SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): November 12, 1998
STORAGE USA, INC.
(Exact name of registrant as specified in charter)
Tennessee 001-12910 62-1251239
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(State or other (Commission (IRS Employer
jurisdiction of File Number) Identification No.)
incorporation)
165 Madison Avenue, Suite 1300
Memphis, Tennessee 38103
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (901) 252-2000
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Not Applicable
(Former name or former address, if changed since last report)
Exhibit Index appears on Page 4.
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INFORMATION TO BE INCLUDED IN REPORT
Item 5. Other Events.
On November 12, 1998, SUSA Partnership, L.P., the Registrant's
operating subsidiary (the "Partnership"), privately placed $65 million of 8 7/8%
Series A Cumulative Redeemable Preferred Partnership Units (the "Units") of the
Partnership. The Partnership has the right to redeem the Units after November 1,
2003 at the original capital contribution plus the cumulative priority return to
the redemption date, to the extent not previously distributed. The Units are
exchangeable, on a one-for-one basis, for shares of the Registrant's 8 7/8%
Series A Cumulative Redeemable Preferred Stock on or after November 1, 2008 (or
earlier upon the occurrence of certain events) at the option of 51% of the
holders of the Units.
Additional information with respect to the transaction described herein
is set forth in the exhibits hereto, which are incorporated herein by reference.
Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
a) Financial Statements.
None
b) Pro Forma Financial Information.
None
c) Exhibits.
Number Exhibit
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3.1 Articles of Amendment to the Amended
Charter of Storage USA, Inc.,
designating and fixing the rights
and preferences of the 8 7/8% Series
A Cumulative Redeemable Preferred
Stock, as filed with the Secretary
of State of the State of Tennessee
on November 12, 1998.
10.1 Fourth Amendment to the Second
Amended and Restated Agreement of
Limited Partnership of SUSA
Partnership, L.P., dated November
12, 1998, establishing the 8 7/8%
Series A Cumulative Redeemable
Preferred Units of Partnership
Interest and fixing distribution and
other preferences and rights of such
units.
10.2 Registration Rights Agreement, dated
as of November 12, 1998, by and
between Storage USA, Inc. and Greene
Street 1998 Exchange Fund, L.P.
2
<PAGE>
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
STORAGE USA, INC.
Date: November 20, 1998 By: /s/ John W. McConomy
-------------------------------------
John W. McConomy
Executive Vice President and General
Counsel
3
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EXHIBIT INDEX
Number Exhibit
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3.1 Articles of Amendment to the Amended Charter of
Storage USA, Inc., designating and fixing the
rights and preferences of the 8 7/8% Series A
Cumulative Redeemable Preferred Stock, as filed
with the Secretary of State of the State of
Tennessee on November 12, 1998.
10.1 Fourth Amendment to the Second Amended and
Restated Agreement of Limited Partnership of
SUSA Partnership, L.P., dated November 12,
1998, establishing the 8 7/8% Series A
Cumulative Redeemable Preferred Units of
Partnership Interest and fixing distribution
and other preferences and rights of such units.
10.2 Registration Rights Agreement, dated as of
November 12, 1998, by and between Storage USA,
Inc. and Greene Street 1998 Exchange Fund, L.P.
4
Exhibit 3.1
STORAGE USA, INC.
ARTICLES OF AMENDMENT TO THE AMENDED CHARTER
DESIGNATING AND FIXING THE RIGHTS AND
PREFERENCES OF A SERIES OF SHARES OF PREFERRED STOCK
Pursuant to the provisions of Section 48-20-106 of the Tennessee
Business Corporation Act, the undersigned corporation (the "Corporation") hereby
adopts the following Articles of Amendment to its Amended Charter:
FIRST: The name of the corporation is Storage USA, Inc.
SECOND: Pursuant to the authority expressly vested in the Board of
Directors of the Corporation by Section 6.1 of the Corporation's Amended Charter
(the "Charter") and Section 48-16-102 of the Tennessee Code Annotated, the Board
of Directors has, by resolution, duly divided and classified 650,000 shares of
the preferred stock of the Company into a series designated 8 7/8% Series A
Cumulative Redeemable Preferred Stock ( the "Series A Preferred Stock") and has
provided for the issuance of the Series A Preferred Stock.
THIRD: Section 6.1 is hereby amended by adding the following:
8 7/8% Series A Cumulative Redeemable Preferred Stock.
(a) Designation and Number. A series of Preferred Stock designated as the 8 7/8%
Series A Cumulative Redeemable Preferred Stock (the "Series A Preferred Stock")
is hereby established. The number of shares of Series A Preferred Stock shall be
650,000.
(b) Definitions. For purposes of the Series A Preferred Stock, the following
terms shall have the meanings indicated:
"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, New York are authorized or required by law, regulation or executive order
to close.
"Priority Return" shall mean the cumulative preferential cash distributions with
respect to the Series A Preferred Stock set forth in Section 4.02(e)(iii).
(c) Distributions.
A. Payment of Distributions. Holders of Series A Preferred Stock will
be entitled to receive, when, as and if declared by the Board of Directors (or a
duly authorized committee thereof), out of funds legally available for the
payment of dividends, cumulative preferential cash distributions at the rate per
annum of $8.78 per share of Series A Preferred Stock. Such distributions shall
be cumulative, shall accrue from the original date of issuance and will be
payable quarterly in arrears, on January 15, April 15, July 15 and October 15 of
each year (each a "Series A Preferred Stock Distribution Payment Date"). The
amount of the distribution payable for any period will be prorated and computed
on the basis of a 360-day year of twelve 30-day months and for any period
shorter than a full quarterly period for which distributions are computed, the
amount of the distribution payable will be computed on the basis of the actual
number of days elapsed in such a 30-day month. If any date on which
distributions are to be made on the Series A Preferred Stock is not a Business
Day, then payment of the distribution to be made on such date will be made on
the next succeeding day that is a Business Day (and without any interest or
other payment in respect of any such delay) except that, if such Business Day is
in the next succeeding calendar year, such payment shall be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date. Distributions on the Series A Preferred Stock will be
made to the holders of record of shares of the Series A Preferred Stock on the
relevant record dates, which will be fifteen (15) days prior to the relevant
Series A Preferred Stock Distribution Payment Date.
B. Distributions Cumulative. Notwithstanding the foregoing,
distributions on shares of the Series A Preferred Stock will accrue whether or
not the terms and provisions of any agreement of the Corporation at any time
prohibit the current payment of distributions, whether or not the Corporation
has earnings, whether or not there are funds legally available for the payment
of such distributions and whether or not such distributions are authorized.
Accrued but unpaid distributions on the Series A Preferred Stock will accumulate
as of the Series A Preferred Stock Distribution Payment Date on which they first
become payable. Accumulated and unpaid distributions will not bear interest.
C. Priority as to Distributions.
1. So long as any shares of Series A Preferred Stock are
outstanding, no distribution of cash or other property shall be authorized,
declared, paid or set apart for payment on or with respect to any class or
series of capital stock ranking junior as to the payment of distributions to the
shares of Series A Preferred Stock (collectively, "Junior Stock"), nor shall any
cash or other property be set aside for or applied to the purchase, redemption
or other acquisition for consideration of any shares of Series A Preferred Stock
or any Junior Stock, unless, in each case, all distributions accumulated on all
shares of Series A Preferred Stock have been paid in full.
2. So long as distributions have not been paid in full (or a
sum sufficient for such full payment is not so set apart) upon shares of the
Series A Preferred Stock, all distributions authorized and declared on shares of
the Series A Preferred Stock shall be authorized and declared so that the amount
of distributions authorized and declared per share of Series A Preferred Stock
shall in all cases bear to each other the same ratio that accrued distributions
per share of Series A Preferred Stock bear to each other.
D. No Further Rights. Holders of shares of Series A Preferred Stock
shall not be entitled to any distributions, whether payable in cash, other
property or otherwise, in excess of the full cumulative distributions described
herein.
(d) Liquidation Proceeds
A. Distribution. Upon voluntary or involuntary liquidation, dissolution
or winding-up of the Corporation, holders of shares of Series A Preferred Stock
shall be entitled to be paid out of the assets of the Corporation legally
available for distribution to its shareholders a liquidation preference of
$100.00 per share, plus an amount equal to any accrued and unpaid dividends to
the date of payment, but without interest, before any distribution of assets is
made to holders of any other class or series of capital stock of the Corporation
that ranks junior to the Series A Preferred Stock as to liquidation rights.
B. Notice. Written notice of any such voluntary or involuntary
liquidation, dissolution or winding-up of the Corporation, stating the payment
date or dates when, and the place or places where, the amounts distributable in
such circumstances shall be payable, shall be given by (1) fax and (2) first
class mail, postage pre-paid, not less than 30 and not more that 60 days prior
to the payment date stated therein, to each record holder of shares of Series A
Preferred Stock at the respective addresses of such holders as the same shall
appear on the transfer records of the Corporation.
C. No Further Rights. After payment of the full amount of the
Liquidation Preference, the holders of shares of Series A Preferred Stock will
have no right or claim to any of the remaining assets of the Corporation.
D. Consolidation, Merger or Certain Other Transactions. The
consolidation or merger or other business combination of the Corporation with or
into any corporation, trust or other entity (or of any corporation, trust or
other entity with or into the Corporation) shall not be deemed to constitute a
liquidation, dissolution or winding-up of the Corporation.
(e) Optional Redemption.
A. Right of Optional Redemption. The Series A Preferred Stock may not
be redeemed prior to November 1, 2003. On or after such date, the Corporation
shall have the right to redeem the Series A Preferred Stock, in whole or in
part, at any time or from time to time out of funds legally available therefor,
upon not less than 30 nor more than 60 days' written notice, at a redemption
price, payable in cash, equal to $100.00, plus accumulated and unpaid dividends
to the redemption date (the "Redemption Price"). If fewer than all of the
outstanding shares of Series A Preferred Stock are to be redeemed, the shares of
Series A Preferred Stock to be redeemed shall be selected pro rata (as nearly as
practicable without creating fractional shares).
