Exhibit 10.13


 


2004 NON-EMPLOYEE DIRECTOR SHARE PLAN OPTION AWARD AGREEMENT
FOR DIRECTORS


 


EXTRA SPACE STORAGE INC.


2004 NON-EMPLOYEE DIRECTORS’ SHARE PLAN


 


OPTION AWARD AGREEMENT


 


AGREEMENT
by and between Extra Space Storage Inc., a self-administered Maryland
corporation (the “Company”) and                     
(the “Participant”), dated as of the 12th day of August, 2004.


 


WHEREAS,
the Company maintains the Extra Space Storage Inc. 2004 Non-Employee Directors’
Share Plan (as amended from time to time, the “Plan”) (capitalized terms used
but not defined herein shall have the respective meanings ascribed thereto by
the Plan (which are set forth in Appendix A, attached hereto for your
convenience));


 


WHEREAS,
the Participant is a director; and


 


WHEREAS,
the compensation committee has determined that it is in the best interests of
the Company and its shareholders to grant a stock option to the Participant
subject to the terms and conditions set forth below.


 


NOW,
THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:


 


1.
Grant of Stock Option.


 


The
Company hereby grants the Participant an Option to purchase         
shares of Common Stock, subject to the following terms and conditions and
subject to the provisions of the Plan. The Plan is hereby incorporated herein
by reference as though set forth herein in its entirety.


 


The
Option is not intended to be and shall not be qualified as an “incentive stock
option” under Section 422 of the Code.


 


2.
Option Price.


 


The
Option Price per Share shall be $12.50.


 

















 


3. Initial Exercisability.


 


(e)             Subject to paragraph 5 below,
the Option, to the extent that there has been no termination of the
Participant’s service and the Option has not otherwise expired or been
forfeited, shall become exercisable as follows:


 


	
  For the Period Ending On

  	
   

  	
  Percent of the Grant Exercisable

  
	
  August 12, 2005

  	
   

  	
  25%

  
	
  August 12, 2006

  	
   

  	
  25%

  
	
  August 12, 2007

  	
   

  	
  25%

  
	
  August 12, 2008

  	
   

  	
  25%

  



 


(f)               Notwithstanding the
foregoing, a Participant’s Option will become immediately exercisable in full
at the time the Participant ceases to serve as a director due to death or
disability or upon a Change in Control.


 


4.
Exercisability Upon and After Termination of Participant.


 


(a)             In the event of the
Participant ceases to serve as a director by reason other than on account of
death or disability, no exercise of the Option may occur after the expiration
of the two-month period to follow such termination, or if earlier, the
expiration of the term of the Option set forth in paragraph 5 below; provided
that, if the Participant should die after a cessation of service as a director,
the Option (if and to the extent otherwise exercisable under paragraph 3 above)
may be exercised in the manner provided by the Plan until the earlier of (i) one
year from the date the Participant ceases to serve as a director of the
Company, or (ii) the date on which the term of the Option expires in
accordance with paragraph 5 below.


 


(b)            In the event the Participant
ceases to serve as a director on account of death or disability, the
Participant’s Option (whether or not otherwise exercisable) may be exercised
until the earlier of (i) one year from the date the Participant ceases to
serve as a director, or (ii) the date on which the term of the Option as
provided under paragraph 5 below.


 


(c)             Unless otherwise provided
herein, no Option (or portion thereof) which had not become exercisable at the
time of cessation of service shall ever be or become exercisable.


 


(d)            The compensation committee
may, in its sole discretion, accelerate the vesting of any Option upon the
cessation of the Participant’s service for any reason.


 


5.
Term.


 


Unless
earlier forfeited, the Option shall, notwithstanding any other provision of
this Agreement, expire in its entirety at the earlier of (i) the 10th
anniversary of the date hereof or (ii) one year after the date the
Participant ceases to serve as a director for any reason.


 


6.
Miscellaneous.


 


(a)             THIS
AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF MARYLAND WITHOUT
REFERENCE TO PRINCIPLES OF CONFLICT OF LAWS.  The captions of this Agreement are not part
of the provisions hereof and shall have no force or effect. This Agreement may
not be amended or modified except by a written agreement executed by the
parties hereto or their respective successors and legal representatives. The invalidity
or unenforceability of any provision of this Agreement shall not affect the
validity or enforceability of any other provision of this Agreement.


 


(b)            The compensation committee
may make such rules and regulations and establish such procedures for the
administration of this Agreement as it deems appropriate. Without limiting the
generality of the foregoing, the compensation committee may interpret this
Agreement, with such interpretations to be conclusive and binding on all
persons and otherwise accorded the maximum


 


2

















 


deference
permitted by law, provided that the compensation committee’s interpretation
shall not be entitled to deference on and after a Change in Control except to
the extent that such interpretations are made exclusively by members of the
compensation committee who are individuals who served as compensation committee
members before the Change in Control. In the event of any dispute or
disagreement as to the interpretation of this Agreement or of any rule,
regulation or procedure, or as to any question, right or obligation arising
from or related to this Agreement, the decision of the compensation committee
shall be final and binding upon all persons.


 


(c)             All notices hereunder shall be
in writing, and if to the Company or the compensation committee, shall be
delivered to the board of directors of the Company (the “Board”) or mailed to
its principal office, addressed to the attention of the Board; and if to the
Participant, shall be delivered personally, sent by email or facsimile
transmission or mailed to the Participant at the address appearing in the
records of the Company. Such addresses may be changed at any time by written
notice to the other party given in accordance with this paragraph 6(c).


