Exhibit 10.3
AMENDED AND RESTATED EMPLOYMENT AGREEMENT
This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this "Agreement") is dated as of
April 1, 2020, by and between National Storage Affiliates Trust, a Maryland real
estate investment trust (the "Company"), and Arlen D. Nordhagen, residing at the
address set forth in the Company’s records (the "Executive").
WHEREAS, the Executive previously entered into an employment agreement with the
Company dated April 28, 2015, as amended (the "Prior Agreement");
WHEREAS, the Company wishes to offer the Executive a promotion in employment to
Executive Chairman and the Executive wishes to accept such offer; and
WHEREAS, the Company and the Executive wish to amend and restate the Prior
Agreement on the terms set forth below, to be effective as of January 1, 2020
(the "Effective Date"), at which time the terms of the Prior Agreement between
the Company and the Executive automatically terminated and this Agreement came
into effect.
NOW THEREFORE, in consideration of the mutual covenants contained herein and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:
1.Term. The Company hereby employs the Executive, and the Executive hereby
accepts such employment, for an initial term commencing as of the Effective Date
and continuing for a one-year period (the "Initial Term"), unless sooner
terminated in accordance with the provisions of Section 4 or Section 5; with
such employment to automatically continue following the Initial Term for
additional successive one-year periods (each, a “Subsequent Term”) in accordance
with the terms of this Agreement (subject to termination as aforesaid) unless
either party notifies the other party in writing of its intention not to
continue such employment at least ninety (90) days prior to the expiration of
the Initial Term or any Subsequent Term, as applicable (the Initial Term,
together with all Subsequent Terms hereunder, shall hereinafter be referred to
as the "Term").
2.Duties. During the Term, the Executive shall be employed by the Company as
Executive Chairman and, as such, the Executive shall have such responsibilities
and authority as are customary for an Executive Chairman of a company of similar
size and nature as the Company and shall faithfully perform for the Company the
duties of each such office and shall report directly to the board of directors
of the Company (the "Board"). The Executive shall devote substantially all of
his business time and effort to the performance of his duties hereunder;
provided, however, that the Executive shall be permitted to continue service as
set forth in Exhibit A and, subject to the approval of the Board, that the
Executive may serve on the boards of directors or trustees of any business
corporations or charitable organizations and such service shall not be a
violation of this Agreement; provided that such other activities do not
materially interfere with the performance of the Executive's duties hereunder.
3.Compensation.
3.1 Salary. The Company shall pay the Executive during the Term a salary at the
minimum rate of $250,000 per annum, in accordance with the customary payroll
practices of the Company applicable to senior executives from time to time. The
Compensation, Nominating and Corporate Governance Committee of the Board (the
"Compensation Committee") shall review the Executive's Annual Salary in good
faith on an annual basis and may provide for increases therein as it may in its
sole discretion deem appropriate (such annual salary, as increased, the "Annual
Salary"). Once increased, the Annual Salary shall not thereafter be decreased.
3.2 Bonus. During the Term, Executive shall be eligible to participate in any
annual incentive or bonus plan or plans maintained by the Company for senior
management executives of the Company generally, in accordance with the terms,
conditions, and provisions of each such plan as the same may be adopted,
changed, amended, or terminated, from time to time in the discretion of the
Compensation Committee. Executive shall be eligible to earn a target bonus (the
"Annual Bonus") pursuant to a program as established by the
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Compensation Committee and subject to the achievement of performance goals
determined by the Compensation Committee.
3.3 Benefits – In General. The Executive shall be permitted during the Term to
participate in any group life, hospitalization or disability insurance plans,
health programs, equity incentive plans, long-term incentive programs, 401(k)
and other retirement plans, fringe benefit programs and similar benefits that
may be available (currently or in the future) to other senior executives of the
Company generally, in each case to the extent that the Executive is eligible
under the terms of such plans or programs.
3.4 Specific Benefits. Without limiting the generality of Section 3.3, the
Executive shall be entitled to paid vacation of not less than the greater of (a)
twenty-five (25) business days per year or (b) the number of paid business
vacation days provided to other senior executives of the Company (to be taken at
reasonable times in accordance with the Company's policies). Any accrued
vacation not taken during any year may be carried forward to subsequent years;
provided that the Executive may not carry forward more than twenty-five (25)
business days of unused vacation in any one year.
3.5 Expenses. The Company shall promptly pay or reimburse the Executive for all
ordinary and reasonable out-of-pocket expenses actually incurred (and, in the
case of reimbursement, paid) by the Executive during the Term in the performance
of the Executive's services under this Agreement; provided that the Executive
documents such expenses with the properly completed forms as prescribed from
time to time by the Company in accordance with the Company's policies, plans
and/or programs.
