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the cost or potential liabilities associated with real estate necessary for our business;



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the performance of business partners upon whom we depend for technical assistance or management expertise outside the U.S.;



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changes in the political and economic environments in the countries in which our international subsidiaries operate;



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claims that our technology violates the intellectual property rights of a third party;



•

the cost of our debt;



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the impact of alternative, more attractive investments on dividends;



•

our ability or inability to complete acquisitions on satisfactory terms and to integrate acquired companies efficiently; and



•

other trends in competitive or economic conditions affecting our financial condition or results of operations not presently contemplated.

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        Other risks may adversely impact us, as described more fully under "Item 1A. Risk Factors."Factors" of this Annual Report.

        You should not rely upon forward-looking statements except as statements of our present intentions and of our present expectations, which may or may not occur. You should read these cautionary statements as being applicable to all forward-looking statements wherever they appear. Except as required by law, we undertake no obligation to release publicly the result of any revision to these forward-looking statements that may be made to reflect events or circumstances after the date hereof or to reflect the occurrence of unanticipated events. Readers are also urged to carefully review and consider the various disclosures we have made in this document, as well as our other periodic reports filed with the Securities and Exchange Commission (the "Commission" or "SEC").SEC.

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PART I

Item 1. Business.

A.    Development of Business.

        We are a leadingstore records, primarily paper documents and data backup media, and provide information management services company. Wethat help organizations around the world reduce the risks,protect their information, lower storage rental costs, comply with regulations, enable corporate disaster recovery, and inefficiencies associated with storing and usingbetter use their physical and digital data.information for business advantages, regardless of its format, location or lifecycle stage. We offer comprehensive records management services, data protection & recovery services and information destruction services, along with the expertise and experience to address complex storage and information management challenges such as rising storage rental costs, and increased litigation, regulatory compliance and disaster recovery.recovery requirements. Founded in an underground facility near Hudson, New York in 1951, Iron Mountain Incorporated, a Delaware corporation, is a trusted partner to more than 140,000 corporate155,000 clients throughout North America, Europe, Latin America and Asia Pacific. We have a diversified customer base comprisedconsisting of commercial, legal, banking, healthcare, accounting, insurance, entertainment and government organizations, including more than 97%94% of the Fortune 1000 and more than 93% of the FTSE 100.1000. As of December 31, 2009,2012, we provided servicesoperated over 1,000 facilities, comprising 64.5 million square feet, in 3835 countries on five continents and employed over 20,000 people and operated more than 1,000 facilities.17,500 people.

        Now in our 59th62^nd year, we have experienced tremendous growth, particularly since successfully completing the initial public offering of our common stock in February 1996. We have grown from a U.S. business operating fewer than 85 facilities (6 million square feet) with limited productstorage and information management service offerings and annual revenues of $104$104.0 million in 1995 into a global enterprise providing storage and a broad range of related information management services to customers in markets around the world with over 1,000 facilities (64.5 million square feet) and total revenues of $3more than $3.0 billion for the year ended December 31, 2009.2012. On January 5, 2009, we were added to the S&P 500 Index, and as of December 31, 2012 we are currentlywere number 681644 on the Fortune 1000.

        Our success since becoming a public company in 1996 has been driven in large part by our execution of a consistent long-term growth plan to build marketindustry leadership by extending our strategic positionpresence through service line and global expansion. This growth plan has been sequenced into three phases. The first phase involved establishing leadership and broad market access in our core businesses:storage solutions and related records management services and data protection & recovery services, primarily through acquisitions. In the second phase, we invested in building a successful selling organization to access new customers, converting previously unvended demand. While different parts of our business are in different stages of evolution along our three-phase strategy, as an enterprise,in North America and our more developed international markets, we have transitioned to the third phase of our growth plan, which we call the capitalization phase. In this phase, which we expect will runto continue for a long time to come,many years, we seek to expand our relationships with our customers to continue solving their increasingly complex storage and information management problems. Doing this wellGrowing our customer relationships means expanding our global storage and service offerings on a global basis while maximizing our solid core businesses. In doing this, we continue to build what we believe to be a very durable business through disciplined execution.

        Consistent with this strategy,model, we have transitioned from a growth strategy driven primarily by acquisitions of storage and information management services companies to expansion driven primarily by internala growth strategy that includes multiple sources of revenue growth. In 2001, internalThese sources of revenue growth exceededinclude: (i) organic growth throughcomprised of growth from existing customers, sales to new customers and acquiring customer relationships from third-parties; (ii) acquisitions forof storage and information management services businesses; and (iii) the first time since we began our acquisition program in 1996. This has continued to be the case in each year since 2001 with the exceptionintroduction of 2004. In the absence of unusual acquisition activity, wenew rental streams and ancillary services.

        We expect to achieve more of our revenuelong-term growth internally in 2010goals by focusing on expanding our global core storage rental business through increased incoming volumes and beyond.

        In February, 2010, we acquired Mimosa Systems, Inc. ("Mimosa"), a leader in enterprise-class digital content archiving solutions, for approximately $112 million in cash. Mimosa, based in Santa Clara, California, provides an on-premisesby offering our customers integrated archive for email, SharePoint data and files, and complements our existing enterprise-class, cloud-based digital archive services. NearPoint®, Mimosa's enterprise archiving platform, has applications for retention and disposition, electronic discovery ("eDiscovery"), compliance supervision, classification, recovery, and end-user search, enabling customers to reduce risk, and lower their eDiscovery and storage costs.services

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that address their increasingly complex storage and information management needs regardless of the format, location or lifecycle stage of their information. Storage rental is the key driver of our economics and allows us to expand our relationships with our customers through value-added services that flow from storage rental. Consistent with our overall strategy, we are focused on increasing incoming volumes on a global basis. There are multiple sources of new volumes available to us, and these sources inform our growth investment strategy. Our investments in sales and marketing support sales to new customers that do not currently outsource some or all of their storage and information management needs, as well as increased volumes from existing customers. We also expect to invest in the acquisitions of customer relationships and acquisitions of storage and information management services businesses. In North America and our more developed international markets, we expect that these acquisitions will primarily be fold-in acquisitions designed to optimize the utilization of existing assets, expand our presence and better serve customers. We also expect to use acquisitions to expand our presence in attractive, higher growth emerging markets. Finally, we are continuing to add new rental streams and ancillary services to our portfolio to support our long-term growth objectives and drive solid returns on invested capital.

