SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) April 25, 1995
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Storage Equities, Inc.
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(Exact name of registrant as specified in its charter)
California 1-8389 95-3551121
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(State or other juris- (Commission (IRS Employer
diction of incorporation) File Number) Identification No.)
600 North Brand Boulevard, Glendale, California 91203-1241
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(Address of principal executive office) (Zip Code)
Registrant's telephone number, including area code (818) 244-8080
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N/A
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(Former name or former address, if changed since last report)
Item 5. Other Events
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On August 4, 1994, the Securities and Exchange Commission
declared effective the Registration Statement on Form S-3 (No. 33-54755)
of Storage Equities, Inc. (the "Company"), which together with the
securities previously registered pursuant to the Company's Registration
Statement on Form S-3 (No. 33-71336), permits the Company to issue an
aggregate of $300,000,000 of preferred stock, common stock and warrants.
Item 7. Financial Statements and Exhibits
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(c) Exhibits.
Exhibit 1.1 - Form of Underwriting Agreement relating to
the Company's ____% Cumulative Preferred Stock, Series F (the "Preferred
Stock").
Exhibit 3.1 - Form of Certificate of Determination for the
Preferred Stock.
Exhibit 10.1 - Seventh Amendment to Amended and Restated
Advisory Contract between the Company and Public Storage Advisers,
Inc. dated as of April 13, 1995.
SIGNATURES
Pursuant to the requirements of the Securities Exchange
Act of 1934, the Registrant has duly caused this report to be
signed on its behalf by the undersigned hereunto duly authorized.
STORAGE EQUITIES, INC.
By: /S/ OBREN B. GERICH
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Obren B. Gerich
Vice President
Date: April 25, 1995
EXHIBIT 1.1
STORAGE EQUITIES, INC.
1,500,000 Shares
__% Cumulative Preferred Stock, Series F
(Stated Value $25.00 Per Share)
UNDERWRITING AGREEMENT
April __, 1995
SMITH BARNEY INC.
PAINEWEBBER INCORPORATED
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
THE ROBINSON-HUMPHREY
COMPANY, INC.
As Representatives of the Several Underwriters
c/o SMITH BARNEY INC.
388 Greenwich Street
New York, New York 10013
Ladies and Gentlemen:
Storage Equities, Inc., a real estate investment trust ("REIT") and
a California corporation (the "Company"), proposes to issue and sell an
aggregate of 1,500,000 shares (the "Firm Shares") of its ____% Cumulative
Preferred Stock, Series F, stated value $25.00 per share (the "Preferred
Stock"), to you and the other underwriters named in Schedule I hereto
(collectively the "Underwriters") for whom you are acting as
Representatives (the "Representatives"). The Company also proposes to
sell to the Underwriters, upon the terms and conditions set forth in
Section 1 hereof, up to an additional 225,000 shares (the "Additional
Shares") of Preferred Stock. The Firm Shares and the Additional Shares
are hereinafter collectively referred to as the "Shares."
The Company wishes to confirm as follows its agreement with you and
the other several Underwriters on whose behalf you are acting, in
connection with the several purchases of the Shares by the Underwriters.
1. Agreements to Sell and Purchase.
(a) On the basis of the representations, warranties and
agreements of the Company herein contained and subject to all the terms
and conditions of this Agreement, the Company agrees to sell to the
Underwriters and each Underwriter agrees, severally and not jointly, to
purchase from the Company, at a purchase price of $_____ per share (the
"purchase price per share"), the number of Firm Shares set forth opposite
the name of such Underwriter in Schedule I hereto (or such number of Firm
Shares increased as set forth in Section 9 hereof).
(b) The Company also agrees, subject to all the terms and
conditions set forth herein, to sell to the Underwriters, and, upon the
basis of the representations, warranties and agreements of the Company
herein contained and subject to all the terms and conditions set forth
herein, the Underwriters shall have the right to purchase from the
Company, at the purchase price per share, pursuant to an option (the
"over-allotment option") which may be exercised at any time and from time
to time prior to 9:00 P.M., New York City time, on the 30th day after the
date of the Prospectus (as defined in Section 4) (or, if such 30th day
shall be a Saturday or Sunday or a holiday, on the next business day
thereafter when the New York Stock Exchange is open for trading), up to an
aggregate of 225,000 Additional Shares. Additional Shares may be
purchased only for the purpose of covering over-allotments made in
connection with the offering of the Firm Shares. Upon any exercise of the
over-allotment option, each Underwriter, severally and not jointly, agrees
to purchase from the Company the number of Additional Shares (subject to
such adjustments as you may determine in order to avoid fractional shares)
which bears the same proportion to the number of Additional Shares to be
purchased by the Underwriters as the number of Firm Shares set forth
opposite the name of such Underwriter in Schedule I hereto (or such number
of Firm Shares increased as set forth in Section 9 hereof) bears to the
aggregate number of Firm Shares.
2. Terms of Public Offering. The Company has been advised
by you that the Underwriters propose to make a public offering of their
respective portions of the Shares as soon after this Agreement (and, if
necessary, any post-effective amendment to the Registration Statement) has
become effective as in your judgment is advisable and initially to offer
the Shares upon the terms set forth in the Prospectus.
3. Delivery of the Shares and Payment Therefor. Delivery
to the Underwriters of and payment for the Firm Shares shall be made at
the office of Smith Barney Inc., 388 Greenwich Street, New York, NY 10013,
at 10:00 A.M., New York City time, on May __, 1995 (the "Closing Date").
The place of closing for the Firm Shares and the Closing Date may be
varied by agreement between you and the Company.
Delivery to the Underwriters of and payment for any Additional
Shares to be purchased by the Underwriters shall be made at the
aforementioned office of Smith Barney Inc. at such time on such date (the
"Option Closing Date"), which may be the same as the Closing Date but
shall in no event be earlier than the Closing Date nor earlier than three
nor later than ten business days after the giving of the notice
hereinafter referred to, as shall be specified in a written notice from
you on behalf of the Underwriters to the Company of the Underwriters'
determination to purchase a number, specified in such notice, of
Additional Shares. The place of closing for any Additional Shares and the
Option Closing Date for such Shares may be varied by agreement between you
and the Company.
Certificates for the Firm Shares and for any Additional Shares
to be purchased hereunder shall be registered in such names and in such
denominations as you shall request prior to 1:00 P.M., New York City time,
on the third business day preceding the Closing Date or any Option Closing
Date, as the case may be. Such certificates shall be made available to
you in New York City for inspection and packaging not later than 9:30
A.M., New York City time, on the business day next preceding the Closing
Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and any Additional Shares to be purchased
hereunder shall be delivered to you on the Closing Date or the Option
Closing Date, as the case may be, against payment of the purchase price
therefor by certified or official bank check or checks payable in New York
Clearing House (next day) funds to the order of the Company.
4. Representations and Warranties of the Company. The
Company represents, warrants and covenants to the Underwriters as set
forth below. Certain terms used in this Section 4 are defined in
paragraph (ab) hereof.
(a) The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement (file number
33-54755 (the "Registration Statement")) on Form S-3, including the
related prospectus included in such Registration Statement, for the
registration under the Securities Act of 1933, as amended (the "Act"), of
the offering and sale of the Shares. The Company may have filed one or
more amendments thereto, including each related prospectus, each of which
has previously been furnished to the Representatives. Such Registration
Statement has been declared effective under the Act. The Company has
filed with the Commission a preliminary prospectus supplement specifically
relating to the Shares pursuant to Rule 424 under the Act and has filed
with, or transmitted for filing to, or shall promptly hereafter file with
or transmit for filing to, the Commission a prospectus supplement (the
"Prospectus Supplement") specifically relating to the Shares pursuant to
Rule 424 under the Act. The Company has included or will include in such
Registration Statement, as amended at the Effective Date, and in the
Prospectus Supplement all information required by the Act and the rules
thereunder to be included therein with respect to the Shares and the
offering thereof. As filed, such Registration Statement, as so amended,
and form of final prospectus contained in the Registration Statement and
Prospectus Supplement, or such final prospectus and Prospectus Supplement,
contains or will contain all required information with respect to the
Shares and the offering thereof and, except to the extent the
Representatives shall agree in writing to a modification, shall be in all
substantive respects in the form furnished to the Underwriters prior to
the Execution Time or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other changes
(beyond that contained in the latest Preliminary Prospectus and
accompanying Prospectus) as the Company has advised the Representatives,
prior to the Execution Time, will be included or made therein.
(b) On the Effective Date, the Registration Statement did or
will, and when the Prospectus and the Prospectus Supplement is first filed
in accordance with Rule 424(b) and on the Closing Date, the Prospectus
(and any supplements thereto) will, comply in all material respects with
the requirements of the Act and the rules thereunder; on the Effective
Date, the Registration Statement did not or will not contain any untrue
statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein
not misleading; and, on the date of any filing pursuant to Rule 424(b) and
on the Closing Date, the Prospectus (together with any supplement thereto)
will not include any untrue statement of a material fact or omit to state
a material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading;
provided, however, that the Company makes no representations or warranties
as to the information contained in or omitted from the Registration
Statement or the Prospectus (or any supplement thereto) in reliance upon
and in conformity with information furnished in writing to the Company by
or on behalf of any Underwriter through the Representatives specifically
for inclusion in the Registration Statement or the Prospectus (or any
supplement thereto).
(c) No stop order suspending the effectiveness of the
Registration Statement is in effect and no proceedings for such purpose
are, to the knowledge of the Company, pending before or threatened by the
Commission.
(d) Each of the Incorporated Documents complied, as of the
date such Incorporated Document was filed (or, if any amendment with
respect to any such document was filed, when such amendment was filed), in
all material respects with the requirements of the Securities Exchange Act
of 1934, as amended (the "Exchange Act"), and the rules and regulations
thereunder.
(e) Each of the Company, SEI Arlington Acquisition
Corporation ("SEI Arlington"), SEI Hypoluxo Acquisition Corporation
("Hypoluxo"), Arlington Acquisition Co. ("Arlington"), Hargrove Road
Development Corporation ("Hargrove") and Boswell Road Development
Corporation ("Boswell" and, together with SEI Arlington, Hypoluxo,
Arlington and Hargrove, the "Subsidiaries") and PS Partners, Ltd.
("PSPI"), PS Partners II, Ltd. ("PSPII"), PS Partners III, Ltd.
("PSPIII"), PS Partners IV, Ltd. ("PSPIV"), PS Partners V, Ltd. ("PSPV"),
PS Partners VI, Ltd. ("PSPVI"), PS Partners VII, Ltd. ("PSPVII") and PS
Partners VIII, Ltd. ("PSPVIII" and, collectively, the "Partnerships") has
been duly organized and is validly existing (in the case of the Company
and each of the Subsidiaries, as a corporation) in good standing under the
laws of the jurisdiction in which it is organized, with full power and
authority to own or lease and occupy its properties and conduct its
business as described in the Prospectus, and is duly qualified to do
business, and is in good standing, in each jurisdiction which requires
such qualification, except where the failure to so qualify would not,
individually or in the aggregate, have a material adverse effect on the
business, operations, earnings, assets or financial condition of the
Company (a "Material Adverse Effect"). All of the outstanding shares of
capital stock of each of the Subsidiaries have been duly authorized and
validly issued, are fully paid and nonassessable, and are owned by the
Company directly, or indirectly through another Subsidiary, free and clear
of any lien, adverse claim, security interest, equity, or other
encumbrance. The Company owns as of March 31, 1995 approximately 51%,
66%, 49%, 33%, 43%, 34%, 51% and 39% of the limited partnership units of
PSPI, PSPII, PSPIII, PSPIV, PSPV, PSPVI, PSPVII and PSPVIII, respectively.
