<PAGE>
As filed with the Securities and Exchange Commission on ____________, 1998.
Registration No. ______________
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
________________
FORM S-3
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
________________
WEINGARTEN REALTY INVESTORS
(Exact name of registrant as specified in its charter)
TEXAS 74-1464203
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
2600 CITADEL PLAZA DRIVE
HOUSTON, TEXAS 77008
(713) 866-6000
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
________________
STANFORD ALEXANDER
CHAIRMAN AND CHIEF EXECUTIVE OFFICER
WEINGARTEN REALTY INVESTORS
2600 CITADEL PLAZA DRIVE
HOUSTON, TEXAS 77008
(713) 866-6000
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
________________
Copies to:
BRYAN L. GOOLSBY
LIDDELL, SAPP, ZIVLEY, HILL & LABOON, L.L.P.
2001 ROSS AVENUE, SUITE 3000
DALLAS, TEXAS 75201
________________
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement as determined by
market conditions.
If the only securities being registered on this form are being offered
pursuant to divided or interest reinvestment plans, please check the following
box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
<TABLE>
<CAPTION>
========================================================================================================================
CALCULATION OF REGISTRATION FEE
========================================================================================================================
Title of Each Class of Proposed Maximum
Securities to be Amount to be Proposed Maximum Offering Price Aggregate Offering Amount of
Registered(1) Registered(2) Per Unit(3) Price(2)(3) Registration Fee
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities(4)
Preferred Shares(5) $341,000,000 (8) $341,000,000 $100,595(9)(10)
Common Shares(6)
Securities Warrants(7)
========================================================================================================================
</TABLE>
<PAGE>
(Footnotes from previous page)
(1) This Registration Statement also covers delayed delivery contracts that may
be issued by the Registrant under which the party purchasing such contracts
may be required to purchase Debt Securities, Preferred Shares, Common
Shares or Securities Warrants. Such contracts may be issued together with
the specific Securities to which they relate. In addition, Securities
registered hereunder either may be sold separately or as units comprised of
more than one type of Security registered hereunder.
(2) In U.S. Dollars or the equivalent thereof denominated in one or more
foreign currencies or units of two or more foreign currencies or composite
currencies (such as European Currency Units).
(3) Estimated solely for the purpose of calculating the registration fee. This
Registration Statement is intended to register both the issuance of Common
Shares and Preferred Shares issued for sale directly by the Company, as
well as the issuance of such Common Shares and Preferred Shares upon the
conversion of the Debt Securities or the Preferred Shares, as appropriate,
or upon exercise of Securities Warrants. No separate consideration will be
received for Common Shares or Preferred Shares that are issued upon
conversion of Debt Securities or Preferred Shares registered hereunder as
the case may be. The aggregate maximum offering price of all Securities
issued pursuant to this Registration Statement will not exceed
$341,000,000.
(4) Such indeterminate principal amount of Debt Securities as may from time to
time be issued at indeterminate prices.
(5) Such indeterminate number of Preferred Shares as may be from time to time
be issued at indeterminate prices or issuable upon conversion of Debt
Securities or exercise of Securities Warrants.
(6) Such indeterminate number of Common Shares from time to time be issued at
indeterminate prices or issuable upon conversion of Debt Securities or
Preferred Shares registered hereunder, as the case may be, or exercise of
Securities Warrants.
(7) Such indeterminate number of Debt Securities Warrants, Preferred Shares
Warrants and Common Shares Warrants representing rights to purchase Debt
Securities, Preferred Shares and Common Shares, respectively, registered
pursuant to this Registration Statement, as may from time to time be issued
at indeterminate prices.
(8) Omitted pursuant to General Instruction II.D of Form S-3 under the Sections
Act of 1933, as amended.
(9) Calculated pursuant to Rule 457(o) under the Securities Act of 1933, as
amended.
(10) The amount of the registration fee does not include $20,344.83 which has
previously been paid to the Commission for registration fees relating to
$59,000,000 aggregate principal amount of securities registered pursuant to
Registration Statement No. 333-12179 and unissued as of the date hereof.
-------------------------------------------
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR
DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL
FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF
THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SAID SECTION 8(a),
MAY DETERMINE.
IN ACCORDANCE WITH RULE 429 UNDER THE SECURITIES ACT OF 1933, THE
PROSPECTUS CONTAINED IN THIS REGISTRATION STATEMENT ALSO RELATES TO THE
COMPANY'S REGISTRATION STATEMENT ON FORM S-3 (NO. 333-12179) FILED WITH THE
SECURITIES AND EXCHANGE COMMISSION ON SEPTEMBER 17, 1996. THIS REGISTRATION
STATEMENT, WHICH IS A NEW REGISTRATION STATEMENT, ALSO CONSTITUTES POST-
EFFECTIVE AMENDMENT NO. 1 TO REGISTRATION STATEMENT NO. 333-12179, AND SUCH
POST-EFFECTIVE AMENDMENT SHALL HEREAFTER BECOME EFFECTIVE CONCURRENTLY WITH THE
EFFECTIVENESS OF THIS REGISTRATION STATEMENT IN ACCORDANCE WITH SECTION 8(c) OF
THE SECURITIES ACT OF 1933.
================================================================================
<PAGE>
********************************************************************************
Information contained herein is subject to completion or amendment. A
registration statement relating to these securities has been filed with the
Securities and Exchange Commission. These securities may not be sold nor may
offers to buy be accepted prior to the time the registration statement becomes
effective. This prospectus shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of these securities
in any State in which such offer, solicitation or sale would be unlawful prior
to registration or qualification under the securities laws of any such State.
********************************************************************************
PROSPECTUS
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED MAY 5, 1998
WEINGARTEN REALTY INVESTORS
$400,000,000
DEBT SECURITIES, PREFERRED SHARES,
COMMON SHARES AND SECURITIES WARRANTS
---------------
Weingarten Realty Investors, a real estate investment trust formed under
Texas law (the "Company"), may from time to time offer in one or more series (i)
its unsecured debt securities (the "Debt Securities"), (ii) its preferred shares
of beneficial interest, par value $.03 per share (the "Preferred Shares"), (iii)
its common shares of beneficial interest, par value $.03 per share (the "Common
Shares"), or (iv) warrants to purchase Common Shares (the "Common Shares
Warrants"), warrants to purchase Debt Securities (the "Debt Securities
Warrants") and warrants to purchase Preferred Shares (the "Preferred Shares
Warrants"), with an aggregate public offering price of up to $400,000,000 (or
its equivalent in any other currency or composite currency based on the exchange
rate at the time of sale) in amounts, at prices and on terms to be determined by
market conditions at the time of offering. The Common Shares Warrants, the Debt
Securities Warrants and the Preferred Shares Warrants shall be referred to
herein collectively as the "Securities Warrants." The Debt Securities,
Preferred Shares, Common Shares and Securities Warrants (collectively, the
"Securities") may be offered, separately or together, in separate series in
amounts, at prices and on terms to be set forth in a supplement to this
Prospectus (a "Prospectus Supplement").
The Debt Securities will be direct unsecured obligations of the Company and
may be either senior Debt Securities ("Senior Securities") or subordinated Debt
Securities ("Subordinated Securities"). The Senior Securities will rank equally
with all other unsecured and unsubordinated indebtedness of the Company. The
Subordinated Securities will be subordinated to all existing and future Senior
Debt of the Company, as defined. See "Description of Debt Securities."
The specific terms of the Securities in respect of which this Prospectus is
being delivered will be set forth in the applicable Prospectus Supplement and
will include, where applicable: (i) in the case of Debt Securities, the specific
title, aggregate principal amount, currency, form (which may be registered or
bearer, or certificated or global), authorized denominations, maturity, rate (or
manner of calculation thereof) and time of payment of interest, terms for
redemption at the option of the Company or repayment at the option of the
Holder, terms for sinking fund payments, terms for conversion into Preferred
Shares or Common Shares and any initial public offering price; (ii) in the case
of Preferred Shares, the specific title and stated value, any dividend,
liquidation, redemption, conversion, voting and other rights, and any initial
public offering price; (iii) in the case of Common Shares, any initial public
offering price; and (iv) in the case of Securities Warrants, the duration,
offering price, exercise price and detachability, if applicable. In addition,
such specific terms may include limitations on direct or beneficial ownership
and restrictions on transfer of the Securities, in each case as may be
appropriate to preserve the status of the Company as a real estate investment
trust ("REIT") for federal income tax purposes.
The applicable Prospectus Supplement will also contain information, where
applicable, about certain United States federal income tax considerations
relating to, and any listing on a securities exchange of, the Securities covered
by such Prospectus Supplement.
The Securities may be offered directly by the Company, through agents
designated from time to time by the Company, or to or through underwriters or
dealers. If any agents or underwriters are involved in the sale of any of the
Securities, their names, and any applicable purchase price, fee, commission or
discount arrangement between or among them, will be set forth, or will be
calculable from the information set forth, in the applicable Prospectus
Supplement. See "Plan of Distribution." No Securities may be sold without
delivery of the applicable Prospectus Supplement describing the method and terms
of the offering of such series of Securities.
-----------------
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION
OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS
A CRIMINAL OFFENSE.
-----------------
The date of this Prospectus is May 5, 1998.
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and, in accordance
therewith, files reports and other information with the Securities and Exchange
Commission (the "Commission"). Such reports, proxy statements and other
information can be inspected and copied at the Public Reference Section
maintained by the Commission at Room 1024, 450 Fifth Street, N.W., Washington,
D.C. 20549; Chicago Regional Office, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661; and New York Regional Office, 7 World Trade Center, New
York, New York 10048. The Commission also maintains a Web site at
(http://www.sec.gov) that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. In addition, the Company's Common Shares are listed on the New York
Stock Exchange, Inc. and similar information about the Company can be inspected
and copied at prescribed rates at the offices of the New York Stock Exchange,
Inc., 20 Broad Street, New York, New York 10005.
The Company has filed with the Commission a registration statement on Form
S-3 (the "Registration Statement") under the Securities Act of 1933, as amended
(the "Securities Act"), with respect to the Securities being offered hereby. For
further information with respect to the Company and the Securities offered
hereby, reference is made to the Registration Statement and exhibits thereto.
Statements contained in this Prospectus as to the contents of any contract or
other documents are not necessarily complete, and in each instance, reference is
made to the copy of such contract or documents filed as an exhibit to the
Registration Statement, each such statement being qualified in all respects by
such reference.
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Commission (File No.
1-9876) are incorporated in this Prospectus by reference and are made a part
hereof:
1. The Company's Annual Report on Form 10-K for the year ended
December 31, 1997;
2. The Company's Quarterly Report on Form 10-Q for the quarter ended
March 31, 1998; and
3. The Company's Current Report on Form 8-K filed with the
Commission on April 24, 1998.
Each document filed subsequent to the date of this Prospectus pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act and prior to the
termination of the offering of all Securities to which this Prospectus relates
shall be deemed to be incorporated by reference in this Prospectus and shall be
a part hereof from the date of filing of such document.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement herein, in any
accompanying Prospectus Supplement relating to a specific offering of Securities
or in any other subsequently filed document that is also incorporated or deemed
to be incorporated by reference herein, modifies or supersedes such statement.
Any such statement so modified or superseded shall not be deemed, except as so
modified or superseded, to constitute a part of this Prospectus or any
accompanying Prospectus Supplement. Subject to the foregoing, all information
appearing in this Prospectus and each accompanying Prospectus Supplement is
qualified in its entirety by the information appearing in the documents
incorporated by reference.
UPON WRITTEN OR ORAL REQUEST OF ANY PERSON TO WHOM A PROSPECTUS IS
DELIVERED, THE COMPANY WILL PROVIDE, WITHOUT CHARGE, A COPY OF THE DOCUMENTS
WHICH HAVE BEEN INCORPORATED BY REFERENCE IN THIS PROSPECTUS. REQUESTS FOR SUCH
DOCUMENTS SHOULD BE DIRECTED TO M. CANDACE DUFOUR, VICE PRESIDENT AND SECRETARY,
WEINGARTEN REALTY INVESTORS, 2600 CITADEL PLAZA DRIVE, HOUSTON, TEXAS 77008,
TELEPHONE (713) 866-6000.
THE COMPANY
Weingarten Realty Investors has owned and developed shopping centers and
other commercial real estate since its organization in 1948. The Company's
investment focus has been and continues to be on shopping centers. As of May 5,
1998, Trust Managers and executive officers of the Company controlled 3,771,535
Common Shares or approximately 14% of the outstanding Common Shares.
2
<PAGE>
Initially, the Company grew primarily through development of properties,
with 101 of the 200 operating properties owned at March 31, 1998, having been
developed by the Company. With respect to these projects, the Company acquired
the raw land, constructed buildings and leased the store spaces. The Company
generally develops new projects only when it has leases in place with
financially strong and viable anchor retailers. More recently, the Company has
expanded its property base primarily through acquisitions of properties
previously developed by other parties which satisfy investment criteria similar
to those applicable to new developments. Management believes that the majority
of the Company's growth in the immediate future will continue to result from
acquisitions, due to the continuing over-supply of developed real estate
projects, the current lack of capital for most of the Company's competitors to
finance new investments and the prevailing market discount from reproduction
costs for new projects. As part of its acquisition strategy, the Company seeks
under-managed properties in good locations, the value of which can be enhanced
through remerchandising and renovating. Geographically, the Company considers
expansion in areas where it currently has a presence or where it can acquire
within a reasonable time frame a sufficient number of properties that meet its
investment criteria.
An equally important part of the Company's strategy has been to improve the
cash flow and value of its existing portfolio through: (i) maximizing rental
revenues, occupancy and retail sales, (ii) operating the properties in the most
cost effective manner and (iii) renovating and remerchandising the tenant mix
with respect to selected properties.
Management believes that its overall debt structure is conservative. Based
upon the approximately $1,200,000,000 market value of the Company's equity at
March 31, 1998, the Company's debt represented approximately 29% of its total
market capitalization. The Company's ratio of funds from operations before
interest expense to fixed charges for the quarter ended March 31, 1998 was
approximately 3.6 to 1.0. The Company's ratio of funds from operations before
interest expense to combined fixed charges and preferred share dividends for the
quarter ended March 31, 1998 was 3.5 to 1.0.
The Company conducts its operations in order to qualify as a REIT under the
Internal Revenue Code of 1986, as amended. The Company's principal executive
offices are located at 2600 Citadel Plaza Drive, Houston, Texas 77008, and its
telephone number is (713) 866-6000. As used herein, the term "Company" refers to
Weingarten Realty Investors and its predecessors unless the context otherwise
specifically requires.
USE OF PROCEEDS
Unless otherwise specified in the applicable Prospectus Supplement for any
offering of Securities, the Company intends to use the majority of the net
proceeds from the sale of Securities offered by the Company to repay debt
(including repayments of amounts drawn on lines of credit for property
acquisitions), make improvements to properties, acquire or develop additional
properties and for working capital. Pending use for the foregoing purposes, such
proceeds may be invested in short-term, interest-bearing time or demand deposits
with financial institutions, cash items or qualified government securities.
CERTAIN RATIOS
The following table sets forth the Company's consolidated ratios of
earnings to fixed charges and of funds from operations before interest expense
to fixed charges for the periods shown:
Years Ended December 31,
---------------------------------
1993 1994 1995 1996 1997
----- ----- ----- ----- -----
Ratio of Earnings to Fixed Charges..... 3.94x 4.16x 3.05x 3.17x 2.70x
Ratio of Funds from Operations Before
Interest Expense to Fixed Charges.... 5.76x 6.18x 4.51x 4.32x 3.77x
Until February 1998, the Company had not issued Preferred Shares.
Accordingly, the ratios of earnings to combined fixed charges and preferred
share dividends and funds from operations to combined fixed charges and
preferred share dividends are the same as those presented in the table.
The ratios of earnings to fixed charges were computed by dividing earnings
by fixed charges. The ratios of funds from operations before interest expense
to fixed charges were computed by dividing funds from operations before interest
expense by fixed charges. For these purposes, earnings consist of income before
extraordinary items plus fixed charges (excluding interest costs capitalized).
Funds from operations before interest expense consists of net income plus
depreciation and amortization of real estate assets, interest on indebtedness
and extraordinary charges, less gains and losses on sales of properties and
securities.
3
<PAGE>
Fixed charges consist of interest expense (including interest costs
capitalized), amortization of debt costs and the portion of rent expense
representing an interest factor.
DESCRIPTION OF DEBT SECURITIES
GENERAL
The Senior Securities are to be issued under an indenture (the "Senior
Indenture"), dated as of May 1, 1995, between the Company and Chase Bank of
Texas, National Association (formerly known as Texas Commerce Bank National
Association), as Trustee, and the Subordinated Securities are to be issued under
a separate indenture (the "Subordinated Indenture"), dated as of May 1, 1995,
also between the Company and Chase Bank of Texas, National Association (formerly
known as Texas Commerce Bank National Association), as Trustee. The term
"Trustee" as used herein shall refer to Chase Bank of Texas, National
Association (formerly known as Texas Commerce Bank National Association) or such
other bank as the Company may appoint as trustee pursuant to the terms of the
applicable Indenture, in its or their capacity as Trustee for the Senior
Securities or the Subordinated Securities, as appropriate. The forms of the
Senior Indenture and the Subordinated Indenture (being sometimes referred to
herein collectively as the "Indentures" and individually as an "Indenture") are
filed as exhibits to the Registration Statement. The Indentures are subject to
and governed by the Trust Indenture Act of 1939, as amended (the "TIA"), and may
be amended or supplemented from time to time following execution. The statements
made under this heading relating to the Debt Securities and the Indentures are
summaries of the provisions thereof and do not purport to be complete and are
qualified in their entirety by reference to the Indentures and such Debt
Securities. Parenthetical references below are to the Indentures and capitalized
terms used but not defined herein shall have the respective meanings set forth
in the Indentures.
TERMS
The Debt Securities will be direct, unsecured obligations of the Company.
The indebtedness represented by the Senior Securities will rank equally with all
other unsecured and unsubordinated indebtedness of the Company. The indebtedness
represented by the Subordinated Securities will be subordinated in right of
payment to the prior payment in full of the Senior Debt of the Company as
described under "Subordination."
