodollar
      market.

    

              "Code"
      The Internal Revenue Code of 1986, as amended and in effect from time to
      time.

    

              "Consolidated
      or consolidated" With reference to any term defined herein. shall mean
      that term applied to the accounts of Sovran and its subsidiaries (including
      the
      Guarantors) or SALP and its subsidiaries, as the case may be, consolidated
      in
      accordance with GAAP.

    

              "Credit
      Agreement" The Second Amended and Restated Revolving Credit and Term
      Loan Agreement among Sovran Self Storage, Inc. and Sovran Acquisition Limited
      Partnership and Fleet National Bank and Other Lenders which are or may become
      parties to the Credit Agreement and Fleet National Bank as Administrative Agent
      with Bank of America Securities, LLC as Sole Lead Arranger and Book Runner
      and
      Manufacturers and Traders Trust Company as Syndication Agent and Suntrust Bank
      and PNC Bank, National Association as Co- Documentation Agents dated as of
      December 16,2004, including the Schedules and Exhibits thereto, as
      the same may be from time to time modified, amended or restated and in
      effect.

    

              "Default"
      As of the relevant time of determination, an event or occurrence
      which:

    

    
      	 	
                        (i)     requires
                notice and time to cure to become an Event of Default and as to which
                notice has been given to the Borrowers by the Bank, or

               

                        (ii)     has
                occurred and will become an Event of Default (without notice) if
                such
                event remains uncured after any grace period specified in Section
                9.01 or,
                in the case of matters referred to in Section 9.0l(i), in the other
                applicable Loan Document(s).

            
	 

    

    

              "Disqualifying
      Building Event" Any structural or repair and maintenance matter (other
      than a Release) as to any Building or any Real Estate that in the Bank's
      reasonable opinion will require the expenditure of $250,000 or more to remedy
      or
      complete such matter and the remediation or completion of which is required
      by
      prudent real estate ownership or operation.

    

              "Disqualifying
      Environmental Event" Any Release or threatened Release of Hazardous
      Substances, any violation of Environmental Laws or any other similar
      environmental event with respect to a Real Estate that causes (y) the occupancy
      or rent of such Real Estate to be adversely affected, as compared to what
      otherwise would have been the occupancy or rent of such Real Estate in the
      absence of such environmental event or (z) such Real Estate to no longer be
      financeable on a secured, long term debt basis under the then generally accepted
      underwriting standards of national institutional lenders.

    

              "Disqualifying
      Legal Event" Any violation or non-compliance with any applicable law,
      statute, rule or regulation (other than an Environmental Law) with respect
      to
      any Real Estate, which requires cure or compliance for prudent real estate
      ownership or oepration.

    
      
        
        

      

      
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              "Employee
      Benefit Plan" Any employee benefit plan within the meaning of §3(3) of
      ERISA maintained or contributed to by any Borrower or any ERISA Affiliate,
      other
      than a Multiemployer Plan.

    

              "ERISA"
      The Employee Retirement Income Security Act of 1974, as amended and in effect
      from time to time.

    

              "ERISA
      Affiliate" Any Person which is treated as a single employer with any
      Borrower under §414 of the Code.

    

              "ERISA
      Reportable Event" A reportable event with respect to a Guaranteed
      Pension Plan within the meaning of §4043 of ERISA and the regulations
      promulgated thereunder as to which the requirement of notice has not been
      waived.

    

              "Event
      of Default" See Section 9.01

    

              "Facility
      Fee" See Section 2.07.

    

              "GAAP"
      As of the date of any determination, generally accepted accounting principles
      as
      promulgated by the Financial Accounting Standards Board and/or the American
      Institute of certified Public Accountants, consistently applied and maintained
      throughout the relevant periods and from period to period.

    

              "Guaranties"
      Collectively, the Holdings Guaranty and any other guaranty of the Obligations
      made by an Affiliate of the Borrowers in favor of the Bank.

    

              "Guarantors"
      Collectively, Holdings and any other Affiliate of a Borrower executing a
      Guaranty, provided, however, when the context so requires, Guarantor shall
      refer
      to Holdings or such Affiliate, as appropriate.

    

              "Guaranteed
      Pension Plan" Any employee pension benefit plan within the meaning of
      Section 3(2) of ERISA maintained or contributed to by any Borrower or any
      Guarantor, as the case may be, or any ERISA Affiliate of any of them the
      benefits of which are guaranteed on termination in full or in part by the PBGC
      pursuant to Title IV of ERICA, other than a Multiemployer Plan.

    

              "Hazardous
      Substance" Without limitation, any flammable explosives, radon,
      radioactive materials, asbestos, urea formaldehyde foam insulation,
      polychlorinated biphenyls, petroleum and petroleum based products, methane,
      hazardous materials, hazardous wastes, hazardous or toxic substances or related
      materials as defined in the Comprehensive Environmental Response, Compensation
      and Liability Act of 1980, as amended, (42 U.S.C. Section 9601,
etseq.), the Hazardous Materials Transportation Act, as amended
      (49 U.S.C. Sections 1801, etseq.), the Resource Conservation and
      Recovery Act, as amended (42 U.S.C. Sections 6901, etseq.), the
      Toxic Substances Control Act, as amended, (15 U.S.C. Sections

    
      
        
        

      

      
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    2601,
      etseq.), Articles 15 and 27 of the New York State Environmental
      Conservation Law or any other applicable Environmental Law and in the
      regulations promulgated thereunder.

    

              "Holdings"
      Sovran Holdings Inc., a Delaware corporation and wholly-owned Subsidiary of
      Sovran.

    

              "Holdings
      Guaranty" The Guaranty dated as of the date hereof made by Holdings in
      favor of the Bank pursuant to which Holdings guarantees to the Bank the
      unconditional payment and performance of the Obligations.

    

              "Indebtedness"
      With respect to any Person, all obligations, contingent and otherwise, that
      in
      accordance with GAAP should be classified upon such Person's balance sheet
      as
      liabilities, including, without limitation: (a) all obligations for borrowed
      money and similar monetary obligations, whether direct or indirect; (b) all
      liabilities secured by any mortgage, pledge, negative pledge, security interest,
      lien, charge, or other encumbrance existing on property owned or acquired
      subject thereto, whether or not the liability secured thereby shall have been
      assumed; (c) all obligations (i) under any Capitalized Lease or (ii) under
      any
      Synthetic Lease or (iii) which are "off balance sheet" transactions having
      the
      same practical effect as to such Person's financial position as a transaction
      that would be a liability of such Person on the balance sheet; (d) all
      obligations to purchase, redeem, retire, or otherwise acquire for value any
      shares of capital stock of any class issued by such Person or any rights to
      acquire such shares; (e) all obligations under any forward contract, futures
      contract, swap, option or other financing arrangement, the value of which is
      dependent upon interest rates, currency exchange rates, commodities, any
      Borrower's or Guarantor's present or future beneficial interest, shares or
      security trading value, or other indices; (f) the amount of payments
      received by such person in any forward equity transaction by which such payments
      are received by such Person in consideration for the sale of stock or
      partnership units in such Person when the delivery and/or the determination
      of
      the amount of the stock or units so sold occurs later than one (1) month after
      such Person receives such payment, but only to the extent that the obligation
      to
      deliver such stock or units is not payable solely in the stock or units of
      such
      Person; (g) all guarantees for borrowed money, endorsements and other contingent
      obligations, whether direct or indirect, in respect of indebtedness or
      obligations of others, including any obligation to supply funds (including
      partnership obligations and capital requirements) to or in any manner to invest
      in, directly or indirectly, the debtor, to purchase indebtedness, or to assure
      the owner of indebtedness against loss, through an agreement to purchase goods,
      supplies, or services for the purpose of enabling the debtor to make payment
      of
      the indebtedness held by such owner or otherwise, and the reimbursement
      obligations in respect of any letters of credit, bankers' acceptances or similar
      facilities issued for the account of such Person; (h) all obligations evidenced
      by bonds, debentures, notes or other similar instruments, including obligations
      incurred in connection with the acquisition of property, assets or businesses;
      (i) all obligations issued or assumed as the deferred purchase price of property
      or services (including securities repurchase agreements but excluding trade
      accounts payable or accrued liabilities arising in the ordinary course of
      business which are not overdue or which are being contested in good faith);
      (j)
      all sales of (i) accounts or general intangibles for money due or to become
      due,
      (ii) chattel paper, instruments or documents creating or evidencing a right
      to
      payment of money or (iii) other receivables (collectively "receivables"),
      whether pursuant to a purchase facility or otherwise, other than in connection
      with the disposition of the business

    
      
        
        

      

      
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    operations
      relating thereto or a disposition of defaulted receivables for collection and
      not as a financing arrangement, and together with any obligation to pay any
      discount, interest, fees, indemnities, penalties, recourse, expenses or other
      amounts in connection therewith; and (k) all obligations in respect of
      Indebtedness of any other entity (including any partnership in which such Person
      is a general partner) to the extent that such Person is liable therefor as
      a
      result of such Person's ownership interest in or other relationship with such
      entity, except to the extent that the terms of such Indebtedness provide that
      such Person is not liable therefore and such terms are enforceable under
      applicable law.

    

              "LIBOR
      Increment" One hundred and twenty (120) basis points.

    

              "LIBOR
      Rate Period" A thirty (30) day interest period during which the LIBOR
      Rate is in effect; provided, however, in no event shall a LIBOR Rate Period
      extend beyond the Maturity Date.

    

              "LIBOR
      Rate" The rate per mum (rounded upward, if necessary, to the nearest
      1/16th of 1%)
      obtained by dividing (i) the one-month interest period London Interbank Offered
      Rate as fixed by the British Bankers Association for United States dollar
      deposits in the London Interbank Eurodollar Market at approximately 11:00 a.m.
      London, England time (or as soon thereafter as practicable) as determined by
      the
      Bank from any broker, quoting service or commonly available source utilized
      by
      the Bank by (ii) a percentage equal to 100% minus the stated maximum rate of
      all
      reserves required to be maintained against "Eurocurrency Liabilities" as
      specified in Regulation D (or against any other category of liabilities which
      includes deposits by reference to which the interest rate on LIBOR Rate Loans
      is
      determined or any category of extensions of credit or other assets which
      includes loans by a non-United States' office of a bank to United States'
      residents) on such date to any member bank of the Federal Reserve
      System.  Notwithstanding any provision above, the of rounding to
      determine LIBOR may be discontinued at any time in the Bank's sole
      discretion.

    

              "LIBOR
      Rate Loan" Each Term Loan bearing interest which is calculated by
      reference to the LIBOR Rate plus the LIBOR Increment.

    

              "Loan
      Documents" Collectively, this Term Loan Agreement, the Term Loan Note,
      the Guaranties and any and all other agreements, instruments or documents now
      or
      hereafter evidencing or otherwise relating to the Term Loans and delivered
      to
      the Bank by or on behalf of the Borrowers or any Guarantor, as the same may
      from
      time to time be modified or amended and in effect.

    

              "Maturity
      Date" March 31, 2008.

    

              "Multiemployer
      Plan" Any multiemployer plan within the meaning of §3(37) of ERISA
      maintained or contributed to by any Borrower or any Guarantor as the case may
      be
      or any ERISA Affiliate.

    

              "Obligations"
      All indebtedness, obligations and liabilities of the Borrowers and the
      Guarantors to the Bank under this Term Loan Agreement or any of the other Loan
      Documents or

    
      
        
        

      

      
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    in
      respect of any of the Term Loans made, the Term Loan Note, or other instruments
      at any time evidencing any thereof, whether existing on the date of this Term
      Loan Agreement or arising or incurred hereafter, direct or indirect, joint
      or
      several, absolute or contingent, matured or unmatured, liquidated or
      unliquidated, secured or unsecured, arising by contract, operation of law or
      otherwise.

    

              "Partially
      Owned Entity(ies)" Any of the partnerships, joint ventures and other
      entities owning real estate assets in which SALP and/or Sovran collectively,
      directly or indirectly through its full or partial ownership of another entity,
      own less than 100% of the equity interests, whether or not such entity is
      required in accordance with GAAP to be consolidated with Sovran for financial
      reporting purposes.

    

              "Pension
      Plan" Any pension plan as defined in Section 3(2) of the Employee
      Retirement Income Security Act of 1974 as amended (ERISA) which is a
      multiemployer plan or single employer plan as defined in Section 4001 of ERISA
      and subject to Title IV of ERISA and which is (i) a plan maintained by the
      Borrower or any Subsidiary for employees or former employees of the Borrower
      or
      of any Subsidiary, (ii) a plan to which the Borrower or any Subsidiary
      contributes or is required to contribute, (iii) a plan to which the Borrower
      or
      any Subsidiary was required to make contributions at any time during the five
      (5) calendar years preceding the date of this Agreement, or (iv) any other
      plan
      with respect to which the Borrower or any Subsidiary has incurred or may incur
      liability, including contingent liability, under Title IV of ERISA, to such
      plan
      or to the Pension Benefit Guaranty Corporation.  For purposes of this
      definition and for purposes of Sections 5.16 and 6.19, "Borrower" shall include
      any trade or business (whether or not incorporated) which " together with the
      Borrower or a Subsidiary, is deemed to be a "single employer" within the meaning
      of Section 4001(b)(l) of ERISA.  Each such Pension Plan in existence
      as of the date of this Agreement is listed and identified on Schedule 1 annexed
      hereto.

    

              "PBGC"
      The Pension Benefit Guaranty Corporation created by Section 4002 of ERISA and
      any successor entity or entities having similar responsibilities.

    

              "Permitted
      Liens" Liens, security interests and other encumbrances permitted by
      the terms of the Credit Agreement.

    

              "Prime
      Rate" The rate of interest publicly announced by the Bank from time to
      time as its prime rate and is a base rate for calculating interest on certain
      loans.  The Bank's Prime Rate may or may not be the most favorable
      rate charged by the Bank to its customers.

    

              "Prime
      Rate Loan" Any Loan bearing interest which is calculated by reference
      to the Bank's Prime Rate.

    

              "Principal
      Office" One M&T Plaza, Buffalo, New York 14240.

    

              "Real
      Estate" The fixed and tangible properties consisting of land, buildings
      and/or other improvements to be acquired in fee simple by any Borrower, by
      any
      Subsidiary or by any other

    
      
        
        

      

      
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    entity
      in which a Borrower is the holder of an equity interest at the relevant time
      of
      reference thereto.

    

              "REIT"
      A "real estate investment trust", as such term is defined in Section 856 of
      the
      Code.

    

              "Release"
      The same meaning as given to that term in the Comprehensive Environmental
      Response, Compensation and Liability Act of 1980, as amended (42 U.S.C. Section
      9601, etseq.), and the regulations promulgated
      thereunder.

    

              "Reportable
      Event" Any event with regard to a Pension Plan described in Section
      4043(b) of ERISA, or in regulations issued thereunder.

    

              "SALP"
      As defined in the preamble hereto.

    

              "SEC"
      The United States Securities and Exchange Commission.

    

              "Sovran"
      As defined in the preamble hereto.

    

              "Subsidiary"
      Any entity required to be consolidated with its direct or indirect parent in
      accordance with GAAP.

    

              "Subsidiary"
      Any corporation, association, partnership, trust, or other business entity
      of
      which the designated parent shall at any time own directly or indirectly through
      a Subsidiary or Subsidiaries at least a majority (by number of votes or
      controlling interests) of the outstanding voting interests or at least a
      majority of the economic interests.

    

              "Subsidiary
      Guarantor" Any Guarantor other than Holdings.

    

              "Subsidiary
      Guaranty" The form of Guaranty to be entered into by any Subsidiary
      Guarantor.

    

              "Term
      Loan Commitment" As defined in Section 2.01.

    

              "Term
      Loan(s)" As defined in Section 2.01.

    

              "Term
      Loan Note" As defined in Section 2.02

    

              "Unencumbered
      Property" Any Real Estate located in the contiguous United States that
      on any date of determination:  (a) is not subject to any Liens
      (including any such Lien imposed by the organizational documents of the owner
      of
      such asset, but excluding Permitted Liens), as certified by an officer of the
      Borrower Representative asof the date of this Agreement or such later date
      on
      which such Real Estate becomes an Unencumbered Property, (b) is not the subject
      of any matter that materially adversely affects the value of such Real Estate,
      (c) is not the subject of a Disqualifying Environmental Event, a Disqualifying
      Building Event or a Disqualifying Legal Event, in each case as certified by
      an
      officer of the Borrower Representative on the

    
      
        
        

      

      
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    Preliminary
      Restatement Date or such later date on which such Real Estate becomes an
      Unencumbered Property, (d) has been improved with a Building or Buildings which
      (1) have been issued a certificate of occupancy (where available) or is
      otherwise lawfully occupied for its intended use, (2) are fully operational,
      and
      (3) subsequent to the date that is twenty-four (24) months after the acquisition
      date of such Real Estate, have an average rent-paying occupancy rate (by net
      rentable square feet) of at least 75% for the two most recently ended
      consecutive fiscal quarters, (e) is wholly owned by a Borrower or a Guarantor
      that is a wholly-owned Subsidiary and (f) has not been designated by the
      Borrowers in writing to the Bank as Real Estate that is not an Unencumbered
      Property because of a Disqualifying Environmental Event, a Disqualifying
      Building Event or a Disqualifying Legal Event or the Borrower's intention to
      subject such Unencumbered Property to an indebtedness lien or to sell such
      Unencumbered Property as permitted under the Credit Agreement.

    

              "USA
      Patriot Act" The Uniting and Strengthening America by Providing
      Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT
      Act)
      Act of 2001, as amended from time to time.

    

              1.02     Accounting
      Terms.  All accounting terms not otherwise defined herein have the
      meanings assigned to them in accordance with GAAP consistent with those applied
      in the preparation of the audited consolidated financial statements of the
      Company and its Subsidiaries referred to in this Agreement.

    

    ARTICLE
      2. Amount and Terms of the Term Loan

    

              2.01     Term
      Loan.  Subject to the terms and conditions of this Agreement, and
      relying upon the representations and warranties herein set forth, the Bank
      agrees to make loans (individually, a "Term Loan" and collectively, the "Term
      Loans") to the Borrower on the date of this Agreement and on not more than
      three
      (3) additional Borrowing Dates occurring prior to March 1,2008, up to the
      aggregate principal amount of Twenty-Five Million Dollars ($25,000,000) (the
      "Term Loan Commitment").  Each advance of a Term Loan on a Borrowing
      Date shall be in an amount of not less than Five Million Dollars
      ($5,000,000.00).

    

              2.02     Term
      Loan Note.  The Term Loans shall be evidenced by, and repaid with
      interest in accordance with, a single promissory note (the "Term Loan Note")
      of
      the Borrower in substantially the form of Exhibit A, duly completed and with
      blanks appropriately filled in.  The Term Loan Note shall be dated as
      of the date of this Agreement and the aggregate principal amount of the Term
      Loans evidenced by the Term Loan Note shall be due and payable on the Maturity
      Date.

    

              2.03     Interest.

    

                             (a)     Each
      of the Term Loans shall be advanced to the Borrowers in the form of a LIBOR
      Rate
      Loan, and the Borrowers agree to pay interest to the Bank on the outstanding
      unpaid principal amount of each of the Term Loans commencing on the Borrowing
      Date of each Term Loan continuing to and including the Maturity Date at a rate
      equal to (i) the LIBOR Rate

    
      
        
        

      

      
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    as
      determined by Bank, from time to time, for consecutive LIBOR Periods of thirty
      (30) days, plus (ii) the LIBOR Increment.

