Document:

EX-10.11

 

Exhibit 10.11

FORM OF OPTION AGREEMENT

     THIS OPTION AGREEMENT (this “Agreement”) is made as of October,    2004
by and between U-Store-It, L.P., a Delaware limited partnership (“USI”), and
Rising Tide Development, LLC, an Ohio limited liability company (“Optionor”).

R E C I T A L S

     WHEREAS, USI, the general partner of which is U-Store-It Trust, a Maryland
real estate investment trust (the “REIT”), and the REIT are engaging in various
related transactions pursuant to which, among other things, the REIT will
effect an initial public offering of its common shares and contribute the
proceeds therefrom for units of partnership interest in USI (the “IPO,” and
together with the transactions related thereto, the “IPO Transactions”);

     WHEREAS, Optionor currently owns ten, and has entered into contracts to
purchase an additional eight, self-storage facilities listed on Exhibit A
attached hereto and made a part hereof (the “Option Properties,” and
individually, each an “Option Property”), which Option Properties are located
on the eighteen tracts or parcels of land described on Exhibit B (such tracts
or parcels of land, together with the rights and appurtenances pertaining to
each parcel or tract of land, including any right, title and interest of
Optionor in and to adjacent streets, alleys or rights-of-way to each such tract
or parcel herein is referred to as the “Land”); and

     WHEREAS, Optionor desires to grant to USI an option to acquire all of
Optionor’s right, title and interest in and to each Option Property, including
(i) the Land related to such Option Property, (ii) the buildings, structures,
fixtures and other improvements on the Land related to such Option Property
(herein referred to collectively as the “Improvements”), (iii) the tangible and
intangible personal property owned by Optionor used or useful in connection
with the Optionor’s businesses being carried out on the Land and the
Improvements related to such Option Property (the “Personal Property”), and
(iv) each of the following: (A) each lease and other occupancy agreement for
any portion of the Land or the Improvements related to such Option Property
(collectively, the “Leases”), including all deposits and escrows held in
connection therewith, and (B) each other contract of the Optionor related to
such Option Property (the “Other Contracts”) (it being understood that the
“Other Contracts” shall not include the management agreements or service
agreements applicable to the Option Properties), in each case referred to in
subsections (A) and (B), to be identified by USI with the assistance of the
Optionor as of the Closing Date (as defined below); as used herein, the term
“Option Property” shall include the Land, Improvements, Personal Property,
Leases and Other Contracts related to such Option Property.

     NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and conditions set forth herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties agree as
follows:

1

 

ARTICLE I – THE OPTION

     1.1 Applicability of Option. The Option (as defined below) shall be
exercisable with respect to each Option Property during the Option Term (as
defined below). In the event that USI exercises the Option at multiple and
separate times with respect to separate Option Properties (as opposed to USI
exercising the Option with respect to each Option Property simultaneously), a
separate Closing shall be held for each instance of USI exercising the Option.

     1.2 Grant of Option. Subject to the terms and conditions hereof:

     (a) Optionor hereby grants to USI an option to acquire all right, title
and interest of Optionor in and to each Option Property free and clear of any
Encumbrances (as defined below) on such Option Property, other than Permitted
Encumbrances (as defined below) with respect to such Option Property (the
“Option”). It is understood that the Option shall apply to all of the eighteen
Option Properties notwithstanding that eight of the Option Properties are under
contract but not owned by Optionor as of the date hereof. For the avoidance of
doubt, however, the Option shall not become eligible for exercise for any of
the eight Option Properties identified on Exhibit A as being under contract as
of the date hereof unless and until the Optionor consummates the purchase of
such Option Property.

     (b) If USI exercises the Option with respect to an Option Property, at
the Closing Date (as defined below) for such Option Property, USI shall assume
and thereafter pay, honor, discharge and perform, in accordance with their
respective terms, all of the liabilities and obligations of the Optionor with
respect to such Option Property identified on Schedule 1 hereto (the “Assumed
Liabilities”) first accruing from and after the Closing Date.

     1.3 Right to Exercise. USI shall have the right to exercise the Option
with respect to an Option Property at any time after the date upon which such
Option Property has achieved occupancy of at least 85% on the last day of the
month for three consecutive months (with occupancy being the ratio of occupied
square footage to total rentable square footage), until the expiration of the
Option pursuant to Section 1.4. Optionor shall promptly notify USI upon the
occurrence of any Option Property reaching the foregoing occupancy threshold.
Notwithstanding the foregoing, in the event that the IPO is not consummated
prior to February 15, 2005, this Agreement shall terminate, become null and
void and no party shall have any liability to the other parties hereunder with
respect to the transactions contemplated hereby.

     1.4 Expiration of Option. Subject to Section 8.1 hereof, the Option shall
expire on the fourth anniversary of the date of the closing of the IPO (the
“Expiration Date”; and the period from the closing of the IPO through the
Expiration Date, the “Option Term”).

     1.5 Obligation to Sell Upon Expiration of Option. If (i) USI fails to
exercise the Option with respect to any Option Property prior to the expiration
of the Option Term, or (ii) the Option does not become exercisable with respect
to any Option Property pursuant to Section 1.3 hereof prior to the expiration
of the Option Term, then Optionor shall be required to use all commercially
reasonable efforts to sell, convey or otherwise transfer as promptly as
practicable such Option Property to an unaffiliated third party.

 

 

     1.6 Prohibition on Purchase of Option Properties. Optionor acknowledges
that it is an affiliate of Robert J. Amsdell and Barry L. Amsdell (the
“Affiliated Persons”). Each of the Affiliated Persons shall not, and shall
cause their respective affiliates (other than Optionor, the REIT or any of its
subsidiaries), not to, purchase any of the eight Option Properties identified
on Exhibit A as being under contract as of the date hereof.

ARTICLE II – PROCESS FOR EXERCISE OF THE OPTION

     2.1 Exercise. Subject to Section 1.3 hereof, the Option may be exercised
with respect to any Option Property during the Option Term by delivery of
written notice by USI to Optionor (the “Exercise Notice”), stating that the
Option is exercised on the terms set forth in this Agreement. The date upon
which the Exercise Notice is delivered by Optionor in accordance with this
Agreement is hereinafter referred to as the “Exercise Date.” If the Option is
timely exercised, the Optionor shall transfer and convey the applicable Option
Property, and the closing of such transfer and conveyance (the “Closing”) shall
occur within 15 days after the last day of the month immediately following the
month in which the Exercise Notice is delivered (the date of the Closing is
referred to herein as the “Closing Date”). The exercise of the Option by USI
is subject to the pre-approval of a majority of the “independent” members of
the Board of Trustees of the REIT (as defined in the REIT’s Bylaws), as general
partner of USI, and no exercise may occur without such pre-approval.

     2.2 Inspection. During the term of this Agreement, Optionor shall permit
USI and its agents to enter upon each Option Property, subject to the rights of
any tenants, at reasonable times to make such surveys, inspections and tests as
may reasonably be necessary in connection with its examination of the Option
Property. USI hereby agrees to repair any damage it or its agents may cause to
the Option Property as a result of any such inspections or tests or any other
related damage caused by USI or its agents, and further shall indemnify, defend
and hold Optionor and Optionor’s managers harmless from and against any and all
claims, losses, damages and expenses, including, without limitation, reasonable
attorneys’ fees, suffered by Optionor and Optionor’s managers as a direct
result of the entry by USI or its agents upon, or acts upon, any Option
Property in connection with any such inspections or tests or any other related
damage caused by USI or its agents.

     2.3 Information. Optionor shall permit USI and its agents to review all
books, records and other documentation which are in Optionor’s possession and
control reasonably requested by USI with respect to Optionor and/or any Option
Property. Optionor shall provide (or cause to be provided), upon request from
USI, a report of the status of each Option Property, on a quarterly basis,
which report shall include unaudited financials and such other information and
data as USI may reasonably request regarding each Option Property (to the
extent within Optionor’s possession and control); it being understood that, to
the extent USI or any of its subsidiaries or affiliated entities is providing
administrative services to Optionor with respect to any Option Property,
Optionor shall be deemed to have satisfied its obligation under this Section
2.3 to the extent that the information requested by this Section 2.3 is
available to USI or such subsidiaries or affiliated entities in connection with
the performance of such administrative services, and such information should be
deemed to have been delivered by Optionor to USI pursuant to this Section 2.3.

 

 

ARTICLE III – ACQUISITION PROCESS

     3.1 Acquisition Consideration.

     (a) The acquisition consideration to be paid by USI for any Option
Property (the “Acquisition Consideration”) pursuant to an exercise of the
Option under Section 2.1 shall be equal to the lower of (i) the product
obtained by multiplying (A) Annualized NOI for such Option Property by (B) 12.5
and (ii) the fair market value of the Option Property (“FMV”), as determined
pursuant to this Section 3.1. “Annualized NOI” shall mean the net operating
income for the Option Property for the three months immediately prior to the
month in which the Exercise Notice is delivered multiplied by 4. Net operating
income shall mean net income for the Option Property plus interest expense,
loan procurement amortization expense (if applicable), depreciation, management
fees to related parties/general and administrative (if applicable)(and, in each
case, otherwise in a manner consistent with the manner in which net operating
income was determined for purposes of the disclosure in the prospectus for
USI’s initial public offering). “FMV” for purposes of this Section 3.1 shall
mean the price at which a willing buyer would buy, and a willing seller would
sell, such Option Property in an arms-length transaction assuming such Option
Property is sold in an orderly disposition on the terms (other than purchase
price) set out in this Agreement and each of the buyer and seller are aware of,
and take into account, all relevant factors which exist at the time. In the
Exercise Notice, USI shall designate an appraiser (the “First Appraiser”) to
determine FMV for such Option Property. Optionor then shall have 10 days after
receiving such notice to designate a second appraiser (the “Second Appraiser”)
by written notice to USI. If Optionor fails to timely designate the Second
Appraiser, FMV shall be determined by the First Appraiser. The First Appraiser
and the Second Appraiser each shall separately determine FMV in accordance with
this Section 3.1(a) and shall provide a detailed written valuation report to
each of Optionor and USI within 20 days after the last day for designating the
Second Appraiser. The designation of the First Appraiser shall be approved by
a majority of the members of the Board of Trustees of the REIT, which majority
must include a majority of “independent” trustees, as defined in the REIT’s
Bylaws. If only one appraiser timely submits a proper valuation report, its
FMV determination shall be final, binding and conclusive for purposes of this
Agreement. If both appraisers timely submit proper valuation reports, and
their FMV determinations vary by 10% or less, FMV shall be equal to the average
of the two FMV determinations. If both appraisers timely submit proper
valuation reports, and their FMV determinations vary by more than 10%, the two
appraisers shall promptly appoint a third appraiser (the “Third Appraiser”),
which shall independently determine FMV in accordance with Section 3.1(a) and
shall provide a detailed written valuation report to each of Optionor and USI
within 20 days after its appointment. FMV shall then be equal to the average
of the two closest FMV determinations submitted by the three appraisers. FMV
as determined in accordance with Section 3.1(a) shall be final, binding and
conclusive for purposes of this Agreement. If a Third Appraiser is required to
be appointed pursuant hereto, the Closing Date shall be a date within 15 days
after receipt of the written valuation report of such Third Appraiser. In
preparing its FMV determination, each appraiser shall be provided with the same
Option Property-specific source documents and information and the same access
to personnel. Each appraiser shall determine a single point estimate of FMV,
not a range of values. Only qualified real estate appraisers with at least
five years’ prior experience in the

 

 

valuation of properties comparable to such Option Property, and that do not
have any financial interest in any entities affiliated with any party hereto
(excluding any existing or prior agreement or contractual arrangement to
provide advisory or appraisal services to any such parties or any affiliates
thereof), may be validly appointed to serve as an appraiser hereunder. Each of
Optionor and USI shall pay all fees and costs of the appraiser designated by it
and one-half of all fees and costs of the Third Appraiser, if any.

