EXHIBIT
10.1
FIRST AMENDMENT TO
CONTRIBUTION AGREEMENT AND TO
AGREEMENT REGARDING TRANSFER OF SERIES A UNITS
(AAAAA Rent-A-Space)
THIS FIRST AMENDMENT TO
CONTRIBUTION AGREEMENT AND TO AGREEMENT REGARDING TRANSFER OF
SERIES A UNITS (hereinafter the “First Amendment”)
is executed on the 28th day of September, 2007, but made and
entered into effective as of the 25th day of June, 2007, by,
between, and among AAAAA RENT-A-SPACE, ALAMEDA, LTD., LIMITED
PARTNERSHIP, a California limited partnership, AAAAA
RENT-A-SPACE, ALAMEDA II, LTD. LIMITED PARTNERSHIP, a
California limited partnership, AAAAA RENT-A-SPACE, BERKELEY I,
LTD., LIMITED PARTNERSHIP , a California limited partnership,
AAAAA RENT-A-SPACE, BERKELEY II, LTD., LIMITED PARTNERSHIP ,
a California limited partnership, AAAAA RENT-A-SPACE —
CASTRO VALLEY, LTD. LIMITED PARTNERSHIP , a California limited
partnership, AAAAA RENT-A-SPACE — COLMA, LTD.
LIMITED PARTNERSHIP , a California limited partnership,
AAAAA RENT-A-SPACE, HAYWARD, LTD., LIMITED PARTNERSHIP , a
California limited partnership, AAAAA RENT-A-SPACE —
MAUI, A LIMITED PARTNERSHIP, a Hawaiian limited
partnership, AAAAA RENT-A-SPACE, SAN LEANDRO, LTD., LIMITED
PARTNERSHIP, a California limited partnership, AAAAA
RENT-A-SPACE, SAN PABLO, LTD. LIMITED PARTNERSHIP, a California
limited partnership, and AAAAA RENT-A-SPACE — VALLEJO,
LTD. LIMITED PARTNERSHIP, a California limited partnership
(each hereinafter individually referred to as a
“Contributor” and collectively the
“Contributors”), H. JAMES KNUPPE (hereinafter
“James Knuppe”), BARBARA KNUPPE , and EXTRA
SPACE STORAGE LP , a Delaware limited partnership (hereinafter
“Extra Space”).
R E C I T A L
S:
A.
Pursuant to that certain
Contribution Agreement dated effective as of June 15, 2007, between
Contributors and Extra Space (hereinafter the “Contribution
Agreement”), each of the Contributors conveyed to Extra Space
certain real and personal property owned by such Contributor in
exchange for certain “Series A Preferred Units”
(hereinafter collectively the “Series A Units”), as
defined in the Second Amended and Restated Agreement of Limited
Partnership for Extra Space (the “Partnership
Agreement”), all as more particularly described in the
Contribution Agreement.
B.
Pursuant to that certain
Agreement Regarding Transfer of Series A Units dated June 25, 2007,
between Contributors, James Knuppe, Barbara Knuppe, Extra Space,
and others (hereinafter the “Transfer Agreement”), the
parties to the Transfer Agreement agreed that all of the Series A
Units to be issued by Extra Space pursuant to the Contribution
Agreement would be issued directly to James Knuppe and Barbara
Knuppe and James Knuppe and Barbara Knuppe assumed certain
obligations of the Contributors under the Contribution Agreement
with respect to the Series A Units.
C.
Pursuant to the
Partnership Agreement and the Contribution Agreement, James Knuppe
and Barbara Knuppe have certain rights to require Extra Space to
redeem the Series A Units. The parties to this Agreement
desire to make certain amendments to the provision of the
Contribution Agreement relating to the redemption of the Series A
Units.
NOW, THEREFORE, for and in consideration of the
mutual covenants and conditions set forth in this First Amendment,
the receipt and sufficiency of which are acknowledged by the
parties to this Agreement, the parties to this Agreement do hereby
agree as follows:
1.
Amendment of Section 3(f) of
Contribution Agreement . Section 3(f) of the Contribution
Agreement is hereby amended by deleting said Section 3(f) in its
entirety and replacing it with the following Section
3(f):
(f)
Issuance of Series A
Preferred Units. The Series A Preferred Units shall be
issued and delivered to Contributors at Closing. Subject to
the terms and conditions set forth in this Agreement (including
this Section 3(f)) and that certain Promissory Note dated June 25,
2007, in the original principal amount of $100,000,000.00 and in
which H. James Knuppe and Barbara Knuppe appear as Borrowers and
Acquiror appears as Lender (hereinafter the “Note”),
the Series A Preferred Units shall be redeemable for cash or
exchangeable for shares (“ Conversion Shares ”)
of the Stock in accordance with the provisions of the Amended and
Restated Partnership Agreement (hereinafter defined).