B. Limitation on Redemption. The Corporation may not redeem fewer than
all of the outstanding shares of Series A Preferred Stock unless all accumulated
and unpaid distributions have been paid on all shares of Series A Preferred
Stock for all quarterly distribution periods terminating on or prior to the date
of redemption, unless such redemption is pursuant to a purchase or exchange
offer made on the same terms to all holders of Series A Preferred Stock.
C. Procedures for Redemption.
1. Notice of redemption will be (i) faxed, and (ii) mailed by
the Corporation, by certified mail, 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 shares of Series A Preferred Stock at their respective
addresses as they appear on the records of the Corporation. No failure to give
or defect in such notice shall affect the validity of the proceedings for the
redemption of any shares of Series A Preferred Stock except as to the holder to
whom such notice was defective or not given. In addition to any information
required by law, each such notice shall state: (u) the redemption date, (v) the
Redemption Price, (w) the aggregate number of Series A Preferred Stock to be
redeemed and, if fewer than all of the outstanding shares of Series A Preferred
Stock are to be redeemed, the number of shares of Series A Preferred Stock to be
redeemed held by such holder, which number shall equal such holder's pro rata
share (based on the percentage of the aggregate number of outstanding shares of
Series A Preferred Stock that the total number of shares of Series A Preferred
Stock held by such holder represents) of the aggregate number of shares of
Series A Preferred Stock to be redeemed, (x) the place or places where such
shares of Series A Preferred Stock are to be surrendered for payment of the
Redemption Price, (y) that distributions on the shares of Series A Preferred
Stock to be redeemed will cease to accumulate on such redemption date and (z)
that payment of the Redemption Price will be made upon presentation and
surrender of such shares of Series A Preferred Stock.
2. If the Corporation gives a notice of redemption in respect
of shares of Series A Preferred Stock (which notice will be irrevocable) then,
by 12:00 noon, New York City time, on the redemption date, the Corporation will
deposit irrevocably in trust for the benefit of the shares of Series A Preferred
Stock being redeemed funds sufficient to pay the applicable Redemption Price and
will give irrevocable instructions and authority to pay such Redemption Price to
the holders of the shares of Series A Preferred Stock upon surrender of the
shares of Series A Preferred Stock by such holders at the place designated in
the notice of redemption. On and after the date of redemption, distributions
will cease to accumulate on the shares of Series A Preferred Stock or portions
thereof called for redemption, unless the Corporation defaults in the payment
thereof. If any date fixed for redemption of shares of Series A Preferred Stock
is not a Business Day, then payment of the Redemption Price payable on such date
will be made on the next succeeding day that is a Business Day (and without any
interest or other payment in respect of any such delay) except that, if such
Business Day falls in the next calendar year, such payment will be made on the
immediately preceding Business Day, in each case with the same force and effect
as if made on such date fixed for redemption. If payment of the Redemption Price
is improperly withheld or refused and not paid by the Corporation, distributions
on such shares of Series A Preferred Stock will continue to accumulate from the
original redemption date to the date of payment, in which case the actual
payment date will be considered the date fixed for redemption for purposes of
calculating the applicable Redemption Price.
(f) Voting Rights.
A. General. Holders of shares of Series A Preferred Stock will not have
any voting rights or right to consent to any matter requiring the consent or
approval of holders of the Corporation's common stock, except as set forth
below.
B. Certain Voting Rights. So long as any shares of Series A Preferred
Stock remain outstanding, the Corporation shall not, without the affirmative
vote of the holders of at least two-thirds of the shares of Series A Preferred
Stock outstanding at the time (1) authorize or create, or increase the
authorized or issued amount of, any class or series of capital stock ranking
prior to the Series A Preferred Stock with respect to payment of distributions
or rights upon liquidation, dissolution or winding-up, or reclassify any capital
stock of the Corporation into any such capital stock, or create, authorize or
issue any obligations or security convertible into or evidencing the right to
purchase any such capital stock, (2) authorize or create, or increase the
authorized or issued amount of any capital stock on a parity with the Series A
Preferred Stock or reclassify any capital stock of the Corporation into any such
capital stock or create, authorize or issue any obligation or security
convertible into or evidencing the right to purchase any such capital stock, if
such capital stock or right to purchase capital stock is issued to any affiliate
of the Corporation, other than any issuance to (i) Security Capital U.S. Realty,
Security Capital Holdings, S.A. or any of their affiliates or to (ii) any other
affiliate, provided that a majority of Independent Directors of the Company (as
defined in the Charter) has approved such issuance, or (3) either consolidate,
merge into or with, or convey, transfer or lease its assets substantially as an
entirety to, any corporation or other entity, or amend, alter or repeal the
provisions of the Charter (including, without limitation, this Section), whether
by merger, consolidation or otherwise, in each case in a manner that would
materially and adversely affect the powers, special rights, preferences,
privileges or voting power of the shares of Series A Preferred Stock or the
holders thereof; provided, however, that with respect to the occurrence of any
event set forth in (3) above, so long as the Corporation is the surviving entity
and the Series A Preferred Stock remain outstanding with the terms thereof
unchanged, then the occurrence of any such event shall not be deemed to
materially and adversely affect such rights, privileges or voting powers of the
holders of the Series A Preferred Stock; and provided further, that any increase
in the amount of capital stock or the creation or issuance of any other class or
series of capital stock, in each case ranking (i) junior to the Series A
Preferred Stock with respect to payment of distributions or the distribution of
assets upon liquidation, dissolution or winding-up, or (ii) on a parity to the
Series A Preferred Stock with respect to payment of distributions or the
distribution of assets upon liquidation, dissolution or winding-up to the extent
such capital stock is not issued to an affiliate of the Corporation, other than
any such issuances (i) to Security Capital U.S. Realty, Security Capital
Holdings, S.A. or any of their affiliates or (ii) to any other affiliate,
provided that a majority of the Independent Directors of the Company have
approved such creation or issuance, shall not be deemed to materially and
adversely affect such rights, preferences, privileges or voting powers.
(g) Conversion. The Series A Preferred Stock is not convertible into or
exchangeable for any other property or securities of the Corporation.
(h) No Sinking Fund. No sinking fund shall be established for the retirement or
redemption of Series A Preferred Stock.
FOURTH: This Designating Amendment shall be effective at the time the
Tennessee Secretary of State accepts this Designating Amendment for filing.
FIFTH: The foregoing amendment was duly adopted by unanimous consent of
the Board of Directors without shareholder action, such shareholder action not
being required, on November 11, 1998.
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IN WITNESS WHEREOF, STORAGE USA, INC. has caused these presents to be
signed in its name and on its behalf by its Executive Vice President and General
Counsel on this the 11th day of November, 1998.
STORAGE USA, INC.
By: /s/ John W. McConomy
Name: John W. McConomy
Title: Executive Vice President and
General Counsel
Exhibit 10.1
SUSA PARTNERSHIP, L.P.
Fourth Amendment to the Second Amended and
Restated Agreement of Limited Partnership of
SUSA Partnership, L.P.
Establishing the 8 7/8% Series A Cumulative
Redeemable Preferred Units of Partnership
Interest and Fixing Distribution and
Other Preferences and Rights of Such Units
RECITALS
WHEREAS, The Board of Directors of Storage USA, Inc., a Tennessee
corporation and sole general partner (the "General Partner") of SUSA
Partnership, L.P. (the "Partnership") has adopted a resolution designating and
classifying 650,000 unissued and unclassified shares of preferred stock of the
General Partner as 8 7/8% Series A Cumulative Redeemable Preferred Stock (the
"Series A Preferred Stock"); and
WHEREAS, Pursuant to Section 4.02 and Article XI of the Second Amended
and Restated Agreement of Limited Partnership (the "Agreement") of the
Partnership, the General Partner desires to amend the Agreement to establish the
8 7/8% Series A Cumulative Redeemable Preferred Units of Partnership Interest
(the "Series A Preferred Units") with economic interests substantially similar
to those of the Series A Preferred Stock.
NOW, THEREFORE, the General Partner hereby adopts the following
amendment to the Agreement:
Article I of the Agreement is hereby amended by inserting in the
logical alphabetical locations the following definitions of Common Units, Greene
Street, Non-Greene Street Partners, Preferred Units and Series A Preferred Units
as follows:
"Common Units" shall mean all Partnership Interests that are not
specifically designated as Preferred Units pursuant to Section 4.02(a).
"Greene Street" shall mean Greene Street 1998 Exchange Fund, L.P., a
Delaware limited partnership.
"Non-Greene Street Partners" shall mean all of the Partners other than
Greene Street.
"Preferred Units" shall mean all Preferred Partnership Interests
designated and issued by the General Partner from time to time in accordance
with the provisions of Section 4.02(a).
"Series A Preferred Units" shall mean the 8 7/8% Series A Cumulative
Redeemable Preferred Units of Partnership Interests with the designations,
preferences, privileges, limitations and relative rights set forth in Section
4.02(e) hereof.
Article I, Section (vii) of the definition of "Profits" and "Losses" is
hereby restated in its entirety as follows:
(vii) Notwithstanding any other provision herein, any items which are
specially allocated pursuant to Sections 5.01(a)(i), 5.01(b) or 5.01(c)
shall not be taken into account in computing Profits or Losses.
Article IV of the Agreement is hereby amended by adding Section
4.02(e), as follows:
(e) Series A Cumulative Redeemable Preferred Units of Partnership Interest.
