UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 3 )*
Public Storage Properties XIV, Inc.
(Name of Issuer)
Common Stock Series A
(Title of Class of Securities)
744613 10 0
(CUSIP Number)
David Goldberg, 701 Western Avenue, Suite 200, Glendale,
California 91201-2397, 818/244-8080, ext. 529
---------------------------------------------------------
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 5, 1996
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the subject of
this Schedule 13D, and is filing this schedule because of Rule
13d-1(b)(3) or (4), check the following box [ ].
Check the following box if a fee is being paid with the
statement [ ]. (A fee is not required only if the reporting
person: (1) has a previous statement on file reporting
beneficial ownership of more than five percent of the class of
securities described in Item 1; and (2) has filed no amendment
subsequent thereto reporting beneficial ownership of five
percent or less of such class.) (See Rule 13d-7.)
NOTE: Six copies of this statement, including all exhibits,
should be filed with the Commission. See Rule 13d-1(a) for
other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent
amendment containing information which would alter disclosures
provided in a prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 ("Act") or otherwise
subject to the liabilities of that section of the Act but shall
be subject to all other provisions of the Act (however, see the
Notes).
SCHEDULE 13D
CUSIP No. 744613 10 0
1 Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Public Storage, Inc.
2 Check the Appropriate Box if a Member of a Group*
a. [ ]
b. [ ]
3 SEC Use Only
4 Source of Funds*
WC
5 Check Box if Disclosure of Legal Proceedings is Required
Pursuant to Items 2(d) or 2(e) [ ]
6 Citizenship or Place of Organization
California
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH
7 Sole Voting Power
208,568
8 Shared Voting Power
N/A
9 Sole Dispositive Power
208,033
10 Shared Dispositive Power
N/A
11 Aggregate Amount Beneficially Owned by Each Reporting
Person
208,568
12 Check Box if the Aggregate Amount in Row (11) Excludes
Certain Shares* [ ]
13 Percent of Class Represented by Amount in Row (11)
9.22%
14 Type of Reporting Person*
CO
The Statement on Schedule 13D dated November 16, 1995, as
amended and restated by Amendment No. 1 dated March 11, 1996 and
amended by Amendment No. 2 dated May 7, 1996 (the "Schedule 13D") filed
by Public Storage, Inc. (the "Reporting Person"), relating to the Common
Stock Series A, par value $.01 per share (the "Common Stock Series A"
or the "Series A Shares"), of Public Storage Properties XIV, Inc., a
California corporation (the "Issuer"), is amended by this Amendment
No. 3 as set forth below. Defined terms that are not defined herein
have the meanings assigned to those terms in the Schedule 13D.
Item 3. Source and Amount of Funds or Other Consideration
The 69,900 Series A Shares acquired by the Reporting Person
other than in the merger of Public Storage Management, Inc. into the
Reporting Person were purchased for an aggregate cost (including
commissions) of approximately $1,303,630, with funds obtained from the
Reporting Person's working capital.
Item 4. Purpose of Transaction
The Reporting Person and the Issuer have entered into an
Agreement and Plan of Reorganization dated as of December 5, 1996 (the
"Merger Agreement") providing for the merger of the Issuer with and
into the Reporting Person, which is subject to certain conditions (as
described below). Upon the merger, each Series A Share (other than
Series A Shares held by the Reporting Person or by holders of Series A
Shares of the Issuer ("Series A Shareholders") who have properly
exercised dissenters' rights under California law ("Dissenting Shares"))
would be converted into the right to receive cash, the Reporting
Person's common stock or a combination of the two, as follows: (i) with
respect to a certain number of Series A Shares (not to exceed 20% of the
Series A Shares, less any Dissenting Shares), upon a shareholder's
election, $21.73 in cash, subject to reduction as described below or
(ii) that number (subject to rounding) of shares of the Reporting
Person's common stock determined by dividing $21.73, subject to
reduction as described below, by the average of the per share closing
prices on the New York Stock Exchange of the Reporting Person's common
stock during the 20 consecutive trading days ending on the fifth trading
day prior to the special meeting of the shareholders of the Issuer. The
consideration paid by the Reporting Person to the Series A Shareholders
in the merger will be reduced by the amount of cash distributions
required to be paid to the Series A Shareholders by the Issuer prior
to completion of the merger in order to satisfy the Issuer's REIT
distribution requirements ("Required REIT Distributions"). The
consideration received by the Series A Shareholders in the merger,
however, along with any Required REIT Distributions, will not be less
than $21.73 per Series A Share, which amount represents the interest of
the Series A Shareholders in the market value of the Issuer's real
estate assets at October 31, 1996 (based on an independent appraisal)
and the interest of the Series A Shareholders in the estimated net asset
value of its other assets at March 1997. Additional distributions would
be made to the Series A Shareholders to cause the Issuer's estimated net
asset value as of the date of the merger to be substantially equivalent
to $21.73 per share. Upon the merger, each share of the Issuer's Common
Stock Series B and Common Stock Series C would be converted into the
right to receive $16.07 in the Reporting Person's common stock (valued
as in the case of the Series A Shares) plus (i) any additional
distributions equal to the amount by which the Issuer's estimated net
asset value allocable to the holders of the Issuer's Common Stock
Series B and Common Stock Series C as of the date of the merger exceeds
$16.07 per share and (ii) any Required REIT Distributions payable to the
holders of the Issuer's Common Stock Series B. There are 892,256 shares
of the Issuer's Common Stock Series B and Common Stock Series C. The
Series A Shares and the shares of the Issuer's Common Stock Series B and
Common Stock Series C held by the Reporting Person will be cancelled in
the merger. The merger is subject to (among other things) approval by
the Issuer's shareholders and the Reporting Person's Board of Directors
and receipt of a satisfactory fairness opinion by the Issuer. The
Reporting Person believes that the conditions to the merger will be
satisfied, although there can be no assurance.
For further information regarding the merger, see the Merger
Agreement which is filed as Exhibit 4 hereto and is incorporated herein
by this reference.
Item 5. Interest in Securities of the Issuer
As of December 5, 1996, the Reporting Person beneficially
owned 208,568 Series A Shares, representing approximately 9.22% of the
2,263,218 Series A Shares outstanding. The Reporting Person has the
sole power to vote all of these shares, has the sole power to dispose
of 208,033 of these shares, and has no power to dispose of 535 of these
shares.
Item 7. Material to be Filed as Exhibits
(Exhibits 1 through 3 are listed in the Schedule 13D)
Exhibit 4 - Agreement and Plan of Reorganization dated as of
December 5, 1996 by and among the Reporting Person, the Issuer and
Public Storage Properties XV, Inc.
SIGNATURE
After reasonable inquiry and to the best of its knowledge and
belief, the undersigned certifies that the information set forth in
this statement is true, complete and correct.
Dated: December 13, 1996 PUBLIC STORAGE, INC.
By: /s/ SARAH HASS
-----------------------
Sarah Hass
Vice President
Exhibit 4
AGREEMENT AND PLAN OF REORGANIZATION
THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") is entered
into as of this 5th day of December, 1996, by and among PUBLIC STORAGE,
INC., a California corporation ("PSI"), PUBLIC STORAGE PROPERTIES XIV,
INC., a California corporation ("PSP14") and PUBLIC STORAGE PROPERTIES
XV, INC., a California corporation ("PSP15").
A. The parties intend that this Agreement shall constitute a
Plan of Reorganization for purposes of Section 368(a) of the Internal
Revenue Code of 1986, as amended. The Plan of Reorganization provides
for the mergers of PSP14 and PSP15 with and into PSI in accordance with
the applicable provisions of the General Corporation Law of California
(the "GCLC") and the Agreements of Merger substantially in the form
attached hereto as Exhibit A ("Merger Agreements").
B. The Boards of Directors of PSI, PSP14 and PSP15 believe that
it is in the best interests of such corporations and their respective
shareholders to enter into and complete this Agreement and they have
approved this Agreement and the transactions contemplated hereby.
NOW, THEREFORE, the parties agree as follows:
1. Adoption of Plan. The parties hereby adopt the Plan of
Reorganization hereinafter set forth.
2. The Merger.
2.1 Completion of the Merger. At the Effective Time (as
defined below), PSP14 and PSP15 will be merged with and into PSI (the
"Mergers") in accordance with the terms, conditions and provisions of
this Agreement and the Merger Agreements. The Mergers shall become
effective at the time at which the Merger Agreements, together with the
requisite Officers' Certificates of PSI, PSP14 and PSP15 are filed with
the California Secretary of State in accordance with the GCLC (the
"Effective Time"). PSI, PSP14 and PSP15 are sometimes collectively
referred to herein as the "Constituent Corporations" and PSI, as the
surviving corporation of the Mergers, is sometimes referred to herein
as the "Surviving Corporation." The merger of PSP14 into PSI and the
merger of PSP15 into PSI are not conditioned on each other.
2.2 Effect of the Merger. At the Effective Time:
2.2.1 Constituent Corporations. The separate
corporate existence of PSP14 and PSP15 shall cease and the Surviving
Corporation shall thereupon succeed, without other transfer, to all the
rights and property of PSP14 and PSP15 and shall be subject to all the
debts and liabilities of PSP14 and PSP15 in the same manner as if the
Surviving Corporation had itself incurred them; all rights of creditors
and all liens upon the property of each of the Constituent Corporations
shall be preserved unimpaired, provided that such liens upon property
of PSP14 and PSP15 shall be limited to the property affected thereby
immediately prior to the Effective Time; and any action or proceeding
pending by or against PSP14 and PSP15 may be prosecuted to judgment,
which shall bind the Surviving Corporation, or the Surviving Corporation
may be proceeded against or substituted in its place.