        At this stage in our evolution we also are focused on driving increased profitability and cash flow through a disciplined management approach and a focus on optimizing our business operations. Consisting of productivity initiatives, pricing program improvements and cost controls, our optimization strategy has produced significant and visible results. Between 2006 and 2010, we had compounded annual growth rates of 11% for Adjusted OIBDA, defined as operating income before (1) depreciation and amortization, (2) intangible impairments, (3) (gain) loss on disposal/write-down of property, plant and equipment, net and (4) costs associated with our 2011 proxy contest, the work of the Strategic Review Special Committee of our board of directors (the "Special Committee") and the proposed REIT conversion, discussed below (collectively "REIT Costs"), 17% for Adjusted Earnings per Share from Continuing Operations and 3% for Earnings per Share from Continuing Operations. During that same period, we reduced our capital expenditures (excluding real estate) as a percent of revenues from 13.4% in 2006 to 7.9% in 2010. These gains were driven primarily by cost reductions and the optimization of our North American Business segment as we increased Adjusted OIBDA margins in that segment by nearly 800 basis points between 2006 and 2010. Our current focus is on sustaining the high margin, high profitability levels of the North American Business segment while optimizing our International Business segment using the same strategies. We expect to achieve 25% Adjusted OIBDA margins in the International Business segment by the end of 2013, a 700 basis points improvement over 2010 levels. Beyond 2013, we expect to grow consolidated Adjusted OIBDA margins at a much slower rate because we will have already completed the major profit improvement initiatives in both the North American and International Business segments. In our internal revenuemore developed markets, continuous improvement initiatives will generate modest margin improvement, a portion of which we expect to reinvest in our business. In our emerging markets, margins should expand as the local businesses mature, and we will look to reinvest a portion of that improvement to support the growth objectives primarily throughof these businesses. For more detailed definitions and reconciliations of Adjusted OIBDA and Adjusted Earnings per Share from Continuing Operations and a sophisticated salesdiscussion of why we believe these measures provide relevant and account management coverage model. This model is designeduseful information to drive incremental revenues by acquiring new customer relationshipsour current and increasing business with newpotential investors, see "Item 7. Management's Discussion and existing customers by selling them our productsAnalysis of Financial Condition and services in new geographies and selling additional products and services such as information destruction, digital data protection, document management services and eDiscovery services.Results of Operations—Non-GAAP Measures" of this Annual Report.

        We intend our selling effortsare committed to be augmenteddelivering stockholder value. To that end, and supported by expanded marketing programs,our increased profitability and strong cash flows, we initiated a stockholder payout program in February 2010 consisting of a share repurchase authorization of up to $150.0 million and a dividend policy under which include product managementwe have paid, and in the future intend to pay, cash dividends on our common stock. Our first ever quarterly cash dividend, declared in March 2010, was $0.0625 per share. Subsequently, our board of directors approved an increase in the amount authorized under our share repurchase program of up to an additional $1.05 billion, bringing the total authorization to $1.2 billion. As of December 31, 2012,

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we have purchased 37.7 million shares of our common stock for approximately $1.1 billion under this program. We have also increased our quarterly dividend on three occasions, including most recently in June 2012, when we announced an 8% increase to our regular quarterly dividend payments through 2013. The June 2012 increase to our quarterly dividend, to $0.27 per share, represented a 332% increase over the quarterly dividend amount declared in March 2010.

        In April 2011, we announced a three-year strategic plan to increase stockholder value. The key components of our plan are: (i) sustaining a leadership position in our North American Business segment; (ii) driving substantial improvements in our International Business segment; and (iii) committing to significant stockholder payouts of $2.2 billion through 2013, with $1.2 billion being paid out by May 2012. We fulfilled the commitment to return $1.2 billion of capital to stockholders by May 2012. The remaining $1.0 billion of the stockholder payout plan has been replaced by our regular quarterly dividends and the stockholder distributions and expenditures associated with our plan to convert to a REIT (the "Conversion Plan"). As part of our strategic plan, in June 2011, we completed the sale of our online backup and recovery, digital archiving and eDiscovery solutions businesses (the "Digital Business") for approximately $395.4 million in cash. Additionally, in connection with our strategic portfolio review of certain international operations, we sold our New Zealand operations in October 2011, and we sold our Italian operations in April 2012.

Potential REIT Conversion

        In June 2012, we announced our intention to pursue conversion to a REIT. The plan to convert to a REIT was unanimously approved by our board of directors following a thorough analysis and careful consideration of ways to maximize value through alternative financing, capital and tax strategies. Assuming we are successful in converting, we would plan to elect REIT status no sooner than our taxable year beginning January 1, 2014. Any REIT election made by us must be effective as of the beginning of a taxable year; therefore, if, as a core discipline.calendar year taxpayer, we are unable to convert to a REIT by January 1, 2014, the next possible conversion date would be January 1, 2015.

        Our Conversion Plan currently includes submitting requests for private letter rulings ("PLR") to the U.S. Internal Revenue Service (the "IRS"). Our PLR requests have multiple components, and the conversion to a REIT will require favorable rulings from the IRS on numerous technical tax issues, including the characterization of our racking assets as real estate. We submitted our PLR requests to the IRS during the third quarter of 2012, but the IRS may not provide a favorable response to our PLR requests until the second half of 2013 or at all.

        Our ability to qualify as a REIT will depend upon our continuing compliance following our conversion to a REIT with various requirements, including requirements related to the nature of our assets, the sources of our income and the distributions to our stockholders. If we fail to qualify as a REIT, we will be subject to U.S. federal income tax at regular corporate rates. Even if we qualify for taxation as a REIT, we may be subject to some federal, state, local and foreign taxes on our income and property. In particular, while state income tax regimes often parallel the U.S. federal income tax regime for REITs described above, many states do not completely follow U.S. federal rules and some may not follow them at all.

        We believe that electing REIT status will maximize our enterprise value as we advance our strategy and provide significant benefits to our stockholders. A key component of our overall strategic plan is our capital allocation strategy to return excess cash to our stockholders, and we believe operating as a REIT aligns well with this strategy. In November 2012, we paid a $700.0 million special dividend (the "Special Dividend") representing the initial distribution to satisfy the requirement that we pay to stockholders our accumulated earnings and profits which is estimated to be approximately $1.0 billion to $1.5 billion (the "E&P Distribution") in connection with our potential conversion to a REIT. The Special Dividend consisted of $140.0 million paid in cash and $560.0 million in common stock value.

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We issued 17.0 million new shares in connection with the Special Dividend. We also planbelieve that through conversion to continue developing an extensive worldwide networka REIT we may be able to expand our shareholder base and lower our cost of channel partnersfinancing through which we are sellingincreased ownership of currently leased real estate. We expect our long-term capital allocation strategy as a wide arrayREIT will naturally shift toward increased use of technology solutions. Our salesequity to support lower leverage, though our leverage may increase in the short-term to fund the costs to support the Conversion Plan.

        See Item 7. "Management's Discussion and account coverage modelAnalysis of Financial Condition and Results of Operations—Overview" and "—Liquidity and Capital Resources" of this Annual Report for more information regarding our go-to-market strategy will continuepossible conversion to evolvea REIT, including anticipated costs associated with the Conversion Plan, and Item 1A. "Risk Factors—Risks Related to meet the needsProposed REIT Conversion" of this Annual Report for a discussion of risks associated with our customers.conversion to a REIT, including impediments to a conversion.

B.    Description of Business.

Overview

        We provide cost-effective secure storage for all major media, including paper (which is the primary form of records storage we provide), as well as secure off-site storage of data backup media. Our related information management services can be broadly divided into three major service categories: records management services, data protection & recovery services, and information destruction services. We offer both physical services and technology solutions in each of these categories. Media formats can be broadly divided into physical and electronic records. We define physical records to include paper documents, as well as all other non-electronic media such as microfilm and microfiche, master audio and videotapes, film, X-rays and blueprints. Electronic records include emaile-mail and various forms of magnetic media such as computer tapes, and hard drives and optical disks.

        Our physical records management services include: flexible retrieval access, retention management and records management program development and implementation based on best-practicesbest practices to help customers comply with specific regulatory requirements implementation ofand policy-based programs that feature secure, cost-effective storage for all major media, including paper (which is the dominant form of records storage), flexible retrieval access and retention management. Includedprograms. Also included within physical records management services isare our Document Management Solutions ("DMS"). This suite of servicesDMS helps organizations to gain better access to, and ultimately control over, their paper records by digitizing, indexing and hosting them in online archives to provide complete information life-cyclelifecycle solutions. Our technology-based records management services are comprised primarily of digital archiving and related services for secure, legally compliant and cost-effective long-term archiving of electronic records and eDiscovery services. Within the records management services category, we have developed specialized services for vital records and regulated industries such as healthcare, energy, government and financial services.