(f) The Company, each of the Subsidiaries and each
Partnership have all requisite power and authority, and all necessary
material authorizations, approvals, orders, licenses, certificates and
permits of and from all regulatory or governmental officials, bodies and
tribunals, to own or lease their respective properties and to conduct
their respective businesses as now being conducted and as described in the
Prospectus; all such authorizations, approvals, licenses, certificates and
permits are in full force and effect, except where the failure to be in
full force and effect would not have a Material Adverse Effect on the
Company, such Subsidiary or such Partnership and; the Company, each of the
Subsidiaries and each Partnership are complying with all applicable laws,
the violation of which could have a Material Adverse Effect on the
Company, such Subsidiary or such Partnership, as the case may be.
(g) The Company, each Subsidiary and each Partnership have
good and marketable title to their properties, free and clear of all
material liens, charges and encumbrances and equities of record, except as
set forth or reflected in the Prospectus.
(h) The Company, each Subsidiary and each Partnership
maintain adequate insurance for the conduct of their respective business
as described in the Prospectus.
(i) The Company, either directly or through the Subsidiaries
or Partnerships, owns or licenses or otherwise has the right to use all
patents, trademarks, trade names and trade secrets material to the
Company's business as described in the Prospectus; other than routine
proceedings which if adversely determined would not materially affect the
business (as described in the Prospectus) of the Company, the Subsidiaries
and the Partnerships taken as a whole, no claims have been asserted by any
person with respect to the use of any such patents, trademarks, trade
names and trade secrets or challenging or questioning the validity or
effectiveness of any such patents, trademarks, trade names or trade
secrets; to the best knowledge of the Company, the use, in connection with
the business and operations of the Company, the Subsidiaries and the
Partnerships, of such patents, trademarks and trade names does not
infringe on the rights of any person.
(j) The Company's authorized capitalization is as set forth
in the Prospectus; the capital stock of the Company conforms in all
material respects to the description thereof contained in the Prospectus;
the outstanding shares of common stock, par value $.10 per share, of the
Company (the "Common Stock"), Series A Preferred Stock, par value $.01 per
share, of the Company (the "Series A Preferred Stock"), Series B Preferred
Stock, par value $.01 per share, of the Company (the "Series B Preferred
Stock"), Adjustable Rate Cumulative Preferred Stock, Series C, stated
value $25.00 per share, of the Company (the "Series C Preferred Stock"),
9.50% Cumulative Preferred Stock, Series D, stated value $25.00 per share,
of the Company (the "Series D Preferred Stock"), 10% Cumulative Preferred
Stock, Series E, stated value $25.00 per share, of the Company (the
"Series E Preferred Stock") and 8.25% Convertible Preferred Stock, stated
value $25.00 per share, of the Company (the "Convertible Preferred Stock")
have each been duly and validly authorized and issued and are fully paid
and nonassessable; the Shares have been duly and validly authorized and,
when issued and delivered pursuant to this Agreement, will be fully paid
and nonassessable; the Shares have been duly authorized for listing on the
New York Stock Exchange, subject to official notice of issuance; prior to
the Closing Date, the form of certificate for the Shares will be in valid
and sufficient form in compliance with New York Stock Exchange
requirements; and the holders of outstanding shares of capital stock of
the Company are not entitled to preemptive or other rights to subscribe
for the Shares.
(k) There is no pending or, to the best knowledge of the
Company, after due inquiry, threatened, action, suit, proceeding or
investigation before any court, governmental agency, authority or body or
arbitrator involving the Company, any of the Subsidiaries or any of the
Partnerships of a character required to be disclosed in the Registration
Statement or Prospectus which is not adequately disclosed in the
Prospectus, and there is no franchise, contract or other document of a
character required to be described in the Registration Statement or
Prospectus, or to be filed as an exhibit, which is not described or filed
as required.
(l) The Company has full corporate power and authority to
enter into and perform its obligations under this Agreement and to issue,
sell and deliver the Shares; and this Agreement has been duly authorized,
executed and delivered by the Company.
(m) No consent, approval, authorization or order of any court
or governmental agency, authority or body is required (and has not been
received) for the execution by the Company of this Agreement, the
performance by the Company of its obligations hereunder or the
consummation by the Company of the transactions contemplated herein,
except such as are required under the state securities or the Blue Sky
laws of any jurisdiction in connection with the purchase and distribution
of the Shares by the Underwriters. Neither the Company nor any of its
affiliates is presently doing any business with the government of Cuba or
with any person or affiliate located in Cuba.
(n) Neither the Company nor any of the Subsidiaries is in
violation of, in conflict with, in breach of or in default under (and none
of them know of an event which with the giving of notice or the lapse of
time or both would be reasonably likely to constitute a default under) its
charter or by-laws, and none of the Partnerships is in violation of its
respective partnership agreement (and none of them know of an event which
with the giving of notice or the lapse of time or both would be reasonably
likely to constitute a violation), and neither the Company, any Subsidiary
nor any Partnership is in default in the performance of any obligation,
agreement or condition contained in any loan, note or other evidence of
indebtedness or in any indenture, mortgage, deed of trust or any other
material agreement by which it or they or its or their properties are
bound, except for such defaults as could not, individually or in the
aggregate, have a Material Adverse Effect on the Company, such Subsidiary
or such Partnership, as the case may be.
(o) Neither the Company, any of the Subsidiaries nor any of
the Partnerships has violated any environmental, safety or similar law or
regulation applicable to its business relating to the protection of human
health and safety, the environment or hazardous or toxic substances or
wastes, pollutants or contaminants, nor has the Company, any of the
Subsidiaries nor any of the Partnerships violated any Federal, state or
local law relating to discrimination in the hiring, promotion or pay of
employees nor any applicable wage or hour laws, nor has the Company or any
of the Partnerships engaged in any unfair labor practice, which in each
case could reasonably be expected, individually or in the aggregate, to
have a Material Adverse Effect on the Company, such Subsidiary or such
Partnership, as the case may be.
(p) Neither the issue and sale of the Shares nor the
consummation of any of the other transactions herein contemplated nor the
fulfillment of the terms hereof will conflict with, result in a breach or
violation of, or constitute a default under any law or the charter or
bylaws of the Company or any of the Subsidiaries or the terms of any
indenture or other agreement or instrument to which the Company, any of
the Subsidiaries or any of the Partnerships is a party or is bound or any
judgment, order or decree applicable to the Company, any of the
Subsidiaries or any of the Partnerships of any court, regulatory body,
administrative agency, governmental body or arbitrator having jurisdiction
over the Company, any of the Subsidiaries or any of the Partnerships.
(q) The Company has fulfilled its obligations, if any, under
the minimum funding standards of Section 302 of the United States Employee
Retirement Income Security Act of 1974 ("ERISA") and the regulations and
published interpretations thereunder with respect to each "pension plan"
(as defined in ERISA and such regulations and published interpretations)
in which employees of the Company are eligible to participate and each
such plan is in compliance in all material respects with the presently
applicable provisions of ERISA and such regulations and published
interpretations (except for such failure to so comply that would not have,
singularly or in the aggregate with all other such failures to comply, a
Material Adverse Effect), and has not incurred any unpaid liability to the
Pension Benefit Guaranty Corporation (other than for the payment of
premiums in the ordinary course) or to any such plan under Title IV of
ERISA.
(r) Other than as described in the Prospectus (including the
Incorporated Documents), there are no outstanding warrants or options to
purchase any shares of capital stock of the Company and there are no
restrictions upon the voting or transfer of, or the declaration or payment
of any dividend or distribution on, any shares of capital stock of the
Company pursuant to the articles of incorporation or bylaws of the
Company, any agreement or other instrument to which the Company is a party
or by which the Company is bound, or any order, law, rule, regulation or
determination of any court, governmental agency or body (including,
without limitation, any banking or insurance regulatory agency or body),
or arbitrator having jurisdiction over the Company. No holders of
securities of the Company have rights to the registration of such
securities under the Registration Statement.
(s) The Company is qualified, has been qualified since
January 1, 1981, has been operating, since the beginning of the current
fiscal year, in a manner that would continue to permit it to be qualified,
and intends to operate so as to continue to be qualified, (i) as a REIT
under Section 856 et seq. of the Internal Revenue Code of 1986, as amended
(the "Code"), and (ii) to be taxed on its "real estate investment trust
income" pursuant to Section 857 of the Code.
(t) No statement, representation, warranty or covenant made
by the Company in this Agreement or made in any certificate or document
required by this Agreement to be delivered to the Representatives is, or
will be, when made, inaccurate, untrue or incorrect in any material
respect.
(u) Neither the Company nor any of its officers, directors,
or controlling persons has taken, directly or indirectly, any action
intended, or which might reasonably be expected, to cause or result, under
the Act or otherwise, in, or which has constituted, stabilization or
manipulation of the price of any security of the Company to facilitate the
sale or resale of the Shares in violation of the Act.
(v) To the best of the Company's knowledge, the firm of
accountants that have certified or shall certify the applicable
consolidated financial statements and supporting schedules of the Company
filed or to be filed with the Commission as part of (or incorporated by
reference in) the Registration Statement and the Prospectus are
independent public accountants with respect to the Company, as required by
the Act. The consolidated financial statements, together with related
schedules and notes, incorporated by reference in the Prospectus and the
Registration Statement comply as to form in all material respects with the
requirements of the Act. Such financial statements fairly present the
consolidated financial position of the Company, the Subsidiaries and the
Partnerships at the respective dates indicated and the results of their
operations and their cash flows for the respective periods indicated, and
have been prepared in accordance with generally accepted accounting
principles, except as otherwise expressly stated therein, as consistently
applied throughout such periods. The other financial and statistical
information and data included in the Prospectus and in the Registration
Statement are, in all material respects, accurately presented and prepared
on a basis consistent with applicable financial statements and the books
and records of the Company, the Subsidiaries and the Partnerships or, with
respect to information and data relating to persons other than the
Company, the Subsidiaries and the Partnerships, other information
available to the Company.
(w) Except as disclosed in the Registration Statement and the
Prospectus (or any amendment or supplement thereto), subsequent to the
respective dates as of which such information is given in the Registration
Statement and the Prospectus (or any amendment or supplement thereto),
neither the Company, any of the Subsidiaries nor any of the Partnerships
has incurred any liability or obligation, direct or contingent, or entered
into any transaction, not in the ordinary course of business, that is
material to the Company, the Subsidiaries and the Partnerships taken as a
whole, and there has not been any material change in the capital stock, or
material increase in the short-term debt or long-term debt, of the
Company, any Subsidiary or any of the Partnerships, or any material
adverse change, or any development which may reasonably be expected to
involve a prospective material adverse change, in the condition (financial
or other), business, net worth or results of operations of the Company,
the Subsidiaries and the Partnerships taken as a whole.
(x) The Company has not distributed and, prior to the later
to occur of (i) the Closing Date and (ii) completion of the distribution
of the Shares, will not distribute any offering material in connection
with the offering and sale of the Shares other than the Registration
Statement, the Prospectus or other materials, if any, permitted by the
Act.
(y) The Company maintains a system of internal accounting
controls sufficient to provide reasonable assurances that in all material
respects (i) transactions are executed in accordance with management's
general or specific authorization; (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain accountability
for assets; (iii) access to assets is permitted only in accordance with
management's general or specific authorization; and (iv) the recorded
accountability for assets is compared with existing assets at reasonable
intervals and appropriate action is taken with respect to any differences.