4.Termination upon Death or Disability. If the Executive dies during the Term,
the Term shall terminate as of the date of death. If there is a good faith
determination by the Board that the Executive has become physically or mentally
incapable of performing his duties under the Agreement and such disability has
disabled the Executive for a cumulative period of one hundred eighty (180) days
within any 12‑month period (a "Disability"), the Company shall have the right,
to the extent permitted by law, to terminate the employment of the Executive
upon notice in writing to the Executive. Upon Executive’s death or in the event
that Executive’s employment is terminated due to his Disability, Executive or
his estate or his beneficiaries, as the case may be, shall be entitled to: (a)
all accrued but unpaid Annual Salary or Annual Bonus through the date of
termination of Executive’s employment, (b) any unpaid or unreimbursed expenses
incurred in accordance with Section 3.5 hereof, (c) any benefits provided under
the Company’s employee benefit plans upon a termination of employment for such
reason, in accordance with the terms contained therein (the payments and
benefits referred to in clauses (a) through (c) above, collectively, the
"Accrued Obligations"), (d) an amount equal to the target Annual Bonus, prorated
to reflect the partial year of employment, which amount shall be paid at such
time annual bonuses are paid to other senior executives of the Company, but in
no event later than March 15 of the fiscal year following the fiscal year in
which such termination occurred (subject to Section 7.15 of this Agreement), (e)
for a period of 24 months after termination of employment (subject to a
reduction to the extent the Executive receives comparable benefits from a
subsequent employer) (the "Continuation Period"), such continuing medical
benefits for the Executive and/or the Executive's eligible family members under
the Company's health plans and programs applicable to senior executives of the
Company generally as the Executive would have received under this Agreement (and
at such costs to the Executive) in the absence of such termination (but not
taking into account any post‑termination increases in Annual Salary that may
otherwise have occurred without regard to such termination and that may have
affected such benefits) (the "Continuation Benefits"), (f) any unvested
outstanding equity (or equity-based) awards held by the Executive that vest on
the basis of performance ("Performance-Based Awards") shall vest based on the
terms set forth in the applicable award agreements underlying such
Performance-Based Awards, and (g) a prorated portion (based on the number of
days of employment since the immediately prior January 1st until the date of the
Executive's death or Disability, as applicable, over 365) of the unvested
outstanding equity (or equity-based) awards held by the Executive that vest on
the basis of time ("Time-Based Awards") that would have vested on the next
vesting date applicable to such Time-Based Awards shall thereupon vest and
become free of restrictions and any remaining unvested Time-Based Awards shall
be forfeited.
Following the Executive’s death or a termination of the Executive’s employment
by reason of a Disability, except as set forth in this Section 4, the Executive
shall have no further rights to any compensation or any other benefits under
this Agreement.
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5.Certain Terminations of Employment.
5.1 Termination by the Company for Cause; Termination by the Executive without
Good Reason.
(a) For purposes of this Agreement, "Cause" shall mean, the Executive's:
(i) conviction of, or plea of nolo contendere to, a felony or any crime
involving moral turpitude or fraud (but excluding traffic violations) that is
injurious to the business or reputation of the Company;
(ii) willful failure to perform his material duties hereunder (other than any
such failure resulting from Executive’s incapacity due to injury or physical or
mental illness) which failure continues for a period of thirty (30) business
days after written demand for corrective action is delivered by the Company
specifically identifying the manner in which the Company believes the Executive
has not performed his duties;
(iii) conduct constituting an act of willful misconduct or gross negligence in
connection with the performance of his duties that are injurious to the
business, including, without limitation, embezzlement or the misappropriation of
funds or property of the Company;
(iv) failure to adhere to the lawful directions of the Board which continues for
a period of thirty (30) business days after written demand for corrective action
is delivered by the Company; or
(v) intentional and material breach of (x) any covenant contained in Section 6
of this Agreement or any other material agreement between the Executive and the
Company; or (y) the other terms and provisions of this Agreement and, in each
case, failure to cure such breach within ten (10) days following written notice
from the Company specifying such breach;
provided that the Company shall not be permitted to terminate the Executive for
Cause except on written notice given to the Executive at any time within thirty
(30) days following the occurrence of any of the events described above (or, if
later, the Company's knowledge thereof). Notwithstanding anything herein to the
contrary, the Executive shall not be deemed to have been terminated for Cause
unless and until there shall have been delivered to the Executive a copy of a
resolution duly adopted by the affirmative vote of not less than a majority of
the Board at a meeting of the Board called and held for such purposes (after
reasonable notice to the Executive and an opportunity for him, together with his
counsel, to be heard before the Board), finding that in the good faith opinion
of the Board after reasonable investigation that the Executive has engaged in
acts or omissions constituting Cause. Notwithstanding the foregoing, no act or
failure to act on the part of the Executive shall be considered “willful” unless
it is done, or omitted to be done, by the Executive in bad faith or without
reasonable belief that the Executive’s action or omission was in the best
interests of the Company.
(b) The Company may terminate the Executive's employment hereunder for Cause on
at least ten (10) days’ notice, and the Executive may terminate his employment
on at least thirty (30) days' written notice. If the Company terminates the
Executive for Cause, or the Executive terminates his employment and the
termination by the Executive is not covered by Section 4 or 5.2, the Executive
shall receive the Accrued Obligations in a lump sum payment (subject to Section
7.15 of this Agreement) within thirty (30) days following Executive’s
termination of employment, and the Executive shall have no further rights to any
compensation or any other benefits under this Agreement.
5.2 Termination by the Company without Cause; Termination by the Executive for
Good Reason.
(a) For purposes of this Agreement, "Good Reason" shall mean the following,
unless consented to by the Executive:
(i) any material change in job title or material diminution in the Executive's
roles, reporting lines and responsibilities from those set forth in this
Agreement or assignment of duties inconsistent with such position;
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(ii) a material reduction in the Executive's Annual Salary or Annual Bonus
potential or failure to promptly pay such amounts when due;
(iii) if the Company relocates Executive’s office outside a 30-mile radius of
Executive's primary office;
(iv) a material breach by the Company of this Agreement or any other material
agreement between the Executive and the Company; or
(v) the Company's notice to the Executive of non‑renewal of the Initial Term or
any Subsequent Term in accordance with Section 1 of this Agreement.