(i) Designation and Number. A series of Partnership Units in the
Partnership designated as the 8 7/8% Series A Cumulative Redeemable Preferred
Units (the "Series A Preferred Units") is hereby established. The number of
Series A Preferred Units shall be 650,000.
(ii) Definitions. For purposes of the Series A Preferred Units, the
following terms shall have the meanings indicated:
"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, New York are authorized
or required by law, regulation or executive order to close.
"Contributor" shall mean Greene Street 1998 Exchange Fund,
L.P., a Delaware limited partnership.
"Priority Return" shall mean the cumulative preferential cash
distributions with respect to the Series A Preferred Units set
forth in Section 4.02(e)(iii).
(iii) Distributions.
A. Payment of Distributions. Holders of Series A Preferred Units will
be entitled to receive, when, as and if declared by the Partnership acting
through the General Partner, out of Distributable Cash, cumulative preferential
cash distributions at the rate per annum of 8 7/8% of the original Capital
Contribution per Series A Preferred Unit. Such distributions shall be
cumulative, shall accrue from the original date of issuance and will be payable
(1) quarterly in arrears, on or before January 15, April 15, July 15 and October
15 of each year and, (2), in the event of (a) an exchange of Series A Preferred
Units into Series A Preferred Stock, or (b) a redemption of Series A Preferred
Units, on the exchange date or redemption date, as applicable (each a "Series A
Preferred Unit Distribution Payment Date"), commencing on the first of such
payment dates to occur following their original date of issuance. The amount of
the distribution payable for any period will be computed on the basis of a
360-day year of twelve 30-day months and for any period shorter than a full
quarterly period for which distributions are computed, the amount of the
distribution payable will be computed on the basis of the actual number of days
elapsed in such a 30-day month. If any date on which distributions are to be
made on the Series A Preferred Units is not a Business Day (as defined herein),
then payment of the distribution to be made on such date will be made on the
next succeeding day that is a Business Day (and without any interest or other
payment in respect of any such delay) except that, if such Business Day is in
the next succeeding calendar year, such payment shall be made on the immediately
preceding Business Day, in each case with the same force and effect as if made
on such date. Distributions on the Series A Preferred Units will be made to the
holders of record of the Series A Preferred Units on the relevant record dates,
which will be fifteen (15) days prior to the relevant Series A Preferred Unit
Distribution Payment Date.
B. Distributions Cumulative. Notwithstanding the foregoing,
distributions on the Series A Preferred Units will accrue whether or not the
terms and provisions of any agreement of the Partnership at any time prohibit
the current payment of distributions, whether or not the Partnership has
earnings, whether or not there are funds legally available for the payment of
such distributions and whether or not such distributions are authorized. Accrued
but unpaid distributions on the Series A Preferred Units will accumulate as of
the Series A Preferred Unit Distribution Payment Date on which they first become
payable. Accumulated and unpaid distributions will not bear interest.
C. Priority as to Distributions.
1. So long as any Series A Preferred Units are outstanding, no
distribution of cash or other property shall be authorized, declared, paid or
set apart for payment on or with respect to any class or series of Partnership
Interest of the Partnership ranking junior as to the payment of distributions to
the Series A Preferred Units (collectively, "Junior Units"), nor shall any cash
or other property (other than capital stock of the General Partner which
corresponds in ranking to the Partnership Interests being acquired) be set aside
for or applied to the purchase, redemption or other acquisition for
consideration of any Series A Preferred Units or any Junior Units, unless, in
each case, all distributions accumulated on all Series A Preferred Units have
been paid in full.
2. So long as distributions have not been paid in full (or a
sum sufficient for such full payment is not so set apart) upon the Series A
Preferred Units, all distributions authorized and declared on the Series A
Preferred Units shall be authorized and declared so that the amount of
distributions authorized and declared per Series A Preferred Unit shall in all
cases bear to each other the same ratio that accrued distributions per Series A
Preferred Unit bear to each other.
3. Notwithstanding anything to the contrary set forth herein,
distributions on Partnership Interests held by the General Partner ranking
junior to or on parity with the Series A Preferred Units may be made, without
preserving the priority of distributions described in Sections (iii).C.(1) and
(2), but only to the extent such distributions are required to preserve the real
estate investment trust status of the General Partner.
D. No Further Rights. Holders of Series A Preferred Units shall not be
entitled to any distributions, whether payable in cash, other property or
otherwise, in excess of the full cumulative distributions described herein.
(iv). Liquidation Proceeds
A. Distribution. Upon voluntary or involuntary liquidation, dissolution
or winding-up of the Partnership, distributions on the Series A Preferred Units
shall be made in accordance with Section 5.03 of the Agreement, provided, that
the remaining assets of the Partnership shall be distributed to the holders of
Series A Preferred Units until their Capital Account balances are reduced to
zero before any distribution is made to the holders of any series of Junior
Units or to the holders of Common Units.
B. Notice. Written notice of any such voluntary or involuntary
liquidation, dissolution or winding-up of the Partnership, stating the payment
date or dates when, and the place or places where, the amounts distributable in
such circumstances shall be payable, shall be given by (1) fax and (2) first
class mail, postage pre-paid, not less than 30 and not more that 60 days prior
to the payment date stated therein, to each record holder of the Series A
Preferred Units at the respective addresses of such holders as the same shall
appear on the transfer records of the Partnership.
C. No Further Rights. After payment of the full amount of the
liquidating distributions to which they are entitled, the holders of Series A
Preferred Units will have no right or claim to any of the remaining assets of
the Partnership.
D. Consolidation, Merger or Certain Other Transactions. The
consolidation or merger or other business combination of the Partnership with or
into any corporation, trust or other entity (or of any corporation, trust or
other entity with or into the Partnership) shall not be deemed to constitute a
liquidation, dissolution or winding-up of the Partnership.
(v). Optional Redemption.
A. Right of Optional Redemption. The Series A Preferred Units may not
be redeemed prior to November 1, 2003. On or after such date, the Partnership
shall have the right to redeem the Series A Preferred Units, in whole or in
part, at any time or from time to time out of funds legally available therefor,
upon not less than 30 nor more than 60 days' written notice, at a redemption
price, payable in cash, equal to the Capital Account balance of the holder of
Series A Preferred Units (the "Redemption Price"); provided, however, that no
redemption pursuant to this Section 4.02(e)(v) will be permitted if the
Redemption Price does not equal or exceed the original Capital Contribution of
such holder plus the cumulative Priority Return to the redemption date to the
extent not previously distributed. If fewer than all of the outstanding Series A
Preferred Units are to be redeemed, the Series A Preferred Units to be redeemed
shall be selected pro rata (as nearly as practicable without creating fractional
units).
B. Limitation on Redemption. The Partnership may not redeem fewer than
all of the outstanding Series A Preferred Units unless all accumulated and
unpaid distributions have been paid on all Series A Preferred Units for all
quarterly distribution periods terminating on or prior to the date of
redemption, unless such redemption is pursuant to a purchase or exchange offer
made on the same terms to all holders of Series A Preferred Units.
C. Procedures for Redemption.
1. Notice of redemption will be (a) faxed, and (b) mailed by
the Partnership, by certified mail, 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 A Preferred Units at their respective addresses as they
appear on the records of the Partnership. No failure to give or defect in such
notice shall affect the validity of the proceedings for the redemption of any
Series A Preferred Units except as to the holder to whom such notice was
defective or not given. In addition to any information required by law, each
such notice shall state: (u) the redemption date, (v) the Redemption Price, (w)
the aggregate number of Series A Preferred Units to be redeemed and if fewer
than all of the outstanding Series A Preferred Units are to be redeemed, the
number of Series A Preferred Units to be redeemed held by such holder, which
number shall equal such holder's pro rata share (based on the percentage of the
aggregate number of outstanding Series A Preferred Units that the total number
of Series A Preferred Units held by such holder represents) of the aggregate
number of Series A Preferred Units to be redeemed, (x) the place or places where
such Series A Preferred Units are to be surrendered for payment of the
Redemption Price, (y) that distributions on the Series A Preferred Units to be
redeemed will cease to accumulate on such redemption date and (z) that payment
of the Redemption Price will be made upon presentation and surrender of such
Series A Preferred Units.
2. If the Partnership gives a notice of redemption in respect
of Series A Preferred Units (which notice will be irrevocable) then, by 12:00
noon, New York City time, on the redemption date, the Partnership will deposit
irrevocably in trust for the benefit of the Series A Preferred Units being
redeemed funds sufficient to pay the applicable Redemption Price and will give
irrevocable instructions and authority to pay such Redemption Price to the
holders of the Series A Preferred Units upon surrender of the Series A Preferred
Units by such holders at the place designated in the notice of redemption. On
and after the date of redemption, distributions will cease to accumulate on the
Series A Preferred Units or portions thereof called for redemption, unless the
Partnership defaults in the payment thereof. If any date fixed for redemption of
Series A Preferred Units is not a Business Day, then payment of the Redemption
Price payable on such date will be made on the next succeeding day that is a
Business Day (and without any interest or other payment in respect of any such
delay) except that, if such Business Day falls in the next calendar year, such
payment will be made on the immediately preceding Business Day, in each case
with the same force and effect as if made on such date fixed for redemption. If
payment of the Redemption Price is improperly withheld or refused and not paid
by the Partnership, distributions on such Series A Preferred Units will continue
to accumulate from the original redemption date to the date of payment, in which
case the actual payment date will be considered the date fixed for redemption
for purposes of calculating the applicable Redemption Price.
(vi). Voting Rights.
A. General. Holders of the Series A Preferred Units will not have any
voting rights or right to consent to any matter requiring the consent or
approval of the Limited Partners, except as set forth below.