Each Indenture provides that the Debt Securities may be issued without
limit as to aggregate principal amount, in one or more series, in each case as
established from time to time in, or pursuant to authority granted by, a
resolution of the Board of Trust Managers of the Company or as established in
one or more indentures supplemental to such Indenture. All Debt Securities of
one series need not be issued at the same time and, unless otherwise provided, a
series may be reopened, without the consent of the Holders of the Debt
Securities of such series, for issuances of additional Debt Securities of such
series (Section 301 of each Indenture).
Each Indenture provides that there may be more than one Trustee thereunder,
each with respect to one or more series of Debt Securities. Any Trustee under
either Indenture may resign or be removed with respect to one or more series of
Debt Securities, and a successor Trustee may be appointed to act with respect to
such series (Section 608 of each Indenture). In the event that two or more
persons are acting as Trustee with respect to different series of Debt
Securities, each such Trustee shall be a Trustee of a trust under the applicable
Indenture separate and apart from the trust administered by any other Trustee
(Section 609 of each Indenture), and, except as otherwise indicated herein, any
action described herein to be taken by each Trustee may be taken by each such
Trustee with respect to, and only with respect to, the one or more series of
Debt Securities for which it is Trustee under the applicable Indenture.
Reference is made to the Prospectus Supplement relating to the series of
Debt Securities being offered for the specific terms thereof, including:
(1) the title of such Debt Securities and whether such Debt
Securities are Senior Securities or Subordinated Securities;
(2) the aggregate principal amount of such Debt Securities and any
limit on such aggregate principal amount;
(3) the percentage of the principal amount at which such Debt
Securities will be issued and, if other than the principal amount
thereof, the portion of the principal amount thereof payable upon
declaration of
4
<PAGE>
acceleration of the maturity thereof, or (if applicable) the
portion of the principal amount of such Debt Securities which is
convertible into Common Shares or Preferred Shares, or the method
by which any such portion shall be determined;
(4) if convertible, in connection with the preservation of the
Company's status as a REIT, any applicable limitations on the
ownership or transferability of the Common Shares or Preferred
Shares into which such Debt Securities are convertible;
(5) the date or dates, or the method for determining such date or
dates, on which the principal of such Debt Securities will be
payable;
(6) the rate or rates (which may be fixed or variable), or the method
by which such rate or rates shall be determined, at which such
Debt Securities will bear interest, if any;
(7) the date or dates, or the method for determining such date or
dates, from which any such interest will accrue, the Interest
Payment Dates on which any such interest will be payable, the
Regular Record Dates for such Interest Payment Dates, or the
method by which such dates shall be determined, the Persons to
whom such interest shall be payable, and the basis upon which
interest shall be calculated if other than that of a 360-day year
of twelve 30-day months;
(8) the place or places where the principal of (and premium, if any)
and interest, if any, on such Debt Securities will be payable,
where such Debt Securities may be surrendered for conversion or
registration of transfer or exchange and where notices or demands
to or upon the Company in respect of such Debt Securities and the
applicable Indenture may be served;
(9) the period or periods within which, the price or prices at which
and the other terms and conditions upon which such Debt
Securities may be redeemed, as a whole or in part, at the option
of the Company, if the Company is to have such an option;
(10) the obligation, if any, of the Company to redeem, repay or
purchase such Debt Securities pursuant to any sinking fund or
analogous provision or at the option of a Holder thereof, and the
period or periods within which, the price or prices at which and
the other terms and conditions upon which such Debt Securities
will be redeemed, repaid or purchased, as a whole or in part,
pursuant to such obligation;
(11) if other than U.S. dollars, the currency or currencies in which
such Debt Securities are denominated and payable, which may be a
foreign currency or units of two or more foreign currencies or a
composite currency or currencies, and the terms and conditions
relating thereto;
(12) whether the amount of payments of principal of (and premium, if
any) or interest, if any, on such Debt Securities may be
determined with reference to an index, formula or other method
(which index, formula or method may, but need not be, based on a
currency, currencies, currency unit or units or composite
currency or currencies) and the manner in which such amounts
shall be determined;
(13) any additions to, modifications of or deletions from the terms of
such Debt Securities with respect to the Events of Default or
covenants set forth in the applicable Indenture;
(14) whether such Debt Securities will be issued in certificated or
book-entry form;
(15) whether such Debt Securities will be in registered or bearer
form, and if in registered form, the denominations thereof if
other than $1,000 and any integral multiple thereof and, if in
bearer form, the denominations thereof and terms and conditions
relating thereto;
(16) the applicability, if any, of the defeasance and covenant
defeasance provisions of Article Fourteen of the applicable
Indenture;
5
<PAGE>
(17) if such Debt Securities are to be issued upon the exercise of
Debt Securities Warrants, the time, manner and place for such
Debt Securities to be authenticated and delivered;
(18) the terms, if any, upon which such Debt Securities may be
convertible into Common Shares or Preferred Shares of the Company
and the terms and conditions upon which such conversion will be
effected, including, without limitation, the initial conversion
price or rate and the conversion period;
(19) whether and under what circumstances the Company will pay
Additional Amounts as contemplated in the applicable Indenture on
such Debt Securities in respect of any tax, assessment or
governmental charge and, if so, whether the Company will have the
option to redeem such Debt Securities in lieu of making such
payment; and
(20) any other terms of such Debt Securities not inconsistent with the
provisions of the applicable Indenture (Section 301 of each
Indenture).
The Debt Securities may be issued at a discount below their principal
amount and may provide for less than the entire principal amount thereof to be
payable upon declaration of acceleration of the maturity thereof or bear no
interest or bear interest at a rate which at the time of issuance is below
market rates ("Original Issue Discount Securities") (Section 502 of each
Indenture). Special U.S. federal income tax, accounting and other considerations
applicable to Original Issue Discount Securities will be described in the
applicable Prospectus Supplement.
DENOMINATIONS, INTEREST, REGISTRATION AND TRANSFER
Unless otherwise described in the applicable Prospectus Supplement, the
Debt Securities of any series will be issuable in denominations of $1,000 and
integral multiples thereof (Section 302 of each Indenture).
Unless otherwise specified in the applicable Prospectus Supplement, the
principal of (and applicable premium, if any) and interest, if any, on any
series of Debt Securities will be payable at the corporate trust office of the
Trustee, provided that, at the option of the Company, payment of interest may be
made by check mailed to the address of the Person entitled thereto as it appears
in the Security Register or by wire transfer of funds to such Person at an
account maintained within the United States (Sections 301, 305, 306, 307 and
1002 of each Indenture).
Any interest not punctually paid or duly provided for on any Interest
Payment Date with respect to a Debt Security ("Defaulted Interest") will
forthwith cease to be payable to the Holder on the applicable Regular Record
Date and may either be paid to the person in whose name such Debt Security is
registered at the close of business on a special record date (the "Special
Record Date") for the payment of such Defaulted Interest to be fixed by the
applicable Trustee, notice whereof shall be mailed to each Holder of such Debt
Security not less than 10 days prior to such Special Record Date, or may be paid
at any time in any other lawful manner, all as more completely described in the
applicable Indenture (Section 307 of each Indenture).
Subject to certain limitations imposed upon Debt Securities issued in book-
entry form, the Debt Securities of any series will be exchangeable for other
Debt Securities of the same series and of a like aggregate principal amount and
tenor of different authorized denominations upon surrender of such Debt
Securities at the corporate trust office of the applicable Trustee referred to
above. In addition, subject to certain limitations imposed upon Debt Securities
issued in book-entry form, the Debt Securities of any series may be surrendered
for conversion or registration of transfer or exchange at the corporate trust
office of the applicable Trustee referred to above. Every Debt Security
surrendered for conversion, registration of transfer or exchange shall be duly
endorsed or accompanied by a written instrument of transfer. No service charge
will be made for any registration of transfer or exchange of any Debt
Securities, but the Company may require payment of a sum sufficient to cover any
tax or other governmental charge payable in connection therewith (Section 305 of
each Indenture). If the applicable Prospectus Supplement refers to any transfer
agent (in addition to the applicable Trustee) initially designated by the
Company with respect to any series of Debt Securities, the Company may at any
time rescind the designation of any such transfer agent or approve a change in
the location through which any such transfer agent acts, except that the Company
will be required to maintain a transfer agent in each Place of Payment for such
series. The Company may at any time designate additional transfer agents with
respect to any series of Debt Securities (Section 1002 of each Indenture).
Neither the Company nor any Trustee shall be required to: (i) issue,
register the transfer of or exchange Debt Securities of any series during a
period beginning at the opening of business 15 days before any selection of Debt
Securities of that series
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to be redeemed and ending at the close of business on the day of mailing of the
relevant notice of redemption; (ii) register the transfer of or exchange any
Debt Security, or portion thereof, called for redemption, except the unredeemed
portion of any Debt Security being redeemed in part; or (iii) issue, register
the transfer of or exchange any Debt Security that has been surrendered for
repayment at the option of the Holder, except the portion, if any, of such Debt
Security not to be so repaid (Section 305 of each Indenture).
MERGER, CONSOLIDATION OR SALE
The Company may consolidate with, or sell, lease or convey all or
substantially all of its assets to, or merge with or into, any other corporation
or trust or entity provided that: (i) either the Company shall be the continuing
entity, or the successor entity (if other than the Company) formed by or
resulting from any such consolidation or merger or which shall have received the
transfer of such assets shall expressly assume payment of the principal of (and
premium, if any) and interest, if any, on all of the Debt Securities and the due
and punctual performance and observance of all of the covenants and conditions
contained in each Indenture; (ii) immediately after giving effect to such
transaction and treating any indebtedness that becomes an obligation of the
Company or any Subsidiary as a result thereof as having been incurred by the
Company or such Subsidiary at the time of such transaction, no Event of Default
under the Indenture, and no event which, after notice or the lapse of time, or
both, would become such an Event of Default, shall have occurred and be
continuing; and (iii) an officers' certificate and legal opinion covering such
conditions shall be delivered to each Trustee (Sections 801 and 803 of each
Indenture).
CERTAIN COVENANTS
Limitations on Incurrence of Debt. The Company will not, and will not
permit any Subsidiary to, incur any Debt (as defined below) if, immediately
after giving effect to the incurrence of such Debt and the application of the
proceeds thereof, the aggregate principal amount of all outstanding Debt of the
Company and its Subsidiaries on a consolidated basis determined in accordance
with generally accepted accounting principles is greater than 60% of the sum of
(without duplication) (i) the Company's Total Assets (as defined below) as of
the end of the calendar quarter covered in the Company's Annual Report on Form
10-K or Quarterly Report on Form 10-Q, as the case may be, most recently filed
with the Commission (or, if such filing is not permitted under the Exchange Act,
with the Trustee) prior to the incurrence of such additional Debt and (ii) the
purchase price of any real estate assets or mortgages receivable acquired, and
the amount of any securities offering proceeds received (to the extent such
proceeds were not used to acquire real estate assets or mortgages receivable or
used to reduce Debt), by the Company or any Subsidiary since the end of such
calendar quarter, including those proceeds obtained in connection with the
incurrence of such additional Debt (Section 1004 of each Indenture).
In addition to the foregoing limitation on the incurrence of Debt, the
Company will not, and will not permit any Subsidiary to, incur any Debt secured
by any mortgage, lien, charge, pledge, encumbrance or security interest of any
kind upon any of the property of the Company or any Subsidiary if, immediately
after giving effect to the incurrence of such Debt and the application of the
proceeds thereof, the aggregate principal amount of all outstanding Debt of the
Company and its Subsidiaries on a consolidated basis which is secured by any
mortgage, lien, charge, pledge, encumbrance or security interest on property of
the Company or any Subsidiary is greater than 40% of the Company's Total Assets
(Section 1004 of each Indenture).
In addition to the foregoing limitations on the incurrence of Debt, the
Company will not, and will not permit any Subsidiary to, incur any Debt if the
ratio of Consolidated Income Available for Debt Service (as defined below) to
the Annual Service Charge (as defined below) for the four consecutive fiscal
quarters most recently ended prior to the date on which such additional Debt is
to be incurred shall have been less than 1.5, on a pro forma basis after giving
effect thereto and to the application of the proceeds therefrom, and calculated
on the assumption that: (i) such Debt and any other Debt incurred by the Company
and its Subsidiaries since the first day of such four-quarter period and the
application of the proceeds therefrom, including to refinance other Debt, had
occurred at the beginning of such period; (ii) the repayment or retirement of
any other Debt by the Company and its Subsidiaries since the first day of such
four-quarter period had been incurred, repaid or retired at the beginning of
such period (except that, in making such computation, the amount of Debt under
any revolving credit facility shall be computed based upon the average daily
balance of such Debt during such period); (iii) in the case of Acquired Debt (as
defined below) or Debt incurred in connection with any acquisition since the
first day of such four-quarter period, the related acquisition had occurred as
of the first day of such period with the appropriate adjustments with respect to
such acquisition being included in such pro forma calculation; and (iv) in the
case of any acquisition or disposition by the Company or its Subsidiaries of any
asset or group of assets since the first day of such four-quarter period,
whether by merger, stock purchase or sale, or asset purchase or sale, such
acquisition or disposition or any related repayment of Debt had occurred as of
the first day of such period with the
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appropriate adjustments with respect to such acquisition or disposition being
included in such pro forma calculation (Section 1004 of each Indenture).
Existence. Except as permitted under "Merger, Consolidation or Sale," the
Company will do or cause to be done all things necessary to preserve and keep in
full force and effect its legal existence, rights (charter and statutory) and
franchises; provided, however, that the Company shall not be required to
preserve any right or franchise if it determines that the preservation thereof
is no longer desirable in the conduct of its business (Section 1005 of each
Indenture).
Maintenance of Properties. The Company will cause all of its material
properties used or useful in the conduct of its business or the business of any
Subsidiary to be maintained and kept in good condition, repair and working order
and supplied with all necessary equipment and will cause to be made all
necessary repairs, renewals, replacements, betterments and improvements thereof,
all as in the judgment of the Company may be necessary so that the business
carried on in connection therewith may be properly and advantageously conducted
at all times (Section 1006 of each Indenture).
Insurance. The Company will keep, and will cause each of its Subsidiaries
to keep, all of its insurable properties insured against loss or damage in an
amount at least equal to their then full insurable value with insurers of
recognized responsibility and, if such insurer has publicly rated debt, the
rating for such debt must be at least investment grade with a nationally
recognized rating agency (Section 1007 of each Indenture).
Payment of Taxes and Other Claims. The Company will pay or discharge, or
cause to be paid or discharged, before the same shall become delinquent, (i) all
taxes, assessments and governmental charges levied or imposed upon it or any
Subsidiary or upon the income, profits or property of the Company or any
Subsidiary and (ii) all lawful claims for labor, materials and supplies which,
if unpaid, might by law become a lien upon the property of the Company or any
Subsidiary; provided, however, that the Company shall not be required to pay or
discharge or cause to be paid or discharged any such tax, assessment, charge or
claim whose amount, applicability or validity is being contested in good faith
(Section 1008 of each Indenture).
Provision of Financial Information. Whether or not the Company is subject
to Section 13 or 15(d) of the Exchange Act, the Company will, within 15 days of
each of the respective dates by which the Company would have been required to
file annual reports, quarterly reports and other documents with the Commission
if the Company were so subject, (i) transmit by mail to all Holders of Debt
Securities, as their names and addresses appear in the Security Register,
without cost to such Holders, copies of the annual reports, quarterly reports
and other documents that the Company would have been required to file with the
Commission pursuant to Section 13 or 15(d) of the Exchange Act if the Company
were subject to such Sections, (ii) file with the applicable Trustee copies of
the annual reports, quarterly reports and other documents that the Company would
have been required to file with the Commission pursuant to Section 13 or 15(d)
of the Exchange Act if the Company were subject to such Sections and (iii)
promptly upon written request and payment of the reasonable cost of duplication
and delivery, supply copies of such documents to any prospective Holder (Section
1009 of each Indenture).
Maintenance of Value of Unencumbered Assets to Unsecured Debt. The Company
will at all times maintain an Unencumbered Total Asset Value in an amount of not
less than 100% of the aggregate principal amount of all outstanding Debt of the
Company and its Subsidiaries that is unsecured (Section 1013 of each Indenture).
Limited Covenants in the Event of a Highly Leveraged Transaction. Other
than the covenants of the Company included in the Indentures as described above,
there are no covenants in the Indentures that will afford the holders of Debt
Securities protection in the event of a highly leveraged transaction or similar
transaction involving the Company. Restrictions on ownership and transfers of
the Company's Common Shares and Preferred Shares are designed to preserve its
status as a REIT and, therefore, may act to prevent or hinder a change of
control. See "Description of Preferred Shares" and "Description of Common
Shares." Reference is made to the applicable Prospectus Supplement for
information with respect to any deletions from, modifications of, or additions
to, the Events of Default or covenants of the Company that are described above,
including any addition of a covenant or other event risk provision or similar
protection.
As used herein,
"Acquired Debt" means Debt of a Person (i) existing at the time such Person
becomes a Subsidiary or (ii) assumed in connection with the acquisition of
assets from such Person, in each case, other than Debt incurred in connection
with, or in contemplation of, such Person becoming a Subsidiary or such
acquisition. Acquired Debt shall be deemed to be incurred on the date of the
related acquisition of assets from any Person or the date the acquired Person
becomes a Subsidiary.
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"Annual Service Charge" as of any date means the maximum amount which is
payable in any period for interest on, and original issue discount of, Debt of
the Company and its Subsidiaries and the amount of dividends which are payable
in respect of any Disqualified Stock (as defined below).
"Capital Shares" means, with respect to any Person, any capital shares
(including preferred shares), interests, participations or other ownership
interests (however designated) of such Person and any rights (other than debt
securities convertible into or exchangeable for capital shares), warrants or
options to purchase any thereof.
"Consolidated Income Available for Debt Service" for any period means Funds
from Operations (as defined below) of the Company and its Subsidiaries plus
amounts which have been deducted for interest on Debt of the Company and its
Subsidiaries.