Good Reason shall also include on or following a Change in Control (as defined
in the National Storage Affiliates Trust 2015 Equity Incentive Plan), any change
in job title or diminution of roles, reporting lines or responsibilities and any
reduction in the Executive's Annual Salary or Annual Bonus potential.
(b) Notwithstanding the foregoing, (i) Good Reason shall not be deemed to exist
unless written notice of termination on account thereof is given by the
Executive no later than sixty (60) days after the time at which the event or
condition purportedly giving rise to Good Reason first occurs or arises (or, if
later, the Executive’s knowledge thereof); and (ii) if there exists (without
regard to this clause (ii)) an event or condition that constitutes Good Reason
(pursuant to Section 5.2(a)(i), Section 5.2(a)(ii), Section 5.2(a)(iii) or
Section 5.2(a)(iv)), the Company shall have thirty (30) days from the date
written notice of such a termination is given by the Executive to cure such
event or condition and, if the Company does so, such event or condition shall
not constitute Good Reason hereunder.
(c) The Company may terminate the Executive's employment without Cause at any
time for any reason or no reason. The Executive may terminate the Executive's
employment with the Company at any time for any reason or no reason, and for
Good Reason under this Section 5.2. If (x) the Company terminates the
Executive's employment and the termination is not covered by Section 4 or 5.1,
or (y) the Executive terminates his employment for Good Reason, (i) the
Executive shall be entitled to receive, in a lump sum payment (subject to
Section 7.15 of this Agreement) on the thirtieth (30th) day following the
Executive's termination of employment, (A) the Accrued Obligations, (B) the
amount equal to three times the sum of (x) the Executive's Annual Salary and (y)
the amount equal to the greater of (1) the Executive's average Annual Bonus
actually received in respect of the two fiscal years (or such fewer number of
fiscal years with respect to which Executive received an Annual Bonus) prior to
the year of termination and (2) the Executive's target Annual Bonus for the
fiscal year in which such termination of employment occurs; (ii) the
Continuation Benefits for the Continuation Period; and (iii) all outstanding
equity (or equity-based) incentives and awards held by the Executive shall
thereupon vest and become free of restrictions and all stock options shall be
exercisable in accordance with their terms.
(d) No Mitigation/No Offset. Except as otherwise provided herein, the Company’s
obligation to pay the Executive the amounts provided and to make the
arrangements provided hereunder shall not be subject to set‑off, counterclaim,
or recoupment of amounts owed by the Executive to the Company or its affiliates.
The Company agrees that, if the Executive's employment is terminated during the
Term, the Executive is not required to seek other employment or to attempt in
any way to reduce any amounts payable to the Executive by the Company.
5.3 Continuation of Benefits. Notwithstanding Sections 4(e) and 5.2(c)(ii), (i)
nothing herein shall restrict the ability of the Company to amend or terminate
the health and welfare plans and programs referred to in such Sections 4(e) and
5.2(c)(ii) from time to time in its sole discretion; provided that any such
amendments or termination are made applicable generally on the same terms to all
actively employed senior executives of the Company and does not result in a
proportionately greater reduction in the rights of or benefits to the Executive
compared with any other officers of the Company, but the Company may not reduce
benefits already earned and accrued by, but not yet paid to, the Executive and
(ii) the Company shall in no event be required to provide any benefits otherwise
required by such Sections 4(e) and 5.2(c)(ii) after such time as the Executive
becomes entitled to receive benefits of the same type and at least as favorable
to the Executive from another employer or recipient of the Executive's services
(such entitlement being determined without regard to any
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individual waivers or other similar arrangements). Notwithstanding Sections 4(e)
and 5.2(c)(ii), if at any time the Company determines that its payment of
Continuation Benefits on the Executive’s behalf would result in a violation of
applicable law (including, but not limited to, the Patient Protection and
Affordable Care Act, as amended), then in lieu of paying Continuation Benefits
pursuant to Section 4(e) or 5.2(c)(ii), the Company shall pay the Executive on
the last day of each remaining month of the Continuation Period, a fully taxable
cash payment equal to the Continuation Benefits for such month, subject to
applicable withholdings and deductions.
5.4 Release. Notwithstanding any other provision of this Agreement, the Company
shall not be required to make the payments and provide the benefits provided for
under Section 4 (in the event of Disability) or Section 5.2(c) unless the
Executive executes and delivers to the Company a waiver and release
substantially in the form attached hereto as Exhibit B within twenty-one (21)
days following the date of the Executive's termination of employment and such
waiver and release becomes effective and irrevocable. If the time period to
consider and revoke the waiver and release spans two taxable years, then any
payment or benefit under Section 4 or Section 5.2(c) shall not occur until the
second taxable year.
6.Covenants of the Executive.