2.2.2 Articles and Bylaws. The Articles of
Incorporation and the Bylaws of PSI, as then amended, shall continue
to be the Articles of Incorporation and the Bylaws of the Surviving
Corporation until changed as provided by law and their respective
provisions.
2.2.3 Officers and Directors. The officers and
directors of PSI shall continue as officers and directors of the
Surviving Corporation until their successors are elected and qualified
as provided by law and in accordance with the Articles of Incorporation
and Bylaws of the Surviving Corporation.
2.3 Conversion of Common Stock Series A. The manner of
converting the outstanding shares of (i) Common Stock Series A ($.01 par
value) of PSP14 (the "PSP14 Shares") and (ii) Common Stock Series A
($.01 par value) of PSP15 (the "PSP15 Shares") into cash and/or shares
of Common Stock ($.10 par value) of PSI (the "PSI Shares") shall be as
follows:
2.3.1 Cash Election. At the Effective Time, subject
to Sections 2.6 and 6.8 hereof, each PSP14 Share and PSP15 Share as to
which a cash election has been made in accordance with the provisions
of Section 2.5 hereof and has not been revoked, relinquished or lost
pursuant to Section 2.5 hereof (the "Cash Election Shares") shall be
converted into and shall represent the right to receive $21.73 and
$21.99, respectively, in cash (the "Cash Election Price"). As soon as
practicable after the Effective Time, the registered holders of Cash
Election Shares shall be paid the cash to which they are entitled
hereunder in respect of such Cash Election Shares.
2.3.2 Share Exchange. At the Effective Time, subject
to Sections 2.4, 2.5, 2.7 and 6.8 hereof, each PSP14 Share and PSP15
Share (other than Cash Election Shares and PSP14 and PSP15 Shares owned
by PSI) shall be converted into that number of PSI Shares equal to,
rounded to the nearest thousandth, the quotient (the "Conversion
Number") derived by dividing $21.73 and $21.99, respectively, by the
average of the per share closing prices on the New York Stock Exchange,
Inc. (the "NYSE") of PSI Shares during the 20 consecutive trading days
ending on the fifth trading day prior to the meeting of shareholders of
PSP14 and PSP15, respectively, provided for in Section 6.2 hereof. If,
prior to the Effective Time, PSI should split or combine the PSI Shares,
or pay a stock dividend, the Conversion Number will be appropriately
adjusted to reflect such action.
2.4 No Fractional Shares. Notwithstanding any other term
or provision of this Agreement, no fractional PSI Shares and no
certificates or script therefor, or other evidence of ownership thereof,
will be issued in the Mergers. In lieu of any such fractional share
interests, each holder of PSP14 and PSP15 Shares who would otherwise
be entitled to such fractional share will, upon surrender of the
certificate representing such PSP14 and PSP15 Shares, receive a whole
PSI Share if such fractional share to which such holder would otherwise
have been entitled is .5 of an PSI Share or more, and such fractional
share shall be disregarded if it represents less than .5 of an PSI
Share; provided, however, that, such fractional share shall not be
disregarded if such fractional share to which such holder would
otherwise have been entitled represents .5 of 1% or more of the total
number of PSI Shares such holder is entitled to receive in the Mergers.
In such event, such holder shall be paid an amount in cash (without
interest), rounded to the nearest $.01, determined by multiplying (i)
the per share closing price on the NYSE of the PSI Shares at the
Effective Time by (ii) the fractional interest.
2.5 Procedure for Cash Election. At the time of the
mailing of the Combined Proxy Statement and Prospectus provided for in
Section 6.5 hereof, PSI will send to each holder of record of PSP14
and PSP15 Shares at the record date for PSP14 and PSP15 meetings of
shareholders referred to in Section 6.2 hereof a cash election form (the
"Form of Election") providing such holder with the option to elect to
receive the Cash Election Price with respect to all or any portion of
such holder's PSP14 or PSP15 Shares. Any such election to receive the
cash payment contemplated by Section 2.3.1 hereof shall have been
properly made only if American Stock Transfer & Trust Company (the
"Depositary") shall have received at its designated office, by 5:00
p.m., New York time, on the last business day preceding the day of such
meeting of shareholders, a Form of Election properly completed and
accompanied by certificates for the shares to which such Form of
Election relates (or an appropriate guarantee of delivery in a form and
on terms satisfactory to PSI), as set forth in such Form of Election.
Any Form of Election may be revoked by the person submitting the same to
the Depositary only by written notice received by the Depositary prior
to 5:00 p.m., New York time, on the last business day before the day of
the meeting of shareholders referred to in Section 6.2 hereof. In
addition, all Forms of Election shall automatically be revoked if the
Depositary is notified in writing by the parties hereto that the Mergers
have been abandoned. If a Form of Election is revoked pursuant to
this Section 2.5, the certificate or certificates or any guarantee of
delivery in respect of the PSP14 and PSP15 Shares to which such Form of
Election relates shall be promptly returned to the person submitting the
same to the Depositary. The Depositary may determine whether or not
elections to receive cash have been properly made or revoked pursuant
to this Section 2.5, and any such determination shall be conclusive and
binding. If the Depositary determines that any election to receive cash
was not properly or timely made, the PSP14 and PSP15 Shares covered
thereby shall not be treated as Cash Election Shares, and shall be
converted in the Mergers as provided in Section 2.3.2 hereof. The
Depositary may, with the agreement of PSI, PSP14 and PSP15, establish
such procedures, not inconsistent with this Section 2.5, as may be
necessary or desirable to implement this Section 2.5.
2.6 Procedure for Proration.
2.6.1 No Proration of PSP14 Shares. If the aggregate
number of Cash Election Shares and Dissenting Shares (as defined below)
of PSP14 is 20% or less than the number of PSP14 Shares outstanding as
of the record date for the meeting of shareholders of PSP14 referred
to in Section 6.2, then each Cash Election Share of PSP14 shall be
converted in the Mergers into the right to receive the Cash Election
Price for PSP14 Shares.
2.6.2 No Proration of PSP15 Shares. If the aggregate
number of Cash Election Shares and Dissenting Shares (as defined below)
of PSP15 is 20% or less than the number of PSP15 Shares outstanding as
of the record date for the meeting of shareholders of PSP15 referred
to in Section 6.2, then each Cash Election Share of PSP15 shall be
converted in the Mergers into the right to receive the Cash Election
Price for PSP15 Shares.
2.6.3 Proration of PSP14 Shares. If the aggregate
number of Cash Election Shares and Dissenting Shares of PSP14 exceeds
20%, then each Cash Election Share of PSP14 shall be converted in the
Mergers into the right to receive cash or into PSI Shares as follows:
the number of Cash Election Shares of PSP14 owned by a holder of PSP14
Shares that shall be converted into the right to receive the Cash
Election Price for PSP14 Shares shall equal the number obtained by
multiplying (i) (A) 20% of outstanding PSP14 Shares less (B) the number
of Dissenting Shares (as hereinafter defined) of PSP14, if any, by (ii)
a fraction of which the numerator shall be the number of Cash Election
Shares owned by such holder and the denominator shall be the aggregate
number of Cash Election Shares of PSP14. The balance of such Cash
Election Shares shall be converted into PSI Shares in accordance with
the provisions of Section 2.3.2 hereof. Notwithstanding the foregoing,
PSI, in its sole discretion, may allow Cash Election Shares of PSP14 to
receive the Cash Election Price for PSP14 Shares even if the aggregate
number of Cash Election Shares and Dissenting Shares of PSP14 exceeds
20% (but not 50%) of the number of PSP14 Shares outstanding as of the
record date for the meeting of shareholders of PSP14 referred to in
Section 6.2.
2.6.4 Proration of PSP15 Shares. If the aggregate
number of Cash Election Shares and Dissenting Shares of PSP15 exceeds
20%, then each Cash Election Share of PSP15 shall be converted in the
Mergers into the right to receive cash or into PSI Shares as follows:
the number of Cash Election Shares of PSP15 owned by a holder of PSP15
Shares that shall be converted into the right to receive the Cash
Election Price for PSP15 Shares shall equal the number obtained by
multiplying (i) (A) 20% of outstanding PSP15 Shares less (B) the number
of Dissenting Shares (as hereinafter defined) of PSP15, if any, by (ii)
a fraction of which the numerator shall be the number of Cash Election
Shares owned by such holder and the denominator shall be the aggregate
number of Cash Election Shares of PSP15. The balance of such Cash
Election Shares shall be converted into PSI Shares in accordance with
the provisions of Section 2.3.2 hereof. Notwithstanding the foregoing,
PSI, in its sole discretion, may allow Cash Election Shares of PSP15 to
receive the Cash Election Price for PSP15 Shares even if the aggregate
number of Cash Election Shares and Dissenting Shares of PSP15 exceeds
20% (but not 50%) of the number of PSP15 Shares outstanding as of the
record date for the meeting of shareholders of PSP15 referred to in
Section 6.2.
2.7 Dissenting Shares. PSP14 and PSP15 Shares held by a
holder who has demanded and perfected his right to an appraisal of such
shares in accordance with Section 1300 et seq. of the GCLC and who has
not effectively withdrawn or lost his right to appraisal ("Dissenting
Shares") shall not be converted into or represent the right to receive
cash and/or PSI Shares, but the holder thereof shall be entitled only to
such rights as are granted by Section 1300 et seq. of the GCLC. Each
holder of Dissenting Shares who becomes entitled to payment for PSP14
or PSP15 Shares pursuant to these provisions of the GCLC shall receive
payment therefor from the Surviving Corporation in accordance therewith.
If any holder of PSP14 or PSP15 Shares who demands appraisal in
accordance with Section 1300 et seq. of the GCLC shall effectively
withdraw with the consent of the Surviving Corporation or lose (through
failure to perfect or otherwise) his right to appraisal with respect to
PSP14 or PSP15 Shares, such PSP14 or PSP15 Shares shall automatically be
converted into the right to receive PSI Shares pursuant to Section 2.3.2
hereof.
