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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-A/A
(AMENDMENT NO. 1)
FOR REGISTRATION OF CERTAIN CLASSES OF SECURITIES
PURSUANT TO SECTION 12(b) OR (g) OF THE
SECURITIES EXCHANGE ACT OF 1934
KEYSTONE PROPERTY TRUST
(EXACT NAME OF REGISTRANT AS SPECIFIED IN ITS DECLARATION OF TRUST)
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MARYLAND 84-1246585
(STATE OF ORGANIZATION) (I.R.S. EMPLOYER IDENTIFICATION
NUMBER)
200 FOUR FALLS CORPORATE CENTER, SUITE 208 19428
WEST CONSHOHOCKEN, PA (ZIP CODE)
(ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)
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If this Form relates to the registration of a class of securities pursuant to
Section 12(b) of the Exchange Act and is effective pursuant to General
Instruction A.(c), please check the following box /X/
If this Form relates to the registration of a class of securities pursuant to
Section 12(g) of the Exchange Act and is effective pursuant to General
Instruction A.(d), please check the following box 0
SECURITIES ACT REGISTRATION STATEMENT FILE NUMBER TO WHICH THIS FORM
RELATES: NOT APPLICABLE.
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(B) OF THE ACT:
TITLE OF EACH CLASS NAME OF EACH EXCHANGE ON WHICH
TO BE SO REGISTERED EACH CLASS IS TO BE REGISTERED
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COMMON SHARES, PAR VALUE $.001 AMERICAN STOCK EXCHANGE
SECURITIES TO BE REGISTERED PURSUANT TO SECTION 12(G) OF THE ACT:
NONE.
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This Form 8-A/A amends and restates in its entirety our Form 8-A filed on
October 29, 1993.
ITEM 1. DESCRIPTION OF REGISTRANT'S SECURITIES TO BE REGISTERED
GENERAL
Under our Declaration of Trust, the interest of the shareholders is
divided into sixty five million shares of beneficial interest, $.001 par value
per share, which shall be known collectively as ("shares"). Currently,
59,200,000 shares are classified as common shares, $.001 par value per share,
800,000 shares are classified as Series A Convertible Preferred Stock, $.001 par
value per share (the "Series A Preferred Shares"), 4,200,000 shares are
classified as Series B Convertible Preferred Stock, $.001 par value (the "Series
B Preferred Shares") and 800,000 shares are classified as Series C Convertible
Preferred Stock, $.001 par value per share (the "Series C Preferred Shares").
The common shares are listed on the American Stock Exchange under the symbol
"KTR." Our board of trustees may classify and reclassify any unissued shares of
capital shares by setting or changing in any one or more respects the
preferences, conversion or other rights, voting powers, restrictions,
limitations as to dividends, qualifications or terms or conditions of redemption
of such shares of capital shares subject to the rights of the holders of Series
A, Series B and Series C Preferred Shares described below.
As general partner of our operating partnership, Keystone Operating
Partnership, L.P., we may authorize the creation of one or more series of
preferred OP Units having such preferences, conversion or other rights, voting
powers, restrictions, limitations as to dividends, qualifications or terms or
conditions of redemption of such OP Units as we may determine subject to the
rights of the holders of Series B, Series C and Series D Convertible Preferred
Units described below. We also may authorize the issuance of additional common
OP Units on such terms and conditions as we may determine.
The transfer agent and registrar for our common shares is American
Stock Transfer & Trust Company.
At the annual meeting of our shareholders held on June 3, 1999, our
shareholders approved our conversion from a Maryland corporation to a Maryland
real estate investment trust. This conversion was effected on October 13, 1999
through the merger of American Real Estate Investment Corporation, a Maryland
corporation, with and into Keystone Property Trust, a Maryland real estate
investment trust, formed solely for the purposes of this conversion.
COMMON SHARES
The holders of common shares are entitled to one vote per share on all
matters voted on by shareholders, including elections of trustees. Except for
the voting rights of the holders of Series A, Series B and Series C Preferred
Shares described below, rights provided in any Articles Supplementary adopted by
our board of trustees with respect to any future series of preferred shares or
as otherwise required by law, the holders of common shares possess all voting
power. Our board of trustees is divided into three classes. The three classes
have staggered terms of office so that the terms of office of trustees of only
one class expires at each annual meeting of shareholders. The trustees of each
class are elected for three year terms and until his or her successor is elected
and duly qualified or until his or her earlier death, resignation or removal.
Our Declaration of Trust does not provide for cumulative voting in the election
of trustees. Subject to any preferential rights of any outstanding series of
preferred shares including the Series A, Series B and Series C Preferred Shares,
the holders of shares of common shares are entitled to such dividends as may be
declared from time to time by our board of trustees from funds available
therefor and upon liquidation are entitled to receive pro rata all assets of our
company available for distribution to such holders. All shares of common shares
outstanding are fully paid and non-
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assessable, and the holders thereof have no preemptive rights under our
Declaration of Trust. However, under an agreement pursuant to which certain
institutional holders (for whom Morgan Stanley Asset Management Inc. acts as
agent) purchased common shares, if we propose to issue common shares for cash,
these institutional holders have the right to purchase, on the same terms, up to
an amount of the securities such that, upon consummation of the proposed
issuance, such holders would hold the same percentage of our common shares as
such holders held immediately prior to such issuance. Holders of our Series A
Preferred Shares have similar rights as described below under "Preferred
Shares--Terms of Series A Convertible Preferred Shares--Preemptive Rights"
below.