6.1 Covenant Against Competition; Other Covenants. The Executive acknowledges
that (i) the principal business of the Company (which expressly includes for
purposes of this Section 6 (and any related enforcement provisions hereof), its
successors and assigns) is to own, operate and acquire self‑storage properties
in the top 100 metropolitan statistical areas throughout the United States (such
businesses, and any and all other businesses in which, at the time of the
Executive's termination, the Company is actively and regularly engaged or
actively pursuing, herein being collectively referred to as the "Business");
(ii) the Company is one of the limited number of persons who have developed such
a business; (iii) the Company's Business is national in scope; (iv) the
Executive's work for NSA and the Company has given and will continue to give him
access to the confidential affairs and proprietary information of the Company;
(v) the covenants and agreements of the Executive contained in this Section 6
are essential to the business and goodwill of the Company; and (vi) the Company
would not have entered into this Agreement but for the covenants and agreements
set forth in this Section 6. Accordingly, the Executive covenants and agrees
that:
(a) By and in consideration of the salary and benefits to be provided by the
Company hereunder, including the severance arrangements set forth herein, and
further in consideration of the Executive's exposure to the proprietary
information of the Company, and without limiting or expanding the terms and
conditions set forth in any other agreement between the Company and any of its
subsidiaries and the Executive and his affiliates, the Executive covenants and
agrees that, during the period commencing on the date hereof and ending six
months following the date upon which the Executive shall cease to be an employee
of the Company and its affiliates (the "Restricted Period"), he shall not in the
Restricted Territory (as defined below), directly or indirectly, whether as an
owner, partner, shareholder, principal, agent, employee, consultant or in any
other relationship or capacity, (i) engage in the Business (other than for the
Company or its affiliates) or otherwise compete with the Company or its
affiliates in the Business or (ii) render to a person, corporation, partnership
or other entity engaged in the Business the same services that the Executive
renders to the Company; provided, however, that, notwithstanding the foregoing,
(A) the Executive may invest in securities of any entity, solely for investment
purposes and without participating in the business thereof, if (x) such
securities are listed on any national securities exchange, (y) the Executive is
not a controlling person of, or a member of a group which controls, such entity,
and (z) the Executive does not, directly or indirectly, own 5% or more of any
class of securities of such entity; and (B) the Executive shall be permitted to
continue service as set forth in Exhibit A and, subject to the approval of the
Board, that the Executive may serve on the boards of directors or trustees of
any business corporations or charitable organizations on which the Executive was
serving as of the date of the Executive's termination of employment and such
service shall not be a violation of this Agreement.
For purposes of this Agreement, the "Restricted Territory" shall mean any (i)
state in the United States and (ii) foreign country or jurisdiction, in the case
of clause (i) or (ii), in which the Company (x) is actively conducting the
Business during the Term or (y) has initiated a plan adopted by the Board to
conduct the Business in the two years following the Term.
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(b) Confidentiality.
(i) During and after the Term, the Executive shall keep secret and retain in
strictest confidence, and shall not use for his benefit or the benefit of
others, except in connection with the business and affairs of the Company and
its affiliates, all non- public confidential matters relating to the Company's
Business and the business of any of its affiliates and to the Company and any of
its affiliates, learned by the Executive heretofore or hereafter directly or
indirectly from the Company or any of its affiliates (the "Confidential Company
Information"), and shall not disclose such Confidential Company Information to
anyone outside of the Company except in the course of his duties as Executive
Chairman or with the Board's express written consent and except for Confidential
Company Information which is at the time of receipt or thereafter becomes
publicly known through no wrongful act of the Executive or is received from a
third party not under an obligation to keep such information confidential and
without breach of this Agreement or which is independently developed or obtained
by the Executive without reliance upon any confidential information of the
Company or use of any Company resources. Notwithstanding anything in this
agreement to the contrary, the Executive may disclose Confidential Company
Information where the Executive is required to do so by law, regulation, court
order, subpoena, summons or other valid legal process; provided that the
Executive first (i) promptly notifies the Company, (ii) uses commercially
reasonable efforts to consult with the Company with respect to and in advance of
the disclosure thereof, and (iii) reasonably cooperates with the Company to
narrow the scope of the disclosure required to be made, in each case, solely at
the Company’s expense.
(ii) Notwithstanding anything to the contrary in this Agreement, nothing in this
Agreement shall prohibit or interfere with the Executive exercising protected
rights, including rights under the National Labor Relations Act; filing a charge
with the Equal Employment Opportunity Commission or OSHA; reporting possible
violations of law to or participating in an investigation by any federal, state
or local government agency or commission such as the National Labor Relations
Board, the Department of Labor or the Securities and Exchange Commission. The
Executive, however, waives any right to receive any monetary award or benefit
resulting from such a charge, report, or investigation, except that the
Executive may receive and fully retain a monetary award from a
government-administered whistle-blower award program.
(iii) The Executive is hereby notified that 18 U.S.C. § 1833(b) states as
follows: “An individual shall not be held criminally or civilly liable under any
Federal or State trade secret law for the disclosure of a trade secret that—(A)
is made—(i) in confidence to a Federal, State, or local government official,
either directly or indirectly, or to an attorney; and (ii) solely for the
purpose of reporting or investigating a suspected violation of law; or (B) is
made in a complaint or other document filed in a lawsuit or other proceeding, if
such filing is made under seal.” Accordingly, notwithstanding any other
provision of this Agreement to the contrary, the Executive has the right to (1)
disclose in confidence trade secrets to federal, state, and local government
officials, or to an attorney, for the sole purpose of reporting or investigating
a suspected violation of the law or (2) disclose trade secrets in a document
filed in a lawsuit or other proceeding so long as that filing is made under seal
and protected from public disclosure. Nothing in this Agreement is intended to
conflict with 18 U.S.C. § 1833(b) or create liability for disclosures of trade
secrets that are expressly allowed by 18 U.S.C. § 1833(b).