(z) To the Company's knowledge, neither the Company, any of
its Subsidiaries nor any of the Partnerships nor any employee or agent of
the Company, any Partnership, any Subsidiary, or any Partnership has made
any payment of funds of the Company, any Partnership or any Subsidiary or
received or retained any funds in violation of any law, rule or
regulation, which payment, receipt or retention of funds is of a character
required to be disclosed in the Prospectus.
(aa) The Company, each of the Subsidiaries and each of the
Partnerships have filed all tax returns required to be filed (except to
the extent extensions have been timely filed related thereto), which
returns are complete and correct in all material respects, and neither the
Company, any Partnership nor any Subsidiary is in default in the payment
of any taxes which were payable pursuant to said returns or any
assessments with respect thereto.
(ab) The terms which follow, when used in this Agreement,
shall have the meanings indicated. The term "the Effective Date" shall
mean each date that the Registration Statement and any post-effective
amendment or amendments thereto became or become effective. "Execution
Time" shall mean the date and time that this Agreement is executed and
delivered by the parties hereto. "Preliminary Prospectus" shall mean any
preliminary prospectus supplement referred to in paragraph (a) above.
"Prospectus" shall mean the prospectus and Prospectus Supplement relating
to the Shares that is first filed pursuant to Rule 424(b) after the
Execution Time. "Registration Statement" shall mean the registration
statement referred to in paragraph (a) above, including exhibits and
financial statements, as amended at the Execution Time and, in the event
any post-effective amendment thereto becomes effective prior to the
Closing Date, shall also mean such registration statement as so amended.
"Rule 424" refers to such rule under the Act. Any reference herein to the
Registration Statement, a Preliminary Prospectus or the Prospectus shall
be deemed to refer to and include the documents incorporated by reference
therein pursuant to Item 12 of Form S-3 which were filed under the
Exchange Act on or before the Effective Date of the Registration Statement
or the issue date of such Preliminary Prospectus or the Prospectus, as the
case may be (collectively, the "Incorporated Documents"); and any
reference herein to the terms "amend," "amendment" or "supplement" with
respect to the Registration Statement, any Preliminary Prospectus or the
Prospectus shall be deemed to refer to and include the filing of any
document under the Exchange Act after the Effective Date of the
Registration Statement, or the issue date of any Preliminary Prospectus or
the Prospectus, as the case may be, deemed to be incorporated therein by
reference.
5. Agreements of the Company. The Company agrees with the
Underwriters as follows:
(a) The Company will not, either prior to the Effective Date
or thereafter during such period as the Prospectus is required by law to
be delivered in connection with sales of the Shares by any Underwriter or
any dealer, file any amendment or supplement to the Registration Statement
or the Prospectus, unless a copy thereof shall first have been submitted
to the Representatives within a reasonable period of time prior to the
filing thereof and the Representatives shall not have objected thereto in
good faith.
(b) The Company will use its best efforts to cause any
post-effective amendment to the Registration Statement to become
effective, and will notify the Representatives promptly, and will confirm
such advice in writing, (1) when any post-effective amendment to the
Registration Statement becomes effective, (2) of any request by the
Commission for amendments or supplements to the Registration Statement or
the Prospectus or for additional information, (3) of the issuance by the
Commission of any stop order suspending the effectiveness of the
Registration Statement or the initiation of any proceedings for that
purpose or the threat thereof, (4) of the happening of any event during
the period mentioned in the second sentence of Section 5(e) that in the
judgment of the Company makes any statement made in the Registration
Statement or the Prospectus untrue or that requires the making of any
changes in the Registration Statement or the Prospectus in order to make
the statements therein, in light of the circumstances in which they are
made, not misleading, and (5) of receipt by the Company or any
representative or attorney of the Company of any other communication from
the Commission relating to the Company, the Registration Statement, any
preliminary prospectus or the Prospectus. If at any time the Commission
shall issue any order suspending the effectiveness of the Registration
Statement, the Company will make every reasonable effort to obtain the
withdrawal of such order at the earliest possible moment.
(c) The Company will furnish to the Representatives, without
charge, four signed copies of the Registration Statement and of any
post-effective amendment thereto, including financial statements and
schedules, and all exhibits thereto (including any document filed under
the Exchange Act and deemed to be incorporated by reference into the
Prospectus) and will furnish to the Representatives, without charge, for
transmittal to each of the other Underwriters, copies of the Registration
Statement and any post-effective amendment thereto, including financial
statements and schedules but without exhibits.
(d) The Company will comply with all the provisions of any
undertakings contained in the Registration Statement.
(e) The Company will deliver to each of the Underwriters,
without charge, as many copies of the Prospectus or any amendment or
supplement thereto as the Representatives may reasonably request. The
Company consents to the use of the Prospectus or any amendment or
supplement thereto by the several Underwriters and by all dealers to whom
the Shares may be sold, both in connection with the offering or sale of
the Shares and for any period of time thereafter during which the
Prospectus is required by law to be delivered in connection therewith. If
during such period of time any event shall occur which in the judgment of
the Company or counsel to the Underwriters should be set forth in the
Prospectus in order to make any statement therein, in the light of the
circumstances under which it was made, not misleading, or if it is
necessary to supplement or amend the Prospectus to comply with law,
subject to the provisions of Section 5(a) hereof, the Company will
forthwith prepare and duly file with the Commission an appropriate
supplement or amendment thereto, and will deliver to the Underwriters,
without charge, such number of copies thereof as the Representatives may
reasonably request. The Company shall not file any document under the
Exchange Act before the termination of the offering of the Shares by the
Underwriters if such document would be deemed to be incorporated by
reference into the Prospectus which is not approved by the Representatives
after reasonable notice thereof.
(f) Prior to any public offering of the Shares by the
Underwriters, the Company will cooperate with the Representatives and
counsel to the Underwriters in connection with the registration or
qualification of the Shares for offer and sale under the securities or
Blue Sky laws of such jurisdictions as the Representatives may reasonably
request; provided, that in no event shall the Company be obligated to
qualify to do business in any jurisdiction where it is not now so
qualified or to take any action which would subject it to general service
of process in any jurisdiction where it is not now so subject. The
Company will inform the Florida Department of Banking and Finance if, at
any time prior to the completion of the distribution of the Shares by the
Underwriters, it commences engaging in business with the government of
Cuba or with any person or affiliate located in Cuba. Such information
will be proved within 90 days after the commencement thereof or after a
change occurs with respect to previously reported information.
(g) During the period of five years commencing on the
Effective Date, the Company will furnish to each of the Representatives
and each other Underwriter who may so request copies of such financial
statements and other periodic and special reports as the Company may from
time to time distribute generally to the holders of any class of its
capital stock, and will furnish to each of the Representatives and each
other Underwriter who may so request a copy of each annual or other report
it shall be required to file with the Commission.
(h) The Company will make generally available to holders of
its securities as soon as may be practicable but in no event later than
the last day of the fifteenth full calendar month following the calendar
quarter in which the Effective Date falls, an earnings statement (which
need not be audited but shall be in reasonable detail), with respect to
the Company, the Subsidiaries and the Partnerships, for a period of 12
months commencing after the Effective Date of the Registration Statement,
and satisfying the provisions of Section 11(a) of the Act (including Rule
158 thereunder) and will file such earnings statement as an exhibit to the
next periodic report required by Section 13 or 15(d) of the Exchange Act
covering the period when the earnings statement is released.
(i) If this Agreement shall terminate or shall be terminated
after execution pursuant to any provisions hereof (otherwise than pursuant
to the second paragraph of Section 9 hereof or by notice given by you
terminating this Agreement pursuant to Section 9 or Section 10 hereof) or
if this Agreement shall be terminated by the Underwriters because of any
failure or refusal on the part of the Company to comply with the terms or
fulfill any of the conditions of this Agreement, the Company agrees to
reimburse the Representatives for all out-of-pocket expenses (including
fees and expenses of counsel for the Underwriters) reasonably incurred by
you in connection herewith.
(j) The Company will not at any time, directly or indirectly,
take any action intended, or which might reasonably be expected, to cause
or result in, or which will constitute, stabilization of the price of the
Shares to facilitate the sale or resale of any of the Shares in violation
of the Act.
(k) The Company will apply the net proceeds from the offering
and sale of the Shares to be sold by the Company in the manner set forth
in the Prospectus under "Use of Proceeds."
(l) The Company will use its best efforts to have the Shares
listed, subject to notice of issuance, on the New York Stock Exchange.
6. Conditions of Underwriters' Obligations. The several
obligations of each Underwriter to purchase the Firm Shares hereunder are
subject to the following conditions:
(a) If, at the time this Agreement is executed and delivered,
it is necessary for a post-effective amendment to the Registration
Statement to be declared effective before the offering of the Shares may
commence, such post-effective amendment shall have become effective not
later than 5:30 P.M., New York City time, on the date hereof, or at such
later date and time as shall be consented to in writing by the
Representatives, and all filings, if any, required by Rules 424 and 430A
under the Act shall have been timely made; no stop order suspending the
effectiveness of the Registration Statement shall have been issued and no
proceeding for that purpose shall have been instituted or, to the
knowledge of the Company or any Underwriter, threatened by the Commission,
and any request of the Commission for additional information (to be
included in the Registration Statement or the Prospectus or otherwise)
shall have been complied with to the satisfaction of the Representatives.
(b) Subsequent to the effective date of this Agreement, there
shall not have occurred (i) any change, or any development involving a
prospective change, in or affecting the condition (financial or other),
business, properties, net worth, or results of operations of the Company,
the Subsidiaries or the Partnerships not contemplated by the Prospectus,
which in your opinion, as Representatives of the several Underwriters,
would materially, adversely affect the market for the Shares, or (ii) any
event or development relating to or involving the Company or any officer
or director of the Company which makes any statement made in the
Prospectus untrue in any material respect or which, in the opinion of the
Company and its counsel or the Underwriters and their counsel, requires
the making of any addition to or change in the Prospectus in order to
state a material fact required by the Act or any other law to be stated
therein or necessary in order to make the statements therein not
misleading, if amending or supplementing the Prospectus to reflect such
event or development would, in your opinion, as Representatives of the
several Underwriters, adversely affect the market for the Shares.
