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EXHIBIT 10.36

AMENDED AND RESTATED

INDEMNIFICATION AGREEMENT

 

          This Amended and Restated Indemnification Agreement (this "Agreement") is made as of April 20, 2006, by and between Sovran Self Storage, Inc., a Maryland corporation (the "Corporation"), Sovran Acquisition Limited Partnership, a Delaware limited partnership (the "Operating Partnership" and, collectively with the Corporation, the "Indemnitors"), and David L. Rogers, the Chief Financial Officer of the Corporation ("Executive").

RECITALS

          WHEREAS, candidates highly qualified for service on the board of directors and key executive officers of publicly-held corporations have become increasingly reluctant to serve in that capacity or in other related capacities unless they are provided with strong protection through indemnification and insurance against the substantial and escalating risks of, and potential liability from, claims and actions arising out of their service to and activities on behalf of such corporations;

          WHEREAS, the Board of Directors of the Corporation (the "Board") has determined that, in order to attract and retain such persons to serve in key executive positions, the Corporation will attempt to maintain on an ongoing basis, at its sole expense, liability insurance to protect persons serving on the Board and in other related capacities from certain liabilities, the Board recognizes that such insurance may be available to it in the future only at higher premiums and with more exclusions from its coverage, which reduces the value of such insurance to directors and executive officers and increases the importance of indemnification by the Corporation to protect directors and executive officers against such liabilities;

          WHEREAS, the Corporation indirectly controls the Operating Partnership (through its ownership of the general partner of the Operating Partnership (the "General Partner")) and conducts substantially all of its business through the Operating Partnership, such that the Operating Partnership would benefit from the Corporation's ability to attract and retain the most qualified persons to serve on its Board of Directors and as executive officers;

          WHEREAS, in order to induce the most qualified persons to serve and continue to serve as directors and executive officers of the Corporation, the Indemnitors desire to provide directors and key executive officers with specific contractual assurance of their rights to full indemnification against litigation risks and expenses associated with their service as a director or executive officer of the Corporation and in other related capacities regardless of, among other things, any amendment to or revocation of the Corporation's charter or Bylaws or any change in the ownership of the Corporation or in the composition of the Board; 

 

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          WHEREAS, the Indemnitors intend that this Agreement will provide Executive with greater protection than that which is provided by the Corporation's charter and Bylaws, the Agreement of Limited Partnership of the Operating Partnership and that this Agreement shall supplement and be in furtherance of the By-laws of the Corporation and any resolutions adopted pursuant thereto as well as the Agreement of Limited Partnership of the Operating Partnership, shall not be deemed a substitute therefor, and shall not diminish or abrogate any rights of Executive thereunder; 

          WHEREAS, Executive is relying upon the rights afforded under this Agreement in deciding to begin serving or continue to serve as a Chief Financial Officer of the Corporation; and

          WHEREAS, Executive and the Corporation acknowledge that this Agreement is intended to supercede the Indemnification Agreement, dated June 3, 1995, by and between the Corporation and Executive (the "Prior Agreement"), which heretofore has been in effect.

          NOW, THEREFORE, in consideration of the premises and covenants contained herein, and in order to induce Executive to continue to serve as the Chief Financial Officer of the Corporation and in consideration of Executive's so serving, the Indemnitors and Executive do hereby covenant and agree as follows:

          Section 1.     Services to the Corporation.  Executive agrees to continue to serve as an executive officer of the Corporation and may serve as a director, officer, employee, agent or fiduciary of one or more Covered Entities (as defined below).  Executive may at any time and for any reason resign from any such position (subject to any other contractual obligation or any obligation imposed by operation of law), in which event the Corporation shall have no obligation under this Agreement to continue Executive in any such position.  This Agreement shall not be deemed an employment contract between Executive and the Corporation (or any Covered Entity).  The foregoing notwithstanding, this Agreement shall continue in force after Executive has ceased to serve as an Executive of the Corporation or otherwise ceased to have Corporate Status (as defined below).

          Section 2.     Definitions.  As used in this Agreement:

	 	
(a)
	
A "Change in Control" shall be deemed to occur upon the earliest to 

	
occur after the date of this Agreement of any of the following events:

	 
	 	
(i)
	
Acquisition of Stock by Third Party.  Unless explicitly approved 

	
by the Incumbent Board (as defined below), any Person (as defined below) is or becomes the Beneficial Owner (as defined below), directly or indirectly, of securities of the Corporation representing 20% or more of the combined voting power of the Corporation's then outstanding securities;

	 

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(ii)
	
Change in Board of Directors.  A change in the composition of the 

	
Board of Directors of the Corporation such that the individuals who, as of the date hereof, constitute the Board of Directors of the Corporation (such Board of Directors shall be hereinafter referred to as the "Incumbent Board") cease for any reason to constitute at least a majority of the Board of Directors of the Corporation; provided, however, for purposes of this clause (ii), any individual who becomes a member of the Board of Directors of the Corporation subsequent to the date hereof whose election, or nomination for election by the Corporation's shareholders, was approved by a vote of at least a majority of those individuals who are members of the Board of Directors of the Corporation and who were also members of the Incumbent Board (or deemed to be such pursuant to this provision) shall be considered as though such individual were a member of the Incumbent Board; but, provided, further, that any such individual whose initial assumption of office occurs as a result of an actual or threatened solicitation of proxies or consents by or on behalf of a person other than the Board of Directors of the Corporation shall not be so considered as a member of the Incumbent Board; or

	 
	 	
(iii)
	
Corporation Transactions.  The effective date of a merger or 

	
consolidation of the Corporation with any other entity, other than a merger or consolidation which would result in the voting securities of the Corporation outstanding immediately prior to such merger or consolidation continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) more than 60% of the combined voting power of the voting securities of the surviving entity outstanding immediately after such merger or consolidation and with the power to elect at least a majority of the board of directors or other governing body of such surviving entity;

	 
	 	
(iv)
	
Liquidation.  Unless the liquidation is explicitly approved by the 

	
Incumbent Board, the approval by the shareholders of the Corporation of a complete liquidation of the Corporation, or a plan therefor, or an agreement for the sale or disposition by the Corporation of all or substantially all of the Corporation's assets; and

	 
	 	
(v)
	
Other Events.  Unless the event is explicitly approved by the 

	
Incumbent Board, there occurs any event of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item on any similar schedule or form) promulgated under the Exchange Act, as hereinafter defined, regardless of whether the Corporation is then subject to such reporting requirement.

	 

          Solely for purposes of this Section 2(a), the following terms shall have the following meanings:

	 	
(A)
	
"Exchange Act" shall mean the Securities Exchange Act of 1934, 

	
as amended.

	 

 

 

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(B)
	
"Person" shall have the meaning as set forth in Sections 13(d) and 

	
14(d) of the Exchange Act and, for greater clarity, shall include, without limitation, any entity or "group" within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act; provided, however, that Person shall exclude (i) the Corporation, (ii) any trustee or other fiduciary holding securities under an employee benefit plan of the Corporation, and (iii) any corporation owned, directly or indirectly, by the shareholders of the Corporation in substantially the same proportions as their ownership of stock of the Corporation.

	 
	 	
(C)
	
"Beneficial Owner" shall have the meaning given to such term in 

	
Rule 13d-3 under the Exchange Act; provided, however, that Beneficial Owner shall exclude any Person otherwise becoming a Beneficial Owner by reason of the shareholders of the Corporation approving a merger, consolidation or other business combination of the Corporation with another entity.

	 
	 	
(b)
	
"Corporate Status" describes the status of a person who is or was a 

	
director, officer, employee, agent or fiduciary of the Corporation or any Covered Entity.

	 
	 	
(c)
	
"Covered Entity" shall mean the Corporation, the Operating Partnership, 

	
the General Partner and any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan or other entity or enterprise (as well as any domestic or foreign predecessor entity of each such entity in a merger, consolidation or other transaction) of which Executive is, was or may be deemed to be serving at the request of the Corporation as a director, officer, employee, partner (limited or general), trustee, agent or fiduciary.  References to "serving at the request of the Corporation" shall include any service as a director, officer, employee, partner (limited or general), trustee, agent or fiduciary of a Covered Entity which imposes duties on, or involves services by, such director, officer, employee, partner (limited or general), trustee, agent or fiduciary with respect to an employee benefit plan, its participants or beneficiaries.

	 
	 	
(d)
	
"Disinterested Director" means a director of the Corporation who is not 

	
and was not a party to the Proceeding in respect of which indemnification is sought by [Executive].

	 
	 	
(e)
	
"Disqualifying Conduct" means (A) the act or omission of Executive was 

	
material to the matter giving rise to the Proceeding and (1) was committed in bad faith or (2) was the result of active and deliberate dishonesty, (B) Executive actually received an improper personal benefit in money, property or services, or (C) in the case of any criminal Proceeding, Executive had reason to believe that his conduct was unlawful.

	 

 

 

 

 

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(f)
	
"Expenses" shall include all reasonable attorneys' fees, retainers, court 

	
and arbitration costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, scanning and data processing charges, electronic legal research and other database charges, telephone charges, postage, delivery service fees, and all other disbursements or expenses of the types customarily incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating, being or preparing to be a witness in, or otherwise participating in, a Proceeding.  Expenses also shall include (i) Expenses incurred in connection with any appeal resulting from any Proceeding, including the premium, security for, and other costs relating to any cost bond, supersede as bond, or other appeal bond or its equivalent, and (ii) for purposes of Section 12(d) only, Expenses incurred by Executive in connection with the interpretation, enforcement or defense of Executive's rights under this Agreement, by litigation or otherwise.  Expenses, however, shall not include amounts paid in settlement by Executive or the amount of judgments or fines (including any excise tax assessed with respect to any employee benefit plan) against Executive.

	 
	 	
(g)
	
"Independent Counsel" means a law firm, or a member of a law firm, that 

	
is experienced in matters of corporation law and that neither presently is, nor in the past five years has been, retained to represent any of the following:  (i) the Indemnitors or Executive in any matter material to either such party (other than with respect to matters concerning Executive under this Agreement, or of other Executive under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder.  Notwithstanding the foregoing, the term "Independent Counsel" shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Indemnitors or Executive in an action to determine Executive's rights under this Agreement.  The Indemnitors agrees to pay the reasonable fees and expenses of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.

	 
	 	
(h)
	
"Losses" means Expenses, judgments, costs, fines (including any excise 

	
tax assessed with respect to any employee benefit plan) and amounts paid in settlement actually incurred by Executive (net of any related insurance proceeds or other indemnification payments received by Executive or paid on Executive's behalf as described in Section 7(a)).

	 
	 	
(i)
	
"Proceeding" shall include any threatened, pending or completed action, 

	
suit, arbitration, alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other actual, threatened or completed proceeding, whether brought in the right of the Corporation or otherwise and whether of a civil, criminal, administrative or investigative nature, in which Executive was, is or may be involved as a party or otherwise by reason of Executive's Corporate Status or by reason of any action taken by him or of any action or omission on his part in connection with Executive's Corporate Status, in each case regardless of whether Executive retains Corporate Status at the time any liability or expense is incurred for

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which indemnification, reimbursement, or advancement of expenses can be provided under this Agreement.  However, a "Proceeding" does not include an action, suit or proceeding initiated by Executive to enforce his rights under this Agreement.

	 

          Section 3.     Indemnification.  The Indemnitors shall indemnify Executive and hold Executive harmless against any and all Losses in connection with any present or future threatened, pending or completed Proceeding, regardless of whether such Proceeding is by or in the right of the Corporation, based upon arising from, relating to, or by reason of Executive's Corporate Status; provided, that no indemnification pursuant to this Section 3 may be made to Executive or on Executive's behalf with respect to any Proceeding if a final judgment or other final adjudication adverse to Executive establishes that Executive engaged in Disqualifying Conduct with respect to such Proceeding.

          Section 4.     Indemnification for Expenses of a Party Who is Wholly or Partly Successful.  Notwithstanding any other provisions of this Agreement, to the fullest extent permitted by applicable law and to the extent that Executive is a party to (or a participant in) and is successful, on the merits or otherwise, in any Proceeding or in the defense of any claim, issue or matter therein, in whole or in part, the Indemnitors shall indemnify Executive against all Expenses actually and reasonably incurred by him in connection therewith.  If Executive is not wholly successful in such Proceeding, the Indemnitors also shall indemnify Executive against all Expenses reasonably incurred in connection with each successfully resolved claim, issue or matter and each claim, issue or matter related to each successfully resolved claim, issue, or matter.  For purposes of this Section 4 and without limitation, the termination of any claim, issue or matter in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue or matter.

          Section 5.     Indemnification For Expenses of a Witness.  Notwithstanding any other provision of this Agreement, to the fullest extent permitted by applicable law and to the extent that Executive is, by reason of his Corporate Status, a witness in any Proceeding to which Executive is not a party, he shall be indemnified by the Indemnitors against all Expenses actually and reasonably incurred by him or on his behalf in connection therewith.

          Section 6.     Additional Indemnification.

	 	
(a)
	
Notwithstanding any limitation in Sections 3 or 4, the Corporation shall 

	
indemnify Executive to the fullest extent permitted by applicable law if Executive is a party to or threatened to be made a party to any Proceeding (including a Proceeding by or in the right of the Corporation to procure a judgment in its favor) against all Losses of Executive in connection with the Proceeding.

	 

 

 

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(b)
	
For purposes of this Agreement, the meaning of the phrase "to the fullest 

	
extent permitted by applicable law" shall include the following:

	 
	 	
(i)
	
with respect to the Corporation:

	 
	 	
(A)
	
to the fullest extent permitted by the provisions of 

	
Maryland law that authorize, permit or contemplate additional indemnification by agreement, or the corresponding provisions of any amendment to or replacement of such provisions of Maryland law; and

	 
	 	
(B)
	
to the fullest extent authorized or permitted by any 

	
amendments to or replacements of such provisions of Maryland law adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its officers and directors.

	 
	 	
(ii)
	
with respect to the Operating Partnership:

	 	 	 
	 	 	
(A)
	
to the fullest extent permitted by the provisions of 

	
Delaware law that authorize, permit or contemplate additional indemnification by agreement, or the corresponding provisions of any amendment to or replacement of such provisions of Delaware law; and

	 
	 	
(B)
	
to the fullest extent authorized or permitted by any 

	
amendments to or replacements of such provisions of Delaware law adopted after the date of this Agreement that increase the extent to which a corporation may indemnify its officers and directors.

	 

          Section 7.     Exclusions.  Notwithstanding any provision in this Agreement, neither of the Indemnitors shall be obligated under this Agreement to make any indemnity or advance in connection with any claim made against Executive:

	 	
(a)
	
for which payment has actually been made to or for the account of 

	
Executive under any insurance policy, other indemnity provision, contract or agreement, except with respect to any excess beyond the amount paid to Executive under any insurance policy, other indemnity provision, contract or agreement;

	 	 	 
	 	
(b)
	
for (i) an accounting of profits made from the purchase and sale (or sale 

	
and purchase) by Executive of securities of the Corporation that did, in fact, violate Section 16(b) of the Exchange Act or (ii) any reimbursement of the Corporation by Executive of any bonus or other incentive-based or equity-based compensation or of any profits realized by Executive from the sale of securities of the Corporation, as required in each case under the Exchange Act;

	 	 	 

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(c)
	
except as otherwise provided in Section 12(d) of this Agreement, in 

	
connection with any Proceeding (or any part of any Proceeding) initiated by Executive, including any Proceeding (or any part of any Proceeding) initiated by Executive against the Corporation or its directors, officers or employees, unless (i) the Board of Directors of the Corporation authorized the Proceeding (or any part of any Proceeding) prior to its initiation, or (ii) the Corporation provides the indemnification, in its sole discretion, pursuant to the powers vested in the Corporation under applicable law; or

	 	 	 
	 	
(d)
	
in the event that the Indemnitors are advised, in a written opinion of their 

	
regular outside legal counsel, that their performance of any provision of this Agreement would violate Section 13(k) of the Exchange Act, then the parties agree to revise and replace such provision in a manner that will result in a new provision that does not violate such provision and the legal effect of which comes as close as possible to what the parties had intended to achieve with the original provision.

	 

          Section 8.     Advances of Expenses.  In keeping with the Prior Agreement, and notwithstanding any provision of this Agreement to the contrary, the Indemnitors shall advance, to the extent not prohibited by law, the Expenses incurred by Executive (or reasonably expected to be incurred by Executive during the six months following any such request) in connection with any Proceeding, and such advancement shall be made within 30 days after the receipt by the Indemnitors of a statement or statements requesting such advances from time to time, whether prior to or after final disposition of any Proceeding.  Advances shall be unsecured and interest free.  Advances shall be made without regard to Executive's ability to repay the amounts advanced and without regard to Executive's ultimate entitlement to indemnification under the other provisions of this Agreement.  Advances shall include any and all reasonable Expenses incurred pursuing an action to enforce this right of advancement, including Expenses incurred preparing and forwarding statements to the Indemnitors to support the advances claimed.  The Executive shall qualify for advances from the Operating Partnership upon the execution and delivery to the Indemnitors of this Agreement, which shall constitute an undertaking providing that Executive undertakes to repay the advance to the extent that it is ultimately determined that Executive is not entitled to be indemnified by the Operating Partnership.  To qualify for advances from the Corporation, Executive must execute and deliver to the Corporation (a) a written undertaking providing that Executive undertakes to repay the advance to the Corporation to the extent that it is ultimately determined that Executive is not entitled to be indemnified by the Corporation and (b) a written affirmation by Executive of Executive's good faith belief that the standard of conduct necessary for indemnification by the Corporation as authorized by Maryland law and this Agreement has been met.  This Section 8 shall not apply to any claim made by Executive for which indemnity is excluded pursuant to Section 7.

 

 

 

 

 

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          Section 9.     Procedure for Notification and Defense of Claim.

	 	
(a)
	
Executive shall notify the Indemnitors in writing of any matter with 

	
respect to which Executive intends to seek indemnification or advancement of Expenses hereunder as soon as reasonably practicable following the receipt by Executive of written notice thereof.  The written notification to the Indemnitors shall include a description of the nature of the Proceeding and the facts underlying the Proceeding.  To obtain indemnification under this Agreement, Executive shall submit to the Indemnitors a request, including therein or therewith such documentation and information as is reasonably available to Executive and is reasonably necessary to determine whether and to what extent Executive is entitled to indemnification following the final disposition of such action, suit or proceeding.  The omission by Executive to notify the Indemnitors hereunder will not relieve the Indemnitors from any liability which they may have to Executive hereunder or otherwise than under this Agreement, and any delay in so notifying the Indemnitors shall not constitute a waiver by Executive of any rights under this Agreement.  The Secretary of the Corporation shall, promptly upon receipt of such a request for indemnification, advise the Board and the General Partner in writing that Executive has requested indemnification.

	 	 	 
	 	
(b)
	
Each of the Indemnitors will be entitled to participate in the Proceeding 

	
at its own expense.

	
	
	

          Section 10.     Procedure Upon Application for Indemnification.  

	 	
(a)
	
Upon written request by Executive for indemnification pursuant to the 

	
first sentence of Section 9(a), a determination, if required by applicable law or this Agreement, with respect to Executive's entitlement thereto shall be made in the specific case:  

	 	 	 	 	 
	 	 	
(i)
	
if a Change in Control shall have occurred, by Independent 

	
Counsel selected in accordance with Section 10(b) in a written opinion to the Board, a copy of which shall be delivered to Executive; or

	 	 	 	 	 
	 	 	
(ii)
	
if a Change in Control shall not have occurred, in the following 

	
manner:  

	 	 	 	 	 
	 	 	 	
(A)
	
by the Board acting by majority vote of  a quorum of 

	
Disinterested Directors; or

	 	 	 	 	 
	 	 	 	
(B)
	
if such a quorum is not obtainable or, even if obtainable, 

	
a quorum of Disinterested Directors, acting by majority vote, so directs, (x) by the Board upon the opinion in writing of Independent Counsel selected in accordance with Section 10(b), or (y) by the shareholders of the Corporation.

