UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-K/A
AMENDMENT NO. 1
[X] Annual Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 [Fee Required]
For the fiscal year ended December 31, 1996
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or
[ ] Transition Report Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 [No Fee Required]
For the transition period from to
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Commission File Number: 1-10792
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PUBLIC STORAGE PROPERTIES XIV, INC.
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(Exact name of registrant as specified in its charter)
California 95-4300884
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification Number)
701 Western Avenue
Glendale, California 91201-2397
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code: (818) 244-8080
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Securities registered pursuant to Section 12(b) of the Act:
Name of each exchange
Title of each class on which registered
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Common Stock Series A, American Stock Exchange
$.01 par value
Securities registered pursuant to Section 12(g) of the Act:
None
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(Title of class)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15(d) of the
Securities Exchange Act of 1934 during the preceding 12 months
(or for such shorter period that the registrant was required to
file such reports), and (2) has been subject to such filing
requirements for the past 90 days. [ X ] Yes [ ] No
Item 10. Directors and Executive Officers of the Company.
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Public Storage Properties XIV, Inc. (the "Company") was formed
in November 1990 for the purpose of succeeding to the business of Public
Storage Properties XIV, Ltd. (the "Partnership") in a reorganization
transaction (the "Reorganization"). The Partnership's general partners
(the "General Partners") were PSI Associates II, Inc. and B. Wayne Hughes.
The Reorganization was effective on June 3, 1991 and subsequently, the
Partnership was dissolved. The Company has elected to be taxed as a real
estate investment trust ("REIT") for federal income tax purposes.
In 1995, there were a series of mergers among Public Storage
Management, Inc. (which was the Company's mini-warehouse property
operator) ("PSMI"), Public Storage, Inc. and their affiliates, culminating
in the November 16, 1995 merger (the "PSMI Merger") of PSMI into Storage
Equities, Inc. As a result of the PSMI Merger, Storage Equities, Inc. was
renamed Public Storage, Inc. ("PSI") and PSI acquired substantially all of
the United States real estate operations of PSMI and became the operator
of the Company's mini-warehouse properties.
Set forth below is information regarding the directors and
executive officers of the Company:
Name Positions
B. Wayne Hughes Chairman of the Board and Chief Executive
Officer
Harvey Lenkin President
David P. Singelyn Vice President and Chief Financial Officer
David Goldberg Vice President and General Counsel
A. Timothy Scott Vice President and Tax Counsel
Obren B. Gerich Vice President and Secretary
Hugh W. Horne Vice President
Vern O. Curtis Director
Jack D. Steele Director
B. Wayne Hughes, age 63, has been Chairman of the Board and
Chief Executive Officer of the Company since its inception in 1990. Mr.
Hughes has been Chairman of the Board and Chief Executive Officer since
1990 of Public Storage Properties XI, Inc., Public Storage Properties XV,
Inc., Public Storage Properties XVI, Inc., Public Storage Properties XVII,
Inc., Public Storage Properties XVIII, Inc., Public Storage Properties
XIX, Inc. and Public Storage Properties XX, Inc. (collectively, the
"Public Storage REITs"), real estate investment trusts organized by an
affiliate of PSMI. He has been a director of PSI, the Company's mini-
warehouse property operator, since its organization in 1980 and was
President and Co-Chief Executive Officer from 1980 until November 1991
when he became Chairman of the Board and sole Chief Executive Officer.
Mr. Hughes was an officer and director of affiliates of PSMI and a
director of PSMI until November 1995. From 1989-90 until the respective
dates of merger, he was Chairman of the Board and Chief Executive Officer
of Public Storage Properties VI, Inc., Public Storage Properties VII,
Inc., Public Storage Properties VIII, Inc., Public Storage Properties IX,
Inc. ("PSP9"), Public Storage Properties X, Inc. ("PSP10"), Public Storage
Properties XII, Inc. ("PSP12"), PS Business Parks, Inc. ("PSBP"), Partners
Preferred Yield, Inc. ("PPY"), Partners Preferred Yield II, Inc. ("PPY2"),
Partners Preferred Yield III, Inc. ("PPY3") and Storage Properties, Inc.