(c) The Underwriters shall have received an opinion, dated
the Closing Date and, with respect to the Additional Shares, the Option
Closing Date, and satisfactory in form and substance to counsel for the
Underwriters, from David Goldberg, counsel for the Company, to the effect
that:
(i) Each of the Company, the Subsidiaries and the
Partnerships has been duly organized and is validly existing
(in the case of the Company and each of the Subsidiaries, as a
corporation) in good standing under the laws of the
jurisdiction in which it is organized, with full power and
authority to own or lease and occupy its properties and
conduct its business as described in the Prospectus, and is
duly qualified to do business, and is in good standing, in
each jurisdiction which requires such qualification, except
where the failure to so qualify would not, individually or in
the aggregate, have a Material Adverse Effect;
(ii) All of the Company's ownership interests in
the Partnerships are owned free and clear of any perfected
security interest and, to my knowledge, after due inquiry, any
other security interests, claims, liens or encumbrances;
(iii) The Company's authorized equity
capitalization is as set forth in the Prospectus; the capital
stock of the Company conforms to the description thereof
contained in the Prospectus; the outstanding shares of Common
Stock, Series A Preferred Stock, Series B Preferred Stock,
Series C Preferred Stock, Series D Preferred Stock, Series E
Preferred Stock and Convertible Preferred Stock have been duly
and validly authorized and issued and are fully paid and
nonassessable; the Shares have been duly and validly
authorized, and, when issued and delivered to and paid for by
the Underwriters pursuant to the Agreement, will be fully paid
and nonassessable; the Shares have been duly authorized for
listing, subject to official notice of issuance, on the New
York Stock Exchange; the form of certificate for the Shares is
in valid and sufficient form in compliance with New York Stock
Exchange requirements; and the holders of outstanding shares
of capital stock of the Company are not entitled to preemptive
or other rights to subscribe for the Shares;
(iv) To the best of my knowledge, after due
inquiry, there is no pending or threatened action, suit or
proceeding before any court or governmental agency, authority
or body or arbitrator involving the Company, any of the
Subsidiaries or any of the Partnerships of a character
required to be disclosed in the Registration Statement which
is not adequately disclosed in the Prospectus, and there is no
franchise, contract or other document of a character required
to be described in the Registration Statement or Prospectus,
or to be filed as an exhibit, which is not described or filed
as required; and, to the best of my knowledge, after due
inquiry, the statements in the Company's Annual Report on Form
10-K for the fiscal year ended December 31, 1994, under Part
II, Item 7 - "Management's Discussion and Analysis of
Financial Condition and Results of Operations - REIT
Distribution Requirement" and Part III, Item 13 - "Certain
Relationships and Related Party Transactions" (other than the
financial statements and other financial and statistical
information contained therein, as to which I express no
opinion) fairly summarize the matters therein described in all
material respects;
(v) The Registration Statement and the Prospectus
and any amendment or supplement thereto comply as to form in
all material respects with the requirements for the use of
Form S-3 and the rules and regulations thereunder, and the
Registration Statement and the Prospectus and any amendment or
supplement thereto (other than the financial statements and
other financial information contained therein, as to which
such counsel need express no opinion) comply as to form in all
material respects with the requirements of the Act and the
rules thereunder and each of the Incorporated Documents (or,
if any amendment with respect to any such document was filed,
when such document was filed), complied as to form in all
material respects with the requirements of the Exchange Act
and the rules thereunder (other than the financial statements
and other financial information contained therein, as to which
such counsel need express no opinion);
(vi) The Company has full corporate power and
authority to enter into and perform its obligations under the
Agreement and to issue, sell and deliver the Shares; and the
Agreement has been duly authorized, executed and delivered by
the Company;
(vii) No consent, approval, authorization or
order of any court or governmental agency, authority or body
is required for the execution by the Company of the Agreement,
the performance by the Company of its obligations thereunder
or the consummation of the transactions contemplated therein,
except such as have been obtained under the Act and the
Exchange Act and such as may be required under the Blue Sky
laws of any jurisdiction in connection with the purchase and
distribution by the Underwriters of the Shares;
(viii) The Company, each Subsidiary and each
Partnership have all requisite power and authority, and, to
the best knowledge of such counsel, after due inquiry, all
necessary material authorizations, approvals, orders,
licenses, certificates and permits of and from all regulatory
or governmental officials, bodies and tribunals, to own or
lease their respective properties and to conduct their
respective businesses as now being conducted and as described
in the Prospectus; and, to the best of my knowledge, after due
inquiry, all such authorizations, approvals, licenses,
certificates and permits are in full force and effect, except
where the failure to be in full force and effect would not
have a Material Adverse Effect on the Company, such Subsidiary
or such Partnership, and the Company, each Subsidiary and each
Partnership are complying with all applicable laws, the
violation of which could have a Material Adverse Effect on the
Company, such Subsidiary or such Partnership, as the case may
be;
(ix) The Company and each of the Subsidiaries are
not in violation of its articles of incorporation or bylaws,
and each of the Partnerships is not in violation of its
respective partnership agreement, and to the best of my
knowledge, after due inquiry, neither the Company, the
Subsidiaries nor any Partnership is in default in the
performance of any obligation, agreement or condition
contained in any loan, note or other evidence of indebtedness
or in any indenture, mortgage, deed of trust or any other
material agreement by which it or they or its or their
properties are bound, except for such defaults as could not,
individually or the aggregate, have a Material Adverse Effect
on the Company, such Subsidiary or such Partnership, as the
case may be;
(x) Neither the issue and sale of the Shares, nor
the consummation of any other of the transactions contemplated
by the Agreement nor the fulfillment of the terms of the
Agreement will conflict with, result in a breach or violation
of, or constitute a default under any law or the articles of
incorporation or by-laws of the Company or the Subsidiaries or
the terms of any indenture or other agreement or instrument
known to me and to which the Company, any of the Subsidiaries
or any of the Partnerships is a party or is bound or any
judgment, order or decree known to me to be applicable to the
Company, any of the Subsidiaries or any of the Partnerships of
any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over the
Company, any of the Subsidiaries or any of the Partnerships;
(xi) No holders of securities of the Company have
rights to the registration of such securities under the
Registration Statement;
(xii) Any required filing of the Prospectus, and
any supplements thereto, pursuant to Rule 424(b) has been made
in the manner and within the time period required by Rule
424(b); and to the best of my knowledge, no stop order
suspending the effectiveness of the Registration Statement has
been issued and no proceedings for that purpose have been
instituted or threatened;
(xiii) To the best of such counsel's knowledge,
after reasonable inquiry, neither the Company, any of the
Subsidiaries nor any of the Partnerships is in violation of
any law, ordinance, administrative or governmental rule or
regulation applicable to the Company, any of the Subsidiaries
or any of the Partnerships or of any decree of any court or
governmental agency or body having jurisdiction over the
Company, any of the Subsidiaries or any of the Partnerships,
the violation of which could have a Material Adverse Effect on
the Company, such Subsidiary or such Partnership, as the case
may be;
(xiv) The statements in the Registration
Statement and Prospectus, insofar as they are descriptions of
contracts, agreements or other legal documents, or refer to
statements of law or legal conclusions, are accurate and
present fairly the information required to be shown in all
material respects;
(xv) The Company, the Subsidiaries and the
Partnerships own or have the right to use all patents,
trademarks, trademark registrations, service marks, service
mark registrations, trade names, copyrights, licenses,
inventions, trade secrets and rights described in the
Prospectus as being owned by them or any of them or necessary
for the conduct of their respective businesses, and, other
than routine proceedings which if adversely determined would
not materially affect the business of the Company, the
Subsidiaries and the Partnerships taken as a whole as
described in the Prospectus, such counsel is not aware of any
claim to the contrary or any challenge by any other person to
the rights of the Company, the Subsidiaries and the
Partnerships with respect to the foregoing;
(xvi) Except as described in the Prospectus and
in Section 4(r) hereof, to the best of such counsel's
knowledge, after reasonable inquiry, there are no outstanding
options, warrants or other rights calling for the issuance of,
and such counsel does not know of any commitment, plan or
arrangement to issue, any shares of capital stock of the
Company or any security convertible into or exchangeable or
exercisable for capital stock of the Company;
(xvii) Except as described in the Prospectus and
in Section 4(r) hereof, to the best of such counsel's
knowledge, after reasonable inquiry, there is no holder of any
security of the Company or any other person who has the right,
contractual or otherwise, to cause the Company to sell or
otherwise issue to them, or to permit them to underwrite the
sale of, the Shares or the right to have any Common Stock or
other securities of the Company included in the Registration
Statement or the right, as a result of the filing of the
Registration Statement, to require registration under the Act
of any shares of Common Stock or other securities of the
Company;
In addition, such counsel shall state that he has participated
in conferences with representatives of the Underwriters, and with officers
and other representatives of the Company and representatives of the
independent certified public accountants of the Company, at which
conferences the contents of the Registration Statement and the Prospectus
and related matters were discussed and, although such counsel does not
pass upon and does not assume any responsibility for the accuracy,
completeness or fairness of the statements contained in the Registration
Statement and the Prospectus, on the basis of the foregoing (relying as to
certain factual matters on the information provided to such counsel by the
Company and not on an independent investigation, but in the absence of
information to the contrary), no facts have come to such counsel's
attention which leads such counsel to believe that the Registration
Statement, as of its effective date, contained an untrue statement of a
material fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading, or
that the Prospectus, as of its date and as of the date hereof, contained
an untrue statement of a material fact or omitted to state a material fact
necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided that
such counsel need not express any comment with respect to the financial
statements and other financial data included in the Registration Statement
or Prospectus.
(d) The Underwriters shall have received an opinion, dated
the Closing Date and, with respect to the Additional Shares, the Option
Closing Date, and satisfactory in form and substance to counsel for the
Underwriters, from Hogan & Hartson, counsel for the Company, to the effect
that:
(i) The statements in the Prospectus under the
heading "Certain Federal Income Tax Considerations" fairly
summarize the federal income tax considerations likely to be
material to a holder of the Shares.
(ii) Based upon current law, including relevant
statutes, regulations and judicial and administrative
precedent (which law is subject to change on a retroactive
basis), and subject to the limitations and qualifications set
forth in our tax opinion filed as Exhibit 8.1 to the
Registration Statement, the Company has operated in a manner
that qualified it as a REIT under the Code, for its taxable
years ended December 31, 1990, December 31, 1991, December 31,
1992, December 31, 1993, and December 31, 1994, and if it
operates subsequent to December 31, 1994 in the same manner as
it has prior to that date, it will continue to so qualify.
You may rely upon our tax opinion filed as Exhibit 8.1 to the
Registration Statement to the same extent as if it were set
forth in full herein.
(e) The Underwriters shall have received an opinion, dated
the Closing Date and, with respect to the Additional Shares, the Option
Closing Date, from Skadden, Arps, Slate, Meagher & Flom, counsel to the
Underwriters, with respect to the Registration Statement, the Prospectus
and this Agreement, which opinion shall be satisfactory in all respects to
the Representatives, and such counsel shall have been provided by the
Company with such documents and information as they may reasonably request
to enable them to pass on such matters.
(f) You shall have received letters addressed to you, as
Representatives of the several Underwriters, and dated the date hereof and
the Closing Date from Ernst & Young, independent certified public
accountants, substantially in the forms heretofore approved by you.
(g) (i) No stop order suspending the effectiveness of the
Registration Statement shall have been issued and no proceedings for that
purpose shall have been taken or, to the knowledge of the Company, shall
be contemplated by the Commission at or prior to the Closing Date; (ii)
there shall not have been any material change in the capital stock of the
Company nor any material increase in the short-term or long-term debt of
the Company (other than in the ordinary course of business) from that set
forth or contemplated in the Registration Statement or the Prospectus (or
any amendment or Supplement thereto); (iii) there shall not have been,
since the respective dates as of which information is given in the
Registration Statement and the Prospectus (or any amendment or supplement
thereto), except as may otherwise be stated in the Registration Statement
and Prospectus (or any amendment or supplement thereto), any material
adverse change in the condition (financial or other), business, prospects,
properties, net worth or results of operations of the Company, the
Subsidiaries and the Partnerships taken as a whole; (iv) the Company, the
Subsidiaries and the Partnerships shall not have any liabilities or
obligations, direct or contingent (whether or not in the ordinary course
of business), that are material to the Company, the Subsidiaries, and the
Partnerships, taken as a whole, other than those reflected in the
Registration Statement or the Prospectus (or any amendment or supplement
thereto); and (v) all the representations and warranties of the Company
contained in this Agreement shall be true and correct in all material
respects on and as of the date hereof and on and as of the Closing Date as
if made on and as of the Closing Date, and you shall have received a
certificate, dated the Closing Date and signed by the chief executive
officer and the chief financial officer of the Company (or such other
officers as are acceptable to you), to the effect set forth in this
Section 6(g) and in Section 6(h) hereof.
(h) The Company shall not have failed at or prior to the
Closing Date to have performed or complied with any of its agreements
herein contained and required to be performed or complied with by it
hereunder at or prior to the Closing Date.
(i) Prior to the Closing Date the Shares shall have been
listed, subject to notice of issuance, on the New York Stock Exchange.
(j) The Company shall have furnished or caused to be
furnished to you such further certificates and documents as you shall have
requested.