"Debt" of the Company or any Subsidiary means any indebtedness of the
Company, or any Subsidiary, other than contingent liabilities (except to the
extent set forth in (iii) below), in respect of (without duplication) (i)
borrowed money evidenced by bonds, notes, debentures or similar instruments,
(ii) indebtedness secured by any mortgage, pledge, lien, charge, encumbrance or
any security interest existing on property owned by the Company or any
Subsidiary, (iii) the reimbursement obligations, contingent or otherwise, in
connection with any letters of credit actually issued or amounts representing
the balance deferred and unpaid of the purchase price of any property or
services, except any such balance that constitutes an accrued expense or trade
payable, or all conditional sale obligations or obligations under any title
retention agreement, (iv) the principal amount of all obligations of the Company
or any Subsidiary with respect to redemption, repayment or other repurchase of
any Disqualified Stock or (v) any lease of property by the Company or any
Subsidiary as lessee which is reflected on the Company's consolidated balance
sheet as a capitalized lease in accordance with generally accepted accounting
principles to the extent, in the case of items of indebtedness under (i) through
(iii) above, that any such items (other than letters of credit) would appear as
a liability on the Company's consolidated balance sheet in accordance with
generally accepted accounting principles, but does not include any obligation of
the Company or any Subsidiary to be liable for, or to pay, as obligor, guarantor
or otherwise, Debt of another Person (other than the Company or any Subsidiary)
unless and until the Company or such Subsidiary shall become directly liable in
respect thereof.
"Disqualified Stock" means, with respect to any Person, any Capital Shares
of such Person which by the terms of such Capital Shares (or by the terms of any
security into which it is convertible or for which it is exchangeable or
exercisable), upon the happening of any event or otherwise (i) matures or is
mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, (ii)
is convertible into or exchangeable or exercisable for Debt or Disqualified
Stock or (iii) is redeemable at the option of the holder thereof, in whole or in
part, in each case on or prior to the Stated Maturity of the Debt Securities.
"Funds from Operations" for any period means net income plus depreciation
and amortization of real estate assets and extraordinary charges, excluding
gains and losses on sales of properties and securities.
"Total Assets" as of any date means the sum of (i) the Company's
Undepreciated Real Estate Assets and (ii) all other assets of the Company
determined in accordance with generally accepted accounting principles (but
excluding goodwill and unamortized debt costs).
"Undepreciated Real Estate Assets" as of any date means the cost (original
cost plus capital improvements) of real estate assets of the Company and its
Subsidiaries on such date, before depreciation and amortization determined on a
consolidated basis in accordance with generally accepted accounting principles.
"Unencumbered Total Asset Value" as of any date shall mean the sum of the
Company's Total Assets which are unencumbered by any mortgage, lien, charge,
pledge, or security interest.
EVENTS OF DEFAULT, NOTICE AND WAIVER
Each Indenture provides that the following events are "Events of Default"
with respect to any series of Debt Securities issued thereunder: (i) default for
30 days in the payment of any installment of interest on any Debt Security of
such series; (ii) default in the payment of the principal of (or premium, if
any, on) any Debt Security of such series at its Maturity; (iii) default in
making any sinking fund payment as required for any Debt Security of such
series; (iv) default in the performance or breach
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of any other covenant or warranty of the Company contained in the Indenture
(other than a covenant added to the Indenture solely for the benefit of a series
of Debt Securities issued thereunder other than such series), continued for 60
days after written notice as provided in the applicable Indenture; (v) a default
under any bond, debenture, note or other evidence of indebtedness for money
borrowed by the Company (including obligations under leases required to be
capitalized on the balance sheet of the lessee under generally accepted
accounting principles but not including any indebtedness or obligations for
which recourse is limited to property purchased or property mortgaged) in an
aggregate principal amount in excess of $10,000,000 or under any mortgage,
indenture or instrument under which there may be issued or by which there may be
secured or evidenced any indebtedness for money borrowed by the Company
(including such leases but not including such indebtedness or obligations for
which recourse is limited to property purchased) in an aggregate principal
amount in excess of $10,000,000 by the Company, whether such indebtedness now
exists or shall hereafter be created, which default shall have resulted in such
indebtedness becoming or being declared due and payable prior to the date on
which it would otherwise have become due and payable or such obligations being
accelerated, without such acceleration having been rescinded or annulled; (vi)
certain events of bankruptcy, insolvency or reorganization, or court appointment
of a receiver, liquidator or trustee of the Company or any Significant
Subsidiary or either of their properties; and (vii) any other Event of Default
provided with respect to a particular series of Debt Securities (Section 501 of
each Indenture). The term "Significant Subsidiary" means each significant
subsidiary (as defined in Regulation S-X promulgated under the Securities Act)
of the Company.
If an Event of Default under either Indenture with respect to Debt
Securities of any series at the time Outstanding occurs and is continuing, then
in every such case the applicable Trustee or the Holders of not less than 25% in
principal amount of the Outstanding Debt Securities of that series may declare
the principal amount (or, if the Debt Securities of that series are Original
Issue Discount Securities or Indexed Securities, such portion of the principal
amount as may be specified in the terms thereof) of all of the Debt Securities
of that series to be due and payable immediately by written notice thereof to
the Company (and to the applicable Trustee if given by the Holders). However, at
any time after such a declaration of acceleration with respect to Debt
Securities of such series (or of all Debt Securities then Outstanding under
either Indenture, as the case may be) has been made, but before a judgment or
decree for payment of the money due has been obtained by the applicable Trustee,
the Holders of not less than a majority in principal amount of Outstanding Debt
Securities of such series (or of all Debt Securities then Outstanding under the
applicable Indenture, as the case may be) may rescind and annul such declaration
and its consequences if (i) the Company shall have deposited with the applicable
Trustee all required payments of the principal of (and premium, if any) and
interest on the Debt Securities of such series (or of all Debt Securities then
Outstanding under the applicable Indenture, as the case may be), plus certain
fees, expenses, disbursements and advances of the applicable Trustee and (ii)
all Events of Default, other than the non-payment of accelerated principal (or a
specified portion thereof), with respect to Debt Securities of such series (or
of all Debt Securities then Outstanding under the applicable Indenture, as the
case may be) have been cured or waived as provided in each Indenture (Section
502 of each Indenture). Each Indenture also provides that the Holders of not
less than a majority in principal amount of the Outstanding Debt Securities of
any series (or of all Debt Securities then Outstanding under the applicable
Indenture, as the case may be) may waive any past default with respect to such
series and its consequences, except a default (x) in the payment of the
principal of (or premium, if any) or interest, if any, on any Debt Security of
such series or (y) in respect of a covenant or provision contained in the
applicable Indenture that cannot be modified or amended without the consent of
the Holders of each Outstanding Debt Security affected thereby (Section 513 of
each Indenture).
Each Trustee is required to give notice to the Holders of Debt Securities
within 90 days of a default under the applicable Indenture unless such default
shall have been cured or waived; provided, however, that such Trustee may
withhold notice to the Holders of any Series of Debt Securities of any default
with respect to such series (except a default in the payment of the principal of
(or premium, if any) or interest, if any, on any Debt Security of such series or
in the payment of any sinking fund installment in respect of any Debt Security
of such series) if the Responsible Officers of such Trustee consider such
withholding to be in the interest of such Holders (Section 601 of each
Indenture).
Each Indenture provides that no Holders of Debt Securities of any series
may institute any proceedings, judicial or otherwise, with respect to such
Indenture or for any remedy thereunder, except in the case of failure of the
applicable Trustee, for 60 days, to act after it has received a written request
to institute proceedings in respect of an Event of Default from the Holders of
not less than 25% in principal amount of the Outstanding Debt Securities of such
series, as well as an offer of indemnity reasonably satisfactory to it (Section
507 of each Indenture). This provision will not prevent, however, any Holder of
Debt Securities from instituting suit for the enforcement of payment of the
principal of (and premium, if any) and interest, if any, on such Debt Securities
at the respective due dates thereof (Section 508 of each Indenture).
Subject to provisions in each Indenture relating to its duties in case of
default, neither Trustee is under an obligation to exercise any of its rights or
powers under such Indenture at the request or direction of any Holders of any
series of Debt Securities
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then Outstanding under such Indenture, unless such Holders shall have offered to
the Trustee thereunder reasonable security or indemnity (Section 602 of each
Indenture). The Holders of not less than a majority in principal amount of the
Outstanding Debt Securities of any series (or of all Debt Securities then
Outstanding under each Indenture, as the case may be) shall have the right to
direct the time, method and place of conducting any proceeding for any remedy
available to the applicable Trustee, or of exercising any trust or power
conferred upon such Trustee. However, each Trustee may refuse to follow any
direction which is in conflict with any law or the applicable Indenture, which
may involve such Trustee in personal liability or which may be unduly
prejudicial to the Holders of Debt Securities of such series not joining therein
(Section 512 of each Indenture).
Within 120 days after the close of each fiscal year, the Company must
deliver to each Trustee a certificate, signed by one of several specified
officers, stating whether or not such officer has knowledge of any default under
the applicable Indenture and, if so, specifying each such default and the nature
and status thereof (Section 1010 of each Indenture).
MODIFICATION OF THE INDENTURES
Modification and amendment of either Indenture may be made only with the
consent of the Holders of not less than a majority in principal amount of all
Outstanding Debt Securities issued under such Indenture which are affected by
such modification or amendment; provided, however, that no such modification or
amendment may, without the consent of the Holder of each such Debt Security
affected thereby, (i) change the Stated Maturity of the principal of, or any
installment of interest (or premium, if any) on, any such Debt Security, (ii)
reduce the principal amount of, or the rate or amount of interest on, or any
premium payable on redemption of, any such Debt Security, or reduce the amount
of principal of an Original Issue Discount Security that would be due and
payable upon declaration of acceleration of the maturity thereof or would be
provable in bankruptcy, or adversely affect any right of repayment of the Holder
of any such Debt Security, (iii) change the Place of Payment, or the coin or
currency, for payment of principal of, premium, if any, or interest, if any, on
any such Debt Security, (iv) impair the right to institute suit for the
enforcement of any payment on or with respect to any such Debt Security, (v)
reduce the above-stated percentage of Outstanding Debt Securities of any series
necessary to modify or amend the applicable Indenture, to waive compliance with
certain provisions thereof or certain defaults and consequences thereunder or to
reduce the quorum or voting requirements set forth in the applicable Indenture,
or (vi) modify any of the foregoing provisions or any of the provisions relating
to the waiver of certain past defaults or certain covenants, except to increase
the required percentage to effect such action or to provide that certain other
provisions may not be modified or waived without the consent of the Holder of
such Debt Security (Section 902 of each Indenture).
The Holders of not less than a majority in principal amount of Outstanding
Debt Securities issued under either Indenture have the right to waive compliance
by the Company with certain covenants in such Indenture (Section 1012 of each
Indenture).
Modifications and amendments of either Indenture may be made by the Company
and the respective Trustee thereunder without the consent of any Holder of Debt
Securities for any of the following purposes: (i) to evidence the succession of
another Person to the Company as obligor under such Indenture; (ii) to add to
the covenants of the Company for the benefit of the Holders of all or any series
of Debt Securities or to surrender any right or power conferred upon the Company
in such Indenture; (iii) to add Events of Default for the benefit of the Holders
of all or any series of Debt Securities; (iv) to add or change any provisions of
either Indenture to facilitate the issuance of, or to liberalize certain terms
of, Debt Securities in bearer form, or to permit or facilitate the issuance of
Debt Securities in uncertificated form, provided that such action shall not
adversely affect the interests of the Holders of the Debt Securities of any
series in any material respect; (v) to change or eliminate any provisions of
either Indenture, provided that any such change or elimination shall become
effective only when there are no Debt Securities Outstanding of any series
created prior thereto which are entitled to the benefit of such provision; (vi)
to secure the Debt Securities; (vii) to establish the form or terms of Debt
Securities of any series, including the provisions and procedures, if
applicable, for the conversion of such Debt Securities into Common Shares or
Preferred Shares of the Company; (viii) to provide for the acceptance or
appointment of a successor Trustee or facilitate the administration of the
trusts under either Indenture by more than one Trustee; (ix) to cure any
ambiguity, defect or inconsistency in either Indenture, provided that such
action shall not adversely affect the interests of Holders of Debt Securities of
any series issued under such Indenture; or (x) to supplement any of the
provisions of either Indenture to the extent necessary to permit or facilitate
defeasance and discharge of any series of such Debt Securities, provided that
such action shall not adversely affect the interests of the Holders of the Debt
Securities of any series (Section 901 of each Indenture).
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SUBORDINATION
Upon any distribution to creditors of the Company in a liquidation,
dissolution or reorganization, the payment of the principal of and interest on
the Subordinated Securities will be subordinated to the extent provided in the
Subordinated Indenture in right of payment to the prior payment in full of all
Senior Debt (Sections 1601 and 1602 of the Subordinated Indenture), but the
obligation of the Company to make payment of the principal of and interest on
the Subordinated Securities will not otherwise be affected (Section 1608 of the
Subordinated Indenture). No payment of principal or interest may be made on the
Subordinated Securities at any time if a default on Senior Debt exists that
permits the holders of such Senior Debt to accelerate its maturity and the
default is the subject of judicial proceedings or the Company receives notice of
the default (Section 1603 of the Subordinated Indenture). After all Senior Debt
is paid in full and until the Subordinated Securities are paid in full, Holders
will be subrogated to the rights of holders of Senior Debt to the extent that
distributions otherwise payable to Holders have been applied to the payment of
Senior Debt (Section 1607 of the Subordinated Indenture). By reason of such
subordination, in the event of a distribution of assets upon insolvency, certain
general creditors of the Company may recover more, ratably, than holders of the
Subordinated Securities.
Senior Debt is defined in the Subordinated Indenture as the principal of
and interest on, or substantially similar payments to be made by the Company in
respect of, the following, whether outstanding at the date of execution of the
Subordinated Indenture or thereafter incurred, created or assumed: (i)
indebtedness of the Company for money borrowed or represented by purchase-money
obligations, (ii) indebtedness of the Company evidenced by notes, debentures or
bonds, or other securities issued under the provisions of an indenture, fiscal
agency agreement or other instrument, (iii) obligations of the Company as lessee
under leases of property either made as part of any sale and leaseback
transaction to which the Company is a party or otherwise, (iv) indebtedness of
partnerships and joint ventures which is included in the consolidated financial
statements of the Company, (v) indebtedness, obligations and liabilities of
others in respect of which the Company is liable contingently or otherwise to
pay or advance money or property or as guarantor, endorser or otherwise or which
the Company has agreed to purchase or otherwise acquire, and (vi) any binding
commitment of the Company to fund any real estate investment or to fund any
investment in any entity making such real estate investment, in each case other
than (A) any such indebtedness, obligation or liability referred to in clauses
(i) through (vi) above as to which, in the instrument creating or evidencing the
same pursuant to which the same is outstanding, it is provided that such
indebtedness, obligation or liability is not superior in right of payment to the
Subordinated Securities or ranks pari passu with the Subordinated Securities,
(B) any such indebtedness, obligation or liability which is subordinated to
indebtedness of the Company to substantially the same extent as or to a greater
extent than the Subordinated Securities are subordinated, and (C) the
Subordinated Securities (Section 101 of the Subordinated Indenture). At March
31, 1998, Senior Debt aggregated approximately $484 million.
DISCHARGE, DEFEASANCE AND COVENANT DEFEASANCE
Under each Indenture, the Company may discharge certain obligations to
Holders of any series of Debt Securities issued thereunder that have not already
been delivered to the applicable Trustee for cancellation and that either have
become due and payable or will become due and payable within one year (or
scheduled for redemption within one year) by irrevocably depositing with the
applicable Trustee, in trust, funds in such currency or currencies, currency
unit or units or composite currency or currencies in which such Debt Securities
are payable in an amount sufficient to pay the entire indebtedness on such Debt
Securities in respect of principal (and premium, if any) and interest to the
date of such deposit (if such Debt Securities have become due and payable) or to
the Stated Maturity or Redemption Date, as the case may be (Section 401 of each
Indenture).
Each Indenture provides that, if the provisions of Article Fourteen thereof
are made applicable to the Debt Securities of or within any series pursuant to
Section 301 of such Indenture, the Company may elect either (i) to defease and
be discharged from any and all obligations with respect to such Debt Securities
(except for the obligation to pay Additional Amounts, if any, upon the
occurrence of certain events of tax, assessment or governmental charge with
respect to payments on such Debt Securities and the obligations to register the
transfer or exchange of such Debt Securities, to replace temporary or mutilated,
destroyed, lost or stolen Debt Securities, to maintain an office or agency in
respect of such Debt Securities and to hold moneys for payment in trust)
("defeasance") (Section 1402 of each Indenture) or (ii) to be released from its
obligations with respect to such Debt Securities under Sections 1004 to 1009,
inclusive, and Section 1013 of each Indenture (being the restrictions described
under "Certain Covenants") or, if provided pursuant to Section 301 of each
Indenture, its obligations with respect to any other covenant, and any omission
to comply with such obligations shall not constitute a default or an Event of
Default with respect to such Debt Securities ("covenant defeasance") (Section
1403 of each Indenture), in either case upon the irrevocable deposit by the
Company with the applicable Trustee, in trust, of an amount, in such currency or
currencies, currency unit or units or composite currency or currencies in which
such Debt Securities are payable at Stated Maturity, or Government Obligations
(as defined below), or both,
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applicable to such Debt Securities which through the scheduled payment of
principal and interest in accordance with their terms will provide money in an
amount sufficient to pay the principal of (and premium, if any) and interest on
such Debt Securities, and any mandatory sinking fund or analogous payments
thereon, on the scheduled due dates therefor (Section 1404 of each Indenture).
Such a trust may only be established if, among other things, the Company
has delivered to the applicable Trustee an Opinion of Counsel (as specified in
each Indenture) to the effect that the Holders of such Debt Securities will not
recognize income, gain or loss for U.S. federal income tax purposes as a result
of such defeasance or covenant defeasance and will be subject to U.S. federal
income tax on the same amounts, in the same manner and at the same times as
would have been the case if such defeasance or covenant defeasance had not
occurred, and such Opinion of Counsel, in the case of defeasance, must refer to
and be based upon a ruling of the Internal Revenue Service or a change in
applicable U.S. federal income tax law occurring after the date of the Indenture
(Section 1404 of each Indenture).