RESTRICTIONS ON TRANSFER
For us to qualify as a REIT under the Code, not more than 50% in value
of our outstanding shares may be owned, directly or indirectly, by five or fewer
individuals (as defined in the Code to include certain entities) during the last
half of a taxable year, and the shares of capital shares must be beneficially
owned by 100 or more persons during at least 335 days of a taxable year of 12
months or during a proportionate part of a shorter taxable year; and certain
percentages of our gross income must be from particular activities. Because our
trustees believe it is essential for us to continue to qualify as a REIT, the
Declaration of Trust, subject to certain exceptions, provides that no holder
(other than the McBride Family (as defined in the Declaration of Trust) and
Hudson Bay Partners II, L.P., and any other person who the trustees approve, at
their option and in their discretion, provided that such approval will not
result in the termination of our status as a REIT) may own, or be deemed to own
by virtue of the attribution provisions of the Code, more than the Ownership
Limit. In connection with certain issuances of our shares, our Board approved
the exemption of certain additional holders of our shares from the Ownership
Limit. The "Ownership Limit" means (i) with respect to our common shares, 4.9%
of the outstanding common shares (in value or number of shares, whichever is
more restrictive) and (ii) with respect to any class or series of preferred
shares, 9.9% (in value or number of shares, whichever is more restrictive) of
the outstanding such class or series of preferred shares. The foregoing
restrictions on transferability and ownership will not apply if the trustees
determine that it is no longer in our best interests to attempt to qualify, or
to continue to qualify, as a REIT. If any purported transfer of shares would
cause our shares to be beneficially owned by less than 100 persons, then such
purported transfer shall be void ab initio and the intended transferee shall
acquire no rights in such shares. If any transfer of shares occurs which, if
effected, would (i) create a direct or indirect ownership of shares in excess of
the Ownership Limit, (ii) result in our company being "closely held" within the
meaning of Section 856(h) of the Code, or (iii) otherwise result in our failure
to qualify as a REIT, then the capital shares being transferred that would cause
one or more of the restrictions on ownership or transfer to be violated will be
automatically transferred to a trust for the benefit of a designated charitable
beneficiary. The purported transferee of such shares shall have no right to
receive dividends or other distributions with respect to such shares and shall
have no right to vote such shares. Any dividends or other distributions paid to
such purported transferee prior to our discovery that the shares have been
transferred to a trust shall be paid upon demand to the trustee of the trust for
the benefit of the charitable beneficiary. The trustee of the trust will have
all rights to dividends with respect to the shares of capital shares held in
trust, which rights will be exercised for the exclusive benefit of the
charitable beneficiary. The trustee shall designate a transferee of such shares
so long as such shares of shares would not violate the Ownership Limit in the
hands of such designated transferee. Upon the sale of such shares, the purported
transferee shall receive the lesser of (A) (i) the price per share such
purported transferee paid for the capital shares in the purported transfer that
resulted in the transfer of shares of capital shares to the trust, or (ii) if
the transfer or other event that resulted in the transfer of shares of capital
shares gave full value for such shares, a price per share equal to the market
price on the date of the purported transfer or other event that resulted in the
transfer of the shares to the trust, and (B) the price per share received by the
trustee from the sale or disposition of the shares held in the trust.
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All certificates representing capital shares will bear a legend
referring to the restrictions described above.
Every owner of more than 1% (or such other percentage as required by
the Code or regulations thereunder) of the issued and outstanding shares of
Common shares will be required to file a written notice with us containing the
information specified in the Declaration of Trust no later than January 30 of
each year. In addition, each stockholder shall upon demand be required to
disclose to us in writing such information as we may request in good faith in
order to determine our status as a REIT.
These ownership limitations may have the effect of precluding
acquisition of control of our company unless the trustees determine that
maintenance of REIT status is no longer in our best interests.
In addition, our Board of Directors is divided into three classes, with
the members of each class serving a three-year term. The staggered terms for
directors may reduce the possibility of a tender offer or an attempt to affect a
change in control of our company, even if such a tender offer or change of
control would be in our stockholders' best interests.
LIMITATION OF LIABILITY OF TRUSTEES
The Declaration of Trust provides that, to the fullest extent permitted
by Maryland law, a Trustee or officer will not be personally liable for monetary
damages to us or you.
INDEMNIFICATION OF TRUSTEES AND OFFICERS
The Declaration of Trust provides that we shall indemnify (i) our
Trustees and officers to the fullest extent required or permitted by Maryland
law, including the advance of expenses under the procedures and to the full
extent permitted by law and (ii) other employees and agents to such extent as
shall be authorized by our Board or our By-laws and be permitted by law. The
Declaration of Trust provides that no amendment of the Declaration of Trust or
repeal of any of its provisions shall limit or eliminate the right to
indemnification provided thereunder with respect to acts or omissions occurring
prior to such amendment or repeal. We have a trustee and officer liability
insurance policy with a $5,000,000 limit of liability and a company retention of
$75,000 in the aggregate for each claim.
