Exhibit 10.5
INDEMNIFICATION
AGREEMENT
THIS INDEMNIFICATION
AGREEMENT (this
“Agreement”) is entered into as of March 22, 2007, by
and among U-Store-It Trust, a Maryland real estate investment trust
(the “Company”), U-Store-It, L.P., a Delaware limited
partnership (the “Operating Partnership” and together
with the Company, the “Indemnitors”), and Marianne M.
Keler (the “Indemnitee”).
WHEREAS , the Indemnitee is an officer or a member of
the Board of Trustees of the Company and in such capacity is
performing a valuable service for the Company and the Operating
Partnership;
WHEREAS , Maryland law permits the Company to enter into
contracts with its officers or members of its Board of Trustees
with respect to indemnification of, and advancement of expenses to,
such persons;
WHEREAS, the Declaration of Trust of the Company (the
“Declaration of Trust”) authorizes the Company to
indemnify and advance expenses to its officers and trustees to the
maximum extent permitted by Maryland law in effect from time to
time;
WHEREAS , the Bylaws of the Company (the
“Bylaws”) provide that each officer and trustee of the
Company shall be indemnified by the Company to the maximum extent
permitted by Maryland law in effect from time to time and shall be
entitled to advancement of expenses consistent with Maryland
law;
WHEREAS , the Company is the general partner of, and
conducts substantially all of its business through, the Operating
Partnership;
WHEREAS, the Second Amended and Restated Partnership
Agreement of the Operating Partnership (the “Partnership
Agreement”) provides for indemnification and advancement of
expenses to the Company and its officers and trustees consistent
with the applicable provisions of Maryland law, subject to the same
limitations on indemnity and advancement of expenses that apply
under Maryland law to indemnity and advancement of expenses by the
Company of its officers and trustees; and
WHEREAS , to induce the Indemnitee to provide services
to the Company as an officer or a member of the Board of Trustees,
and to provide the Indemnitee with specific contractual assurance
that indemnification will be available to the Indemnitee regardless
of, among other things, any amendment to or revocation of the
Declaration of Trust, the Bylaws or the Partnership Agreement, or
any acquisition transaction relating to the Company, the
Indemnitors desire to provide the Indemnitee with protection
against personal liability as set forth herein;
NOW, THEREFORE
, in consideration of the premises
and the covenants contained herein, the Indemnitors and the
Indemnitee hereby agree as follows:
1.
DEFINITIONS
.
For purposes of this
Agreement:
(A)
“Change in Control”
shall mean
i.
the dissolution or liquidation of
the Company;
ii.
the merger,
consolidation, or reorganization of the Company with one or more
other entities in which the Company is not the surviving entity or
immediately following which the persons or entities who were
beneficial owners (as determined pursuant to Rule 13d-3 under the
Securities Exchange Act of 1934, as amended (the “Exchange
Act”)) of voting securities of the Company immediately prior
thereto cease to beneficially own more than fifty percent (50%) of
the voting securities of the surviving entity immediately
thereafter;
iii.
a sale of all or substantially all
of the assets of the Company to another person or entity other than
an affiliate of the Company;
iv.
any transaction
(including without limitation a merger or reorganization in which
the Company is the surviving entity) that results in any person or
entity or “group” (within the meaning of Section
13(d)(3) or 14(d)(2) of the Exchange Act) (other than persons who
are shareholders or affiliates immediately prior to the
transaction) owning thirty percent (30%) or more of the combined
voting power of all classes of shares of the Company;
or
v.
individuals who, as of the date
hereof, constitute the Board of Trustees (the “Incumbent
Board”) cease for any reason to constitute at least a
majority of the Board of Trustees; provided, however, that any
individual becoming a trustee subsequent to the date hereof whose
election, or nomination for election by the Company’s
shareholders, was approved by a vote of at least a majority of the
trustees then comprising the Incumbent Board (either by a specific
vote or by approval of the proxy statement of the Company in which
such person is named as a nominee for trustee, without written
objection to such nomination) shall be considered as though such
individual were a member of the Incumbent Board, but excluding, for
this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election
contest with respect to the election or removal of trustees or
other actual or threatened solicitation of proxies or contests by
or on behalf of a person other than the Board of
Trustees.