B. Certain Voting Rights. So long as any Series A Preferred Units
remain outstanding, the Partnership shall not, without the affirmative vote of
the holders of at least two-thirds of the Series A Preferred Units outstanding
at the time (1) authorize or create, or increase the authorized or issued amount
of, any class or series of Partnership Interests ranking prior to the Series A
Preferred Units with respect to payment of distributions or rights upon
liquidation, dissolution or winding-up, or reclassify any Partnership Interests
of the Partnership into any such Partnership Interest, or create, authorize or
issue any obligations or security convertible into or evidencing the right to
purchase any such Partnership Interests, (2) authorize or create, or increase
the authorized or issued amount of any Partnership Interests on a parity with
the Series A Preferred Units or reclassify any Partnership Interest of the
Partnership into any such Partnership Interest or create, authorize or issue any
obligation or security convertible into or evidencing the right to purchase any
such Partnership Interest but only to the extent such Partnership Interests are
issued to an affiliate of the Partnership, other than (i) the General Partner to
the extent the issuance of such interests was to allow the General Partner to
issue corresponding preferred stock to persons who are not affiliates of the
Partnership, (ii) Security Capital U.S. Realty, Security Capital Holdings, S.A.
Realty or any of their affiliates or (iii) to any other affiliate, provided that
a majority of Independent Directors (as defined in the Charter) of the General
Partner have approved such issuance, or (3) either consolidate, merge into or
with, or convey, transfer or lease its assets substantially as an entirety to,
any corporation or other entity, or amend, alter or repeal the provisions of the
Agreement (including, without limitation, this Section), whether by merger,
consolidation or otherwise, in each case in a manner that would materially and
adversely affect the powers, special rights, preferences, privileges or voting
power of the Series A Preferred Units or the holders thereof; provided, however,
that with respect to the occurrence of any event set forth in (3) above, so long
as (a) the Partnership is the surviving entity and the Series A Preferred Units
remain outstanding with the terms thereof unchanged, or (b) the resulting,
surviving or transferee entity is a partnership, limited liability company or
other pass-through entity organized under the laws of any state and substitutes
the Series A Preferred Units for other interests in such entity having
substantially the same terms and rights as the Series A Preferred Units,
including with respect to distributions, redemptions, transfers, voting rights
and rights upon liquidation, dissolution or winding-up, then the occurrence of
any such event shall not be deemed to materially and adversely affect such
rights, privileges or voting powers of the holders of the Series A Preferred
Units; and provided further, that any increase in the amount of Partnership
Interests or the creation or issuance of any other class or series of
Partnership Interests, in each case ranking (y) junior to the Series A Preferred
Units with respect to payment of distributions or the distribution of assets
upon liquidation, dissolution or winding-up, or (z) on a parity to the Series A
Preferred Units with respect to payment of distributions or the distribution of
assets upon liquidation, dissolution or winding-up to the extent such
Partnership Interests are not issued to an affiliate of the Partnership, other
than (i) the General Partner or any wholly-owned subsidiary thereof, to the
extent the issuance of such interests was to allow the General Partner to issue
corresponding preferred stock to persons who are not affiliates of the
Partnership, (ii) Security Capital U.S. Realty, Security Capital Holdings, S.A.
Realty or any of their affiliates or (iii) any other affiliate, provided that a
majority of Independent Directors of the General Partner have approved such
issuance, shall not be deemed to materially and adversely affect such rights,
preferences, privileges or voting powers.
(vii). Certain Transfer Provisions. If Contributor concludes based on
results or projected results that there exists (in the reasonable judgment of
Contributor) an imminent and substantial risk that the Contributor's interest in
the Partnership represents or will represent more than 19.5% of the total
profits or capital interests in the Partnership for a taxable year (the "19.5%
Limit") (determined in accordance with Treasury Regulations Section
1.731-2(e)(4)), then Contributor shall be permitted to transfer so much of its
Series A Preferred Units as may be appropriate to alleviate the risk of not
satisfying the 19.5% Limit.
(viii). Exchange Rights.
A. Right to Exchange.
1. Series A Preferred Units will be exchangeable with the
General Partner in whole but not in part unless expressly otherwise provided
herein at any time on or after November 1, 2008, at the option of 51% of the
holders of all outstanding Series A Preferred Units, for authorized but
previously unissued shares of Series A Preferred Stock at an exchange rate of
one share of Series A Preferred Stock from the General Partner for one Series A
Preferred Unit, subject to adjustment as described below, provided that the
Series A Preferred Units will become exchangeable at any time, in whole but not
in part unless expressly otherwise provided herein, at the option of 51% of the
holders of all outstanding Series A Preferred Units for Series A Preferred Stock
if (a) at any time full distributions shall not have been timely made on any
Series A Preferred Unit with respect to six (6) prior quarterly distribution
periods, whether or not consecutive; provided, however, that a distribution in
respect of Series A Preferred Units shall be considered timely made if made
within two (2) Business Days after the applicable Series A Preferred Unit
Distribution Payment Date if at the time of such late payment there shall not be
any prior quarterly distribution periods in respect of which full distributions
were not timely made, or (b) upon receipt by a holder or holders of Series A
Preferred Units of (y) notice from the General Partner that the General Partner
or a subsidiary of the General Partner has taken the position that the
Partnership is, or upon the consummation of an identified event in the immediate
future will be, a "Publicly Traded Partnership" (a "PTP") within the meaning of
Section 7704 of the Internal Revenue Code (the "Code") and (z) an opinion
rendered by counsel familiar with such matters addressed to a holder or holders
of Series A Preferred Units, that the Partnership is or likely is, or upon the
occurrence of a defined event in the immediate future will be or likely will be,
a PTP. In addition, the Series A Preferred Units may be exchanged for Series A
Preferred Stock, in whole but not in part unless expressly otherwise provided
herein, at the option of 51% of the holders of all outstanding Series A
Preferred Units after November 1, 2001 and prior to November 1, 2008 if such
holders of Series A Preferred Units shall deliver to the General Partner either
(c) a private letter ruling addressed to such holder of Series A Preferred Units
or (d) an opinion of counsel based on the enactment of temporary or final
Treasury Regulations or the publication of a Revenue Ruling, in either case to
the effect that such exchange of the Series A Preferred Units at such earlier
time would not cause the Series A Preferred Units to be considered "stock and
securities" within the meaning of Section 351(e) of the Code for purposes of
determining whether the holder of such Series A Preferred Units is an
"investment company" under Section 721(b) of the Code if an exchange is
permitted at such earlier date. Furthermore, the Series A Preferred Units, if
Contributor so determines, may be exchanged in whole but not in part (regardless
of whether held by Contributor) for Series A Preferred Stock if Contributor
concludes based on results or projected results that there exists (in the
reasonable judgment of Contributor) an imminent and substantial risk that the
Contributor's interest in the Partnership represents or will exceed the 19.5%
Limit.
2. Notwithstanding anything to the contrary set forth in
Section 4.02(e)(viii).A.1., if an Exchange Notice (as defined herein) has been
delivered to the General Partner, then the General Partner may, at its option,
within ten (10) Business Days after receipt of the Exchange Notice, elect to
cause the Partnership to redeem all or a portion of the outstanding Series A
Preferred Units for cash in an amount equal to the original Capital Contribution
per Series A Preferred Unit and all accrued and unpaid distributions thereon to
the date of redemption. If the General Partner elects to redeem fewer than all
of the outstanding Series A Preferred Units, the number of Series A Preferred
Units held by each holder to be redeemed shall equal such holder's pro rata
share (based on the percentage of the aggregate number of outstanding Series A
Preferred Units that the total number of Series A Preferred Units held by such
holder represents) of the aggregate number of Series A Preferred Units being
redeemed.
3. In the event an exchange of all Series A Preferred Units
pursuant to Section 4.02(e)(viii).A. would violate the provisions on ownership
limitation of the General Partner set forth in Section 12 of the General
Partner's Amended Charter, each holder of Series A Preferred Units shall be
entitled to exchange, pursuant to the provisions of Section 4.02(e)(viii).B, a
number of Series A Preferred Units which would comply with the provisions on the
ownership limitation of the General Partner and any Series A Preferred Units not
so exchanged (the "Excess Units") shall be redeemed by the Partnership for cash
in an amount equal to the original Capital Contribution per Excess Unit, plus
any accrued and unpaid distributions thereon to the date of redemption, subject
to any restriction thereon contained in any debt instrument or agreement of the
Partnership.
B. Procedure for Exchange and/or Redemption of Series A Preferred Units.
1. Any exchange shall be exercised pursuant to a notice of
exchange (the "Exchange Notice") delivered to the General Partner by the holders
representing at least 51% of the outstanding Series A Preferred Units (or by
Contributor in the case of an exchange pursuant to the last sentence of Section
4.02(e)(viii).A.1. hereof) by (a) fax and (b) certified mail postage prepaid.