        Our physical data protection & recovery services include disaster preparedness, planning, supportthe secure handling and secure, off-site vaultingtransportation of data backup media for fast and efficient data recovery in the event of a disaster, human error or virus.virus as well as disaster preparedness, planning and support. Our technology-based data protection & recovery services include online backup and recovery solutions for desktop and laptop computers and remote servers. Since our sale of the Digital Business, we offer these technology-based services primarily through partnerships. Additionally, we serve as a trusted, neutral third party and offer intellectual propertytechnology escrow services to protect and manage source code and other proprietary information.

        Our information destruction services are comprised almost exclusively consist of secure shredding services. Secure shredding services complete the life cyclelifecycle of a record and involve the shredding of sensitive documents in a way that ensures privacy and a secure chain of custody for the records. These services typically include either the scheduled pick-up of loose office records, which customers accumulate in specially designed secure containers that we provide, or the shredding of documents stored in our records facilities upon the expiration of their scheduled retention periods.

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Physical Records

        Physical records may be broadly divided into two categories: active and inactive. Active records relate to ongoing and recently completed activities or contain information that is frequently referenced. Active records are usually stored and managed on-site by the organization that originated themtheir owners to

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ensure ready availability. Inactive physical records are the principal focus of the storage and information management services industry. Inactive recordsindustry and consist of those records that are not needed for immediate access but which must be retained for legal, regulatory and compliance reasons or for occasional reference in support of ongoing business operations. A large and growing specialty subset of the physical records market is medical records. These are active and semi-active records that are often stored off-site with, and serviced by, ana storage and information management services vendor. Special regulatory requirements often apply to medical records. In addition to our core records management services, we provide consulting, facilities management, fulfillment and other outsourcing services.services relating to storage and information management.

Electronic Records

        Electronic records management focuses on the storage of, and related services for, computer media that is either a backup copy of recently processed data or archival in nature. We believe the issues encountered by customers trying to manage their electronic records are similar to the ones they face in their physical records management programs and consist primarily of: (1) storage capacity and the preservation of data; (2) access to and control over the data in a secure environment; and (3) the need to retain electronic records due to regulatory requirements or for litigation support. Customer needs for data backup and recovery and archiving are distinctively different. Backup data exists because of the need of many businesses to maintain backup copies of their data in order to be able to recover the data in the event of a system failure, casualty loss or other disaster. It is customary (and a best practice) for data processing groups to rotate backup tapes to off-site locations on a regular basis and to require multiple copies of such information at multiple sites.

In addition to the physical rotationstorage and storagerotation of backup data that our physical business segmentswe provide, our Worldwide Digital Business segment offerswe offer online backup services through partnerships as an alternative way for businesses to transfer data to us,store and to access the data they have stored with us.data. Online backup is a Web-based service that automatically backs up computer data from servers or directly from desktop and laptop computers over the Internet and stores it in one of our secure data centers. In early 2003, we announced an expansion of the online backup service to include backup and recovery for personal computer data, answering customers' needs to protect critical business data, which is often unprotected on employee laptop and desktop personal computers. In November 2004, we acquired Connected Corporation ("Connected"), a market leader in the backup and recovery of this distributed data, and in December 2005, we acquired LiveVault Corporation ("LiveVault"), a market leader in the backup and recovery of server data.

        There is a growing need for better ways of archiving electronic records for legal, regulatory and compliance reasons and for occasional reference in support of ongoing business operations. Historically, businesses have relied on backup tapes for storing archived data in electronic format, but this process can be costly and ineffective when attempting to search and retrieve the data for litigation or other needs. In addition, many industries, such as healthcare and financial services, are facing increased governmental regulation mandating the way in which electronic records are stored and managed. To help customers meet these growing storage challenges, we introduced digital archiving services in 2003. We have experienced increasing market adoption of these services, especially for e-mail archiving, which enables businesses to identify and retrieve electronic records quickly and cost-effectively, while maintaining regulatory compliance.

        On December 1, 2006, changes to the Federal Rules of Civil Procedure ("FRCP") were implemented; as a result, electronically stored information was explicitly defined as a separate class of discoverable information in litigation. There is no longer any ambiguity about whether digital data constitutes a "document" and businesses now have the clear responsibility to produce electronic records. In December 2007, we acquired Stratify Inc. ("Stratify"), a leading provider of eDiscovery services to assist customers with managing discovery of electronic records.

        We believe the issues encountered by customers trying to manage their electronic records are similar to the ones they face in their physical records management programs and consist primarily of: (1) storage capacity and the preservation of data; (2) access to and control over the data in a secure environment; and (3) the need to retain electronic records due to regulatory requirements or for

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litigation support. Our digital services offerings are representative of our commitment to address evolving records management needs and expand the array of services we offer.

Growth of Market

        We believe that the volume of stored physical and electronic records will continue to increase on a global basis for a number of reasons, including: (1) regulatory requirements; (2) concerns over possible future litigation and the resulting increases in volume and holding periods of records; (3) the continued proliferation of data processing technologies such as personal computers and networks; (4) inexpensive document producing technologies such as facsimile, desktop publishing software and desktop printing; (5) the high cost of reviewing records and deciding whether to retain or destroy them; (6) the failure of many entities to adopt or follow policies on records destruction; and (7) the need to keep backup copies of certain records in off-site locations for business continuity purposes in the event of disaster.

        We believe that the creation of paper-based information will continue to grow,be sustained, not in spite of, but because of, "paperless" technologies such as e-mail and the Internet. These technologies have prompted the creation of hard copies of such electronic information and have also led to increased demand for electronic records services, such as the storage and off-site rotation of backup copies of magnetic media. In addition, we believe that the proliferation of digital information technologies and distributed data networks has created a growing need for efficient, cost-effective, high quality technology solutions for electronic data protection digital archiving and the management of electronic documents.

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Consolidation ofAcquisitions in a Highly Fragmented Industry

        There was significant consolidation within the highly fragmented physicalThe storage and information management services industry in North America from 1995 to 2000has long been and atremains a slower but continuing pace in recent years. Most physical information management services companies serve a single local market, and are often either owner-operated or ancillary to another business, such as a moving and storage company. We believe that the consolidation trend in the physical information managementhighly fragmented industry bothwith thousands of competitors in North America and other international geographies, will continue because ofaround the industry's capital requirements for growth,world. Between 1995 and 2004 there was significant acquisition activity in the industry. Acquisitions were a fast and efficient way to achieve scale, expand geographically and broaden service offerings. We believe this acquisition activity, which is ongoing, is due to the opportunities for large information management services providers to achieve economies of scale and meet customer demands for more sophisticated, technology-based solutions.

        We believe that the consolidation trend Attractive acquisition opportunities, many of which are small, in this industry is also due to,North America and will continue as a result of, the preference of certain large organizations to contract with one vendor in multiple cities and countries for multiple services. In particular, larger customers increasingly demand a single, sophisticated company to handle all of their important physical records needs. Large national and multinational companies are better able to satisfy these demands than smaller competitors. We have made, and mayinternationally continue to make from timeexist, and we may pursue acquisition of these businesses where we believe they present a good opportunity to time, acquisitions ofcreate value for our competitors, many of whom are small, single-city operators.stockholders.