     (b) On the Closing Date with respect to an Option Property, the
Acquisition Consideration shall be payable by USI in (i) cash, or (ii) a
combination of units of limited partnership interest in USI (“Units”) and cash,
in the sole and absolute discretion of USI; provided however, that the cash
consideration portion of the Acquisition Consideration for an Option Property
shall in no event be less than the Allocated Loan Amount (as defined below) for
such Option Property or, if less, the release price required under any
financing then secured by the Option Property. If the Allocated Loan Amount is
greater than the Acquisition Consideration for an Option Property, then the
full amount of the Acquisition Consideration shall be paid in cash. The term
“Allocated Loan Amount” for any Option Property shall mean the full amount of
first mortgage indebtedness allocable to that Option Property as of the Closing
Date for such Option Property as provided in the loan documents relating
thereto. The value of Units shall be their “Market Value” as defined in this
Section 3.1(b), and the number of Units shall be rounded to the nearest whole
number of Units to avoid the issuance of fractional Units. The term “Market
Value” shall mean the average closing price of the common shares of beneficial
interest, $0.01 par value per share, of the REIT (or any successor thereto)
(“Common Shares”) for the 10 consecutive trading days immediately preceding,
but not including, the Closing Date. For purposes of determining Market Value,
one Unit shall equal one Common Share, subject to any adjustments required
under the Second Amended and Restated Agreement of Limited Partnership of
U-Store-It, L.P., as may be amended and/or restated from time to time (the
“Partnership Agreement”), or to reflect stock splits, reclassifications,
dividends in-kind and the like.

          (c) On the Closing Date, all reserves held by or on behalf of Optionor as
required by applicable lenders or otherwise with respect to an Option Property
shall either be (i) retained by or returned to Optionor, or (ii) transferred to
USI, in which event a credit shall be applied to increase the Acquisition
Consideration by the amount of such transferred reserves.

          (d) In exercising the Option with respect to any Option Property, USI will
use reasonable efforts to cooperate with Optionor to minimize any fees or
prepayment penalties payable in connection with such exercise; provided that,
except as otherwise set forth in this Agreement, such cooperation shall not
require USI to unreasonably delay the Closing Date or require USI to assume
additional liabilities or incur any material amount of out-of-pocket expenses.

          (e) Pursuant to the Partnership Agreement, Units are exchangeable into
Common Shares. It is currently anticipated that such Common Shares will be
entitled to certain registration rights consistent with the REIT’s practice at
the time such Units are issued and subject to any restrictions or agreements
affecting such rights to which the REIT or USI is bound.

 

 

          (f) USI may decide at any time after delivery of an Exercise Notice, but
before the Closing Date, not to proceed with the acquisition of an Option
Property as specified in the Exercise Notice. If USI revokes the Exercise
Notice before the Closing Date, USI shall promptly notify Optionor of such
revocation. The revocation by USI of the Exercise Notice shall be deemed
effective upon the earlier of the mailing of such revocation to Optionor by
USI, or upon Optionor’s acknowledgement, whether written or oral, of USI’s
revocation.

     3.2 Acquisition Documentation. On or prior to the Closing Date (subject
to Section 3.1(f)) with respect to an Option Property, Optionor and USI shall
acknowledge, execute, deliver and/or file (as the case may be) the closing
documentation described on Annex A hereto (the “Closing Documentation”).
Optionor and USI shall thereafter additionally acknowledge, execute, deliver
and/or file (as the case may be) any and all other documents, agreements or
instruments reasonably necessary or appropriate to effectuate the acquisition,
transfer and conveyance of such Option Property in accordance with the terms of
this Agreement.

     3.3 Withholding. Optionor shall execute, upon the conveyance of an Option
Property, such certificates or affidavits reasonably necessary to document the
inapplicability of any federal or state tax withholding provisions, including,
without limitation, those referred to in Section 7.4 below. If Optionor fails
to provide such certificates or affidavits, USI may withhold a portion of the
Acquisition Consideration as required by the Internal Revenue Code of 1986, as
amended (the “Code”) or applicable state law.

     3.4 Taxes. If the transactions contemplated by this Agreement are
consummated, then the following shall apply:

          (a) Acquisition is Treated as Contribution. If the Acquisition
Consideration consists in part of Units, the transfer, assignment and exchange
contemplated by this Agreement shall constitute a “Capital Contribution” to USI
pursuant to Article IV of the Partnership Agreement and is intended to be
governed by Section 721(a) of the Code, and Optionor and USI shall report this
transaction consistent with such treatment.

          (b) Cooperation and Tax Disputes. Optionor, on the one hand, and USI, on
the other hand, shall provide each other with such cooperation and information
relating to an Option Property as the parties reasonably may request in (i)
filing any tax return, amended tax return or claim for tax refund, (ii)
determining any liability for taxes or a right to a tax refund, or (iii)
conducting or defending any proceeding in respect of taxes. Any time after the
date hereof, USI shall promptly notify Optionor in writing upon receipt by USI
or any of its affiliates of notice of (i) any pending or threatened tax audits
or assessments with respect to an Option Property, and (ii) any pending or
threatened federal, state, local or foreign tax audits or assessments of USI or
any of its affiliates, in each case which may affect the liabilities for taxes
of Optionor with respect to any tax period ending on or before the Closing
Date. Optionor shall promptly notify USI in writing upon receipt by Optionor
of notice of any pending or threatened federal, state, local or foreign tax
audits or assessments relating to the income, properties or operations of the
Optionor. USI, on the
one hand, and Optionor, on the other hand, may participate at its own
expense in the

 

 

prosecution of any claim or audit with respect to taxes
attributable to any taxable period ending on or before the Closing Date,
provided, that Optionor shall have the right to control the conduct of any such
audit or proceeding or portion thereof for which Optionor has acknowledged
liability for the payment of any additional tax liability, and USI shall have
the right to control any other audits and proceedings. Notwithstanding the
foregoing, neither USI, on the one hand, nor Optionor, on the other hand, may
settle or otherwise resolve any such claim, suit or proceeding which could have
an adverse tax effect on the other party or its direct or indirect owners
without the written consent of the other party, such written consent not to be
unreasonably withheld or delayed. USI and Optionor shall retain all tax
returns, schedules and work papers, and all material records and other
documents relating thereto, until the expiration of the statute of limitations
(and, to the extent notified by any party, any extensions thereof) of the
taxable years to which such tax returns and other documents relate and until
the final determination of any tax in respect of such years.

          (c) Tax Allocations. With respect to an Option Property that is directly
or indirectly contributed to USI as provided in Section 3.4(a) above, USI shall
use the “traditional method”, as described in Treasury Regulation Section
1.704-3(b), to make allocations of taxable income and loss among the partners
of USI.

          (d) Transfer Taxes. USI shall pay the cost of all documentary transfer
taxes or other transfer or recording taxes arising from the sale of an Option
Property pursuant to the exercise by USI of the Option.

          (e) Closing Costs. Any recording fees, escrow fees, and other closing
costs (except documentary transfer taxes as provided in Section 3.4(d) above)
shall be allocated according to custom and practice based on the location of an
Option Property.

          (f) Survivability. This Section 3.4 shall survive the termination of this
Agreement for a period of one year from the date of such termination.

ARTICLE IV – ADDITIONAL AGREEMENTS AND COVENANTS

     4.1 Sale of Property to Third Party. From the date hereof and continuing
until the expiration of the Option Term as described in Section 1.4, Optionor
shall not (i) affirmatively market any Option Property for sale, or (ii) sell,
convey or otherwise transfer, or agree to sell, convey or otherwise transfer,
all or any portion of an Option Property (other than the sale of an Option
Property pursuant to USI’s exercise of the Option or in accordance with Article
III hereof), without the prior written consent of USI, which consent may be
conditioned, withheld or delayed in USI’s sole and absolute discretion.

     4.2 Consent to Alternative Transaction. Optionor acknowledges and
understands that USI may desire to effectuate a transfer of an Option Property
other than through the direct acquisition of such Option Property as
contemplated hereby, and that USI may determine that it is more desirable or
appropriate to accomplish the transfer of such Option Property through one or
more alternative transactions, including, without limitation, the acquisition
of 100% of Optionor’s interest (“Optionor Interests”) in an entity created or
existing for the purpose of holding the right, title and interest in such
Option Property (an “Optionor Interest Acquisition”). Optionor hereby consents
to the Optionor

 

 

Interest Acquisition, and shall cooperate with USI to effect
and carry out any and all transactions deemed by USI to be necessary to
effectuate the Optionor Interest Acquisition or any other alternative
transaction pursuant to this Section 4.2(a); provided that, the Optionor
receives, in the aggregate, the amount of cash or number of Units to which
Optionor would have been entitled under Section 3.1 upon the sale of such
Option Property pursuant to this Agreement.

     4.3 Further Assurance. Optionor shall execute and deliver to USI all such
other and further instruments and documents and take or cause to be taken all
such other and further actions as USI may reasonably request in order to effect
the transactions contemplated by this Agreement, including, without limitation,
instruments or documents deemed necessary or desirable by USI to effect and
evidence the acquisition of an Option Property in accordance with the terms of
this Agreement.

     4.4 Consent to Other Approvals. Optionor hereby acknowledges and agrees
that the execution and delivery of this Agreement by Optionor shall constitute
the consent, waiver or approval by Optionor, pursuant to applicable law or
Optionor’s organizational documents or other agreements, to the transactions
contemplated hereby. For the avoidance of doubt, to the extent the consent,
waiver or approval of Optionor is required to effectuate any of the
transactions contemplated by this Agreement, Optionor shall be deemed to have
given such consent, waiver or approval pursuant hereto.

     4.5 Further Consents. From the date hereof and continuing until
expiration of the Option Term as described in Section 1.4, Optionor shall not
enter into any agreement or other undertaking with any person or entity or any
governmental authority, other than an agreement with, or undertaking to, a
governmental authority required in connection with the normal operation of an
Option Property and entered into in the ordinary course of Optionor’s business,
that would require the consent of any governmental or private party to effect
the transactions contemplated by this Agreement, including, without limitation,
the consent of any lender.