"Government Obligations" means securities which are (i) direct obligations
of the United States of America or the government which issued the Foreign
Currency in which the Debt Securities of a particular series are payable, for
the payment of which its full faith and credit is pledged or (ii) obligations of
a Person controlled or supervised by and acting as an agency or instrumentality
of the United States of America or such government which issued the Foreign
Currency in which the Debt Securities of such series are payable, the payment of
which is unconditionally guaranteed as a full faith and credit obligation by the
United States of America or such other government, which, in either case, are
not callable or redeemable at the option of the issuer thereof, and shall also
include a depository receipt issued by a bank or trust company as custodian with
respect to any such Government Obligation or a specified payment of interest on
or principal of any such Government Obligation held by such custodian for the
account of the holder of a depository receipt, provided that (except as required
by law) such custodian is not authorized to make any deduction from the amount
payable to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Obligation or the specific payment of
interest on or principal of the Government Obligation evidenced by such
depository receipt (Section 101 of each Indenture).
Unless otherwise provided in the applicable Prospectus Supplement, if after
the Company has deposited funds and/or Government Obligations to effect
defeasance or covenant defeasance with respect to Debt Securities of any series,
(i) the Holder of a Debt Security of such series is entitled to, and does, elect
pursuant to Section 301 of either Indenture or the terms of such Debt Security
to receive payment in a currency, currency unit or composite currency other than
that in which such deposit has been made in respect of such Debt Security, or
(ii) a Conversion Event (as defined below) occurs in respect of the currency,
currency unit or composite currency in which such deposit has been made, the
indebtedness represented by such Debt Security shall be deemed to have been, and
will be, fully discharged and satisfied through the payment of the principal of
(and premium, if any) and interest on such Debt Security as they become due out
of the proceeds yielded by converting the amount so deposited in respect of such
Debt Security into the currency, currency unit or composite currency in which
such Debt Security becomes payable as a result of such election or such
cessation of usage based on the applicable market exchange rate (Section 1405 of
each Indenture). "Conversion Event" means the cessation of use of (i) a
currency, currency unit or composite currency both by the government of the
country which issued such currency and for the settlement of transactions by a
central bank or other public institutions of or within the international banking
community, (ii) the European Currency Unit ("ECU") both within the European
Monetary System and for the settlement of transactions by public institutions of
or within the European Communities or (iii) any currency unit or composite
currency other than the ECU for the purposes of which it was established. Unless
otherwise provided in the applicable Prospectus Supplement, all payments of
principal of (and premium, if any) and interest, if any, on any Debt Security
that is payable in a Foreign Currency that ceases to be used by its government
of issuance shall be made in U.S. dollars (Section 101 of each Indenture).
In the event that the Company effects covenant defeasance with respect to
any Debt Securities and such Debt Securities are declared due and payable
because of the occurrence of any Event of Default other than the Event of
Default described in clause (iv) under "Events of Default, Notice and Waiver"
with respect to Sections 1004 through 1009, inclusive, and Section 1013 of each
Indenture (which Sections would no longer be applicable to such Debt Securities)
or described in clause (vii) under "Events of Default, Notice and Waiver" with
respect to any other covenant as to which there has been covenant defeasance,
the amount in such currency, currency unit or composite currency in which such
Debt Securities are payable, and Government Obligations on deposit with the
applicable Trustee, will be sufficient to pay amounts due on such Debt
Securities at the time of their Stated Maturity but may not be sufficient to pay
amounts due on such Debt Securities at the time of the acceleration resulting
from such Event of Default. However, the Company would remain liable to make
payment of such amounts due at the time of acceleration.
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The applicable Prospectus Supplement may further describe the provisions,
if any, permitting such defeasance or covenant defeasance, including any
modifications to the provisions described above, with respect to the Debt
Securities of or within a particular series.
CONVERSION RIGHTS
The terms and conditions, if any, upon which the Debt Securities are
convertible into Common Shares or Preferred Shares will be set forth in the
applicable Prospectus Supplement relating thereto. Such terms will include
whether such Debt Securities are convertible into Common Shares or Preferred
Shares, the conversion price (or manner of calculation thereof), the conversion
period, provisions as to whether conversion will be at the option of the Holders
or the Company, the events requiring an adjustment of the conversion price and
provisions affecting conversion in the event of the redemption of such Debt
Securities and any restrictions on conversion, including restrictions directed
at maintaining the Company's REIT status.
GLOBAL SECURITIES
The Debt Securities of a series may be issued in whole or in part in the
form of one or more global securities (the "Global Securities") that will be
deposited with, or on behalf of, a depositary (the "Depositary") identified in
the applicable Prospectus Supplement relating to such series. Global Securities
may be issued in either registered or bearer form and in either temporary or
permanent form. The specific terms of the depositary arrangement with respect to
a series of Debt Securities will be described in the applicable Prospectus
Supplement relating to such series. The laws of some jurisdictions require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such laws may impair the ability to transfer beneficial
interests in Debt Securities represented by Global Securities.
DESCRIPTION OF PREFERRED SHARES
GENERAL
The Company is authorized to issue 10,000,000 preferred shares of
beneficial interest, $.03 par value per share (the "Preferred Shares"), of which
3,000,000 shares of 7.44% Series A Cumulative Redeemable Preferred Shares with a
liquidation preference of $25.00 per share were outstanding at March 31, 1998.
The following description of the Preferred Shares sets forth certain
general terms and provisions of the Preferred Shares to which any Prospectus
Supplement may relate. The statements below describing the Preferred Shares are
in all respects subject to and qualified in their entirety by reference to the
applicable provisions of the Company's Restated Declaration of Trust, as amended
(the "Declaration of Trust") and Bylaws and applicable statement of designations
(the "Statement of Designations").
TERMS
Subject to the limitations prescribed by the Declaration of Trust, the
Board of Trust Managers is authorized to fix the number of shares constituting
each series of Preferred Shares and the designations, preferences, conversion,
exchange or other rights, participations, voting powers, options, restrictions,
limitations, special rights or relations, limitations as to dividends,
qualifications, terms and conditions of redemption and such other subjects or
matters as may be fixed by resolution of the Board of Trust Managers. The
Preferred Shares will, when issued, be fully paid and nonassessable by the
Company (except as described under "Shareholder Liability" below) and will have
no preemptive rights.
Reference is made to the Prospectus Supplement relating to the Preferred
Shares offered thereby for specific terms, including:
1. The title and stated value of such Preferred Shares;
2. The number of such Preferred Shares offered, the liquidation
preference per share and the offering price of such Preferred Shares;
3. The dividend rate(s), period(s) and/or payment date(s) or method(s) of
calculation thereof applicable to such Preferred Shares;
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4. The date from which dividends on such Preferred Shares shall
accumulate, if applicable;
5. The procedures for any auction and remarketing, if any, for such
Preferred Shares;
6. The provision for a sinking fund, if any, for such Preferred Shares;
7. The provision for redemption, if applicable, of such Preferred Shares;
8. Any listing of such Preferred Shares on any securities exchange;
9. The terms and conditions, if applicable, upon which such Preferred
Shares will be convertible into Common Shares of the Company,
including the conversion price (or manner of calculation thereof);
10. Any other specific terms, preferences, rights, limitations or
restrictions of such Preferred Shares;
11. A discussion of federal income tax considerations applicable to such
Preferred Shares;
12. The relative ranking and preferences of such Preferred Shares as to
dividend rights and rights upon liquidation, dissolution or winding up
of the affairs of the Company;
13. Any limitations on issuance of any series of Preferred Shares ranking
senior to or on a parity with such series of Preferred Shares as to
dividend rights and rights upon liquidation, dissolution or winding up
of the affairs of the Company; and
14. Any limitations on direct or beneficial ownership and restriction on
transfer, in each case as may be appropriate to preserve the status of
the Company as a REIT.
RANK
Unless otherwise specified in the Prospectus Supplement, the Preferred
Shares will, with respect to dividend rights and rights upon liquidation,
dissolution or winding up of the Company, rank (i) senior to all classes or
series of Common Shares or other Capital Shares of the Company, and to all
equity securities ranking junior to such Preferred Shares, (ii) on a parity with
all equity securities issued by the Company, the terms of which specifically
provide that such equity securities rank on a parity with the Preferred Shares,
and (iii) junior to all equity securities issued by the Company, the terms of
which specifically provide that such equity securities rank senior to the
Preferred Shares. The term "equity securities" does not include convertible debt
securities.
DIVIDENDS
Holders of the Preferred Shares of each series will be entitled to receive,
when, as and if declared by the Board of Trust Managers of the Company, out of
assets of the Company legally available for payment, cash dividends at such
rates and on such dates as will be set forth in the applicable Prospectus
Supplement. Each such dividend shall be payable to Holders of record as they
appear on the share transfer books of the Company on such record dates as shall
be fixed by the Board of Trust Managers of the Company.
Dividends on any series of the Preferred Shares may be cumulative or
noncumulative, as provided in the applicable Prospectus Supplement. Dividends,
if cumulative, will be cumulative from and after the date set forth in the
applicable Prospectus Supplement. If the Board of Trust Managers of the Company
fails to declare a dividend payable on a dividend payment date on any series of
the Preferred Shares for which dividends are noncumulative, then the holders of
such series of the Preferred Shares will have no right to receive a dividend in
respect of the dividend period ending on such dividend payment date, and the
Company will have no obligation to pay the dividend accrued for such period,
whether or not dividends on such series are declared payable on any future
dividend payment date.
If Preferred Shares of any series are outstanding, no dividends will be
declared or paid or set apart for payment on the Preferred Shares of the Company
of any other series ranking, as to dividends, on a parity with or junior to the
Preferred Shares of such series for any period unless (i) if such series of
Preferred Shares has a cumulative dividend, full cumulative dividends have been
or contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for such payment on the Preferred Shares of such
series for all past dividend periods and the then current dividend period or
(ii) if such series of Preferred Shares does not have a cumulative dividend,
full dividends for the then current dividend period have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for such
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payment on the Preferred Shares of such series. When dividends are not paid in
full (or a sum sufficient for such full payment is not so set apart) upon
Preferred Shares of any series and the shares of any other series of Preferred
Shares ranking on a parity as to dividends with the Preferred Shares of such
series, all dividends declared upon Preferred Shares of such series and any
other series of Preferred Shares ranking on a parity as to dividends with such
Preferred Shares shall be declared pro rata so that the amount of dividends
declared per Preferred Share of such series and such other series of Preferred
Shares shall in all cases bear to each other the same ratio that accrued
dividends per share on the Preferred Shares of such series (which shall not
include any accumulation in respect of unpaid dividends for prior dividend
periods if such Preferred Shares do not have a cumulative dividend) and such
other series of Preferred Shares bear to each other. No interest, or sum of
money in lieu of interest, shall be payable in respect of any dividend payment
or payments on Preferred Shares of such series which may be in arrears.
Except as provided in the immediately preceding paragraph, unless (i) if
such series of Preferred Shares has a cumulative dividend, full cumulative
dividends on the Preferred Shares of such series have been or contemporaneously
are declared and paid or declared and a sum sufficient for the payment thereof
set apart for payment for all past dividend periods and the then current
dividend period and (ii) if such series of Preferred Shares does not have a
cumulative dividend, full dividends on the Preferred Shares of such series have
been or contemporaneously are declared and paid or declared and a sum sufficient
for the payment thereof set apart for payment for the then current dividend
period, no dividends (other than in Common Shares or other Capital Shares
ranking junior to the Preferred Shares of such series as to dividends and upon
liquidation) shall be declared or paid or set aside for payment or other
distribution shall be declared or made upon the Common Shares, or any other
Capital Shares of the Company ranking junior to or on a parity with the
Preferred Shares of such series as to dividends or upon liquidation, nor shall
any Common Shares, or any other Capital Shares of the Company ranking junior to
or on a parity with the Preferred Shares of such series as to dividends or upon
liquidation be redeemed, purchased or otherwise acquired for any consideration
(or any moneys be paid to or made available for a sinking fund for the
redemption of any such shares) by the Company (except by conversion into or
exchange for such Capital Shares of the Company ranking junior to the Preferred
Shares of such series as to dividends and upon liquidation).
Any dividend payment made on shares of a series of Preferred Shares shall
first be credited against the earliest accrued but unpaid dividend due with
respect to shares of such series which remains payable.
REDEMPTION
If so provided in the applicable Prospectus Supplement, the Preferred
Shares will be subject to mandatory redemption or redemption at the option of
the Company, as a whole or in part, in each case upon the terms, at the times
and at the redemption prices set forth in such Prospectus Supplement.
The Prospectus Supplement relating to a series of Preferred Shares that is
subject to mandatory redemption will specify the number of such Preferred Shares
that shall be redeemed by the Company in each year commencing after a date to be
specified, at a redemption price per share to be specified, together with an
amount equal to all accrued and unpaid dividends thereon (which shall not, if
such Preferred Shares do not have a cumulative dividend, include any
accumulation in respect of unpaid dividends for prior dividend periods) to the
date of redemption. The redemption price may be payable in cash or other
property, as specified in the applicable Prospectus Supplement.
Notwithstanding the foregoing, unless (i) if such series of Preferred
Shares has a cumulative dividend, full cumulative dividends on all shares of any
series of Preferred Shares shall have been or contemporaneously are declared and
paid or declared and a sum sufficient for the payment thereof set apart for
payment for all past dividend periods and the then current dividend period and
(ii) if such series of Preferred Shares does not have a cumulative dividend,
full dividends on the Preferred Shares of any series have been or
contemporaneously are declared and paid or declared and a sum sufficient for the
payment thereof set apart for payment for the then current dividend period, no
shares of any series of Preferred Shares shall be redeemed unless all
outstanding Preferred Shares of such series are simultaneously redeemed;
provided, however, that the foregoing shall not prevent the purchase or
acquisition of Preferred Shares of such series to preserve the REIT status of
the Company or pursuant to a purchase or exchange offer made on the same terms
to holders of all outstanding Preferred Shares of such series, and, unless (i)
if such series of Preferred Shares has a cumulative dividend, full cumulative
dividends on all outstanding shares of any series of Preferred Shares have been
or contemporaneously are declared and paid or declared and a sum sufficient for
the payment thereof set apart for payment for all past dividend periods and the
then current dividend period and (ii) if such series of Preferred Shares
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does not have a cumulative dividend, full dividends on the Preferred Shares of
any series have been or contemporaneously are declared and paid or declared and
a sum sufficient for the payment thereof set apart for payment for the then
current dividend period, the Company shall not purchase or otherwise acquire
directly or indirectly any Preferred Shares of such series (except by conversion
into or exchange for Capital Shares of the Company ranking junior to the
Preferred Shares of such series as to dividends and upon liquidation); provided,
however, that the foregoing shall not prevent the purchase or acquisition of
Preferred Shares of such series to preserve the REIT status of the Company or
pursuant to a purchase or exchange offer made on the same terms to holders of
all outstanding Preferred Shares of such series.
If fewer than all of the outstanding Preferred Shares of any series are to
be redeemed, the number of Preferred Shares to be redeemed will be determined by
the Company and such shares may be redeemed pro rata from the holders of record
of such shares in proportion to the number of such shares held by such holders
(with adjustments to avoid redemption of fractional shares) or by lot in a
manner determined by the Company.
Notice of redemption will be mailed at least 30 days but not more than 60
days before the redemption date to each holder of record of Preferred Shares of
any series to be redeemed at the address shown on the share transfer books of
the Company. Each notice shall state: (i) the redemption date; (ii) the number
of shares and series of the Preferred Shares to be redeemed; (iii) the
redemption price; (iv) the place or places where certificates for such Preferred
Shares are to be surrendered for payment of the redemption price; (v) that
dividends on the shares to be redeemed will cease to accrue on such redemption
date; and (vi) the date upon which the holder's conversion rights, if any, as to
such shares will terminate. If fewer than all of the Preferred Shares of any
series are to be redeemed, the notice mailed to each such holder thereof shall
also specify the number of Preferred Shares to be redeemed from each such
holder. If notice of redemption of any Preferred Shares has been given and if
the funds necessary for such redemption have been set aside by the Company in
trust for the benefit of the holders of any Preferred Shares so called for
redemption, then from and after the redemption date dividends will cease to
accrue on such Preferred Shares, and all rights of the holders of such shares
will terminate, except the right to receive the redemption price.
LIQUIDATION PREFERENCE
Upon any voluntary or involuntary liquidation, dissolution or winding up of
the affairs of the Company, then, before any distribution or payment shall be
made to the holders of any Common Shares, excess shares or any other class or
series of Capital Shares of the Company ranking junior to the Preferred Shares
in the distribution of assets upon any liquidation, dissolution or winding up of
the Company, the holders of each series of Preferred Shares shall be entitled to
receive out of assets of the Company legally available for distribution to
shareholders liquidating distributions in the amount of the liquidation
preference per share (set forth in the applicable Prospectus Supplement), plus
an amount equal to all dividends accrued and unpaid thereon (which shall not
include any accumulation in respect of unpaid dividends for prior dividend
periods if such Preferred Shares do not have a cumulative dividend). After
payment of the full amount of the liquidating distributions to which they are
entitled, the holders of Preferred Shares will have no right or claim to any of
the remaining assets of the Company. In the event that, upon any such voluntary
or involuntary liquidation, dissolution or winding up, the available assets of
the Company are insufficient to pay the amount of the liquidating distributions
on all outstanding Preferred Shares and the corresponding amounts payable on all
shares of other classes or series of Capital Shares of the Company ranking on a
parity with the Preferred Shares in the distribution of assets, then the holders
of the Preferred Shares and all other such classes or series of Capital Shares
shall share ratably in any such distribution of assets in proportion to the full
liquidating distributions to which they would otherwise be respectively
entitled.
If liquidating distributions shall have been made in full to all holders of
Preferred Shares, the remaining assets of the Company shall be distributed among
the holders of any other classes or series of Capital Shares ranking junior to
the Preferred Shares upon liquidation, dissolution or winding up, according to
their respective rights and preferences and in each case according to their
respective number of shares. For such purposes, the consolidation or merger of
the Company with or into any other corporation, trust or entity, or the sale,
lease or conveyance of all or substantially all of the property or business of
the Company, shall not be deemed to constitute a liquidation, dissolution or
winding up of the Company.
VOTING RIGHTS
Holders of the Preferred Shares will not have any voting rights, except as
set forth below or as otherwise from time to time required by law or as
indicated in the applicable Prospectus Supplement.