	 	 	 	 	 

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If it is so determined that Executive is entitled to indemnification, payment to Executive shall be made within ten days after such determination.  Executive shall cooperate with the person, persons or entity making such determination with respect to Executive's entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation or information that is not privileged or otherwise protected from disclosure and that is reasonably available to Executive and reasonably necessary to such determination.  Any costs or expenses (including attorneys' fees and disbursements) incurred by Executive in so cooperating with the person, persons or entity making such determination shall be borne by the Indemnitors (irrespective of the determination as to Executive's entitlement to indemnification) and the Indemnitors hereby indemnifies and agrees to hold Executive harmless therefrom.

	 	
(b)
	
In the event the determination of entitlement to indemnification is to be 

	
made by Independent Counsel pursuant to Section 10(a) hereof, the Independent Counsel shall be selected as provided in this Section 10(b).  If a Change in Control shall not have occurred, the Independent Counsel shall be selected by the Board, and the Corporation shall give written notice to Executive advising him of the identity of the Independent Counsel so selected.  If a Change in Control shall have occurred, the Independent Counsel shall be selected by Executive (unless Executive shall request that such selection be made by the Board, in which event the preceding sentence shall apply), and Executive shall give written notice to the Corporation advising it of the identity of the Independent Counsel so selected.  In either event, Executive or the Corporation, as the case may be, may, within ten days after such written notice of selection shall have been given, deliver to the Corporation or to Executive, as the case may be, a written objection to such selection; provided, however, that such objection may be asserted only on the ground that the Independent Counsel so selected does not meet the requirements of "Independent Counsel" as defined in Section 2, and the objection shall set forth with particularity the factual basis of such assertion.  Absent a proper and timely objection, the person so selected shall act as Independent Counsel.  If such written objection is so made, the Independent Counsel so selected may not serve as Independent Counsel unless and until such objection is withdrawn or a court or an arbitrator has determined that such objection is without merit.  If, within 20 days after the later of submission by Executive of a written request for indemnification pursuant to Section 10(a) hereof and the final disposition of the Proceeding, no Independent Counsel shall have been selected and not objected to, either the Corporation or Executive may petition a court of competent jurisdiction or commence an arbitration before a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association for resolution of any objection that shall have been made by the Corporation or Executive to the other's selection of Independent Counsel or for the appointment as Independent Counsel of a person selected by such court or arbitrator or by such other person as such court or arbitrator shall designate, and the person with respect to whom all objections are so resolved or the person so appointed shall act as Independent Counsel under Section 10(a) hereof.  Upon the due commencement of any judicial proceeding or arbitration pursuant to Section 12(a), Independent Counsel shall be discharged and relieved of any further responsibility in such capacity (subject to the applicable standards of professional conduct then prevailing).

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          Section 11.     Presumptions and Effect of Certain Proceedings.

	 	
(a)
	
In making a determination with respect to entitlement to indemnification  

	
hereunder, the person or entity making such determination shall, to the fullest extent permitted by law, presume that Executive is entitled to indemnification under this Agreement if Executive has submitted a request for indemnification in accordance with Section 9(a), and the Indemnitors shall, to the fullest extent permitted by law, have the burden of proof, by clear and convincing evidence, to overcome that presumption in connection with the making by any person, persons or entity of any determination contrary to that presumption.  Neither the failure of the Corporation (including by its directors or Independent Counsel) to have made a determination prior to the commencement of any action or arbitration pursuant to this Agreement that indemnification is proper in the circumstances because indemnification of Executive is not barred pursuant to the provisions of this Agreement or otherwise, nor an actual determination by the Corporation (including by its directors or Independent Counsel) that indemnification of Executive is barred pursuant to the provisions of this Agreement or otherwise, shall be a defense to such action or arbitration or create a presumption that Executive is not entitled to indemnification.  The termination of any Proceeding or any claim, issue or matter therein by judgment, settlement, conviction or upon a plea of nolo contendere, or its equivalent, shall not create a presumption that Executive engaged in Disqualifying Conduct.

	 	 	 
	 	
(b)
	
Subject to Section 12(e), if the person, persons or entity empowered or 

	
selected under Section 10 to determine whether Executive is entitled to indemnification shall not have made a determination within 60 days (or 30 days if the request was for an advance) after receipt by the Indemnitors of the request therefor, the requisite determination of entitlement to indemnification shall, to the fullest extent permitted by law, be deemed to have been made and Executive shall be entitled to such indemnification, absent (i) a misstatement by Executive of a material fact, or an omission of a material fact necessary to make Executive's statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law; provided, however, that such 60-day period may be extended for a reasonable time, not to exceed an additional 30 days, if the person, persons or entity making the determination with respect to entitlement to indemnification in good faith requires such additional time for the obtaining or evaluating of documentation or information relating thereto; and provided, further, that the foregoing provisions of this Section 11(b) shall not apply (i) if the determination of entitlement to indemnification is to be made by the shareholders pursuant to Section 10(a) and if (A) within 15 days after receipt by the Indemnitors of the request for such determination the Board of Directors has resolved to submit such determination to the shareholders for their consideration at an annual meeting thereof to be held within 75 days after such receipt and such determination is made thereat, or (B) a special meeting of shareholders is called within 15 days after such receipt for the purpose of making such determination, such meeting is held for such purpose within 60 days after having been so called and such determination is made thereat, or (ii) if the determination of entitlement to indemnification is to be made by Independent Counsel pursuant to Section 10(a).

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(c)
	
For purposes of any determination of whether Executive acted in bad 

	
faith, Executive shall be deemed to have acted in good faith if Executive acted in reliance on the records or books of account of a Covered Entity, including financial statements, or on information supplied to Executive by the officers of a Covered Entity in the course of their duties, or on the advice of legal counsel for the Covered Entity or on information or records given or reports made to the Covered Entity by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Covered Entity.  The provisions of this Section 11(c) shall not be deemed to be exclusive or to limit in any way the other circumstances in which Executive may be deemed to be entitled to indemnification.

	 	 	 
	 	
(d)
	
A person who acted in good faith and in a manner he reasonably 

	
believed to be in the best interests of the participants and beneficiaries of an employee benefit plan shall be deemed not to have acted in "bad faith" as referred to in this Agreement.

	 	 	 
	 	
(e)
	
The knowledge or actions, or failure to act, of any director, officer, 

	
agent or employee of the Covered Entity shall not be imputed to Executive for purposes of determining the right to indemnification under this Agreement.

	 	 	 

          Section 12.    Remedies of Executive.

	 	
(a)
	
Subject to Section 12(c), in the event that (i) a determination is made 

	
pursuant to Section 10 that Executive is not entitled to indemnification under this Agreement, (ii) advancement of Expenses is not timely made pursuant to Section 8, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 10(a) within 90 days (or 30 days if the request was for an advance) after receipt by the Indemnitors of the request for indemnification, (iv) payment of indemnification is not made pursuant to Section 4 or 5 or the last sentence of Section 10(a)  within ten days after receipt by the Indemnitors of a written request therefor, or (v) payment of indemnification pursuant to Section 3 or 6 is not made within ten days after a determination has been made that Executive is entitled to indemnification, Executive shall be entitled to an adjudication by a court of his entitlement to such indemnification or advancement of Expenses.  Alternatively, Executive, at his option, may seek an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration Association.  Executive shall commence such proceeding seeking an adjudication or an award in arbitration within 180 days following the date on which Executive first has the right to commence such proceeding pursuant to this Section 12(a); provided, however, that the foregoing clause shall not apply in respect of a proceeding brought by Executive to enforce his rights under Section 5.  The Indemnitors shall not oppose Executive's right to seek any such adjudication or award in arbitration.

	 	 	 
	 	
(b)
	
In the event that a determination shall have been made pursuant to 

	
Section 10(a) that Executive is not entitled to indemnification, any judicial proceeding or arbitration commenced pursuant to this Section 12 shall be conducted in all respects as a de novo

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trial, or arbitration, on the merits and Executive shall not be prejudiced by reason of that adverse determination.  In any judicial proceeding or arbitration commenced pursuant to this Section 12 the Indemnitors shall have the burden of proving by clear and convincing evidence that Executive is not entitled to indemnification or advancement of Expenses, as the case may be.

	 	 	 
	 	
(c)
	
If a determination shall have been made pursuant to Section 10(a) that 

	
Executive is entitled to indemnification, the Indemnitors shall be bound by such determination in any judicial proceeding or arbitration commenced pursuant to this Section 12, absent (i) a misstatement by Executive of a material fact, or an omission of a material fact necessary to make Executive's statement not materially misleading, in connection with the request for indemnification, or (ii) a prohibition of such indemnification under applicable law.

	 	 	 
	 	
(d)
	
The Indemnitors shall, to the fullest extent permitted by law, be 

	
precluded from asserting in any judicial proceeding or arbitration commenced pursuant to this Section 12 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and shall stipulate in any such court or before any such arbitrator that the Indemnitors are bound by all the provisions of this Agreement.  It is the intent of the Indemnitors that Executive not be required to incur legal fees or other Expenses associated with the interpretation, enforcement or defense of Executive's rights under this Agreement by litigation or otherwise because the cost and expense thereof would substantially detract from the benefits intended to be extended to Executive hereunder.  The Indemnitors shall indemnify Executive against any and all Expenses and, if requested by Executive, shall (within 10 days after receipt by the Indemnitors of a written request therefor) advance, to the extent not prohibited by law, such expenses to Executive, which are incurred by Executive in connection with any action brought by Executive for indemnification or advance of Expenses from the Indemnitors under this Agreement or under any directors' and officers' liability insurance policies maintained by the Indemnitors, regardless of whether Executive ultimately is determined to be entitled to such indemnification, advancement of Expenses or insurance recovery, as the case may be.

	 	 	 
	 	
(e)
	
Notwithstanding anything in this Agreement to the contrary, no 

	
determination as to entitlement to indemnification under this Agreement shall be required to be made prior to the final disposition of the Proceeding, whether by settlement or otherwise.

	 	 	 
	 	
(f)
	
During the interval between the Indemnitors' receipt of Executive's 

	
request for indemnification and the later to occur of (a) payment in full to Executive of such indemnification, or (b) a final determination (if required) pursuant to Sections 10 and 11 that Executive is not entitled to indemnification, the Indemnitors shall protect Executive against loss which, for purposes of this Agreement, shall mean the taking of the necessary steps (regardless of whether such steps require expenditures to be made by the Indemnitors at that time) to stay, pending a final determination of Executive's entitlement to indemnification (and, if Executive is so entitled, the payment thereof), the execution, enforcement or collection of any judgments, penalties, fines (including any excise tax assessed with respect to any employee benefit plan) or 

- 13 -

<PAGE>

	
any other amounts for which Executive may be liable in order to avoid his being or becoming in default with respect to any such amounts (such necessary steps to include, but not be limited to, the procurement of a surety bond to achieve such stay), within five business days after receipt of Executive's written request therefor, together with a written undertaking by Executive to repay, no later than 60 days following receipt of a statement therefor from the Indemnitors, amounts (if any) expended by the Indemnitors for such purpose, if it is ultimately determined (if such determination is required) pursuant to Sections 10 and 11 that Executive is not entitled to be indemnified against such judgments, penalties, fines (including any excise tax assessed with respect to any employee benefit plan) or other amounts.

	 	 	 

          Section 13.    Non-exclusivity; Survival of Rights; Insurance; Subrogation.

	 	
(a)
	
The rights of indemnification and to receive advancement of Expenses 

	
as provided by this Agreement shall not be deemed exclusive of any other rights to which Executive may at any time be entitled under applicable law, the Corporation's charter, the Corporation's By-laws, the Agreement of Limited Partnership of the Operating Partnership, the organizational and governing documents of any Covered Entity, any agreement, a vote of shareholders or a resolution of directors, or otherwise.  No amendment, alteration or repeal of this Agreement or of any provision hereof shall limit or restrict any right of Executive under this Agreement in respect of any action taken or omitted by such Executive in his Corporate Status prior to such amendment, alteration or repeal.  To the extent that a change in Maryland law or Delaware law, as applicable, whether by statute or judicial decision, permits greater indemnification or advancement of Expenses than would be afforded currently under the Corporation's charter and By-laws, the Agreement of Limited Partnership of the Operating Partnership and this Agreement, as applicable, it is the intent of the parties hereto that Executive shall enjoy by this Agreement the greater benefits so afforded by such change.  No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right and remedy shall be cumulative and in addition to every other right and remedy given hereunder or now or hereafter existing at law or in equity or otherwise.  The assertion or employment of any right or remedy hereunder, or otherwise, shall not prevent the concurrent assertion or employment of any other right or remedy.

	 	 	 
	 	
(b)
	
To the extent that either of the Indemnitors maintains an insurance 

	
policy or policies providing liability insurance for directors, officers, employees, or agents of such Indemnitor or of any other Covered Entity, Executive shall be covered by such policy or policies in accordance with its or their terms to the maximum extent of the coverage available for any such director, officer, employee or agent under such policy or policies.  If, at the time of the receipt of a notice of a claim pursuant to the terms hereof, either of the Indemnitors has director and officer liability insurance in effect, such Indemnitor shall give prompt notice of the commencement of such proceeding to the insurers in accordance with the procedures set forth in the respective policies.  Such Indemnitor shall thereafter take all necessary or desirable action to cause such insurers to pay, on behalf of Executive, all amounts payable as a result of such proceeding in accordance with the terms of such policies.

- 14 -

<PAGE>

	 	 	 
	 	
(c)
	
In the event of any payment under this Agreement, the Indemnitors shall 

	
be subrogated to the extent of such payment to all of the rights of recovery of Executive, who shall execute all papers required and take all action necessary to secure such rights, including execution of such documents as are necessary to enable the Indemnitors to bring suit to enforce such rights.

	 	 	 

          Section 14.     Contribution.  To the fullest extent permissible under applicable law, if the indemnification provided for in this Agreement is unavailable to Executive for any reason whatsoever, then the Indemnitors, in lieu of indemnifying Executive, shall contribute to the Losses incurred by Executive in connection with any claim relating to an indemnifiable event under this Agreement, in such proportion as is deemed fair and reasonable in light of all of the circumstances of such Proceeding in order to reflect (a) the relative benefits received by the Covered Entities (and their directors, officers, employees and agents other than Executive), on one hand, and Executive, on the other hand, as a result of the events or transactions giving cause to such Proceeding, or (b) if the allocation described in clause (a) above is not permitted by applicable law, the relative fault of the Covered Entities (and their directors, officers, employees and agents other than Executive), on one hand, and Executive , on the other hand, in connection with such events or transactions.  The relative fault of the Covered Entities (and their directors, officers, employees and agents other than Executive), on one hand, and Executive, on the other hand, in connection with the events or transactions giving cause to such Proceeding shall be determined by reference to, among other things, the degree to which their actions were motivated by intent to gain personal profit or advantage, the degree to which their liability is primary or secondary, and the degree to which their conduct is active or passive.  The relative benefits received by the Covered Entities (and their directors, officers, employees and agents other than Executive), on one hand, and Executive, on the other hand, in connection with the events or transactions giving cause to such Proceeding shall be limited to direct and indirect financial benefits actually derived by the applicable person, his designees or his intended beneficiaries from the action or inaction in connection with the events or transactions giving cause to such Proceeding, and shall not include any non-financial benefits or any benefits that were not actually received by the applicable person, his designees or his intended beneficiaries.

          Section 15.     Joint and Several Obligations.  The obligations of the Corporation and the Operating Partnership under this Agreement shall be joint and several.

          Section 16.     Retroactive Effect; Binding Agreement.  

	 	
(a)
	
All agreements and obligations of the Indemnitors contained herein shall 

	
commence upon the date that Executive first became an officer of the Corporation, shall continue during the period of Executive's Corporate Status and shall continue thereafter so long as Executive shall be subject to any possible Proceeding by reason of Executive's Corporate Status.  In this regard, the provisions contained herein are intended to be retroactive and the full benefits hereof shall be available in respect of any alleged or actual occurrences, acts or failures to act that occurred prior to the date hereof.

- 15 -

<PAGE>

	 	 	 
	 	
(b)
	
This Agreement shall be binding upon the Indemnitors and their 

	
respective successors and assigns.  The Corporation shall require any successor (whether direct or indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the business or assets of the Corporation or the Operating Partnership, by agreement in form and substance reasonably satisfactory to Executive, expressly to assume and agree to perform this Agreement in the same manner and to the same extent that the Indemnitors would be required to perform if no such succession had taken place.  To the extent that either of the Indemnitors maintains one or more insurance policies providing liability insurance for the directors and officers of the Corporation, upon any Change of Control, such Indemnitor shall use commercially reasonable efforts to obtain or arrange for continuation or "tail" coverage for Executive to the maximum extent obtainable at such time.

	 	 	 
	 	
(c)
	
This Agreement shall inure to the benefit of and be enforceable by 

	
Executive's personal or legal representatives, executors, administrators, successors, heirs, distributees, devisees and legatees.  Without limiting the generality of the preceding sentence, if Executive should die while any amounts would still be payable to him hereunder if he had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to Executive's devisee, legatee, or other designee, or if there be no such designee, to his estate.

	 	 	 

          Section 17.     Severability; Invalidity.  If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever (i) the validity, legality and enforceability of the remaining provisions of this Agreement (including each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable to the fullest extent permitted by law, (ii) such provision or provisions shall be deemed reformed to the extent necessary to conform to applicable law and to give the maximum effect to the intent of the parties hereto, and (iii) to the fullest extent possible, the provisions of this Agreement (including each portion of any Section of this Agreement containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable) shall be construed so as to give effect to the intent manifested thereby.  If this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever, then the Prior Agreement shall remain binding upon the Corporation and Executive and enforceable by each of the Corporation and Executive in accordance with its terms without amendment, restatement or any other change as a result of the execution and delivery of this Agreement.

          Section 18.     Entire Agreement.

	 	
(a)
	
Each of the Indemnitors expressly confirm and agree that it has 

	
entered into this Agreement and assumed the obligations imposed on it hereby in order to induce Executive to continue to serve as an officer of the Corporation, and each of the 

- 16 -

<PAGE>

	
Indemnitors acknowledges that Executive is relying upon this Agreement in serving as an officer of the Corporation and having Corporate Status with respect to any Covered Entity.

	 	 	 
	 	
(b)
	
This Agreement constitutes the entire agreement between the parties 

	
hereto with respect to the subject matter hereof and supersedes all prior agreements and understandings, oral, written and implied, between the parties hereto with respect to the subject matter hereof; provided, however, that this Agreement is a supplement to and in furtherance of the charter of the Corporation, the By-laws of the Corporation, the Agreement of Limited Partnership of the Operating Partnership and applicable law, and shall not be deemed a substitute therefor, nor to diminish or abrogate any rights of Executive thereunder.

	 	 	 

          Section 19.     Modification and Waiver.  No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by the parties thereto.  No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions of this Agreement nor shall any waiver constitute a continuing waiver.

          Section 20.     Notice by Executive.  Executive agrees promptly to notify the Indemnitors in writing upon being served with any summons, citation, subpoena, complaint, indictment, information or other document relating to any Proceeding or matter which may be subject to indemnification or advancement of Expenses covered hereunder.  The failure of Executive to so notify the Indemnitors shall not relieve the Indemnitors of any obligation which it may have to Executive under this Agreement or otherwise. 

          Section 21.     Notices.  All notices, requests, demands and other communications under this Agreement shall be in writing and shall be deemed to have been duly given if (a) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, (b) mailed by certified or registered mail with postage prepaid, on the third business day after the date on which it is so mailed, (c) mailed by reputable overnight courier and receipted for by the party to whom said notice or other communication shall have been directed or (d) sent by facsimile transmission, with receipt of oral confirmation that such transmission has been received:

	 	 	
(i)
	
If to Executive, at the address or fax number indicated on the 

	
signature page of this Agreement, or such other address as Executive shall provide to the Indemnitors; and

	 	 	 	 
	 	 	
(ii)
	
If to the Indemnitors, at the address or fax number for each 

	
Indemnitor indicated on the signature page of this Agreement, or at such other address or fax number as may have been furnished to Executive by such Indemnitor.

