SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-A
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR 12(g) OF THE
SECURITIES EXCHANGE ACT OF 1934
Kranzco Realty Trust
(Exact name of registrant as specified in its charter)
Maryland 23-2691327
(State of incorporation or organization) (I.R.S. Employer
Identification No.)
128 Fayette Street, Conshohocken, PA 19428
(Address of principal executive offices) (Zip Code)
If this form relates to the If this relates to the
registration of a class of registration of a class of
securities pursuant to Section securities pursuant to Section
12(b) of the Exchange Act and 12(g) of the Exchange Act and
is effective pursuant to is effective pursuant to
General Instruction A.(c), General Instruction A.(d),
please check the following please check the following
box. ____ box.____
/___/ /___/
Securities Act registration statement file number to which this
form relates:
(If applicable)
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(b) OF THE ACT:
Series D Cumulative Redeemable Preferred Shares of
Beneficial Interest
(Title of each class to be registered)
New York Stock Exchange
(Name of each exchange
on which each class is
to be registered)
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(g) OF THE ACT:
NONE.
ITEM 1. Description of Registrant's Securities to be
Registered. The description of the Registrant's
securities to be registered is incorporated herein by
reference to the information contained in Registrant's
Prospectus Supplement under the heading "Description of
Series D Preferred Shares," such Prospectus Supplement
to be subsequently filed pursuant to Rule 424 of the
Securities Act.
ITEM 2. Exhibits
3.1 - Amended and Restated Declaration of Trust of
Registrant.*
3.2 - Amendment No. 1 to Amended and Restated
Declaration of Trust of Registrant.**
3.3 - Amendment No. 2 to Amended and Restated
Declaration of Trust of Registrant.***
3.4 - Amended and Restated Bylaws of Registrant, as
amended.*
3.5 - Articles Supplementary classifying 2,070,000
Series D Cumulative Redeemable Preferred Shares
of Beneficial Interest ("Series D Preferred
Shares").
4.1 - Specimen of Registrant's Series D Preferred
Shares certificate.
________________________
* Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-11 (Registration No. 33-
49434) and incorporated herein by reference.
** Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-8 (Registration No. 33-
94294) and incorporated herein by reference.
*** Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-3 (Registration No.
333-32597) and incorporated by reference herein.
<PAGE>
SIGNATURE
Pursuant to the requirements of Section 12 of the Securities
and Exchange Act of 1934, the Registrant has duly caused this
Registration Statement to be signed on its behalf by the
undersigned, thereto duly authorized.
December 10, 1997
KRANZCO REALTY TRUST
By: /s/ Robert H. Dennis
--------------------
Robert H. Dennis
Vice President and
Chief Financial Officer
<PAGE>
EXHIBIT INDEX
3.1 - Amended and Restated Declaration of Trust of
Registrant.*
3.2 - Amendment No. 1 to Amended and Restated
Declaration of Trust of Registrant.**
3.3 - Amendment No. 2 to Amended and Restated
Declaration of Trust of Registrant.***
3.4 - Amended and Restated Bylaws of Registrant, as
amended.*
3.5 - Articles Supplementary classifying 2,070,000
Series D Cumulative Redeemable Preferred Shares
of Beneficial Interest ("Series D Preferred
Shares").
4.1 - Specimen of Registrant's Series D Preferred
Shares certificate.
________________________
* Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-11 (Registration No. 33-
49434) and incorporated herein by reference.
** Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-8 (Registration No. 33-
94294) and incorporated herein by reference.
*** Previously filed as an exhibit to the Registrant's
Registration Statement on Form S-3 (Registration No.
333-32597) and incorporated by reference herein.
KRANZCO REALTY TRUST
KRANZCO REALTY TRUSTARTICLES SUPPLEMENTARY
CLASSIFYING
2,070,000 SHARES OF
BENEFICIAL INTEREST AS
SERIES D CUMULATIVE REDEEMABLE
PREFERRED SHARES OF BENEFICIAL INTEREST
(Pursuant to Section 8-203(b) of the
Corporations and Associations Article
of the Annotated Code of Maryland)
Kranzco Realty Trust, a real estate investment trust
organized and existing under the laws of the State of Maryland
(the "Company"), and having its executive office at 128 Fayette
Street, Conshohocken, Pennsylvania 19428, hereby certifies to the
State Department of Assessments and Taxation of Maryland that:
FIRST: Pursuant to the authority granted to and vested
in the Board of Trustees of the Company (the "Board of Trustees")
in accordance with the Amended and Restated Declaration of Trust
of the Company, dated November 4, 1992, as amended (the
"Declaration of Trust"), the Board of Trustees by unanimous
written consent dated November 19, 1997, adopted resolutions
authorizing and establishing a separate class of preferred shares
of beneficial interest, out of the 100,000,000 authorized shares
of beneficial interest of the Company (the "Shares"), consisting
of 2,070,000 shares to be known as the "Series D Cumulative
Redeemable Preferred Shares of Beneficial Interest" (the "Series
D Preferred Shares"). Such Series D Preferred Shares shall have
a par value of $.01 per share. The preferences and other rights,
voting powers, restrictions, limitations as to distributions,
qualifications, and terms and conditions of redemption of such
shares, which shall be deemed to be part of Article VI of the
Declaration of Trust, are as follows:
A. Certain Definitions.
Unless the context otherwise requires, the terms defined in
this paragraph (A) shall have, for all purposes of the provisions
of the Declaration of Trust in respect of the Series D Preferred
Shares, the meanings herein specified (with terms defined in the
singular having comparable meanings when used in the plural).
Business Day. The term "Business Day" shall mean any day,
other than a Saturday or Sunday, that is neither a legal holiday
nor a day on which banking institutions in New York City are
authorized or required by law, regulation or executive order to
close.
Capital Shares. The term "Capital Shares" shall mean, with
respect to any Person, any common shares of beneficial interest,
preferred shares, depositary shares, interests, participation 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.
Code. The term "Code" shall mean the Internal Revenue Code
of 1986, as amended from time to time.
Common Equity. The term "Common Equity" shall mean all
shares now or hereafter authorized of any class of common shares
of beneficial interest of the Company, including the Common
Shares, and any other shares of beneficial interest of the
Company, howsoever designated, which has the right (subject
always to prior rights of any class or series of preferred shares
of beneficial interest) to participate in the distribution of the
assets and earnings of the Company without limit as to per share
amount.
Common Shares. The term "Common Shares" shall mean the
Common Shares of Beneficial Interest, $.01 par value per share,
of the Company.
Distribution Payment Date. The term "Distribution Payment
Date" shall have the meaning set forth in subparagraph (2) of
paragraph (B) below.
Distribution Period. The term "Distribution Period" shall
mean the period from, and including, the Initial Issue Date to,
but not including, the first Distribution Payment Date and
thereafter, each quarterly period from, and including, the
Distribution Payment Date to, but not including, the next
Distribution Payment Date.
Distribution Record Date. The term "Distribution Record
Date" shall mean the date designated by the Board of Trustees of
the Company at the time a distribution is declared, provided,
however, that such Distribution Record Date shall be not more
than 60 days nor less than ten days prior to such Distribution
Payment Date.
Junior Shares. The term "Junior Shares" shall mean, as the
case may be, (i) the Common Equity and any other class or series
of shares of beneficial interest of the Company which is not
entitled to receive any distributions in any Distribution Period
unless all distributions required to have been paid or declared
and set apart for payment on the Series D Preferred Shares shall
have been so paid or declared and set apart for payment and (ii)
the Common Equity and any other class or series of shares of
beneficial interest of the Company which is not entitled to
receive any assets upon liquidation, dissolution or winding up of
the affairs of the Company until the Series D Preferred Shares
shall have received the entire amount to which such Class D
Preferred Shares are entitled upon such liquidation, dissolution
or winding up.
Liquidation Preference. The term "Liquidation Preference"
shall mean $25.00 per share.
Original Issue Date. The term "Original Issue Date" shall
mean the date that Series D Preferred Shares are first issued by
the Company.
Parity Shares. The term "Parity Shares" shall mean, as the
case may be, (i) any class or series of shares of beneficial
interest of the Company which is entitled to receive payment of
distributions on a parity with the Series D Preferred Shares,
(ii) any class or series of shares of beneficial interest of the
Company which is entitled to receive assets upon liquidation,
dissolution or winding up of the affairs of the Company on a
parity with the Series D Preferred Shares, and (iii) the Series
A-1 Preferred Shares, the Series B-1 Preferred Shares, the Series
B-2 Preferred Shares, and the Series C Preferred Shares.