     4.6 Ownership of Optionor. Optionor and each of the Affiliated Persons
covenant and agree that from the date hereof and continuing until expiration of
the Option Term none of them will cause or permit Optionor to issue any equity
interests, or any owner of equity interest in Optionor to sell, assign or
otherwise dispose of any management right or any ownership interest in
Optionor, in each case without USI’s prior written consent.

ARTICLE V – REPRESENTATIONS, WARRANTIES AND COVENANTS

     As a material inducement to USI to enter into this Agreement, Optionor
hereby makes to USI each of the representations and warranties set forth in
this Article V, which representations and warranties are true and correct as of
the date hereof, and hereby covenants as follows:

     5.1 Organization; Authority. Optionor is duly formed, validly existing
and in good standing (to the extent applicable) under the laws of its
jurisdiction of formation. Optionor has full right, authority, power and
capacity: (a) to enter into this Agreement and each agreement, document and
instrument to be executed and delivered by or on behalf of
Optionor pursuant to this Agreement, and (b) to carry out the transactions
contemplated

 

 

hereby and thereby. This Agreement and each agreement, document
and instrument executed and delivered by or on behalf of Optionor pursuant to
this Agreement constitutes, or when executed and delivered will constitute, the
legal, valid and binding obligation of Optionor, each enforceable in accordance
with its respective terms. The execution, delivery and performance of this
Agreement and each such agreement, document and instrument by or on behalf of
Optionor: (i) does not and will not violate any foreign, federal, state, local
or other laws applicable to Optionor or require Optionor to obtain any
approval, consent or waiver of, or make any filing with, any person or
authority (governmental or otherwise) that has not been obtained or made prior
to the date hereof, and (ii) does not and will not violate any term, conditions
or provisions of, or constitute a default under, any bond, note or other
evidence of indebtedness or any contract, lease or other instrument to which
Optionor is a party or by which the property of Optionor is bound or affected.

     5.2 Title to the Option Property; No Agreements to Sell. Optionor owns
or will own at the Closing Date beneficially and of record, free and clear of
any claim, lien (including, without limitation, tax liens), option, charge,
security interest, mortgage, deed of trust, encumbrance, rights of assignment,
purchase rights or other rights of any nature whatsoever of any third party
(collectively, “Encumbrances”), and has or will have at the Closing Date full
power and authority to convey, free and clear of any Encumbrances, each Option
Property and, upon delivery of Optionor’s interests in an Option Property free
and clear of any Encumbrances, upon delivery of a deed of conveyance (and other
appropriate instruments of transfer) by the Optionor to USI relating to such
Option Property and receipt by it of the consideration for such Option Property
as herein provided, USI (or its designee) will acquire good and valid title
thereto, free and clear of any Encumbrance, in each case, except (i)
Encumbrances created in favor of USI by the transactions contemplated hereby,
(ii) Encumbrances that are extinguished at or prior to the Closing Date, (iii)
Encumbrances listed on Schedule 2 hereto, and (iv) the Assumed Liabilities (the
foregoing clauses (i) through (iv) collectively shall be known as the
“Permitted Encumbrances”). Other than this Agreement, Optionor is not
currently a party to any agreement to sell, transfer or otherwise encumber or
dispose of, and has no obligation (absolute or contingent) to sell, any Option
Property owned by Optionor. Optionor covenants not to encumber any Option
Property during the period from the date hereof and continuing until the
Expiration Date.

     5.3 Status as a United States Person. Optionor is not a foreign person
within the meaning of Section 1445 of the Internal Revenue Code (“Section
1445”). Optionor’s U.S. taxpayer identification number that has previously
been provided to USI is correct. Optionor’s office address is the address set
forth opposite its signature below. Upon request by USI, Optionor shall
complete and provide to USI a certificate of non-foreign status substantially
in the form provided in Section 1.1445-5(b)(3)(D) of the Treasury regulations.

     5.4 No Brokers. Optionor has not entered into, and covenants that it will
not enter into, any agreement, arrangement or understanding with any person or
firm which will result in the obligation of USI to pay any finder’s fee,
brokerage commission or similar payment in connection with the transactions
contemplated hereby.

     5.5 Assets. The Option Properties are the sole asset of Optionor, other
than cash or cash equivalents. Optionor covenants not to acquire any assets
other than

 

 

those to be made part of or used in connection with the Option
Properties, it being understood that any such additional assets so acquired
shall automatically become subject to this Agreement and the Option contained
herein. For the avoidance of doubt, nothing contained in this Section 5.5
shall prohibit Optionor from acquiring the eight Option Properties listed on
Exhibit A hereto as being under contract as of the date hereof.

     5.6 Litigation. There is no litigation or proceeding, either judicial or
administrative, pending or, to Optionor’s knowledge, threatened, affecting all
or any portion of any Option Property or the Optionor’s ability to consummate
the transactions contemplated hereby. There is no outstanding order, writ,
injunction or decree of any court, government, governmental entity or authority
or arbitration against or affecting all or any portion of any Option Property,
which in any such case would impair the Optionor’s ability to enter into and
perform all of the Optionor’s obligations under this Agreement.

     5.7 No Insolvency Proceedings. No attachments, execution proceedings,
assignments for the benefit of creditors, insolvency, bankruptcy,
reorganization or other proceedings are pending or, to Optionor’s knowledge,
threatened against the Optionor, nor are any such proceedings contemplated by
the Optionor.

     5.8 Securities Law Matters; Transfer Restrictions.

          (a) Optionor acknowledges that USI intends the offer and issuance of any
Units pursuant to this Agreement to be exempt from registration under the
Securities Act of 1933, as amended (the “Securities Act”) and applicable state
securities laws by virtue of (i) the status of the Optionor as an “accredited
investor” within the meaning of the federal securities laws, and (ii)
Regulation D promulgated under Section 4(2) of the Securities Act (“Regulation
D”), and that USI will rely in part upon the representations and warranties
made by the Optionor in this Agreement in making the determination that the
offer and issuance of the Units qualify for exemption under Rule 506 of
Regulation D as an offer and sale only to “accredited investors.”

          (b) Optionor is an “accredited investor” within the meaning of the federal
securities laws.

          (c) Optionor will acquire the Units for its own account and not with a
view to, or for sale in connection with, any “distribution” thereof within the
meaning of the Securities Act. Optionor does not intend or anticipate that the
Optionor will rely on this investment as a principal source of income.

          (d) Optionor has sufficient knowledge and experience in financial, tax and
business matters to enable him to evaluate the merits and risks of investment
in the Units. Optionor has the ability to bear the economic risk of acquiring
the Units. Optionor acknowledges that (i) the transactions contemplated by
this Agreement involve complex tax consequences for the Optionor, and the
Optionor is relying solely on the advice of the Optionor’s own tax advisors in
evaluating such consequences, (ii) USI has not made (nor shall it be deemed to
have made) any representations or warranties as to the tax consequences of such
transaction to the Optionor, and (iii) references in this Agreement to
the intended tax effect of the transactions contemplated hereby shall not
be deemed to imply any representation by USI as to a particular tax effect that
may be obtained by the

 

 

Optionor. The Optionor remains solely responsible for
all tax matters relating to the Optionor.

          (e) Optionor has been supplied with, or had access to, information to
which a reasonable investor would attach significance in making an investment
decision to acquire the Units and any other information the Optionor has
requested. The Optionor has had an opportunity to ask questions of, and
receive information and answers from, USI and is affiliates concerning USI, its
affiliates, the Units, the other IPO Transactions and the Common Shares into
which the Units may be redeemed, and to assess and evaluate any information
supplied to the Optionor by USI or its affiliates, and all such questions have
been answered, and all such information has been provided to the full
satisfaction of the Optionor.

          (f) Optionor acknowledges that it is aware that there are substantial
restrictions on the transferability of the Units and that the Units will not be
registered under the Securities Act or any state securities laws, and the
Optionor has no right to require that they be so registered. Optionor agrees
that any Units it acquires will not be sold in the absence of registration
unless such sale is exempt from registration under the Securities Act and
applicable state securities laws. Optionor acknowledges that the Optionor
shall be responsible for compliance with all conditions on transfer imposed by
any securities authority and for any expenses incurred by USI for legal or
accounting services in connection with reviewing such a proposed transfer or
issuing opinions in connection therewith.

          (g) Optionor understands that no federal agency (including the Securities
and Exchange Commission) or state agency has made or will make any finding or
determination as to the fairness of an investment in the Units.

          (h) Optionor understands that there is no established public, private or
other market for the Units acquired by the Optionor hereunder and it is not
anticipated that there will be any public, private or other market for such
Units in the foreseeable future.

          (i) Optionor understands that Rule 144 promulgated under the Securities
Act is not currently available with respect to the sale of Units.

          5.9 Reliance. Optionor acknowledges that it understands the meaning and
legal consequences of the representations and warranties in this Article V, and
that USI may rely upon such representations and warranties in determining
whether to enter into this Agreement.

ARTICLE VI: CONDITIONS TO CLOSING

     6.1 Conditions to USI’s Obligation to Close. The obligation of USI to
consummate any Closing is subject to the fulfillment, at or prior to the
Closing Date, of the following conditions (unless such conditions are waived in
writing by USI):

 

 

          (a) Representations and Warranties. The representations and warranties
made by Optionor pursuant to this Agreement (as they relate to the Option
Property subject to the Closing) shall be true and correct in all material
respects when made, and on and as of the Closing Date, as though such
representations and warranties were made on the Closing Date.

          (b) Performance. Optionor shall have performed and complied with all
agreements and covenants (as they relate to the Option Property subject to the
Closing) that the Optionor is required to perform or comply with pursuant to
this Agreement prior to the Closing in all material respects.

          (c) Legal Proceedings. No action or proceeding by or before any
governmental authority (as they relate to the Option Property subject to the
Closing) shall have been instituted that is reasonably expected to restrain,
prohibit or invalidate the transactions contemplated by this Agreement, other
than an action or proceeding instituted by Optionor.

          (d) Consents and Approvals. All necessary consents of governmental and
private parties (as they relate to the Option Property subject to the Closing)
to effect the transactions contemplated by this Agreement, including, without
limitation, consents of lenders, shall have been obtained.

          (e) Reliance on Regulation D. If Units are to be issued as part of the
consideration to be paid for an Option Property, USI shall, based on advice of
its counsel, be reasonably satisfied that there shall not be more than 35
“purchasers of securities” (as calculated pursuant to Rule 501 of Regulation D)
at the Closing Date and that such issuance and the contemplated distribution of
Units to Optionor may be made without registration under the Securities Act in
reliance upon Regulation D.

     6.2 Conditions to the Optionor’s Obligation to Close. The obligation of
the Optionor to consummate any Closing is subject to the fulfillment, at or
prior to the Closing Date, of the following conditions (unless such conditions
are waived in writing by Optionor):

          (a) Performance. USI shall have performed and complied with all
agreements and covenants (as they relate to the Option Property subject to the
Closing) that it is required to perform or comply with pursuant to this
Agreement prior to the Closing Date in all material respects.