    

                             (b)     All
      computations of interest shall be made on the basis of a year of 360 days for
      the actual number of days elapsed. Accrued interest shall be due and payable
      in
      immediately available funds on the first day of each month and on the Maturity
      Date at the Principal Office.  Upon the occurrence of an Event of
      Default or after the Maturity Date, the aggregate unpaid principal of all Term
      Loans shall, at the option of Bank, bear interest as a Prime Rate Loan and
      at a
      rate which is five (5) percentage points per annum greater than that rate which
      would otherwise be applicable.

    

              2.04     Prepayment.  Borrower
      may prepay a LIBOR Rate Loan only upon at least three (3) Business Days prior
      written notice to Bank (which notice shall be irrevocable), and any such
      prepayment shall occur only on the last day of the LIBOR Rate Period for such
      LIBOR Rate Loan. Borrower shall pay to Bank a Breakage Fee as a result of:
      (i)
      any payment of a LIBOR Rate Loan on a date other than the last day of the LIBOR
      Rate Period then in effect; (ii) any failure by Borrower to borrow a LIBOR
      Rate
      Loan on the date specified by Borrower's written notice; (iii) any failure
      by
      Borrower to pay a LIBOR Rate Loan on the date for payment specified in
      Borrower's written notice.  If by reason of an Event of Default, Bank
      elects to declare the Term Loan Note to be immediately due and payable, then
      any
      Breakage Fee with respect to a LIBOR Rate Loan shall become due and payable
      in
      the same manner as though Borrower had exercised such right of
      prepayment.

    

              2.05     Required
      Termination of LIBOR Rate Loans.  In the event Bank shall have
      reasonably determined, at any time (which determination shall be final,
      conclusive and binding), that the making or continuation of the LIBOR Rate
      Loans
      by Bank:

    

                             (a)     adequate
      and reasonable means do not exist for ascertaining the LIBOR Rate for the
      applicable LIBOR Rate Period, or

    

                             (b)     has
      become unlawful by compliance by Bank in good faith with any applicable law,
      governmental rule, regulation, guideline or order, or

    

                             (c)     would
      cause Bank severe hardship as a result of a contingency occurring after the
      date
      of this Agreement which materially and adversely affects the London interbank
      market (such as, but not limited to, disruptions resulting from political or
      economic events);

    

                             then.
      and in either such event, Bank shall on such date (and in any event as soon
      as
      possible after making such determination) give telephonic notice to the
      Borrower, confirmed in writing, of such determination, whereupon at the end
      of
      the then current LIBOR Rate Period, the outstanding principal balance of the
      Term Loans shall convert to a Prime Rate Loan.

    

              2.06     Taxes.  If
      any taxes (other than taxes with respect to the income of Bank), or duties
      of
      any kind shall be payable, or ruled to be payable, by or to any taxing authority
      of or in the United States, or any foreign country, or any political subdivision
      of any thereof, in respect of any of the transactions contemplated by this
      Agreement (including, but not limited to, execution,

    
      
        
        

      

      
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    delivery,
      performance, enforcement, or payment of principal or interest of or under the
      Term Loan Note or this Agreement, or the making of a LIBOR Rate Loan), by reason
      of any now existing or hereafter enacted statute, rule, regulation or other
      determination (excluding any taxes imposed on or measured by the net income
      of
      Bank), the Borrowers will:

    

                             (a)     pay
      on written request therefor all such taxes or duties, including interest and
      penalty, if any,

    

                             (b)     promptly
      furnish Bank with evidence of any such payment, and

    

                             (c)     indemnify
      and hold Bank and any holder or holders of the Term Loan Note harmless and
      indemnified against any liability or liabilities with respect to or in
      connection with any such taxes or the payment thereof or resulting from any
      delay or omission to pay such taxes.

    

              2.07     Facility
      Fee.  Prior to the initial advance of a Term Loan, the Borrowers
      shall pay to Bank a non-refundable Facility Fee in the amount of Sixty-Two
      Thousand Five Hundred Dollars ($62,500.00).

    

    ARTICLE
      3. General Payment Provisions and Use of Proceeds

    

              3.01     Payments.  All
      payments shall be made by Borrower to Bank at the Principal Office or such
      other
      place as Bank may from time to time specify in writing in lawful currency of
      the
      United States of America in immediately available funds, without counterclaim
      or
      setoff and free and clear of, and without any deduction or withholding for,
      any
      taxes or other payments.  All payments shall be applied first to the
      payment of all fees, expenses and other amounts due to the Bank (excluding
      principal and interest), then to accrued interest, and the balance on account
      of
      outstanding principal; provided, however, that after an Event of Default,
      payments will be applied to the Indebtedness of Borrower to Bank as Bank
      determines in its sole discretion.  If any payment under this
      Agreement or the Term Loan Note becomes due on a day which is not a Business
      Day, the due date of this Note or payment shall be extended to the next
      succeeding Business Day, and such extension of time shall be included in
      computing interest and fees in connection with such payment.  If the
      entire amount of any required principal and/or interest is not paid in full
      within five (5) days after the same is due, Borrower shall pay to Bank a late
      fee equal to five percent (5%) of the required payment.

    

              3.02     Usury
      Limitation.  If, at any time, the rate of interest, together with
      all amounts which constitute interest and which are reserved, charged or taken
      by Bank as compensation for fees, services or expenses incidental to the making,
      negotiating or collection of the loan evidenced hereby, shall be deemed by
      any
      competent court of law, governmental agency or tribunal to exceed the maximum
      rate of interest permitted to be charged by Bank to Borrower under applicable
      law, then, during such time as such rate of interest would be deemed excessive,
      that portion of each sum paid attributable to that portion of such interest
      rate
      that exceeds the maximum rate of interest so permitted shall be deemed a
      voluntary prepayment of principal.  As used herein, the term
      "applicable law" shall mean the law in effect as of the date hereof; provided,
      however, that in the event there is a change in the law which results in a
      higher

    
      
        
        

      

      
        10

        
        

      

      
        
        

      

    

    permissible
      rate of interest, then this Agreement and the other Loan Documents shall be
      governed by such new law as of its effective date.

    

              3.03     Use
      of Proceeds.  The Borrower represents to and covenants with the
      Bank that all proceeds of the Term Loans will be used to acquire Real Estate
      and
      additional equity interests in Locke Sovran I LP and Locke Sovran II
      LP.

    

              3.04     Concerning
      Joint and Several Liability of the Borrowers.

    

                             (a)     Each
      of the Borrowers is accepting joint and several liability hereunder and under
      the other Loan Documents in consideration of the financial accommodations to
      be
      provided by the Bank under this Term Loan Agreement, for the mutual benefit,
      directly and indirectly, of each of the Borrowers and in consideration of the
      undertakings of each other Borrower to accept joint and several liability for
      the Obligations.

    

                             (b)     Each
      of the Borrowers, jointly and severally, hereby irrevocably and unconditionally
      accepts, not merely as a surety but also as a co-debtor, joint and several
      liability with the other Borrowers, with respect to the payment and performance
      of all of the Obligations (including, without limitation, any Obligations
      arising under this Section 3.04), it being the intention of the parties hereto
      that all the Obligations shall be the joint and several Obligations of each
      of
      the Borrowers without preferences or distinction among them.

    

                             (c)     If
      and to the extent that any of the Borrowers shall fail to make any payment
      with
      respect to any of the Obligations as and when due or to perform any of the
      Obligations in accordance with the terms thereof, then in each such event the
      other Borrowers will make such payment with respect to, or perform, such
      Obligation.

    

                             (d)     The
      Obligations of each of the Borrowers under the provisions of this Section 3.04
      constitute full recourse Obligations of each of the Borrowers enforceable
      against each such Person to the full extent of its properties and assets,
      irrespective of the validity, regularity or enforceability of this Agreement
      or
      any other circumstance whatsoever.

    

                             (e)     Except
      as otherwise expressly provided in this Term Loan Agreement, each of the
      Borrowers hereby waives notice of acceptance of its joint and several liability,
      notice of any Term Loans made under this Term Loan Agreement, notice of any
      action at any time taken or omitted by the Bank under or in respect of any
      of
      the Obligations, and, generally, to the extent permitted by applicable law,
      all
      demands, notices and other formalities of every kind in connection with this
      Term Loan Agreement.  Each of the Borrowers hereby assents to, and
      waives notice of, any extension or postponement of the time for the payment
      of
      any of the Obligations, the acceptance of any payment of any of the Obligations,
      the acceptance of any partial payment thereon, any waiver, consent or other
      action or acquiescence by the Bank at any time or times in respect of any
      default by any of the Borrowers in the performance or satisfaction of any term,
      covenant, condition or provision of this Term Loan Agreement, any and all other
      indulgences whatsoever by the Bank in respect of any of the Obligations, and
      the
      taking, addition, substitution or release, in whole or in part, at any time
      or
      times, of any security for any of the Obligations or the addition, substitution
      or release, in whole or in part, of any of the

    
      
        
        

      

      
        11

        
        

      

      
        
        

      

    

    Borrowers.  Without
      limiting the generality of the foregoing, each of the Borrowers assents to
      any
      other action or delay in acting or failure to act on the part of the Lenders
      with respect to the failure by any of the Borrowers to comply with any of its
      respective Obligations, including, without limitation, any failure strictly
      or
      diligently to assert any right or to pursue any remedy or to comply fully with
      applicable laws or regulations thereunder, which might, but for the provisions
      of this Section 3.04, afford grounds for terminating, discharging or relieving
      any of the Borrowers, in whole or in part, from any of its Obligations under
      this Section 3.04, it being the intention of each of the Borrowers that, so
      long
      as any of the Obligations hereunder remain unsatisfied, the Obligations of
      such
      Borrowers under this Section 3.04 shall not be discharged except by performance
      and then only to the extent of such performance.  The Obligations of
      each of the Borrowers under this Section 3.04 shall not be diminished or
      rendered unenforceable by any winding up, reorganization, arrangement,
      liquidation, re-construction or similar proceeding with respect to any of the
      Borrowers or the Bank.  The joint and several liability of the
      Borrowers hereunder shall continue in full force and effect notwithstanding
      any
      absorption, merger, amalgamation or any other change whatsoever in the name,
      membership, constitution or place of formation of any of the Borrowers or the
      Bank.

    

    ARTICLE
      4. Guaranties

    

              4.01     Guaranties.  Each
      of the Guarantors will jointly and severally guaranty all of the Obligations
      pursuant to its Guaranty.  The Obligations are full recourse
      obligations of each Borrower and each Guarantor, and all of the respective
      assets and properties of each Borrower and each Guarantor shall be available
      for
      the payment in full in cash and performance of the Obligations.  Other
      than during the continuance of a Default or Event of Default, at the request
      of
      the Borrower Representative, the Guaranty of any Subsidiary Guarantor, except
      the Holdings Guaranty, shall be released by the Bank if and when all of the
      Real
      Estate owned by such Subsidiary Guarantor shall cease to be Unencumbered
      Properties pursuant to the terms of this Agreement.

    

    ARTICLE
      5. Representations and Warranties.

    

    Each
      of the Borrowers for itself and for the other Borrowers and for each Guarantor
      insofar as any such statements relate to such Guarantor represents and warrants
      to the Bank all of the statements contained in this Article 5.

    

              5.01     Authority;
      Etc.

    

                             (a)     Organization:
      Good Standing.

    

                                       (i)     SALP
      is a limited partnership duly organized, validly existing and in good standing
      under the laws of the State of Delaware; Holdings is a corporation duly
      organized, validly existing and in good standing under the laws of the State
      of
      Delaware; each of SALP and Holdings has all requisite partnership or corporate,
      as the case may be, power to own its respective properties and conduct its
      respective business as now conducted and as presently contemplated; and each
      of
      SALP and Holdings is in good standing as a foreign entity and is duly authorized
      to do business in the jurisdictions where the Real Estate owned by it is located
      and in

    
      
        
        

      

      
        12

        
        

      

      
        
        

      

    

    each
      other jurisdiction where such qualification is necessary except where a failure
      to be so qualified in such other jurisdiction would not have a materially
      adverse effect on any of their respective businesses, assets or financial
      conditions.

    

                                       (ii)     Sovran
      is a corporation duly organized, validly existing and in good standing under
      the
      laws of the State of Maryland; each Subsidiary of Sovran is duly organized,
      validly existing and in good standing as a corporation or partnership or other
      entity, as the case may be, under the laws of the state of its organization;
      Sovran and each of its Subsidiaries has all requisite corporate or partnership
      or other entity, as the case may be, power to own its respective properties
      and
      conduct its respective business as now conducted and as now conducted and as
      presently contemplated; and Sovran and each of its Subsidiaries is in good
      standing as a foreign entity and is duly authorized to do business in the
      jurisdictions where such qualification is necessary (including, as to Sovran,
      in
      the State of New York) except where failure to be so qualified in such other
      jurisdiction would not have a materially adverse effect on the business, assets
      or financial condition of Sovran or such Subsidiary.

    

                                       (iii)     As
      to each subsequent Guarantor, a provision similar, as applicable, to (a)(i)
      or
      (ii) above shall be included in each such subsequent Guarantor's Subsidiary
      Guaranty, and the Borrowers shall be deemed to make for itself and on behalf
      of
      each such subsequent Guarantor a representation and warranty as to such
      provision regarding such subsequent Guarantor.

    

                             (b)     Capitalization.

    

                                       (i)     The
      outstanding equity of SALP is comprised of a general partner interest and
      limited partner interests, all of which have been duly issued and are
      outstanding and fully paid and non-assessable.  All of the issued and
      outstanding general partner interests of SALP are owned and held of record
      by
      Holdings. Except as set forth in the Agreement of Limited Partnership of SALP,
      there are no outstanding securities or agreements exchangeable for or
      convertible into or carrying any rights to acquire any equity interests in
      SALP.  There are no outstanding commitments, options, warrants, calls
      or other agreements (whether written or oral) binding on SALP or Sovran which
      require or could require SALP or Sovran to sell, grant, transfer, assign,
      mortgage, pledge or otherwise dispose of any equity interests of
      SALP.  No general partnership interests of SALP are subject to any
      restrictions on transfer or any partner agreements, voting agreements, trust
      deeds, irrevocable proxies, or any other similar agreements or interests
      (whether written or oral).

    

                                       (ii)     The
      issued and outstanding voting and non-voting shares of the common stock of
      Holdings, and all of the other equity interests in Holdings, all of which have
      been duly issued and are outstanding and fully paid and non-assessable, are
      owned and held of record by Sovran.  There are no outstanding
      securities or agreements exchangeable for or convertible into or carrying any
      rights to acquire any equity interests in Holdings, and there are no outstanding
      options, warrants, or other similar rights to acquire any shares of any class
      in
      the capital of or any other equity interests in Holdings.  There are
      no outstanding commitments, options, warrants, calls or other agreements or
      obligations (whether written or oral) binding on Holdings to issue, sell, grant,
      transfer, assign, mortgage, pledge or otherwise dispose of any

    
      
        
        

      

      
        13

        
        

      

      
        
        

      

    

    shares
      of any class in the capital of or other equity interests in
      Holdings.  No shares of, or equity interests in Holdings held by
      Sovran are subject to any restrictions on transfer pursuant to any of Holding's
      applicable charter, by-laws or any shareholder agreements, voting agreements,
      voting trusts, trust agreements, trust deeds, irrevocable proxies or any other
      similar agreements or instruments (whether written or oral).

    

                             (c)     Due
      Authorization.  The execution, delivery and performance of this
      Term Loan Agreement and the other Loan Documents to which any of the Borrowers
      or any of the Guarantors is or is to become a party and the transactions
      contemplated hereby and thereby (i) are within the authority of such
      Borrower and such Guarantor, (ii) have been duly authorized by all necessary
      proceedings on the part of such Borrower or such Guarantor and any general
      partner or other controlling Person thereof, (iii) do not conflict with or
      result in any breach or contravention of any provision of law, statute, rule
      or
      regulation to which such Borrower or such Guarantor is subject or any judgment,
      order, writ, injunction, license or permit applicable to such Borrower or such
      Guarantor, (iv) do not conflict with any provision of the agreement of limited
      partnership, any certificate of limited partnership, the charter documents
      or
      by-laws of such Borrower or such Guarantor or any general partner or other
      controlling Person thereof, and (v) do not contravene any provisions of, or
      constitute a default, Default or Event of Default hereunder or a failure to
      comply with any term, condition or provision of, any other agreement,
      instrument, judgment, order, decree, permit, license or undertaking binding
      upon
      or applicable to such Borrower or such Guarantor or any of such Borrower's
      or
      such Guarantor's properties (except for any such failure to comply under any
      such other agreement, instrument, judgment, order, decree, permit, license,
      or
      undertaking as would not materially and adversely affect the condition
      (financial or otherwise), properties, business or results of operations of
      any
      Borrower, the Operating Subsidiaries or any Guarantor) or result in the creation
      of any mortgage, pledge, security interest, lien, encumbrance or charge upon
      any
      of the properties or assets of any Borrower, the Operating Subsidiaries or
      any
      Guarantor.

    

                             (d)     Enforceability.  Each
      of the Loan Documents to which any of the Borrowers or any of the Guarantors
      is
      a party has been duly executed and delivered and constitutes the legal, valid
      and binding obligations of each such Borrower and each such Guarantor, as the
      case may be, subject only to applicable bankruptcy, insolvency, reorganization,
      moratorium or other laws relating to or affecting generally the enforcement
      of
      creditors' rights and to the fact that the availability of the remedy of
      specific performance or injunctive relief is subject to the discretion of the
      court before which any proceeding therefor may be brought.

    

              5.02     Governmental
      Approvals.  The execution, delivery and performance by each
      Borrower of this Term Loan Agreement and by each Borrower and each Guarantor
      of
      the other Loan Documents to which such Borrower or such Guarantor is or is
      to
      become a party and the transactions contemplated hereby and thereby do not
      require (i) the approval or consent of any governmental agency or authority
      other than those already obtained, or (ii) filing with any governmental agency
      or authority, other than filings which will be made with the SEC when and as
      required by law.

    
      
        
        

      

      
        14

        
        

      

      
        
        

      

    

              5.03     Title
      to Properties; Leases.  The Borrowers, the Guarantors and their
      respective Subsidiaries each has good title to all of its respective properties,
      assets and rights of every name and nature purported to be owned by
      it.

    

              5.04     Financial
      Statements.  The following financial statements have been
      furnished to the Bank:

    

                             (a)     The
      audited consolidated balance sheet of Sovran and its Subsidiaries (including,
      without limitation, SALP) as of December 31, 2006 and their related consolidated
      income statements for the fiscal year ended December 31, 2006 and the unaudited
      consolidated balance sheet of Sovran and its Subsidiaries as of June 30, 2007
      and their related consolidated income statements for the fiscal quarter then
      ended, certified by the chief financial officer of Sovran.  Such
      balance sheet and income statements have been prepared in accordance with GAAP
      and fairly present the financial condition of Sovran and its Subsidiaries as
      of
      the close of business on the dates thereof and the results of operations for
      the
      fiscal periods then ended.  There are no contingent liabilities of
      Sovran as of such dates involving material amounts, known to the officers of
      the
      Borrowers, not disclosed in said financial statements and the related notes
      thereto.

    

                             (b)     Sovran's
      Annual Report on Form 10-K for the year ended December 31, 2006 and Sovran's
      Quarterly Report on Form 10-Q for the quarter ended June 30, 2007, both filed
      with the SEC pursuant to the Securities and Exchange Act of 1934, as
      amended.

    

              5.05     Fiscal
      Year.  The Borrowers and their respective Subsidiaries each has a
      fiscal year which is the twelve months ending on December 31 of each calendar
      year.