Whenever dividends on any Preferred Shares shall be in arrears for six
consecutive quarterly periods, the holders of such Preferred Shares (voting
separately as a class with all other series of Preferred Shares upon which like
voting rights have been
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conferred and are exercisable) will be entitled to vote for the election of two
additional Trust Managers of the Company at the next annual meeting of
shareholders and at each subsequent meeting until (i) if such series of
Preferred Shares has a cumulative dividend, all dividends accumulated on such
series of Preferred Shares for the past dividend periods and the then current
dividend period shall have been fully paid or declared and a sum sufficient for
the payment thereof set aside for payment or (ii) if such series of Preferred
Shares does not have a cumulative dividend, four consecutive quarterly dividends
shall have been fully paid or declared and a sum sufficient for the payment
thereof set aside for payment. In such case, the entire Board of Trust Managers
of the Company will be increased by two Trust Managers.
Unless provided otherwise for any series of Preferred Shares, so long as
any Preferred Shares remain outstanding, the Company will not, without the
affirmative vote or consent of the holders of two-thirds of the shares of each
series of Preferred Shares outstanding at the time, given in person or by proxy,
either in writing or at a meeting (such series voting separately as a class),
(i) authorize or create, or increase the authorized or issued amount of, any
class or series of Capital Shares ranking prior to such series of Preferred
Shares with respect to the payment of dividends or the distribution of assets
upon liquidation, dissolution or winding up or reclassify any authorized Capital
Shares of the Company into any such shares, or create, authorize or issue any
obligation or security convertible into or evidencing the right to purchase any
such shares, or (ii) amend, alter or repeal the provisions of the Company's
Declaration of Trust or the Statement of Designations for such series of
Preferred Shares, whether by merger, consolidation or otherwise (an "Event"), so
as to materially and adversely affect any right, preference, privilege or voting
power of such series of Preferred Shares or the holders thereof; provided,
however, with respect to the occurrence of any of the Events set forth in (ii)
above, so long as the Preferred Shares remain outstanding with the terms thereof
materially unchanged, taking into account that upon the occurrence of an Event,
the Company may not be the surviving entity, the occurrence of any such Event
shall not be deemed to materially and adversely affect such rights, preferences,
privileges or voting power of holders of Preferred Shares and provided further
that (A) any increase in the amount of the authorized Preferred Shares or the
creation or issuance of any other series of Preferred Shares, or (B) any
increase in the number of authorized shares of such series or any other series
of Preferred Shares, in each case ranking on a parity with or junior to the
Preferred Shares of such series with respect to the payment of dividends or the
distribution of assets upon liquidation, dissolution or winding up, shall not be
deemed to materially and adversely affect such rights, preferences, privileges
or voting powers.
The foregoing voting provisions will not apply if, at or prior to the time
when the act with respect to which such vote would otherwise be required shall
be effected, all outstanding shares of such series of Preferred Shares shall
have been redeemed or called for redemption and sufficient funds shall have been
deposited in trust to effect such redemption.
CONVERSION RIGHTS
The terms and conditions, if any, upon which any series of Preferred Shares
are convertible into Common Shares will be set forth in the applicable
Prospectus Supplement relating thereto. Such terms will include the number of
Common Shares into which the Preferred Shares are convertible, the conversion
price (or manner of calculation thereof), the conversion period, provisions as
to whether conversion will be at the option of the holders of the Preferred
Shares or the Company, the events requiring an adjustment of the conversion
price and provisions affecting conversion in the event of the redemption of such
Preferred Shares.
SHAREHOLDER LIABILITY
As discussed below under "Description of Common Shares - Shareholder
Liability," the Declaration of Trust provides that no shareholder, including
holders of Preferred Shares, shall be personally liable for the acts and
obligations of the Company and that the funds and property of the Company shall
be solely liable for such acts or obligations. The Declaration of Trust provides
that, to the extent practicable, each written instrument creating an obligation
of the Company shall contain a provision to that effect. By statute, the State
of Texas provides limited liability for shareholders of a REIT organized under
the Texas Real Estate Investment Trust Act (the "REIT Act"). However, certain
jurisdictions may not recognize the limited liability provided shareholders
under the REIT Act and, therefore, a shareholder may be held personally liable
to the extent that such claims are not satisfied by the Company. Because of the
uncertainty that may exist in the laws of certain states in which the Company
owns property or conducts business, wholly owned subsidiary corporations are
utilized to own properties in such states. The Bylaws of the Company provide for
indemnification of shareholders by the Company for any liabilities incurred in
such capacity. The Company carries public liability insurance that the Trust
Managers consider adequate. Thus, any risk of personal liability to shareholders
is limited to situations in which the Company's assets plus its insurance
coverage would be insufficient to satisfy the claims against the Company and its
shareholders. The Company believes that its operations have been conducted and
will continue to be conducted in such a way so as to avoid, as far as possible,
ultimate liability of the shareholders for liabilities of the Company.
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RESTRICTIONS ON OWNERSHIP
As discussed below under "Description of Common Shares - REIT
Qualification," for the Company to qualify as a REIT under the Internal Revenue
Code of 1986, as amended (the "Code"), not more than 50% in value of its
outstanding Capital Shares may be owned, directly or constructively, by five or
fewer individuals (as defined in the Code to include certain entities) during
the last half of a taxable year. To assist the Company in meeting this
requirement, the Company may take certain other actions to limit the beneficial
ownership, directly or indirectly, by a single person to not more than 9.8% of
the Company's outstanding equity securities, including any Preferred Shares of
the Company. Therefore, the Statement of Designations for each series of
Preferred Shares will contain certain provisions restricting the ownership and
transfer of the Preferred Shares. The applicable Prospectus Supplement will
specify any additional ownership limitation relating to a series of Preferred
Shares.
DESCRIPTION OF COMMON SHARES
GENERAL
The Common Shares are issued pursuant to the Declaration of Trust. The
Common Shares, par value $.03 per share, are equal with respect to distribution
and liquidation rights, are not convertible, have no preemptive rights to
subscribe for additional Common Shares, are nonassessable (except as described
under "Shareholder Liability" below) and are transferable in the same manner as
shares of a corporation. Each shareholder is entitled to one vote in person or
by proxy for each Common Share registered in his name and has the right to vote
on the election or removal of Trust Managers, amendments to the Declaration of
Trust, proposals to terminate, reorganize, merge or consolidate the Company or
to sell or dispose of substantially all of the Company's property and with
respect to certain business combinations. The Company will have perpetual
existence unless and until dissolved and terminated. Except with respect to the
foregoing matters, no action taken by the shareholders at any meeting shall in
any way bind the Trust Managers. The Common Shares offered by the Company will
be, when issued, fully paid and nonassessable (except as described under
"Shareholder Liability" below).
Several provisions in the Declaration of Trust may have the effect of
deterring a take-over of the Company. These provisions restrict ownership of the
Company's outstanding equity securities by a single person to not more than 9.8%
of such securities to assist in protecting and preserving the qualification of
the Company as a REIT under the Code and include a "fair price" provision that
would deter a "two-stage" take-over transaction by requiring an 80% vote of
outstanding securities entitled to vote thereon for certain defined "business
combinations" with shareholders owning more than 50% of the equity securities
considered for such purposes if the transaction is neither approved by the Board
of Trust Managers nor meets certain price and procedural conditions.
REIT QUALIFICATION
The Company operates in a manner intended to qualify it for treatment as a
REIT under Sections 856 through 860 of the Code. In general, a REIT that
distributes to its shareholders at least 95% of its taxable income (other than
net capital gain) for a taxable year and that meets certain other conditions
will not be taxed on income (including net capital gain) distributed for that
year. If the Company fails to qualify as a REIT in any taxable year, it will be
taxed as a corporation for that year, and distributions to its shareholders will
not be deductible by the Company in computing its taxable income. In such case,
the Company will likely be disqualified from being treated as a REIT for the
ensuing four taxable years. Failure to qualify as a REIT could result in the
Company incurring indebtedness and perhaps liquidating investments in order to
pay its taxes, and could have a material adverse effect upon the market price of
the Company's outstanding securities.
Among the requirements which must be met in order for the Company to
qualify as a REIT is that no more than 50% in value of the outstanding capital
shares, including in some circumstances capital shares into which outstanding
securities (including the Securities) might be converted, may be owned actually
or constructively by five or fewer individuals or certain other entities at any
time during the last half of the Company's taxable year. To assist the Company
in meeting this requirement, the Declaration of Trust limits persons to
ownership of not more than 9.8% of the outstanding equity securities of the
Company, including Common Shares. For purposes of such ownership limit,
convertible securities (whether in registered or bearer form) are treated as if
such securities had been converted in calculating the ownership limit. The
Declaration of Trust provides that any attempted transfer of Common Shares or
Preferred Shares that would cause a person to exceed the limit shall be null and
void. However, because the Code imposes broad attribution rules in determining
constructive ownership, no assurance can be given that the restrictions of the
Declaration of Trust will be effective in maintaining the Company's REIT status.
Further, owners of more than 6.5% of the Common Shares as of January 19, 1988
(currently only Stanford Alexander, who at March 31, 1998 beneficially
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<PAGE>
owned approximately 8.1% of the outstanding Common Shares) are exempted from the
limit. Without shareholder approval, the Company may issue an unlimited number
of securities, warrants, rights or other options to purchase Common Shares and
other securities convertible into Common Shares.
SHAREHOLDER LIABILITY
The Declaration of Trust provides that no shareholder shall be personally
liable for the acts and obligations of the Company and that the funds and
property of the Company shall be solely liable for such acts or obligations. The
Declaration of Trust provides that, to the extent practicable, each written
instrument creating an obligation of the Company shall contain a provision to
that effect. By statute, the State of Texas provides limited liability for
shareholders of a REIT organized under the REIT Act. However, certain
jurisdictions may not recognize the limited liability provided shareholders
under the REIT Act and, therefore, a shareholder may be held personally liable
to the extent that such claims are not satisfied by the Company. Because of the
uncertainty that may exist in the laws of certain states in which the Company
owns property or conducts business, wholly-owned subsidiary corporations are
utilized to own properties in such states. The Bylaws of the Company provide for
indemnification of shareholders by the Company for any liabilities incurred in
such capacity. The Company carries public liability insurance that the Trust
Managers consider adequate. Thus, any risk of personal liability to shareholders
is limited to situations in which the Company's assets plus its insurance
coverage would be insufficient to satisfy the claims against the Company and its
shareholders. The Company believes that its operations have been conducted and
will continue to be conducted in such a way so as to avoid, as far as possible,
ultimate liability of the shareholders for liabilities of the Company.
REGISTRAR AND TRANSFER AGENT
The Registrar and Transfer Agent for the Common Shares is Society National
Bank, Cleveland, Ohio. The Common Shares are listed on the New York Stock
Exchange (Symbol: WRI).
DESCRIPTION OF SECURITIES WARRANTS
The Company may issue Securities Warrants (which may include subscription
rights distributed to the Company's shareholders) for the purchase of Debt
Securities, Preferred Shares or Common Shares. Securities Warrants may be
issued independently or together with any other Securities offered by any
Prospectus Supplement and may be attached to or separate from such Securities.
Each series of Securities Warrants will be issued under a separate warrant
agreement (each, a "Warrant Agreement") to be entered into between the Company
and a warrant agent specified in the applicable Prospectus Supplement (the
"Warrant Agent"). The Warrant Agent will act solely as an agent of the Company
in connection with the Securities Warrants of such series and will not assure
any obligation or relationship of agency or trust for or with any holders or
beneficial owners of Securities Warrants. The following summaries of certain
provisions of the Warrant Agreement and the Securities Warrants do not purport
to be complete and are subject to, and are qualified in their entirety by
reference to, all the provisions of the Warrant Agreement and the Securities
Warrant certificates relating to each series of Securities Warrants which will
be filed with the Commission and incorporated by reference as an exhibit to the
Registration Statement of which this Prospectus is a part at or prior to the
time of the issuance of such series of Securities Warrants.
If Securities Warrants are offered, the applicable Prospectus Supplement
will describe the terms of such Securities Warrants, including, in the case of
Securities Warrants for the purchase of Debt Securities, the following where
applicable: (i) the offering price; (ii) the denominations and terms of the
series of Debt Securities purchasable upon exercise of such Securities Warrants;
(iii) the designation and terms of any series of Debt Securities with which such
Securities Warrants are being offered and the number of such Securities Warrants
being offered with such Debt Securities; (iv) the date, if any, on and after
which such Securities Warrants and the related series of Debt Securities will be
transferable separately; (v) the principal amount of the series of Debt
Securities purchasable upon exercise of each such Securities Warrant and the
price at which such principal amount of Debt Securities of such series may be
purchased upon such exercise; (vi) the date on which the right to exercise such
Securities Warrants shall commence and the date on which such right shall expire
(the "Expiration Date"); (vii) whether the Securities Warrants will be issued in
registered or bearer form; (viii) any special United States federal income tax
consequences; (ix) the terms, if any, on which the Company may accelerate the
date by which the Securities Warrants must be exercised; and (x) any other
material terms of such Securities Warrants.
In the case of Securities Warrants for the purchase of Preferred Shares or
Common Shares, the applicable Prospectus Supplement will describe the terms of
such Securities Warrants, including the following where applicable: (i) the
offering price; (ii) the aggregate number of shares purchasable upon exercise of
such Securities Warrants, the exercise price, and in the case of
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Securities Warrants for Preferred Shares, the designation, aggregate number and
terms of the series of Preferred Shares purchasable upon exercise of such
Securities Warrants; (iii) the designation and terms of any series of Preferred
Shares with which such Securities Warrants are being offered and the number of
such Securities Warrants being offered with such Preferred Shares; (iv) the
date, if any, on and after which such Securities Warrants and the related series
of Preferred Shares or Common Shares will be transferable separately; (vi) any
special United States federal income tax consequences; and (vii) any other
material terms of such Securities Warrants.
Securities Warrant certificates may be exchanged for new Securities Warrant
certificates of different denominations, may (if in registered form) be
presented for registration of transfer, and may be exercised at the corporate
trust office of the Warrant Agent or any other office indicated in the
applicable Prospectus Supplement. Prior to the exercise of any Securities
Warrant to purchase Debt Securities, holders of such Securities Warrants will
not have any of the rights of holders of the Debt Securities purchasable upon
such exercise, including the right to receive payments of principal, premium, if
any, or interest, if any, on such Debt Securities or to enforce covenants in the
applicable indenture. Prior to the exercise of any Securities Warrants to
purchase Preferred Shares or Common Shares, holders of such Securities Warrants
will not have any rights of holders of such Preferred Shares or Common Shares,
including the right to receive payments of dividends, if any, on such Preferred
Shares or Common Shares, or to exercise any applicable right to vote.
EXERCISE OF SECURITIES WARRANTS
Each Securities Warrant will entitle the holder thereof to purchase such
principal amount of Debt Securities or number of Preferred Shares or Common
Shares, as the case may be, at such exercise price as shall in each case be set
forth in, or calculable from, the Prospectus Supplement relating to the offered
Securities Warrants. After the close of business on the Expiration Date (or
such later date to which such Expiration Date may be extended by the Company),
unexercised Securities Warrants will become void.
Securities Warrants may be exercised by delivering to the Warrant Agent
payment as provided in the applicable Prospectus Supplement of the amount
required to purchase the Debt Securities, Preferred Shares or Common Shares, as
the case may be, purchasable upon such exercise together with certain
information set forth on the reverse side of the Securities Warrant certificate.
Securities Warrants will be deemed to have been exercised upon receipt of
payment of the exercise price, subject to the receipt within five (5) business
days, of the Securities Warrant certificate evidencing such Securities Warrants.
Upon receipt of such payment and the Securities Warrant certificate properly
completed and duly executed at the corporate trust office of the Warrant Agent
or any other office indicated in the applicable Prospectus Supplement, the
Company will, as soon as practicable, issue and deliver the Debt Securities,
Preferred Shares or Common Shares, as the case may be, purchasable upon such
exercise. If fewer than all of the Securities Warrants represented by such
Securities Warrant certificate are exercised, a new Securities Warrant
certificate will be issued for the remaining amount of Securities Warrants.
AMENDMENTS AND SUPPLEMENTS TO WARRANT AGREEMENT
The Warrant Agreements may be amended or supplemented without the consent
of the holders of the Securities Warrants issued thereunder to effect changes
that are not inconsistent with the provisions of the Securities Warrants and
that do not adversely affect the interests of the holders of the Securities
Warrants.
COMMON SHARES WARRANT ADJUSTMENTS
Unless otherwise indicated in the applicable Prospectus Supplement, the
exercise price of, and the number of Common Shares covered by, a Common Shares
Warrant are subject to adjustment in certain events, including (i) payment of a
dividend on the Common Shares payable in shares of beneficial interest, share
splits, combinations or reclassification of the Common Shares; (ii) issuance to
all holders of Common Shares of rights or warrants to subscribe for or purchase
Common Shares at less than their current market price; and (iii) certain
distributions of evidences of indebtedness or assets (including securities but
excluding cash dividends or distributions paid out of consolidated earnings or
retained earnings or dividends payable in Common Shares) or of subscription
rights and warrants (excluding those referred to above).
No adjustment in the exercise price of, and the number of Common Shares
covered by, a Common Shares Warrant will be made for regular quarterly or other
periodic or recurring cash dividends or distributions or for cash dividends or
distributions to the extent paid from consolidated earnings or retained
earnings. No adjustment will be required unless such adjustment would cause a
change of at least 1% in the exercise price then in effect. Except as stated
above, the exercise price of, and the number
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of Common Shares covered by, a Common Shares Warrant will not be adjusted for
the issuance of (i) Common Shares, (ii) any securities convertible into or
exchangeable for Common Shares, or (iii) any securities carrying the right or
option to purchase or otherwise acquire Common Shares, in exchange for cash,
other property or services.
In the event of any (i) consolidation or merger of the Company with or into
any entity (other than a consolidation or a merger that does not result in any
reclassification, conversion, exchange or cancellation of outstanding Common
Shares); (ii) sale, transfer, lease or conveyance of all or substantially all of
the assets of the Company; or (iii) reclassification, capital reorganization or
change of the Common Shares (other than solely a change in par value or from par
value to no par value), then any holder of a Common Shares Warrant will be
entitled, on or after the occurrence of any such event, to receive on exercise
of such Common Shares Warrant the kind and amount of shares of stock or other
securities, cash or other property (or any combination thereof) that the holder
would have received had such holder exercised such holder's Common Shares
Warrant immediately prior to the occurrence of such event. If the consideration
to be received upon exercise of the Common Shares Warrant following any such
event consists of common stock of the surviving entity, then from and after the
occurrence of such event, the exercise price of such Common Shares Warrant will
be subject to the same anti-dilution and other adjustments described in the
second preceding paragraph, applied as if such common stock were Common Shares.