DescriptionCharacteristics of Our Business

        We generate our revenues by renting storage space to a large and diverse customer base in 64.5 million square feet of real estate around the globe and providing storage (both physical and electronic records in a variety of information media formats),to our customers core records management, data protection & recovery, information destruction, DMS services and an expanding menu of complementary products and services to a large and diverse customer base.services. Providing outsourced information management servicesstorage is the mainstay of our customer relationships and providesserves as the foundation for all our revenue growth. Core services, which are a vital part of a comprehensive records management program, consist primarily of the handling and transportation of stored records and information. In our secure shredding operations, core services consist primarily of the scheduled collection and shredding of records and documents generated by business operations. Additionally, core services include certain DMS services and recurring project revenues. As is the case with storage revenues,rental revenue, core service revenues are highly recurring in nature. In 2009,2012, our storage rental and core service revenues represented approximately 88%89% of our total consolidated revenues. In addition to our core services, we offer a wide array of complementary

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products and services, including special project work, data restoration projects, fulfillment services, consulting services, technology services and product sales (including software licenses, specially designed storage containers and related supplies). In addition, included inFurthermore, complementary services revenue isincludes recycled paper revenues. Theserevenue. Complementary services address more specific needs of our customers and are designed to enhance our customers' overall records management programs. These services complement our core services; however, they are more episodic and discretionary in nature. Revenue generated by all of our operating segments includes both core and complementary components.

        Our various operating segments offer the products and services discussed below. In general, our North American Physical Business and our International Physical Business segments offer physical recordsstorage and the information management services data protection & recovery services and information destruction services,discussed below, in their respective geographies. Our Worldwide Digital Business segment includes our online backup and recovery solutions for server data and personal computers, digital archiving services, eDiscovery services and intellectual property management services and is not limited to any particular geography. Some of our complementary services and products are offered within all of our segments. The amount of revenues derived from our North American Physical Business, International Physical Business and Worldwide DigitalInternational Business operating segments and other relevant data, including financial information about geographic areas and product and service lines, for fiscal years 2007, 20082010, 2011 and 20092012 are set forth in Note 9 to Notes to Consolidated Financial Statements.

Secure Storage

        We provide cost-effective secure storage for all major media, including paper (which is the primary form of records storage we provide) as well as secure off-site vaulting of data backup media. Renting secure space to customers for the purpose of storing paper records and data backup media is by far our largest source of revenue. Records storage consists primarily of the archival storage of records for long periods of time according to applicable laws, regulations and industry best practices. The secure off-site storage of data backup media is a key component of a company's disaster recovery and business continuity programs and storage rental charges are generally billed monthly on a per storage unit basis.

        Hard copy business records are typically stored for long periods of time with limited activity in cartons packed by the customer. For some customers we store individual files on an open shelf basis, and these files are typically more active. Storage rental charges are generally billed monthly on a per

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storage unit basis, usually per cubic foot of records, and include the provision of space, racking systems, computerized inventory and activity tracking and physical security.

        Vital records contain critical or irreplaceable data such as master audio and video recordings, film and other highly proprietary information, such as energy data. Vital records may require special facilities, either because of the data they contain or the media on which they are recorded. Accordingly, our charges for providing enhanced security and special climate-controlled environments for vital records are higher than for typical storage rental.

Service Offerings

        Our information management services can be broadly divided into three major categories: records management services, data protection & recovery services and information destruction services. We offer both physical services and technology solutions in the records management and data protection & recovery categories. Currently, we offer only offer physical services in the information destruction services category.

Records Management Services

        By far our largest category of services, records management services are comprised primarily of the archival storage of records, both physical and digital, for long periods of time according to applicable laws, regulations and industry best practice. CoreCentral to any records management program is the handling and transportation of thosestored records being stored and the eventual destruction of documents stored inthose records facilities upon the expiration of their scheduled retention periods. For physical records, thisThis is accomplished through our extensive service and courier operations. Other records management services include:include our DMS services as well as Compliant Records Management and Consulting Services, DMS, Health Information Storage and Management Solutions, Film & Sound Archives,Entertainment Services, Energy Data Services, Discovery Services and other ancillary services.

        Hard copy business records are typically stored for long periods of time in cartons packed by the customer with limited activity. For some customers we store individual files on an open shelf basis and these files are typically more active. Storage charges are generally billed monthly on a per storage unit basis, usually either per carton or per cubic foot of records, and include the provision of space, racking, computerized inventory and activity tracking and physical security.

        Service and courier operations are an integral part of our comprehensive records management program for all physical media. Theymedia and include adding records to storage, temporary removal oftemporarily removing records from storage, refiling of removed records, permanent withdrawalspermanently withdrawing records from storage and the destruction ofdestroying records. Service charges are generally assessed for each procedureactivity on a per unit basis. Courier operations consist primarily of the pick-up and delivery of records upon customer request. Charges for courier services are based on urgency of delivery, volume and location and are billed monthly. As of December 31, 2009, we were utilizing a2012, our fleet consisted of approximately 3,700 owned or leased vehicles.

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        Our digital archiving services focus on archiving digital information with long-term preservation requirements. These services represent the digital analogy to our physical records management services. Because of increased litigation risks and regulatory mandates, such as the changes to the FRCP that explicitly define electronically stored information as a separate class of discoverable information, companies are increasingly aware of the need to apply the same records management policies and retention schedules to electronic data as they do physical records. Typical digital records include e-mail, e-statements, images, electronic documents retained for legal or compliance purposes and other data documenting business transactions.

        The growth rate of mission-critical digital information is accelerating, driven in part by the use of the Internet as a distribution and transaction medium. The rising cost and increasing importance of storing and managing digital information, management, coupled with the increasing availability of telecommunications bandwidth at lower costs, may create meaningful opportunities for us to provide solutions to our customers with respect to their digital records storage and management challenges. We continue to cultivate marketing and technology partnerships to support this anticipated growth.

        The focus of our DMS business is to develop, implement and support comprehensive documentstorage and information management solutions for the complete lifecycle of our customers' information. We seek to develop solutions that solve our customers' document management challenges by integrating the management of physical records, document conversion and digital storage. Our DMS complementsservices complement our core physical and digital service offerings leveraging our global footprint and enhance our existing customer relationships. We differentiate our offerings from our competitors by providing solutions that integrate and extendexpand our existing portfolio of products and services.

The trend towards increased usage of Electronic Document Management ("EDM") systems represents another opportunity for us. In addition to our existing archival storage services, there is increased opportunityus to manage active records. Our DMS services provide the bridge between customers' physical documents and their new EDM solutions.

        We offer records management services that have been tailored for specific industries, such as health care, or to address the needs of customers with more specific needsrequirements based on the critical nature of their records. HealthcareFor example, medical records tend to be more active in nature and are typically

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stored on specialized open shelving systems that provide easier access to individual files. In addition to storing medical records, we provide health care information services, principallywhich include the handling, storage, filing, processing and retrieval of medical records used by hospitals, private practitioners and other medical institutions. Medical records tend to be more active in nature and are typically stored on specialized open shelving systems that provide easier access to individual files. Healthcare information services also includeinstitutions, as well as recurring project work and ancillary services. Recurring project work involves the on-site removal of aged patient files and related computerized file indexing. Ancillary healthcare information services include release of information (medical record copying and delivery), temporary staffing, contract coding, facilities management and imaging.

