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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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 14, 1997 (November 12,
1997)
GLIMCHER REALTY TRUST
(Exact Name of Registrant as Specified in Charter)
Maryland 1-12482 31-1390518
(State or Other Jurisdiction (Commission (IRS Employer
of Incorporation) File Number) Identification No.)
20 South Third Street, Columbus, Ohio 43215
(Address of Principal Executive Offices) (Zip Code)
Registrant's telephone number, including area code (614) 621-9000
(FORMER NAME OR FORMER ADDRESS, IF CHANGED SINCE LAST REPORT)
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ITEM 5. OTHER EVENTS
On November 12, 1997, Glimcher Realty Trust, a Maryland real estate
investment trust (the "Company") and Glimcher Properties Limited Partnership, a
Delaware limited partnership, entered into an Underwriting Agreement (the
"Underwriting Agreement") with Donaldson, Lufkin & Jenrette Securities
Corporation, Prudential Securities Incorporated, BT Alex. Brown Incorporated and
PaineWebber Incorporated, as representatives of the several underwriters named
in Schedule I to the Underwriting Agreement (the "Underwriters"), providing for
the purchase by the Underwriters from the Company of 4,800,000 9-1/4% Series B
Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $0.01
per share (the "Series B Preferred Shares"), of the Company (the "Offering") at
a purchase price of $25.00 per Series B Preferred Share (the "Purchase Price").
Distributions are cumulative from the date of original issue and are payable
quarterly on or about the 15th day of January, April, July and October of each
year, commencing on January 15, 1998 at the rate of 9-1/4% per annum of the
$25.00 liquidation preference. The Series B Preferred Shares were registered as
part of the Company's shelf Registration Statement on Form S-3 (No. 33-91084),
which was declared effective by the Securities and Exchange Commission on May
18, 1995. In accordance with the terms of the Underwriting Agreement, the
Underwriters also were granted an option to purchase up to an aggregate of
720,000 additional Series B Preferred Shares at the Purchase Price to cover any
over-allotments.
In connection with the issuance of the Series B Preferred Shares, the
holders of the Company's Series A Convertible Preferred Shares exchanged all of
their Series A Convertible Preferred Shares for an equal number of Series A-1
Convertible Preferred Shares. The Series B Preferred Shares rank senior to the
Series A-1 Preferred Shares with respect to distribution rights and rights upon
liquidation, dissolution or winding up of the Company.
ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL STATEMENTS AND EXHIBITS.
(a) Financial Statements of Businesses Acquired.
None
(b) Pro Forma Financial Information.
None
(c) Exhibits
4.1 Underwriting Agreement, dated November 12, 1997, among
the Company, Glimcher Properties Limited Partnership,
Donaldson, Lufkin & Jenrette Securities Corporation,
Prudential Securities Incorporated, BT Alex. Brown
Incorporated and PaineWebber Incorporated.
4.2 Articles Supplementary Classifying Series B Cumulative
Redeemable Preferred Shares of Beneficial Interest.
4.3 Specimen Certificate evidencing Series B Preferred Shares.
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4.4 Amendment No. 1 dated as of November 6, 1997 to Securities
Purchase Agreement among Partnership Acquisition Trust II,
Glimcher Properties Limited Partnership and Glimcher Realty
Trust, dated November 26, 1996.
4.5 Articles Supplementary Classifying Series A-1 Convertible
Preferred Shares.
4.6 Specimen Certificate evidencing Series A-1 Convertible
Preferred Shares.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned hereunto duly authorized.
Date: November 14, 1997
GLIMCHER REALTY TRUST
By: /s/ William G. Cornely
------------------------------------
William G. Cornely,
Senior Vice President and
Chief Financial Officer
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EXHIBIT INDEX
4.1 Underwriting Agreement, dated November 12, 1997, among the
Company, Glimcher Properties Limited Partnership, Donaldson, Lufkin
& Jenrette Securities Corporation, Prudential Securities
Incorporated, BT Alex. Brown Incorporated and PaineWebber
Incorporated.
4.2 Articles Supplementary Classifying Series B Cumulative Redeemable
Preferred Shares of Beneficial Interest.
4.3 Specimen Certificate evidencing Series B Preferred Shares.
4.4 Amendment No. 1 dated as of November 6, 1997 to Securities Purchase
Agreement among Partnership Acquisition Trust II, Glimcher
Properties Limited Partnership and Glimcher Realty Trust, dated
November 26, 1996.
4.5 Articles Supplementary Classifying Series A-1 Convertible Preferred
Shares.
4.6 Specimen Certificate evidencing Series A-1 Convertible Preferred.
Shares
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Exhibit 4.1
4,800,000 Shares
GLIMCHER REALTY TRUST
9 1/4% Series B Cumulative Redeemable Preferred Shares of
Beneficial Interest
UNDERWRITING AGREEMENT
November 12, 1997
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
Prudential Securities Incorporated
BT Alex. Brown Incorporated
PaineWebber Incorporated
As representatives of the
several Underwriters named
in Schedule I hereto
c/o Donaldson, Lufkin & Jenrette
Securities Corporation
277 Park Avenue
New York, New York 10172
Dear Ladies and Gentlemen:
Glimcher Realty Trust, a Maryland real estate investment trust (the
"TRUST"), proposes to issue and sell 4,800,000 shares of its 9 1/4% Series B
Cumulative Redeemable Preferred Shares of Beneficial Interest, par value $.01
per share (Liquidation Preference $25.00 per share)(the "TRUST SHARES") to the
several underwriters named in Schedule I hereto (the "UNDERWRITERS"), for whom
you are
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acting as Representatives (the "REPRESENTATIVES"). The Trust also proposes to
issue and sell to the several Underwriters not more than an additional 720,000
shares of its 9 1/4% Series B Cumulative Redeemable Preferred Shares of
Beneficial Interest, par value $.01 per share (Liquidation Preference $25.00 per
share) (the "ADDITIONAL SHARES"), if requested by the Underwriters as provided
in Section 2 hereof. The Trust Shares and the Additional Shares are hereinafter
referred to collectively as the "SHARES". The Shares to be outstanding after
giving effect to the sales contemplated hereby are hereinafter referred to as
the "SERIES B PREFERRED SHARES".
SECTION 1. Registration Statement and Prospectus. The Trust has
prepared and filed with the Securities and Exchange Commission (the
"COMMISSION") in accordance with the provisions of the Securities Act of 1933,
as amended, and the rules and regulations of the Commission thereunder
(collectively, the "ACT"), a registration statement on Form S-3 (Registration
No. 33-91084), including a preliminary prospectus relating to the registration
of the Shares and such other securities which may be offered from time to time
by the Trust, in accordance with Rule 415 under the Act. Such registration
statement (as amended, if applicable) was declared effective by the Commission
on May 18, 1995. Such registration statement (as amended, if applicable) on the
one hand, and the prospectus constituting a part thereof and the prospectus
supplement relating to the offering of the Shares provided to the Underwriters
by the Trust (whether or not such prospectus supplement is required to be filed
with the Commission by the Trust pursuant to the Act) (the "PROSPECTUS
SUPPLEMENT"), on the other hand, including all documents incorporated therein by
reference pursuant to item 12 of Form S-3 under the Act, as from time to time
amended or supplemented pursuant to the Act, the Securities Exchange Act of
1934, as amended, and the rules and regulations of the Commission thereunder
(collectively called the "EXCHANGE ACT"), are referred to herein as the
"REGISTRATION STATEMENT" and the "PROSPECTUS," respectively; provided,
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however, that a Prospectus Supplement shall be deemed to have supplemented the
Prospectus only with respect to the offering of the Shares to which it relates.
Any registration statement (including any amendment or supplement thereto or
information which is deemed part thereof) filed by the Trust under Rule 462(b)
of the Act (a "RULE 462(b) REGISTRATION STATEMENT") shall be deemed to be part
of the "REGISTRATION STATEMENT" as defined herein and any prospectus or any term
sheet as contemplated by Rule 434 of the Act (a "TERM SHEET") (including any
amendment or supplement thereto or information which is deemed part thereof)
included in such registration statement shall be deemed to be part of the
"Prospectus," as defined herein. All references in this Agreement to financial
statements and schedules and other information which is "contained," "included,"
"described" or "stated" in the Registration Statement or the Prospectus (and all
other references of like import) shall be deemed to mean and include all such
financial statements and schedules and other information which is or is deemed
to be incorporated by reference in the Registration Statement or Prospectus, as
the case may be; and all references in this Agreement to amendments or
supplements to the Registration Statement or the Prospectus shall be deemed to
mean and include, without limitation, even though not specifically stated, any
document filed under the Exchange Act which is or is deemed to be incorporated
by reference in the Registration Statement or the Prospectus, as the case may
be. Capitalized terms used but not otherwise defined herein shall have the
meanings given to those terms in the Prospectus.
SECTION 2. Agreements to Sell and Purchase. On the basis of the
representations and warranties contained in this Agreement, and subject to its
terms and conditions, the Trust agrees to issue and sell, and each Underwriter
agrees, severally and not jointly, to purchase from the Trust at a price per
share of $24.125 (the "PURCHASE PRICE") the number of Trust Shares set forth
opposite the name of such
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Underwriter in Schedule I hereto (or such number of Trust Shares increased as
set forth in Section 9 hereof).
On the basis of the representations and warranties contained in this
Agreement, and subject to its terms and conditions, the Trust agrees to issue
and sell the Additional Shares and the Underwriters shall have the right to
purchase, severally and not jointly, up to 720,000 Additional Shares from the
Trust at the Purchase Price. Additional Shares may be purchased solely for the
purpose of covering over-allotments made in connection with the offering of the
Trust Shares. The Underwriters may exercise their right to purchase Additional
Shares in whole or in part from time to time by giving written notice thereof to
the Trust within 30 days after the date of this Agreement, provided that if such
thirtieth (30th) day is not a New York Stock Exchange (the "NYSE") trading day,
the thirtieth (30th) day will be the next succeeding NYSE trading day. Such
notice shall specify the aggregate number of Additional Shares to be purchased
pursuant to such exercise and the date for payment and delivery thereof, which
date shall be a business day (i) no earlier than two business days after such
notice has been given (and, in any event, no earlier than the Closing Date (as
hereinafter defined)) and (ii) no later than ten business days after such notice
has been given. If any Additional Shares are to be purchased, each Underwriter,
severally and not jointly, agrees to purchase from the Trust the number of
Additional Shares (subject to such adjustments to eliminate fractional shares as
you may determine) which bears the same proportion to the total number of
Additional Shares to be purchased from the Trust as the number of Trust Shares
set forth opposite the name of such Underwriter in Schedule I bears to the total
number of Trust Shares (or such number of Trust Shares increased as set forth in
Section 9 hereof).
SECTION 3. Terms of Public Offering. The Trust is advised by you that
the Underwriters propose (i) to make a public offering (the "OFFERING") of their
respective
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portions of the Shares as soon after the execution and delivery of this
Agreement as in your judgment is advisable (and, if necessary, any
post-effective amendment to the Registration Statement) and (ii) initially to
offer the Shares upon the terms set forth in the Prospectus.
SECTION 4. Delivery and Payment. Delivery to the Underwriters of and
payment for the Trust Shares shall be made at 10:00 A.M., New York City time, on
November 17, 1997 (the "CLOSING DATE") at such place as you shall designate. The
Closing Date and the location of delivery of and form of payment for the Trust
Shares may be varied by agreement between you and the Trust.
Delivery to the Underwriters of and payment for any Additional Shares
to be purchased by the Underwriters shall be made at such place as you shall
designate at 10:00 A.M., New York City time, on the date specified in the
applicable exercise notice given by you pursuant to Section 2 (an "OPTION
CLOSING DATE"). Any such Option Closing Date and the location of delivery of and
the form of payment for such Additional Shares may be varied by agreement
between you and the Trust.
Certificates for the Shares shall be registered in such names and
issued in such denominations as you shall request in writing not later than two
full business days prior to the Closing Date or an Option Closing Date, as the
case may be. Such certificates shall be made available to you for inspection not
later than 9:30 A.M., New York City time, on the business day prior to the
Closing Date or the applicable Option Closing Date, as the case may be.
Certificates in definitive form evidencing the Shares shall be delivered to you
on the Closing Date or the applicable Option Closing Date, as the case may be,
with any transfer taxes thereon duly paid by the Trust, for the respective
accounts of the several Underwriters, against payment to the Trust of the
Purchase Price therefor by wire transfer of Federal or other funds immediately
available in New York City.
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SECTION 5. Agreements of the Trust and the Glimcher Properties Limited
Partnership (the "OPERATING PARTNERSHIP"). Each of the Trust and the Operating
Partnership agrees with you:
(a) In respect of the offering of Shares, the Trust will (i) prepare a
Prospectus Supplement setting forth the number of Shares covered thereby and
their terms not otherwise specified in the Prospectus pursuant to which the
Shares are being issued, the names of the Underwriters participating in the
offering and the number of Shares which each severally has agreed to purchase,
the names of the Underwriters acting as co-managers in connection with the
offering, the price at which the Shares are to be purchased by the Underwriters
from the Trust, the public offering price, the selling concession and
reallowance if any, and such other information as the Underwriters and the Trust
deem appropriate in connection with the offering of the Shares, (ii) file the
Prospectus in a form reasonably acceptable to you pursuant to Rule 424 under the
Securities Act no later than the Commission's close of business on the second
business day following the date of determination of the offering price of the
Shares and (iii) furnish copies of the Prospectus to the Underwriters and to
such dealers as you shall specify in New York City as soon as practicable after
the date of this Agreement in such quantities as you may reasonably request.
(b) At any time when the Prospectus is required to be delivered under
the Act or the Exchange Act in connection with sales of Shares, the Trust will
advise you promptly and, if requested by you, confirm such advice in writing, of
(i) the effectiveness of any amendment to the Registration Statement, (ii) the
transmittal to the Commission for filing of any Prospectus or other supplement
or amendment to the Prospectus to be filed pursuant to the Act, (iii) the
receipt of any comments from the Commission relating to the Registration
Statement, any preliminary prospectus relating to the Shares, the Prospectus or
any of the transactions
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contemplated by this Agreement, (iv) any request by the Commission for
post-effective amendments to the Registration Statement or amendments or
supplements to the Prospectus or for additional information, (v) the issuance by
the Commission of any stop order suspending the effectiveness of the
Registration Statement or of the suspension of qualification of the Shares for
offering or sale in any jurisdiction, or the initiation of any proceeding for
such purposes, and (vi) the happening of any event which makes any statement of
a material fact made in the Registration Statement or the Prospectus untrue or
which requires the making of any additions to or changes in the Registration
Statement or the Prospectus in order to make the statements therein not
misleading. The Trust will make every reasonable effort to prevent the issuance
of any stop order and if at any time the Commission shall issue any stop order
suspending the effectiveness of the Registration Statement, the Trust will make
every reasonable effort to obtain the withdrawal or lifting of such order at the
earliest possible time.
(c) The Trust will furnish you five signed copies without charge of the
Registration Statement as first filed with the Commission and of each amendment
to it, including all exhibits and documents incorporated therein by reference,
and to furnish you and each Underwriter designated by you such number of
conformed copies of the Registration Statement as so filed and of each amendment
to it, without exhibits but including documents incorporated therein by
reference, as you may reasonably request. If applicable, the copies of the
Registration Statement and each amendment thereto furnished to the Underwriters
will be identical to the electronically transmitted copies thereof filed with
the Commission pursuant to EDGAR, except to the extent permitted by Regulation
S-T.
(d) At any time when the Prospectus is required to be delivered under
the Act or the Exchange Act in connection with sales of Shares, not to file any
amendment to the
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Registration Statement or any Rule 462(b) Registration Statement or to make any
amendment or supplement to the Prospectus or any Term Sheet, if applicable, of
which you shall not previously have been advised or to which you or counsel for
the Underwriters shall reasonably object; and to prepare and file with the
Commission, promptly upon your reasonable request, any amendment to the
Registration Statement, Rule 462(b) Registration Statement, Term Sheet, or
amendment or supplement to the Prospectus which, in the opinion of counsel for
the Underwriters, may be necessary in connection with the distribution of the
Shares by you, and to use its best efforts to cause the same to become promptly
effective. If applicable, the Prospectus and any amendments or supplements
thereto furnished to the Underwriters will be identical to the electronically
transmitted copies thereof filed with the Commission pursuant to EDGAR, except
to the extent permitted by Regulation S-T.
(e) Prior to 10:00 A.M., New York City time, on the first business day
after the date of this Agreement and from time to time thereafter for such
period as in the opinion of counsel for the Underwriters a prospectus is
required by law to be delivered in connection with sales by an Underwriter or a
dealer, to furnish in New York City to each Underwriter and any dealer as many
copies of the Prospectus (and of any amendment or supplement to the Prospectus)
and any documents incorporated therein by reference as such Underwriter or
dealer may reasonably request.
(f) If during the period specified in Section 5(e), any event shall
occur or condition shall exist as a result of which, in the opinion of counsel
for the Underwriters or the Trust, it becomes necessary to amend or supplement
the Prospectus in order to make the statements therein, in the light of the
circumstances existing when the Prospectus is delivered to a purchaser, not
misleading, or if, in the opinion of counsel for the Underwriters or the Trust,
it is necessary to amend or supplement the Prospectus to comply with applicable
law, the Trust will forthwith prepare and
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file with the Commission an appropriate amendment or supplement to the
Prospectus (in form and substance reasonably satisfactory to counsel of the
Underwriters) so that the statements in the Prospectus, as so amended or
supplemented, will not in the light of the circumstances when it is so
delivered, be misleading, or so that the Prospectus will comply with applicable
law, and to furnish to each Underwriter and to any dealer as many copies thereof
as such Underwriter or dealer may reasonably request.
(g) The Trust will prior to any public offering of the Shares,
cooperate with you and counsel for the Underwriters in connection with the
registration or qualification of the Shares for offer and sale by the several
Underwriters and by dealers under the state securities or Blue Sky laws of such
jurisdictions as you may request, to continue such registration or qualification
in effect so long as required for distribution of the Shares and to file such
consents to service of process or other documents as may be necessary in order
to effect such registration or qualification; provided, however, that the Trust
shall not be required in connection therewith to qualify as a foreign
corporation in any jurisdiction in which it is not now so qualified or to take
any action that would subject it to general consent to service of process or
taxation other than as to matters and transactions relating to the Prospectus,
the Registration Statement, any preliminary prospectus or the offering or sale
of the Shares, in any jurisdiction in which it is not now so subject.
(h) To make generally available to the Trust's shareholders a
consolidated earnings statement which satisfies the provisions of Section 11(a)
of the Act and Rule 158 thereunder, and, if required by Rule 158 of the Act, to
file such statement as an exhibit to the next periodic report required to be
filed by the Trust under the Exchange Act covering the period when such earnings
statement is released.
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(i) During the period when the Prospectus is required to be delivered
under the Act or the Exchange Act in connection with sales of the Shares, to
file all documents required to be filed by it with the Commission pursuant to
Section 13, 14 or 15 of the Exchange Act within the time periods required by the
Exchange Act.
(j) Whether or not the transactions contemplated in this Agreement are
consummated or this Agreement is terminated, to pay or cause to be paid all
expenses incident to the performance of its obligations under this Agreement,
including: (i) the fees, disbursements and expenses of the Trust's counsel and
the Trust's accountants in connection with the registration and delivery of the
Shares under the Act and all other fees and expenses in connection with the
preparation, printing, filing and distribution of the Registration Statement
(including financial statements and exhibits), any preliminary prospectus, the
Prospectus and all amendments and supplements to any of the foregoing, including
the mailing and delivering of copies thereof to the Underwriters and dealers in
the quantities specified herein, (ii) all costs and expenses related to the
transfer and delivery of the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) all costs of printing, producing or
delivery of this Agreement and any other agreements or documents in connection
with the offering, purchase, sale or delivery of the Shares, (iv) all expenses
in connection with the registration or qualification of the Shares for offer and
sale under the securities or Blue Sky laws or real estate syndication laws of
the several states and all costs of printing or producing any Preliminary and
Supplemental Blue Sky Memoranda in connection therewith (including the filing
fees and fees and disbursements of counsel for the Underwriters in connection
with Blue Sky (but no other matters) registration or qualification and memoranda
relating thereto), (v) all costs and expenses incident to the listing of the
Shares on the NYSE, (vi) the cost of the preparation, issuance and delivery of
certificates representing the Shares, (vii) the
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costs and charges of any transfer agent, registrar and/or depositary, (viii) all
other costs and expenses incident to the performance of the obligations of the
Trust hereunder for which provision is not otherwise made in this Section and
(ix) any expenses incurred by the Trust in connection with a "road show"
presentation to potential investors.
(k) The Trust will use its best efforts to list the Shares on the NYSE
and to maintain the listing of the Shares on the NYSE for a period of not less
than three years after the date of this Agreement.
(l) The Trust will use the net proceeds received by it from the sale of
the Shares in the manner specified in the Prospectus Supplement under "Use of
Proceeds."
(m) The Trust will use its best efforts to continue to qualify as a
"real estate investment trust" ("REIT") under Sections 856 through 860 of the
Internal Revenue Code of 1986, as amended, including the regulations and
published interpretation thereunder (the "INTERNAL REVENUE CODE"), unless the
trustees of the Trust determine that it is no longer in the best interests of
the Trust to be so qualified.
(n) The Trust will use its best efforts to do and perform all things
required or necessary to be done and performed under this Agreement by the Trust
prior to the Closing Date or any Option Closing Date, as the case may be, and to
satisfy all conditions precedent to the delivery of the Shares.
SECTION 6. Representations and Warranties of the Trust and the
Operating Partnership. The Trust and the Operating Partnership jointly and
severally represent and warrant to each Underwriter that:
(a) The Trust meets the requirements for use of Form S-3 and the
Registration Statement on Form S-3 relating to
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the Shares has been prepared by the Trust under the provisions of the Act and
has been filed with and declared effective by the Commission.
(b) The Registration Statement has become effective (other than any
Rule 462(b) Registration Statement to be filed by the Trust after the
effectiveness of this Agreement); any Rule 462(b) Registration Statement filed
after the effectiveness of this Agreement will become effective no later than
10:00 P.M., New York City time, on the date of this Agreement; and no stop order
suspending the effectiveness of the Registration Statement is in effect, and no
proceedings for such purpose are pending before or, to the Trust's knowledge,
threatened by the Commission.
(c) (i) Each document, if any, filed or to be filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus complied or will
comply when so filed in all material respects with the Exchange Act, (ii) the
Registration Statement (other than any Rule 462(b) Registration Statement to be
filed by the Trust after the effectiveness of this Agreement), when it became
effective, did not contain and, as amended, if applicable, 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 not misleading,
(iii) the Registration Statement (other than any Rule 462(b) Registration
Statement to be filed by the Trust after the effectiveness of this Agreement)
and the Prospectus comply and, as amended or supplemented, if applicable, will
comply in all material respects with the Act, (iv) if the Trust is required to
file a Rule 462(b) Registration Statement after the effectiveness of this
Agreement, such Rule 462(b) Registration Statement and any amendments thereto,
when they become effective (A) 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 not misleading and (B) will comply in
all material respects with the Act and (v) the Prospectus does not
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contain and, as amended or supplemented, if applicable, will not contain any
untrue statement of a material fact or omit to state a material fact necessary
to make the statements therein, in the light of the circumstances under which
they were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to statements or omissions in the
Registration Statement or the Prospectus based upon information relating to any
Underwriter furnished to the Trust in writing by such Underwriter through you
expressly for use therein. For all purposes of this Agreement, the amounts of
selling concession and reallowance set forth in the Prospectus and the portions
of the "Underwriting" section set forth in the letter of the Representatives to
the Trust constitute the only information relating to any Underwriter furnished
in writing to the Trust by the Representatives specifically for inclusion in the
Prospectus or the Registration Statement. The Trust has not distributed any
offering material in connection with the offering or sale of the Shares other
than the Registration Statement, the preliminary prospectus, the Prospectus or
any other materials, if any, permitted by the Act.
(d) Each preliminary prospectus filed as part of the Registration
Statement as originally filed or as part of any amendment thereto, or filed
pursuant to Rule 424 under the Act, complied when so filed in all material
respects with the Act, and did not contain 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, in the light of the circumstances under which
they were made, not misleading, except that the representations and warranties
set forth in this paragraph do not apply to statements or omissions in any
preliminary prospectus based upon information relating to any Underwriter
furnished to the Trust in writing by such Underwriter through you expressly for
use therein.
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(e) The Trust has been duly formed and is validly existing as a
Maryland REIT, and is in good standing under the laws of the state of Maryland.
Each of the Operating Partnership, Glimcher Holdings Limited Partnership (the
"GHLP"), Grand Central Limited Partnership (the "GRCLP"), Glimcher Centers
Limited Partnership (the "GCLP"), Glimcher York Associates Limited Partnership
(the "YORK"), Colonial Park Mall Limited Partnership (the "CPMLP") and
Morgantown Mall Associates Limited Partnership (the "MMLP", and together with
the Operating Partnership, GCLP, GHLP, York and GRCLP referred to collectively
herein as the "PARTNERSHIP SUBSIDIARIES") have been duly formed and are validly
existing and in good standing under the laws of their respective jurisdictions
of organization. Glimcher Colonial Park Mall Trust (the "GCPMT" or, the "TRUST
SUBSIDIARY") has been duly organized and is validly existing and in good
standing in its jurisdiction of formation. Each of Olathe Mall LLC (the
"OLATHE"), Great Plains Metro Mall L.L.C. (the "GREAT PLAINS"), Glimcher New
Jersey Metro Mall LLC (the "GNJ"), Elizabeth Metro Mall LLC (the "EMM"),
Glimcher California Metro Mall LLC (the "GCMM"), California Metro Mall LLC (the
"CMM"), Dayton Mall Venture, LLC (the "DAYTON LLC") and Johnson City Venture
L.L.C. (the "JOHNSON CITY" and together with Olathe, GNJ, EMM, GCMM, CMM, Dayton
LLC, and Great Plains, the "LLC SUBSIDIARIES") have been duly organized and are
validly existing and in good standing under the laws of their respective
jurisdictions of formation. Each of Glimcher Properties Corporation (the "GPC"),
Glimcher Centers, Inc. (the "GCI"), Grand Central, Inc. (the "GRCI"), Glimcher
Development Corporation (the "GDC"), Glimcher Johnson City, Inc. (the "GJC
INC."), Glimcher York Inc. (the "YORK INC."), Glimcher Dayton Mall, Inc. (the
"GD MALL"), NJ Metro Mall Urban Renewal, Inc. (the "NJ MMUR") and Glimcher
Holdings, Inc. (the "GHI", and together with GPC, GCI, GJC Inc., York Inc., GD
Mall, NJ MMUR and GRCI are referred to collectively herein as the "CORPORATE
SUBSIDIARIES", and the Partnership Subsidiaries, the Trust Subsidiary, the LLC
Subsidiaries and the Corporate Subsidiaries are referred to herein collectively
as the
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"SUBSIDIARIES") have been duly formed and are validly existing and in good
standing under the laws of their respective jurisdictions of organization. The
Corporate Subsidiaries, the LLC Subsidiaries and the Partnership Subsidiaries,
are the only subsidiaries (direct or indirect) of the Trust.