("SPI") (collectively, the "Merged Public Storage REITs"), affiliated
REITs that were merged into PSI between September 1994 and December 1996.
He has been active in the real estate investment field for over 25 years.
Harvey Lenkin, age 60, has been President of the Company since
its inception in 1990. He has been President of the Public Storage REITs
since 1990. Mr. Lenkin became President and a director of PSI in November
1991. He was an officer and director of PSMI and its affiliates until
November 1995. Mr. Lenkin was President of the Merged Public Storage
REITs from 1989-90 until the respective dates of merger and was also a
director of SPI from 1989 until June 1996.
David P. Singelyn, age 35, a certified public accountant, was
Controller of the Company from November 1995 until December 1996 when he
became Vice President and Chief Financial Officer. Mr. Singelyn was
Controller of the Public Storage REITs from November 1995 until December
1996 when he became Vice President and Chief Financial Officer. In
November 1995, he became Vice President and Treasurer of PSI. Mr.
Singelyn was employed by affiliates of PSMI from 1989 until November 1995.
He was Vice President and Controller of SPI from 1991 until June 1996.
From 1987 to 1989, Mr. Singelyn was Controller of Winchell's Donut Houses,
L.P.
David Goldberg, age 47, became Vice President and General
Counsel of the Company in December 1995. Mr. Goldberg became Senior Vice
President and General Counsel of PSI in November 1995 and Vice President
and General Counsel of the Public Storage REITs in December 1995. He
joined PSMI's legal staff in June 1991, rendering services on behalf of
PSI, PSMI, the Company and the Public Storage REITs. From December 1982
until May 1991, he was a partner in the law firm of Sachs & Phelps, then
counsel to PSI and PSMI.
A. Timothy Scott, age 45, became Vice President and Tax Counsel
of the Company in November 1996. Mr. Scott became Senior Vice President
and Tax Counsel of PSI and Vice President and Tax Counsel of the Public
Storage REITs in November 1996. From June 1991 until joining PSI, he
practiced tax law as a shareholder of the law firm of Heller, Ehrman,
White & McAuliffe, counsel to PSI and PSMI. Prior to June 1991, his
professional corporation was a partner in the law firm of Sachs & Phelps,
then counsel to PSI and PSMI.
Obren B. Gerich, age 58, a certified public accountant, has been
Vice President and Secretary of the Company since its inception in 1990
and was Chief Financial Officer until November 1995. Mr. Gerich has been
Vice President and Secretary of the Public Storage REITs since 1990 and
was Chief Financial Officer until November 1995. He has been a Vice
President of PSI since 1980, became Senior Vice President of PSI in
November 1995 and was Chief Financial Officer of PSI until November 1991.
Mr. Gerich was an officer and director of PSMI and its affiliates until
November 1995. He was Vice President and Secretary of the Merged Public
Storage REITs from 1989-90 until the respective dates of merger.
Hugh W. Horne, age 52, has been a Vice President of the Company
and of the Public Storage REITs since June 1993. Mr. Horne has been a
Vice President of PSI since 1980 and was Secretary of PSI from 1980 until
February 1992 and became Senior Vice President of PSI in November 1995.
He is responsible for managing all aspects of property acquisition for
PSI. Mr. Horne was an officer and director of affiliates of PSMI and an
officer of PSMI until November 1995. He was a Vice President of SPI from
1989 until June 1996 and of the other Merged Public Storage REITs from
June 1993 until the respective dates of merger.
Vern O. Curtis, age 62, Chairman of the Audit Committee, is a
private investor. Mr. Curtis has been a director of the Company since its
inception in 1990. Mr. Curtis has also been a director of the Public
Storage REITs since 1990. Mr. Curtis is also a director of the Pimco
Funds, Pimco Commercial Mortgage Securities Trust, Inc. and Fresh Choice,
Inc. He was a director of the Merged Public Storage REITs from 1989-90
until the respective dates of merger. Mr. Curtis was Dean of Business
School of Chapman College from 1988 to 1990 and President and Chief
Executive Officer of Denny's, Inc. from 1980 to 1987.