PLAN OF DISTRIBUTION
The Company may sell Securities to or through one or more underwriters for
public offering and sale, or may also sell Securities directly to other
purchasers or through agents in exchange for cash or other consideration
(including real properties) as may be specified in the applicable Prospectus
Supplement. Direct sales to purchasers may also be accomplished through
subscription rights distributed to the Company's shareholders. In connection
with distribution of subscription rights to shareholders, if all of the
underlying Securities are not subscribed for, the Company may sell such
unsubscribed Securities directly to third parties or may engage the services of
underwriters to sell such unsubscribed Securities to third parties as may be
specified in the applicable Prospectus Supplement. Any underwriter or agent
involved in the offer and sale of the Securities will be named in the applicable
Prospectus Supplement.
The distribution of the Securities may be effected from time to time in one
or more transactions at a fixed price or prices, which may be changed, or at
market prices prevailing at the time of sale, at prices related to such
prevailing market prices or at negotiated prices (any of which may represent a
discount from the prevailing market prices). The Company also may offer and
sell the Securities in exchange for one or more of its then outstanding issues
of debt or convertible debt securities. The Company also may, from time to
time, authorize underwriters acting as the Company's agents to offer and sell
the Securities upon the terms and conditions set forth in the applicable
Prospectus Supplement.
In connection with the sale of Securities, underwriters may receive or be
deemed to have received compensation from the Company or from purchasers of
Securities, for whom they may act as agents, in the form of discounts,
concessions, or commissions. Underwriters may sell Securities to or through
dealers, and such dealers may receive compensation in the form of discounts,
concessions or commissions from the underwriters and/or commissions from the
purchasers for whom they may act as agents. Underwriters, dealers and agents
that participate in the distribution of Securities may be deemed to be
underwriters, and any discounts or commissions they receive from the Company,
and any profit on the resale of Securities they realize may be deemed to be
underwriting discounts and commissions under the Securities Act. Any such
underwriter or agent will be identified, and any such compensation received from
the Company will be described, in the applicable Prospectus Supplement.
Unless otherwise specified in the related Prospectus Supplement, each
series of Securities will be a new issue with no established trading market,
other than the Common Shares which are listed on the New York Stock Exchange.
Any Common Shares sold pursuant to a Prospectus Supplement will be listed on
such exchange, subject to official notice of issuance. The Company may elect to
list any series of Debt Securities or Preferred Shares on an exchange, but is
not obligated to do so. It is possible that one or more underwriters may make a
market in a series of Securities, but will not be obligated to do so and may
discontinue any market making at any time without notice. Therefore, no
assurance can be given as to the liquidity of the trading market for the
Securities.
Under agreements the Company may enter into, underwriters, dealers and
agents who participate in the distribution of Securities may be entitled to
indemnification by the Company against certain liabilities, including
liabilities under the Securities Act.
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Underwriters, dealers and agents may engage in transactions with, or
perform services for, or be customers of, the Company in the ordinary course of
business.
If so indicated in the Prospectus Supplement, the Company will authorize
underwriters or other persons acting as the Company's agents to solicit offers
by certain institutions to purchase Securities from the Company pursuant to
contracts providing for payment and delivery on a future date. Each contract
will be for an amount not less than, and the aggregate principal amount of
Securities sold pursuant to contracts shall be not less or more than, the
respective amounts stated in the applicable Prospectus Supplement. Institutions
with which such contracts may be made include commercial and savings banks,
insurance companies, pension funds, investment companies, educational and
charitable institutions and others, but in all cases such institutions must be
approved by the Company. The obligations of any purchaser under any such
contract will be subject to the condition that (i) the purchase of the
Securities shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject and (ii) if the Securities are
being sold to underwriters, the Company shall have sold to such underwriters the
total principal amount of the Securities less the principal amount thereof
covered by contracts. The underwriters and such other agents will not have any
responsibility in respect of the validity or performance of such contracts.
LEGAL OPINIONS
The legality of the Securities offered hereby as well as certain federal
income tax matters will be passed upon for the Company by Liddell, Sapp, Zivley,
Hill & LaBoon, L.L.P., 2001 Ross Avenue, Suite 3000, Dallas, Texas 75201.
EXPERTS
The consolidated financial statements and related financial statement
schedules incorporated in this Prospectus by reference from the Company's Annual
Report on Form 10-K for the year ended December 31, 1997 have been audited by
Deloitte & Touche LLP, independent auditors, as stated in their report, which is
incorporated herein by reference, and has been so incorporated in reliance upon
the report of such firm given upon their authority as experts in accounting and
auditing.
The Statement of Revenue and Certain Expenses of Rainbow Plaza Shopping
Center for the period January 1, 1997 to October 22, 1997, incorporated in this
Prospectus by reference from the Company's Current Report on Form 8-K dated
April 24, 1998 has been audited by Deloitte & Touche LLP, independent auditors,
as stated in their report, which is incorporated herein by reference, and has
been so incorporated in reliance upon the report of such firm given upon their
authority as experts in accounting and auditing.
The financial statements of Coronado Center, Ltd., Eastdale Center, Ltd.,
Mesquite Center, Ltd., and Tempe Valley Plaza, Ltd., in each case including the
balance sheets as of December 31, 1997 and the related statements of income,
venturer's capital and cash flows for each of the three years in the period
ended December 31, 1997, included in the Company's Current Report on Form 8-K
dated April 24, 1998 have been audited by Ernst & Young LLP, independent
auditors, as stated in their reports thereon which are incorporated herein by
reference, and have been so incorporated in reliance upon the reports of such
firm given upon their authority as experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN THE PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION.
The following table sets forth the estimated expenses in connection with
the offering contemplated by this Registration Statement:
<TABLE>
<S> <C>
SEC Registration Fee.......................... $100,595
Blue Sky Fees and Expenses.................... 15,000
Printing and Engraving Costs.................. 30,000
Accounting Fees and Expenses.................. 40,000
Legal Fees and Expenses....................... 120,000
Trustee and Registrar Fees.................... 20,000
Rating Agencies Fees.......................... 100,000
Miscellaneous................................. 54,405
--------
Total......................................... $480,000
========
</TABLE>
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS.
Subsection (B) of Section 9.20 of the Texas Real Estate Investment Trust
Act, as amended (the "Act"), empowers a real estate investment trust to
indemnify any person who was, is, or is threatened to be made a named defendant
or respondent in any threatened, pending, or completed action, suit, or
proceeding, whether civil, criminal, administrative, arbitrative, or
investigative, any appeal in such an action, suit, or proceeding, or any inquiry
or investigation that can lead to such an action, suit or proceeding because the
person is or was a trust manager, officer, employee or agent of the real estate
investment trust or is or was serving at the request of the real estate
investment trust as a trust manager, director, officer, partner, venturer,
proprietor, trustee, employee, agent, or similar functionary of another real
estate investment trust, corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan, or other enterprise against
expenses (including court costs and attorney fees), judgments, penalties, fines
and settlements if he conducted himself in good faith and reasonably believed
his conduct was in or not opposed to the best interests of the real estate
investment trust and, in the case of any criminal proceeding, had no reasonable
cause to believe that his conduct was unlawful.
The Act further provides that, except to the extent otherwise permitted by
the Act, a person may not be indemnified in respect of a proceeding in which the
person is found liable on the basis that personal benefit was improperly
received by him or in which the person is found liable to the real estate
investment trust. Indemnification pursuant to Subsection (B) of Section 9.20 of
the Act is limited to reasonable expenses actually incurred and may not be made
in respect of any proceeding in which the person has been found liable for
willful or intentional misconduct in the performance of his duty to the real
estate investment trust.
Subsection (C) of Section 15.10 of the Act provides that a trust manager
shall not be liable for any claims or damages that may result from his acts in
the discharge of any duty imposed or power conferred upon him by the real estate
investment trust, if, in the exercise of ordinary care, he acted in good faith
and in reliance upon information, opinions, reports, or statements, including
financial statements and other financial data, concerning the real estate
investment trust, that were prepared or presented by officers or employees of
the real estate investment trust, legal counsel, public accountants, investment
bankers, or certain other professionals, or a committee of trust managers of
which the trust manager is not a member. In addition, no trust manager shall be
liable to the real estate investment trust for any act, omission, loss, damage,
or expense arising from the performance of his duty to a real estate investment
trust, save only for his own willful misfeasance, willful malfeasance or gross
negligence.
Article Sixteen of the Company's Amended and Restated Declaration of Trust
provides that the Company shall indemnify officers and Trust Managers, as set
forth below:
(a) The Company shall indemnify, to the extent provided in the
Company's Bylaws, every person who is or was a Trust Manager or officer of
the Company or its corporate predecessor and any person who is or was
serving at the request of the Company or its corporate predecessor as a
director, officer, partner, venturer, proprietor, trustee, employee, agent
or similar functionary of another foreign or domestic corporation,
partnership, joint venture, sole
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proprietorship, trust, employee benefit plan or other enterprise with
respect to all costs and expenses incurred by such person as a result of
such person being made or threatened to be made a defendant or respondent
in a proceeding by reason of his holding or having held a position named
above in this paragraph.
(b) If the indemnification provided in paragraph (a) is either (i)
insufficient to cover all costs and expenses incurred by any person named
in such paragraph as a result of such person being made or threatened to be
made a defendant or respondent in a proceeding by reason of his holding or
having held a position named in such paragraph or (ii) not permitted by
Texas law, the Company shall indemnify, to the fullest extent that
indemnification is permitted by Texas law, every person who is or was a
Trust Manager or officer of the Company or its corporate predecessor and
any person who is or was serving at the request of the Company or its
corporate predecessor as a director, officer, partner, venturer,
proprietor, trustee, employee, agent or similar functionary of another
foreign or domestic corporation, partnership, joint venture, sole
proprietorship, trust, employee benefit plan or other enterprise with
respect to all costs and expenses incurred by such person as a result of
such person being made or threatened to be made a defendant or respondent
in a proceeding by reason of his holding or having held a position named
above in this paragraph.
The Company's Bylaws provide that the Company may indemnify any Trust
Manager or officer of the Company who was, is or is threatened to be made a
party to any suit or proceeding, whether civil, criminal, administrative,
arbitrative or investigative, because the person is or was a Trust Manager,
officer, employee or agent of the Company, or is or was serving at the request
of the Company in the same or another capacity in another corporation or
business association, against judgments, penalties, fines, settlements and
reasonable expenses actually incurred if it is determined that the person: (i)
conducted himself in good faith, (ii) reasonably believed that, in the case of
conduct in his official capacity, his conduct was in the best interests of the
Company, and that, in all other cases, his conduct was at least not opposed to
the best interests of the Company, and (iii) in the case of any criminal
proceeding, had no reasonable cause to believe his conduct was unlawful;
provided that, if the person is found liable to the Company, or is found liable
on the basis that personal benefit was improperly received by the person, the
indemnification (A) is limited to reasonable expenses actually incurred by the
person in connection with the proceeding and (B) will not be made in respect of
any proceeding in which the person shall have been found liable for willful or
intentional misconduct in the performance of his duty to the Company.
ITEM 16. EXHIBITS.
* (1)(a) Form of Underwriting Agreement for Debt Securities
* (1)(b) Form of Underwriting Agreement for Equity Securities
* (1)(c) Form of Distribution Agreement for Medium Term Notes
(4)(a) Form of Indenture for Senior Debt Securities (filed as Exhibit 4(a)
to the Company's Registration Statement on Form S-3 (No. 33-57659)
and incorporated herein by reference)
(4)(b) Form of Indenture for Subordinated Debt Securities (filed as
Exhibit 4(b) to the Company's Registration Statement on Form S-3
(No. 33-57659) and incorporated herein by reference)
* (4)(c) Form of Senior Debt Security
* (4)(d) Form of Subordinated Debt Security
* (4)(e) Form of Fixed Rate Senior Medium Term Note
* (4)(f) Form of Floating Rate Senior Medium Term Note
* (4)(g) Form of Fixed Rate Subordinated Medium Term Note
* (4)(h) Form of Floating Rate Subordinated Medium Term Note
(4)(i) Amended and Restated Declaration of Trust, as amended (filed as
Exhibit 3.1 to the Company's Registration Statement on Form S-3
(No. 33-49206) and incorporated herein by reference)
(4)(j) Bylaws of the Company (filed as Exhibit 3.2 of the Company's
Registration Statement on Form S-3 (No. 33-49206) and incorporated
herein by reference)
* (4)(k) Form of Statement of Designation of Preferred Shares
* (4)(l) Form of Preferred Share Certificate
* (4)(m) Form of Securities Warrant Agreement
(5) Opinion of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. as to the
legality of the securities being registered
(8) Opinion of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. as to
certain tax matters
(12) Statement regarding computation of ratios
(23)(a)(1) Consent of Deloitte & Touche LLP
(23)(a)(2) Consent of Ernst & Young LLP
(23)(b) Consent of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. (included
in Exhibit 5 hereto)
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(23)(c) Consent of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. (included
in Exhibit 8 hereto)
(24) Power of Attorney (included on signature page)
(25)(a) Statement of Eligibility of Trustee for Senior Debt Securities
(Chase Bank of Texas, National Association) on Form T-1
(25)(b) Statement of Eligibility of Trustee for Subordinated Debt
Securities (Chase Bank of Texas, National Association) on Form T-1
- ---------------------
* To be filed by amendment or incorporated by reference in connection with the
offering of the Securities.
ITEM 17. UNDERTAKINGS.
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are
being made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933, as amended (the "Securities Act");
(ii) To reflect in the prospectus any facts or events
arising after the effective date of the registration statement (or
the most recent post-effective amendment thereof) which,
individually or in the aggregate, represent a fundamental change
in the information set forth in the Registration Statement;
(iii) To include any material information with respect to
the plan of distribution not previously disclosed in the
registration statement or any material change to such information
in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply if
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed by the registrant pursuant to
Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (the
"Exchange Act"), that are incorporated by reference in the Registration
Statement.
(2) That, for the purpose of determining any liability under the
Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or 15(d) of the Exchange
Act (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Exchange Act) that is incorporated by
reference in the Registration Statement shall be deemed to be a new registration
statement relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(c) The undersigned registrant hereby further undertakes to supplement
the applicable prospectus supplement, after the expiration of the subscription
period, to set forth the results of the subscription offer, the transactions by
the underwriters during the subscription period, the amount of unsubscribed
securities to be purchased by the underwriters, and the terms of any subsequent
reoffering thereof. If any public offering by the underwriters is to be made on
terms differing from those set forth on the cover page of the prospectus, a
post-effective amendment will be filed to set forth the terms of such offering.
(d) Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the provisions described in Item 15 of this
Registration Statement or otherwise, the registrant has been advised that in the
opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than in payment by the registrant of expenses incurred or
paid by a trust manager, director, officer or controlling person in the
successful defense of any action, suit or proceeding) is asserted against the
registrant
II-3
<PAGE>
by such trust manager, director, officer or controlling person in connection
with the securities being registered hereby, the registrant will, unless in the
opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Act and will
be governed by the final adjudication of such issue.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Houston, State of Texas, on the 5th day of May, 1998.
WEINGARTEN REALTY INVESTORS
By: /s/Stanford Alexander
-----------------------------------
Stanford Alexander
Chairman
POWER OF ATTORNEY
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears
below hereby constitutes and appoints Stanford Alexander, Martin Debrovner,
Joseph W. Robertson, Jr. and Andrew M. Alexander, and each of them, his true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him, and on his behalf and in his name, place and stead, in
any and all capacities, to sign, execute and file this Registration Statement
under the Securities Act of 1933, as amended, and any or all amendments
(including, without limitation, post-effective amendments), with all exhibits
and any and all documents required to be filed with respect thereto, with the
Securities and Exchange Commission or any regulatory authority, granting unto
such attorneys-in-fact and agents, and each of them, full power and authority to
do and perform each and every act and thing requisite and necessary to be done
in and about the premises in order to effectuate the same, as fully to all
intents and purposes as he himself might or could do if personally present,
hereby ratifying and confirming all that such attorneys-in-fact and agents, or
any of them, or their substitute or substitutes, may lawfully do or cause to be
done.
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
======================================================================================
Signature Title Date
--------- ----- ----
- --------------------------------------------------------------------------------------
- --------------------------------------------------------------------------------------
<S> <C> <C>
/s/ Stanford Alexander Chairman and Trust Manager May 5, 1998
- ------------------------------ (Chief Executive Officer)
Stanford Alexander
- --------------------------------------------------------------------------------------
/s/ Andrew M. Alexander Executive Vice President/ May 5, 1998
- ------------------------------ Asset Management and Trust Manager
Andrew M. Alexander
- --------------------------------------------------------------------------------------
/s/ Robert J. Cruikshank Trust Manager May 5, 1998
- ------------------------------
Robert J. Cruikshank
- --------------------------------------------------------------------------------------
/s/ Martin Debrovner Vice Chairman and May 5, 1998
- ------------------------------ Trust Manager
Martin Debrovner
- --------------------------------------------------------------------------------------
</TABLE>
II-5
<PAGE>
<TABLE>
<CAPTION>
- --------------------------------------------------------------------------------------
<S> <C> <C>
/s/ Melvin A. Dow Trust Manager May 5, 1998
- ------------------------------
Melvin A. Dow
- --------------------------------------------------------------------------------------
/s/ Stephen A. Lasher Trust Manager May 5, 1998
- ------------------------------
Stephen A. Lasher
- --------------------------------------------------------------------------------------
/s/ Joseph W. Robertson, Jr. Executive Vice President and May 5, 1998
- ------------------------------ Trust Manager
Joseph W. Robertson, Jr. (Chief Financial Officer)
- --------------------------------------------------------------------------------------
/s/ Douglas W. Schnitzer Trust Manager May 5, 1998
- ------------------------------
Douglas W. Schnitzer
- --------------------------------------------------------------------------------------
/s/ Marc J. Shapiro Trust Manager May 5, 1998
- ------------------------------
Marc J. Shapiro
- --------------------------------------------------------------------------------------
/s/ J.T. Trotter Trust Manager May 5, 1998
- ------------------------------
J. T. Trotter
- --------------------------------------------------------------------------------------
/s/ Stephen C. Richter Vice President and Treasurer May 5, 1998
- ------------------------------ (Principal Accounting Officer)
Stephen C. Richter
======================================================================================
</TABLE>
II-6
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number
- ------
<S> <C>
*(1)(a) Form of Underwriting Agreement for Debt Securities
*(1)(b) Form of Underwriting Agreement for Equity Securities
*(1)(c) Form of Distribution Agreement for Medium Term Notes
(4)(a) Form of Indenture for Senior Debt Securities (filed as Exhibit 4(a) to
the Company's Registration Statement on Form S-3 (No. 33-57659) and
incorporated herein by reference)
(4)(b) Form of Indenture for Subordinated Debt Securities (filed as Exhibit
4(b) to the Company's Registration Statement on Form S-3 (No. 33-
57659) and incorporated herein by reference)
*(4)(c) Form of Senior Debt Security
*(4)(d) Form of Subordinated Debt Security
*(4)(e) Form of Fixed Rate Senior Medium Term Note
*(4)(f) Form of Floating Rate Senior Medium Term Note
*(4)(g) Form of Fixed Rate Subordinated Medium Term Note
*(4)(h) Form of Floating Rate Subordinated Medium Term Note
(4)(i) Amended and Restated Declaration of Trust, as amended (filed as
Exhibit 3.1 to the Company's Registration Statement on Form S-3 (No.