All such opinions, certificates, letters and other documents
will be in compliance with the provisions hereof only if they are
satisfactory in form and substance to you and your counsel.
Any certificate or document signed by any officer of the
Company and delivered to you, as Representatives of the Underwriters, or
to counsel for the Underwriters, shall be deemed a representation and
warranty by the Company to each Underwriter as to the statements made
therein.
The several obligations of the Underwriters to purchase
Additional Shares hereunder are subject to the satisfaction on and as of
any Option Closing Date of the conditions set forth in this Section 6,
except that, if any Option Closing Date is other than the Closing Date,
the certificates, opinions and letters referred to in paragraphs (c)
through (g) shall be dated the Option Closing Date in question and the
opinions called for by paragraphs (c), (d) and (e) shall be revised to
reflect the sale of Additional Shares.
7. Indemnification and Contribution.
(a) The Company agrees to indemnify and hold harmless each of
you and each other Underwriter and each person, if any, who controls any
Underwriter within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act from and against any and all losses, claims, damages,
liabilities and expenses (including reasonable costs of investigation)
arising out of or based upon any untrue statement or alleged untrue
statement of a material fact contained in any Preliminary Prospectus or in
the Registration Statement or the Prospectus or in any amendment or
supplement thereto, or arising out of or based upon any omission or
alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading, except
insofar as such losses, claims, damages, liabilities or expenses arise out
of or are based upon any untrue statement or omission or alleged untrue
statement or omission which has been made therein or omitted therefrom in
reliance upon and in conformity with the information relating to such
Underwriter furnished in writing to the Company by or on behalf of any
Underwriter through you expressly for use in connection therewith;
provided, however, that the indemnification contained in this paragraph
(a) with respect to any Preliminary Prospectus shall not inure to the
benefit of any Underwriter (or to the benefit of any person controlling
such Underwriter) on account of any such loss, claim, damage, liability or
expense arising from the sale of the Shares by such Underwriter to any
person if a copy of the Prospectus shall not have been delivered or sent
to such person within the time required by the Act and the regulations
thereunder, and the untrue statement or alleged untrue statement or
omission or alleged omission of a material fact contained in such
Preliminary Prospectus was corrected in the Prospectus, provided that the
Company has delivered the Prospectus to the several Underwriters in
requisite quantity on a timely basis to permit such delivery or sending.
The foregoing indemnity agreement shall be in addition to any liability
which the Company may otherwise have.
(b) If any action, suit or proceeding shall be brought
against any Underwriter or any person controlling any Underwriter in
respect of which indemnity may be sought against the Company, such
Underwriter or such controlling person shall promptly notify the Company
and the Company shall assume the defense thereof, including the employment
of counsel and payment of all fees and expenses. Such Underwriter or any
such controlling person shall have the right to employ separate counsel in
any such action, suit or proceeding and to participate in the defense
thereof, but the fees and expenses of such counsel shall be at the expense
of such Underwriter or such controlling person unless (i) the Company has
agreed in writing to pay such fees and expenses, (ii) the Company has
failed to assume the defense and employ counsel, or (iii) the named
parties to any such action, suit or proceeding (including any impleaded
parties) include both such Underwriter or such controlling person and the
Company and such Underwriter or such controlling person shall have been
advised by its counsel that representation of such indemnified party and
the Company by the same counsel would be inappropriate under applicable
standards of professional conduct (whether or not such representation by
the same counsel has been proposed) due to actual or potential differing
interests between them (in which case the Company shall not have the right
to assume the defense of such action, suit or proceeding on behalf of such
Underwriter or such controlling person). It is understood, however, that
the Company shall, in connection with any one such action, suit or
proceeding or separate but substantially similar or related actions, suits
or proceedings in the same jurisdiction arising out of the same general
allegations or circumstances, be liable for the reasonable fees and
expenses of only one separate firm of attorneys (in addition to any local
counsel) at any time for all such Underwriters and controlling persons not
having actual or potential differing interests with you or among
themselves, which firm shall be designated in writing by Smith Barney
Inc., and that all such fees and expenses shall be reimbursed as they are
incurred. The Company shall not be liable for any settlement of any such
action, suit or proceeding effected without its written consent, but if
settled with such written consent, or if there be a final judgment for the
plaintiff in any such action, suit or proceeding, the Company agrees to
indemnify and hold harmless any Underwriter, to the extent provided in the
preceding paragraph, and any such controlling person from and against any
loss, claim, damage, liability or expense by reason of such settlement or
judgment.
(c) Each Underwriter agrees, severally and not jointly, to
indemnify and hold harmless the Company, its directors, its officers who
sign the Registration Statement, and any person who controls the Company
within the meaning of Section 15 of the Act or Section 20 of the Exchange
Act, to the same extent as the foregoing indemnity from the Company to
each Underwriter, but only with respect to information relating to such
Underwriter furnished in writing by or on behalf of such Underwriter
through you expressly for use in the Registration Statement, the
Prospectus or any Preliminary Prospectus, or any amendment or supplement
thereto. If any action, suit or proceeding shall be brought against the
Company, any of its directors, any such officer, or any such controlling
person based on the Registration Statement, the Prospectus or any
Preliminary Prospectus, or any amendment or supplement thereto, and in
respect of which indemnity may be sought against any Underwriter pursuant
to this paragraph (c), such Underwriter shall have the rights and duties
given to the Company by paragraph (b) above (except that if the Company
shall have assumed the defense thereof such Underwriter shall not be
required to do so, but may employ separate counsel therein and participate
in the defense thereof, but the fees and expenses of such counsel shall be
at such Underwriter's expense), and the Company, its directors, any such
officer, and any such controlling person shall have the rights and duties
given to the Underwriters by paragraph (b) above. The foregoing indemnity
agreement shall be in addition to any liability which the Underwriters may
otherwise have.
(d) If the indemnification provided for in this Section 7 is
unavailable to an indemnified party under paragraphs (a) or (c) hereof in
respect of any losses, claims, damages, liabilities or expenses referred
to therein, then an indemnifying party, in lieu of indemnifying such
indemnified party, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages, liabilities
or expenses (i) in such proportion as is appropriate to reflect the
relative benefits received by the Company on the one hand and the
Underwriters on the other hand from the offering of the Shares, or (ii) if
the allocation provided by clause (i) above is not permitted by applicable
law, in such proportion as is appropriate to reflect not only the relative
benefits referred to in clause (i) above but also the relative fault of
the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions that resulted in such losses,
claims, damages, liabilities or expenses, as well as any other relevant
equitable considerations. The relative benefits received by the Company
on the one hand and the Underwriters on the other shall be deemed to be in
the same proportion as the total net proceeds from the offering (before
deducting expenses) received by the Company bear to the total underwriting
discounts and commissions received by the Underwriters, in each case as
set forth in the table on the cover page of the Prospectus. The relative
fault of the Company on the one hand and the Underwriters on the other
hand shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied
by the Company on the one hand or by the Underwriters on the other hand
and the parties' relative intent, knowledge, access to information and
opportunity to correct or prevent such statement or omission.
(e) The Company and the Underwriters agree that it would not
be just and equitable if contribution pursuant to this Section 7 were
determined by a pro rata allocation (even if the Underwriters were treated
as one entity for such purpose) or by any other method of allocation that
does not take account of the equitable considerations referred to in
paragraph (d) above. The amount paid or payable by an indemnified party
as a result of the losses, claims, damages, liabilities and expenses
referred to in paragraph (d) above shall be deemed to include, subject to
the limitations set forth above, any legal or other expenses reasonably
incurred by such indemnified party in connection with investigating any
claim or defending any such action, suit or proceeding. Notwithstanding
the provisions of this Section 7, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price of
the Shares underwritten by it and distributed to the public exceeds the
amount of any damages which such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or
alleged omission. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Act) shall be entitled to
contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations to contribute pursuant
to this Section 7 are several in proportion to the respective numbers of
Firm Shares set forth opposite their names in Schedule I hereto (or such
numbers of Firm Shares increased as set forth in Section 9 hereof) and not
joint.
(f) No indemnifying party shall, without the prior written
consent of the indemnified party, effect any settlement of any pending or
threatened action, suit or proceeding in respect of which any indemnified
party is or could have been a party and indemnity could have been sought
hereunder by such indemnified party, unless such settlement includes an
unconditional release of such indemnified party from all liability on
claims that are the subject matter of such action, suit or proceeding.
(g) Any losses, claims, damages, liabilities or expenses for
which an indemnified party is entitled to indemnification or contribution
under this Section 7 shall be paid by the indemnifying party to the
indemnified party as such losses, claims, damages, liabilities or expenses
are incurred. The indemnity and contribution agreements contained in this
Section 7 and the representations and warranties of the Company set forth
in this Agreement shall remain operative and in full force and effect,
regardless of (i) any investigation made by or on behalf of any
Underwriter or any person controlling any Underwriter, the Company, its
directors or officers, or any person controlling the Company, (ii)
acceptance of any Shares and payment therefor hereunder, and (iii) any
termination of this Agreement. A successor to any Underwriter or any
person controlling any Underwriter, or to the Company, its directors or
officers, or any person controlling the Company, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements
contained in this Section 7.
8. Expenses. The Company agrees to pay the following costs
and expenses and all other costs and expenses incident to the performance
by it of its obligations hereunder: (i) the preparation, printing or
reproduction, and filing with the Commission of the Registration Statement
(including financial statements and exhibits thereto), the Preliminary
Prospectus, the Prospectus, and each amendment or supplement to any of
them; (ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies
of the Registration Statement, the Preliminary Prospectus, the Prospectus,
the Incorporated Documents, and all amendments or supplements to any of
them, as may be reasonably requested for use in connection with the
offering and sale of the Shares; (iii) the preparation, printing,
authentication, issuance and delivery of certificates for the Shares,
including any stamp taxes in connection with the original issuance and
sale of the Shares; (iv) the printing (or reproduction) and delivery of
this Agreement, the preliminary and supplemental Blue Sky Memoranda and
all other agreements or documents printed (or reproduced) and delivered in
connection with the offering of the Shares; (v) the registration of the
Shares under the Exchange Act and the listing of the Shares on the New
York Stock Exchange; (vi) the registration or qualification of the Shares
for offer and sale under the securities or Blue Sky laws of the several
states as provided in Section 5(f) hereof (including the reasonable fees,
expenses and disbursements of counsel for the Underwriters relating to the
preparation, printing or reproduction, and delivery of the preliminary and
supplemental Blue Sky Memoranda and such registration and qualification);
(vii) the filing fees and the fees and expenses of counsel for the
Underwriters in connection with any filings required to be made with the
National Association of Securities Dealers, Inc.; (viii) the
transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers
of the Shares; and (ix) the fees and expenses of the Company's accountants
and the fees and expenses of counsel (including local and special counsel)
for the Company.
9. Effective Date of Agreement. This Agreement shall
become effective: (i) upon the execution and delivery hereof by the
parties hereto; or (ii) if, at the time this Agreement is executed and
delivered, it is necessary for a post-effective amendment to the
Registration Statement to be declared effective before the offering of the
Shares may commence, when notification of the effectiveness of such
post-effective amendment has been released by the Commission. Until such
time as this Agreement shall have become effective, it may be terminated
by the Company, by notifying you, or by you, as Representatives of the
several Underwriters, by notifying the Company.