2.8 PSI Shares Unaffected. The Mergers shall effect no
change in any of the outstanding PSI Shares and no outstanding PSI
Shares shall be converted or exchanged as a result of the Mergers, and
no cash shall be exchangeable, and no securities shall be issuable, with
respect thereto.
2.9 Cancellation of Shares Held or Owned by Parties. At
the Effective Time, any PSP14 and PSP15 Shares owned by PSI shall be
cancelled and retired and no shares shall be issuable, and no cash shall
be exchangeable, with respect thereto.
2.10 Exchange of Certificates. After the Effective Time,
each holder of a certificate theretofore evidencing outstanding PSP14
and PSP15 Shares which were converted into PSI Shares pursuant hereto,
upon surrender of such certificate to The First National Bank of Boston
(the "Exchange Agent") or such other agent or agents as shall be
appointed by the Surviving Corporation, shall be entitled to receive a
certificate representing the number of whole PSI Shares into which the
PSP14 and PSP15 Shares theretofore represented by the certificate so
surrendered shall have been converted as provided in Section 2.3.2
hereof and cash payment in lieu of fractional share interests, if any,
as provided in Section 2.4 hereof. As soon as practicable after the
Effective Time, the Exchange Agent will send a notice and a transmittal
form to each holder of PSP14 and PSP15 Shares of record at the Effective
Time whose stock shall have been converted into PSI Shares, advising
such holder of the effectiveness of the Mergers and the procedure for
surrendering to the Exchange Agent certificates evidencing PSP14 and
PSP15 Shares in exchange for certificates evidencing PSI Shares.
2.11 Status Until Surrendered. Until surrendered as
provided in Section 2.10 hereof, each outstanding certificate which,
prior to the Effective Time, represented PSP14 or PSP15 Shares (other
than Cash Election Shares and Dissenting Shares, if any) will be deemed
for all corporate purposes to evidence ownership of the number of whole
PSI Shares into which the PSP14 or PSP15 Shares evidenced thereby were
converted. However, until such outstanding certificates formerly
evidencing PSP14 or PSP15 Shares are so surrendered, no dividend payable
to holders of record of PSI Shares shall be paid to the holders of such
outstanding certificates in respect of PSP14 or PSP15 Shares, but upon
surrender of such certificates by such holders there shall be paid to
such holders the amount of any dividends (without interest) theretofore
paid with respect to such whole PSI Shares as of any record date on or
subsequent to the Effective Time and the amount of any cash (without
interest) payable to such holder in lieu of fractional share interests
pursuant to Section 2.4 hereof.
2.12 Transfer of Shares. After the Effective Time, there
shall be no further registration of transfers of PSP14 and PSP15 Shares
on the records of PSP14 and PSP15, respectively, and, if certificates
formerly evidencing such shares are presented to the Surviving
Corporation, they shall be cancelled and exchanged for certificates
evidencing PSI Shares and cash in lieu of fractional share interests as
herein provided.
2.13 Conversion of Common Stock Series B and C. At the
Effective Time, subject to Section 6.8 hereof, each share of (i) Common
Stock Series B and C ($.01 par value) of PSP14 and (ii) Common Stock
Series B and C ($.01 par value) of PSP15 (in each case, other than
shares owned by PSI) shall be converted into that number of PSI Shares
equal to, rounded to the nearest thousandth, the quotient derived by
dividing $16.07 and $12.63, respectively, by the average per share
closing prices on the NYSE of PSI Shares during the 20 consecutive
trading days ending on the fifth trading day prior to the meeting of
shareholders of PSP14 and PSP15, respectively, provided for in Section
6.2 hereof. If, prior to the Effective Time, PSI should split or
combine the PSI Shares, or pay a stock dividend, such conversion number
will be appropriately adjusted to reflect such action. At the Effective
Time, any Common Stock Series B and C of PSP14 and PSP15 owned by PSI
shall be cancelled and retired and no shares shall be issuable with
respect thereto.
3. Closing.
3.1 Time and Place of Closing. If this Agreement is
approved by the shareholders of PSP14 or PSP15, a meeting (the
"Closing") shall take place as promptly as practicable thereafter
at which the applicable parties will exchange certificates and other
documents as required by this Agreement. Such Closing shall take place
at such time and place as PSI may designate. The date of the Closing
shall be referred to as the "Closing Date."
3.2 Execution and Filing of Merger Agreement. At or before
the Closing and after shareholder approval of PSP14 or PSP15, the
applicable parties shall execute and deliver the Merger Agreements,
together with the requisite Officers' Certificates, for filing with the
California Secretary of State. The Merger Agreements, together with
the requisite Officers' Certificates, shall be duly filed with the
California Secretary of State in accordance with the GCLC as soon as
practicable following the Closing.
4. Representations, Warranties and Agreements of PSP14 and
PSP15.
4.1 Representations, Warranties and Agreements of PSP14.
PSP14 represents, warrants and agrees with PSI that:
4.1.1 Authorization. Subject to approval of this
Agreement by the shareholders of PSP14, (i) the execution, delivery and
performance of this Agreement by PSP14 has been duly authorized and
approved by all necessary corporate action of PSP14, and (ii) PSP14 has
necessary corporate power and authority to enter into this Agreement,
to perform its obligations hereunder and to complete the transactions
contemplated hereby.
4.1.2 Organization and Related Matters. PSP14 is a
corporation duly organized, existing and in good standing under the
laws of the State of California with all requisite corporate power and
authority to own, lease and operate its properties and to carry on its
business as and where now owned, leased, operated or carried on, as
the case may be; and is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the
property owned, leased or operated by it or the nature of the business
carried on by it requires such qualification and where the failure
to so qualify would have a material adverse effect on the business,
properties, results of operations or financial condition of PSP14.
PSP14 has no direct or indirect equitable or beneficial interest in
any other corporation other than PSCC, Inc.
4.1.3 Capital Stock. The authorized capital stock of
PSP14 consists solely of (i) 3,569,024 shares of Common Stock Series A
($.01 par value), 2,263,218 of which were issued and outstanding as of
November 30, 1996, (ii) 232,762 shares of Common Stock Series B ($.01
par value), all of which were issued and outstanding as of November 30,
1996 and (iii) 659,494 shares of Common Stock Series C ($.01 par value),
all of which were issued and outstanding as of November 30, 1996. All
of the issued and outstanding shares of Common Stock Series A, B and C
of PSP14 have been duly and validly authorized and issued, and are fully
paid and nonassessable. There are no options or agreements to which
PSP14 is a party or by which it is bound calling for or requiring the
issuance of any of PSP14's capital stock, except that the shares of
Common Stock Series B and C are convertible into shares of Common Stock
Series A in accordance with PSP14's Articles of Incorporation.
4.1.4 Consents and Approvals; No Violation. Assuming
approval of the Mergers and of this Agreement by the shareholders of
PSP14, neither the execution and delivery of this Agreement nor the
consummation by PSP14 of the transactions contemplated hereby will:
(i) conflict with or result in any breach of any provision of its
Articles of Incorporation or Bylaws; (ii) require any consent, waiver,
approval, authorization or permit of, or filing with or notification to,
any governmental or regulatory authority, except (A) in connection with
the applicable requirements, if any, of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), (B) pursuant to
the applicable requirements of the federal securities laws and the rules
and regulations promulgated thereunder, (C) the filing of the Merger
Agreement(s) and Officers' Certificates pursuant to the GCLC and
appropriate documents with the relevant authorities of other states in
which PSP14 is authorized to do business, (D) in connection with any
state or local tax which is attributable to the beneficial ownership of
PSP14's real property, (E) as may be required by any applicable state
securities or takeover laws, or (F) where the failure to obtain such
consent, approval, authorization or permit, or to make such filing or
notification, would not in the aggregate have a material adverse effect
on PSP14 or adversely affect the ability of PSP14 to consummate the
transactions contemplated hereby; (iii) result in a violation or breach
of, or constitute a default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms, conditions or
provisions of any note, license, mortgage, agreement or other instrument
or obligation to which PSP14 is a party or any of its properties or
assets may be bound, except for such violations, breaches and defaults
which, in the aggregate, would not have a material adverse effect on
PSP14 or adversely affect the ability of PSP14 to consummate the
transactions contemplated hereby; or (iv) assuming the consents,
approvals, authorizations or permits and filings or notifications
referred to in this Section 4.1.4 are duly and timely obtained or made,
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to PSP14 or its properties or assets, except for violations
which would not in the aggregate have a material adverse effect on PSP14
or adversely affect the ability of PSP14 to consummate the transactions
contemplated hereby.
4.1.5 Litigation. There is no litigation, proceeding
or governmental investigation which, individually or in the aggregate,
is or may be material and adverse, pending or, to the knowledge of
PSP14, threatened against PSP14 or involving any of its properties or
assets.
4.1.6 SEC Reports. Since January 1, 1993, PSP14 has
filed all forms, reports and documents with the Securities and Exchange
Commission ("SEC") required to be filed by it pursuant to the federal
securities laws and the rules and regulations promulgated by the SEC
thereunder, all of which complied in all material respects with all
applicable requirements of the federal securities laws and such rules
and regulations (collectively, the "PSP14 SEC Reports"). None of the
PSP14 SEC Reports, including without limitation any financial statements
or schedules included therein, at the time filed contained any untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading.
4.1.7 Financial Statements. The financial statements
included in the PSP14 SEC Reports complied as to form in all material
respects with applicable accounting requirements and the published rules
and regulations of the SEC with respect thereto, have been prepared in
accordance with generally accepted accounting principles applied on a
basis consistent with prior periods (except as otherwise noted therein),
and present fairly the financial position of PSP14 as of their
respective dates, and the results of operations of PSP14 for the periods
presented therein (subject, in the case of the unaudited interim
financial statements, to normal year-end adjustments).