The General Partner may effect any exchange of Series A Preferred Units, or
exercise its option to cause the Partnership to redeem any portion of the Series
A Preferred Units for cash pursuant to Section 4.02(e)(viii).A.2. or redeem
Excess Units pursuant to Section 4.02(e)(viii).A.3, by delivering to each holder
of record of Series A Preferred Units, within ten (10) Business Days following
receipt of the Exchange Notice, (a) if the General Partner elects to cause the
Partnership to exchange any of the Series A Preferred Units then outstanding, a
written notice stating (A) the redemption date, which may be the date of such
written notice or any other date which is not later than sixty (60) days
following the receipt of the Exchange Notice, (B) the redemption price, (C) the
place or places where the Series A Preferred Units are to be surrendered and (D)
that distributions on the Series A Preferred Units will cease to accrue on such
redemption date, or (b) if the General Partner elects to cause the Partnership
to redeem all of the Series A Preferred Units then outstanding in exchange for
cash, a Redemption Notice. If the General Partner elects to cause the
Partnership to exchange any of the Series A Preferred Units then outstanding, at
the time and place specified in the redemption notice, the General Partner shall
deliver certificates representing shares of the Series A Preferred Stock being
issued in exchange for the Series A Preferred Units of such holder being
exchanged. Series A Preferred Units shall be deemed canceled (and any
corresponding Partnership Interest represented thereby deemed terminated)
simultaneously with the delivery of shares of Series A Preferred Stock (with
respect to Series A Preferred Units exchanged) or simultaneously with the
redemption date (with respect to Series A Preferred Units redeemed). Holders of
Series A Preferred Units shall deliver any canceled certificates representing
Series A Preferred Units which have been exchanged or redeemed to the office of
the General Partner within ten (10) Business Days of the exchange or redemption
with respect thereto. Notwithstanding anything to the contrary contained herein,
any and all Series A Preferred Units to be exchanged for Series A Preferred
Stock pursuant to this Section 4.02(e)(viii) shall be so exchanged in a single
transaction at one time. As a condition to exchange, the General Partner may
require the holders of Series A Preferred Units to make such representations as
may be reasonably necessary for the General Partner to establish that the
issuance of Series A Preferred Stock pursuant to the exchange shall not be
required to be registered under the Securities Act of 1933, as amended (the
"Securities Act"), or any state securities laws. Any shares of Series A
Preferred Stock issued pursuant to this Section 4.02(e)(viii) shall be delivered
as shares which are duly authorized, validly issued, fully paid and
nonassessable, free of any pledge, lien, encumbrance or restriction other than
those provided in the Charter or the By-Laws of the General Partner, the
Securities Act and relevant state securities or blue sky laws. The certificates
representing the Series A Preferred Stock issued upon exchange of the Series A
Preferred Units shall contain the following legend:
THE SHARES REPRESENTED BY THIS CERTIFICATE MAY NOT BE TRANSFERRED,
SOLD, ASSIGNED, PLEDGED, HYPOTHECATED OR OTHERWISE DISPOSED OF EXCEPT
(A) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT OF 1933, AS AMENDED (THE "ACT") OR (B) IF THE
CORPORATION HAS BEEN FURNISHED WITH A SATISFACTORY OPINION OF COUNSEL
FOR THE HOLDER OF THE SHARES REPRESENTED HEREBY, OR OTHER EVIDENCE
SATISFACTORY TO THE CORPORATION, THAT SUCH TRANSFER, SALE, ASSIGNMENT,
PLEDGE, HYPOTHECATION OR OTHER DISPOSITION IS EXEMPT FROM THE
PROVISIONS OF SECTION 5 OF THE ACT AND THE RULES AND REGULATIONS
THEREUNDER.
2. In the event of an exchange of Series A Preferred Units for
Series A Preferred Stock, an amount equal to the accrued and unpaid
distributions to the date of exchange on any Series A Preferred Units tendered
for exchange shall (a) accrue on the Series A Preferred Stock into which such
Series A Preferred Units are exchanged, and (b) continue to accrue on such
Series A Preferred Units, which shall remain outstanding following such
exchange, with the General Partner as the holder of such Series A Preferred
Units. Fractional shares of Series A Preferred Stock are not to be issued upon
exchange but, in lieu thereof, the General Partner will pay a cash adjustment
based upon the fair market value of the Series A Preferred Stock on the day
prior to the exchange date as determined in good faith by the Board of Directors
of the General Partner.
C. Adjustment of Exchange Price. In case the General Partner shall be a
party to any transaction (including, without limitation, a merger,
consolidation, statutory share exchange, tender offer for all or substantially
all of the General Partner's capital stock or sale of all or substantially all
of the General Partner's assets), in each case as a result of which the Series A
Preferred Stock will be converted into the right to receive shares of capital
stock, other securities or other property (including cash or any combination
thereof), each Series A Preferred Unit will thereafter be exchangeable into the
kind and amount of shares of capital stock and other securities and property
receivable (including cash or any combination thereof) upon the consummation of
such transaction by a holder of that number of Series A Preferred Stock or
fraction thereof into which one Series A Preferred Unit was exchangeable
immediately prior to such transaction. The General Partner may not become a
party to any such transaction unless the terms thereof are consistent with the
foregoing.
(ix). Registration Rights. If the holders of the Series A Preferred Units
exercise their right to exchange such Series A Preferred Units for Series A
Preferred Stock pursuant to Section 4.02(e)(viii).A., such holders shall be
entitled to certain rights with respect to the registration of such shares for
sale under the Securities Act of 1933, as amended (the "Act"). Such holders may
request that the issuer of such shares file a registration statement under the
Act with respect to such shares, after which the issuer of such shares shall use
its best efforts to effect such registration.
(x). No Other Conversion Rights. Except as provided above, the holders of the
Series A Preferred Units shall not have any rights to convert such Series A
Preferred Units into any other securities of, or interest in, the Partnership or
the General Partner.
(xi). No Sinking Fund. No sinking fund shall be established for the retirement
or redemption of Series A Preferred Units.
<PAGE>
Article V, Section 5.01(a) is hereby amended and restated in its
entirety as follows:
(a) General Allocations.
(i) Depreciation and Amortization Deductions. Except
as otherwise provided in this Section 5.01,
depreciation and amortization deductions for
each fiscal year of the Partnership shall be
allocated among the Non-Greene Street Partners
pro-rata based on their respective Percentage
Interests.
(ii) Profits. Except as otherwise provided in this
Section 5.01, Profits, including profits from a
disposition of all or any portion of Property,
shall be allocated at the end of each fiscal
year to the Partners as follows:
(1) First, to Greene Street until the
aggregate amount of Profits allocated to
Greene Street for the current and all
prior years equals the aggregate amount
of cash distributed to Greene Street
under Section 4.02(e)(iii) for the
current and all prior years; and
(2) Thereafter, to the Non-Greene Street
Partners pro rata based on their
respective Percentage Interests.
(iii) Losses. Except as otherwise provided in this
Section 5.01, Losses, including losses from a
disposition of all or any portion of Property,
shall be allocated at the end of each fiscal
year as follows:
(1) First, pro rata to the Non-Greene Street
Partners until their Capital Accounts
have been reduced to zero;
(2) Second, to the General Partner to the
extent permitted under applicable
Regulations; and
(3) Thereafter, to Greene Street.
Article VIII of the Agreement is hereby amended by adding Section
8.05(e), as follows:
(e) For purposes of this Section 8.05, "Partnership Units"
shall mean "Common Units."
IN WITNESS WHEREOF, the General Partner has caused this Amendment to be duly
executed by its Chief Financial Officer as of this 12th day of November, 1998.
STORAGE USA, INC.
as General Partner
By: /s/ Christopher P. Marr
Its: Chief Financial Officer
Exhibit 10.2
STORAGE USA, INC.
REGISTRATION RIGHTS AGREEMENT
This Registration Rights Agreement (the "Agreement") is made and
entered into as of November 12,1998, by and between Storage USA, Inc., a
Tennessee corporation (the "Company"), and Greene Street 1998 Exchange Fund,
L.P., a Delaware limited partnership (the "Purchaser").
This Agreement is made pursuant to the Private Placement Purchase
Agreement (the "Purchase Agreement"), dated November 12, 1998, between the
Company and the Purchaser and the Second Amended and Restated Agreement of
Limited Partnership and Amendment Nos. 1, 2, 3 and 4 thereto (collectively, the
"Partnership Agreement"). In order to induce the Purchaser to enter into the
Purchase Agreement, the Company has agreed to provide the registration rights
provided for in this Agreement to the Purchaser and its respective direct and
indirect transferees. The execution of this Agreement is a condition to the
closing of the transactions contemplated by the Purchase Agreement.
The parties hereby agree as follows:
1. Definitions
As used in this Agreement, the following terms shall have the following
meanings:
Affiliate: (i) Any person directly or indirectly owning, controlling,
or holding, with power to vote ten percent or more of the outstanding voting
securities of such other person, (ii) any person ten percent or more of whose
outstanding voting securities are directly or indirectly owned, controlled, or
held, with power to vote, by such other person, (iii) any person directly or
indirectly controlling, controlled by, or under common control with such other
person, (iv) any executive officer, director, trustee or general partner of such
other person, and (v) any legal entity for which such person acts as an
executive officer, director, trustee or general partner. An indirect
relationship shall include circumstances in which a person's spouse, children,
parents, siblings or mothers-, fathers-, sisters or brothers-in-law is or has
been associated with a person.
Agreement: This Registration Rights Agreement, as the same may be
amended, supplemented or modified from time to time in accordance with the terms
hereof.
Business Day: With respect to any act to be performed hereunder, 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, New York are authorized or
required by law, regulation or executive order to close.
Closing Date: November 12, 1998
Commission: The Securities and Exchange Commission.
Company: Storage USA, Inc., a Tennessee corporation, and any successor
corporation thereto.
Controlling person: As defined in Section 5(a) hereof.
Exchange Act: The Securities Exchange Act of 1934, as amended, and the
rules and regulations promulgated by the Commission pursuant thereto.
Form S-3. Such form under the Securities Act as is in effect on the
date hereof or any successor registration form under the Securities Act
subsequently adopted by the Commission that permits inclusion or incorporation
of substantial information by reference to other documents filed by the Company
with the Commission.
Holder: Each holder of any Registrable Shares.
Indemnified Party: As defined in Section 5(a) hereof.
Person: An individual, partnership, corporation, trust, unincorporated
organization, government or agency or political subdivision thereof, or any
other legal entity.
Proceeding: An action, claim, suit or proceeding (including, without
limitation, an investigation or partial proceeding, such as a deposition),
whether commenced or, to the knowledge of the person subject thereto,
threatened.
Prospectus: The prospectus included in any Registration Statement,
including any preliminary prospectus, and all other amendments and supplements
to any such prospectus, including post-effective amendments, and all material
incorporated by reference or deemed to be incorporated by reference, if any, in
such prospectus.