Person. The term "Person" shall mean an individual,
corporation, partnership, estate, trust (including a trust
classified under Section 401(a) or 501(c)(17) of the Code), a
portion of a trust permanently set aside for or to be used
exclusively for the purposes described in Section 642(c) of the
Code, association, private foundation within the meaning of
Section 509(a) of the Code, joint stock company or other entity,
and also includes a group as that term is used for purposes of
Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended, and a group to which an Excepted Holder Limit (as
defined in paragraph (F) below) applies, but does not include an
underwriter which participates in a public offering of the Series
D Preferred Shares, provided that such ownership by such
underwriter would not result in the Company being "closely held"
within the meaning of Section 856(h) of the Code, or otherwise
result in the Company failing to qualify as a REIT.
Preferential Distribution Non-Payment. The term
"Preferential Distribution Non-Payment" shall have the meaning
set forth in subparagraph (2) of paragraph (E) below.
Preferred Shares Trustee. The term "Preferred Shares
Trustee" shall have the meaning set forth in subparagraph (2) of
paragraph (E) below.
Redemption Date. The term "Redemption Date" shall have the
meaning set forth in subparagraph (2) of paragraph (D) below.
Redemption Price. The term "Redemption Price" shall mean a
price per Series D Preferred Share equal to $25.00 together with
accrued and unpaid distributions, if any, thereon to the
Redemption Date, without interest.
Redemption Record Date. The term "Redemption Record Date"
shall mean the date designated by the Board of Trustees of the
Company for redemption of Series D Preferred Shares, provided,
however, that such Redemption Record Date shall be not more than
60 days nor less than 30 days prior to such Redemption Date.
REIT. The term "REIT" shall mean a real estate investment
trust under Section 856 of the Code.
Senior Shares. The term "Senior Shares" shall mean, as the
case may be, (i) any class or series of shares of beneficial
interest of the Company ranking senior to the Series D Preferred
Shares in respect of the right to receive distributions or (ii)
any class or series of shares of beneficial interest of the
Company ranking senior to the Series D Preferred Shares in
respect of the right to participate in any distribution upon
liquidation, dissolution or winding up of the affairs of the
Company.
Series A-1 Preferred Shares. The term "Series A-1 Preferred
Shares" shall mean the Series A-1 Increasing Rate Cumulative
Convertible Preferred Shares of Beneficial Interest, par value
$.01 per share, of the Company.
Series B-1 Preferred Shares. The term "Series B-1 Preferred
Shares" shall mean the Series B-1 Cumulative Convertible
Preferred Shares of Beneficial Interest, par value $.01 per
share, of the Company.
Series B-2 Preferred Shares. The term "Series B-2 Preferred
Shares" shall mean the Series B-2 Cumulative Convertible
Preferred Shares of Beneficial Interest, par value $.01 per
share, of the Company.
Series C Preferred Shares. The term "Series C Preferred
Shares" shall mean the Series C Cumulative Redeemable Preferred
Shares of Beneficial Interest, par value $.01 per share, of the
Company.
B. Distributions.
1. The record holders of Series D Preferred Shares shall
be entitled to receive cash distributions, when, as and if
authorized and declared by the Board of Trustees, out of assets
legally available for payment of distributions. Such
distributions shall be payable quarterly by the Company in cash
at a rate of 9 1/2% of the Liquidation Preference per annum
(equivalent to $2.375 per Series D Preferred Share per annum).
2. Distributions on Series D Preferred Shares shall accrue
and be cumulative from the Original Issue Date. Distributions
shall be payable quarterly in arrears when, as and if authorized
by the Board of Trustees of the Company on the 20th day of
January, April, July, and October of each year (each, a
"Distribution Payment Date"), commencing on the Business Day
succeeding January 20, 1998. If any Distribution Payment Date
occurs on a day that is not a Business Day, any accrued
distributions otherwise payable on such Distribution Payment Date
shall be paid on the next succeeding Business Day. The amount of
distributions payable on Series D Preferred Shares for each full
Distribution Period shall be computed by dividing by four the
annual distribution rate set forth in subparagraph (1) of this
paragraph (B) above. Distributions payable in respect of any
Distribution Period which is less than a full Distribution Period
in length will be computed on the basis of a 360-day year
consisting of twelve 30-day months. Distributions shall be paid
to the holders of record of the Series D Preferred Shares as
their names shall appear on the share records of the Company at
the close of business on the Distribution Record Date for such
distribution. Distributions in respect of any past Distribution
Periods that are in arrears may be declared and paid at any time
to holders of record on the Distribution Record Date therefor.
Any distribution payment made on Series D Preferred Shares shall
be first credited against the earliest accrued but unpaid
distribution due which remains payable. The Series D Preferred
Shares rank pari passu to the Series A-1 Preferred Shares, the
Series B-1 Preferred Shares, the Series B-2 Preferred Shares and
the Series C Preferred Shares as to distributions.
3. If any Series D Preferred Shares are outstanding, no
distributions shall be authorized or paid or set apart for
payment on any other class or series of Junior Shares or Parity
Shares for any period unless full cumulative distributions have
been or contemporaneously are authorized and paid or authorized
and a sum sufficient for the payment thereof set apart for such
payment on the Series D Preferred Shares for all past
Distribution Periods and the then current Distribution Period.
When distributions are not paid in full (or a sum sufficient for
such full payment is not so set apart) upon the Series D
Preferred Shares and any other class or series of Preferred
Shares ranking on a parity as to distributions with the Series D
Preferred Shares, all distributions authorized upon the Series D
Preferred Shares and any other such class or series of Preferred
Shares shall be authorized pro rata so that the amount of
distributions authorized per share on the Series D Preferred
Shares and such class or series of such Shares shall in all cases
bear to each other the same ratio that accrued and unpaid
distributions per share on the Series D Preferred Shares and such
class or series of Shares bear to each other. No interest, or
sum of money in lieu of interest, shall be payable in respect of
any distribution payment or payments on the Series D Preferred
Shares which may be in arrears.
4. Except as provided in subparagraph (3) of this para-
graph (B), unless full cumulative distributions on the Series D
Preferred Shares have been or contemporaneously are authorized
and paid or authorized and a sum sufficient for the payment
thereof set apart for payment for all past Distribution Periods
and the then current Distribution Period, no distributions (other
than in Junior Shares) shall be authorized or paid or set apart
for payment or other distribution shall be authorized or made
upon any Junior Shares or Parity Shares nor shall any Junior
Shares or Parity Shares 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
other Junior Shares).
5. Notwithstanding anything contained herein to the con-
trary, no distributions on Series D Preferred Shares shall be
authorized by the Board of Trustees of the Company or paid or set
apart for payment by the Company at such time as the terms and
provisions of any agreement of the Company, including any
agreement relating to its indebtedness, prohibits such authori-
zation, payment or setting apart for payment or provides that
such authorization, payment or setting apart for payment would
constitute a breach thereof or a default thereunder, or to the
extent such authorization, payment or setting apart for payment
shall be restricted or prohibited by law.
6. Notwithstanding anything contained herein to the con-
trary, distributions on the Series D Preferred Shares, if not
paid on the applicable Distribution Payment Date, will accrue
whether or not any agreement of the Company prohibits payment of
such distributions, whether or not distributions are authorized
for such Distribution Payment Date, whether or not the Company
has earnings and whether or not there are assets legally
available for the payment of such distributions.
7. If, for any taxable year, the Board of Trustees elects
to designate as "capital gain dividends" (as defined in Section
857 of the Code) any portion (the "Capital Gains Amount") of the
distributions paid for the year to holders of all classes of
shares of beneficial interest of the Company (the "Total
Distributions"), then the portion of the Capital Gains Amount
that shall be allocable to holders of the Series D Preferred
Shares shall be the Capital Gains Amount multiplied by a
fraction, the numerator of which shall be the total distributions
paid to the holders of the Series D Preferred Shares for the year
and the denominator of which shall be the Total Distributions.