4.1.8 Absence of Certain Changes or Events. Since
January 1, 1996, the business of PSP14 has been carried on only in the
ordinary and usual course and there has not been any material adverse
change in its business, results of operations or financial condition,
or any damage or destruction in the nature of a casualty loss, whether
covered by insurance or not, that would materially and adversely affect
its properties, business or results of operations.
4.1.9 S-4 Registration Statement and Combined Proxy
Statement and Prospectus. None of the information supplied or to be
supplied by PSP14 for inclusion or incorporation by reference in the S-4
Registration Statement or the Combined Proxy Statement and Prospectus
(as such terms are defined in Section 6.5 hereof) will (i) in the case
of the S-4 Registration Statement, at the time it becomes effective and
at the Effective Time, 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, or
(ii) in the case of the Combined Proxy Statement and Prospectus, at the
time of the mailing of the Combined Proxy Statement and Prospectus and
at the time of the meetings of the shareholders of PSP14 and PSP15,
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, in light of the circumstances under which
they are made, not misleading.
4.1.10 Insurance. All material insurance of PSP14 is
currently in full force and effect and PSP14 has reported all claims and
occurrences to the extent required by such insurance.
4.1.11 Disclosure. The representations and warranties
by PSP14 in this Agreement and any certificate or document delivered by
it pursuant hereto do not and will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements contained herein or therein not misleading.
4.2 Representations, Warranties and Agreements of PSP15.
PSP15 represents, warrants and agrees with PSI that:
4.2.1 Authorization. Subject to approval of this
Agreement by the shareholders of PSP15, (i) the execution, delivery and
performance of this Agreement by PSP15 has been duly authorized and
approved by all necessary corporate action of PSP15, and (ii) PSP15 has
necessary corporate power and authority to enter into this Agreement,
to perform its obligations hereunder and to complete the transactions
contemplated hereby.
4.2.2 Organization and Related Matters. PSP15 is a
corporation duly organized, existing and in good standing under the
laws of the State of California with all requisite corporate power and
authority to own, lease and operate its properties and to carry on its
business as and where now owned, leased, operated or carried on, as
the case may be; and is duly qualified to do business as a foreign
corporation and is in good standing in each jurisdiction in which the
property owned, leased or operated by it or the nature of the business
carried on by it requires such qualification and where the failure to
so qualify would have a material adverse effect on the business,
properties, results of operations or financial condition of PSP15.
PSP15 has no direct or indirect equitable or beneficial interest in any
other corporation other than PSCC, Inc.
4.2.3 Capital Stock. The authorized capital stock of
PSP15 consists solely of (i) 3,569,024 shares of Common Stock Series A
($.01 par value), 2,136,885 of which were issued and outstanding as of
November 30, 1996, (ii) 232,762 shares of Common Stock Series B ($.01
par value), all of which were issued and outstanding as of November 30,
1996 and (iii) 659,494 shares of Common Stock Series C ($.01 par value),
all of which were issued and outstanding as of November 30, 1996. All
of the issued and outstanding shares of Common Stock Series A, B and C
of PSP15 have been duly and validly authorized and issued, and are fully
paid and nonassessable. There are no options or agreements to which
PSP15 is a party or by which it is bound calling for or requiring the
issuance of any of PSP15's capital stock, except that the shares of
Common Stock Series B and C are convertible into shares of Common Stock
Series A in accordance with PSP15's Articles of Incorporation.
4.2.4 Consents and Approvals; No Violation. Assuming
approval of the Mergers and of this Agreement by the shareholders of
PSP15, neither the execution and delivery of this Agreement nor the
consummation by PSP15 of the transactions contemplated hereby will:
(i) conflict with or result in any breach of any provision of its
Articles of Incorporation or Bylaws; (ii) require any consent, waiver,
approval, authorization or permit of, or filing with or notification to,
any governmental or regulatory authority, except (A) in connection with
the applicable requirements, if any, of the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), (B) pursuant to
the applicable requirements of the federal securities laws and the rules
and regulations promulgated thereunder, (C) the filing of the Merger
Agreement(s) and Officers' Certificates pursuant to the GCLC and
appropriate documents with the relevant authorities of other states in
which PSP15 is authorized to do business, (D) in connection with any
state or local tax which is attributable to the beneficial ownership of
PSP15's real property, (E) as may be required by any applicable state
securities or takeover laws, or (F) where the failure to obtain such
consent, approval, authorization or permit, or to make such filing or
notification, would not in the aggregate have a material adverse effect
on PSP15 or adversely affect the ability of PSP15 to consummate the
transactions contemplated hereby; (iii) result in a violation or breach
of, or constitute a default (or give rise to any right of termination,
cancellation or acceleration) under any of the terms, conditions or
provisions of any note, license, mortgage, agreement or other instrument
or obligation to which PSP15 is a party or any of its properties or
assets may be bound, except for such violations, breaches and defaults
which, in the aggregate, would not have a material adverse effect on
PSP15 or adversely affect the ability of PSP15 to consummate the
transactions contemplated hereby; or (iv) assuming the consents,
approvals, authorizations or permits and filings or notifications
referred to in this Section 4.2.4 are duly and timely obtained or made,
violate any order, writ, injunction, decree, statute, rule or regulation
applicable to PSP15 or its properties or assets, except for violations
which would not in the aggregate have a material adverse effect on PSP15
or adversely affect the ability of PSP15 to consummate the transactions
contemplated hereby.
4.2.5 Litigation. There is no litigation, proceeding
or governmental investigation which, individually or in the aggregate,
is or may be material and adverse, pending or, to the knowledge of
PSP15, threatened against PSP15 or involving any of its properties or
assets.
4.2.6 SEC Reports. Since January 1, 1993, PSP15 has
filed all forms, reports and documents with the SEC required to be
filed by it pursuant to the federal securities laws and the rules and
regulations promulgated by the SEC thereunder, all of which complied in
all material respects with all applicable requirements of the federal
securities laws and such rules and regulations (collectively, the
"PSP15 SEC Reports"). None of the PSP15 SEC Reports, including without
limitation any financial statements or schedules included therein, at
the time filed contained any untrue statement of a material fact or
omitted to state a material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
4.2.7 Financial Statements. The financial statements
included in the PSP15 SEC Reports complied as to form in all material
respects with applicable accounting requirements and the published rules
and regulations of the SEC with respect thereto, have been prepared in
accordance with generally accepted accounting principles applied on a
basis consistent with prior periods (except as otherwise noted therein),
and present fairly the financial position of PSP15 as of their
respective dates, and the results of operations of PSP15 for the periods
presented therein (subject, in the case of the unaudited interim
financial statements, to normal year-end adjustments).
4.2.8 Absence of Certain Changes or Events. Since
January 1, 1996, the business of PSP15 has been carried on only in the
ordinary and usual course and there has not been any material adverse
change in its business, results of operations or financial condition,
or any damage or destruction in the nature of a casualty loss, whether
covered by insurance or not, that would materially and adversely affect
its properties, business or results of operations.
4.2.9 S-4 Registration Statement and Combined Proxy
Statement and Prospectus. None of the information supplied or to be
supplied by PSP15 for inclusion or incorporation by reference in the S-4
Registration Statement or the Combined Proxy Statement and Prospectus
(as such terms are defined in Section 6.5 hereof) will (i) in the case
of the S-4 Registration Statement, at the time it becomes effective and
at the Effective Time, 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, or
(ii) in the case of the Combined Proxy Statement and Prospectus, at the
time of the mailing of the Combined Proxy Statement and Prospectus and
at the time of the meetings of the shareholders of PSP14 and PSP15,
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, in light of the circumstances under which
they are made, not misleading.
4.2.10 Insurance. All material insurance of PSP15 is
currently in full force and effect and PSP15 has reported all claims and
occurrences to the extent required by such insurance.
4.2.11 Disclosure. The representations and warranties
by PSP15 in this Agreement and any certificate or document delivered by
it pursuant hereto do not and will not contain any untrue statement of
a material fact or omit to state a material fact necessary to make the
statements contained herein or therein not misleading.
5. Representations, Warranties and Agreements of PSI. PSI
hereby represents, warrants and agrees with PSP14 and PSP15 that:
5.1 Authorization. The execution, delivery and performance
of this Agreement by PSI have been duly authorized and approved by all
necessary corporate action of PSI, and PSI has all necessary corporate
power and authority to enter into this Agreement, to perform its
obligations hereunder and to complete the transactions contemplated
hereby.
5.2 Organization and Related Matters. PSI is a corporation
duly organized, existing and in good standing under the laws of the
State of California, with all requisite corporate power and authority to
own, lease and operate its properties and to carry on its business as
and where now owned, leased, operated or carried on, as the case may be;
and is duly qualified to do business as a foreign corporation and is in
good standing in each jurisdiction in which the property owned, leased
or operated by it or the nature of the business carried on by it
requires such qualification and where the failure to so qualify would
have a material adverse effect on the business, properties, results of
operations or financial condition of PSI.
5.3 Capital Stock. The authorized capital stock of PSI
consists solely of (i) 200,000,000 shares of Common Stock ($.10 par
value), 84,411,391 of which were issued and outstanding as of September
30, 1996, (ii) 7,000,000 shares of Class B Common Stock ($.10 par
value), all of which were issued and outstanding as of September 30,
1996 and (iii) 50,000,000 shares of Preferred Stock ($.10 par value),
13,441,180 of which were issued and outstanding as of September 30,
1996. All of the issued and outstanding shares of Common Stock and
Preferred Stock of PSI have been duly and validly authorized and issued,
and are fully paid and nonassessable. The issuance of the PSI Shares in
the Mergers has been duly and validly authorized and, when issued and
delivered as provided in this Agreement, the PSI Shares will have
been duly and validly issued, fully paid and nonassessable; and the
shareholders of PSI have no preemptive rights with respect to any shares
of capital stock of PSI.