If any one or more of the Underwriters shall fail or refuse to
purchase Shares which it or they are obligated to purchase hereunder on
the Closing Date, and the aggregate number of Shares which such defaulting
Underwriter or Underwriters are obligated but fail or refuse to purchase
is not more than one-tenth of the aggregate number of Shares which the
Underwriters are obligated to purchase on the Closing Date, each
non-defaulting Underwriter shall be obligated, severally, in the
proportion which the number of Firm Shares set forth opposite its name in
Schedule I hereto bears to the aggregate number of Firm Shares set forth
opposite the names of all non-defaulting Underwriters or in such other
proportion as you may specify in accordance with Section 20 of the Master
Agreement Among Underwriters of Smith Barney Inc., to purchase the Shares
which such defaulting Underwriter or Underwriters are obligated, but fail
or refuse, to purchase. If any one or more of the Underwriters shall fail
or refuse to purchase Shares which it or they are obligated to purchase on
the Closing Date and the aggregate number of Shares with respect to which
such default occurs is more than one-tenth of the aggregate number of
Shares which the Underwriters are obligated to purchase on the Closing
Date and arrangements satisfactory to you and the Company for the purchase
of such Shares by one or more non-defaulting Underwriters or other party
or parties approved by you and the Company are not made within 36 hours
after such default, this Agreement will terminate without liability on the
part of any non-defaulting Underwriter or the Company. In any such case
which does not result in termination of this Agreement, either you or the
Company shall have the right to postpone the Closing Date, but in no event
for longer than seven days, in order that the required changes, if any, in
the Registration Statement and the Prospectus or any other documents or
arrangements may be effected. Any action taken under this paragraph shall
not relieve any defaulting Underwriter from liability in respect of any
such default of any such Underwriter under this Agreement. The term
"Underwriter" as used in this Agreement includes, for all purposes of this
Agreement, any party not listed in Schedule I hereto who, with your
approval and the approval of the Company, purchases Shares which a
defaulting Underwriter is obligated, but fails or refuses, to purchase.
Any notice under this Section 9 may be given by telegram,
telecopy or telephone but shall be subsequently confirmed by letter.
10. Termination. This Agreement shall be subject to
termination in your absolute discretion, without liability on the part of
any Underwriter to the Company by notice to the Company, if prior to the
Closing Date or any Option Closing Date (if different from the Closing
Date and then only as to the Additional Shares), as the case may be, (i)
trading in securities generally on the New York Stock Exchange, the
American Stock Exchange or the Nasdaq National Market shall have been
suspended or materially limited, (ii) a general moratorium on commercial
banking activities in New York or California shall have been declared by
either federal or state authorities, or (iii) there shall have occurred
any outbreak or escalation of hostilities or other international or
domestic calamity, crisis or change in political, financial or economic
conditions, the effect of which on the financial markets of the United
States is such as to make it, in your judgment, impracticable or
inadvisable to commence or continue the offering of the Shares at the
offering price to the public set forth on the cover page of the Prospectus
or to enforce contracts for the resale of the Shares by the Underwriters.
Notice of such termination may be given to the Company by telegram,
telecopy or telephone and shall be subsequently confirmed by letter.
11. Information Furnished by the Underwriters. The
statements set forth in the last paragraph on the cover page, the
stabilization legend on the inside front cover, and the statements in the
first and second paragraph under the caption "Underwriting" in the
Prospectus, constitute the only information furnished by or on behalf of
the Underwriters through you as such information is referred to in
Sections 4(b) and 7 hereof.
12. Miscellaneous. Except as otherwise provided in Sections
3, 9 and 10 hereof, notice given pursuant to any provision of this
Agreement shall be in writing and shall be delivered (i) if to the
Company, at the office of the Company, Storage Equities, Inc., 600 North
Brand Boulevard, Suite 300, Glendale, California 91203, Attention: Legal
Department, or (ii) if to you, as Representatives of the several
Underwriters, care of Smith Barney Inc., 388 Greenwich Street, New York,
New York 10013, Attention: Manager, Investment Banking Division.
This Agreement has been and is made solely for the benefit of
the several Underwriters, the Company, its directors and officers, and the
other controlling persons referred to in Section 7 hereof and their
respective successors and assigns, to the extent provided herein, and no
other person shall acquire or have any right under or by virtue of this
Agreement. Neither the term "successor" nor the term "successors and
assigns" as used in this Agreement shall include a purchaser from any
Underwriter of any of the Shares in his status as such purchaser.
13. Applicable Law; Counterparts. This agreement shall be
governed by and construed in accordance with the laws of the State of New
York applicable to contracts made and to be performed within the State of
New York.
This Agreement may be signed in various counterparts which
together constitute one and the same instrument. If signed in
counterparts, this Agreement shall not become effective unless at least
one counterpart hereof shall have been executed and delivered on behalf of
each party hereto.
Please confirm that the foregoing correctly sets forth the agreement
between the Company and the several Underwriters.
Very truly yours,
STORAGE EQUITIES, INC.
By ________________________
Name:
Title:
Confirmed as of the date first
above mentioned on behalf of
themselves and the other several
Underwriters named in Schedule I
hereto.
SMITH BARNEY INC.
PAINEWEBBER INCORPORATED
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
THE ROBINSON-HUMPHREY
COMPANY, INC.
As Representatives of the Several Underwriters
By SMITH BARNEY INC.
By _________________________
Managing Director
SCHEDULE I
STORAGE EQUITIES, INC.
Number of
Underwriters Firm Shares
Smith Barney Inc.
PaineWebber Incorporated
Donaldson, Lufkin & Jenrette Securities Corporation
The Robinson-Humphrey Company, Inc. _________
Total 1,500,000
EXHIBIT 3.1
CERTIFICATE OF DETERMINATION OF PREFERENCES
OF
____% CUMULATIVE PREFERRED STOCK, SERIES F
OF
STORAGE EQUITIES, INC.
The undersigned, Harvey Lenkin and Sarah Hass, President and
Secretary, respectively, of STORAGE EQUITIES, INC., a California
corporation, do hereby certify:
FIRST: The Restated Articles of Incorporation of the
Corporation authorize the issuance of 50,000,000 shares of stock
designated "preferred shares," issuable from time to time in one or more
series, and authorize the Board of Directors to fix the number of shares
constituting any such series, and to determine or alter the dividend
rights, dividend rate, conversion rights, voting rights, right and terms
of redemption (including sinking fund provisions), the redemption price or
prices and the liquidation preference of any wholly unissued series of
such preferred shares, and the number of shares constituting any such
series.
SECOND: The Board of Directors of the corporation did duly
adopt the resolutions attached hereto as Exhibit A and incorporated herein
by reference authorizing and providing for the creation of a series of
preferred shares to be known as "____% Cumulative Preferred Stock, Series
F" consisting of 1,725,000 shares, none of the shares of such series
having been issued.
We further declare under penalty of perjury under the laws of
the State of California that the matters set forth in this certificate are
true and correct of our own knowledge.
IN WITNESS WHEREOF, the undersigned have executed this
certificate this _____ day of ____________________, 1995.
_________________________
Harvey Lenkin
President
_________________________
Sarah Hass
Secretary
EXHIBIT A
RESOLUTION OF THE BOARD OF DIRECTORS
OF STORAGE EQUITIES, INC.
ESTABLISHING A SERIES OF ____% CUMULATIVE
PREFERRED STOCK, SERIES F
RESOLVED, that pursuant to the authority conferred upon the
Board of Directors by Article III of the Restated Articles of
Incorporation of this Corporation, there is hereby established a series of
the authorized preferred shares of this Corporation having a par value of
$.01 per share, which series shall be designated "____% Cumulative
Preferred Stock, Series F," shall consist of 1,725,000 shares and shall
have the following rights, preferences and privileges:
(a) Dividend Rights.
(1) Dividends shall be payable in cash on the shares of this
Series when, as and if declared by the Board of Directors, out of funds
legally available therefor: (i) for the period (the "Initial Dividend
Period") from the Deemed Original Issue Date (as defined below) to but
excluding July 1, 1995, and (ii) for each quarterly dividend period
thereafter (the Initial Dividend Period and each quarterly dividend period
being hereinafter individually referred to as a "Dividend Period" and
collectively referred to as "Dividend Periods"), which quarterly Dividend
Periods shall be in four equal amounts and shall commence on January 1,
April 1, July 1 and October 1 in each year (each, a "Dividend Period
Commencement Date"), commencing on July 1, 1995, and shall end on and
include the day next preceding the next Dividend Period Commencement Date,
at a rate per annum equal to ____% of the $25.00 per share stated value
thereof (the "Dividend Rate"). Dividends on each share of this Series
shall be cumulative from the Deemed Original Issue Date of such share and
shall be payable, without interest thereon, when, as and if declared by
the Board of Directors, on March 31, June 30, September 30 and December 31
of each year, commencing on June 30, 1995 or, in the case of shares of
this Series with a Deemed Original Issue Date after June 30, 1995, the
first such dividend payment date following such Deemed Original Issue
Date; provided, that if any such day shall be a Saturday, Sunday, or a day
on which banking institutions in the State of New York or the State of
California are authorized or obligated by law to close, or a day which is
or is declared a national or a New York or California state holiday (any
of the foregoing a "Non-Business Day"), then the payment date shall be the
next succeeding day which is not a Non-Business Day. Each such dividend
shall be paid to the holders of record of shares of this Series as they
appear on the stock register of the Corporation on such record date, not
more than 45 days nor less than 15 days preceding the payment date
thereof, as shall be fixed by the Board of Directors. Dividends on
account of arrears for any past Dividend Periods may be declared and paid
at any time, without reference to any regular dividend payment date, to
holders of record on such date, not more than 45 days nor less than 15
days preceding the payment date thereof, as may be fixed by the Board of
Directors. After full cumulative dividends on this Series have been paid
or declared and funds therefor set aside for payment, including for the
then current Dividend Period, the holders of shares of this Series will
not be entitled to any further dividends with respect to that Dividend
Period.
"Deemed Original Issue Date" means (a) in the case of any
share which is part of the first issuance of shares of this Series or part
of a subsequent issuance of shares of this Series prior to July 1, 1995,
the date of such first issuance or subsequent issuance, as the case may
be, and (b) in the case of any share which is part of a subsequent
issuance of shares of this Series on or after July 1, 1995, the later of
(x) July 1, 1995 and (y) the latest Dividend Period Commencement Date
which precedes the date of issuance of such share and which succeeds the
last Dividend Period for which full cumulative dividends have been paid;
provided that, in the case of any share which is part of a subsequent
issuance, the date of issuance of which falls between (i) the record date
for dividends payable on the first succeeding dividend payment date and
(ii) such dividend payment date, the "Deemed Original Issue Date" means
the date of the Dividend Period Commencement Date that immediately follows
the date of issuance.
(2) Dividends payable on shares of this Series for any
period greater or less than a full Dividend Period, including the Initial
Dividend Period, shall be computed on the basis of a 360-day year
consisting of twelve 30-day months.
(3) The Corporation shall not declare or pay or set apart
for payment any dividends on any series of preferred shares ranking, as to
dividends, on a parity with or junior to the shares of this Series unless
full cumulative dividends have been or contemporaneously are declared and
paid, or declared and a sum sufficient for payment thereof is set apart
for payment, for all Dividend Periods terminating on or prior to the date
of payment of any such dividends on such other series of preferred shares.
When dividends are not paid in full upon the shares of this Series and any
other series of preferred shares ranking on a parity therewith as to
dividends (including the shares of the Corporation's 10% Cumulative
Preferred Stock, Series A (the "Series A Preferred Stock"), 9.20%
Cumulative Preferred Stock, Series B (the "Series B Preferred Stock"),
9.50% Cumulative Preferred Stock, Series D (the "Series D Preferred
Stock"), 10% Cumulative Preferred Stock, Series E (the "Series E Preferred
Stock") and Adjustable Rate Cumulative Preferred Stock, Series C (the
"Adjustable Rate Preferred Stock")), all dividends declared upon shares of
this Series and any other series of preferred shares ranking on a parity
therewith as to dividends shall be declared pro rata so that the amount of
dividends declared per share on the shares of this Series and such other
series of preferred shares shall in all cases bear to each other that same
ratio that the accumulated dividends per share on the shares of this
Series and such other series of preferred shares bear to each other.