33-49206) and incorporated herein by reference)
(4)(j) Bylaws of the Company (filed as Exhibit 3.2 of the Company's
Registration Statement on Form S-3 (No. 33-49206) and incorporated
herein by reference)
*(4)(k) Form of Statement of Designation of Preferred Shares
*(4)(l) Form of Preferred Share Certificate
*(4)(m) Form of Securities Warrant Agreement
(5) Opinion of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. as to the
legality of the securities being registered
(8) Opinion of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. as to certain
tax matters
(12) Statement regarding computation of ratios
(23)(a)(1) Consent of Deloitte & Touche LLP
(23)(a)(2) Consent of Ernst & Young LLP
(23)(b) Consent of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. (included in
Exhibit 5 hereto)
(23)(c) Consent of Liddell, Sapp, Zivley, Hill & LaBoon, L.L.P. (included in
Exhibit 8 hereto)
(24) Power of Attorney (included on signature page)
(25)(a) Statement of Eligibility of Trustee for Senior Debt Securities
(Chase Bank of Texas, National Association) on Form T-1
(25)(b) Statement of Eligibility of Trustee for Subordinated Debt Securities
(Chase Bank of Texas, National Association) on Form T-1
</TABLE>
- ---------------------
* To be filed by amendment or incorporated by reference in connection with the
offering of the Securities.
<PAGE>
EXHIBIT 5
May 5, 1998
Weingarten Realty Investors
2600 Citadel Plaza Drive
Suite 300
Houston, Texas 77008
Re: $400,000,000 Aggregate Offering Price of
Securities of Weingarten Realty Investors
Gentlemen:
We are acting as securities counsel to Weingarten Realty Investors, a Texas
real estate investment trust (the "Company"), in connection with the
registration statement on Form S-3 (the "Registration Statement") being filed by
you with the Securities and Exchange Commission (the "Commission") under the
Securities Act of 1933, as amended (the "Act"), relating to the offering from
time to time pursuant to Rule 415 under the Act, as set forth in the prospectus
contained in the Registration Statement (the "Prospectus") and as to be set
forth in one or more supplements to the Prospectus (each a "Prospectus
Supplement"), by the Company of up to $400,000,000 aggregate offering price of
(i) one or more series of senior or subordinated debt securities (the "Debt
Securities"), (ii) one or more series of preferred shares of beneficial
interest, par value of $0.03 per share (the "Preferred Shares"), (iii) common
shares of beneficial interest, par value $0.03 per share (the "Common Shares"),
and/or (iv) warrants to purchase Debt Securities, Preferred Shares or Common
Shares (referred to herein collectively as the "Securities Warrants"). The Debt
Securities, Preferred Shares, Common Shares and Securities Warrants are
collectively referred to as the "Securities."
In our capacity as your counsel in connection with such registration, we
have made such legal and factual examinations and inquiries, including an
examination of originals or copies, certified or otherwise identified to our
satisfaction, of such documents, corporate records, certificates of public
officials and other instruments as we have deemed necessary or advisable in
connection with this opinion, including (a) the Restated Declaration of Trust of
the Company and the Bylaws of the Company, each as amended to date, (b) the
Indenture, dated as of May 1, 1995, executed by the Company and Chase Bank of
Texas, National Association (formerly known as Texas Commerce Bank
<PAGE>
Weingarten Realty investors
May 5, 1998
Page 2
National Association), as trustee, relating to senior Debt Securities (the
"Senior Indenture"), (c) the Indenture, dated as of May 1, 1995, executed by the
Company and Chase Bank of Texas, National Association (formerly known as Texas
Commerce Bank National Association), as trustee, relating to subordinated Debt
Securities (the "Subordinated Indenture"), and (d) the Registration Statement.
In our examination, we have assumed the genuineness of all signatures, the legal
capacity of natural persons, the authenticity of all documents submitted to us
as originals, the conformity to original documents of all documents submitted to
us as certified or photostatic copies, the authenticity of the originals of such
copies and the authenticity of telegraphic or telephonic confirmations of public
officials and others. As to facts material to our opinion, we have relied upon
certificates or telegraphic or telephonic confirmations of public officials and
certificates, documents, statements and other information of the Company or
representatives or officers thereof.
The opinions set forth below address the effect on the subject transaction
only of the federal laws of the United States and the internal laws of the State
of Texas, and we express no opinion with respect to the applicability thereto,
or the effect thereon, of the laws of any other jurisdiction.
Subject to the foregoing and the other matters set forth herein, it is our
opinion that, as of the date hereof:
1. The Senior Indenture and the Subordinated Indenture have been duly
authorized by the Company, duly executed and delivered by the Company to Chase
Bank of Texas, National Association (formerly known as Texas Commerce Bank
National Association), as trustee (the "Trustee"), and duly qualified under the
Trust Indenture Act of 1939, as amended, and are the legally valid and binding
agreements of the Company, enforceable against the Company in accordance with
their respective terms.
2. The registration of the Debt Securities has been duly authorized by
the Company, and when the Debt Securities have been duly established by the
applicable Indenture, duly authenticated by the Trustee and duly executed and
delivered on behalf of the Company against payment therefor in accordance with
the terms and provisions of the applicable Indenture and as contemplated by the
Registration Statement and the applicable Prospectus Supplement, and in
accordance with the applicable definitive purchase, underwriting or similar
agreement approved by the Board of Trust Managers (the "Board"), the Debt
Securities will constitute legally valid and binding obligations of the Company,
enforceable against the Company in accordance with their terms.
3. The registration of the Preferred Shares has been duly authorized by
the Company, and when the Preferred Shares have been duly established in
accordance with the terms of the Company's Statement of Designation defining the
rights and preferences of the Preferred Shares, and applicable law, and, upon
issuance, delivery and payment therefor in the manner contemplated by the
Registration Statement and the applicable Prospectus Supplement, and in
accordance with the
<PAGE>
Weingarten Realty investors
May 5, 1998
Page 3
applicable definitive purchase, underwriting or similar agreement approved by
the Board, the Preferred Shares will be duly authorized, validly issued, fully
paid and nonassessable.
4. The registration of the Common Shares has been duly authorized, and
upon issuance, delivery and payment therefor in the manner contemplated by the
Registration Statement and the applicable Prospectus Supplement, and in
accordance with the applicable definitive purchase, underwriting or similar
agreement approved by the Board, the Common Shares will be duly authorized,
validly issued, fully paid and nonassessable.
5. The registration of the Securities Warrants has been duly authorized
by the Company, and when the final terms thereof have been duly established, and
when duly executed and delivered by the Company and countersigned by the
applicable financial institution identified as the warrant agent (the "Warrant
Agent") in accordance with the applicable warrant agreement (the "Warrant
Agreement") and delivered to and paid for by the purchasers thereof in the
manner contemplated by the Registration Statement and the applicable Prospectus
Supplement, and in accordance with the applicable definitive purchase,
underwriting or similar agreement approved by the Board, the Securities Warrants
will constitute legally valid and binding obligations of the Company,
enforceable against the Company in accordance with their respective terms.
The opinions set forth above are subject to the following exceptions,
limitations and qualifications: (i) the effect of bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to or affecting the rights and remedies of creditors, (ii) the effect
of general principles of equity, whether enforcement is considered in a
proceeding in equity or at law, and the discretion of the court before which any
proceeding therefor may be brought, (iii) the unenforceability under certain
circumstances under law or court decisions of provisions providing for the
indemnification of or contribution to a party with respect to a liability where
such indemnification or contribution is contrary to public policy, (iv) we
express no opinion concerning the enforceability of the waiver of rights or
defenses contained in Section 514 of the Indenture, and (v) we express no
opinion with respect to whether acceleration of Debt Securities may affect the
collectability of any portion of the stated principal amount thereof which might
be determined to constitute unearned interest thereon.
To the extent that the obligations of the Company under the Senior
Indenture or Subordinated Indenture may be dependent upon such matters, we
assume for purposes of this opinion that the Trustee is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization; that the Trustee is duly qualified to engage in the activities
contemplated by the applicable Indenture, that the applicable Indenture has been
duly authorized, executed and delivered by the Trustee and constitutes the
legally valid and binding obligation of the Trustee enforceable against the
Trustee in accordance with its terms; that the Trustee is in compliance,
generally with respect to acting as a trustee under the applicable Indenture,
with all applicable laws and regulations;
<PAGE>
Weingarten Realty investors
May 5, 1998
Page 4
and that the Trustee has the requisite organizational and legal power and
authority to perform its obligations under the applicable Indenture.
To the extent that the obligations of the Company under each Warrant
Agreement may be dependent upon such matters, we assume for purposes of this
opinion that the Warrant Agent is duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization; that the Warrant
Agent is duly qualified to engage in the activities contemplated by the Warrant
Agreement; that the Warrant Agreement has been duly authorized, executed and
delivered by the Warrant Agent and constitutes the legally valid and binding
obligation of the Warrant Agent enforceable against the Warrant Agent in
accordance with its terms; that the Warrant Agent is in compliance, generally
with respect to acting as a Warrant Agent under the Warrant Agreement, with all
applicable laws and regulations; and that the Warrant Agent has the requisite
organizational and legal power and authority to perform its obligations under
the Warrant Agreement.
For the purposes of this opinion, we have assumed that (i) the Registration
Statement, and any amendments thereto (including post-effective amendments),
will have become effective, (ii) a Prospectus Supplement will have been prepared
and filed with the Commission describing the Securities offered thereby, (iii)
all Securities will be issued and sold in compliance with applicable federal and
state securities laws and in the manner stated in the Registration Statement and
the appropriate Prospectus Supplement, and (iv) a definitive purchase,
underwriting or similar agreement with respect to any Securities offered will
have been duly authorized and validly executed and delivered by the Company and
the other parties thereto.
We consent to your filing this opinion as an exhibit to the Registration
Statement and to the reference to our firm under the caption "Legal Opinions" in
the prospectus included therein.
This opinion is rendered only to you and is solely for your benefit in
connection with the transactions covered hereby. This opinion may not be relied
upon by you for any other purpose, or furnished to, quoted to, or relied upon by
any other person, firm or corporation for any purpose, without our prior written
consent.
Very truly yours,
/s/ LIDDELL, SAPP, ZIVLEY, HILL & LABOON, L.L.P.
LIDDELL, SAPP, ZIVLEY, HILL
& LABOON, L.L.P.
<PAGE>
EXHIBIT 8
May 5, 1998
Weingarten Realty Investors
2600 Citadel Plaza Drive
Houston, Texas 77008
Ladies and Gentlemen:
These opinions are delivered to you in our capacity as counsel to
Weingarten Realty Investors, a Texas real estate investment trust (the
"Company"), in connection with the registration statement on Form S-3, dated May
5, 1998, being filed by the Company with the Securities and Exchange Commission,
as amended (the "Registration Statement"). These opinions relate to (i) the
Company's qualification for federal income tax purposes as a real estate
investment trust (a "REIT") under the Internal Revenue Code of 1986, as amended
(the "Code"), for taxable years commencing with the Company's taxable year
ending December 31, 1997; and (ii) the accuracy of the "UNITED STATES TAXATION"
section (the "Tax Section") which will be contained in one or more supplements
to the prospectus contained in the Registration Statement (such supplements are
referred to herein as "Prospectus Supplements").
In rendering the following opinions, we have examined the Declaration of
Trust and Bylaws of the Company, as amended to date, and such other records,
certificates and documents as we have deemed necessary or appropriate for
purposes of rendering the opinions set forth herein.
We have reviewed the descriptions set forth in the Registration Statement
of the Company and its investments, activities, operations and governance. We
have relied upon the facts set forth in the Registration Statement and upon the
representations of officers of the Company that the Company has been and will be
owned and operated in such a manner that the Company has and will continue to
satisfy the requirements for qualification as a REIT under the Code. We assume
that the Company has been and will be operated in accordance with applicable
laws and the terms and conditions of applicable documents. In addition, we have
relied on certain additional facts and assumptions described below.
In rendering the opinions set forth herein, we have assumed (i) the
genuineness of all signatures on documents we have examined, (ii) the
authenticity of all documents submitted to us as originals, (iii) the conformity
to the original documents of all documents submitted to us as
<PAGE>
Weingarten Realty Investors
May 5, 1998
Page 2
copies, (iv) the conformity of final documents to all documents submitted to us
as drafts, (v) the authority and capacity of the individual or individuals who
executed any such documents on behalf of any party, (vi) the accuracy and
completeness of all records made available to us and (vii) the factual accuracy
of all representations, warranties and other statements made by all parties. We
have also assumed, without investigation, that all documents, certificates,
representations, warranties and covenants upon which we have relied in rendering
the opinions set forth below and that were given or dated earlier than the date
of this letter continue to remain accurate, insofar as relevant to the opinions
set forth herein, from such earlier date through and including the date of this
letter.
The discussion and conclusions set forth below are based upon the Code, the
Income Tax Regulations and Procedure and Administration Regulations promulgated
thereunder and existing administrative and judicial interpretations thereof, all
of which are subject to change. No assurance can therefore be given that the
federal income tax consequences described below will not be altered in the
future.
Based upon and subject to the foregoing discussion and the discussion of
the federal income tax considerations that relate to the tax treatment of the
Company and its shareholders as set forth in the Tax Section of any and all
Prospectus Supplements, we are of the opinion that (i) the Company has qualified
as a REIT for the taxable year ending December 31, 1997, and (ii) the form of
organization of the Company, its operations through the date hereof and its
proposed operations for future periods, are such as to enable the Company to
qualify as a REIT under the Code for subsequent taxable years provided that in
each such year the Company meets the applicable asset composition, source of
income, shareholder diversification, distribution, recordkeeping and other
requirements of the Code necessary for the Company to qualify as a REIT.
In our capacity as counsel to the Company, we will review the discussion in
the Tax Section of any Prospectus Supplements. The discussion contained in any
such Tax Section will be an accurate summary of the respective matters described
therein.
We express no opinion with respect to the transactions described herein and
in the Registration Statement other than those expressly set forth herein. You
should recognize that our opinions are not binding on the Internal Revenue
Service (the "IRS") and that the IRS may disagree with the opinions contained
herein. Although we believe that our opinions will be sustained if challenged,
there can be no assurance that this will be the case. Except as specifically
discussed above, the opinions expressed herein are based upon the law as it
currently exists. Consequently, future changes in the law may cause the federal
income tax treatment of the transactions described herein to be materially and
adversely different from that described above.
<PAGE>
Weingarten Realty Investors
May 5, 1998
Page 3
We consent to being named as counsel to the Company in the Registration
Statement, to the references in the Registration Statement to our firm and to
the inclusion of this opinion letter as an exhibit to the Registration
Statement.
Very truly yours,
/s/ LIDDELL, SAPP, ZIVLEY, HILL & LABOON, L.L.P.
LIDDELL, SAPP, ZIVLEY, HILL
& LABOON, L.L.P.