5.4 Consents and Approvals; No Violation. Neither the
execution and delivery of this Agreement nor the consummation by PSI of
the transactions contemplated hereby will: (i) conflict with or result
in any breach of any provision of its Articles of Incorporation or
Bylaws; (ii) require any consent, waiver, approval, authorization or
permit of, or filing with or notification to, any governmental or
regulatory authority, except (A) in connection with the applicable
requirements, if any, of the HSR Act, (B) pursuant to the applicable
requirements of the federal securities laws and the rules and
regulations promulgated thereunder, (C) the filing of the Merger
Agreements and Officers' Certificates pursuant to the GCLC and
appropriate documents with the relevant authorities of other states
in which PSI is authorized to do business, (D) in connection with any
state or local tax which is attributable to the beneficial ownership
of the real property of PSP14 and PSP15, (E) as may be required by any
applicable state securities or takeover laws, or (F) where the failure
to obtain such consent, approval, authorization or permit, or to make
such filing or notification, would not in the aggregate have a material
adverse effect on PSI or adversely affect the ability of PSI to
consummate the transactions contemplated hereby; (iii) result in a
violation or breach of, or constitute a default (or give rise to any
right of termination, cancellation or acceleration) under any of the
terms, conditions or provisions of any note, license, mortgage,
agreement or other instrument or obligation to which PSI is a party
or any of its properties or assets may be bound, except for such
violations, breaches and defaults which, in the aggregate, would not
have a material adverse effect on PSI or adversely affect the ability of
PSI to consummate the transactions contemplated hereby; or (iv) assuming
the consents, approvals, authorizations or permits and filings or
notifications referred to in this Section 5.4 are duly and timely
obtained or made, violate any order, writ, injunction, decree, statute,
rule or regulation applicable to PSI or its properties or assets, except
for violations which would not in the aggregate have a material adverse
effect on PSI or adversely affect the ability of PSI to consummate the
transactions contemplated hereby.
5.5 Litigation. There is no litigation, proceeding or
governmental investigation which, individually or in the aggregate, is
or may be material and adverse, pending or, to the knowledge of PSI,
threatened against PSI or involving any of its properties or assets.
5.6 SEC Reports. Since January 1, 1993, PSI has filed all
forms, reports and documents with the SEC required to be filed by it
pursuant to the federal securities laws and the rules and regulations
promulgated by the SEC thereunder, all of which complied in all material
respects with all applicable requirements of the federal securities laws
and such rules and regulations (collectively, the "PSI SEC Reports").
None of the PSI SEC Reports, including without limitation any financial
statements or schedules included therein, at the time filed contained
any untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading.
5.7 Financial Statements. The financial statements
included in PSI's SEC Reports complied as to form in all material
respects with applicable accounting requirements and the published rules
and regulations of the SEC with respect thereto, have been prepared in
accordance with generally accepted accounting principles applied on a
basis consistent with prior periods (except as otherwise noted therein),
and present fairly the financial position of PSI as of their respective
dates, and the results of operations of PSI for the periods presented
therein (subject, in the case of the unaudited interim financial
statements, to normal year-end adjustments).
5.8 Absence of Certain Changes or Events. Since January 1,
1995, the business of PSI has been carried on only in the ordinary and
usual course and there has not been any material adverse change in its
business, results of operations or financial condition, or any damage
or destruction in the nature of a casualty loss, whether covered by
insurance or not, that would materially and adversely affect its
properties, business or results of operations.
5.9 S-4 Registration Statement and Combined Proxy Statement
and Prospectus. None of the information supplied or to be supplied by
PSI for inclusion or incorporation by reference in the S-4 Registration
Statement or the Combined Proxy Statement and Prospectus (as those terms
are defined in Section 6.5 hereof) will (i) in the case of the S-4
Registration Statement, at the time it becomes effective and at the
Effective Time, 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, or (ii) in the case
of the Combined Proxy Statement and Prospectus, at the time of the
mailing of the Combined Proxy Statement and Prospectus and at the time
of the meetings of the shareholders of PSP14 and PSP15, 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, in light of the circumstances under which they are
made, not misleading.
5.10 Insurance. All material insurance of PSI is currently
in full force and effect and PSI has reported all claims and occurrences
to the extent required by such insurance.
5.11 Disclosure. The representations and warranties by
PSI in this Agreement and any certificate or document delivered by it
pursuant hereto do not and will not contain any untrue statement of a
material fact or omit to state a material fact necessary to make the
statements contained herein or therein not misleading.
6. Covenants and Agreements.
6.1 Ordinary Course. Except as contemplated by this
Agreement, during the period from the date of this Agreement to the
Effective Time, each of PSI, PSP14 and PSP15 will carry on its business
in the ordinary course in substantially the same manner as heretofore
conducted and use all reasonable efforts to: (a) preserve intact its
present business, organization and goodwill, (b) maintain all permits,
licenses and authorizations required by applicable laws, and (c) keep
available the services of its present employees and preserve its
relationships with customers, suppliers, lenders, lessors, governmental
entities and others having business or regulatory dealings with it.
PSP14 and PSP15 will not issue any capital stock or debt securities
convertible into capital stock. PSI, PSP14 and PSP15 will promptly
notify the others of any event or occurrence not in the ordinary and
usual course of business or which may have a material adverse effect on
the properties or financial condition of such party.
6.2 Meetings of Shareholders. PSP14 and PSP15 will take
all action necessary in accordance with applicable law to convene a
meeting of its shareholders as promptly as practicable to consider and
vote upon approval of this Agreement, it being understood that the
principal terms of the Agreement must be approved by (i) in the case of
PSP14, the affirmative vote of a majority of the outstanding shares of
Common Stock Series A, B and C of PSP14, counted together as a single
class with the shares of Common Stock Series B and C voted with the
holders of a majority of the unaffiliated shares of Common Stock
Series A; and (ii) in the case of PSP15, the affirmative vote of a
majority of the outstanding shares of Common Stock Series A, B and C
of PSP15, counted together as a single class with the shares of Common
Stock Series B and C voted with the holders of a majority of the
unaffiliated shares of Common Stock Series A.
6.3 Tax Reporting. Each of PSI, PSP14 and PSP15 agrees
to report the Mergers for federal and state income tax purposes, as a
reorganization of the type described in Section 368(a)(1)(A) of the
Internal Revenue Code of 1986, as amended.
6.4 Acquisition Proposals. PSP14 and PSP15 will not
initiate, solicit or encourage, directly or indirectly, any inquiries
or the making of any proposal with respect to a merger, consolidation,
share exchange or similar transaction involving PSP14 or PSP15, or any
purchase of all or any significant portion of either of their assets, or
any equity interest in either of them, other than the transactions
contemplated hereby (an "Acquisition Proposal"), or engage in any
negotiations concerning, or provide any confidential information or data
to, or have any discussions with, any person relating to an Acquisition
Proposal; provided, however, that the respective Board of Directors
on behalf of PSP14 or PSP15 may furnish or cause to be furnished
information and may participate in such discussions and negotiations
through its representatives with persons who have sought the same if the
failure to provide such information or participate in such negotiations
and discussions might cause the members of the Board of Directors of
PSP14 or PSP15 to breach their fiduciary duty to the shareholders of
the respective corporation under applicable law as advised by counsel.
PSP14 and PSP15 will notify PSI immediately if any such inquiries or
proposals are received by, any such information is requested from, or
any such negotiations or discussions are sought to be initiated or
continued with PSP14 or PSP15, and will keep PSI informed of the
status and terms of any such proposals and any such negotiations or
discussions.
6.5 Registration and Proxy Statements. PSP14 and PSP15
will promptly prepare and file with the SEC a combined preliminary proxy
statement in connection with the vote of shareholders of PSP14 and PSP15
with respect to the Mergers. PSI will, as promptly as practicable,
prepare and file with the SEC a registration statement on Form S-4 (the
"S-4 Registration Statement"), containing a combined proxy
statement/prospectus, in connection with the registration under the
Securities Act of 1933, as amended (the "Securities Act") of the PSI
Shares to be issued to holders of PSP14 and PSP15 Shares in the Mergers
(such combined proxy statement/prospectus, together with any amendments
thereof or supplements thereto, in each case in the form or forms to be
mailed to the shareholders of PSP14 and PSP15, being herein called the
"Combined Proxy Statement and Prospectus"). PSI, PSP14 and PSP15 will
use their best efforts to have or cause the S-4 Registration Statement
to be declared effective as promptly as practicable, and also will take
any other action required to be taken under federal or state securities
laws, and PSP14 and PSP15 will each use its best efforts to cause the
Combined Proxy Statement and Prospectus to be mailed to its respective
shareholders at the earliest practicable date. PSP14 and PSP15 agree
that if at any time prior to the Effective Time any event with respect
to PSP14 and PSP15, respectively, should occur which is required to be
described in an amendment of, or a supplement to, the Combined Proxy
Statement and Prospectus or the S-4 Registration Statement, such event
shall be so described, and such amendment or supplement shall be
promptly filed with the SEC and, as required by law, disseminated to the
shareholders of PSP14 and PSP15 and (ii) the Combined Proxy Statement
and Prospectus will (with respect to PSP14 and PSP15) comply as to form
in all material respects with the requirements of the federal securities
laws. PSI agrees that (i) if at any time prior to the Effective Time
any event with respect to PSI should occur which is required to be
described in an amendment of, or a supplement to, the Combined Proxy
Statement and Prospectus or the S-4 Registration Statement, such event
shall be so described, and such amendment or supplement shall be
promptly filed with the SEC and, as required by law, disseminated to the
shareholders of PSP14 and PSP15 and (ii) the Combined Proxy Statement
and Prospectus will (with respect to PSI) comply as to form in all
material respects with the requirements of the federal securities laws.