        Vital records contain critical or irreplaceable data such as master audio and video recordings, film and other highly proprietary information, such as energy data. Vital records may require special facilities or services, either because of the data they contain or the media on which they are recorded. Our charges for providing enhanced security and special climate-controlled environments for vital records are higher than for typical storage services. We provide the same ancillary services for vital records as we provide for our other storage operations.

        Our Discovery Services comprise solutions designed to address the legal discovery and corporate governance needs of our customers. Those services and solutions allow our customers to collect, prepare, process, review, and produce data that may exist in either paper or digital form in response to internal investigations, litigation or regulatory requests.

        Electronic discovery is the component of legal discovery involving information that is converted into digital data or collected and processed in that form. Our eDiscovery services, principally embodied by the Stratify® Legal Discovery application, help our customers identify, organize, analyze, and review

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particularly relevant or responsive information from within the universe of electronic data generated during the normal course of their business. The ability of current content management technologies to capture and maintain several copies of documents—including different versions of working drafts—underscores the challenges companies face in managing information for eDiscovery.

        Our consolidated suite of physical and digital discovery services has been designed to deliver a secure, end-to-end chain-of-custody, while also reducing both risks and costs for our customers.

        We offer a variety of additional services which customers may request or contract for on an individual basis. These services include conducting records inventories, packing records into cartons or other containers, and creating computerized indices of files and individual documents. We also provide services for the management of active records programs. We can provide these services, which generally include document and file processing and storage, both off-site at our own facilities and by supplying our own personnel to perform management functions on-site at the customer's premises. We also sell a full line of specially designed corrugated cardboard storage cartons.

        Other complementary lines of business that we operate include fulfillment services and professional consulting services. Fulfillment services are performed by our wholly-ownedwholly owned subsidiary, Iron Mountain Fulfillment Services, Inc. ("IMFS"). IMFS stores customer marketing literature and other materials for its customers and delivers this material to sales offices, trade shows and prospective customers' locations based on current and prospective customer orders.needs. In addition, IMFS assembles custom marketing packages and orders and manages and provides detailed reporting on customer marketing literature inventories. A growing element of the content we manage and fulfill is stored digitally and printed on demand by IMFS. Digital print allows marketing materials such as brochures, direct mail, flyers, pamphlets and newsletters to be personalized to the recipient with the variable messages, graphics and content.

        We provide professional consulting services to customers, enabling them to develop and implement comprehensive recordsstorage and information management programs. Our consulting business draws on our experience in storage solutions and information management services to analyze the practices of companies and assist them in creating more effective programs ofto store records and information management.manage information. Our consultants work with these customers to develop policies and schedules for document retention and destruction.

        We also sell a fullsold our domain name management product line of specially designed corrugated cardboard storage cartons. In 2008in 2010 and the Digital Business, including our former wholly owned subsidiaries, Mimosa Systems, Inc. and Stratify, Inc., and our New Zealand operations in 2011. Also, we divested ourselves ofsold our commodity data products sales business.Italian operations in April 2012. Consistent with our treatment of acquisitions, we eliminated all revenues associated with our data products businessthese businesses, which have all been reflected as discontinued operations for financial reporting purposes, from the calculation of our internal growth in 2008rates for 2010, 2011 and 2009.2012.

Data Protection & Recovery Services

        Our data protection & recovery services are designed to comply with applicable laws and regulations and to satisfy industry best practices with regard to the off-site vaulting of data for disaster recovery and business continuity purposes. As is the case with our records management services, weWe provide data protection & recovery services for both physical and electronic records. We also offer intellectual property managementtechnology escrow services in this category.

        Physical data protection & recovery services consist of the storage and rotation of backup computer media as part of corporate disaster recovery and business continuity plans. Computer tapes, cartridges and disk packs are transported off-site by our courier operations on a scheduled basis to secure, climate-controlled facilities, where they are available to customers 24 hours a day, 365 days a year, to facilitate data recovery in the event of a disaster. Frequently, back-upbackup tapes are then rotated from our facilities back to

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our customers' data centers. We also manage tape library relocations and support disaster recovery testing and execution.

        Online backup is oura Web-based service that automatically backs up computer data from servers or directly from desktop or laptop computers over the Internet and stores it in one of our secure data centers. Customers use our Connected® backup for PC software product for online backupAfter the sale of desktop or laptop computer datathe Digital Business, we continue to offer this service pursuant to a reseller agreement with Autonomy Corporation plc, a corporation formed under the laws of England and our LiveVault® server data backup and recovery product for online

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backup of server data. Customers can choose our off-site hosted Software as a Service solution or they can license the software from us as part of a customer on-site solution.Wales ("Autonomy").

        Through our intellectual property managementtechnology escrow services business, we act as a trusted, neutral, third party, safeguarding valuable technology assets—such as software source code, object code and data—in secure, access-protected escrow accounts. Acting in this intermediary role, we help document and maintain intellectual property integrity. The result is increased control and leverage for all parties, enabling them to protect themselves, while maintaining competitive advantage.

Information Destruction Services

        Our information destruction services consist primarily of our physical secure shredding operations. Secure shredding is a natural extension of our hardcopyhard copy records management services, completing the life cyclelifecycle of a record, and involves the shredding of sensitive documents for corporate customers that, in many cases, also use our services for management of less sensitive archival records. These services typically include the scheduled pick-up of loose office records whichthat customers accumulate in specially designed secure containers we provide. Complementary to our shredding operations is the sale of the resultant waste paper to third-party recyclers. Through a combination of plant-based shredding operations and mobile shredding units comprisedconsisting of custom built trucks, we are able to offer secure shredding services to our customers throughout the U.S., Canada, the U.K.United Kingdom, Ireland, Australia and Australia/New Zealand.Latin America.

Financial Characteristics of Our Business

        Our financial model is based on the recurring nature of our various revenue streams. The historical predictability of our revenues and the resulting adjusted operating income before depreciation and amortization ("Adjusted OIBDA")OIBDA allow us to operate with a high degree of financial leverage. For a more detailed definition and reconciliation of Adjusted OIBDA and a discussion of why we believe this measure provides relevant and useful information to our current and potential investors, see Item 7. "Management's Discussion and Analysis of Financial Condition and Results of Operations—Non-GAAP Measures." Our business has the following financial characteristics:

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Recurring Revenues.  We derive a majority of our consolidated revenues from fixed periodic, usually monthly, storage rental fees charged to customers based on the volume of their records stored. Once a customer places physical records in storage with us, and until those records are destroyed or permanently removed (for which we typically receive a service fee), we receive recurring payments for storage feesrental without incurring additional labor or marketing expenses or significant capital costs. Similarly, contracts for the storage of electronic backup media consistinvolve primarily of fixed monthly rental payments. Our annual revenues from these fixed periodic storage rental fees have grown for 2124 consecutive years. For each of the fivethree years 20052010 through 2009,2012, storage rental revenues, which are stable and recurring, have accounted for over 54%55% or more of our total consolidated revenues. This stable and growing storage rental revenue base also provides the foundation for increases in service revenues and Adjusted OIBDA.