(c) During the Restricted Period, the Executive shall not, without the Company's
prior written consent, directly or indirectly, solicit or encourage to leave the
employment or other service of the Company or any of its subsidiaries, any
person or entity who is or was during the six-month period preceding the
Executive’s termination of employment, an employee, agent or independent
contractor of the Company or any of its subsidiaries. During the Restricted
Period, the Executive shall not, whether for his own account or for the account
of any other person, firm, corporation or other business organization, solicit
for a competing business or intentionally interfere with the Company's or any of
its subsidiaries’ relationship with, or endeavor to entice away from the Company
for a competing business, any person who is or was during the six month period
preceding the Executive's termination of employment, a customer, client, agent,
or independent contractor of the Company or any of its subsidiaries.
(d) All memoranda, notes, lists, records, property and any other tangible
product and documents (and all copies thereof), whether visually perceptible,
machine-readable or otherwise, made, produced or compiled by the Executive or
made available to the Executive containing Confidential Company Information (i)
shall at all times be the property of the Company (and, as applicable, any
affiliates) and shall be delivered to the
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Company at any time upon its request, and (ii) upon the Executive's termination
of employment, shall be promptly returned to the Company. This section shall not
apply to materials that the Executive possessed prior to his business
relationship with NSA or the Company, to the Executive's personal effects and
documents, and to materials prepared by the Executive for the purposes of
seeking legal or other professional advice.
(e) Other than in connection with either party enforcing its rights under this
Agreement, at no time during the Executive's employment by the Company or at any
time thereafter shall the Executive, on one hand, or the Company or any of its
subsidiaries, on the other hand, publish any statement or make any statement
under circumstances reasonably likely to become public that is critical of the
other party, or in any way otherwise be materially injurious to the Business or
reputation of the other party, unless otherwise required by applicable law or
regulation or by judicial order.
6.2 Rights and Remedies upon Breach.
(a) The parties hereto acknowledge and agree that any breach of any of the
provisions of Section 6 or any subparts thereof (individually or collectively,
the "Restrictive Covenants") may result in irreparable injury and damage for
which money damages would not provide an adequate remedy. Therefore, if the
either party breaches, or threatens to commit a breach of, any of the provisions
of Section 6 or any subpart thereof, the other party and its affiliates, in
addition to, and not in lieu of, any other rights and remedies available to the
other party and its affiliates under law or in equity (including, without
limitation, the recovery of damages), shall have the right and remedy to seek to
have the Restrictive Covenants or other obligations herein specifically enforced
(without posting bond and without the need to prove damages) by any court having
equity jurisdiction, including, without limitation, the right to an entry of
restraining orders and injunctions (preliminary, mandatory, temporary and
permanent) against violations, threatened or actual, and whether or not then
continuing, of such covenants.
(b) The Executive agrees that the provisions of Section 6 of this Agreement and
each subsection thereof are reasonably necessary for the protection of the
Company’s legitimate business interests and if enforced, will not prevent the
Executive from obtaining gainful employment should his employment with the
Company end. The Executive agrees that in any action seeking specific
performance or other equitable relief, the Executive will not assert or contend
that any of the provisions of this Section 6 are unreasonable or otherwise
unenforceable as drafted. The existence of any claim or cause of action by the
Executive, whether predicated on this Agreement or otherwise, shall not
constitute a defense to the enforcement of the Restrictive Covenants.
7.Other Provisions.
7.1 Severability. The Executive acknowledges and agrees that (i) he has had an
opportunity to seek advice of counsel in connection with this Agreement and (ii)
the Restrictive Covenants are reasonable in geographical and temporal scope and
in all other respects as drafted. If it is determined that any of the provisions
of this Agreement, including, without limitation, any of the Restrictive
Covenants, or any part thereof, is invalid or unenforceable, the remainder of
the provisions of this Agreement shall not thereby be affected and shall be
given full effect, without regard to the invalid portions.
7.2 Duration and Scope of Covenants. If any court or other decision-maker of
competent jurisdiction determines that any of the Executive's covenants
contained in this Agreement, including, without limitation, any of the
Restrictive Covenants, or any part thereof, is unenforceable because of the
duration or geographical scope of such provision, then the duration or scope of
such provision, as the case may be, shall be reduced so that such provision
becomes enforceable and, in its reduced form, such provision shall then be
enforceable and shall be enforced.
7.3 Enforceability; Jurisdiction; Arbitration.
(a) The Company and the Executive intend to and hereby confer jurisdiction to
enforce the Restrictive Covenants set forth in Section 6 upon the courts of any
jurisdiction within the geographical scope of the Restrictive Covenants. If the
courts of any one or more of such jurisdictions hold the Restrictive Covenants
wholly unenforceable by reason of breadth of scope or otherwise it is the
intention of the Company and
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the Executive that such determination not bar or in any way affect the Company's
right, or the right of any of its affiliates, to the relief provided above in
the courts of any other jurisdiction within the geographical scope of such
Restrictive Covenants, as to breaches of such Restrictive Covenants in such
other respective jurisdictions, such Restrictive Covenants as they relate to
each jurisdiction's being, for this purpose, severable, diverse and independent
covenants, subject, where appropriate, to the doctrine of res judicata. The
parties hereby agree to waive any right to a trial by jury for any and all
disputes hereunder (whether or not relating to the Restricted Covenants).