	 	 	 	 

 

- 17 -

<PAGE>

          Section 22.     Applicable Law and Consent to Jurisdiction.  This Agreement and the legal relations among the parties shall be governed by, and construed and enforced in accordance with, the laws of the State of Maryland, without regard to its conflict of laws rules. Except with respect to any arbitration commenced by Executive pursuant to Section 10(b), the Corporation, the Operating Partnership and Executive hereby irrevocably and unconditionally (a) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the courts of the State of Maryland (the "Designated Court"), and not in any other state or federal court in the United States of America or any court in any other country, (b) consent to submit to the exclusive jurisdiction of the Designated Court for purposes of any action or proceeding arising out of or in connection with this Agreement, (c) waive any objection to the laying of venue of any such action or proceeding in the Designated Court, and (d) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Designated Court has been brought in an improper or inconvenient forum.

          Section 23.     Identical Counterparts.  This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to be an original but all of which together shall constitute one and the same Agreement.  Only one such counterpart signed by the party against whom enforceability is sought needs to be produced to evidence the existence of this Agreement.

          Section 24.     Miscellaneous.  Use of the masculine pronoun shall be deemed to include usage of the feminine or neuter pronoun where appropriate.  Use of the plural nouns shall be deemed to include usage of the singular form of such noun where appropriate.  Whenever the words "include," "includes" or "including" are used in this Agreement, they shall be deemed to be followed by the words "without limitation."  Unless otherwise indicated, references in this Agreement to any "Section" shall be deemed to refer to the indicated Section of this Agreement.  The headings set forth in this Agreement are inserted for convenience only and shall not be deemed to constitute part of this Agreement or to affect the construction thereof.

[SIGNATURE PAGE FOLLOWS]

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

- 18 -

<PAGE>

          IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of the day and year first above written.

	
SOVRAN SELF STORAGE, INC.

By:    _________________________________

Name:  Robert J. Attea

Title:    Chairman of the Board

Address:         6467 Main Street

                       Buffalo, NY 14221

Fax Number:  (716) 633-3397
	 
	 	 
	 	 
	
SOVRAN ACQUISITION LIMTED PARTNERSHIP

BY:     SOVRAN HOLDINGS, INC, its general partner

By:    ________________________________

Name:  Robert J. Attea

Title:    Chairman of the Board

Address:         6467 Main Street

                       Buffalo, NY 14221

Fax Number:   (716) 633-3397
	 
	 	 
	 	 
	
EXECUTIVE

By:    ________________________________

Name:  David L. Rogers

Address:

Fax Number:   
	 

 

 

 

 

 

 

 

- 19 -Exhibit 4.1

 

 

 

 

IRON MOUNTAIN INCORPORATED

 

THE GUARANTORS NAMED HEREIN

 

AND

 

THE BANK OF NEW YORK TRUST COMPANY, N.A.,

as Trustee

 

83⁄4% Senior Subordinated Notes due 2018

 

THIRD SUPPLEMENTAL INDENTURE

 

Dated as of July 17, 2006

 

TO

 

SENIOR SUBORDINATED INDENTURE

 

Dated as of December 30, 2002

 

 

 

 

 

 

 

 

TABLE OF CONTENTS

 

 

	
             
 	
            Page
 
	
            ARTICLE 1. DEFINITIONS
 	
            1
 
	
             
 	
             
 
	
            Section 1.1.           Definitions.
 	
            1
 
	
             
 	
             
 
	
            ARTICLE 2. FORM AND TERMS OF THE NOTES
 	
            15
 
	
             
 	
             
 
	
            Section 2.1.           Form and Dating
 	
            15
 
	
            Section 2.2.           Execution and Authentication
 	
            16
 
	
            Section 2.3.           Depository and Paying Agent for Notes
 	
            16
 
	
            Section 2.4.           Transfer and Exchange of Notes
 	
            16
 
	
            Section 2.5.           Redemption
 	
            18
 
	
            Section 2.6.           Additional Covenants
 	
            21
 
	
            (a)      Restricted Payments
 	
            21
 
	
            (b)      Incurrence of Indebtedness and Issuance of Preferred Stock
 	
            24
 
	
            (c)      Liens
 	
            25
 
	
            (d)      Dividend and Other Payment Restrictions Affecting 
                                                                  Restricted Subsidiaries
 	
            25
 
	
            (e)      Transactions with Affiliates
 	
            26
 
	
            (f)       Certain Senior Subordinated Debt
 	
            27
 
	
            (g)      Additional Subsidiary Guarantees
 	
            27
 
	
            (h)      Designation of Unrestricted Subsidiaries
 	
            28
 
	
            (i)       Limitation on Sale and Leaseback Transactions
 	
            29
 
	
            (j)       Asset Sales
 	
            29
 
	
            (k)      Change of Control Offer
 	
            31
 
	
            (l)       Changes in Covenants When Notes Rated Investment Grade
 	
            33
 
	
            Section 2.7.           Subsidiary Guarantees
 	
            33
 
	
            Section 2.8.           Legal Defeasance and Covenant Defeasance
 	
            34
 
	
            Section 2.9.           Subordination
 	
            34
 
	
            Section 2.10.        Amend, Restate and Replace Covenant Regarding Reports
 	
            34
 
	
            Section 2.11.        Events of Default
 	
            35
 
	
             
 	
             
 
	
            ARTICLE 3. MISCELLANEOUS
 	
            35
 
	
             
 	
             
 
	
            Section 3.1.           Effect of Headings
 	
            35
 
	
            Section 3.2.           Successors and Assigns
 	
            35
 
	
            Section 3.3.           Separability Clause
 	
            35
 
	
            Section 3.4.           Governing Law
 	
            35
 
	
            Section 3.5.           Third Supplement to Supersede Indenture
 	
            35
 

 

EXHIBITS

 

	
            Exhibit A
 	
            FORM OF NOTES
 	
             

	
            Exhibit B
 	
            FORM OF SUPPLEMENTAL INDENTURE
 

 

 

 

 

THIS THIRD SUPPLEMENTAL INDENTURE, dated as of July 17, 2006 (“Third Supplemental Indenture”), is by and between IRON MOUNTAIN INCORPORATED, a Delaware corporation (the “Company”), having its principal office at 745 Atlantic Avenue, Boston, Massachusetts 02111, the Guarantors signatory hereto, and THE BANK OF NEW YORK TRUST COMPANY, N.A., a national banking association, as trustee (the “Trustee”), having its principal corporate trust office at 222 Berkeley Street, 2nd Floor, Boston, MA  02116.

WITNESSETH:

WHEREAS, the Company and the Trustee, as successor trustee, are parties to that certain Senior Subordinated Indenture, dated as of December 30, 2002 (the “Indenture”), to provide for the issuance by the Company from time to time of Securities to be issued in one or more series as provided in the Indenture;

WHEREAS, the issuance and sale of up to $300,000,000 aggregate principal amount of a series of the Company’s Securities (the “Notes”) have been authorized by resolutions adopted by the Board of Directors of the Company on June 19, 2006;

WHEREAS, the Company desires to issue and sell $200,000,000 aggregate principal amount of the Notes on the date hereof;

WHEREAS, the Company desires to enter into this Third Supplemental Indenture pursuant to Section 9.1(e) of the Indenture to supplement the Indenture to establish the form and terms of the Notes; and

NOW, THEREFORE, for and in consideration of the premises stated herein and the purchase of the Notes by the Holders thereof, the parties hereto hereby enter into this Third Supplemental Indenture, for the equal and proportionate benefit of all Holders of Notes, as follows:

ARTICLE 1.

 

DEFINITIONS

	
            Section 1.1.
 	
            Definitions.
 

(a)          All of the terms used in this Third Supplemental Indenture that are defined in the Indenture shall have the meanings specified in the Indenture, unless otherwise defined herein (in which case they shall have the meanings defined herein for the purposes of the Indenture as well as for the Third Supplemental Indenture) or unless the context otherwise requires, and for the purposes of this Third Supplemental Indenture, the following terms have the meanings set forth in this Section:

“Acquired Debt” means, with respect to any specified Person: 

	
             
 	
            (1)
 	
            Indebtedness of any other Person, existing at the time such other Person merged with or into or became a Subsidiary of such specified Person, including Indebtedness incurred in connection with, or in contemplation of, such other Person merging with or into or becoming a Subsidiary of such specified Person; and 
 

	
             
 	
            (2)
 	
            Indebtedness encumbering any asset acquired by such specified Person. 
 

 

 

 

 

 

“Acquisition EBITDA” means, as of any date of determination, with respect to an Acquisition EBITDA Entity, the sum of: 

	
             
 	
            (1)
 	
            EBITDA of such Acquisition EBITDA Entity for the most recently ended four full quarters for which internal financial statements are available at such date of determination (adjusted to give pro forma effect to any acquisition or disposition of a business or Person by such Acquisition EBITDA Entity consummated during the period covered by, or after the date of, such four full fiscal quarters (or if statements are not available for such four full fiscal quarters, EBITDA for the most recently ended fiscal quarter for which internal financial statements are available, annualized), plus 
 

	
             
 	
            (2)
 	
            projected quantifiable improvements in operating results (on an annualized basis) due to cost reductions calculated in good faith by the Company or one of its Restricted Subsidiaries, as certified by an Officers’ Certificate filed with the Trustee, without giving effect to any operating losses of the acquired Person. 
 

“Acquisition EBITDA Entity” means, as of any date of determination, a business or Person: 

	
             
 	
            (1)
 	
            which has been acquired by the Company or one of its Restricted Subsidiaries and with respect to which internal financial statements on a consolidated basis with the Company are not available for four full fiscal quarters; or 
 

	
             
 	
            (2)
 	
            which is to be acquired in whole or in part with Indebtedness, the incurrence of which will require the calculation on such date of the Acquisition EBITDA of such Acquisition EBITDA Entity for purposes of Section 2.6(b) of this Third Supplemental Indenture (Section 4.9 of the Indenture).  
 

“Additional Notes” means such amount of the Company’s 83⁄4 % Senior Subordinated Notes due 2018 (other than the Initial Notes) as the Company may issue from time to time under this Third Supplemental Indenture in accordance with Section 2.2 hereof as part of the same series as the Initial Notes.

“Adjusted EBITDA” means, as of any date of determination and without duplication, the sum of: 

	
             
 	
            (1)
 	
            EBITDA of the Company and its Restricted Subsidiaries for the Company’s most recently ended four full fiscal quarters for which internal financial statements are available at such date of determination; and 
 

	
             
 	
            (2)
 	
            Acquisition EBITDA of each business or Person that is an Acquisition EBITDA Entity as of such date of determination, multiplied by a fraction, (i) the numerator of which is 12 minus the number of months (and/or any portion thereof) in such most recent four full fiscal quarters for which the financial results of such Acquisition EBITDA Entity are included in the EBITDA of the Company and its Restricted Subsidiaries under clause (1) above, and (ii) the denominator of which is 12. The effects of unusual items, including merger-related expenses permitted to be shown as a separate line item on a statement of operations in accordance with GAAP, or non-recurring items in respect of the Company, a Restricted 
 

 

2

 

 

Subsidiary or an Acquisition EBITDA Entity occurring in any period shall be excluded in the calculation of Adjusted EBITDA. 

“Agent Members” means members of, or participants in, the Depository.

“Attributable Indebtedness” in respect of a Sale and Leaseback Transaction means, as of the time of determination, the greater of: 

	
             
 	
            (1)
 	
            the fair market value of the property subject to such arrangement (as determined by the Board of Directors); and 
 

	
             
 	
            (2)
 	
            the present value (discounted at the rate of interest implicit in such transaction) of the total obligations of the lessee for rental payments during the remaining terms of the lease included in such Sale and Leaseback Transaction (including any period for which such lease has been extended). 
 

 “Cash Equivalents” means: 

	
             
 	
            (1)
 	
            securities with maturities of one year or less from the date of acquisition, issued, fully guaranteed or insured by the United States Government or any agency thereof; 
 

	
             
 	
            (2)
 	
            certificates of deposit, time deposits, overnight bank deposits, bankers acceptances and repurchase agreements issued by a Qualified Issuer having maturities of 270 days or less from the date of acquisition; 
 

	
             
 	
            (3)
 	
            commercial paper of an issuer rated at least A-2 by Standard & Poor’s Rating Group, a division of McGraw Hill, Inc., or P-2 by Moody’s Investors Service, or carrying an equivalent rating by a nationally recognized rating agency if both of the two named rating agencies cease publishing ratings of investments and having maturities of 270 days or less from the date of acquisition; 
 

	
             
 	
            (4)
 	
            money market accounts or funds with or issued by Qualified Issuers; and 
 

	
             
 	
            (5)
 	
            Investments in money market funds substantially all of the assets of which are comprised of securities and other obligations of the types described in clauses (1) through (3) above. 
 

“Change of Control” means the occurrence of any of the following events: 

	
             
 	
            (1)
 	
            any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than the Principal Stockholders (or any of them), is or becomes the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than a majority of the voting power of all classes of Voting Stock of the Company; 
 

	
             
 	
            (2)
 	
            the Company consolidates with, or merges with or into, another Person or conveys, transfers, leases or otherwise disposes of all or substantially all of its assets to any Person, or any Person consolidates with, or merges with or into, the Company, in any such event pursuant to a transaction in which the outstanding Voting Stock of the Company is converted into or exchanged for cash, securities 
 

 

3

 

 

or other property, other than any such transaction where (i) the outstanding Voting Stock of the Company is not converted or exchanged at all (except to the extent necessary to reflect a change in the jurisdiction of incorporation) or is converted into or exchanged for (A) Voting Stock (other than Disqualified Stock) of the surviving or transferee Person or (B) cash, securities and other property (other than Capital Stock described in the foregoing clause (A)) of the surviving or transferee Person in an amount that could be paid as a Restricted Payment pursuant to Section 2.6(a) of the Third Supplemental Indenture (Section 4.8 of the Indenture) and (ii) immediately after such transaction, no “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than the Principal Stockholders (or any of them), is
the “beneficial owner” (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of more than a majority of the total outstanding Voting Stock of the surviving or transferee Person; 

	
             
 	
            (3)
 	
            during any consecutive two-year period, individuals who at the beginning of such period constituted the Board of Directors (together with any new directors whose election to such Board of Directors, or whose nomination for election by the stockholders of the Company, was approved by a vote of 662/3% of the directors then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors then in office; or 
 

	
             
 	
            (4)
 	
            the Company is liquidated or dissolved or adopts a plan of liquidation or dissolution other than in a transaction which complies with Section 5.1 of the Indenture.
 

“Consolidated Adjusted Net Income” means, for any period, the net income (or net loss) of the Company and its Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with GAAP, adjusted to the extent included in calculating such net income or loss by excluding: 

	
             
 	
            (1)
 	
            any net after-tax extraordinary gains or losses (less all fees and expenses relating thereto); 
 

	
             
 	
            (2)
 	
            any net after-tax gains or losses (less all fees and expenses relating thereto) attributable to Asset Sales; 
 

	
             
 	
            (3)
 	
            the portion of net income (or loss) of any Person (other than the Company or a Restricted Subsidiary), including Unrestricted Subsidiaries, in which the Company or any Restricted Subsidiary has an ownership interest, except to the extent of the amount of dividends or other distributions actually paid to the Company or any Restricted Subsidiary in cash dividends or distributions by such Person during such period; and 
 

	
             
 	
            (4)
 	
            the net income (or loss) of any Person combined with the Company or any Restricted Subsidiary on a “pooling of interests” basis attributable to any period prior to the date of combination. 
 

 

4

 

 

 

“Consolidated Income Tax Expense” means, for any period, the provision for federal, state, local and foreign income taxes of the Company and its Restricted Subsidiaries for such period as determined on a consolidated basis in accordance with GAAP. 

“Consolidated Interest Expense” means, for any period, without duplication, the sum of: 

	
             
 	
            (1)
 	
            the amount which, in conformity with GAAP, would be set forth opposite the caption “interest expense” (or any like caption) on a consolidated statement of operations of the Company and its Restricted Subsidiaries for such period, including, without limitation: 
 

	
             
 	
            (i)
 	
            amortization of debt discount; 
 

	
             
 	
            (ii)
 	
            the net cost of interest rate contracts (including amortization of discounts); 
 

	
             
 	
            (iii)
 	
            the interest portion of any deferred payment obligation; 
 

	
             
 	
            (iv)
 	
            amortization of debt issuance costs; and 
 

	
             
 	
            (v)
 	
            the interest component of Capital Lease Obligations of the Company and its Restricted Subsidiaries; plus 
 

	
             
 	
            (2)
 	
            all interest on any Indebtedness of any other Person guaranteed and paid by the Company or any of its Restricted Subsidiaries; 
 

provided, however, that Consolidated Interest Expense will not include any gain or loss from extinguishment of debt, including write-off of debt issuance costs. 

“Consolidated Non-Cash Charges” means, for any period, the aggregate depreciation, amortization and other non-cash expenses of the Company and its Restricted Subsidiaries (including without limitation any minority interest) reducing Consolidated Adjusted Net Income for such period, determined on a consolidated basis in accordance with GAAP (excluding any such non-cash charge to the extent that it requires an accrual of or reserve for cash charges for any future period). 

“Credit Agent” means JPMorgan Chase Bank, in its capacity as administrative agent for the lenders party to the Credit Agreement, or any successor or successors party thereto. 

“Credit Agreement” means that certain Amended and Restated Credit Agreement, dated as of July 8, 2004, as amended, among the Company, the lenders party thereto and the Credit Agent, as amended, restated, supplemented, modified, renewed, refunded, increased, extended, replaced or refinanced from time to time. 

“Definitive Notes” means Notes that are in the form of the Notes attached hereto as Exhibit A, that do not include the information called for by Section 2.15 of the Indenture. 

“EBITDA” means for any period Consolidated Adjusted Net Income for such period increased by: 

	
             
 	
            (1)
 	
            Consolidated Interest Expense for such period; plus 
 

	
             
 	
            (2)
 	
            Consolidated Income Tax Expense for such period; plus 
 

 

5

 

 

 

	
             
 	
            (3)
 	
            Consolidated Non-Cash Charges for such period. 
 

“Equity Interests” means Capital Stock and all warrants, options or other rights to acquire Capital Stock (but excluding any debt security that is convertible into, or exchangeable for, Capital Stock). 

“Equity Proceeds” means: 

	
             
 	
            (1)
 	
            with respect to Equity Interests (or debt securities converted into Equity Interests) issued or sold for cash Dollars, the aggregate amount of such cash Dollars; and 
 

	
             
 	
            (2)
 	
            with respect to Equity Interests (or debt securities converted into Equity Interests) issued or sold for any consideration other than cash Dollars, the aggregate Market Price thereof computed on the date of the issuance or sale thereof. 
 

“Excluded Restricted Subsidiary” means any Restricted Subsidiary organized under the laws of a jurisdiction other than the United States (as defined in Regulation S under the Securities Act) and that has not delivered a Subsidiary Guarantee.

“Existing Indebtedness” means Indebtedness of the Company and its Subsidiaries (other than under the Credit Agreement) in existence on the date of the Indenture, until such amounts are repaid. 

“Global Note” means a permanent global Note that contains the paragraph referred to in Section 2.15.3 of the Indenture and the additional Schedule of Exchanges of Notes to the form of the Note attached hereto as Exhibit A, and that is deposited with and registered in the name of the Depository.

“Initial Notes” means the first $200,000,000 aggregate principal amount of 83⁄4 % Senior Subordinated Notes due 2018 that are issued under this Third Supplemental Indenture, as amended or supplemented from time to time pursuant to the Indenture.

“Investments” means, with respect to any Person, all investments by such Person in other Persons (including Affiliates) in the forms of loans (including Guarantees), advances or capital contributions (excluding commission, travel and similar advances to officers and employees made in the ordinary course of business), purchases or other acquisitions for consideration of Indebtedness, Equity Interests or other securities and all other items that are or would be classified as investments on a balance sheet prepared in accordance with GAAP. 