(B)
“Corporate Status”
describes the status of a person who is or was a trustee or officer
of the Company (or of any domestic or foreign predecessor entity of
the Company in a merger, consolidation or other transaction in
which the
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predecessor’s interest ceased
upon consummation of the transaction) or is or was serving at the
request of the Company (or any such predecessor entity) as a
director, officer, partner (limited or general), member, trustee,
employee or agent of any other foreign or domestic corporation,
partnership, joint venture, limited liability company, trust, other
enterprise (whether conducted for profit or not for profit) or
employee benefit plan. The Company (and any domestic or foreign
predecessor entity of the Company in a merger, consolidation or
other transaction in which the predecessor’s existence ceased
upon consummation of the transaction) shall be deemed to have
requested the Indemnitee to serve an employee benefit plan where
the performance of the Indemnitee’s duties to the Company (or
any such predecessor entity) also imposes or imposed duties on, or
otherwise involves or involved services by, the Indemnitee to the
plan or participants or beneficiaries of the plan.
(C)
“Expenses” shall include
all attorneys’ and paralegals’ fees, retainers, court
costs, transcript costs, fees of experts, witness fees, travel
expenses, duplicating costs, printing and binding costs, telephone
charges, postage, delivery service fees, and all other
disbursements or expenses of the types customarily incurred in
connection with prosecuting, defending, preparing to prosecute or
defend, investigating, or being or preparing to be a witness in a
Proceeding.
(D)
“Proceeding” includes
any action, suit, arbitration, alternate dispute resolution
mechanism, investigation, administrative hearing, or any other
proceeding, including appeals therefrom, whether civil, criminal,
administrative, or investigative, except one initiated by the
Indemnitee pursuant to paragraph 8 of this Agreement to enforce
such Indemnitee’s rights under this Agreement.
(E)
“Special Legal Counsel”
means a law firm, or a member of a law firm, that is experienced in
matters of corporation law and neither presently is, or in the past
two years has been, retained to represent (i) the Indemnitors or
the Indemnitee in any matter material to either such party, or (ii)
any other party to the Proceeding giving rise to a claim for
indemnification hereunder.
2.
INDEMNIFICATION
The Indemnitee shall be entitled to
the rights of indemnification provided in this paragraph 2 and
under applicable law, the Declaration of Trust, the Bylaws, the
Partnership Agreement, any other agreement, a vote of shareholders
or resolution of the Board of Trustees or otherwise if, by reason
of such Indemnitee’s Corporate Status, such Indemnitee is, or
is threatened to be made, a party to any threatened, pending, or
completed Proceeding, including a Proceeding by or in the right of
the Company or the Operating Partnership. Unless prohibited
by paragraph 13 hereof and subject to the other provisions of this
Agreement, the Indemnitee shall be indemnified hereunder, to the
maximum extent provided by Maryland law in effect from time to
time, against judgments, penalties, fines, and settlements and
reasonable Expenses actually incurred by or on behalf of such
Indemnitee in connection with such Proceeding or any claim, issue
or matter therein; provided, however, that if such Proceeding was
one by or in the right of
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the Company or the Operating
Partnership, indemnification may not be made in respect of such
Proceeding if the Indemnitee shall have been adjudged to be liable
to the Company or the Operating Partnership. For purposes of
this paragraph 2, excise taxes assessed on the Indemnitee with
respect to an employee benefit plan pursuant to applicable law
shall be deemed fines.
3.
EXPENSES OF A SUCCESSFUL
PARTY
Without limiting the effect of any
other provision of this Agreement and without regard to the
provisions of paragraph 6 hereof, to the extent that the Indemnitee
is, by reason of such Indemnitee’s Corporate Status, a party
to and is successful, on the merits or otherwise, in any Proceeding
pursuant to a final non-appealable order, such Indemnitee shall be
indemnified against all reasonable Expenses actually incurred by
such Indemnitee in connection therewith. If the Indemnitee is
not wholly successful in such Proceeding pursuant to a final
non-appealable order but is successful, on the merits or otherwise,
as to one or more but less than all claims, issues, or matters in
such Proceeding pursuant to a final non-appealable order, the
Indemnitors shall indemnify the Indemnitee against all reasonable
Expenses actually incurred by such Indemnitee in connection with
each successfully resolved claim, issue or matter. For
purposes of this paragraph and without limitation, the termination
of any claim, issue or matter in such Proceeding by dismissal, with
or without prejudice, shall be deemed to be a successful result as
to such claim, issue or matter.