    

              5.06     Franchises,
      Patents, Copyrights. Etc.  Each Borrower, each Guarantor and each
      of their respective Subsidiaries possesses all franchises, patents, copyrights,
      trademarks, trade names, licenses and permits, and rights in respect of the
      foregoing, adequate for the conduct of their respective businesses substantially
      as now conducted without known conflict with any rights of others.

    

              5.07     Litigation.  Except
      as stated on Schedule 5.07, there are no actions, suits, proceedings or
      investigations of any kind pending or threatened against any Borrower, any
      Guarantor or any of their respective Subsidiaries before any court, tribunal
      or
      administrative agency or board that, if adversely determined, might, either
      individually or in the aggregate, materially adversely affect the properties,
      assets, financial condition or business of such Borrower, such Guarantor or
      their respective Subsidiaries or materially impair the right of such Borrower,
      such Guarantor or their respective Subsidiaries to carry on their respective
      businesses substantially as now conducted by them, or result in any substantial
      liability not adequately covered by insurance, or for which adequate reserves
      are not maintained, as reflected in the applicable financial statements of
      the
      Borrowers, or which question the validity of this Term Loan Agreement or any
      of
      the other Loan Documents, or any action taken or to be taken pursuant hereto
      or
      thereto.

    
      
        
        

      

      
        15

        
        

      

      
        
        

      

    

              5.08     No
      Materially Adverse Contracts, Etc.  None of any Borrower, any
      Guarantor or any of their respective Subsidiaries is subject to any charter,
      corporate, partnership or other legal restriction, or any judgment, decree,
      order, rule or regulation that has or is expected in the future to have a
      materially adverse effect on their respective businesses, assets or financial
      conditions.  None of any Borrower, any Guarantor or any of their
      respective Subsidiaries is a party to any contract or agreement that has or
      is
      expected, in the judgment of their respective officers, to have any materially
      adverse effect on the respective businesses of such Borrower, such Guarantor
      or
      any of their respective Subsidiaries.

    

              5.09     Compliance
      With Other Instruments, Laws, Etc.  None of any Borrower, any
      Guarantor or any of their respective Subsidiaries is in violation of any
      provision of its partnership agreement, charter documents, bylaws or other
      organizational documents, as the case may be, or any respective agreement or
      instrument to which it may be subject or by which it or any of its properties
      may be bound or any decree, order, judgment, statute, license, rule or
      regulation, in any of the foregoing cases in a manner that could result,
      individually or in the aggregate, in the imposition of substantial penalties
      or
      materially and adversely affect the financial condition, properties or
      businesses of such Borrower, such Guarantor or any of their respective
      Subsidiaries.

    

              5.10     Tax
      Status.

    

                             (a)     Each
      of the Borrowers, the Guarantors and their respective Subsidiaries (A) has
      timely made or filed all federal, state and local income and all other tax
      returns, reports and declarations required by any jurisdiction to which it
      is
      subject, (B) has paid all taxes and other governmental assessments and charges
      shown or determined to be due on such returns, reports and declarations, except
      those being contested in good faith and by appropriate proceedings, and (C)
      has
      set aside on its books provisions reasonably adequate for the payment of all
      taxes for periods subsequent to the periods to which such returns, reports
      or
      declarations apply, and (ii) there are no unpaid taxes in any material amount
      claimed to be due by the taxing authority of any jurisdiction, and the
      respective officers of the Borrowers and the Guarantors and their respective
      Subsidiaries know of no basis for any such claim.

    

                             (b)     To
      the best of the Borrowers' knowledge, each Partially-Owned Entity (i) has
      timely made or filed all federal. state and local income and all other tax
      returns. reports and declarations required by any jurisdiction to which it
      is
      subject, (ii) has paid all taxes and other governmental assessments and charges
      shown or determined to be due on such returns, reports and declarations, except
      those being contested in good faith and by appropriate proceedings, and (iii)
      has set aside on its books provisions reasonably adequate for the payment of
      all
      taxes for periods subsequent to the periods to which such returns, reports
      or
      declarations apply.  To the best of the Borrowers' knowledge, except
      as otherwise disclosed in writing to the Bank, there are no unpaid taxes in
      any
      material amount claimed to be due by the taxing authority of any jurisdiction
      from any Partially-Owned Entity, and the officers of the Borrowers know of
      no
      basis for any such claim.

    

              5.11     No
      Event of Default: No Materially Adverse Changes.  No default,
      Default or Event of Default has occurred and is continuing.  Since
      September 30, 2005, there has occurred

    
      
        
        

      

      
        16

        
        

      

      
        
        

      

    

    no
      materially adverse change in the businesses, assets, operations, conditions
      (financial or otherwise) or prospects of Sovran and its Subsidiaries or SALP
      and
      its Subsidiaries as shown on or reflected in the consolidated balance sheet
      of
      Sovran and its Subsidiaries as at September 30, 2005, or the consolidated
      statement of income for the fiscal quarter then ended, other than changes in
      the
      ordinary course of business that have not had any materially adverse effect
      either individually or in the aggregate on the businesses, assets, operations,
      conditions (financial or otherwise) or prospects of Sovran, SALP or any of
      their
      respective Subsidiaries.

    

              5.12     Investment
      Company Act; Public Utility Holding Company Act.  None of any
      Borrower, any Guarantor or any of their respective Subsidiaries is (a) an
      "investment company", or an "affiliated company" or a "principal underwriter"
      of
      an "investment company", as such terms are defined in the Investment Company
      Act
      of 1940 or (b) a "holding company" as defined in, or subject to regulation
      under, the Public Utility Holding Company Act of 1935.

    

              5.13     Absence
      of UCC Financing Statements, Etc.  Except for Permitted Liens,
      there are no financing statement, security agreement, chattel mortgage, real
      estate mortgage, equipment lease, financing lease, option, encumbrance or other
      document filed or recorded with any filing records, registry, or other public
      office, that purports to cover, affect or give notice of any present or possible
      future lien or encumbrance on, or security interest in, any Unencumbered
      Property.  Neither any Borrower nor any Guarantor has pledged or
      granted any lien on or security interest in or otherwise encumbered or
      transferred any of their respective interests in any Subsidiary (including
      in
      the case of Sovran, its interests in SALP, and in the case of any Borrower,
      its
      interests in the Operating Subsidiaries) or in any Partially-Owned
      Entity.

    

              5.14     Absence
      of Liens.  A Borrower or a Guarantor is the owner of the
      Unencumbered Properties free from any lien, security interest, encumbrance
      and
      any other claim or demand, except for Permitted Liens.

    

              5.15     Certain
      Transactions.  Except as set forth on Schedule 5.15, none of the
      officers, partners, directors, or employees of any Borrower or any Guarantor
      or
      any of their respective Subsidiaries is presently a party to any transaction
      with any Borrower, any Guarantor or any of their respective Subsidiaries (other
      than for services as employees, officers and directors), including any contract,
      agreement or other arrangement providing for the furnishing of services to
      or
      by, providing for rental of real or personal property to or from, or otherwise
      requiring payments to or from any officer, partner, director or such employee
      or, to the knowledge of the Borrowers, any corporation, partnership, trust
      or
      other entity in which any officer, partner, director, or any such employee
      or
      natural Person related to such officer, partner, director or employee or other
      Person in which such officer, partner, director or employee has a direct or
      indirect beneficial interest has a substantial interest or is an officer,
      director, trustee or partner.

    

              5.16     Employee
      Benefit Plans.

    

                             (a)     In
      General.  Each Employee Benefit Plan and each Guaranteed Pension
      Plan has been maintained and operated in compliance in all material respects
      with the provisions of ERISA and, to the extent applicable, the Code, including
      but not limited to the provisions thereunder respecting prohibited transactions
      and the bonding of fiduciaries and other persons

    
      
        
        

      

      
        17

        
        

      

      
        
        

      

    

    handling
      plan funds as required by §412 of ERISA.  The Borrowers have
      heretofore delivered to the Administrative Agent the most recently completed
      annual report, Form 5500, with all required attachments, and actuarial statement
      required to be submitted under §103(d) of ERISA, with respect to each Guaranteed
      Pension Plan.

    

                             (b)     Terminability
      of Welfare Plans.  No Employee Benefit Plan, which is an employee
      welfare benefit plan within the meaning of §3(1) or §3(2)(B) of ERISA, provides
      benefit coverage subsequent to termination of employment, except as required
      by
      Title I, Part 6 of ERISA or the applicable state insurance laws.  The
      Borrowers may terminate each such Plan at any time (or at any time subsequent
      to
      the expiration of any applicable bargaining agreement) in the discretion of
      the
      Borrowers without liability to any Person other than for claims arising prior
      to
      termination.

    

                             (c)     Guaranteed
      Pension Plans.  Each contribution required to be made to a
      Guaranteed Pension Plan, whether required to be made to avoid the incurrence
      of
      an accumulated funding deficiency, the notice or lien provisions of §302(f) of
      ERISA, or otherwise, has been timely made. No waiver of an accumulated funding
      deficiency or extension of amortization periods has been received with respect
      to any Guaranteed Pension Plan, and neither any Borrower or any Guarantor nor
      any ERISA Affiliate is obligated to or has posted security in connection with
      an
      amendment to a Guaranteed Pension Plan pursuant to §307 of ERISA or §401(a)(29)
      of the Code.  No liability to the PBGC (other than required insurance
      premiums, all of which have been paid) has been incurred by any Borrower or
      any
      Guarantor or any ERISA Affiliate with respect to any Guaranteed Pension Plan
      and
      there has not been any ERISA Reportable Event (other than an ERISA Reportable
      Event as to which the requirement of thirty (30) days notice has been waived),
      or any other event or condition which presents a material risk of termination
      of
      any Guaranteed Pension Plan by the PBGC.  Based on the latest
      valuation of each Guaranteed Pension Plan (which in each case occurred within
      twelve months of the date of this representation), and on the actuarial methods
      and assumptions employed for that valuation, the aggregate benefit liabilities
      of all such Guaranteed Pension Plans within the meaning of §4001 of ERISA did
      not exceed the aggregate value of the assets of all such Guaranteed Pension
      Plans, disregarding for this purpose the benefit liabilities and assets of
      any
      Guaranteed Pension Plan with assets in excess of benefit liabilities, by more
      than $500,000.

    

                             (d)     Multiemployer
      Plans.  Neither any Borrower nor any Guarantor nor any ERISA
      Affiliate has incurred any material liability (including secondary liability)
      to
      any Multiemployer Plan as a result of a complete or partial withdrawal from
      such
      Multiemployer Plan under §4201 of ERISA or as a result of a sale of assets
      described in §4204 of ERISA.  Neither any Borrower nor any Guarantor
      nor any ERISA Affiliate has been notified that any Multiemployer Plan is in
      reorganization or insolvent under and within the meaning of §4241 or §4245 of
      ERISA or is at risk of entering reorganization or becoming insolvent, or that
      any Multiemployer Plan intends to terminate or has been terminated under §4041A
      of ERISA.

    

              5.17     Regulations
      U and X.  The proceeds of the Loans shall be used for the purposes
      described in Section 3.03.  No portion of any Loan is to be used, and
      no portion of any Letter of Credit is to be obtained, for the purpose of
      purchasing or carrying any "margin security" or

    
      
        
        

      

      
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    "margin
      stock" in violation of (and, as such terms are used in) Regulations U and X
      of
      the Board of Governors of the Federal Reserve System, 12 C.F.R. Parts 221 and
      224.

    

              5.18     Environmental
      Compliance.  The Borrowers have caused environmental assessments
      to be conducted and/or taken other steps to investigate the past and present
      environmental condition and usage of the Real state and the operations conducted
      thereon.  Based upon such assessments and/or investigation, the
      Borrowers represent and warrant that:

    

                             (a)     None
      of any Borrower, any Guarantor, any of their respective Subsidiaries or any
      operator of the Real Estate or any portion thereof, or any operations thereon
      is
      in violation, or alleged violation, of any judgment, decree, order, law,
      license, rule or regulation pertaining to environmental matters, including
      without limitation, those arising under the Resource Conservation and Recovery
      Act ("RCRA"), the Comprehensive Environmental Response, Compensation and
      Liability Act of 1980 as amended ("CERCLA"), the Superfund Amendments and
      Reauthorization Act of 1986 ("SARA"), the Federal Clean Water Act, the Federal
      Clean Air Act, the Toxic Substances Control Act, or any state or local statute,
      regulation, ordinance, order or decree relating to health, safety or the
      environment (hereinafter "Environmental Laws"), which violation or alleged
      violation has, or its remediation would have, by itself or when aggregated
      with
      all such other violations or alleged violations, a material adverse effect
      on
      the environment or the business, assets or financial condition of any Borrower,
      any Guarantor or any of their respective Subsidiaries, or constitutes a
      Disqualifying Environmental Event with respect to any Unencumbered
      Property.

    

                             (b)     None
      of any Borrower, any Guarantor or any of their respective Subsidiaries has
      received notice from any third party, including, without limitation, any
      federal, state or local governmental authority, (i) that it has been identified
      by the United States Environmental Protection Agency ("EPA") as a potentially
      responsible party under CERCLA with respect to a site listed on the National
      Priorities List, 40 C.F.R. Part 300 Appendix B (1986), (ii) that any hazardous
      waste, as defined by 42 U.S.C. §6903(5), any hazardous substances as defined by
      42 U.S.C. §9601(14), any pollutant or contaminant as defined by 42 U.S.C.
§9601(33) or any toxic substances, oil or hazardous materials or other chemicals
      or substances regulated by any Environmental Laws ("Hazardous Substances")
      which
      it has generated, transported or disposed of has been found at any site at
      which
      a federal, state or local agency or other third party has conducted or has
      ordered that any Borrower, any Guarantor or any of their respective Subsidiaries
      conduct a remedial investigation, removal or other response action pursuant
      to
      any Environmental Law, or (iii) that it is or shall be a named party to any
      claim, action, cause of action, complaint, or legal or administrative proceeding
      (in each case, contingent or otherwise) arising out of any third party's
      incurrence of costs, expenses, losses or damages of any kind whatsoever in
      connection with the release of Hazardous Substances; which event described
      in
      any such notice would have a material adverse effect on the business, assets
      or
      fmancial condition of any Borrower, any Guarantor or any of their respective
      Subsidiaries, or constitutes a Disqualifying Environmental Event with respect
      to
      any Unencumbered Property.

    

                             (c)     None
      of the Borrowers. the Guarantors or the Real Estate is subject to any applicable
      Environmental Law requiring the performance of Hazardous Substances site
      assessments, or the removal or remediation of Hazardous Substances, or the
      giving of notice to

    
      
        
        

      

      
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    any
      governmental agency or the recording or delivery to other Persons of an
      environmental disclosure document or statement, by virtue of the transactions
      set forth herein and contemplated hereby, or as a condition to the effectiveness
      of any other transactions contemplated hereby.

    

              5.19     Subsidiaries.  Schedule
      5.19 sets forth all of the respective Subsidiaries of Sovran or SALP, and
      Schedule 5.19 will be updated to reflect any subsequent Guarantor and its
      Subsidiaries, if any.

    

              5.20     Loan
      Documents.  All of the representations and warranties of the
      Borrowers and the Guarantors made in this Term Loan Agreement and in the other
      Loan Documents or any document or instrument delivered to the Bank pursuant
      to
      or in connection with any of such Loan Documents are true and correct in all
      material respects and do not include any untrue statement of a material fact
      or
      omit to state a material fact required to be stated or necessary to make such
      representations and warranties not materially misleading.

    

              5.21     REIT
      Status.  Sovran has not taken any action that would prevent it
      from maintaining its qualification as a REIT for its tax year ended December
      31,2006, or from maintaining such qualification at all times during the term
      of
      the Loans. Sovran is not a "pension held REIT" within the meaning of
§856(h)(3)(D) of the Code.

    

    ARTICLE
      6. Covenants of the Borrowers and the Guarantors.

    

              Each
      of the Borrowers for itself and on behalf of each of the Guarantors (if and
      to
      the extent expressly included in Subsections contained in this Section)
      covenants and agrees that, so long as any Indebtedness arising under this
      Agreement or the Term Loan Note is outstanding or the Bank has any obligation
      to
      make any Term Loans:

    

              6.01     Punctual
      Payment.  The Borrowers will duly and punctually pay or cause to
      be paid the principal and interest on the Term Loans and all interest, fees,
      charges and other amounts provided for in this Term Loan Agreement and the
      other
      Loan Documents, all in accordance with the terms of this Term Loan Agreement
      and
      the Term Loan Note, and the other Loan Documents.

    

              6.02     Maintenance
      of Office.  Each of the Borrowers and the Guarantors will maintain
      its chief executive office in Buffalo, New York, or at such other place in
      the
      contiguous United States of America as each of them shall designate upon written
      notice to the Bank to be delivered within five (5) days of such change, where
      notices, presentations and demands to or upon the Borrowers and the Guarantors,
      as the case may be, in respect of the Loan Documents may be given or
      made.

    

              6.03     Records
      and Accounts.  Each of the Borrowers and the Guarantors will (a)
      keep, and cause each of its Subsidiaries to keep, true and accurate records
      and
      books of account in which full, true and correct entries will be made in
      accordance with GAAP, (b) maintain adequate accounts and reserves for all taxes
      (including income taxes), contingencies, depreciation and amortization of its
      properties and the properties of its Subsidiaries and (c) at all times engage
      Ernst & Young LLP o; other accountants reasonably acceptable to the Bank as
      the

    
      
        
        

      

      
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    independent
      certified public accountants of Sovran, SALP and their respective Subsidiaries
      and will not permit more than thirty (30) days to elapse between the cessation
      of such firm's (or any successor firm's) engagement as the independent certified
      public accountants of Sovran, SALP and their respective Subsidiaries and the
      appointment in such capacity of a successor firm as Accountants.

    

              6.04     Financial
      Statements, Certificates and Information.  The Borrowers will
      deliver to the Bank true and correct copies of financial statements,
      certificates and information required to be delivered to the Administrative
      Agent under the terms of Section 8.4 of the Credit Agreement within the time
      periods or by the dates specified therein.

    

              6.05     Notices.

    

                             (a)     Defaults.  Each
      Borrower will, and will cause each Guarantor, as applicable, to, promptly notify
      the Bank in writing of the occurrence of any default, Default or Event of
      Default. If any Person shall give any notice or take any other action in respect
      of (x) a claimed default (whether or not constituting a Default or an Event
      of
      Default) under this Term Loan Agreement or (y) a claimed default by any
      Borrower, any Guarantor or any of their respective Subsidiaries, as applicable,
      under any note, evidence of Indebtedness, indenture or other obligation to
      which
      or with respect to which any of them is a party or obligor, whether as
      principal, guarantor or surety, and such default would permit the holder of
      such
      note or obligation or other evidence of Indebtedness to accelerate the maturity
      thereof or otherwise cause the entire Indebtedness to become due, such Borrower
      or such Guarantor, as the case may be, shall forthwith give written notice
      thereof to the Bank, describing the notice or action and the nature of the
      claimed failure to comply.