“Leverage Ratio” means, at any date, the ratio of: 

	
             
 	
            (1)
 	
            the aggregate principal amount of Indebtedness of the Company and its Restricted Subsidiaries outstanding as of the most recent available quarterly or annual balance sheet, to 
 

	
             
 	
            (2)
 	
            Adjusted EBITDA, after giving pro forma effect, without duplication, to 
 

	
             
 	
            (i)
 	
            the incurrence, repayment or retirement of any Indebtedness by the Company or its Restricted Subsidiaries since the last day of the most recent full fiscal quarter of the Company; 
 

 

6

 

 

 

	
             
 	
            (ii)
 	
            if the Leverage Ratio is being determined in connection with the incurrence of Indebtedness by the Company or a Restricted Subsidiary, such Indebtedness; and 
 

	
             
 	
            (iii)
 	
            the Indebtedness to be incurred in connection with the acquisition of any Acquisition EBITDA Entity. 
 

“Lien” means, with respect to any asset, any mortgage, lien, pledge, charge, security interest or encumbrance of any kind in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law (including any conditional sale or other title retention agreement, any lease in the nature thereof, any option or other agreement to sell or give a security interest in and any filing of or agreement to give any financing statement under the Uniform Commercial Code, or equivalent statutes, of any jurisdiction). 

“Make-Whole Amount” means, with respect to any Note, an amount equal to the excess, if any, of: 

	
             
 	
            (1)
 	
            the present value of the remaining principal, premium and interest payments that would be payable with respect to such Note if such Note were redeemed on July 15, 2011, computed using a discount rate equal to the Treasury Rate plus 75 basis points, over  
 

	
             
 	
            (2)
 	
            the outstanding principal amount of such Note. 
 

“Make-Whole Average Life” means, with respect to any date of redemption of Notes, the number of years (calculated to the nearest one-twelfth) from such redemption date to July 15, 2011. 

“Make-Whole Price” means, with respect to any Note, the greater of: 

	
             
 	
            (1)
 	
            the sum of the principal amount of and Make-Whole Amount with respect to such Note; and 
 

	
             
 	
            (2)
 	
            the redemption price of such Note on July 15, 2011. 
 

“Market Price” means: 

	
             
 	
            (1)
 	
            with respect to the calculation of Equity Proceeds from the issuance or sale of debt securities which have been converted into Equity Interests, the value received upon the original issuance or sale of such converted debt securities, as determined reasonably and in good faith by the Board of Directors; and 
 

	
             
 	
            (2)
 	
            with respect to the calculation of Equity Proceeds from the issuance or sale of Equity Interests, the average of the daily closing prices for such Equity Interests for the 20 consecutive trading days preceding the date of such computation. 
 

The closing price for each day shall be: 

	
             
 	
            (1)
 	
            if such Equity Interests are then listed or admitted to trading on the New York Stock Exchange, the closing price on the NYSE Consolidated Tape (or any successor consolidated tape reporting transactions on the New York Stock Exchange) or, if such composite tape shall not be in use or shall not report 
 

 

7

 

 

transactions in such Equity Interests, or if such Equity Interests shall be listed on a stock exchange other than the New York Stock Exchange (including for this purpose the Nasdaq National Market), the last reported sale price regular way for such day, or in case no such reported sale takes place on such day, the average of the closing bid and asked prices regular way for such day, in each case on the principal national securities exchange on which such Equity Interests are listed or admitted to trading (which shall be the national securities exchange on which the greatest number of such Equity Interests have been traded during such 20 consecutive trading days); or 

	
             
 	
            (2)
 	
            if such Equity Interests are not listed or admitted to trading on any such exchange, the average of the closing bid and asked prices thereof in the over-the-counter market as reported by the National Association of Securities Dealers Automated Quotation System or any successor system, or if not included therein, the average of the closing bid and asked prices thereof furnished by two members of the National Association of Securities Dealers selected reasonably and in good faith by the Board of Directors for that purpose. In the absence of one or more such quotations, the Market Price for such Equity Interests shall be determined reasonably and in good faith by the Board of Directors. 
 

“Net Proceeds” means the aggregate cash proceeds received by the Company or any of its Restricted Subsidiaries in respect of any Asset Sale, which amount is equal to the excess, if any, of: 

	
             
 	
            (1)
 	
            the cash received by the Company or such Restricted Subsidiary (including any cash payments received by way of deferred payment pursuant to, or monetization of, a note or installment receivable or otherwise, but only as and when received) in connection with such disposition, over 
 

	
             
 	
            (2)
 	
            the sum of: 
 

	
             
 	
            (i)
 	
            the amount of any Indebtedness which is secured by such asset and which is required to be repaid in connection with the disposition thereof; plus 
 

	
             
 	
            (ii)
 	
            the reasonable out-of-pocket expenses incurred by the Company or such Restricted Subsidiary, as the case may be, in connection with such disposition or in connection with the transfer of such amount from such Restricted Subsidiary to the Company; plus 
 

	
             
 	
            (iii)
 	
            provisions for taxes, including income taxes, attributable to the disposition of such asset or attributable to required prepayments or repayments of Indebtedness with the proceeds thereof; plus
 

	
             
 	
            (iv)
 	
            if the Company does not first receive a transfer of such amount from the relevant Restricted Subsidiary with respect to the disposition of an asset by such Restricted Subsidiary and such Restricted Subsidiary intends to make such transfer as soon as practicable, the out-of-pocket expenses and taxes that the Company reasonably estimates will be incurred by the Company or such Restricted Subsidiary in connection with such transfer at the time such transfer is expected to be received by the Company 
 

 

8

 

 

(including, without limitation, withholding taxes on the remittance of such amount). 

“Notes” has the meaning assigned to it in the preamble to this Third Supplemental Indenture.  The Initial Notes and any Additional Notes shall be treated as a single class for all purposes under this Third Supplemental Indenture and the Indenture. 

“Permitted Investments” means: 

	
             
 	
            (1)
 	
            any Investments in the Company or in a Restricted Subsidiary (other than an Excluded Restricted Subsidiary) of the Company, including without limitation the Guarantee of Indebtedness permitted under Section 2.6(b) of the Third Supplemental Indenture (Section 4.9 of the Indenture); 
 

	
             
 	
            (2)
 	
            any Investments in Cash Equivalents; 
 

	
             
 	
            (3)
 	
            Investments by the Company or any Restricted Subsidiary of the Company in a Person, if as a result of such Investment; 
 

	
             
 	
            (i)
 	
            such Person becomes a Restricted Subsidiary (other than an Excluded Restricted Subsidiary) of the Company; or 
 

	
             
 	
            (ii)
 	
            such Person is merged, consolidated or amalgamated with or into, or transfers or conveys substantially all of its assets to, or is liquidated into, the Company or a Restricted Subsidiary (other than an Excluded Restricted Subsidiary) of the Company; 
 

	
             
 	
            (4)
 	
            Investments in assets (including accounts and notes receivable) owned or used in the ordinary course of business; 
 

	
             
 	
            (5)
 	
            Investments for any purpose related to the Company’s records and information management business (including, without limitation, the Company’s confidential destruction and fulfillment businesses) in an aggregate outstanding amount not to exceed $10.0 million; and 
 

	
             
 	
            (6)
 	
            Investments by the Company or a Restricted Subsidiary (other than an Excluded Restricted Subsidiary) in one or more Excluded Restricted Subsidiaries, the aggregate outstanding amount of which does not exceed 30% of the consolidated assets of the Company and its Restricted Subsidiaries. 
 

“Permitted Liens” means: 

	
             
 	
            (1)
 	
            Liens existing as of the date of issuance of the Notes; 
 

	
             
 	
            (2)
 	
            Liens on property or assets of the Company or any Restricted Subsidiary securing Senior Debt; 
 

	
             
 	
            (3)
 	
            Liens on any property or assets of a Restricted Subsidiary granted in favor of the Company or any Wholly Owned Restricted Subsidiary; 
 

	
             
 	
            (4)
 	
            Liens securing the Notes or the Guarantees; 
 

 

9

 

 

 

	
             
 	
            (5)
 	
            any interest or title of a lessor under any Capital Lease Obligation or Sale and Leaseback Transaction so long as the Indebtedness, if any, secured by such Lien does not exceed the principal amount of Indebtedness permitted under Section 2.6(b) of the Third Supplemental Indenture (Section 4.9 of the Indenture);
 

	
             
 	
            (6)
 	
            Liens securing Acquired Debt created prior to (and not in connection with or in contemplation of) the incurrence of such Indebtedness by the Company or any Restricted Subsidiary; provided that such Lien does not extend to any property or assets of the Company or any Restricted Subsidiary other than the assets acquired in connection with the incurrence of such Acquired Debt; 
 

	
             
 	
            (7)
 	
            Liens securing Hedging Obligations permitted to be incurred pursuant to clause (7) of Section 2.6(b) of the Third Supplemental Indenture (clause (7) of Section 4.9 of the Indenture);
 

	
             
 	
            (8)
 	
            Liens arising from purchase money mortgages and purchase money security interests, or in respect of the construction of property or assets, incurred in the ordinary course of the business of the Company or a Restricted Subsidiary; provided that (i) the related Indebtedness is not secured by any property or assets of the Company or any Restricted Subsidiary other than the property and assets so acquired or constructed and (ii) the Lien securing such Indebtedness is created within 60 days of such acquisition or construction; 
 

	
             
 	
            (9)
 	
            statutory Liens or landlords’ and carriers’, warehousemen’s, mechanics’, suppliers’, materialmen’s, repairmen’s or other like Liens arising in the ordinary course of business and with respect to amounts not yet delinquent or being contested in good faith by appropriate proceedings, if a reserve or other appropriate provision, if any, as shall be required in conformity with GAAP shall have been made therefor; 
 

	
             
 	
            (10)
 	
            Liens for taxes, assessments, government charges or claims with respect to amounts not yet delinquent or that are being contested in good faith by appropriate proceedings diligently conducted, if a reserve or other appropriate provision, if any, as is required in conformity with GAAP has been made therefor; 
 

	
             
 	
            (11)
 	
            Liens incurred or deposits made to secure the performance of tenders, bids, leases, statutory obligations, surety and appeal bonds, government contracts, performance bonds and other obligations of a like nature incurred in the ordinary course of business (other than contracts for the payment of money); 
 

	
             
 	
            (12)
 	
            easements, rights-of-way, restrictions and other similar charges or encumbrances not interfering in any material respect with the business of the Company or any Restricted Subsidiary incurred in the ordinary course of business; 
 

	
             
 	
            (13)
 	
            Liens arising by reason of any judgment, decree or order of any court so long as such Lien is adequately bonded and any appropriate legal proceedings that may have been duly initiated for the review of such judgment, decree or order shall not have been finally terminated or the period within which such proceedings may be initiated shall not have expired; 
 

 

10

 

 

 

	
             
 	
            (14)
 	
            Liens arising under options or agreements to sell assets; 
 

	
             
 	
            (15)
 	
            other Liens securing obligations incurred in the ordinary course of business, which obligations do not exceed $10.0 million in the aggregate at any one time outstanding; and 
 

	
             
 	
            (16)
 	
            any extension, renewal or replacement, in whole or in part, of any Lien described in the foregoing clauses (1) through (15); provided that any such extension, renewal or replacement shall not extend to any additional property or assets. 
 

“Principal Stockholders” means each of Vincent J. Ryan, Schooner Capital LLC, C. Richard Reese, Kent P. Dauten, B. Thomas Golisano and their respective Affiliates. 

“Qualified Equity Offering” means an offering of Capital Stock, other than Disqualified Stock, of the Company for Dollars, whether registered or exempt from registration under the Securities Act. 

“Qualified Issuer” means: 

	
             
 	
            (1)
 	
            any lender party to the Credit Agreement; or 
 

	
             
 	
            (2)
 	
            any commercial bank: 
 

	
             
 	
            (i)
 	
            which has capital and surplus in excess of $500,000,000; and 
 

	
             
 	
            (ii)
 	
            the outstanding short-term debt securities of which are rated at least A-2 by Standard & Poor’s Rating Group, a division of McGraw-Hill, Inc. or at least P-2 by Moody’s Investors Service, or carry an equivalent rating by a nationally recognized rating agency if both of the two named rating agencies cease publishing ratings of investments. 
 

“Qualifying Sale and Leaseback Transaction” means any Sale and Leaseback Transaction between the Company or any of its Restricted Subsidiaries and any bank, insurance company or other lender or investor providing for the leasing to the Company or such Restricted Subsidiary of any property (real or personal) which has been or is to be sold or transferred by the Company or such Restricted Subsidiary to such lender or investor or to any Person to whom funds have been or are to be advanced by such lender or investor and where the property in question has been constructed or acquired after the date of the Third Supplemental Indenture. 

“Refinancing Indebtedness” means new Indebtedness incurred or given in exchange for, or the proceeds of which are used to repay, redeem, defease, extend, refinance, renew, replace or refund, other Indebtedness; provided, however, that: 

	
             
 	
            (1)
 	
            the principal amount of such new Indebtedness shall not exceed the principal amount of Indebtedness so repaid, redeemed, defeased, extended, refinanced, renewed, replaced or refunded (plus the amount of fees, premiums, consent fees, prepayment penalties and expenses incurred in connection therewith); 
 

	
             
 	
            (2)
 	
            such Refinancing Indebtedness shall have a Weighted Average Life to Maturity equal to or greater than the Weighted Average Life to Maturity of the Indebtedness 
 

 

11

 

 

so repaid, redeemed, defeased, extended, refinanced, renewed, replaced or refunded or shall mature after the maturity date of the Notes; 

	
             
 	
            (3)
 	
            to the extent such Refinancing Indebtedness refinances Indebtedness that has a final maturity date occurring after the initial scheduled maturity date of the Notes, such new Indebtedness shall have a final scheduled maturity not earlier than the final scheduled maturity of the Indebtedness so repaid, redeemed, defeased, extended, refinanced, renewed, replaced or refunded and shall not permit redemption at the option of the holder earlier than the earliest date of redemption at the option of the holder of the Indebtedness so repaid, redeemed, defeased, extended, refinanced, renewed, replaced or refunded; 
 

	
             
 	
            (4)
 	
            to the extent such Refinancing Indebtedness refinances Indebtedness subordinate to the Notes, such Refinancing Indebtedness shall be subordinated in right of payment to the Notes and to the extent such Refinancing Indebtedness refinances Notes or Indebtedness pari passu with the Notes, such Refinancing Indebtedness shall be pari passu with or subordinated in right of payment to the Notes, in each case on terms at least as favorable to the holders of Notes as those contained in the documentation governing the Indebtedness so repaid, redeemed, defeased, extended, refinanced, renewed, replaced or refunded; and 
 

	
             
 	
            (5)
 	
            with respect to Refinancing Indebtedness incurred by a Restricted Subsidiary, such Refinancing Indebtedness shall rank no more senior, and shall be at least as subordinated, in right of payment to the Subsidiary Guarantee of such Restricted Subsidiary as the Indebtedness being extended, refinanced, renewed, replaced or refunded. 
 

“Restricted Subsidiary” means: 

	
             
 	
            (1)
 	
            each direct or indirect Subsidiary of the Company existing on the date of the Third Supplemental Indenture (other than Subsidiaries of Iron Mountain Global, Inc. (including Iron Mountain Europe Limited, Iron Mountain Cayman Ltd., Iron Mountain Mexico, S.A. de R.L. de C.V. and their respective Subsidiaries), Iron Mountain Assurance Corporation, Mountain West Palm Real Estate, Inc. and Upper Providence Venture I, L.P.); and 
 

	
             
 	
            (2)
 	
            any other direct or indirect Subsidiary of the Company formed, acquired or existing after the date of the Third Supplemental Indenture (including an Excluded Restricted Subsidiary), 
 

which, in the case of (1) or (2), is not designated by the Board of Directors as an “Unrestricted Subsidiary.” 

“Sale and Leaseback Transaction” means any transaction or series of related transactions pursuant to which a Person sells or transfers any property or asset in connection with the leasing, or the resale against installment payments, of such property or asset to the seller or transferor. 

“Senior Bank Debt” means all Obligations outstanding under or in connection with the Credit Agreement (including Guarantees of such Obligations by Subsidiaries of the Company). 

 

12

 

 

 

“Senior Debt” means: 

	
             
 	
            (1)
 	
            the Senior Bank Debt; and 
 

	
             
 	
            (2)
 	
            any other Indebtedness permitted to be incurred by the Company or any Restricted Subsidiary, as the case may be, under the terms of the Third Supplemental Indenture or the Indenture, unless the instrument under which such Indebtedness is incurred expressly provides that it is: 
 

	
             
 	
            (i)
 	
            on a parity with or subordinated in right of payment to the Notes; or 
 

	
             
 	
            (ii)
 	
            subordinated to Senior Debt on terms substantially similar to those of the Notes. 
 

Notwithstanding anything to the contrary in the foregoing, Senior Debt shall not include: 

	
             
 	
            (1)
 	
            any liability for federal, state, local or other taxes owed or owing by the Company; 
 

	
             
 	
            (2)
 	
            any Indebtedness of the Company to any of its Subsidiaries or other Affiliates; 
 

	
             
 	
            (3)
 	
            any trade payables; or 
 

	
             
 	
            (4)
 	
            any Indebtedness that is incurred in violation of the Third Supplemental Indenture or the Indenture, provided that such Indebtedness shall be deemed not to have been incurred in violation of the Third Supplemental Indenture or the Indenture for purposes of this clause (4) if, in the case of any obligations under the Credit Agreement, the holders of such obligations or their agent or representative shall have received a representation from the Company to the effect that the incurrence of such Indebtedness does not violate the provisions of the Third Supplemental Indenture or the Indenture. 
 

“Treasury Rate” means, at any time of computation, the yield to maturity at such time (as compiled by and published in the most recent Federal Reserve Statistical Release H.15(519), which has become publicly available at least two business days prior to the date of the redemption notice or, if such Statistical Release is no longer published, any publicly available source of similar market data) of United States Treasury securities with a constant maturity most nearly equal to the Make-Whole Average Life; provided, however, that if the Make-Whole Average Life is not equal to the constant maturity of the United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year)
from the weekly average yields of United States Treasury securities for which such yields are given, except that if the Make-Whole Average Life is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used. 

“Unrestricted Subsidiary” means: 

	
             
 	
            (1)
 	
            any Subsidiary that is designated by the Board of Directors as an Unrestricted Subsidiary in accordance with Section 2.6(h) of the Third Supplemental Indenture (Section 4.15 of the Indenture); and 
 

	
             
 	
            (2)
 	
            any Subsidiary of an Unrestricted Subsidiary. 
 

 

13

 

 

 

As of the date hereof, the following Subsidiaries of the Company have been designated as Unrestricted Subsidiaries:  Subsidiaries of Iron Mountain Global, Inc. (including Iron Mountain Europe Limited, Iron Mountain Cayman Ltd., Iron Mountain Mexico, S.A. de R.L. de C.V. and their respective Subsidiaries), Iron Mountain Assurance Corporation, Mountain West Palm Real Estate, Inc. and Upper Providence Venture I, L.P.

“Voting Stock” means any class or classes of Capital Stock pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the board of directors, managers or trustees of any Person (irrespective of whether or not, at the time, stock of any other class or classes has, or might have, voting power by reason of the happening of any contingency). 

“Weighted Average Life to Maturity” means, when applied to any Indebtedness at any date, the number of years obtained by dividing: 

	
             
 	
            (1)
 	
            the sum of the products obtained by multiplying (x) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including payment at final maturity, in respect thereof, by (y) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment, by 
 

	
             
 	
            (2)
 	
            the then outstanding principal amount of such Indebtedness. 
 

“Wholly Owned Restricted Subsidiary” means any Restricted Subsidiary of the Company all of the outstanding Capital Stock or other ownership interests of which (other than directors’ qualifying shares) shall at the time be owned by the Company or by one or more Wholly Owned Restricted Subsidiaries of the Company.