Jack D. Steele, age 73, a member of the Audit Committee, has
been a director of the Company since its inception in 1990. Mr. Steele
has also been a director of the Public Storage REITs since 1990. He is
also a director of Rohr, Inc. Mr. Steele is a business consultant. He
was a director of the Merged Public Storage REITs from 1989-90 until the
respective dates of merger. Mr. Steele was Chairman - Board Services of
Korn/Ferry International from 1986 to 1988 and Dean of School of Business
and Professor at the University of Southern California from 1975 to 1986.
Item 11. Executive Compensation.
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Compensation of Directors
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Each of the Company's directors, other than B. Wayne Hughes,
receives director's fees of $2,000 per year plus $200 for each meeting
attended. In addition, each of the members of the Audit Committee
receives $100 for each meeting of the Audit Committee attended. The
policy of the Company is to reimburse directors for reasonable expenses.
Compensation of Executive Officers
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Set forth below is certain compensation relating to B. Wayne
Hughes, the Company's Chief Executive Officer. The Company has no
executive officer who earned $100,000 or more in 1996 for services
rendered to the Company.
Summary Compensation Table
Annual Compensation
Name and Principal Position Year Salary
B. Wayne Hughes 1996 $1,000
Chairman of the Board and 1995 1,000
Chief Executive Officer 1994 1,000
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
The Company does not have a compensation committee. Mr. Hughes,
the Chief Executive Officer of the Company, is a member of the Board of
Directors. Mr. Hughes is a director and the chief executive officer of
the seven Public Storage REITs (and during all or part of 1996, Mr. Hughes
was a director and the chief executive officer of PSP9, PSP10, PSP12,
PSBP, PPY, PPY2 and PPY3). Mr. Hughes also is the chief executive officer
and a director of PSI, of which Harvey Lenkin, President of the Company,
is the president and a director (and until June 1996, Mr. Hughes was also
a director and the chief executive officer of SPI, of which Mr. Lenkin was
the president and a director). Neither PSI nor any of the seven Public
Storage REITs has (nor did PSP9, PSP10, PSP12, PSBP, PPY, PPY2, PPY3 or
SPI have) a compensation committee.
Certain Relationships and Related Transactions
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Management Agreements. The Company has a Management Agreement
with PSI pursuant to which the Company pays PSI a fee of 6% of the gross
revenues of the mini-warehouse spaces operated for the Company. During
1996, the Company paid or accrued fees of $148,000 to PSI pursuant to the
Management Agreement, exclusive of the prepayment made by the Company to
PSI in November 1995 of eight months of 1996 management fees at a cost of
$248,000.
Through 1996, the Company's commercial properties were managed
by Public Storage Commercial Properties Group, Inc. ("PSCP") pursuant to a
Management Agreement which provides for the payment of a fee by the
Company of 5% of the gross revenues of the commercial space operated for
the Company. During 1996, the Company paid or accrued $79,000 to PSCP
pursuant to the Management Agreement. PSI has a 95% economic interest in
PSCP (represented by nonvoting preferred stock) and B. Wayne Hughes and
members of his family (the "Hughes Family") had a 5% economic interest in
PSCP (represented by voting common stock) until December 1996, when the
Hughes Family sold its interest to Ronald L. Havner, Jr., formerly Senior
Vice President and Chief Financial Officer of PSI, who became the Chief
Executive Officer of PSCP. PSCP issued additional voting common stock to
two other unaffiliated investors. In January 1997, American Office Park
Properties, L.P. ("AOPPLP") became the manager of the Company's commercial
properties pursuant to the Management Agreement. AOPPLP is an operating
partnership formed to own and operate business parks in which PSI has an
approximate 85% economic interest. The general partner of AOPPLP is PSCP,
now known as American Office Park Properties, Inc.