OTHER SECURITIES
Although this registration statement relates only to the common shares
described above, set forth below is a description of the Company's preferred
shares and our operating partnership's OP Units:
PREFERRED SHARES
Under our Declaration of Trust, our board of trustees is authorized to
provide for the issuance of preferred shares in one or more series, to establish
the number of shares in each series and to fix the terms of each series. Our
board of trustees could authorize the issuance of additional preferred shares
with terms and conditions that could have the effect of discouraging a takeover
or other transaction that holders of common shares might believe to be in their
best interests or in which holders of some, or a majority, of the common shares
might receive a premium for their shares over the then market price of such
common shares.
TERMS OF SERIES A CONVERTIBLE PREFERRED SHARES
We currently have 800,000 Shares classified as Series A Preferred
Shares issued and outstanding. The Series A Preferred Shares have the following
terms:
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VOTING RIGHTS. Except in certain limited circumstances and as required
by applicable law, holders of Series A Preferred Shares are not entitled to
vote. The affirmative vote or consent of the holders of at least two-thirds of
the votes entitled to be cast by holders of outstanding Series A Preferred
Shares is required to authorize or increase the number of shares of a class
senior to the Series A Preferred Shares or to authorize any amendment to our
Declaration of Trust that would materially and adversely affect the voting
powers, rights or privileges of the holders of the Series A Preferred Shares. If
and whenever dividends on any Series A Preferred Shares are in arrears for six
or more quarterly periods (whether or not consecutive), the number of trustees
then constituting our board of trustees shall be increased by one and the
holders of Series A Preferred Shares, voting as a single class, will be entitled
to nominate and vote for the election of the additional trustee.
DIVIDENDS. Holders of Series A Preferred Shares are entitled to
cumulative dividends, payable quarterly and in preference to dividends payable
on our common shares and any other shares ranking junior to the Series A
Preferred Shares, when, as and if declared by our board of trustees out of funds
legally available for that purpose, at the rate of the greater of (i) $2.25 per
share per year or (ii) an amount per share equal to the aggregate annual amount
of cash dividends paid or payable, if any, with respect to the number of shares
of common shares into which each Series A Preferred Share is then convertible.
Such dividends are cumulative from the date of issuance of the Series A
Preferred Shares and compound quarterly at a rate of 9% per annum.
LIQUIDATION. In the event of any (i) liquidation, dissolution or
winding-up of our affairs, (ii) consolidation or merger which results in a
change in control of our company, or (iii) sale or transfer of all or
substantially all of our assets other than to an affiliate (each a "Liquidation
Event"), the holders of Series A Preferred Shares will be entitled to receive,
out of our assets legally available for distribution to our shareholders, before
distributions are made to holders of our common shares or any other shares
ranking junior to the Series A Preferred Shares as to liquidating distributions,
the greater of (i) (A) a liquidation preference equal to the sum of $25.00 per
share and accrued and unpaid dividends plus (B) the applicable liquidation
premium set forth below, or (ii) an amount per share equal to the amount which
would have been payable had each share been converted into common shares
immediately prior to such liquidation, sale or merger. If, on or prior to
December 15, 2003, there is (i) a consolidation or merger which results in a
change of control of our company and in which the surviving entity is another
entity that is or may be an issuer of senior unsecured debt securities or
preferred stock rated investment grade and that has common equity securities
with an average daily trading volume of $2,475,000 over the prior 30 trading
days, the liquidation premium will be 5% of the liquidation preference or (ii)
any other Liquidation Event, the liquidation premium will be 10% of the
liquidation preference. If there is a Liquidation Event after December 15, 2003,
the liquidation premium will be equal to the redemption premium set forth in the
following paragraph.
REDEMPTION. We may not redeem Series A Preferred Shares prior to
December 15, 2003. On or after December 15, 2003, we may redeem for cash all,
but not less than all, of the outstanding Series A Preferred Shares at a price
per share equal to the liquidation preference (which is $25.00 per share) plus a
redemption premium as set forth in the following table:
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REDEMPTION PREMIUM
AS A PERCENTAGE OF
REDEMPTION DATE LIQUIDATION PREFERENCE
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From December 15, 2003
through and including December 14, 2004.......................... 4.5%
From December 15, 2004
through and including December 14, 2005.......................... 3.375%
From December 15, 2005
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through and including December 14, 2006.......................... 2.25%
From December 15, 2006
through and including December 14, 2007.......................... 1.125%
Thereafter......................................................... 0%
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CONVERSION. Each Series A Preferred Share is convertible at any time
into the number of common shares obtained by dividing the aggregate liquidation
preference (which is $25 per share) of such Series A Preferred Shares by $16.50.
The conversion price is subject to adjustment upon certain events such as a
combination or subdivision of our common shares, the issuance of rights, options
or warrants to holders of our common shares entitling them to purchase common
shares at a price less than their current market value or any action affecting
our common shares that in the opinion of our board of trustees would materially
adversely affect the conversion rights of the holders of Series A Preferred
Shares.