Except as provided in the preceding sentence, unless full cumulative
dividends on the shares of this Series have been paid for all past
Dividend Periods, no dividends (other than in shares of the Corporation's
common stock, par value $.10 per share (together with any other shares of
capital stock of the Corporation into which such shares shall be
reclassified or changed ("Common Shares"), or another stock ranking junior
to the shares of this Series as to dividends and upon liquidation) shall
be declared or paid or set aside for payment nor shall any other
distribution be made upon the Common Shares or on any other stock of the
Corporation ranking junior to or on a parity with the shares of this
Series as to dividends or upon liquidation. Unless full cumulative
dividends on the shares of this Series have been paid for all past
Dividend Periods, no Common Shares or any other stock of the Corporation
ranking junior to or on a parity with the shares of this Series as to
dividends or upon liquidation shall be redeemed, purchased, or otherwise
acquired for any consideration (or any moneys be paid to or made available
for a sinking fund for the redemption of any shares of any such stock) by
the Corporation or any subsidiary, except by conversion into or exchange
for stock of the Corporation ranking junior to the shares of this Series
as to dividends and upon liquidation.
(b) Liquidation.
In the event of any voluntary or involuntary liquidation,
dissolution, or winding up of the Corporation, the holders of shares of
this Series are entitled to receive out of the assets of the Corporation
available for distribution to shareholders, before any distribution of
assets is made to holders of Common Shares or any other class or series of
shares ranking junior to the shares of this Series upon liquidation,
liquidating distributions in the amount of the stated value of $25 per
share plus all accumulated and unpaid dividends (whether or not earned or
declared) for the then current and all past Dividend Periods. If, upon
any voluntary or involuntary liquidation, dissolution, or winding up of
the Corporation the amounts payable with respect to the shares of this
Series and any other shares of the Corporation ranking as to any such
distribution on a parity with the shares of this Series are not paid in
full, the holders of shares of this Series and of such other shares
(including the shares of Series A, Series B, Series D and Series E
Preferred Stock and Adjustable Rate Preferred Stock) will share ratably in
any such distribution of assets of the Corporation in proportion to the
full respective preferential amounts to which they are entitled. After
payment of the full amount of the liquidating distribution to which they
are entitled, the holders of shares of this Series will not be entitled to
any further participation in any distribution of assets by the
Corporation.
(1) Written notice of any such liquidation, dissolution or
winding up of the Corporation, stating the payment date or dates when, and
the place or places where the amounts distributable in such circumstances
shall be payable, shall be given by first class mail, postage pre-paid,
not less than 30 nor more than 60 days prior to the payment date stated
therein, to each record holder of the shares of this Series at the
respective addresses of such holders as the same shall appear on the stock
transfer records of the Corporation.
(2) For purposes of liquidation rights, a reorganization (as
defined in Section 181 of the California Corporations Code) or
consolidation or merger of the Corporation with or into any other
corporation or corporations or a sale of all or substantially all of the
assets of the Corporation shall be deemed not to be a liquidation,
dissolution or winding up of the Corporation.
(c) Redemption.
(1) Except as provided in clause (9) below, the shares of
this Series are not redeemable prior to April 30, 2005. On and after such
date, the shares of this Series are redeemable at the option of the
Corporation, by resolution of the Board of Directors, in whole or in part,
from time to time upon not less than 30 nor more than 60 days' notice, at
a cash redemption price of the stated value of $25 per share plus all
accumulated and unpaid dividends (whether or not earned or declared) to
the date of redemption.
(2) If fewer than all the outstanding shares of this Series
are to be redeemed, the number of shares to be redeemed will be determined
by the Board of Directors, and such shares shall be redeemed pro rata from
the holders of record of such shares in proportion to the number of such
shares held by such holders (with adjustments to avoid redemption of
fractional shares) or by lot in a manner determined by the Board of
Directors.
(3) Notwithstanding the foregoing, if any dividends,
including any accumulation, on the shares of this Series are in arrears,
no shares of this Series shall be redeemed unless all outstanding shares
of this Series are simultaneously redeemed, and the Corporation shall not
purchase or otherwise acquire, directly or indirectly, any shares of this
Series; provided, however, that the foregoing shall not prevent the
purchase or acquisition of shares of this Series pursuant to a purchase or
exchange offer provided such offer is made on the same terms to all
holders of shares of this Series.
(4) Immediately prior to any redemption of shares of this
Series, the Corporation shall pay, in cash, any accumulated and unpaid
dividends through the redemption date, unless a redemption date falls
after a dividend payment record date and prior to the corresponding
dividend payment date, in which case each holder of shares of this Series
at the close of business on such dividend payment record date shall be
entitled to the dividend payable on such shares on the corresponding
dividend payment date notwithstanding the redemption of such shares before
such dividend payment date. Except as expressly provided hereinabove, the
Corporation shall make no payment or allowance for unpaid dividends,
whether or not in arrears, on shares of this Series called for redemption.
(5) Notice of redemption shall be given by publication in a
newspaper of general circulation in the County of Los Angeles and The City
of New York, such publication to be made once a week for two successive
weeks, commencing not less than 30 nor more than 60 days prior to the date
fixed for redemption thereof. A similar notice will be mailed by the
Company by first class mail, postage pre-paid, to each record holder of
the shares of this Series to be redeemed, not less than 30 nor more than
60 days prior to such redemption date, to the respective addresses of such
holders as the same shall appear on the stock transfer records of the
Corporation. Each notice shall state: (i) the redemption date; (ii) the
number of shares of this Series to be redeemed; (iii) the redemption
price; (iv) the place or places where certificates for such shares are to
be surrendered for payment of the redemption price; and (v) that dividends
on the shares to be redeemed will cease to accumulate on such redemption
date. If fewer than all the shares of this Series held by any holder are
to be redeemed, the notice mailed to such holder shall also specify the
number of shares of this Series to be redeemed from such holder.
(6) In order to facilitate the redemption of shares of this
Series, the Board of Directors may fix a record date for the determination
of the shares to be redeemed, such record date to be not less than 30 nor
more than 60 days prior to the date fixed for such redemption.
(7) Notice having been given as provided above, from and
after the date fixed for the redemption of shares of this Series by the
Corporation (unless the Corporation shall fail to make available the money
necessary to effect such redemption), the holders of shares selected for
redemption shall cease to be shareholders with respect to such shares and
shall have no interest in or claim against the Corporation by virtue
thereof and shall have no voting or other rights with respect to such
shares, except the right to receive the moneys payable upon such
redemption from the Corporation, less any required tax withholding amount,
without interest thereon, upon surrender (and endorsement or assignment of
transfer, if required by the Corporation and so stated in the notice) of
their certificates, and the shares represented thereby shall no longer be
deemed to be outstanding. If fewer than all the shares represented by a
certificate are redeemed, a new certificate shall be issued, without cost
to the holder thereof, representing the unredeemed shares. The
Corporation may, at its option, at any time after a notice of redemption
has been given, deposit the redemption price for the shares of this Series
designated for redemption and not yet redeemed, plus any accumulated and
unpaid dividends thereon to the date fixed for redemption, with the
transfer agent or agents for this Series, as a trust fund for the benefit
of the holders of the shares of this Series designated for redemption,
together with irrevocable instructions and authority to such transfer
agent or agents that such funds be delivered upon redemption of such
shares and to pay, on and after the date fixed for redemption or prior
thereto, the redemption price of the shares to their respective holders
upon the surrender of their share certificates. From and after the making
of such deposit, the holders of the shares designated for redemption shall
cease to be shareholders with respect to such shares and shall have no
interest in or claim against the Corporation by virtue thereof and shall
have no voting or other rights with respect to such shares, except the
right to receive from such trust fund the moneys payable upon such
redemption, without interest thereon, upon surrender (and endorsement, if
required by the Corporation) of their certificates, and the shares
represented thereby shall no longer be deemed to be outstanding. Any
balance of such moneys remaining unclaimed at the end of the five-year
period commencing on the date fixed for redemption shall be repaid to the
Corporation upon its request expressed in a resolution of its Board of
Directors.
(8) Any shares of this Series that shall at any time have
been redeemed shall, after such redemption, have the status of authorized
but unissued preferred shares, without designation as to series until such
shares are once more designated as part of a particular series by the
Board of Directors.
(9) If the Board of Directors of the Corporation shall, at
any time and in good faith, be of the opinion that ownership of securities
of the Corporation has or may become concentrated to an extent that may
prevent the Corporation from qualifying as a real estate investment trust
under the REIT Provisions of the Internal Revenue Code, then the Board of
Directors shall have the power, by lot or other means deemed equitable by
them to prevent the transfer of and/or to call for redemption a number of
shares of this Series sufficient, in the opinion of the Board of
Directors, to maintain or bring the direct or indirect ownership thereof
into conformity with the requirements of such a real estate investment
trust under the REIT Provisions of the Internal Revenue Code. The
redemption price to be paid for shares of this Series so called for
redemption, on the date fixed for redemption, shall be the average of the
highest bid and the lowest asked quotations on the last business day prior
to the redemption date as reported by the National Quotation Bureau,
Incorporated or a similar organization selected from time to time by the
Corporation or if there be no such bid and asked quotations, as determined
by the Board of Directors in good faith. From and after the date fixed
for redemption by the Board of Directors, the holder of any shares of this
Series so called for redemption shall cease to be entitled to any
distributions, voting rights and other benefits with respect to such
shares of this Series, other than the right to payment of the redemption
price determined as aforesaid. "REIT Provisions of the Internal Revenue
Code" shall mean Sections 856 through 860 of the Internal Revenue Code of
1986, as amended. In order to exercise the redemption option set forth in
this clause (9), with respect to the shares of this Series, the
Corporation shall give notice of redemption by publication in a newspaper
of general circulation in the County of Los Angeles and The City of New
York, such publication to be made once a week for two successive weeks,
commencing not less than 30 nor more than 60 days prior to the date fixed
for redemption. A similar notice will be mailed by the Corporation by
first class mail, postage pre-paid, to each record holder of the shares of
this Series to be redeemed, not less than 30 nor more than 60 days prior
to such redemption date, to the respective addresses of such holders as
the same shall appear on the stock transfer records of the Corporation.
Each notice shall state: (i) the redemption date; (ii) the number of
shares of this Series to be redeemed; (iii) the redemption price; (iv) the
place or places where certificates for such shares are to be surrendered
for payment of the redemption price; and (v) that dividends on the shares
to be redeemed will cease to accumulate on such redemption date. If fewer
than all the shares of this Series held by any holder are to be redeemed,
the notice mailed to such holder shall also specify the number of shares
of this Series to be redeemed from such holder.
(d) Maintenance of Debt Ratio. Without the affirmative vote
or the written consent of the holders of a majority of the shares of this
Series, the Corporation will not take any action that would result in a
ratio of Debt to Assets (the "Debt Ratio") in excess of 50%.
"Debt" means, as of any date of determination, all
liabilities that should, in accordance with GAAP, be reflected as a
liability on the consolidated balance sheet of the Corporation as of such
date of determination; provided, however, that "Debt" shall not include
liabilities included in the consolidated balance sheet under the headings
"accrued and other liabilities" or "minority interest" to the extent that
the inclusion of such liabilities under such headings is consistent with
the Corporation's past practice.
"Assets" means, as of any date of determination, all assets
that should, in accordance with GAAP, be reflected as an asset on the
consolidated balance sheet of the Corporation as of such date of
determination.