Purchase Agreement: The Purchase Agreement is as defined in the
preamble.
Purchaser: Greene Street 1998 Exchange Fund, L.P.
Register, registered and registration: Such terms shall refer to a
registration effected by preparing and filing a registration statement in
compliance with the Securities Act and applicable rules and regulations
thereunder, and the declaration or ordering of the effectiveness of such
registration statement.
Registrable Shares: Each of the Shares until (i) the date on which it
has been registered effectively pursuant to the Securities Act and disposed of
in accordance with a Registration Statement relating to it, (ii) the date on
which it is sold pursuant to Rule 144 (or any similar provisions then in
effect), (iii) the date on which it can be sold without restriction, pursuant to
an available exemption from registration under the Securities Act, or (iv) the
date on which it is sold to the Company.
Registration Statement: Any registration statement of the Company that
covers the resale of any of the Registrable Shares pursuant to the provisions of
this Agreement, including the Prospectus, amendments and supplements to such
registration statement or Prospectus, including pre- and post-effective
amendments, all exhibits thereto, and all material incorporated by reference or
deemed to be incorporated by reference, if any, in such registration statement.
Rule 144: Rule 144 promulgated by the Commission pursuant to the
Securities Act, as such rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission as a replacement thereto
having substantially the same effect as such rule.
Rule 144A: Rule 144A promulgated by the Commission pursuant to the
Securities Act, as such rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission as a replacement thereto
having substantially the same effect as such rule.
Rule 424: Rule 424 promulgated by the Commission pursuant to the
Securities Act, as such rule may be amended from time to time, or any similar
rule or regulation hereafter adopted by the Commission as a replacement thereto
having substantially the same effect as such rule.
Securities Act: The Securities Act of 1933, as amended, and the rules
and regulations promulgated by the Commission thereunder.
Series A Preferred Stock: The 8 7/8% Series A Cumulative Redeemable
Preferred Stock of the Company.
Shares: The shares of Series A Preferred Stock being offered and sold
pursuant to the Purchase Agreement.
Underwritten Offering: A sale of securities of the Company to an
underwriter or underwriters pursuant to a Registration Statement for reoffering
to the public.
2. Registration
If the Company shall receive from the Holders of at least twenty-five
(25) percent of all outstanding Registrable Shares a written request or requests
that the Company effect a registration covering the resale of the Registrable
Shares and any related qualification or compliance under applicable state
securities or "Blue Sky" laws with respect to all or a part of the Registrable
Shares owned by such Holders, which, at the option of the Holders of a majority
of the Registrable Shares requested to be registered, may be a "shelf" offering
pursuant to Rule 415 under the Securities Act, then the Company will:
(a) Notice. Promptly give written notice of the proposed registration
and the Holders' request therefor, and any related qualification or compliance,
to all other Holders of Registrable Shares; and
(b) Registration. As soon as practicable, use commercially reasonable
efforts to effect such registration and all such qualifications and compliances
as may be so requested and as would permit or facilitate the sale and
distribution of all or such portion of such Holders' Registrable Shares as are
specified in such request, together with all or such portion of the Registrable
Shares of any other Holders joining in such request as are specified in a
written request given within twenty (20) days after receipt of such written
notice from the Company; provided, however, that the Company shall not be
obligated to effect any such registration, qualification or compliance pursuant
to this Section 2:
(i) if the Holders, together with the holders of any
other securities of the Company entitled to inclusion in such registration,
propose to sell Registrable Shares and such other securities (if any) at an
aggregate price to the public of less than $2,500,000;
(ii) if the Company shall furnish to the Holders a
certificate signed by the President or Chief Executive Officer of the Company
stating that in the good faith judgment of the Board of Directors of the
Company, that such registration and sale would (a) require disclosure of a
previously undisclosed material development involving the Company which
disclosure would have a material adverse effect on the Company or its prospects
or (b) materially interfere with any financing, acquisition, corporate
reorganization or other material transaction involving the Company then under
consideration, then the Company shall have the right to defer the filing of such
registration statement for a period of not more than 120 days after receipt of
the request of the Holders under this Section 2;
(iii) in any particular jurisdiction in which the
Company would be required to qualify to do business as a foreign corporation or
to execute a general consent to service of process in effecting such
registration, qualification, or compliance, unless the Company is already
subject to service or required to be so qualified in such jurisdiction and
except as may be required by the Securities Act; or
(iv) if within 14 days after its receipt of a written
request to effect such registration, the Company causes to be delivered to the
Holders an opinion of counsel reasonably acceptable to the Holders to the effect
that the proposed disposition of Registrable Shares by the Holders will not
require registration under the Securities Act, it being specifically understood
and agreed that the Holders will promptly furnish to the Company and such
counsel all information such counsel may reasonably request in order to enable
such counsel to determine whether it would be able to render such opinion.
(c) Expenses. The Company shall pay all expenses incurred in connection
with the registration contemplated by this Section 2, (excluding underwriters'
or brokers' discounts and commissions), including, without limitation, all
filing, registration and qualification, printers' and accounting fees and the
fees and disbursements of counsel for the Company.
(d) One Registration. The Company shall not be obligated to effect more
than one registration hereunder.
3. Registration Procedures. In connection with the obligations of the Company
with respect to any registration pursuant to this Agreement, the Company shall
use commercially reasonable efforts to effect or cause to be effected the
registration of the Registrable Shares under the Securities Act to permit the
sale of such Registrable Shares by the Holder or Holders in accordance with the
Holders' intended method or methods of distribution, and the Company shall:
(a) prepare and file with the Commission, as specified in this
Agreement, a Registration Statement, which Registration Statement shall comply
as to form in all material respects with the requirements of the applicable form
and include all financial statements required by the Commission to be filed
therewith, and use its reasonable best efforts to cause such Registration
Statement to become effective and remain effective for two years or until all
such Registrable Shares have been sold;
(b) subject to Section 3(i) hereof, prepare and file with the
Commission such amendments and post-effective amendments to each such
Registration Statement as may be necessary to keep such Registration Statement
effective for the applicable period; cause each such Prospectus to be
supplemented by any required prospectus supplement, and as so supplemented to be
filed pursuant to Rule 424 or any similar rule that may be adopted under the
Securities Act; and comply with the provisions of the Securities Act applicable
to the Company with respect to such Registration Statement during the applicable
period;
(c) furnish to the Holder of Registrable Shares without charge as many
copies of each Prospectus, including each preliminary Prospectus, and any
amendment or supplement thereto and such other documents as such Holder may
reasonably request, in order to facilitate the public sale or other disposition
of the Registrable Shares;
(d) use commercially reasonable efforts to register or qualify, or
obtain an exemption from registration or qualification for, all Registrable
Shares by the time the applicable Registration Statement is declared effective
by the Commission under all applicable state securities or "blue sky" laws of
such jurisdictions as the Holder of Registrable Shares covered by a Registration
Statement shall reasonably request in writing, keep each such registration or
qualification or exemption effective during the period such Registration
Statement is required to be kept effective and do any and all other acts and
things that may be reasonably necessary or advisable to enable such Holder to
consummate the disposition in each such jurisdiction of such Registrable Shares
owned by such Holder; provided, however, that the Company shall not be required
to (i) qualify generally to do business in any jurisdiction or to register as a
broker or dealer in such jurisdiction where it would not otherwise be required
to qualify but for this Section 3(d), (ii) subject itself to taxation in any
such jurisdiction or (iii) submit to the general service of process in any such
jurisdiction; provided, further, that if the Company fails to list the
Registrable Shares on a national stock exchange or qualify for quotation on an
automatic quotation system at or prior to the time the Registration Statement is
declared effective by the Commission because it fails to meet requirements for
such listing or quotation regarding the number of holders, the obligation in
this Section 3(d) shall not require the Company to register or qualify the
Registrable Shares in any jurisdiction where the Company reasonably concludes,
based upon the advice of securities counsel, that such registration or
qualification would require unreasonable effort (including, without limitation,
amendments to the Company's charter or bylaws) or expense;
(e) notify the Holder of Registrable Shares promptly and, if requested
by such Holder, confirm such advice in writing (i) when a Registration Statement
has become effective and when any post-effective amendments and supplements
thereto become effective, (ii) of the issuance by the Commission or any state
securities authority of any stop order suspending the effectiveness of a
Registration Statement or the initiation of any proceedings for that purpose,
and (iii) of the happening of any event during the period a Registration
Statement is effective as a result of which such Registration Statement or the
related Prospectus contains any untrue statement of a material fact or omits to
state any material fact required to be stated therein or necessary to make the
statements therein not misleading, and (iv) at the written request of any such
Holder, promptly to furnish to such Holder a reasonable number of copies of a
supplement to or an amendment of such Prospectus as may be necessary so that, as
thereafter delivered to the purchaser of such securities, such Prospectus shall
not include an untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading;
(f) upon written request, furnish to the Holder of Registrable Shares
copies of any request by the Commission or any state securities authority for
amendments or supplements to a Registration Statement and Prospectus or for
additional information;
(g) make every commercially reasonable effort to avoid the issuance of,
or if issued to obtain the withdrawal of, any enjoining order suspending the use
or effectiveness of a Registration Statement or the lifting of any suspension of
the qualification (or exemption from qualification) of any of the Registrable
Shares for sale in any jurisdiction, at the earliest possible moment;
(h) upon written request, furnish to the Holder of Registrable Shares,
without charge, at least one conformed copy of each Registration Statement and
any post-effective amendment thereto (without documents incorporated therein by
reference or exhibits thereto, unless requested);
(i) upon the occurrence of any event contemplated by Section 3(e)(iii)
hereof, use commercially reasonable efforts to prepare a supplement or
post-effective amendment to a Registration Statement or the related Prospectus
or any document incorporated therein by reference or file any other required
document so that, as thereafter delivered to the purchasers of the Registrable
Shares, such Prospectus will not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading;
(j) If requested by the representative of the underwriters, if any, or
any Holders of Registrable Shares being sold in connection with such offering,
(i) promptly incorporate in a prospectus supplement or post-effective amendment
such information as the representative of the underwriters, if any, or such
Holders indicate relates to them or otherwise reasonably request be included
therein, and (ii) make all required filings of such prospectus supplement or
such post-effective amendment as soon as practicable after the Company has
received notification of the matters to be incorporated in such prospectus
supplement or post-effective amendment; provided, however, that the Company
shall not be required to take any action pursuant to this Section 3 that would,
in the opinion of counsel for the Company, violate applicable law;
(k) make available for inspection by representatives of the Holder of
the Registrable Shares and the representative of any underwriters participating
in any disposition pursuant to a Registration Statement and any special counsel
or accountant retained by such Holders or underwriters, all financial and other
records, pertinent corporate documents and properties of the Company and cause
the respective officers, directors and employees of the Company to supply all
information reasonably requested by any such representatives, the representative
of the underwriters, the special counsel or accountants in connection with a
Registration Statement; provided, however, that such records, documents or
information that the Company determines, in good faith, to be confidential and
notifies such representatives, representative of the underwriters, special
counsel or accountants are confidential shall not be disclosed by the
representatives, representative of the underwriters, special counsel or
accountants unless (i) the disclosure of such records, documents or information
is necessary to avoid or correct a misstatement or omission in a Registration
Statement, (ii) the release of such records, documents or information is ordered
pursuant to a subpoena or other order from a court of competent jurisdiction, or
(iii) such records, documents or information have been generally made available
to the public;
(l) otherwise use commercially reasonable efforts to comply with all
applicable rules and regulations of the Commission and make generally available
to its securityholders, as soon as reasonably practicable, earnings statements
covering at least 12 months that satisfy the provisions of Section 1l(a) of the
Securities Act and Rule 158 (or any similar rule promulgated under the
Securities Act) thereunder;
(m) provide and cause to be maintained a transfer agent for all
Registrable Shares covered by any Registration Statement from and after a date
not later than the effective date of such Registration Statement; and
(n) in connection with any sale or transfer of Registrable Shares that
will result in such securities no longer being Registrable Shares, cooperate
with the Holders and the representative of the underwriters, if any, to
facilitate the timely preparation and delivery of certificates representing the
Registrable Shares to be sold, which certificates shall not bear any restrictive
legends, and to cause the issuance of certificates representing such Registrable
Shares in such denominations and registered in such names as the representative
of the underwriters, if any, or Holders may request at least two Business Days
prior to any sale of the Registrable Shares.