(b) Any controversy or claim arising out of or relating to this Agreement or the
breach of this Agreement (other than a controversy or claim arising under
Section 6, to the extent necessary for the Company (or its affiliates, where
applicable) to avail itself of the rights and remedies referred to in Section
6.2) that is not resolved by the Executive and the Company (or its affiliates,
where applicable) shall be submitted to arbitration in Denver, Colorado in
accordance with Colorado law and the employment arbitration rules and procedures
of the American Arbitration Association, before an arbitrator experienced in
employment disputes who is licensed to practice law in the State of Colorado.
The determination of the arbitrator shall be conclusive and binding on the
Company (or its affiliates, where applicable) and the Executive and judgment may
be entered on the arbitrator(s)' award in any court having jurisdiction. The
arbitration shall be held in Denver, Colorado.
(c) In the event of any dispute between the parties with respect to the terms of
this Agreement, the prevailing party in any legal proceeding or other action to
enforce the terms of this Agreement will be entitled to an award of attorneys’
fees incurred in connection with such proceeding or action.
7.4 Notices. Any notice or other communication required or permitted hereunder
shall be in writing and shall be delivered personally, sent by facsimile
transmission or sent by certified, registered or express mail, or overnight
courier, postage prepaid. Any such notice shall be deemed given when so
delivered personally, sent by facsimile transmission or, if mailed, five (5)
days after the date of deposit in the United States mails as follows:
(i) If to the Company or NSA, to:
National Storage Affiliates Trust 8400 East Prentice Avenue, 9th Floor
Greenwood Village, CO 80111
Attention: Tamara Fischer and Tiffany Kenyon
with a copy to (which shall not constitute notice to the Company):
Clifford Chance US LLP 31 West 52nd Street
New York, New York 10019-6131
Attention: Andrew Epstein
(ii) If to the Executive, to the address in the records of the Company.
Any such person may by notice given in accordance with this Section 7.4 to the
other parties hereto designate another address or person for receipt by such
person of notices hereunder.
7.5 Entire Agreement. This Agreement contains the entire agreement between the
parties with respect to the subject matter hereof and supersedes all prior
agreements, written or oral, with respect thereto.
7.6 Waivers and Amendments. This Agreement may be amended, superseded, canceled,
renewed or extended, and the terms hereof may be waived, only by a written
instrument signed by the parties or, in the case of a waiver, by the party
waiving compliance. Except as expressly provided herein, no delay on the part of
any party in exercising any right, power or privilege hereunder shall operate as
a waiver thereof, nor shall any waiver on the part of any party of any such
right, power or privilege nor any single or partial exercise of any such right,
power or privilege, preclude any other or further exercise thereof or the
exercise of any other such right, power or privilege.
7.7 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF MARYLAND WITHOUT
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REGARD TO ANY PRINCIPLES OF CONFLICTS OF LAW WHICH COULD CAUSE THE APPLICATION
OF THE LAWS OF ANY JURISDICTION OTHER THAN THE STATE OF MARYLAND.
7.8 Assignment. This Agreement, and the Executive's rights and obligations
hereunder, may not be assigned by the Executive; any purported assignment by the
Executive in violation hereof shall be null and void. Except as otherwise
provided by operation of law, in the event of any sale, transfer or other
disposition of all or substantially all of the Company's assets or business,
whether by merger, consolidation or otherwise, the Company may assign this
Agreement and its rights hereunder; provided that the successor or purchaser
agrees in writing, as a condition of such transaction, to assume all of the
Company's obligations hereunder.
7.9 Withholding. The Company shall be entitled to withhold from any payments or
deemed payments any amount of tax withholding it determines to be required by
law.
7.10 Binding Effect. This Agreement shall be binding upon and inure to the
benefit of the parties and their respective successors, permitted assigns,
heirs, executors and legal representatives.
7.11 Counterparts. This Agreement may be executed by the parties hereto in
separate counterparts, each of which when so executed and delivered shall be an
original but all such counterparts together shall constitute one and the same
instrument. Each counterpart may consist of two copies hereof each signed by one
of the parties hereto.
7.12 Survival. Anything contained in this Agreement to the contrary
notwithstanding, the provisions of Sections 4, 5, 6, and 7, shall survive any
termination of the Executive's employment hereunder and continue in full force
until performance of the obligations thereunder, if any, in accordance with
their respective terms.
7.13 Existing Agreements. The Executive represents to the Company that he is not
subject or a party to any employment or consulting agreement, non‑competition
covenant or other agreement, covenant or understanding which might prohibit him
from executing this Agreement or limit his ability to fulfill his
responsibilities hereunder.
7.14 Headings. The headings in this Agreement are for reference only and shall
not affect the interpretation of this Agreement.