 


(d)            The failure of the
Participant or the Company to insist upon strict compliance with any provision
of this Agreement or the Plan, or to assert any right the Participant or the
Company, respectively, may have under this Agreement or the Plan, shall not be
deemed to be a waiver of such provision or right or any other provision or
right of this Agreement or the Plan.


 


(e)             The Participant agrees that,
at the request of the compensation committee, the Participant shall represent
to the Company in writing that the shares being acquired are acquired for
investment only and not with a view to distribution and that such shares will
be disposed of only if registered for sale under the Securities Act, or if
there is an available exemption for such disposition. The Participant expressly
understands and agrees that, in the event of such a request, the making of such
representation shall be a condition precedent to receipt of Shares upon
exercise of the Option.


 


(f)               Nothing in this Agreement
shall confer on the Participant any right to continue in the service of the
Company or its subsidiaries or interfere in any way with the right of the
Company or its subsidiaries to terminate the Participant’s service at any time.


 


(g)            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.


 


IN
WITNESS WHEREOF, the Company and the Participant have executed this Agreement
as of the day and year first above written.


 


 


	
  EXTRA
  SPACE STORAGE INC.

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  [Participant’s
  Name]

  	
   

  



 


Appendix A


 


Please
note, the definitions contained in this Appendix A are provided for your
convenience, and at all times, such definitions shall have the meaning ascribed
thereto under the Plan, as may be amended from time to time.


 


3

















 


“Board” means the Board of Directors of the Company.


 


“Change
in Control” shall have occurred if:


 


(i) any
“person,” including a “group” (as such terms are used in Sections 13(d) and
14(d) of the Exchange Act, but excluding (A) the Company, (B) any
entity controlling, controlled by or under common control with the Company, (C) any
employee benefit plan of the Company or any entity described in clause (B), (D) with
respect to any particular Participant, the Participant and any “group” (as such
term is used in Section 13(d)(3) of the Exchange Act) of which the
Participant is a member), (E) Kenneth M. Woolley, his affiliates,
associates and people acting in concert with any of the foregoing and (F) Spencer
F. Kirk, his affiliates, associates and people acting in concert with any of
the foregoing, is or becomes the “beneficial owner” (as defined in Rule 13(d)(3) under
the Exchange Act), directly or indirectly, of securities of the Company
representing 20% or more of either (1) the combined voting power of the
Company’s then outstanding securities or (2) the then outstanding Shares
(in either such case other than as a result of an acquisition of securities
directly from the Company); provided, however, that, in no event shall a Change
in Control be deemed to have occurred upon an initial public offering of the
Company’s common stock under the Securities Act; or


 


(ii) any
consolidation or merger of the Company where the shareholders of the Company,
immediately prior to the consolidation or merger, would not, immediately after
the consolidation or merger, beneficially own (as such term is defined in Rule 13d-3
under the Exchange Act), directly or indirectly, shares representing in the
aggregate 50% or more of the combined voting power of the securities of the
corporation issuing cash or securities in the consolidation or merger (or of
its ultimate parent corporation, if any); or


 


(iii) there
shall occur (A) any sale, lease, exchange or other transfer (in one
transaction or a series of transactions contemplated or arranged by any party
as a single plan) of all or substantially all of the assets of the Company,
other than a sale or disposition by the Company of all or substantially all of
the Company’s assets to an entity, at least 50% of the combined voting power of
the voting securities of which are owned by “persons” (as defined above) in
substantially the same proportion as their ownership of the Company immediately
prior to such sale or (B) the approval by shareholders of the Company of
any plan or proposal for the liquidation or dissolution of the Company; or


 


(iv) the
members of the Board at the beginning of any consecutive 24-calendar-month
period (the “Incumbent Directors”) cease for any reason other than due to death
to constitute at least a majority of the members of the Board; provided that
any director whose election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of the members of
the Board then still in office who were members of the Board at the beginning
of such 24-calendar-month period, shall be deemed to be an Incumbent Director.


 


“Code”
means the Internal Revenue Code of 1986, as amended from time to time.
References to any provision of the Code include regulations thereunder and
successor provisions and regulations thereto.


 


“Common
Stock” means the Company’s Common Stock, par value $.01 per share, either currently
existing or authorized hereafter.


 


“Option”
means the right, granted to a director under Section 6 of the Plan, to
purchase a specified number of Shares at the specified exercise price for a
specified period of time under the Plan. No Option shall be intended to qualify
as an “incentive stock option” under Section 422 of the Code.


 


“Option
Price” means the exercise price per Share.


 


4

















 


“Participant”
means any person who, as a non-employee director of the Company, has been
granted an Option which remain outstanding under the Plan


 


“Securities
Act” means the Securities Act of 1933, as amended.


 


“Share”
means a common share of the Company and such other securities as may be
substituted for such Share or such other securities pursuant to Section 7
of the Plan.


 


5

















 


Schedule
to Exhibit 10.13


 


As of the date of filing
this report, the Company has entered into this form of Share Plan Option Award
Agreement with each of its non-employee directors, including:  Anthony Fanticola, Hugh W. Horne, Joseph D.
Margolis, Roger B. Porter and K. Fred Skousen. 
In accordance with Instruction 2 to Item 601 of Regulation S-K, the
Company has filed only the form of such agreement as the award agreements are
substantially identical in all material respects, except as to the parties
thereto, the dates of execution, the number of stock options awarded and the
exercise price of such options.  The Company
agrees to furnish the agreements at the request of the SEC.