In addition, the Company may require the Holder of Registrable
Shares to furnish to the Company such information regarding the proposed
distribution by such Holder of such Registrable Shares as the Company may from
time to time reasonably request in writing or as shall be required to effect the
registration of their Registrable Shares.
The Holder agrees that, upon receipt of any notice from the
Company of the happening of any event of the kind described in Section 3(e)(iii)
hereof, such Holder will immediately discontinue disposition of Registrable
Shares pursuant to a Registration Statement until such Holder's receipt of the
copies of the supplemented or amended Prospectus. If so directed by the Company,
such Holder will deliver to the Company (at the expense of the Company) all
copies in its possession, other than permanent file copies then in such Holder's
possession, of the Prospectus covering such Registrable Shares current at the
time of receipt of such notice.
4. Black-Out Period.
(a) Following the effectiveness of a Registration Statement (and the
filings with any state securities commissions), the Company may direct the
Holder to suspend sales of the Registrable Shares for such times as the Company
reasonably may determine are necessary and advisable, including upon the
occurrence of any of the following events: (i) an Underwritten Offering by the
Company where the Company is advised by the managing underwriter(s) for such
Underwritten Offering that sale of Registrable Shares under the Registration
Statement would have a material adverse effect on the offering, or (ii) pending
negotiations relating to, or consummation of, a transaction or the occurrence of
an event (x) that would require additional disclosure of material information by
the Company in the Registration Statement (or such filings), (y) as to which the
Company has a bona fide business purpose for preserving confidentiality, or (z)
that renders the Company unable to comply with Commission requirements, in each
case under circumstances that would make it impractical or inadvisable to cause
the Registration Statement (or such filings) to become effective or to promptly
amend or supplement the Registration Statement on a post-effective basis, as
applicable (a "Suspension Event"); provided, however that any such Suspension
Event shall not exceed 120 days during any 12 month period.
(b) In the case of a Suspension Event, the Company shall give written
notice (a "Suspension Notice") to the Holders to suspend sales of the
Registrable Shares so that the Company may correct or update the Registration
Statement (or such filings); provided, however, that such suspension shall
continue only for so long as the Suspension Event or its effect is continuing.
No Holder shall effect any sales of the Registrable Shares pursuant to such
Registration Statement (or such filings) at any time after it has received a
Suspension Notice from the Company. If so directed by the Company, the Holders
will deliver to the Company all copies of the Prospectus covering the
Registrable Shares held by them at the time of receipt of the Suspension Notice.
The Holders may recommence effecting sales of the Registrable Shares pursuant to
the Registration Statement (or such filings) following further notice to such
effect (an "End of Suspension Notice") from the Company, which End of Suspension
Notice shall be given by the Company promptly following the conclusion of any
Suspension Event.
5. Indemnification and Contribution.
(a) Indemnification by the Company. The Company agrees to indemnify and
hold harmless (i) the Purchaser, (ii) each Holder of the Registrable Shares,
(iii) each person, if any, who controls (within the meaning of the Securities
Act or the Exchange Act) any of the foregoing (any of the persons referred to in
this clause (iii) being hereinafter referred to as a "controlling person"), and
(iv) the respective officers, directors, partners, employees, representatives
and agents of the Purchaser, each Holder of the Registrable Shares, or any
controlling person thereof (any person referred to in clause (i), (ii), (iii) or
(iv) may hereinafter be referred to as an "Indemnified Party"), as follows:
(i) from and against any and all loss, claim, liability,
damage and expense whatsoever, as incurred, arising out of any untrue statement
or alleged untrue statement of a material fact contained in any Registration
Statement (or any amendment thereto) pursuant to which Registrable Shares were
registered under the Securities Act including all documents incorporated therein
by reference, or the omission or alleged omission to state a material fact
required to be stated therein or necessary to make the statements therein, in
light of the circumstances under which they were made, not misleading or arising
out of any untrue statement or alleged untrue statement of a material fact
contained in any Prospectus (or any amendment or supplement thereto), including
all documents incorporated therein by reference; provided, however, that such
indemnity with respect to any Prospectus shall not inure to the benefit of the
Holder (or any controlling person thereof) to the extent that any such loss,
claim, liability, damage or expense arises out of such Holder's failure to send
or give a copy of the final Prospectus, as the same may be then supplemented or
amended, to the person asserting an untrue statement or alleged untrue statement
or omission or alleged omission at or prior to the written confirmation of the
sale of Registrable Shares to such person if such statement or omission was
corrected in such final Prospectus.
(ii) from and against any and all loss, liability, claim,
damage and expense whatsoever, as incurred, to the extent of the aggregate
amount paid in settlement of any litigation, or investigation or proceeding by
any governmental agency or body, commenced or threatened, or of any claim
whatsoever based upon any such untrue statement or omission, if, and only if,
such settlement is effected with the written consent of the Company (which
consent shall not be unreasonably withheld); and
(iii) from and against any and all expense whatsoever, as
incurred (including reasonable fees and disbursements of one counsel, except as
otherwise provided in Section 5(c) hereof), incurred in investigating, preparing
or defending against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, in each case whether or
not a party, or any claim whatsoever based upon any such untrue statement or
omission, or any such alleged untrue statement or omission, to the extent that
any such expense is not paid under subparagraph (i) or (ii) above;
provided, however, that this indemnity agreement does not apply to the Holder
with respect to any loss, liability, claim, damage or expense to the extent
arising out of any untrue statement or omission or alleged untrue statement or
omission made in reliance upon and in conformity with written information
furnished to the Company by such Holder expressly for use in a Registration
Statement (or any amendment thereto) or any Prospectus (or any amendment or
supplement thereto).
(b) Indemnification by Holders. Each Holder severally agrees to
indemnify and hold harmless the Company, each of its directors and officers
(including each officer of the Company who signed the Registration Statement),
each person, if any, who controls the Company, within the meaning of the
Securities Act and the Exchange Act, any underwriter and any Holder selling
securities under such Registration Statement or any of such other Holder's
partners, directors or officers or any person who controls such Holder within
the meaning of the Securities Act or the Exchange Act, against any and all loss,
liability, claim, damage and expenses described in the indemnity contained in
Section 5(a) hereof (provided, however, that any settlement described in Section
5(a)(ii) hereof is effected with the written consent of such Holder, which
consent shall not be unreasonably withheld), as incurred, but only with respect
to such untrue statement or omission, or alleged untrue statements or omissions,
made in a Registration Statement (or any amendment thereto) or any Prospectus
(or any amendment or supplement thereto) in reliance upon and in conformity with
written information furnished to the Company by the Holder expressly for use in
such Registration Statement (or any amendment thereto) or such Prospectus (or
any amendment or supplement thereto).