          (b) Legal Proceedings. No action or proceeding by or before any
governmental authority (as they relate to the Option Property subject to the
Closing) shall have been instituted that is reasonably expected to restrain,
prohibit or invalidate the transactions contemplated by this Agreement, other
than an action or proceeding instituted by USI; provided, that the foregoing
condition shall be deemed to have been satisfied if USI shall have agreed to
fully indemnify Optionor from any loss, liability, claim, damage or expense
arising out of the Optionor’s proceeding to close under this Agreement in the
face of any such action or proceeding.

          (c) Consents and Approvals. All necessary consents of governmental
authorities, if any, (as they relate to the Option Property subject to the

 

 

Closing) to effect the transactions contemplated by this Agreement shall
have been obtained; provided, that the foregoing condition shall be deemed to
have been satisfied if USI shall have agreed to fully indemnify Optionor from
any loss, liability, claim, damage or expense arising out of Optionor’s
proceeding to close under this Agreement without having obtained a necessary
consent.

          (d) Registration Rights Agreement. At or prior to the Closing Date, the
REIT shall have entered into a registration rights agreement with Optionor
providing Optionor with registration rights that either, at the REIT’s option,
(i) register the issuance of the Common Shares received upon redemption of any
Units issued in connection with such Closing, or (ii) register the resale of
the Common Shares issuable upon redemption of any Units issued in connection
with such Closing, such registration rights agreement to contain such other
terms and conditions customary for a transaction of this type (the
“Registration Rights Agreement”).

ARTICLE VII: CLOSING

     7.1 Closing. The Closing Date with respect to an Option Property shall
occur as set forth in Section 2.1, which date USI shall designate in writing to
Optionor at least five business day prior to such date. The Closing with
respect to such Option Property shall take place at such time and place on such
Closing Date as shall be designated by USI.

     7.2 Closing Deliveries by Optionor. At the Closing with respect to an
Option Property, Optionor shall execute and deliver to USI the following:

          (i) a duly executed deed of conveyance with respect to such Option
Property, substantially in the form attached hereto as Exhibit C, modified as
necessary to conform to local requirements, pursuant to which Optionor shall
grant and convey to USI (or its designee) the Optionor’s right, title and
interests in the Land and Improvements with respect to such Option Property,
free and clear of Encumbrances, other than Permitted Encumbrances;

          (ii) a duly executed Bill of Sale and Assignment and Assumption Agreement
with respect to such Option Property, substantially in the form attached hereto
as Exhibit D(“Assignment Agreement”), pursuant to which (a) the Optionor shall
assign and convey to USI (or its designee) the Optionor’s right, title and
interests in (i) the Personal Property, the Leases and the Other Contracts with
respect to such Option Property, free and clear of Encumbrances, other than the
Permitted Encumbrances, and (b) USI shall assume the Assumed Liabilities with
respect to such Option Property;

          (iii) a Limited Partner Acceptance if a portion of the Acquisition
Consideration for such Option Property consists of Units, substantially in the
form attached hereto as Exhibit E, duly executed by Optionor;

          (iv) such documents and certificates as USI may reasonably request (x) to
establish the authority of the parties executing any documents in connection
with the Closing, (y) to reflect the parties’ intentions regarding the transfer
of such Option Property and assumption of the Assumed Liabilities with respect
to such Option Property,

 

 

or (z) as may be reasonably required by Optionor’s title insurer in
connection with the issuance of a title insurance policy for such Option
Property; and

          (v) a non-foreign seller certification, substantially in the form attached
hereto as Exhibit F, executed by the Optionor.

     7.3 Closing Deliveries by USI. At the Closing with respect to an Option
Property, USI shall execute and deliver to Optionor the following:

          (i) a duly executed Assignment Agreement; and

          (ii) a duly executed Registration Rights Agreement.

ARTICLE VIII – TERMINATION

     8.1 Termination of this Agreement. This Agreement shall terminate and be
of no further force or effect upon the earlier to occur of:

          (a) the acquisition by USI of all right, title and interest of Optionor in
all of the Option Properties in accordance with this Agreement; and

          (b) the expiration of the Option pursuant to Section 1.4 hereof;

     8.2 Procedure if Option Terminates.

          (a) Verification of Termination. If this Agreement is terminated pursuant
to Section 8.1(b), USI shall execute, acknowledge and deliver to Optionor in
recordable form with appropriate authorization for recording, within 10 days
from request therefore, a deed of conveyance or any other document reasonably
requested by Optionor or a title insurance company to verify the termination of
this Agreement, including, without limitation, the Option, with respect to any
Option Property not conveyed to USI pursuant hereto.

          (c) Right to Documents. If this Agreement is terminated pursuant to
Section 8.1(b), USI shall forthwith deliver (or cause to be delivered) to
Optionor and shall be deemed to have assigned to Optionor (without the
execution of further documentation or instruments), any governmental
applications, permits, maps, plans, specifications and other documents in its
possession or that it has made, with respect to any Option Property not
conveyed to USI pursuant hereto, including, without limitation, all engineering
reports, surveys, soil tests, seismic studies, environmental reports, grading,
flood control and drainage plans, design renderings, market analyses,
feasibility studies, proposed tentative, parcel and final maps, and all
correspondence with governmental agencies and their personnel concerning the
same (other than materials in USI’s or any subsidiary’s or affiliated company’s
possessions or pursuant to any continuing agreement between USI, on the one
hand, and Optionor, on the other hand).

     8.3 Effects of Termination. In the event of termination of this Agreement
pursuant to Section 8.1, the provisions of Sections 1.5, 8.2, 8.3 and Article
XI shall survive the termination of this Agreement, and Sections 3.3 and 3.4
and Article IX shall survive the

 

 

termination of this Agreement only with respect to any Option Property
that has been acquired by USI pursuant to the terms herein. Notwithstanding
the foregoing, nothing in this Section 8.3 shall be deemed to release any party
from liability for any breach by such party of the terms or provisions of this
Agreement or to impair the right of any party to enforce its respective rights
hereunder.

ARTICLE IX – INDEMNIFICATION

     Optionor shall indemnify USI, its affiliates and its respective trustees,
directors, officers, members, partners, employees, agents, successors and
assigns (the “Indemnitees”) in respect of, and hold the Indemnitees harmless
against, any and all liabilities (whether absolute or contingent, known or
unknown or accrued or unaccrued), damages, judgments, fines, fees, penalties,
obligations, deficiencies, losses and expenses (including, without limitation,
reasonable fees and expenses of attorneys and accountants and including,
without limitation, amounts paid in settlement) (“Damages”) actually incurred
or suffered by any Indemnitee, and to reimburse each Indemnitee for such
Damages which are suffered or incurred by such Indemnitee or to which such
Indemnitee may otherwise become subject, arising out of or resulting from the
untruth, inaccuracy or breach of any representation or warrant of Optionor
contained in this Agreement, or any breach, non-fulfillment or failure to
perform any agreement or covenant of Optionor contained in this Agreement.

ARTICLE X – ASSIGNMENT

     10.1 USI’s Right to Assignment. USI may not assign the Option without
Optionor’s prior written consent, which consent may be conditioned, withheld or
delayed in Optionor’s sole and absolute discretion; provided, that USI may
assign the Option without Optionor’s consent to (i) the REIT, (ii) any direct
or indirect controlled affiliate of the REIT or USI, or (iii) any entity into
which USI has merged or otherwise is the result of a business combination
directly involving USI.

     10.2 Optionor’s Right to Assignment. Optionor may not assign its
interests in this Agreement, in whole or in part, without USI’s prior written
consent, which consent may be conditioned, withheld or delayed in USI’s sole
and absolute discretion.

ARTICLE XI – MISCELLANEOUS

     11.1 Amendment; Waiver. This Agreement may not be amended except by an
instrument in writing signed by the parties. No waiver of any provisions of
this Agreement shall be valid unless in writing and signed by the party against
whom enforcement is sought.

     11.2 Entire Agreement; Counterparts; Applicable Law. This Agreement (a)
constitutes the entire agreement and supersedes all prior agreements and
understandings, both written and oral, between the parties with respect to the
subject matter hereof, (b) may be executed in one or more counterparts, each of
which will be deemed an original and all of which, including, without
limitation, validity, interpretation and effect, shall constitute but one and
the same instrument, and (c) shall be governed in

 

 

all respects, including, without limitation, validity, interpretation and
effect, by the laws of the State of Ohio without giving effect to the conflict
of law provisions thereof.

     11.3 Severability. If any provision of this Agreement, or the application
thereof, is for any reason held to any extent to be invalid or unenforceable,
the remainder of this Agreement and application of such provision to other
persons or circumstances will be interpreted so as reasonably to effect the
intent of the parties hereto. The parties shall replace such void or
unenforceable provision of this Agreement with a valid and enforceable
provision that will achieve, to the extent possible, the economic, business and
other purposes of the void or unenforceable provision and execute any
amendment, consent or agreement deemed necessary or desirable by USI to effect
such replacement.

     11.4 Binding Effect. This Agreement shall be binding upon, and shall be
enforceable by and inure to the benefit of, the parties and their respective
permitted successors and permitted assigns.

     11.5 Equitable Remedies. The parties hereto agree that irreparable damage
would occur if any provision of this Agreement was not performed in accordance
with its specific terms or was otherwise breached. It is accordingly agreed
that the parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any federal or state court located in the State of Ohio (as to which
the parties agree to submit to jurisdiction for the purposes of such action),
this being in addition to any other remedy to which they are entitled at law or
in equity.

     11.6 Notices. Any notice or demand which must or may be given under this
Agreement (including, without limitation, the Exercise Notice) or by law shall,
except as otherwise provided, be in writing and shall be deemed to have been
delivered (i) when physically received by personal delivery (which shall
include the confirmed receipt of a telecopied facsimile transmission), or (ii)
three business days after being deposited in the United States certified or
registered mail, return receipt requested, postage prepaid or (iii) one
business day after being deposited with a nationally known commercial courier
service providing next day delivery service (such as Federal Express).

     11.7 Recording. Upon request of USI, Optionor agrees to record a
memorandum of this Agreement in the real property records of each county in
which any portion of an Option Property is situated. If Optionor records such
a memorandum, USI covenants to record the appropriate notice of termination or
cancellation upon the expiration or earlier termination of this Agreement.

     11.8 Fees and Expenses. Except to the extent contemplated in Section
3.4(d), Section 3.4(e) or Article IX hereof, all fees and expenses incurred in
connection with the execution, delivery and performance of this Agreement and
the transactions contemplated hereby shall be paid by the party incurring such
fees and expenses. In connection with any litigation or a court proceeding
arising out of this Agreement, the prevailing party shall be entitled to
recover all costs incurred, including reasonable attorneys’ fees and legal
assistants’ fees and costs whether incurred prior to trial, at trial, or on
appeal.

 

 

     11.9 Reliance. Each party to this Agreement acknowledges and agrees that
it is not relying on tax advice or other advice from the other party to this
Agreement, and that it has or will consult with its own advisors.