RIGHTS UPON CERTAIN TRANSACTIONS. We may not enter into certain
transactions in which our common shares are converted into the right to receive
securities or other property (including cash), unless each Series A Preferred
Share that is not redeemed or converted into the right to receive securities or
other property will be converted into the securities or other property that
would have been received if such Series A Preferred Shares were converted into
common shares immediately prior to the transaction. We may not agree to enter
into such a transaction unless provisions are made that enable holders of Series
A Preferred Shares that remain outstanding after the transaction to convert
their shares into the consideration received by holders of common shares at the
conversion price in effect immediately prior to the transaction. Furthermore, in
the event of a consolidation or merger with an unaffiliated entity in which our
company is not the surviving entity, the holders of Series A Preferred Shares
may require us to make provision for the Series A Preferred Shares in accordance
with the immediately preceding sentences unless we redeem all of the Series A
Preferred Shares for an amount equal to the liquidation preference, plus a
redemption premium of 10% of the liquidation preference.
PREEMPTIVE RIGHTS. If we propose to issue for cash either common shares
or securities convertible into common shares (with the exception of limited
partner interests in our operating partnership), we must give each holder of
Series A Preferred Shares the right to purchase, on the same terms, up to an
amount of our common shares or other securities issued so that, upon
consummation of the proposed issuance, such holder would hold the same
percentage of our common shares that it held immediately prior to the proposed
issuance (assuming conversion to common shares of all Series A Preferred Shares
held by such holder).
TERMS OF SERIES B CONVERTIBLE PREFERRED SHARES
The Series B Preferred Shares will have the following terms:
VOTING RIGHTS. Except in certain limited circumstances and as required
by applicable law, holders of Series B Preferred Shares are not entitled to
vote. The affirmative vote of at least two-thirds of the votes cast by holders
of outstanding Series B Preferred Shares is required to authorize or increase
the number of shares of another class ranking senior to the Series B Preferred
Shares or to authorize an amendment to our Declaration of Trust that would
materially and adversely affect the voting powers, rights or privileges of the
holders of the Series B Preferred Shares. If and whenever (i) dividends on any
Series B Preferred Shares are in arrears for six or more quarterly periods
(whether or not consecutive), (ii) we breach certain fixed charge coverage
ratios, (iii) our aggregate dividends declared or paid on our common shares and
preferred shares from the issue date of any Series B Preferred Shares exceeds
our cumulative funds from operations plus capital gains not included in our
funds from operation from such issue date or (iv) we breach any covenant granted
to holders of future series of our preferred shares that restricts the total
amount of our indebtedness and preferred shares to a specified percentage of the
value
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or our assets or real estate, the number of trustees then constituting our
board of trustees shall be increased by one and the holders of Series B
Preferred Shares, voting as a single class, will be entitled to nominate and
vote for the election of the additional trustee.
DIVIDENDS. Holders of Series B Preferred Shares are entitled to
cumulative dividends, payable quarterly and in preference to dividends payable
on our common shares, and any other shares ranking junior to the Series B
Preferred Shares, when, as and if declared by our board of trustees out of funds
legally available for that purpose, at the rate of $2.4375 per share per year
plus the amount by which cash dividends with respect to our common shares
exceeds a rate of $1.56 (subject to adjustment) per share per year. Such
dividends shall be cumulative from the date of issuance of the Series B
Preferred Shares and shall compound at a rate per annum equal to 9.75%.
LIQUIDATION. In the event of any (i) liquidation, dissolution or
winding-up of our affairs, (ii) consolidation or merger which results in a
change in control of our company, or (iii) sale or transfer of all or
substantially all of our assets other than to an affiliate (each a "Liquidation
Event"), the holders of Series B Preferred Shares will be entitled to receive,
out of our assets legally available for distribution to our shareholders, before
distributions are made to holders of our common shares or any other shares
ranking junior to the Series B Preferred Shares as to liquidation distributions,
the greater of (i) (A) a liquidation preference in an amount equal to the sum of
$25.00 per share and accrued and unpaid dividends plus (B) the applicable
liquidation premium set forth below, or (ii) an amount per share equal to the
amount which would have been payable had each share been converted into common
shares immediately prior to such Liquidation Event. If, on or prior to December
15, 2003, there is (i) a consolidation or merger which results in a change of
control of our company and in which the surviving entity is another entity that
is or may be the issuer of senior unsecured debt securities or preferred shares
rated investment grade, the liquidation premium will be 5% of the liquidation
preference or (ii) any other Liquidation Event, the liquidation premium will be
10% of the liquidation preference. If, after December 15, 2003, there is a
Liquidation Event the liquidation premium will be the same as the redemption
premium set forth in the following paragraph.