(f) The Trust and each of the Subsidiaries have full trust, corporate,
partnership and/or limited liability company power to own or lease their
respective properties and conduct their respective businesses as described in
the Prospectus; and the Trust and the Operating Partnership have full trust or
partnership, as the case may be, power to enter into this Agreement and to carry
out all the terms and provisions hereof to be carried out by it. The Trust and
the Subsidiaries are duly qualified to transact business as foreign entities,
and are in good standing under the laws of all other jurisdictions where the
ownership or leasing of their respective properties or the conduct of their
respective businesses requires such qualification, except where the failure to
be so qualified would not have a material adverse effect on the business,
prospects, financial condition or results of operations of the Trust and the
Subsidiaries, taken as a whole.
(g) Except as disclosed in the Prospectus, there are not outstanding
(i) securities, partnership interests or obligations of the Trust or any
Subsidiary convertible into or exchangeable for any capital stock of the Trust
or ownership interest in the Subsidiaries, (ii) warrants, rights or options to
subscribe for or purchase from the Trust or any Subsidiary any such capital
stock or ownership interest or any such convertible or exchangeable securities,
partnership interests or obligations, or (iii) obligations of the Trust or any
Subsidiary to issue any shares of capital stock or ownership interest, any such
convertible or exchangeable securities, partnership interests or obligations, or
any such warrants, rights or options.
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(h) The Trust has an authorized, issued and outstanding capitalization
as set forth in the Prospectus. All of the issued shares of capital stock of the
Trust have been duly authorized and validly issued and are fully paid and
nonassessable (except that shareholders of the Trust may be subject to personal
liability with respect to certain claims for torts, contracts, taxes and
statutory and other liabilities in some jurisdictions). The Shares have been
duly authorized by all necessary trust action and at the Closing Date or the
related Option Closing Date (as the case may be), when issued and delivered to
the Underwriters against payment therefor as provided by this Agreement, will be
validly issued, fully paid and nonassessable (except that shareholders of the
Trust may be subject to personal liability with respect to certain claims for
torts, contracts, taxes and statutory and other liabilities in some
jurisdictions), will have been duly executed and delivered by the Trust and will
not be subject to any preemptive or similar right. The description of the Shares
contained in the Prospectus is, and at the closing date will be, complete and
accurate in all material respects. No holders of outstanding shares of capital
stock of the Trust are entitled as such to any Shares, and no holder of
securities of the Trust has any right which has not been exercised or waived to
require the Trust to register the offer or sale of any securities owned by such
holder under the Act in the public offering contemplated by this Agreement.
(i) The outstanding equity interests of each Subsidiary, other than EMM
and CMM, have been duly authorized and validly issued and are fully paid and
non-assessable, except to the extent shown in Exhibit 6(i) hereto, and are owned
by the Trust free and clear of all liens, encumbrances, equities and claims; and
no options, warrants or other rights to purchase, agreements or other
obligations to issue or other rights to convert any obligations into ownership
interests in each Subsidiary are outstanding, except as described in the
Prospectus, or as provided for in any organizational documents or operating
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agreements of any Subsidiary, or except as set forth in Exhibit 6(i) hereto.
Exhibit 6(i) is a true and correct organizational structure chart identifying
all owners of equity interests of each Subsidiary and sets forth the percentage
ownership for such owners. As of the Closing Date, (i) the Trust is the sole
shareholder of GPC and (ii) the Trust, directly and indirectly, will own a 90.1%
partnership interest in the Operating Partnership.
(j) Each of the partnership, operating and joint venture agreements to
which the Trust or any of the Subsidiaries is a party, and which relates to real
property described in the Prospectus, (i) has, other than EMM and CMM, been duly
authorized, executed and delivered by such applicable party and constitutes the
valid agreement thereof, enforceable in accordance with its terms, except as
limited by (a) the effect of bankruptcy, insolvency, reorganization, moratorium
or other similar laws now or hereafter in effect relating to or affecting the
rights of remedies of creditors or (b) the effect of general principles of
equity, whether enforcement is considered in a proceeding in equity or at law,
and the discretion of the court before which any proceeding therefor may be
brought; and (ii) the execution, delivery and performance of any of such
agreements by the Trust or the Subsidiaries, as applicable, did not, at the time
of execution and delivery, and does not, constitute a breach of, or default
under, (a) the charter, declaration of trust, partnership agreement, operating
agreement or by-laws or other organizational documents of such party or (b) any
other material contract, lease or other instrument to which such party is a
party or by which its properties may be bound or any law, administrative
regulation or administrative or court decree, except where such breach or
default would not have a material adverse affect on the business, prospects,
financial condition or results of operations of the Trust and the Subsidiaries,
taken as a whole.
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(k) The authorized capital stock of the Trust conforms in all material
respects as to legal matters to the description thereof contained in the
Prospectus.
(l) Neither the Trust nor any of the Subsidiaries is in violation of
any term or provision of its declaration of trust, certificate of incorporation,
by-laws, partnership agreements or other organizational documents, as the case
may be; no default exists, and no event has occurred which, with notice of lapse
of time or both, would constitute a default in the performance and observance of
any term, covenant or condition of any indenture, mortgage, deed of trust, lease
or other agreement or instrument to which the Trust or any Subsidiary is a party
or by which the Trust, the Subsidiaries or any of their respective properties is
bound or may be affected except such as would not result in any material adverse
effect on the business, prospects, financial condition or results of operations
of the Trust and the Subsidiaries, taken as a whole.
(m) The execution, delivery and performance of this Agreement by the
Trust and the Operating Partnership, the compliance by the Trust and the
Operating Partnership with all the provisions hereof and the consummation of the
transactions contemplated hereby will not (i) require any consent, approval,
authorization, the registration or other order of, or qualification with, any
court or governmental body or agency (except such as may be required and shall
be obtained as provided by this Agreement, under the securities or Blue Sky laws
of the various states), (ii) conflict with or constitute a breach of any of the
terms or provisions of, or a default under, the declaration of trust, charter,
by-laws, partnership agreement, operating agreement (or other organizational
documents), as the case may be, of the Trust or any of the Subsidiaries or any
indenture, loan agreement, mortgage, lease or other agreement or instrument that
is material to the Trust and the Subsidiaries, taken as a whole, to which the
Trust or any of the Subsidiaries is a party or by which the Trust or any of the
Subsidiaries or
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their respective property is bound, (iii) violate or conflict with any
applicable law or any rule, regulation, judgment, order or decree of any court
or any governmental body or agency having jurisdiction over the Trust, or any of
the Subsidiaries or their respective property or (iv) result in the suspension,
termination or revocation of any Authorization (as defined below) of the Trust
or any of the Subsidiaries or any other impairment of the rights of the holder
of any such Authorization.
(n) There are no legal or governmental proceedings pending or
threatened to which the Trust or any of the Subsidiaries is or, to the Trust's
knowledge, could be a party or to which any of their respective property is or
could be subject that are required to be described in the Prospectus and are not
so described; nor are there any statutes, regulations, contracts or other
documents that are required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration Statement that are not
so described or filed as required.
(o) Except as otherwise disclosed in the Prospectus or as set forth in
a separate writing delivered to the Underwriters on the date hereof, (i) neither
the Trust, any of the Subsidiaries nor, to the best knowledge of the Trust, any
other owners of the property at any time or any other party has at any time,
handled, stored, treated, transported, manufactured, spilled, leaked, or
discharged, dumped, transferred or otherwise disposed of or dealt with,
Hazardous Materials (as hereinafter defined) on, to or from the Properties (a)
defined in the Prospectus Supplement, other than in material compliance with all
applicable Environmental Statutes (as hereinafter defined) and in connection
with the ordinary use of residential, retail or commercial properties owned by
the Trust; (ii) the Trust will not use the Properties or any subsequently
acquired properties for the purpose of handling, storing, treating,
transporting, manufacturing, spilling, leaking, discharging,
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dumping, transferring or otherwise disposing of or dealing with Hazardous
Materials other than immaterial compliance with all applicable Environmental
Statutes and in connection with the ordinary use of residential, retail or
commercial properties owned by the Trust; (iii) neither the Trust nor any of the
Subsidiaries knows of any seepage, leakage, discharge, release, emission, spill,
or dumping of Hazardous Materials on any property which might materially and
adversely affect the Properties; (iv) neither the Trust nor any of the
Subsidiaries has received any notice of, or has any knowledge of any occurrence
or circumstance which, with notice or passage of time or both, would give rise
to a material claim under or pursuant to any Environmental Statute or under
common law, pertaining to Hazardous Materials on or originating from any of the
Properties or any assets described in the Prospectus; (v) neither the Properties
nor any other land owned by the Trust or any of the Subsidiaries is included or,
to the best of the Trust's knowledge, proposed for inclusion on the National
Priorities List issued pursuant to CERCLA (as hereinafter defined) by the United
States Environmental Protection Agency (the "EPA") or, to the best of the
Trust's knowledge, proposed for inclusion on any similar list of inventory
issued pursuant to any other Environmental Statute or issued by any other
Governmental Authority (as hereinafter defined) or has been the subject of an
investigation or inquiry by any Governmental Authority with respect to Hazardous
Materials; and (vi) the Trust, the Subsidiaries and the Properties are in
material compliance with all Environmental Statutes and to the best of the
Trust's knowledge, the Trust and the Subsidiaries possess all permits,
registrations and authorizations required to operate the Properties.
(p) As used herein, "Hazardous Materials" shall mean any substance
defined or regulated as a hazardous material, hazardous waste, hazardous
substance, toxic substance, pollutant or contaminant or by any federal, state or
local law, ordinance, rule or regulation for the protection of human health or
the environment (including without
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limitation the Comprehensive Environmental Response, Compensation, and Liability
Act of 1980, 42 U.S.C. 9601 et seq. (the "CERCLA"), the Hazardous Materials
Transportation Act, 49 U.S.C. Section 1801 et seq., the Resource Conservation
and Recovery Act, 42 U.S.C. Section 6901 et seq., the Emergency Planning and
Community Right-to-Know Act of 1986, 42 U.S.C. Section 11001 et seq., the Toxic
Substances Control Act, 15 U.S.C. Section 2601 et seq., the Federal Insecticide,
Fungicide and Rodenticide Act, 7 U.S.C. Section 136 et seq., the Clean Air Act,
42 U.S.C. Section 7401 et seq., the Clean Water Act (Federal Water Pollution
Control Act), 33 U.S.C. Section 1251 et seq., the Safe Drinking Water Act, 42
U.S.C. Section 300f et seq., and the Occupational Safety and Health Act, 29
U.S.C. Section 651 et seq., as any of the above statutes may be amended from
time to time, and in the regulations promulgated pursuant to each of the
foregoing (individually, an "ENVIRONMENTAL STATUTE") or by any federal, state or
local governmental authority having or claiming jurisdiction over the properties
and assets described in the Prospectus (a "GOVERNMENTAL AUTHORITY")) or any
substance which is or contains petroleum.
(q) The Trust and each Subsidiary are in compliance in all material
respects with all presently applicable provisions of the Employee Retirement
Income Security Act of 1974, as amended, including the regulations and published
interpretations thereunder (the "ERISA"); no "reportable event" (as defined in
ERISA) has occurred with respect to any "pension plan" (as defined in ERISA for
which the Trust or any Subsidiary would have any material liability; neither the
Trust nor any Subsidiary has incurred and neither expects to incur any material
liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any "pension plan" or (ii) Sections 4971 of the Internal
Revenue Code; and each "pension plan" in which employees or former employees of
the Trust or any Subsidiary participate that is intended to be qualified under
Section 401(a) of the Internal Revenue Code is so qualified in all material
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respects and nothing has occurred, whether through any action or by failure to
act, which would cause the loss of such qualification.
(r) Neither the Trust nor any of the Subsidiaries is in violation of
any federal or state law or regulation relating to occupational safety and
health and the Trust and the Subsidiaries have received all permits, licenses or
other approvals required of them under applicable federal and state occupational
safety and health and regulations to conduct their respective businesses, and
the Trust and each of the Subsidiaries is in compliance with all terms and
conditions of any such permit, license or approval, except any such violation of
law or regulation, failure to receive required permits, licenses or other
approvals or failure to comply with the terms and conditions of such permits,
licenses or approvals which would not, singly or in the aggregate result in a
material adverse effect on the business, prospects, financial condition or
results of operations of the Trust and the Subsidiaries, taken as a whole,
except as described in the Prospectus.
(s) Each of the Trust and the Subsidiaries has such permits, licenses,
consents, exemptions, franchises, authorizations and other approvals (each, an
"AUTHORIZATION") of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory organizations and all
courts and other tribunals, including, without limitation, under any applicable
Environmental Laws, as are necessary to own, lease, license and operate its
respective properties and to conduct its business, except where the failure to
have any such Authorization or to make any such filing or notice would not,
singly or in the aggregate, have a material adverse effect on the business,
prospects, financial condition or results of operations of the Trust and the
Subsidiaries, taken as a whole. Each such Authorization is valid and in full
force and effect and each of the Trust and the Subsidiaries is in compliance
with all the terms and
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conditions thereof and with the rules and regulations of the authorities and
governing bodies having jurisdiction with respect thereto; and no event has
occurred (including, without limitation, the receipt of any notice from any
authority or governing body) which allows or, after notice or lapse of time or
both, would allow, revocation, suspension or termination of any such
Authorization or results or, after notice or lapse of time or both, would result
in any other impairment of the rights of the holder of any such Authorization;
except where such failure to be valid and in full force and effect or to be in
compliance, the occurrence of any such event or the presence of any such
restriction would not, singly or in the aggregate, have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Trust and the Subsidiaries, taken as a whole.
(t) This Agreement has been duly authorized, executed and delivered by
the Trust and the Operating Partnership, and is a valid, binding agreement of
the Trust and the Operating Partnership, and enforceable against the Trust and
the Operating Partnership in accordance with its terms.
(u) Coopers & Lybrand L.L.P., who have certified certain financial
statements of the Trust and the Subsidiaries and delivered their report with
respect to the audited consolidated financial statements and schedules included
in the Registration Statement and each of the Prospectus are independent public
accountants with respect to the Trust and the Subsidiaries as required by the
Act.
(v) The consolidated financial statements included in the Registration
Statement and the Prospectus (and any amendment or supplement thereto), together
with related schedules and notes, present fairly the consolidated financial
position, results of operations and changes in financial position of the Trust
and the Subsidiaries on the basis stated therein at the respective dates or for
the respective periods to which they apply; such statements and
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related schedules and notes have been prepared in accordance with generally
accepted accounting principles consistently applied throughout the periods
involved, except as disclosed therein; the supporting schedules, if any,
included in the Registration Statement present fairly in accordance with
generally accepted accounting principles the information required to be stated
therein; and the other financial and statistical information and data set forth
in the Registration Statement and the Prospectus (and any amendment or
supplement thereto) are, in all material respects, accurately presented and
prepared on a basis consistent with such financial statements and the books and
records of the Trust. The selected financial data set forth under the caption
"Selected Consolidated Financial and Other Data" in the Registration Statement
and the Prospectus fairly present, on the basis stated in the Registration
Statement and the Prospectus, the information included therein. The pro forma
financial statements and other pro forma financial information included in the
Registration Statement and the Prospectus comply in all material respects with
the applicable requirements of Rule 11-02 of Regulation S-X of the Commission
and the pro forma adjustments have been properly applied to the historical
amounts in the compilation of such statements and the assumptions used in the
preparation thereof are, in the opinion of the Trust, reasonable.
(w) The Trust is not and, after giving effect to the offering and sale
of the Shares and the application of the proceeds thereof as described in the
Prospectus, will not be, an "INVESTMENT COMPANY" as such term is defined in the
Investment Company Act of 1940, as amended.
(x) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there has not occurred any material adverse effect or any development involving
a prospective material adverse effect
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on the business, prospects, financial condition or results of operations of the
Trust and the Subsidiaries, taken as a whole, (ii) there has not been any
material adverse effect or any development involving a prospective material
adverse effect in the capital stock or in the long-term debt of the Trust or any
of the Subsidiaries, (iii) neither the Trust nor any of the Subsidiaries has
incurred any material liability or obligation, direct or contingent, nor entered
into any material transaction not in the ordinary course of business and (iv)
the Trust has not purchased any of its outstanding shares of beneficial
interest, nor declared, paid or otherwise made any dividend or distribution of
any kind of its shares of beneficial interest.
(y) The Trust and each Subsidiary maintain a system of internal
accounting controls sufficient to provide reasonable assurance that: (i)
transactions are executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted
accounting principles and to maintain asset accountability; (iii) access to
assets is permitted only in accordance with management's general or specific
authorization; and (iv) the recorded accountability for assets is compared with
the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences; and
(aa) The Trust has not, directly or indirectly, (i) taken any action
designed to cause or to result in, or that has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of the
price of any security of the Trust to facilitate the sale or resale of the
Securities or (ii) since the filing of the Registration Statement (A) sold, bid
for, purchased, or paid anyone any compensation for soliciting purchases of, the
Securities or (B) paid or agreed to pay to any person any compensation for
soliciting another to purchase any other securities of the Trust.
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(bb) The Trust has not distributed and, prior to the later of (i) the
Closing Date and (ii) the completion of the distribution of the Securities, will
not distribute any offering material in connection with the offering and sale of
the Securities other than the Registration Statement or any amendment thereto,
any Preliminary Prospectus or the Prospectus or any amendment or supplement
thereto, or other materials, if any, permitted by the Act.
(cc) The Trust and each Subsidiary have good and indefeasible title in
fee simple to all of the Properties and good and marketable title to all
personal property owned by each of them, in each case free and clear of any
security interests, liens, encumbrances, equities, claims and other defects,
except such as do not materially and adversely affect the value of any
Individual Significant Property (defined below) or all Properties (taken as a
whole) and do not interfere with the use made or proposed to be made of any
individual Significant Property or all Properties (taken as a whole) by the
Trust or any Subsidiary, and any Properties and buildings held under lease by
the Trust or by any Subsidiary are held under valid, subsisting and enforceable
leases, with such exceptions as are not material and do not interfere with the
use made or proposed to be made of such Significant Property or all Properties
(taken as a whole) by the Trust or by any Subsidiary, in each case except as
described in or contemplated by the Prospectus. For purposes of this Section
6(cc), a "Significant Property" shall mean a Property that has a book value
(without regard to any minority interest held by any person), as of June 30,
1997, of at least $10 million.
(dd) The Trust and each Subsidiary are insured by insurers of
recognized financial responsibility against such losses and risks and in such
amounts as are prudent and customary in the businesses in which they are
engaged; and none of the Trust or any of the Subsidiaries have any reason to
believe that they will not be able to renew their existing insurance coverage as
and when such coverage
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<PAGE> 27
expires or to obtain similar coverage from similar insurers as may be necessary
to continue their business at a cost that would not have a material adverse
effect on the business, prospects, financial condition or results of operations
of the Trust and the Subsidiaries taken as a whole, except as described in or
contemplated by the Prospectus.
(ee) The Trust and each Subsidiary have filed all foreign, federal,
state and local tax returns that are required to be filed or have requested
extensions thereof (except in any case in which the failure so to file would not
have a material adverse effect on the business, prospects, financial condition
or results of operations of Trust and the Subsidiaries taken as a whole) and
have paid all taxes required to be paid by them and any other assessment, fine
or penalty levied against them, to the extent that any of the foregoing is due
and payable, except for any such assessment, fine or penalty that is currently
being contested in good faith or as described in the Prospectus. Such tax
returns are true, correct, and complete in all material respects.
(ff) The Trust has been and is organized and operated in conformity
with the requirements for qualification as a REIT under Sections 856 through 860
of the Internal Revenue Code and the rules and regulations thereunder and the
Trust's present method of operation does and will enable it to continue to meet
the requirements for taxation as a REIT under the Internal Revenue Code and the
Operating Partnership, the other Partnership Subsidiaries and the LLC
Subsidiaries will be treated for federal income tax purposes as partnerships and
not as associations taxable as corporations or as publicly-traded partnerships.
(gg) The Shares have been approved for listing on the NYSE, subject to
official notice of issuance.
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(hh) (i) Neither the Trust nor any Subsidiary knows of any violation of
any municipal, state or federal law, rule or regulation (including those
pertaining to environmental matters) concerning the Properties (as defined in
the Prospectus) or any part thereof which would have a material adverse effect
on the business, prospects, financial condition or results of operations of the
Trust and the Subsidiaries, taken as a whole; (ii) each of the Properties
complies with all applicable zoning laws, ordinances, regulations and deed
restrictions or other covenants in all material respects and, if and to the
extent there is a failure to comply, such failure does not materially impair the
value of any of the Properties and will not result in a forfeiture or reversion
of title; (iii) neither the Trust nor any Subsidiary has received from any
governmental authority any written notice of any condemnation of or zoning
change affecting the Properties or any part thereof, and neither the Trust nor
any Subsidiary knows of any such condemnation or zoning change which is
threatened and, in either case, which if consummated would have a material
adverse effect on the, business, prospects, financial condition or results of
operations of the Trust and the Subsidiaries, taken as a whole; (iv) all liens,
charges, encumbrances, claims, or restrictions on or affecting the properties
and assets (including the Properties) of the Trust or any of the Subsidiaries
that are required to be described in the Prospectus are disclosed therein; and
(v) no lessee of any portion of any of the Properties is in default under any of
the leases governing such properties and there is no event which, but for the
passage of time or the giving of notice or both would constitute a default under
any of such leases, except such defaults or events which, but for the passage of
time or giving of notice or both, will constitute a default that would not have
a material adverse effect on the business prospects, financial condition or
results of operations of the Trust and the Subsidiaries, taken as a whole except
as disclosed or incorporated by reference in the Prospectus.
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(ii) No labor dispute with the employees of the Trust or any of the
Subsidiaries exists, or, to the Trust's knowledge, is threatened or imminent,
that would result in a material adverse effect on the business, prospects,
financial condition or results of operations of the Trust and the Subsidiaries,
taken as a whole, except as described in the Prospectus.
(jj) The Trust and the Subsidiaries own or possess, or can acquire on
reasonable terms, all material patents, trademarks, service marks, trade names,
licenses, copyrights and proprietary and other confidential information
currently employed by them in connection with their respective businesses, and
neither the Trust nor any of the Subsidiaries has received any notice of
infringement of or conflict with asserted rights of any third party with respect
to the foregoing which, singly or in the aggregate, if the subject of an
unfavorable decision, ruling or finding, would result in a material adverse
effect on the business, prospects, financial condition or results of operations
of the Trust and the Subsidiaries, taken as a whole, except as described in the
Prospectus.
(kk) The Trust has issued and sold 34,000 shares of its Series A
Convertible Preferred Shares to Partnership Acquisition Trust II, a Delaware
business trust "PAT II"). The proceeds of such sale were contributed by the
Trust to the Operating Partnership in exchange for 34,000 preferred units of
limited partnership interest (the "PREFERRED INTEREST") of the Operating
Partnership. The rights, preferences, terms and conditions of the Series A
Convertible Preferred Shares issued to PAT II are equivalent in all material
respects to the terms and conditions of the Preferred Interest issued to the
Trust.
SECTION 7. Indemnification. (a) The Trust and the Operating
Partnership, jointly and severally, agree to indemnify and hold harmless each
Underwriter, its directors, its officers and each person, if any, who controls
any
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Underwriter within the meaning of Section 15 of the Act or Section 20 of the
Exchange Act, from and against any and all losses, claims, damages, liabilities
and judgments (including, without limitation, any legal or other expenses
incurred in connection with investigating or defending any matter, including any
action, that could give rise to any such losses, claims, damages, liabilities or
judgments) caused by any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement (or any amendment
thereto), the Prospectus (or any amendment or supplement thereto) or any
preliminary prospectus, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages, liabilities or judgments are caused by any such untrue statement or
omission or alleged untrue statement or omission based upon information relating
to any Underwriter furnished in writing to the Trust by such Underwriter through
you expressly for use therein.
(b) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Trust and the Operating Partnership, the directors, its
officers who sign the Registration Statement and each person, if any, who
controls the Trust within the meaning of Section 15 of the Act or Section 20 of
the Exchange Act, to the same extent as the foregoing indemnity from the Trust
and the Operating Partnership to such Underwriter but only with reference to
information relating to such Underwriter furnished in writing to the Trust by
such Underwriter through you expressly for use in the Registration Statement (or
any amendment thereto), the Prospectus (or any amendment or supplement thereto)
or any preliminary prospectus.