[Signature page follows]

 

 

     IN WITNESS WHEREOF, each of the parties hereto has executed and delivered
this Agreement as of the date first set forth above.

	 	 	 
	Address:
	 	 
	 
	 	 
	Rising Tide Development, LLC

6745 Engle Road, Suite 300

Middleburg, OH 44130

	 	OPTIONOR:

RISING TIDE DEVELOPMENT, LLC

By: Mizzen, LLC, it Sole Member

By: Amsdell Holdings X, Inc., its Manager

	 	 	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 Robert J. Amsdell	 
	 	 	Title:  	President 	 

	 	 	 
	U-Store It, L.P.

c/o U-Store-It Trust 

6745 Engle Road, Suite 300

Middleburg, OH 44130

	 	USI:

U-STORE-IT, L.P.

By: U-STORE-IT TRUST, its General Partner

	 	 	 	 	 
	 	By:  	
 	 
	 	 	Name:  	 Steven G. Osgood 	 
	 	 	Title:  	President 	 

	 	 	 
	Robert J. Amsdell

c/o U-Store-It Trust

6745 Engle Road, Suite 300

Middleburg, OH 44130

	 	Executed and agreed upon solely for
purposes of Section 1.6 and 4.6 hereof:
	

	 	
 
	

	 	Robert J. Amsdell
	 
	 	 
	Barry L. Amsdell

c/o U-Store-It Trust

6745 Engle Road, Suite 300

Middleburg, OH 44130
	 	 
	

	 	
 
	

	 	Barry L. AmsdellEX-10.12

 

Exhibit 10.12

REGISTRATION RIGHTS AGREEMENT

          THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”) is made and entered
into as of October    , 2004 by and among U-Store-It Trust, a Maryland real
estate investment trust (the “Company”), Robert J. Amsdell, Barry L. Amsdell,
Todd C. Amsdell, the Robert J. Amsdell Family Irrevocable Trust dated June 4,
1998, the Loretta Amsdell Family Irrevocable Trust dated June 4, 1998, Amsdell
Holdings I, Inc., an Ohio corporation (“Holdings”), Amsdell and Amsdell, an
Ohio general partnership (the “Lakewood Contributor”), and Robert J. Amsdell,
Trustee (the “Lantana Contributor”).

          WHEREAS, the Company and U-Store-It, L.P. (f/k/a Acquiport/Amsdell I
Limited Partnership), a Delaware limited partnership, of which the Company is
the general partner (“USI”), are engaging in various related transactions
pursuant to which, among other things, (i) the Company will consummate certain
merger and reorganization transactions with entities affiliated with the
Company, (ii) USI will acquire various real estate properties in which certain
persons affiliated with the Company have interests, and (iii) the Company will
effect an initial public offering of its common shares and contribute the
proceeds therefrom for units of partnership interest in USI (the “U-Store-It
IPO,” and together with the other transactions described above, the “U-Store-It
IPO Transactions”);

          WHEREAS, as part of the U-Store-It IPO Transactions, the Company entered
into a Merger Agreement dated as of July 30, 2004 (the “Amsdell Merger
Agreement”), with Amsdell Partners, Inc., an Ohio corporation (“Amsdell
Partners”), pursuant to which Amsdell Partners merged with and into the
Company, with the Company being the surviving entity, and the common stock of
Amsdell Partners was converted into common shares of beneficial interest, par
value $0.01 per share, of the Company (“REIT Common Shares”), in accordance
with the terms of the Amsdell Merger Agreement;

          WHEREAS, pursuant to the Amsdell Merger Agreement, each of Robert J.
Amsdell and Barry L. Amsdell, the sole shareholders of Amsdell Partners (each
an “Amsdell Partners Shareholder” and collectively together with their
respective successors and assignees permitted under Section 6.3 hereof, the
“Amsdell Partners Shareholders”), received the number of REIT Common Shares in
exchange for their shares of common stock of Amsdell Partners (the “Amsdell
Partners Exchange Shares”) as set forth on Schedule A;

          WHEREAS, also as part of the U-Store-It IPO Transactions, the Company
entered into a Merger Agreement dated as of July 30, 2004 (the “High Tide
Merger Agreement”), with High Tide LLC, an Ohio limited liability company
(“High Tide”), pursuant to which High Tide merged with and into the Company,
with the Company being the surviving entity, and the membership interests of
High Tide were converted into REIT Common Shares in accordance with the terms
of the High Tide Merger Agreement;

          WHEREAS, pursuant to the High Tide Merger Agreement, each of Robert J.
Amsdell, Barry L. Amsdell, Todd C. Amsdell, the Robert J. Amsdell Family
Irrevocable Trust dated June 4, 1998 and the Loretta Amsdell Irrevocable Trust
dated June 4, 1998, the members of High Tide (each a “High Tide Member” and
collectively together with their respective successors and assignees permitted
under Section 6.3 hereof, the “High Tide Members”; the High Tide Members and
the Amsdell Partners Shareholders are collectively

 

 

referred to herein as the “Shareholders”), received the number of REIT
Common Shares in exchange for their membership interests in High Tide (the
“High Tide Exchange Shares”) as set forth on Schedule A;

          WHEREAS, also as part of the U-Store-It IPO Transactions, USI entered into
a Partnership Reorganization Agreement dated as of July 30, 2004 (the
“Reorganization Agreement”), with Holdings, Amsdell Partners and High Tide,
pursuant to which USI issued the number of Class A units of limited partnership
interest in USI (the “Units”) to Holdings set forth on Schedule A hereto;

          WHEREAS, pursuant to the terms of Section 8.6 and other related provisions
of the Second Amended and Restated Agreement of Limited Partnership of
U-Store-It, L.P. (such agreement, as amended from time to time, the
“Partnership Agreement”), commencing one year after the date of issuance, and
subject to the various limitations contained in the Partnership Agreement and
other instruments being delivered in connection with the U-Store-It IPO
Transactions, Holdings (together with its respective successors and assigns
permitted under Section 6.3 hereof) is entitled to redeem its Units for cash
or, at the option of USI, REIT Common Shares;

          WHEREAS, also as part of the U-Store-It IPO Transactions, USI entered into
(i) a Contribution Agreement dated as of July 30, 2004 (the “Vero Contribution
Agreement”), with Holdings, (ii) a Contribution Agreement dated as of July 30,
2004 (the “Lakewood Contribution Agreement”), with the Lakewood Contributor,
and (iii) a Contribution Agreement dated as of July 30, 2004 (the “Lantana
Contribution Agreement”), with the Lantana Contributor, pursuant to which
Holdings, the Lakewood Contributor and the Lantana Contributor (each a
“Contributor” and collectively, together with their respective successors and
assigns permitted under Section 6.3 hereof, the “Contributors”) each
transferred its interest in a separate real estate property to USI, USI assumed
certain obligations related to each such separate property and USI issued the
number of Units to each Contributor as set forth on Schedule A hereto;

          WHEREAS, pursuant to the terms of Section 8.6 and other related provisions
of the Partnership Agreement, commencing one year after the date of issuance,
and subject to the various limitations contained in the Partnership Agreement
and other instruments being delivered in connection with the U-Store-It IPO
Transactions, each Contributor is entitled to redeem its Units for cash or, at
the option of USI, REIT Common Shares; and

          WHEREAS, the Company has agreed to grant to the Shareholders the Exchange
Share Registration Rights (as defined in Section 1.2 hereof), and to grant to
the Contributors the Redemption Share Registration Rights (as defined in
Section 1.1 hereof).

          NOW, THEREFORE, the parties hereto, in consideration of the foregoing, the
mutual covenants and agreements hereinafter set forth, and other good and
valuable consideration, the receipt and sufficiency of which are acknowledged,
hereby agree as follows:

 

 

SECTION 1. REGISTRATION RIGHTS

          1.1 Redemption Share Registration Rights. Subject to the various terms
and conditions of the Partnership Agreement and the limitations upon the
redemption of the Units set forth in other instruments being delivered in
connection with the U-Store-It IPO Transactions, if any Contributor receives
REIT Common Shares upon redemption of Units held by such Contributor
(“Redemption Shares”), then each Contributor shall be entitled to offer the
Redemption Shares for resale pursuant to a shelf registration statement,
subject to the terms and conditions set forth in Section 2 hereof (the
“Redemption Share Registration Rights”).

          1.2 Exchange Share Registration Rights. Subject to the limitations upon
the ability of the Shareholders to sell the Exchange Shares set forth in other
instruments being delivered in connection with the U-Store-It IPO Transactions,
each Shareholder shall be entitled to offer the Exchange Shares for resale
pursuant to a shelf registration statement, subject to the terms and conditions
set forth in Section 2 hereof (the “Exchange Share Registration Rights”).

SECTION 2. DEMAND REGISTRATION RIGHTS

          2.1 (a) Redemption Share Registration Procedure. Subject to Section
2.1(f) and Section 2.2 hereof, each Contributor may deliver to the Company, at
any time after the date the Company becomes eligible to use Form S-3 (or any
similar or successor short form registration statement), a written notice (a
“Registration Notice”) informing the Company of such Unit Holder’s desire to
have the Redemption Shares underlying such Unit Holder’s Units registered for
resale. Upon receipt of the Registration Notice, if the Company has not
already caused the Redemption Shares to be included as part of an existing
shelf registration statement and related prospectus that the Company then has
on file with, and which has been declared effective by, the Securities and
Exchange Commission (the “Commission”) and which remains in effect and not
subject to any stop order, injunction or other order or requirement of the
Commission (the “Shelf Registration Statement”) (in which event the Company
shall be deemed to have satisfied its registration obligation under this
Section 2 with respect to the Redemption Shares), then the Company shall cause
to be filed with the Commission as soon as reasonably practicable after
receiving the Registration Notice, but in no event more than 60 days following
receipt of such notice, a new registration statement and related prospectus
(the “New Registration Statement”) that complies as to form in all material
respects with applicable Commission rules providing for the resale by such
Contributor of the Redemption Shares owned by such Unit Holder, and agrees
(subject to Section 2.2 hereof) to use commercially reasonable efforts to cause
the New Registration Statement to be declared effective by the Commission as
soon as practicable.