    

                             (b)     Environmental
      Events.  Each Borrower will, and will cause each Guarantor to,
      promptly give notice in writing to the Bank (i) upon such Borrower's or such
      Guarantor's obtaining knowledge of any material violation of any Environmental
      Law regarding any Real Estate or such Borrower's or such Guarantor's operations
      or the operations of any of their Subsidiaries, (ii) upon such Borrower's or
      such Guarantor's obtaining knowledge of any known Release of any Hazardous
      Substance at, from, or into any Real Estate which it reports in writing or
      is
      reportable by it in writing to any governmental authority and which is material
      in amount or nature or which could materially affect the value of such Real
      Estate, (iii) upon such Borrower's or such Guarantor's receipt of any notice
      of
      material violation of any Environmental Laws or of any material Release of
      Hazardous Substances in violation of any Environmental Laws or any matter that
      may be a Disqualifying Environmental Event, including a notice or claim of
      liability or potential responsibility from any third party (including without
      limitation any federal, state or local governmental officials) and including
      notice of any formal inquiry, proceeding, demand, investigation or other action
      with regard to (A) such Borrower's or such Guarantor's or any other Person's
      operation of any Real Estate, (B) contamination on, from or into any Real
      Estate, or (C) investigation or remediation of off-site locations at which
      such Borrower or such Guarantor or any of its predecessors are alleged to have
      directly or indirectly disposed of Hazardous Substances, or (iv) upon such
      Borrower's or such Guarantor's obtaining knowledge that any expense or loss
      has
      been incurred by such governmental authority in connection with the assessment,
      containment, removal or remediation of any Hazardous Substances with respect
      to

    
      
        
        

      

      
        21

        
        

      

      
        
        

      

    

    which
      such Borrower or such Guarantor or any Partially-Owned Entity may be liable
      or
      for which a lien may be imposed on any Real Estate; any of which events
      described in clauses (i) through (iv) above would have a material adverse
      effect on the business, assets or financial condition of any Borrower, any
      Guarantor or any of their respective Subsidiaries, or constitutes a
      Disqualifying Environmental Event with respect to any Unencumbered
      Property.

    

                             (c)     Notification
      of Claims against Unencumbered Properties.  Each Borrower will,
      and will cause each Guarantor to, promptly upon becoming aware thereof, notify
      the Bank in writing of any setoff, claims, withholding or other defenses to
      which any of the Unencumbered Properties are subject, which (i) would have
      a
      material adverse effect on (x) the business, assets or financial condition
      of
      any Borrower, any Guarantor or any of their respective Subsidiaries, or (y)
      the
      value of such Unencumbered Property, or (ii) with respect to such Unencumbered
      Property, constitute a Disqualifying Environmental Event, a Disqualifying Legal
      Event, a Disqualifying Building Event or a Lien which is not a Permitted
      Lien.

    

                             (d)     Notice
      of Litigation and Judgments.  Each Borrower will, and will cause
      each Guarantor to. and the Borrowers will cause each of their respective
      Subsidiaries to. give notice to the Bank in writing within ten (10) days of
      becoming aware of any litigation or proceedings threatened in writing or any
      pending litigation and proceedings an adverse determination in which could
      materially affect any Borrower, any Guarantor or any of their respective
      Subsidiaries or any Unencumbered Property or to which any Borrower, any
      Guarantor or any of their respective Subsidiaries is or is to become a party
      involving an uninsured claim against any Borrower, any Guarantor or any of
      their
      respective Subsidiaries that could reasonably be expected to have a materially
      adverse effect on such Borrower or such Guarantor or their respective
      properties, business, assets, financial condition or prospects or on the value
      or operation of the Unencumbered Properties and stating the nature and status
      of
      such litigation or proceedings.  Each Borrower will, and will cause
      each of the Guarantors and the Subsidiaries to, give notice to the Bank, in
      writing, in form and detail reasonably satisfactory to the Bank, within ten
      (10)
      days of any judgment not covered by insurance, final or otherwise, against
      any
      Borrower, any Guarantor or any of their Subsidiaries in an amount in excess
      of
      $100,000.

    

              6.06     Existence
      of SALP, Holdings and Subsidiary Guarantors; Maintenance of

    Properties.  SALP
      for itself and for Holdings and each Subsidiary Guarantor (insofar as any such
      statements relate to Holdings or such Subsidiary Guarantor) will do or cause
      to
      be done all things necessary to, and shall, preserve and keep in full force
      and
      effect its existence as a limited partnership, corporation or another legally
      constituted entity, and will do or cause to be done all things necessary to
      preserve and keep in full force all of its rights and franchises and those
      of
      its Subsidiaries, and will not, and will not cause or permit any of its
      Subsidiaries to, convert to a limited liability company or a limited liability
      partnership. SALP shall be the owner of substantially all of the Real Estate
      owned by the Borrowers and their respective Subsidiaries and shall not permit
      any Subsidiary of any Borrower to own any Real Estate without the prior written
      consent of the Bank, and then only in specific circumstances outside of the
      ordinary course of business.  In any such case, such Subsidiary shall
      be wholly-owned by Sovran or SALP and shall become a Subsidiary Guarantor.
      SALP
      (a) will cause all necessary repairs, renewals, replacements, betterments and
      improvements to be made to all Real Estate owned or controlled by it or by
      any
      of its Subsidiaries or any Subsidiary Guarantor, all as in the judgment of
      SALP
      or

    
      
        
        

      

      
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    such
      Subsidiary or such Subsidiary Guarantor may be necessary so that the business
      carried on in connection therewith may be properly conducted at all times,
      subject to the terms of the applicable Leases and partnership agreements or
      other entity charter documents, (b) will cause all of its other properties
      and
      those of its Subsidiaries and the Subsidiary Guarantors used or useful in the
      conduct of its business or the business of its Subsidiaries or such Subsidiary
      Guarantor to be maintained and kept in good condition, repair and working order
      and supplied with all necessary equipment, and (c) will, and will cause each
      of
      its Subsidiaries and each Subsidiary Guarantor to, continue to engage
      exclusively in the business of owning and operating self storage facilities,
      which self storage facilities shall be known primarily as "Uncle BOB'S Self
      Storage"; provided that nothing in this Term Loan Agreement shall prevent
      the Borrowers from entering into Tower Leases or occasional non-material Leases
      of retail or office space incidental to the Borrowers' owning and operating
      self
      storage facilities; and providedfurther that nothing in this
      Section 6.06 shall prevent any Borrower from discontinuing the operation and
      maintenance of any of its properties or any of those of its Subsidiaries if
      such
      discontinuance is, in the judgment of SALP, desirable in the conduct of its
      or
      their business and such discontinuance does not cause a Default or an Event
      of
      Default hereunder and does not in the aggregate materially adversely affect
      the
      business of the Borrowers and their respective Subsidiaries on a consolidated
      basis.  Holdings shall at all times he a wholly-owned Subsidiary of
      Sovran and the sole general partner of SALP and shall be the owner of at least
      1% of the outstanding partnership interests in SALP.

    

              6.07     Existence
      of Sovran; Maintenance of REIT Status of Sovran; Maintenance of
      Properties.  Sovran will do or cause to be done all things
      necessary to preserve and keep in full force and effect its existence as a
      Maryland corporation. Sovran will at all times maintain its status as a REIT
      and
      not to take any action which could lead to its disqualification as a
      REIT.  Sovran shall at all times maintain its listing on the New York
      Stock Exchange. Sovran will continue to operate as a fully-integrated,
      self-administered and self-managed real estate investment trust which, together
      with its Subsidiaries (including, without limitation SALP) owns and operates
      an
      improved property portfolio comprised exclusively of self-storage
      facilities.  Sovran will not engage in any business other than the
      business of acting as a REIT and serving as a limited partner of SALP and as
      a
      member, partner or stockholder of other Persons as permitted by this Term Loan
      Agreement.  Sovran shall conduct all or substantially all of its
      business operations through SALP, and shall not own real estate assets outside
      of its interests in SAW.  Sovran shall cause SALP to own substantially
      all of the Real Estate owned by the Borrowers and their respective Subsidiaries
      and shall not permit any Subsidiary of any Borrower to become the owner of
      any
      Real Estate without the prior written consent of the Bank, and then only in
      specific circumstances outside of the ordinary course of business.  In
      any such case, such Subsidiary shall be wholly-owned by Sovran or SALP and
      shall
      become a Subsidiary Guarantor.  Sovran shall do or cause to be done
      all things necessary to preserve and keep in full force all of its rights and
      franchises and those of its Subsidiaries.  Sovran shall (a) cause all
      of its properties and those of its Subsidiaries used or useful in the conduct
      of
      its business or the business of its Subsidiaries to be maintained and kept
      in
      good condition, repair and working order and supplied with all necessary
      equipment, (b) cause to be made all necessary repairs, renewals, replacements,
      betterments and improvements thereof, all as in the judgment of Sovran may
      be
      necessary so that the business carried on in connection therewith may be
      properly and advantageously conducted at all times, and (c) cause SALP and
      each
      of its Subsidiaries to continue to engage exclusively in

    
      
        
        

      

      
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    the
      business of owning and operating self storage facilities, which self-storage
      facilities shall be known primarily as "Uncle BOB'S Self Storage"; provided
      that
      nothing in this Section 6.07 shall prevent Sovran from discontinuing the
      operation and maintenance of any of its properties or any of those of its
      Subsidiaries if such discontinuance is, in the judgment of Sovran, desirable
      in
      the conduct of its or their business and such discontinuance does not cause
      a
      Default or an Event of Default hereunder and does not in the aggregate
      materially adversely affect the business of Sovran and its Subsidiaries on
      a
      consolidated basis.

    

              6.08     Insurance.  Each
      Borrower will, and will cause each Guarantor to, maintain with respect to its
      properties, and will cause each of its Subsidiaries to maintain with financially
      sound and reputable insurers, insurance with respect to such properties and
      its
      business against such casualties and contingencies as shall be in accordance
      with the general practices of businesses having similar operations and real
      estate portfolios in similar geographic areas and in amounts, containing such
      terms, in such forms and for such periods as may be reasonable and
      prudent.

    

              6.09     Taxes.  Each
      Borrower will, and will cause each Guarantor to, pay or cause to be paid real
      estate taxes, other taxes, assessments and other governmental charges against
      the Real Estate before the same become delinquent and will duly pay and
      discharge, or cause to be paid and discharged, before the same shall become
      overdue, all taxes, assessments and other governmental charges imposed upon
      its
      sales and activities, or any part thereof, or upon the income or profits
      therefrom, as well as all claims for labor, materials, or supplies that if
      unpaid might by law become a lien or charge upon any of the Real Estate;
      provided that any such tax, assessment, charge, levy or claim need not be paid
      if the validity or amount thereof shall currently be contested in good faith
      by
      appropriate proceedings and if such Borrower or such Guarantor shall have set
      aside on its books adequate reserves with respect thereto; and provided further
      that such Borrower or such Guarantor will pay all such taxes, assessments,
      charges, levies or claims forthwith upon the commencement of proceedings to
      foreclose any lien that may have attached as security therefor.  If
      requested by the Bank, the Borrowers will provide evidence of the payment of
      real estate taxes, other taxes, assessments and other governmental charges
      against the Real Estate in the form of receipted tax bills or other form
      reasonably acceptable to the Bank.

    

              6.10     Inspection
      of Properties and Books.  Each Borrower will, and will cause each
      Guarantor to, permit the Bank to visit and inspect any of the properties of
      any
      Borrower, any Guarantor or any of their respective Subsidiaries, to examine
      the
      books of account of the Borrowers, the Guarantors and their respective
      Subsidiaries (and to make copies thereof and extracts therefrom) and to discuss
      the affairs, finances and accounts of the Borrowers, the Guarantors and their
      respective Subsidiaries with, and to be advised as to the same by, its officers,
      all at such reasonable times and intervals as the Bank may reasonably request;
      provided that the Borrowers shall only be responsible for the costs and
      expenses incurred by the Bank in connection with such inspections after the
      occurrence and during the continuance of an Event of Default.  The
      Bank agrees to keep any non-public information delivered or made available
      by
      the Borrowers to it confidential from anyone other than persons employed or
      retained by the Bank (including, without limitation, employees, officers,
      attorneys and other advisors) who, in the reasonable determination of the Bank,
      reasonably need to know such information and who are or are expected to become
      engaged in evaluating, approving, structuring or administering the Term Loans
      or
      rendering legal advice in connection with the Term Loans; provided such
      employees,

    
      
        
        

      

      
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    officers,
      attorneys and other advisors agree to keep such information confidential in
      accordance with this Section 6.10; and provided further that nothing herein
      shall prevent the Bank or persons employed or retained by the Bank from
      disclosing such information (i) to any other person if reasonably incidental
      to
      the administration of the Term Loans, (ii) upon the order of any court or
      administrative agency, (iii) upon the request or demand of any regulatory agency
      or authority, (iv) which has been publicly disclosed other than as a result
      of a
      disclosure by the Bank which is not permitted by this Term Loan Agreement,
      (v)
      in connection with any litigation to which the Bank, or their respective
      Affiliates may be a party, (vi) to the extent reasonably required in connection
      with the exercise of any remedy hereunder, (vii) to the Bank, legal counsel
      and
      independent auditors, and (viii) as otherwise required by law. Notwithstanding
      anything herein to the contrary, the Bank may disclose to any and all Persons,
      without limitation of any kind, any information with respect to "tax treatment"
      and "tax structure" (in each case, within the meaning of Treasury Regulation
      §1.6011.4) of the transactions contemplated hereby and all materials of any
      kind
      (including opinions or other tax analyses) that are provided to the Bank
      relating to such tax treatment and tax structure.

    

              6.11     Compliance
      with Laws.  Contracts, Licenses. and Permits. Each Borrower will,
      and will cause each Guarantor to, comply with, and will cause each of their
      respective Subsidiaries to comply with (a) all applicable laws and regulations
      now or hereafter in effect wherever its business is conducted, including,
      without limitation, all Environmental Laws and all applicable federal and state
      securities laws, (b) the provisions of its partnership agreement and certificate
      or corporate charter and other charter documents and by-laws, as applicable,
      (c)
      all material agreements and instruments to which it is a party or by which
      it or
      any of its properties may be bound (including the Real Estate and the Leases)
      and (d) all applicable decrees, orders, and judgments.  If at any time
      while any Term Loan is outstanding or the Bank has any obligation to make Term
      Loans hereunder, any permit shall become necessary or required in order that
      any
      Borrower may fulfill any of its obligations hereunder, the Borrowers and the
      Guarantors will immediately take or cause to be taken all reasonable steps
      within the power of the Borrowers or the Guarantors, as applicable, to obtain
      such permit and furnish the Bank with evidence thereof.

    

              6.12     Use
      of Proceeds.  Subject at all times to the other provisions of this
      Term Loan Agreement, the Borrowers will use the proceeds of the Term Loans
      solely to finance the acquisition of Real Estate.

    

              6.13     Acquisition
      of Unencumbered Properties.  The Borrowers shall, within seven (7)
      Business Days of the acquisition of an Unencumbered Property or the
      qualification of any Real Estate as an Unencumbered Property, deliver to the
      Bank a certificate from an officer of the Borrower Representative certifying
      that such Real Estate satisfies the requirements for an Unencumbered Property
      set forth in the definition thereof.

    

              6.14     Solvency
      of Guarantor.  The Borrowers shall cause the Subsidiary Guarantor
      to remain solvent and shall provide each Subsidiary Guarantor with such funds
      and assets as such Subsidiary Guarantor shall require in the operation of its
      business, all in consideration of such Guarantor's execution and delivery of
      its
      Guaranty.

    
      
        
        

      

      
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              6.15     Further
      Assurances.  Each Borrower will, and will cause each Guarantor to,
      cooperate with, and to cause each of its Subsidiaries to cooperate with, the
      Bank and execute such further instruments and documents as the Bank shall
      reasonably request to carry out to their satisfaction the transactions
      contemplated by this Term Loan Agreement and the other Loan
      Documents.

    

              6.16     Environmental
      Indemnification.  The Borrowers jointly and severally covenant and
      agree that they will indemnify and hold the Bank, and each of its Affiliates,
      harmless from and against any and all claims, expense, damage, loss or liability
      incurred by the Bank (including all reasonable costs of legal representation
      incurred by the Bank, but excluding, as applicable, for the Bank any claim,
      expense, damage, loss or liability as a result of the gross negligence or
      willful misconduct of the Bank or any of its respective Affiliates) relating
      to
      (a) any Release or threatened Release of Hazardous Substances on any Real
      Estate; (b) any violation of any Environmental Laws with respect to conditions
      at any Real Estate or the operations conducted thereon; (c) the investigation
      or
      remediation of off-site locations at which any Borrower, any Guarantor or any
      of
      their respective Subsidiaries or their predecessors are alleged to have directly
      or indirectly disposed of Hazardous Substances; or (d) any action, suit,
      proceeding or investigation brought or threatened with respect to any Hazardous
      Substances relating to Real Estate (including, but not limited to, claims with
      respect to wrongful death, personal injury or damage to property).  It
      is expressly acknowledged by each Borrower that this covenant of indemnification
      shall survive the payment of the Term Loans and shall inure to the benefit
      of
      the Bank and its respective Affiliates, their respective successors, and their
      respective assigns under the Loan Documents permitted under this Term Loan
      Agreement.

    

              6.17     Response
      Actions.  Each Borrower covenants and agrees that if any Release
      or disposal of Hazardous Substances shall occur or shall have occurred on any
      Real Estate owned by it or any of its Subsidiaries, such Borrower will cause
      the
      prompt containment and removal of such Hazardous Substances and remediation
      of
      such Real Estate as necessary to comply with all Environmental Laws or to
      preserve the value of such Real Estate.

    

              6.18     Environmental
      Assessments.  If the Bank has reasonable grounds to believe that a
      Disqualifying Environmental Event has occurred with respect to any Unencumbered
      Property, after reasonable notice by the Bank, whether or not a Default or
      an
      Event of Default shall have occurred, the Bank may determine that the affected
      Real Estate no longer qualifies as an Unencumbered Property; provided that
      prior
      to making such determination, the Bank shall give the Borrower Representative
      reasonable notice and the opportunity to obtain one or more environmental
      assessments or audits of such Unencumbered Property prepared by a
      hydrogeologist, an independent engineer or other qualified consultant or expert
      approved by the Bank, which approval will not be unreasonably withheld, to
      evaluate or confirm (i) whether any Release of Hazardous Substances has occurred
      in the soil or water at such Unencumbered Property and (ii) whether the use
      and
      operation of such Unencumbered Property materially complies with all
      Environmental Laws (including not being subject to a matter that is a
      Disqualifying Environmental Event). Such assessment will then be used by the
      Bank to determine whether a Disqualifying Environmental Event has in fact
      occurred with respect to such Unencumbered Property.  All such
      environmental assessments shall be at the sole cost and expense of the
      Borrowers.

    
      
        
        

      

      
        26

        
        

      

      
        
        

      

    

    

              6.19     Employee
      Benefit Plans.

    

                             (a)     In
      General.  Each Employee Benefit Plan maintained by any Borrower,
      any Guarantor or any of their respective ERISA Affiliates will be operated
      in
      compliance in all material respects with the provisions of ERISA and, to the
      extent applicable, the Code, including but not limited to the provisions
      thereunder respecting prohibited transactions.

    

                             (b)     Terminability
      of Welfare Plans.  With respect to each Employee Benefit Plan
      maintained by any Borrower, any Guarantor or any of their respective ERISA
      Affiliates which is an employee welfare benefit plan within the meaning of
§3(1)
      or §3(2)(B) of ERISA, such Borrower, such Guarantor, or any of their respective
      ERISA Affiliates, as the case may be, has the right to terminate each such
      plan
      at any time (or at any time subsequent to the expiration of any applicable
      bargaining agreement) without liability other than liability to pay claims
      incurred prior to the date of termination.

    

                             (c)     Unfunded
      or Underfunded Liabilities.  The Borrowers will not, and will not
      permit any Guarantor to, at any time, have accruing or accrued unfunded or
      underfunded liabilities with respect to any Employee Benefit Plan, Guaranteed
      Pension Plan or Multiemployer Plan, or permit any condition to exist under
      any
      Multiemployer Plan that would create a withdrawal liability.