“1996 Indenture Date” means October 1, 1996.

“1999 Indenture Date” means April 26, 1999.

“6 5/8% Notes” means the Company’s 6 5/8% Senior Subordinated Notes due 2016 issued pursuant to the Indenture.

“71⁄4% Notes” means the Company’s 71⁄4% GBP Senior Subordinated Notes due 2014 issued pursuant to the Indenture.

“73⁄4% Notes” means the Company’s 73⁄4% Senior Subordinated Notes due 2015 issued pursuant to the Indenture.

“81⁄4% Notes” means the Company’s 81⁄4% Senior Subordinated Notes due 2011 issued pursuant to the indenture dated April 26, 1999, by and among the Company, certain of its subsidiaries and the Trustee.

“8 5/8% Notes” means the Company’s Senior Subordinated Notes due 2013 issued pursuant to the indenture dated April 3, 2001, by and among the Company, certain of its subsidiaries and the Trustee.

	
             
  	
            (b)  
 	
            Other Definitions.
 

 

 

14

 

 

 

The definitions of the following terms may be found in the Sections indicated as follows:

	
            Term
 	
            Defined in Section
 
	  	  
	
            “Affiliate Transaction”
 	
            2.6(e)
 
	
            “Asset Sale”
 	
            2.6(j)
 
	
            “Asset Sale Offer”
 	
            2.6(j)
 
	
            “Change of Control Offer”
 	
            2.6(k)
 
	
            “Change of Control Payment”
 	
            2.6(k)
 
	
            “Change of Control Payment Date”
 	
            2.6(k)
 
	
            “Commencement Date”
 	
            2.6(j)
 
	
            “Company”
 	
            Preamble
 
	
            “DTC”
 	
            2.3
 
	
            “Excess Proceeds”
 	
            2.6(j)
 
	
            “Third Supplemental Indenture”
 	
            Preamble
 
	
            “Indenture”
 	
            Recitals
 
	
            “Restricted Payments”
 	
            2.6(a)
 
	
            “Trustee”
 	
            Preamble
 

 

ARTICLE 2.

 

FORM AND TERMS OF THE NOTES

Section 2.1.         Form and Dating.   (a)  General.  The Notes and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A attached hereto.  The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage.  Each Note shall be dated the date of its authentication.  The Notes shall be in denominations of $1,000 and integral multiples thereof.

The terms and provisions contained in the Notes shall constitute, and are hereby expressly made, a part of the Third Supplemental Indenture and the Indenture and the Company, the Guarantors and the Trustee, by their execution and delivery of the Third Supplemental Indenture and the Indenture (or in the case of any Guarantor that becomes such after the date hereof, a supplemental indenture pursuant to Section 2.6(g) of this Third Supplemental Indenture (Section 4.14 of the Indenture)), expressly agree to such terms and provisions and to be bound thereby.  However, to the extent any provision of any Note conflicts with the express provisions of the Indenture (as supplemented by this Third Supplemental Indenture), the provisions of the Indenture shall govern and be controlling.

(b)        Global Notes.  Notes shall be issued initially in the form of the Global Notes, which shall be deposited on behalf of the purchasers of the Notes represented thereby with the Depository at its New York office, and registered in the name of the Depository or a nominee of the Depository, duly executed by the Company and authenticated by the Trustee as hereinafter provided.  The aggregate principal amount of the Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee and the Depository or its nominee as hereinafter provided.

Each Global Note shall represent such of the outstanding Notes as shall be specified therein and each shall provide that it represents the aggregate principal amount of outstanding Notes from time to time endorsed thereon and that the aggregate amount of outstanding Notes represented thereby may from time to time be reduced or increased, as appropriate, to reflect exchanges and redemptions.  Any endorsement of a Global Note to reflect the amount of any increase or decrease in the aggregate principal amount of outstanding Notes represented thereby shall be made by the Trustee or the Service Agent, at the direction of the Trustee, in accordance with instructions given by the Holder thereof as required by Section 2.4 hereof.

 

15

 

(c)          Book-Entry Provisions.  This Section 2.1(c) shall apply only to the Global Notes deposited with or on behalf of the Depository.

The Company shall execute and the Trustee shall, in accordance with this Section 2.1(c), authenticate and deliver the Global Notes that (i) shall be registered in the name of the Depository or the nominee of the Depository and (ii) shall be delivered by the Trustee to the Depository or pursuant to the Depository’s instructions or held by the Service Agent.

Agent Members shall have no rights either under the Third Supplemental Indenture or the Indenture with respect to any Global Notes held on their behalf by the Depository or by the Service Agent or under such Global Notes, and the Depository may be treated by the Company, the Trustee and any agent of the Company or the Trustee as the absolute owner of such Global Notes for all purposes whatsoever.  

(d)         Definitive Notes.  Notes issued in certificated form shall be substantially in the form of Exhibit A attached hereto (but without including the text referred to in Section 2.15.3 of the Indenture).  Except as provided in Section 2.4, owners of beneficial interests in the Global Notes will not be entitled to receive physical delivery of certificated Securities.

	
            Section 2.2.
 	
            Execution and Authentication.
 

The Trustee shall, upon a written order of the Company signed by an Officer, authenticate up to $200,000,000 aggregate principal amount of Initial Notes and such amount of Additional Notes as the Company may issue from time to time.

	
            Section 2.3.
 	
            Depository and Paying Agent for Notes.
 

The Company initially appoints The Depository Trust Company (“DTC”) to act as Depository with respect to the Global Notes.  The Company initially appoints the Trustee to act as the Registrar, Paying Agent and Service Agent with respect to the Global Notes.

	
            Section 2.4.
 	
            Transfer and Exchange of Notes.
 

(a)          Transfer and Exchange of Global Notes.  The transfer and exchange of beneficial interests in the Global Notes shall be effected through the Depository, in accordance with the Third Supplemental Indenture and the Indenture and the procedures of the Depository therefor.  Beneficial interests in the Global Notes may be transferred to Persons who take delivery thereof in the form of a beneficial interest in the Global Notes.

(b)          Transfer and Exchange of Definitive Notes.  When Definitive Notes are presented by a Holder to the Registrar with a request:

	
             
 	
            (x)
 	
            to register the transfer of the Definitive Notes; or
 

	
             
 	
            (y)
 	
            to exchange such Definitive Notes for an equal principal amount of Definitive Notes of other authorized denominations, the Registrar shall register the transfer or make the exchange as requested if its requirements for such transactions are met; provided, however, that the Definitive Notes presented or surrendered for register of transfer or exchange shall be duly endorsed or
accompanied by a written instruction 
 

 

16

 

 

of transfer in form satisfactory to the Registrar duly executed by such
Holder or by his attorney, duly authorized in writing.

(c)        Restrictions on Transfer and Exchange of Global Notes.  Notwithstanding any other provision of the Third Supplemental Indenture or the Indenture (other than the provisions set forth in subsection (d) of this Section 2.4), the Global Notes may not be transferred as a whole except by the Depository to a nominee of the Depository, by a nominee of the Depository to the Depository or to another nominee of the Depository, or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository.

	
             
  	
            (d)  
 	
            Authentication of Definitive Notes in Absence of Depository.  If at any time:
 

	
             
 	
            (i)
 	
            the Depository for the Notes notifies the Company that the Depository is unwilling or unable to continue as Depository for the Global Notes and a successor Depository for the Global Notes is not appointed by the Company within 90 days after delivery of such notice; or
 

	
             
 	
            (ii)
 	
            the Company at its sole discretion, notifies the Trustee in writing that it elects to cause the issuance of Definitive Notes under the Third Supplemental Indenture and the Indenture,
 

then the Company shall execute, and the Trustee shall, upon receipt of an authentication order in accordance with Section 2.2 hereof, authenticate and deliver, Definitive Notes in an aggregate principal amount equal to the principal amount of the Global Notes in exchange for such Global Notes.

(e)        Cancellation and/or Adjustment of the Global Notes.  At such time as all beneficial interests in a particular Global Note have been exchanged for Definitive Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note shall be returned to or retained and canceled by the Trustee in accordance with Section 2.12 of the Indenture.  At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Definitive Notes, the principal amount of Notes represented by the Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee
or by the Depository at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement will be made on such Global Note by the Trustee or by the Depository at the direction of the Trustee to reflect such increase.  

	
             
  	
            (f)  
 	
            General Provisions Relating to Transfers and Exchanges.
 

	
             
 	
            (i)
 	
            To permit registrations of transfers and exchanges,
the Company shall execute and the Trustee shall authenticate Global Notes and Definitive Notes upon receipt
of an Authentication Order in accordance with Section 2.2 hereof or at the Registrar’s request.
 

	
             
 	
            (ii)
 	
            No service charge shall be made to a Holder of a Global Note or to a Holder of a Definitive Note for any registration of transfer or exchange, but the Company may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith (other than any such transfer
taxes or similar governmental 
 

 

17

 

 

charge payable upon exchange or transfer pursuant to Section 2.4 hereof).

	
             
 	
            (iii)
 	
            All Global Notes and Definitive Notes issued upon any registration of transfer or exchange of Global Notes or Definitive Notes shall be the valid obligations of the Company, evidencing the same debt, and entitled to the same benefits under the Third Supplemental Indenture and the Indenture, as the Global Notes or Definitive Notes surrendered upon such registration of transfer or exchange.
 

	
             
 	
            (iv)
 	
            The Company shall not be required to register the transfer of or to exchange a Note between a record date and the next succeeding interest payment date.
 

	
             
 	
            (iv)
 	
            Prior to due presentment for the registration of a transfer of any Note, the Trustee, any Agent, the Company and any Guarantor may deem and treat the Person in whose name any Note is registered as the absolute owner of such Note for all purposes, including receiving payment of principal of and interest on such Notes, and neither the Trustee, any Agent, the Company nor any Guarantor shall be affected by notice to the contrary.
 

	
             
 	
            (v)
 	
            The Trustee shall authenticate Definitive Notes and the Global Notes in accordance with the provisions of Section 2.2 hereof and Section 2.3 of the Indenture.
 

	
             
 	
            (vi)
 	
            All certifications, certificates and opinions of counsel required to be submitted to the Registrar pursuant to this Section 2.4 to effect a registration of transfer or exchange may be submitted by facsimile.
 

	
            Section 2.5.
 	
            Redemption.
 

With respect to the Notes issued under this Third Supplemental Indenture, the following Sections supplement Article III of the Indenture:

	
             
 	
            § 3.7.
 	
            Optional Redemption.
 

Prior to July 15, 2011, the Notes shall be subject to redemption at any time at the option of the Company, in whole or in part, upon not less than 10 nor more than 60 days’ notice, at the Make-Whole Price, plus accrued and unpaid interest, to but excluding the applicable redemption date.  On and after July 15, 2011, the Notes will be subject to redemption at any time at the option of the Company, in whole or in part, upon not less than 10 nor more than 60 days’ notice, at the redemption price (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest to but excluding the applicable redemption date, if redeemed during the 12-month period beginning on July 15 of the years indicated below: 

	
            Year
 	
            Percentage
 
	
             
 	
             
 
	
            2011                                                                                                                                                                                                                                                                                                                         
 	
            104.375%
 
	
            2012                                                                                                                                                                                                                                                                                                                         
 	
            102.917%
 
	
            2013                                                                                                                                                                                                                                                                                                                         
 	
            101.458%
 
	
            2014 and thereafter                                                                                                                                                                                                                                  
 	
            100.000%
 
	
             
 	
             
 

 

18

 

 

 

Notwithstanding the foregoing, at any time prior to July 15, 2009 the Company may on any one or more occasions redeem the Notes at a redemption price of 108.75% of the principal amount thereof, plus accrued and unpaid interest, and Liquidated Damages if any, to the redemption date, with the net cash proceeds of one or more Qualified Equity Offerings; provided that:

	
             
 	
            (1)
 	
            at least $130.0 million in the aggregate principal amount of the Notes (including any Additional Notes) issued under the Indenture remains outstanding immediately after the occurrence of such redemption (excluding Notes held by the Company and the Company’s Subsidiaries); and 
 

	
             
 	
            (2)
 	
            the redemption must occur within six months of the date of the closing of any such Qualified Equity Offering.
 

	
             
 	
            § 3.8.
 	
            Mandatory Redemption.
 

The Company shall not be required to make mandatory redemption payments or sinking fund payments with respect to the Notes.

	
             
 	
            § 3.9
 	
            Asset Sale Offers.
 

In the event that the Company shall commence an Asset Sale Offer pursuant to Section 4.17 hereof, it shall follow the procedures specified below:

The Asset Sale Offer shall remain open for 20 Business Days after the Commencement Date relating to such Asset Sale Offer, except to the extent required to be extended by applicable law (as so extended, the “Offer Period”).  No later than one Business Day after the termination of the Offer Period (the “Purchase Date”), the Company shall purchase the principal amount (the “Offer Amount”) of Notes required to be purchased in such Asset Sale Offer pursuant to Sections 3.2 and 4.17 hereof or, if less than the Offer Amount has been tendered, all Notes tendered in response to the Asset Sale Offer.  

If the Purchase Date is on or after an interest payment record date and on or before the related interest payment date, any interest accrued to such Purchase Date shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Asset Sale Offer.

On the Commencement Date of any Asset Sale Offer, the Company shall send or cause to be sent, by first class mail, a notice to each of the Holders, with a copy to the Trustee.  Such notice, which shall govern the terms of the Asset Sale Offer, shall contain all instructions and materials necessary to enable the Holders to tender Notes pursuant to the Asset Sale Offer and shall state:

	
             
 	
            (1)
 	
            that the Asset Sale Offer is being made pursuant to this Section 3.9 and Section 4.17 hereof and the length of time the Asset Sale Offer shall remain open;
 

	
             
 	
            (2)
 	
            the Offer Amount, the purchase price and the Purchase Date;
 

 

	
             
 	
            (3)
 	
            that any Note not tendered or accepted for payment shall continue to accrue interest;
 

19

 

	
             
 	
            (4)
 	
            that, unless the Company defaults in the payment of the purchase price, any Note accepted for payment pursuant to the Asset Sale Offer shall cease to accrue interest after the Purchase Date;
 

	
             
 	
            (5)
 	
            that Holders electing to have a Note purchased pursuant to any Asset Sale Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Company, a depositary, if appointed by the Company, or a Paying Agent at the address specified in the notice prior to the close of business on the Business Day preceding the Purchase Date;
 

	
             
 	
            (6)
 	
            that Holders shall be entitled to withdraw their election if the Company, depositary or Paying Agent, as the case may be, receives, not later than the close of business on the Business Day preceding the termination of the Offer Period, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing such Holder’s election to have the Note purchased;
 

	
             
 	
            (7)
 	
            that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Offer Amount, the Trustee shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed to be appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased); and
 

	
             
 	
            (8)
 	
            that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered.
 

On or before 12:00 noon on each Purchase Date, the Company shall irrevocably deposit with the Trustee or Paying Agent in immediately available funds the aggregate purchase price with respect to a principal amount of Notes equal to the Offer Amount, together with accrued interest thereon, to be held for payment in accordance with the terms of this Section 3.9.  On the Purchase Date, the Company shall, to the extent lawful, (i) accept for payment, on a pro rata basis to the extent necessary, an aggregate principal amount equal to the Offer Amount of Notes and other notes (in accordance with the terms of Section 4.17 of the Indenture) tendered pursuant to the Asset Sale Offer, or if less than the Offer Amount has been tendered, all Notes and such other notes or portions thereof tendered, (ii) deliver or cause the Paying Agent or depositary, as
the case may be, to deliver to the Trustee Notes so accepted and (iii) deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.9.  The Company, depositary or Paying Agent, as the case may be, shall promptly (but in any case not later than three Business Days after the Purchase Date) mail or deliver to each tendering Holder an amount equal to the purchase price with respect to the Notes tendered by such Holder and accepted by the Company for purchase, and the Company shall promptly issue a new Note, and the Trustee shall authenticate and mail or deliver such new Note, to such Holder, equal in principal amount to any unpurchased portion of such Holder’s Notes surrendered.  Any Note not accepted in the Asset Sale Offer shall be promptly mailed or delivered by the Company to the Holder thereof.  The Company shall publicly announce in a newspaper of general
circulation the results of the Asset Sale Offer on the Purchase Date.

 

The Asset Sale Offer shall be made by the Company in compliance with all applicable laws, including, without limitation, Regulation 14E of the Exchange Act and the rules thereunder, to the extent applicable, and all other applicable federal and state securities laws.

 

20

 

 

Each purchase pursuant to this Section 3.9 shall be made pursuant to the provisions of Sections 3.1 through 3.6 hereof to the extent applicable.

In the event the amount of Excess Proceeds to be applied to an Asset Sale Offer would result in the purchase of a principal amount of Notes which is not evenly divisible by $1,000, the Trustee shall promptly refund to the Company the portion of such Excess Proceeds that is not necessary to purchase the immediately lesser principal amount of Notes that is so divisible. 

	
            Section 2.6.
 	
            Additional Covenants.
 

With respect to the Notes issued under this Third Supplemental Indenture, Sections 2.6(a) through 2.6(l) are added to Article IV of the Indenture.

	
             
 	
            (a)
 	
            

Restricted Payments.
 

§4.8.  Restricted Payments.  The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly: 

	
             
 	
            (1)
 	
            declare or pay any dividend or make any distribution on account of the Company’s or any of its Restricted Subsidiaries’ Equity Interests (other than dividends or distributions payable in Equity Interests (other than Disqualified Stock) of the Company or such Restricted Subsidiary or dividends or distributions payable to the Company or any Restricted Subsidiary); 
 

	
             
 	
            (2)
 	
            purchase, redeem or otherwise acquire or retire for value any Equity Interests of the Company or any Restricted Subsidiary or other Affiliate of the Company (other than any such Equity Interests owned by the Company or any Restricted Subsidiary); 
 

	
             
 	
            (3)
 	
            purchase, redeem or otherwise acquire or retire prior to scheduled maturity for value any Indebtedness that is subordinated in right of payment to the Notes; or 
 

	
             
 	
            (4)
 	
            make any Investment other than a Permitted Investment (all such payments and other actions set forth in clauses (1) through (4) above being collectively referred to as “Restricted Payments”); 
 

unless, at the time of such Restricted Payment:

	
             
 	
            (i)
 	
            no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof; and 
 

	
             
 	
            (ii)
 	
            the Company would, at the time of such Restricted Payment and after giving pro forma effect thereto, have been permitted to incur at least $1.00 of additional Indebtedness pursuant to the test set forth in the first paragraph of Section 4.9 of the Indenture; and 
 

	
             
 	
            (iii)
 	
            such Restricted
Payment, together with the aggregate of all other Restricted Payments made by the Company and its Restricted Subsidiaries after
the 1996 Indenture Date is less than (x) the cumulative EBITDA of the Company, minus 1.75 times the cumulative Consolidated
Interest Expense of the Company, in each case for the period (taken as 
 

 

21

 

 

 

	
             
 	
             
 	
            one accounting period) from June 30, 1996,
to the end of the Company’s most recently ended fiscal quarter for which internal financial statements are available at the time of such Restricted Payment, plus (y) the aggregate net Equity Proceeds received by the Company from the issuance or sale since the 1996 Indenture Date of Equity Interests of the Company or of debt securities of the Company that have been converted into such Equity Interests (other than Equity Interests or
convertible debt securities sold to a Restricted Subsidiary of the Company and other than Disqualified Stock or debt securities that have been converted into Disqualified Stock), plus (z) $2.0 million. 
 