7.15 Section 409A Compliance. Any payments under this Agreement that are deemed
to be deferred compensation subject to the requirements of Section 409A of the
Code are intended to comply with the requirements of Section 409A and this
Agreement shall be interpreted accordingly. To this end and notwithstanding any
other provision of this Agreement to the contrary, if at the time of the
Executive's termination of employment with the Company, (i) the Company's
securities are publicly traded on an established securities market; (ii)
Executive is a "specified employee" (as defined in Section 409A); and (iii) the
deferral of the commencement of any payments or benefits otherwise payable
pursuant to this Agreement as a result of such termination of employment is
necessary in order to prevent any accelerated or additional tax under Section
409A, then the Company will defer the commencement of such payments (without any
reduction in amount ultimately paid or provided to the Executive). Such deferral
shall last until the date that is six months following the Executive's
termination of employment with the Company (or the earliest date as is permitted
under Section 409A). Any amounts the payment of which are so deferred shall be
paid in a lump sum payment on the first day of the seventh month following the
end of such deferral period. If the Executive dies during the deferral period
prior to the payment of any deferred amount, then the unpaid deferred amount
shall be paid to the personal representative of the Executive's estate within
sixty (60) days after the date of the Executive's death. For purposes of Section
409A, the Executive's right to receive installment payments pursuant to this
Agreement including, without limitation, any COBRA (Consolidated Omnibus Budget
Reconciliation Act) continuation reimbursement shall be treated as a right to
receive a series of separate and distinct payments. The Executive will be deemed
to have a date of termination for purposes of determining the timing of any
payments or benefits hereunder that are classified as deferred compensation only
upon a "separation from service" within the meaning of Section 409A. Any amount
that the Executive is entitled to be reimbursed under this Agreement will be
reimbursed to the Executive as promptly as practical and in any event not later
than the last day of the calendar quarter after the calendar quarter in which
the expenses are incurred, any right to
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reimbursement or in kind benefits will not be subject to liquidation or exchange
for another benefit, and the amount of the expenses eligible for reimbursement
during any taxable year will not affect the amount of expenses eligible for
reimbursement in any other taxable year. Whenever a payment under this Agreement
specifies a payment period with reference to a number of days (e.g., "payment
shall be made within thirty (30) days following the date of termination"), the
actual date of payment within the specified period shall be within the
reasonable discretion of the Company. For purposes of Section 409A, any payment
to be made to the Executive after receipt of an executed and irrevocable release
within any specified period, in which such period begins in one taxable year of
Executive and ends in a second taxable year of Executive, will be made in the
second taxable year.
The parties agree to consider any amendments or modifications to this Agreement
or any other compensation arrangement between the parties, as reasonably
requested by the other party, that is necessary to cause such agreement or
arrangement to comply with Section 409A (or an exception thereto); provided that
such proposed amendment or modification does not change the economics of the
agreement or arrangement and does not provide for any additional cost to either
party. Notwithstanding the foregoing, the parties will not be obligated to make
any amendment or modification and the Company makes no representation or
warranty with respect to compliance with Section 409A and shall have no
liability to the Executive or any other person if any provision of this
Agreement or such other arrangement are determined to constitute deferred
compensation subject to Section 409A that does not satisfy an exemption from, or
the conditions of, such Section.
7.16 Parachute Payments. If there is a change in ownership or control of the
Company that would cause any payment or distribution by the Company or any other
person or entity to the Executive or for the Executive's benefit (whether paid
or payable or distributed or distributable pursuant to the terms of this
Agreement or otherwise) (a "Payment") to be subject to the excise tax imposed by
Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code") (such
excise tax, together with any interest or penalties incurred by the Executive
with respect to such excise tax, the "Excise Tax"), then the Executive will
receive the greatest of the following, whichever gives the Executive the highest
net after-tax amount (after taking into account federal, state, local and social
security taxes): (a) the Payments or (b) one dollar less than the amount of the
Payments that would subject the Executive to the Excise Tax (the "Safe Harbor
Amount"). If a reduction in the Payments is necessary so that the Payments equal
the Safe Harbor Amount and none of the Payments constitutes non‑qualified
deferred compensation (within the meaning of Section 409A of the Code), then the
reduction shall occur in the manner the Executive elects in writing prior to the
date of payment. If any Payment constitutes non‑qualified deferred compensation
or if the Executive fails to elect an order, then the Payments to be reduced
will be determined in a manner which has the least economic cost to the
Executive and, to the extent the economic cost is equivalent, will be reduced in
the inverse order of when payment would have been made to the Executive, until
the reduction is achieved. All determinations required to be made under this
Section 7.16, including whether and when the Safe Harbor Amount is required and
the amount of the reduction of the Payments and the assumptions to be utilized
in arriving at such determination, shall be made by a certified public
accounting firm designated by the Company (the "Accounting Firm"). All fees and
expenses of the Accounting Firm shall be borne solely by the Company. Any
determination by the Accounting Firm shall be binding upon Company and the
Executive.

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IN WITNESS WHEREOF, the parties hereto have signed their names as of the day and
year first above written.
NATIONAL STORAGE AFFILIATES TRUST
By: /s/ Tamara D. Fischer
Name: Tamara Fischer
Title: President and Chief Executive Officer

ARLEN D. NORDHAGEN
/s/ Arlen D. Nordhagen

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EXHIBIT A

Exh. A-1

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EXHIBIT B
FORM OF WAIVER AND RELEASE
This Waiver and General Release of all Claims (this "Agreement") is entered into
by Arlen D. Nordhagen (the "Executive") and National Storage Affiliates Trust, a
Maryland real estate investment trust (the "Company"), effective as of
____________________ (the "Effective Date").
In consideration of the promises set forth in the Employment Agreement between
the Executive and the Company, dated __________________ (the "Employment
Agreement"), the Executive and the Company agree as follows:
