8-KMaterial AgreementsExhibits & Filings

Extra Space Storage Inc. 8-K Report, Material Agreement (May 19, 2023)

Filed May 19, 2023For Securities:EXR

Summary

Extra Space Storage Inc. (EXR) filed an 8-K on May 19, 2023, primarily to disclose an amendment to its existing Agreement and Plan of Merger with Life Storage, Inc. (LSI). This amendment, entered into on May 18, 2023, modifies certain terms of the previously announced combination of the two self-storage companies. Key changes include the removal of specific rights for minority limited partners and holders of Life Storage OP preferred units, as well as a modification to the 'top-up' payment for certain Life Storage restricted common stockholders. While the core merger structure remains, these amendments refine the mechanics of the transaction. Investors should note that the removal of minority limited partners' right to elect Extra Space common stock in the Partnership Merger means they will continue to have the right to redeem their interests for cash or Life Storage common stock. Furthermore, the amendment regarding Life Storage OP preferred units is effectively moot as all holders have already converted their units. The 'top-up' cash payment for Life Storage restricted stock will now be replaced by performance stock units, representing a similar economic value. These changes are part of the ongoing process to finalize the merger, and further regulatory filings and disclosures will be forthcoming.

Key Highlights

  • 1Amendment to the Merger Agreement between Extra Space Storage (EXR) and Life Storage (LSI) entered into on May 18, 2023.
  • 2Modification removes the right of Minority Limited Partners to elect Extra Space common stock in the Partnership Merger; they retain redemption rights for cash or Life Storage common stock.
  • 3Removes the right for Life Storage OP preferred unit holders to convert to common units or receive a liquidation preference payment, as all preferred units have already been converted.
  • 4Replaces the 'top-up' cash payment for certain Life Storage restricted common stockholders with 'top-up' grants of Life Storage performance stock units of equivalent value.
  • 5These amendments refine the terms of the previously announced merger, indicating continued progress toward the transaction.
  • 6The filing includes a disclaimer about forward-looking statements and outlines procedures for obtaining additional information regarding the transaction, including the upcoming Form S-4 filing.

Frequently Asked Questions

The main purpose of this 8-K filing is to report an amendment to the Agreement and Plan of Merger between Extra Space Storage Inc. and Life Storage, Inc. that was agreed upon on May 18, 2023. It details specific changes to the terms of the merger.

The amendment removes the right for Minority Limited Partners to elect to receive shares of Extra Space common stock in the Partnership Merger. However, they will continue to have the right under the Life Storage OP limited partnership agreement to elect to redeem their common limited partnership interests for cash or Life Storage common stock prior to the merger.

The amendment removed the election right for holders of Life Storage OP preferred units to convert to common units or receive a cash payment equal to the liquidation preference. This change is effectively moot, as all holders of Life Storage OP preferred units have already elected to convert their preferred units to common units according to the terms of those units.

The amendment replaces the 'top-up' cash payment that certain holders of Life Storage restricted common stock would have otherwise received with 'top-up' grants of Life Storage performance stock units. These performance stock units represent a right to receive shares of Life Storage common stock with a fair market value substantially equivalent to the cash payment they would have received.