    

              6.20     No
      Amendments to Certain Documents.  The Borrowers will not, and will
      not permit any Guarantor to, at any time cause or permit its certificate of
      limited partnership, agreement of limited partnership, articles of
      incorporation, by-laws or other charter documents, as the case may be, to be
      modified, amended or supplemented in any respect whatever, without (in each
      case) the express prior written consent or approval of the Bank in its sole
      discretion, if such changes would affect Sovran's REIT status or otherwise
      materially adversely affect the rights of the Bank hereunder or under any other
      Loan Document.

    

              6.21     Compliance
      with Negative Covenants in The Credit Agreement.  The Borrowers
      will comply in all respects with (a) each of the covenants contained in Section
      9 of the Credit Agreement, and (b) each of the financial covenants contained
      in
      Section 10 of the Credit Agreement.

    

    ARTICLE
      7. Conditions to the Initial Advance of the Term Loan.

    

    The
      obligations of the Bank to advance the initial Term Loan shall be subject to
      the
      satisfaction of the following conditions precedent:

    

              7.01     Loan
      Documents.  Each of the Loan Documents shall have been duly
      executed and delivered by the respective parties thereto and shall be in full
      force and effect.

    

              7.02     Certified
      Copies of Organization Documents.  The Bank shall have received
      from each Borrower and Holdings a copy, certified by a duly authorized officer
      of such Person (or its general partner, in the case of SALP), to be true and
      complete, of each of its certificate of limited

    
      
        
        

      

      
        27

        
        

      

      
        
        

      

    

    partnership,
      agreement of limited partnership, incorporation documents, by-laws, and/or
      other
      organizational documents as in effect along with any other organization
      documents of any Borrower
      (and its general partner, in the case of SALP) or Holdings, as the case may
      be,
      and each as in effect on the date of such certification.

    

              7.03     By-laws;
      Resolutions.  All action on the part of the Borrowers and Holdings
      necessary for the valid execution, delivery and performance by the Borrowers
      and
      Holdings of this Term Loan Agreement and the other Loan Documents to which
      either of them is or is to become a party shall have been duly and effectively
      taken, and satisfactory evidence thereof shall have been provided to the
      Bank.  Without limiting the foregoing, the Bank shall have received
      from Holdings true copies of its by-laws and the resolutions adopted by its
      board of directors authorizing the transactions described herein and evidencing
      the due authorization, execution and delivery of the Loan Documents to which
      SALP and Holdings are a party, each certified by the secretary as of a recent
      date to be true and complete.

    

              7.04     Incumbency
      Certificate; Authorized Signers.  The Bank shall have received
      from each of the Borrowers and Holdings an incumbency certificate, dated as
      of
      the Closing Date, signed by a duly authorized officer such Person and giving
      the-name of each individual who shall be authorized: (a) to sign, in the name
      and on behalf of such Person, each of the Loan Documents to which such Person
      is
      or is to become a party; (b) in the case of the Borrower Representative, to
      make
      Loan Requests on behalf of the Borrowers; and (c) in the case of the Borrower
      Representative, to give notices and to take other action on behalf of the
      Borrowers and the Guarantors under the Loan Documents.

    

              7.05     Certificates
      of Insurance.  The Bank shall have received (a) current
      certificates of insurance as to all of the insurance maintained by each Borrower
      and their respective Subsidiaries on the Real Estate (including flood insurance
      if necessary) from the insurer or an independent insurance broker, identifying
      insurers, types of insurance, insurance limits, and policy terms; and (b) such
      further information and certificates from the Borrowers, their insurers and
      insurance brokers as the Bank may reasonably request.

    

              7.06     Opinion
      of Counsel Concerning Organization and Loan Documents.  The Bank
      shall have received favorable opinions addressed to the Bank in form and
      substance satisfactory to the Bank from Phillips Lytle LLP, as counsel to the
      Borrowers and their respective Subsidiaries with respect to New York law and
      certain matters of Delaware corporate law and Maryland corporate
      law.

    

              7.07     Tax
      and Securities Law Compliance.  The Bank shall also have received
      from Phillips Lytle LLP, as counsel to the Borrowers, a favorable opinion
      addressed to the Bank, in form and substance satisfactory to the Bank, with
      respect to the qualification of Sovran as a REIT and certain other tax and
      securities laws matters.

    

              7.08     Guaranties.  Each
      of the Guaranties to be executed and delivered on the Closing Date shall have
      been duly executed and delivered by the Guarantor thereunder.

    
      
        
        

      

      
        28

        
        

      

      
        
        

      

    

              7.09     UCC-11
      Reports.  The Bank shall have received UCC-11 search results from
      the appropriate jurisdictions for each Borrower and the Guarantor.

    

              7.10     Proceedings
      and Documents.  All proceedings in connection with the
      transactions contemplated by this Term Loan Agreement, the other Loan Documents
      and all other documents incident thereto shall be satisfactory in form and
      substance to the Bank and the Bank shall have received all information and
      such
      counterpart originals or certified or other copies of such documents as the
      Bank
      may reasonably request.

    

              7.11     Fees.  The
      Borrowers shall have paid to the Bank all of the fees and expenses that are
      due
      and payable as of the Closing Date in accordance with this Term Loan
      Agreement.

    

              7.12     Compliance
      Certificate.  The Borrowers shall have delivered a compliance
      certificate in the form of Exhibit C hereto evidencing continued compliance
      with
      the terms of this Agreement and the Credit Agreement.

    

              7.13     Subsequent
      Guarantors.  As a condition to the effectiveness of any subsequent
      Guaranty, each subsequent Guarantor shall deliver such documents, agreements,
      instruments and opinions as the Bank shall require as to such Guarantor and
      the
      unencumbered Property owned by such Guarantor that are analogous to the
      deliveries made by the Guarantors as of the Closing Date pursuant to Section
      7.02 through Section 7.04.

    

    ARTICLE
      8. Conditions to all Advances of the Term Loans

    

              The
      obligations of the Bank to make the additional Term Loans shall also be subject
      to the satisfaction of the following conditions precedent:

    

              8.01     Representations
      True; No Event of Default; Compliance Certificate.  Each of the
      representations and warranties of the Borrowers and the Guarantors contained
      in
      this Term Loan Agreement, the other Loan Documents or in any document or
      instrument delivered pursuant to or in connection with this Term Loan Agreement
      shall be true as of the date as of which they were made and shall also be true
      at and as of the time of the making of each Term Loan with the same effect
      as if
      made at and as of that time except to the extent that such representations
      and
      warranties relate expressly to an earlier date); and no Default or Event of
      Default under this Term Loan Agreement shall have occurred and be continuing
      on
      the date of any advance of any Term Loan. Each of the Bank shall have received
      a
      Compliance Certificate of the Borrowers in the form of Exhibit C
      hereto.

    

              8.02     No
      Legal Impediment.  No change shall have occurred in any law or
      regulations thereunder or interpretations thereof that in the reasonable opinion
      of the Bank would make it illegal for the Bank to make such Term
      Loan.

    

    ARTICLE
      9. Events of Default, Acceleration, etc.

    

              9.01     Events
      of Default and Acceleration.  If any of the following events
      ("Events of Default") shall occur:

    
      
        
        

      

      
        29

        
        

      

      
        
        

      

    

    

                             (a)     the
      Borrowers shall fail to pay any principal of the Term Loans when the same shall
      become due and payable, whether at the stated date of maturity or any
      accelerated date of maturity or at any other date fixed for
      payment;

    

                             (b)     the
      Borrowers shall fail to pay any interest on the Term Loans or any other sums
      due
      hereunder or under any of the other Loan Documents when the same shall become
      due and payable, whether at the stated date of maturity or any accelerated
      date
      of maturity or at any other date fixed for payment, and such failure continues
      for five (5) days;

    

                             (c)     any
      Borrower or any Guarantor or any of their respective Subsidiaries shall fail
      to
      comply with any of their respective covenants contained in Sections 6.01,
      6.06,6.07, 6.12, 6.14, 6.20 or 6.21;

    

                             (d)     any
      Borrower or any Guarantor or any of their respective Subsidiaries shall fail
      to
      perform any other term, covenant or agreement contained herein or in any other
      Loan Document (other than those specified elsewhere in this Section 9.01) and
      such failure continues for thirty (30) days;

    

                             (e)     any
      representation or warranty of any Borrower or any Guarantor in this Term Loan
      Agreement or any of the other Loan Documents or in any other document or
      instrument delivered pursuant to or in connection with this Term Loan Agreement
      shall prove to have been false in any material respect upon the date when made
      or deemed to have been made or repeated;

    

                             (f)     an
      "Event of Default" shall have occurred and be continuing under the terms of
      the
      Credit Agreement;

    

                             (g)     any
      Borrower, any Guarantor or any of their respective Subsidiaries shall make
      an
      assignment for the benefit of creditors, or admit in writing its inability
      to
      pay or generally fail to pay its debts as they mature or become due, or shall
      petition or apply for the appointment of a trustee or other custodian,
      liquidator or receiver of any Borrower, any Guarantor or any of their respective
      Subsidiaries or of any substantial part of the properties or assets of any
      Borrower. any Guarantor or any of their respective Subsidiaries or shall
      commence any case or other proceeding relating to any Borrower, any Guarantor
      or
      any of their respective Subsidiaries under any bankruptcy, reorganization,
      arrangement, insolvency, readjustment of debt, dissolution or liquidation or
      similar law of any jurisdiction, now or hereafter in effect, or shall take
      any
      action to authorize or in furtherance of any of the foregoing, or if any such
      petition or application shall be filed or any such case or other proceeding
      shall be commenced against any Borrower, any Guarantor or any of their
      respective Subsidiaries and (i) any Borrower, any Guarantor or any of their
      respective Subsidiaries shall indicate its approval thereof, consent thereto
      or
      acquiescence therein or (ii) any such petition, application, case or other
      proceeding shall continue undismissed, or unstayed and in effect, for a period
      of sixty (60) days; ;

    

                             (h)     a
      decree or order is entered appointing any trustee, custodian, liquidator or
      receiver or adjudicating any Borrower, any Guarantor or any of their respective
      Subsidiaries

    
      
        
        

      

      
        30

        
        

      

      
        
        

      

    

    bankrupt
      or insolvent, or approving a petition in any such case or other proceeding,
      or a
      decree or order for relief is entered in respect of any Borrower, any Guarantor
      or any of their respective Subsidiaries in an involuntary case under federal
      bankruptcy laws as now or hereafter constituted;

    

                             (i)     any
      of the Loan Documents or any material provision of any Loan Documents shall
      be
      cancelled, terminated, revoked or rescinded otherwise than in accordance with
      the terms thereof or with the express prior written agreement, consent or
      approval of the Bank any Guaranty shall be cancelled, terminated, revoked or
      rescinded at any time or for any reason whatsoever, or any action at law, suit
      or in equity or other legal proceeding to make unenforceable, cancel, revoke
      or
      rescind any of the Loan Documents shall be commenced by or on behalf of any
      Borrower or any of its Subsidiaries or any Guarantor or any of its Subsidiaries,
      or any court or any other governmental or regulatory authority or agency of
      competent jurisdiction shall make a determination that, or issue a judgment,
      order, decree or ruling to the effect that, any one or more of the Loan
      Documents is illegal, invalid or unenforceable as to any material terms
      thereof;

    

                             (j)     any
      "Event of Default" or default (after notice and expiration of any period of
      grace, to the extent provided, and if none is specifically provided, then for
      a
      period of thirty (30) days after notice), as defined or provided in any of
      the
      other Loan Documents, shall occur and be continuing;

    

    then,
      and in any such event, so long as the same may be continuing, the Bank may,
      by
      notice in writing to the Borrowers, declare all amounts owing with respect
      to
      this Term Loan Agreement, the Term Loan Note and the other Loan Documents to
      be,
      and they shall thereupon forthwith become, immediately due and payable without
      presentment, demand, protest or other notice of any kind, all of which are
      hereby expressly waived by each Borrower and each Guarantor; provided that
      in
      the event of any Event of Default specified in Section 9.01(g) or Section
      9.01(h), all such amounts shall become immediately due and payable automatically
      and without any requirement of notice from the Bank or action by the
      Bank.

    

              9.02     Termination
      of Commitments.  If any one or more Events of Default specified in
      Section 9.01(g) or Secton 9.01(h) shall occur, any obligation of the Bank to
      make the additional Term Loans hereunder shall forthwith terminate and the
      Bank
      shall be relieved of all obligations to make such additional Term Loans to
      the
      Borrowers. No such termination of the credit hereunder shall relieve any
      Borrower or any Guarantor of any of the Obligations or any of its existing
      obligations to the Bank arising under other agreements or
      instruments.

    

              9.03     Remedies.  In
      the event that one or more Events of Default shall have occurred and be
      continuing, whether or not the Bank shall have accelerated the maturity of
      the
      Term Loans pursuant to Section 9.01, the Bank if owed any amount with respect
      to
      the Term Loans proceeds to protect and enforce the rights and remedies of the
      Bank under this Term Loan Agreement, the Term Loan Note, any or all of the
      other
      Loan Documents or under applicable law by suit in equity, action at law or
      other
      appropriate proceeding (including for the specific performance of any covenant
      or agreement contained in this Term Loan Agreement or the other Loan Documents
      or any instrument pursuant to which the Obligations are evidenced and the
      obtaining

    
      
        
        

      

      
        31

        
        

      

      
        
        

      

    

    of
      the appointment of a receiver) and, if any amount shall have become due, by
      declaration or otherwise, proceed to enforce the payment thereof or any other
      legal or equitable right or remedy of the Bank under the Loan Documents or
      applicable law.  No remedy herein conferred upon the Bank or the
      holder of any Term Loan Note is intended to be exclusive of any other remedy
      and
      each and every remedy shall be cumulative and shall be in addition to every
      other remedy given hereunder or under any of the other Loan Documents or now
      or
      hereafter existing at law or in equity or by statute or any other provision
      of
      law.

    

              9.04     Distribution
      of Proceeds.  In the event that, following the occurrence or
      during the continuance of any Default or Event of Default, the Bank receives
      any
      monies from the Borrowers or in connection with the enforcement of any the
      Guaranties, such monies shall be distributed for application as
      follows:

    

                             (a)     First,
      to the payment of, or (as the case may be) the reimbursement of the Bank for
      or
      in respect of all reasonable costs, expenses, disbursements and losses which
      shall have been incurred or sustained by the Bank in connection with the
      collection of such monies by the Bank, for the exercise, protection or
      enforcement by the Bank of all or any of the rights, remedies, powers and
      privileges of the Bank under this Term Loan Agreement or any of the other Loan
      Documents or in support of any provision of adequate indemnity to the Bank
      against any taxes or liens which by law shall have, or may have, priority over
      the rights of the Bank to such monies;

    

                             (b)     Second,
      to all other Obligations in such order or preference as the Bank may
      determine;

    

                             (c)     Third,
      the excess, if any, shall be returned to the Borrowers or to such other Persons
      as are entitled thereto.

    

    ARTICLE
      10. Set Off.

    

              Borrowers
      and each Guarantor hereby grants to the Bank a continuing lien, security
      interest and right of setoff as security for all liabilities and obligations
      to
      the Bank, whether now existing or hereafter arising, upon and against all
      deposits, credits and property, now or hereafter in the possession, custody,
      safekeeping or control of the Bank and its successors and assigns or in transit
      to any of them. Without demand or notice to the extent permitted by applicable
      law, during the continuance of any Event of Default, any deposits (general
      or
      specific, time or demand, provisional or final, regardless of currency,
      maturity, or the branch at which such deposits are held, but specifically
      excluding tenant security deposits, other fiduciary accounts and other
      segregated escrow accounts required to be maintained by any of the Borrowers
      for
      the benefit of any third party) or other sums credited by or due from the Bank
      to any of the Borrowers or any other property of any of the Borrowers in the
      possession of the Bank may be applied to or set off against the payment of
      the
      Obligations.

    
      
        
        

      

      
        32

        
        

      

      
        
        

      

    

    ARTICLE
      11. Expenses.

    

              The
      Borrowers jointly and severally agree to pay (a) the reasonable fees, expenses
      and disbursements of the Bank's outside counsel or any local counsel to the
      Bank
      incurred in connection with the preparation, administration or interpretation
      of
      the Loan Documents and other instruments mentioned herein, each closing
      hereunder, and amendments, modifications, approvals, consents or waivers hereto
      or hereunder, (b) the fees, expenses and disbursements of the Bank incurred
      by
      the Bank in connection with the preparation, administration or interpretation
      of
      the Loan Documents and other instruments mentioned herein, any amendments,
      modifications, approvals, consents or waivers hereto or hereunder, or the
      cancellation of any Loan Document upon payment in full in cash of all of the
      Obligations or pursuant to any terms of such Loan Document for providing for
      such cancellation, including, without limitation, the fees and disbursements
      of
      the Bank's counsel in preparing the documentation, (c) all reasonable expenses
      (including reasonable attorneys' fees and costs, which attorneys may be
      employees of the Bank, and the fees and costs of appraisers, engineers,
      investment bankers, surveyors or other experts retained by the Bank in
      connection with any such enforcement proceedings) incurred by the Bank in
      connection with (i) the enforcement of or preservation of rights under any
      of
      the Loan Documents against any Borrower or any Guarantor or the administration
      thereof after the occurrence and during the continuance of a Default or Event
      of
      Default (including, without limitation, expenses incurred in any restructuring
      and/or "workout" of the Term Loans), and (ii) subject to the limitation set
      forth in Section 12 hereof, any litigation, proceeding or dispute whether
      arising hereunder or otherwise, in any way related to the Bank's relationship
      with any Borrower or any Guarantor, (d) all reasonable fees, expenses and
      disbursements of the Bank incurred in connection with UCC searches and (e)
      all
      costs incurred by the Bank in the future in connection with its inspection
      of
      the Unencumbered Properties after the occurrence and during the continuance
      of
      an Event of Default.  The covenants of this Section 11 shall survive
      payment or satisfaction of payment of amounts owing with respect to the Term
      Loan Note.

    

    ARTICLE
      12. Indemnification.

    

              The
      Borrowers jointly and severally agree to indemnify and hold harmless the Bank
      and the shareholders, directors, agents, counsel, professional advisors,
      officers, subsidiaries and Affiliates of the Bank (each group consisting of
      an
      Agent or a Lender and its respective shareholders, directors, agents, counsel,
      professional advisors, officers, subsidiaries and Affiliates being an
      "Indemnified Bank's Group") from and against any and all claims, actions and
      suits, whether groundless or otherwise, and from and against any and all
      liabilities, losses, settlement payments, obligations, damages and expenses
      of
      every nature and character, arising out of this Term Loan Agreement or any
      of
      the other Loan Documents or the transactions contemplated hereby or thereby
      or
      which otherwise arise in connection with the financing, including, without
      limitation, (a) any actual or proposed use by any Borrower of the proceeds
      of
      any of the Term Loans, (b) any Borrower or any Guarantor entering into or
      performing this Term Loan Agreement or any of the other Loan Documents or the
      transactions contemplated by this Term Loan Agreement or any of the other Loan
      Documents, or (c) pursuant to Section 6.17 hereof, in each case including,
      without limitation, the reasonable fees and disbursements of counsel and
      allocated costs of internal counsel incurred in connection with any such
      investigation, litigation or other proceeding, provided, however, that the
      Borrowers shall not be

    
      
        
        

      

      
        33

        
        

      

      
        
        

      

    

    obligated
      under this Article 12 to indemnify any Person for liabilities arising from
      the
      gross negligence or willful misconduct of such Person or of any other Person
      in
      the Indemnified Group of which such Person is a member (but such indemnification
      shall continue to apply to all other Persons).  Each Person to be
      indemnified under this Article 12 shall give the Borrowers notice of any claim
      as to which it is seeking indemnification under this Article 12 promptly after
      becoming aware of the same (which shall constitute notice for all Indemnified
      Group), but such Person's failure to give prompt notice shall not affect the
      obligations of the Borrowers under this Article 12 unless such failure
      prejudices the legal rights of the Borrowers regarding such
      indemnity.  In litigation, or the preparation therefor, the Borrowers
      shall be entitled to select counsel reasonably acceptable to the Bank, and
      the
      Bank shall be entitled to select their own supervisory counsel and, in addition
      to the foregoing indemnity, the Borrowers agree to pay promptly the reasonable
      fees and expenses of each such counsel if (i) in the reasonable opinion of
      the
      Bank, use of counsel of the Borrowers' choice could reasonably be expected
      to
      give rise to a conflict of interest, (ii) the Borrowers shall not have employed
      counsel reasonably satisfactory to the Bank within a reasonable time after
      notice of the institution of any such litigation or proceeding or (iii) the
      Borrower Representative authorizes the Bank to employ separate counsel at the
      Borrowers' expense.  If and to the extent that the obligations of the
      Borrowers under this Article 12 are unenforceable for any reason, the Borrowers
      hereby agree to make the maximum contribution to the payment in satisfaction
      of
      such obligations which is permissible under applicable law.  The
      provisions of this Article 12 shall survive the repayment of the Term Loans
      and
      the termination of the obligations of the Bank hereunder and shall continue
      in
      full force and effect as long as the possibility of any such claim, action,
      cause of action or suit exists.