          (b) Exchange Share Registration Procedure. Subject to Section 2.1(f) and
Section 2.2 hereof, each Shareholder may deliver to the Company, at any time
after the date the Company becomes eligible to use Form S-3 (or any similar or
successor short form registration statement), a Registration Notice informing
the Company of such Shareholder’s desire to have the Exchange Shares registered
for resale. Upon receipt of the Registration
Notice, if the Company has not already caused the Exchange Shares to be
included as part

 

 

of an existing Shelf Registration Statement (in which event
the Company shall be deemed to have satisfied its registration obligation under
this Section 2 with respect to the Exchange Shares), then the Company will
cause to be filed with the Commission as soon as reasonably practicable after
receiving the Registration Notice, but in no event more than 60 days following
receipt of such notice, a New Registration Statement that complies as to form
in all material respects with applicable Commission rules providing for the
resale by such Shareholder of the Exchange Shares owned by such Shareholder,
and agrees (subject to Section 2.2 hereof) to use commercially reasonable
efforts to cause the New Registration Statement to be declared effective by the
Commission as soon as practicable. As used in this Agreement, (i)
“Registration Statement” and “Prospectus” refer to a Shelf Registration
Statement and related prospectus (including any preliminary prospectus) or a
New Registration Statement and related prospectus (including any preliminary
prospectus), whichever is utilized by the Company to satisfy a Unit Holder’s or
Shareholder’s Redemption Share Registration Rights and/or Exchange Share
Registration Rights, as the case may be, pursuant to this Section 2, including,
in each case, any documents incorporated therein by reference, (ii)
“Registrable Securities” refer to the Redemption Shares and/or Exchange Shares
to which a Contributor or Shareholder, as the case may be, is entitled to
registration rights under this Section 2, and (iii) “Holders” refers to the
Contributors and/or the Shareholders, as the case may be.

          (c) Subject to Section 2.2 hereof, the Company agrees to use commercially
reasonable efforts to keep the Registration Statement continuously effective
(including the preparation and filing of any amendments and supplements
necessary for that purpose) until the earlier of (i) the date on which all of
the Registrable Securities covered by such Registration Statement and held by
the Holders thereof are eligible for immediate sale pursuant to Rule 144(k) (or
any successor provision) or in a single transaction under Rule 144(e) (or any
successor provision) under the Securities Act of 1933, as amended (the
“Securities Act”), or (ii) the date on which the Holders consummate the sale of
all of the Registrable Securities. Notwithstanding the foregoing, the Company
may at any time, in its sole discretion and prior to receiving a Registration
Notice from any Holder include all of any Holder’s Registrable Securities or
any portion thereof in any Registration Statement (in which event the Company
shall be deemed to have satisfied its registration obligation under this
Section 2.1, with respect to the Registrable Securities so included, so long as
such Registration Statement remains effective and not the subject of any stop
order, injunction or other order of the Commission).

          (d) Notice to Holders. Upon receipt of the Registration Notice as set
forth above, the Company shall promptly give written notice of such receipt to
all other Holders, and such notice shall offer all of the Holders the
opportunity to include in the New Registration Statement such number of
Redemption Shares or Exchange Shares, as the case may be, as each such Holder
may request.

          (e) Offers and Sales. All offers and sales of Registrable Securities
covered by a Registration Statement by the Holder thereof shall be completed
within the period during which such Registration Statement remains effective
and not the subject of any stop order, injunction or other order of the
Commission. Upon notice that such Registration Statement is no longer
effective no Holder will offer or sell the Registrable Securities covered by
such
Registration Statement. If directed in writing by the Company, each
Holder will return all

 

 

undistributed copies of the related Prospectus in such
Holder’s possession upon the expiration of such period.

          (f) Limitations on Registration Rights. For purposes of this Agreement,
the Holders (including all successors and assigns), in the aggregate and as a
group, shall be limited to a total of not more than three exercises of the
Redemption Share Registration Rights and/or the Exchange Share Registration
Rights in any twelve month period. Notwithstanding the foregoing, if a
Registration Statement has not been declared effective by the Commission within
120 days after the original filing date or is suspended for more than 60 days
at any one time, the Holders shall not be deemed to have exercised its
Redemption Share Registration Rights and/or Exchange Share Registration Rights
under each of Section 2.1(a) and/or Section 2.1(b), as the case may be.
Notwithstanding anything to the contrary, no Holder shall be entitled to
exercise the Redemption Share Registration Rights or the Exchange Share
Registration Rights (as applicable) if all of the Registrable Securities held
by such Holder (or issuable upon redemption of the Units held by such Holder)
are eligible for immediate sale pursuant to Rule 144(k) (or any successor
provision) or in a single transaction pursuant to Rule 144(e) (or any successor
provision) under the Securities Act. The Redemption Share Registration Rights
and Exchange Share Registration Rights granted pursuant to this Section 2 may
not be exercised in connection with any underwritten public offering by the
REIT.

          (g) Market Stand-Off Agreement. Each Holder hereby agrees that it shall
not, to the extent requested by the Company or an underwriter of securities of
the Company, directly or indirectly sell, offer to sell (including without
limitation any short sale), grant any option or otherwise transfer or dispose
of any Registrable Securities (other than to donees or affiliates of the Holder
who agree to be similarly bound) within seven days prior to and for up to 90
days following the effective date of a registration statement of the Company
filed under the Securities Act or the date of an underwriting agreement with
respect to an underwritten public offering of the Company’s securities (the
“Stand-Off Period”); provided, however, that:

          (i) with respect to the Stand-Off Period, such agreement shall not be
applicable to the Registrable Securities to be sold on the Holder’s behalf to
the public in an underwritten offering pursuant to such registration statement;

          (ii) all executive officers and trustees of the Company then holding REIT
Common Shares shall enter into similar agreements;

          (iii) the Company shall use commercially reasonable efforts to obtain
similar agreements from each 5% or greater shareholder of the Company;
and
(iv) the Holders shall be allowed any concession or proportionate release
allowed to any officer, director or other 5% or greater shareholder of the
Company that entered into similar agreements.

     In order to enforce the foregoing covenant, the Company shall have the
right to place restrictive legends on the certificates representing the
Registrable Securities subject to this
Section 2.1(g) and to impose stop transfer instructions with respect to the
Registrable Securities and such other REIT Common Shares of each Holder (and
the REIT Common

 

 

Shares or securities of every other person subject to the
foregoing restriction) until the end of such period.

          2.2 Suspension of Offering. Notwithstanding Section 2.1(a) and Section
2.1(b) hereof, the Company shall be entitled to postpone the filing of a
Registration Statement, and from time to time to require Holders not to sell
under such Registration Statement or to suspend the effectiveness thereof if
(i) the Company is actively pursuing an underwritten primary offering of equity
securities, or (ii) the negotiation or consummation of a transaction by the
Company or its subsidiaries is pending or an event has occurred, which
negotiation, consummation or event would require additional disclosure by the
Company in the Registration Statement of material information which the Company
has a bona fide business purpose for keeping confidential and the
non-disclosure of which in the Registration Statement would be expected, in the
Company’s reasonable determination, to cause the Registration Statement to fail
to comply with applicable disclosure requirements (each such circumstance a
“Suspension Event”), provided, however, that the Company may not delay, suspend
or withdraw such Registration Statement for more than 60 days at any one time,
or more than twice in any 12 month period. Upon receipt of any written notice
from the Company (a) of the happening of any Suspension Event during the period
a Registration Statement is effective or (b) that as a result of a Suspension
Event a Registration Statement or related Prospectus contains any untrue
statement of a material fact or omits to state any material fact required to be
stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made (in the case of the Prospectus) not
misleading, each Holder agrees that (i) it will immediately discontinue offers
and sales of the Registrable Securities under such Registration Statement until
the Holder receives copies of a supplemental or amended Prospectus (which the
Company agrees to promptly prepare) that corrects the misstatement(s) or
omission(s) referred to above and receives notice that any post-effective
amendment has become effective or unless otherwise notified by the Company that
it may resume such offers and sales, and (ii) it will maintain the
confidentiality of any information included in the written notice delivered by
the Company unless otherwise required by law or subpoena. If so directed by
the Company, Holders will deliver to the Company all copies of the Prospectus
covering the Registrable Securities current at the time of receipt of such
notice.

          2.3 Qualification. The Company shall file such documents as necessary to
register or qualify the Registrable Securities to be covered by a Registration
Statement by the time such Registration Statement is declared effective by the
Commission under all applicable state securities or “blue sky” laws of such
jurisdictions as any Holder may reasonably request in writing, and shall use
commercially reasonable efforts to keep each such registration or qualification
effective during the period such Registration Statement is required to be kept
effective pursuant to this Agreement or during the period offers or sales are
being made by the Holders of Registrable Securities covered by such
Registration Statement after delivery of a Registration Notice to the Company,
whichever is shorter, and to do any and all other similar acts and things which
may be reasonably necessary or advisable to enable the Holders to consummate
the disposition of such Registrable Securities in each such jurisdiction;
provided, however, that the Company shall not be required to (i) qualify
generally to do business in any jurisdiction or to register as a broker
or dealer in such jurisdiction where it would not otherwise be required to
qualify but for this Agreement, (ii) take any action that would cause it to
become subject to any taxation in any jurisdiction where it would not otherwise
be subject to such taxation or (iii) take any action

 

 

that would subject it to
the general service of process in any jurisdiction where it is not then so
subject.

          2.4 Obligations of the Company. When the Company is required to effect
the registration of Registrable Securities under the Securities Act pursuant to
Section 2.1 of this Agreement, subject to Section 2.2 hereof, the Company
shall:

          (a) prepare and file with the Commission such amendments and supplements
to the Registration Statement and the Prospectus used in connection therewith
as may be necessary (i) to keep such Registration Statement effective and (ii)
to comply with the provisions of the Securities Act with respect to the
disposition of the Registrable Securities covered by such Registration
Statement, in each case for such time as is contemplated in Section 2.1(a) or
Section 2.1(b) (as the case may be) above;

          (b) furnish, without charge, to the Holders such number of copies of the
Registration Statement, each amendment and supplement thereto (in each case
including all exhibits), and the Prospectus included in such Registration
Statement (including each preliminary Prospectus) in conformity with the
requirements of the Securities Act as the Holders may reasonably request in
order to facilitate the public sale or other disposition of the Registrable
Securities covered by such Registration Statement owned by the Holders;

          (c) promptly notify the Holders: (i) when the Registration Statement, any
pre-effective amendment, the Prospectus or any prospectus supplement related
thereto or post-effective amendment to the Registration Statement has been
filed, and, with respect to the Registration Statement or any post-effective
amendment, when the same has become effective, (ii) of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation or threat of any proceedings for that purpose, and
(iii) of the receipt by the Company of any notification with respect to the
suspension of the qualification of any Registrable Securities for sale under
the securities or “blue sky” laws of any jurisdiction or the initiation of any
proceeding for such purpose;

          (d) promptly use commercially reasonable efforts to prevent the issuance
of any order suspending the effectiveness of a Registration Statement, and, if
any such order suspending the effectiveness of a Registration Statement is
issued, shall promptly use commercially reasonable efforts to obtain the
withdrawal of such order at the earliest possible moment;

          (e) if the Registrable Securities are of a class of securities that is
listed on a national securities exchange, file copies of any Prospectus with
such exchange in compliance with Rule 153 under the Securities Act so that the
Holders shall benefit from the prospectus delivery procedures described
therein;

          (f) following receipt of a Registration Notice and thereafter until the
sooner of completion, abandonment or termination of the offering or sale
contemplated thereby and the expiration of the period during which the Company
is required to maintain the
effectiveness of the related Registration Statement as set forth in
Section 2.1(a) or Section 2.1(b) (as the case may be) above, promptly notify
the Holders: (i) of the existence of any fact of which the Company is aware or
the happening of any event which has resulted in (A) the Registration
Statement, as then in effect, containing an untrue statement of a material fact