"GAAP" means generally accepted accounting principles as in
effect in the United States of America from time to time, consistently
applied.
(e) Voting Rights. The shares of this Series shall not have
any voting powers either general or special, except as required by law,
except as set forth in Section (d) hereof and except that:
(1) (A) If the Corporation shall fail to pay full
cumulative dividends on the shares of this Series or any other of its
preferred shares for six quarterly dividend payment periods, whether or
not consecutive (a "Dividend Default"), the holders of all outstanding
preferred shares, voting as a single class without regard to series, will
be entitled to elect two Directors until full cumulative dividends for all
past dividend payment periods on all preferred shares have been paid or
declared and funds therefor set apart for payment. Such right to vote
separately as a class to elect Directors shall, when vested, be subject,
always, to the same provisions for the vesting of such right to elect
Directors separately as a class in the case of future Dividend Defaults.
At any time when such right to elect Directors separately as a class shall
have so vested, the Corporation may, and upon the written request of the
holders of record of not less than 20% of the total number of preferred
shares of the Corporation then outstanding shall, call a special meeting
of stockholders for the election of Directors. In the case of such a
written request, such special meeting shall be held within 90 days after
the delivery of such request and, in either case, at the place and upon
the notice provided by law and in the Bylaws of the Corporation, provided
that the Corporation shall not be required to call such a special meeting
if such request is received less than 120 days before the date fixed for
the next ensuing Annual Meeting of Shareholders of the Corporation and the
holders of all classes of outstanding preferred shares are afforded the
opportunity to elect such Directors (or fill any vacancy) at such Annual
Meeting of Shareholders. Directors elected as aforesaid shall serve until
the next Annual Meeting of Shareholders of the Corporation or until their
respective successors shall be elected and qualified. If, prior to the
end of the term of any Director elected as aforesaid, a vacancy in the
office of such Director shall occur during the continuance of a Dividend
Default by reason of death, resignation, or disability, such vacancy shall
be filled for the unexpired term by the appointment of a new Director for
the unexpired term of such former Director, such appointment to be made by
the remaining Director elected as aforesaid.
(B) In addition to the right to elect Directors set
forth in clause (A) above, if, without the affirmative vote or the written
consent of the holders of a majority of the shares of this Series, on the
last day of two consecutive fiscal quarters of the Corporation, the Debt
Ratio exceeds 50% (a "Debt Ratio Default"), the holders of all outstanding
shares of this Series, voting as a single class, will be entitled to elect
two Directors until the Debt Ratio as of the last day of a fiscal quarter
of the Corporation is reduced to 50% or less. Such right to vote
separately as a class to elect Directors shall, when vested, be subject,
always, to the same provisions for the vesting of such right to elect
Directors separately as a class in the case of future Debt Ratio Defaults.
At any time when such right to elect Directors separately as a class shall
have so vested, the Corporation may, and upon the written request of the
holders of record of not less than 20% of the total number of shares of
this Series then outstanding shall, call a special meeting of stockholders
for the election of Directors. In the case of such a written request,
such special meeting shall be held within 90 days after the delivery of
such request and, in either case, at the place and upon the notice
provided by law and in the Bylaws of the Corporation, provided that the
corporation shall not be required to call such a special meeting if such
request is received less than 120 days before the date fixed for the next
ensuing Annual Meeting of Shareholders of the Corporation and the holders
of shares of this Series are afforded the opportunity to elect such
Directors (or fill any vacancy) at such Annual Meeting of Shareholders.
Directors elected as aforesaid shall serve until the next Annual Meeting
of Shareholders of the Corporation or until their respective successors
shall be elected and qualified. If, prior to the end of the term of any
Director elected as aforesaid, a vacancy in the office of such Director
shall occur during the continuance of a Debt Ratio Default by reason of
death, resignation, or disability, such vacancy shall be filled for the
unexpired term by the appointment of a new Director for the unexpired term
of such former Director, such appointment to be made by the remaining
Director elected as aforesaid.
(2) The affirmative vote or consent of the holders of at
least two-thirds of the outstanding shares of this Series, voting
separately as a class, will be required for any amendment to the Articles
of Incorporation of the Corporation that will adversely alter or change
the powers, preferences, privileges or rights of the shares of this
Series, except as set forth below. The affirmative vote or consent of the
holders of at least two-thirds of the outstanding shares of this Series
and any other series of preferred shares ranking on a parity with this
Series as to dividends and upon liquidation (including the shares of
Series A, Series B, Series D and Series E Preferred Stock and Adjustable
Rate Preferred Stock), voting as a single class without regard to series,
will be required to issue, authorize or increase the authorized amount of
any class or series of shares ranking prior to this Series as to dividends
or upon liquidation or to issue or authorize any obligation or security
convertible into or evidencing a right to purchase any such security, but
the Articles of Incorporation may be amended to increase the number of
authorized preferred shares ranking on a parity with or junior to this
Series or to create another class of preferred shares ranking on a parity
with or junior to this Series without the vote of the holders of
outstanding shares of this Series.
(3) The affirmative vote or consent of the holders of a
majority of the outstanding shares of this Series, voting separately as a
class, will be required for any amendment or repeal of the following
provisions of the Bylaws of the Corporation, which would be adverse to the
interests of the holders of shares of this Series, and for any other
changes to the Bylaws of the Corporation that affect these provisions in a
manner which would be adverse to the interests of the holders of shares of
this Series: Article IV, Section 2 (relating to the Corporation's
permissible Asset Coverage), Article VIII, Section 2(g) and (h) (relating
to the Corporation's investment policy) and each of the defined terms used
in any of the foregoing provisions.
(4) Except to the extent required pursuant to clause (3)
above, nothing herein shall be taken to require a class vote or consent in
connection with the authorization, designation, increase or issuance of
any shares of any class or series (including additional preferred shares
of any series) that rank junior to or on a parity with this Series as to
dividends and liquidation rights or in connection with the authorization,
designation, increase or issuance of any bonds, mortgages, debentures or
other debt obligations of the Corporation.
(5) The right to elect Directors set forth in clause (1)(B)
above is not intended to be the exclusive remedy of holders of the shares
of this Series in the event of a Debt Ratio Default.
(f) Conversion. The shares of this Series are not
convertible into shares of any other class or series of the capital stock
of the Corporation.
EXHIBIT 10.1
SEVENTH AMENDMENT TO
AMENDED AND RESTATED ADVISORY CONTRACT
THIS SEVENTH AMENDMENT TO AMENDED AND RESTATED ADVISORY CONTRACT
(the "Seventh Amendment"), dated as of April 13, 1995, amends the AMENDED
AND RESTATED ADVISORY CONTRACT dated as of September 30, 1991, as
previously amended (the "Contract"), entered into between STORAGE
EQUITIES, INC., a California corporation (the "Company"), and PUBLIC
STORAGE ADVISERS, INC., a California corporation (the "Adviser").
R E C I T A L S
A. Defined terms used in this Seventh Amendment (that are not
otherwise defined) have the meanings assigned to those terms in the
Contract.
B. Pursuant to a Second Amendment to Amended and Restated
Advisory Contract dated as of May 14, 1992 (the "Second Amendment"), the
Company and the Adviser amended the Contract to establish the compensation
payable by the Company to the Adviser upon the issuance of preferred
stock. As amended pursuant to a Sixth Amendment to Amended and Restated
Advisory Contract dated as of January 12, 1995 (the "Sixth Amendment"),
Section 11(a)(iii) of the Contract (the "Subordination Provision")
provides that the Adviser will not be entitled to payment of the Advisory
Fee with respect to services rendered during any quarter in which full
cumulative dividends on the Series A Preferred Stock or Series B Preferred
Stock or Adjustable Rate Preferred Stock or Series D Preferred Stock or
Series E Preferred Stock have not been paid or declared and funds therefor
set aside for payment.
C. The Company and the Adviser desire to amend the Contract to
provide that the Subordination Provision also applies to the issuance of
cumulative preferred stock, Series F in an underwritten offering.
NOW, THEREFORE, the parties hereby agree as follows:
1. Section 11(a)(iii) of the Contract is hereby amended in its
entirety to read as follows:
(iii) Series A Preferred Stock, Series B Preferred
Stock, Adjustable Rate Preferred Stock, Series D Preferred
Stock, Series E Preferred Stock and Series F Preferred Stock.
The Adviser will not be entitled to payment of the Advisory
Fee with respect to services rendered during any quarter in
which full cumulative dividends on the Series A Preferred
Stock or Series B Preferred Stock or Adjustable Rate Preferred
Stock or Series D Preferred Stock or Series E Preferred Stock
or Series F Preferred Stock (as defined below) have not been
paid or declared and funds therefor set aside for payment. To
the extent that the Adviser receives a monthly payment or
payments of the Advisory Fee pursuant to Section 11(a)(ii) of
the Contract with respect to a quarter as to which the Adviser
is subsequently determined not to be entitled to payment of
the Advisory Fee, the Adviser shall promptly refund such
amounts. "Series A Preferred Stock means the currently
outstanding shares of the Company's 10% Cumulative Preferred
Stock, Series A, "Series B Preferred Stock" means the
currently outstanding shares of the Company's 9.20% Cumulative
Preferred Stock, Series B, "Adjustable Rate Preferred Stock"
means the currently outstanding shares of the Company's
Adjustable Rate Cumulative Preferred Stock, Series C,
"Series D Preferred Stock" means the currently outstanding
shares of the Company's 9.50% Cumulative Preferred Stock,
Series D, "Series E Preferred Stock" means the currently
outstanding shares of the Company's 10% Cumulative Preferred
Stock, Series E, and "Series F Preferred Stock" means the
shares of the Company's ____% Cumulative Preferred Stock,
Series F issued in the first underwritten offering following
the date of this Seventh Amendment.
2. The Second Amendment, as amended by the Third Amendment to
Amended and Restated Advisory Contract dated as of February 25, 1993 (the
"Third Amendment"), the Fourth Amendment to Amended and Restated Advisory
Contract dated as of June 7, 1994 (the "Fourth Amendment"), the Fifth
Amendment to Amended and Restated Advisory Contract dated as of August 9,
1994 (the "Fifth Amendment"), the Sixth Amendment and this Seventh
Amendment, is not intended to confer or give any person (including any
holder of the Series A Preferred Stock or Series B Preferred Stock or
Adjustable Rate Preferred Stock or Series D Preferred Stock or Series E
Preferred Stock or Series F Preferred Stock) other than the parties hereto
and their successors or assigns any rights or remedies under or by reason
of the Second Amendment, the Third Amendment, the Fourth Amendment, the
Fifth Amendment, the Sixth Amendment or this Seventh Amendment. The
Second Amendment, as amended by the Third Amendment, the Fourth Amendment,
the Fifth Amendment, the Sixth Amendment and this Seventh Amendment, may
be modified or terminated without the consent of the holders of the Series
A Preferred Stock or Series B Preferred Stock or Adjustable Rate Preferred
Stock or Series D Preferred Stock or Series E Preferred Stock or Series F
Preferred Stock.
3. Except as expressly provided in this Seventh Amendment, all of
the provisions of the Contract are hereby ratified and confirmed.
IN WITNESS WHEREOF, the parties hereto have executed this Seventh
Amendment as of the day and year set forth at the beginning of this
Seventh Amendment.
STORAGE EQUITIES, INC.,
a California corporation
By: /S/ OBREN B. GERICH
-------------------------
Obren B. Gerich,
Vice President
PUBLIC STORAGE ADVISERS, INC.,
a California corporation
By: /S/ HARVEY LENKIN
-------------------------
Harvey Lenkin, President