6.6 Best Efforts. Each of PSI, PSP14 and PSP15 shall:
(i) promptly make its respective filings and thereafter make any other
required submissions under all applicable laws with respect to the
Mergers and the other transactions contemplated hereby; and (ii) use
its best efforts to promptly take, or cause to be taken, all other
actions and do, or cause to be done, all other things necessary, proper
or appropriate to consummate and make effective the transactions
contemplated by this Agreement as soon as practicable.
6.7 Registration and Listing of PSI Shares. PSI will
use its best efforts to register the PSI Shares under the applicable
provisions of the Securities Act and to cause the PSI Shares to be
listed for trading on the NYSE upon official notice of issuance.
6.8 Distributions.
6.8.1 PSP14 Distributions. PSP14 will not, at any
time prior to the Effective Time, declare or pay any cash distribution
on its capital stock or make any other distribution of assets to its
shareholders, except (i) regular quarterly dividends on its Common Stock
at a quarterly rate not in excess of $.34 per share, (ii) distributions
to shareholders of record immediately prior to the Effective Time in an
aggregate amount equal to the amount by which the estimated Net Asset
Value of PSP14 (as defined below) allocable to the respective
shareholders as of the Effective Time exceeds $21.73 per share in the
case of the PSP14 Shares and $16.07 per share in the case of the PSP14
Common Stock Series B and C and (iii) pre-Mergers cash distributions
required to satisfy PSP14's REIT distribution requirements (the number
of PSI Shares issued in the Mergers and the amount receivable upon Cash
Elections would be reduced on a pro rata basis in an aggregate amount
equal to such additional distributions). For this purpose, the Net
Asset Value of PSP14 is the sum of (a) the fair market value of PSP14's
real estate assets as determined by appraisal by Charles R. Wilson &
Associates, Inc. as of October 31, 1996, and (b) the book value of
PSP14's non-real estate assets as of the date of determination, and less
(c) PSP14's liabilities as of the date of determination. The
determination of book value and liabilities shall be from PSP14's
financial statements prepared in accordance with generally accepted
accounting principles on a basis consistent with prior periods.
6.8.2 PSP15 Distributions. PSP15 will not, at any
time prior to the Effective Time, declare or pay any cash distribution
on its capital stock or make any other distribution of assets to its
shareholders, except (i) regular quarterly dividends on its Common Stock
at a quarterly rate not in excess of $.30 per share, (ii) distributions
to shareholders of record immediately prior to the Effective Time in an
aggregate amount equal to the amount by which the estimated Net Asset
Value of PSP15 (as defined below) allocable to the respective
shareholders as of the Effective Time exceeds $21.99 per share in the
case of the PSP15 Shares and $12.63 per share in the case of the PSP15
Common Stock Series B and C and (iii) pre-Mergers cash distributions
required to satisfy PSP15's REIT distribution requirements (the number
of PSI Shares issued in the Mergers and the amount receivable upon Cash
Elections would be reduced on a pro rata basis in an aggregate amount
equal to such additional distributions). For this purpose, the Net
Asset Value of PSP15 is the sum of (a) the fair market value of PSP15's
real estate assets as determined by appraisal by Charles R. Wilson &
Associates, Inc. as of October 31, 1996, and (b) the book value of
PSP15's non-real estate assets as of the date of determination, and
less (c) PSP15's liabilities as of the date of determination. The
determination of book value and liabilities shall be from PSP15's
financial statements prepared in accordance with generally accepted
accounting principles on a basis consistent with prior periods.
7. Conditions.
7.1 Conditions to Each Party's Obligations. The respective
obligations of each party to consummate the transactions contemplated by
this Agreement are subject to the fulfillment at or prior to the Closing
of each of the following conditions, any or all of which may be waived
in whole or in part, to the extent permitted by applicable law:
7.1.1 PSP14 and PSP15 Shareholder Approval. This
Agreement and the transactions contemplated hereby shall have been duly
approved by the shareholders of PSP14 and PSP15 as contemplated by
Section 6.2.
7.1.2 Governmental and Regulatory Consents. All
filings required to be made prior to the Effective Time with, and all
consents, approvals, permits and authorizations required to be obtained
prior to the Effective Time from, governmental and regulatory
authorities in connection with the execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby
(including the expiration of the waiting period requirements of the
HSR Act) shall have been made or obtained (as the case may be) without
material restrictions, except where the failure to obtain such consents,
approvals, permits and authorizations could not reasonably be expected
to have a material adverse effect on PSI, PSP14 or PSP15.
7.1.3 Litigation. No court or governmental or
regulatory authority of competent jurisdiction shall have enacted,
issued, promulgated, enforced or entered any statute, rule, regulation,
judgment, decree, injunction or other order (whether temporary,
preliminary or permanent) or taken any action which prohibits the
consummation of the transactions contemplated by this Agreement;
provided, however, that the party invoking this condition shall use
its best efforts to have any such judgment, decree, injunction or other
order vacated.
7.1.4 Registration Statement. The S-4 Registration
Statement shall have been declared effective and no stop order
suspending effectiveness shall have been issued, no action, suit,
proceeding or investigation by the SEC to suspend the effectiveness
thereof shall have been initiated and be continuing, and all necessary
approvals under federal and state securities laws relating to the
issuance or trading of the PSI Shares shall have been received.
7.1.5 Listing of PSI Shares on NYSE. The PSI Shares
shall have been approved for listing on the NYSE upon official notice of
issuance.
7.1.6 Fairness Opinion. The Boards of Directors of
PSP14 and PSP15 shall have received the opinion of Robert A. Stanger &
Co., Inc. in form and substance satisfactory to them to the effect that
the consideration to be received by the shareholders of PSP14 and PSP15
in the Mergers is fair to such shareholders from a financial point of
view, and such opinion shall not have been withdrawn or revoked.
7.1.7 Tax Opinion. The Boards of Directors of PSI,
PSP14 and PSP15 shall have received a legal opinion of Hogan & Hartson
that the Merger will qualify as a tax-free reorganization under Section
368(a) of the Internal Revenue Code of 1986, as amended.
7.1.8 PSI Board Approval. This Agreement and the
transactions contemplated hereby shall have been duly approved by the
Board of Directors of PSI.
7.2 Conditions to Obligations of PSI. The obligations of
PSI to consummate the transactions contemplated by this Agreement are
subject to the fulfillment at or prior to the Closing of the following
conditions, which may be waived in whole or in part by PSI to the extent
permitted by applicable law:
7.2.1 Accuracy of Representations; Performance of
Agreements. Each of the representations and warranties of PSP14 and
PSP15 contained in this Agreement shall be true and correct in all
material respects at and as of the Closing Date as if made at and as of
the Closing Date (except to the extent they relate to a particular date)
and PSP14 and PSP15 shall have performed or complied with all agreements
and covenants required by this Agreement to be performed or complied
with by it at or prior to the Closing.
7.2.2 Certificate of Officers. PSI shall have
received such certificates of officers of PSP14 and PSP15 as PSI may
reasonably request in connection with the Closing, including upon
request a certificate satisfactory to it of the Chief Executive Officer
and the Chief Financial Officer of PSP14 and PSP15, to the effect that,
to the best of their knowledge, all representations and warranties of
PSP14 and PSP15 contained in this Agreement are true and correct in all
material respects at and as of the Closing Date as if made at and as of
the Closing Date, and PSP14 and PSP15 have performed or complied with
all agreements and covenants required by this Agreement to be performed
or complied with by them at or prior to the Closing.
7.2.3 Title to Properties; Environmental Audits. PSI
in its sole discretion shall be satisfied as to the status of title to
(including the existence and effect of liens and encumbrances), and the
results of an environmental audit of, each of the real properties owned
by PSP14 and PSP15.
7.2.4 Trading Price of PSI Shares. The average of
the per share closing prices of the PSI Shares on the NYSE during the 20
consecutive trading days ending on the fifth trading day prior to the
meeting of shareholders of PSP14 and PSP15 provided for in Section 6.2
hereof (the "Average PSI Share Price") shall be not less than $24.
7.2.5 Dissenting Shares. The number of Dissenting
Shares shall be less than 5% of the outstanding PSP14 Shares in the case
of PSP14 and less than 5% of the outstanding PSP15 Shares in the case of
PSP15.
7.3 Conditions to Obligations of PSP14 and PSP15. The
obligations of PSP14 and PSP15 to consummate the transactions
contemplated by this Agreement are subject to the fulfillment at or
prior to the Closing of the following conditions, which may be waived
in whole or in part by PSP14 and PSP15 to the extent permitted by
applicable law.
7.3.1 Accuracy of Representations; Performance of
Agreements. Each of the representations and warranties of PSI contained
in this Agreement shall be true and correct in all material respects at
and as of the Closing Date as if made at and as of the Closing Date
(except to the extent they relate to a particular date) and PSI shall
have performed or complied in all material respects with all agreements
and covenants required by this Agreement to be performed or complied
with by it at or prior to the Closing.
7.3.2 Certificate of Officers. PSP14 and PSP15 shall
have received such certificates of officers of PSI as PSP14 and PSP15
may reasonably request in connection with the Closing, including upon
request a certificate satisfactory to them of the Chief Executive
Officer and the Chief Financial Officer of PSI, to the effect that, to
the best of their knowledge, all representations and warranties of PSI
contained in this Agreement are true and correct in all material
respects at and as of the Closing Date as if made at and as of the
Closing Date, and PSI has performed or complied with all agreements and
covenants required by this Agreement to be performed or complied with
by it at or prior to the Closing.