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Historically Non-Cyclical Storage Rental Business.  Historically, we have not experienced any significant reductions in our storage rental business as a result of economic downturns although, during recent economic slowdowns, the rate at which some customers added new cartons to their inventory was below historical levels. We believe that companies that have outsourced records management services are less likely during economic downturns to incur the move-out costs and other expenses associated with accelerating destructions of their records, switching vendors or moving their records management services programs in-house. However, during this current recession,the recent economic downturn, which was more severe and lasted longer than other recent downturns, destruction rates have increased as some customers have been more willing to incur additional short-term service costs in exchange for lower storage rental costs in the long-term. This phenomenon resultsIn addition, we have experienced longer sales cycles and lower incoming volumes from existing customers, due in large part, we believe, to high unemployment rates and generally lower levels of business activity. Combined, these impacts have resulted in lower net volume growth rates in the short-term.rates. The net effect of these factors has been the continued growth of our storage rental revenue base, albeit at a lower rate. For each of the three years 2010 through 2012, total net volume growth has been approximately 2% on a global basis.

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each of the five years 2005 through 2009, total net volume growth in North America has ranged between 1% and 8%.

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Inherent Growth from Existing Physical Records Customers.  Our physical records customers have, on average, generatedsent us additional cartons at a faster rate than stored cartons have been destroyed or permanently removed. However, during the recent economic downturn, the combination of lower incoming volumes from existing customers, due in large part, we believe, to high unemployment rates and generally lower business activity, and increased destruction rates, as described above, resulted in lower consolidated net volume growth in recent quarters, including negative net volume growth from existing customers at times in certain markets. Since reaching unusually high levels in 2009, our destruction rates have stabilized at rates closer to historical norms. After the economy has improved, we expect our growth from existing customers should improve although we cannot give any assurance as to how much, if any, improvement we will realize. We believe the consistentcontinued growth of our physical records storage rental revenues is the result of a number of factors, including: (1)including the trend toward increased records retention; (2)retention, albeit at a lower rate of growth, customer satisfaction with our services; (3) the costsservices and inconvenience of moving storage operations in-house or to another provider of information management services; and (4) our positive pricing actions.net price increases.



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Diversified and Stable Customer Base.  As of December 31, 2009,2012, we had over 140,000 corporate155,000 clients in a variety of industries.industries in 35 countries around the world. We currently provide storage and information management services to commercial, legal, banking, healthcare, accounting, insurance, entertainment and government organizations, including more than 97%94% of the Fortune 1000 and 93% of the FTSE 100.1000. No single customer accounted for as much as 2% of our consolidated revenues in any of the years ended December 31, 2007, 20082010, 2011 and 2009.2012. For each of the three years 20072010 through 2009,2012, the average annual volume reduction due to customers terminating their relationship with us was less than 2%3%.



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Capital Expenditures Related Primarily to Growth.Business Line Growth and Ongoing Operations.  Our business requires significant capital expenditures to support our expected storage rental revenue and service revenue growth and ongoing operations, new products and services and increased profitability. As the nature of our business has evolved over time, so has the nature of our capital expenditures. Every year we expend capital to support a number of different objectives. The majority of our capital goes to support business line growth and our ongoing operations. Additionally, we invest capital to acquire or construct real estate. We also expend capital to support the development and improvement of products and services and projects designed to increase our profitability. These expenditures are generally relatively small and discretionary in nature. Below are descriptions of the major types of capital expenditures we are likely to make in a given year:



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Capital to support business line growth—these expenditures are primarily related to capacity expansion such as wellinvestments in new building outfitting, carton storage systems, tape storage systems and containers, shredding plants and bins and technology service storage and processing capacity.



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Capital to acquire/construct real estate—these expenditures are directly related to the acquisition of real estate, either through the purchase or construction of a new facility or the buyout of an existing lease.



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Capital to support ongoing business operations—these expenditures are primarily related to major repairs and/or the replacement of assets, such as facilities, warehouse equipment and computers. This category also includes operational support initiatives such as sales and marketing and information technology projects to support infrastructure requirements.



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Capital for new product development—these expenditures are directly related to the development of new products or services in support of our current operations.integrated value proposition.



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Capital for product improvement—these expenditures are primarily related to product and service enhancements that support our leadership position in the industry. Spending in this area includes items such as increased feature functionality, security upgrades or system enhancements.

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Capital to support operational efficiencies—these expenditures are primarily related to driving increased profitability through cost savings and operating efficiencies and include items such as facility consolidations and systems to support operating process improvements.

        Following is a table presenting our capital expenditures for 2010, 2011 and 2012 organized by the nature of the spending as described above:

        We believe that capital expenditures, net of real estate and capital expenditures that are part of our REIT Costs, incurred as a percent of revenues is a meaningful metric for investors asbecause it indicates the efficiency with which we are investing in the internal growth and operational efficiency of our business. For the years 20072010 through 2009,2012, our total capital expenditures, net of real estate and capital expenditures that are part of our REIT Costs, incurred as a percent of revenues were approximately 8%, 7% and 6%, respectively. This decrease since 2010 is due primarily to our disciplined approach to capital management, a shift toward less capital intensive service revenues and moderating growth rates in our physical storage rental business.

        Following is a table presenting our capital expenditures as a percent of total revenues were 14%, 13%for 2010, 2011 and 10%, respectively. Included2012 organized by the nature of the spending as described above:

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Growth Strategy

        Our objective isWe offer our customers an integrated value proposition by providing them with secure storage and comprehensive information management services, including records management services, data protection & recovery services and information destruction services. We have the expertise and experience to address complex storage and information management challenges such as rising storage rental costs and increased litigation, regulatory compliance and disaster recovery requirements. We expect to maintain a leadership position in the storage and information management services industry around the world protectingby enabling customers to store, protect and storing our customers' information and enabling them to better use it without regard to mediatheir information—regardless of its format, location or geographic location. In the U.S.lifecycle stage—so they can optimize their business and Canada, we seek to be one of the largest information management services providers in each of our markets. Internationally, ourensure proper recovery, compliance and discovery.

        Our objectives are to continue to capitalize on our expertise in the storage and information management services industry and to make additional fold-in acquisitions in more developed markets and acquisitions and investments to establish an industry-leading presence in selected internationalemerging markets. We intend thatOur near-term growth objectives include a set of specific initiatives: (1) increasing our primary avenues of growth will continueincoming storage volumes with a targeted, low risk approach to be: (1) the introduction of new productsimproving our sales effectiveness, thereby increasing revenues from our existing customers and services such as secure shredding, online backup, eDiscovery and DMS; (2) increased business with existing customers; (3) the addition ofgaining new customers; (2) driving higher volume growth in our international businesses as we expand our platform for selling storage, core services and (4) selectivenew services in higher growth markets; and (3) continuing to add new rental streams and ancillary services to our portfolio to support our long-term growth objectives and drive solid returns on invested capital. Our overall growth strategy will focus on growing our business organically, making strategic customer acquisitions in new and existing markets.

Tablepursuing acquisitions of Contentsstorage and information management businesses.

Introduction of New Products and Services

        We continue to expand our portfolio of products and services. Adding new products and services allows us to further penetratestrengthen our existing customer accountsrelationships and attract new customers in previously untapped markets.

        In 2009, we introduced two new technology solutions: Virtual File Store™ ("VFS"), an enterprise-class, cloud-based digital storage archiving service and eVantage™, an on-premises eDiscovery early case assessment solution. VFS is an on-demand, long-term storage service that reduces total cost of ownership for storing and managing static data files. As companies search for cost-effective solutions to manage large amounts of digital information, our VFS solution offers secure, long-term storage of inactive data at off-site data centers, greatly reducing the investment in an expensive on-site storage infrastructure and supporting regulatory and compliance initiatives. Stratify's eVantage solution safeguards corporate proprietary information and allows general counsel to reduce the cost and risk of eDiscovery by going beyond statistical data culling with advanced technologies that drive more intelligent qualitative analysis on all matters and internal investigations in their eDiscovery portfolio.