Each Management Agreement, as amended in February 1995, provides
that the Management Agreement will expire in February 2002 provided that
in February of each year it shall be automatically extended for one year
(thereby maintaining a seven-year term) unless either party notifies the
other that the Management Agreement is not being extended, in which case
it expires, on the first anniversary of its then scheduled expiration
date. Each Management Agreement may also be terminated by either party
for cause.
Proposed Merger. In December 1996, the Company and PSI agreed,
subject to certain conditions, to merge. Upon the merger, each
outstanding share of the Company's Common Stock Series A (other than
shares held by PSI or by holders of the Company's Common Stock Series A
("Series A Shareholders") who have properly exercised dissenters' rights
under California law ("Dissenting Shares")) will be converted into the
right to receive cash, PSI common stock or a combination of the two, as
follows: (i) with respect to a certain number of shares of the Company's
Common Stock Series A (not to exceed 20% of the outstanding Common Stock
Series A of the Company, less any Dissenting Shares), upon a Series A
Shareholder's election, $21.73 in cash, subject to reduction as described
below or (ii) that number (subject to rounding) of shares of PSI common
stock determined by dividing $21.73, subject to reduction as described
below, by the average of the per share closing prices on the New York
Stock Exchange of PSI common stock during the 20 consecutive trading days
ending on the fifth trading day prior to the special meeting of the
Company's shareholders. The consideration paid by PSI to the Series A
Shareholders in the merger will be reduced by the amount of cash
distributions required to be paid to the Series A Shareholders by the
Company prior to completion of the merger (estimated at $1.18 per share)
in order to satisfy the Company's REIT distribution requirements
("Required REIT Distributions"). The consideration received by the Series
A Shareholders in the merger, however, along with any Required REIT
Distributions, will not be less than $21.73 per share of the Company's
Common Stock Series A, which amount represents the interest of the
Series A Shareholders in the market value of the Company's real estate
assets at October 31, 1996 (based on an independent appraisal) and the
interest of the Series A Shareholders in the estimated net asset value of
its other assets at March 31, 1997. Additional distributions will be made
to the Series A Shareholders to cause the Company's estimated net asset
value allocable to the Series A Shareholders as of the date of the merger
to be substantially equivalent to $21.73 per share. Upon the merger, each
share of the Company's Common Stock Series B and Common Stock Series C
(other than shares held by PSI) would be converted into the right to
receive $16.07 in PSI common stock (valued as in the case of the Company's
Common Stock Series A) plus (i) any additional distributions equal to the
amount by which the Company's estimated net asset value allocable to the
holders of the Company's Common Stock Series B and C as of the date of the
merger exceeds $16.07 per share and (ii) the estimated Required REIT
Distributions payable to the holders of the Company's Common Stock
Series B of $1.18 per share. The common stock of the Company held by PSI
will be canceled in the merger. The merger is conditioned on, among other
requirements, approval by the Company's shareholders. It is expected that
the merger will close in April 1997. PSI owns 33.3% of the total combined
shares of the Company's Common Stock Series A, B and C (the "Total Company
Common Stock"). The Company's executive officers and directors own 1.1%
of the Total Company Common Stock and members of B. Wayne Hughes' family
own an additional 0.6% of the Total Company Common Stock.
Item 12. Security Ownership of Certain Beneficial Owners and Management.
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Security Ownership of Certain Beneficial Owners
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The following table sets forth information with respect to the
only person known to the Company to be the beneficial owner of more than
5% of the Company's outstanding shares of Common Stock Series A, Common
Stock Series B and Common Stock Series C (the "Common Stock") (or Common
Stock Series A):
Shares of Common Stock,
$.01 Par Value,
Beneficially Owned as of
March 31, 1997(1)
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Number
Name and Address of Shares(2)(3) Percent
PSI A: 208,568(4) A: 9.2%
701 Western Avenue, Suite 200 B: 218,616(4) B: 93.9%
Glendale, California 91201-2397 C: 623,058(4) C: 94.5%
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1,050,242(4)(5) 33.3%
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(Footnotes to the table are set forth following the table under "Security
Ownership of Management" below).