 

 

or omitting to state a material fact required to be stated therein or necessary
to make any statements therein not misleading or (B) the Prospectus included in
such Registration Statement containing an untrue statement of a material fact
or omitting to state a material fact required to be stated therein or necessary
to make any statements therein, in the light of the circumstances under which
they were made, not misleading, and (ii) of the Company’s reasonable
determination that a post-effective amendment to the Registration Statement
would be appropriate or that there exist circumstances not yet disclosed to the
public which make further sales under such Registration Statement inadvisable
pending such disclosure and post-effective amendment; and, if the notification
relates to any event described in either of the clauses (i) or (ii) of this
Section 2.4(f), subject to Section 2.2 above, at the request of the Holders,
the Company shall prepare and furnish to the Holders a reasonable number of
copies of a supplement or post-effective amendment to such Registration
Statement or related Prospectus or any document incorporated therein by
reference and file any other required document so that (1) such Registration
Statement shall not contain any untrue statement of a material fact or omit to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading and (2) as thereafter delivered to the
purchasers of the Registrable Securities being sold thereunder, such Prospectus
shall not include an untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading;

          (g) use commercially reasonable efforts to cause all such Registrable
Securities to be listed on the national securities exchange on which the REIT
Common Shares are then listed, if the listing of Registrable Securities is then
permitted under the rules of such national securities exchange; and

          (h) if requested by any Holder participating in the offering of
Registrable Securities, incorporate in a prospectus supplement or
post-effective amendment such information concerning the Holder or the intended
method of distribution as the Holder reasonably requests to be included therein
and is reasonably necessary to permit the sale of the Registrable Securities
pursuant to the Registration Statement, including, without limitation,
information with respect to the number of Registrable Securities being sold,
the purchase price being paid therefor and any other material terms of the
offering of the Registrable Securities to be sold in such offering; provided,
however, that the Company shall not be obligated to include in any such
prospectus supplement or post-effective amendment any requested information
that is not required by the rules of the Commission and is unreasonable in
scope compared with the Company’s most recent prospectus or prospectus
supplement used in connection with a primary or secondary offering of equity
securities by the Company.

          2.5 Obligations of the Holder. In connection with any Registration
Statement utilized by the Company to satisfy the Redemption Share Registration
Rights and/or Exchange Share Registration Rights pursuant to this Section 2,
each Holder agrees to cooperate with the Company in connection with the
preparation of the Registration
Statement, and each Holder agrees that it will (i) respond within 20
Business Days to any written request by the Company to provide or verify
information regarding the Holder or the Holder’s Registrable Securities
(including the proposed manner of sale) that may be required to be included in
such Registration Statement pursuant to the rules and regulations of the
Commission, and (ii) provide in a timely manner information regarding

 

 

the
proposed distribution by the Holder of the Registrable Securities and such
other information as may be reasonably requested by the Company from time to
time in connection with the preparation of and for inclusion in the
Registration Statement and related Prospectus. As used in this Agreement, a
“Business Day” is any Monday, Tuesday, Wednesday, Thursday or Friday other than
a day on which banks and other financial institutions are authorized or
required to be closed for business in the State of New York.

SECTION 3. INDEMNIFICATION; CONTRIBUTION

          3.1 Indemnification by the Company. The Company agrees to indemnify and
hold harmless each Holder and each person, if any, who controls any Holder
within the meaning of Section 15 of the Securities Act or Section 20 of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), and any of
their partners, members, officers, directors, employees or representatives, as
follows:

          (i) against any and all loss, liability, claim, damage,
judgment and expense whatsoever, as incurred, arising out of or
based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any
amendment thereto) pursuant to which the Registrable Securities
were registered under the Securities Act, including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact required to be stated therein
or necessary to make the statements therein not misleading or
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Prospectus (or any
amendment or supplement thereto), including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading;

          (ii) against any and all loss, liability, claim, damage,
judgment and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the
written consent of the Company; and

          (iii) against any and all expense whatsoever, as incurred
(including reasonable fees and disbursements of counsel),
reasonably incurred in investigating, preparing or defending
against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, in each case
whether or not a party, or any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission, to the extent that any such expense is not
paid under subparagraph (i) or (ii) above;

provided, however, that the indemnity provided pursuant to this Section 3.1
does not apply to any Holder with respect to any loss, liability, claim,
damage, judgment or expense to the

 

 

extent arising out of (A) any untrue
statement or omission or alleged untrue statement or omission made in reliance
upon and in conformity with written information furnished to the Company by
such Holder expressly for use in the Registration Statement (or any amendment
thereto) or the Prospectus (or any amendment or supplement thereto), or (B) any
Holder’s failure to deliver an amended or supplemental Prospectus furnished to
the Holder by the Company, if such loss, liability, claim, damage, judgment or
expense would not have arisen had such delivery occurred.

          3.2 Indemnification by Holder. Each Holder (and each permitted assignee
of such Holder, on a several basis) severally and not jointly agrees to
indemnify and hold harmless the Company, and each of its trustees and officers
(including each trustee and officer of the Company who signed a Registration
Statement), and each person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act or Section 20 of the Exchange Act,
as follows:

          (i) against any and all loss, liability, claim, damage,
judgment and expense whatsoever, as incurred, arising out of or
based upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any
amendment thereto) pursuant to which the Registrable Securities of
such Holder were registered under the Securities Act, including all
documents incorporated therein by reference, or the omission or
alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading
or arising out of or based upon any untrue statement or alleged
untrue statement of a material fact contained in any Prospectus (or
any amendment or supplement thereto), including all documents
incorporated therein by reference, or the omission or alleged
omission therefrom of a material fact necessary in order to make
the statements therein, in the light of the circumstances under
which they were made, not misleading;

          (ii) against any and all loss, liability, claim, damage,
judgment and expense whatsoever, as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever based upon any
such untrue statement or omission, or any such alleged untrue
statement or omission, if such settlement is effected with the
written consent of the Holder; and

          (iii) against any and all expense whatsoever, as incurred
(including reasonable fees and disbursements of counsel),
reasonably incurred in investigating, preparing or defending
against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened,
in each case whether or not a party, or any claim whatsoever
based upon any such untrue statement or omission, or any such
alleged untrue statement or omission, to the extent that any such
expense is not paid under subparagraph (i) or (ii) above;

provided, however, that the indemnity provided pursuant to this Section 3.2
shall only apply with respect to any loss, liability, claim, damage, judgment
or expense to the extent arising

 

 

out of (A) any untrue statement or omission or
alleged untrue statement or omission made in reliance upon and in conformity
with written information furnished to the Company by such Holder expressly for
use in the Registration Statement (or any amendment thereto) or the Prospectus
(or any amendment or supplement thereto) or (B) any Holder’s failure to deliver
an amended or supplemental Prospectus furnished to the Holder by the Company,
if such loss, liability, claim, damage or expense would not have arisen had
such delivery occurred. Notwithstanding the provisions of this Section 3.2, a
Holder and any permitted assignee shall not be required to indemnify the
Company, its officers, trustees or control persons with respect to any amount
in excess of the amount of the total proceeds to the Holder or such permitted
assignee, as the case may be, from sales of the Registrable Securities of the
Holder under the Registration Statement that is the subject of the
indemnification claim.

          3.3 Conduct of Indemnification Proceedings. An indemnified party
hereunder shall give reasonably prompt notice to the indemnifying party of any
action or proceeding commenced against it in respect of which indemnity may be
sought hereunder, but failure to so notify the indemnifying party (i) shall not
relieve it from any liability which it may have under the indemnity agreement
provided in Section 3.1 or 3.2 above, unless and only to the extent it did not
otherwise learn of such action and the lack of notice by the indemnified party
results in the forfeiture by the indemnifying party of substantial rights and
defenses, and (ii) shall not, in any event, relieve the indemnifying party from
any obligations to any indemnified party other than the indemnification
obligation provided under Section 3.1 or 3.2 above. If the indemnifying party
so elects within a reasonable time after receipt of such notice, the
indemnifying party may assume the defense of such action or proceeding at such
indemnifying party’s own expense with counsel chosen by the indemnifying party
and approved by the indemnified party, which approval shall not be unreasonably
withheld; provided, however, that the indemnifying party will not settle,
compromise or consent to the entry of any judgment with respect to any such
action or proceeding without the written consent of the indemnified party
unless such settlement, compromise or consent secures the unconditional release
of the indemnified party; and provided further, that, if the indemnified party
reasonably determines that a conflict of interest exists where it is advisable
for the indemnified party to be represented by separate counsel or that, upon
advice of counsel, there may be legal defenses available to it which are
different from or in addition to those available to the indemnifying party,
then the indemnifying party shall not be entitled to assume such defense and
the indemnified party shall be entitled to separate counsel at the indemnifying
party’s expense. If the indemnifying party is not entitled to assume the
defense of such action or proceeding as a result of the second proviso to the
preceding sentence, the indemnifying party’s counsel shall be entitled to
conduct the indemnifying party’s defense and counsel for the indemnified party
shall be entitled to conduct the defense of the indemnified party, it being
understood that both such counsel will cooperate with each other, to the extent
feasible in
light of the conflict of interest or different available legal defenses,
to conduct the defense of such action or proceeding as efficiently as possible.
If the indemnifying party is not so entitled to assume the defense of such
action or does not assume such defense, after having received the notice
referred to in the first sentence of this paragraph, the indemnifying party
will pay the reasonable fees and expenses of counsel for the indemnified party.
In such event, however, the indemnifying party will not be liable for any
settlement effected without the written consent of the indemnifying party. If
an indemnifying party is entitled to assume, and assumes, the defense of such
action or proceeding in accordance with this

 

 

paragraph, the indemnifying party
shall not be liable for any fees and expenses of counsel for the indemnified
party incurred thereafter in connection with such action or proceeding.

          3.4 (a) Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
Sections 3.1 and 3.2 above is for any reason held to be unenforceable by the
indemnified party although applicable in accordance with its terms, the Company
and the relevant Holder shall contribute to the aggregate losses, liabilities,
claims, damages and expenses of the nature contemplated by such indemnity
agreement incurred by the Company and the Holder, in such proportion as is
appropriate to reflect the relative fault of the Company, on the one hand and
the Holder, on the other hand, in connection with the statements or omissions
which resulted in such losses, claims, damages, liabilities, or expenses. The
relative fault of the indemnifying party and indemnified party shall be
determined by reference to, among other things, whether the action in question,
including any untrue or alleged untrue statement of a material fact or omission
or alleged omission to state a material fact, has been made by, or relates to
information supplied by, the indemnifying party or the indemnified party, and
the parties’ relative intent, knowledge, access to information and opportunity
to correct or prevent such action.

          (b) The parties hereto agree that it would not be just or equitable if
contribution pursuant to this Section 3.4 were determined by pro rata
allocation or by any other method of allocation which does not take account of
the equitable considerations referred to in the immediately preceding
paragraph. Notwithstanding the provisions of this Section 3.4, a Holder shall
not be required to contribute any amount in excess of the amount of the total
proceeds to such Holder from sales of the Registrable Securities of such Holder
under the Registration Statement that is the subject of the indemnification
claim.