7.4 Separate Mergers. The merger of PSP14 into PSI and
the merger of PSP15 into PSI are not conditioned on the others. If
the conditions to one of the Mergers are satisfied or waived, such
merger will be consummated on the terms provided in this Agreement,
notwithstanding that the conditions to the other Merger have not been
satisfied or waived.
8. Termination.
8.1 Termination by Mutual Consent. This Agreement may be
terminated and the Mergers may be abandoned at any time prior to the
Effective Time, before or after shareholder approval, by the mutual
written consent of PSI, PSP14 or PSP15.
8.2 Termination by PSI, PSP14 or PSP15. This Agreement may
be terminated and the Mergers may be abandoned by action of the Board of
Directors of PSI, PSP14 or PSP15 if (i) the Mergers shall not have been
consummated by December 31, 1997 (provided that the right to terminate
this Agreement under this Section 8.2(i) shall not be available to any
party whose failure to fulfill any obligation under this Agreement has
been the cause of or resulted in the failure of the Mergers to occur on
or before such date); (ii) any court of competent jurisdiction in the
United States or some other governmental body or regulatory authority
shall have issued an order, decree or ruling or taken any other action
permanently restraining, enjoining or otherwise prohibiting the Mergers
and such order, decree, ruling or other action shall have become final
and nonappealable; or (iii) (A) the shareholders of PSP14, in the case
of the merger of PSP14 into PSI, or (B) the shareholders of PSP15, in
the case of the merger of PSP15 into PSI, shall have failed to approve
this Agreement and the transactions contemplated hereby at their
respective meetings of shareholders.
8.3 Termination by PSI. This Agreement may be terminated
by PSI, and the Mergers may be abandoned at any time prior to the
Effective Time, as to the defaulting party if (i) PSP14 or PSP15 shall
have failed to comply in any material respect with any of the covenants,
conditions or agreements contained in this Agreement to be complied with
or performed by such party at or prior to such date of termination,
which failure to comply has not been cured within five business days
following notice to such party of such failure to comply, or (ii) any
representation or warranty of PSP14 or PSP15 contained in this Agreement
shall not be true in all material respects when made, which inaccuracy
or breach (if capable of cure) has not been cured within five business
days following notice to such party of the inaccuracy or breach, or on
and as of the Closing as if made on and as of the Closing Date.
8.4 Termination by PSP14 or PSP15. This Agreement may be
terminated by PSP14 or PSP15 and the Mergers may be abandoned at any
time prior to the Effective Time, before or after shareholder approval,
if (i) PSI shall have failed to comply in any material respect with any
of the covenants, conditions or agreements contained in this Agreement
to be complied with or performed by PSI at or prior to such date of
termination, which failure to comply has not been cured within five
business days following notice to PSI of such failure to comply, or (ii)
any representation or warranty of PSI contained in this Agreement shall
not be true in all material respects when made, which inaccuracy or
beach (if capable of cure) has not been cured within five business days
following notice to PSI of the inaccuracy or breach, or on and as of the
Closing as if made on and as of the Closing Date.
8.5 Effect of Termination and Abandonment. In the event of
termination of this Agreement and abandonment of the Mergers pursuant to
this Section 8, no party (or any directors, officers, employees, agents
or representatives of any party) shall have any liability or further
obligation to any other party or any person who controls a party within
the meaning of the Securities Act, except as provided in Section 9.1 and
except that nothing herein will relieve any party from liability for any
breach of this Agreement.
9. Miscellaneous.
9.1 Payment of Expenses. If the Mergers are consummated,
the Surviving Corporation shall pay all the expenses incident to
preparing for, entering into and carrying out this Agreement and the
consummation of the transactions contemplated hereby. If the Mergers
are not consummated, each of PSI, PSP14 and PSP15 shall pay its own
expenses, except that any expenses incurred in connection with the
printing of the S-4 Registration Statement and the Combined Proxy
Statement and Prospectus, the real estate appraisals and environmental
audits of the properties of PSP14 and PSP15 and preparation for real
estate closings, and any filing fees under the HSR Act, the Securities
Act and the Securities Exchange Act of 1934, as amended shall be paid
50% by PSI and the balance by PSP14 and PSP15 in equal shares.
9.2 Survival of Representations, Warranties and Covenants.
The respective representations and warranties of PSI, PSP14 and PSP15
contained herein or in any certificate or document delivered pursuant
hereto shall expire with and be terminated and extinguished by the
effectiveness of the Mergers and shall not survive the Effective Time.
The sole right and remedy arising from a misrepresentation or breach of
warranty, or from the failure of any of the conditions to be met, shall
be the termination of this Agreement by the other party. This Section
9.2 shall not limit any covenant or agreement of the parties, which by
its terms contemplates performance after the Effective Time.
9.3 Modification or Amendment. The parties may modify or
amend this Agreement by written agreement authorized by the Boards of
Directors and executed and delivered by officers of the respective
parties; provided, however, that after approval of this Agreement by
the shareholders of a party, no amendment shall be made which changes
any of the principal terms of the Mergers or this Agreement, without
the approval of such shareholders.
9.4 Waiver of Conditions. The conditions to each of the
parties' obligations to consummate the Mergers are for the sole benefit
of such party and may be waived by such party in whole or in part to the
extent permitted by applicable law.
9.5 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California,
without giving effect to the principles of conflict of laws thereof.
9.6 Interpretation. This Agreement has been negotiated by
the parties and is to be interpreted according to its fair meaning as if
the parties had prepared it together and not strictly for or against any
party. Each of the capitalized terms defined in this Agreement shall,
for all purposes of this Agreement (and whether defined in the plural
and used in the singular, or vice versa), have the respective meaning
assigned to such term in the Section in which such meaning is set forth.
References in this Agreement to "parties" or a "party" refer to parties
to this Agreement unless expressly indicated otherwise. At each place
in this Agreement where the context so requires, the masculine, feminine
or neuter gender includes the others and the singular or plural number
includes the other. "Including" means "including without limitation."
9.7 Headings. The descriptive headings contained in the
Sections and subsections of this Agreement are for convenience of
reference only and shall not affect in any way the meaning or
interpretation of this Agreement.
9.8 Parties in Interest. This Agreement, and the rights,
interests and obligations created by this Agreement, shall bind and
inure to the benefit of the parties and their respective successors and
permitted assigns, and shall confer no right, benefit or interest upon
any other person, including shareholders of the respective parties.
9.9 Notices. All notices or other communications required
or permitted under this Agreement shall be in writing and shall be
delivered personally or sent by U.S. mail, postage prepaid, addressed as
follows or such other address as the party to be notified has furnished
in writing by a notice given in accordance with this Section 9.9:
If to PSI:
Public Storage, Inc.
701 Western Avenue, Suite 200
Glendale, California 91201-2397
Attention: Harvey Lenkin
President
If to PSP14:
Public Storage Properties XIV, Inc.
701 Western Avenue, Suite 200
Glendale, California 91201-2397
Attention: B. Wayne Hughes
Chief Executive Officer
If to PSP15:
Public Storage Properties XV, Inc.
701 Western Avenue, Suite 200
Glendale, California 91201-2397
Attention: B. Wayne Hughes
Chief Executive Officer
Any such notice or communication shall be deemed given as of the date of
delivery, if delivered personally, or on the second day after deposit
with the U.S. Postal Service, if sent by U.S. mail.
9.10 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original, but
all of which shall be considered one and the same agreement.
9.11 Assignment. No rights, interests or obligations of
either party under this Agreement may be assigned or delegated without
the prior written consent of the other party.
9.12 Entire Agreement. This Agreement, including the Merger
Agreement, embodies the entire agreement and understanding between the
parties pertaining to the subject matter hereof, and supersedes all
prior agreements, understandings, negotiations, representations and
discussions, whether written or oral.
9.13 Severable Provisions. If any of the provisions of this
Agreement may be determined to be illegal or otherwise unenforceable,
in whole or in part, the remaining provisions, and any partially
enforceable provisions to the extent enforceable, shall nevertheless
be binding and enforceable.
9.14 Further Action. If at any time after the Effective
Time, the Surviving Corporation shall determine that any assignments,
transfers, deeds or other assurances are necessary or desirable to
vest, perfect or confirm, of record or otherwise, in the Surviving
Corporation, title to any property or rights of PSP14 or PSP15, the
officers of any Constituent Corporation are fully authorized in the name
of PSP14 or PSP15 or otherwise to execute and deliver such documents and
do all things necessary and proper to vest, perfect or confirm title to
such property or rights in the Surviving Corporation.
IN WITNESS WHEREOF, the parties have entered into this Agreement
as of the date first above written.
PUBLIC STORAGE, INC.
By: /s/ HARVEY LENKIN
-------------------------
Harvey Lenkin
President
PUBLIC STORAGE PROPERTIES XIV, INC.
By: /s/ B. WAYNE HUGHES
-------------------------
B. Wayne Hughes
Chief Executive Officer
PUBLIC STORAGE PROPERTIES XV, INC.
By: /s/ B. WAYNE HUGHES
-------------------------
B. Wayne Hughes
Chief Executive Officer
Exhibit A
AGREEMENT OF MERGER
THIS AGREEMENT OF MERGER ("Agreement") is entered into as of this
_____ day of _______________, 1996, by and between PUBLIC STORAGE, INC.,
a California corporation ("PSI"), and [PUBLIC STORAGE PROPERTIES XIV,
INC., a California corporation ("PSP14") and PUBLIC STORAGE PROPERTIES
XV, INC., a California corporation ("PSP15")], with reference to the
following:
A. PSI was incorporated in 1980 under the laws of California,
and on the date hereof its authorized capital stock consists of
200,000,000 shares of Common Stock, $.10 par value (the "PSI Shares"),
___________ of which are issued and outstanding, 7,000,000 shares of
Class B Common Stock, _________ of which are issued and outstanding and
50,000,000 shares of Preferred Stock ($.01 par value), ___________ of
which are issued and outstanding.