    

    ARTICLE
      13. Survival of Covenants, Etc.

    

              All
      covenants, agreements, representations and warranties made herein, in the Term
      Loan Note, in any of the other Loan Documents or in any documents or other
      papers delivered by or on behalf of any Borrower or any of its Subsidiaries
      or
      any Guarantor pursuant hereto shall be deemed to have been relied upon by the
      Bank, notwithstanding any investigation heretofore or hereafter made by any
      of
      them, and shall survive the making by the Bank of any of the Term Loans, as
      herein contemplated, and shall continue in full force and effect so long as
      any
      amount due under this Term Loan Agreement or the Term Loan Note or any of the
      other Loan Documents remains outstanding.  The indemnification
      obligations of the Borrowers provided herein and in the other Loan Documents
      shall survive the full repayment of amounts due and the termination of the
      obligations of the Bank hereunder and thereunder to the extent provided herein
      and therein.

    

    ARTICLE
      14. Assignment

    

              This
      Term Loan Agreement and the other Loan Documents shall be binding upon the
      parties hereto and their respective successors and assigns and shall inure
      to
      the benefit of the parties hereto and their successors and permitted
      assigns.  Notwithstanding the foregoing, none of the Borrowers shall
      assign or transfer any of its rights or obligations under any of the Loan
      Documents without prior consent of the Bank (and any such attempted assignment
      or transfer by any Borrower without such consent shall be null and
      void).

    
      
        
        

      

      
        34

        
        

      

      
        
        

      

    

    ARTICLE
      15. Notices, Etc.

    

              Except
      as otherwise expressly provided in this Term Loan Agreement, all notices and
      other communications made or required to be given pursuant to this Term Loan
      Agreement or the Term Loan Note shall be in writing and shall be delivered
      in
      hand, mailed by United States registered or certified first class mail, postage
      prepaid, sent by overnight courier, or sent by facsimile and confirmed by
      delivery via courier or postal service, addressed as follows:

    

                             (a)     if
      to any Borrower or any Guarantor, to the Borrower Representative at Sovran
      Self
      Storage, Inc., 6467 Main Street, Buffalo, New York 14221, Attention: Mr. David
      L. Rogers, Chief Financial Officer, with a copy to Phillips Lytle LLP, One
      HSBC
      Center, Buffalo, New York 14203, Attention: Raymond H. Seitz, Esq., or to such
      other address for notice as the Borrower Representative or any Guarantor shall
      have last furnished in writing to the Bank;

    

                             (b)     if
      to the Bank, at Manufacturers and Traders Trust Company, One M&T Plaza,
      Buffalo, New York 14203, Attention: Susan Freed-Oestreicher, Vice President,
      or
      such other address for notice as the Bank shall have last furnished in writing
      to the Borrowers, with a copy to William E. Mathias, Esq., Lippes Mathias Wexler
      Friedman LLP, 665 Main Street, Ste. 300, Buffalo, New York 14203, or at such
      other address for notice as the Bank shall last have furnished in writing to
      the
      Person giving the notice;.

    

              Any
      such notice or demand shall be deemed to have been duly given or made and to
      have become effective (i) if delivered by hand, overnight courier or facsimile
      to the party to which it is directed, at the time of the receipt thereof by
      such
      party or the sending of such facsimile with electronic confirmation of receipt
      and (ii) if sent by registered or certified first-class mail, postage prepaid,
      on the fifth Business Day following the mailing thereof.

    

    ARTICLE
      16. Miscellaneous.

    

                             (a)     Governing
      Law, Consent to Jurisdiction and Service.  THIS TERM LOAN
      AGREEMENT AND EACH OF THE OTHER LOAN DOCUMENTS, EXCEPT AS OTHERWISE SPECIFICALLY
      PROVIDED THEREIN, ARE CONTRACTS UNDER THE LAWS OF THE STATE OF NEW YORK AND
      SHALL FOR ALL PURPOSES BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE
      LAWS
      OF THE STATE OF NEW YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE
      OF LAW). EACH OF THE BORROWERS AND THE GUARANTORS AGREES THAT ANY SUIT FOR
      THE
      ENFORCEMENT OF THIS TERM LOAN AGREEMENT OR ANY OF THE OTHER LOAN DOCUMENTS
      MAY
      BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN BUFFALO, NEW YORK
      OR ANY FEDERAL COURT SITTING IN THE WESTERN DISTRICT OF NEW YORK, AND CONSENTS
      TO THE NON-EXCLUSIVE JURISDICTION OF SUCH COURTS AND THE SERVICE OF PROCESS
      IN
      ANY SUCH SUIT BEING MADE UPON THE BORROWERS OR THE GUARANTORS BY MAIL AT THE
      ADDRESS SPECIFIED IN ARTICLE 15.  THE BORROWERS AND EACH OF THE
      GUARANTORS HEREBY WAIVES ANY OBJECTION THAT EITHER OF THEM MAY NOW OR HEREAFTER
      HAVE TO THE VENUE OF ANY

    
      
        
        

      

      
        35

        
        

      

      
        
        

      

    

    SUCH
      SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT
      COURT.

    

              16.02     Headings.  The
      captions in this Term Loan Agreement are for convenience of reference only
      and
      shall not define or limit the provisions hereof.

    

              16.03     Counterparts.  This
      Term Loan Agreement and any amendment hereof may be executed in several
      counterparts and by each party on a separate counterpart, each of which when
      so
      executed and delivered shall be an original, and all of which together shall
      constitute one instrument.  In proving this Term Loan Agreement it
      shall not be necessary to produce or account for more than one such counterpart
      signed by the party against whom enforcement is sought. Delivery of an executed
      counterpart of a signature page of this Term Loan Agreement by telecopy shall
      be
      effective as delivery of a manually executed counterpart of this Term Loan
      Agreement.

    

              16.04     Entire
      Agreement, Etc.  The Loan Documents and any other documents
      executed in connection herewith or therewith express the entire understanding
      of
      the parties with respect to the transactions contemplated hereby and supersede
      any and all previous agreements and understandings, oral or written, relating
      to
      the transactions contemplated hereby.  Neither this Term Loan
      Agreement nor any term hereof may be changed, waived, discharged or terminated,
      except as provided in Section 16.06

    

              16.05     Waiver
      of Jury Trial and Certain Damage Claims.  EXCEPT TO THE EXTENT
      EXPRESSLY PROHIBITED BY LAW. EACH OF THE BORROWERS. EACH OF THE GUARANTORS,
      THE
      BANK HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ITS RESPECTIVE
      RIGHTS TO A JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY
      DISPUTE IN CONNECTION WITH THIS TERM LOAN AGREEMENT, THE TERM LOAN NOTE OR
      ANY
      OF THE OTHER LOAN DOCUMENTS, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THEREUNDER
      OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS OR ANY COURSE OF CONDUCT,
      COURSE OF DEALINGS, STATEMENTS (WHETHER VERBAL OR WRITTEN) OR ACTIONS OF ANY
      PARTY.  EXCEPT TO THE EXTENT EXPRESSLY PROHIBITED BY LAW, EACH OF THE
      BORROWERS AND EACH OF THE GUARANTORS HEREBY KNOWINGLY, VOLUNTARILY AND
      INTENTIONALLY WAIVES ANY RIGHT ANY OF THEM MAY HAVE TO CLAIM OR RECOVER IN
      ANY
      LITIGATION REFERRED TO IN THE PRECEDING SENTENCE ANY SPECIAL, EXEMPLARY,
      PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION
      TO,
      ACTUAL DAMAGES. EACH OF THE BORROWERS AND THE GUARANTORS (A) CERTIFIES THAT
      NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY LENDER OR THE AGENT HAS REPRESENTED,
      EXPRESSLY OR OTHERWISE, THAT SUCH LENDER OR THE AGENT WOULD NOT, IN THE EVENT
      OF
      LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVERS AND (B) ACKNOWLEDGE THAT
      THE
      AGENT AND THE BANK HAVE BEEN INDUCED TO ENTER INTO THIS TERM LOAN AGREEMENT
      AND
      THE OTHER LOAN DOCUMENTS TO WHICH THEY ARE PARTIES

    
      
        
        

      

      
        36

        
        

      

      
        
        

      

    

    BY,
      AMONG OTHER THINGS, THE WAIVERS AND CERTIFICATIONS CONTAINED
      HEREIN.

    

              16.06     Consents,
      Amendments. Waivers, Etc.  Except as otherwise expressly provided
      in this Term Loan Agreement, any consent or approval required or permitted
      by
      this Term Loan Agreement may be given, and any term of this Term Loan Agreement
      or of any of the other Loan Documents may be amended, and the performance or
      observance by any Borrower or any Guarantor of any terms of this Term Loan
      Agreement or the other Loan Documents or the continuance of any default, Default
      or Event of Default may be waived (either generally or in a particular instance
      and either retroactively or prospectively) with, but only with, the written
      consent of the Bank.

    

    No
      waiver shall extend to or affect any obligation not expressly waived or impair
      any right consequent thereon.  No course of dealing or delay or
      omission on the part of the Bank in exercising any right shall operate as a
      waiver thereof or otherwise be prejudicial to such right or any other rights
      of
      the Bank.  No notice to or demand upon any Borrower shall entitle any
      Borrower to other or further notice or demand in similar or other
      circumstances.

    

              16.07     Severability.  The
      provisions of this Term Loan Agreement are severable, and if any one clause
      or
      provision hereof shall be held invalid or unenforceable in whole or in part
      in
      any jurisdiction, then such invalidity or unenforceability shall affect only
      such clause or provision, or part thereof, in such jurisdiction, and shall
      not
      in any manner affect such clause or provision in any other jurisdiction, or
      any
      other clause or provision of this Term Loan Agreement in any
      jurisdiction.

    

              16.08     USA
      Patriot Act Notice.  The Bank is subject to the Act (as
      hereinafter defined) and hereby notifies the Borrowers that pursuant to the
      requirements of the USA Patriot Act (Title III of Pub. L. 107-56 (signed into
      law October 26,2001)) (the "Act"), it is required to obtain, verify and
      record information that identifies the Borrowers, which information includes
      the
      names and addresses of the Borrowers and other information that will allow
      the
      Bank, as applicable, to identify the Borrowers in accordance with the
      Act.

    

    REMAINDER
      OF PAGE INTENTIONALLY LEFT BLANK

    

    
      
        
        

      

      
        37

        
        

      

      
        
        

      

    

              IN
      WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed
      by
      their duly authorized officers, all as of the 12th day of September,
      2007.

    

    

    
      	 	
              MANUFACTURERS
                AND TRADERS TRUST

              COMPANY

               

              By:_______________________________________

              Name:  Susan
                Freed-Oestreicher

              Title:  Vice
                President

               

            
	 	 
	
              SOVRAN
                SELF STORAGE, INC.

               

               

              By:________________________________

              Name:  Name:
                David L. Rogers

              Title:  Chief
                Financial Officer

               

               

               

            	 
	 	 
	
              SOVRAN
                ACQUISITION LIMITED PARTNERSHIP

               

              By:
                SOVRAN HOLDINGS, INC., its General Partner

               

               

              By:_________________________________

              Name:  Name:
                David L. Rogers

              Title:  Chief
                Financial Officer

               

            

    

    

    
      
        
        

      

      
        38

        
        

      

      
        
        

      

    

    

    EXHIBIT
      A

    

    

    TERM
      LOAN NOTE

    

    

    
      	
              $25,000,000.00

            	
              September
                __, 2007

            

    

    

    

              FOR
      VALUE RECEIVED, the undersigned SOVRAN SELF STORAGE, INC., a Maryland
      corporation ("Sovran"), and the undersigned SOVRAN ACQUISITION LIMITED
      PARTNERSHIP, a Delaware limited partnership ("SALP" and together with Sovran,
      collectively referred to herein as the "Borrowers" and individually as a
      "Borrower"), hereby jointly and severally promise to pay to the order of
      MANUFACTURERS AND TRADERS TRUST COMPANY, (the "Bank") at the Bank's Principal
      Office (as defined in the Term Loan Agreement defined below):

    

              (a)     prior
      to or on the Maturity Date, the principal amount of Twenty-Five Million Dollars
      ($25,000,000.00) or, if less, the aggregate unpaid principal amount of all
      Term
      Loans advanced by the Bank to the Borrower pursuant to the Term Loan Agreement
      dated as of September __, 2007 (as amended and in effect from time to time,
      the
      "Term Loan Agreement") between the Bank and the Borrowers; and

    

              (b)     interest
      from the date hereof on the principal balance hereof from time to time
      outstanding at the times and at the rate or rates provided in the Term Loan
      Agreement and any other sums or fees due thereunder, all in accordance with
      the
      Term Loan Agreement.

    

              This
      Term Loan Note evidences borrowings under and has been issued by the Borrowers
      in accordance with the terms of the Term Loan Agreement.  The Bank and
      any holder hereof pursuant to the Term Loan Agreement or by operation of law
      is
      entitled to the benefits of the Term Loan Agreement and the other Loan
      Documents, and may enforce the agreements of the Borrowers contained therein,
      and any holder hereof may exercise the respective remedies provided for thereby
      or otherwise available in respect thereof, all in accordance with the respective
      terms thereof.  All capitalized terms used in this Tern Loan Note and
      not otherwise defined herein shall have the same meanings herein as in the
      Term
      Loan Agreement.

    

              The
      Borrowers irrevocably authorize the Bank to make or cause to be made, at or
      about the time of advance of the Term Loans or at the time of receipt of any
      payment of principal of this Term Loan Note, an appropriate notation on the
      grid
      attached to this Term Loan Note, or the continuation of such grid, or any other
      similar record, including computer records, reflecting the making of such Term
      Loan or (as the case may be) the receipt of such payment.  The
      outstanding amount of the Term Loans set forth on the grid attached to this
      Term
      Loan Note, or the continuation of such grid, or any other similar record,
      including computer records, maintained by the Bank with respect to the Term
      Loans shall be prima facie evidence of the principal amount thereof owing and
      unpaid to the Bank, but the failure to record, or any error in so recording,
      any

    
      
        
        

      

      
        39

        
        

      

      
        
        

      

    

    such
      amount on any such grid, continuation or other record shall not limit or
      otherwise affect the obligation of the Borrowers hereunder or under the Term
      Loan Agreement to make payments of principal of and interest on this Term Loan
      Note when due to the extent of the unpaid principal and interest amount as
      of
      any date of determination.

    

              The
      Borrowers have the right in certain circumstances and the obligation under
      certain other circumstances to prepay the whole or part of the principal of
      this
      Term Loan Note on the terms and conditions specified in the Term Loan
      Agreement.

    

              If
      any one or more of the Events of Default shall occur, the entire unpaid
      principal amount of this Term Loan Note and all of the unpaid interest accrued
      thereon and any other charges or amounts due under any of the Loan Documents
      may
      become or be declared due and payable in the manner and with the effect provided
      in the Term Loan Agreement.

    

              No
      delay or omission on the part of the Bank, or any holder hereof in exercising
      any right hereunder shall operate as a waiver of such right or of any other
      rights of the Bank or such holder, nor shall any delay, omission or waiver
      on
      any one occasion be deemed a bar or waiver of the same or any other right on
      any
      further occasion.

    

              The
      Borrowers and every endorser and guarantor of this Term Loan Note or the
      obligations represented hereby waives presentment, demand, notice, protest
      and
      all other demands and notices in connection with the delivery, acceptance,
      performance, default or enforcement of this Term Loan Note, and assents to
      any
      extension or postponement of the time

    of
      payment or any other indulgence, to any substitution, exchange or release of
      collateral and to

    the
      addition or release of any other party or person primarily or secondarily
      liable.

    

              THIS
      TERM LOAN NOTE AND THE OBLIGATIONS OF THE BORROWERS HEREUNDER SHALL FOR ALL
      PURPOSES BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAW OF THE STATE
      OF
      NEW YORK (EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW). EACH
      OF
      THE BORROWERS AGREES THAT ANY SUIT FOR THE ENFORCEMENT OF THIS TERM LOAN NOTE
      MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN BUFFALO, NEW
      YORK OR ANY FEDERAL COURT SITTING IN THE WESTERN DISTRICT OF NEW YORK AND
      CONSENTS TO THE NONEXCLUSIVE JURISDICTION OF SUCH COURTS AND THE SERVICE OF
      PROCESS IN ANY SUCH SUIT BEING MADE UPON THE BORROWERS BY MAIL AT THE ADDRESS
      SPECIFIED IN THE TERM LOAN AGREEMENT.  EACH OF THE BORROWERS HEREBY
      WAIVES ANY OBJECTION THAT IT MAY NOW OR HEREAFTER HAVE TO THE VENUE OF ANY
      SUCH
      SUIT OR ANY SUCH COURT OR THAT SUCH SUIT IS BROUGHT IN AN INCONVENIENT
      COURT.

    
      
        
        

      

      
        40

        
        

      

      
        
        

      

    

              IN
      WITNESS WHEREOF, each of the undersigned has caused this Term Loan Note to
      be
      executed in its corporate or partnership name by its duly authorized officer
      as
      of the day and year first above written.

    

    
      	 	
              SOVRAN
                SELF STORAGE, INC.