Growth from Existing Customers

        Our existing customers storingcustomers' storage of physical records contributecontributes to the growth of storage rental and storage-related servicecertain records management services revenues growth because, on average, theyour existing customers generate additional cartons at a faster rate than old cartons are destroyed or permanently removed. However, during the recent economic downturn, the combination of lower incoming volumes from existing customers, due in large part, we believe, to high unemployment rates and generally lower business activity, and increased destruction rates, resulted in lower consolidated net volume growth in recent quarters, including negative net volume growth from existing customers at times in certain markets. Since reaching unusually high levels in 2009, our destruction rates have stabilized at rates closer to historical norms. After the economy has improved, we expect our growth from existing customers should improve although we cannot give any assurance as to how much, if any, improvement we will realize. In order to maximize growth opportunities from existing customers, we seek to maintain high levels of customer retention by providing premium customer service through our local account management staff.

        Our sales coverage model is designed to identify and capitalize on incremental revenue opportunities by strategically allocating our sales resources based on a sophisticated segmentation ofto our customer base and selling additional recordsstorage, information management data protection & recoveryservices and information destruction services,products in new and existing markets within our existing customer relationships. We also seek to leverage existing business relationships with our customers by selling complementaryThese services and products. Servicesproducts include special project work, data restoration projects, fulfillment services, consulting services, technology services and product sales (including software licenses, specially designed storage containers and related supplies). In addition, included in complementary services revenue is recycled paper revenues.

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Addition ofExpanding New Customersand Existing Customer Relationships

        Our sales forces are dedicated to three primary objectives: (1) establishing new customer account relationships; (2) generating additional revenue fromby expanding existing customers in new and existing markets;customer relationships globally; and (3) expanding new and existing customer relationships by effectively selling a wide array of complementary services and products. In order to accomplish these objectives, our sales forces draw on our U.S. and international marketing organizations and senior management.

Growth through Acquisitions

        The goalsgoal of our current acquisition program are (1)is to supplement internal growth in our physical businesses by expanding our new service capabilities and industry-specific services and continuing to expand our presence in targeted emerging markets, continuing to make fold-in acquisitions in North America and more developed international markets;markets and (2) to accelerateexpanding our leadershiprental streams, new service capabilities and time to market in our digital businesses.industry-specific services. We have a successful record of acquiring and integrating storage and information management services companies. We substantially completed our geographic expansion in North America, Europe and Latin America by 2003 and began our expansion into Asia Pacific in 2005.

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Acquisitions in the North American PhysicalBusiness Segment

        We have acquired, and we continue to seek to acquire, storage and information management services businesses in the U.S. and Canada. Given the relatively small numbersize of attractivemost acquisition targets in our core physical businesses in North America, andwhere we believe they present a good opportunity to create value for our increased revenue base,stockholders, future acquisitions are expected to be less significant to our overall North American Business segment revenue growth than in the past. Acquisitions in the North American Physical segment will likely focus primarily on expanding our DMS capabilities and enhancing industry-specific services such as health information management solutions.

Acquisitions in the International PhysicalBusiness Segment

        We expect to continue to make acquisitions and investments in storage and information management services businesses in targeted markets outside North America.America, particularly emerging markets. We have acquired and invested in, and seek to acquire and invest in, storage and information management services companies in certain countries, and, more specifically, certain markets within such countries, where we believe there is potential for significant growth. Future acquisitions and investments will focus primarily on developingexpanding priority expansion markets in Continental Europe, Latin America and Asia Pacific, with continued leverage of our successful joint venture model. Similar to our strategy in North America, we will also explore international acquisitions that strengthen our capabilities in areas such as DMS and industry-specific services.

        The experience, depth and strength of local management are particularly important in our international expansion and acquisition strategy. Since beginning our international expansion program in January 1999, we have, directly and through joint ventures, expanded our operations into 36more than 30 countries in Europe, Latin America and Asia Pacific. These transactions have taken, and may continue to take, the form of acquisitions of an entire business or controlling or minority investments with a long-term goal of full ownership. We believe oura joint venture strategy, rather than an outright acquisition, may, in certain markets, better position us to expand the existing business. The local partner benefitspartners benefit from our expertise in the storage and information management services industry, our multinational customer relationships, our access to capital and our technology, andwhile we benefit from our local partners' knowledge of the market, relationships with local customers and their presence in the community. In addition to the criteria we use to evaluate North American acquisition candidates, when looking at an international investment or acquisition, we also evaluate the presence in the potential market of our existing customers as well as the risks uniquely associated with an international investment, including those risks described below.

        Our long-term goal is to acquire full ownership of each business in which we mademake a joint venture investment. InSince 2008, we have acquired the remaining minority equity ownership in our BrazilianGreece (2010), China (2010), Hong Kong (2010) and Singapore (2010) operations and increased our equity ownership interest in our Switzerland (2012) and Turkey (2012) operations. In 2010, to better align our operations with our long-term international growth objectives, we sold our equity ownership interest in Indonesia and Sri Lanka. We now own more than 98%97% of our international operations, measured as a percentage of consolidated revenues. In connection with the strategic review of certain of our

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international businesses, we sold our New Zealand operations in October 2011 and our Italian operations in April 2012.

        Our international investments are subject to risks and uncertainties relating to the indigenous political, social, regulatory, tax and economic structures of other countries, as well as fluctuations in currency valuation, exchange controls, expropriation and governmental policies limiting returns to foreign investors.

        The amount of our revenues derived from international operations and other relevant financial data for fiscal years 2007, 20082010, 2011 and 20092012 are set forth in Note 9 to Notes to Consolidated Financial Statements. For the years ended December 31, 2007, 20082010, 2011 and 2009,2012, we derived approximately 32%, 32%34% and 30%35%, respectively, of our total revenues from outside of the U.S. As of December 31, 2007, 20082010, 2011 and 2009,2012, we havehad long-lived assets of approximately 34%36%, 31%36% and 34%37%, respectively, outside of the U.S.

AcquisitionsCompetition

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uninsured losses or damage to our storage facilities due to an inability to obtain full coverage on a cost-effective basis for some casualties, such as earthquakes, or any coverage for certain losses, such as losses from riots or terrorist activities;



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inability to use our real estate holdings effectively and costs associated with vacating or consolidating facilities if the demand for physical storage were to diminish because of customers' acceptance ofour customers choose other storage technologies;technologies or because competitors attract our customers; and



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liability under environmental laws for the costs of investigation and cleanup of contaminated real estate owned or leased by us, whether or not (i) we know of, or were responsible for, the contamination, or (ii) the contamination occurred while we owned or leased the property.

        Some of our current and formerly owned or leased properties were previously used by entities other than us for industrial or other purposes that involved the use, storage, generation and/or disposal of hazardous substances and wastes, including petroleum products. In some instances these properties includedthis prior use involved the operation of underground storage tanks or the presence of asbestos-containing materials. Although we have from time to time conducted limited environmental investigations and remedial

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activities at some of our former and current facilities, we have not undertaken an in-depth environmental review of all of our properties. We therefore may be potentially liable for environmental costs like those discussed above and may be unable to sell, rent, mortgage or use contaminated real estate owned or leased by us. Environmental conditions for which we might be liable may also exist at properties that we may acquire in the future. In addition, future regulatory action and environmental laws may impose costs for environmental compliance that do not exist today.