REDEMPTION. We may redeem for cash, at any time, all or part of the
outstanding Series B Preferred Shares. On or before the fifth anniversary of the
date of issuance of the shares we may redeem the shares for cash at a redemption
price per share equal to the amount necessary to produce a 17% internal rate of
return. After the fifth anniversary of the date of issuance, we may redeem for
cash the shares at a redemption price equal to the liquidation preference (which
is $25.00 per share) plus a redemption premium as set forth in the following
table:
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REDEMPTION PREMIUM
AS A PERCENTAGE OF
REDEMPTION DATE LIQUIDATION PREFERENCE
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From the fifth anniversary of the date of issuance
to and including the sixth anniversary of the date of issuance......... 4.825%
From the sixth anniversary of the date of issuance
to and including the seventh anniversary of the date of issuance....... 3.62%
From the seventh anniversary of the date of issuance
to and including the eighth anniversary of the date of issuance........ 2.41%
From the eighth anniversary of the date of issuance
to and including the ninth anniversary of the date of issuance......... 1.21%
Thereafter............................................................. 0%
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If we call less than all the Series B Preferred Shares for redemption, shares
will be redeemed pro rata on the basis of the number of shares owned. In the
event of a change in control in which the surviving entity does not have or may
not have senior unsecured indebtedness or preferred stock rated investment
grade, each holder of Series B Preferred Shares shall have the right to require
us to redeem all, but not less than all, outstanding Series B Preferred Shares
owned by such holder for an amount per share equal to the liquidation preference
plus a premium equal to 10% of the liquidation preference.
CONVERSION. Each holder of Series B Preferred Shares has the right, at
his or her option, at any time and from time to time, to convert such shares
into the number of common shares obtained by dividing the aggregate liquidation
preference of such Series B Preferred Shares by a conversion price of $16.00.
The conversion price is subject to adjustment upon certain events such as a
combination or subdivision of our common shares or any action affecting our
common shares that in the opinion of our board of trustees would materially
adversely affect the conversion rights of the holders of Series B Preferred
Shares.
TERMS OF SERIES C CONVERTIBLE PREFERRED SHARES
The Series C Preferred Shares have the following terms:
VOTING RIGHTS. Except in certain limited circumstance and as required
by applicable law, the Series C Preferred Shares are not entitled to vote. The
affirmative vote of at least two-thirds of the votes cast by the holders of the
Series C Preferred Shares is required to authorize or increase the number of
shares of a class senior to, or on parity with the Series C Preferred Shares or
to authorize an amendment to our Declaration of Trust that would materially and
adversely affect the voting powers, rights or privileges of the holders of the
Series C Preferred Shares.
DIVIDENDS. The holders of Series C Preferred Shares are entitled to
cumulative dividends, payable quarterly and in preference to dividends payable
on our common shares and any other shares ranking junior to the Series C
Preferred Shares, when, as and if authorized and declared by our board of
trustees out of funds legally available for that purpose, cumulative dividends
payable quarterly in cash at the rate of $2.4375 per share per year plus the
amount by which cash dividends with respect to one share of our common shares
exceeds a rate of $1.54 (subject to adjustment) per year multiplied by the
conversion ratio then in effect for the Series C Preferred Shares. Such
dividends shall be cumulative from the date of issuance of the Series C
Preferred Shares and compound quarterly at a rate of 9.75% per annum.
LIQUIDATION. In the event of any Liquidation Event, the holders of
Series C Preferred Shares will be entitled to receive, out of our assets legally
available for distribution to our shareholders, before distributions are made to
holders of our common shares or any other shares ranking junior to the Series C
Preferred Shares as to liquidation distributions, the greater of (i) (A) a
liquidation preference in an amount equal to the sum of $25.00 per share and
accrued and unpaid dividends plus (B) the applicable liquidation premium set
forth below, or (ii) an amount per share equal to the amount which would have
been payable had each share been converted into shares of common shares
immediately prior to such Liquidation Event. If, on or prior to December 15,
2003, there is (i) a consolidation or merger which results in a change of
control of our company and in which the surviving entity is another entity that
is or may be the issuer of senior unsecured debt securities or preferred stock
rated investment grade, the liquidation premium will be 5% of the liquidation
preference or (ii) any other Liquidation Event, the liquidation premium will be
10% of the liquidation preference. If, after December 15, 2003, there is a
Liquidation Event, the liquidation premium will be the same as the redemption
premium set forth in the following paragraph.
REDEMPTION. At any time following the fifth anniversary of the date of
issuance of the Series C Preferred Shares, we may redeem for cash all or part of
the outstanding Series C Preferred Shares at a
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price per share equal to the liquidation preference (which is $25.00 per share)
plus a redemption premium as set forth in the following table:
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REDEMPTION PREMIUM AS
A PERCENTAGE OF
REDEMPTION DATE LIQUIDATION PREFERENCE
--------------- ----------------------
<S> <C>
From the fifth anniversary of the date of issuance
to and including the sixth anniversary of the date of issuance....... 4.75%
From the sixth anniversary of the date of issuance
to and including the seventh anniversary of the date of issuance..... 3.5625%
From the seventh anniversary of the date of issuance
to and including the eighth anniversary of the date of issuance...... 2.375%
From the eighth anniversary of the date of issuance
to and including the ninth anniversary of the date of issuance......... 1.1875%
Thereafter............................................................. 0%
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If we call less than all of the outstanding Series C Preferred Shares for
redemption, shares will be redeemed pro rata in proportion to the number shares
owned.