              By:_________________________________

              Name:  David
                L. Rogers

              Title:  Chief
                Financial Officer

            
	 	 
	 	
              SOVRAN
                ACQUISITION LIMITED

                   PARTNERSHIP

               

              By:
                Sovran Holdings, Inc., its general partner

               

               

              By:_________________________________

              Name:  David
                L. Rogers

              Title:  Chief
                Financial Officer

            

    

    

    

    

    

    
      
        
        

      

      
        41

        
        

      

      
        
        

      

    

    

    

    
      	
               

               

              Date

            	
               

              Amount
                of Term

              Loan

            	
               

              Amount
                of Principal

              Paid
                or Prepaid

            	
               

              Balance
                of

              Principal
                Unpaid

            	
               

              Notation
                Made

              By:

            
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	 

    

    

    

    

    
      
        
        

      

      
        42

        
        

      

      
        
        

      

    

    
      	 	 	
                                            Exhibit
                B

            

    

    

    [FORM
      OF SUBSIDIARY GUARANTY]

    GUARANTY

    

    Guaranty,
      dated as of September, 2007 by SOVRAN HOLDINGS, INC., a Delaware corporation
      (the "Guarantor"), in favor of Manufacturers and Traders Trust Company, a New
      York banking corporation, (together with its successors and assigns, the "Bank")
      which is a party to the Term Loan Agreement dated as of January 19, 2006 between
      Sovran Self Storage, Inc., a Maryland corporation ("Sovran") and Sovran
      Acquisition Limited Partnership, a Delaware limited partnership (together with
      Sovran, collectively referred to herein as the "Borrowers") and the Bank, as
      the
      same may hereafter be amended from time to time (the "Term Loan Agreement").
      Capitalized terms used herein without definition shall have the meanings
      ascribed to them in the Term Loan Agreement

    

              WHEREAS,
      the Borrowers and the Bank have entered into the Term Loan
      Agreement;

    

              WHEREAS,
      the Borrowers and the Guarantor are members of a group of related entities,
      the
      success of either one of which is dependent in part on the success of the other
      members of such group;

    

              WHEREAS,
      the Guarantor expects to receive substantial direct and indirect benefits from
      the extensions of credit to the Borrowers by the Bank pursuant to the Term
      Loan
      Agreement (which benefits are hereby acknowledged);

    

              WHEREAS,
      it is a condition precedent to the Bank's willingness to extend, and to continue
      to extend, credit to the Borrowers under the Term Loan Agreement that the
      Guarantor execute and deliver this Guaranty; and

    

              WHEREAS,
      the Guarantor wishes to guaranty the Borrowers' obligations to the Bank under
      and "in respect of the Term Loan Agreement as herein provided.

    

              NOW,
      THEREFORE, in consideration of the foregoing, and for other good and valuable
      consideration, the receipt and sufficiency of which are hereby acknowledged,
      the
      parties hereby agree as follows:

    

              1.     Guaranty
      of Payment and Performance of Obligations.  In consideration of
      the Bank's extending credit or otherwise in its discretion giving accommodations
      to the Borrowers, the Guarantor hereby unconditionally guarantees to the B&
that the Borrowers will duly and punctually pay or perform, at the place
      specified therefor, or if no place is specified, at the Bank's Principal Office,
      (i) all indebtedness, obligations and liabilities of the Borrowers to the Bank,
      individually or collectively, under the Term Loan Agreement or any of the other
      Loan Documents or in respect of any of the Term Loans or the Term Loan Note
      or
      other instruments at any time evidencing any thereof, whether existing on the
      date of the Term Loan Agreement or arising or incurred thereafter, direct or
      indirect, secured or unsecured, joint or several, absolute or contingent,
      matured or unmatured, liquidated or unliquidated, arising by contract, operation
      of

    
      
        
        

      

      
        43

        
        

      

      
        
        

      

    

    law
      or otherwise; and (ii) without limitation of the foregoing, all reasonable
      fees,
      costs and expenses incurred by the Bank in attempting to collect or enforce
      any
      of the foregoing, accrued in each case to the date of payment hereunder
      (collectively the "Obligations" and individually an "Obligation"). This Guaranty
      is an absolute, unconditional and continuing guaranty of thefull and punctual
      payment and performance by the Borrowers of the Obligations and not of their
      collectibility only and is in no way conditioned upon any requirement that
      the
      Bank first attempt to collect any of the Obligations from the Borrowers or
      resort to any security or other means of obtaining payment of any of the
      Obligations which the Bank now has or may acquire after the date hereof or
      upon
      any other contingency whatsoever:  Upon any Event of Default which is
      continuing by the Borrowers in the full and punctual payment and performance
      of
      the Obligations, the liabilities and obligations of the Guarantor hereunder
      shall, at the option of the Bank, become forthwith due and payable to the Bank
      without demand or notice of any nature, all of which are expressly waived by
      the
      Guarantor, except for notices required to be given to the Borrowers, under
      the
      Loan Documents. Payments by the Guarantor hereunder may be required by the
      Bank
      on any number-of occasions.

    

              2.     Guarantor's
      Further Agreements to Pay.  The Guarantor further agrees, as the
      principal obligor and not as a guarantor only, to pay to the Bank forthwith
      upon
      demand, in funds immediately available to the Bank, all costs and expenses
      (including court costs and legal fees and expenses) incurred or expended by
      the
      Bank in connection with this Guaranty, and the enforcement hereof, together
      with
      interest on amounts recoverable under this Guaranty from the time after such
      amounts become due at the default rate of interest set forth in the Term Loan
      Agreement; provided that if such interest exceeds the maximum amount permitted
      to be paid under applicable law, then such interest shall be reduced to such
      maximum permitted amount.

    

              3.     Payments.  The
      Guarantor covenants and agrees that the Obligations will be paid strictly in
      accordance with, their respective terms regardless of any law, regulation or
      order now or hereafter in effect in any jurisdiction affecting any of such
      terms
      or the rights of the Bank with respect thereto.  Without limiting the
      generality of the foregoing, the Guarantor's obligations hereunder with respect
      to any Obligation shall not be discharged by a payment in a currency other
      than
      the currency in which the Obligation is denominated (the "Obligation
      Currency") or at a place other than the place specified for the payment of
      the Obligation, whether pursuant to a judgment or otherwise, to the extent
      that
      the amount so paid on conversion to the Obligation Currency and transferred
      to
      the Bank's Principal Office, under normal banking procedures does not yield
      the
      amount of Obligation Currency due thereunder.

    

              4.     Taxes.  All
      payments hereunder shall be made without any counterclaim or setoff, free and
      clear of, and without reduction by reason of, any taxes, levies, imposts,
      charges and withholdings, restrictions or conditions of any nature ("Taxes"),
      which are now or may hereafter be imposed, levied or assessed by the United
      States or any political subdivision or taxing authority thereof (or any
      non-United States jurisdiction in which there is Real Estate) on payments
      hereunder, all of which will be for the account of and paid by the
      Guarantor.  Subject to paragraph (b), if for any reason, any such
      reduction is made or any Taxes are paid by the Bank (except for taxes on income
      or profits of the Bank), Guarantor will pay to the Bank such additional amounts
      as may be necessary to ensure that the Bank receives the same net amount which
      it would have received had no reduction been made or Taxes
      paid.

    
      
        
        

      

      
        44

        
        

      

      
        
        

      

    

    

              5.     Consent
      to Jurisdiction.  The Guarantor agrees that any suit for the
      enforcement of this Guaranty or any of the other Loan Documents may be brought
      in the courts of the State of New York sitting in Buffalo, New York or any
      federal court sitting in the Western District of New York and consents to the
      non-exclusive jurisdiction of such courts and the service of process in any
      such
      suit being made upon the Guarantor by mail at the address specified
      herein.  Except to the extent such waiver is expressly prohibited by
      law, the Guarantor hereby waives any objection that it may now or hereafter
      have-to the venue of any such suit or any such court or that such suit is
      brought in an inconvenient,court.

    

              6.     Liability
      of the Guarantor.  The Bank shall have the absolute right to
      enforce the liability of the Guarantor hereunder without resort to any other
      right or remedy including any right or remedy under any other guaranty, and
      the
      release or discharge of any guarantor of any Obligations shall not affect the
      continuing liability of the Guarantor hereunder.

    

              7.     Representations
      and Warranties; Covenants.  The Guarantor hereby makes and
      confirms the representations and warranties made on its behalf by the Borrowers
      pursuant to Article 5 of the Term Loan Agreement, as if such representations
      and
      warranties were set forth herein.  The Guarantor hereby agrees to
      perform the covenants set forth in Article 6 of the Term Loan Agreement (to
      the
      extent such covenants expressly apply to the Guarantor) as if such covenants
      were set forth herein.  The Guarantor acknowledges that it, is, on a
      collective basis with the Borrowers and all other "Guarantors" (as defined
      in
      the Term Loan Agreement), bound by the covenants set forth in Article 6 of
      the
      Term Loan Agreement.  The Guarantor hereby confirms that it shall be
      bound by all acts or omissions of the Borrower Representative pursuant to the
      Term Loan Agreement.

    

              8.     Effectiveness.  The
      obligations of the Guarantor under this Guaranty shall continue in full force
      and effect and shall remain in operation until all of the Obligations shall
      have
      been paid in full or otherwise fully satisfied, and continue to be effective
      or
      be reinstated, as the case may be, if at any time payment or other satisfaction
      of any of the Obligations is rescinded or must otherwise be restored or returned
      upon the bankruptcy, insolvency, or reorganization of the Borrowers, or
      otherwise, as though such payment had not been made or other satisfaction
      occurred.  No invalidity, irregularity or unenforceability of the
      Obligations by reason of applicable bankruptcy laws, or any other similar law,
      or by reason of any law or order of any government or agency thereof pdrporting
      to reduce, amend or otherwise affect the Obligations, shall impair, affect,
      be a
      defense to or claim against the obligations of the Guarantor under this
      Guaranty.

    

              9.     Freedom
      of Lender to Deal with Borrowers and Other Parties.  The Bank
      shall be at liberty, without giving notice to or obtaining the assent of the
      Guarantor and without relieving the Guarantor of any liability hereunder, to
      deal with the Borrowers and with each other party who now is or after the date
      hereof becomes liable in any manner for any of the Obligations; in such manner
      as the Bank in its sole discretion deems fit, and to this end the Guarantor
      gives to the Bank full authority in its sole discretion to do any or all of
      the
      following things: (a) extend credit, make loans and afford other financial
      accommodations-to the Borrowers at such times, in such amounts and on such
      terms
      as the Bank may approve, (b) vary the, terms and grant

    
      
        
        

      

      
        45

        
        

      

      
        
        

      

    

    extensions
      of any present or future indebtedness or obligation of the Borrowers or of
      any
      other party to the Bank, (c) grant time, waivers and other indulgences in
      respect thereto, (d) vary, exchange, release or discharge, wholly or partially,
      otdelay in or abstain from perfecting and enforcing any security or guaranty
      or
      other means of obtaining payment of any of the Obligations which, the Bank
      now
      has or may acquire after the date hereof, (e) accept partial payments from
      the
      Borrowers or any such other party, (f) release or discharge, wholly or
      partially, any endorser or guarantor, and (g) compromise or make any settlement
      or other arrangement with the Borrowers or any such other party.

    

              10.     Unenforceability
      of Obligations Against Borrowers; Invalidity of Security or Other
      Guaranties.  If for any reason the Borrowers have no legal
      existence or are under no legal obligation to discharge any of the Obligations
      undertaken or purported to be undertaken by it or on its behalf or if any of
      the
      moneys included in the Obligations have become irrecoverable from the Borrowers
      by operation of law or for any other reason, this Guaranty shall nevertheless
      be
      binding on the Guarantor to the same extent as if the Guarantor at all times
      had
      been the principal debtor on all such Obligations.  This Guaranty
      shall be in addition to any other guaranty or other security for the
      Obligations, and it shall not be prejudiced or rendered unenforceable by the
      invalidity of any such other guaranty or security.

    

              11.     Waivers
      by Guarantor.  The Guarantor waives: notice of acceptance hereof,
      notice of any action taken or omitted by the Bank in reliance hereon, and any
      requirement that the Bank be diligent or prompt in making demands hereunder,
      giving notice of any default by the Borrowers or asserting any other rights
      of
      the Bank or any Lender hereunder.  The Guarantor also irrevocably
      waives, to the fullest extent permitted by law, all defenses in the nature
      of
      suretyship that at any line may be available in respect of the Guarantor's
      obligations hereunder by virtue of any statute of limitations, valuation, stay,
      moratorium law or other similar law now or hereafter in effect.

    

              12.     Waiver
      of Subrogation Rights.  Notwithstanding any other provision to the
      contrary contained herein or provided by applicable law, unless and until all
      of
      the Obligations have been indefeasibly paid in full in cash and satisfied (in
      full, the Guarantor hereby irrevocably waives any and all rights it may have
      at
      any time (whether arising directly or indirectly, by operation of law or by
      contract) to assert any claim against the Borrowers on account of payments
      made
      under this Guaranty, including, without limitation, any and all rights of or
      claims for subrogation, contribution, reimbursement, exoneration and indemnity,
      and further waives any benefit of and any right to participate in any collateral
      which may be held by the Bank or any affiliate of the Bank. In addition, the
      Guarantor will not claim any set-off or counterclaim against the Borrowers
      in,
      respect of any liability it may have to the Borrowers unless and until all
      of
      the Obligations have been jndefeasibly paid in full in cash and satisfied in
      full.

    

              13.     Demands.  Any
      demand on or notice made or required to be given pursuant to this Guaranty
      shall
      be in writing and shall be delivered in hand, mailed by United States registered
      or certified first class mail, postage prepaid, return receipt requested, sent
      by overnight courier, or sent by telegraph, telecopy, telefax or telex and
      confirmed by delivery via courier or postal service, addressed as
      follows:

    
      	 	
              (a)

            	
              if
                to the Guarantor, at

               

              Sovran
                Self Storage, Inc.

              6467
                Main Street

              Buffalo,
                New York 14221

              Attention:
                Mr. David L. Rogers

            	 

    

    

    or
      at such other address for notice as the Guarantor shall last have furnished
      in
      writing to the Bank with a copy to:

    

    
      	 	 	
              Phillips
                Lytle LLP

              One
                HSBC Center

              Buffalo,
                New York 14203

              Attention:
                Raymond H. Seitz, Esq.

            	 

    

    

    or
      at such other address for notice as the Guarantor shall last have furnished
      in
      writing to the Bank; and

    

    
      	 	
              (b)

            	
              if
                to the Bank, at

               

              Manufacturers
                and Traders Trust Company

              One
                M&T Plaza

              Buffalo,
                New York 124203

              Attention:
                Susan Freed-Oestreicher, Vice
                President

            

    

    

    or
      such other address for notice as the Bank shall last have furnished in writing
      to the Guarantor, with a copy to:

    

    
      	 	 	
              Lippes
                Mathias Wexler Friedman LLP

              665
                Main Street, Ste. 300

              Buffalo,
                New York 14203

              Attention:
                William E. Mathias, Esq.

            

    

    

                                                  or
      at such other address for notice as the Bank shall last have furnished in
      writing to the Guarantor.

    

    Any
      such notice or demand shall be deemed to have been duly given or made and to
      have become effective (i) if delivered by hand, overnight courier or facsimile
      to the party to which it is directed, at the time of the. receipt thereof by
      such party or the sending of such facsimile with electronic confirmation of
      receipt or (ii) if sent by registered or certified first-class mail, postage
      prepaid, return receipt requested, on the fifth Business Day following the
      mailing thereof.

    

              14.     Amendments,
      Waivers, Etc.  No provision of this Guaranty can be changed,
      waived, discharged or terminated except by an instrument in writing signed
      by
      the Bank and the Guarantor expressly referring to the provision of this Guaranty
      to which such instrument relates; and no such waiver shall extend to, affect
      or
      impair any right with respect to any Obligation which is not expressly dealt
      with therein. No course of dealing or delay or omission on the
      part

    
      
        
        

      

      
        46

        
        

      

      
        
        

      

    

    of
      the Bank in exercising any right shall operate as &waiver thereof or
      otherwise be prejudicial thereto.

    

              15.     Further
      Assurances.  The Guarantor at its sole cost and expense agrees to
      do all such things and execute, acknowledge and deliver all such documents
      and
      instruments as the Bank from time to time may reasonably request in order to
      give frill effect to this Guaranty and to perfect and preserve the rights and
      powers of the Bank hereunder.

    

              16.     Miscellaneous
      Provisions.  This Guaranty is intended to take effect as a sealed
      instrument to be governed by and construed in accordance with the laws of the
      State of New York and shall inure to the benefit of the Bank and its respective
      successors and assigns, and shall be binding on the Guarantor and the
      Guarantor's successors in title, assigns and legal
      representatives.  The rights and remedies herein provided are
      cumulative and not exclusive of any remedies provided by law or any other
      agreement.  The invalidity or unenforceability of any one or more
      sections of this Guaranty shall not affect the validity or enforceability of
      its
      remaining provisions.  Captions are for ease of reference only and
      shall not affect the meaning of the relevant provisions.  The meanings
      of all defined terms used in this Guaranty shall be equally applicable to the
      singular and plural forms of the terms defined.

    

              17.     WAIVER
      OF JURY TRIAL.  EXCEPT TO THE EXTENT SUCH WAIVER IS EXPRESSLY
      PROHIBITED BY LAW, THE GUARANTOR HEREBY IRREVOCABLY WAIVES TRIAL BY JURY IN
      ANY
      JURISDICTION AND IN ANY COURT WITH RESPECT TO, IN CONNECTION WITH, OR ARISING
      OUT OF THIS GUARANTY, THE OBLIGATIONS, OR ANY INSTRUMENT OR DOCUMENT DELIVERED
      PURSUANT HERETO OR THERETO OR ANY OTHER CLAIM OR DISPUTE HOWSOEVER ARISING,
      AMONG THE GUARANTOR, THE BORROWERS, AND THE BANK.  THIS WAIVER OF JURY
      TRIAL SHALL BE EFFECTIVE FOR EACH AND EVERY DOCUMENT EXECUTED BY THE GUARANTOR
      AND DELIVERED TO THE BANK, AS THE CASE MAY BE, WHETHER OR NOT SUCH DOCUMENTS
      SHALL CONTAIN SUCH A WAIVER OF JURY TRIAL. THE GUARANTOR CONFIRMS THAT: THE
      FOREGOING WAIVERS ARE INFORMED AND FREELY MADE.

    

              IN
      WITNESS WHEREOF, the Guarantor has executed and delivered this Guaranty as
      of
      the date first above written.

    

    
      	 	
              GUARANTOR

               

              SOVRAN
                HOLDINGS, INC.

               

               

              By:________________________________

              Name:  David
                L. Rogers

              Title:  Chief
                Financial Officer

            

    

    

    

    
      
        
        

      

      
        47

        
        

      

      
        
        

      

    

    

    EXHIBIT
      C

    

    COMPLIANCE
      CERTIFICATE

    FOR
      CHIEF FINANCIAL OFFICERS

    

              Each
      of the undersigned, being the Chief Financial Officers of Sovran Self Storage,
      Inc. ("Sovran") and Sovran Acquisition Limited Partnership ("SALP" and together
      with Sovran, collectively referred to herein as the "Borrowers"), HEREBY
      CERTIFIES THAT:

    

              This
      Compliance Certificate is furnished pursuant to Section 7.12 of the Term Loan
      Agreement dated as of September 12, 2007 between Manufacturers and Traders
      Trust
      Company and the Borrowers (as the same may now or hereafter be amended from
      time
      to time, the "Term Loan Agreement").  Unless otherwise defined herein,
      the terms used in this Compliance Certificate and attached hereto have the
      meanings given them in the Term Loan Agreement.

    

              Each
      of the Chief Financial Officers hereby certifies, in accordance with the
      provisions of Section 7.12 of the Term Loan Agreement, that

    

              (1)     The
      representations and warranties of the Borrowers contained in the Term Loan
      Agreement and in each document and instrument delivered pursuant to or in
      connection therewith are true and correct as of the date hereof and that no
      Default or Event of Default has occurred and is continuing on the date
      hereof;

    

              (2)     The
      Borrowers are in compliance with the terms of the Term Loan Agreement and no
      "Default" or "Event of Default" (as defined in the Term Loan Agreement) has
      occurred and is continuing as of the date hereof; and

    

              (3)     None
      of the Subsidiaries of either of the Borrowers owns an Unencumbered
      Property.