          (c) Notwithstanding the foregoing, no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Securities Act)
shall be entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation. For purposes of this Section 3.4, each person, if
any, who controls a Holder within the meaning of Section 15 of the Securities
Act shall have the same rights to contribution as the Holder, and each trustee
of the Company, each officer of the Company who signed a Registration Statement
and each person, if any, who controls the Company within the meaning of Section
15 of the Securities Act shall have the same rights to contribution as the
Company.

SECTION 4. EXPENSES

          The Company shall pay all expenses incident to the performance by the
Company of its registration obligations under Sections 2 above, including (i)
all stock exchange, Commission and state securities registration, listing and
filing fees, (ii) all expenses incurred in connection with the preparation,
printing and distribution of any Registration Statement and Prospectus, (iii)
fees and disbursements of counsel for the Company and of the independent public
accountants of the Company, and (iv) reasonable fees and disbursements of
counsel to the Holder in connection with the Holder’s exercise of its rights
hereunder. Each Holder shall be responsible for the payment of any brokerage
and sales commissions and any transfer taxes relating to the sale or
disposition of the Registrable Securities by such Holder pursuant to this
Agreement.

 

 

SECTION 5. RULE 144 COMPLIANCE

          The Company covenants that it will use its best efforts to timely file the
reports required to be filed by the Company under the Securities Act and the
Exchange Act so as to enable the Holders to sell the Registrable Securities
pursuant to Rule 144 under the Securities Act. In connection with any sale,
transfer or other disposition by a Holder of any Registrable Securities
pursuant to Rule 144 under the Securities Act, the Company shall cooperate with
the Holder to facilitate the timely preparation and delivery of certificates
representing the Registrable Securities to be sold and not bearing any
Securities Act legend, and enable certificates for such Registrable Securities
to be for such number of shares and registered in such names as such Holder may
reasonably request at least five Business Days prior to any sale of Registrable
Securities hereunder.

SECTION 6. MISCELLANEOUS

          6.1 Integration; Amendment. This Agreement constitutes the entire
agreement among the parties hereto with respect to the matters set forth herein
and supersedes and renders of no force and effect all prior oral or written
agreements, commitments and understandings among the parties with respect to
the matters set forth herein. Except as otherwise expressly provided in this
Agreement, no amendment, modification or discharge of this Agreement shall be
valid or binding unless set forth in writing and duly executed by each of the
parties hereto.

          6.2 Waivers. No waiver by a party hereto shall be effective unless made
in a written instrument duly executed by the party against whom such waiver is
sought to be enforced, and only to the extent set forth in such instrument.
Neither the waiver by any of the parties hereto of a breach or a default under
any of the provisions of this Agreement, nor the failure of any of the parties,
on one or more occasions, to enforce any of the provisions of this Agreement or
to exercise any right or privilege hereunder shall thereafter be construed as a
waiver of any subsequent breach or default of a similar nature, or as a waiver
of any such provisions, rights or privileges hereunder.

          6.3 Assignment; Successors and Assigns. Any Contributor may assign its
rights and obligations under this Agreement without the prior written consent
of the Company in connection with a transfer of some or all of such Unit
Holder’s REIT Common
Shares or Units in accordance with the terms of the Partnership Agreement
(including the Unit Holder’s partner schedule) if the transferee agrees in
writing to be bound by all of the provisions hereof and the Contributor
provides written notice to the Company within 10 days of the effectiveness of
such assignment. Any Shareholder may assign its rights and obligations under
this Agreement without the prior written consent of the Company in connection
with the transfer of some or all of such Shareholder’s REIT Common Shares if
the transferee agrees in writing to be bound by all of the provisions hereof
and the Shareholder provides written notice to the Company within 10 days of
the effectiveness of such assignment. This Agreement shall inure to the
benefit of and be binding upon all of the parties hereto and their respective
heirs, executors, personal and legal representatives, successors and permitted
assigns, including, without limitation, any successor of the Company by merger,
acquisition, reorganization, recapitalization or otherwise.

 

 

          6.4 Notices. All notices called for under this Agreement shall be in
writing and shall be deemed given upon receipt if delivered personally or by
facsimile transmission and followed promptly by mail, or mailed by registered
or certified mail (return receipt requested), postage prepaid, or overnight
delivery service, to the parties at the addresses set forth opposite their
signatures below, or to any other address or addressee as any party entitled to
receive notice under this Agreement shall designate, from time to time, to
others in the manner provided in this Section 6.4 for the service of notices;
provided, however, that notices of a change of address shall be effective only
upon receipt thereof. Any notice delivered to the party hereto to whom it is
addressed shall be deemed to have been given and received on the day it was
received; provided, however, that if such day is not a Business Day, then the
notice shall be deemed to have been given and received on the Business Day next
following such day and if any party rejects delivery of any notice attempted to
be given hereunder, delivery shall be deemed given on the date of such
rejection. Any notice sent by facsimile transmission shall be deemed to have
been given and received on the Business Day next following the transmission.

          6.5 Specific Performance. The parties hereto acknowledge that the
obligations undertaken by them hereunder are unique and that there would be no
adequate remedy at law if any party fails to perform any of its obligations
hereunder, and accordingly agree that each party, in addition to any other
remedy to which it may be entitled at law or in equity, shall be entitled to
(i) compel specific performance of the obligations, covenants and agreements of
any other party under this Agreement in accordance with the terms and
conditions of this Agreement and (ii) obtain preliminary injunctive relief to
secure specific performance and to prevent a breach or contemplated breach of
this Agreement in any court of the United States or any State thereof having
jurisdiction.

          6.6 Governing Law. This Agreement, the rights and obligations of the
parties hereto, and any claims or disputes relating thereto, shall be governed
by and construed in accordance with the laws of the State of Maryland, but not
including the choice of law rules thereof.

          6.7 Headings. Section and subsection headings contained in this
Agreement are inserted for convenience of reference only, shall not be deemed
to be a part of this Agreement for any purpose, and shall not in any way define
or affect the meaning, construction or scope of any of the provisions hereof.

          6.8 Pronouns. All pronouns and any variations thereof shall be deemed to
refer to the masculine, feminine, neuter, singular or plural, as the identity
of the person or entity may require.

          6.9 Execution in Counterparts. To facilitate execution, this Agreement
may be executed and delivered in as many counterparts as may be required. It
shall not be necessary that the signature of or on behalf of each party appears
on each counterpart, but it shall be sufficient that the signature of or on
behalf of each party appears on one or more of the counterparts. All
counterparts shall collectively constitute a single agreement. It shall not be
necessary in any proof of this Agreement to produce or account for more than a
number of counterparts containing the respective signatures of or on behalf of
all of the parties.

 

 

          6.10 Severability. If fulfillment of any provision of this Agreement, at
the time such fulfillment shall be due, shall transcend the limit of validity
prescribed by law, then the obligation to be fulfilled shall be reduced to the
limit of such validity; and if any clause or provision contained in this
Agreement operates or would operate to invalidate this Agreement, in whole or
in part, then such clause or provision only shall be held ineffective, as
though not herein contained, and the remainder of this Agreement shall remain
operative and in full force and effect.

[Signatures on following page]

 

 

          IN WITNESS WHEREOF, each of the undersigned has caused this Agreement to
be duly executed and delivered in its name and on its behalf as of the date
first written above.

	 	 	 
	Address:
	 	 
	 
	 	 
	

	 	COMPANY:
	 
	 	 
	U-STORE-IT TRUST

	 	U-STORE-IT TRUST
	6745 Engle Road, Suite 300
	 	 
	Middleburg Heights, Ohio 44130

	 	By:
	Attention: Steven G. Osgood

	 	

	Facsimile: (440) 234-8776

	 	Name: Steven G. Osgood
	

	 	Title: President
	 
	 	 
	

	 	HOLDERS:
	 
	 	 
	Robert J. Amsdell
	 	 
	6745 Engle Road, Suite 300

	 	

	Middleburg Heights, Ohio 44130

	 	Robert J. Amsdell
	Attention: Robert J. Amsdell
	 	 
	Facsimile:(440) 234-8776
	 	 
	 
	 	 
	Barry L. Amsdell
	 	 
	6745 Engle Road, Suite 300

	 	

	Middleburg Heights, Ohio 44130

	 	Barry L. Amsdell
	Attention: Barry L. Amsdell
	 	 
	Facsimile: (440) 234-8776
	 	 
	 
	 	 
	Todd C. Amsdell
	 	 
	6745 Engle Road, Suite 300

	 	

	Middleburg Heights, Ohio 44130

	 	Todd C. Amsdell
	Attention: Todd C. Amsdell
	 	 
	Facsimile: (440) 234-8776
	 	 

 

 

	 	 	 
	The Robert J. Amsdell Family Irrevocable

	 	THE ROBERT J. AMSDELL FAMILY
	Trust dated June 4, 1998

	 	IRREVOCABLE TRUST DATED JUNE 4,
	c/o David M. Kall

	 	1998
	McDonald, Hopkins, Burke & Haber Co.,
	 	 
	L.P.A.

	 	By:
	2100 Bank One Center

	 	

	600 Superior Avenue, E.

	 	Name: Benard L. Karr
	Cleveland, OH 44114-2653

	 	Its: Trustee
	 
	 	 
	The Loretta Amsdell Family Irrevocable

	 	THE LORETTA AMSDELL FAMILY
	Trust dated June 4, 1998

	 	IRREVOCABLE TRUST DATED JUNE 4,
	c/o David M. Kall

	 	1998
	McDonald, Hopkins, Burke & Haber
	 	 
	Co., L.P.A.

	 	By:
	2100 Bank One Center

	 	

	600 Superior Avenue, E.

	 	Name: Benard L. Karr
	Cleveland, OH 44114-2653

	 	Its: Trustee
	 
	 	 
	Amsdell and Amsdell

	 	AMSDELL AND AMSDELL
	6745 Engle Road, Suite 300
	 	 
	Middleburg Heights, Ohio 44130

	 	By:
	Attention: Robert J. Amsdell

	 	

	Facsimile: (440) 234-8776

	 	Name: Robert J. Amsdell
	

	 	Its: General Partner
	 
	 	 
	Amsdell Holdings I, Inc.

	 	AMSDELL HOLDINGS I, INC.
	6745 Engle Road, Suite 300
	 	 
	Middleburg Heights, Ohio 44130

	 	By:
	Attention: Robert J. Amsdell

	 	

	Facsimile: (440) 234-8776

	 	Name: Robert J. Amsdell
	

	 	Its: President
	 
	 	 
	Robert J. Amsdell, Trustee

	 	

	6745 Engle Road, Suite 300

	 	Robert J. Amsdell, Trustee
	Middleburg Heights, Ohio 44130
	 	 
	Attention: Robert J. Amsdell
	 	 
	Facsimile: (440) 234-8776
	 	 

2

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