1. General Releases and Waivers of Claims.
(a) Executive's Release of Company. In consideration of the payments and
benefits provided to the Executive under [Section 4/5.2(c)] of the Employment
Agreement and after consultation with counsel, the Executive (or his estate, as
applicable) hereby irrevocably and unconditionally releases and forever
discharges the Company and its past, present and future parent entities,
subsidiaries, divisions, affiliates and related business entities, any of its or
their successors and assigns, assets, employee benefit plans or funds, and any
of its or their respective past, present and/or future directors, officers,
fiduciaries, agents, trustees, administrators, managers, supervisors,
stockholders, employees and assigns, whether acting on behalf of the Company or
in their individual capacities (collectively, "Company Parties") from any and
all claims, actions, causes of action, rights, judgments, obligations, damages,
demands, accountings or liabilities of whatever kind or character (collectively,
"Claims"), including, without limitation, any Claims under any federal, state,
local or foreign law, that the Executive (or his estate, as applicable) may
have, or in the future may possess, arising out of the Executive's employment
relationship with and service as an employee, officer or director of the
Company, and the termination of such relationship or service; provided, however,
that the Executive (or his estate, as applicable) does not release, discharge or
waive (A) any rights to payments and benefits provided under the Employment
Agreement, (B) any right the Executive (or his estate, as applicable) may have
to enforce this Agreement, the Award Agreements or the Employment Agreement or
any other rights as a member, shareholder or partner of the Company or its
affiliates, (C) the Executive’s rights under any indemnification agreement with
the Company and rights to indemnification and advancement of expenses in
accordance with the Company’s certificate of incorporation, bylaws or other
corporate governance document, or any applicable insurance policy, (D) any
claims for benefits under any employee benefit or pension plan of the Company
Parties subject to the terms and conditions of such plan and applicable law
including, without limitation, any such claims under the Employee Retirement
Income Security Act of 1974, or (E) any right or claim that the Executive (or
his estate, as applicable) may have to obtain contributions as permitted by
applicable law in an action in which both the Executive on the one hand or any
Company Party on the other hand are held jointly liable.
(b) Executive's Specific Release of ADEA Claims. In further consideration of the
payments and benefits provided to the Executive under [Section 4/5.2(c)] of the
Employment Agreement, the Executive hereby unconditionally release and forever
discharge the Company Parties from any and all Claims that the Executive may
have as of the date the Executive signs this Agreement arising under the Federal
Age Discrimination in Employment Act of 1967, as amended, and the applicable
rules and regulations promulgated thereunder ("ADEA"). By signing this
Agreement, the Executive hereby acknowledges and confirms the following: (i) the
Executive was advised by the Company in connection with his termination to
consult with an attorney of his choice prior to signing this Agreement and to
have such attorney explain to the Executive the terms of this Agreement,
including, without limitation, the terms relating to the Executive’s release of
claims arising under ADEA, and the Executive has been given the opportunity to
do so; (ii) the Executive was given a period of not fewer than twenty-one (21)
days to consider the terms of this Agreement and to consult with an attorney of
his choosing with respect thereto; and (iii) the Executive knowingly and
voluntarily accepts the terms of this Agreement. The Executive also understands
that he has seven days following the date on which he signs this Agreement
within which to revoke the release contained in this paragraph, by providing the
Company a written notice of his revocation of the release and waiver contained
in this paragraph.
Exh. B-1

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(c) No Assignment. The Executive (or his estate, as applicable) represents and
warrants that he has not assigned any of the Claims being released under this
Agreement.
2. Waiver of Relief. The Executive (or his estate, as applicable) acknowledges
and agrees that by virtue of the foregoing, the Executive (or his estate, as
applicable) has waived any relief available to him/it (including without
limitation, monetary damages and equitable relief, and reinstatement) under any
of the Claims waived in paragraph 2. Therefore the Executive (or his estate, as
applicable) agrees that he/it will not accept any award or settlement from any
source or proceeding (including but not limited to any proceeding brought by any
other person or by any government agency) with respect to any Claim or right
waived in this Agreement. Nothing in this Agreement shall be construed to
prevent the Executive (or his estate, as applicable) from cooperating with or
participating in an investigation conducted by, any governmental agency, to the
extent required or permitted by law.
3. Severability Clause. In the event any provision or part of this Agreement is
found to be invalid or unenforceable, only that particular provision or part so
found, and not the entire Agreement, will be inoperative.
4. Non‑admission. Nothing contained in this Agreement will be deemed or
construed as an admission of wrongdoing or liability on the part of the Company
or any other Company Party or the Executive.
5. Governing Law. All matters affecting this Agreement, including the validity
thereof, are to be governed by, and interpreted and construed in accordance
with, the laws of the State of Maryland applicable to contracts executed in and
to be performed in that State.
6. Arbitration. Any dispute or controversy arising under or in connection with
this Agreement shall be resolved in accordance with Section 7.3 of the
Employment Agreement.
7. Notices. All notices or communications hereunder shall be made in accordance
with Section 7.4 of the Employment Agreement.
THE EXECUTIVE (OR HIS ESTATE, AS APPLICABLE) ACKNOWLEDGES THAT HE HAS READ THIS
AGREEMENT AND THAT HE/IT FULLY KNOWS, UNDERSTANDS AND APPRECIATES ITS CONTENTS,
AND THAT HE/IT HEREBY EXECUTES THE SAME AND MAKES THIS AGREEMENT AND THE RELEASE
AND AGREEMENTS PROVIDED FOR HEREIN VOLUNTARILY AND OF HIS/ITS OWN FREE WILL.
By:
Date:
NATIONAL STORAGE AFFILIATES TRUST
By:
Name:
Title:
Exh. B-1