Security Ownership of Management
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The following table sets forth information concerning the
security ownership of each director of the Company (including B. Wayne
Hughes, the only executive officer named under Item 11) and of all
directors and executive officers of the Company as a group:
Shares of Common Stock,
$.01 Par Value,
Beneficially Owned as of
March 31, 1997(1)
---------------------------------
Number
Name of Shares(2)(3) Percent
B. Wayne Hughes A: 13,635(6) A: 0.6%
Vern O. Curtis A: 500 (7)
Jack D. Steele A: 100(8) (7)
All Directors and Executive A: 15,035(6)(8)(9) A: 0.7%
Officers as a Group B: 6,430 B: 2.8%
(nine persons) C: 14,574 C: 2.2%
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36,039(5)(6)(8)(9) 1.1%
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(1) Except as otherwise indicated and subject to applicable community
property and similar statutes, the persons listed as beneficial owners
of the shares have sole voting and investment power with respect to
the shares.
(2) Capital letters "A", "B" and "C" denote share information with respect
to Common Stock Series A, Common Stock Series B and Common Stock
Series C, respectively.
(3) The Company's Articles of Incorporation provide that the Common Stock
Series B and Common Stock Series C will convert automatically into
Common Stock Series A on a share-for-share basis when (A) the sum of
(1) all cumulative dividends and other distributions from all sources
paid with respect to the Common Stock Series A (including liquidating
distributions, but not including payments made to redeem such stock
other than in liquidation) and (2) the cumulative Partnership
distributions from all sources with respect to all Partnership units
(including the General Partners' 1% interest) equals (B) the product
of $20 multiplied by the number of then outstanding "Original Series A
Shares." The term "Original Series A Shares" means the shares of
Common Stock Series A issued in the Reorganization.
(4) Includes (i) 208,033 shares of Common Stock Series A, 218,616 shares
of Common Stock Series B and 623,058 shares of Common Stock Series C
owned by PSI as to which PSI has sole voting and dispositive power and
(ii) 535 shares of Common Stock Series A which PSI has an option to
acquire (together with other securities) from B. Wayne Hughes as
trustee of the B.W. Hughes Living Trust and as to which PSI has sole
voting power (pursuant to an irrevocable proxy) and no dispositive
power.
(5) Includes Common Stock Series A, Common Stock Series B and Common Stock
Series C.
(6) Includes (i) 535 shares of Common Stock Series A owned by B. Wayne
Hughes as trustee of the B.W. Hughes Living Trust as to which Mr.
Hughes has sole dispositive power and no voting power; PSI has an
option to acquire these shares and an irrevocable proxy to vote these
shares (see footnote (4) above), and (ii) 13,100 shares of Common
Stock Series A owned by Mrs. Kathleen Becker Hughes (Hughes' wife) as
trustee FBO Parker Hughes Trust dtd 3/7/91.
(7) Less than 0.1%.
(8) Shares held by a bank custodian of a simplified employee pension for
the benefit of Mr. Steele.
(9) Includes shares held of record or beneficially by members of the
immediate family of officers of the Company and shares held by
custodians of individual retirement accounts for the benefit of
officers of the Company (or members of their immediate families).
Item 13. Certain Relationships and Related Transactions.
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See "Compensation Committee Interlocks and Insider
Participation -- Certain Relationships and Related Transactions" under
Item 11.
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of
1934, the Registrant has duly caused this amendment to be signed on its
behalf by the undersigned, thereunto duly authorized.
PUBLIC STORAGE PROPERTIES XIV, INC.
(Registrant)
Dated: April 4, 1997 By: /s/OBREN B. GERICH
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Name: Obren B. Gerich
Title: Vice President