(c) In case any action shall be commenced involving any person in
respect of which indemnity may be sought pursuant to Section 7(a) or 7(b) (the
"INDEMNIFIED PARTY"), the indemnified party shall promptly notify the person
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against whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party shall assume the defense of such action, including
the employment of counsel reasonably satisfactory to the indemnified party and
the payment of all fees and expenses of such counsel, as incurred (except that
in the case of any action in respect of which indemnity may be sought pursuant
to both Sections 7(a) and 7(b), the Underwriters shall not be required to assume
the defense of such action pursuant to this Section 7(c), but may employ
separate counsel and participate in the defense thereof however, the fees and
expenses of such counsel, except as provided below, shall be at the expense of
such Underwriter). Any indemnified party shall have the right to employ separate
counsel in any such action and participate in the defense thereof, but the fees
and expenses of such counsel shall be at the expense of the indemnified party
unless (i) the employment of such counsel and payment of their fees and expenses
shall have been specifically authorized in writing by the indemnifying party,
(ii) the indemnifying party shall have failed to assume the defense of such
action or employ counsel reasonably satisfactory to the indemnified party or
(iii) the named parties to any such action (including any impleaded parties)
include both the indemnified party and the indemnifying party, and the
indemnified party shall have been advised by such counsel that there may be one
or more legal defenses available to it which are different from or additional to
those available to the indemnifying party (in which case the indemnifying party
shall not have the right to assume the defense of such action on behalf of the
indemnified party). In any such case, the indemnifying party shall not, in
connection with any one action or separate but substantially similar or related
actions in the same jurisdiction arising out of the same general allegations or
circumstances, be liable for the fees and expenses of more than one separate
firm of attorneys (in addition to any local counsel) for all indemnified parties
and all such fees and expenses shall be reimbursed as they are incurred. Such
firm shall be designated in writing by
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Donaldson, Lufkin & Jenrette Securities Corporation, in the case of parties
indemnified pursuant to Section 7(a), and by the Trust, in the case of parties
indemnified pursuant to Section 7(b). The indemnifying party shall indemnify and
hold harmless the indemnified party from and against any and all losses, claims,
damages, liabilities and judgments by reason of any settlement of any action (i)
effected with its written consent, which consent shall not be unreasonably
withheld, or (ii) effected without its written consent if the settlement is
entered into more than (20) business days after the indemnifying party shall
have received a request from the indemnified party for reimbursement for the
fees and expenses of counsel (in any case where such fees and expenses are at
the expense of the indemnifying party) and, prior to the date of such
settlement, the indemnifying party shall have failed to comply with such
reimbursement request, except to the extent that the amount of such fees and
expenses is being contested in good faith. No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement or
compromise of, or consent to the entry of judgment with respect to, any pending
or threatened action in respect of which the indemnified party is or could have
been a party and indemnity or contribution may be or could have been sought
hereunder by the indemnified party, unless such settlement, compromise or
judgment (i) includes an unconditional release of the indemnified party from all
liability on claims that are or could have been the subject matter of such
action without imposing any restrictions or obligations on the indemnified party
and (ii) does not include a statement as to or an admission of fault,
culpability or a failure to act by or on behalf of the indemnified party.
(d) To the extent the indemnification provided for in this Section 7
is unavailable to an indemnified party or insufficient in respect of any losses,
claims, damages, liabilities or judgments referred to therein, then each
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indemnifying party, in lieu of indemnifying such indemnified party, shall
contribute to the amount paid or payable by such indemnified party as a result
of such losses, claims, damages, liabilities and judgments (i) in such
proportion as is appropriate to reflect the relative benefits received by the
Trust and the Operating Partnership on the one hand and the Underwriter on the
other hand from the offering of the Shares or (ii) if the allocation provided by
clause 7(d)(i) above is not permitted by applicable law, in such proportion as
is appropriate to reflect not only the relative benefits referred to in clause
7(d)(i) above but also the relative fault of the Trust and the Operating
Partnership on the one hand and the Underwriters on the other hand in connection
with the statements or omissions which resulted in such losses, claims, damages,
liabilities or judgments, as well as any other relevant equitable
considerations. The relative benefits received by the Trust and the Operating
Partnership on the one hand and the Underwriter on the other hand shall be
deemed to be in the same proportion as the total net proceeds from the offering
(before deducting expenses) received by the Trust, and the total underwriting
discounts and commissions received by the Underwriters, bear to the total price
to the public of the Shares, in each case as set forth in the table on the cover
page of the Prospectus. The relative fault of the Trust on the one hand and the
Underwriters on the other hand shall be determined by reference to, among other
things, whether the untrue or alleged untrue statement of a material fact or the
omission or alleged omission to state a material fact relates to information
supplied by the Trust or the Underwriters and the parties' relative intent,
knowledge, access to information and opportunity to correct or prevent such
statement or omission.
The Trust, the Operating Partnership and the Underwriters agree that it
would not be just and equitable if contribution pursuant to this Section 7(d)
were determined by pro rata allocation (even if the Underwriters were treated as
one entity for such purpose) or by any other
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method of allocation which does not take account of the equitable considerations
referred to in the immediately preceding paragraph. The amount paid or payable
by an indemnified party as a result of the losses, claims, damages, liabilities
or judgments referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other
expenses incurred by such indemnified party in connection with investigating or
defending any matter, including any action, that could have given rise to such
losses, claims, damages, liabilities or judgments. Notwithstanding the
provisions of this Section 7, no Underwriter shall be required to contribute any
amount in excess of the amount by which the total price at which the Shares
underwritten by it and distributed to the public were offered to the public
exceeds the amount of any damages which such Underwriter has otherwise been
required to pay by reason of such untrue or alleged untrue statement or omission
or alleged omission. No person guilty of fraudulent misrepresentation (within
the meaning of Section 11(f) of the Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation. The
Underwriters' obligations to contribute pursuant to this Section 7(d) are
several in proportion to the respective number of Shares purchased by each of
the Underwriters hereunder and not joint.
(e) The remedies provided for in this Section 7 are not exclusive and
shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
SECTION 8. Conditions of Underwriters' Obligations. The several
obligations of the Underwriters to purchase the Trust Shares under this
Agreement are subject to the satisfaction of each of the following conditions:
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<PAGE> 35
(a) All the representations and warranties of the Trust and the
Operating Partnership contained in this Agreement shall be true and correct on
the Closing Date with the same force and effect as if made on and as of the
Closing Date.
(b) At the Closing Date no stop order suspending the effectiveness of
the Registration Statement shall have been issued and no proceedings for that
purpose shall have been commenced or shall be pending before or, to the Trust's
knowledge, contemplated by the Commission.
(c) The Prospectus and any amendment or supplement thereto shall have
been filed with the Commission in the manner and within the time period required
by Rules 434 and 424(b) under the Act.
(d) Since the respective dates as of which information is given in the
Prospectus other than as set forth in the Prospectus (exclusive of any
amendments or supplements thereto subsequent to the date of this Agreement), (i)
there shall not have occurred any change or any development involving a
prospective change in the condition, financial or otherwise, or the earnings,
business, management or operations of the Trust and the Subsidiaries, taken as a
whole, (ii) there shall not have been any change or any development involving a
prospective change in the capital stock or in the long-term debt of the Trust or
any of the Subsidiaries and (iii) neither the Trust nor any of the Subsidiaries
shall have incurred any liability or obligation, direct or contingent, the
effect of which, in any such case described in clause 8(d)(i), 8(d)(ii) or
8(d)(iii), in your reasonable judgment, is material and adverse and, in your
reasonable judgment, makes it impracticable to market the Shares on the terms
and in the manner contemplated in the Prospectus.
(e) You shall have received on the Closing Date a certificate dated the
Closing Date, signed by the Chief
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<PAGE> 36
Executive Officer and the Chief Financial Officer of the Trust and GPC on behalf
of the Operating Partnership confirming the matters set forth in Sections 8(a),
8(b), 8(c) and 8(d) that the Trust has complied with all of the agreements and
satisfied all of the conditions herein contained and required to be complied
with or satisfied by the Trust on or prior to the Closing Date.
(f) You shall have received on the Closing Date opinions (satisfactory
to you and counsel for the Underwriters), dated the Closing Date, of (i) George
A. Schmidt, Esq., in his capacity as general counsel of the Trust, (ii) Ballard
Spahr Andrews & Ingersoll, special Maryland counsel to the Trust, (iii)
Brownstein Hyatt Farber & Strickland, special Colorado counsel to the Trust, and
(iv) Robinson Silverman Pearce Aronsohn & Berman LLP, special counsel to the
Trust, to the effect that:
(i) the Trust has been duly formed and is validly existing as a
Maryland REIT in good standing under the laws of the State of Maryland
and is duly qualified to transact business. The Trust is in good
standing under the laws of all other jurisdictions where the ownership
or leasing of its properties or the conduct of its business requires
such qualification, except where the failure to be so qualified does
not amount to a material liability or disability to the Trust and the
Subsidiaries, taken as a whole. Each of the Subsidiaries has been duly
organized and is validly existing as a general or limited partnership
or corporation or limited liability company in good standing under the
laws of the jurisdiction of its organization, and is qualified to
transact business and is in good standing under the laws of all other
jurisdictions where the ownership or leasing of its properties or the
conduct of its business requires such qualification, except where the
failure to be so qualified does not amount to a material liability or
disability to the Trust and the Subsidiaries, taken as a whole;
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<PAGE> 37
(ii) the Trust and each of the Subsidiaries have full trust,
corporate, partnership or limited liability power to own or lease their
respective properties and conduct their respective businesses as
described and the Prospectus and the Trust and the Operating
Partnership have full trust, corporate or limited liability power to
enter into this Agreement and to carry out all the terms and provisions
hereof and thereof to be carried out by it in all material respects;
(iii) the authorized capital stock of the Trust conforms as to
legal matters in all material respects to the description thereof
contained in the Prospectus. All of the shares of beneficial interest
of the Trust has been duly authorized and the shares of beneficial
interest of the Trust outstanding are validly issued, fully paid and
non-assessable (except that shareholders of the Trust may be subject to
personal liability with respect to certain claims for tort, contract,
taxes and statutory and other liability in some jurisdictions);
(iv) the Trust Shares have been duly authorized and, when
executed and delivered to the Underwriters against payment therefor in
accordance with this Agreement, will be validly issued, fully paid and
non-assessable (except that shareholders of the Trust may be subject to
personal liability with respect to certain claims for tort, contract,
taxes and statutory and other liability in some jurisdictions), and the
execution and delivery of the Trust Shares have been duly authorized by
all necessary trust action, and the Trust Shares have been duly
executed and delivered by the Trust, and, assuming due authorization,
execution and delivery of the Trust Shares by parties other than the
Trust, are the legal, valid, binding and enforceable obligations of the
Trust, subject to the effect of bankruptcy, insolvency, moratorium,
fraudulent conveyance, reorganization and similar laws
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<PAGE> 38
relating to creditors' rights generally and to the application of
equitable principles in any proceeding, whether at law or in equity;
(v) the issued shares of capital stock of each of the
Subsidiaries that is a corporation are duly authorized, validly issued,
fully paid and non-assessable, and all of the partnership interests or
membership interests in each Subsidiary that is a partnership or
limited liability company, other than EMM and CMM, as the case may be,
are validly issued and fully paid. Except as described in the
Registration Statement, this Agreement, or the Prospectus, all of such
shares and interests owned by the Trust or another Subsidiary are owned
beneficially by the Trust or such Subsidiary free and clear of any
security interest, mortgage, pledge, lien, encumbrance, equity or
claim;
(vi) except as described in the Prospectus, to the best
knowledge of such counsel, there are no outstanding securities,
partnership interests or obligations of the Trust or any Subsidiary
convertible or exchangeable into or evidencing the right to purchase or
subscribe for any shares of beneficial interest of the Trust or
ownership interest in the Subsidiaries and there are no outstanding or
authorized options, warrants or rights of any character obligating the
Trust or any Subsidiary to issue any shares of its beneficial interest
or any securities convertible or exchangeable into or evidencing the
right to purchase or subscribe for any shares of such beneficial
interest; and except as described in the Prospectus to the best of
knowledge of such counsel, no holder of any securities of the Trust or
any other person has the right, contractual or otherwise, which has not
been satisfied or effectively waived, to cause the Trust to sell or
otherwise issue to them, or to permit them to underwrite the sale of,
any of the Shares or the right to have any securities of the Trust
included in the
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<PAGE> 39
Registration Statement or the right, as a result of the filing of the
Registration Statement, to require registration under the Act of any
securities of the Trust, and no holders of outstanding shares of
beneficial interest of the Trust are entitled as such to any preemptive
or other rights to subscribe for any of the Shares;
(vii) the statements set forth under the headings "Description
of Shares of Beneficial Interest," "Description of Preferred Shares"
and "Description of Warrants" in the Prospectus and the headings
"Description of Series A-1 Preferred Shares" and "Description of Series
B Preferred Shares" in the Prospectus Supplement, insofar as such
statements purport to summarize certain provisions of the securities of
the Trust, provide a fair summary of such provisions; and the
statements set forth under the headings "Restrictions on Ownership of
Offered Securities" and "Certain United States Federal Income Tax
Considerations to the Trust of its REIT Election" in the Prospectus and
"Risk Factors," and "Recent Developments," in the Prospectus
Supplement, insofar as such statements constitute a summary of the
legal matters or legal conclusions, have been reviewed by them and are
correct in all material respects;
(viii) the execution and delivery of this Agreement has been
duly authorized by all necessary trust or partnership action of the
Trust, and the Operating Partnership and this Agreement has been duly
executed and delivered by the Trust and the Operating Partnership, and
are the valid and binding agreements of the Trust and the Operating
Partnership, enforceable against the Trust and the Operating
Partnership in accordance with their respective terms, subject to (a) `
the effect of bankruptcy, insolvency, reorganization, moratorium or
other similar laws now or hereafter in effect relating to or affecting
the rights or remedies
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of creditors or (b) the effect of general principles of equity, whether
enforcement is considered in a proceeding in equity or at law, and the
discretion of the court before which any proceeding therefor may be
brought;
(ix) the authorized capital stock of the Trust conforms as to
legal matters to the description thereof contained in the Prospectus;
(x) the Registration Statement has become effective under the
Act, the Prospectus was filed with the Commission pursuant to Rule 424
within the applicable time period prescribed by Rule 424, no stop order
suspending its effectiveness has been issued and no proceedings for
that purpose are, to the best of such counsel's knowledge after due
inquiry, pending before or contemplated by the Commission;
(xi) neither the Trust nor any of the Subsidiaries is in
violation of its respective declaration of trust, certificate of
incorporation, by-laws, Partnership Agreement or other organizational
documents, as the case may be, and, to the best of such counsel's
knowledge after due inquiry, neither the Trust nor any of the
Subsidiaries is in default in the performance of any obligation,
agreement, covenant or condition contained in any indenture, loan
agreement, mortgage, lease or other agreement or instrument that is
material to the Trust and the Subsidiaries, taken as a whole, to which
the Trust or any of the Subsidiaries is a party or by which the Trust
or any of the Subsidiaries or their respective property is bound;
(xii) the execution, delivery and performance of this
Agreement by the Trust and the Operating Partnership, the compliance by
the Trust and the Operating Partnership, with all the provisions hereof
and the consummation of the transactions contemplated
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hereby will not (A) require any consent, approval, authorization,
registration or other order of, or qualification with, any court or
governmental body or agency (except such as may be required under the
securities or Blue Sky laws of the various states), (B) conflict with
or constitute a breach of any of the terms or provisions of, or a
default under, the declaration of trust, charter or by-laws,
partnership agreement, operating agreement (or the governing documents
or other organizational documents, as the case may be, of the Trust or
any of the Subsidiaries or any indenture, loan agreement, mortgage,
lease or other agreement or instrument that is material to the Trust
and the Subsidiaries, taken as a whole, to which the Trust or any of
the Subsidiaries is a party or by which the Trust or any of the
Subsidiaries or their respective property is bound, (C) violate or
conflict with any applicable law or any rule, regulation, judgment,
order or decree of any court or any governmental body or agency having
jurisdiction over the Trust, any of the Subsidiaries or their
respective property or (D) result in the suspension, termination or
revocation of any Authorization of the Trust or any of the Subsidiaries
or any other impairment of the rights of the holder of any such
Authorization;
(xiii) after due inquiry, such counsel does not know of any
legal or governmental proceedings pending or threatened to which the
Trust or any of the Subsidiaries, or any of their respective trustees,
directors or officers in their capacity as such, is or could be a party
or to which any of their respective property is or could be subject
that are required to be described in the Prospectus and are not so
described, or of any statutes, regulations, contracts or other
documents that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not so described or filed as required;
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(xiv) each of the Trust and the Subsidiaries has such
Authorizations of, and has made all filings with and notices to, all
governmental or regulatory authorities and self-regulatory
organizations and all courts and other tribunals, including, without
limitation, under any applicable Environmental Laws, as are necessary
to own, lease, license and operate its respective properties and to
conduct its business, except where the failure to have any such
Authorization or to make any such filing or notice would not, singly or
in the aggregate, have a material adverse effect on the business,
prospects, financial condition or results of operations of the Trust
and the Subsidiaries, taken as a whole; each such Authorization is
valid and in full force and effect and each of the Trust and the
Subsidiaries is in compliance with all the terms and conditions thereof
and with the rules and regulations of the authorities and governing
bodies having jurisdiction with respect thereto; and no event has
occurred (including, without limitation, the receipt of any notice from
any authority or governing body) which allows or, after notice or lapse
of time or both, would allow, revocation, suspension or termination of
any such Authorization, or results or, after notice or lapse of time or
both, would result in any other impairment of the rights of the holder
of any such Authorization; and such Authorizations contain no
restrictions that are burdensome to the Trust or any of the
Subsidiaries; except where such failure to be valid and in full force
and effect or to be in compliance, the occurrence of any such event or
the presence of any such restriction would not, singly or in the
aggregate, have a material adverse effect on the business, prospects,
financial condition or results of operations of the Trust and the
Subsidiaries, taken as a whole;
(xv) the Trust is not, and, after giving effect to the
offering and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus,
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will not be, an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended;
(xvi) (A) each document, if any, filed pursuant to the
Exchange Act and incorporated by reference in the Prospectus (except
for financial statements and other financial data included therein as
to which no opinion need be expressed) complied when so filed as to
form with the Exchange Act, (B) the Registration Statement and the
Prospectus and any supplement or amendment thereto (except for the
financial statements and other financial data included therein as to
which no opinion need be expressed) comply as to form with the Act, (C)
such counsel has no reason to believe that, at the time the
Registration Statement became effective or on the date of this
Agreement, the Registration Statement and the prospectus included
therein (except for the financial statements and other financial data
as to which such counsel need not express any belief) contained any
untrue statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading, (D) such counsel has no reason to believe that
the Prospectus, as amended or supplemented, if applicable (except for
the financial statements and other financial data, as aforesaid)
contains any untrue statement of a material fact or omits to state a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading,
and (E) to the best of counsel's knowledge after due inquiry, no stop
order suspending the effectiveness of the Registration Statement or any
post-effective amendment thereto and no order directed at any document
incorporated by reference in the Registration Statement, the
Prospectus, or any amendment or supplement thereto has been issued,
and, to the best of counsel's knowledge after due inquiry, no
proceedings for that purpose have
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been instituted or, to the best knowledge of such counsel, threatened
by the Commission;
(xvii) (A) the Trust was organized in conformity with the
requirements for qualification as a REIT for federal income tax
purposes, and, based on the facts and assumptions set forth in the
Basic Prospectus, the Preliminary Prospectus and the Prospectus
Supplement and certain representations by the Trust, including but not
limited to those set forth in the Officer's Certificate regarding
certain federal income tax matters, its method of operation has enabled
it, and its proposed method of operation will enable it, to meet the
requirements under the Internal Revenue Code for qualification and
taxation as a REIT and (B) the Operating Partnership, the other
Partnership Subsidiaries and the LLC Subsidiaries will be treated for
federal income tax purposes as partnerships and not as associations
taxable as corporations or as publicly traded partnerships;
(xviii) the Trust satisfies all conditions and requirements
for filing the Registration Statement on Form S-3 under the Act; and
(xix) the Shares have been approved for listing on the NYSE,
subject to official notice of issuance.
The foregoing opinions shall be rendered to you at the request of the
Trust and shall so state therein.
In giving such opinions with respect to the matters covered by Section
8(f)(xvi), counsel for the Trust may state that their opinion and belief are
based upon their participation in the preparation of the Registration Statement
and Prospectus and any amendments or supplements thereto and documents
incorporated therein by reference and review and discussion of the contents
thereof, but is
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without independent check or verification except as specified.
(g) You shall have received on the Closing Date an opinion, dated the
Closing Date, of Weil, Gotshal & Manges LLP, counsel for the Underwriters, with
respect to the Prospectus and such other related matters as the Underwriters may
reasonably require, and the Trust shall have furnished to such counsel such
documents as they may reasonably request for the purpose of enabling them to
pass upon such matters.
(h) You shall have received, on each of the date hereof and the Closing
Date, a letter dated the date hereof or the Closing Date, as the case may be, in
form and substance satisfactory to you, from Coopers & Lybrand L.L.P.,
independent public accountants, containing the information and statements of the
type ordinarily included in accountants' "comfort letters" to Underwriters with
respect to the financial statements and certain financial information contained
in or incorporated by reference into the Registration Statement and the
Prospectus.
(i) The Shares shall have been duly listed, subject to notice of
issuance, on the NYSE.
(j) The Trust shall not have failed on or prior to the Closing Date to
perform or comply with any of the agreements herein contained and required to be
performed or complied with by the Trust on or prior to the Closing Date.
(k) On or before the Closing Date, the Underwriters and counsel for the
Underwriters shall have received such further certificates, documents or other
information as they may have reasonably requested from the Trust.
(l) Contemporaneously with the closing hereunder, all of the issued and
outstanding shares of Series A Convertible Preferred Shares of Beneficial
Interest, par value $.01 per
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share, of the Trust (the "SERIES A PREFERRED SHARES") will be exchanged for
Series A-1 Convertible Preferred Shares of Beneficial Interest, par value $.01
per share, of the Trust in accordance with Amendment No. 1 ("AMENDMENT NO. 1"),
dated as of November 6, 1997, to the Securities Purchase Agreement (the
"SECURITIES PURCHASE AGREEMENT"), dated as of November 6, 1996, among PAT II,
the Trust and the Operating Partnership. In addition, contemporaneously with the
closing hereunder, all authorized shares of Series A Preferred Shares shall be
cancelled. Neither Amendment No. 1 or the Securities Purchase Agreement shall
have been amended without the prior written consent of the Representatives,
which consent shall not be unreasonably withheld.
The several obligations of the Underwriters to purchase any Additional
Shares hereunder are subject to the delivery to you on the applicable Option
Closing Date of such documents as you may reasonably request with respect to the
good standing of the Trust, the due authorization and issuance of such
Additional Shares and other matters related to the issuance of such Additional
Shares.
SECTION 9. Effectiveness of Agreement and Termination. This Agreement
shall become effective upon the execution of this Agreement by the parties
hereto.
This Agreement may be terminated at any time on or prior to the Closing
Date by you by written notice to the Trust if any of the following has occurred:
(i) since the respective dates as of which information is given in the
Registration Statement and the Prospectus, there has been any adverse effect or
development involving a prospective material adverse effect in the condition,
financial or otherwise, of the Trust or any of the Subsidiaries or the
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earnings, affairs or business prospects of the Trust or any of the Subsidiaries,
whether or not arising in the ordinary course of business, which would, in your
judgment, make it impracticable to market the Shares on the terms and in the
manner contemplated in the Prospectus, (ii) any outbreak or escalation of
hostilities or other national or international calamity or crisis or change in
economic conditions or in the financial markets of the United States or
elsewhere that, in your judgment, is material and adverse and, in your judgment,
makes it impracticable to market the Shares on the terms and in the manner
contemplated in the Prospectus, (iii) the suspension or material limitation of
trading in securities or other instruments on the New York Stock Exchange, the
American Stock Exchange, the Chicago Board of Options Exchange, the Chicago
Mercantile Exchange, the Chicago Board of Trade or the Nasdaq National Market or
limitation on prices for securities or other instruments on any such exchange or
the Nasdaq National Market, (iv) the suspension of trading of any securities of
the Trust on any exchange or in the over-the-counter market, (v) the enactment,
publication, decree or other promulgation of any federal or state statute,
regulation, rule or order of any court or other governmental authority which in
your opinion materially and adversely affects, or will materially and adversely
affect, the business, prospects, financial condition or results of operations of
the Trust and the Subsidiaries, taken as a whole, (vi) the declaration of a
banking moratorium by either federal or New York State authorities or (vii) the
taking of any action by any federal, state or local government or agency in
respect of its monetary or fiscal affairs which in your opinion has a material
adverse effect on the financial markets in the United States.
If on the Closing Date or on an Option Closing Date, as the case may
be, any one or more of the Underwriters shall fail or refuse to purchase the
Trust Shares or Additional
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Shares, as the case may be, which it has or they have agreed to purchase
hereunder on such date and the aggregate number of Trust Shares or Additional
Shares, as the case may be, which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-tenth of the total
number of Trust Shares or Additional Shares, as the case may be, to be purchased
on such date by all Underwriters, each non-defaulting Underwriter shall be
obligated severally, in the proportion which the number of Trust Shares set
forth opposite its name in Schedule I bears to the total number of Trust Shares
which all the non-defaulting Underwriters have agreed to purchase, or in such
other proportion as you may specify, to purchase the Trust Shares or Additional
Shares, as the case may be, which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase on such date; provided that in no event
shall the number of Trust Shares or Additional Shares, as the case may be, which
any Underwriter has agreed to purchase pursuant to Section 2 hereof be increased
pursuant to this Section 9 by an amount in excess of one-ninth of such number of
Trust Shares or Additional Shares, as the case may be, without the written
consent of such Underwriter. If on the Closing Date any Underwriter or
Underwriters shall fail or refuse to purchase Trust Shares and the aggregate
number of Trust Shares with respect to which such default occurs is more than
one-tenth of the aggregate number of Trust Shares to be purchased by all
Underwriters and arrangements satisfactory to you and the Trust for purchase of
such Trust Shares are not made within 48 hours after such default, this
Agreement will terminate without liability on the part of any non-defaulting
Underwriter and the Trust. In any such case which does not result in termination
of this Agreement, either you or the Trust shall have the right to postpone the
Closing Date, but in no event for longer than seven days, in the event that
required changes in the Registration Statement and the Prospectus or any other
documents or arrangements need to be effected. If, on an Option Closing Date,
any Underwriter or Underwriters shall fail or refuse to purchase Additional
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Shares and the aggregate number of Additional Shares with respect to
which such default occurs is more than one-tenth of the aggregate number of
Additional Shares to be purchased on such date, the non-defaulting Underwriters
shall have the option to (i) terminate their obligation hereunder to purchase
such Additional Shares or (ii) purchase not less than the number of Additional
Shares that such non-defaulting Underwriters would have been obligated to
purchase on such date in the absence of such default. Any action taken under
this paragraph shall not relieve any defaulting Underwriter from liability in
respect of any default of any such Underwriter under this Agreement.
SECTION 10. Miscellaneous. Notices given pursuant to any provision of
this Agreement shall be addressed as follows: (i) if to the Trust, to Glimcher
Realty Trust, 20 South Third Street, Columbus, Ohio 43215, Attention: David J.