C. Distributions Upon Liquidation, Dissolution or Winding Up.
1. Upon any voluntary or involuntary liquidation,
dissolution or winding up of the affairs of the Company, subject
to the prior preferences and other rights of any Senior Shares as
to liquidation preferences, but before any distribution or
payment shall be made to the holders of any Junior Shares as to
the distribution of assets upon any liquidation, dissolution or
winding up of the affairs of the Company, the holders of Series D
Preferred Shares shall be entitled to receive out of the assets
of the Company legally available for distribution to its
shareholders liquidating distributions in cash or property at its
fair market value as determined by the Board of Trustees in the
amount of the Liquidation Preference per share plus an amount
equal to all distributions accrued and unpaid thereon (whether or
not declared) to the date of such liquidation, dissolution or
winding up. After payment of the full amount of the liquidating
distributions to which they are entitled, the holders of Series D
Preferred Shares will have no right or claim to any of the
remaining assets of the Company and shall not be entitled to any
other distribution in the event of liquidation, dissolution or
winding up of the affairs of the Company.
2. In the event that, upon any such voluntary or
involuntary liquidation, dissolution or winding up, the legally
available assets of the Company are insufficient to pay the
amount of the Liquidation Preference per share plus an amount
equal to all distributions accrued and unpaid on the Series D
Preferred Shares and the corresponding amounts payable on all
shares of Parity Shares as to the distribution of assets upon
liquidation, dissolution or winding up, then the holders of the
Series D Preferred Shares and all such Parity Shares shall share
ratably in any such distribution of assets in proportion to the
full liquidating distributions to which they otherwise would be
respectively entitled. The Series D Preferred Shares rank pari
passu to the Series A-1 Preferred Shares, the Series B-1
Preferred Shares, the Series B-2 Preferred Shares and the Series
C Preferred Shares as to the distribution of assets upon any
liquidation, dissolution or winding up of the affairs of the
Company. Neither the consolidation or merger of the Company into
or with another entity nor the dissolution, liquidation, winding
up or reorganization of the Company immediately followed by
incorporation of another corporation to which such assets are
distributed, nor the sale, lease, transfer or conveyance of all
or substantially all of the assets of the Company to another
entity shall be deemed a liquidation, dissolution or winding up
of the affairs of the Company within the meaning of this
paragraph (C); provided that, in each case, effective provision
is made in the charter of the resulting or surviving entity or
otherwise for the recognition, preservation and protection of the
rights of the holders of the Series D Preferred Shares.
D. Redemption by the Company.
1. The Series D Preferred Shares may be redeemed for cash,
in whole or from time to time in part, on any date on or after
December 11, 2002 as fixed by the Board of Trustees of the
Company at the Redemption Price. The Redemption Price of the
Series D Preferred Shares (other than any portion thereof
consisting of accrued and unpaid dividends) shall be paid solely
from the sale proceeds of other Capital Shares of the Company and
not from any other source.
2. Each date fixed for redemption pursuant to subparagraph
(1) of this paragraph (D) is called a "Redemption Date". If the
Redemption Date is after a Distribution Record Date and before
the related Distribution Payment Date, the distribution payable
on such Distribution Payment Date shall be paid to the holder in
whose name the Series D Preferred Shares to be redeemed are
registered at the close of business on such Distribution Record
Date notwithstanding the redemption thereof between such
Distribution Record Date and the related Distribution Payment
Date or the Company's default in the payment of the distribution.
3. In case of redemption of less than all of the Series D
Preferred Shares at the time outstanding, the shares to be
redeemed shall be selected by the Company pro rata from the
holders of record of such shares in proportion to the number of
shares held by such holders (with adjustments to avoid redemption
of fractional shares) or by any other equitable method determined
by the Board of Trustees.
In order to facilitate the redemption of Series D Preferred
Shares, the Board of Trustees may fix a record date for the
determination of the shares to be redeemed, such record date to
be not less than 30 nor more than 60 days prior to the date fixed
for such redemption.
4. Notice of any redemption will be given by publication
in a newspaper of general circulation in The City of New York,
such publication to be made once a week for two successive weeks
commencing not less than 30 nor more than 60 days prior to the
Redemption Date. A similar notice will be mailed by the Company,
postage prepaid, not less than 30 nor more than 60 days prior to
the Redemption Date, addressed to the respective holders of
record of the Series D Preferred Shares to be redeemed at their
respective addressees as they appear on the share transfer
records of the Company. No failure to give such notice or any
defect therein or in the mailing thereof shall affect the
validity of the proceedings for the redemption of any Series D
Preferred Shares except as to any holder to whom the Company has
failed to give notice or except as to any holder to whom notice
was defective. In addition to any information required by law or
by the applicable rules of any exchange upon which Series D
Preferred Shares may be listed or admitted to trading, such
notice shall state: (i) the Redemption Date; (ii) the Redemption
Price; (iii) the number of Series D Preferred Shares to be
redeemed and, if less than all shares held by the particular
holder are to be redeemed, the number of Series D Preferred
Shares to be redeemed from such holder; (iv) the place or places
where certificates for such shares are to be surrendered for
payment of the Redemption Price; and (v) that distributions on
the shares to be redeemed will cease to accrue on the Redemption
Date.
5. If notice has been mailed in accordance with subpara-
graph (4) of this paragraph (D), and such notice provided that on
or before the Redemption Date specified therein all funds neces-
sary for such redemption shall have been set aside by the Com-
pany, separate and apart from its other funds in trust for the
pro rata benefit of the holders of the shares so called for
redemption, so as to be, and to continue to be available there-
for, then, from and after the Redemption Date, distributions on
the Series D Preferred Shares so called for redemption shall
cease to accrue, and said shares shall no longer be deemed to be
outstanding and shall not have the status of Series D Preferred
Shares, and all rights of the holders thereof as shareholders of
the Company (except the right to receive from the Company the
Redemption Price) shall cease. Upon surrender, in accordance
with said notice, of the certificates for any shares so redeemed
(properly endorsed or assigned for transfer, if the Company shall
so require and the notice shall so state), such shares shall be
redeemed by the Company at the Redemption Price. In case fewer
than all the shares represented by any such certificate are
redeemed, a new certificate or certificates shall be issued
evidencing the unredeemed shares without cost to the holder
thereof.
6. Any funds deposited with a bank or trust company for
the purpose of redeeming Series D Preferred Shares shall be
irrevocable except that:
a. the Company shall be entitled to receive from such
bank or trust company the interest or other earnings, if any,
earned on any money so deposited in trust, and the holders of any
shares redeemed shall have no claim to such interest or other
earnings; and
b. any balance of monies so deposited by the
Company and unclaimed by the holders of the Series D Preferred
Shares entitled thereto at the expiration of two years from the
applicable Redemption Date shall be repaid, together with any
interest or other earnings earned thereon, to the Company, and
after any such repayment, the holders of the shares entitled to
the funds so repaid to the Company shall look only to the Company
for payment without interest or other earnings.
7. No Series D Preferred Shares may be redeemed except
with assets legally available for the payment of the Redemption
Price.
8. Unless full cumulative distributions on all Series D
Preferred Shares shall have been or contemporaneously are
authorized and paid or authorized and a sum sufficient for the
payment thereof set apart for payment for all past Distribution
Periods and the then current Distribution Period, no Series D
Preferred Shares shall be redeemed unless all outstanding Series
D Preferred Shares are simultaneously redeemed; provided,
however, that the foregoing shall not prevent the purchase or
acquisition of Series D Preferred Shares pursuant to a purchase
or exchange offer made on the same terms to holders of all
outstanding Series D Preferred Shares, provided further, however,
that the foregoing shall not prevent the purchase or acquisition
of Series D Preferred Shares from persons owning in the aggregate
9.8 percent or more of the lesser of the number or value of the
total outstanding shares of beneficial interest of the Company
pursuant to provisions of the Declaration of Trust, or 10 percent
or more of the lesser of the number or value of the total
outstanding Series D Preferred Shares pursuant to provisions of
these Articles Supplementary. Unless full cumulative
distributions on all outstanding Series D Preferred Shares have
been or contemporaneously are authorized and paid or authorized
and a sum sufficient for the payment thereof set apart for
payment for all past Distribution Periods and the then current
Distribution Period, the Company shall not purchase or otherwise
acquire directly or indirectly any Series D Preferred Shares
(except by conversion into or exchange for shares of the Company
ranking junior to the Series D Preferred Shares as to
distributions and upon liquidation, dissolution or winding up of
the affairs of the Company).