B. __________ was incorporated in 1990 under the laws of
California, and on the date hereof has outstanding __________ shares of
Common Stock Series A, $.01 par value (the "_____ Shares"), _________
shares of Common Stock Series B and _________ shares of Common Stock
Series C.
C. PSI, PSP14 and PSP15 have entered into an Agreement and Plan
of Reorganization dated as of December 5, 1996 (the "Plan"), setting
forth certain representations, warranties, conditions and agreements
pertaining to the Merger (as defined below).
D. The Boards of Directors of PSI and __________ have approved
the Plan and this Agreement of Merger, and the requisite shareholder
approval has been obtained.
NOW, THEREFORE, the parties agree as follows:
ARTICLE I
1.1 The Merger. At the Effective Time (as defined below),
__________ will be merged with and into PSI (the "Merger") and PSI
shall be the surviving corporation. PSI and __________ are sometimes
collectively referred to herein as the "Constituent Corporations" and
PSI, as the surviving corporation of the Merger, is sometimes referred
to herein as the "Surviving Corporation."
1.2 Effective Time. The Merger shall become effective at
the time at which this Agreement, together with the requisite Officers'
Certificates of PSI and __________, are filed with the California
Secretary of State (the "Effective Time").
1.3 Effect of the Merger. At the Effective Time:
(a) The separate corporate existence of __________
shall cease and the Surviving Corporation shall thereupon succeed,
without other transfer, to all the rights and property of __________ and
shall be subject to all the debts and liabilities of __________ in the
same manner as if the Surviving Corporation had itself incurred them;
all rights of creditors and all liens upon the property of each of the
Constituent Corporations shall be preserved unimpaired, provided that
such liens upon property of __________ shall be limited to the property
affected thereby immediately prior to the Effective Time; and any action
or proceeding pending by or against __________ may be prosecuted to
judgment, which shall bind the Surviving Corporation, or the Surviving
Corporation may be proceeded against or substituted in its place.
(b) The Articles of Incorporation and the Bylaws of
PSI, as then amended, shall continue to be the Articles of Incorporation
and the Bylaws of the Surviving Corporation until changed as provided by
law and their respective provisions.
(c) The directors of PSI shall continue as
directors of the Surviving Corporation until their successors are
elected and qualified as provided by law and in accordance with the
Articles of Incorporation and Bylaws of the Surviving Corporation.
ARTICLE II
2.1 Conversion of __________ Shares. The manner of
converting the outstanding __________ Shares into cash and/or PSI Shares
shall be as follows:
(a) At the Effective Time, subject to Section 2.6
of the Plan, each __________ Share as to which a cash election has been
made in accordance with the provisions of Section 2.5 of the Plan and
has not been revoked, relinquished or lost pursuant to Section 2.5 of
the Plan (the "Cash Election Shares") shall be converted into and shall
represent the right to receive $_______ in cash (the "Cash Election
Price"). As soon as practicable after the Effective Time, the
registered holders of Cash Election Shares shall be paid the cash to
which they are entitled hereunder in respect of such Cash Election
Shares.
(b) At the Effective Time, subject to Sections 2.4,
2.5 and 2.7 of the Plan, each __________ Share (other than Cash Election
Shares and __________ Shares owned by PSI) shall be converted into
______ PSI Shares.
2.2 No Fractional Shares. Notwithstanding any other term
or provision of this Agreement or the Plan, no fractional PSI Shares
and no certificates or script therefor, or other evidence of ownership
thereof, will be issued in the Merger. In lieu of any such fractional
share interests, each holder of __________ Shares who would otherwise
be entitled to such fractional share will, upon surrender of the
certificate representing such __________ shares, receive a whole PSI
Share if such fractional share to which such holder would otherwise have
been entitled is .5 of an PSI Share or more, and such fractional share
shall be disregarded if it represents less than .5 of an PSI Share;
provided, however, that, such fractional share shall not be disregarded
if such fractional share to which such holder would otherwise have been
entitled represents .5 of 1% or more of the total number of PSI Shares
such holder is entitled to receive in the Merger. In such event, such
holder shall be paid an amount in cash (without interest), rounded to
the nearest $.01, determined by multiplying (i) the per share closing
price on the New York Stock Exchange, Inc. of the PSI Shares at the
Effective Time by (ii) the fractional interest.
2.3 Dissenting Shares. __________ Shares held by a holder
who has demanded and perfected his right to an appraisal of such shares
in accordance with Section 1300 et seq. of the General Corporation Law
of California (the "GCLC") and who has not effectively withdrawn or lost
his right to appraisal ("Dissenting Shares") shall not be converted into
or represent the right to receive cash and/or PSI Shares, but the holder
thereof shall be entitled only to such rights as are granted by Section
1300 et seq. of the GCLC. Each holder of Dissenting Shares who becomes
entitled to payment for __________ Shares pursuant to these provisions
of the GCLC shall receive payment therefor from the Surviving
Corporation in accordance therewith. If any holder of __________ Shares
who demands appraisal in accordance with Section 1300 et seq. of the
GCLC shall effectively withdraw with the consent of the Surviving
Corporation or lose (through failure to perfect or otherwise) his right
to appraisal with respect to __________ Shares, such __________ Shares
shall automatically be converted into the right to receive PSI Shares
pursuant to Section 2.1(b) hereof.
2.4 PSI Shares Unaffected. The Merger shall effect no
change in any of the outstanding PSI Shares and no outstanding PSI
Shares shall be converted or exchanged as a result of the Merger, and
no cash shall be exchangeable and no securities shall be issuable, with
respect thereto.
2.5 Cancellation of Shares Held or Owned by Parties. At
the Effective Time, any __________ Shares owned by PSI shall be
cancelled and retired and no shares shall be issuable, and no cash
shall be exchangeable, with respect thereto.
2.6 Exchange of Certificates. After the Effective Time,
each holder of a certificate theretofore evidencing outstanding
__________ Shares which were converted into PSI Shares pursuant hereto,
upon surrender of such certificate to First National Bank of Boston (the
"Exchange Agent") or such other agent or agents as shall be appointed by
the Surviving Corporation, shall be entitled to receive a certificate
representing the number of whole PSI Shares into which the __________
Shares theretofore represented by the certificate so surrendered shall
have been converted and cash payment in lieu of fractional share
interests, if any. As soon as practicable after the Effective Time, the
Exchange Agent will send a notice and a transmittal form to each holder
of __________ Shares of record at the Effective Time whose stock shall
have been converted into PSI Shares, advising such holder of the
effectiveness of the Merger and the procedure for surrendering to the
Exchange Agent certificates evidencing __________ Shares in exchange
for certificates evidencing PSI Shares.
2.7 Status Until Surrendered. Until surrendered as
provided in Section 2.6 hereof, each outstanding certificate which,
prior to the Effective Time, represented __________ Shares (other than
Cash Election Shares and Dissenting Shares, if any) will be deemed for
all corporate purposes to evidence ownership of the number of whole
PSI Shares into which the __________ Shares evidenced thereby were
converted. However, until such outstanding certificates formerly
evidencing __________ Shares are so surrendered, no dividend payable to
holders of record of PSI Shares shall be paid to the holders of such
outstanding certificates in respect of __________ Shares, but upon
surrender of such certificates by such holders there shall be paid to
such holders the amount of any dividends (without interest) theretofore
paid with respect to such whole PSI Shares as of any record date on or
subsequent to the Effective Time and the amount of any cash (without
interest) payable to such holder in lieu of fractional share interests.
2.8 Transfer of Shares. After the Effective Time, there
shall be no further registration of transfers of __________ Shares on
the records of __________ and, if certificates formerly evidencing
such shares are presented to the Surviving Corporation, they shall be
cancelled and exchanged for certificates evidencing PSI Shares and cash
in lieu of fractional share interests as herein provided.
2.9 Conversion of Common Stock Series B and C. At the
Effective Time, each share of Common Stock Series B (other than shares
owned by PSI) shall be converted into ______ PSI Shares and each share
of Common Stock Series C (other than shares owned by PSI) shall be
converted into ______ PSI Shares.
ARTICLE III
3.1 Headings. The descriptive headings contained in the
Sections of this Agreement are for convenience of reference only and
shall not affect in any way the meaning or interpretation of this
Agreement.
3.2 Parties in Interest. This Agreement, and the rights,
interests and obligations created by this Agreement, shall bind and
inure to the benefit of the parties and their respective successors and
permitted assigns.
3.3 Counterparts. This Agreement may be executed in two or
more counterparts, each of which shall be deemed to be an original, but
all of which shall be considered one and the same agreement.
3.4 Further Action. If at any time after the Effective
Time, the Surviving Corporation shall determine that any assignments,
transfers, deeds or other assurances are necessary or desirable to
vest, perfect or confirm, of record or otherwise, in the Surviving
Corporation, title to any property or rights of __________, the officers
of either Constituent Corporation are fully authorized in the name of
__________ or otherwise to execute and deliver such documents and do all
things necessary and proper to vest, perfect or confirm title to such
property or rights in the Surviving Corporation.
3.5 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of California,
without giving effect to the principles of conflict of laws thereof.
3.6 Abandonment of Merger. The Constituent Corporations
have the power to abandon the Merger by mutual written consent prior to
the filing of this Agreement with the California Secretary of State.
IN WITNESS WHEREOF, the parties have entered into this Agreement
as of the date first above written.
PUBLIC STORAGE, INC.
By: ____________________________
Harvey Lenkin
President
By: ____________________________
Obren B. Gerich
Assistant Secretary
[PUBLIC STORAGE PROPERTIES XIV, INC.
or
PUBLIC STORAGE PROPERTIES XV, INC.]
By: ____________________________
Harvey Lenkin
President
By: ____________________________
Obren B. Gerich
Secretary