    

              (4)     Each
      of the Chief Financial Officers is authorized to execute and deliver this
      Compliance Certificate on behalf of Sovran or SALP, as the case may
      be.

    

              Executed
      as of this _____ day of ________________, 2007.

    

    
      	
              SOVRAN
                SELF STORAGE, INC.

               

               

               

               

              By:_________________________________

              Name:  David
                L. Rogers

              Title:  Chief
                Financial Officer

            	
              SOVRAN
                ACQUISITION LIMITED

              PARTNERSHIP

               

              By:
                Sovran Holdings Inc., its general partner

               

              By:_________________________________

              Name:  David
                L. Rogers

              Title:  Chief
                Financial Officer

            
	 	 

    

    

    
      
        
        

      

      
        48

        
        

      

      
        
        

      

    

    

    Schedule
      1

    

    Pension
      Plans

    

    

    Sovran
      401K Plan

    

    

    
      
        
        

      

      
        49

        
        

      

      
        
        

      

    

    Schedule
      5.07

    

    Litigation

    

    

    
      	
              1.

            	
              Maria
                Brennan v. Uncle Bob's Self
                Storage

            

    

    

    Maria
      Brennan, a former employee at the Alvin, Texas store, filed a charge with the
      Equal Employment Opportunity Commission (the "EEOC") in Houston, Texas on
      November 2, 2006, alleging that she had been subject to a hostile work
      environment because of her sex. Sovran Acquisition Limited Partnership responded
      to the EEOC charge and the EEOC is investigating.

    

    
      	
              2.

            	
              Kelly
                Evans v. Sovran Self Storage,
                Inc.

            

    

    

    Plaintiff
      obtained a right to sue letter from the EEOC and filed an action in Texas state
      court on May 9, 2007, alleging that she was subject to a sexually hostile work
      environment while working as an Assistant Manager.  The case was
      removed to the US. District Court for the Western District of Texas on June
      22,2007.  The complaint seeks damages for lost pay and emotional
      distress and does not seek any specific amount as damages. Sovran Self Storage,
      Inc. is defending the case.

    

    
      	
              3.

            	
              Sovran
                Self Storage, Inc., as Plan Administrator of the Sovran Acquisition
                Limited Partnership/Uncle Bob's Self Storage Health Benefits Plan
                v.
                University of Pittsburgh Medical Center as Assignee of the Estate
                of
                Pamela Harford, and UPMC Horizon
                Greenville

            

    

    

    In
      this action pending in the United States District Court for the Western District
      of New York, Sovran Self Storage, Inc. as Plan Administrator of the Health
      Benefits Plan Sponsored by Sovran Acquisition Limited Partnership/Uncle Bob's
      Self Storage ("Plan") seeks a declaratory judgment that it is not obligated
      to
      pay certain hospital bills incurred by the late Pamela Harford at a hospital
      owned and administered by the defendants.  The amount of medical bills
      in dispute totals $94,761.80.  In its complaint filed earlier this
      year, the plaintiff asserts that because the Plan participant, Ms. Harford,
      did
      not cause her medical bills to be submitted as required by the Plan within
      the
      12 month filing deadline, the Plan has no responsibility to pay those
      bills.  The defendants have filed an answer and counterclaims pursuant
      to which they assert that the Plan, which is self-funded by its sponsors, is
      required to pay the medical bills.  After the complaint and answer
      were filed in Federal Court, the parties were required to engage in a mediation
      process mandated by the Court.  That process is
      on-going.  To date, there has been no discovery in this
      action.

    

    
      	
              4.

            	
              Paula
                Hilley and Joel Hilley v. Sovran Acquisition Limited Partnership
                d/b/a
                Uncle Bob's Self Storage

            

    

    

    On
      August 7, 2007, plaintiffs filed a collective action under the Fair Labor
      Standards Act in the United States District Court for the Northern District
      of
      Alabama, Southern Division alleging that managers and maintenance employees
      at
      Sovran facilities throughout the United States have

    
      
        
        

      

      
        50

        
        

      

      
        
        

      

    

    been
      denied overtime compensation.  The proceeding as a collective action
      is subject to Court approval.  The complaint seeks unpaid overtime,
      liquidated damages in the amount of any unpaid overtime, interest and attorneys'
      fees.  Sovran Acquisition Limited Partnership is aware that this
      action has been filed but has not yet been served.

    

    
      
        
        

      

      
        51

        
        

      

      
        
        

      

    

    

    Schedule
      5.15

    

    Certain
      Transactions

    

    

    None.

    

    

    
      
        
        

      

      
        52

        
        

      

      
        
        

      

    

    Schedule
      5.19

    

    Subsidiaries
      and Partially Owned Entities

    

    

    A.     Subsidiaries
      of Sovran Self Storage, Inc.:

    

    
      	 	
              Sovran
                Holdings, Inc. - 100% Owned

            
	 	
              Sovran
                Acquisition Limited Partnership - 98% Limited Partnership
                Interest

            

    

    

    B.     Subsidiaries
      of Sovran Acquisition Limited Partnership:

    

    
      	 	
                                              100%
                Owned

               

            	 	 
	 	
              Locke
                Leasing, Inc.

            	 	
              The
                Locke Group LLC

            
	 	
              Sovran
                Jones Road, LLC

            	 	
              Locke
                Sovran I Manager, Inc.

            
	 	
              Iskalo
                Land Holdings LLC

            	 	
              Locke
                Sovran II Manager, Inc.

            
	 	
              Sovran
                Cameron, LLC

            	 	 
	 	
              Sovran
                Congress, LLC

            	 	 
	 	
              Sovran
                Huebner, LLC

            	 	 
	 	
              Sovran
                Little Road, LLC

            	 	 
	 	
              Sovran
                Granbury, LLC

            	 	 
	 	
              Sovran
                Shackelford, LLC

            	 	 
	 	
              Sovran
                Manchester, LLC

            	 	 
	 	
              Sovran
                DeGaulle, LLC

            	 	 
	 	
              Sovran
                Grapevine, LLC

            	 	 
	 	
              Sovran
                Washington, LLC

            	 	 
	 	
              Sovran
                Meramac, LLC

            	 	 
	 	
              Sovran
                Seminole, LLC

            	 	 

    

    

    
      	 	
                                          Majority
                Interest

               

            	 	 
	 	
              Locke
                Sovran I LLC

            	 	 
	 	
              Locke
                Sovran II LLC

            	 	 

    

    

    C.     Subsidiaries
      of The Locke Group LLC:

    

    
      	 	
              Locke
                Preferred Equity LLC

            	 	 
	 	
              Locke
                Preferred Equity II LLC

            	 	 

    

    

    D.     Partially
      Owned Entities:

     

    
      
        	 	
                Sovran
                  Acquisition Limited Partnership owns a 49% interest in Iskalo Office
                  Holdings, LLC as a Member

              

      

      
        
           

        

        
           

           

        

        
           

        

      

    
      
        
        

      

      
        53EX-10.1

 

Exhibit 10.1

September 17, 2007                     

Seanergy Maritime Corp.

10, Amfitheas Avenue

17564 P. Faliro

Athens, Greece

Maxim Group LLC

405 Lexington Avenue

New York, New York 10174

          Re: Initial Public Offering

Dear
Gentlemen:

     The undersigned, a shareholder, officer and director of Seanergy Maritime Corp. (the
“Company”), in consideration of Maxim Group LLC (“Maxim”) entering into a letter of intent, dated
July 21, 2006 and as amended on May 27, 2007 (“Letter of Intent”), to underwrite an initial public
offering (“IPO”) of the securities of the Company and embarking on, undertaking and continuing to
participate in the IPO process, hereby agrees as follows (certain capitalized terms used herein are
defined in paragraph XII hereof):

     I. (1) In the event that the Company fails to consummate a Business Combination within 24
months from the effective date (the “Effective Date”) of the registration statement relating to the
IPO, the undersigned shall, in accordance with all applicable requirements of the Marshall Islands
Business Corporations Act, take all action reasonably within his power to dissolve the Company and
distribute all funds held in the Trust Account to holders of the IPO Shares as soon as reasonably
practicable including, without limitation, (i) causing the Company’s board of directors to convene
and adopt a plan of dissolution and liquidation and (ii) voting, as a director (if applicable), in
favor of adopting such plan of dissolution and liquidation.

          (2) Except with respect to any of the IPO Shares acquired by the undersigned in connection
with or following the IPO, the undersigned hereby (a) waives any and all right, title, interest or
claim of any kind (a “Claim”) in or to all funds in the Trust Account and any remaining net assets
of the Company upon liquidation of the Trust Account and dissolution of the Company, (b) waives any
Claim the undersigned may have in the future as a result of, or arising out of, any contracts or
agreements with the Company (c) agrees that the undersigned will not seek recourse against the
Trust Account for any reason whatsoever.

          (3) The undersigned agrees to indemnify and hold harmless the Company against any and all
loss, liability, claims, damage and expense whatsoever (including, but not limited to, any and all
legal or other expenses reasonably incurred in investigating, preparing or defending against any
litigation, whether pending or threatened, or any claim whatsoever) to which the Company may become
subject as a result of any claim by any vendor, prospective or actual target business, creditor or
other entity that is owed money by the Company for services rendered or products sold to the
Company or the claims of any prospective or actual target

 

 

businesses, subject to the following limitations: (i) such indemnification will only be made
insofar as the Company did not obtain a waiver from such party of such party’s rights or claims to
the Trust Account, (ii) such indemnification will be made only to the extent necessary to ensure
that such loss, liability, claim, damage or expense does not reduce the amount in the Trust Account
below the amount necessary in order for each holder of IPO Shares to receive a liquidation amount
of at least $10.00 per IPO Share owned by such holder, and (iii) such indemnity shall be limited to
the extent of the undersigned’s pro rata beneficial ownership of the Company immediately prior to
the IPO.

          (4) In the event the funds available outside of the Trust Account are insufficient to cover
the Company’s liquidation expenses the undersigned, jointly with the other executive officers of
the Company, agrees to advance the Company the funds necessary to complete such liquidation and
agrees not to seek repayment for such expenses.

     II. In order to minimize potential conflicts of interest which may arise from multiple
affiliations, the undersigned agrees: (A) not to become an officer or director of any blank check
company until the earlier of the completion of a Business Combination or the Company’s dissolution
and liquidation and (B) to present to the Company for its consideration, prior to presentation to
any other person or entity, any suitable opportunity to acquire an operating business or vessels,
until the earlier of: (i) the consummation by the Company of a Business Combination, (ii) the
dissolution of the Company or (iii) such time as the undersigned ceases to be a director of the
Company, subject to any pre-existing fiduciary and contractual obligations the undersigned might
have. Such pre-existing fiduciary or contractual obligations are described more
fully in Exhibit A hereto.

     III. The undersigned acknowledges and agrees that the Company will not consummate any Business
Combination with a company affiliated with any of the Insiders unless the Company obtains an
opinion from an independent investment banking firm which is a member of the National Association
of Securities Dealers, Inc. and is reasonably acceptable to Maxim that the Business Combination is
fair to the Company’s shareholders from a financial perspective.

     IV. Neither the undersigned, any member of the Immediate Family of the undersigned, nor
any affiliate of the undersigned (“Affiliate”) will be entitled to receive, and no such person will
accept, any compensation for services rendered to the Company prior to, or in connection with, the
consummation of a Business Combination; provided, however, that the undersigned shall be entitled
to reimbursement from the Company for his out-of-pocket expenses incurred in connection with
seeking and consummating a Business Combination.

     V. Neither the undersigned, any member of the Immediate Family of the undersigned, nor any
Affiliate of the undersigned will be entitled to receive or accept a finder’s fee or any other
compensation in the event the undersigned, any member of the Immediate Family of the undersigned or
any Affiliate originates a Business Combination.

     VI. (1) The undersigned agrees to be the Chief Executive Officer and Co-Chairman of the board
of directors of the Company and a director of the Company until the earlier of the consummation of
a Business Combination or the dissolution and liquidation of the

 

 

Company. The undersigned agrees to not to resign (or advise the board of directors that the
undersigned declines to seek re-election to the board of directors) from his position as officer
and director of the Company as set forth in the Registration Statement without the prior consent of
Maxim until the earlier of the consummation by the Company of a Business Combination or dissolution
of the Company and liquidation of the Truest Account. The undersigned acknowledges that the
foregoing does not interfere with or limit in any way the right of the Company to terminate the
undersigned’s positions at any time (subject to other contractual rights the undersigned may have)
nor confer upon the undersigned any right to continue in his positions with the Company.

          (2) The undersigned’s biographical information furnished to the Company and Maxim and attached
hereto as Exhibit B is true and accurate in all respects, does not omit any material information
with respect to the undersigned’s background and contains all of the information required to be
disclosed pursuant to Item 401 of Regulation S-K, promulgated under the Securities Act of 1933, as
amended. The undersigned’s Questionnaire previously furnished to the Company and Maxim is true and
accurate in all respects as of the date first written above.

          (3) The undersigned represents and warrants that:

     (a) No petition under the Federal bankruptcy laws or any state insolvency law
has been filed by or against, or a receiver, fiscal agent or similar officer was
appointed by a court for the business or property of the undersigned, or any
partnership in which the undersigned was or is a general partner at or within two
years prior to the date hereof, or any corporation or business association of which
the undersigned was an executive officer at or within two years prior to the date
hereof;

     (b) The undersigned has not been convicted in any criminal proceeding nor is
the undersigned currently a named subject of a pending criminal proceeding
(excluding traffic violations and other minor offenses);

     (c) The undersigned has not been the subject of any order, judgment, or decree,
not subsequently reversed, suspended or vacated, of any court of competent
jurisdiction, permanently or temporarily enjoining the undersigned from, or
otherwise limiting, the following activities:

     (d) Acting as a futures commission merchant, introducing broker, commodity
trading advisor, commodity pool operator, floor broker, leverage transaction
merchant, any other person regulated by the Commodity Futures Trading Commission, or
an associated person of any of the foregoing, or as an investment adviser,
underwriter, broker or dealer in securities, or as an affiliated person, director or
employee of any investment company, bank, savings and loan association or insurance
company, or engaging in or continuing any conduct or practice in connection with
such activity;

     (e) Engaging in any type of business practice; or

 

 

     (f) Engaging in any activity in connection with the purchase or sale of any
security or commodity or in connection with any violation of Federal or State
securities laws or Federal commodities laws;

     VII. The undersigned has full right and power, without violating any agreement by which he is
bound, to enter into this letter agreement and to serve as Chief Executive Officer and Co-Chairman
of the board of directors and as a director of the Company.

     VIII. The undersigned acknowledges and understands that Maxim and the Company will rely upon
the agreements, representations and warranties set forth herein in proceeding with the IPO.

     IX. The undersigned authorizes any employer, financial institution, or consumer credit
reporting agency to release to Maxim and the Company and their respective legal representatives or
agents (including any investigative search firm retained by Maxim or the Company) any information
they may have about the undersigned’s background and finances (the “Information”). Neither Maxim
nor the Company nor their respective agents shall be violating the undersigned’s right of privacy
in any manner in requesting and obtaining the Information and the undersigned hereby releases them
from liability for any damage whatsoever in that connection.

     X. In connection with the vote required to consummate a Business Combination, the undersigned
agrees that he will vote all shares of Common Stock owned by him prior to the IPO (the “Insider
Shares”), if any, in accordance with the majority of the votes cast by the holders of the IPO
Shares, and all shares of Common Stock acquired in or following the IPO in favor of a Business
Combination.

     XI. The undersigned will escrow his Insider Shares for the period commencing on the Effective
Date and ending on the first anniversary of the consummation of a
Business Combination, subject to the terms of a Stock
Escrow Agreement which the Company will enter into with the undersigned and an escrow agent
acceptable to the Company.

     XII. This letter agreement shall be governed by and construed and enforced in accordance with
the laws of the State of New York, without giving effect to conflicts of law principles that would
result in the application of the substantive laws of another jurisdiction. The undersigned hereby
(i) agrees that any action, proceeding or claim against him arising out of or relating in any way
to this letter agreement (a “Proceeding”) shall be brought and enforced in the federal courts of
the United States of America for the Southern District of New York, and irrevocably submits to the
jurisdiction of such courts, which jurisdiction shall be exclusive, (ii) waives any objection to
the exclusive jurisdiction of such courts and any objection that such courts represent an
inconvenient forum and (iii) irrevocably agrees to appoint Loeb & Loeb LLP as agent for the service
of process in the State of New York to receive, for the undersigned and on his behalf, service of
process in any Proceeding. If for any reason such agent is unable to act as such, the undersigned
will promptly notify the Company and Maxim and appoint a substitute agent acceptable to each of the
Company and Maxim within 30 days and nothing in this letter will affect the right of either party
to serve process in any other manner permitted by law.

 

 

     XIII. As used herein, (i) a “Business Combination” shall mean an acquisition by the Company,
by merger, capital stock exchange, asset or stock acquisition, reorganization or otherwise, of an
operating business or businesses in the maritime shipping industry but not limited to acquisitions
in such industry; (ii) “Common Stock” shall mean the common stock, par value $.0001 per share, of
the Company; (iii) “Immediate Family” shall mean, with respect to any person, such person’s spouse,
children, parents and siblings (including any such relative by adoption or marriage); (iv) (v)
“Insiders” shall mean all officers, directors and shareholders of the Company immediately prior to
the IPO; (vi) “Insider Shares” shall mean all of the shares of Common Stock owned by an Insider
prior to the IPO; (vii) “IPO Shares” shall mean the shares of Common Stock issued in the Company’s
IPO; and (viii) “Trust Account” shall mean the trust account in which most of the proceeds to the
Company of the IPO will be deposited and held for the benefit of the holders of the IPO shares, as
described in greater detail in the prospectus relating to the IPO.

     XIV. This letter agreement shall supersede any other letter agreement signed by the
undersigned with respect to the subject matter hereof.

	 	 	 	 	 
	 	 	 
	 	/s/
Panagiotis Zafet	 
	 	Panagiotis Zafet 	 
	 	 	 
	 

 

 

EXHIBIT A

			
	•	 	Hellasco Shipping Ltd., Co-Owner
	 	 	 
	•	 	Balthellas Chartering S.A., Founder and Managing Director
	 	 	 
	•	 	Hellasco Transport Ltd., Co-Owner and Managing Director

 

 

EXHIBIT B

     Panagiotis Zafet has been the Chief Executive Officer and Co-Chairman of the Board of Directors since inception. Mr. Zafet has extensive experience in the management of operations in the maritime shipping industry, as well as the purchase, sale and charter of vessels. Mr. Zafet started in the liner shipping industry in 1986 at Hellasco Shipping Ltd., of which he is a co-owner. Hellasco Shipping Ltd. is active in the trade of timber products and the regular service of vessels trading between Scandinavia, Greece and Cyprus. In 1991, he founded Balthellas Chartering S.A., a ship management and shipbroking company with 2006 revenues of approximately $25 million, where he currently serves as managing director. Under his leadership, Balthellas Chartering expanded its business from the commercial management of vessels into the full-scale management of multipurpose vessels of the highest ice class, container ships, timber carriers and dry cargo ships. The fleet is trading worldwide with a strong presence in ice bound navigational waters such as the Baltic Sea, White Sea and the Sea of Azov. The Company also specializes in feeder container services offering mostly service in places with limited port infrastructures, such as in the East Mediterranean, North and West African ports, the Caribbean, Indian Ocean and the Far East. Mr. Zafet is also a co-owner and managing director of Hellasco Transport Ltd. Mr. Zafet has a law degree from the Aristotelio University of Thessaloniki and is fluent in three languages. He is a member of the Piraeus Marine Club and the Hellenic Shipbrokers Association.

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