CONVERSION. Each holder of Series C Preferred Shares may at any time
convert such shares into the number of our common shares obtained by dividing
the aggregate liquidation preference of such Series C Preferred Shares by a
conversion price of $15.75. The conversion price is subject to adjustment upon
certain events such as a combination or subdivision of our common shares, the
granting of rights, options or warrants to holders of our common shares
entitling them to purchase common shares at a price less than their current
market value or any action affecting our common shares that in the opinion of
our board of trustees would materially adversely affect the conversion rights of
the holders of Series C Preferred Shares.
OP UNITS
Our operating partnership has, common OP Units and six series of
convertible preferred OP Units outstanding (Series A, B, C, D, E and F) which
are convertible into our common shares. The following is a description of the
common OP Units and each series of preferred OP Units.
COMMON UNITS
Each common OP Unit may be converted by the holder into one common
share (subject to certain anti-dilution provisions), or in certain cases, at
our option, the cash value of one common share.
SERIES A CONVERTIBLE PREFERRED UNITS
We currently hold all of the outstanding Series A Convertible Preferred
Units. Each of these OP Units has a liquidation and dividend preference
identical to the preference of one Series A Convertible Preferred Share. Upon
the conversion or redemption of Series A Convertible Preferred Shares for common
shares, we are required to convert an equal number of Series A Convertible
Preferred Units into common OP Units.
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SERIES B CONVERTIBLE PREFERRED UNITS
The Series B Convertible Preferred Units have the following terms:
VOTING RIGHTS. Except in limited circumstances and as required by
applicable law, holders of Series B Convertible Preferred Units are not entitled
to vote. The affirmative vote of at least two-thirds of the votes cast by
holders of outstanding Series B Convertible Preferred Units is required to
authorize or increase the number of units of another class ranking senior to the
Series B Convertible Preferred Units or to authorize an amendment to the
operating partnership's partnership agreement that would materially and
adversely affect any power, preference or special right of the holders of the
Series B Convertible Preferred Units.
DISTRIBUTIONS. Holders of Series B Convertible Preferred Units are
entitled to cumulative cash distributions, payable quarterly and in preference
to cash distributions, payable on the operating partnership's common OP Units,
and any other units ranking on a parity with or junior to the Series B
Convertible Preferred Units, when, as and if declared by us, as general partner
of the operating partnership, out of net operating cash flow at a rate of $2.375
per unit per year. Such cash distributions are cumulative from the date of
issuance of the Series B Convertible Preferred Units and shall compound at a
rate per annum equal to 9.50%.
LIQUIDATION. In the event of any (a) dissolution or winding up of the
operating partnership or us or (b) a sale or transfer of all or substantially
all of the operating partnership's or our assets other than to an affiliate of
the operating partnership or us, the holders of the Series B Convertible
Preferred Units will be entitled to receive out of capital, surplus or earnings,
before distributions are made to the holders of any of the operating
partnership's common OP Units or any other units ranking junior to the Series B
Convertible Preferred Units as to liquidation distributions an amount equal to
$25.00 per Series B Convertible Preferred Unit and accrued and unpaid cash
distributions.
REDEMPTION. The operating partnership may redeem for cash all or part
of the outstanding Series B Convertible Preferred Units at a price per unit
equal to the liquidation preference (which is $25.00 per unit) plus accrued and
unpaid cash distributions. Upon notice from the operating partnership of its
intention to redeem the Series B Convertible Preferred Units, the holders of the
Series B Convertible Preferred Units shall be entitled to convert such Series B
Convertible Preferred Units into common shares as described in the following
paragraph.
CONVERSION. Each holder of Series B Convertible Preferred Units has the
right, at his or her option, at any time and from time to time, to convert such
units into the number of common shares based upon the conversion price. Based
upon the current conversion price, the holders of the Series B Convertible
Preferred Units are entitled to 454,545 common shares upon conversion. The
conversion price is subject to adjustment upon certain events such as a
combination or subdivision of our common shares.
SERIES C CONVERTIBLE PREFERRED UNITS
The Series C Convertible Preferred Units will have the following terms:
VOTING RIGHTS. Except in certain limited circumstances and as required
by applicable law, holders of Series C Convertible Preferred Units are not
entitled to vote. The affirmative vote of at least two-thirds of the votes cast
by holders of outstanding Series C Convertible Preferred Units is required to
authorize or increase the number of units of another class ranking senior to the
Series C Convertible Preferred Units or to authorize an amendment to the
operating partnership's partnership agreement that would materially and
adversely affect the voting powers, rights or privileges of the holders of the
Series C Convertible Preferred Units.
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DISTRIBUTIONS. Holders of Series C Convertible Preferred Units are
entitled to cumulative cash distributions, payable quarterly and in preference
to dividends payable on our common OP Units, and any other units ranking junior
to the Series C Convertible Preferred Units, when, as and if declared by us, as
general partner of the operating partnership, out of funds legally available for
that purpose, at the rate of $2.4375 per share per year plus the amount by which
cash dividends with respect to our common shares exceeds a rate of $1.56
(subject to adjustment) per share per year. Such dividends shall be cumulative
from the date of issuance of the Series C Convertible Preferred Units and shall
compound at a rate per annum equal to 9.75%.