Glimcher, and (ii) if to any Underwriter or to you, to you c/o Donaldson, Lufkin
& Jenrette Securities Corporation, 277 Park Avenue, New York, New York 10172,
Attention: Syndicate Department, or in any case to such other address as the
person to be notified may have requested in writing.
The respective indemnities, contribution agreements, representations,
warranties and other statements of the Trust and the several Underwriters set
forth in or made pursuant to this Agreement shall remain operative and in full
force and effect, and will survive delivery of and payment for the Shares,
regardless of (i) any investigation, or statement as to the results thereof,
made by or on behalf of any Underwriter, the officers or directors of any
Underwriter, any person controlling any Underwriter, the Trust, the officers or
directors of the Trust or any person controlling the Trust, (ii) acceptance of
the Shares and
49
<PAGE> 50
payment for them hereunder and (iii) termination of this Agreement.
If for any reason the Shares are not delivered by or on behalf of the
Trust as provided herein (other than as a result of any termination of this
Agreement pursuant to Section 9) in breach of this Agreement, the Trust agrees
to reimburse the several Underwriters for all out-of-pocket expenses (including
the fees and disbursements of counsel) incurred by them. Notwithstanding any
termination of this Agreement, the Trust shall be liable for all expenses which
it has agreed to pay pursuant to Section 5(k) hereof. The Trust also agrees to
reimburse the several Underwriters, their directors and officers and any persons
controlling any of the Underwriters for any and all fees and expenses
(including, without limitation, the fees and disbursements of counsel) incurred
by them in connection with enforcing their rights hereunder (including, without
limitation, pursuant to Section 7 hereof).
Except as otherwise provided, this Agreement has been and is made
solely for the benefit of and shall be binding upon the Trust, the Operating
Partnership, the Underwriters, the Underwriters' directors and officers, any
controlling persons referred to herein, the Trust's directors and the Trust's
officers who sign the Registration Statement and their respective successors and
assigns, all as and to the extent provided in this Agreement, and no other
person shall acquire or have any right under or by virtue of this Agreement. The
term "successors and assigns" shall not include a purchaser of any of the Shares
from any of the several Underwriter merely because of such purchase.
50
<PAGE> 51
This Agreement shall be governed and construed in accordance with the
laws of the State of New York.
This Agreement may be signed in various counterparts which together
shall constitute one and the same instrument.
Please confirm that the foregoing correctly sets forth the agreement
between the Trust, the Operating Partnership and the several Underwriters.
Very truly yours,
GLIMCHER REALTY TRUST
/s/ David Glimcher
By:_________________________________________
Title: President
GLIMCHER PROPERTIES LIMITED PARTNERSHIP
By: Glimcher Properties Corporation
/s/ David Glimcher
By:_________________________________________
Title: President
DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
Prudential Securities Corporation
BT Alex. Brown Incorporated
51
<PAGE> 52
PaineWebber Incorporated
Acting severally on behalf of
themselves and the several
Underwriters named in
Schedule I hereto
By: DONALDSON, LUFKIN & JENRETTE
SECURITIES CORPORATION
/s/ Eric A. Anderson
By:_____________________________
Managing Director
52
<PAGE> 53
SCHEDULE I
<TABLE>
<CAPTION>
Underwriter Number of Trust
- ----------- Shares
to be Purchased
---------------
<S> <C>
Donaldson, Lufkin & Jenrette
Securities Corporation 1,038,000
Prudential Securities Incorporation 1,038,000
BT Alex. Brown Incorporated 1,037,000
PaineWebber Incorporated 1,037,000
CIBC Oppenheimer Corp. 50,000
A.G. Edwards & Sons, Inc. 50,000
J.J.B. Hilliard, W.L. Lyons Inc. 50,000
SBC Warburg Dillon Read Inc. 50,000
Cowen & Company 25,000
Dain Bosworth Incorporated 25,000
EVEREN Securities, Inc. 25,000
Fahnestock & Co. Inc. 25,000
First Albany Corporation 25,000
Gruntal & Co., L.L.C. 25,000
Janney Montgomery Scott Inc. 25,000
McDonald & Company Securities, Inc. 25,000
McGinn, Smith & Co., Inc. 25,000
Morgan Keegan & Company, Inc. 25,000
The Ohio Company 25,000
Piper Jaffray Inc. 25,000
Rauscher Pierce Refsnes, Inc. 25,000
Raymond James & Associates, Inc. 25,000
The Robinson-Humphrey Company, Inc. 25,000
Stephens Inc. 25,000
Sutro & Co. Incorporated 25,000
Tucker Anthony Incorporated 25,000
---------
Total 4,800,000
=========
</TABLE>
<PAGE> 1
EXHIBIT 4.2
ARTICLES SUPPLEMENTARY
CLASSIFYING
5,520,000 SHARES OF
BENEFICIAL INTEREST AS
SERIES B CUMULATIVE REDEEMABLE
PREFERRED SHARES OF BENEFICIAL INTEREST
OF GLIMCHER REALTY TRUST
(Pursuant to Section 8-203(b) of the
Corporations and Associations Article
of the Annotated Code of Maryland)
Glimcher Realty Trust, a real estate investment trust organized and
existing under the laws of the State of Maryland (the "Company"), and having its
executive office at 20 South Third Street, Columbus, Ohio 43215, hereby
certifies to the State Department of Assessments and Taxation of Maryland that:
FIRST: Pursuant to the authority granted to and vested in the Board
of Trustees of the Company (the "Board of Trustees") under Article VI, Section
6.3 of the Amended and Restated Declaration of Trust of the Company, as amended
(the "Declaration of Trust"), the Board of Trustees at a meeting duly convened
and held on November 5, 1997, adopted resolutions authorizing and establishing a
separate class of preferred shares of beneficial interest, out of the
100,000,000 authorized shares of beneficial interest of the Company (the
"Shares"), consisting of 5,520,000 shares to be known as the "Series B
Cumulative Redeemable Preferred Shares of Beneficial Interest" (the "Series B
Preferred Shares"). Such Series B Preferred Shares shall have a par value of
$.01 per share. The preferences and other rights, voting powers, restrictions,
limitations as to distributions, qualifications, and terms and conditions of
redemption of such shares, which shall be deemed to be part of Article VI,
Section 6.3 of the Declaration of Trust, are as follows:
A. Certain Definitions.
Unless the context otherwise requires, the terms defined in this paragraph
(A) shall have, for all purposes of the provisions of the Declaration of Trust
in respect of the Series B Preferred Shares, the meanings herein specified (with
terms defined in the singular having comparable meanings when used in the
plural).
Business Day. The term "Business Day" shall mean any day, other than a
Saturday or Sunday, that is neither a legal holiday nor a day on which banking
institutions in New York City are
<PAGE> 2
authorized or required by law, regulation or executive order to close.
Capital Shares. The term "Capital Shares" shall mean, with respect to any
Person, any common shares of beneficial interest, preferred shares, depositary
shares, interests, particiption or other ownership interests (however
designated) of such Person and any rights (other than debt securities
convertible into or exchangeable for capital shares), warrants or options to
purchase any thereof.
Code. The term "Code" shall mean the Internal Revenue Code of 1986, as
amended from time to time.
Common Equity. The term "Common Equity" shall mean all shares now or
hereafter authorized of any class of common shares of beneficial interest of the
Company, including the Common Shares, and any other shares of beneficial
interest of the Company, howsoever designated, which has the right (subject
always to prior rights of any class or series of preferred shares of beneficial
interest) to participate in the distribution of the assets and earnings of the
Company without limit as to per share amount.
Common Shares. The term "Common Shares" shall mean the
Common Shares of Beneficial Interest, $.01 par value per share,
of the Company.
Distribution Payment Date. The term "Distribution Payment
Date" shall have the meaning set forth in subparagraph (2) of
paragraph (B) below.
Distribution Period. The term "Distribution Period" shall mean the period
from, and including, the Initial Issue Date to, but not including, the first
Distribution Payment Date and thereafter, each quarterly period from, and
including, the Distribution Payment Date to, but not including, the next
Distribution Payment Date.
Distribution Record Date. The term "Distribution Record Date" shall mean
the date designated by the Board of Trustees of the Company at the time a
distribution is declared, provided, however, that such Distribution Record Date
shall be not more than sixty (60) days nor less than ten (10) days prior to such
Distribution Payment Date.
Junior Shares. The term "Junior Shares" shall mean, as the case may be,
(i) the Common Equity and any other class or series of shares of beneficial
interest of the Company which is not entitled to receive any distributions in
any Distribution Period unless all distributions required to have been paid or
declared and set apart for payment on the Series B Preferred Shares shall
-2-
<PAGE> 3
have been so paid or declared and set apart for payment and (ii) the Common
Equity and any other class or series of shares of beneficial interest of the
Company which is not entitled to receive any assets upon liquidation,
dissolution or winding up of the affairs of the Company until the Series B
Preferred Shares shall have received the entire amount to which such Class B
Preferred Shares is entitled upon such liquidation, dissolution or winding up.
The term "Junior Shares" shall include the Nomura Preferred Shares.
Liquidation Preference. The term "Liquidation Preference" shall mean
$25.00 per share.
Nomura Preferred Shares. The term "Nomura Preferred Shares" shall mean the
Series A Preferred Shares and the Series A-1 Preferred Shares collectively with
any other series of preferred shares of beneficial interest of the Company
issued from time to time pursuant to the Securities Purchase Agreement. Nomura
Preferred Shares shall not include any other preferred shares of beneficial
interest issued to Nomura or any other Person on any terms, whether or not
substantially similar to the terms of the Series A Preferred Shares, for any
reason, whether or not such preferred shares of beneficial interest are issued
in connection with the properties contemplated under the Securities Purchase
Agreement.
Original Issue Date. The term "Original Issue Date" shall mean the date
that Series B Preferred Shares are first issued by the Company.
Parity Shares. The term "Parity Shares" shall mean, as the case may be,
(i) any class or series of shares of beneficial interest of the Company which is
entitled to receive payment of distributions on a parity with the Series B
Preferred Shares or (ii) any class or series of shares of beneficial interest of
the Company which is entitled to receive assets upon liquidation, dissolution or
winding up of the affairs of the Company on a parity with the Series B Preferred
Shares.
Person. The term "Person" shall mean an individual, corporation,
partnership, estate, trust (including a trust classified under Section 401(a) or
501(c)(17) of the Code), a portion of a trust permanently set aside for or to be
used exclusively for the purposes described in Section 642(c) of the Code,
association, private foundation within the meaning of Section 509(a) of the
Code, joint stock company or other entity, and also includes a group as that
term is used for purposes of Section 13(d)(3) of the Securities Exchange Act of
1934, as amended, but does not include an underwriter which participates in a
public offering of the Series B Preferred Shares, provided that such ownership
by such underwriter would not result in the Company being "closely held" within
the meaning of Section 856(h)
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<PAGE> 4
of the Code, or otherwise result in the Company failing to qualify as a REIT.
Preferential Distribution Non-Payment. The term "Preferential Distribution
Non-Payment" shall have the meaning set forth in subparagraph (2) of paragraph
(E) below.
Preferred Shares Trustee. The term "Preferred Shares Trustee" shall have
the meaning set forth in subparagraph (2) of paragraph (E) below.
Redemption Date. The term "Redemption Date" shall have the meaning set
forth in subparagraph (2) of paragraph (D) below.
Redemption Price. The term "Redemption Price" shall mean a price per
Series B Preferred Share equal to $25.00 together with accrued and unpaid
distributions, if any, thereon to the Redemption Date, without interest.
Redemption Record Date. The term "Redemption Record Date" shall mean the
date designated by the Board of Trustees of the Company for redemption of Series
B Preferred Shares, provided, however, that such Redemption Record Date shall be
not more than sixty (60) days nor less than thirty (30) days prior to such
Redemption Date.
REIT. The term "REIT" shall mean a real estate investment trust under
Section 856 of the Code.
Securities Purchase Agreement. The term "Securities Purchase Agreement"
shall mean that certain Securities Purchase Agreement among Partnership
Acquisition Trust II ("Nomura"), Glimcher Properties Limited Partnership (the
"Operating Partnership") and the Company, dated as of November 26, 1996, as
amended from time to time.
Senior Shares. The term "Senior Shares" shall mean, as the case may be,
(i) any class or series of shares of beneficial interest of the Company ranking
senior to the Series B Preferred Shares in respect of the right to receive
distributions or (ii) any class or series of shares of beneficial interest of
the Company ranking senior to the Series B Preferred Shares in respect of the
right to participate in any distribution upon liquidation, dissolution or
winding up of the affairs of the Company.
Series A Preferred Shares. The term "Series A Preferred Shares" shall mean
the Series A Convertible Preferred Shares of Beneficial Interest, par value $.01
per share, of the Company, issued pursuant to the Securities Purchase Agreement.
-4-
<PAGE> 5
Series A-1 Articles Supplementary. The term "Series A-1 Articles
Supplementary" shall mean the Articles Supplementary clarifying and designating
40,000 shares of Series A-1 Convertible Preferred Shares of Beneficial Interest.
Series A-1 Preferred Shares. The term "Series A-1 Preferred Shares" shall
mean the Series A-1 Convertible Preferred Shares of Beneficial Interest, par
value $.01 per share, of the Company, issued pursuant to the Securities Purchase
Agreement.
B. Distributions.
1. The record holders of Series B Preferred Shares shall be entitled to
receive cash distributions, when, as and if authorized and declared by the Board
of Trustees, out of assets legally available for payment of distributions. Such
distributions shall be payable quarterly by the Company in cash at a rate of
9-1/4% of the Liquidation Preference per annum (equivalent to $2.3125 per
Series B Preferred Share per annum).
2. Distributions on Series B Preferred Shares shall accrue and be
cumulative from the Original Issue Date. Distributions shall be payable
quarterly in arrears when, as and if authorized by the Board of Trustees of the
Company on the 15th day of January, April, July and October of each year (each,
a "Distribution Payment Date"), commencing on the Business Day succeeding
January 15, 1998. If any Distribution Payment Date occurs on a day that is not a
Business Day, any accrued distributions otherwise payable on such Distribution
Payment Date shall be paid on the next succeeding Business Day. The amount of
distributions payable on Series B Preferred Shares for each full Distribution
Period shall be computed by dividing by four (4) the annual distribution rate
set forth in subparagraph (1) of this paragraph (B) above. Distributions payable
in respect of any Distribution Period which is less than a full Distribution
Period in length will be computed on the basis of a 360-day year consisting of
twelve 30-day months. Distributions shall be paid to the holders of record of
the Series B Preferred Shares as their names shall appear on the share records
of the Company at the close of business on the Distribution Record Date for such
distribution. Distributions in respect of any past Distribution Periods that are
in arrears may be declared and paid at any time to holders of record on the
Distribution Record Date therefor. Any distribution payment made on Series B
Preferred Shares shall be first credited against the earliest accrued but unpaid
distribution due which remains payable. The Series B Preferred Shares rank
senior to the Nomura Preferred Shares, as to distributions in the manner and to
the extent provided herein.
3. If any Series B Preferred Shares are outstanding, no distributions
shall be authorized or paid or set apart for payment on any other class or
series of Junior Shares or Parity
-5-
<PAGE> 6
Shares for any period unless full cumulative distributions have been or
contemporaneously are authorized and paid or authorized and a sum sufficient for
the payment thereof set apart for such payment on the Series B Preferred Shares
for all past Distribution Periods and the then current Distribution Period. When
distributions are not paid in full (or a sum sufficient for such full payment is
not so set apart) upon the Series B Preferred Shares and any other class or
series of Preferred Shares ranking on a parity as to distributions with the
Series B Preferred Shares, all distributions authorized upon the Series B
Preferred Shares and any other such class or series of Preferred Shares shall be
authorized pro rata so that the amount of distributions authorized per share on
the Series B Preferred Shares and such class or series of Shares shall in all
cases bear to each other the same ratio that accrued and unpaid distributions
per share on the Series B Preferred Shares and such class or series of Shares
bear to each other. No interest, or sum of money in lieu of interest, shall be
payable in respect of any distribution payment or payments on the Series B
Preferred Shares which may be in arrears. The provisions of this subparagraph
(3) shall not prohibit the mandatory redemption referred to in subparagraph (4)
of this paragraph (B).
4. Except as provided in subparagraph (3) of this paragraph (B), unless
full cumulative distributions on the Series B Preferred Shares have been or
contemporaneously are authorized and paid or authorized and a sum sufficient for
the payment thereof set apart for payment for all past Distribution Periods and
the then current Distribution Period, no distributions (other than in Junior
Shares) shall be authorized or paid or set apart for payment or other
distribution shall be authorized or made upon any Junior Shares or Parity Shares
nor shall any Junior Shares or Parity Shares be redeemed, purchased or otherwise
acquired for any consideration (or any moneys be paid to or made available for a
sinking fund for the redemption of any such shares) by the Company (except by
conversion into or exchange for other Junior Shares); provided, however, that
the foregoing shall not prevent (i) the mandatory redemption by the Company of
Series A-1 Preferred Shares in accordance with the terms set forth in the Series
A-1 Articles Supplementary as in existence on the Original Issue Date, and (ii)
the mandatory redemption by the Company of any other series of Nomura Preferred
Shares issued from time to time pursuant to the Securities Purchase Agreement in
accordance with the terms set forth in the articles supplementary classifying
such series of Nomura Preferred Shares, which terms shall be substantially
similar to the mandatory redemption terms set forth in the Series A-1 Articles
Supplementary as in existence on the Original Issue Date, except that such
articles supplementary shall relate to a different property to be acquired,
constructed and/or developed by a separate entity in which the Company is either
directly or indirectly a co-participant.
-6-
<PAGE> 7
5. Notwithstanding anything contained herein to the contrary, no
distributions on Series B Preferred Shares shall be authorized by the Board of
Trustees of the Company or paid or set apart for payment by the Company at such
time as the terms and provisions of any agreement of the Company, including any
agreement relating to its indebtedness, prohibits such authorization, payment or
setting apart for payment or provides that such authorization, payment or
setting apart for payment would constitute a breach thereof or a default
thereunder, or to the extent such authorization, payment or setting apart for
payment shall be restricted or prohibited by law.
6. Notwithstanding anything contained herein to the contrary,
distributions on the Series B Preferred Shares, if not paid on the applicable
Distribution Payment Date, will accrue whether or not any agreement of the
Company prohibits payment of such distributions, whether or not distributions
are authorized for such Distribution Payment Date, whether or not the Company
has earnings and whether or not there are assets legally available for the
payment of such distributions.
7. If the Board of Trustees determines that it is permissible under
applicable law and that the distributions will qualify for the dividends paid
deduction (within the meaning of Sections 561 and 562 of the Code or any
successor provisions thereto), such distributions shall be paid as follows:
first, from income of the Company other than net capital gains, and the balance,
if any, from net capital gains of the Company. If the Board of Trustees
determines, in its sole discretion, that distributions to be paid in accordance
with the preceding sentence might not qualify for such dividends paid deduction,
or might not be permissible under applicable law, then such distributions shall
be paid in a manner determined by the Board of Trustees.
C. Distributions Upon Liquidation, Dissolution or Winding Up.
1. Upon any voluntary or involuntary liquidation, dissolution or winding
up of the affairs of the Company, subject to the prior preferences and other
rights of any Senior Shares as to liquidation preferences, but before any
distribution or payment shall be made to the holders of any Junior Shares as to
the distribution of assets upon any liquidation, dissolution or winding up of
the affairs of the Company, the holders of Series B Preferred Shares shall be
entitled to receive out of the assets of the Company legally available for
distribution to its shareholders liquidating distributions in cash or property
at its fair market value as determined by the Board of Trustees in the amount of
the Liquidation Preference per share plus an amount equal to all distributions
accrued and unpaid thereon (whether or not declared) to the date of such
liquidation, dissolution or winding up. After payment of the full amount of the
liquidating
-7-
<PAGE> 8
distributions to which they are entitled, the holders of Series B Preferred
Shares will have no right or claim to any of the remaining assets of the Company
and shall not be entitled to any other distribution in the event of liquidation,
dissolution or winding up of the affairs of the Company.
2. In the event that, upon any such voluntary or involuntary liquidation,
dissolution or winding up, the legally available assets of the Company are
insufficient to pay the amount of the Liquidation Preference per share plus an
amount equal to all distributions accrued and unpaid on the Series B Preferred
Shares and the corresponding amounts payable on all shares of Parity Shares as
to the distribution of assets upon liquidation, dissolution or winding up, then
the holders of the Series B Preferred Shares and all such Parity Shares shall
share ratably in any such distribution of assets in proportion to the full
liquidating distributions to which they otherwise would be respectively
entitled. The Series B Preferred Shares rank senior to the Nomura Preferred
Shares as to the distribution of assets upon any liquidation, dissolution or
winding up of the affairs of the Company. Neither the consolidation or merger of
the Company into or with another entity nor the dissolution, liquidation,
winding up or reorganization of the Company immediately followed by
incorporation of another corporation to which such assets are distributed, nor
the sale, lease, transfer or conveyance of all or substantially all of the
assets of the Company to another entity shall be deemed a liquidation,
dissolution or winding up of the affairs of the Company within the meaning of
this paragraph (C); provided that, in each case, effective provision is made in
the charter of the resulting or surviving entity or otherwise for the
recognition, preservation and protection of the rights of the holders of the
Series B Preferred Shares.
3. In determining whether a distribution by dividend, redemption or other
acquisition of Shares or otherwise is permitted under Maryland law, no effect
shall be given to amounts that would be needed, if the Company were to be
dissolved at the time of the distribution, to satisfy the preferential rights
upon dissolution of shareholders whose preferential rights on dissolution are
superior to those receiving the distribution.
D. Redemption by the Company.
1. The Series B Preferred Shares may be redeemed for cash, in whole or
from time to time in part, on any date on or after November 15, 2002 as fixed by
the Board of Trustees of the Company at the Redemption Price. The Redemption
Price of the Series B Preferred Shares (other than any portion thereof
consisting of accrued and unpaid dividends) shall be paid solely from the sale
proceeds of other Capital Shares of the Company or the Operating Partnership and
not from any other source.
-8-
<PAGE> 9
2. Each date fixed for redemption pursuant to subparagraph (1) of this
paragraph (D) is called a "Redemption Date". If the Redemption Date is after a
Distribution Record Date and before the related Distribution Payment Date, the
distribution payable on such Distribution Payment Date shall be paid to the
holder in whose name the Series B Preferred Shares to be redeemed are registered
at the close of business on such Distribution Record Date notwithstanding the
redemption thereof between such Distribution Record Date and the related
Distribution Payment Date or the Company's default in the payment of the
distribution.
3. In case of redemption of less than all of the Series B Preferred Shares
at the time outstanding, the shares to be redeemed shall be selected by the
Company pro rata from the holders of record of such shares in proportion to the
number of shares held by such holders (with adjustments to avoid redemption of
fractional shares) or by any other equitable method determined by the Board of
Trustees.
In order to facilitate the redemption of Series B Preferred Shares, the
Board of Trustees may fix a record date for the determination of the shares to
be redeemed, such record date to be not less than thirty (30) nor more than
sixty (60) days prior to the date fixed for such redemption.
4. Notice of any redemption will be given by publication in a newspaper of
general circulation in The City of New York, such publication to be made once a
week for two successive weeks commencing not less than 30 nor more than 60 days
prior to the Redemption Date. A similar notice will be mailed by the Company,
postage prepaid, not less than 30 nor more than 60 days prior to the Redemption
Date, addressed to the respective holders of record of the Series B Preferred
Shares to be redeemed at their respective addressees as they appear on the share
transfer records of the Company. No failure to give such notice or any defect
therein or in the mailing thereof shall affect the validity of the proceedings
for the redemption of any Series B Preferred Shares except as to any holder to
whom the Company has failed to give notice or except as to any holder to whom
notice was defective. In addition to any information required by law or by the
applicable rules of any exchange upon which Series B Preferred Shares may be
listed or admitted to trading, such notice shall state: (i) the Redemption Date;
(ii) the Redemption Price; (iii) the number of Series B Preferred Shares to be
redeemed and, if less than all shares held by the particular holder are to be
redeemed, the number of Series B Preferred Shares to be redeemed from such
holder; (iv) the place or places where certificates for such shares are to be
surrendered for payment of the Redemption Price; and (v) that distributions on
the shares to be redeemed will cease to accrue on the Redemption Date.
-9-
<PAGE> 10
5. If notice has been mailed in accordance with subparagraph (4) of this
paragraph (D), and such notice provided that on or before the Redemption Date
specified therein all funds necessary for such redemption shall have been set
aside by the Company, separate and apart from its other funds in trust for the
pro rata benefit of the holders of the shares so called for redemption, so as to
be, and to continue to be available therefor, then, from and after the
Redemption Date, distributions on the Series B Preferred Shares so called for
redemption shall cease to accrue, and said shares shall no longer be deemed to
be outstanding and shall not have the status of Series B Preferred Shares, and
all rights of the holders thereof as shareholders of the Company (except the
right to receive from the Company the Redemption Price) shall cease. Upon
surrender, in accordance with said notice, of the certificates for any shares so
redeemed (properly endorsed or assigned for transfer, if the Company shall so
require and the notice shall so state), such shares shall be redeemed by the
Company at the Redemption Price. In case fewer than all the shares represented
by any such certificate are redeemed, a new certificate or certificates shall be
issued representing the unredeemed shares without cost to the holder thereof.
6. Any funds deposited with a bank or trust company for the purpose of
redeeming Series B Preferred Shares shall be irrevocable except that:
a. the Company shall be entitled to receive from such bank or trust
company the interest or other earnings, if any, earned on any money so deposited
in trust, and the holders of any shares redeemed shall have no claim to such
interest or other earnings; and
b. any balance of monies so deposited by the Company and unclaimed
by the holders of the Series B Preferred Shares entitled thereto at the
expiration of two (2) years from the applicable Redemption Date shall be repaid,
together with any interest or other earnings earned thereon, to the Company, and
after any such repayment, the holders of the shares entitled to the funds so
repaid to the Company shall look only to the Company for payment without
interest or other earnings.
7. No Series B Preferred Shares may be redeemed except with assets legally
available for the payment of the Redemption Price.