9. All Series D Preferred Shares redeemed pursuant to this
paragraph (D) shall be retired and shall be reclassified as
authorized and unissued preferred shares, without designation as
to class or series, and may thereafter be reissued as any class
or series of preferred shares.
E. Voting Rights.
1. The holders of Series D Preferred Shares shall not be
entitled to vote on any matter except (i) as provided in
paragraph (H) or (ii) as provided in subparagraph (2) of this
paragraph (E).
2. In the event the Company shall have failed to authorize
and pay or set apart for payment in full the distributions
accumulated on the outstanding Series D Preferred Shares for any
six or more quarterly Distribution Periods, regardless of whether
such quarterly periods are consecutive (a "Preferential
Distribution Non-Payment"), the number of trustees of the Company
shall be increased by two and the holders of the outstanding
Series D Preferred Shares, voting together as a class with all
other classes or series of preferred shares of the Company
ranking on a parity with the Series D Preferred Shares with
respect to distribution rights and then entitled to vote on the
election of such additional two trustees, shall be entitled to
elect such two additional trustees until the full distributions
accumulated for the past distribution periods and the then
current distribution period on all outstanding Series D Preferred
Shares have been authorized and paid or set apart for payment.
Upon the occurrence of a Preferential Distribution Non-Payment or
a vacancy in the office of a Preferred Shares Trustee, the Board
of Trustees may, and upon the written request of the holders of
record of not less than 20% of the holders of the Series D
Preferred Shares and all holders of other classes or series of
preferred shares of the Company ranking on a parity with the
Series D Preferred Shares with respect to distribution rights who
are then entitled to vote on the election of such additional
trustee or trustees shall, call a special meeting of such holders
for the purpose of electing the additional trustee or trustees.
In the case of such a written request, such special meeting shall
be held within 90 days after the delivery of such request and, in
either case, at the place and upon the notice provided by law and
in the Bylaws of the Company, provided that the Company shall not
be required to call such a special meeting if such request is
received less than 90 days before the date fixed for the next
ensuing annual meeting of shareholders of the Company and all
holders of the Series D Preferred Shares and shares of any other
class or series of preferred shares of the Company ranking on a
parity with the Series D Preferred Shares with respect to
distribution rights are afforded the opportunity to elect such
additional trustee or trustees (or fill any vacancy) at such
annual meeting of shareholders.
If and when all accumulated distributions on the Series D
Preferred Shares have been authorized and paid or set aside for
payment in full, the holders of the Series D Preferred Shares
shall be divested of the special voting rights provided by this
subparagraph (2) of paragraph (E), subject to revesting in the
event of each and every subsequent Preferential Distribution Non-
Payment. Upon termination of such special voting rights attrib-
utable to all holders of the Series D Preferred Shares and shares
of any other class or series of preferred shares of the Company
ranking on a parity with the Series D Preferred Shares with
respect to distribution rights, the term of office of each
trustee elected by the holders of the Series D Preferred Shares
and such parity preferred shares (a "Preferred Shares Trustee")
pursuant to such special voting rights shall forthwith terminate
and the number of trustees constituting the entire Board of
Trustees shall be reduced by the number of Preferred Shares
Trustees. Any Preferred Shares Trustee may be removed only by
the vote of the holders of record of a majority of the
outstanding Series D Preferred Shares and all other series of
preferred shares of the Company ranking on a parity with the
Series D Preferred Shares with respect to distribution rights who
would then be entitled to vote in such Preferred Shares Trustee's
election, voting together as a separate class, at a meeting
called for such purpose.
3. So long as any Series D Preferred Shares are outstand-
ing, the number of trustees constituting the entire Board of
Trustees of the Company shall at all times be such that the exer-
cise, by the holders of the Series D Preferred Shares and the
holders of preferred shares of the Company ranking on a parity
with the Series D Preferred Shares with respect to distribution
rights, of the right to elect trustees under the circumstances
provided for in subparagraph (2) of this paragraph (E) will not
contravene any provision of the Declaration of Trust restricting
the number of trustees which may constitute the entire Board of
Trustees.
4. Trustees elected pursuant to subparagraph (2) of this
paragraph (E) shall serve until the earlier of (x) the next
annual meeting of the shareholders of the Company and the
election (by the holders of the Series D Preferred Shares and the
holders of preferred shares of the Company ranking on a parity
with the Series D Preferred Shares with respect to distribution
rights) and qualification of their respective successors or (y)
the termination of the term of office of each Preferred Shares
Trustee upon the termination of the special voting rights as
provided for in subparagraph (2) of this paragraph (E) or as
otherwise provided for in subparagraph (2) of this paragraph (E).
5. So long as a Preferential Distribution Non-Payment
shall continue, any vacancy in the office of a Preferred Shares
Trustee may be filled by vote of the holders of record of a
majority of the outstanding Series D Preferred Shares and all
other series of preferred shares ranking on a parity with the
Series D Preferred Shares with respect to distribution rights who
are then entitled to vote in the election of such Preferred
Shares Trustee as provided above. As long as the Preferential
Distribution Non-Payment shall continue, holders of the Series D
Preferred Shares shall not, as such shareholders, be entitled to
vote on the election or removal of trustees other than Preferred
Shares Trustees, but shall not be divested of any other voting
rights provided to such shareholders by the Declaration of Trust
and these Articles Supplementary with respect to any other matter
to be acted upon by the shareholders of the Company.
F. Restriction on Transfer and Ownership of Series D
Preferred Shares
1. The terms and provisions of this paragraph (F) shall
apply in addition to, and not in limitation of, the terms and
provisions of Section 6.6 of the Declaration of Trust.
2. Definitions. In addition to the definitions set forth
in paragraph (A) above, for the purpose of this paragraph (F),
the following terms shall have the following meanings:
Beneficial Ownership. The term "Beneficial Ownership"
shall mean ownership of Series D Preferred Shares by a Person,
whether the interest in Series D Preferred Shares is held
directly or indirectly (including by a nominee), and shall
include interests that would be treated as owned through the
application of Section 544 of the Code, as modified by Section
856(h)(1)(B) of the Code. The terms "Beneficial Owner,"
"Beneficially Owns" and "Beneficially Owned" shall have the
correlative meanings.
Charitable Beneficiary. The term "Charitable
Beneficiary" shall mean one or more beneficiaries of the
Charitable Trust as determined pursuant to subparagraph (4) (f)
of this paragraph (F), provided that each such organization must
be described in Section 501(c)(3) of the Code and contributions
to each such organization must be eligible for deduction under
each of Sections 170(b)(1)(A), 2055 and 2522 of the Code.
Charitable Trust. The term "Charitable Trust" shall
mean any trust provided for in subparagraph (4)(a) of this
paragraph (F).
Constructive Ownership. The term "Constructive
Ownership" shall mean ownership of Series D Preferred Shares by a
Person, whether the interest in Series D Preferred Shares is held
directly or indirectly (including by a nominee), and shall
include interests that would be treated as owned through the
application of Section 318(a) of the Code, as modified by Section
856(d)(5) of the Code. The terms "Constructive Owner,"
"Constructively Owns" and "Constructively Owned" shall have the
correlative meanings.
Excepted Holder. The term "Excepted Holder" shall mean
any shareholder of the Company for whom an Excepted Holder Limit
is created by this paragraph (F) or by the Board of Trustees
pursuant to subparagraph (3)(g)(i) of this paragraph (F).
Excepted Holder Limit. The term "Excepted Holder Limit"
shall mean with respect to any Excepted Holder, provided that the
affected Excepted Holder agrees to comply with the requirements
established by the Board of Trustees pursuant to subparagraph
(3)(g)(i) of this paragraph (F), and subject to adjustment
pursuant to subparagraph (3)(h) of this paragraph (F), the
percentage limit established by the Board of Trustees pursuant to
subparagraph (3)(g)(i) of this paragraph (F).
Initial Date. The term "Initial Date" shall mean the
date upon which these Articles Supplementary containing this
paragraph (F) is accepted for record by the State Department of
Assessments and Taxation of Maryland.