LIQUIDATION. In the event of any Liquidation Event involving the
operating partnership or us, the holders of Series C Convertible Preferred Units
will be entitled to receive, out of our assets legally available for
distribution to our OP Unit holders, before distributions are made to holders of
our common OP Units or any other units ranking junior to the Series C
Convertible Preferred Units as to liquidation distributions, the greater of (i)
(A) a liquidation preference in an amount equal to the sum of $25.00 per unit
and accrued and unpaid cash distribution plus (B) the applicable liquidation
premium set forth below, or (ii) an amount per unit equal to the amount which
would have been payable had each unit been converted into of common shares
immediately prior to such Liquidation Event. If, on or prior to December 15,
2003, there is (i) a consolidation or merger which results in a change of
control of the operating partnership or us and in which the surviving entity is
another entity that is or may be the issuer of senior unsecured debt securities
or preferred stock rated investment grade, the liquidation premium will be 5% of
the liquidation preference or (ii) any other Liquidation Event, the liquidation
premium will be 10% of the liquidation preference. If, after December 15, 2003,
there is a Liquidation Event the liquidation premium will be the same as the
redemption premium set forth in the following paragraph.
REDEMPTION. At any time following the fifth anniversary of the date of
issuance of the Series C Convertible Preferred Units, the operating partnership
may redeem for cash or common OP Units (at the holder's option) all or part of
the outstanding Series C Convertible Preferred Units price per unit equal to the
liquidation preference (which is $25.00 per unit) plus a redemption premium as
set forth in the following table:
<TABLE>
<CAPTION>
REDEMPTION PREMIUM
AS A PERCENTAGE OF
REDEMPTION DATE LIQUIDATION PREFERENCE
--------------- ----------------------
<S> <C>
From the fifth anniversary of the date of issuance
to and including the sixth anniversary of the date of issuance......... 4.825%
From the sixth anniversary of the date of issuance
to and including the seventh anniversary of the date of issuance....... 3.62%
From the seventh anniversary of the date of issuance
to and including the eighth anniversary of the date of issuance........ 2.41%
From the eighth anniversary of the date of issuance
to and including the ninth anniversary of the date of issuance......... 1.21%
Thereafter............................................................. 0%
</TABLE>
If we call less than all the Series C Convertible Preferred Units for
redemption, units will be redeemed pro rata on the basis of the number of units
owned. In the event of a change in control in which the surviving entity does
not have or may not have senior unsecured indebtedness or preferred stock rated
investment grade, each holder of Series C Convertible Preferred Units shall have
the right to require us to redeem all, but not less than all, outstanding Series
C Convertible Preferred Units owned by such holder
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for an amount per unit equal to the liquidation preference plus a premium equal
to 10% of the liquidation preference.
In the event a holder of the Series C Convertible Preferred Units
elects to receive common OP Units, the holder will be entitled to receive the
amount of common OP Units equal to the liquidation preference divided by the
current market price of our common shares.
CONVERSION. Each holder of Series C Convertible Preferred Units has the
right, at his or her option, at any time and from time to time, to convert such
units into (a) the amount of cash obtained by multiplying the current market
price per share of our common shares by a fraction, the numerator of which is
the liquidation preference (which is $25.00 per unit) and the denominator of
which is the conversion price (which is $16.00 per unit), or, if the operating
partnership does not elect to give this cash payment, (b) at the election of the
holder, (1) the number of common shares obtained by dividing the liquidation
preference by the conversion price or (2) the number of Series B Preferred
Shares identical to the number of Series C Convertible Preferred Units being
converted. The conversion price is subject to adjustment upon certain events
such as a combination or subdivision of our common shares or any action
affecting our common shares that in our opinion would materially adversely
affect the conversion rights of the holders of Series C Convertible Preferred
Units.
SERIES D CONVERTIBLE PREFERRED UNITS
The Series D Convertible Preferred Units have the following terms:
VOTING RIGHTS. Except in certain limited circumstances and as required
by applicable law, holders of Series D Convertible Preferred Units are not
entitled to vote. The affirmative vote of at least two-thirds of the votes cast
by the holders of outstanding Series D Convertible Preferred Units is required
to authorize or increase the number of units of another class ranking senior to
the Series D Convertible Preferred Units or to authorize an amendment to the
operating partnership's partnership agreement that would materially and
adversely affect any power, preference or special right of the holders of the
Series D Convertible Preferred Unit.