Pursuant to Section 16.4B of the Amended and Restated Partnership
Agreement, at such time as a “Tendering Series A Preferred
Unit Holder” (as defined in the Amended and Restated
Partnership Agreement) elects (or is deemed to have elected) to
require Acquiror to redeem all or any portion of such Tendering
Series A Preferred Unit Holder’s “Tendered Series A
Preferred Units” (as defined in the Amended and Restated
Partnership Agreement), “Parent” (as defined in the
Amended and Restated Partnership Agreement) may elect to acquire
some or all of the Tendered Series A Preferred Units of such
Tendering Series A Preferred Unit Holder in exchange for
Stock. Notwithstanding anything to the contrary in the
Amended and Restated Partnership Agreement, if Parent elects to
acquire any Tendered Series A Preferred Units of a Tendering Series
A Preferred Unit Holder, the following provisions shall
apply:
(1)
Parent shall not have any
obligation to issue in the aggregate to all Tendering Series A
Preferred Unit Holders more than 116,000,000 shares of the Stock
(hereinafter the “Maximum Shares of Stock”) with
respect to Parent’s acquisition of any or all of the Series A
Preferred Units issued pursuant to this Agreement;
(2)
Parent’s obligation
to issue shares of the Stock with respect to any Tendered Series A
Preferred Unit shall be deemed to have been satisfied in full upon
the issuance by Parent of the Maximum Shares of Stock with respect
to the acquisition of Tendered Series A Preferred Units regardless
of whether the Maximum Shares of Stock were issued with respect to
(A) the acquisition of such Tendered Series A Preferred
Unit,
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(B)
the acquisition of such Tendered Series A Preferred Unit in
combination with the acquisition of other Tendered Series A
Preferred Units, or (C) the acquisition of other Tendered Series A
Preferred Units.
(3)
Effective upon the
issuance of the Maximum Shares of Stock with respect to the
acquisition of one or more Tendered Series A Preferred Units issued
pursuant to this Agreement, all Series A Preferred Units issued
pursuant to this Agreement shall, to the extent not previously
redeemed by Acquiror or acquired by Parent, be deemed to have been
redeemed in full and shall no longer be issued or outstanding and
neither Acquiror nor Parent shall have any obligation to pay any
additional amounts with respect to any of the Series A Preferred
Units issued pursuant to this Agreement.
Anything in the Amended and Restated
Partnership Agreement to the contrary notwithstanding, Acquiror
agrees that so long as the Series A Preferred Units remain issued
and outstanding, Acquiror shall not (i) authorize or issue any
securities in Acquiror having any preference as to or on a parity
with the dividend or redemption rights, liquidation preferences,
conversion rights, voting rights or any other rights or privileges
of the Series A Preferred Units, (ii) reclassify any partnership
interests into interests having any preference as to or on a parity
with the dividend or redemption rights, liquidation preferences,
conversion rights, voting rights or any other rights or privileges
of the Series A Preferred Units, (iii) authorize or issue any debt
which is convertible into or exchangeable for, partnership
interests in Acquiror having any preference as to or on parity with
the dividend or redemption rights, liquidation preferences,
conversion rights, voting rights or any other rights or privileges
of the Series A Preferred Units, or (iv) amend or repeal any
provision of, or add any provision to the Amended and Restated
Partnership Agreement if such actions would alter or change the
preferences, rights, privileges or restrictions provided for the
benefit of the Series A Preferred Units.
2.
Amendment of Section 1 of
Promissory Note . The penultimate sentence of Section 1
of that certain Promissory Note dated June 25, 2007 from James
Knuppe and Barbara Knuppe to Extra Space (hereinafter the
“Promissory Note”) shall be replaced with the
following:
Borrowers and Lender agree that Lender shall
have the right, immediately and without prior demand or notice, to
offset any distributions payable to Borrowers, or either of them or
any of their respective assignees, with respect to any Series A
Units (whether now owned or hereafter acquired by Borrowers, either
Borrower or any of their respective assignees) against any amounts
due and payable hereunder. Borrowers and Lender agree that
for purposes of applying the preceding sentence: (a) the term
“distribution” shall include payments by Lender in
redemption of Series A Units pursuant to the Partnership Agreement
(hereinafter defined) and the issuance of any “REIT
Shares” (as defined in the Partnership Agreement) by
“Parent” (as defined in the Partnership Agreement) as
consideration for Parent’s acquisition of Series A Units
pursuant to Section 16.4B
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of
the Partnership Agreement, and (b) if any Series A Units are
assigned by Borrowers, for purposes of Lender’s exercise of
Lender’s right of offset (and solely for such purpose), each
assignee shall be deemed to have assumed a proportionate share of
the liability under this Note based on the number of Series A Units
that are issued and outstanding as of the date of such
determination. Furthermore, to the extent of any amounts then
due and owing, but unpaid, by Lender with respect to the Series A
Units, Borrowers may, at Borrowers’ option and
notwithstanding any assignment by Lender of Lender’s rights
under this Note to any controlled affiliate of Lender, immediately
and without prior demand or notice, offset such
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