Market Price. The term "Market Price" on any date shall
mean, with respect to any class or series of outstanding Series D
Preferred Shares, the Closing Price for such Series D Preferred
Shares on such date. The "Closing Price" on any date shall mean
the last sale price for such Series D Preferred Shares, regular
way, or, in case no such sale takes place on such day, the
average of the closing bid and asked prices, regular way, for
such Series D Preferred Shares, in either case as reported on the
principal consolidated transaction reporting system with respect
to securities listed or admitted to trading on the principal
national securities exchange on which such Series D Preferred
Shares are listed or admitted to trading or, if such Series D
Preferred Shares are not listed or admitted to trading on any
national securities exchange, the last quoted price, or, if not
so quoted, the average of the high bid and low asked prices in
the over-the-counter market, as reported by the National
Association of Securities Dealers, Inc. Automated Quotation
System or, if such system is no longer in use, the principal
other automated quotation system that may then be in use or, if
such Series D Preferred Shares are not quoted by any such
organization, the average of the closing bid and asked prices as
furnished by a professional market maker making a market in such
Series D Preferred Shares selected by the Board of Trustees or,
in the event that no trading price is available for such Series D
Preferred Shares, the fair market value of Series D Preferred
Shares, as determined in good faith by the Board of Trustees,
which determination shall be conclusive for all purposes hereof.
Prohibited Owner. The term "Prohibited Owner" shall
mean, with respect to any purported Transfer, any Person who, but
for the provisions of subparagraph (3)(a) of this paragraph (F),
would Beneficially Own or Constructively Own Series D Preferred
Shares in violation of the provisions of subparagraph (3)(a)(i)
of this paragraph (F) and if appropriate in the context, shall
also mean any Person who would have been the record owner of
Series D Preferred Shares that the Prohibited Owner would have so
owned.
Restriction Termination Date. The term "Restriction
Termination Date" shall mean the first day, after the Initial
Date, on which the Board of Trustees determines that it is no
longer in the best interests of the Company to attempt to, or
continue to, qualify as a REIT or that compliance with the
restrictions and limitations on Beneficial Ownership,
Constructive Ownership and Transfers of Series D Preferred Shares
set forth herein is no longer required in order for the Company
to qualify as a REIT.
Series D Preferred Share Ownership Limit. The term
"Series D Preferred Share Ownership Limit" shall mean not more
than 10 percent (in value or in number of shares, whichever is
more restrictive) of the aggregate of the outstanding Series D
Preferred Shares. The number and value of outstanding Series D
Preferred Shares shall be determined by the Board of Trustees in
good faith, which determination shall be conclusive for all
purposes hereof.
Transfer. The term "Transfer" shall mean any issuance,
sale, transfer, gift, assignment, devise or other disposition, as
well as any other event that causes any Person to acquire
Beneficial Ownership or Constructive Ownership, or any agreement
to take any such actions or cause any such events, of Series D
Preferred Shares or the right to vote or receive dividends on
Series D Preferred Shares, including (a) the granting or exercise
of any option (or any disposition of any option), (b) any
disposition of any securities or rights convertible into or
exchangeable for Series D Preferred Shares or any interest in
Series D Preferred Shares or any exercise of any such conversion
or exchange right and (c) Transfers of interests in other
entities that result in changes in Beneficial or Constructive
Ownership of Series D Preferred Shares; in each case, whether
voluntary or involuntary, whether owned of record, Constructively
Owned or Beneficially Owned and whether by operation of law or
otherwise. The terms "Transferring" and "Transferred" shall have
the correlative meanings.
Trustee. The term "Trustee" shall mean the Person,
unaffiliated with the Company and a Prohibited Owner, that is
appointed by the Company to serve as trustee of the Charitable
Trust.
3. Series D Preferred Shares.
a. Ownership Limitations. During the period
commencing on the Initial Date and prior to the Restriction
Termination Date:
(i) Basic Restrictions. No Person, other
than an Excepted Holder, shall Beneficially Own or Constructively
Own Series D Preferred Shares in excess of the Series D Preferred
Share Ownership Limit, and no Excepted Holder shall Beneficially
Own or Constructively Own Series D Preferred Shares in excess of
the Excepted Holder Limit for such Excepted Holder.
(ii) Transfer in Trust. If any Transfer of
Series D Preferred Shares (whether or not such Transfer is the
result of a transaction entered into through the facilities of
any national securities exchange or automated inter-dealer
quotation system) occurs which, if effective, would result in any
Person Beneficially Owning or Constructively Owning Series D
Preferred Shares in violation of subparagraph (3)(a)(i) of this
paragraph (F),
(x) then that number of Series D Preferred
Shares the Beneficial or Constructive Ownership of which
otherwise would cause such Person to violate subparagraph
(3)(a)(i) of this paragraph (F) (rounded to the nearest whole
share) shall be automatically transferred to a Charitable Trust
for the benefit of a Charitable Beneficiary, as described in
subparagraph (4) of this paragraph (F), effective as of the close
of business on the Business Day prior to the date of such
Transfer, and such Person shall acquire no rights in such Series
D Preferred Shares; or
(y) if the transfer to the Charitable Trust
described in clause (x) of this sentence would not be effective
for any reason to prevent the violation of subparagraph (3)(a)(i)
of this paragraph (F), then the Transfer of that number of Series
D Preferred Shares that otherwise would cause any Person to
violate subparagraph (3)(a)(i) of this paragraph (F) shall be
void ab initio and the intended transferee shall acquire no
rights in such Series D Preferred Shares.
b. Remedies for Breach. If the Board of Trustees or
any duly authorized committee thereof shall at any time determine
in good faith that a Transfer or other event has taken place that
results in a violation of subparagraph (3)(a) of this paragraph
(F) or that a Person intends to acquire or has attempted to
acquire Beneficial or Constructive Ownership of any Series D
Preferred Shares in violation of subparagraph (3)(a) of this
paragraph (F) (whether or not such violation is intended), the
Board of Trustees or a committee thereof shall take such action
as it deems advisable to refuse to give effect to or to prevent
such Transfer or other event, including, without limitation,
causing the Company to redeem Series D Preferred Shares, refusing
to give effect to such Transfer on the books of the Company or
instituting proceedings to enjoin such Transfer or other event;
provided, however, that any Transfer or attempted Transfer or
other event in violation of subparagraph (3)(a) of this paragraph
(F) shall automatically result in the transfer to the Charitable
Trust described above, and, where applicable, such Transfer (or
other event) shall be void ab initio as provided above,
irrespective of any action (or non-action) by the Board of
Trustees or a committee thereof.
c. Notice of Restricted Transfer. Any Person who
acquires or attempts or intends to acquire Beneficial Ownership
or Constructive Ownership of Series D Preferred Shares that will
or may violate subparagraph (3)(a)(i) of this paragraph (F), or
any Person who would have owned Series D Preferred Shares that
resulted in a transfer to the Charitable Trust pursuant to the
provisions of subparagraph (3)(a)(ii) of this paragraph (F),
shall immediately give written notice to the Company of such
event, or in the case of such a proposed or attempted
transaction, give at least 15 days prior written notice, and
shall provide to the Company such other information as the
Company may request in order to determine the effect, if any, of
such Transfer on the Company's status as a REIT.
d. Owners Required To Provide Information. From the
Initial Date and prior to the Restriction Termination Date:
(i) every owner of more than five percent (or
such lower percentage as required by the Code or the Treasury
Regulations promulgated thereunder) of the outstanding Series D
Preferred Shares, within 30 days after the end of each taxable
year, shall give written notice to the Company stating the name
and address of such owner, the number of Series D Preferred
Shares Beneficially Owned and a description of the manner in
which such shares are held. Each such owner shall provide to the
Company such additional information as the Company may request in
order to determine the effect, if any, of such Beneficial
Ownership on the Company's status as a REIT and to ensure
compliance with the Series D Preferred Share Ownership Limit.
(ii) each Person who is a Beneficial or
Constructive Owner of Series D Preferred Shares and each Person
(including the shareholder of record) who is holding Series D
Preferred Shares for a Beneficial or Constructive Owner shall
provide to the Company such information as the Company may
request, in good faith, in order to determine the Company's
status as a REIT and to comply with requirements of any taxing
authority or governmental authority or to determine such
compliance.
e. Remedies Not Limited. Subject to subparagraph (5)
of paragraph (F) and Article III to the Declaration of Trust,
nothing contained in this subparagraph (3) of this paragraph (F)
shall limit the authority of the Board of Trustees to take such
other action as it deems necessary or advisable to protect the
Company and the interests of its shareholders in preserving the
Company's status as a REIT.
f. Ambiguity. In the case of an ambiguity in the
application of any of the provisions of this subparagraph (3) of
this paragraph (F), subparagraph (4) of this paragraph (F) or any
definition contained in subparagraph (2) of this paragraph (F),
the Board of Trustees shall have the power to determine the
application of the provisions of this subparagraph (3) of this
paragraph (F) or subparagraph (4) of this paragraph (F) with
respect to any situation based on the facts known to it. If
subparagraph (3) or subparagraph (4) of this paragraph (F)
requires an action by the Board of Trustees and these Articles
Supplementary fail to provide specific guidance with respect to
such action, the Board of Trustees shall have the power to
determine the action to be taken so long as such action is not
contrary to the provisions of subparagraph (2), (3) or (4) of
this paragraph (F).
g. Exceptions.