8. Unless full cumulative distributions on all Series B Preferred Shares
shall have been or contemporaneously are authorized and paid or authorized and a
sum sufficient for the payment thereof set apart for payment for all past
Distribution Periods and the then current Distribution Period, no Series B
Preferred Shares shall be redeemed unless all outstanding Series
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<PAGE> 11
B Preferred Shares are simultaneously redeemed; provided, however, that the
foregoing shall not prevent the purchase or acquisition of Series B Preferred
Shares pursuant to a purchase or exchange offer made on the same terms to
holders of all outstanding Series B Preferred Shares, provided further, however,
that the foregoing shall not prevent the purchase or acquisition of Series B
Preferred Shares from persons owning in the aggregate 8.0% or more of the lesser
of the number or value of the total outstanding shares of beneficial interest of
the Company or 9.9% or more of the lesser of the number or value of the total
outstanding Series B Preferred Shares pursuant to provisions of the Declaration
of Trust and these Articles Supplementary. Unless full cumulative distributions
on all outstanding Series B Preferred Shares have been or contemporaneously are
authorized and paid or authorized and a sum sufficient for the payment thereof
set apart for payment for all past Distribution Periods and the then current
Distribution Period, the Company shall not purchase or otherwise acquire
directly or indirectly any Series B Preferred Shares (except by conversion into
or exchange for shares of the Company ranking junior to the Series B Preferred
Shares as to distributions and upon liquidation, dissolution or winding up of
the affairs of the Company).
9. All Series B Preferred Shares redeemed pursuant to this paragraph (D)
shall be retired and shall be reclassified as authorized and unissued preferred
shares, without designation as to class or series, and may thereafter be
reissued as any class or series of preferred shares.
E. Voting Rights.
1. The holders of Series B Preferred Shares shall not be entitled to vote
on any matter except (i) as provided in paragraph (H), (ii) as provided in
subparagraph (2) of this paragraph (E) or (iii) as expressly provided by law.
2. In the event the Company shall have failed to authorize and pay or set
apart for payment in full the distributions accumulated on the outstanding
Series B Preferred Shares for any six or more quarterly Distribution Periods,
regardless of whether such quarterly periods are consecutive (a "Preferential
Distribution Non-Payment"), the number of trustees of the Company shall be
increased by two and the holders of the outstanding Series B Preferred Shares,
voting together as a class with all other classes or series of preferred shares
of the Company ranking on a parity with the Series B Preferred Shares with
respect to distribution rights and then entitled to vote on the election of such
additional two trustees, shall be entitled to elect such two additional trustees
until the full distributions accumulated for the past distribution periods and
the then current distribution period on all outstanding Series B Preferred
Shares have been authorized and paid or set apart for payment.
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<PAGE> 12
Upon the occurrence of a Preferential Distribution Non-Payment or a vacancy in
the office of a Preferred Shares Trustee, the Board of Trustees may, and upon
the written request of the holders of record of not less than 20% of the holders
of the Series B Preferred Shares and all holders of other classes or series of
preferred shares of the Company ranking on a parity with the Series B Preferred
Shares with respect to distribution rights who are then entitled to vote on the
election of such additional trustee or trustees shall call a special meeting of
such holders for the purpose of electing the additional trustee or trustees. In
the case of such a written request, such special meeting shall be held within
ninety (90) days after the delivery of such request and, in either case, at the
place and upon the notice provided by law and in the Bylaws of the Company,
provided that the Company shall not be required to call such a special meeting
if such request is received less than ninety (90) days before the date fixed for
the next ensuing annual meeting of shareholders of the Company and all holders
of the Series B Preferred Shares and shares of any other class or series of
preferred shares of the Company ranking on a parity with the Series B Preferred
Shares with respect to distribution rights are afforded the opportunity to elect
such additional trustee or trustees (or fill any vacancy) at such annual meeting
of shareholders.
If and when all accumulated distributions on the Series B Preferred Shares
have been authorized and paid or set aside for payment in full, the holders of
the Series B Preferred Shares shall be divested of the special voting rights
provided by this subparagraph (2) of paragraph (E), subject to revesting in the
event of each and every subsequent Preferential Distribution NonPayment. Upon
termination of such special voting rights attributable to all holders of the
Series B Preferred Shares and shares of any other class or series of preferred
shares of the Company ranking on a parity with the Series B Preferred Shares
with respect to distribution rights, the term of office of each trustee elected
by the holders of the Series B Preferred Shares and such parity preferred shares
(a "Preferred Shares Trustee") pursuant to such special voting rights shall
forthwith terminate and the number of trustees constituting the entire Board of
Trustees shall be reduced by the number of Preferred Shares Trustees. Any
Preferred Shares Trustee may be removed only by the vote of the holders of
record of a majority of the outstanding Series B Preferred Shares and all other
series of preferred shares of the Company ranking on a parity with the Series B
Preferred Shares with respect to distribution rights who would then be entitled
to vote in such Preferred Shares Trustee's election, voting together as a
separate class, at a meeting called for such purpose.
3. So long as any Series B Preferred Shares are outstanding, the number
of trustees constituting the entire Board of Trustees of the Company shall at
all times be such that the exer-
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<PAGE> 13
cise, by the holders of the Series B Preferred Shares and the holders of
preferred shares of the Company ranking on a parity with the Series B Preferred
Shares with respect to distribution rights, of the right to elect trustees under
the circumstances provided for in subparagraph (2) of this paragraph (E) will
not contravene any provision of the Declaration of Trust restricting the number
of trustees which may constitute the entire Board of Trustees.
4. Trustees elected pursuant to subparagraph (2) of this paragraph (E)
shall serve until the earlier of (x) the next annual meeting of the shareholders
of the Company and the election (by the holders of the Series B Preferred Shares
and the holders of preferred shares of the Company ranking on a parity with the
Series B Preferred Shares with respect to distribution rights) and qualification
of their respective successors or (y) the termination of the term of office of
each Preferred Shares Trustee upon the termination of the special voting rights
as provided for in subparagraph (2) of this paragraph (E) or as otherwise
provided for in subparagraph (2) of this paragraph (E).
5. So long as a Preferential Distribution Non-Payment shall continue, any
vacancy in the office of a Preferred Shares Trustee may be filled by vote of the
holders of record of a majority of the outstanding Series B Preferred Shares and
all other series of preferred shares ranking on a parity with the Series B
Preferred Shares with respect to distribution rights who are then entitled to
vote in the election of such Preferred Shares Trustee as provided above. As long
as the Preferential Distribution Non-Payment shall continue, holders of the
Series B Preferred Shares shall not, as such shareholders, be entitled to vote
on the election or removal of trustees other than Preferred Shares Trustees, but
shall not be divested of any other voting rights provided to such shareholders
by law, the Declaration of Trust and these Articles Supplementary with respect
to any other matter to be acted upon by the shareholders of the Company.
F. Trustees' Right to Refuse to Transfer Series B Preferred Shares;
Limitation on Holdings.
1. The terms and provisions of this paragraph (F) shall apply in addition
to, and not in limitation of, the terms and provisions of Section 6.6 of the
Declaration of Trust.
2. Each Person who owns directly or indirectly more than five percent in
number or value of the total Series B Preferred Shares outstanding shall, by
January 30 of each year, give written notice to the Company stating the Person's
name and address, the number of Series B Preferred Shares directly or indirectly
owned by such Person, and a description of the capacity in which such Series B
Preferred Shares are held. For purposes of these Articles Supplementary, the
number and value of
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<PAGE> 14
the total Series B Preferred Shares outstanding shall be determined by the Board
of Trustees in good faith, which determination shall be conclusive for all
purposes hereunder. In addition, each direct or indirect holder of Series B
Preferred Shares, irrespective of such shareholder's percentage ownership of
outstanding Series B Preferred Shares, shall upon demand disclose to the Company
in writing such information with respect to the direct or indirect ownership of
Series B Preferred Shares as the Board of Trustees deems necessary from time to
time to enable the Board of Trustees to determine whether the Company complies
with the REIT Provisions of the Code (as defined in Section 1.5 of the
Declaration of Trust), to comply with the requirements of any taxing authority
or governmental agency or to determine any such compliance or to determine any
such compliance with this paragraph (F).
3. If, in the opinion of the Board of Trustees, which shall be binding
upon any prospective acquiror of Series B Preferred Shares, any proposed
transfer or issuance would jeopardize the status of the Company as a REIT under
the REIT Provisions of the Code, the Board of Trustees shall have the right, but
not the duty, to refuse to permit such transfer or issuance or refuse to give
effect to such transfer or issuance and to take any action to void any such
issuance or cause any such transfer not to occur.
4. As a condition to any transfer and/or registration of transfer on the
books of the Company of any Series B Preferred Shares which could result in
direct or indirect ownership (as hereinafter defined) of Series B Preferred
Shares exceeding 9.9% of the lesser of the number or the value of the total
Series B Preferred Shares outstanding (the "Series B Excess Preferred Shares")
by a Person other than a Series B Preferred Excepted Person (as defined in
subparagraph (5) below), such prospective transferee shall give written notice
to the Company of the proposed transfer and shall furnish such opinions of
counsel, affidavits, undertakings, agreements and information as may be required
by the Board of Trustees no later than the 15th day prior to any transfer which,
if consummated, would result in such ownership.
5. Any transfer of Series B Preferred Shares that would (i) create a
direct or indirect owner of Series B Excess Preferred Shares other than a Series
B Preferred Excepted Person; (ii) result in the Series B Preferred Shares being
owned by fewer than 100 Persons for purposes of the REIT provisions of the Code;
or (iii) result in the Company being "closely held" within the meaning of
Section 856(h) of the Code, shall be void ab initio and the prospective acquiror
shall not be entitled to any rights afforded to owners of Series B Preferred
Shares hereunder and shall be deemed never to have had an interest therein. Any
issuance of Series B Preferred Shares that would (i) create a
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<PAGE> 15
direct or indirect owner of Series B Excess Preferred Shares other than a Series
B Preferred Excepted Person; or (ii) result in the Company being "closely held"
within the meaning of Section 856(h) of the Code, shall be void ab initio and
the prospective acquiror shall not be entitled to any rights afforded to owners
of Series B Preferred Shares hereunder and shall be deemed never to have had an
interest therein.
"Series B Preferred Excepted Person" shall mean any Person approved by the
Board of Trustees, at their option and in their sole discretion, provided,
however, that such approval shall not be granted to any Person whose ownership
of in excess of 9.9% of the lesser of the number or the value of the total
Series B Preferred Shares outstanding would result, directly, indirectly or as a
result of attribution of ownership, in termination of the status of the Company
as a REIT under the REIT Provisions of the Code.
6. The Company, by notice to the holder thereof, may purchase any or all
Series B Preferred Shares that are proposed to be transferred pursuant to a
transfer which, in the opinion of the Board of Trustees, which shall be binding
upon any proposed transferee of Series B Preferred Shares, would result in any
Person acquiring Series B Excess Preferred Shares, or would otherwise jeopardize
the status of the Company as a real estate investment trust under the REIT
Provisions of the Code. The purchase price for any Series B Excess Preferred
Shares to be transferred shall be equal to the fair market value of the Series B
Preferred Shares on the last trading day immediately preceding the day on which
notice of such proposed transfer is sent, as reflected in the closing sale price
for the Series B Preferred Shares, if then listed on a national securities
exchange, or such price for the Series B Preferred Shares on the principal
exchange if then listed on more than one national securities exchange, or if the
Series B Preferred Shares are not then listed on a national securities exchange,
the latest bid quotation for the Series B Preferred Shares if then traded
over-the-counter, or, if no such closing sales prices or quotations are
available, then the purchase price shall be equal to the fair market value of
such Series B Preferred Shares as determined by the Board of Trustees in good
faith. Prompt payment of the purchase price shall be made in cash by the Company
in such manner as may be determined by the Board of Trustees. From and after the
date fixed for purchase by the Board of Trustees, and so long as payment of the
purchase price for the Series B Preferred Shares to be so redeemed shall have
been made or duly provided for, the holder of any Series B Excess Preferred
Shares so called for purchase shall cease to be entitled to dividends,
distributions, voting rights and other benefits with respect to such Series B
Preferred Shares, excepting only the right to payment of the purchase price
fixed as aforesaid. Any dividend or distribution paid to a proposed transferee
of Series B Excess Preferred Shares
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<PAGE> 16
prior to the discovery by the Company that the Series B Preferred Shares have
been transferred in violation of this paragraph (F) shall be repaid to the
Company upon demand. The rights granted to the Company in this subparagraph (6)
shall not limit the effect of, restrictions in, or rights of the Company or the
Board of Trustees under, any other provision of this paragraph (F).
7. Notwithstanding any other provision in these Articles Supplementary,
the Declaration of Trust or the Company's Bylaws, subparagraphs (5), (6), (7)
and (8) of this paragraph (F) may not be amended or repealed without the
affirmative vote of the holders of not less than two-thirds of the Series B
Preferred Shares then outstanding and entitled to vote. If subparagraph (5),
(6), (7) or (8) of this paragraph (F) is determined to be void or invalid by
virtue of any legal decision, statute, rule or regulation, then the acquiror of
Series B Preferred Shares in violation of such sections shall be deemed, at the
option of the Company, to have acted as agent on behalf of the Company in
acquiring such Series B Preferred Shares on behalf of the Company.
8. Subject to subparagraph (12), notwithstanding any other provision of
these Articles Supplementary to the contrary, any purported transfer, sale or
acquisition of Series B Preferred Shares (whether such purported transfer, sale
or acquisition results from the direct or indirect acquisition of ownership of
Series B Preferred Shares) which would result in the termination of the status
of the Company as a real estate investment trust under the REIT Provisions of
the Code shall be null and void ab initio. Any such Series B Preferred Shares
may be treated by the Board of Trustees in the manner prescribed for Series B
Excess Preferred Shares in subparagraph (6) of this paragraph (F).
9. Subject to subparagraphs (11) and (12), nothing contained in this
paragraph (F) or in any other provision of these Articles Supplementary shall
limit the authority of the Board of Trustees to take such other action as it
deems necessary or advisable to protect the Company and the interests of the
shareholders by preservation of the Company's status as a real estate investment
trust under the REIT Provisions of the Code.
10. Subject to subparagraph (11), if any provision of this paragraph (F)
or any application of any such provision is determined to be invalid by any
federal or state court having jurisdiction over the issues, the validity of the
remaining provisions shall not be affected and other applications of such
provision shall be affected only to the extent necessary to comply with the
determination of such court. To the extent this paragraph (F) may be
inconsistent with any other provision of these Articles Supplementary, this
paragraph (F) shall be controlling.
11. For purposes of these Articles Supplementary, Series B Preferred
Shares not owned directly shall be deemed to be owned indirectly by a person if
that person or a group of which he is a member would be the beneficial owner of
such Series B Preferred
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<PAGE> 17
Shares, as defined in Rule 13d-3 under the Securities Exchange Act of 1934, as
amended, and/or would be considered to own such Series B Preferred Shares by
reason of the REIT Provisions of the Code.
12. Notwithstanding any other provision of paragraph (F), nothing in these
Articles Supplementary shall preclude the settlement of transactions entered
into through the facilities of the New York Stock Exchange. The fact that the
settlement of any transaction takes place or occurs shall not negate the effect
of any other provision of this paragraph (F) and any transferee in such a
transaction shall be subject to all of the provisions and limitations set forth
in this paragraph (F).
G. Ranking.
With regard to rights to receive distributions and amounts payable upon
liquidation, dissolution or winding up of the Company, the Series B Preferred
Shares rank senior to the Common Shares, senior to the Nomura Preferred Shares
in the manner and to the extent provided herein and on a parity with any other
preferred shares issued by the Company, unless the terms of such other preferred
shares provide otherwise and, if applicable, the requirements of paragraph (H)
hereof have been complied with. However, the Company may authorize or increase
any class or series of shares of beneficial interest ranking on a parity with or
junior to the Series B Preferred Shares as to distribution rights or liquidation
preference without the vote or consent of the holders of the Series B Preferred
Shares. Notwithstanding that the Series B Preferred Shares rank senior to the
Nomura Preferred Shares in the manner and to the extent provided herein as to
rights to receive distributions and amounts payable upon liquidation,
dissolution or winding up of the Company, the Company shall have the right
(whether or not distributions on the Series B Preferred Shares for all past
Distribution Periods and the then current Distribution Period have been paid)
(i) to mandatorily redeem Series A-1 Preferred Shares in accordance with the
terms set forth in the Series A-1 Articles Supplementary as in existence on the
Original Issue Date, and (ii) to mandatorily redeem any other Nomura Preferred
Shares issued from time to time in accordance with the terms set forth in the
articles supplementary classifying such series of Nomura Preferred Shares, which
terms shall be substantially similar to the mandatory redemption terms set forth
in the Series A-1 Articles Supplementary as in existence on the Original Issue
Date, except that such articles supplementary shall relate to a different
property to be acquired, constructed and/or developed by a separate entity in
which the Company is directly or indirectly a co-participant. Furthermore, so
long as the Series B Preferred Shares are outstanding, the Company may only
exercise its optional redemption rights in respect of the Nomura Preferred
Shares (i) up to an amount equal to the value (as determined below) of the
equity securities issued by the Company and the units of partnership interest
issued by the Operating Partnership (other than those units of partnership
interest issued in
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<PAGE> 18
connection with the issuance by the Company of common equity securities) junior
to the Series B Preferred Shares as to distribution rights and rights upon
liquidation, dissolution and winding up ("Junior Equity") from and after the
date of the consummation of the offering by the Company of its Series B
Preferred Shares and (ii) so long as full cumulative distributions on the Series
B Preferred Shares have been or contemporaneously are authorized and paid or
authorized and a sum sufficient for the payment thereof set apart for payment.
The value of such Junior Equity shall be equal to the product of (A) the total
number of shares or units of Junior Equity issued, and (B) in each case, as
applicable, (i) with respect to issuances of Junior Equity for cash, the amount
of the purchase price therefor, (ii) with respect to issuances of Junior Equity
for property or other consideration, the closing price per Common Share on the
New York Stock Exchange on the date immediately preceding issuance of such
Junior Equity, or (iii) with respect to issuances of Junior Equity which are not
traded on a national exchange or not convertible into equity securities or units
of partnership interest which are traded on a national exchange, as determined
by an investment banking firm.
H. Limitations.
So long as any Series B Preferred Shares are outstanding, the Company
shall not, without the affirmative vote, or the written consent, of the holders
of at least two-thirds of the total number of outstanding Series B Preferred
Shares, voting as a class,
1. authorize, create or issue, or increase the authorized or
issued amount of, any class or series of, or rights to subscribe to
or acquire, any security convertible into, any class or series of
shares of beneficial interest ranking as to distribution rights or
liquidation preference, senior to the Series B Preferred Shares, or
reclassify any shares of beneficial interest into any such shares;
or
2. amend, alter or repeal, whether by merger, consolidation or
otherwise, any of the provisions of the Declaration of Trust
(including these Articles Supplementary) that would change the
preferences, rights or privileges with respect to the Series B
Preferred Shares so as to affect the Series B Preferred Shares
materially and adversely;
but (except as otherwise expressly required by applicable law) nothing herein
contained shall require such a vote or consent (i) in connection with any
increase in the total number of authorized Common Shares; (ii) in connection
with the authorization or increase of any class or series of shares of
beneficial interest ranking, as to distribution rights and liquidation
preference, on a parity with or junior to the Series B Preferred Shares; (iii)
in connection with any merger or consolidation in which the
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<PAGE> 19
Company is the surviving entity if, immediately after the merger or
consolidation, there are outstanding no shares of beneficial interest and no
securities convertible into shares of beneficial interest ranking as to
distribution rights or liquidation preference senior to the Series B Preferred
Shares other than the securities of the Company outstanding prior to such merger
or consolidation; (iv) in connection with any merger or consolidation in which
the Company is not the surviving entity if, as a result of the merger or
consolidation, the holders of Series B Preferred Shares receive shares of stock
or beneficial interest or other equity securities with preferences, rights and
privileges substantially identical to the preferences, rights and privileges of
the Series B Preferred Shares and there are outstanding no shares of stock or
beneficial interest or other equity securities of the surviving entity ranking
as to distribution rights or liquidation preference senior to the Series B
Preferred Shares other than the securities of the Company outstanding prior to
such merger or consolidation; or (v) if, at or prior to the time when the
issuance of any such shares ranking senior to the Series B Preferred Shares is
to be made or any such change is to take effect, as the case may be, the Series
B Preferred Shares have been called for redemption upon proper notice and
sufficient funds have been irrevocably deposited in trust for the redemption of
all the then outstanding Series B Preferred Shares.
I. Exclusion of Other Rights.
The Series B Preferred Shares shall not have any preferences or other
rights, voting powers, restrictions, limitations as to dividends or other
distributions, qualifications or terms or conditions of redemption other than
expressly set forth in the Declaration of Trust.
J. Headings of Subdivisions.
The headings of the various subdivisions hereof are for convenience of
reference only and shall not affect the interpretation of any of the provisions
hereof.
K. Severability of Provisions.
If any preferences or other rights, voting powers, restrictions,
limitations as to dividends or other distributions, qualifications or terms or
conditions of redemption of the Series B Preferred Shares set forth in the
Declaration of Trust is invalid, unlawful or incapable of being enforced by
reason of any rule of law or public policy, all other preferences or other
rights, voting powers, restrictions, limitations as to distributions,
qualifications or terms or conditions of redemption of Series B Preferred Shares
set forth in the Declaration of Trust which can be given effect without the
invalid, unlawful or unenforceable provision thereof shall, nevertheless, remain
in full force and effect and no preferences or other rights, voting powers,
restrictions, limitations as to dividends or other
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<PAGE> 20
distributions, qualifications or terms or conditions of redemption of the Series
B Preferred Shares herein set forth shall be deemed dependent upon any other
provision thereof unless so expressed therein.
L. No Preemptive Rights.
No holder of Series B Preferred Shares shall be entitled to any preemptive
rights to subscribe for or acquire any unissued shares of beneficial interest of
the Company (whether now or hereafter authorized) or securities of the Company
convertible into or carrying a right to subscribe to or acquire shares of
beneficial interest of the Company.
M. Conversion.
The Series B Preferred Shares are not convertible into or exchangeable for
any other property or securities of the Company.
SECOND: The Series B Preferred Shares have been classified by the
Board of Trustees under a power contained in the Declaration of Trust.
THIRD: These Articles Supplementary have been approved by the Board
of Trustees in the manner and by the vote required by law.
FOURTH: Each of the undersigned acknowledges these Articles
Supplementary to be the act of the Company and as to all matters or facts
required to be verified under oath, that to the best of his knowledge,
information and belief, these matters and facts are true in all material
respects and such statement is made under the penalties for perjury.
FIFTH: These Articles Supplementary and all documents, agreements,
understandings and arrangements relating hereto have been entered into or
executed on behalf of the Company by the undersigned in his capacity as a
trustee of the Company, which has been formed as a Maryland real estate
investment trust pursuant to a declaration of trust of the Company dated as of
September 1, 1993, as amended, and not individually, and neither the trustees,
officers nor shareholders of the Company shall be bound or have any personal
liability hereunder or thereunder. Holders of the Series B Preferred Shares
shall look solely to the assets of the Company for satisfaction of any liability
of the Company in respect of these Articles Supplementary and all documents,
agreements, understandings and arrangements relating hereto and will not seek
recourse or commence any action against any of the trustees, officers or
shareholders of the Company or any of their personal assets for the performance
or payment of any obligation hereunder or thereunder. The foregoing shall also
apply to any future documents, agreements, understandings, arrangements or
transactions between the Company and holders of the Series B Preferred Shares.
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<PAGE> 21
IN WITNESS WHEREOF, the Company has caused these Articles
Supplementary to be executed under seal in its name and on its behalf by its
President and attested to by its Secretary on this 14th day of November, 1997.
GLIMCHER REALTY TRUST
By: /s/ David J. Glimcher (Seal)
------------------------------
David J. Glimcher
President
ATTEST:
By: /s/ George A. Schmidt
--------------------------
George A. Schmidt
Secretary
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<PAGE> 1
EXHIBIT 4.3
TEMPORARY CERTIFICATE-EXCHANGEABLE FOR DEFINITIVE ENGRAVED
CERTIFICATE WHEN READY FOR DELIVERY
TGLP GLIMCHER REALTY TRUST
A REAL ESTATE INVESTMENT TRUST FORMED UNDER THE LAWS
OF THE STATE OF MARYLAND
THIS CERTIFICATE IS
TRANSFERABLE IN NEW YORK, N.Y. OR IN CHICAGO, IL.
SEE REVERSE FOR IMPORTANT NOTICE ON TRANSFER RESTRICTIONS
AND OTHER INFORMATION
CUSIP 379302201
THIS CERTIFIES that
is the owner of
FULLY PAID AND NONASSESSABLE ___% SERIES B CUMULATIVE REDEEMABLE PREFERRED
SHARES, $.01 PAR VALUE PER SHARE, OF BENEFICIAL INTEREST OF
GLIMCHER REALTY TRUST
(the "Trust") transferable on the books of the Trust by the holder hereof in
person or by its duly authorized attorney, upon surrender of this Certificate
properly endorsed. This Certificate and the shares represented hereby are issued
and shall be held subject to all of the provisions of the Declaration of Trust
of the Trust and Bylaws and any amendments thereto. This Certificate is not
valid unless countersigned and registered by the Transfer Agent and Registrar.
IN WITNESS WHEREOF, the Trust has caused this Certificate to be executed on
its behalf by its duly authorized officers.
Dated:
Counter/signed and Registered:
HARRIS TRUST AND SAVINGS BANK
Transfer Agent and Registrar
By
Secretary President Authorized Signatory
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<PAGE> 2
IMPORTANT NOTICE
GLIMCHER REALTY TRUST
The Trust will furnish to any shareholder, on request and without charge, a
full statement of the information required by Section 8-203(d) of the
Corporations and Associations Article of the Annotated Code of Maryland with
respect to the designations and any preferences, conversion and other rights,
voting powers, restrictions, limitations as to dividends and other
distributions, qualifications, and terms and conditions of redemption of the
shares of beneficial interest of each class which the Trust has authority to
issue and, if the Trust is authorized to issue any preferred or special class in
series, (i) the differences in the relative rights and preferences between the
shares of each series to the extent set, and (ii) the authority of the Board of
Trustees to set such rights and preferences of subsequent series. The foregoing
summary does not purport to be complete and is subject to and qualified in its
entirely by reference to the Declaration of Trust of the Trust and any
amendments thereto, a copy of which will be sent without charge to each
shareholder who so requests. Such request must be made to the Secretary of the
Trust at its principal office or to the Transfer Agent.