The foregoing provisions will not prohibit: 

	
             
 	
            (1)
 	
            the payment of any dividend within 60 days after the date of declaration thereof, if at said date of declaration such payment would have complied with the provisions of the Indenture; 
 

	
             
 	
            (2)
 	
            the redemption, repurchase, retirement or other acquisition or retirement for value of any Equity Interests of the Company in exchange for, or with the net cash proceeds of, the substantially concurrent sale (other than to a Restricted Subsidiary of the Company) of other Equity Interests of the Company (other than any Disqualified Stock); 
 

	
             
 	
            (3)
 	
            the defeasance, redemption, repurchase, retirement or other acquisition or retirement for value of Indebtedness that is subordinated in right of payment to the Notes in exchange for, or with the net cash proceeds of, a substantially concurrent issuance and sale (other than to a Restricted Subsidiary of the Company) of Equity Interests of the Company (other than Disqualified Stock); 
 

	
             
 	
            (4)
 	
            the defeasance, redemption, repurchase, retirement or other acquisition or retirement for value of Indebtedness that is subordinated in right of payment to the Notes in exchange for, or with the net cash proceeds of, a substantially concurrent issue and sale (other than to the Company or any of its Restricted Subsidiaries) of Refinancing Indebtedness; 
 

	
             
 	
            (5)
 	
            the repurchase of any Indebtedness subordinated in right of payment to the Notes at a purchase price not greater than 101% of the principal amount of such Indebtedness in the event of a Change of Control in accordance with provisions similar to the covenant set forth in Section 4.18 of the Indenture, provided that prior to or contemporaneously with such repurchase the Company has made the Change of Control Offer as provided in such covenant with respect to the Notes and has repurchased all Notes validly tendered for payment in connection with such Change of Control Offer; and 
 

	
             
 	
            (6)
 	
            additional payments to current or former employees or directors of the Company for repurchases of stock, stock options or other equity interests, provided that the aggregate amount of all such payments under this clause (6) does not exceed $0.5 million in any
year and $2.0 million in the aggregate.
 

The Restricted Payments described in clauses (2), (3), (5) and (6) of the immediately preceding paragraph
shall be Restricted Payments that shall be permitted to be taken in accordance with

 

 

22

 

 

such paragraph but shall reduce the
amount that would otherwise be available for Restricted Payments under clause (iii) of the first paragraph of this Section, and the Restricted Payments described in clauses (1) and (4) of the immediately preceding paragraph shall be Restricted Payments that shall be permitted to be taken in accordance with such paragraph and shall not reduce the amount that would otherwise be available for Restricted Payments under clause (iii) of the first paragraph of this Section. 

If an Investment results in the making of a Restricted Payment, the aggregate amount of all Restricted Payments deemed to have been made as calculated under the foregoing provision shall be reduced by the amount of any net reduction in such Investment (resulting from the payment of interest or dividends, loan repayment, transfer of assets or otherwise) to the extent such net reduction is not included in the Company’s EBITDA; provided, however, that the total amount by which the aggregate amount of all Restricted Payments may be reduced may not exceed the lesser of (a) the cash proceeds received by the Company and its Restricted Subsidiaries in connection with such net reduction and (b) the initial amount of such Investment.  In addition, for the avoidance of doubt and to avoid
double counting, if an Investment results in the making of a Restricted Payment, then the subsequent assignment, contribution, distribution or other transfer of such Investment by the Company or any Restricted Subsidiary of the Company to any Excluded Restricted Subsidiary or Unrestricted Subsidiary shall not be considered a new Investment or Restricted Payment and shall not further reduce the amount that would otherwise be available for Restricted Payments under clause (iii) of the first paragraph of this Section.  

If the aggregate amount of all Restricted Payments calculated under the foregoing provision includes an Investment in an Unrestricted Subsidiary or other Person that thereafter becomes a Restricted Subsidiary, such Investment will no longer be counted as a Restricted Payment for purposes of calculating the aggregate amount of Restricted Payments. 

For the purpose of making any Restricted Payment calculations under the Indenture: 

	
             
 	
            (1)
 	
            Investments shall include the fair market value of the net assets of any Restricted Subsidiary at the time that such Restricted Subsidiary is designated an Unrestricted Subsidiary and shall exclude the fair market value of the net assets of any Unrestricted Subsidiary that is designated as a Restricted Subsidiary, in each case with fair market value determined by the Board of Directors in good faith and, for the avoidance of doubt, such inclusions and exclusions will not be limited by the amount of any Investment or aggregate Investments; 
 

	
             
 	
            (2)
 	
            any asset or property transferred to or from an Unrestricted Subsidiary shall be valued at fair market value at the time of such transfer, provided that, in each case, the fair market value of an asset or property is as determined by the Board of Directors in good faith and, for the avoidance of doubt, the fair market value (as so determined) of such asset of property shall be subtracted from (in the case of a transfer to an Unrestricted Subsidiary) or added to (in the case of a transfer from an Unrestricted Subsidiary) the calculation under clause (iii) of the first paragraph of this Section; and 
 

	
             
 	
            (3)
 	
            subject to the foregoing, the amount of any Restricted Payment, if other than cash, shall be determined by the Board of Directors, whose good faith determination shall be conclusive. 
 

 

The Board of Directors may
designate a Restricted Subsidiary to be an Unrestricted Subsidiary in compliance with the Section 4.15 of the Indenture.
Upon such designation, all outstanding Investments by the Company and its Restricted Subsidiaries (except to the extent repaid
in cash) in the 

23

 

 

 

Subsidiary so designated will be deemed to be Restricted Payments made at the time of such designation and will
reduce the amount available for Restricted Payments under the first paragraph of this covenant. Such designation will only be
permitted if such Restricted Payment would be permitted at such time and if such Restricted Subsidiary otherwise meets the
definition of an Unrestricted Subsidiary.
 

	
             
 	
            (b)
 	
            Incurrence of Indebtedness and Issuance of Preferred Stock.
 
 

§4.9.  Incurrence of Indebtedness and Issuance of Preferred Stock.  The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty or otherwise become directly or indirectly liable with respect to (collectively, “incur”) any Indebtedness (including Acquired Debt) and the Company shall not permit any of its Restricted Subsidiaries to issue any shares of preferred stock; provided, however, that the Company may incur Indebtedness and may permit a Restricted Subsidiary to incur Indebtedness if at the time of such incurrence and after giving effect thereto the Leverage Ratio would be less than 6.5 to 1.0. 

The foregoing limitations shall not apply to: 

	
             
 	
            (1)
 	
            the incurrence by the Company or any Restricted Subsidiary of Senior Bank Debt in an aggregate amount not to exceed $100.0 million at any one time outstanding; 
 

	
             
 	
            (2)
 	
            the issuance by the Restricted Subsidiaries of Subsidiary Guarantees; 
 

	
             
 	
            (3)
 	
            the incurrence by the Company and its Restricted Subsidiaries of the Existing Indebtedness; 
 

	
             
 	
            (4)
 	
            the issuance by the Company of the Notes; 
 

	
             
 	
            (5)
 	
            the incurrence by the Company and its Restricted Subsidiaries of Capital Lease Obligations and/or additional Indebtedness constituting purchase money obligations up to an aggregate of $5.0 million at any one time outstanding, provided that the Liens securing such Indebtedness constitute Permitted Liens; 
 

	
             
 	
            (6)
 	
            the incurrence of Indebtedness between (i) the Company and its Restricted Subsidiaries and (ii) the Restricted Subsidiaries; 
 

	
             
 	
            (7)
 	
            Hedging Obligations that are incurred for the purpose of fixing or hedging interest rate risk with respect to any floating rate Indebtedness that is permitted by the terms of the Indenture to be outstanding; 
 

	
             
 	
            (8)
 	
            the incurrence by the Company and its Restricted Subsidiaries of Indebtedness arising out of letters of credit, performance bonds, surety bonds and bankers’ acceptances incurred in the ordinary course of business up to an aggregate of $5.0 million at any one time outstanding; 
 

	
             
 	
            (9)
 	
            the incurrence by the Company and its Restricted Subsidiaries of Indebtedness consisting of guarantees, indemnities or obligations in respect of purchase price adjustments in connection with the acquisition or disposition of assets, including, without limitation, shares of Capital Stock; and 
 

	
             
 	
            (10)
 	
            
the incurrence by the Company and its Restricted Subsidiaries of Refinancing Indebtedness issued in exchange
for, or the proceeds of which are used to repay, 
 

 

24

 

 

 

	
             
 	
            
 	
            redeem, defease, extend, refinance, renew, replace or refund,
 Indebtedness referred to in clauses (2) through (5) above, and this clause (10) or that was
otherwise permitted to be incurred pursuant to the test set forth in the first paragraph of this Section 4.9.
 

	
             
  	
            (c)  
 	
            Liens.
 

§4.10.  Liens.  Neither the Company nor any of its Restricted Subsidiaries may directly or indirectly create, incur, assume or suffer to exist any Lien (other than a Permitted Lien) upon any property or assets now owned or hereafter acquired, or any income, profits or proceeds therefrom, or assign or otherwise convey any right to receive income therefrom, unless (a) in the case of any Lien securing any Indebtedness that is subordinate to the Notes, the Notes are secured by a Lien on such property, assets or proceeds that is senior in priority to such Lien and (b) in the case of any other Lien, the Notes are equally and ratably secured with the obligation or liability secured by such Lien. 

	
             
  	
            (d)  
 	
            Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries.
 

§4.11.  Dividend and Other Payment Restrictions Affecting Restricted Subsidiaries.  The Company shall not, and shall not permit any of its Restricted Subsidiaries to, directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance or restriction on the ability of any Restricted Subsidiary to: 

	
             
 	
            (1)
 	
            (i) pay dividends or make any other distributions to the Company or any of its Restricted Subsidiaries (A) on its Capital Stock or (B) with respect to any other interest or participation in, or measured by, its profits, or (ii) pay any Indebtedness owed to the Company or any of its Restricted Subsidiaries; 
 

	
             
 	
            (2)
 	
            make loans or advances to the Company or any of its Restricted Subsidiaries; or 
 

	
             
 	
            (3)
 	
            transfer any of its properties or assets to the Company or any of its Restricted Subsidiaries. 
 

However, the preceding restrictions will not apply to encumbrances or restrictions existing under or by reason of: 

	
             
 	
            (1)
 	
            Existing Indebtedness; 
 

	
             
 	
            (2)
 	
            the Credit Agreement as in effect as of the date of the Indenture, and any amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancing thereof, provided that such amendments, modifications, restatements, renewals, increases, supplements, refundings, replacements or refinancings are no more restrictive in the aggregate with respect to such dividend and other payment restrictions than those contained in the Credit Agreement as in effect on the date of the Indenture; 
 

	
             
 	
            (3)
 	
            the Indenture and the Notes; 
 

	
             
 	
            (4)
 	
            applicable law; 
 

	
             
 	
            (5)
 	
            any
instrument governing Indebtedness or Capital Stock of a Person acquired by the Company or any of its Restricted Subsidiaries
as in effect at the time of such 
 

 

25

 

 

 

	
             
 	
            
 	
            
acquisition (except to the extent such Indebtedness was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not applicable to any Person, or the properties or
 assets of any Person, other than the Person, or the property or assets of the Person, so acquired, provided that the EBITDA
of such Person is not taken into account in determining whether such acquisition was permitted by the terms of the Indenture;
 
 

	
             
 	
            (6)
 	
            customary non-assignment provisions in leases entered into in the ordinary course of business and consistent with past practices; 
 

	
             
 	
            (7)
 	
            restrictions on the transfer of property subject to purchase money obligations or Capital Lease Obligations otherwise permitted by clause (5) of Section 4.9 of the Indenture; 
 

	
             
 	
            (8)
 	
            permitted Refinancing Indebtedness, provided that the restrictions contained in the agreements governing such Refinancing Indebtedness are no more restrictive in the aggregate than those contained in the agreements governing the Indebtedness being refinanced; or 
 

	
             
 	
            (9)
 	
            any agreement or instrument governing Indebtedness of an Excluded Restricted Subsidiary provided that (i) at the time such agreement or instrument is entered into, such Excluded Restricted Subsidiary and its Restricted Subsidiaries have a Leverage Ratio of less than 6.5 to 1.0 and (ii) neither such Excluded Restricted Subsidiary nor any of its Restricted Subsidiaries shall, directly or indirectly, incur any Indebtedness (including Acquired Debt) unless at the time of such incurrence and after giving effect thereto, the Leverage Ratio for such Excluded Restricted Subsidiary and its Restricted Subsidiaries would be less than 6.5 to 1.0. For purposes of determining the Leverage Ratio under this clause (9) only, all references to the “Company” and its “Restricted Subsidiaries” or similar
references in the definition of “Leverage Ratio” and other defined terms necessary to determine the Leverage Ratio shall be deemed to refer to such Excluded Restricted Subsidiary and its Restricted Subsidiaries, respectively. 
 

	
             
  	
            (e)  
 	
            Transactions with Affiliates.
 

§4.12.  Transactions with Affiliates.  The Company shall not, and shall not permit any of its Restricted Subsidiaries to, sell, lease, transfer or otherwise dispose of any of its properties or assets to, or purchase any property or assets from, or enter into any contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate (each of the foregoing, an “Affiliate Transaction”), unless: 

	
             
 	
            (a)
 	
            such Affiliate Transaction is on terms that are no less favorable to the Company or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction by the Company or such Restricted Subsidiary with a non-Affiliated Person; and 
 

	
             
 	
            (b)
 	
            the Company delivers to the Trustee: 
 

	
             
 	
            (i)
 	
            with respect
to any Affiliate Transaction involving aggregate payments in excess of $5.0 million, a resolution of the Board of Directors set
forth in an Officers’ Certificate certifying that such Affiliate Transaction 
 

 

26

 

 

 

	
             
 	
            
 	
            complies with clause (a) above and such
Affiliate Transaction is approved by a majority of the disinterested members of the Board of Directors; and  
 

	
             
 	
            (ii)
 	
            with respect to any Affiliate Transaction involving aggregate payments in excess of $10.0 million, an opinion as to the fairness to the Company or such Restricted Subsidiary from a financial point of view issued by an investment banking firm of national standing. 
 

The following items shall not be deemed Affiliate Transactions and therefore, will not be subject to the provisions of the prior paragraph: 

	
             
 	
            (1)
 	
            any employment agreement entered into by the Company or any of its Restricted Subsidiaries in the ordinary course of business and consistent with the past practice of the Company or such Restricted Subsidiary; 
 

	
             
 	
            (2)
 	
            transactions between or among the Company and/or its Restricted Subsidiaries; 
 

	
             
 	
            (3)
 	
            transactions permitted by the provisions of Section 4.8 of the Indenture; and 
 

	
             
 	
            (4)
 	
            the grant of stock, stock options or other equity interests to employees and directors of the Company and any Restricted Subsidiary in accordance with duly adopted Company stock grant, stock option and similar plans. 
 

The provisions set forth in clause (b) above shall not apply to sales of inventory by the Company or any Restricted Subsidiary to any Affiliate in the ordinary course of business. The provisions of clause (b) (ii) above shall not apply to loans or advances to the Company or any Restricted Subsidiary from, or equity investments in the Company or any Restricted Subsidiary by, any Affiliate to the extent permitted by the provisions of Section 4.9 of the Indenture. 

	
             
  	
            (f)  
 	
            Certain Senior Subordinated Debt.
 

§4.13.  Certain Senior Subordinated Debt.  The Company shall not incur any Indebtedness that is subordinated or junior in right of payment to any Senior Debt of the Company and senior in any respect in right of payment to the Notes.  The Company shall not permit any Restricted Subsidiary to incur any Indebtedness that is subordinated or junior in right of payment to its Senior Debt and senior in any respect in right of payment to its Subsidiary Guarantee. 

	
             
  	
            (g)  
 	
            Additional Subsidiary Guarantees.
 

§4.14.  Additional Subsidiary Guarantees.  If any entity (other than an Excluded Restricted Subsidiary) shall become a Restricted Subsidiary after the date of the Third Supplemental Indenture, then such Restricted Subsidiary shall execute a supplemental indenture in the form of Exhibit B attached hereto, pursuant to which it shall provide a Subsidiary Guarantee and deliver an Opinion of Counsel with respect thereto, in accordance with the terms of the Indenture.

No Restricted Subsidiary (including any Excluded Restricted Subsidiary) shall consolidate with or merge with or into (whether or not such Restricted Subsidiary is the surviving Person), another Person (other than the Company) whether or not affiliated with such Restricted Subsidiary unless: 

 

27

 

 

	
             
 	
            (1)
 	
            subject to the provisions of the following paragraph, the Person formed by or surviving any such consolidation or merger (if other than such Restricted Subsidiary) assumes all the obligations of such Restricted Subsidiary under its Subsidiary Guarantee (except in the case of an Excluded Restricted Subsidiary) pursuant to a supplemental indenture in form and substance reasonably satisfactory to the Trustee; 
 

	
             
 	
            (2)
 	
            immediately after giving effect to such transaction, no Default or Event of Default exists; and 
 

	
             
 	
            (3)
 	
            such Restricted Subsidiary, or any Person formed by or surviving any such consolidation or merger, would be permitted to incur, immediately after giving effect to such transaction, at least $1.00 of additional Indebtedness pursuant to the test set forth in the first paragraph of Section 4.9 of the Indenture. 
 

In the event of: 

	
             
 	
            (1)
 	
            a sale or other disposition of all of the assets of any Restricted Subsidiary, by way of merger, consolidation or otherwise; 
 

	
             
 	
            (2)
 	
            a sale or other disposition of all of the capital stock of any Restricted Subsidiary; or 
 

	
             
 	
            (3)
 	
            the designation of a Restricted Subsidiary as an Unrestricted Subsidiary in accordance with the terms of Section 4.15 of the Indenture,
 

then such Restricted Subsidiary (in the event of a sale or other disposition, by way of such a merger, consolidation or otherwise, of all of the capital stock of such Restricted Subsidiary or in the event of the designation of such Restricted Subsidiary as an Unrestricted Subsidiary) or the Person acquiring the property (in the event of a sale or other disposition of all of the assets of such Restricted Subsidiary) will be released and relieved of any obligations under its Subsidiary Guarantee, provided that the Net Proceeds of such sale or other disposition are applied in accordance with the applicable provisions of Section 4.17 of the Indenture.

	
             
  	
            (h)  
 	
            Designation of Unrestricted Subsidiaries.
 

§4.15.  Designation of Unrestricted Subsidiaries.  The Board of Directors may designate any Subsidiary (including any Restricted Subsidiary or any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary so long as: 

	
             
 	
            (1)
 	
            neither the Company nor any Restricted Subsidiary is directly or indirectly liable for any Indebtedness of such Subsidiary; 
 

	
             
 	
            (2)
 	
            no default with respect to any Indebtedness of such Subsidiary would permit (upon notice, lapse of time or otherwise) any holder of any other Indebtedness of the Company or any Restricted Subsidiary to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity;
 

	
             
 	
            (3)
 	
            any Investment in such Subsidiary deemed to be made as a result of designating such Subsidiary an Unrestricted Subsidiary will not violate the provisions of Section 4.8 of the Indenture;
 

 

28

 

 

	
             
 	
            (4)
 	
            neither the Company nor any Restricted Subsidiary has a contract, agreement, arrangement, understanding or obligation of any kind, whether written or oral, with such Subsidiary other than (A) those that might be obtained at the time from Persons who are not Affiliates of the Company or (B) administrative, tax sharing and other ordinary course contracts, agreements, arrangements and understandings or obligations entered into in the ordinary course of business; and 
 

	
             
 	
            (5)
 	
            neither the Company nor any Restricted Subsidiary has any obligation to subscribe for additional shares of Capital Stock or other Equity Interests in such Subsidiary, or to maintain or preserve such Subsidiary’s financial condition or to cause such Subsidiary to achieve certain levels of operating results other than as permitted under Section 4.8 of the Indenture. 
 

Notwithstanding the foregoing, the Company may not designate as an Unrestricted Subsidiary any Subsidiary which, on the 1999 Indenture Date, was a Significant Subsidiary, and may not sell, transfer or otherwise dispose of any properties or assets of any such Significant Subsidiary to an Unrestricted Subsidiary, other than in the ordinary course of business, in each case other than Iron Mountain Global, Inc. and its Subsidiaries (including without limitation Iron Mountain Europe Limited and its Subsidiaries). 