DISTRIBUTIONS. Holders of Series D Convertible Preferred Units are
entitled to cumulative cash distributions, payable quarterly and in preference
to cash distributions on the operating partnership's common OP Units and any
other units ranking junior to the Series D Convertible Preferred Units, when, as
and if declared by us, in our capacity as general partner of the operating
partnership, out of funds legally available for that purpose, at the rate of the
greater of (a) $2.25 per unit per year or (b) an amount per unit equal to the
aggregate annual amount of cash dividends paid or payable, if any, with respect
to that number of common shares into which each Series D Convertible Preferred
Unit is then convertible. However, on and after the ten year anniversary of the
date of issuance of the Series D Convertible Preferred Units, the holders of the
Series D Convertible Preferred Units shall be entitled to receive a cash
distribution in an amount equal to the greater of (x) $4.50 per unit per year or
(y) an amount per unit equal to the aggregate annual amount of cash dividends
paid or payable, if any, with respect to that number of common shares into which
each Series D Convertible Preferred Unit is then convertible. Such cash
distributions shall be cumulative from the date of issuance of the Series D
Convertible Preferred Units and compound quarterly at a rate per annum equal to
(1) on or prior to the tenth anniversary of the date of issuance of the Series D
Convertible Preferred Units, 9% or (2) after the tenth anniversary of date of
issuance of the Series D Convertible Preferred Units, 18%.
LIQUIDATION. In the event of any (a) dissolution or winding up of the
operating partnership or us or (b) sale or transfer of all or substantially all
of the operating partnership's or our assets other than to an affiliate of
either the operating partnership or us or (c) a consolidation or merger of the
operating partnership or us with and into one or more entities which are not
affiliates of the operating partnership or us which could result in a change in
control, the holders of the Series D Convertible Preferred Units will
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be entitled to receive out of capital, surplus or earnings, before distributions
are made to the holders of any of the operating partnership's common OP Units or
any other units ranking junior to the Series D Convertible Preferred Units as to
liquidation distributions an amount equal to the greater of (i)(a) a liquidation
preference in an amount equal to the sum of $25.00 per unit and accrued and
unpaid cash distributions plus (b) the applicable liquidation premium set forth
below, or (ii) an amount per unit equal to the amount which would have been
payable had each Series D Convertible Preferred Unit been converted into common
shares immediately prior to such liquidation, sale or merger. The liquidation
premium referenced above shall mean (x) on or prior to the fifth anniversary of
the date of the issuance of the Series D Convertible Preferred Units, an amount
equal to 10% of the liquidation preference, or (y) after the fifth anniversary
of the date of the issuance of the Series D Convertible Preferred Units, an
amount equal to the redemption premium which will be payable on the Series D
Convertible Preferred Units if such units were called for redemption by us, as
general partner of the Operating partnership.
REDEMPTION. At any time following the fifth anniversary of the date of
issuance of the Series D Convertible Preferred Units, the operating partnership
may redeem for cash all, but not less than all, of the outstanding Series D
Convertible Preferred Units at a price per unit equal to the liquidation
preference (which is $25.00 per unit) plus a redemption premium as set forth in
the following table:
<TABLE>
<CAPTION>
REDEMPTION PREMIUM
AS A PERCENTAGE OF
REDEMPTION DATE LIQUIDATION PREFERENCE
--------------- ----------------------
<S> <C>
From the fifth anniversary of the date of issuance
to and including the sixth anniversary of the date of issuance......... 4.5%
From the sixth anniversary of the date of issuance
to and including the seventh anniversary of the date of issuance....... 3.375%
From the seventh anniversary of the date of issuance
to and including the eighth anniversary of the date of issuance........ 2.25%
Thereafter............................................................. 0%
</TABLE>
CONVERSION. Each Series D Convertible Preferred Unit is convertible at
any time at the election of the holder into (i) cash, or if the operating
partnership does not elect to give cash, (ii) the number of common shares or the
operating partnership's common OP Units (at such holder's election) obtained by
multiplying the current market price per common share by a fraction, the
numerator of which is the aggregate liquidation preference (which is $25.00 per
unit) and the denominator of which is the conversion price (which is $16.50 per
unit). The conversion price is subject to adjustment upon certain events such as
the combination or subdivision of our Common shares or the issuance by us of
certain rights, options or warrants to all holders of our common shares under
certain circumstances.
SERIES E CONVERTIBLE PREFERRED UNITS
We currently hold all of the outstanding Series E Convertible Preferred
Units. Each of these OP Units has a liquidation and dividend preference
identical to the preference of one Series C Convertible Preferred Share. Upon
the conversion or redemption of Series C Convertible Preferred Shares for common
shares, we will be required to convert an equal number of Series E Convertible
Preferred Units for common OP Units.
SERIES F CONVERTIBLE PREFERRED UNITS
We currently hold all of the outstanding Series F Convertible Preferred
Units. Each of these OP Units has a liquidation and dividend preference
identical to the preference of one Series C Convertible
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<PAGE>
Preferred Share. Upon the conversion or redemption of shares of Series C
Convertible Preferred Shares for common shares, we will be required to convert
and equal number of Series F Convertible Preferred Units for common OP Units.
ITEM 2. EXHIBITS
Not applicable.
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SIGNATURE
Pursuant to the requirements of Section 12 of the Securities Exchange
Act of 1934, the Registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereto duly authorized.
Keystone Property Trust
October 13, 1999 By: /s/ Timothy A. Peterson
----------------------------
Name: Timothy A. Peterson
Title: Secretary
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