(i) The Board of Trustees, in its sole discretion,
may exempt a Person from the Series D Preferred Share Ownership
Limit, and may establish or increase an Excepted Holder Limit for
such Person if:
(x) the Board of Trustees obtains such
representations and undertakings from such Person as are
reasonably necessary to ascertain that such Person's Beneficial
or Constructive Ownership of such Series D Preferred Shares would
not result in the Company being "closely held" within the meaning
of Section 856(h) of the Code (without regard to whether the
ownership interest is held during the last half of a taxable
year), or otherwise failing to qualify as a REIT (including, but
not limited to, Beneficial or Constructive Ownership that would
result in the Company owning (actually or Constructively) an
interest in a tenant that is described in Section 856(d)(2)(B) of
the Code if the income derived by the Company from such tenant
would cause the Company to fail to satisfy any of the gross
income requirements of Section 856(c) of the Code);
(y) such Person does not and represents that
it will not own, actually or Constructively, an interest in a
tenant of the Company (or a tenant of any entity owned or
controlled by the Company) that would cause the Company to own,
actually or Constructively, more than a 10 percent interest (as
set forth in Section 856(d) (2) (B) of the Code) in such tenant
and the Board of Trustees obtains such representations and
undertakings from such Person as are reasonably necessary to
ascertain this fact (for this purpose, a tenant from whom the
Company (or an entity owned or controlled by the Company) derives
(and is expected to continue to derive) a sufficiently small
amount of revenue such that, in the opinion of the Board of
Trustees, rent from such tenant would not adversely affect the
Company's ability to qualify as a REIT, shall not be treated as a
tenant of the Company); and
(z) such Person agrees that any violation or
attempted violation of such representations or undertakings (or
other action which is contrary to the restrictions contained in
subparagraphs 3(a) through 3(f) of this paragraph (F)) will
result in such Series D Preferred Shares being automatically
transferred to a Charitable Trust in accordance with
subparagraphs 3(a)(i) and (4) of this paragraph (F).
(ii) Prior to granting any exception pursuant to
subparagraph (3)(g)(i) of this paragraph (F), the Board of
Trustees may require a ruling from the Internal Revenue Service,
or an opinion of counsel, in either case in form and substance
satisfactory to the Board of Trustees in its sole discretion, as
it may deem necessary or advisable in order to determine or
ensure the Company's status as a REIT. Notwithstanding the
receipt of any ruling or opinion, the Board of Trustees may
impose such conditions or restrictions as it deems appropriate in
connection with granting such exception.
(iii) An underwriter which participates in a
public offering or a private placement of Series D Preferred
Shares (or securities convertible into or exchangeable for Series
D Preferred Shares) may Beneficially Own or Constructively Own
Series D Preferred Shares (or securities convertible into or
exchangeable for Series D Preferred Shares) in excess of the
Series D Preferred Share Ownership Limit, but only to the extent
and for so long as it is necessary to facilitate such public
offering or private placement.
(iv) The Board of Trustees may only reduce the
Excepted Holder Limit for an Excepted Holder: (1) with the
written consent of such Excepted Holder at any time, or (2)
pursuant to the terms and conditions of the agreements and
undertakings entered into with such Excepted Holder in connection
with the establishment of the Excepted Holder Limit for that
Excepted Holder. No Excepted Holder Limit shall be reduced to a
percentage that is less than the Series D Preferred Share
Ownership Limit.
h. Increase in Series D Preferred Share Ownership
Limits. The Board of Trustees may from time to time increase the
Series D Preferred Share Ownership Limit if the Board determines,
in its sole discretion, that such increase will not adversely
affect the Company's ability to qualify as a REIT.
i. Legend. Each certificate for Series D Preferred
Shares shall bear substantially the following legend:
The shares evidenced by this certificate are subject to
restrictions on Beneficial and Constructive Ownership
and Transfer for the purpose of the Company's
maintenance of its status as a Real Estate Investment
Trust (a "REIT") under the Internal Revenue Code of
1986, as amended (the "Code"). Subject to certain
further restrictions and except as expressly provided
in the Company's Declaration of Trust, as amended and
supplemented, no Person may Beneficially or
Constructively Own Series D Preferred Shares of the
Company in excess of 10 percent (in value or number of
shares) of the outstanding Series D Preferred Shares of
the Company unless such Person is an Excepted Holder
(in which case the Excepted Holder Limit shall be
applicable). Any Person who Beneficially or
Constructively Owns or attempts to Beneficially or
Constructively Own Series D Preferred Shares which
cause or will cause a Person to Beneficially or
Constructively Own Series D Preferred Shares in excess
or in violation of the above limitations must
immediately notify the Company. If any of the
restrictions on transfer or ownership are violated, the
Series D Preferred Shares represented hereby will be
automatically transferred to a Trustee of a Charitable
Trust for the benefit of one or more Charitable
Beneficiaries. In addition, upon the occurrence of
certain events, attempted Transfers in violation of the
restrictions described above may be void ab initio.
All capitalized terms in this legend have the meanings
defined in the Company's Articles Supplementary
relating to the Series D Preferred shares, as the same
may be amended from time to time, a copy of which,
including the restrictions on transfer and ownership,
will be furnished to each holder of Series D Preferred
Shares of the Company on request and without charge.
Instead of the foregoing legend, the certificate may state
that the Company will furnish a full statement about certain
restrictions on transferability to a shareholder on request and
without charge.
4. Transfer of Series D Preferred Shares in Trust.
a. Ownership in Trust. Upon any purported Transfer or
other event described in subparagraph (3)(a)(ii) of this
paragraph (F) that would result in a transfer of Series D
Preferred Shares to a Charitable Trust, such Series D Preferred
Shares shall be deemed to have been transferred to the Trustee as
trustee of a Charitable Trust for the exclusive benefit of one or
more Charitable Beneficiaries. Such transfer to the Trustee shall
be deemed to be effective as of the close of business on the
Business Day prior to the purported Transfer or other event that
results in the transfer to the Charitable Trust pursuant to
subparagraph (3)(a)(ii) of this paragraph (F). The Trustee shall
be appointed by the Board of Trustees of the Company and shall be
a Person unaffiliated with the Company and any Prohibited Owner.
Each Charitable Beneficiary shall be designated by the Company as
provided in subparagraph (4)(f) of this paragraph (F).
b. Status of Shares Held by the Trustee. Series D
Preferred Shares held by the Trustee shall be issued and
outstanding Series D Preferred Shares of the Company. The
Prohibited Owner shall have no rights in the shares held by the
Trustee. The Prohibited Owner shall not benefit economically from
ownership of any shares held in trust by the Trustee, shall have
no rights to dividends or other distributions and shall not
possess any rights to vote or other rights attributable to the
shares held in the Charitable Trust.
c. Dividend and Voting Rights. The Trustee shall have
all voting rights and rights to dividends or other distributions
with respect to Series D Preferred Shares held in the Charitable
Trust, which rights shall be exercised for the exclusive benefit
of the Charitable Beneficiary. Any dividend or other distribution
paid with respect to Series D Preferred Shares after the time
that such Series D Preferred Shares have been transferred to the
Trustee but before the discovery by the Company of such transfer
shall be paid by the Prohibited Owner to the Trustee upon demand
and any dividend or other distribution authorized but unpaid
shall be paid when due to the Trustee. Any dividends or
distributions so paid over to the Trustee shall be held in trust
for the Charitable Beneficiary. The Prohibited Owner shall have
no voting rights with respect to shares held in the Charitable
Trust and, subject to Maryland law, effective as of the date that
Series D Preferred Shares have been transferred to the Trustee,
the Trustee shall have the authority (at the Trustee's sole
discretion) (i) to rescind as void any vote cast by a Prohibited
Owner prior to the discovery by the Company that Series D
Preferred Shares have been transferred to the Trustee (but only
votes cast with respect to such transferred Series D Preferred
Shares) and (ii) to recast such vote in accordance with the
desires of the Trustee acting for the benefit of the Charitable
Beneficiary; provided, however, that if the Company has already
taken irreversible trust action, then the Trustee shall not have
authority to rescind and recast such vote. Notwithstanding the
provisions of this paragraph (F), until the Company has received
notification that Series D Preferred Shares have been transferred
into a Charitable Trust, the Company shall be entitled to rely on
its share transfer and other shareholder records for purposes of
preparing lists of shareholders entitled to vote at meetings,
determining the validity and authority of proxies and otherwise
conducting votes of shareholders.