The Board of Directors may designate any Unrestricted Subsidiary as a Restricted Subsidiary; provided that such designation will be deemed to be an incurrence of Indebtedness by a Restricted Subsidiary of any outstanding Indebtedness of such Unrestricted Subsidiary and such designation will only be permitted if: 

	
             
 	
            (1)
 	
            such Indebtedness is permitted under Section 4.9 of the Indenture; and 
 

	
             
 	
            (2)
 	
            no Default or Event of Default would occur as a result of such designation. 
 

	
             
  	
            (i)  
 	
            Limitation on Sale and Leaseback Transactions.
 

§4.16.  Limitation on Sale and Leaseback Transactions.  The Company will not, and will not permit any Restricted Subsidiary to, enter into any Sale and Leaseback Transaction unless: 

	
             
 	
            (1)
 	
            the consideration received in such Sale and Leaseback Transaction is at least equal to the fair market value of the property sold, as determined by a resolution of the Board of Directors; and 
 

	
             
 	
            (2)
 	
            the Company or such Restricted Subsidiary could incur the Attributable Indebtedness in respect of such Sale and Leaseback Transaction in compliance with Section 4.9 of the Indenture. 
 

	
             
  	
            (j)  
 	
            Asset Sales.
 

§4.17.  Asset Sales.  The Company shall not, and shall not permit any of its Restricted Subsidiaries to: 

	
             
 	
            (1)
 	
            
sell, lease, convey or otherwise dispose of any assets (including by way of a Sale and Leaseback Transaction, but excluding
 a Qualifying Sale and Leaseback Transaction) other than sales of inventory in the ordinary course of business (provided that
the sale, lease, conveyance or other disposition of all or substantially 
 

 

29

 

 

 

	
             
 	
             
 	
            all of the assets of the Company will be governed by
the provisions of Section 4.18 of the Indenture and/or the provisions of Section 5.1 of the Indenture and not by the provisions
of this Section 4.17); or 
 

	
             
 	
            (2)
 	
            issue or sell Equity Interests of any of its Restricted Subsidiaries 
 

that in the case of either clause (1) or (2) above, whether in a single transaction or a series of related transactions: 

	
             
 	
            (i)
 	
            have a fair market value in excess of $2.0 million; or 
 

 

	
             
 	
            (ii)
 	
            result in Net Proceeds in excess of $2.0 million (each of the foregoing, an “Asset Sale”) unless (x) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Sale at least equal to the fair market value (evidenced by an Officers’ Certificate delivered to the Trustee, and for Asset Sales having a fair market value or resulting in Net Proceeds in excess of $10.0 million, evidenced by a resolution of the Board of Directors set forth in an Officers’ Certificate delivered to the Trustee) of the assets sold or otherwise disposed of and (y) at least 75% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of cash or like-kind assets (in each case as determined in good faith by the Company,
evidenced by a resolution of the Board of Directors and certified by an Officers’ Certificate delivered to the Trustee); 
 

provided, however, that the amount of: 

	
             
 	
            (A)
 	
            any liabilities (as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto) of the Company or such Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes or any Subsidiary Guarantee) that are assumed by the transferee of any such assets; and 
 

	
             
 	
            (B)
 	
            any notes or other obligations received by the Company or such Restricted Subsidiary from such transferee that are immediately converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received) or Cash Equivalents, 
 

shall be deemed to be cash for purposes of this provision; and provided, further, that the 75% limitation referred to in the foregoing clause (ii) (y) shall not apply to any Asset Sale in which the cash portion of the consideration received therefrom is equal to or greater than what the after-tax proceeds would have been had such Asset Sale complied with the aforementioned 75% limitation. 

A transfer of assets or issuance of Equity Interests by the Company to a Wholly Owned Restricted Subsidiary or by a Wholly Owned Restricted Subsidiary to the Company or to another Wholly Owned Restricted Subsidiary will not be deemed to be an Asset Sale. 

Within 360 days of any Asset Sale, the Company may, at its option, apply an amount equal to the Net Proceeds from such Asset Sale either: 

	
             
 	
            (1)
 	
            to permanently reduce Senior Debt; or 
 

 

30

 

 

 

	
             
 	
            (2)
 	
            to an investment in a Restricted Subsidiary or in another business or capital expenditure or other long-term/tangible assets, in each case, in the same line of business as the Company or any of its Restricted Subsidiaries was engaged in on the date of the Third Supplemental Indenture or in businesses similar or reasonably related thereto. 
 

Pending the final application
of any such
Net Proceeds, the Company may temporarily reduce Senior Bank Debt or otherwise invest such Net Proceeds in
any manner that is not prohibited by the Indenture.  Any Net Proceeds from such Asset Sale that are not applied or
invested as provided in the first sentence of this paragraph will be deemed to constitute “Excess Proceeds.”
When the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company shall make an offer to all Holders
of the Notes, all holders of the 81⁄4% Notes, the 8 5/8% Notes, the 71⁄4% Notes, the 73⁄4% Notes and the 6 5/8% Notes
and the holders of any future Indebtedness ranking pari passu with the Notes,
which Indebtedness contains similar provisions requiring the Company to repurchase such Indebtedness (an “Asset Sale Offer”),
to purchase
the maximum principal amount of Notes and such other Indebtedness that may be purchased out of the Excess Proceeds, at
an offer price in cash in an amount equal to 100% of the principal amount thereof plus accrued and unpaid interest, if any,
to the date of purchase, in accordance with the procedures set forth in the Indenture.  To the extent that the aggregate amount
of Notes and other pari passu Indebtedness (including the 81⁄4% Notes, the 8 5/8% Notes,
the 71⁄4% Notes, the 73⁄4% Notes and the 6 5/8% Notes) tendered pursuant to an Asset Sale Offer is less than the Excess Proceeds, the
Company may use any remaining Excess Proceeds for general corporate purposes.  If the aggregate principal amount of Notes and such other
Indebtedness surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and such other
Indebtedness to be purchased on a pro rata basis. Upon completion of such offer to
purchase, the amount of Excess Proceeds shall be reset at zero.

The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Sale Offer.  To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.17, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Asset Sale provisions of the Indenture by virtue of such conflict.

An Asset Sale Offer shall be made pursuant to the provisions of Section 3.9 hereof.  No later than the date which is five Business Days after the date on which the aggregate amount of Excess Proceeds exceeds $10.0 million, the Company shall notify the Trustee of such Asset Sale Offer and provide the Trustee with an Officers’ Certificate setting forth the calculations used in determining the amount of Net Proceeds to be applied to the purchase of Notes.  The Company shall commence or cause to be commenced the Asset Sale Offer on a date no later than 15 Business Days after such notice (the “Commencement Date”).

	
             
  	
            (k)  
 	
            Change of Control Offer.
 

	
             
 	
            § 4.18.
 	
            Change of Control Offer.
 

(a)           Upon the occurrence of a Change of Control, each Holder of Notes shall have the right to require the Company to repurchase all or any part (equal to $1,000 or an integral multiple thereof) of such Holder’s Notes pursuant to the offer described below (the “Change of Control Offer”) at an offer price in cash equal to 101% of the aggregate principal amount thereof plus accrued and unpaid interest to but excluding the date of repurchase (the “Change of Control Payment”).

 

31

 

 

 

Within 30 calendar days following any Change of Control, the Company shall mail a notice to each Holder, with a copy to the Trustee, stating: 

	
             
 	
            (1)
 	
            that the Change of Control Offer is being made pursuant to this Section 4.18 and that all Notes tendered shall be accepted for payment; 
 

	
             
 	
            (2)
 	
            the purchase price and the purchase date, which shall be no earlier than 30 calendar days nor later than 60 calendar days from the date such notice is mailed (the “Change of Control Payment Date”); 
 

	
             
 	
            (3)
 	
            that any Note not tendered shall continue to accrue interest; 
 

	
             
 	
            (4)
 	
            that, unless the Company defaults in the payment of the Change of Control Payment, all Notes accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest on and after the Change of Control Payment Date; 
 

	
             
 	
            (5)
 	
            that Holders electing to have any Notes purchased pursuant to a Change of Control Offer shall be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, to the Paying Agent at the address specified in such notice prior to the close of business on the fifth Business Day preceding the Change of Control Payment Date; 
 

	
             
 	
            (6)
 	
            that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the second Business Day preceding the Change of Control Payment Date, facsimile transmission or letter setting forth the name of the Holder, the principal amount of Notes delivered for purchase, and a statement that such Holder is withdrawing its election to have such Notes purchased; and 
 

	
             
 	
            (7)
 	
            that Holders whose Notes are being purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered, which unpurchased portion must be equal to $1,000 in principal amount or an integral multiple thereof. 
 

The Company shall comply with the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder, to the extent such laws and regulations are applicable to the repurchase of the Notes in connection with a Change of Control.  To the extent that the provisions of any securities laws or regulations conflict with this Section 4.18, the Company shall comply with the applicable securities laws and regulations and shall not be deemed to have breached its obligations under the Change of Control provisions of the Indenture or the Third Supplemental Indenture by virtue of such conflict. 

 

(b)           On the Change of Control Payment Date, the Company shall, to the extent lawful: 

	
             
 	
            (1)
 	
            accept for payment Notes or portions thereof tendered pursuant to the Change of Control Offer; 
 

	
             
 	
            (2)
 	
            deposit with the Paying Agent an amount equal to the Change of Control Payment in respect of all Notes or portions thereof so tendered; and 
 

32

 

 

 

	
             
 	
            (3)
 	
            deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the Notes or portions thereof tendered to the Company.
 

The Paying Agent shall promptly mail to each Holder of Notes so accepted the Change of Control Payment for such Notes, and the Trustee shall promptly authenticate and mail to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note shall be in a principal amount of $1,000 or an integral multiple thereof.  Prior to complying with the provisions of this Section 4.18, but in any event within 90 calendar days following a Change of Control, the Company shall either repay all outstanding Senior Debt or obtain the requisite consents, if any, under all agreements governing outstanding Senior Debt to permit the repurchase of Notes required by this Section 4.18.  The Company shall publicly announce in The Wall Street Journal, or if no longer published, a national newspaper of general circulation, the results of
the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

The Company shall not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Section 4.18 applicable to a Change of Control Offer made by the Company and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer.

	
             
  	
            (l)  
 	
            Changes in Covenants When Notes Rated Investment Grade.
 
	
             
 	
            § 4.19.
 	
            Changes in Covenants When Notes Rated Investment Grade.
 

If on any date following the date of this Third Supplemental Indenture:

	
             
 	
            (1)
 	
            at least two of the following events occur:
 

	
             
 	
            i.
 	
            the Notes are rated Baa3 or better by Moody’s Investors Service,
 

	
             
 	
            ii.
 	
            the Notes are rated BBB- or better by Standard & Poor’s Rating Group, a division of McGraw Hill, Inc., or 
 

	
             
 	
            iii.
 	
            the Notes rated BBB- or better by Fitch Ratings, Inc.,
 

(or, if any such entity ceases to rate the Notes for reasons outside of the control of the Company, the equivalent investment grade credit rating from any other “nationally recognized statistical rating organization” within the meaning of Rule 15c3-1(c)(2)(vi)(F) under the Exchange Act selected by the Company as a replacement agency); and

	
             
 	
            (2)
 	
            no Default or Event of Default shall have occurred and be continuing,
 

then, beginning on that day and continuing at all times thereafter regardless of any subsequent changes in the rating of the Notes, Sections 3.9, 4.8, 4.9, 4.11, 4.12, 4.15 and 4.17, clause (3) of Section 4.14, clause (2) of Section 4.16 and clause (d) of Section 5.1 of the Indenture shall no longer be applicable to the Notes.

	
            Section 2.7.
 	
            Subsidiary Guarantees.
 

 

33

 

 

 

With respect to the Notes issued under this Third Supplemental Indenture, Article XII of the Indenture shall apply, and the Notes shall constitute a Series to be guaranteed by the Guarantors pursuant to Article XII of the Indenture.

	
            Section 2.8.
 	
            Legal Defeasance and Covenant Defeasance.
 

With respect to the Notes issued under this Third Supplemental Indenture, Article VIII of the Indenture shall apply, and the Company shall have the option to effect Legal Defeasance or Covenant Defeasance pursuant to Article VIII of the Indenture.  In connection with any Covenant Defeasance, the Company shall be released from its obligations under the covenants specified in Sections 4.2 and 5.1 of the Indenture and Section 2.6 of this Third Supplemental Indenture.

	
            Section 2.9.
 	
            Subordination.
 

With respect to the Notes issued under this Third Supplemental Indenture, Article XIII of the Indenture shall apply, and the Notes shall be subject to subordination pursuant to Article XIII of the Indenture.

	
            Section 2.10.
 	
            Amend, Restate and Replace Covenant Regarding Reports.  
 

With respect to the Notes issued under this Third Supplemental Indenture, Section 4.2 of the Indenture is amended, restated and replaced in its entirety by the following:

	
             
 	
            § 4.2.
 	
            Reports.
 

Whether or not required by the rules and regulations of the Commission, so long as any Notes are outstanding, the Company will furnish to the Holders of Notes:

	
             
 	
            (1)
 	
            all quarterly and annual financial information that would be required to be contained in a filing with the Commission on Forms 10-Q and 10-K if the Company were required to file such Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and, with respect to the annual information only, a report thereon by the Company’s certified independent accountants; and
 

	
             
 	
            (2)
 	
            all financial information that would be required to be included in a Form 8-K filed with the Commission if the Company were required to file such reports.
 

In addition, whether or not required by the rules and regulations of the Commission, the Company will file a copy of all such information and reports with the Commission for public availability (unless the Commission will not accept such a filing) and make such information available to investors who request it in writing.

Notwithstanding the foregoing, if at any time the Notes are guaranteed by any direct or indirect parent company of the Company, the indenture will permit the Company to satisfy its obligations under this covenant with respect to financial information relating to the Company by furnishing financial information relating to such direct or indirect parent company; provided, however, that the same is accompanied by consolidating information that explains in reasonable detail the differences between the information relating to such direct or indirect parent company and any of its Subsidiaries other than the Company and its Subsidiaries, on the one hand, and the information relating to the Company, the Guarantors and the other Subsidiaries of the Company on a standalone basis, on the other hand.

 

34

 

 

	
            Section 2.11.
 	
            Events of Default.
 

Section 6.1 of the Indenture is amended with regard to this Third Supplemental Indenture and the Notes issued hereunder by deleting the $10.0 million threshold in Sections 6.1(e)(ii) and 6.1(f) and substituting in lieu thereof the threshold of $50.0 million.

ARTICLE 3.

 

MISCELLANEOUS

	
            Section 3.1.
 	
            Effect of Headings.
 

The Article and Section headings herein are for convenience only and shall not affect the construction hereof.

	
            Section 3.2.
 	
            Successors and Assigns.
 

All covenants and agreements in this Third Supplemental Indenture by the Company shall bind its successors and assigns, whether so expressed or not.

	
            Section 3.3.
 	
            Separability Clause.
 

In case any provision in this Third Supplemental Indenture or in the Notes shall be invalid, illegal or unenforceable, the validity, legality and enforceability of the remaining provisions shall not in any way be affected or impaired thereby.

	
            Section 3.4.
 	
            Governing Law.
 

This Third Supplemental Indenture and the Notes created hereby shall be governed by and construed in accordance with the laws of the State of New York without giving effect to any conflicts of law provisions (other than Section 5-1401 of the New York General Obligations Law) that might cause this Third Supplemental Indenture and the Notes to be governed by or construed or enforced in accordance with the laws of any other jurisdiction.

	
            Section 3.5.
 	
            Third Supplement to Supersede Indenture.
 

The Indenture, as supplemented by the Third Supplemental Indenture, remains in full force and effect as of the date hereof.  Notwithstanding the foregoing, to the extent that any provision of the Indenture shall conflict with any provision of this Third Supplemental Indenture, the terms of this Third Supplemental Indenture shall be deemed controlling and the conflicting provision of the Indenture shall be null and void to the extent of such conflict.

 

[The rest of this page has been intentionally left blank.]

35

 

 

 

 

IN WITNESS WHEREOF, the parties have caused this Third Supplemental Indenture to be duly executed, and attested, all as of the date and year first written above.

	
            IRON MOUNTAIN INCORPORATED
 
	
             
 
	
            By: /s/ Garry B. Watzke
 
	
            Name:  Garry B. Watzke
 
	
            Title:    Senior Vice President and General Counsel
 
	
             
 
	
             
 
	
            COMAC, INC.
 
	
            IRON MOUNTAIN INTELLECTUAL PROPERTY 
     MANAGEMENT, INC.
 
	
            IRON MOUNTAIN GLOBAL, INC.
 
	
            IRON MOUNTAIN GOVERNMENT SERVICES 
      INCORPORATED
 
	
            IRON MOUNTAIN INFORMATION  
     MANAGEMENT, INC.
 
	
            MOUNTAIN REAL ESTATE ASSETS, INC.
 
	
            MOUNTAIN RESERVE III, INC.
 
	
            TREELINE SERVICES CORPORATION
 
	
            NETTLEBED ACQUISITION CORP.
 
	
             
 
	
             
 
	
            By: /s/ Garry B. Watzke
 
	
            Name:  Garry B. Watzke
 
	
            Title:    Senior Vice President and General Counsel
 
	
             
 

 

 

 

 

 

	
            IRON MOUNTAIN GLOBAL, LLC
 
	
             
 
	
            By:  Iron Mountain Global, Inc., its sole member
 
	
             
 
	
            By: /s/ Garry B. Watzke
 
	
            Name:  Garry B. Watzke
 
	
            Title:    Senior Vice President and
 
	
            General Counsel
 

 

 

 

 

 

 

	
            IRON MOUNTAIN STATUTORY TRUST - 1998
 
	
             
 
	
            By:    U.S. BANK NATIONAL ASSOCIATION, not
 individually but as Owner Trustee under that certain 
 Amended and Restated Owner Trust Agreement dated 
 as of October 1, 1998, as amended
 
	
             
 
	
             
 
	
            By:  /s/ Timothy A. Donmoyer
 
	
            Name:  Timothy A. Donmoyer
 
	
            Title:    Vice President
 
	
             
 
	
             
 
	
            IRON MOUNTAIN STATUTORY TRUST - 1999
 
	
             
 
	
            By:    U.S. BANK NATIONAL ASSOCIATION, not 
 individually but as Owner Trustee under that certain 
 Owner Trust Agreement dated as of July 1, 1999, as 
 amended
 
	
             
 
	
             
 
	
            By:  /s/ Timothy A. Donmoyer
 
	
            Name:  Timothy A. Donmoyer
 
	
            Title:    Vice President
 

 

 

	
            THE BANK OF NEW YORK TRUST COMPANY, N.A.
 
	
             
 
	
             
 
	
            By:  /s/ Chi C. Ma
 
	
            Name:  Chi C. Ma
 
	
            Title:    Vice President
 

 

 

 

EXHIBIT A

 

FORM OF NOTES

 

 

[Face of Note]

83⁄4 % Senior Subordinated Notes due 2018

	
            CUSIP No.  46284P AH 7
 	
            $200,000,000
 

IRON MOUNTAIN INCORPORATED

promises to pay to CEDE & Co. or registered assigns, the principal sum of $200 Million Dollars on July 15, 2018.

Interest Payment Dates:  January 15 and July 15

Record Dates:  January 1 and July 1

Dated:  July 17, 2006

IRON MOUNTAIN INCORPORATED

	
             
 	
            By:  __________________
 
	
             
 	
            Name:
 
	
             
 	
            Title:
 

 

	
             
 	
            By:  __________________
 
	
             
 	
            Name:
 
	
             
 	
            Title:
 

 

(SEAL)

This is one of the Notes

referred to in the within-

mentioned Indenture:

 

THE BANK OF NEW YORK TRUST COMPANY, N.A.,

as Trustee

	
            By:_______________________________
      Authorized Signature
 	
                                                      
                    
 
	
             
 	
            
 	
             

				

 

 

 

 

 

 

83⁄4 % Senior Subordinated Notes due 2018

This Security is a Global Security within the meaning of the Indenture hereinafter referred to and is registered in the name of the Depository or a nominee of the Depository.  This Security is exchangeable for Securities registered in the name of a Person other than the Depository or its nominee only in the limited circumstances described in the Indenture, and may not be transferred except as a whole by the Depository to a nominee of the Depository, by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such a successor Depository.