The shares of beneficial interest represented by this Certificate are
subject to restrictions on ownership and transfer and to requirements of notice
and information for the purpose of the Trust's maintenance of its status as a
real estate investment trust under the Internal Revenue Code of 1986, as amended
(the "Code"). If the restrictions on ownership and transfer are violated, the
preferred shares of beneficial interest represented hereby will automatically
become Excess Shares (as defined in the Declaration of Trust) which may be
purchased by the Trust at its sole discretion. The foregoing summary does not
purport to be complete and is subject to and qualified in its entirety by
reference to the Declaration of Trust of the Trust, and any amendments thereto,
a copy of which, including the restrictions on transfer, will be sent without
charge to each shareholder who so requests. Such request must be made to the
Secretary of the Trust at its principal office or to the Transfer Agent.
----------------------------------------
KEEP THIS CERTIFICATE IN A SAFE PLACE. IF LOST, STOLEN
OR DESTROYED, THE TRUST WILL REQUIRE A BOND OF INDEMNITY AS A
CONDITION TO THE ISSUANCE OF A REPLACEMENT CERTIFICATE.
----------------------------------------
The following abbreviations, when used in the inscription on the face of
this Certificate, shall be construed as though they were written out in full
according to applicable laws or regulations:
TEN COM - as tenants in common UNIF GIFT MIN ACT-_______Custodian______
TEN ENT - as tenants by the entireties_______ (Cust) _______ (Minor)
JT TEN - as joint tenants with right _______ under Uniform Gifts to Minors
of survivorship and not as tenants Act for ____________
(State)
Additional abbreviations may also be used though not in the above list.
FOR VALUE RECEIVED, ____________________ hereby sell(s), assign(s) and
transfer(s) unto
PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE
- ---------------------------------------------------------------------------
- ---------------------------------------------------------------------------
(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING ZIP CODE,
OF ASSIGNEE)
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<PAGE> 3
___________________________________________________________________________
____________________________________________________________________ Shares
represented by this Certificate, and do hereby irrevocably constitute
_________________________________________________________________ Attorney
and appoint to transfer the said shares on the books of the Trust
_______________________________________________________________
with full power of substitution in the premises.
Date: __________________________
___________________________________
NOTICE: THE SIGNATURE TO THIS ASSIGNMENT
MUST CORRESPOND WITH THE NAME AS
WRITTEN UPON THE FACE OF THE
CERTIFICATE IN EVERY PARTICULAR,
WITHOUT ALTERATION ON ENLARGEMENT
OR ANY CHANGE WHATEVER
SIGNATURE(S) GUARANTEED: _______________________________________
THE SIGNATURE(S) SHOULD BE GUARANTEED BY
AN ELIGIBLE GUARANTOR INSTITUTION
(BANKS, STOCKBROKERS, SAVINGS AND LOAN
ASSOCIATIONS AND CREDIT UNIONS WITH
MEMBERSHIP IN AN APPROVED SIGNATURE
MEDALLION PROGRAM), PURSUANT TO S.E.C.
RULE 17 Ad-15.
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<PAGE> 1
EXHIBIT 4.4
AMENDMENT NO. 1 TO SECURITIES PURCHASE AGREEMENT
AMENDMENT NO. 1 dated as of November 6, 1997 to the SECURITIES
PURCHASE AGREEMENT dated as of November 26, 1996, as supplemented (as modified,
supplemented or amended from time to time, the "Securities Purchase Agreement"),
among Partnership Acquisition Trust II, a Delaware business trust (together with
its successors and assigns, the "Purchaser"), Glimcher Realty Trust, a Maryland
real estate trust (together with its permitted successors and assigns, "GRT"),
and Glimcher Properties Limited Partnership, a Delaware limited partnership
(together with its successors and assigns, "GPLP"). Capitalized terms not
otherwise defined in this Amendment have the meanings given to them in the
Securities Purchase Agreement.
RECITALS
GRT has previously issued to Purchaser 34,000 Series A Preferred
Shares.
GRT has requested NACC to subordinate the Series A Preferred Shares
and all other Preferred Shares to be issued from time to time under the
Securities Purchase Agreement to the Series B Preferred Shares (the "Series B
Preferred Shares") to be issued in a maximum amount of 5,520,000 shares pursuant
to the Articles Supplementary Classifying 5,520,000 Shares of Beneficial
Interest as Series B Cumulative Redeemable Preferred Shares of Beneficial
Interest of Glimcher Realty Trust in the form of Exhibit A hereto (the "Series B
Articles Supplementary"), such subordination to be to the extent and in the
manner set forth in such Series B Articles Supplementary.
PAT II, as the holder of all the outstanding Series A Preferred
Shares, is willing to consent to such subordination only if, among the other
requirements contained in this Amendment, (1) GRT executes and files with all
requisite authorities Articles Supplementary Classifying and Designating 40,000
Shares of Beneficial Interest as 40,000 Shares of Series A-1 Convertible
Preferred Beneficial Interest (the "Series A-1 Preferred Shares") as set forth
on Exhibit B hereto (the "Series A-1 Articles Supplementary"), (2) all shares of
Series A Preferred Shares are exchanged on a one for one basis for shares of
Series A-1 Preferred Shares and (3) the Securities Purchase Agreement is amended
to provide that all future Preferred Shares to be issued from time to time under
the Securities Purchase Agreement will contain the same terms and provisions as
the Series A-1 Preferred Shares, subject to the dividend options set forth in
Exhibit B-1 to the Securities Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
Section 1. Amendments and Modifications to Securities Purchase
Agreement. PAT II, NACC, GPLP and GRT hereby agree that the provisions of this
Section 1 shall amend and modify any contrary provisions set forth in the
Securities Purchase Agreement:
(a) Creation of Series A-1 Preferred Shares. PAT II, NACC, GPLP and
GRT consent to the creation of the Series A-1 Preferred Shares pursuant to the
Series A-1 Articles Supplementary.
(b) Terms of Future Preferred Shares. PAT II, NACC, GPLP and GRT agree
that all further Preferred Shares to be issued from time to time under the
Securities Purchase Agreement shall be issued pursuant to Articles Supplementary
substantially in the same form as the Series A-1 Articles Supplementary (except
for the dividend rate options set forth in Exhibit B-1 to the Securities
Purchase Agreement).
(c) Exchange of Shares. Subject to the terms and conditions set forth
herein, concurrently with the original issuance of any Series B Preferred
Shares, PAT II agrees to exchange on a one for one basis all Series A Preferred
Shares owned by it for the same number of Series A-1 Preferred Shares. PAT II
agrees to deliver to GRT for cancellation all of such Series A Preferred Shares
in exchange for certificates evidencing the Series A-1 Preferred
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<PAGE> 2
Shares to be issued in exchange therefor. All transfer taxes, if any,
shall be for the account of GRT. PAT II understands that upon delivery to GRT of
such Series A Preferred Shares and receipt of the certificates evidencing the
Series A-1 Preferred Shares, the Series A Preferred Shares will be retired, and
PAT II shall have no further rights or preferences with respect thereto.
Notwithstanding the foregoing, (1) the exchange of PAT II's Series A Preferred
Shares for Series A-1 Preferred Shares shall not be deemed a waiver of any cause
of action which PAT II may have against GRT which arose during the period of
time that PAT II was holder of the Series A Preferred Shares and (2) any and all
rights which PAT II may have under or in connection with any contract,
agreement, instrument or other document arising in connection with the
transaction pursuant to which Series A Preferred Shares were issued shall
continue in respect of Series A-1 Preferred Shares held by PAT II as a
consequence of the exchange contemplated hereby for so long as PAT II remains a
holder thereof, on the same terms and to the same extent as such rights existed
prior to such exchange. Notwithstanding any provision of this Amendment to the
contrary, it is the intent of the parties that Series A-1 Preferred Shares shall
be deemed issued in exchange for the Series A Preferred Shares as of the date of
exchange and all accrued and unpaid dividends on the Series A Preferred Shares
shall be paid in full on the date of the exchange (which shall be the Original
Issuance Date (as defined in the Series A-1 Articles Supplementary) of the
Series A-1 Preferred Shares and shall be computed for all periods on the basis
of the actual number of days elapsed over a year of 360 days.
(d) The provisions set forth above shall be effective only upon the
satisfaction of the following conditions on or before December 15, 1997.
(1) PAT II shall have received certificates evidencing the Series A-1
Preferred Shares.
(2) PAT II shall have received evidence of all requisite corporate and
stockholder approvals, if any, required in connection with the creation and
issuance of the Series A-1 Preferred Shares.
(3) PAT II shall have received legal opinions from counsel to GRT
satisfactory to PAT II in form, scope and substance as to the matters set
forth in (4) below, and the authorization, creation and validity of the
Series A-1 Preferred Shares.
(4) The Series A-1 Preferred Shares shall have been validly created
and issued and the holders shall have received evidence thereof and, if
applicable, the exchange of the Series A Preferred Shares for the Series
A-1 Preferred Shares shall be legal valid and binding.
(5) All members of the Great Plains MetroMall LLC shall have executed
and delivered to NACC the Operating Agreement LLC Modification set forth at
the end of this Amendment.
Section 2. No Waiver or Other Modifications. Except as expressly
amended hereby, the Securities Purchase Agreement shall remain in full force and
effect. Without limiting the foregoing, GRT and GPLP agree that PAT II and NACC
are not obligated to purchase any Preferred Shares except pursuant to the exact
terms and conditions of the Securities Purchase Agreement and are not obligated
to waive or modify any such terms and conditions.
Section 3. Miscellaneous.
(a) Counterparts. This Agreement may be executed by one or more of the
parties to this Agreement on any number of separate counterparts (including by
facsimile transmission), and all of said counterparts taken together shall be
deemed to constitute one and the same instrument.
(b) Governing Law. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York applicable to contracts
made and to be performed entirely within such State.
(c) Fees. GRT will pay upon demand all reasonable fees and expenses
(including reasonable attorneys fees and expenses) of NACC and PAT II in
connection with the negotiation, execution and delivery of this Amendment and
the consummation of the transactions contemplated hereby.
(d) Incorporation by reference. The provisions of Section 4 and
Section 10 of the Securities Purchase Agreement are hereby incorporated by
reference (mutatis mutandis).
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<PAGE> 3
IN WITNESS WHEREOF, the parties hereto have caused this Amendment No
1. to the Securities Purchase Agreement to be executed and delivered by their
duly authorized officers.
GLIMCHER REALTY TRUST
By: /s/ George A. Schmidt
------------------------------------
Name: George A. Schmidt
Title: Sr. Vice President
GLIMCHER PROPERTIES LIMITED PARTNERSHIP
By Glimcher Properties Corporation, its
sole general partner
By: /s/ George A. Schmidt
------------------------------------
Name: George A. Schmidt
Title: Sr. Vice President
PARTNERSHIP ACQUISITION TRUST II
By: Wilmington Trust Company,
as Owner Trustee
By: /s/ Lance W. Haberin
------------------------------------
Name: Lance W. Haberin
Title: Attorney in Fact
NOMURA ASSET CAPITAL CORPORATION
By: /s/ Lance W. Haberin
------------------------------------
Name: Lance W. Haberin
Title: Vice President
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<PAGE> 4
Great Plains MetroMall LLC Operating Agreement Modification
By execution hereof, the undersigned agree that, from and after the
date of issuance of the Series A-1 Preferred Shares in exchange for the Series A
Preferred Shares referred to above, all references contained in the Operating
Agreement of Great Plains MetroMall LLC, a Delaware limited liability company,
to the Series A Preferred Shares shall be deemed to refer to the Series A-1
Preferred Shares.
Dated as of November __, 1997.
OLATHE MALL LLC
By: Glimcher Properties Limited Partnership
By: Glimcher Properties Corporation,
its sole general partner
By: /s/ George A. Schmidt
------------------------------
Name: George A. Schmidt
Title: Senior Vice President
PARTNERSHIP ACQUISITION TRUST III
By: Wilmington Trust Company,
as Owner Trustee
By: /s/ Lance W. Haberin
-----------------------------
Name: Lance W. Haberin
Title: Attorney in Fact
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<PAGE> 5
Registration Rights Agreement Modification
By execution hereof, the undersigned agree that from and after the
date of issuance of the Series A-1 Preferred Shares in exchange for the Series A
Preferred Shares referred to above, all references contained in the Registration
Rights Agreement dated January 26, 1994, and amended as of November 26, 1996, by
and among Glimcher Realty Trust and the other parties identified as Shareholders
in that certain Registration Rights Agreement (the "Agreement"), shall be deemed
to refer to the Series A-1 Preferred Shares. Capitalized terms used herein shall
have the meanings set forth in the Agreement or as otherwise provided herein.
Dated as of November __, 1997
GLIMCHER REALTY TRUST
/s/ George A. Schmidt
By:_____________________________________
Name: George A. Schmidt
Title: Sr. Vice President
SHAREHOLDERS (holding at least two-thirds of all Covered Shares outstanding):
/s/ David J. Glimcher /s/ Herbert Glimcher
_______________________ ______________________
David J. Glimcher Herbert Glimcher
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<PAGE> 1
EXHIBIT 4.5
GLIMCHER REALTY TRUST
ARTICLES SUPPLEMENTARY
CLASSIFYING AND DESIGNATING 40,000
SHARES OF BENEFICIAL INTEREST AS 40,000
SHARES OF SERIES A-1 CONVERTIBLE PREFERRED BENEFICIAL INTEREST
Glimcher Realty Trust, a Maryland real estate investment trust (the
"Corporation"), hereby certifies to the State Department of Assessments and
Taxation of Maryland that:
FIRST: Under a power contained in Article VI, Section 6.3 of the
Declaration of Trust, as amended, of the Corporation (the "Declaration"), the
Board of Trustees of the Corporation (the "Board of Trustees"), by resolution
duly adopted at a meeting duly called and held on November 10, 1997, classified
and designated 40,000 shares (the "Shares") of beneficial interest (as defined
in the Declaration) as shares of Series A-1 Convertible Preferred Beneficial
Interest, with the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends and other distributions,
qualifications and terms and conditions of redemption set forth on Exhibit 1
hereto, which, upon any restatement of the Declaration, shall be deemed to be
part of Article VI, Section 6.3 of the Declaration.
SECOND: The Shares have been classified and designated by the Board of
Trustees under the authority contained in the Declaration.
THIRD: These Articles Supplementary have been approved by the Board of
Trustees in the manner and by the vote required by law.
FOURTH: Each of the undersigned Trustees of the Corporation
acknowledges these Articles Supplementary to be the act of the Corporation and,
as to all matters or facts required to be verified under oath, each of the
undersigned acknowledges that to the best of his knowledge, information and
belief, these matters and facts are true in all material respects and that this
statement is made under the penalties for perjury.
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<PAGE> 2
IN WITNESS WHEREOF, the Corporation has caused these Articles
Supplementary to be executed under seal in its name and on its behalf by
its President and attested to by its Secretary on this 14th day of
November, 1997.
ATTEST: GLIMCHER REALTY TRUST
/s/ George A. Schmidt /s/ David J. Glimcher
________________________________ By:_______________________(SEAL)
George A. Schmidt David J. Glimcher
__________________, Secretary ___________________, President
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<PAGE> 3
EXHIBIT 1
SERIES A-1 CONVERTIBLE PREFERRED SHARES
OF BENEFICIAL INTEREST
SECTION 1. DESIGNATION, AMOUNT AND SUBORDINATION. The shares of the series
of preferred shares of beneficial interest established hereunder is "Series A-1
Convertible Preferred Shares" (the "Series A-1 Preferred Shares") and the number
of shares constituting such series shall be 40,000. The date of original
issuance of any of the Series A-1 Preferred Shares is herein called the
"Original Issuance Date". From and after the Dividend Rate Change Date (as
defined in Section 2), except in connection with transfers, exchanges or
replacements, no Series A-1 Preferred Shares shall be issued at any time on or
after the Dividend Rate Change Date. Notwithstanding anything in these Articles
Supplementary to the contrary, the Series A-1 Preferred Shares rank junior as to
rights to receive distributions and amounts payable upon liquidation,
dissolution or winding up of the Corporation to the Series B Cumulative
Redeemable Preferred Shares of Beneficial Interest of the Corporation (the
"Series B Preferred Shares") to the extent and in the manner set forth in the
terms of the Series B Preferred Shares set forth in the Articles Supplementary
Classifying 5,520,000 Shares of Beneficial Interest as Series B Cumulative
Redeemable Preferred Shares of Beneficial Interest of the Corporation (the
"Series B Articles Supplementary") as such Series B Articles Supplementary are
in effect on the Original Issuance Date.
SECTION 2. DIVIDENDS.
(a) The holders of each Series A-1 Preferred Share shall be entitled
to receive, if, as and when authorized, out of the net profits of the
Corporation, dividends at the annual rate per share of the sum of:
(1) the Applicable Dividend Amount (provided, however, that such
amount shall change on the Dividend Rate Change Date, if any, to the amount
set forth in the Dividend Rate Change Notice), plus
(2) during any Deferral Period (as defined below), including any
portion of a Deferral Period in effect prior to termination thereof, Five
Dollars ($5.00) per annum, plus
(3) for any portion of a Quarterly Dividend Payment Period during
which a Default shall exist, Forty Dollars ($40.00) per annum (the "Default
Dividend Amount").
Dividends shall be payable in quarterly installments on each April 1, July 1,
October 1 and January 1 (or if any such date is not a Business Day, on the next
succeeding Business Day, such date being herein called a "Quarterly Payment
Date"), commencing on the first such date after the Original Issuance Date. The
term "Dividend Rate Change Date" shall mean the date set forth in a written
notice from the Corporation to each Holder of Series A-1 Preferred Shares, which
notice shall (i) be irrevocable, (ii) set forth the Dividend Rate Change Date
(which date shall be at least fifteen days after the date of such notice and
which Dividend Rate Change Date shall not be later than the earlier of the date
of the final issuance of shares of Series A-1 Preferred Shares and the date
which is the first anniversary of the Original Issuance Date of shares of the
Series A Convertible Preferred Beneficial Interest) (which anniversary is
November 27, 1997) on and after which the dividend rate per annum per share of
Series A-1 Preferred Shares shall be equal to the sum of:
(1) an amount equal to the product (expressed in dollars and cents
rounded upward to the nearest cent) of (x) the Liquidation Preference in
effect from time to time multiplied by (y) the sum of (i) .02850 plus (ii)
a percentage, expressed as a decimal, and rounded upward to the nearest
hundred thousandth, equal to the yield to maturity of actively traded (on a
basis consistent with other U.S. Treasury fixed rate securities)
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<PAGE> 4
marketable U.S. Treasury fixed rate securities (as quoted on the
Cantor-Fitzgerald Treasury Screen) having a remaining maturity of as close
to, but not less than, four years after the second Business Day prior to
the Dividend Rate Change Date, plus
(2) during any Deferral Period, including any portion of a Deferral
Period in effect prior to termination thereof, Five Dollars ($5.00) per
annum, plus
(3) for any portion of a Quarterly Dividend Payment Period during
which a Default shall exist, Forty Dollars ($40.00) per annum, plus
(4) for each Quarterly Dividend Payment Period or portion thereof, an
amount equal to the product (expressed in dollars and cents rounded upward
to the nearest cent) of (x) the Liquidation Preference in effect from time
to time multiplied by (y) the Applicable Spread.
Promptly (and in any event within two (2) Business Days after the Dividend Rate
Change Date), the Corporation shall notify each Holder of Series A-1 Preferred
Shares in writing of the dividend rate per share. Such dividends shall be paid
before any dividends shall be set apart for or paid upon the Common Shares or
any other preferred shares ranking on liquidation junior to the Series A-1
Preferred Shares (the "Junior Preferred Shares" and together with the Common
Shares, the "Junior Shares") in any year. All dividends authorized upon Series
A-1 Preferred Shares shall be authorized pro rata per share. Dividends payable
on the Series A-1 Preferred Shares for any period shall be computed on the basis
of the actual number of days elapsed over a year of 360 days. The Corporation
shall not be required to pay dividends during any Deferral Period (as defined
below) except that, the Default Dividend Amount, if any, accrued during any
Quarterly Dividend Payment Period shall be payable on the related Quarterly
Payment Date.
The term "Applicable Dividend Amount" means an amount equal to the
product (expressed in dollar and cents and rounded upward to the nearest cent)
of (x) the Liquidation Preference times (y) the sum of .02850 plus the
Applicable Spread plus LIBOR (expressed as a decimal rounded upwards to the
nearest hundred thousandth (.00000)) and shall be determined on the applicable
Dividend Determination Date for each Quarterly Dividend Payment Period.
The term "Applicable Preferred Shares Amount" means with respect to
any period the highest aggregate liquidation preference of all Preferred Shares
of Beneficial Interest of the Corporation issued at any time under the
Securities Purchase Agreement dated as of November 26, 1996, as supplemented (as
modified, supplemented or amended from time to time, the "Securities Purchase
Agreement"), among Partnership Acquisition Trust II, a Delaware business trust,
Nomura Asset Capital Corporation, the Corporation, and Glimcher Properties
Limited Partnership, a Delaware limited partnership, which were outstanding on
any date during such period.
The term "Applicable Spread" shall be determined on the last day of a
Quarterly Dividend Period or other applicable period (and shall be applicable to
every day during such Quarterly Dividend Period or other applicable period) to
be the decimal determined below:
Applicable
Preferred
Shares Adjusted Equity Ration as of the last day of the Quarterly
Amount Dividend Period or other applicable period
Greater Greater Greater
than or than or than or
Greater equal to equal to equal to
than or .4200 but .3700 but .3200 but
equal to Less than Less than Less than Less than
.47000 .4700 .4200 .3700 .3200
-2-
<PAGE> 5
Equal to .00000 .00250 .01200 .02000 .03200
or less
than $100
million
Greater .00000 .00500 .01700 .02600 .03700
than $100
million
but less
than $200
million
Greater .00000 .00750 .02000 .03000 .04000
than or
equal to
$200
million
The term "Adjusted Equity Ratio" shall mean as of any date of
determination, the ratio (expressed as a decimal to the nearest hundred
thousandth (.00000)) of:
(x) the sum of (i) the aggregate liquidation preference of all
outstanding Junior Preferred Shares plus (ii) the product, expressed in dollars,
of (A) the number of outstanding Common Shares as of the determination date
(including without duplication any Common Shares which would be issuable upon
conversion of any limited partnership interests in Glimcher Properties Limited
Partnership, a Delaware limited partnership) not owned by the Corporation times
(B) the average Market Price (as defined in Section 5(a) hereof) of the Common
Shares during the Quarterly Dividend Period (or portion thereof, if applicable)
prior to the determination date, to
(y) the sum, without duplication, of (i) the amount determined in the
foregoing clause (x), plus (ii) the liquidation preference of all Preferred
Shares of Beneficial Interest of the Corporation (other than Junior Preferred
Shares), plus (iii) the total consolidated debt of the Corporation determined in
accordance with GAAP.
For purposes of computing the Applicable Dividend Rate for any
Quarterly Dividend Period the Adjusted Equity Ratio shall be the ratio on the
last day of such Quarterly Dividend Period (e.g., the ratio in effect for the
entire period January 1 through March 31 shall be the ratio computed on March
31).
The term "Business Day" shall mean any day (other than a Saturday,
Sunday or legal holiday in the State of New York) on which banks are open for
business in New York City.
The term "Common Shares" means the Common Shares of Beneficial
Interest, $.01 par value per share, of the Corporation.
The term "Debt" of any Person means indebtedness of such Person for
borrowed money outstanding (including (i) obligations under capitalized leases,
(ii) obligations for the deferred purchase price of property (other than trade
payables), (iii) liabilities evidenced by notes, bonds or similar instruments,
(iv) guarantees by such Person of any of the foregoing incurred by any other
person, and (v) any of the foregoing obligations for which such Person is
otherwise liable in any other manner such as liability
-3-
<PAGE> 6
resulting from such Person being a general partner of the partnership incurring
the foregoing obligation).
The term "Default" shall mean the existence of any of the following
events:
(i) The failure of the Corporation to maintain at the end of each
fiscal quarter, commencing September 30, 1997, a ratio of Consolidated Debt
of the Corporation and its consolidated subsidiaries to Consolidated Total
Assets of the Corporation and its consolidated subsidiaries of no more than
.60 to 1.00 and such failure shall have continued for a period of 120
consecutive days. The term "Consolidated Debt" of any Person shall mean, as
of any date of determination, without duplication, the total consolidated
Debt of such Person and its consolidated subsidiaries, determined in
accordance with generally accepted accounting principles ("GAAP") except as
otherwise provided herein. The term "Consolidated Total Assets" of any
Person shall mean, as of any date of determination, the sum, without
duplication, of (i) the cash and cash equivalents (excluding any cash held
in escrow) of the Corporation and its consolidated subsidiaries, (ii) the
cost of all Recently Developed Real Properties included in the consolidated
balance sheet of the Corporation in accordance with GAAP, (iii) the cost of
all Recently Acquired Operating Real Properties included in the
consolidated balance sheet of the Corporation in accordance with GAAP plus
(iv) the aggregate value of all real properties (other than Recently
Developed Real Properties and Recently Acquired Operating Real Properties)
owned by the such Person and its consolidated subsidiaries, determined in
accordance with GAAP, except that the value of such real properties shall
be determined by applying a 9.50% capitalization rate to the Adjusted Net
Income of such Person and its consolidated Subsidiaries. The term "Adjusted
Net Income" as of the end of any fiscal quarter of any Person shall mean
the net income of such Person and its consolidated subsidiaries for the
twelve months then ended computed in accordance with GAAP, but it shall be
computed by (x) excluding from the computation thereof all income and
expense items related to Recently Acquired Operating Real Properties and
Recently Developed Real Properties, general and administrative expenses,
minority interests, interest expenses, depreciation and amortization
expenses, income taxes and items of gain and loss resulting from sales
and/or extraordinary events and (y) including in the computation thereof an
assumed management fee equal to 4% of total revenues. The term "Recently
Acquired Operating Real Property" shall mean each operating real property
acquired by the Corporation and its consolidated subsidiaries until such
property shall have been owned by the Corporation or a consolidated
subsidiary for at least four (4) fiscal quarters, and the term "Recently
Acquired Development Property" shall mean any operating real property under
development by the Corporation or any of its consolidated subsidiaries
until the earliest of (i) the date which is 12 months after the date 85% of
the total gross leaseable area of such property has been leased to tenants
that are open for business on the property and paying rent, (ii) 30 months
after the issuance of a permanent certificate of occupancy for any material
portion of such property and (iii) 48 months after the commencement of
construction in connection with the development of such property.