d. Sale of Shares by Trustee. Within 20 days of
receiving notice from the Company that Series D Preferred Shares
have been transferred to the Charitable Trust, the Trustee of the
Charitable Trust shall sell the shares held in the Charitable
Trust to a person, designated by the Trustee, whose ownership of
the shares will not violate the ownership limitations set forth
in subparagraph (3)(a)(i) of this paragraph (F). Upon such sale,
the interest of the Charitable Beneficiary in the shares sold
shall terminate and the Trustee shall distribute the net proceeds
of the sale to the Prohibited Owner and to the Charitable
Beneficiary as provided in this subparagraph (4)(d) of this
paragraph (F). The Prohibited Owner shall receive the lesser of
(1) the price paid by the Prohibited Owner for the shares or, if
the Prohibited Owner did not give value for the shares in
connection with the event causing the shares to be held in the
Charitable Trust (e.g., in the case of a gift, devise or other
such transaction), the Market Price of the shares on the day of
the event causing the shares to be held in the Charitable Trust
and (2) the price per share received by the Trustee from the sale
or other disposition of the shares held in the Charitable Trust.
In addition, if a Prohibited Owner has received any dividend or
other distribution paid with respect to Series D Preferred Shares
prior to the discovery by the Company that such Series D
Preferred Shares have been transferred to the Trustee and the
Prohibited Owner has not paid the Trustee the amount of such
dividend or other distribution as required by subparagraph (4)(c)
of this paragraph (F), the amount received by the Prohibited
Owner pursuant to the preceding sentence shall be reduced by the
amount of such dividend or other distribution. Any net sales
proceeds in excess of the amount payable to the Prohibited Owner
shall be immediately paid to the Charitable Beneficiary. If,
prior to the discovery by the Company that Series D Preferred
Shares have been transferred to the Trustee, such shares are sold
by a Prohibited Owner, then (i) such shares shall be deemed to
have been sold on behalf of the Charitable Trust and (ii) to the
extent that the Prohibited Owner received an amount for such
shares that exceeds the amount that such Prohibited Owner was
entitled to receive pursuant to this subparagraph (4)(d) of this
paragraph (F), such excess shall be paid by the Prohibited Owner
to the Trustee upon demand.
e. Purchase Right in Shares Transferred to the
Trustee. Series D Preferred Shares transferred to the Trustee
shall be deemed to have been offered for sale to the Company, or
its designee, at a price per share equal to the lesser of (i) the
price per share in the transaction that resulted in such transfer
to the Charitable Trust (or, in the case of a devise or gift, the
Market Price at the time of such devise or gift) and (ii) the
Market Price on the date the Company, or its designee, accepts
such offer. The Company shall have the right to accept such offer
until the Trustee has sold the shares held in the Charitable
Trust pursuant to subparagraph (4)(d) of this paragraph (F). Upon
such a sale to the Company, the interest of the Charitable
Beneficiary in the shares sold shall terminate and the Trustee
shall distribute the net proceeds of the sale to the Prohibited
Owner.
f. Designation of Charitable Beneficiaries. By
written notice to the Trustee, the Board of Trustees of the
Company shall designate one or more nonprofit organizations to be
the Charitable Beneficiary of the interest in the Charitable
Trust such that (i) Series D Preferred Shares held in the
Charitable Trust would not violate the restrictions set forth in
subparagraph (3)(a)(i) of this paragraph (F) in the hands of such
Charitable Beneficiary and (ii) each such organization must be
described in Section 501(c)(3) of the Code and contributions to
each such organization must be eligible for deduction under each
of Sections 170(b)(1)(A), 2055 and 2522 of the Code.
5. Stock Exchange Transactions. Nothing in this paragraph
(F) shall preclude the settlement of any transaction entered into
through the facilities of any national securities exchange or
automated inter-dealer quotation system. The fact that the
settlement of any transaction occurs or takes place shall not
negate the effect of any other provision of this paragraph (F)
and any transferee in such a transaction shall be subject to all
of the provisions and limitations set forth in this paragraph
(F).
6. Enforcement. The Company is authorized specifically to
seek equitable relief, including injunctive relief, to enforce
the provisions of this paragraph (F).
7. Non-Waiver. No delay or failure on the part of the
Company or the Board of Trustees in exercising any right
hereunder shall operate as a waiver of any right of the Company
or the Board of Trustees, as the case may be, except to the
extent specifically waived in writing.
G. Ranking.
With regard to rights to receive distributions and amounts
payable upon liquidation, dissolution or winding up of the
Company, the Series D Preferred Shares rank senior to the Common
Shares, and on a parity with the Series A-1 Preferred Shares, the
Series B-1 Preferred Shares, the Series B-2 Preferred Shares and
the Series C Preferred Shares and any other preferred shares
issued by the Company, unless the terms of such other preferred
shares provide otherwise and, if applicable, the requirements of
paragraph (H) hereof have been complied with. However, the
Company may authorize or increase any class or series of shares
of beneficial interest ranking on a parity with or junior to the
Series D Preferred Shares as to distribution rights or
liquidation preference without the vote or consent of the holders
of the Series D Preferred Shares.
H. Limitations.
So long as any Series D Preferred Shares are outstanding,
the Company shall not, without the affirmative vote, or the
written consent, of the holders of at least two-thirds of the
total number of outstanding Series D Preferred Shares, voting as
a class,
1. authorize, create or issue, or increase the
authorized or issued amount of, any class or series of,
or rights to subscribe to or acquire, any security
convertible into, any class or series of shares of
beneficial interest ranking as to distribution rights
or liquidation preference, senior to the Series D
Preferred Shares, or reclassify any shares of
beneficial interest into any such shares; or
2. amend, alter or repeal, whether by merger,
consolidation or otherwise, any of the provisions of
the Declaration of Trust (including these Articles
Supplementary) that would change the preferences,
rights or privileges with respect to the Series D
Preferred Shares so as to affect the Series D Preferred
Shares materially and adversely;
but (except as otherwise expressly required by applicable law)
nothing herein contained shall require such a vote or consent (i)
in connection with any increase in the total number of authorized
Common Shares; (ii) in connection with the authorization or
increase of any class or series of shares of beneficial interest
ranking, as to distribution rights and liquidation preference, on
a parity with or junior to the Series D Preferred Shares;
(iii) in connection with any merger or consolidation in which the
Company is the surviving entity if, immediately after the merger
or consolidation, there are outstanding no shares of beneficial
interest and no securities convertible into shares of beneficial
interest ranking as to distribution rights or liquidation
preference senior to the Series D Preferred Shares other than the
securities of the Company outstanding prior to such merger or
consolidation; (iv) in connection with any merger or
consolidation in which the Company is not the surviving entity
if, as a result of the merger or consolidation, the holders of
Series D Preferred Shares receive shares of stock or beneficial
interest or other equity securities with preferences, rights and
privileges substantially identical to the preferences, rights and
privileges of the Series D Preferred Shares and there are
outstanding no shares of stock or beneficial interest or other
equity securities of the surviving entity ranking as to
distribution rights or liquidation preference senior to the
Series D Preferred Shares other than the securities of the
Company outstanding prior to such merger or consolidation; or (v)
if, at or prior to the time when the issuance of any such shares
ranking senior to the Series D Preferred Shares is to be made or
any such change is to take effect, as the case may be, the Series
D Preferred Shares have been called for redemption upon proper
notice and sufficient funds have been irrevocably deposited in
trust for the redemption of all the then outstanding Series D
Preferred Shares.