Unless and until it is exchanged in whole or in part for Notes in definitive form, this Note may not be transferred except as a whole by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository.  Unless this certificate is presented by an authorized representative of The Depository Trust Company (55 Water Street, New York, New York) (“DTC”), to the issuer or its agent for registration of transfer, exchange or payment, and any certificate issued is registered in the name of Cede & Co. or such other name as may be requested by an authorized representative of DTC (and any payment is made to Cede & Co. or such other entity as may be requested by an authorized representative of DTC), ANY
TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL inasmuch as the registered owner hereof, Cede & Co., has an interest herein.

Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

1.            INTEREST.  Iron Mountain Incorporated, a Delaware corporation (the “Company”) promises to pay interest on the principal amount of this Note at 83⁄4 % per annum from July 17, 2006 until July 15, 2018.  The Company shall pay interest, semi-annually in arrears on January 15 and July 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an “Interest Payment Date”).  Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of issuance; provided that if there is no existing Default in the payment of interest, and if this Note is authenticated between a record
date referred to on the face hereof and the next succeeding Interest Payment Date, interest shall accrue from such next succeeding Interest Payment Date; provided, further, that the first Interest Payment Date shall be January 15, 2007.  The Company shall pay interest (including post-petition interest to the extent allowed in any proceeding under any Bankruptcy Law) on overdue principal from time to time on demand at a rate equal to the per annum rate on the Notes then in effect; it shall pay interest (including post-petition interest to the extent allowed in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.

2.            METHOD OF PAYMENT.  The Company will pay principal, premium, if any, and interest on the Notes in money of the United States that at the time of payment is legal tender for payment of public and private debts.  The Company, however, may pay principal, premium, if any, and interest by check payable in such money.  It may mail an interest check to a Holder’s registered address.

3.            PAYING AGENT, REGISTRAR AND SERVICE AGENT.  Initially, The Bank of New York Trust Company, N.A., the Trustee under the Indenture, will act as paying agent, registrar and service agent.  The Notes may be presented for registration of transfer and exchange at the offices of the 

 

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registrar.  The Company may change any paying agent, service agent or registrar without notice to any Holder.  The Company or any of its Subsidiaries may act in any such capacity.

4.            INDENTURE.  The Company issued the Notes under an Indenture dated as of December 30, 2002 (the “Base Indenture”), as supplemented by a Third Supplemental Indenture dated as of July 17, 2006 (the “Third Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), among the Company, the Guarantors and the Trustee.  The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb).  The Notes are subject to all such terms, and Holders are referred to the Indenture and such Act for a statement of such terms.  To the extent any provision of this Note conflicts with the
express provisions of the Indenture, the provisions of the Indenture shall govern and be controlling.  The Notes issued under the Indenture are subordinated unsecured obligations of the Company limited to $200,000,000 in aggregate principal amount.

5.            OPTIONAL REDEMPTION.  Prior to July 15, 2011, the Notes shall be subject to redemption at any time at the option of the Company, in whole or in part, upon not less than 10 nor more than 60 days’ notice, at the Make-Whole Price, plus accrued and unpaid interest, to but excluding the applicable redemption date.  On and after July 15, 2011, the Notes will be subject to redemption at any time at the option of the Company, in whole or in part, upon not less than 10 nor more than 60 days’ notice, at the redemption price (expressed as percentages of principal amount) set forth below, plus accrued and unpaid interest to but excluding the applicable redemption date, if redeemed during the twelve-month period beginning on July 1
of the years indicated below: 

	
            Year
 	
            Percentage
 
	
             
 	
             
 
	
            2011                                                                                                                                                                                                                                                                                                                                                                                                                                             
 	
            104.375%
 
	
            2012                                                                                                                                                                                                                                                                                                                                                                                                                                             
 	
            102.917%
 
	
            2013                                                                                                                                                                                                                                                                                                                                                                                                                                             
 	
            101.458%
 
	
            2014 and thereafter                                                                                                                                                                                                                                                                                                                                                      
 	
            100.000%
 
	
             
 	
             
 

 

Notwithstanding the foregoing, at any time prior to July 15, 2009 the Company may on any one or more occasions redeem the Notes at a redemption price of 108.75% of the principal amount thereof, plus accrued and unpaid interest, and Liquidated Damages if any, to the redemption date, with the net cash proceeds of one or more Qualified Equity Offerings; provided that (i) at least $130.0 million in the aggregate principal amount of the Notes (including any Additional Notes) issued under the Indenture remains outstanding immediately after the occurrence of such redemption (excluding Notes held by the Company and the Company’s Subsidiaries) and (ii) the redemption must occur within six months of the date of the closing of any such Qualified Equity Offering.

6.            NOTICE OF REDEMPTION.  Notice of redemption will be mailed at least 10 days but not more than 60 days before the redemption date to each Holder of the Notes to be redeemed at such Holder’s address of record.  The Notes in denominations larger than $1,000 may be redeemed in part but only in integral multiples of $1,000, unless all the Notes held by a Holder are to be redeemed.  In the event of a redemption of less than all of the Notes, the Notes will be chosen for redemption by the Trustee in accordance with the Indenture.  On and after the redemption date, interest ceases to accrue on the Notes or portions of them called for redemption.

If this Note is redeemed subsequent to a Record Date with respect to any Interest Payment Date specified above and on or prior to such Interest Payment Date, then any accrued interest will be paid to the Person in whose name this Note is registered at the close of business on such Record Date.

 

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7.            MANDATORY REDEMPTION.  Except as set forth in paragraph 8 below, the Company shall not be required to repurchase or to make mandatory redemption payments with respect to the Notes.  There are no sinking fund payments with respect to the Notes.

8.            REPURCHASE AT OPTION OF HOLDER.  This Note is subject to purchase at the option of the Holder upon the circumstances set forth in Sections 3.9, 4.17 and 4.18 of the Indenture.

9.            SUBORDINATION. The payment of the principal of, interest on or any other amounts due on the Notes is subordinated in right of payment to all existing and future Senior Debt of the Company, as described in the Indenture.  Each Holder, by accepting a Note, agrees to such subordination and authorizes and directs the Trustee on its behalf to take such action as may be necessary or appropriate to effectuate the subordination so provided and appoints the Trustee as its attorney-in-fact for such purpose.

10.          DENOMINATIONS, TRANSFER, EXCHANGE.  The Notes are in registered form without coupons in minimum denominations of $1,000 and integral multiples of $1,000 in excess thereof.  The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture.  The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Company may require a Holder to pay any taxes and fees required by law or permitted by the Indenture.  The Company need not exchange or register the transfer of any Note or portion of a Note selected for redemption, except for the unredeemed portion of any Note being redeemed in part.  Also, the Company need not exchange or register
the transfer of any Notes for a period of 15 days before a selection of Notes to be redeemed or during the period between a record date and the corresponding Interest Payment Date.

11.          PERSONS DEEMED OWNERS.  The registered Holder of a Note may be treated as its owner for all purposes.

12.          AMENDMENT, SUPPLEMENT AND WAIVER.  Subject to certain exceptions, the Indenture with respect to the Notes or the Notes may be amended or supplemented with the written consent of the Holders of a majority in principal amount of the Notes and any existing default or compliance with any provision of the Indenture with respect to the Notes or the Notes may be waived with the consent of the Holders of a majority in principal amount of the Notes (including, in each case, Additional Notes, if any).  Without the consent of any Holder of the Notes, the Indenture with respect to the Notes or the Notes may be amended or supplemented to, in addition to other events more fully described in the Indenture, cure any ambiguity, defect
or inconsistency, provide for uncertificated Notes in addition to or in place of certificated Notes, provide for the assumption of the Company’s obligations to Holders of the Notes in the case of a merger or consolidation, make any change that would provide any additional rights or benefits to the Holders of the Notes or that does not adversely affect the legal rights under the Indenture of any such Holder, or comply with requirements of the SEC in order to effect or maintain the qualification of the Indenture under the TIA.

13.          DEFAULTS AND REMEDIES.  An Event of Default with respect to the Notes occurs upon the occurrence of any of the following events: the default for 30 days in the payment when due of interest on the Notes (whether or not prohibited by the subordination provisions of the Indenture); the default in payment when due of the principal of or premium, if any, on the Notes (whether or not prohibited by the subordination provisions of the Indenture); the failure by the Company to comply with Section 4.18 of the Indenture; the failure by the Company or any Guarantor for 60 days after written notice from the Trustee or Holders of not less than 25% of the aggregate principal amount of the Notes (including Additional Notes, if any) outstanding to
comply with any of its other agreements in the Indenture, Notes or the Subsidiary Guarantees; the default under any mortgage, indenture or instrument under which there may be issued or by which there may be secured or evidenced any Indebtedness for 

 

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money borrowed by the Company or any of its Restricted Subsidiaries (or the payment of which is guaranteed by the Company or any of its Restricted Subsidiaries) whether such Indebtedness or guarantee exists on the date of the Indenture or is created thereafter, if: (i) such default results in the acceleration of such Indebtedness prior to its express maturity or shall constitute a default in the payment of such Indebtedness at final maturity of such Indebtedness; and (ii) the principal amount of any such Indebtedness that has been accelerated or not paid at maturity, when added to the aggregate principal amount of all other such Indebtedness that has been accelerated or not paid at maturity, exceeds $10.0 million; the failure by the Company or any of its Restricted Subsidiaries to pay final judgments aggregating in excess of $10.0 million, which judgments remain unpaid, undischarged or unstayed for a
period of 60 days; certain events of bankruptcy or insolvency with respect to the Company or any of its Restricted Subsidiaries that is a Significant Subsidiary; or except as permitted by the Indenture or the Subsidiary Guarantees, any Subsidiary Guarantee issued by a Restricted Subsidiary shall be held in any judicial proceeding to be unenforceable or invalid or shall cease for any reason to be in full force and effect, or any Restricted Subsidiary or any Person acting on behalf of any Restricted Subsidiary shall deny or disaffirm in writing its obligations under its Subsidiary Guarantee.

If any Event of Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes (including Additional Notes, if any) may declare all the Notes to be due and payable immediately; provided, however, that if any Obligation with respect to Senior Bank Debt is outstanding pursuant to the Credit Agreement upon a declaration of acceleration of the Notes, the principal, premium, if any, and interest on the Notes will not be payable until the earlier of: (1) the day which is five business days after written notice of acceleration is received by the Company and the Credit Agent; or (2) the date of acceleration of the Indebtedness under the Credit Agreement. Notwithstanding the foregoing, in the case of an Event of Default arising from certain events of bankruptcy or insolvency with respect to the Company or any Restricted Subsidiary
that is a Significant Subsidiary, the principal of, and premium, if any, and any accrued and unpaid interest on all outstanding Notes will become due and payable without further action or notice.  In the event of a declaration of acceleration of the Notes because an Event of Default has occurred and is continuing as a result of the acceleration of any Indebtedness described in Section 6.1(e) of the Indenture, the declaration of acceleration of the Notes shall be automatically annulled if the holders of any Indebtedness described in such section have rescinded the declaration of acceleration in respect of such Indebtedness within 30 days from the date of such declaration and if: (1) the annulment of the acceleration of the Notes would not conflict with any judgment or decree of a competent jurisdiction; and (2) all existing Events of Default, except non-payment of principal or interest on the Notes that became due solely because of the acceleration of the Notes, have been cured or
waived. 

Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Holders of the Notes notice of any continuing Default or Event of Default (except a Default or Event of Default relating to the payment of principal or interest) if it determines that withholding notice is in their interest.  The Company is required to deliver to the Trustee annually a statement regarding compliance with the Indenture, and the Company is required, upon becoming aware of any Default or Event of Default, to deliver to the Trustee a statement specifying such Default or Event of Default and what action the Company is taking or proposes to take thereto.

14.          SUBSIDIARY GUARANTEES.  Payment of principal of, premium, if any, and interest (including interest on overdue principal, if any, and interest, if lawful) on the Notes is guaranteed on an unsecured, senior subordinated basis by the Guarantors pursuant to Article XII of the Indenture.

15.          TRUSTEE DEALINGS WITH COMPANY.  The Trustee, in its individual or any other capacity, may make loans to, accept deposits from, and perform services for the Company or its Affiliates, and may otherwise deal with the Company or its Affiliates, as if it were not the Trustee.

 

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16.          NO RECOURSE AGAINST OTHERS.  No past, present or future director, officer, employee, incorporator or stockholder, as such, of the Company or any Guarantor shall have any liability for any obligations of the Company or any Guarantor under the Notes, the Subsidiary Guarantees or the Indenture or for any claim based on, in respect of or by reason of such obligations or their creation.  Each Holder by accepting a Note and the related Subsidiary Guarantees waives and releases all such liability.  The waiver and release are part of the consideration for the issuance of the Notes.

17.          AUTHENTICATION.  This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

18.          ABBREVIATIONS.  Customary abbreviations may be used in the name of a Holder or an assignee, such as:  TEN COM (= tenants in common), TEN ENT (= tenants by the entireties), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

19.          CUSIP NUMBERS.  Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Company has caused CUSIP numbers to be printed on the Notes and the Trustee may use CUSIP numbers in notices of redemption as a convenience to Holders.  No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

The Company shall furnish to any Holder upon written request and without charge a copy of the Indenture.  Requests may be made to:

Iron Mountain Incorporated

745 Atlantic Avenue

Boston, Massachusetts 02111

Attention:  Chief Financial Officer

 

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ASSIGNMENT FORM

To assign this Note, fill in the form below:  (I) or (we) assign and transfer this Note to 

 

                                          
                                          
                                          
                                          

	
             
 	
            (Insert assignee’s soc. sec. or  tax I.D. no.)
 

 

                                          
                                          
                                          
                                          

 

                                          
                                          
                                          
                                          

 

                                          
                                          
                                          
                                          

 

                                          
                                          
                                          
                                          

	
             
 	
            (Print or type assignee’s name, address and zip code)
 

 

and irrevocably appoint                                           
                                          
                                          
     

to transfer this Note on the books of the Company.  The agent may substitute another to act for him.

 

                                          
                                          
                                          
                                          

 

Date:  __________

 

Your Signature:                                            
                                          
                                          
                  

(Sign exactly as your name appears on the face of this Note)

 

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OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Note purchased by the Company pursuant to Section 4.17 or 4.18 of the Indenture, check the box below:

	
             
 	
            [  
 	
            ]
 	
            Section 4.17
 
	
             
 	
            [  
 	
            ]
 	
            Section 4.18
 

If you want to elect to have only part of the Note purchased by the Company pursuant to Section 4.17 of the Indenture, state the amount you elect to have purchased:  $__________

	
            Date:  __________
 	
            Your Signature:  ___________________________
 
	
             
 	
            (Sign exactly as your name appears on the Note)
 
	
             
 	
             
 
	
             
 	
            Tax Identification No.:  ______________________
 

 

 

 

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SCHEDULE OF EXCHANGES OF NOTES*

The following exchanges of a part of this Global Note for other Notes have been made:

	
            
Date of Exchange
 
 	
            
Amount of decrease in Principal Amount of this Global Note
 
 	
            
Amount of increase in Principal Amount of this Global Note
 
 	
            
Principal Amount of this Global Note following such decrease (or increase)
 
 	
            
Signature of authorized office 
 of Trustee or Service Agent
 
 
	
             
 	
             
 	
             
 	
             
 	
             
 

 

_________________________

* This schedule should be included only if the Note is issued in global form.

 

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EXHIBIT B

FORM OF SUPPLEMENTAL INDENTURE

TO BE DELIVERED BY FUTURE GUARANTORS

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of ________________, 20__, among _______________ (the “Guaranteeing Subsidiary”), a subsidiary of Iron Mountain Incorporated (or its successor), a Delaware corporation (the “Company”), the Company, and The Bank of New York Trust Company, N.A., a national banking association, as trustee under the Indenture referred to below (the “Trustee”).

W I T N E S S E T H

WHEREAS, the Company has heretofore executed and delivered to the Trustee an indenture, dated as of December 30, 2002, as supplemented by the Third Supplemental Indenture, dated as of July 17, 2006 (the indenture, as so supplemented, the “Indenture”) providing for the issuance of an aggregate principal amount of up to $200,000,000 of 83⁄4 % Senior Subordinated Notes due 2018 (the “Notes”);

WHEREAS, the Indenture provides that under certain circumstances the Guaranteeing Subsidiary shall execute and deliver to the Trustee a supplemental indenture pursuant to which the Guaranteeing Subsidiary shall unconditionally guarantee all of the Company’s obligations under the Notes and the Indenture on the terms and conditions set forth herein (the “Note Guarantee”); and

WHEREAS, pursuant to Section 9.1 of the Indenture, the Trustee is authorized to execute and deliver this Supplemental Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guaranteeing Subsidiary and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows:

1.            CAPITALIZED TERMS.  Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

2.            AGREEMENT TO GUARANTEE.  The Guaranteeing Subsidiary hereby agrees that its obligations to the Holder and the Trustee pursuant to this Subsidiary Guarantee shall be as expressly set forth in Article XII of the Indenture and in such other provisions of the Indenture as are applicable to the Guarantors (including, without limitation, Article XIII of the Indenture), and reference is made to the Indenture for the precise terms of this Supplemental Indenture.  The terms of Article XII of the Indenture and such other provisions of the Indenture (including, without limitation, Article XIII of the Indenture) as are applicable to the Guarantors are incorporated herein by reference.

3.            EXECUTION AND DELIVERY OF SUBSIDIARY GUARANTEES.

(a)           If an Officer whose signature is on this Supplemental Indenture no longer holds that office at the time the Trustee authenticates the Note, the Subsidiary Guarantee shall be valid nevertheless.

(b)           The delivery of any Note by the Trustee, after the authentication thereof under the Indenture, shall constitute due delivery of the Subsidiary Guarantee set forth in this Supplemental Indenture on behalf of the Guaranteeing Subsidiary.

 

 

 

 

4.            NO RECOURSE AGAINST OTHERS.  No past, present or future director, officer, employee, incorporator or stockholder of the Guaranteeing Subsidiary, as such, shall have any liability for any obligations of the Company or any Guarantor (including the Guaranteeing Subsidiary) under the Notes, any Subsidiary Guarantee, the Indenture or this Supplemental Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.  Each Holder of the Notes by accepting a Note waives and releases all such liability.  The waiver and release are part of the consideration for issuance of the Notes.  

5.            NEW YORK LAW TO GOVERN.  THE INTERNAL LAW OF THE STATE OF NEW YORK SHALL GOVERN AND BE USED TO CONSTRUE THIS SUPPLEMENTAL INDENTURE BUT WITHOUT GIVING EFFECT TO APPLICABLE PRINCIPLES OF CONFLICTS OF LAW TO THE EXTENT THAT THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION WOULD BE REQUIRED THEREBY.

6.            COUNTERPARTS.  The parties may sign any number of copies of this Supplemental Indenture.  Each signed copy shall be an original, but all of them together represent the same agreement.

7.            EFFECT OF HEADINGS.  The Section headings herein are for convenience only and shall not affect the construction hereof.

8.            THE TRUSTEE.  The Trustee shall not be responsible in any manner whatsoever for or in respect of the validity or sufficiency of this Supplemental Indenture or for or in respect of the recitals contained herein, all of which recitals are made solely by the Guaranteeing Subsidiary and the Company.

	
             
 	
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IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed and attested, all as of the date first above written.

Dated:  _______________, 20___

[GUARANTEEING SUBSIDIARY]

 

	
             
 	
            By:
 	
                                                      
                              
 

Name:

Title:

[COMPANY]

	
             
 	
            By:
 	
                                                      
                              
 

Name:

Title:

 

[TRUSTEE],

  as Trustee

	
             
 	
            By:
 	
                                                      
                              
 
	
             
 	
            Authorized Signatory
 	
             

					

 

 

 

	
             
 	
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