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<PAGE> 7
(ii) The failure of the Corporation to maintain at the end of each
fiscal quarter, commencing September 30, 1997, a ratio of Adjusted
Consolidated Debt to Adjusted Consolidated Total Assets of no more than .70
to 1.00 and such failure shall have continued for a period of 120
consecutive days. For purposes of this calculation (a) the term "Adjusted
Consolidated Debt" shall mean Consolidated Debt of the Corporation and its
consolidated subsidiaries plus, with respect to any Debt of any
unconsolidated entity, the sum, without duplication, of (x) the Corporation
and its consolidated subsidiaries' pro rata share of such unconsolidated
entity's consolidated Debt which is not Debt of the Corporation or any of
its consolidated subsidiaries, (but the amount included pursuant to this
clause (x) with respect to any unconsolidated entity shall not exceed the
amount of the Corporation and its consolidated subsidiaries' pro rata share
of the consolidated assets of such unconsolidated entity using the method
of computation set forth in the definition of Consolidated Total Assets)
plus (y) without duplication, to the extent in excess of the amount
included in the foregoing clause (x), the aggregate amount of the
Corporation and its consolidated subsidiaries' Debt relative to such
unconsolidated entity 's Consolidated Debt; and (b) the term "Adjusted
Consolidated Total Assets" shall mean Consolidated Total Assets of the
Corporation and its consolidated subsidiaries plus, with respect to any
consolidated assets of an unconsolidated entity, the Corporation and its
consolidated subsidiaries' pro rata share of the consolidated assets of
such unconsolidated entity using the method of computation set forth in the
definition of Consolidated Total Assets.
(iii) The indebtedness in the aggregate principal amount of
$181,000,000 incurred under the Amended and Restated Loan Agreement dated
as of March 15, 1994 among Nomura Asset Capital Corporation, Glimcher
Holdings Limited Partnership, Glimcher Centers Limited Partnership and
Grand Central Limited Partnership shall have been refinanced in whole or in
part without the prior written consent of Nomura Asset Capital Corporation.
(iv) The Corporation shall have issued any Shares in violation of
Section 4(b) hereof.
(v) Dividends on any shares of Series A-1 Preferred Shares shall be
in arrears for two or more Quarterly Dividend Payment Periods (except as a
result of a Deferral Period being in effect).
The term "Deferral Period" shall mean a period specified in writing by
the Corporation to the holders of the Series A-1 Preferred Shares during which
the development project to be developed directly or indirectly from the proceeds
of the issuance of the Series A-1 Preferred Shares is under construction and
that the proviso hereto has been satisfied; provided, however, that (i) no such
period may be less than a fiscal quarter and may not extend beyond December 31,
1997, (ii) no such period shall commence during, and any existing period shall
terminate immediately upon (but without affecting the dividend rate in effect
prior to such termination), any Default.
The term "Dividend Determination Date" shall mean (i) with respect to
the first Quarterly Dividend Payment Period, the date which is two (2) Business
Days prior to October 1, 1997, and (ii) with respect to all other Quarterly
Dividend Payment Periods, the date which is two (2)
-5-
<PAGE> 8
Business Days prior to the first day of such Quarterly Dividend Payment Period.
The term "LIBOR" shall mean, with respect to any Quarterly Dividend
Period, the 3 month London Interbank Offered Rate for United States dollar
deposits as of 11:00 a.m. (London time) on the Dividend Determination Date as
quoted on Telerate page 3750 or on such replacement system as is then
customarily used to quote LIBOR. If two or more such rates appear on Telerate
page 3750 or associated pages, LIBOR in respect of such Quarterly Dividend
Payment Period shall be the arithmetic mean of such offered rates. If two such
rates do not appear on Telerate Page 3750 as of 11:00 a.m., London time, on the
applicable Dividend Determination Date, LIBOR will be the arithmetic mean of the
offered rates (expressed as a percentage per annum) for deposits in U.S. Dollars
for a 3 month period that appear on the Reuters Screen LIBO Page (as defined
below) as of 11:00 a.m., London time, on such Dividend Determination Date, if at
least two such offered rates so appear. If fewer than two such offered rates
appear on the Reuters Screen LIBO Page as of 11:00 a.m., London time, on such
Dividend Determination Date, the Corporation will request the principal London
office of any four major reference banks in the London interbank market selected
by the Corporation in good faith to provide such bank's offered quotation
(expressed as a percentage per annum) to prime banks in the London interbank
market for deposits in U.S. Dollars for a three month period as of 11:00 a.m.,
London time, on such Dividend Determination Date for amounts of not less than
U.S. $1,000,000. If at least two such offered quotations are so provided, LIBOR
will be the arithmetic mean of such quotations. If fewer than two such
quotations are so provided, the Corporation will request any three major banks
in New York City selected by the Corporation in good faith to provide such
bank's rate (expressed as a percentage per annum) for loans in U.S. Dollars to
leading European banks for a three month period as of approximately 11:00 a.m.,
New York City time, on the applicable Dividend Determination Date for amounts of
not less than U.S. $1,000,000. If at least two such rates are so provided, LIBOR
will be the arithmetic mean of such rates. If fewer than two rates are so
provided, then LIBOR will be LIBOR in effect on the preceding Dividend
Determination Date.
The term "Liquidation Preference" shall mean, as of any date of
determination, (x) if such date is prior to the later of the commencement of the
Conversion Period (without regard to the application of Section 5(g))and the
Conversion Termination Date (as defined in Section 5(g)), $1,000, and (y) at all
times thereafter, the quotient of $1,000 divided by the Applicable Conversion
Percentage as of the date of determination. Every change in the Applicable
Conversion Percentage on or after the later of (x) the commencement of the
Conversion Period (without regard to the application of Section 5(g)) or (y) the
Conversion Termination Date shall effect a change in the Liquidation Preference
as of the date of each such change.
The term "Quarterly Dividend Payment Period" shall mean the period
beginning on and including the last day of each March, June, September and
December of each year and ending on the second to last day of the first to occur
of the next June, September, December and March, respectively, except that the
initial Quarterly Dividend Payment Period shall be the period beginning on the
Original Issuance Date and ending on the next March 31, June 30, September 30
and December 31.
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(b) Dividends on the Series A-1 Preferred Shares shall be cumulative,
so that if in any fiscal year or years, dividends in whole or in part are not
paid upon the Series A-1 Preferred Shares, unpaid dividends shall accumulate as
against the holders of the Junior Shares. Dividends on the Series A-1 Preferred
Shares shall accrue whether or not the Corporation has earnings, whether or not
there are funds legally available for the payment of such dividends and whether
or not such dividends are authorized. Accrued but unpaid dividends on the Series
A-1 Preferred Shares will accumulate as of the Quarterly Payment Date on which
they first become payable. Each dividend, to the extent not paid on an
applicable Quarterly Payment Date, shall accrue (whether or not the Corporation
has earnings, whether or not there are funds legally available for the payment
of such dividends and whether or not such dividends are authorized) on a daily
basis additional cumulative dividends at the then applicable dividend rate for
the Series A-1 Preferred Shares. Any dividend payment made on the Series A-1
Preferred Shares shall first be credited against the earliest accrued but unpaid
dividend due which remains payable.
(c) For so long as the Series A-1 Preferred Shares remain outstanding,
the Corporation shall not pay any dividend upon the Junior Shares, whether in
cash or other property (other than shares of Junior Shares), or purchase, redeem
or otherwise acquire any such Junior Shares unless, in addition to the payment
of the dividend to the holders of the Series A-1 Preferred Shares as described
above, the Corporation has redeemed all shares of Series A-1 Preferred Shares
which it would theretofore have been required to redeem under Section 7 hereof.
Notwithstanding the provisions of this Section 2(c), without authorizing or
paying dividends on the Series A-1 Preferred Shares, the Corporation may, (1)
subject to applicable law, repurchase or redeem shares of Common Shares of the
Corporation from current or former officers or employees of the Corporation
pursuant to the terms of repurchase or similar agreements in effect from time to
time, provided that such agreements have been approved by the Board of Trustees
of the Corporation and the terms of such agreements provide for a repurchase or
redemption price not in excess of the price per share paid by such employee for
such share, (2) set aside, authorize or pay dividends on the Common Shares of
the Corporation to the extent required in order to maintain the status of the
Corporation as a real estate investment trust under the provisions of Sections
856 through 858 of the Internal Revenue Code of 1986, as amended, but only to
the extent that the foregoing cannot be achieved through the payment of
dividends on the Series A-1 Preferred Shares except that, on only one dividend
payment date with respect to the Common Shares, the amount of such dividends
payable on the Common Shares may be computed based on the assumption that the
foregoing cannot be achieved through the payment of dividends on the Series A-1
Preferred Shares, and (3) redeem Shares pursuant to Section 6.6 of the
Declaration.
(d) Promptly (and in any event within three Business Days) after each
Dividend Determination Date, including any date relating to a Quarterly Dividend
Payment Period during a Deferral Period, the Corporation shall forthwith file at
each office designated for the conversion of Series A-1 Preferred Shares, a
statement, signed by the Chairman of the Board, the President, any Vice
President or Treasurer of the Corporation, setting forth the Applicable Dividend
Amount (including LIBOR and the Applicable Spread) for the following Quarterly
Dividend Payment Period. The Corporation shall also cause a notice setting forth
such information to be sent by mail, first class, postage prepaid, to each
record holder of Series A-1 Preferred Shares at his or its address appearing on
the Preferred
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<PAGE> 10
Shares register except that such notice need not be sent, unless requested by a
holder of Preferred Shares, if such information has not changed from the prior
Dividend Determination Date.
(e) Notwithstanding anything in this Section 2 to the contrary, so
long as any Series B Preferred Shares shall remain outstanding, the provisions
of Section B(3) of the Series B Preferred Articles Supplementary shall supersede
this Section 2.
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SECTION 3. LIQUIDATION, DISSOLUTION OR WINDING UP.
(a) In the event of any voluntary or involuntary liquidation,
dissolution or winding up of the Corporation, the holders of shares of Series
A-1 Preferred Shares then outstanding shall be entitled to be paid out of the
assets of the Corporation available for distribution to its Shareholders, after
and subject to the payment in full of all amounts required to be distributed to
the holders of any other Preferred Shares of the Corporation ranking on
liquidation prior and in preference to the Series A-1 Preferred Shares (such
Preferred Shares being referred to hereinafter as "Senior Preferred Shares")
upon such liquidation, dissolution or winding up, but before any payment shall
be made to the holders of Junior Shares, an amount equal to the Liquidation
Preference per share plus any accrued dividends thereon (whether or not there
are funds legally available for the payment of such dividends and whether or not
such dividends are authorized) (subject to adjustment in the event of any
dividend, split, distribution or combination with respect to such shares). If
upon any such liquidation, dissolution or winding up of the Corporation the
remaining assets of the Corporation available for the distribution to its
Shareholders after payment in full of amounts required to be paid or distributed
to holders of Senior Preferred Shares shall be insufficient to pay the holders
of shares of Series A-1 Preferred Shares the full amount to which they shall be
entitled, the holders of shares of Series A-1 Preferred Shares, and any class of
Shares ranking on liquidation on a parity with the Series A-1 Preferred Shares,
shall share ratably in any distribution of the remaining assets and funds of the
Corporation in proportion to the respective amounts which would otherwise be
payable in respect to the shares held by them upon such distribution if all
amounts payable on or with respect to said shares were paid in full.
(b) After the payment of all preferential amounts required to be paid
to the holders of Senior Preferred Shares and Series A-1 Preferred Shares and
any other series of Preferred Shares upon the dissolution, liquidation or
winding up of the Corporation, the holders of shares of Common Shares then
outstanding shall be entitled to receive the remaining assets and funds of the
Corporation available for distribution to its Shareholders.
(c) Any merger or consolidation of the Corporation into or with
another corporation, any merger or consolidation of any other corporation into
or with the Corporation, or any sale, conveyance, mortgage, pledge or lease of
all or substantially all the assets of the Corporation shall be deemed to be a
liquidation, dissolution or winding up of the Corporation for purposes of this
Section 3 unless approved pursuant to Section 4 (or approval is not required as
set forth in clause (b)(iii)(b) thereof).
(d) In determining whether a distribution (other than upon voluntary
or involuntary liquidation), by dividend, redemption or other acquisition of
shares or otherwise, is permitted under the Maryland General Corporation Law,
amounts that would be needed, if the Corporation were to be dissolved at the
time of the distribution, to satisfy the preferential rights upon dissolution of
holders of Preferred Shares whose preferential rights upon dissolution are
superior to those receiving the distribution shall not be added to the
Corporation's total liabilities.
(e) Notwithstanding anything in this Section 3 to the contrary, so
long as any Series B Preferred Shares shall remain outstanding, the
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<PAGE> 12
provisions of Section C of the Series B Preferred Articles Supplementary shall
supersede this Section 3.
SECTION 4. VOTING
(a) Whenever dividends on any shares of Series A-1 Preferred Shares
shall be in arrears for two or more Quarterly Dividend Payment Period (except as
a result of a Deferral Period being in effect) or a Default shall have occurred
and be continuing (either event being herein called a "Preferred Default"), the
number of members of the Board of Trustees of the Corporation shall be increased
by two and the holders of Series A-1 Preferred Shares shall have the exclusive
right, voting separately as a class together with the holders of other shares of
convertible preferred shares issued from time to time pursuant to the Securities
Purchase Agreement dated as of November 26, 1996 between GRT, GPLP and
Partnership Acquisition Trust II, a Delaware business trust, (collectively, the
"Pari Passu Shares"), to elect two Trustees (herein referred to as the "Series
A-1 Trustees"). All such Series A-1 Trustees shall be elected by the affirmative
vote of the holders of record of a majority of the outstanding Pari Passu Shares
either at meetings of Shareholders at which Trustees are elected, a special
meeting of holders of Pari Passu Shares or by unanimous written consent without
a meeting in accordance with the Corporations and Associations Article of the
Annotated Code of Maryland, and at each subsequent meeting until all dividends
accumulated on such shares of Series A-1 Preferred Shares for the past Quarterly
Dividend Payment Periods and the dividend for the then current Quarterly
Dividend Payment Period shall have been fully paid or authorized and a sum
sufficient for the payment thereof set aside for payment and there shall not
exist any Default. Each Series A-1 Trustee so elected shall serve for a term of
one year and until his successor is elected and qualified. Any vacancy in the
position of a Series A-1 Trustee may be filled only by the holders of the Pari
Passu Shares. Each Series A-1 Trustee may, during his term of office, be removed
at any time, with or without cause, by and only by the affirmative vote, at a
special meeting of holders of Pari Passu Shares called for such purpose, or the
written consent, of the holders of record of a majority of the outstanding
shares of Pari Passu Shares. Any vacancy created by such removal may also be
filled at such meeting or by such consent. If and when all accumulated dividends
and the dividend for the then current dividend period on the Series A-1
Preferred Shares shall have been paid in full or set aside for payment in full
and there shall exist no Default, the holders thereof shall be divested of the
foregoing voting rights (subject to revesting in the event of each and every
Preferred Default) and, if all accumulated dividends and the dividend for the
then current dividend period have been paid in full or set aside for payment in
full on all Pari Passu Shares upon which like voting rights have been conferred
and are exercisable, the term of office of each Series A-1 Trustee shall
terminate forthwith.
(b) In addition to any other rights provided by law, so long as any
Series A-1 Preferred Shares are outstanding, the Corporation shall not, without
first obtaining the affirmative vote or, if permitted by applicable law, the
written consent of the holders of a majority of the Series A-1 Preferred Shares:
(i) amend or repeal any provision of the Declaration or Bylaws which
would have a dilutive effect on the Series A-1 Preferred Shares, increase
the number of members of the Board of Trustees of the Corporation or
otherwise materially adversely affect the economic
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<PAGE> 13
rights of the Series A-1 Preferred Shares, including permitting the
provisions of Subtitle 7 of Title 3 of the Maryland General Corporation
Law, similar provisions and so-called "poison pills" to apply to any holder
of the Series A-1 Preferred Shares as a result of owning such shares or
common shares upon conversion of any or all of such shares;
(ii) issue any Senior Preferred Shares unless all Series A-1 Preferred
Shares are redeemed with the proceeds thereof or issue any Preferred Shares
(other than Pari Passu Shares) unless all the net proceeds are used to
redeem the Series A-1 Preferred Shares and the Pari Passu Shares;
(iii) authorize or effect (a) any sale, lease, transfer or other
disposition of all or substantially all the assets of the Corporation; (b)
any merger or consolidation or other reorganization of the Corporation with
or into another entity, except any such event if, after giving effect
thereto the Corporation shall be in compliance with the ratios set forth in
clauses (i) and (ii) of the definition of Default or (c) a liquidation,
winding up, dissolution or adoption of any plan for the same; or
(iv) enter into any transaction, other than employment agreements on a
basis consistent with past practice, with any officer, director, trustee or
beneficial owner of five percent (5%) or more of the Common Shares of the
Corporation or any Affiliate of any of the foregoing unless such
transaction is on terms no less favorable to the Corporation or such
subsidiary than those that could be obtained in a comparable arm's length
transaction with a person that is not such officer, director, trustee,
owner or Affiliate.
(c) The Corporation shall not amend, alter or repeal the preferences,
conversion or other rights or powers, restrictions, limitations as to dividends
or the rights, limitations, qualifications or terms or conditions of redemption
of the Series A-1 Preferred Shares so as to affect adversely the Series A-1
Preferred Shares, without the written consent or affirmative vote or, if
permitted by applicable law, the written consent, of the holders of at least
66-2/3% of the then outstanding aggregate number of shares of such adversely
affected Series A-1 Preferred Shares, or consenting (as the case may be)
separately as a class.
(d) For all provisions of the Declaration requiring the approval of
the holders of shares of Series A-1 Preferred Shares, all Preferred Shares owned
by the Corporation or any person in which the Corporation has directly or
indirectly a 10% or more equity interest shall be disregarded and shall not be
deemed to be outstanding.
SECTION 5. CONVERSION. (a) Each share of Series A-1 Preferred Shares may be
converted at any time during the Conversion Period (as defined below), at the
option of the holder thereof, into the number of fully-paid and nonassessable
shares of Common Shares obtained by dividing the then applicable Liquidation
Preference by the Conversion Price (as defined below) then in effect. The right
of conversion given during the Conversion Period shall not be affected by any
notice of redemption. Holders of Series A-1
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<PAGE> 14
Preferred Shares at the close of business on a record date (which shall be the
Business Day next preceding the Quarterly Payment Date) for a corresponding
Quarterly Payment Date will be entitled to receive the dividend payable on such
Series A-1 Preferred Shares on such Quarterly Payment Date notwithstanding the
conversion of Series A-1 Preferred Shares following such record date. Except as
provided in the immediately preceding sentence, the Corporation will make no
payment or allowance for dividends which accrued on the converted Series A-1
Preferred Shares since the last Quarterly Payment Date prior to conversion.
Holders of Common Shares which are issuable upon conversion made prior to or on
a record date for any dividend or distribution on such shares shall be entitled
to receive the same dividend or distribution as other holders of record of
Common Shares. Each conversion will be deemed to have been effected immediately
prior to the close of business on the day on which the notice of conversion was
received by the Corporation. The "Conversion Price" per share shall be equal to
the product of (i) the average of Market Price (rounded to the nearest $0.01)
per share over the 30 trading days prior to the date of conversion times (ii)
the Applicable Conversion Percentage. As used herein, the term "Market Price" as
of any trading day, subject to adjustment pursuant to Section 6, means (i) if
the Common Shares are listed on any national securities exchange, the last sales
price of the Common Shares on such exchange (or the quoted closing bid price if
there shall have been no sales) on such trading day, or (ii) if the Common
Shares shall not be listed, the mean between the closing bid and asked prices on
such trading day for the Common Shares on the date of conversion as reported by
NASDAQ, or its successor, and if there are not such closing bid and asked
prices, on the basis of the fair market value per share on such trading day as
determined by an appraiser mutually satisfactory to the Board of Trustees of the
Corporation and the holders of a majority of the outstanding shares of Series
A-1 Preferred Shares who have given notice of conversion. Any change in the
Market Price due to an adjustment pursuant to Section 6 shall take effect on the
date of any Triggering Event (as defined in Section 6).
As used herein, the term "Applicable Conversion Percentage" means (i)
at all times during the occurrence and continuance of a Default, the lesser of
0.80 and the decimal which would otherwise be in effect in clause (ii) of this
definition in the absence of a Default, and (ii) so long as a Default has not
occurred and is continuing (w) at all times after November 27, 1996 to but not
including the sixth anniversary of the November 27, 1996, 0.90, (x) at all times
from and including the sixth anniversary of November 27, 1996 to but not
including the seventh anniversary of November 27, 1996, 0.85, (y) at all times
from and including the seventh anniversary of November 27, 1996 to but not
including the eighth anniversary of November 27, 1996, 0.80 and (z) at all times
from and after the ninth anniversary of November 27, 1996, 0.70.
As used herein, the term "Conversion Period" means the period (a)
commencing on the earliest of (i) the date of a Default (it being understood
that an event included in clause (i) or (ii) of the definition of the term
"Default" does not constitute a Default until the 120 day period referred to
therein has lapsed and such event remains) whether or not such Default is
subsequently cured, (ii) the fifth anniversary of the date (November 27, 1996)
when at least 32,000 shares of Series A Convertible Preferred Beneficial
Interests have been issued, (iii) the fifth anniversary of the date on which a
permanent certificate of occupancy is issued in connection with the Great Plains
MetroMall, and (iv) the six anniversary of November 27, 1996 and (b) ending on
the close of business on the Business Day next preceding the date fixed for
redemption or for the payment of any amounts distributable on liquidation to the
holders of the Series A-1 Preferred Shares.
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<PAGE> 15
(b) The Corporation shall not issue fractions of shares of Common
Shares upon conversion of Series A-1 Preferred Shares or scrip in lieu thereof.
If any fraction of a share of Common Shares would, except for the provisions of
this Section (b), be issuable upon conversion of any Series A-1 Preferred
Shares, the Corporation shall in lieu thereof pay to the person entitled thereto
an amount in cash equal to the current value of such fraction, calculated to the
nearest one-hundredth (1/100) of a share, to be computed (i) if the Common
Shares are listed on any national securities exchange on the basis of the last
sales price of the Common Shares on such exchange (or the quoted closing bid
price if there shall have been no sales) on the date of conversion, or (ii) if
the Common Shares shall not be listed, on the basis of the mean between the
closing bid and asked prices for the Common Shares on the date of conversion as
reported by NASDAQ, or its successor, and if there are not such closing bid and
asked prices, on the basis of the fair market value per share on the date of
conversion as determined by an appraiser mutually satisfactory to the Board of
Trustees of the Corporation and the holders of a majority of the outstanding
shares of Series A-1 Preferred Shares who have given notice of conversion.
(c) Whenever the Conversion Price shall be adjusted as provided in
Section 6 hereof, the Corporation shall forthwith file at each office designated
for the conversion of Series A-1 Preferred Shares, a statement, signed by the
Chairman of the Board, the President, any Vice President or the Treasurer of the
Corporation, showing in reasonable detail the facts requiring such adjustment
and the Conversion Price that will be effective after such adjustment. The
Corporation shall also cause a notice setting forth any such adjustments to be
sent by mail, first class, postage prepaid, to each record holder of Series A-1
Preferred Shares at his or its address appearing on the Shares register. If such
notice relates to an adjustment resulting from an event referred to in Section
6(g), such notice shall be included as part of the notice required to be mailed
and published under the provisions of Section 6(g) hereof.
(d) In order to exercise the conversion privilege, the holder of any
Series A-1 Preferred Shares to be converted shall surrender his or its
certificate or certificates therefor to the transfer agent for the Series A-1
Preferred Shares at the principal office of the transfer agent (or if no
transfer agent be at the time appointed, to the Corporation at its principal
office), and shall give written or facsimile notice (which may be given on the
date of conversion) to the transfer agent, if any, and to the Corporation at
such office that the holder elects to convert the Series A-1 Preferred Shares
represented by such certificates, or any number thereof. Such notice shall also
state the name or names (with address) in which the certificate or certificates
for shares of Common Shares which shall be issuable on such conversion shall be
issued, subject to any restrictions on transfer relating to shares of the Series
A-1 Preferred Shares or shares of Common Shares upon conversion thereof. If so
required by the Corporation, certificates surrendered for conversion shall be
endorsed or accompanied by written instrument or instruments of transfer, in
form satisfactory to the Corporation, duly authorized in writing. The date of
receipt by the transfer agent (or by the Corporation if the Corporation serves
as its own transfer agent) of the certificates and notice shall be the
conversion date. As soon as practicable after receipt of such notice and the
surrender of the certificate or certificates for Series A-1 Preferred Shares as
aforesaid, the Corporation shall cause to be issued and delivered at such office
to such holder, or on his or its written order, a certificate or certificates
for the number of full shares of Common Shares
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<PAGE> 16
issuable on such conversion in accordance with the provisions hereof and cash as
provided in Section 5(b) in respect of any fraction of a share of Common Shares
otherwise issuable upon such conversion.
(e) The Corporation shall at all times when the Series A-1 Preferred
Shares shall be outstanding reserve and keep available out of its authorized but
unissued Common Shares, for the purposes of effecting the conversion of the
Series A-1 Preferred Shares, such number of its duly authorized shares of Common
Shares as shall from time to time be sufficient to effect the conversion of all
outstanding Series A-1 Preferred Shares. Before taking any action which would
cause an adjustment reducing the Conversion Price below the then par value of
the shares of Common Shares issuable upon conversion of the Series A-1 Preferred
Shares, the Corporation will take any corporate action which may, in the opinion
of its counsel, be necessary in order that the Corporation may validly and
legally issue fully-paid and nonassessable shares of such Common Shares at such
adjusted conversion price.