I. Exclusion of Other Rights.
The Series D Preferred Shares shall not have any preferences
or other rights, voting powers, restrictions, limitations as to
dividends or other distributions, qualifications or terms or
conditions of redemption other than expressly set forth herein or
elsewhere in the Declaration of Trust.
J. Headings of Subdivisions.
The headings of the various subdivisions hereof are for
convenience of reference only and shall not affect the
interpretation of any of the provisions hereof.
K. Severability of Provisions.
If any preferences or other rights, voting powers,
restrictions, limitations as to dividends or other distributions,
qualifications or terms or conditions of redemption of the Series
D Preferred Shares set forth in the Declaration of Trust is
invalid, unlawful or incapable of being enforced by reason of any
rule of law or public policy, all other preferences or other
rights, voting powers, restrictions, limitations as to dividends
or other distributions, qualifications or terms or conditions of
redemption of Series D Preferred Shares set forth herein or
elsewhere in the Declaration of Trust which can be given effect
without the invalid, unlawful or unenforceable provision thereof
shall, nevertheless, remain in full force and effect and no
preferences or other rights, voting powers, restrictions, limita-
tions as to dividends or other distributions, qualifications or
terms or conditions of redemption of the Series D Preferred
Shares herein set forth shall be deemed dependent upon any other
provision thereof unless so expressed therein.
L. No Preemptive Rights.
No holder of Series D Preferred Shares shall be entitled to
any preemptive rights to subscribe for or acquire any unissued
shares of beneficial interest of the Company (whether now or
hereafter authorized) or securities of the Company convertible
into or carrying a right to subscribe to or acquire shares of
beneficial interest of the Company.
M. Conversion.
The Series D Preferred Shares are not convertible into or
exchangeable for any other property or securities of the Company.
SECOND: The Series D Preferred Shares have been
classified by the Board of Trustees under a power contained in
the Declaration of Trust.
THIRD: These Articles Supplementary have been
approved by the Board of Trustees in the manner and by the vote
required by law.
FOURTH: Each of the undersigned acknowledges these
Articles Supplementary to be the act of the Company and as to all
matters or facts required to be verified under oath, that to the
best of his knowledge, information and belief, these matters and
facts are true in all material respects and such statement is
made under the penalties for perjury.
FIFTH: These Articles Supplementary and all docu-
ments, agreements, understandings and arrangements relating
hereto have been entered into or executed on behalf of the Com-
pany by the undersigned in his capacity as an officer or trustee
of the Company, which has been formed as a Maryland real estate
investment trust pursuant to a declaration of trust of the
Company dated as of November 4, 1992, as amended, and not
individually, and neither the trustees, officers nor shareholders
of the Company shall be bound or have any personal liability
hereunder or thereunder. Holders of the Series D Preferred
Shares shall look solely to the assets of the Company for
satisfaction of any liability of the Company in respect of these
Articles Supplementary and all documents, agreements,
understandings and arrangements relating hereto and will not seek
recourse or commence any action against any of the trustees,
officers or shareholders of the Company or any of their personal
assets for the performance or payment of any obligation hereunder
or thereunder. The foregoing shall also apply to any future
documents, agreements, understandings, arrangements or
transactions between the Company and holders of the Series D
Preferred Shares.
<PAGE>
IN WITNESS WHEREOF, the Company has caused these
Articles Supplementary to be executed under seal in its name and
on its behalf by its President and attested to by its Secretary
on this 10th day of December, 1997.
KRANZCO REALTY TRUST
By: /s/Norman Kranzdorf(Seal)
-------------------------
Norman Kranzdorf
President
ATTEST:
By: /s/ Hermina Kranzdorf
-----------------------
Hermina Kranzdorf
Secretary
TEMPORARY CERTIFICATE - EXCHANGEABLE FOR DEFINITIVE
ENGRAVED CERTIFICATE WHEN READY FOR DELIVERY
-------- --------
| Number | KRANZCO REALTY TRUST | Shares |
| | A REAL ESTATE TRUST FORMED UNDER | |
|T | THE LAWS OF THE STATE OF MARYLAND | |
-------- --------
THIS CERTIFICATE SEE REVERSE FOR
IS TRANSFERABLE IMPORTANT NOTICE
IN CHARLOTTE, NC ON TRANSFER
AND NEW YORK, NY RESTRICTIONS AND
OTHER INFORMATION
THIS CERTIFIES THAT CUSIP 50076E 40 0
IS THE OWNER OF
FULLY PAID AND NONASSESSABLE SERIES D CUMULATIVE REDEEMABLE PREFERRED SHARES
OF BENEFICIAL INTEREST, $.01 PAR VALUE PER SHARE, OF
Kranzco Realty Trust (the "Trust"), transferable on the books of the Trust by
the holder hereof in person or by its duly authorized attorney upon surrender
of this Certificate properly endorsed. This Certificate and the shares
represented hereby are issued and shall be held subject to all of the
provisions of the Declaration of Trust and Bylaws of the Trust and any
amendments thereto. This Certificate is not valid unless countersigned and
registered by the Transfer Agent and Registrar.
In Witness Whereof, the Trust has caused this Certificate to be executed
on its behalf by its duly authorized officers.
Dated
Countersigned and Registered:
FIRST UNION NATIONAL BANK
(CHARLOTTE, NC)
Transfer Agent
and Registrar
By:
Authorized Signature Secretary President
<PAGE>
IMPORTANT NOTICE
The Trust will furnish to any shareholder, on request and without
charge, a full statement of the information required by Section 8-203(d) of
the Corporations and Associations Article of the Annotated Code of Maryland,
as amended, with respect to the designations and any preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends or
distributions, qualifications, and terms and conditions of redemption of the
shares of each class of beneficial interest which the Trust has authority to
issue and, if the Trust is authorized to issue any preferred or special class
in series, (i) the differences in the relative rights and preferences between
the shares of each series to the extent set, and (ii) the authority of the
Board of Trustees to set such rights and preferences of subsequent series.
The foregoing summary does not purport to be complete and is subject to and
qualified in its entirety by reference to the Declaration of Trust of the
Trust, as amended, a copy of which will be sent without charge to each
shareholder who so requests. Such request must be made to the Secretary of
the Trust at its principal office or to the Transfer Agent.
In addition, the transfer of the shares represented by this Certificate
is restricted as provided in Section 6.6 of the Declaration of Trust of the
Trust, as amended, and Section F(3)(a) of the Articles Supplementary relating
to the Series D Cumulative Redeemable Preferred Shares of Beneficial
Interest, copies of which will be sent without charge to each shareholder who
so requests. Such requests must be made to the Secretary of the Trust at its
principal office or to the Transfer Agent. The Trust will furnish a full
statement about these restrictions on transferability on request and without
charge.
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF IT IS LOST, STOLEN
OR DESTROYED, THE TRUST WILL REQUIRE A BOND OF INDEMNITY AS A
CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE.
The following abbreviations, when used in the inscription on the face of
this Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common
TEN ENT - as tenants by the entireties
JT TEN - as joint tenants with right
of survivorship and not as
tenants in common
UNIF GIFT MIN ACT - ...........Custodian...........
(Cust) (Minor)
under Uniform Gifts to Minors Act of
...............................
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, __________________ hereby sell, assign and transfer unto
____________________________________________________________________________
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE OF ASSIGNEE)
____________________________________________________________________________
(PLEASE INSERT SOCIAL SECURITY OR OTHER IDENTIFYING NUMBER OF ASSIGNEE)
_________________________________________________ (_________) shares of
beneficial interest of the Trust represented by this Certificate and do
hereby irrevocably constitute and appoint ____________________________
Attorney to transfer the said shares on the books of the Trust, with full
power of substitution in the premises.
Dated: ________________
_________________________________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT MUST CORRESPOND
WITH THE NAME AS WRITTEN UPON THE FACE OF THE CERTIFICATE
IN EVERY PARTICULAR, WITHOUT ALTERATION OR ENLARGEMENT OR
ANY CHANGE WHATEVER.
Signature(s) Guaranteed:
By_____________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY
AN ELIGIBLE GUARANTOR INSTITUTION (Banks,
Stockbrokers, Savings and Loan
Associations and Credit Unions) WITH
MEMBERSHIP IN AN APPROVED SIGNATURE
GUARANTEE MEDALLION PROGRAM PURSUANT TO
S.E.C. RULE 17Ad-15.