International operations may pose unique risks.

        As of December 31, 2009,2012, we provided services in 37more than 30 countries outside the U.S. As part of our growth strategy, we expect to continue to acquire or invest in storage and information management services businesses in select foreign markets. International operations are subject to numerous risks, including:

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the impact of foreign government regulations;regulations and U.S. regulations that apply to us wherever we operate;



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the volatility of certain foreign economies in which we operate;



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political uncertainties;



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unforeseen liabilities, particularly within acquired businesses;



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the risk that the business partners upon whom we depend for technical assistance or management and acquisition expertise outside of the U.S. will not perform as expected;



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differences in business practices; and



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foreign currency fluctuations.

        In particular, our net income can be significantly affected by fluctuations in currencies associated with certain intercompany balances of our foreign subsidiaries owed to us and between our foreign subsidiaries.

Changing fire and safety standards may result in significant expense in certain jurisdictions.

        As of December 31, 2012, we operated 938 records management and off-site data protection facilities worldwide, including 569 in the United States alone. Many of these facilities were built and outfitted by third parties and added to Iron Mountain's real estate portfolio as part of acquisitions. Some of these facilities contain fire suppression and safety features that are different from our current

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specifications and current standards for new facilities, although we believe all of our facilities were constructed in compliance with laws and regulations in effect at the time of their construction or outfitting. Where we believe the fire suppression and safety features of a facility require improvement, we will develop and implement a plan to remediate the issue. In some instances local authorities having jurisdiction may take the position that our fire suppression and safety features in a particular facility are insufficient and require additional measures which may involve considerable expense to Iron Mountain. If additional fire safety and suppression measures beyond our current operating plan were required at a large number of our facilities, the expense required for compliance could negatively impact our business, financial condition or results of operations.

Unexpected events could disrupt our operations and adversely affect our results of operations.

        Unexpected events, including fires or explosions at our facilities, natural disasters such as hurricanes and earthquakes, war or terrorist activities, unplanned power outages, supply disruptions and failure of equipment or systems, could adversely affect our results of operations. These events could result in customer service disruption, physical damage to one or more key operating facilities, the temporary closure of one or more key operating facilities or the temporary disruption of information systems, each of which could negatively impact our results of operations.

Fluctuations in commodity prices may affect our operating revenues and results of operations.

        Our operating revenues and results of operations are impacted by significant changes in commodity prices. In particular, our secure shredding operations generate revenue from the sale of shredded paper to recyclers. We generate additional revenue through a customer surcharge when the price of diesel fuel rises above certain predetermined rates. As a result, significant declines in paper and diesel fuel prices may negatively impact our revenues and results of operations, and increases in other commodity prices, including steel, may negatively impact our results of operations.

Attacks on our internal information technology systems could damage our reputation, harm our businesses and adversely impact our results of operations.

        Our reputation for providing secure information storage to customers is critical to the success of our business. We have previously faced attempts by unauthorized users to gain access to our information technology systems and expect to continue to face such attempts. Although we seek to prevent, detect and investigate these security incidents and have taken steps to prevent such security breaches, there can be no assurance that attacks by unauthorized users will not be attempted in the future or that our security measures will be effective. A successful breach of the security of our information technology systems could lead to theft or misuse of our customers' proprietary or confidential information and result in third party claims against us and reputational harm. If our reputation is damaged, we may become less competitive, which could negatively impact our businesses, financial condition or results of operations.

We may be subject to claims that our technology particularly with respect to digital services, violates the intellectual property rights of a third party.

        Third parties may have legal rights (including ownership of patents, trade secrets, trademarks and copyrights) to ideas, materials, processes, names or original works that are the same or similar to those we use, especially in our digital business.use. Third parties may bring claims, or threaten to bring claims, against us that allege that their intellectual property rights are being infringed or violated by our use of intellectual property. Litigation or threatened litigation could be costly and distract our senior management from operating our business. Further, if we cannot establish our right or obtain the right to use the intellectual property on reasonable terms, we may be required to develop alternative intellectual property at our expense to mitigate potential harm.

Fluctuations in commodity prices may affect our operating revenues and results of operations.

        Our operating revenues and results of operations are impacted by significant changes in commodity prices. Our secure shredding operations generate revenue from the sale of shredded paper to recyclers. We generate additional revenue when the price of diesel fuel rises above certain predetermined rates through a customer surcharge. As a result, significant declines in paper and diesel fuel prices may negatively impact our revenues and results of operations while increases in other commodity prices, including steel, may negatively impact our results of operations.

Unexpected events could disrupt our operations and adversely affect our results of operations.

        Unexpected events, including fires or explosions at our facilities, natural disasters such as hurricanes and tornados, war or terrorist activities, unplanned power outages, supply disruptions and failure of equipment or systems, could adversely affect our results of operations. These events could

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result in customer disruption, physical damages to one or more key operating facilities, the temporary closure of one or more key operating facilities or the temporary disruption of information systems.

Risks RelatingRelated to Our Common Stock

No Guaranty of Dividend Payments or Stock RepurchasesThere is no assurance that we will continue to pay dividends.

        Although ourOur board of directors recently approved a share repurchase program and adopted a dividend policy under which we intend to pay quarterly cash dividends on our common stock,stock. However, our ability to pay dividends will be adversely affected if any determinationsof the risks described herein occur. In addition, any determination by us to repurchase our common stock or pay cash dividends on our common stock in the future will be based primarily upon our financial condition, results of operations, business requirements the price of our common stock in the case of the repurchase programand strategy and our board of director'sdirectors' continuing determination that the repurchase program and the declaration of dividends under the dividend policy areis in the best interests of our shareholders and are in compliance with all laws and agreements applicable to the repurchase and dividend programs.stockholders. The terms of our revolving credit agreementfacility and term loan facility and our indentures contain provisions permitting the payment of cash dividends and stock repurchases subject to certain limitations. For these reasons, among others, our cash dividend rate may decline or we may cease paying dividends.

Risks RelatingRelated to Our Indebtedness

Our substantial indebtedness could adversely affect our financial health and prevent us from fulfilling our obligations under our various debt instruments.

        We have a significant amount of indebtedness. The following table shows important credit statistics as of December 31, 20092012 (dollars in millions):

        Our substantial indebtedness could have important consequences to you.our current and potential investors. Our indebtedness may increase as we continue to borrow under existing and future credit arrangements in order to finance future acquisitions, to fund the Conversion Plan and for general corporate purposes, which would increase the associated risks. These risks include:

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inability to satisfy our obligations with respect to our various debt instruments;



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inability to adjust to adverse economic conditions;



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inability to fund future working capital, capital expenditures, acquisitions and other general corporate requirements, including possible required repurchases of our various indebtedness;indebtedness or the payment of quarterly dividends;



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limits on our flexibility in planning for, or reacting to, changes in our business and the information management services industry;



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limits on future borrowings under our existing or future credit arrangements, which could affect our ability to pay our indebtedness or to fund our other liquidity needs;



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inability to generate sufficient funds to cover required interest payments; and



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restrictions on our ability to refinance our indebtedness on commercially reasonable terms.

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Restrictive loan covenants may limit our ability to pursue our growth strategy.

        Our credit facility and our indentures contain covenants restricting or limiting our ability to, among other things:

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incur additional indebtedness;



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pay dividends or make other restricted payments;



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make asset dispositions;