(c) Conduct of Indemnification Proceedings. Each Indemnified Party
shall give reasonably prompt notice to each indemnifying party of any action or
proceeding commenced against it in respect of which indemnity may be sought
hereunder, but failure to so notify an indemnifying party shall not relieve it
from any liability that it may have under this indemnity agreement except to the
extent that the indemnifying party is actually prejudiced by such failure to
give notice. If the indemnifying party so elects within a reasonable time after
receipt of such notice, the indemnifying party may assume the defense of such
action or proceeding at such indemnifying party's own expense with counsel
chosen by the indemnifying party and approved by the Indemnified Party or
parties in such action or proceeding, which approval shall not be unreasonably
withheld; provided, however, that if such Indemnified Party or parties
reasonably determines that a conflict of interest exists where it is advisable
for such Indemnified Party or parties to be represented by separate counsel or
that, upon advice of counsel, there may be legal defenses available to them that
are different from or in addition to those available to the indemnifying party,
then the indemnifying party shall not be entitled to assume such defense and the
Indemnified Party or parties shall be entitled to one separate counsel at the
indemnifying party's expense. If an indemnifying party is not entitled to assume
the defense of such action or proceeding as a result of the proviso to the
preceding sentence, such indemnifying party's counsel shall be entitled to
conduct such indemnifying party's defense, and counsel for the Indemnified Party
or parties shall be entitled to conduct the defense of such Indemnified Party or
parties, it being understood that both such counsel will cooperate with each
other to conduct the defense of such action or proceeding as efficiently as
possible. If an indemnifying party is not so entitled to assume the defense of
such action or does not assume such defense, after having received the notice
referred to in the first sentence of this paragraph, the indemnifying party or
parties will pay the reasonable fees and expenses counsel for the Indemnified
Party or parties. In such event, however, no indemnifying party will be liable
for any settlement effected without the written consent of such indemnifying
party. No indemnifying party shall, without the consent of the Indemnified
Party, consent to entry of any judgment or enter into a settlement that does not
include as an unconditional term thereof the giving by the claimant or plaintiff
to such Indemnified Party of a release from all liability in respect to such
claim or litigation. If an indemnifying party is entitled to assume, and
assumes, the defense of such action or proceeding in accordance with this
paragraph, such indemnifying party shall not be liable for any fees and expenses
for counsel for the Indemnified Parties incurred thereafter in connection with
such action or proceeding.
(d) Contribution. In order to provide for just and equitable
contribution in circumstances in which the indemnity agreement provided for in
this Section 5 is for any reason held to be unenforceable, unavailable or
insufficient although applicable in accordance with its terms, the Company and
Holder shall contribute to the aggregate losses, liabilities, claims, damages
and expenses of the nature contemplated by such indemnity agreement incurred by
the Company and the Holder in such proportion as is appropriate to reflect the
relative fault of the indemnifiying party and the Indemnified Party, as well as
any other relevant equitable considerations. The relative fault of the
indemnifying party and the Indemnified Party shall be determined by reference
to, among other things, whether the untrue or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact related
to information supplied by the indemnifying party or Indemnified Party, and the
parties' relative intent, knowledge, access to information and opportunity to
correct or prevent such statement or omission.. Notwithstanding the foregoing,
no person guilty of fraudulent misrepresentation (within the meaning of Section
11(f) of the Securities Act) shall be entitled to contribution from any person
who is not guilty of such fraudulent misrepresentation. For purposes of this
Section 5, each person, if any, who controls a Holder within the meaning of
Section 15 of the Securities Act shall have the same rights to contribution as
such Holder, and each director of the Company, each officer of the Company who
signed the Registration Statement and each person, if any, who controls the
Company within the meaning of Section 15 of the Securities Act shall have the
same rights to contribution as the Company. Each party entitled to contribution
agrees that upon the service of a summons or other initial legal process upon it
in any action instituted against it in respect of which contribution may be
sought, it shall promptly give written notice of such service to the party or
parties from whom contribution may be sought, but the omission so to notify such
party or parties of any such service shall not relieve the party from whom
contribution may be sought from any obligation it may have hereunder or
otherwise.
(e) Survival. The obligations of the Company and the Holders under this
Section 5 shall survive the completion of any offering of Registrable Shares in
a Registration Statement and otherwise.
6. Termination of the Company's Obligations. The Company shall have no
obligations pursuant to this Agreement with respect to any Registrable Shares
proposed to be sold by a Holder in a registration pursuant to this Agreement if,
in the opinion of counsel to the Company, all such Registrable Shares proposed
to be sold by a Holder may be sold in a three-month period without registration
under the Securities Act pursuant to Rule 144 under the Securities Act.
7. Miscellaneous
(a) Remedies. In the event of a breach by the Company, or by a Holder
of the Registrable Shares, of any of their obligations under this Agreement,
each Holder of the Registrable Shares of the Company, in addition to being
entitled to exercise all rights granted by law, including recovery and damages,
will be entitled to specific performance of its rights under this Agreement;
provided, however, that no Holder shall have any right to obtain or seek an
injunction restraining or otherwise delaying any registration as the result of
any controversy that might arise with respect to the interpretation or
implementation of this Agreement.
(b) Amendments and Waivers. The provisions of this Agreement, including
the provisions of this sentence, may not be amended, modified or supplemented,
and waivers or consents to departures from the provisions hereof may not be
given, except if the written consent of the Holders of a majority in aggregate
principal amount of the then outstanding Registrable Shares is obtained;
provided, however, that for the purposes of this Agreement, Registrable Shares
that are owned, directly or indirectly, by either the Company or an Affiliate of
the Company are not deemed outstanding. Notwithstanding the foregoing, a waiver
or consent to depart from the provisions hereof with respect to a matter that
relates exclusively to the rights of Holders of the Registrable Shares whose
securities are being sold pursuant to a Registration Statement and that does not
directly or indirectly affect the rights of other Holders of the Registrable
Shares may be given by Holders of a majority of the Registrable Shares being
sold by such Holders pursuant to such Registration Statement; provided, however,
that the provisions of this sentence may not be amended, modified, or
supplemented except in accordance with the provisions of the immediately
preceding sentence.
(c) Notices. All notices and other communications provided for herein
shall be made in writing by hand-delivery, next-day air courier, certified
first-class mail, return receipt requested, telex or telecopy;
(i) if to the Company, to Storage USA, Inc., 165
Madison Avenue, Suite 125, Memphis, Tennessee 38103, Attention: General Counsel;
(ii) if to the Purchaser, to Greene Street 1998
Exchange Fund, L.P., c/o Goldman Sachs & Co., One New York Plaza, New York, New
York 10004, Attention: Elizabeth Groves;
(iii) if to any other person who is then the
registered Holder of any Registrable Shares, to the address of such Holder as it
appears in the Common Stock register of the Company.
Except as otherwise provided in this Agreement, all such communications
shall be deemed to have been duly given (v) when delivered by hand, if
personally delivered, (w) one Business Day after being timely delivered to a
next-day air courier, (x) five Business Days after being deposited in the mail,
postage prepaid, if mailed, (y) when answered back, if telexed, or (z) when
receipt is acknowledged by the recipient's telecopier machine, if telecopied.
(d) Successors and Assigns. Notwithstanding anything herein to the
contrary, the registration rights of a Holder hereunder may be assigned only to
a party who acquires at least 100,000 Registrable Shares; provided, however,
that no party may be assigned any of the foregoing rights unless the Company is
given written notice by the assigning party at the time of such assignment
stating the name and address of the assignee and identifying the Shares as to
which the rights in question are being assigned; and provided, further that any
such assignee shall receive such assigned rights subject to all the terms and
conditions of this Agreement, including, without limitation, the provisions of
this Section 7(d).
(e) Counterparts. This Agreement may be executed in any number of
counterparts and by the parties hereto in separate counterparts, each of which
when so executed shall be deemed to be an original, and all of which taken
together shall constitute one and the same Agreement.
(f) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Tennessee, as applied to contracts made
and performed within the State of Tennessee without regard to principles of
conflicts of law.
(g) Severability. If any term, provision, covenant or restriction of
this Agreement is held by a court of competent jurisdiction to be invalid,
illegal, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions set forth herein shall remain in full force and
effect and shall in no way be affected, impaired or invalidated, and the parties
hereto shall use their reasonable efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term, provision, covenant or restriction. It is hereby stipulated and
declared to be the intention of the parties that they would have executed the
remaining terms, provisions, covenants and restrictions without including any of
such that may be hereafter declared invalid, illegal, void or unenforceable.
(h) Headings. The headings in this Agreement are for convenience of
reference only and shall not limit or otherwise affect the terms of this
Agreement. All references made in this Agreement to "Section" refer to such
Section of this Agreement, unless expressly stated otherwise.
(i) Costs and Attorneys' Fees. In any action or proceeding brought to
enforce any provision of this Agreement, or where any provision hereof is
validly asserted as a defense, the prevailing party, as determined by the court,
shall be entitled to recover its reasonable costs and attorneys' fees in
addition to any other available remedy.
(j) Adjustment for Stock Splits, etc. Wherever in this Agreement there
is a reference to a specific number of shares, then upon the occurrence of any
subdivision, combination, or stock dividend of such shares, the specific number
of shares so referenced in this Agreement shall automatically be proportionally
adjusted to reflect the affect on the outstanding shares of such class or series
of stock by such subdivision, combination, or stock dividend.
(k) Aggregation of Stock. All shares held or acquired by affiliated
entities or persons shall be aggregated together for the purpose of determining
the availability of any rights under this Agreement.
SIGNATURE PAGE FOLLOWS
<PAGE>
IN WITNESS WHEREOF, the parties have caused this Registration
Rights Agreement to be duly executed as of the date first written above.
THE COMPANY: STORAGE USA, INC.
By: /s/ Christopher P. Marr
Name: Christopher P. Marr
Title: Chief Financial Officer
THE PURCHASER: GREENE STREET 1998 EXCHANGE FUND L.P.
By: Goldman Sachs Management Partners,
L.P., General Partner
By: /s/ Elizabeth C. Groves
Name: Elizabeth C. Groves
Title: Vice President