4.
ADVANCEMENT OF
EXPENSES
The Indemnitors shall advance all
reasonable Expenses incurred by the Indemnitee in connection with
any Proceeding within 20 days after the receipt by the Indemnitors
of a statement from the Indemnitee requesting such advance from
time to time, whether prior to or after final disposition of such
Proceeding. Such statement shall reasonably evidence the
Expenses incurred or to be incurred by the Indemnitee and shall
include or be preceded or accompanied by (i) a written affirmation
by the Indemnitee of the Indemnitee’s good faith belief that
the standard of conduct necessary for indemnification by the
Indemnitors as authorized by this Agreement has been met and (ii) a
written undertaking by or on behalf of the Indemnitee to repay the
amounts advanced if it should ultimately be determined that the
standard of conduct has not been met. The undertaking
required by clause (ii) of the immediately preceding sentence shall
be an unlimited general obligation of the Indemnitee but need not
be secured and may be accepted without reference to financial
ability to make the repayment.
5.
WITNESS EXPENSES
Notwithstanding any other provision
of this Agreement, to the extent that the Indemnitee is, by reason
of such Indemnitee’s Corporate Status, a witness for any
reason in any Proceeding to which such Indemnitee is not a named
defendant or respondent, such Indemnitee shall be indemnified by
the Indemnitors against all Expenses actually incurred by or on
behalf of such Indemnitee in connection therewith.
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6.
DETERMINATION OF ENTITLEMENT TO
AND AUTHORIZATION OF INDEMNIFICATION
(A)
To obtain indemnification under this
Agreement, the Indemnitee shall submit to the Indemnitors a written
request, including therewith such documentation and information
reasonably necessary to determine whether and to what extent the
Indemnitee is entitled to indemnification.
(B)
Indemnification under this Agreement
may not be made unless authorized for a specific Proceeding after a
determination has been made in accordance with this Section 6(B)
that indemnification of the Indemnitee is permissible in the
circumstances because the Indemnitee has met the following standard
of conduct: the Indemnitors shall indemnify the Indemnitee in
accordance with the provisions of paragraph 2 hereof, unless it is
established that: (a) the act or omission of the Indemnitee
was material to the matter giving rise to the Proceeding and (x)
was committed in bad faith or (y) was the result of active and
deliberate dishonesty; (b) the Indemnitee actually received an
improper personal benefit in money, property or services; or (c) in
the case of any criminal proceeding, the Indemnitee had reasonable
cause to believe that the act or omission was unlawful. Upon
receipt by the Indemnitors of the Indemnitee’s written
request for indemnification pursuant to subparagraph 6(A), a
determination as to whether the applicable standard of conduct has
been met shall be made within the period specified in paragraph
6(E): (i) if a Change in Control shall have occurred, by
Special Legal Counsel in a written opinion to the Board of
Trustees, a copy of which shall be delivered to the Indemnitee,
with Special Legal Counsel selected by the Indemnitee (unless the
Indemnitee shall request that such determination be made by the
person or persons and in the manner provided in clause (ii) of this
paragraph 6(B), in which event the provisions of such clause (ii)
shall apply) (If the Indemnitee selects Special Legal Counsel to
make the determination under this clause (i), the Indemnitee shall
give prompt written notice to the Indemnitors advising them of the
identity of the Special Legal Counsel so selected); or (ii) if a
Change in Control shall not have occurred, (A) by the Board of
Trustees by a majority vote of a quorum consisting of trustees not,
at the time, parties to the Proceeding, or, if such quorum cannot
be obtained, then by a majority vote of a committee of the Board of
Trustees consisting solely of two or more trustees not, at the
time, parties to such Proceeding and who were duly designated to
act in the matter by a majority vote of the full Board of Trustees
in which the designated trustees who