(f) All shares of Series A-1 Preferred Shares which shall have been
surrendered for conversion as herein provided shall no longer be deemed to be
outstanding and all rights with respect to such shares, including the rights, if
any, to receive notices and to vote, shall forthwith cease and terminate except
only the right of the holder thereof to receive shares of Common Shares in
exchange therefor and payment of any accrued and unpaid dividends thereon. Any
shares of Series A-1 Preferred Shares so converted shall be retired and
cancelled and shall not be reissued, and the Corporation may from time to time
take such appropriate action as may be necessary to reduce the number of
authorized Series A-1 Preferred Shares accordingly, including the filing of
articles supplementary.
(g) Notwithstanding anything to the contrary herein contained, unless
and until approval ("Shareholder Approval") of the holders of the Common Shares
shall have been obtained in compliance with the rules and policies of the New
York Stock Exchange, no holder of Series A-1 Preferred Shares shall have the
right to convert such Series A-1 Preferred Shares into Common Shares if, as a
result of such conversion and all prior or concurrent conversions of Pari Passu
Shares, (1) all Common Shares issued as a result of such conversions would have
voting power equal to or in excess of 20 percent of the voting power of the
Common Shares outstanding (excluding Treasury Shares, shares held by a
subsidiary and shares reserved for issuance upon conversion or exercise of
options or warrants) on November 27, 1996, or (2) the number of Common Shares
issued as a result of such conversions would be equal to or in excess of 20
percent of the number of Common Shares outstanding on November 27, 1996. The
date on and after which conversion shall no longer be permitted as a result of
the operation of this Section 5(g) is herein called the "Conversion Termination
Date", it being understood that if Shareholder Approval is obtained or if any
Pari Passu Shares which are convertible without Shareholder Approval have not
been converted, no Conversion Termination Date shall occur. Promptly, and in any
event within three (3) Business Days, after the Conversion Termination Date, the
Corporation shall forthwith file, at each office designated for the conversion
of Series A-1 Preferred Shares, a statement, signed by the Chairman of the
Board, the President, any Vice President or Treasurer of the Corporation,
stating that the Conversion Termination Date has occurred and setting forth the
reason therefor. The Corporation shall also cause a notice setting forth such
information to be sent by mail,
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first class, postage prepaid, to each record holder of Series A-1 Preferred
Shares at his or its address appearing on the Preferred Shares register.
SECTION 6. ANTI-DILUTION PROVISIONS.
(a) The provisions of this Section 6 shall not be applicable except in
connection with a conversion pursuant to Section 5. In order to prevent dilution
of the right granted hereunder, the Market Price on any date shall be subject to
adjustment from time to time in accordance with this Section 6(a). For purposes
of this Section 6, the term "Number of Common Shares Deemed Outstanding" at any
given time shall mean the sum of (x) the number of shares of the Corporation's
Common Shares outstanding at such time, (y) the number of shares of the
Corporation's Common Shares issuable assuming conversion at such time of the
Corporation's Series A-1 Preferred Shares and the Pari Passu Shares and (z) the
number of shares of the Corporation's Common Shares deemed to be outstanding
under Sections 6(b)(1) to (9), inclusive, at such time.
Except as provided in Section 6(c) or 6(f) below, if and whenever on
or after November 27, 1996, the Corporation shall issue or sell, or shall in
accordance with Sections 6(b)(1) to (9), inclusive, be deemed to have issued or
sold, any shares of its Common Shares for a consideration per share less than
the Market Price in effect immediately prior to the time of such issue or sale,
then forthwith upon such issue or sale (the "Triggering Transaction"), the
Market Price for all trading days prior to such Triggering Transaction shall,
subject to Sections 6(b)(1) to 6(b)(9), be reduced to the Market Price
(calculated to the nearest tenth of a cent) determined by dividing (x) an amount
equal to the sum of (1) the product derived by multiplying the Number of Common
Shares Deemed Outstanding immediately prior to such Triggering Transaction by
the Market Price then in effect, plus (2) the consideration, if any, received by
the Company upon consummation of such Triggering Transaction, by (y) an amount
equal to the sum of (1) the Number of Common Shares Deemed Outstanding
immediately prior to such Triggering Transaction plus (2) the number of shares
of Common Shares issued (or deemed to be issued in accordance with Sections
6(b)(1) to 6(b)(9)) in connection with the Triggering Transaction.
(b) This Section 6(b) shall apply only in connection with events
referred to in Sections 6(b)(1) through 6(b)(9) which occur within the 30 days
immediately preceding a notice of conversion and only with respect to the
specific shares of Series A-1 Preferred Shares which are the subject of the
notice of conversion and are in fact converted. For purposes of determining the
adjusted Conversion Price under this Section 6(b), the following Sections
6(b)(1) to 6(b)(9), inclusive, shall be applicable:
(1) In case the Corporation at any time shall in any manner grant
(whether directly or by assumption in a merger or otherwise) any
rights to subscribe for or to purchase, or any options for the
purchase of, Common Shares or any Preferred Shares (other than the
Series A-1 Shares and the Pari Passu Shares) or other securities
convertible into or exchangeable for Common Shares (such rights or
options being herein called "Options" and such convertible or
exchangeable Shares or securities being herein called "Convertible
Securities"), whether or not such Options or the right to convert or
exchange any such Convertible Securities are immediately exercisable
and the price per share for which the Common Shares is issuable upon
exercise, conversion or exchange (determined by dividing (x) the total
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amount, if any, received or receivable by the Corporation as
consideration for the granting of such Options, plus the minimum
aggregate amount of additional consideration payable to the
Corporation upon the exercise of all such Options, plus, in the case
of such Options which relate to Convertible Securities, the minimum
aggregate amount of additional consideration, if any, payable upon the
issue or sale of such Convertible Securities and upon the conversion
or exchange thereof, by (y) the total maximum number of shares of
Common Shares issuable upon the exercise of such Options or the
conversion or exchange of such Convertible Securities) shall be less
than the Market Price in effect immediately prior to the time of the
granting of such Option, then the total maximum amount of Common
Shares issuable upon the exercise of such Options or, in the case of
Options for Convertible Securities, upon the conversion or exchange of
such Convertible Securities shall (as of the date of granting of such
Options) be deemed to be outstanding and to have been issued and sold
by the Corporation for such price per share. No adjustment of the
Market Price shall be made upon the actual issue of such shares of
Common Shares or such Convertible Securities upon the exercise of such
Options, except as otherwise provided in Section 6(b)(3) below.
(2) In case the Corporation at any time shall in any manner issue
(whether directly or by assumption in a merger or otherwise) or sell
any Convertible Securities, whether or not the rights to exchange or
convert thereunder are immediately exercisable, and the price per
share for which Common Shares are issuable upon such conversion or
exchange (determined by dividing (x) the total amount received or
receivable by the Corporation as consideration for the issue or sale
of such Convertible Securities, plus the minimum aggregate amount of
additional consideration, if any, payable to the Corporation upon the
conversion or exchange thereof, by (y) the total maximum number of
shares of Common Shares issuable upon the conversion or exchange of
all such Convertible Securities) shall be less than the Market Price
in effect immediately prior to the time of such issue or sale, then
the total maximum number of shares of Common Shares issuable upon
conversion or exchange of all such Convertible Securities shall (as of
the date of the issue or sale of such Convertible Securities) be
deemed to be outstanding and to have been issued and sold by the
Corporation for such price per share. No adjustment of the Market
Price shall be made upon the actual issue of such Common Shares upon
exercise of the rights to exchange or convert under such Convertible
Securities, except as otherwise provided in Section 6(b)(3) below.
(3) If the purchase price provided for in any Options referred to
in Section 6(b)(1), the additional consideration, if any, payable upon
the conversion or exchange of any Convertible Securities referred to
in Sections 6(b)(1) or 6(b)(2), or the rate at which any Convertible
Securities referred to in Section 6(b)(1) or 6(b)(2) are convertible
into or exchangeable for Common Shares shall change at any time (other
than under or by reason of provisions designed to protect against
dilution of the type set forth in Sections 6(b) or 6(d)), the Market
Price in effect at the time of such change shall forthwith be
readjusted to the Market Price which would have been in effect at such
time
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<PAGE> 19
had such Options or Convertible Securities still outstanding provided
for such changed purchase price, additional consideration or
conversion rate, as the case may be, at the time initially granted,
issued or sold. If the purchase price provided for in any Option
referred to in Section 6(b)(1) or the rate at which any Convertible
Securities referred to in Sections 6(b)(1) or 6(b)(2) are convertible
into or exchangeable for Common Shares shall be reduced at any time
under or by reason of provisions with respect thereto designed to
protect against dilution, then in case of the delivery of Common
Shares upon the exercise of any such Option or upon conversion or
exchange of any such Convertible Security, the Market Price then in
effect hereunder shall forthwith be adjusted to such respective amount
as would have been obtained had such Option or Convertible Security
never been issued as to such Common Shares and had adjustments been
made upon the issuance of the shares of Common Shares delivered as
aforesaid, but only if as a result of such adjustment the Market Price
then in effect hereunder is hereby reduced.
(4) On the expiration of any Option or the termination of any
right to convert or exchange any Convertible Securities, the
Conversion Price then in effect hereunder shall forthwith be increased
to the Conversion Price which would have been in effect at the time of
such expiration or termination had such Option or Convertible
Securities, to the extent outstanding immediately prior to such
expiration or termination, never been issued.
(5) In case any Options shall be issued in connection with the
issue or sale of other securities of the Corporation, together
comprising one integral transaction in which no specific consideration
is allocated to such Options by the parties thereto, such Options
shall be deemed to have been issued for an amount equal to the fair
market value thereof, determined by allocating to the other securities
the market price thereof.
(6) In case any shares of Common Shares, Options or Convertible
Securities shall be issued or sold or deemed to have been issued or
sold for cash, the consideration received therefor shall be deemed to
be the amount received by the Corporation therefor. In case any shares
of Common Shares, Options or Convertible Securities shall be issued or
sold for a consideration other than cash, the amount of the
consideration other than cash received by the Corporation shall be the
fair value of such consideration as determined in good faith by the
Board of Trustees of the Corporation. In case any shares of Common
Shares, Options or Convertible Securities shall be issued in
connection with any merger in which the Corporation is the surviving
Corporation, the amount of consideration therefor shall be deemed to
be the fair value of such portion of the net assets and business of
the non-surviving Corporation as shall be attributable to such Common
Shares, Options or Convertible Securities, as the case may be.
(7) The number of shares of Common Shares outstanding at any
given time shall not include shares owned or held by or for the
account of the Corporation, and the disposition (but not redemption or
retirement) of any shares so owned or held shall be
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<PAGE> 20
considered an issue or sale of Common Shares for the purpose of this
Section 6(b).
(8) In case the Corporation shall declare a dividend or make any
other distribution upon the Shares of the Corporation payable in
Options or Convertible Securities, then in such case any Options or
Convertible Securities, as the case may be, issuable in payment of
such dividend or distribution shall be deemed to have been issued or
sold without consideration.
(9) For purposes of this Section 6(b), in case the Corporation
shall take a record of the holders of its Common Shares for the
purpose of entitling them (x) to receive a dividend or other
distribution payable in Common Shares, Options or in Convertible
Securities, or (y) to subscribe for or purchase Common Shares, Options
or Convertible Securities, then such record date shall be deemed to be
the date of the issue or sale of the shares of Common Shares deemed to
have been issued or sold upon the declaration of such dividend or the
making of such other distribution or the date of the granting of such
right or subscription or purchase, as the case may be.
(c) In the event that within the thirty days immediately prior to the
date of conversion of Series A-1 Preferred Shares the Board of Trustees shall
authorize a dividend upon the Common Shares (other than a dividend payable in
Common Shares) payable otherwise than out of earnings or earned surplus,
determined in accordance with generally accepted accounting principles,
including the making of appropriate deductions for minority interests, if any,
in subsidiaries (herein referred to as "Liquidating Dividends"), then, as soon
as possible after the conversion of any Series A-1 Preferred Shares, the
Corporation shall pay to the person converting such Series A-1 Preferred Shares
an amount equal to the Pro Rata Share of the aggregate value at the time of such
exercise of all Liquidating Dividends (including but not limited to the Common
Shares which would have been issued at the time of such earlier exercise and all
other securities which would have been issued with respect to such Common Shares
by reason of share splits, share dividends, mergers or reorganizations, or for
any other reason). The Pro Rata Share shall be a fraction, the numerator of
which is the number of days within such thirty day period that are before the
record date and the denominator of which is thirty. For the purposes of this
Section 6(c), a dividend other than in cash shall be considered payable out of
earnings or earned surplus only to the extent that such earnings or earned
surplus are charged an amount equal to the fair value of such dividend as
determined in good faith by the Board of Trustees of the Corporation.
(d) In case the Corporation shall at any time (i) subdivide the
outstanding Common Shares or (ii) pay a dividend on its outstanding Common
Shares in shares of beneficial interests of the Corporation, the number of
shares of Common Shares issuable upon conversion of the Series A-1 Preferred
Shares shall be proportionately increased by the same ratio as the subdivision
or dividend (with appropriate adjustments to the Conversion Price in effect
immediately prior to such subdivision or dividend). In case the Corporation
shall at any time combine its outstanding Common Shares, the number of shares
issuable upon conversion of the Series A-1 Preferred Shares immediately prior to
such combination shall be proportionately decreased by the same ratio as the
combination (with
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<PAGE> 21
appropriate adjustments to the Conversion Price in effect immediately prior to
such combination).
(e) If any capital reorganization or reclassification of the shares of
beneficial interest of the Corporation, or consolidation or merger of the
Corporation with another entity, or the sale of all or substantially all of its
assets to another entity shall be effected in such a way that holders of Common
Shares shall be entitled to receive stock, securities, cash or other property
with respect to or in exchange for Common Shares, then, as a condition of such
reorganization, reclassification, consolidation, merger or sale, lawful and
adequate provision shall be made whereby the holders of the Series A-1 Preferred
Shares shall have the right to acquire and receive upon conversion of the Series
A-1 Preferred Shares, which right shall be prior to the rights of the holders of
Junior Shares (but after and subject to the rights of holders of Senior
Preferred Shares, if any), such shares of stock, securities, cash or other
property issuable or payable (as part of the reorganization, reclassification,
consolidation, merger or sale) with respect to or in exchange for such number of
outstanding shares of the Corporation's Common Shares as would have been
received upon conversion of the Series A-1 Preferred Shares at the Conversion
Price then in effect. The Corporation will not effect any such consolidation,
merger or sale, unless prior to the consummation thereof the successor entity
(if other than the Corporation) resulting from such consolidation or merger or
the entity purchasing such assets shall assume by written instrument mailed or
delivered to the holders of the Series A-1 Preferred Shares at the last address
of each such holder appearing on the books of the Corporation, the obligation to
deliver to each such holder such shares of Shares, securities or assets as, in
accordance with the foregoing provisions, such holder may be entitled to
purchase. If a purchase, tender or exchange offer is made to and accepted by the
holders of more than 50% of the outstanding Common Shares of the Corporation,
the Corporation shall not effect any consolidation, merger or sale with the
person having made such offer or with any Affiliate of such person, unless prior
to the consummation of such consolidation, merger or sale the holders of the
Series A-1 Preferred Shares shall have been given a reasonable opportunity to
then elect to receive upon the conversion of the Series A-1 Preferred Shares
either the stock, securities or assets then issuable with respect to the Common
Shares of the Corporation or the stock, securities or assets, or the equivalent,
issued to previous holders of the Common Shares in accordance with such offer.
For purposes hereof, the term "Affiliate" with respect to any given person shall
mean any person controlling, controlled by or under common control with the
given person.
(f) The provisions of this Section 6 shall not apply to any Common
Shares issued, issuable or deemed outstanding under Sections 6(b)(1) to (9)
inclusive: (i) to any person pursuant to any stock option, stock purchase or
similar plan or arrangement for the benefit of employees or Trustees of the
Corporation or its subsidiaries in effect on November 27, 1996 or thereafter
adopted by the Board of Trustees of the Corporation and a majority of the Series
A-1 Trustees, (ii) pursuant to options, warrants and conversion rights in
existence on November 27, 1996, or (iii) on the conversion of the Series A-1
Preferred Shares or the sale or conversion of the Pari Passu Shares.
(g) In the event that during any time when the Series A-1 Preferred
Shares are subject to conversion rights:
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<PAGE> 22
(1) the Corporation shall authorize any extraordinary cash
dividend upon its Common Shares, or
(2) the Corporation shall authorize any dividend upon its Common
Shares payable in Shares or make any special dividend or other
distribution to the holders of its Common Shares, or
(3) the Corporation shall offer for subscription pro rata to the
holders of its Common Shares any additional shares of any class or
other rights, or
(4) there shall be any capital reorganization or reclassification
of the shares of beneficial interest of the Corporation, including any
subdivision or combination of its outstanding shares of Common Shares,
or consolidation or merger of the Corporation with, or sale of all or
substantially all of its assets to, another entity, or
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Corporation;
then, in connection with such event, the Corporation shall give to the holders
of the Series A-1 Preferred Shares:
(i) at least five (5) days prior written notice of the date on which
the books of the Corporation shall close or a record shall be taken for
such dividend, distribution or subscription rights or for determining
rights to vote in respect of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up; and
(ii) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or winding up, at
least twenty (20) days prior written notice of the date when the same shall
take place. Such notice in accordance with the foregoing clause (i) shall
also specify, in the case of any such dividend, distribution or
subscription rights, the date on which the holders of Common Shares shall
be entitled thereto, and such notice in accordance with the foregoing
clause (i) shall also specify the date on which the holders of Common
Shares shall be entitled to exchange their Common Shares for securities or
other property deliverable upon such reorganization, reclassification
consolidation, merger, sale, dissolution, liquidation or winding up, as the
case may be. Each such written notice shall be given by first class mail,
postage prepaid, addressed to the holders of the Series A-1 Preferred
Shares at the address of each such holder as shown on the books of the
Corporation.
(h) If at any time or from time to time on or after November 27, 1996,
the Corporation shall grant, issue or sell any Options, Convertible Securities
or rights to purchase property (the "Purchase Rights") pro rata to the record
holders of Common Shares of the Corporation and such grants, issuances or sales
do not result in an adjustment of the Conversion Price under Section 6(b)
hereof, then each holder of Series A-1 Preferred Shares shall be entitled to
acquire (within thirty (30) days after the later to occur of the initial
exercise date of such Purchase Rights or receipt by such holder of the notice
concerning Purchase Rights to which such holder shall be entitled under Section
6(g)) upon the terms applicable to such Purchase Rights either:
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<PAGE> 23
(i) the aggregate Purchase Rights which such holder could have
acquired if it had held the number of shares of Common Shares acquirable
upon conversion of the Series A-1 Preferred Shares immediately before the
grant, issuance or sale of such Purchase Rights; provided that if any
Purchase Rights were distributed to holders of Common Shares without the
payment of additional consideration by such holders, corresponding Purchase
Rights shall be distributed to the exercising holders of the Series A-1
Preferred Shares as soon as possible after such exercise and it shall not
be necessary for the exercising holder of the Series A-1 Preferred Shares
specifically to request delivery of such rights; or
(ii) in the event that any such Purchase Rights shall have expired or
shall expire prior to the end of said thirty (30) day period, the number of
shares of Common Shares or the amount of property which such holder could
have acquired upon such exercise at the time or times at which the
Corporation granted, issued or sold such expired Purchase Rights.
SECTION 7. REDEMPTION.
(a) The Corporation (i) shall on each date (a "Mandatory Redemption
Date") on which Net Proceeds (as defined below) are received by the Development
LLC (as defined below), whether or not such Net Proceeds are made available to
the Corporation and (ii) may on any date (an "Optional Redemption Date" and each
Mandatory Redemption Date and Optional Redemption Date are herein called a
"Redemption Date") (unless notice of conversion shall have been previously
given) redeem (to the extent that such redemption shall not violate any
applicable provisions of the laws of the State of Maryland or result in a
failure of the Corporation to qualify as a real estate investment trust under
the provisions of Sections 856 through 858 of the Internal Revenue Code of 1986,
as amended (after taking into account the ability of the Corporation to borrow
funds or raise capital to effect the redemption)) at a price equal to the
Liquidation Preference per share (subject to adjustment in the event of any
share dividend, share split, share distribution or combination with respect to
such shares), plus an amount equal to any dividends accrued but unpaid thereon
(such amount is hereinafter referred to as the "Redemption Price"), (x) in the
case of clause (i) above, such maximum number of whole shares of Series A-1
Preferred Shares as may be redeemed at the Redemption Price with the Net
Proceeds and (y) in the case of clause (ii) above, such number of whole shares
of Series A-1 Preferred Shares as determined by the Board of Trustees. If the
Corporation is unable at any Redemption Date to redeem any shares of the Series
A-1 Preferred Shares then required to be redeemed because such redemption would
violate the applicable laws of the State of Maryland or result in such failure
to qualify as a real estate investment trust as aforesaid, then the Corporation
shall redeem such shares as soon thereafter as redemption would not violate such
laws.
As used herein, the terms:
(1) "Development LLC" means Great Plains MetroMall LLC, a Delaware
limited liability company and its successors and assigns; and
(2) "Net Proceeds" means the cash proceeds from any Capital
Transaction (as such term is defined in the Operating Agreement) which are
available to be distributed to members pursuant to Section 8.2 of such Operating
Agreement.
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(3) "Operating Agreement" means the Operating Agreement of the
Development LLC, as such agreement is in effect on the Original Issuance Date.
(b) In the event of any redemption of only a part of the then
outstanding Series A-1 Preferred Shares, the Corporation shall effect such
redemption pro rata among the holders thereof (based on the number of shares of
Series A-1 Preferred Shares held on the date of notice of redemption).
(c) At least thirty (30) days prior to each Optional Redemption Date,
written notice shall be mailed, postage prepaid, to each holder of record of
Series A-1 Preferred Shares to be redeemed, at his or its post office address
last shown on the records of the Corporation, notifying such holder of the
number of shares so to be redeemed, specifying the Redemption Date and the date
on which such holder's conversion rights (pursuant to Section 5 hereof) as to
such shares terminate and calling upon such holder to surrender to the
Corporation, in the manner and at the place designated, his or its certificate
or certificates representing the shares to be redeemed (such notice is
hereinafter referred to as a "Redemption Notice"). On or prior to each
Redemption Date, each holder of Series A-1 Preferred Shares to be redeemed shall
surrender his or its certificate or certificates representing such shares to the
Corporation, in the manner and at the place designated in the Redemption Notice,
and thereupon the Redemption Price of such shares shall be payable to the order
of the person whose name appears on such certificate or certificates as the
owner thereof and each surrendered certificate shall be cancelled. In the event
less than all the shares represented by any such certificate are redeemed, a new
certificate shall be issued representing the unredeemed shares. From and after
the Redemption Date, unless there shall have been a default in payment of the
Redemption Price, all rights of the holders of the Series A- 1 Preferred Shares
designated for redemption in the Redemption Notice as holders of Series A-1
Preferred Shares of the Corporation (except the right to receive the Redemption
Price without interest upon surrender of their certificate or certificates)
shall cease with respect to such shares, and such shares shall not thereafter be
transferred on the books of the Corporation or be deemed to be outstanding for
any purpose whatsoever.
(d) Except as provided in Section (a) above, the Corporation shall
have no right to redeem the shares of Series A-1 Preferred Shares. Any shares of
Series A-1 Preferred Shares so redeemed shall be permanently retired, shall no
longer be deemed outstanding and shall not under any circumstances be reissued,
and the Corporation may from time to time take such appropriate corporate action
as may be necessary to reduce the authorized Series A-1 Preferred Shares
accordingly, including the filing of articles supplementary. Nothing herein
contained shall prevent or restrict the purchase by the Corporation, from time
to time either at public or private sale, of the whole or any part of the Series
A-1 Preferred Shares at such price or prices as the Corporation may determine,
subject to the provisions of applicable law.
SECTION 8. NO RECOURSE TO SHAREHOLDERS, TRUSTEES, OFFICERS OR AGENTS.
It is a condition of the Preferred Shares that any obligations of the
Corporation hereunder shall bind only the Corporation as provided in Section 8.1
of the Declaration and no shareholder, trustee, officer or
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<PAGE> 25
agent of the Corporation shall be bound or held to any personal liability in
connection herewith.
SECTION 9. NO PREEMPTIVE OR APPRAISAL RIGHTS.
The Preferred Shares shall not be entitled to any preemptive rights
or, except as specifically required by applicable statute, appraisal rights.
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EXHIBIT 4.6
Series A-1 Preferred Number 1 Shares 34,000
GLIMCHER REALTY TRUST
a Real Estate Investment Trust
Formed Under the Laws of the State of Maryland
THIS CERTIFIES THAT Partnership Acquisition Trust II, a Delaware business trust
is the owner of Thirty-Four Thousand (34,000) fully paid and nonassessable
Series A-1 Convertible Preferred Shares of Beneficial Interest of
GLIMCHER REALTY TRUST
(the "Trust") transferable on the books of the Trust by the holder hereof in
person or by its duly authorized attorney, upon surrender of this Certificate
properly endorsed. This Certificate and the Shares represented hereby are issued
and shall have the preferences, conversion and other rights, voting powers,
restrictions, limitations as to dividends and other distributions,
qualifications and terms and conditions of redemption set forth in Exhibit 1 of
the Articles Supplementary Clarifying and Designating 40,000 Shares of
Beneficial Interest as Shares of Series A-1 Convertible Preferred Beneficial
Interests.
IN WITNESS WHEREOF, the Trust has caused this Certificate to be signed by
its duly authorized officers and its seal to be hereunder affixed this ____ day
of November, 1997.
__________________________________ __________________________________(SEAL)
George A. Schmidt, Secretary David J. Glimcher, President
The securities evidenced hereby have not been registered under the Securities
Act of 1933, as amended (the "Act"), and may not be transferred except pursuant
to an effective registration under the Act or in a transaction which in the
opinion of counsel (who may be inside counsel of the holder of these securities)
reasonably satisfactory to GRT, qualifies as an exempt transaction under the Act
and the rules and regulations promulgated thereunder.
The trust will furnish to any stockholder, upon request and without charge, a
full statement regarding: (i) the designations and any preferences, conversion
and other rights, voting powers, restrictions, limitations as to dividends,
qualifications, and terms and conditions of redemption of the stock of each
class which the Trust is authorized to issue; (ii) the differences in the
relative rights and preferences between the shares of each series to the extent
they have been set; (iii) the authority of the Board of Trustees to set the
relative
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<PAGE> 2
rights and preferences of subsequent series; and (iv) restrictions on
transferability.
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