<PAGE>
EXHIBIT 12
WEINGARTEN REALTY INVESTORS
COMPUTATION OF RATIO OF EARNINGS AND FUNDS FROM
OPERATIONS TO COMBINED FIXED CHARGES AND PREFERRED SHARE DIVIDENDS
(DOLLAR AMOUNTS IN THOUSANDS)
<TABLE>
<CAPTION>
Year Ended December 31
------------------------------------------------
Three Months
Ended
1993 1994 1995 1996 1997 March 31, 1998
-------- ------- ------- --------- --------- --------------
<S> <C> <C> <C> <C> <C> <C>
Income before extraordinary charge $36,249 $43,788 $44,802 $ 53,938 $ 54,966 $14,295
Add:
Portion of rents representative of the
interest factor 521 521 572 605 667 203
Interest on indebtedness 10,046 10,694 16,707 21,975 30,009 8,334
Amortization of debt cost 261 456 246 355 432 99
------- ------- ------- -------- -------- -------
Net income as adjusted $47,077 $55,459 $62,327 $ 76,873 $ 86,074 $22,931
======= ======= ======= ======== ======== =======
Fixed Charges:
Interest on indebtedness $10,046 $10,694 $16,707 $ 21,975 $ 30,009 $ 8,334
Capitalized interest 1,114 1,670 2,878 1,285 812 272
Preferred dividends 0 0 0 0 0 574
Amortization of debt cost 261 456 246 355 432 99
Portion of rents representative of the
interest factor 521 521 572 605 667 203
------- ------- ------- -------- -------- -------
Fixed charges $11,942 $13,341 $20,403 $ 24,220 $ 31,920 $ 9,482
======= ======= ======= ======== ======== =======
RATIO OF EARNINGS TO COMBINED FIXED
CHARGES AND PREFERRED SHARE DIVIDENDS 3.94 4.16 3.05 3.17 2.70 2.42
======= ======= ======= ======== ======== =======
Net income available to common
shareholders $36,249 $43,788 $44,802 $ 53,938 $ 54,966 $12,329
Depreciation and amortization 23,382 26,842 29,813 33,414 37,544 9,987
Extraordinary charge 0 0 0 0 0 1,392
(Gains) loss on sales of property (1,631) 234 14 (5,563) (3,327) (83)
------- ------- ------- -------- -------- -------
Funds from operations 58,000 70,864 74,629 81,789 89,183 23,625
Portion of rents representative of the
interest factor 521 521 572 605 667 203
Amortization of debt cost 261 456 246 355 432 99
Preferred dividends 0 0 0 0 0 574
Interest on indebtedness 10,046 10,694 16,707 21,975 30,009 8,334
------- ------- ------- -------- -------- -------
Funds from operations (as adjusted) $68,828 $82,535 $92,154 $104,724 $120,291 $32,835
======= ======= ======= ======== ======== =======
RATIO OF FUNDS FROM
OPERATIONS TO COMBINED FIXED CHARGES
AND PREFERRED SHARE DIVIDENDS 5.76 6.18 4.51 4.32 3.77 3.46
======= ======= ======= ======== ======== =======
</TABLE>
<PAGE>
EXHIBIT 23(a)(1)
CONSENT OF INDEPENDENT AUDITORS
We consent to the incorporation by reference in this Registration Statement of
Weingarten Realty Investors on Form S-3 of our reports dated February 20, 1998,
except for Note 13, as to which the date is February 24, 1998, included and
incorporated by reference in the Annual Report on Form 10-K of Weingarten Realty
Investors for the year ended December 31, 1997, and our report dated April 2,
1998 (relating to the Statement of Revenues and Certain Expenses of Rainbow
Plaza Shopping Center for the period from January 1, 1997 to October 22, 1997
appearing in the Current Report on Form 8-K of Weingarten Realty Investors filed
with the Securities and Exchange Commission on April 24, 1998, and to the
reference to us under the heading "Experts" in the Prospectus, which is part of
this Registration Statement.
/s/ Deloitte & Touche LLP
Deloitte & Touche LLP
Houston, Texas
April 29,1998
<PAGE>
EXHIBIT 23(a)(2)
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" and to the
incorporation by reference of our reports dated February 20, 1998 relating to
the financial statements of Coronado Center, Ltd., Eastdale Center, Ltd.,
Mesquite Center, Ltd., and Tempe Valley Plaza, Ltd. included in Weingarten
Realty Investors' Current Report (Form 8-K) filed with the Securities and
Exchange Commission on April 24, 1998, in this Registration Statement (Form S-3)
and related Prospectus of Weingarten Realty Investors for the registration of
$400,000,000 debt securities, preferred shares, common shares and securities
warrants.
/s/ Ernst & Young LLP
Houston, Texas
April 28, 1998
<PAGE>
EHIBIT 25(a)
**********************************************************************
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE
ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)
--------
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
(Exact name of trustee as specified in its charter)
74-0800980
(I.R.S. Employer Identification No.)
712 Main Street, Houston, Texas 77002
(Address of principal executive offices) (Zip code)
Lee Booker, 712 Main Street, 26th Floor,
Houston, Texas 77002, (713) 216-2448
(Name, address and telephone number of agent for service)
WEINGARTEN REALTY INVESTORS
(Exact name of obligor as specified in its charter)
Texas 74-1464203
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2600 Citadel Plaza Drive, Houston, Texas 77008
(Address of principal executive offices) (Zip Code)
Senior Debt Securities
******************************************************************************
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee--
a. Name and address of each examining or supervising authority to
which it is subject.
Comptroller of the Currency, Washington, D. C.
Federal Deposit Insurance Corporation,
Washington, D. C.
The Board of Governors of the Federal Reserve System, Washington, D.C.
b. Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
No such affiliation exists.
See Note, Page 8 hereof.
ITEM 3. VOTING SECURITIES OF THE TRUSTEE.
Furnish the following information as to each class of voting securities of
the trustee.
================================================================================
Column A Column B
Title of Class Amount Outstanding
- --------------------------------------------------------------------------------
================================================================================
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
2
<PAGE>
ITEM 4. TRUSTEESHIPS UNDER OTHER INDENTURES.
If the trustee is a trustee under another indenture under which any other
securities, or certificates of interest or participation in any other
securities, of the obligor are outstanding, furnish the following information:
a. Title of the security outstanding under each such other indenture.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
b. A brief statement of the facts relied upon as a basis for the claim
that no conflicting interest within the meaning of Section 310(b)(1)
of the Act arises as a result of the trusteeship under any such other
indenture, including a statement as to how the indenture securities
will rank as compared with the securities issued under such other
indenture.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH OBLIGOR OR
UNDERWRITERS.
If the trustee or any of the directors or executive officers of the trustee
is a director, officer, partner, employee, appointee, or representative of the
obligor or of any underwriter for the obligor, identify each such person having
any such connection and state the nature of each such connection.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS
OFFICIALS.
Furnish the following information as to the voting securities of the
trustee owned beneficially by the obligor and each director, partner and
executive officer of the obligor.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
3
<PAGE>
ITEM 7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR
OFFICIALS.
Furnish the following information as to the voting securities of the
trustee owned beneficially by each underwriter for the obligor and each
director, partner, and executive officer of each such underwriter.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE.
Furnish the following information as to securities of the obligor owned
beneficially or held as collateral security for obligations in default by the
trustee.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 9. SECURITIES OF UNDERWRITERS OWNED OR HELD BY THE TRUSTEE.
If the trustee owns beneficially or holds as collateral security for
obligations in default any securities of an underwriter for the obligor, furnish
the following information as to each class of securities of such underwriter any
of which are so owned or held by the trustee.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN
AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR.
If the trustee owns beneficially or holds as collateral security for
obligations in default voting securities of a person who, to the knowledge of
the trustee (1) owns 10% or more of the voting securities of the obligor or (2)
is an affiliate, other than a subsidiary, of the obligor, furnish the following
information as to the voting securities of such person.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
4
<PAGE>
ITEM 11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON
OWNING 50% OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR.
If the trustee owns beneficially or holds as collateral security for
obligations in default any securities of a person who, to the knowledge of the
trustee, owns 50% or more of the voting securities of the obligor, furnish the
following information as to each class of securities of such person any of which
are so owned or held by the trustee.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE.
Except as noted in the instructions to the Form T-1, if the obligor is
indebted to the trustee, furnish the following information: nature of
indebtedness, amount outstanding and date due.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 13. DEFAULTS BY THE OBLIGOR.
a. State whether there is or has been a default with respect to the
securities under this indenture. Explain the nature of any such
default.
No such default exists or has existed. (See Note on Page 8.)
b. If the trustee is a trustee under another indenture under which any
other securities, or certificates of interest or participation in any
other securities, of the obligor are outstanding, or is trustee for
more than one outstanding series of securities under the indenture,
state whether there has been a default under any such indenture or
series, identify the indenture or series affected, and explain the
nature of any such default.
There has not been a default under any such indenture
or series. (See Note on Page 8.)
5
<PAGE>
ITEM 14. AFFILIATIONS WITH THE UNDERWRITERS.
If any underwriter is an affiliate of the trustee, describe each such
affiliation.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 15. FOREIGN TRUSTEE.
Identify the order or rule pursuant to which the foreign trustee is
authorized to act as sole trustee under indentures qualified or to be qualified
under the Act.
Not applicable.
ITEM 16. LIST OF EXHIBITS.
List below all exhibits filed as part of this statement of eligibility.
* 1. A copy of the articles of association of the trustee as now
in effect.
** 2. A copy of the certificate of authority of the trustee to
commence business.
*** 3. A copy of the certificate of authorization of the trustee to
exercise corporate trust powers.
[] 4. A copy of the existing bylaws of the trustee.
5. A copy of each indenture referred to in Item 4, if the
obligor is in default. Not Applicable
*** 6. The consent of the United States institutional trustees
required by Section 321(b) of the Act.
# 7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
8. A copy of any order pursuant to which the foreign trustee is
authorized to act as sole trustee under indentures qualified
or to be qualified under the Act. Not applicable.
6
<PAGE>
9. Foreign trustees are required to file a consent to service
of process on Form F-X. Not applicable.
Effective January 20, 1998, the name of the Trustee was changed from Texas
Commerce Bank National Association to Chase Bank of Texas, National Association.
The exhibits incorporated herein by reference, including Exhibit 7, the
Trustee's Consolidated Reports of Condition and Income for the fourth quarter of
1997, were filed under the former name of the Trustee.
* Incorporated by reference to exhibit bearing the same designation and
previously filed with the Securities and Exchange Commission with
respect to File No. 33-56195.
** Incorporated by reference to exhibit bearing the same designation
previously filed with the Securities and Exchange Commission as an
exhibit to the Form S-3 File No. 33-42814.
*** Incorporated by reference to exhibit bearing the same designation and
previously filed with the Securities and Exchange Commission as an
exhibit to the Form S-11 File No. 33-25132.
[] Incorporated by reference to exhibit bearing the same designation
filed with the Securities and Exchange Commission as an exhibit to
File No. 33-65055.
# Incorporated by reference to exhibit bearing the same designation and
previously filed with the Securities and Exchange Commission as an
exhibit to the Form S-4 File No. 333-47745
7
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
trustee, Chase Bank of Texas, National Association, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Houston, and State of Texas, on the 5th day of May, 1998.
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
(Trustee)
By: /s/ DONNA EDMUNDSON
--------------------------------------
Donna Edmundson, Vice President
--------------------------------------
NOTE
Inasmuch as this statement is filed prior to the final determination of all
facts on which to base responsive answers to items 2 and 13, the answers to said
items are based on incomplete information, but may be considered as correct
unless additional information is furnished by amendment.
<PAGE>
EXHIBIT 25(b)
**********************************************************************
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
STATEMENT OF ELIGIBILITY UNDER THE TRUST INDENTURE
ACT OF 1939 OF A CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)
---------
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
(Exact name of trustee as specified in its charter)
74-0800980
(I.R.S. Employer Identification No.)
712 Main Street, Houston, Texas 77002
(Address of principal executive offices) (Zip code)
Lee Booker, 712 Main Street, 26th Floor,
Houston, Texas 77002, (713) 216-2448
(Name, address and telephone number of agent for service)
WEINGARTEN REALTY INVESTORS
(Exact name of obligor as specified in its charter)
Texas 74-1464203
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2600 Citadel Plaza Drive, Houston, Texas 77008
(Address of principal executive offices) (Zip Code)
Subordinated Debt Securities
******************************************************************************
<PAGE>
ITEM 1. GENERAL INFORMATION.
Furnish the following information as to the trustee--
(a) Name and address of each examining or supervising authority to which
it is subject.
Comptroller of the Currency, Washington, D. C.
Federal Deposit Insurance Corporation,
Washington, D. C.
The Board of Governors of the Federal Reserve System, Washington, D.C.
(b) Whether it is authorized to exercise corporate trust powers.
The trustee is authorized to exercise corporate trust powers.
ITEM 2. AFFILIATIONS WITH THE OBLIGOR.
If the obligor is an affiliate of the trustee, describe each such
affiliation.
No such affiliation exists.
See Note, Page 8 hereof.
ITEM 3. VOTING SECURITIES OF THE TRUSTEE.
Furnish the following information as to each class of voting securities of
the trustee.
===============================================================================
Column A Column B
Title of Class Amount Outstanding
- -------------------------------------------------------------------------------
===============================================================================
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
2
<PAGE>
ITEM 4. TRUSTEESHIPS UNDER OTHER INDENTURES.
If the trustee is a trustee under another indenture under which any other
securities, or certificates of interest or participation in any other
securities, of the obligor are outstanding, furnish the following information:
(a) Title of the security outstanding under each such other indenture.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
(b) A brief statement of the facts relied upon as a basis for the claim
that no conflicting interest within the meaning of Section 310(b)(1)
of the Act arises as a result of the trusteeship under any such other
indenture, including a statement as to how the indenture securities
will rank as compared with the securities issued under such other
indenture.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 5. INTERLOCKING DIRECTORATES AND SIMILAR RELATIONSHIPS WITH
OBLIGOR OR UNDERWRITERS.
If the trustee or any of the directors or executive officers of the trustee
is a director, officer, partner, employee, appointee, or representative of the
obligor or of any underwriter for the obligor, identify each such person having
any such connection and state the nature of each such connection.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 6. VOTING SECURITIES OF THE TRUSTEE OWNED BY THE OBLIGOR OR ITS
OFFICIALS.
Furnish the following information as to the voting securities of the
trustee owned beneficially by the obligor and each director, partner and
executive officer of the obligor.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
3
<PAGE>
ITEM 7. VOTING SECURITIES OF THE TRUSTEE OWNED BY UNDERWRITERS OR THEIR
OFFICIALS.
Furnish the following information as to the voting securities of the
trustee owned beneficially by each underwriter for the obligor and each
director, partner, and executive officer of each such underwriter.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 8. SECURITIES OF THE OBLIGOR OWNED OR HELD BY THE TRUSTEE.
Furnish the following information as to securities of the obligor owned
beneficially or held as collateral security for obligations in default by the
trustee.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 9. SECURITIES OF UNDERWRITERS OWNED OR HELD BY THE TRUSTEE.
If the trustee owns beneficially or holds as collateral security for
obligations in default any securities of an underwriter for the obligor, furnish
the following information as to each class of securities of such underwriter any
of which are so owned or held by the trustee.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 10. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF VOTING SECURITIES OF CERTAIN
AFFILIATES OR SECURITY HOLDERS OF THE OBLIGOR.
If the trustee owns beneficially or holds as collateral security for
obligations in default voting securities of a person who, to the knowledge of
the trustee (1) owns 10% or more of the voting securities of the obligor or (2)
is an affiliate, other than a subsidiary, of the obligor, furnish the following
information as to the voting securities of such person.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
4
<PAGE>
ITEM 11. OWNERSHIP OR HOLDINGS BY THE TRUSTEE OF ANY SECURITIES OF A PERSON
OWNING 50% OR MORE OF THE VOTING SECURITIES OF THE OBLIGOR.
If the trustee owns beneficially or holds as collateral security for
obligations in default any securities of a person who, to the knowledge of the
trustee, owns 50% or more of the voting securities of the obligor, furnish the
following information as to each class of securities of such person any of which
are so owned or held by the trustee.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 12. INDEBTEDNESS OF THE OBLIGOR TO THE TRUSTEE.
Except as noted in the instructions to the Form T-1, if the obligor is
indebted to the trustee, furnish the following information: nature of
indebtedness, amount outstanding and date due.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 13. DEFAULTS BY THE OBLIGOR.
(a) State whether there is or has been a default with respect to the
securities under this indenture. Explain the nature of any such
default.
No such default exists or has existed. (See Note on
Page 8.)
(b) If the trustee is a trustee under another indenture under which any
other securities, or certificates of interest or participation in any
other securities, of the obligor are outstanding, or is trustee for
more than one outstanding series of securities under the indenture,
state whether there has been a default under any such indenture or
series, identify the indenture or series affected, and explain the
nature of any such default.
There has not been a default under any such indenture
or series. (See Note on Page 8.)
5
<PAGE>
ITEM 14. AFFILIATIONS WITH THE UNDERWRITERS.
If any underwriter is an affiliate of the trustee, describe each such
affiliation.
Not applicable by virtue of Form T-1 General
Instruction B and response to Item 13.
ITEM 15. FOREIGN TRUSTEE.
Identify the order or rule pursuant to which the foreign trustee is
authorized to act as sole trustee under indentures qualified or to be qualified
under the Act.
Not applicable.
ITEM 16. LIST OF EXHIBITS.
List below all exhibits filed as part of this statement of eligibility.
* 1. A copy of the articles of association of the trustee as
now in effect.
** 2. A copy of the certificate of authority of the trustee to
commence business.
*** 3. A copy of the certificate of authorization of the
trustee to exercise corporate trust powers.
. 4. A copy of the existing bylaws of the trustee.
5. A copy of each indenture referred to in Item 4, if the
obligor is in default. Not Applicable.
*** 6. The consent of the United States institutional trustees
required by Section 321(b) of the Act.
# 7. A copy of the latest report of condition of the trustee
published pursuant to law or the requirements of its
supervising or examining authority.
8. A copy of any order pursuant to which the foreign trustee
is authorized to act as sole trustee under indentures
qualified or to be qualified under the Act. Not applicable.
6
<PAGE>
9. Foreign trustees are required to file a consent to service
of process on Form F-X. Not applicable.
Effective January 20, 1998, the name of the Trustee was changed from Texas
Commerce Bank National Association to Chase Bank of Texas, National Association.
The exhibits incorporated herein by reference, including Exhibit 7, the
Trustee's Consolidated Reports of Condition and Income for the fourth quarter of
1997, were filed under the former name of the Trustee.
* Incorporated by reference to exhibit bearing the same designation
and previously filed with the Securities and Exchange Commission with
respect to File No. 33-56195.
** Incorporated by reference to exhibit bearing the same designation
previously filed with the Securities and Exchange Commission as an exhibit
to the Form S-3 File No. 33-42814.
*** Incorporated by reference to exhibit bearing the same designation and
previously filed with the Securities and Exchange Commission as an exhibit
to the Form S-11 File No. 33-25132.
. Incorporated by reference to exhibit bearing the same designation filed
with the Securities and Exchange Commission as an exhibit to File No. 33-
65055.
# Incorporated by reference to exhibit bearing the same designation and
previously filed with the Securities and Exchange Commission as
an exhibit to the Form S-4 File No. 333-47745.
7
<PAGE>
SIGNATURE
Pursuant to the requirements of the Trust Indenture Act of 1939 the
trustee, Chase Bank of Texas, National Association, a national banking
association organized and existing under the laws of the United States of
America, has duly caused this statement of eligibility to be signed on its
behalf by the undersigned, thereunto duly authorized, all in the City of
Houston, and State of Texas, on the 5th day of May, 1998.
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
(Trustee)
By: /s/ DONNA EDMUNDSON
--------------------------------------
Donna Edmundson, Vice President
--------------------------------------
NOTE
Inasmuch as this statement is filed prior to the final determination of all
facts on which to base responsive answers to items 2 and 13, the answers to said
items are based on incomplete information, but may be considered as correct
unless additional information is furnished by amendment.
8
